SEC Filing

View:


                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES
                              FORM 10-Q

                  SECURITIES AND EXCHANGE COMMISSION

                           WASHINGTON D.C.
                                20549

       [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                 THE SECURITIES EXCHANGE ACT OF 1934


             For the quarterly period ended June 30, 1995



                                  OR



      [  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                 THE SECURITIES EXCHANGE ACT OF 1934

For the transition period
from____________________________to__________________________


Commission file number 1-812





                   UNITED TECHNOLOGIES CORPORATION


             DELAWARE                         06-0570975

      United Technologies Building, Hartford, Connecticut  06101

                            (203) 728-7000





Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months, and (2) has been subject to such filing requirements
for the past 90 days.  Yes    X     .   No          .

At June 30, 1995 there were 123,235,307 shares of Common Stock outstanding.

                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES

              CONTENTS OF QUARTERLY REPORT ON FORM 10-Q

                     Quarter Ended June 30, 1995



                                                               Page

Part I - Financial Information

  Item 1. Financial Statements:

     Condensed Consolidated Statement of
       Operations for the three months ended June                
       30, 1995 and 1994                                         1
     Condensed Consolidated Statement of
       Operations for the six months ended June                  
       30, 1995 and 1994                                         2
     Condensed Consolidated Balance Sheet at June
       30, 1995 and December 31, 1994                            3
     Condensed Consolidated Statement of Cash
       Flows for the six months ended June 30,                   
       1995 and 1994                                             4
     Notes to Condensed Consolidated Financial                   
       Statements                                                5
     Report of Independent Accountants                           8

  Item 2. Management's Discussion and Analysis of
     Results of Operations and Financial Position                9

Part II - Other Information

  Item 1. Legal Proceedings                                     15

  Item 4. Submission of Matters to a Vote of                    
     Security Holders                                           15

  Item 6. Exhibits and Reports on Form 8-K                      16

Signatures                                                      17

Exhibit Index
  1
                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES

            CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
                             (Unaudited)

                                                              Three Months Ended
                                                                   June 30,
In Millions of Dollars (except per share amounts)             1995           1994
                                                                
Revenues:
   Product sales                                       $      4,613   $      4,278
   Service sales                                              1,161          1,028
   Financing revenues and other income, net                      66            181
                                                              5,840          5,487
Costs and expenses:
   Cost of products sold                                      3,806          3,571
   Cost of services sold                                        680            631
   Research and development                                     233            261
   Selling, general and administrative                          672            648
   Interest                                                      67             73
                                                              5,458          5,184
Income before income taxes and minority interests               382            303
   Income taxes                                                 132            112
   Minority interests                                            32             26
Net Income                                             $        218   $        165
   Preferred Stock Dividend Requirement                           7              5
Earnings Applicable to Common Stock                    $        211   $        160

Earnings per share of common stock and common stock
   equivalents                                         $       1.65   $       1.23
Dividends per share of common stock                    $        .50   $        .45

Average common and equivalent shares outstanding (in
   thousands)                                               130,964        133,190



See Accompanying Notes
  2
                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES


            CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
                             (Unaudited)

                                                               Six Months Ended
                                                                   June 30,
In Millions of Dollars (except per share amounts)             1995           1994
                                                                
Revenues:
   Product sales                                       $      8,865   $      8,060
   Service sales                                              2,227          1,991
   Financing revenues and other income, net                      92            221
                                                             11,184         10,272
Costs and expenses:
   Cost of products sold                                      7,334          6,697
   Cost of services sold                                      1,335          1,240
   Research and development                                     451            501
   Selling, general and administrative                        1,301          1,251
   Interest                                                     129            139
                                                             10,550          9,828
Income before income taxes and minority interests               634            444
   Income taxes                                                 220            163
   Minority interests                                            61             49
Net Income                                             $        353   $        232
   Preferred Stock Dividend Requirement                          13             10
Earnings Applicable to Common Stock                    $        340   $        222

Earnings per share of common stock and common stock
   equivalents                                         $       2.68   $       1.73
Dividends per share of common stock                    $       1.00   $        .90

Average common and equivalent shares outstanding (in
   thousands)                                               130,376        132,986



See Accompanying Notes
  3
                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES

                 CONDENSED CONSOLIDATED BALANCE SHEET
                             (Unaudited)

                                                                
                                                           June 30,     December 31,
In Millions of Dollars                                       1995           1994

                                Assets

                                                                
Cash and cash equivalents                              $        755   $        386
Accounts receivable, net                                      3,566          3,745
Inventories and contracts in progress, net                    3,148          2,955
Future income tax benefits                                      932            929
Other current assets                                            199            213
   Total Current Assets                                       8,600          8,228

Fixed assets                                                 10,398         10,193
   Less - accumulated depreciation                           (5,944)        (5,661)
                                                              4,454          4,532
Other assets                                                  2,772          2,864

   Total Assets                                        $     15,826   $     15,624
   
                 Liabilities and Shareowners' Equity

                                                                
Short-term borrowings                                  $        314   $        402
Accounts payable                                              1,858          1,924
Accrued liabilities                                           4,096          4,071
Long-term debt currently due                                    172            156
   Total Current Liabilities                                  6,440          6,553

