Exhibit 99.1
 | Raytheon Company |  | ||
Global Headquarters | ||||
Waltham, Mass. | ||||
Investor Relations Contact | ||||
Todd Ernst | ||||
781.522.5141 | ||||
Media Contact | ||||
Pam Erickson | ||||
781.522.5822 | ||||
For Immediate Release
Raytheon Reports Solid Third Quarter 2015 Results
• | Solid bookings of $5.3 billion |
• | Net sales of $5.8 billion, up 6 percent |
• | EPS from continuing operations of $1.47 |
• | Strong operating cash flow from continuing operations of $1.1 billion |
__________________________________________________________________________________________________
WALTHAM, Mass., (October 22, 2015) - Raytheon Company (NYSE: RTN) announced net sales for the third quarter 2015 of $5.8 billion compared to $5.5 billion in the third quarter 2014. Third quarter 2015 EPS from continuing operations was $1.47 compared to $1.65 in the third quarter 2014. Third quarter 2015 EPS from continuing operations included, as expected, a $0.09 unfavorable impact associated with Raytheon|Websense (RW) acquisition accounting adjustments discussed in further detail below.
"I’m very pleased with our strong revenue growth and cash flow generation in the third quarter," said Thomas A. Kennedy, Raytheon Chairman and CEO. "The Raytheon team remains focused on driving future growth by developing and delivering innovative solutions that address our global customers’ most complex challenges."
Operating cash flow from continuing operations for the third quarter 2015 was $1.1 billion compared to $0.4 billion for the third quarter 2014. The increase in operating cash flow from continuing operations in the third quarter 2015 was primarily due to favorable working capital in the quarter and the timing of cash taxes. Year-to-date operating cash flow from continuing operations was $1.5 billion in 2015 versus $1.2 billion for the comparable period in 2014. The increase in operating cash flow from continuing operations in 2015 was primarily due to the timing of required pension contributions and the collection of the eBorders settlement with the U.K. Home Office, which was resolved in the first quarter 2015, partially offset by higher cash taxes.
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Summary Financial Results | |||||||||||||||||||
3rd Quarter | % | Nine Months | % | ||||||||||||||||
($ in millions, except per share data) | 2015 | 2014 | Change | 2015 | 2014 | Change | |||||||||||||
Bookings | $ | 5,315 | $ | 5,878 | -9.6% | $ | 17,366 | $ | 16,943 | 2.5% | |||||||||
Net Sales | $ | 5,783 | $ | 5,474 | 5.6% | $ | 16,919 | $ | 16,683 | 1.4% | |||||||||
Income from Continuing Operations attributable to Raytheon Company | $ | 448 | $ | 515 | -13.0% | $ | 1,503 | $ | 1,603 | -6.2% | |||||||||
EPS from Continuing Operations | $ | 1.47 | $ | 1.65 | -10.9% | $ | 4.91 | $ | 5.11 | -3.9% | |||||||||
Operating Cash Flow from Continuing Operations | $ | 1,102 | $ | 423 | $ | 1,533 | $ | 1,235 | |||||||||||
Workdays in Fiscal Reporting Calendar | 63 | 63 | 188 | 189 | |||||||||||||||
The Company had bookings of $5.3 billion in the third quarter 2015 compared to $5.9 billion in the third quarter 2014. Year-to-date 2015 bookings were $17.4 billion, resulting in a year-to-date book-to-bill ratio of 1.03 and 1.06 on a trailing four quarter basis. Year-to-date 2014 bookings were $16.9 billion.
In the third quarter 2015, the Company repurchased 2.4 million shares of common stock for $250 million. Year-to-date 2015, the Company repurchased 7.0 million shares of common stock for $750 million.
The Company ended the third quarter 2015 with $2.3 billion of net debt. Net debt is defined as total debt less cash and cash equivalents and short-term investments.
Third quarter 2015 results include items related to the Raytheon|Websense transaction which are excluded from segment operating performance since management does not consider those items in evaluating the segment.
