UTC Investor and
Analyst Meeting
March 10, 2017
Note: All results and expectations in this presentation reflect continuing operations unless otherwise noted.
Cautionary Statement:
This presentation contains statements which, to the extent they are not statements of historical or present fact, constitute "forward-looking statements" under the securities laws. From time to time, oral
or written forward-looking statements may also be included in other information released to the public. These forward-looking statements are intended to provide management’s current expectations or
plans for our future operating and financial performance, based on assumptions currently believed to be valid. Forward-looking statements can be identified by the use of words such as "believe,"
"expect," "expectations," "plans," "strategy," "prospects," "estimate," "project," "target," "anticipate," "will," "should," "see," "guidance," "confident" and other words of similar meaning in connection with a
discussion of future operating or financial performance. Forward-looking statements may include, among other things, statements relating to future sales, earnings, cash flow, results of operations, uses
of cash, share repurchases and other measures of financial performance or potential future plans, strategies or transactions. All forward-looking statements involve risks, uncertainties and other factors
that may cause actual results to differ materially from those expressed or implied in the forward-looking statements. For those statements, we claim the protection of the safe harbor for forward-looking
statements contained in the U.S. Private Securities Litigation Reform Act of 1995. Such risks, uncertainties and other factors include, without limitation: (1) the effect of economic conditions in the
industries and markets in which we operate in the U.S. and globally and any changes therein, including financial market conditions, fluctuations in commodity prices, interest rates and foreign currency
exchange rates, levels of end market demand in construction and in both the commercial and defense segments of the aerospace industry, levels of air travel, financial condition of commercial airlines,
the impact of weather conditions and natural disasters and the financial condition of our customers and suppliers; (2) challenges in the development, production, delivery, support, performance and
realization of the anticipated benefits of advanced technologies and new products and services; (3) future levels of indebtedness and capital spending and research and development spending; (4)
future availability of credit and factors that may affect such availability, including credit market conditions and our capital structure; (5) the timing and scope of future repurchases of our common stock,
which may be suspended at any time due to various factors, including market conditions and the level of other investing activities and uses of cash; (6) delays and disruption in delivery of materials and
services from suppliers; (7) company and customer- directed cost reduction efforts and restructuring costs and savings and other consequences thereof; (8) the scope, nature, impact or timing of
acquisition and divestiture activity, including among other things integration of acquired businesses into our existing businesses and realization of synergies and opportunities for growth and innovation;
(9) new business opportunities; (10) our ability to realize the intended benefits of organizational changes; (11) the anticipated benefits of diversification and balance of operations across product lines,
regions and industries; (12) the outcome of legal proceedings, investigations and other contingencies; (13) pension plan assumptions and future contributions; (14) the impact of the negotiation of
collective bargaining agreements and labor disputes; (15) the effect of changes in political conditions in the U.S. and other countries in which we operate, including the effect of changes in U.S. trade
policies or the U.K.'s pending withdrawal from the EU, on general market conditions, global trade policies and currency exchange rates in the near term and beyond; and (16) the effect of changes in
tax, environmental, regulatory (including among other things import/export) and other laws and regulations in the U.S. and other countries in which we operate. For additional information identifying
factors that may cause actual results to vary materially from those stated in forward-looking statements, see our reports on Forms 10-K, 10-Q and 8-K filed with or furnished to the SEC from time to
time. Any forward-looking statement speaks only as of the date on which it is made, and we assume no obligation to update or revise such statement, whether as a result of new information, future
events or otherwise, except as required by applicable law.
Akhil Johri
EVP & Chief Financial Officer
United Technologies
Agenda
8:00 – 8:05
Opening Remarks
Johri
8:05 – 8:50
CCS / Q&A
McDonough
8:50 – 9:30
Otis / Q&A
Delpech
9:30 – 9:35
Closing Remarks
Johri
9:35 – 9:45
Tour Overview
Vining
9:45 – 10:00
Break
10:00 – 11:00
Showroom / Tour
All
Bob McDonough
President, UTC Climate, Controls & Security
UTC Climate, Controls & Security
Segment
Product Line
Fire &
Security
(2016 @ afx)
Aftermarket
Aftermarket
HVAC
New
New equipment
equipment
Refrigeration
Sales*
Geography
$16.9 billion
Operating profit**
$3.1 billion
Operating margin
18.1%
Employees
Minority JVs
~56,500
Asia
Americas
Americas
Asia
EMEA
EMEA
*Excludes unconsolidated JV sales of ~$6B
**Excludes restructuring and other significant items – see appendix for definition and reconciliation
~$6B
1
Industry Leadership Positions
(2016 @ afx)
HVAC
Fire & Security
Refrigeration
$8B
$5B
$4B
2
Value Creation
Growth
Engineering headcount
15%
2012
2016
Innovation
Iconic brands
Building solutions
M&A opportunities
Performance
Overhead % of sales
Cumulative restructuring spend
~$500M
Free cash flow*
~100% of NI
~150 bps
2012
Market fundamentals
*See appendix for definition and reconciliation of free cash flow
2016
Cost leadership