Long-term debt                                                1,753          1,885
Future pension and postretirement benefit obligations         1,429          1,389
Other long-term liabilities                                   1,905          1,706

Series A ESOP Convertible Preferred Stock                       899            905
ESOP deferred compensation                                     (528)          (566)
                                                                371            339
Shareowners' Equity:
   Common Stock                                               2,212          2,148
   Treasury Stock                                            (1,037)          (947)
   Retained earnings                                          3,004          2,790
   Currency translation and pension liability
     adjustments                                               (251)          (239)
                                                              3,928          3,752

  Total Liabilities and Shareowners' Equity            $     15,826   $     15,624



See Accompanying Notes
  4
                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES

            CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                             (Unaudited)

                                                               Six Months Ended
                                                                   June 30,
In Millions of Dollars                                        1995           1994
                                                                
Cash flows from operating activities:
   Net income                                          $        353   $        232
   Adjustments to reconcile net income to net cash
    flows from operating activities:
    Depreciation and amortization                               421            415
    Change in:
     Accounts receivable                                        161           (406)
     Inventories and contracts in progress                     (212)           (86)
     Accounts payable and accrued liabilities                   (18)          (376)
     Future income taxes payable and future income
       tax benefits                                              (6)           102
     ESOP deferred compensation                                  25             93
   Other, net                                                   121            143
     Net Cash Flows from Operating Activities                   845            117
Cash flows from investing activities:
   Capital expenditures                                        (331)          (290)
   Acquisitions of business units                               (17)           (83)
   Dispositions of business units                                88            227
   Decrease in customer financing assets, net                   170            105
   Other, net                                                    47             10
     Net Cash Flows from Investing Activities                   (43)           (31)
Cash flows from financing activities:
   Issuance of long-term debt                                     -             29
   Repayments of long-term debt                                (145)          (113)
   Increase (decrease) in short-term borrowings, net            (87)           300
   Dividends paid on Common Stock                              (123)          (113)
   Common Stock repurchase                                      (90)           (52)
   Other, net                                                    (1)            31
     Net Cash Flows from Financing Activities                  (446)            82
Effect of foreign exchange rate changes on cash and
  cash equivalents                                               13            (22)

     Net Increase in Cash and Cash Equivalents                  369            146
Cash and Cash Equivalents, Beginning of year                    386            421
Cash and Cash Equivalents, End of period               $        755   $        567



See Accompanying Notes
  5
                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES


         NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                             (Unaudited)

  The condensed consolidated financial statements at June 30, 1995 and for the
three-month and six-month periods ended June 30, 1995 and 1994 are unaudited,
but in the opinion of the Corporation include all adjustments, consisting only
of normal recurring adjustments, necessary for a fair presentation of the
results for the interim periods.  Certain 1994 amounts have been reclassified to
conform with the presentation at June 30, 1995.

Accounting and Reporting Changes

  In the fourth quarter of 1994 the Corporation adopted, effective January 1,
1994, AICPA Statement of Position (SOP) 93-6, "Employers' Accounting for
Employee Stock Ownership Plans."  The principal impact of the accounting change
on ongoing results is to consider as outstanding only those ESOP Convertible
Preferred shares committed to employee accounts, to report as interest expense
all interest on the debt of the ESOP trust and to report preferred stock
dividends only on those shares considered as outstanding.

  As this accounting change was adopted in the fourth quarter of 1994,
previously reported 1994 quarterly information has been restated to reflect the
change effective January 1, 1994.

  As a result of this change, the Corporation's pretax income was reduced by
$12 million for the three month period and $75 million, including a one-time
charge of $51 million ($31 million after tax or $.23 per share) for the six
month period.  This one-time charge represents the cumulative difference between
the expense determined under the new accounting method and that previously
recognized from inception of the ESOP through January 1, 1994.  The one-time
charge has been recorded in Financing revenues and other income, net in the
Consolidated Statement of Operations.

  The 1994 ESOP accounting change, excluding the one-time charge, reduced
pretax income by $12 million and $24 million, reduced net income by $7 million
and $15 million , and reduced reported preferred stock dividends by $6 million
and $12 million for the three-month and six-month periods ended June 30, 1994,
respectively.  These reductions in net income and preferred stock dividend
requirements, and the reduction in ESOP shares considered outstanding of 8.7
million and 8.9 million shares, have the combined effect of increasing earnings
per share by $.05 and $.07, excluding the one-time charge, for the three-month
and six-month periods ended June 30, 1994, respectively.  Overall, earnings per
share for the three-month period ended June 30, 1994 were increased by $.05 and
for the six-month period ended June 30, 1994 were reduced by $.16 as a result of
this accounting change.