Raytheon|Websense Acquisition Accounting Adjustments1 | |||||||
($ in millions, except per share data) | Operating Income | EPS | |||||
Deferred Revenue Adjustment2 | $ | (27 | ) | $ | (0.05 | ) | |
Amortization of Intangibles | $ | (24 | ) | $ | (0.04 | ) | |
Acquisition Related Costs | $ | (1 | ) | $ | — | ||
Amounts excluded from segment results | $ | (52 | ) | $ | (0.09 | ) | |
1See Attachment F for a reconciliation of how each of these items is calculated. | |||||||
2Deferred Revenue Adjustment represents the impact of fair value adjustments to deferred revenue related to Raytheon|Websense, including historical Raytheon Cyber Products acquisitions. | |||||||
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Backlog
($ in millions) | Period Ending | ||||||||||
Q3 2015 | Q3 2014 | 2014 | |||||||||
Backlog | $ | 33,571 | $ | 33,247 | $ | 33,571 | |||||
Funded Backlog | $ | 24,361 | $ | 22,888 | $ | 23,092 | |||||
Backlog at the end of the third quarter 2015 was $33.6 billion, an increase of approximately $0.3 billion compared to the third quarter 2014. Funded backlog was $24.4 billion, an increase of approximately $1.5 billion compared to the third quarter 2014.
Outlook
The Company has updated its financial outlook for 2015 for higher sales and to reflect actuarial updates to its pension plans. Charts containing additional information on the Company's 2015 outlook are available on the Company's website at www.raytheon.com/ir.
2015 Financial Outlook | |||
Current1 | Prior (7/23/15) | ||
Net Sales ($B) | 23.0 - 23.3* | 22.7 - 23.2 | |
RW Deferred Revenue Adjustment ($M)2 | (61) | (61) | |
RW Amortization of Intangibles ($M)2 | (58) | (58) | |
FAS/CAS Adjustment ($M) | 185* | 197 | |
Interest Expense, net ($M) | (225) - (235) | (225) - (235) | |
Diluted Shares (M) | Approx. 305* | 305 - 306 | |
Effective Tax Rate | Approx. 27.0% | Approx. 27.0% | |
EPS from Continuing Operations | $6.47 - $6.62 | $6.47 - $6.62 | |
Operating Cash Flow from Continuing Operations ($B) | 2.5 - 2.7 | 2.5 - 2.7 | |
1Reflects a $12 million or $0.03 per share reduction in FAS/CAS Adjustment due to the annual update in Q3 2015 of our actuarial estimates for pension and other postretirement benefit plans. | |||
2RW Deferred Revenue Adjustment and RW Amortization of Intangibles represent the unfavorable impact of the acquisition accounting adjustments to record acquired deferred revenue at fair value and the amortization of acquired intangible assets, respectively, related to Raytheon|Websense, including historical Raytheon Cyber Products acquisitions. | |||
* Denotes change from prior guidance. | |||
Segment Results
The Company's reportable segments are: Integrated Defense Systems (IDS); Intelligence, Information and Services (IIS); Missile Systems (MS); Space and Airborne Systems (SAS); and Raytheon|Websense (RW).
Integrated Defense Systems | |||||||||||||||||||
3rd Quarter | Nine Months | ||||||||||||||||||
($ in millions) | 2015 | 2014 | % Change | 2015 | 2014 | % Change | |||||||||||||
Net Sales | $ | 1,533 | $ | 1,428 | 7% | $ | 4,664 | $ | 4,458 | 5% | |||||||||
Operating Income | $ | 212 | $ | 230 | -8% | $ | 622 | $ | 675 | -8% | |||||||||
Operating Margin | 13.8 | % | 16.1 | % | 13.3 | % | 15.1 | % | |||||||||||
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Integrated Defense Systems (IDS) had third quarter 2015 net sales of $1,533 million, up 7 percent compared to $1,428 million in the third quarter 2014. The increase in net sales was primarily driven by higher sales on international Patriot programs.
IDS recorded $212 million of operating income in the third quarter 2015 compared to $230 million in the third quarter 2014. The change in operating income in the third quarter 2015 was primarily due to a change in program mix.
During the quarter, IDS booked $158 million to continue development on the Air Defense Operations Center (ADOC) for Qatar.
Intelligence, Information and Services | |||||||||||||||||||
3rd Quarter | Nine Months | ||||||||||||||||||
($ in millions) | 2015 | 2014 | % Change | 2015 | 2014 | % Change | |||||||||||||
Net Sales | $ | 1,438 | $ | 1,450 | -1% | $ | 4,306 | $ | 4,372 | -2% | |||||||||
Operating Income1 | $ | 108 | $ | 118 | -8% | $ | 500 | $ | 364 | NM | |||||||||
Operating Margin | 7.5 | % | 8.1 | % | 11.6 | % | 8.3 | % | |||||||||||
1 Nine Months 2015 operating income includes the favorable $181 million impact of the first quarter 2015 eBorders settlement. | |||||||||||||||||||
NM = Not Meaningful | |||||||||||||||||||
Intelligence, Information and Services (IIS) had third quarter 2015 net sales of $1,438 million compared to $1,450 million in the third quarter 2014.
