Textron eyes replacements for commercial paper amid drop in Q3 profits

By Andrea Heisinger

New York, Oct. 16 - Textron Inc. announced its third-quarter earnings in a conference call Thursday, along with plans for replacing commercial paper if necessary.

The company's earnings were down sharply for the quarter, causing changes to its financial outlook, along with adjustments, for the coming quarter and year.

The company is exploring its options to replace commercial paper, according to the conference call. Specifics on the options the company is looking at were not given.

Given the possibility of continued volatility in the commercial paper markets, the company is taking measures including having sufficient capacity to cover all term maturities for the next 12 months, the company said in a news release.

The company added it has $3 billion in reserves that can be used for this purpose.

Market volatility and spreads were also discussed. At the start of the third quarter, spreads were already compressed and have continued to narrow until they're virtually non-existent, according to the call.

Although the coming quarter and year are hard to predict, Textron expects to break even for 2009, assuming spreads even out.

The aircraft, industrial and finance company is based in Providence, R.I.

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