Story1Rockwell Collins results mixed in third quarter

Rockwell Collins reported higher third quarter earnings Friday, driven primarily by stronger performance in the company's Interior Systems business and a big tax benefit from the Tax Cut & Jobs Act.

The aerospace components company reported earnings of $1.66 per share, up 48 percent from $1.12 per share in the prior year's third quarter. However the company's adjusted earnings per share increased more narrowly to $1.73 per share from $1.64 per share in the year-earlier quarter. The primary adjustments were a tax benefit of 42 cents per share from the Tax Cut & Jobs Act, and 23 cents in one-time charges related to a contract issue settlement payment and an asset writedown in an engineered components.

The earnings were below analysts' estimates, however Rockwell Collins' share price was largely unaffected by the miss because it is more influenced by the price of the upcoming stock-and-cash purchase of Rockwelll Collins by United Technologies Corp., which could take place later this summer. 

Operating earnings were up in two of Rockwell Collins' four business units. Commercial Systems operating earnings rose 3 percent to $148 million, on 2 percent higher sales. Original equipment sales were up 5 percent, while aftermarket sales continued to slip, falling 2 percent.

Interior Systems operating earnings were up 47 percent to $106 million, on 2 percent higher sales. The improvement reflected cost savings, favorable foreign currency exchange rates, higher sales, and the absence of a $44 million inventory accounting adjustment in the prior year's third quarter.

In the Information Management Systems business, operating earnings fell 5 percent to $37 million on 7 percent higher sales. Operating earnings in the Government Systems business fell 1 percent to $138 million on 13 percent higher sales. Higher company-funded R&D expenses and lower margins on thermal and electronics systems sales were blamed for the reduced earnings.

Rockwell Collins CEO and President Kelly Ortberg described the quarter's results as "solid" in an earnings release.

"In addition to the solid business performance for the quarter we have spent significant energy preparing for the upcoming merger with United Technologies Corporation," Mr. Ortberg said. "I'm confident that those efforts, along with strong market conditions, will allow us to hit the ground running at the anticipated close."

Innovas Technologies co-founders Charles Dirks (left) and Mike Crocker show off the spongy balls used in their Helios Tube Cleaning System for a 2017 CBJ profile.
Coralville-based  Innovas Technologies has renewed its sole source supplier agreement with the University of Virginia (UVA), the company announced this week.  

The agreement, which lasts through 2020, also provides the opportunity for any Virginia state institution to purchase systems from Innovas through the preferable terms of the contract.  Other Virginia state institutions that have used the sole source agreement include William & Mary and George Mason University.

"This agreement is indicative to the quality and effectiveness our products offer to our growing list of customers." said Charles Dirks, president of Innovas Technologies, in a release.

UVA has employed Innovas' Helios Tube Cleaning Systems since 2014 and currently operate over 20 Helios systems in their daily HVAC operations.   The Helios has contributed to more efficient HVAC spending for UVA, company officials said, as well as significantly reducing UVA's workload associated with comfort cooling chiller maintenance. 

Innovas Technologies, founded in 2014, is a privately held design, manufacturing and service firm focused on eliminating shell and tube heat exchanger fouling.  The company provides automatic shell and tube cleaning systems to serve the spectrum of shell and tube heat exchangers, helping to eliminate the more than $80 billion annually wasted in US shell and tube heat exchangers due to fouling.

In this week's CBJ Report, Reporter Katharine Carlon discusses a new partnership between the University of Iowa and Iowa State to bring in more research dollars, potential redevelopment of an area of downtown Cedar Rapids known as the Banjo Block and Klein Tools' decision to close its Cedar Rapids distribution facility and expand in Texas. Watch the full report here.

On the heels of what West Bank Chairman and CEO Dave Nelson calls  "the best second quarter we have ever had during our 125 year history," the West Des Moines-based bank has been named one of the top performing U.S. banks by  Bank Director Magazine.

In a letter to employees, Mr. Nelson announced the financial institution ranked 12th on the nation within its asset class of   $1-$5 billion and 21st in the nation among banks of all sizes.

"Not [number] 21 in Iowa, Minnesota or just the Midwest," Mr. Nelson wrote. "[Number] 21 in the entire United States of America, including the huge financial institutions."
The ranking comes as the bank, celebrating its 125th anniversary this year,  reported second quarter 2018 net income of $6.8 million, or $0.41 per diluted common share compared to second quarter 2017 net income of $6.4 million, or $0.39 per diluted common share. 

On July 25, the company's board of directors declared a regular quarterly dividend of 20 cents per common share payable on Aug. 22.

"We continue to see strong growth opportunities in all the markets we serve,"  Brad Winterbottom, West Bank president, said in a release. "We believe the bank is well positioned with solid growth, asset quality and capital levels, and an experienced and seasoned team."

Mr. Winterbottom cautioned, however, that "the current environment, though, is not without its challenges given the flat yield curve and a very competitive lending environment."

He added that in order to meet customer needs and improve efficiency,  West Bank would consolidate its Iowa City and Coralville branches this fall.  