2012 2013 2014 2015 2016
2012 2013 2014 2015 2016
Operations excellence
Cash generation
3
CCS Priorities
($ billions @ cfx)
Performance
CAGR 2013 - 2016
Op Profit* expectation
Sales: 3%
$150 – 200M @ cfx
Op Profit*:
$100 – 150M @ afx
8%
Organic revenue growth
3.0
2.8
2.6
Organic** expectation
2.4
Low single digit
Op profit*
16.6
16.2
Sales
15.1
Sales force investment
15.3
7%
Innovation
12%
9%
10%
7%
Cash generation
Organic**
ROS*
1%
3%
3%
(1%)
2013
2014
2015
2016
16.0%
17.3%
17.4%
18.1%
2017E
See appendix for reported sales and adjusted operating profit (afx)
*Excludes restructuring and other significant items – see appendix for definition and reconciliation
**See appendix for definition and reconciliation of organic sales
4
2017 Organic Sales Outlook
Segment
Geographic
up mid single digit
NA Residential HVAC
Commercial HVAC
up low single digit
F&S products
up low single digit
F&S field
up low single digit
Commercial refrigeration
up low single digit
Transport refrigeration
See appendix for definition and reconciliation of organic sales
Refrigeration
Asia
Up low single digit
Up low single
digit
EMEA
Up low single
digit
Americas
Up low single
digit
flat
5
North America Residential HVAC
Growth drivers
Market fundamentals
Growing installed base
Split systems segment
New construction momentum
Segment, units, M
Installed base, units, M
0.0
12
120
0.0
10
100
0.0
8
80
0.0
6
60
0.0
4
New construction
0.0
2
Add-on replacement
0.0
0
01 01
Continue share growth
Develop new customers and channels
40
20
0
03
Source: AHRI, Internal estimates
05
07
09
11
13
15
17E
6
Commercial HVAC
Market fundamentals
Growth drivers
U.S. non-residential construction
Light commercial segment growth
(VPY %)
25%
Product platform revitalization
15%
5%
Regulatory changes
(5%)
(15%)
Broaden service portfolio
(25%)
09
10
11
12
13
14
15
16
17E
Europe non-residential construction
(VPY %)
10%
5%
0%
(5%)
(10%)
09
10
Source: FW Dodge/McGraw Hill, Euroconstruct
11
12
13
14
15
16
17E
7
Fire & Security
Fire & Security
Growth drivers
$5B
New products
Fire & Security
Field
Oil and gas stabilization
Fire & Security
Products
Recurring service focus
Vertical / geographic market focus
Field sales
(% of total)
Service
2012 - 2016
6 pts
Install
2012
2016
8
Refrigeration
Market fundamentals
Growth drivers
U.S. Class 8 truck shipments
40
(000 units)
Europe Truck / Trailer
30
20
Emerging market penetration
10
0
11
12
13
14
15
16
17E
New product introductions
Shipping industry profitability
Expand into new channels
($B)
10
5
0
(5)
(10)
11
12
13
14
15
16
17E
Global hypermarkets and supermarkets
(000 units)
50
45
40
35
30
11
12
13
Source: ACT, Drewry, Planet Retail, internal estimates
14
15
16
17E
9
Innovation
E&D investment
($B)
2012 - 2016
~15%
Large tonnage centrifugal
2012
2014
Enterprise access
2016
v
Product vitality*
(% of sales)
2014 - 2017E
~10%
Low GWP chiller
2014
2015
*Products released in past 36 months, excluding transport refrigeration
VRF
Smart home system
2017E
10
Digital Innovation
Intelligent Buildings
Connected Home
Smart Cold Chain
Trace forward
Trace back
CCS Sales
Mechanical
Digital Engineering Headcount
2012 - 2017E
~45%
Software
- based
Electro-mechanical
2012
2013
2014
2015
2016 2017E
11
UTC Building Solutions Growth
Intelligent products
Connected systems
Integrated buildings
Strategic accounts / verticals
Consultative selling
Advanced building solutions
World’s first combined HVAC
recovery for data centers
High temperature
district heating solution
12
Market Growth Fundamentals
Urbanization
Adoption
(Global urban population, billions)
(Commercial fire detection spend per capita)
4.7
4.3
4.0
3.6
3.2
2.9
2.6
95
00
05
10
15
20E
25E
U.S.
Replacement
Europe
China
Energy efficiency
(U.S. splits installed base, units M)
Avg life
~15 yrs
(Global green building construction spend)
100
Doubling every
3 years
75
50
25
0
75
80
85
90
95
00
05
10
15
16
Source: United Nations: World Urbanization Prospects, 2014 revision; Green Market Size: McGraw Hill Construction Dodge, 2014; Internal estimates
2012
2015
2018E
13
CCS 2020 Outlook
0.0
Sales ($B, cfx)
Operating profit* ($B, cfx)
2016 – 20E
CAGR
Operating profit* ($B, afx)
3 - 20.00
5%
0.0
15.3
16.2
Growth
16.6
6 - 8%
0.0
15.00
Innovation
0.0
2.6
3.0
2.8
10.00
0.0
5.00
Commercial excellence
0.0
-
-
2014
2015
2016
2017E
2020E
Financial performance
2017 expectations
Actual FX (afx)
Constant FX (cfx)
Reported sales: up slightly
Organic sales**: up low single
Operating profit*: $100 – 150M
Operating profit*: $150 – 200M
See appendix for reported sales and adjusted operating profit (afx)
*Excludes restructuring and other significant items – see appendix for definition and reconciliation
**See appendix for definition and reconciliation of organic sales
14
Philippe Delpech
President, Otis
Industry Leadership
Industry
Sales
($ billions)
17%
Attractive growth fundamentals
11.9
All
others
+20%
A
B
Global scale and balance
A
C
B
C
Operating profit
2016 sales: ~$69 billion
Large and growing portfolio
($($
billions)
billions)
2.1
+50%
Otis
Productivity runway on service
B
Asia
A
C
Portfolio
EMEA
(units, millions)
Best-in-class cash flow
1.9
+30%
Americas
Note: Comparable 2015 industry sales: ~$70 billion; A, B, C represent industry peers
Source: Public company reports & internal estimates
2016 sales: $11.9 billion
A
C
B
1
Strategy
Initiatives
Accelerate innovation
Otis NE share of segment
(in units)
Operations excellence
New equipment growth
Service transformation
Source: Internal estimates
2010
2013
2016
2
Accelerate Innovation
Priorities
R&D spend, $ millions, @ cfx
% of sales
1.4%
1.1%
1.6%
Leverage capabilities
1.1%
Accelerate programs
Address product gaps
2014
2015
2016
2017E
Design for service
~4X
vs. ‘14
10
sustaining
centers
2014
2015
2016
New product launches
Down ~66%
vs. ‘16
3 lead
design
centers
2017E
2016
Engineering FTE leverage
2017E
2018E
China platform rationalization
New lead design center in China
3
Operations Excellence
Global operations footprint
Supply chain
(Manufacturing sq. ft.)
(Number of suppliers)
Down
11%
2015
Down
10%
Down
15%
2016
Target
(Location mix, sq. ft.)