IIS recorded $108 million of operating income in the third quarter 2015 compared to $118 million in the third quarter 2014. The change in operating income was primarily due to lower volume, a change in program mix, and acquisition-related costs.
During the quarter, IIS booked $295 million on domestic and foreign training programs in support of Warfighter FOCUS activities. IIS booked $98 million to provide development and sustainment support for the National Cybersecurity Protection System (NCPS) for the U.S. Department of Homeland Security (DHS). This award was protested on October 5, 2015. IIS also booked $555 million on a number of classified contracts.
Missile Systems | |||||||||||||||||||
3rd Quarter | Nine Months | ||||||||||||||||||
($ in millions) | 2015 | 2014 | % Change | 2015 | 2014 | % Change | |||||||||||||
Net Sales | $ | 1,645 | $ | 1,477 | 11% | $ | 4,677 | $ | 4,590 | 2% | |||||||||
Operating Income | $ | 219 | $ | 190 | 15% | $ | 609 | $ | 588 | 4% | |||||||||
Operating Margin | 13.3 | % | 12.9 | % | 13.0 | % | 12.8 | % | |||||||||||
Missile Systems (MS) had third quarter 2015 net sales of $1,645 million, up 11 percent compared to $1,477 million in the third quarter 2014. The increase in net sales was driven by higher sales spread across various production programs, including the Tube-launched, Optically-tracked, Wireless-guided (TOW®) missiles program, and certain missile defense programs.
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MS recorded $219 million of operating income in the third quarter 2015 compared to $190 million in the third quarter 2014. The increase in operating income was primarily due to higher volume in the third quarter 2015 and a change in program mix.
During the quarter, MS booked $490 million for AIM-9X® Sidewinder short-range air-to-air missiles for U.S. and international customers and $480 million for Paveway™ for the U.S. Air Force and international customers. MS also booked $183 million for the Joint Standoff Weapon (JSOW) for the U.S. Navy, U.S. Air Force and an international customer, and $93 million for Standard Missile-3 (SM-3®) for the Missile Defense Agency (MDA) and an international customer.
Space and Airborne Systems | |||||||||||||||||||
3rd Quarter | Nine Months | ||||||||||||||||||
($ in millions) | 2015 | 2014 | % Change | 2015 | 2014 | % Change | |||||||||||||
Net Sales | $ | 1,446 | $ | 1,509 | -4% | $ | 4,220 | $ | 4,412 | -4% | |||||||||
Operating Income | $ | 204 | $ | 237 | -14% | $ | 563 | $ | 629 | -10% | |||||||||
Operating Margin | 14.1 | % | 15.7 | % | 13.3 | % | 14.3 | % | |||||||||||
Space and Airborne Systems (SAS) had third quarter 2015 net sales of $1,446 million compared to $1,509 million in the third quarter 2014. The change in net sales was primarily due to lower sales on international tactical radar systems programs.
SAS recorded $204 million of operating income in the third quarter 2015 compared to $237 million in the third quarter 2014. The change in operating income was primarily due to higher net program efficiencies in the third quarter 2014.
During the quarter, SAS booked $106 million for the production of Active Electronically Scanned Array (AESA) radars for the U.S. Air Force and $92 million to provide radar spares for an international customer. SAS also booked $382 million on a number of classified contracts.
Raytheon|Websense1 | |||||||||||||||||||
3rd Quarter | Nine Months | ||||||||||||||||||
($ in millions) | 2015 | 2014 | % Change | 2015 | 2014 | % Change | |||||||||||||
Net Sales | $ | 114 | $ | 30 | NM | $ | 195 | $ | 81 | NM | |||||||||
Operating Income | $ | 20 | $ | 5 | NM | $ | 19 | $ | 12 | NM | |||||||||
Operating Margin | 17.5 | % | 16.7 | % | 9.7 | % | 14.8 | % | |||||||||||
1 Excludes the unfavorable impact of the Raytheon|Websense acquisition accounting adjustments and certain acquisition related costs. See page 2 for more information on these items. | |||||||||||||||||||
NM = Not Meaningful | |||||||||||||||||||
Raytheon|Websense (RW) had third quarter 2015 net sales of $114 million compared to $30 million in the third quarter 2014. RW recorded $20 million of operating income in the third quarter 2015 compared to $5 million in the third quarter 2014. The increase in net sales and operating income in the third quarter 2015 was primarily due to the acquisition of Websense.