After being caught on the front lines of a trade war for several months, some Iowa farmers say it seems President Trump knew he might want to deliver some good news during his visit to Dubuque on Thursday. He did, CBS2/FOX 28 reports.

 " I'm very close, I have to tell you, to pulling off something that you've been looking forward to for many years and that's the 12-month E-15 waiver."

With those words, the president touched off new round of hope, but also skepticism. He has promised his support for renewable fuels and an increased use of ethanol since his first days of campaigning for president in Iowa.  Right now anyone can purchase a 10 percent blend of ethanol in their fuel at almost any gas station or convenience store. But, E-15 is difficult to find and only available during the winter months.

Corridor farmers say the increased demand for corn by making E-15 available all year could raise the price per bushel by as much as 35-cents. Iowa Corn Growers Association President Mark Recker says he has mixed emotions: " A person has to be cautiously optimistic. The president said it today, but he's said it before."

Johnson County farmer Steve Swenka says his crop is looking pretty good despite ups and downs in the weather. He says if he sold corn today it would probably bring about $3.25 a bushel, adding it's easy math to understand the additional 35 cents with a yield of about 200-bushels per acre could add up fast.

Mr. Swenka says it's important to remember the benefits of that would extend far beyond the fence line.

"When you put money in the farmer's pocket and they go out to buy a piece of equipment, that's helping the manufacturing industry or a new vehicle or household equipment," he said. "Letting the farmers become profitable is good for Iowa, America and more than just the family farm."
July 30
Coralville Roundtable, by Iowa City Area Chamber of Commerce, noon-1 p.m., The Marriott, 300 E Ninth St., Coralville. Roundtables are social lunches over the noon hour. All are invited to network and keep up to date with chamber and community events. Free for members. Call the chamber at (319) 337-9637 if interested and not a member.

July 31
E-Commerce Breakfast, by Marion Chamber of Commerce, 8-9:30 a.m., Marion City Hall, 1225 Sixth Ave., Marion. Learn about online marketplace opportunities and ways to connect your business with others in the area. Free. For more information, visit

Social Media for Nonprofits, by Cedar Rapids Metro Economic Alliance and Kirkwood Training and Outreach Services, 8:30 a.m.-12:30 p.m., Kirkwood Iowa City Learning Center, 1810 Lower Muscatine Road, Iowa City. Discover how to use Facebook and Twitter to keep the conversation about your nonprofit going. Cost: $149. To register, visit

Ribbon Cutting: CPR Cell Phone Repair, by Iowa City Area Chamber of Commerce, 4 p.m., 2439 Second St., Coralville. Help congratulate and welcome CPR Cell Phone Repair to the Coralville business community. Free. For more information, visit

August 1
1 Million Cups, by 1MC, 9-10 a.m., Geonetric, 415 12th Ave. SE, Cedar Rapids and MERGE, 136 S. Dubuque St., Iowa City. Join for community connections, startup pitches and free coffee. Free. For more information, visit

Groundbreaking: Hotel Millwright, by Hotel Millwright, 10 a.m., 800 48th Ave., Amana. Help celebrate the groundbreaking of Amana's first boutique hotel and conference center. Free. For more information and to RSVP, contact [email protected].
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Headlines from CBS2/FOX 28
These news items are provided by CBS2/FOX 28  
One week since a devastating EF-3 tornado blew through parts of central Iowa, Marshalltown residents continue picking up the pieces and counting their blessings.  "I had a hot shower for the first time today in a week," said Marshalltown Mayor Joel Greer.   However, Mr. Greer said it is still hard to think about the struggles many people are still facing. "Other people are still sleeping in their front yard," he said.  "There really is a bit of shock that takes a little bit of time to get over with, but then that's replaced with the spirit of wanting to rebuild," said Ron Corbett. Mr. Corbett, the former Cedar Rapids mayor, said he recalls the challenges of rebuilding after the 2008 flood: "You can't recover just using your own resources. You have to use those resources and also the state and federal government," he said.  It took 10 years for Cedar Rapids to get $117 million in federal aid, but Mr. Corbett said the process could be faster in Marshalltown. "One of our biggest hang-ups was the buyout program, because we had to relocate so many people. They don't have that particular challenge," he said.  On Thursday, Mr. Greer wanted the opportunity to seek aid for his city when he was invited to greet President Trump on the tarmac during his visit to Dubuque.  He said their time speaking together was brief, and he did not have an opportunity to ask for federal disaster aid. However, the mayor is now looking to cities like Parkersburg and Cedar Rapids for advice on how to come out on top after disaster.

T hese news items are provided by CBS2/FOX 28 
CBS2 Chief Meteorologist Terry Swails' Weather First Forecast

Temperatures will be below normal and it will be nice and comfortable through the end of the month.  There will be sun to start today with clouds building in the afternoon. Temperatures will be in the mid 70s once again.  This weekend will be cool and comfortable with temperatures in the mid 70s both days. There will be more clouds Saturday as a disturbance moves through southern Iowa. Both days there will also be the chance for a few light showers or sprinkles, but shouldn't get in the way of outdoor plans.  Temperatures will remain near and below normal through the start of August. High temperatures will be in the mid 70s to low 80s through the beginning of next week.