8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): January 24, 2006

UNITED TECHNOLOGIES CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	1-812	06-0570975
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

One Financial Plaza

Hartford, Connecticut 06103

(Address of principal executive offices, including zip code)

Registrant’s telephone number, including area code

(860) 728-7000

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Section 2—Financial Information

Item 2.02. Results of Operations and Financial Condition

On January 24, 2006, United Technologies Corporation issued a press release announcing its fourth quarter 2005 results.

The press release issued January 24, 2006 is furnished herewith as Exhibit No. 99.1 to this Report, and shall not be deemed filed for the purposes of Section 18 of the Exchange Act.

Section 9—Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits

(c) Exhibits.

The following exhibit is included herewith:

Exhibit Number	Exhibit Description
99.1	Press release, dated January 24, 2006, issued by United Technologies Corporation.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: January 24, 2006	UNITED TECHNOLOGIES CORPORATION (Registrant)
	By:	/s/ Gregory J. Hayes
		Gregory J. Hayes Vice President, Accounting and Control

EXHIBIT INDEX

Exhibit Number	Exhibit Description	Page
99.1	Press release, dated January 24, 2006, issued by United Technologies Corporation	1

EX-99.1

Exhibit 99.1

UTC REPORTS FOURTH QUARTER EPS UP 16 PERCENT TO $0.71 AND FULL

YEAR EPS UP 18 PERCENT TO $3.12 BEFORE ADOPTING FIN 47; 2005 CASH

FLOW FROM OPERATIONS REACHES $4.3 BILLION; 2006 OUTLOOK AFFIRMED

HARTFORD, Conn., January 24, 2006 – United Technologies Corp. (NYSE:UTX) today reported fourth quarter 2005 earnings per share of $0.71 and net income of $721 million, up 16 percent and 18 percent, respectively. References in this release to net income and earnings per share are before the cumulative effect of a change in accounting related to the adoption of FASB Interpretation No. 47 (Accounting for Conditional Asset Retirement Obligations) which resulted in a non-cash after tax cumulative impact of $95 million or $0.09 per share and was recorded in fourth quarter results. Consolidated revenues for the quarter increased 14 percent to $11.3 billion, reflecting organic growth of 9 percent and the addition of recent acquisitions, principally Kidde and Rocketdyne.

In the quarter, foreign currency translation reduced earnings by $0.02 per share and revenues by 1 percent.

Full year earnings per share of $3.12 and net income of $3.16 billion were both 18 percent higher than 2004 results. Revenues increased 14 percent to $42.7 billion, including 7 points of organic growth and the benefit of acquisitions.

Cash flow from operations after capital expenditures exceeded net income for both the quarter and the full year. In the fourth quarter, cash flow from operations was $1.15 billion and capital expenditures were $345 million. For the full year, cash flow from operations was $4.33 billion and capital expenditures were $929 million. Voluntary contributions to pension plans were $298 million in the fourth quarter and $663 million for the year.

“We had an exceptional year in 2005 and see more of the same in 2006,” said UTC Chairman and Chief Executive Officer George David.

“Organic growth for the year was a solid 7 percent, and we ended the year on an up quarter at 9 percent. Following 2004’s 8 percent, these rates reflect favorable conditions in most of our markets and UTC’s currently strong product line-up. All UTC segments delivered double digit operating profit increases for the year. Cash flow after capital expenditures exceeded net income in both the quarter and year, our usual standard.”

“We’re starting 2006 with lots of momentum,” David added. “We confirm expectations for earnings per share in the range of $3.40 to $3.55 and for cash flow after capital expenditures equal to net income for the year. We also expect to continue the current share repurchase rate into 2006 taking the total to approximately $1.5 billion for the year.”

Share repurchase in the quarter was $421 million and brought the year’s total to $1.18 billion. Acquisition spending, including debt assumed, was $4.6 billion for the year with approximately $500 million in the fourth quarter. Debt to capital ended the year at 33 percent.

Fourth quarter results include restructuring costs of $97 million. For the year, restructuring costs totaled $267 million and slightly exceeded the impact of favorable items. Additional favorable items are anticipated in 2006 to offset trailing costs from previous restructuring actions as well as to fund potential new actions initiated throughout the year.