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About Raytheon
Raytheon Company, with 2014 sales of $23 billion and 61,000 employees worldwide, is a technology and innovation leader specializing in defense, civil government and cybersecurity markets throughout the world. With a history of innovation spanning 93 years, Raytheon provides state-of-the-art electronics, mission systems integration and other capabilities in the areas of sensing; effects; and command, control, communications and intelligence systems, as well as cybersecurity and a broad range of mission support services. Raytheon is headquartered in Waltham, Mass. For more about Raytheon, visit us at www.raytheon.com and follow us on Twitter @raytheon.
Conference Call on the Third Quarter 2015 Financial Results
Raytheon's financial results conference call will be held on Thursday, October 22, 2015 at 9 a.m. ET. Participants will include Thomas A. Kennedy, Chairman and CEO; Anthony F. O'Brien, vice president and CFO; and other Company executives.
The dial-in number for the conference call will be (800) 299-8538 in the U.S. or (617) 786-2902 outside of the U.S. The conference call will also be audiocast on the Internet at www.raytheon.com/ir. Individuals may listen to the call and download charts that will be used during the call. These charts will be available for printing prior to the call.
Interested parties are encouraged to check the website ahead of time to ensure their computers are configured for the audio stream. Instructions for obtaining the free required downloadable software are posted on the site.
Disclosure Regarding Forward-looking Statements
This release and the attachments contain forward-looking statements, including information regarding the Company's financial outlook, future plans, objectives, business prospects and anticipated financial performance. These forward-looking statements are not statements of historical facts and represent only the Company's current expectations regarding such matters. These statements inherently involve a wide range of known and unknown risks and uncertainties. The Company's actual actions and results could differ materially from what is expressed or implied by these statements. Specific factors that could cause such a difference include, but are not limited to: the Company's dependence on the U.S. Government for a significant portion of its business and the risks associated with U.S. Government sales, including changes or shifts in defense spending due to budgetary constraints, spending cuts resulting from sequestration under the amended Budget Control Act of 2011, a government shutdown, or otherwise, uncertain funding of programs, potential termination of contracts, and difficulties in contract performance; the resolution of program terminations; the ability to procure new contracts; the risks of conducting business in foreign countries; the unpredictability of timing of international bookings; the ability to comply with extensive governmental regulation and obtain approvals, including import and export policies, the Foreign Corrupt Practices Act, the International Traffic in Arms Regulations, industrial cooperation agreement obligations, and procurement and other regulations; the impact of competition; the ability to develop products and technologies; the impact of changes in the financial markets and global economic conditions; the risk that actual pension returns, discount rates or other actuarial assumptions are significantly different than the
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Company's assumptions; the risk of cost overruns, particularly for the Company's fixed-price contracts; dependence on component availability, subcontractor and partner performance and key suppliers; risks of a negative government audit; the use of accounting estimates in the Company's financial statements; risks associated with acquisitions, dispositions, joint ventures and other business arrangements; risks of an impairment of goodwill or other intangible assets; the outcome of contingencies and litigation matters, including government investigations; the ability to recruit and retain qualified personnel; the impact of potential security and cyber threats, and other disruptions; and other factors as may be detailed from time to time in the Company's public announcements and Securities and Exchange Commission filings. The Company undertakes no obligation to make any revisions to the forward-looking statements contained in this release and the attachments or to update them to reflect events or circumstances occurring after the date of this release, including any acquisitions, dispositions or other business arrangements that may be announced or closed after such date. This release and the attachments also contain non-GAAP financial measures. A GAAP reconciliation and a discussion of the Company's use of these measures are included in this release or the attachments.