2015
2016
Down
20%
Target
(Field product spend example)
20
High
cost
Low
cost
$M per
supplier
10
22K suppliers
~80% less than $10K / supplier
2015
0
4
New Equipment Growth – China
Global segment
China transformation
Deploy segmentation
Otis
position
Leverage multiple brands
Maximize operations scale
ROW
China
China segment
(unit bookings)
#1
Otis
+4%
#2
2016 sales: ~$34B
China
segment
2015
(5%)
2016
Down
low-mid
single
Infrastructure development
Otis
2017E
China metro segment - 2016
Source: Internal estimates
5
New Equipment Growth – Rest of World
ROW segment
Growth strategy
Expand sales coverage & efficiency
#1
Otis
position
Enhance product offering
MEA
#1
#1
Americas
Asia
(ex. China)
Align incentives for profitable growth
2016 orders VPY
13%
(@ cfx)
11%
Otis ex. China
5%
2%
Europe
#1
2016 sales: ~$19B
(28%)
Europe
Source: Internal estimates
Asia
(ex. China)
Americas
MEA
6
Maintenance
(@ cfx)
Portfolio
Europe maintenance
(Financial performance per unit, indexed)
Revenue
Cost
ROW
China
EMEA
Americas
103
100
90
2016: 1.9M units
Portfolio growth
CAGR 2%
2010
2010
2013
2013
2016
2016
7
Service Transformation
Mechanic time
Portfolio dynamics
Conversions
Non-value
added
Value
added
Recaptures
Cancellations
~60 million hours
Field productivity
+
+
-
Customer retention
Deploy enhanced digital tools
8
Service Transformation Schedule
3/10
Deployment
2016
2017
2018
(New mobility devices)
~31,000
Strategy
~16,000
Preparation
1,300
2016
2017E
2018E
Execution
Mobility & Apps
Remote / IoT
Enterprise Systems
Pilot
Development
Development
2017 - 2018 objectives
Deployment
Pilot
Deployment
Pilot
Mobility & Apps
Customer Retention
Smart Service
Enterprise Systems
Productivity
Remote / IoT
Deployment
9
Service Transformation Impact
Hong Kong deployment
Expected benefits
Cancellations
Callbacks
Maintenance hours
Overhead
Recaptures
10
Key Metrics
(5-year CAGR)
New equipment growth
(Orders)
2015
(5-year CAGR)
China flat
ROW ~5%
7%
2010
(@ cfx)
2016
2020E
Service transformation
(R&D investment)
2%
2010
(5-year CAGR)
(China service conversion rate)
Accelerate innovation
2015
(@ cfx)
~15%
2016
Service transformation
(Maintenance portfolio)
2020E
(units)
>50%
33%
24%
2%
2010
2015
2016
2020E
2010
2015
~3%
2016
2020E
11
Otis 2020 Outlook
18.0
Sales ($B, cfx)
Operating profit* ($B, cfx)
2016 – 20E
CAGR
16.0
2016-20
3 - 5%
CAGR
Operating profit* ($B, afx)
Accelerate innovation
14.0
11.2
11.5
11.7
12.0
10.0
Operations excellence
3 - 5%
8.0
2.3
2.3
2.1
6.0
New equipment growth
4.0
2.0
Service transformation
-
2014
2015
2016
2017E
2020E
2017 expectations
See appendix for reported sales and adjusted operating profit (afx)
*Excludes restructuring and other significant items – see appendix for definition and reconciliation
**See appendix for definition and reconciliation of organic sales
Actual FX (afx)
Constant FX (cfx)
Reported sales: up slightly
Organic sales**: up low single
Operating profit*: ($175) – (125M)
Operating profit*: ($100) – (50M)
12
Factory Tour
North America
(@ cfx)
Performance
Profit contribution
(Indexed)
(2016)
Total sales
New
equipment
332
New equipment backlog
Service
144
100
2010
2013
2016
Otis awards (2016)
Priorities
Deliver service & digital transformation
Execute NE backlog & service
Continue NE & Mod orders growth
Willis Tower Mod
LAX Midfield Terminal* Texas Children’s Hospital
*Photograph provided by Los Angeles World Airports
1
North America Operations Transformation
2011
2016
Nogales 1
Nogales 2
Nogales 3
Bloomington, IN
Florence, SC
Changing the
Status Quo
2000
Stabilization
2004
(Indexed)
1.0
Bloomington
Direct employees
0.8
Outsourcing 0.9
Nogales
Contract
factoryActual hours
1.0
0.6
Vertically
integrated
 Cost reduction1.5
1.0
Shipments
Traditional Organization
7
Platforms
3
 Modularity
1.0
Floor space
Structure
Nogales/Bloomin
 Growth
Scattered Org2
North America Transformation Results
Florence factory
Results
(Shipment units, indexed)
2013
100
2013
133
2016
(Factory sales, indexed)
100
2016
2013
139
2016
(Cost of poor quality, indexed)
100
2013
65
2016
3
Appendix and GAAP Reconciliations
Use and Definitions of Non-GAAP Financial Measures
We supplement the reporting of our financial information determined under accounting principles generally accepted in the United States ("GAAP") with certain non-GAAP financial information. The
non-GAAP information presented provides investors with additional useful information, but should not be considered in isolation or as substitutes for the related GAAP measures. Moreover, other
companies may define non-GAAP measures differently, which limits the usefulness of these measures for comparisons with such other companies. We encourage investors to review our financial
statements and publicly-filed reports in their entirety and not to rely on any single financial measure.
Adjusted net sales, organic sales, adjusted operating profit and adjusted diluted EPS are non-GAAP financial measures. Adjusted net sales represents consolidated net sales from continuing
operations (a GAAP measure), excluding significant items of a non-recurring and/or nonoperational nature (hereinafter referred to as “other significant items”). Organic sales represents consolidated
net sales (a GAAP measure), excluding the impact of foreign currency translation, acquisitions and divestitures completed in the preceding twelve months and other significant items. Adjusted
operating profit represents income from continuing operations (a GAAP measure), excluding restructuring costs and other significant items. Adjusted diluted EPS represents diluted earnings per share
from continuing operations (a GAAP measure), excluding restructuring costs and other significant items. For the business segments, when applicable, adjustments of net sales, operating profit and
margins similarly reflect continuing operations, excluding restructuring and other significant items. Management believes that the non-GAAP measures just mentioned are useful in providing period-toperiod comparisons of the results of the Company’s ongoing operational performance.
Free cash flow is a non-GAAP financial measure that represents cash flow from operations (a GAAP measure) less capital expenditures. Management believes free cash flow is a useful measure of
liquidity and an additional basis for assessing UTC's ability to fund its activities, including the financing of acquisitions, debt service, repurchases of UTC's common stock and distribution of earnings to
shareholders.
A reconciliation of the non-GAAP measures to the corresponding amounts prepared in accordance with GAAP appears in the tables in this Appendix. The tables provide additional information as to the
items and amounts that have been excluded from the adjusted measures.
