Honeywell International reported a slightly better-than-expected quarterly profit, as an improving US economy helped boost sales at the company's division that makes sensors, safety systems and air conditioning equipment.

Sales in the company's automation and control business increased 2.8 per cent, partially offsetting a 5.8 per cent decline in its aerospace business and helping the company beat average analyst expectation.

Honeywell reported net sales of $10.27 billion in the fourth quarter ended December 31.

Analysts, on average, had expected $10.21 billion, according to Thomson Reuters I/B/E/S.

'Pleasingly, sales came in above expectations '“ small, but important since sales weakness has in the past been punished by the market,' Morgan Stanley analyst Nigel Coe wrote in a note.

Sales from the company's aerospace business was hurt by discounts to plane makers and a strengthening dollar.

The dollar rose nearly 13 per cent in 2014, its biggest yearly gain since 1997, when measured against a basket of major currencies. Honeywell derives more than half of its total revenue from outside the US.

Net income attributable to Honeywell rose to $956 million, or $1.20 per share, from $947 million, or $1.19 per share, a year earlier, as the company had to pay less tax.

Tax expenses fell 30.7 per cent to $329 million.

Excluding items, the company earned $1.43 per share, topping average analyst estimate of $1.42 per share.

The stock has risen 9.11 per cent in the past year, against a 11.83 per cent rise in the S&P500 Index.