Textron 3Q profit plunges on weak markets

PROVIDENCE, R.I. (AP) - Textron Inc. said Tuesday its third-quarter profit plunged 98 percent as the company continues to face reduced sales at its corporate jet and helicopter businesses.

Scott Donnelly, the company's president and CEO-elect, said demand for its products "continues to show signs of stabilization," but that recovery "likely will be slow and modest."

In addition to the downturn in business jets, Textron also had significant problems when capital markets locked up last year. Its finance arm, which makes loans to buyers of new and used Cessna business jets, golf courses and vacation-resort developments, was hit hard and is struggling to recover.

Shares of Textron climbed to $20.04, up 9.2 percent, or $1.68 in morning trading.

The Providence, R.I., company which also makes Bell helicopters and EZ-Go golf carts, said its profit fell to $4 million, or 1 cent per share, for the period ended Oct. 3, down sharply from $206 million, or 83 cents per share, a year ago. It earned 2 cents per share from continuing operations. On that basis, analysts surveyed by Thomson Reuters on average expected a loss of 3 cents per share.

Revenue fell 27 percent, to $2.55 billion from $3.47 billion last year.

Textron, which has been battered by the financial crisis and a steep fall in business-jet orders, said full-year restructuring charges are now expected to be about $240 million, up from about $200 million announced by the company in July. That was an increase from a previous estimate of $75 million.

The company said it would cut 1,300 Cessna jobs this summer, in addition to 6,900 workers who were previously laid off. Cessna, which has reduced its work force by half since November 2008, has said it will curtail production of Cessna jets this year as customers cancel or defer orders.

Textron said it expects its full-year earnings, excluding special charges, will be in the upper end of its previous guidance of 33 cents per share to 63 cents per share on revenue of about $10.6 billion.

Analysts surveyed by Thomson Reuters expect Textron to post a loss of 6 cents per share on revenue of $10.3 billion.