Borrowings and Lines of Credit

  In June, the Corporation executed an in-substance defeasance of $100 million
of its 9-5/8% notes due May 15, 1999, callable on or after May 15, 1996.  The
Corporation deposited U.S. Government securities into an irrevocable trust to
cover the interest and principal payments on this debt and as part of this
transaction, the Corporation also gave irrevocable notice to the indenture
trustee for these notes of its election to exercise its rights to redeem the
notes on May 15, 1996.  For financial reporting purposes, the debt has been
considered extinguished and the loss on this transaction, which was immaterial,
is included in Financing revenues and other income, net.
  6
                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES

  During the second quarter, the Corporation canceled $300 million of
outstanding interest rate hedges.  As a result of debt reduction and these
contract cancellations, the percentage of total debt at floating interest rates,
after taking effect of the remaining outstanding interest rate contracts, is 32%
at June 30, 1995, versus 42% at December 31, 1994.

Contingent Liabilities

  While there has been no significant change in the Corporation's material
contingencies during 1995, the matters previously described in Note 14 of Notes
to Financial Statements in the Corporation's Annual Report on Form 10K for
calendar year 1994 are summarized below.

Environmental

  The Corporation's operations are subject to environmental regulation by
federal, state, and local authorities in the United States and regulatory
authorities with jurisdiction over its foreign operations.

  It is the Corporation's policy to accrue environmental investigatory and
remediation costs when it is probable that a liability has been incurred by the
Corporation for known sites and the amount of loss can be reasonably estimated.
Where no amount within a range of estimates is more likely, the minimum is
accrued.  Otherwise, the most likely cost to be incurred is accrued.  The
measurement of the liability is based on an evaluation of currently available
facts with respect to each individual site and takes into account factors such
as existing technology, presently enacted laws and regulations, and prior
experience in remediation of contaminated sites.

  Where the Corporation is not the only party responsible for the remediation
of a site, the Corporation considers its likely proportionate share of the
anticipated remediation expense in establishing a provision for those costs.
Included within the sites known to the Corporation are those sites at which the
Corporation has been identified as a potentially responsible party under the
Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA"
or Superfund).  Under the provisions of this statute, the Corporation may be
held liable for all costs of environmental remediation without regard to the
legality of the Corporation's actions resulting in the contamination.  In
estimating its liability for remediation, the Corporation considers its likely
proportionate share of the anticipated remediation expense and the ability of
the other potentially responsible parties to fulfill their obligations.

  Some of the Corporation's liabilities, including certain Superfund
liabilities, relate to facilities that were acquired by the Corporation with
indemnities from the sellers or former owners.  In estimating the potential
liability at these sites, the Corporation has considered the indemnification
separately from the liability.

  The Corporation has instituted legal proceedings against its insurers seeking
insurance coverage for liability to third parties for remediation costs, defense
costs, physical loss or damage to the Corporation's property, and related costs.
Settlements to date, which have not been material, have been recorded upon
receipt.  It is expected that one or more of these cases will last several
years.  Environmental liabilities are not reduced by potential insurance
reimbursements.
  7
                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES

U.S. Government

  The Corporation is now and believes that, in light of the current government
contracting environment, it will be the subject of one or more government
investigations.  If the Corporation or one of its business units were charged
with wrongdoing as a result of any of these investigations, the Corporation or
one of its business units could be suspended from bidding on or receiving awards
of new government contracts pending the completion of legal proceedings.  If
convicted or found liable, the Corporation could be fined and debarred from new
government contracting for a period generally not to exceed three years.  Any
contracts found to be tainted by fraud could be voided by the Government.

  The Corporation's contracts with the U.S. Government are also subject to
audits.  Like many defense contractors, the Corporation has received audit
reports which recommend that certain contract prices should be reduced to comply
with various government regulations.  Some of these audit reports involve
substantial amounts.  The Corporation has made voluntary refunds in those cases
it believes appropriate.

Other

  The Corporation extends performance and operating cost guarantees, which are
beyond its normal warranty and service policies, for extended periods on some of
its products, particularly commercial aircraft engines.  Liability under such
guarantees is contingent upon future product performance and durability.  The
Corporation has accrued its estimated liability that may result under these
guarantees.

  The Corporation also has other commitments and contingent liabilities related
to legal proceedings and matters arising out of the normal course of business.

  The Corporation has accrued its liability for environmental investigation and
remediation, performance guarantees, and other litigation and claims based on
management's estimate of the probable outcome of these matters.  While it is
possible that the outcome of these matters may differ from the recorded
liability, management believes that resolution of these matters will not have a
material adverse effect upon either results of operations, cash flows, or
financial position of the Corporation.
  8
                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES

  With respect to the unaudited condensed consolidated financial information of
United Technologies Corporation for the three and six-month periods ended June
30, 1995 and 1994, Price Waterhouse LLP ("Price Waterhouse") reported that they
have applied limited procedures in accordance with professional standards for a
review of such information.  However, their separate report dated July 26, 1995
appearing below, states that they did not audit and they do not express an
opinion on that unaudited condensed consolidated financial information.  Price
Waterhouse has not carried out any significant or additional audit tests beyond
those which would have been necessary if their report had not been included.
Accordingly, the degree of reliance on their report on such information should
be restricted in light of the limited nature of the review procedures applied.
Price Waterhouse is not subject to the liability provisions of section 11 of the
Securities Act of 1933 for their report on the unaudited condensed consolidated
financial information because that report is not a "report" or a "part" of the
registration statement prepared or certified by Price Waterhouse within the
meaning of sections 7 and 11 of the Act.

