Discussion Agenda 1H 2014 Financial Performance, FY Outlook (as of July 18, 2014) Total Shareowner Return Recent Management Changes And Segment Realignment Honeywell Executive Pay Programs And Policies Voting Results From April…
1H 2014 Financial Performance, FY Outlook (as of July 18, 2014) Important Note: All of the projections of future financial performance in this presentation refer back to Honeywells second quarter earnings presentation on July 18,…
First Half 2014 Financial Summary (M except per share amounts) 1H13 1H14 Sales 19,021 19,932 5% Increase Up 2% Organic Segment Profit 3,067 3,305 8% Increase 50 bps Margin Expansion Margin % 16.1% 16.6% Net Income 1,987…
Total Shareowner Return 1-YR 3-YR HON Percentile Rank = 64% HON Percentile Rank = 47% 89.7% 88.6% HON Annual 66.2% 8.2% 7.0% TSR 5.1% 2009 = 24% S&P Peer Median HON S&P Peer Median HON 2010 = 39% 2011 = 5% 5-YR 10-YR 2012…
Recent Organizational and Management Changes 8
2014 Management Changes Retirement of CFO, Dave Anderson; Promotion of Thomas Szlosek - Szlosek joined HON in 2004, served as HONs Controller and CFO of ACS Promotion Of Two New Divisional CEOs - Alex Ismail becomes President/CEO of…
2014 Segment Realignment Change In Organization Structure Under a realigned segment reporting structure, there are now three business segments: Aerospace, Automation and Control Solutions (ACS) and Performance Materials and…
Executive Pay 11
Executive Compensation Program - 2014 Base Pay 9% of CEO Target Annual Direct Compensation; / 17% other NEOs - 2014 Merit Increases: 5% for CEO; 0%-9% other NEOs (no merits in 2013) - 2 NEOs with promotional increases (new CFO / new…
2014-2015 Growth Plan Total Honeywell Performance Targets (3-Metrics, Equally Weighted M&A Excluded) 1. Total Sales (for 2-years): 82.74 Billion 3.9% CAGR 2. 2015 Segment Margin: 17.3% 100 bps Improvement Vs 2013 3. 2015 ROI: 22.8%…
2014 Shareowner Voting Results 14
2014 HON Annual Meeting Voting Results Election of Directors: All Directors Received at Least 91% Approval Say on Pay: 91% Approval Shareowner Proposals: None Received Majority Support - Independent Chair: 48% voted For (up 5% from…
Comparison To Voting Results In S&P 500 Say On Pay - Averaging 90% Support at S&P 500 Companies - Approval Levels Remain High, Similar to 2013 Proxy Season Independent Chair - 49 Proposals, Up From 47 Last Year; Passed At Vornado…
2015 Governance Issues 17
Honeywell Board Composition Director Tenure HON average director tenure is 7.4 years (below US market average of 8.6 yrs) Tenure 1-4 Years 5-9 Years 10 Years No. of HON 4 4 4 Directors - Composition among new, mid and long tenured…
2014 Governance Developments Issuance of New Corporate Citizenship Report Describes our commitment to safeguarding natural resources and worker and public health Honeywell brand promise closely linked to sustainability: nearly 50% of…
Appendix Reconciliation of non-GAAP Measures to GAAP Measures 20
Reconciliation Of Segment Profit To Operating Income And Calculation Of Segment Profit And Operating Income Margins (M ) 1H13 1H14 Aerospace 1,134 1,141 Automation and Control Solutions 890 1,004 Performance Materials and…
Calculation Of EPS At Tax Rate Of 26.5% (M except per share amounts) 1H13 1H14 Income Before Taxes 2,589 2,934 Taxes at 26.5% 686 778 Net Income at 26.5% Tax Rate 1,903 2,156 Less: Net Income Attributable to the Noncontrolling…
Reconciliation Of Cash Provided By Operating Activities To Free Cash Flow (M ) 1H13 1H14 Cash Provided by Operating Activities 1,597 2,029 Expenditures for Property, Plant and Equipment (344) (421) Free Cash Flow 1,253 1,608 23
Reconciliation Of Segment Profit To Operating Income And Calculation Of Segment Profit And Operating Income Margins (M ) 3Q13 4Q13 2013 Aerospace 602 636 2,372 Automation and Control Solutions 523 570 1,983 Performance Materials…
Reconciliation Of Segment Profit To Operating Income And Calculation Of Segment Profit And Operating Income Margins (B) 3Q14E 4Q14E 2014E Segment Profit 1.7 - 1.8 1.7 - 1.8 6.7 - 6.9 Stock Based Compensation (1,3) (0.0) (0.0)…
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