# # #
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Attachment A | ||||||||||||||||
Raytheon Company | ||||||||||||||||
Preliminary Statement of Operations Information | ||||||||||||||||
Third Quarter 2015 | ||||||||||||||||
(In millions, except per share amounts) | Three Months Ended | Nine Months Ended | ||||||||||||||
27-Sep-15 | 28-Sep-14 | 27-Sep-15 | 28-Sep-14 | |||||||||||||
Net sales | $ | 5,783 | $ | 5,474 | $ | 16,919 | $ | 16,683 | ||||||||
Operating expenses | ||||||||||||||||
Cost of sales | 4,408 | 4,171 | 12,766 | 12,633 | ||||||||||||
General and administrative expenses | 678 | 540 | 1,968 | 1,740 | ||||||||||||
Total operating expenses | 5,086 | 4,711 | 14,734 | 14,373 | ||||||||||||
Operating income | 697 | 763 | 2,185 | 2,310 | ||||||||||||
Non-operating (income) expense, net | ||||||||||||||||
Interest expense | 58 | 53 | 175 | 158 | ||||||||||||
Interest income | (3 | ) | (3 | ) | (9 | ) | (8 | ) | ||||||||
Other (income) expense, net | 9 | 1 | 6 | (5 | ) | |||||||||||
Total non-operating (income) expense, net | 64 | 51 | 172 | 145 | ||||||||||||
Income from continuing operations before taxes | 633 | 712 | 2,013 | 2,165 | ||||||||||||
Federal and foreign income taxes | 189 | 193 | 513 | 552 | ||||||||||||
Income from continuing operations | 444 | 519 | 1,500 | 1,613 | ||||||||||||
Income (loss) from discontinued operations, net of tax | (1 | ) | — | — | 59 | |||||||||||
Net income | 443 | 519 | 1,500 | 1,672 | ||||||||||||
Less: Net income (loss) attributable to noncontrolling | ||||||||||||||||
interests in subsidiaries | (4 | ) | 4 | (3 | ) | 10 | ||||||||||
Net income attributable to Raytheon Company | $ | 447 | $ | 515 | $ | 1,503 | $ | 1,662 | ||||||||
Basic earnings (loss) per share attributable to Raytheon | ||||||||||||||||
Company common stockholders: | ||||||||||||||||
Income from continuing operations | $ | 1.47 | $ | 1.66 | $ | 4.91 | $ | 5.12 | ||||||||
Income (loss) from discontinued operations, net of tax | — | — | — | 0.19 | ||||||||||||
Net income | 1.47 | 1.66 | 4.92 | 5.31 | ||||||||||||
Diluted earnings (loss) per share attributable to Raytheon | ||||||||||||||||
Company common stockholders: | ||||||||||||||||
Income from continuing operations | $ | 1.47 | $ | 1.65 | $ | 4.91 | $ | 5.11 | ||||||||
Income (loss) from discontinued operations, net of tax | — | — | — | 0.19 | ||||||||||||
Net income | 1.47 | 1.65 | 4.91 | 5.30 | ||||||||||||
Amounts attributable to Raytheon Company common | ||||||||||||||||
stockholders: | ||||||||||||||||
Income from continuing operations | $ | 448 | $ | 515 | $ | 1,503 | $ | 1,603 | ||||||||
Income (loss) from discontinued operations, net of tax | (1 | ) | — | — | 59 | |||||||||||
Net income | $ | 447 | $ | 515 | $ | 1,503 | $ | 1,662 | ||||||||
Average shares outstanding | ||||||||||||||||
Basic | 303.9 | 310.9 | 305.8 | 312.9 | ||||||||||||
Diluted | 304.3 | 311.4 | 306.2 | 313.6 | ||||||||||||
Attachment B | ||||||||||||||||||||||
Raytheon Company | ||||||||||||||||||||||
Preliminary Segment Information | ||||||||||||||||||||||
Third Quarter 2015 | ||||||||||||||||||||||
Operating Income | ||||||||||||||||||||||
Net Sales | Operating Income | As a Percent of Net Sales | ||||||||||||||||||||
(In millions, except percentages) | Three Months Ended | Three Months Ended | Three Months Ended | |||||||||||||||||||
27-Sep-15 | 28-Sep-14 | 27-Sep-15 | 28-Sep-14 | 27-Sep-15 | 28-Sep-14 | |||||||||||||||||
Integrated Defense Systems | $ | 1,533 | $ | 1,428 | $ | 212 | $ | 230 | 13.8 | % | 16.1 | % | ||||||||||
Intelligence, Information and Services | 1,438 | 1,450 | 108 | 118 | 7.5 | % | 8.1 | % | ||||||||||||||