                  REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors of
  United Technologies Corporation

  We have reviewed the accompanying condensed consolidated statement of
operations of United Technologies Corporation and consolidated subsidiaries for
the three and six month periods ended June 30, 1995 and 1994, the condensed
consolidated statement of cash flows for the six months ended June 30, 1995 and
1994, and the condensed consolidated balance sheet as of June 30, 1995.  This
financial information is the responsibility of the company's management.

  We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants.  A review of interim
financial information consists principally of applying analytical procedures to
financial data and making inquiries of persons responsible for financial and
accounting matters.  It is substantially less in scope than an audit conducted
in accordance with generally accepted auditing standards, the objective of which
is the expression of an opinion regarding the financial statements taken as a
whole.  Accordingly, we do not express such an opinion.

  Based on our review, we are not aware of any material modifications that
should be made to the accompanying financial information for it to be in
conformity with generally accepted accounting principles.

  We previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet as of December 31, 1994, and the
related consolidated statements of operations, of cash flows and of changes in
shareowners' equity for the year then ended (not presented herein), and in our
report dated January 26, 1995, we expressed an unqualified opinion on those
consolidated financial statements.  In our opinion, the information set forth in
the accompanying condensed consolidated balance sheet as of December 31, 1994,
when read in conjunction with the consolidated financial statements from which
it has been derived, is fairly stated in all material respects in relation
thereto.

                                                  PRICE WATERHOUSE LLP

Hartford, Connecticut
July 26, 1995
  9
                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES

               MANAGEMENT'S DISCUSSION AND ANALYSIS OF
             RESULTS OF OPERATIONS AND FINANCIAL POSITION


                         BUSINESS ENVIRONMENT

  The Corporation's Otis, Carrier and UT Automotive subsidiaries serve
customers in the commercial property, residential housing and automotive
businesses.  Additionally, the Corporation's Pratt & Whitney, Sikorsky and
Hamilton Standard businesses serve commercial and government customers in the
aerospace industry.  As world-wide businesses, these operations are affected by
global as well as regional economic factors.

  U.S. residential housing starts in the first six-months decreased
approximately 9% over the same period in 1994, while commercial construction
starts remain weak.  U.S. commercial vacancy rates have improved only marginally
from the 1992 peak.

  North American car and light truck production and European car sales in the
first six-months of 1995 were essentially flat versus the comparable period in
1994.

  Worldwide airline profits in 1994 were nominal despite load factors at
historically high levels.  Reported airline results in the first half of 1995
have shown improvement through higher revenues and relatively flat costs.
However, competitive pricing strategies and disparate cost structures continue
to make it difficult for the U.S. airlines to achieve the financial condition
necessary to make significant investments in new aircraft.  For many
international airlines, increasing competition, high cost structures and
privatization initiatives will strain financial results and resources in the
near term.  While airlines have historically begun ordering new equipment
approximately 18 months after returning to profitability, management believes
the current recovery may be slower.

  The U.S. Defense industry continues to experience significant downsizing, and
further consolidation within the industry is expected.  As a result, the
Corporation has continued to reduce its reliance on U.S. Defense contracts.

                        RESULTS OF OPERATIONS

  Consolidated revenues and margin percentages were  as follows:


                           Three Months Ended        Six Months Ended
                                June 30,                 June 30,
In Millions of Dollars      1995        1994         1995        1994
                                                 
Product sales          $    4,613   $   4,278   $    8,865   $   8,060
Service sales               1,161       1,028        2,227       1,991
Financing revenues and
 other income, net             66         181           92         221

Product margin %             17.5%       16.5%*       17.3%       16.9%*
Service margin %             41.4%       38.6%        40.1%       37.7%

*Product margin percentages for the quarter and six months ended June 30, 1994
were 18.2% and 17.8%, respectively, before the impact of charges for downsizing
and other actions.
  10
                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES

  Consolidated revenues increased 6% and 9% for the three-month and six-month
periods ended June 30, 1995, respectively, over the comparable periods of 1994.
Foreign exchange translation had a favorable effect on revenue; excluding this
effect, consolidated revenues increased 3% and 6% for the three-month and six-
month periods ended June 30, 1995 over the comparable 1994 periods.  All
segments, excluding Flight Systems, reported increased revenues in the second
quarter. UTC's commercial and industrial segments increased 16% and 15% for the
three-month and six-month periods.  The aerospace segments, excluding the
impacts of the second quarter 1994 sale of the equity share holding in Westland
Group plc  and Norden divestiture, decreased 1% for the three-month period and
increased 4% for the six-month period.

