Honeywell 2013 Annual Report Download - page 51

2012 compared with 2011
ACS sales increased by 2 percent in 2012 compared with 2011, primarily due to a 3 percent
increase in organic revenue driven by increased sales volume and 1 percent growth from acquisitions,
net of divestitures, partially offset by the unfavorable impact of foreign exchange.
•Sales in our Energy, Safety & Security businesses increased by 2 percent (1 percent organic) in
2012 principally due to (i) the positive impact of acquisitions (most significantly EMS
Technologies, Inc. and King’s Safetywear Limited), net of divestitures, (ii) higher sales volumes
due to contract wins and new product introductions in the scanning and mobility business, (iii)
higher sales volumes due to improved U.S. residential market conditions and new product
introductions in the security business, partially offset by (i) the unfavorable impact of foreign
exchange, (ii) lower sales volume in Europe and (iii) decreases in sales volumes of our personal
protective equipment and sensing and control products primarily the result of softness in
industrial end markets.
•Sales in our Process Solutions business increased 3 percent (6 percent organic) in 2012
principally due to increased conversion to sales from backlog, partially offset by the unfavorable
impact of foreign exchange. Project orders decreased in the second half of 2012 compared to
the corresponding period in 2011 primarily driven by extension of project timing by customers
and higher than typical project orders in the fourth quarter of 2011.
•Sales in our Building Solutions & Distribution businesses increased by 3 percent (4 percent
organic) in 2012 principally due to growth in our Building Solutions business reflecting
conversion to sales from backlog and increased sales volume in our Americas Distribution
business due to improved U.S. residential market conditions, partially offset by the unfavorable
impact of foreign exchange and softness in the energy retrofit business. Project orders
decreased in the fourth quarter of 2012 principally due to extension of project timing by
customers and softness in the energy retrofit business.
ACS segment profit increased by 7 percent in 2012 compared with 2011 due to a 8 percent
increase in operational segment profit and a 1 percent increase from acquisitions, net of divestitures
partially offset by a 2 percent unfavorable impact of foreign exchange. The increase in operational
segment profit is primarily the result of the positive impact from price and productivity, net of inflation.
Cost of products and services sold totaled $10.6 billion in 2012, an increase of $212 million which is
primarily due to higher sales, inflation and acquisitions, net of divestitures partially offset by the
favorable impact of foreign exchange and productivity.
2014 Areas of Focus
ACS’s primary areas of focus for 2014 include:
•Extending technology leadership through continued investment in new product development and
introductions which deliver energy efficiency, lowest total installed cost and integrated solutions;
•Defending and extending our installed base through customer productivity, globalization,
channel optimization and service penetration;
•Sustaining strong brand recognition through our brand and channel management;
•Continuing to identify, execute and integrate acquisitions in or adjacent to the markets which we
serve;
•Continuing to establish and grow presence and capability in high growth regions;
•Continued deployment and optimization of our common ERP system;
•Continued deployment and maturation of HOS; and
•Continued proactive cost actions and successful execution of repositioning actions.
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