The ratings on Honeywell International Inc. reflect its substantial operating diversity, solid competitive positions, and strong overall financial profile. The ratings also acknowledge the firm's cyclical and competitive markets, and liability exposure arising from asbestos litigation, environmental issues, and unfunded postretirement obligations. Standard&Poor's Ratings Services expects a balanced use of sizable free cash flow and cash balances, including debt reduction, to help preserve credit quality. Honeywell provides aerospace products and services, automation and control technologies for buildings and industries, transportation products, and specialty materials. In the largest segment, aerospace (35%-40% of sales and highest operating margins), a material increase in new jetliner deliveries planned for 2006 and 2007 should aid original equipment sales, while continued air traffic growth