  Financing revenues and other income decreased in the second quarter, from the
comparable period in the prior year,  principally as a result of the absence of
an $87 million gain realized on the sale of the equity share holding in Westland
Group plc and the sale of an additional participation interest in the PW4000
engine program by Pratt & Whitney in 1994. In addition to these effects,
financing revenues and other income also decreased due to lower financing
revenues in 1995 on a lower customer financing asset base, and a loss on an in-
substance defeasance of debt  and related interest rate hedge cancellation in
the second quarter, offset by a gain realized by Carrier on the sale of a 49%
joint venture interest in its Arkadelphia scroll compressor plant.  Financing
revenues and other income for the six-month period 1994 include a $51 million
charge relating to the adoption of SOP 93-6, "Employers' Accounting for Employee
Stock Ownership Plans". Excluding this effect, financing revenues and other
income for the six-month period decreased principally due to the same effects as
in the second quarter.


  Product margin as a percentage of sales for the six-month period, before the
impact of the 1994 charges for downsizing and other actions, was down slightly
from last year as improved margin percentages at Pratt & Whitney, Carrier and
Hamilton Standard were offset by decreases at Automotive, Sikorsky and Otis.
Service margins as a percentage of sales improved in most of the Corporation's
businesses.

  Research and development expenses decreased $28 million (11%) and $50 million
(10%) in the 1995 second quarter and six-month period, respectively, as compared
to 1994.  As a percentage of revenue, research and development was 4.0% in the
three-month and six-month periods of 1995 compared to 4.8% and 4.9% in the
corresponding periods last year.  These decreases primarily occurred at Pratt &
Whitney, due to the completion of the development phases of the PW4084 and
PW4168 commercial engines, and at Flight Systems.  Research and development
expenses in 1995 are expected to be slightly below the spending level of 1994.

  Selling, general and administrative expenses in the 1995 second quarter and
six-month period increased by $24 million (4%) and $50 million (4%) over the
1994 comparable periods.  However, as a percentage of revenues, these expenses
decreased from 11.8% to 11.5% for the three-month period and from 12.2% to 11.6%
for the six-month period as the Corporation achieved increased sales while
continuing to control expenses.
  11
                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES

  Segment revenues and operating profits in the Corporation's principal
business segments for the three-month and six-month periods ended June 30, 1995
and 1994 are as follows (in millions of dollars):


                                                             Operating
                           Revenues      Operating Profits Profit Margin
                         1995     1994     1995     1994    1995   1994
                                                
Three Months Ended
June 30,
  Otis                $  1,350 $  1,136 $   124  $   101    9.2%   8.9%
  Carrier                1,529    1,346     130      107    8.5%   7.9%
  Automotive               797      695      62       56    7.8%   8.1%
  Pratt & Whitney        1,495    1,478     127       53    8.5%   3.6%
  Flight Systems           703      854      59       99    8.4%  11.6%

Six Months Ended
June 30,
  Otis                $  2,535 $  2,190 $   234  $   198    9.2%   9.0%
  Carrier                2,660    2,358     159      125    6.0%   5.3%
  Automotive             1,547    1,308     113      100    7.3%   7.6%
  Pratt & Whitney        2,986    2,838     252      137    8.4%   4.8%
  Flight Systems         1,516    1,660     104      146    6.9%   8.8%


  Otis segment revenues for the three-month and six-month periods ended June
30, 1995 were 19% and 16% higher than the comparable periods of 1994.  Excluding
the favorable impact of foreign exchange translation effects, 1995 revenues
increased 9% and 7% for the second quarter and six-month period over 1994 with
all geographic regions showing an increase compared to last year.

  Operating profits at Otis increased $23 million and $36 million in the second
quarter and six-month periods of 1995 compared to 1994.  Approximately $12
million and $20 million of these respective increases were due to favorable
foreign exchange translation effects with the balance due principally to
improved performance in the Asia Pacific and North American regions.

  Carrier 1995 second quarter and six-month period revenues increased 14% and
13% from 1994, respectively.  Excluding the favorable impact of foreign exchange
translation effects, 1995 revenues increased 10% and 9% over the three-month and
six-month periods of 1994.  The increase in revenue was led by the recovery in
Europe and continued strong growth in the Asia Pacific region in both periods.

  Operating profits at Carrier increased $23 million and $34 million in the
second quarter and six-month period  of 1995 compared to 1994 with approximately
$6 million and $10 million of these respective increases due to favorable
foreign exchange translation effects.  Higher volumes and continued cost
reductions more than offset cost increases in raw materials such as copper and
aluminum.  Brazilian operations had improved profits, particularly in the first
quarter on a strong summer selling season.  In the second quarter, Carrier also
realized a gain from selling a 49% joint venture interest in its Arkadelphia
scroll compressor plant, which was substantially offset by charges for closure
and consolidation of certain facilities, inventory reserves, and start-up costs
of four new joint ventures in China.

  Automotive segment revenues increased 15% and 18% in the 1995 second quarter
and six-month period as compared to 1994. Revenue increases in both periods were


  12
                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES

a result of higher vehicle content, and favorable product mix in North America
and increased market penetration in Europe.

