Honeywell 2005 Annual Report Download - page 30

Aerospace
2005 2004 2003
(Dollars in millions)
Net sales $ 10,497 $ 9,748 $ 8,813
Segment profit $ 1,703 $ 1,479 $ 1,221
Segment profit % 16.2% 15.2% 13.9%
Aerospace is a leading global supplier of aircraft engines, avionics, and related products and services for aircraft manufacturers,
airlines, aircraft operators, military services, and defense and space contractors. Our Aerospace products and services include auxiliary
power units, propulsion engines, environmental control systems, engine controls, repair and overhaul services, flight safety,
communications, navigation, radar and surveillance systems, aircraft and airport lighting, management and technical services,
advanced systems and instruments and aircraft wheels and brakes. Aerospace sells its products to original equipment (OE)
manufacturers in the commercial air transport and business and regional aircraft segments, and provides spare parts and repair and
maintenance services for the aftermarket (principally to aircraft operators). The United States Government is also a major customer for
our defense and space products.
Economic and Other Factors—Aerospace's operating results are principally driven by the global demand for air travel as
reflected in new aircraft production, as well as the demand for spare parts and maintenance and repair services for aircraft currently in
use. Aircraft production by commercial air transport OE manufacturers, business and regional jet deliveries, as well as global flying
hours and airline profitability, are the principal factors that drive our commercial aerospace operating results. The level and mix of
U.S. Government appropriations for defense and space programs and military activity are critical factors impacting our defense and
space operating results.
Areas of Focus—Aerospace's primary areas of focus include:
• Continuing to grow the sales and profitability of the commercial aerospace aftermarket as the worldwide airline industry
struggles to regain and maintain profitable operations.
• Securing Honeywell product content on new aircraft platforms.
• Making our product development process faster and less costly to meet increasing customer requirements while continuing to
reduce manufacturing costs.
• Continuing to design equipment that enhances the safety, performance and durability of aircraft, while reducing weight and
operating costs.
• Reducing the cost of product manufacturing and maintenance.
• Improving business operations through investments in systems and processes improvements.
Automation and Control Solutions (ACS)
2005 2004 2003
(Dollars in millions)
Net sales $ 9,416 $ 8,031 $ 7,464
Segment profit $ 1,065 $ 894 $ 843
Segment profit % 11.3% 11.1% 11.3%
ACS provides innovative solutions that make homes, buildings, industrial sites and airport facilities more efficient, safe and
comfortable. Our ACS products and services include controls for heating, cooling, indoor air quality, ventilation, humidification and
home automation; advanced software applications for home/building control and optimization; sensors, switches, control systems and
instruments for measuring pressure, air flow, temperature and electrical current; security, fire and gas detection; access control; video
surveillance; and remote patient monitoring systems; installation, maintenance and upgrades of systems that keep buildings safe,
comfortable and productive; and automation and control solutions for industrial plants, including advanced software and automation
systems that integrate, control and monitor complex processes in many types of industrial settings.
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