Missile Systems | 1,645 | 1,477 | 219 | 190 | 13.3 | % | 12.9 | % | ||||||||||||||
Space and Airborne Systems | 1,446 | 1,509 | 204 | 237 | 14.1 | % | 15.7 | % | ||||||||||||||
Raytheon|Websense(1) | 114 | 30 | 20 | 5 | 17.5 | % | 16.7 | % | ||||||||||||||
Eliminations | (366 | ) | (420 | ) | (49 | ) | (43 | ) | ||||||||||||||
Total business segment | 5,810 | 5,474 | 714 | 737 | 12.3 | % | 13.5 | % | ||||||||||||||
Raytheon|Websense Acquisition Accounting Adjustments | (27 | ) | — | (51 | ) | (1 | ) | |||||||||||||||
FAS/CAS Adjustment | — | — | 43 | 42 | ||||||||||||||||||
Corporate | — | — | (9 | ) | (15 | ) | ||||||||||||||||
Total | $ | 5,783 | $ | 5,474 | $ | 697 | $ | 763 | 12.1 | % | 13.9 | % | ||||||||||
Operating Income | ||||||||||||||||||||||
Net Sales | Operating Income | As a Percent of Net Sales | ||||||||||||||||||||
(In millions, except percentages) | Nine Months Ended | Nine Months Ended | Nine Months Ended | |||||||||||||||||||
27-Sep-15 | 28-Sep-14 | 27-Sep-15 | 28-Sep-14 | 27-Sep-15 | 28-Sep-14 | |||||||||||||||||
Integrated Defense Systems | $ | 4,664 | $ | 4,458 | $ | 622 | $ | 675 | 13.3 | % | 15.1 | % | ||||||||||
Intelligence, Information and Services | 4,306 | 4,372 | 500 | 364 | 11.6 | % | 8.3 | % | ||||||||||||||
Missile Systems | 4,677 | 4,590 | 609 | 588 | 13.0 | % | 12.8 | % | ||||||||||||||
Space and Airborne Systems | 4,220 | 4,412 | 563 | 629 | 13.3 | % | 14.3 | % | ||||||||||||||
Raytheon|Websense(1) | 195 | 81 | 19 | 12 | 9.7 | % | 14.8 | % | ||||||||||||||
Eliminations | (1,106 | ) | (1,230 | ) | (125 | ) | (125 | ) | ||||||||||||||
Total business segment | 16,956 | 16,683 | 2,188 | 2,143 | 12.9 | % | 12.8 | % | ||||||||||||||
Raytheon|Websense Acquisition Accounting Adjustments | (37 | ) | — | (71 | ) | (4 | ) | |||||||||||||||
FAS/CAS Adjustment | — | — | 141 | 216 | ||||||||||||||||||
Corporate | — | — | (73 | ) | (45 | ) | ||||||||||||||||
Total | $ | 16,919 | $ | 16,683 | $ | 2,185 | $ | 2,310 | 12.9 | % | 13.8 | % | ||||||||||
(1) Excludes the unfavorable impact of the Raytheon|Websense acquisition accounting adjustments and certain acquisition related costs. See Attachment F for more information on these items. | ||||||||||||||||||||||
Attachment C | |||||||||||||||||||||
Raytheon Company | |||||||||||||||||||||
Other Preliminary Information | |||||||||||||||||||||
Third Quarter 2015 | |||||||||||||||||||||
(In millions) | Funded Backlog | Total Backlog | |||||||||||||||||||
27-Sep-15 | 31-Dec-14 | 27-Sep-15 | 31-Dec-14 | ||||||||||||||||||
Integrated Defense Systems | $ | 9,603 | $ | 8,939 | $ | 11,725 | $ | 11,495 | |||||||||||||
Intelligence, Information and Services | 2,408 | 2,854 | 5,442 | 5,825 | |||||||||||||||||
Missile Systems | 7,609 | 6,992 | 9,996 | 9,269 | |||||||||||||||||
Space and Airborne Systems | 4,301 | 4,259 | 5,965 | 6,930 | |||||||||||||||||
Raytheon|Websense | 440 | 48 | 443 | 52 | |||||||||||||||||
Total | $ | 24,361 | $ | 23,092 | $ | 33,571 | $ | 33,571 | |||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||
27-Sep-15 | 28-Sep-14 | 27-Sep-15 | 28-Sep-14 | ||||||||||||||||||
Total Bookings | $ | 5,315 | $ | 5,878 | $ | 17,366 | $ | 16,943 | |||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||
27-Sep-15 | 28-Sep-14 | 27-Sep-15 | 28-Sep-14 | ||||||||||||||||||
Administrative and selling expenses | $ | 495 | $ | 419 | $ | 1,457 | $ | 1,384 | |||||||||||||
Research and development expenses | $ | 183 | $ | 121 | $ | 511 | $ | 356 | |||||||||||||
Total general and administrative expenses | $ | 678 | $ | 540 | $ | 1,968 | $ | 1,740 | |||||||||||||
Attachment D | |||||||
Raytheon Company | |||||||
