Investing.com -- Reiterating its focus on maximizing productivity while striving to minimize excessive costs, United Technologies Corporation (N:UTX) announced a three-year, $1.5 billion restructuring plan on Thursday through 2018.
United Technologies, one of the largest defense contracting and high-technology manufacturers in the U.S., said in a statement that the plan will concentrate on structural cost reductions in high-cost locations, which could save it up to $900 million in annualized expenses. For 2015, United Technologies now expects to make approximately $400 million in restructuring changes, up from previous estimates of $300 million.
United Technologies did not disclose if the restructuring plan will include extensive lay-offs in its workforce.
"Our consistent focus on productivity over the years has resulted in a lean SG&A cost base relative to industry peers. This next phase of restructuring will principally focus on further structural cost reductions across the manufacturing base, particularly through footprint consolidation," CEO Gregory Hayes said in a statement.
Separately, the company announced that it has raised its full-year adjusted EPS guidance by 0.05 to a new range of $6.20 to $6.30. In 2016, United Technologies anticipates adjusted earnings per share of $6.30 to $6.60. United Technologies also expects to finish with revenues between $56 and $58 billion next year, with organic growth of 1 to 3%.
In July, United Technologies completed its spin-off of its Sikorsky helicopter division with a $9 billion sale to Lockheed Martin (N:LMT).
"I'm proud to say that over the past few weeks, we have closed the $9 billion Sikorsky sale and launched an accelerated share repurchase program to return another $6 billion to our shareholders. We are now well positioned to deliver results toward the higher end of our previously announced expected EPS range for 2015," Hayes added.
United Technologies also announced on Thursday that Brian Rogers, chairman of T. Rowe Price Group, Inc. and Fredric Reynolds, CFO of CBS Corporation (N:CBS) have been elected to its Board of Directors. The appointments will be effective on January 1.
Shares in United Technologies gained 1.69 or 1.80% to 95.57 in after-hours trading.