Textron Inc <TXT.N> reported a higher-than-expected quarterly profit, benefiting from its Arctic Cat acquisition and strength in the company's Bell helicopter business.
In March, Textron completed the acquisition of Arctic Cat for $247 million in cash to accelerate its push into the recreational vehicle market. Arctic Cat makes all-terrain vehicles (ATVs), side-by-sides and snowmobiles.
Sales in the Bell business increased 2.6 percent in the second quarter, helped by higher deliveries of the H-1 helicopters to the U.S. government.
The company last month signed an agreement with China's Shaanxi Helicopter Co Ltd to deliver 100 Bell 407GXPs.
"Helicopter market continues to be stronger in China," Chief Executive Scott Donnelly said on a post-earnings call on Wednesday.
Sales in Textron's aviation business, which makes the Beechcraft and the Cessna aircraft, fell 2.1 percent due to fewer deliveries of the King Air turboprop aircraft.
Demand for corporate jets has slowed as companies, oil tycoons and billionaires curtail spending amid an uncertain global economy.
However, Textron said it was still seeing an improvement in business jet pricing.
There was some reservation around spending in the United States, Donnelly said, as customers awaited the administration's action on tax reform that would boost the economy and their business outlook.
Textron reaffirmed its adjusted earnings forecast of $2.40 to $2.60 per share for the year. Sales in the Providence, RI-based company's industrial business rose 10.9 percent to $1.11 billion in the second quarter.
The company said its net income fell 13.6 percent to $153 million, or 57 cents per share, in the quarter ended July 1.
On an adjusted basis, the company earned 60 cents from continuing operations.
Revenue rose 2.6 percent to $3.60 billion.
Analysts on average had expected the company to earn 55 cents per share, according to Thomson Reuters I/B/E/S. Textron's shares were marginally up at $49.55 in morning trading.