Preliminary Balance Sheet Information | |||||||
Third Quarter 2015 | |||||||
(In millions) | |||||||
27-Sep-15 | 31-Dec-14 | ||||||
Assets | |||||||
Current assets | |||||||
Cash and cash equivalents | $ | 2,453 | $ | 3,222 | |||
Short-term investments | 608 | 1,497 | |||||
Contracts in process, net | 5,649 | 4,985 | |||||
Inventories | 619 | 414 | |||||
Prepaid expenses and other current assets | 199 | 174 | |||||
Total current assets | 9,528 | 10,292 | |||||
Property, plant and equipment, net | 1,934 | 1,935 | |||||
Goodwill | 14,681 | 13,061 | |||||
Other assets, net | 3,106 | 2,612 | |||||
Total assets | $ | 29,249 | $ | 27,900 | |||
Liabilities, Redeemable Noncontrolling Interest, and Equity | |||||||
Current liabilities | |||||||
Advance payments and billings in excess of costs incurred | $ | 2,215 | $ | 2,284 | |||
Accounts payable | 1,334 | 1,250 | |||||
Accrued employee compensation | 1,190 | 1,059 | |||||
Other current liabilities | 1,589 | 1,337 | |||||
Total current liabilities | 6,328 | 5,930 | |||||
Accrued retiree benefits and other long-term liabilities | 6,895 | 6,919 | |||||
Long-term debt | 5,334 | 5,330 | |||||
Redeemable noncontrolling interest | 343 | — | |||||
Equity | |||||||
Raytheon Company stockholders' equity | |||||||
Common stock | 3 | 3 | |||||
Additional paid-in capital | 617 | 1,309 | |||||
Accumulated other comprehensive loss | (7,024 | ) | (7,458 | ) | |||
Retained earnings | 16,552 | 15,671 | |||||
Total Raytheon Company stockholders' equity | 10,148 | 9,525 | |||||
Noncontrolling interests in subsidiaries | 201 | 196 | |||||
Total equity | 10,349 | 9,721 | |||||
Total liabilities, redeemable noncontrolling interest and equity | $ | 29,249 | $ | 27,900 | |||
Attachment E | |||||||||||||||
Raytheon Company | |||||||||||||||
Preliminary Cash Flow Information | |||||||||||||||
Third Quarter 2015 | |||||||||||||||
(In millions) | Three Months Ended | Nine Months Ended | |||||||||||||
27-Sep-15 | 28-Sep-14 | 27-Sep-15 | 28-Sep-14 | ||||||||||||
Net income | $ | 443 | $ | 519 | $ | 1,500 | $ | 1,672 | |||||||
(Income) loss from discontinued operations, net of tax | 1 | — | — | (59 | ) | ||||||||||
Income from continuing operations | 444 | 519 | 1,500 | 1,613 | |||||||||||
Depreciation | 76 | 76 | 225 | 225 | |||||||||||
Amortization | 54 | 35 | 128 | 102 | |||||||||||
Working capital (excluding pension and income taxes)* | 417 | (47 | ) | (659 | ) | (758 | ) | ||||||||
Other long-term liabilities | 17 | — | (26 | ) | (17 | ) | |||||||||
Pension and other postretirement benefit plans | 175 | 74 | 583 | 46 | |||||||||||
Other, net | (81 | ) | (234 | ) | (218 | ) | 24 | ||||||||
Net operating cash flow from continuing operations | $ | 1,102 | $ | 423 | $ | 1,533 | $ | 1,235 | |||||||
Supplemental Cash Flow Information | |||||||||||||||
Capital spending | $ | (96 | ) | $ | (72 | ) | $ | (239 | ) | $ | (173 | ) | |||
Internal use software spending | (11 | ) | (14 | ) | (37 | ) | (40 | ) | |||||||
Acquisitions | — | — | (1,892 | ) | — | ||||||||||
Purchases of short-term investments | (510 | ) | (819 | ) | (658 | ) | (2,190 | ) | |||||||
Sales of short-term investments | — | — | 209 | 882 | |||||||||||
Maturities of short-term investments | 562 | 237 | 1,336 | 832 | |||||||||||
Dividends | (204 | ) | (188 | ) | (595 | ) | (551 | ) | |||||||
Repurchases of common stock under stock repurchase programs | (250 | ) | (200 | ) | (750 | ) | (650 | ) | |||||||
Sale of noncontrolling interest in Raytheon|Websense | — | — | 343 | — | |||||||||||
