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BOSTON,UK - UNITED Technologies Corp, whose products range from elevators to jet engines, plans to cut 11,600 jobs as it adapts to an economy that has grown worse than it expected just three months ago.
The diversified US manufacturer also cut its 2009 profit forecast by roughly 13 per cent and lowered its revenue target as it is no longer relying on an economic recovery later this year, its chief executive said on Tuesday.
United Tech shares rose about 6.7 per cent amid a broad stock market rally as Wall Street had regarded the company's profit target set in December as optimistic.
Combined with 2008 job cuts, the latest restructuring plan will reduce the Hartford, Connecticut-based company's workforce by about 18,000 positions. As of December, United Tech employed about 220,000 people.
The world's largest maker of elevators and air conditioners said it expected to earn US$4 to US$4.50 per share in 2009, lower than the US$4.65 to US$5.15 it previously forecast.
Analysts were looking for profit of US$4.60 per share, according to Reuters Estimates.
United Tech said it expected US$750 million(S$1.15 billion) in restructuring costs this year, partly offset by US$200 million to US$350 million in gains. All told, one-time items will weigh profits down by 30 to 40 cents per share for the year.
The company, which also makes Sikorsky helicopters, now looks for revenue of US$55 billion this year, down from a prior forecast of about US$57 billion. It said it would cut its planned budget to repurchase shares by half to US$1 billion. It plans to reduce capital spending about 20 per cent from 2008 levels, to below US$1 billion.
United Tech's competitors include Eurocopter, a unit of EADS, in helicopters; General Electric Co in jet engines and ThyssenKrupp in elevators.
Its shares were up $2.52 at US$40.08 on the New York Stock Exchange on Tuesday afternoon. At Monday's close, the stock had fallen 44 per cent over the past year, in line with the 45 per cent slide of the Dow Jones industrial average. -- REUTERS
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