Honeywell Building Technologies (HBT) is the smallest of 4 reportable segments with $5.5 billion revenues in 2021, which represents just 16% of Honeywell’s diversified business areas across Aerospace, Performance Materials and Technologies, and Safety and Productivity Solutions. HBT has more than 18,000 employees.
In the building automation sector, Honeywell Building Technologies is one of the top three global providers of building management systems, control products and energy management solutions and services. The business also offers a broad portfolio of fire, life safety and security systems. Their products, software and technologies are found in more than 10 million buildings worldwide. Doug Wright, former President of the global Fire & Security business took over as President and CEO, Honeywell Building Technologies in July 2021.
2021 net sales of the Building Technologies division were $5,539 million, up 7% on 2020 but down 9% on 2019. Product sales, which account for 59% of HBT 2021 revenues increased 9% (+6% organic). Building Solutions revenues, which account for 41% of HBT 2021 revenues, increased 4%, but were flat on an organic basis. HBT Segment margin increased 120 bps to 22.4%.
We highlight below some of the significant product launches, acquisitions, strategic investments, and partnerships announced in 2021.
The Connected Buildings business announced the availability of Honeywell Sine, a mobile workplace management solution to support organizations in their plans to return workers to buildings. From managing varying occupancy levels to pre-screening visitors before arrival, Sine helps facility managers and operators create frictionless access by checking credentials with a mobile device through integrations with access control systems. Honeywell acquired Adelaide, Australia-based Sine, in December 2020. Sine complements Honeywell's growing software offerings for building owners and managers.
Honeywell Forge Real Estate Operations recently launched as the first joint cloud-based solution between Honeywell and SAP to integrate building operational data and business data to improve the efficiency of real estate portfolios. The combination of optimizing real estate performance plus a mobile-driven occupant experience is further digitally transforming how facility managers and operators work.
The Fire and Connected Life Safety Systems and Services business benefited from investment in 2021 with two acquisitions followed up by a strategic investment in Jan 2022, which together augment its US public safety communications solutions, designed to improve the safety of first responders and building occupants.
In March 2021, Honeywell acquired a majority stake in Fiplex Communications, Inc., a Miami-based company that develops in-building communications systems, including bi-directional amplifiers (BDAs) that provide continuous and critical in-building radio coverage in challenging environments to improve the safety of first responders and building occupants.
In December, 2021, Honeywell acquired US Digital Designs, a Tempe, Ariz.-based company, for a purchase multiple of ~14X EBITDA in an all-cash transaction. When combined with Honeywell's Connected Life Safety Services, US Digital Designs' fire station alerting offerings will securely transmit detailed data about the emergency, such as the type of hazard, severity, and location within the impacted building, all before first responders even arrive on site, as well as eliminating manual processes.
In January 2022 Honeywell Building Technologies announced a strategic investment in RapidSOS, as well as technology integrations between the two companies that will further modernize and digitize the public safety communications process. RapidSOS is the emergency response data platform used by more than 5,200 emergency communications centers (ECCs) worldwide. The Honeywell Connected Life Safety System (CLSS) will link to the RapidSOS emergency response data platform to securely transmit detailed data about the emergency, such as the type of hazard, severity, and location within the impacted building to emergency response centers.
In the Access Control business, Honeywell and IDEMIA, a global provider of Augmented Identity, announced a strategic alliance that will integrate Honeywell’s security and building management systems with IDEMIA’s biometric-based access control systems to create more efficient buildings. The Honeywell and IDEMIA alliance is intended to design solutions that will allow occupants to easily and securely have contactless engagement with a building – from vehicle recognition at the car park and automatic elevator calls to biometric-based access and personalized conference room settings.
While organic revenues in Honeywell Building Solutions showed no increase in 2021, the business is expecting a positive outlook for organic growth in 2022 as they execute on their robust order backlog and see strong demand for building solutions.
This article was written by Daphne Tomlinson, Senior Research Associate at Memoori.