When we provide our expectation for adjusted EPS, adjusted operating profit, organic sales and/or free cash flow on a forward-looking basis, a reconciliation of the differences between the non-GAAP
expectations and the corresponding GAAP measures (expected diluted EPS and operating profit from continuing operations, expected cash flow from operations and sales) generally is not available
without unreasonable effort due to potentially high variability, complexity and low visibility as to the items that would be excluded from the GAAP measure in the relevant future period, such as unusual
gains and losses, the ultimate outcome of pending litigation, fluctuations in foreign currency exchange rates, the impact and timing of potential acquisitions and divestitures, and other structural changes
or their probable significance. The variability of the excluded items may have a significant, and potentially unpredictable, impact on our future GAAP results.
UTC 2017 Expectations
Adjusted EPS*
$6.30 – $6.60
Sales
$57.5 – $59B
2 – 4%
Organic Sales**
Free cash flow***
90 – 100%
of net income attributable to
common shareowners
*Excludes restructuring and other significant items – see the Use and Definitions of Non-GAAP Financial Measures in this appendix for definition
**See the Use and Definitions of Non-GAAP Financial Measures in this appendix for definition of organic sales
***See the Use and Definitions of Non-GAAP Financial Measures in this appendix for definition of free cash flow
*Excludes restructuring & certain other items
2017 Expectations
(% organic sales change)
Commercial sales
Elevator new equipment
Elevator service
Total Otis
Americas
EMEA
Asia
Total
up mid teens
up low/mid single digit
down mid single digit
up low single digit
up mid single digit
up slightly
up high single digit
up low/mid single digit
up high single digit
up low single digit
flat
up low single digit
Americas
EMEA
Asia
Total
Residential HVAC
up mid single digit
Commercial HVAC
up low single digit
flat
up mid single digit
up low single digit
Fire & Security product
up mid single digit
up low single digit
up low single digit
up low single digit
up low single digit
up low single digit
up low single digit
Fire & Security field
up mid single digit
Transport refrigeration
flat
Commercial refrigeration
Total CCS
up low single digit
up low single digit
up low single digit
up low single digit
up low single digit
Otis 2017 Expectations
($ millions)
Sales
Reported
Organic
up slightly
up low single digit
Adjusted Operating Profit*
Excluding FX
($100) – (50M)
Including FX
($175) – (125M)
Adjusted Operating Profit* Drivers
Volume
+
75 – 125
Net productivity / restructuring
+
~75
Price / mix
–
~175
Strategic investment / R&D
–
~75
2017 expectations (Excluding FX)
–
($100) – (50M)
FX
–
~75
2017 expectations (Including FX)
–
($175) – (125M)
*Excludes restructuring and other significant items – see the Use and Definitions of Non-GAAP Financial Measures in this appendix for definition
CCS 2017 Expectations
($ millions)
Sales
Reported
Organic
Adjusted Operating Profit* Drivers
up slightly
up low single digit
Adjusted Operating Profit*
Volume / mix
+
100 – 150
Net productivity / restructuring
+
~50
Commodities / price
+
~25
Pension
+
~25
Excluding FX
+ $150 – 200M
R&D / other
–
~50
Including FX
+ $100 – 150M
2017 expectations (Excluding FX)
+
$150 – 200M
FX
–
~50
2017 expectations (Including FX)
+
$100 – 150M
*Excludes restructuring and other significant items – see the Use and Definitions of Non-GAAP Financial Measures in this appendix for definition
Pratt & Whitney 2017 Expectations
($ millions)
Reported Sales
Adjusted Operating Profit**
up high single digit
down ($200) – (150M)
Organic – up high single digit
Commercial OE*
Commercial AM*
Military OE
up ~20%
up low single
digit
Commercial OE mix
–
~350
Commercial aftermarket
+
50 – 75
Military
+
50 – 75
Pension
+
~35
2016 contract agreements / other
–
~110
up mid-teens
2017 expectations (Excluding FX)
Military AM
up mid single
digit
FX
2017 expectations (Including FX)
*Includes large commercial and P&W Canada
**Excludes restructuring and other significant items – see the Use and Definitions of Non-GAAP Financial Measures in this appendix for definition
($325) – (275M)
+
~125
($200) – (150M)
Aerospace Systems 2017 Expectations
($ millions)
Reported Sales
Adjusted Operating Profit*
up low single digit
up $50 – 100M
Organic – up low single digit
Commercial OE
Commercial AM
Military OE
Military AM
up low single
digit
up low/mid single
digit
up mid single
digit
up low single
digit
Commercial OE mix
–
Product cost reduction
+
~250
Commercial AM / Military
+
75 – 100
R&D
+
~25
Pension
+
~25
$25 – 75M
2017 expectations (Excluding FX)
FX
2017 expectations (Including FX)
Bar chart is organic sales
*Excludes restructuring and other significant items – see the Use and Definitions of Non-GAAP Financial Measures in this appendix for definition
350 – 325
+
~25
$50 – 100M
Segment Data – GAAP
UNITED TECHNOLOGIES CORPORATION
SEGMENT DATA - Reported
($ Millions except per share amounts)
Otis
Net Sales
Operating Profit (a)
Operating Profit %
UTC Climate, Controls & Security
Net Sales
Operating Profit (a), (b), (e), (n), (o), (s)
Operating Profit %
Pratt & Whitney
Net Sales (g), (p)
Operating Profit (a), (f), (g), (p)
Operating Profit %
UTC Aerospace Systems
Net Sales (h)
Operating Profit (a), (h), (i)
Operating Profit %
Total Segments
Net Sales
Operating Profit
Operating Profit %
Corporate, Eliminations, and Other
Net Sales:
Other
Operating Profit:
General corporate expenses (a)
Eliminations and other (a), (j), (k), (t)
Consolidated
Net Sales
Operating Profit
Operating Profit %
Interest expense, net (q), (u), (v)
Income from continuing operations before income taxes
Income tax expense (l), (m), (r), (w), (x)
Income from continuing operations
1st
Qtr.
2,715
466
17.2%
3,728
606
16.3%
3,588
410
11.4%
3,505
538
15.3%
13,536
2,020
3,097
581
18.8%
4,459
872
19.6%
3,813
386
10.1%
3,716
582
15.7%
15,085
2,421
4th
Qtr.
3,018
584
19.4%
4,415
801
18.1%
3,501
340
9.7%
3,646
600
16.5%
14,580
2,325
2016
Total
3,063
516
16.8%
4,249
677
15.9%
3,992
409
10.2%
3,598
578
16.1%
14,902
2,180
1st
Qtr.
11,893
2,147
18.1%
16,851
2,956
17.5%
14,894
1,545
10.4%
14,465
2,298
15.9%
58,103
8,946
2015
3rd
Qtr.
2nd
Qtr.