  Operating profits at the Automotive segment increased $6 million and $13
million in the 1995 second quarter and six-month periods compared to the same
periods in 1994, while margins as a percentage of revenue decreased 0.3%. The
positive effects of higher revenues in Europe and North America were partially
offset by global increases in raw material  costs and continuing costs in
support of new vehicle model awards in North America.

  Pratt & Whitney revenue during the second quarter and six-month periods ended
June 30, 1995 increased 1% and 5% as compared to 1994; however, revenues for the
full year are expected to be essentially the same as last year.  The increase in
the second quarter over the prior year is due to modest increases in the
government and general aviation businesses.  The increase for the six-month
period is principally due to increased shipments of large commercial engines,
and increased shipments of general aviation engines and spare parts by Pratt &
Whitney Canada.

  Operating profits for Pratt & Whitney for the second quarter and six-month
periods ended June 30, 1995 increased $74 million and $115 million over the
comparable periods of 1994.  The increases are due to improved margins arising
from cost reduction initiatives, reduced research and development expenses and
the absence of a $50 million downsizing charge in the second quarter of 1994,
partially offset by the absence of the sale of a participation interest in the
PW4000 engine program in the second quarter of 1994.

  Flight Systems revenues decreased 18% and 9% in the second quarter and six-
month periods ended June 30, 1995 compared to 1994.  Revenue decreases were a
result of the second quarter 1994 sale of the equity share holding in Westland
Group plc and the Norden divestiture and lower revenues at Sikorsky in the
second quarter of 1995.  Hamilton Standard revenues in 1995 are expected to
remain flat compared to last year while revenues at Sikorsky are expected to
decrease versus last year due to fewer scheduled deliveries of helicopters.

  Operating profits for Flight Systems decreased $40 million and $42 million in
the second quarter and six-month periods ended June 30, 1995 as compared to
1994. Second quarter 1994 results include an $87 million gain realized in Flight
Systems on the sale of the equity share holding in Westland Group plc and $35
million in downsizing charges.  Operating profits excluding those items
increased $12 million and $10 million in the second quarter and six-month
periods ended June 30, 1995.  The increase reflects improved operating
performance at Hamilton Standard, partially offset by reduced operating profits
at Sikorsky as a result of lower volumes.  The six-month period results reflect
improved performance at Hamilton Standard, offset by costs associated with
closing the wafer fabrication facility of Hamilton Standard's Microelectronics
Center and charges for a workforce reduction at Sikorsky.

  Interest expense decreased $6 million and $10 million in the three-month and
six-month periods ended June 30, 1995 to $67 million and $129 million,
respectively.  This decrease is mainly due to a reduced average borrowing level
during the quarter as compared to last year, partially offset by increased
interest rates.

  The effective tax rate for the first six months of 1995 was 34.8%, compared
to an effective tax rate of 36.7% for the corresponding period of 1994.  The
Corporation has reduced its effective income tax rate by implementing tax
reduction strategies.
  13
                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES

                   FINANCIAL POSITION AND LIQUIDITY

  Management assesses the Corporation's liquidity in terms of its overall
ability to generate cash to fund its operating and investing activities.  Of
particular importance in the management of liquidity are cash flows generated
from operating activities, capital expenditure levels, customer financing
requirements, adequate bank lines of credit, and financial flexibility to
attract long-term capital on satisfactory terms.

  Set forth below is selected key cash flow data:


                                                    Six Months Ended
                                                        June 30,
In Millions of Dollars                             1995          1994
                                                     
Operating Activities
  Net Cash Flows from Operating Activities   $       845   $       117

Investing Activities
  Capital expenditures                              (331)         (290)
  Dispositions of business units                      88           227
  Decrease in customer financing assets, net         170           105

Financing Activities
  Common Stock repurchase                            (90)          (52)
  Increase (decrease) in total debt                 (204)          231
  Increase (decrease) in net debt                   (573)           85



  Cash flows from operating activities were $845 million during the first six
months of 1995 compared to $117 million for the corresponding period of 1994.
The improvement resulted primarily from improved operating performance and
working capital management, and the absence of a $150 million payment to the
U.S. Government made in the second quarter 1994 for a previously reported
settlement by Sikorsky Aircraft.

  Cash flows from investing activities were a use of funds of $43 million
during the first six months of 1995 compared to a  $31 million use in the
corresponding period of 1994.  During the six-month period ended June 30, 1995,
the Corporation received proceeds of $88 million from dispositions of business
units, the largest item being proceeds received in the second quarter of 1995
from the sale of a 49% joint venture interest in Carrier's Arkadelphia scroll
compressor plant.  Capital expenditures in the six-month period of 1995 were
$331 million, a $41 million increase over the corresponding period of 1994.  The
Corporation expects 1995 full year capital spending to remain at approximately
the same level as 1994.  The decrease in customer financing assets in the 1995
period includes the effect of loan repayments and asset sales.  While the
Corporation now believes that changes in customer financing assets in 1995 will
be a net source of funds, actual funding is subject to usage under existing
customer financing commitments during the remainder of the year.