* Working capital (excluding pension and income taxes) is a summation of changes in: contracts in process, net and advance payments and billings in excess of costs incurred, inventories, prepaid expenses and other current assets, accounts payable, accrued employee compensation, and other current liabilities from the Consolidated Statements of Cash Flows. | |||||||||||||||
Attachment F | |||||||||||||||||||
Raytheon Company | |||||||||||||||||||
Supplemental EPS Information | |||||||||||||||||||
Third Quarter 2015 | |||||||||||||||||||
(In millions, except per share amounts) | Three Months Ended | Nine Months Ended | |||||||||||||||||
27-Sep-15 | 28-Sep-14 | 27-Sep-15 | 28-Sep-14 | ||||||||||||||||
Per share impact of the FAS/CAS Adjustment (A) | $ | 0.09 | $ | 0.09 | $ | 0.30 | $ | 0.45 | |||||||||||
Per share impact of Raytheon|Websense deferred revenue adjustment (B) | (0.05 | ) | — | (0.07 | ) | — | |||||||||||||
Per share impact of Raytheon|Websense amortization of acquired intangible assets (C) | (0.04 | ) | — | (0.06 | ) | (0.01 | ) | ||||||||||||
Per share impact of Raytheon|Websense acquisition related costs (D) | — | — | (0.05 | ) | — | ||||||||||||||
(A) | FAS/CAS Adjustment | $ | 43 | $ | 42 | $ | 141 | $ | 216 | ||||||||||
Tax effect (at 35% statutory rate) | (15 | ) | (15 | ) | (49 | ) | (76 | ) | |||||||||||
After-tax impact | 28 | 27 | 92 | 140 | |||||||||||||||
Diluted shares | 304.3 | 311.4 | 306.2 | 313.6 | |||||||||||||||
Per share impact | $ | 0.09 | $ | 0.09 | $ | 0.30 | $ | 0.45 | |||||||||||
(B) | Raytheon|Websense deferred revenue adjustment (1) | $ | (27 | ) | $ | — | $ | (37 | ) | $ | — | ||||||||
Amount attributable to Raytheon Company (80.3%) | (22 | ) | — | (30 | ) | — | |||||||||||||
Tax effect (at 35% statutory rate) | 8 | — | 10 | — | |||||||||||||||
After-tax impact | (14 | ) | — | (20 | ) | — | |||||||||||||
Diluted shares | 304.3 | — | 306.2 | — | |||||||||||||||
Per share impact | $ | (0.05 | ) | $ | — | $ | (0.07 | ) | $ | — | |||||||||
(C) | Raytheon|Websense amortization of intangibles (1) | $ | (24 | ) | $ | (1 | ) | $ | (34 | ) | $ | (4 | ) | ||||||
Amount attributable to Raytheon Company (80.3%) | (19 | ) | (1 | ) | (27 | ) | (3 | ) | |||||||||||
Tax effect (at 35% statutory rate) | 7 | — | 9 | 1 | |||||||||||||||
After-tax impact | (12 | ) | (1 | ) | (18 | ) | (2 | ) | |||||||||||
Diluted shares | 304.3 | 311.4 | 306.2 | 313.6 | |||||||||||||||
Per share impact | $ | (0.04 | ) | $ | — | $ | (0.06 | ) | $ | (0.01 | ) | ||||||||
(D) | Raytheon|Websense acquisition related costs | $ | (1 | ) | $ | — | $ | (26 | ) | $ | — | ||||||||
Amount attributable to Raytheon Company (2) | (1 | ) | — | (25 | ) | — | |||||||||||||
Tax effect (at 35% statutory rate) | — | — | 9 | — | |||||||||||||||
After-tax impact | (1 | ) | — | (16 | ) | — | |||||||||||||
Diluted shares | 304.3 | — | 306.2 | — | |||||||||||||||
Per share impact | $ | — | $ | — | $ | (0.05 | ) | $ | — | ||||||||||
(1) | Raytheon|Websense deferred revenue adjustment and Raytheon|Websense amortization of intangibles represent the unfavorable impact of the acquisition accounting adjustments to record acquired deferred revenue at fair value and the amortization of acquired intangible assets, respectively, related to Raytheon|Websense, including historical Raytheon Cyber Products acquisitions. | ||||||||||||||||||
(2) | Raytheon|Websense acquisition related costs include $6 million of costs for the nine months ended September 27, 2015 for which 80.3% is attributable to Raytheon Company. The remaining $20 million for the nine months ended September 27, 2015 was 100% attributable to Raytheon Company. The $1 million of costs for the three months ended September 27, 2015 was 100% attributable to Raytheon Company. | ||||||||||||||||||