2,745
527
19.2%
3,852
729
18.9%
3,332
419
12.6%
3,548
569
16.0%
13,477
2,244
3,098
627
20.2%
4,454
823
18.5%
3,677
487
13.2%
3,632
580
16.0%
14,861
2,517
3,043
642
21.1%
4,279
771
18.0%
3,234
419
13.0%
3,457
572
16.5%
14,013
2,404
4th
Qtr.
2015
Total
3,094
542
17.5%
4,122
613
14.9%
3,839
(464)
-12.1%
3,457
167
4.8%
14,512
858
11,980
2,338
19.5%
16,707
2,936
17.6%
14,082
861
6.1%
14,094
1,888
13.4%
56,863
8,023
14.9%
16.0%
15.9%
14.6%
15.4%
16.7%
16.9%
17.2%
5.9%
14.1%
(179)
(211)
(226)
(243)
(859)
(157)
(171)
(225)
(212)
(765)
(91)
16
(97)
13
(92)
18
(126)
(415)
(406)
(368)
(110)
48
(120)
18
(101)
(1)
(133)
(333)
(464)
(268)
13,357
1,945
14,874
2,337
14,354
2,251
14,659
1,639
57,244
8,172
13,320
2,182
14,690
2,415
13,788
2,302
14,300
392
14.6%
15.7%
15.7%
11.2%
14.3%
16.4%
16.4%
16.7%
2.7%
(223)
(225)
(225)
(366)
(1,039)
(217)
(217)
(184)
(206)
1,722
(469)
1,253
Income (loss) from discontinued operations (c), (d)
Net income
2016
3rd
Qtr.
2nd
Qtr.
2,112
(587)
1,525
11
1,264
Less: Noncontrolling interest in subsidiaries' earnings
2,026
(492)
1,534
(47)
1,478
(81)
1,273
(149)
1,124
37
1,571
(99)
(91)
7,133
(1,697)
5,436
(11)
1,113
(100)
1,965
(530)
(626)
1,435
1,572
63
80
1,498
1,652
(10)
5,426
2,198
(371)
(72)
2,118
(592)
1,526
(65)
1,461
(110)
56,098
7,291
13.0%
(824)
186
6,467
(363)
(2,111)
(177)
4,356
3,532
3,610
3,355
7,966
(99)
(77)
(358)
Net income attributable to common shareowners
1,183
1,379
1,480
1,013
5,055
1,426
1,542
1,362
3,278
7,608
Net income attributable to common shareowners:
Income from continuing operations
Income (loss) from discontinued operations
1,172
11
1,426
(47)
1,443
37
1,024
(11)
5,065
(10)
1,364
62
1,461
81
1,427
(65)
(256)
3,534
3,996
3,612
1st
Qtr.
2nd
Qtr.
3rd
Qtr.
4th
Qtr.
2016
Total
1st
Qtr.
2nd
Qtr.
3rd
Qtr.
4th
Qtr.
2015
Total
Continuing Operations
Earnings per share - basic
Earnings per share - diluted
1.42
1.41
1.73
1.71
1.76
1.74
1.28
1.26
6.19
6.13
1.53
1.51
1.67
1.64
1.63
1.61
(0.30)
(0.30)
4.58
4.53
0.01
(0.06)
0.04
(0.01)
(0.01)
0.07
0.09
(0.07)
4.16
4.14
0.01
(0.06)
0.04
(0.01)
(0.01)
0.07
0.09
(0.07)
4.16
4.09
Total basic earnings per share
1.43
1.67
1.80
1.26
6.18
1.60
1.76
1.55
3.86
8.72
Total diluted earnings per share
1.42
1.65
1.78
1.25
6.12
1.58
1.73
1.54
3.86
8.61
825.0
831.3
825.3
833.6
822.4
831.2
802.0
810.3
818.2
826.1
890.3
904.2
877.3
889.4
876.4
885.0
849.6
849.6
872.7
883.2
Q1
27.2%
Q2
27.8%
Q3
24.3%
Q4
11.7%
Q1
27.0%
Q2
28.5%
Q3
28.0%
Q4
194.8%
Discontinued Operations
Earnings (loss) per share - basic
Earnings (loss) per share - diluted
Total EPS attributable to common shareowners
Weighted average number of shares outstanding (m illions)
Basic shares
Diluted shares
Effective Tax Rate - continuing ops
Total
23.8%
Total
32.6%
Segment Data – Notes
The earnings release and conference-call discussion adjust 2016 and 2015 segment results for Restructuring costs as well as certain Significant non-recurring and non-operational items.
The following Restructuring costs and Significant non-recurring and/or non-operational items are included in current and prior year GAAP results and have been excluded from the adjusted results (non-GAAP
measures) presented in the earnings release and conference-call discussion.
(a) Restructuring costs as included in 2016 and 2015 results:
2016
Q1
Operating Profit:
Otis
UTC Climate, Controls & Security
Pratt & Whitney
UTC Aerospace Systems
Total Segments
General corporate expenses
Eliminations and other
Total within continuing operations
Total within discontinued operations
Total UTC
Q2
(15)
(28)
(5)
(13)
(61)
(1)
(62)
(62)
2015
Restructuring Costs
Q3
Q4
(16)
(25)
(66)
(8)
(115)
(1)
(116)
(116)
(10)
(18)
21
(11)
(18)
(1)
(4)
(23)
(23)
Total
(18)
6
(61)
(17)
(90)
1
(89)
(89)
Q1
(59)
(65)
(111)
(49)
(284)
(1)
(5)
(290)
(290)
Q2
(6)
(24)
(13)
(50)
(93)
(93)
(93)
Restructuring Costs
Q3
Q4
(8)
(28)
(2)
(38)
(1)
(39)
(23)
(62)
(18)
(15)
(22)
(14)
(69)
(4)
(73)
(116)
(189)
Total
(19)
(41)
(68)
(47)
(175)
(5)
(11)
(191)
(191)
(b) Q1 2015: Approximately $126 million gain as a result of a fair value adjustment related to the acquisition of a controlling interest in a UTC Climate, Controls & Security joint venture investment.
(c) Q2 2015: Approximately $28 million of transaction and separation costs related to the planned sale or spin-off of Sikorsky.
(d) Q3 2015: Approximately $68 million of tax provision related to the undistributed earnings of Sikorsky's foreign subsidiaries, which will no longer be permanently reinvested as a result of the announced sale of
Sikorsky to Lockheed Martin Corp.