The accompanying tables include information integral to assessing the company’s financial position, operating performance, and cash flow.

United Technologies Corp., based in Hartford, Connecticut, is a diversified company that provides a broad range of high technology products and support services to the building systems and aerospace industries.

This release is supplemented by presentation materials that are available on UTC’s website at www.utc.com, and includes “forward looking statements” concerning

expected revenue, earnings, cash flow and other matters that are subject to risks and uncertainties. Important factors that could cause actual results to differ materially from those anticipated or implied in forward looking statements include the health of the global economy; strength of end market demand in building construction and in both the commercial and defense segments of the aerospace industry; fluctuation in commodity prices, interest rates, foreign currency exchange rates, and the impact of weather conditions; and company specific items including the availability and impact of acquisitions, the rate and ability to effectively integrate these acquired businesses, the ability to achieve cost reductions at planned levels, and the outcome of legal proceedings. For information identifying other important economic, political, regulatory, legal, technological, competitive and other uncertainties, see UTC’s SEC filings as submitted from time to time, including but not limited to, the information in the “Business” section of UTC’s Annual Report on Form 10-K, the information included in UTC’s 10-K and 10-Q Reports under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, and the information included in Current Reports on Form 8-K.

# # #

United Technologies Corporation

Condensed Consolidated Statement of Operations

	Quarter Ended December 31,					Year Ended December 31,
	(Unaudited)					(Unaudited)
(Millions, except per share amounts)	2005			2004		2005			2004
Revenues	$	11,261		$	9,838	$	42,725		$	37,445
Cost and Expenses
Cost of goods and services sold		8,239			7,189		30,935			27,242
Research and development		423			342		1,367			1,267
Selling, general and administrative		1,378			1,273		5,241			4,635
Operating Profit		1,221			1,034		5,182			4,301
Interest expense		143			96		498			363
Income before income taxes and minority interests		1,078			938		4,684			3,938
Income taxes		294			266		1,253			1,031
Minority interests		63			60		267			234
Income before cumulative effect of a change in accounting principle		721			612		3,164			2,673
Cumulative effect of change in accounting principle-net of tax		(95	)		—		(95	)		—
Net Income	$	626		$	612	$	3,069		$	2,673
Net Earnings Per Share of Common Stock
Basic:
Income before cumulative effect of a change in accounting principle	$	0.73		$	0.62	$	3.19		$	2.69
Cumulative effect of change in accounting principle-net of tax	$	(0.09	)	$	—	$	(0.09	)	$	—
Net Income	$	0.64		$	0.62	$	3.10		$	2.69
Diluted:
Income before cumulative effect of a change in accounting principle	$	0.71		$	0.61	$	3.12		$	2.64
Cumulative effect of change in accounting principle- net of tax	$	(0.09	)	$	—	$	(0.09	)	$	—
Net Income	$	0.62		$	0.61	$	3.03		$	2.64
Average Shares
Basic		987			990		991			993
Diluted		1,010			1,008		1,014			1,011

As described on the following pages, consolidated results for the years and quarters ended December 31, 2005 and 2004 include restructuring and related charges and non-recurring items.

See accompanying Notes to Condensed Consolidated Financial Statements.

United Technologies Corporation

Segment Revenues and Operating Profit

	Quarter Ended December 31,						Year Ended December 31,
	(Unaudited)						(Unaudited)
(Millions)	2005			2004			2005			2004
Revenues
Otis	$	2,476		$	2,414		$	9,575		$	8,937
Carrier		3,043			2,697			12,512			10,620
UTC Fire & Security		1,203			773			4,250			2,879
Pratt & Whitney		2,595			2,162			9,295			8,281
Hamilton Sundstrand		1,151			1,080			4,382			3,921
Sikorsky		854			644			2,802			2,506
Segment Revenues		11,322			9,770			42,816			37,144
Eliminations and other		(61	)		68			(91	)		301
Consolidated Revenues	$	11,261		$	9,838		$	42,725		$	37,445
Operating Profit
Otis	$	426		$	384		$	1,712		$	1,413
Carrier		192			113			1,104			830
UTC Fire & Security		87			34			235			130
Pratt & Whitney		362			280			1,449			1,083
Hamilton Sundstrand		174			152			675			583
Sikorsky		70			50			250			200
Segment Operating Profit		1,311			1,013			5,425			4,239
Eliminations and other		(6	)		103			81			368
General corporate expenses		(84	)		(82	)		(324	)		(306	)
Consolidated Operating Profit	$	1,221		$	1,034		$	5,182		$	4,301

As described on the following pages, consolidated results for the years and quarters ended December 31, 2005 and 2004 include restructuring and related charges and non-recurring items.

