RTX Corp. (RTX) reported that first-quarter sales rose 9% to $22.1 billion, with net income jumping 34% to $2.06 billion and EPS up 32% to $1.51. Given first quarter results and the strength in its defense business, management also raised its full-year outlook for adjusted sales and EPS while maintaining its free cash flow outlook, notes Ingrid Hendershot, editor at Hendershot Investments.
Excluding acquisition accounting adjustments and other special items, adjusted EPS increased 21% to $1.78, powered by growth in segment operating profit across all three business segments and lower interest and tax expense. Backlog grew by 25%, resulting in a book-to-bill ratio of 1.14.
RTX Corp. (RTX)
By business segment, Collins Aerospace sales increased 5% to $7.6 billion, powered by a 15% rise in commercial OE sales, a 7% increase in commercial aftermarket sales, and a 9% increase in defense sales. Adjusted segment operating margin expanded by 6%, resulting in a 17.1% adjusted operating margin.
Pratt & Whitney sales increased 11% to $8.2 billion, powered by a 19% jump in commercial aftermarket sales and a 7% increase in military sales, partially offset by a 1% decline in commercial OE. Adjusted operating margins jumped 21%, resulting in an 8.7% adjusted operating margin for the segment.
Raytheon segment sales increased 10% to $6.9 billion on higher land and air defense systems and naval munitions volume. Adjusted operating margin rose 25%, resulting in a 12.2% adjusted operating margin for the segment.
During the first quarter, Raytheon generated $1.3 billion in free cash flow, up 65% from last year. The company returned $915 million to shareholders through dividend payments.