(e) Q4 2015: Approximately $5 million charge related to UTC Climate, Controls & Security acquisitions and integration costs.
(f) Q4 2015: Approximately $867 million charge related to a Pratt & Whitney research and development support agreement with the Canadian government.
(g) Q4 2015: Approximately $142 million to record in sales and $80 million in losses from Pratt & Whitney customer contract renegotiations.
(h) Q4 2015: Approximately $210 million to record in sales and $295 million in losses from UTC Aerospace Systems customer contract renegotiations.
(i) Q4 2015: Approximately $61 million charge to UTC Aerospace Systems for impairment of assets held for sale.
(j) Q4 2015: Approximately $237 million charge for pending and future asbestos-related claims.
(k) Q4 2015: Approximately $27 million charge from agreement with a state taxing authority for monetization of tax credits.
(l) Q4 2015: Approximately $274 million of unfavorable income tax accruals related to the repatriation of foreign earnings.
(m) Q4 2015: Approximately $69 million of unfavorable income tax accruals related to a change in tax laws.
(n) Q2 2016: Approximately $12 million of acquisition and integration costs related to UTC Climate, Controls & Security.
(o) Q3 2016: Approximately $11 million of acquisition and integration costs related to UTC Climate, Controls & Security.
(p) Q3 2016: Approximately $184 million to record in sales and $95 million in losses from Pratt & Whitney on-going customer contract negotiations.
(q) Q3 2016: Approximately $2 million of favorable pre-tax interest adjustments related to the IRS conclusion of Goodrich Corporation's 2011-2012 tax years.
(r) Q3 2016: Approximately $56 million of favorable income tax adjustments related to the IRS conclusion of Goodrich Corporation's 2011-2012 tax years.
(s) Q4 2016: Approximately $9 million of acquisition and integration costs related to UTC Climate, Controls & Security.
(t) Q4 2016: Approximately $423 million of pension settlement charges resulting from defined benefit plan derisking actions.
(u) Q4 2016: Approximately $164 million of net extinguishment loss from early redemption of debt.
(v) Q4 2016: Approximately $22 million of favorable pre-tax interest adjustments related to the IRS conclusion of 2011-2012 tax years.
(w) Q4 2016: Approximately $150 million of favorable income tax adjustments related to the IRS conclusion of 2011-2012 tax years.
(x) Q4 2016: Approximately $25 million of favorable income tax adjustments related to changes in French tax laws
(51)
(108)
(105)
(111)
(375)
(9)
(12)
(396)
(139)
(535)
Segment Data – Adjusted
UNITED TECHNOLOGIES CORPORATION
SEGMENT DATA - Adjusted/Non-GAAP (Unaudited)
($ Millions except per share amounts)
2016
Ex Rest & Significant non-recurring and non-operational
items
1st
Qtr.
2nd
Qtr.
3rd
Qtr.
4th
Qtr.
2016
FY
2015
Ex Rest & Significant non-recurring and non-operational
items
1st
Qtr.
2nd
Qtr.
3rd
Qtr.
4th
Qtr.
2015
FY
Otis
Net Sales
Operating Profit (a)
Operating Profit %
2,715
481
17.7%
3,097
597
19.3%
3,018
594
19.7%
3,063
534
17.4%
11,893
2,206
18.5%
2,745
533
19.4%
3,098
635
20.5%
3,043
660
21.7%
3,094
561
18.1%
11,980
2,389
19.9%
UTC Climate, Controls & Security
Net Sales
Operating Profit (a), (b), (e), (n), (o), (s)
Operating Profit %
3,728
634
17.0%
4,459
909
20.4%
4,415
830
18.8%
4,249
680
16.0%
16,851
3,053
18.1%
3,852
627
16.3%
4,454
851
19.1%
4,279
786
18.4%
4,122
659
16.0%
16,707
2,923
17.5%
Pratt & Whitney
Net Sales (g), (p)
Operating Profit (a), (f), (g), (p)
Operating Profit %
3,588
415
11.6%
3,813
452
11.9%
3,685
414
11.2%
3,992
470
11.8%
15,078
1,751
11.6%
3,332
432
13.0%
3,677
489
13.3%
3,234
441
13.6%
3,981
551
13.8%
14,224
1,913
13.4%
UTC Aerospace Systems
Net Sales (h)
Operating Profit (a), (h), (i)
Operating Profit %
3,505
551
15.7%
3,716
590
15.9%
3,646
611
16.8%
3,598
595
16.5%
14,465
2,347
16.2%
3,548
619
17.4%
3,632
580
16.0%
3,457
586
17.0%
3,667
570
15.5%
14,304
2,355
16.5%
Total Segments
Net Sales
Operating Profit
Operating Profit %
13,536
2,081
15,085
2,548
14,764
2,449
14,902
2,279
58,287
9,357
13,477
2,211
14,861
2,555
14,013
2,473
14,864
2,341
57,215
9,580
15.4%
16.9%
16.6%
15.3%
16.1%
16.4%
17.2%
17.6%
15.7%
16.7%
(179)
(211)
(226)
(243)
(859)
(157)
(171)
(225)
(212)
(765)
(91)
(97)
(91)
(126)
(405)
(110)
(120)
(97)
(128)
(455)
17
14
22
60
48
19
(1)
(58)
-
Corporate, Eliminations, and Other
Net Sales:
Other
Operating Profit:
General corporate expenses (a)
Eliminations and other (a), (j), (k), (t)
Task/(Contingency)
7
-
-
-
-
-
-
-
-
13,357
2,007
14,874
2,465
14,538
2,380
14,659
2,160
57,428
9,012
13,320
2,149
14,690
2,454
13,788
2,375
8
-
Consolidated
Net Sales
Operating Profit
Operating Profit %
Interest expense, net (q), (u), (v)
Income from continuing operations before income taxes
Income tax expense (l), (m), (r), (w), (x)
Income from continuing operations
Income (loss) from discontinued operations (c), (d)
Net income
Less: Noncontrolling interest in subsidiaries' earnings
14,652
2,155
56,450
9,133
15.0%
16.6%
16.4%
14.7%
15.7%
16.1%
16.7%
17.2%
14.7%
16.2%
(223)
(225)
(227)
(224)
(899)
(217)
(217)
(184)
(206)
(824)
1,784
(489)
1,295
11
1,306
(81)
2,240
(627)
1,613
(47)
1,566
(99)
2,153
(600)
1,553
37