United Technologies Corporation

Consolidated Operating Profit

Consolidated operating profit for the years and quarters ended December 31, 2005 and 2004 includes restructuring and related charges as follows:

	Quarter Ended December 31,				Year Ended December 31,
	(Unaudited)				(Unaudited)
	2005		2004		2005		2004
Restructuring and Related Charges
Otis	$	22	$	27	$	52	$	144
Carrier		18		39		80		241
UTC Fire & Security		10		—		21		—
Pratt & Whitney		23		55		39		152
Hamilton Sundstrand		24		36		66		71
Sikorsky		—		1		3		9
Segment Operating Profit		97		158		261		617
Eliminations and other		—		1		6		15
General corporate expenses		—		—		—		—
Consolidated Operating Profit	$	97	$	159	$	267	$	632

Consolidated results for the years and quarters ended December 31, 2005 and 2004 include the following non-recurring items:

2005

    Q2

• Eliminations and Other: Approximately $75 million non-cash gain on shares held in Snecma, a French aerospace company, upon its merger with SAGEM. Approximately $45 million interest income related to 1994-1999 U.S. federal tax audits.

• Income Taxes: Net favorable income tax adjustment of approximately $60 million, principally related to 1994-1999 U.S. federal tax audits. The tax impact of Hamilton Sundstrand’s divestiture of its Falk business was substantially offset by the tax benefit arising from the sale of a non-core Carrier refrigeration business. Neither transaction significantly impacted pre-tax earnings.

In the second quarter, the net impact of the above favorable items ($0.14 per share), together with $70 million of pre-tax restructuring and related charges ($0.05 per share), contributed $0.09 to earnings per share.

    Q1

• Eliminations and Other: Approximately $30 million gain from the sale of a portion of the shares held in Snecma.

2004

    Q4

• Eliminations and Other: Approximately $100 million of income relating to the disposition of an interest in a joint venture and interest income related to 1986—1993 U.S. federal tax audits.

    Q2

• Eliminations and Other: Approximately $125 million interest income related to settlement of 1986-1993 U.S. federal tax audits.

• Income Taxes: Favorable income tax adjustment of approximately $80 million, related to settlement of 1986-1993 U.S. federal tax audits.

In the second quarter, the net impact of the above favorable items, together with $156 million of pre-tax restructuring and related charges, contributed $0.07 to earnings per share.

    Q1

• Eliminations and Other: $250 million gain following a payment from DaimlerChrysler in consideration for the Corporation’s release of certain commitments made by DaimlerChrysler in support of MTU Aero Engines GmbH.

United Technologies Corporation

Condensed Consolidated Balance Sheet

(Millions)	December 31, 2005			December 31, 2004
	(Unaudited)			(Unaudited)
Assets
Cash and cash equivalents	$	2,247		$	2,265
Accounts receivable, net		7,240			6,315
Inventories and contracts in progress, net		5,659			5,078
Other current assets		2,060			2,012
Total Current Assets		17,206			15,670
Fixed assets, net		5,623			5,231
Goodwill, net		13,007			10,111
Intangible assets, net		3,059			2,016
Other assets		7,030			7,413
Total Assets	$	45,925		$	40,441
Liabilities and Shareowners’ Equity
Short-term debt	$	2,305		$	1,360
Accounts payable		3,820			3,490
Accrued liabilities		9,220			8,245
Total Current Liabilities		15,345			13,095
Long-term debt		5,935			4,231
Other liabilities		6,876			7,939
Total Liabilities		28,156			25,265
Minority interest in subsidiary companies		778			910
Shareowners’ Equity:
Common Stock		8,552			7,850
Treasury Stock		(7,418	)		(6,312	)
Retained Earnings		16,051			13,880
Accumulated other non-shareowners’ changes in equity		(194	)		(1,152	)
		16,991			14,266
Total Liabilities and Shareowners’ Equity	$	45,925		$	40,441
Debt Ratios:
Debt to total capitalization		33	%		28	%
Net debt to net capitalization		26	%		19	%