  The Corporation repurchased $90 million of common stock, representing 1.25
million shares, in the first six months of 1995 under previously announced stock
repurchase programs.
  14
                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES

  Other selected financial data is as follows:


                                   June 30,    December 31,   June 30,
In Millions of Dollars               1995          1994         1994
                                                   
Cash and cash equivalents        $      755   $      386    $      567
Total debt                            2,239        2,443         3,190
Net debt (total debt less cash)       1,484        2,057         2,623
Shareowners' equity                   3,928        3,752         3,672
Debt-to-total capitalization           36.3%        39.4%         46.5%
Net debt-to-total capitalization       27.4%        35.4%         41.7%




  In June, the Corporation executed an in-substance defeasance of $100 million
of its 9-5/8% notes due May 15, 1999, callable on or after May 15, 1996.  The
Corporation deposited U.S. Government securities into an irrevocable trust to
cover the interest and principal payments on this debt and as part of this
transaction, the Corporation also gave irrevocable notice to the indenture
trustee for these notes of its election to exercise its rights to redeem the
notes on May 15, 1996.  For financial reporting purposes, the debt has been
considered extinguished and the loss on this transaction, which was immaterial,
is included in Financing revenues and other income, net.

  During the second quarter, the Corporation canceled $300 million of
outstanding interest rate hedges.  As a result of debt reduction and these
contract cancellations, the percentage of total debt at floating interest rates,
after taking effect of the remaining outstanding interest rate contracts, is 32%
at June 30, 1995, versus 42% at December 31, 1994.

  Management believes that its existing cash position and other available
sources of liquidity are sufficient to meet current and anticipated requirements
for the foreseeable future.
  15
                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES

Part II - Other Information

Item 1.   Legal Proceedings

  There has been no material change in legal proceedings during the second
quarter of 1995.  (For a description of previously reported legal proceedings,
refer to Part 1, Item 3 - Legal Proceedings of the Corporation's Annual Report
on Form 10K for calendar year 1994 to part II, Item 1 - Legal Proceedings of the
Corporation's Report on Form 10Q for the first quarter of calendar year 1995.)

Item 4.   Submission of Matters to a Vote of Security Holders

(a)  The Corporation held its Annual Meeting of Shareowners on April 25, 1995.

(b)  The following individuals were nominated and elected to serve as directors:

Howard H. Baker, Jr., Antonia H. Chayes, Robert F. Daniell, George David, Robert
F. Dee, Charles W. Duncan, Jr., Pehr G. Gyllenhammar, Gerald D. Hines, Charles
R. Lee, Robert H. Malott, Harold A. Wagner, and Jacqueline G. Wexler.

(c)  The shareowners voted as follows on the following matters:

     1.  Election of directors.  The voting result for each nominee is as
follows:  Howard H. Baker, Jr. - 119,956,662 votes for, 935,769 votes withheld.
Antonia Handler Chayes - 119,957,217 votes for, 935,214 votes withheld, Robert
F. Daniell - 119,958,250 votes for, 934,181 votes withheld, George David -
119,953,833 votes for, 938,598 votes withheld, Robert F. Dee - 119,927,426 votes
for, 965,005 votes withheld, Charles W. Duncan, Jr. - 119,957,701 votes for,
934,730 votes withheld, Pehr G. Gyllenhammar - 119,914,210 votes for, 978,221
votes withheld, Gerald D. Hines - 119,965,253 votes for, 927,178 votes withheld,
Charles R. Lee - 119,989,205 votes for, 903,226 votes withheld, Robert H. Malott
- - 119,960,602 votes for, 931,829 votes withheld, Harold A. Wagner - 119,985,740
votes for, 906,691 votes withheld, and Jacqueline G. Wexler - 119,926,151 votes
for, 966,280 votes withheld.

     2.  Appointment of auditors.  The proposal was approved by a count of
120,204,699 votes for, 522,146 votes against, and 165,586 votes abstaining.

     3.  A management proposal to amend the Corporation's Annual Executive
Incentive Compensation Plan was approved by a count of 108,515,566 votes for,
11,391,596 votes against, and 985,269 votes abstaining.

     4.  A management proposal to amend the Corporation's Long Term Incentive
Plan was approved by a count of 104,945,244 votes for, 14,933,171 votes against,
and 1,014,016 votes abstaining.

     5.  A shareowner proposal recommending that the Corporation provide to
shareowners a list of all executives contractually entitled to receive a base
salary in excess of $100,000 annually was rejected by a count of 20,220,934
votes for, 90,385,215 votes against, with 4,533,199 votes abstaining, and
5,753,083 broker non-votes.
  16
                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES

Item 6.   Exhibits and Reports on Form 8-K

(a)  Exhibits:

  (11)  Computation of per share earnings
  (12)  Computation of ratio of earnings to fixed charges
  (15)  Letter re unaudited interim financial information
  (27)  Financial data schedule (submitted electronically herewith)

(b)  No reports on Form 8-K were filed during the quarter ended June 30, 1995.
  17
                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES


                              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 thereunto duly authorized.