1,590
(91)
1,936
(566)
1,370
(11)
1,359
(100)
8,113
(2,282)
5,831
(10)
5,821
(371)
1,932
(560)
2,237
(641)
1,372
1,596
63
80
1,435
1,676
(72)
(110)
2,191
(613)
1,578
(65)
1,513
(99)
1,949
(572)
8,309
(2,386)
1,377
5,923
3,532
3,610
4,909
9,533
(77)
(358)
Net income attributable to common shareowners
1,225
1,467
1,499
1,259
5,450
1,363
1,566
1,414
4,832
9,175
Net income attributable to common shareowners:
From continuing operations
From discontinued operations
1,214
11
1,514
(47)
1,462
37
1,270
(11)
5,460
(10)
1,301
62
1,485
81
1,479
(65)
1,298
3,534
5,563
3,612
2016 Full Year Sales Reconciliation
Total Growth
Organic
FX
Net Acquisitions
Other
Otis
(1%)
1%
(2%)
0%
0%
CCS
1%
(1%)
(1%)
3%
0%
Pratt & Whitney
6%
6%
0%
0%
0%
Aerospace Systems
3%
2%
0%
0%
1%
Total UTC*
2%
2%
(1%)
1%
0%
*Reflects consolidated net sales
EPS Reconciliation
Reconciliation of Diluted Earnings per Share to Adjusted Diluted Earnings per Share
2016
Q3
(dollars in millions except per share amounts)
Q1
Diluted earnings per share attributable to common shareowners
Less: diluted earnings (loss) per share from discontinued operations attributable to
common shareowners
Diluted earnings per share - Net income from continuing operations attributable to
common shareowners (GAAP)
Net income attributable to common shareowners
$
Q2
1.42
$
0.01
1.65
$
(0.06)
Q4
1.78
0.04
$
1.41
$
1.71
$
1.74
$
1,183
$
1,379
$
1,480
Less: Income (loss) from discontinued operations attributable to common shareowners
11
Net income from continuing operations attributable to common shareowners
(47)
1,172
$
1.25
$
(0.01)
$
1.26
$ 1,013
37
1,426
FY
6.12
$
(0.01)
$
2015
Q3
Q2
1.58
$
0.07
1.73
$
0.09
Q4
1.54
$
(0.07)
FY
3.86
$
4.16
$
1.51
$
1.64
$
1.61
$
(0.30) $
$ 5,055
$
1,426
$
1,542
$
1,362
$
3,278
(10)
1,024
5,065
62
81
1,364
1,461
(65)
$
3,534
1,427
8.61
4.09
6.13
(11)
1,443
Q1
4.53
7,608
3,612
(256)
3,996
Adjustments to net income from continuing operations attributable to common
shareowners:
Restructuring costs
(62)
(116)
(23)
(89)
Gain on fair value adjustment on acquisition of controlling interest in a joint venture
-
Acquisition and integration costs related to current period acquisitions
-
Charge related to a research and development support agreement with Canadian
government agencies
-
-
Charge resulting from customer contract negotiations
-
-
Charge for impairment of assets held for sale
-
-
-
-
Charge for pending and future asbestos-related claims
-
-
-
Charge from agreement with a state taxing authority for monetization of tax credits
-
-
-
Pension settlement charge resulting from defined benefit plan de-risking actions
-
-
-
(423)
-
-
-
-
-
20
-
Net extinguishment loss from early redemption of debt, included in interest expense,
net
Other significant non-recurring and non-operational items included in interest expense,
net
Income tax benefit on restructuring costs and significant non-recurring and nonoperational items
Significant non-recurring and non-operational gains (charges) recorded within income
tax expense
Total adjustments to net income from continuing operations attributable to common
shareowners
-
$
1,214
Less: Impact of total adjustments on diluted earnings per share
$
(0.05) $
Adjusted diluted earnings per share - Net income from continuing operations attributable
to common shareowners (Non-GAAP)
$
$
$
(73)
(191)
(396)
-
-
-
-
-
(5)
(5)
-
-
-
(867)
(867)
-
-
-
(375)
(375)
-
-
-
-
(61)
(61)
-
-
-
-
-
(237)
(237)
-
-
-
-
-
(27)
(27)
(423)
-
-
-
-
-
(164)
(164)
-
-
-
-
-
2
22
24
-
-
-
-
-
40
52
242
354
30
15
21
551
617
-
56
175
231
-
-
-
(342)
(342)
(19)
(246)
(395)
(1,554)
(1,567)
(11)
1,514
$
1,462
-
-
$ 1,270
(0.02) $
1.76
(32)
-
(95)
(0.11) $
1.82
(9)
-
$
-
(39)
-
(88)
Adjusted net income from continuing operations attributable to common shareowners
-
(93)
126
(12)
(42)
1.46
-
(290)
$
(95)
$ 5,460
(0.30) $
1.56
$
63
(24)
(52)
$
1,301
$
1,485
(0.48)
$
0.07
$
(0.03) $
6.61
$
1.44
$
1.67
$
$
1,479
$
(0.06) $
1.67
$
1,298
126
$
(1.83) $
1.53
$
5,563
(1.77)
6.30
Free Cash Flow Reconciliation
($ millions)
Net income attributable to common shareowners
from continuing operations
Depreciation & amortization
Change in working capital
Other
Cash flow from operations
Capital expenditures
Free cash flow
Free cash flow as a % of net income
attributable to common shareowners from continuing operations
FY 16
5,065
FY 15
3,996
1,962
(1,161)
546
6,412
(1,699)
4,713
1,863
(769)
1,665
6,755
(1,652)
5,103
93%
128%
UTC Operating Results Reconciliation
($ millions)
Segment Sales
Other significant items of a non-recurring/non-operational nature
Segment sales - adjusted
Segment operating profit
Other significant items of a non-recurring/non-operational nature
Restructuring
Segment operating profit - adjusted
Segment operating margin
Segment operating margin - adjusted
1
1
1
2012
51,443
51,443
2013
57,141
57,141
2014
58,528
58,528
2015
56,863
352
57,215
2016
58,103
184
58,287
7,470
(157)
518
7,831
9,074
(223)
431
9,282
9,777
(31)
349
10,095
8,023
1,182
375
9,580
8,946
127
284
9,357
14.5%
15.2%
15.9%
16.2%
16.7%
17.2%
14.1%
16.7%
15.4%
16.1%
Details of other significant items of a non-recurring/non-operational nature
See Segment operating results reconciliation slides for additional information.
