October 26, 2021

By Nathan Gomes and Mike Stone

(Reuters) -Raytheon Technologies Corp raised its forecast for full-year adjusted profit on Tuesday, as rising commercial air travel boosted demand for the aerospace and defense firm’s engines, spare parts and aftermarket services.

Recovering demand for air travel with the holiday season on the horizon has helped drive demand for Raytheon’s aircraft cabin interiors and engines as the U.S. government’s decision to open its borders to vaccinated individuals from abroad points to a recovery of the wide-body aerojet aftermarket, Raytheon Chief Financial Officer Neil Mitchill told Reuters in an interview.

While the company faces supply chain challenges among its 13,000 suppliers, Mitchill said “it comes down to some very acute issues” with labor shortages having some impact.

“We’re seeing some shortfalls in electronic components, connectors, things like that. We’re not as exposed like the auto industry is to the chips,” Mitchill said.

The pandemic has crippled many companies’ ability to send and receive the parts and supplies they need to produce a wide range of products, creating shortages, reducing inventories and hammering profits.

Raytheon, whose Pratt and Whitney unit supplies aircraft engines to companies like Boeing Co, said it expects 2021 adjusted profit per share to be between $4.10 to $4.20, up from its prior forecast of $3.85 to $4.00 per share.

The maker of Tomahawk missiles reported that net income rose to $1.39 billion, or 93 cents per share, in the third quarter ended Sept. 30 from $264 million, or 17 cents per share, a year earlier.

Raytheon’s quarterly revenue rose 9.9% to $16.21 billion.

(Reporting by Nathan Gomes in Bengaluruand Mike Stone in Washington, D.C.; Editing by Shailesh Kuber and Mark Porter)

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