                               UNITED TECHNOLOGIES CORPORATION


Dated:  August 3, 1995         By:  Stephen F. Page  
                               Stephen F. Page
                               Executive Vice President and
                               Chief Financial Officer


Dated:  August 3, 1995         By:  George E. Minnich
                               George E. Minnich
                               Vice President and Controller


Dated:  August 3, 1995         By:  William H. Trachsel
                               William H. Trachsel
                               Vice President and Secretary
  18
                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES


EXHIBIT INDEX



Exhibit 11 - Computation of per share earnings

Exhibit 12 - Computation of ratio of earnings to fixed charges

Exhibit 15 - Letter re unaudited interim financial information

Exhibit 27 - Financial data schedule (submitted electronically herewith)



                                                            Exhibit 11



                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES

                  COMPUTATION OF PER SHARE EARNINGS



                                                              Three Months Ended
                                                                   June 30,
In Millions of Dollars (except per share amounts)             1995           1994
                                                                

Earnings applicable to Common Stock                    $        211   $        160
ESOP Convertible Preferred Stock adjustment                       5              4

Net earnings for calculation of primary and fully
  diluted earnings per share                           $        216   $        164

Average number of common shares and common stock
  equivalents outstanding during period (four month-
  end average)                                          130,964,343    133,189,518
Fully diluted average number of common shares and
  common stock equivalents outstanding during period
  (four month-end average)                              131,294,781    133,361,893

Primary earnings per common share                      $       1.65   $       1.23
Fully diluted earnings per common share (Note1)        $       1.64   $       1.23





Note 1 - Fully diluted earnings per common share is less than 3% dilutive and is
     not shown separately on the Condensed Consolidated Statement of
     Operations.


                                                            Exhibit 11



                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES

                  COMPUTATION OF PER SHARE EARNINGS



                                                               Six Months Ended
                                                                   June 30,
In Millions of Dollars (except per share amounts)             1995           1994
                                                                

Earnings applicable to Common Stock                    $        340   $        222
ESOP Convertible Preferred Stock adjustment                      10              8

Net earnings for calculation of primary and fully
  diluted earnings per share                           $        350   $        230

Average number of common shares and common stock
  equivalents outstanding during period (seven month-
  end average)                                          130,376,338    132,986,086
Fully diluted average number of common shares and
  common stock equivalents outstanding during period
  (seven month-end average)                             131,125,451    133,155,254

Primary earnings per common share                      $       2.68   $       1.73
Fully diluted earnings per common share (Note 1)       $       2.67   $       1.73





Note 1 - Fully diluted earnings per common share is less than 3% dilutive and is
     not shown separately on the Condensed Consolidated Statement of
     Operations.



                                                            Exhibit 12


                   UNITED TECHNOLOGIES CORPORATION
                           AND SUBSIDIARIES

          COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES



                                                                Six Months Ended
                                                                    June 30,
 In Millions of Dollars                                        1995           1994
                                                                 
 Fixed Charges:
   Interest on indebtedness                             $        129   $        139
   Interest capitalized                                           10             12
   One-third of rents*                                            46             51

   Total Fixed Charges                                  $        185   $        202

 Earnings:
   Income before income taxes and minority interests    $        634   $        444

   Fixed charges per above                                       185            202
   Less: interest capitalized                                   (10)           (12)
                                                                 175            190

   Amortization of interest capitalized                           19             22

   Total Earnings                                       $        828   $        656

 Ratio of Earnings to Fixed Charges                             4.48           3.25



* Reasonable approximation of the interest factor.
/TABLE






                                                            Exhibit 15





July 26, 1995

Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, DC 20549

Dear Sirs:

We are aware that United Technologies Corporation has incorporated by reference
our report dated July 26, 1995 (issued pursuant to the provisions of Statement
on Auditing Standards No. 71) in the Prospectus constituting part of its
Registration Statements on Form S-3 (Nos. 33-46916, 33-40163, 33-34320, 33-
31514, 33-29687, and 33-6452) and Form S-8 (Nos. 33-57769, 33-45440, 33-11255,
33-26580, 33-26627, 33-28974, 33-51385, 33-58937 and 2-87322).  We are also
aware of our responsibilities under the Securities Act of 1933.

Yours very truly,



Price Waterhouse LLP

 

 5

The schedule contains summary financial information extracted from the Condensed
Consolidated Balance Sheet at June 30, 1995 (Unaudited) and the Condensed
Consolidated Statement of Operations for the six months ended June 30, 1995
(Unaudited) and is qualified in its entirety by reference to such financial
statements.

 1,000,000
       
                             
                   6-MOS
                          DEC-31-1995
                             JAN-01-1995
                               JUN-30-1995
                                             755
                                         0
                                    3,913
                                       347
                                      3,148
                                 8,600
                                          10,398
                                   5,944
                                  15,826
                            6,440
                                          1,753
                                         2,212
                              371
                                          0
                                       1,716
                    15,826
                                          8,865
                                11,184
                                            7,334
                                    8,669
                                   451
                                     0
                                 129
                                    634
                                       220
                                353
                                       0
                                      0
                                            0
                                       353
                                     2.68
                                     2.68