Otis Operating Results Reconciliation
($ millions)
Segment Sales
Other significant items of a non-recurring/non-operational nature
Segment sales - adjusted
2012
12,056
12,056
2013
12,484
12,484
2014
12,982
12,982
2015
11,980
11,980
2016
11,893
11,893
Segment operating profit
Other significant items of a non-recurring/non-operational nature
Restructuring
Segment operating profit - adjusted
2,512
164
2,676
2,590
88
2,678
2,640
87
2,727
2,338
51
2,389
2,147
59
2,206
Segment operating margin
Segment operating margin - adjusted
20.8%
22.2%
20.7%
21.5%
20.3%
21.0%
19.5%
19.9%
18.1%
18.5%
Otis Constant FX Financials
($ billions)
Otis Sales & Operating Profit
Reported Sales (afx)
Adjusted Operating Profit (afx)
2014
13.0
2.7
2015
12.0
2.4
2016
11.9
2.2
Sales @ Constant FX (cfx)
Adjusted Operating Profit @ Constant FX (cfx)
11.2
2.3
11.5
2.3
11.7
2.1
CCS Operating Results Reconciliation
($ millions)
Segment Sales
Other significant items of a non-recurring/non-operational nature
Segment sales - adjusted
Segment operating profit
Other significant items of a non-recurring/non-operational nature
Restructuring
Segment operating profit - adjusted
Segment operating margin
Segment operating margin - adjusted
1
1
1
2012
17,090
17,090
2013
16,809
16,809
2014
16,823
16,823
2015
16,707
16,707
2016
16,851
16,851
2,425
(157)
143
2,411
2,590
(55)
97
2,632
2,782
(30)
116
2,868
2,936
(121)
108
2,923
2,956
32
65
3,053
14.2%
14.1%
15.4%
15.7%
16.5%
17.0%
17.6%
17.5%
17.5%
18.1%
Details of other significant items of a non-recurring/non-operational nature
2012: Approximately $112 million net gain from UTC Climate, Controls & Security’s ongoing portfolio transformation. This net gain includes approximately $215 million from
the sale of a majority interest in a manufacturing and distribution joint venture in Asia, partially offset by $103 million of impairment charges related to planned business dispositions.
Approximately $110 million net gain from UTC Climate, Controls & Security’s ongoing portfolio transformation. This net gain includes approximately $142 million from the sale
of a controlling interest in its Canadian distribution business, partially offset by $32 million loss on the disposition of its U.S. fire and security branch operations.
Approximately $65 million net charge from UTC Climate, Controls & Security’s ongoing portfolio transformation. This net charge includes approximately $24 million of pension
settlement charges.
2013: Approximately $38 million net gain from UTC Climate, Controls & Security's ongoing portfolio transformation. This net gain primarily relates to the sale of a business in Hong Kong.
Approximately $17 million net gain from UTC Climate, Controls & Security's ongoing portfolio transformation, primarily due to a gain on the sale of a business in Australia.
2014: Approximately $30 million net gain from UTC Climate, Controls & Security's ongoing portfolio transformation, primarily due to a gain on the sale of an interest in a joint venture in North America.
2015: Approximately $126 million gain as a result of a fair value adjustment related to the acquisition of a controlling interest in a UTC Climate, Controls & Security joint venture investment.
Approximately $5 million charge related to UTC Climate, Controls & Security acquisitions and integration costs.
2016: Approximately $12 million of acquisition and integration costs related to UTC Climate, Controls & Security.
Approximately $11 million of acquisition and integration costs related to UTC Climate, Controls & Security.
Approximately $9 million of acquisition and integration costs related to UTC Climate, Controls & Security.
CCS Constant FX Financials
($ billions)
CCS Sales & Operating Profit
Reported Sales (afx)
Adjusted Operating Profit (afx)
2013
16.8
2.6
2014
16.8
2.9
2015
16.7
2.9
2016
16.9
3.1
Sales @ Constant FX (cfx)
Adjusted Operating Profit @ Constant FX (cfx)
15.1
2.4
15.3
2.6
16.2
2.8
16.6
3.0
Pratt & Whitney Operating Results Reconciliation
($ millions)
Segment Sales
Other significant items of a non-recurring/non-operational nature
Segment sales - adjusted
Segment operating profit
Other significant items of a non-recurring/non-operational nature
Restructuring
Segment operating profit - adjusted
Segment operating margin
Segment operating margin - adjusted
1
1
1
2012
13,964
2013
14,501
2014
14,508
2015
14,082
2016
14,894
13,964
14,501
14,508
142
14,224
184
15,078
1,589
96
1,685
1,876
(168)
154
1,862
2,000
(1)
64
2,063
861
947
105
1,913
1,545
95
111
1,751
11.4%
12.1%
12.9%
12.8%
13.8%
14.2%
6.1%
13.4%
10.4%
11.6%
Details of other significant items of a non-recurring/non-operational nature
2013: Approximately $193 million gain from the sale of the Pratt & Whitney Power Systems business. This gain was not reclassified to "Discontinued Operations" due to our
expected level of continuing involvement in the business post disposition.
2014: Approximately $83 million net gain, primarily as a result of fair value adjustments related to a business acquisition.
Approximately $60 million charge to adjust the fair value of a Pratt & Whitney joint venture investment.
Approximately $22 million charge for impairment of assets related to a joint venture.
2015: Approximately $142 million to record in sales and $80 million in losses from Pratt & Whitney customer contract renegotiations.
Approximately $867 million charge related to a Pratt & Whitney research and development support agreements with Canadian government agencies.
2016: Approximately $184 million to record in sales and $95 million in losses from Pratt & Whitney on-going customer contract negotiations.
Aerospace Systems Operating Results Reconciliation
($ millions)
Segment Sales
Other significant items of a non-recurring/non-operational nature
Segment sales - adjusted
Segment operating profit
Other significant items of a non-recurring/non-operational nature
Restructuring
Segment operating profit - adjusted
Segment operating margin
Segment operating margin - adjusted
1
1
1
2012
8,334
8,334
2013
13,347
13,347
2014
14,215
14,215
2015
14,094
210
14,304
2016
14,465
14,465
944
115
1,059
2,018
92
2,110
2,355
82
2,437
1,888
356
111
2,355
2,298
49
2,347
11.3%
12.7%
15.1%
15.8%
16.6%
17.1%
13.4%
16.5%
15.9%
16.2%
Details of other significant items of a non-recurring/non-operational nature
2015: Approximately $210 million to record in sales and $295 million in losses from UTC Aerospace Systems customer contract renegotiations.
Approximately $61 million charge to UTC Aerospace Systems for impairment of assets held for sale.