United Technologies Corporation

Condensed Statement of Cash Flows

	Quarter Ended December 31,						Year Ended December 31,
	(Unaudited)						(Unaudited)
	2005			2004			2005			2004
Operating Activities
Net Income	$	626		$	612		$	3,069		$	2,673
Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation and amortization		256			234			984			978
Deferred income taxes and minority interest		112			83			529			430
Stock compensation cost		34			46			153			169
Changes in working capital		101			190			(437	)		(87	)
Voluntary contributions to pension plans		(298	)		(347	)		(663	)		(906	)
Other, net		314			3			699			339
Net Cash Provided by Operating Activities		1,145			821			4,334			3,596
Investing Activities
Capital expenditures		(345	)		(344	)		(929	)		(795	)
Acquisitions and disposal of businesses, net		(493	)		(714	)		(3,755	)		(1,048	)
Other, net		7			86			35			81
Net Cash Used in Investing Activities		(831	)		(972	)		(4,649	)		(1,762	)
Financing Activities
Increase in borrowings, net		442			301			2,106			42
Dividends paid on Common Stock		(207	)		(164	)		(832	)		(660	)
Repurchase of Common Stock		(421	)		(304	)		(1,181	)		(992	)
Other, net		28			142			242			311
Net Cash (Used) Provided in Financing Activities		(158	)		(25	)		335			(1,299	)
Effect of foreign exchange rates		(11	)		101			(38	)		107
Net increase (decrease) in cash and cash equivalents		145			(75	)		(18	)		642
Cash and cash equivalents - beginning of period		2,102			2,340			2,265			1,623
Cash and cash equivalents - end of period	$	2,247		$	2,265		$	2,247		$	2,265

United Technologies Corporation

Notes to Condensed Consolidated Financial Statements

(1) UTC adopted Statement of Financial Accounting Standards (SFAS) No. 123 (revised 2004), “Share-Based Payment”, (SFAS 123(R)) as of January 1, 2005 using the modified retrospective method described in the standard. This standard requires the cost of stock options to be measured at fair value and recognized in the statement of operations on the grant date. In accordance with the standard all periods prior to January 1, 2005 were restated to reflect the impact of the standard as if it had been adopted on January 1, 1995, the original effective date of SFAS No. 123.

(2) Financial Accounting Standards Board (FASB) Interpretation No. 47, “Accounting for Conditional Asset Retirement Obligations” (an interpretation of FASB Statement No. 143) was issued in March 2005. This Interpretation provides clarification with respect to the timing of liability recognition for legal obligations associated with the retirement of tangible long-lived assets when the timing and/or method of settlement of the obligation is conditional on a future event. This Interpretation requires that the fair value of a liability for a conditional asset retirement obligation be recognized in the period in which it occurred if a reasonable estimate of fair value can be made. UTC has determined that legal obligations exist for certain of its worldwide owned and leased facilities related primarily to building materials. We adopted the provision of this Interpretation on December 31, 2005 and recorded a non-cash transition impact of $95 million, net of taxes, which is reported as a Cumulative Effect of a Change in Accounting Principle, Net of Tax in the Statement of Operations.

(3) Certain reclassifications have been made to prior year amounts to conform to current year presentation.

(4) Debt to total capitalization equals total debt divided by total debt plus equity. Net debt to net capitalization equals total debt less cash and cash equivalents divided by total debt plus equity less cash and cash equivalents.

(5) Organic growth represents the total reported revenue increase within the Corporation’s ongoing businesses less the impact of foreign currency translation, acquisitions and divestitures completed in the preceding twelve months and significant non-recurring items. Non-recurring revenues that are not included in organic growth in 2005 include approximately $45 million of interest income related to 1994-1999 U.S. federal tax audits and approximately $105 million of investment gains on shares held in Snecma, a French aerospace company. Non-recurring revenues that are excluded from organic growth in 2004 include approximately $170 million of interest income associated with settlement of tax audits, an approximately $60 million non-cash gain associated with the disposition of an interest in a joint venture and the first quarter contract related gain of $250 million.