BrnJetFuel
NetJets Slave
- Joined
- Feb 2, 2003
- Posts
- 125
Raytheon CEO: We must fix jet unit
BLOOMBERG NEWS
LEXINGTON Raytheon Co., the maker of Beechcraft and Hawker business jets, would consider selling its aircraft business after fixing problems at the unit, Chief Executive William Swanson said.
The unit is not a "core" business of Raytheon, Swanson said at a Morgan Stanley conference in Scottsdale, Ariz. It's the first public statement Swanson made about the aircraft unit since becoming chief executive July 1.
Raytheon has been working to trim losses at the unit and return it to profit. Unit Chief Executive James Schuster cut aircraft losses to $4 million last year from $760 million in 2001. Its aircraft backlog shrank to $2.2 billion in the second quarter, from $4.7 billion a year earlier, after customers including Berkshire Hathaway Inc.'s NetJets Inc. canceled orders.
"You don't want to make a decision like that when you have to put your business in the right shape," Swanson said when asked if he'd sell the unit. "As soon as the market wakes up and people realize there is a rationalization that needs to take place, we'll be in the right position to be able to do that."
Raytheon's competitors include Textron Inc., the maker of Cessna aircraft, and the Gulfstream unit of General Dynamics Corp. Sales at Wichita, Kansas-based Raytheon Aircraft rose 19 percent to $627 million last quarter, or 14 percent of the parent company's total revenue. Profits fell 36 percent to $7 million, while deliveries rose to 87 planes from 81.
Raytheon said Tuesday that the U.S. Securities and Exchange Commission has formalized an investigation into its aircraft unit. The SEC, which began an informal probe in January, is reviewing accounting at the unit from 1997 to 2001.
Shares of Raytheon closed yesterday at $32, up 10 cents, in New York Stock exchange trading yesterday.
BLOOMBERG NEWS
LEXINGTON Raytheon Co., the maker of Beechcraft and Hawker business jets, would consider selling its aircraft business after fixing problems at the unit, Chief Executive William Swanson said.
The unit is not a "core" business of Raytheon, Swanson said at a Morgan Stanley conference in Scottsdale, Ariz. It's the first public statement Swanson made about the aircraft unit since becoming chief executive July 1.
Raytheon has been working to trim losses at the unit and return it to profit. Unit Chief Executive James Schuster cut aircraft losses to $4 million last year from $760 million in 2001. Its aircraft backlog shrank to $2.2 billion in the second quarter, from $4.7 billion a year earlier, after customers including Berkshire Hathaway Inc.'s NetJets Inc. canceled orders.
"You don't want to make a decision like that when you have to put your business in the right shape," Swanson said when asked if he'd sell the unit. "As soon as the market wakes up and people realize there is a rationalization that needs to take place, we'll be in the right position to be able to do that."
Raytheon's competitors include Textron Inc., the maker of Cessna aircraft, and the Gulfstream unit of General Dynamics Corp. Sales at Wichita, Kansas-based Raytheon Aircraft rose 19 percent to $627 million last quarter, or 14 percent of the parent company's total revenue. Profits fell 36 percent to $7 million, while deliveries rose to 87 planes from 81.
Raytheon said Tuesday that the U.S. Securities and Exchange Commission has formalized an investigation into its aircraft unit. The SEC, which began an informal probe in January, is reviewing accounting at the unit from 1997 to 2001.
Shares of Raytheon closed yesterday at $32, up 10 cents, in New York Stock exchange trading yesterday.
