By Mike Stone and Pratyush Thakur
(Reuters) -U.S. aerospace and defense company RTX raised its full-year earnings forecast and beat estimates for second-quarter profit on Thursday, aided by a rebound in the broader commercial aviation sector.
RTX stock hit an all time high, trading up 8% at $113 in New York.
Airlines are flying older aircraft to meet the surge in air travel demand amid a shortage of new jets, leading to a bustling aftermarket business and benefiting companies such as RTX.
"The strength in our end-markets and first-half performance gives us the confidence to increase our outlook for adjusted sales and adjusted EPS for the full year," said CEO Chris Calio.
Meanwhile, strong demand for original equipment and aftermarket services led to a more than twofold jump in quarterly profit at Pratt and Whitney, a subsidiary of RTX, to $542 million.
GTF COMPENSATION
Pratt and Whitney — the maker of the popular Geared Turbofan (GTF) engines, which powers Airbus' A320neo jets — has been conducting an inspection drive to check for potentially flawed components in the GTF jet engines.
RTX said it has reached agreements with more than 18 GTF engine customers.
"We had 9 (agreements) that were completed at the end of the first quarter, we've more than doubled that," Chief Financial Officer Neil Mitchill told Reuters in an interview.
According to a Bernstein note published this month, around 540 GTF-powered Airbus A320neo aircraft are currently grounded due to engine issues.
RTX posted adjusted per-share net income of $1.41 in the quarter, beating analysts' average estimate of $1.30, according to LSEG data.
The company's revenue jumped 8% to $19.72 billion during the period.
It expects full-year adjusted profit per share to be between $5.35 and $5.45, compared with its prior forecast range of $5.25 to $5.40.
GE Aerospace, which makes the competing LEAP engines, also raised its full-year profit forecast earlier this week, but flagged persistent supply constraints hurting new engine output.