8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (date of earliest event reported): July 29, 2010

RAYTHEON COMPANY

(Exact name of registrant as specified in its charter)

Delaware	1-13699	95-1778500
(State of Incorporation)	(Commission File Number)	(IRS Employer Identification Number)

870 Winter Street, Waltham, Massachusetts	02451
(Address of Principal Executive Offices)	(Zip Code)

(781) 522-3000

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition

On July 29, 2010, Raytheon Company issued a press release announcing financial results for the fiscal quarter ended June 27, 2010. A copy of the press release is furnished with this report as Exhibit 99.1. The information in this report, including Exhibit 99.1, is furnished in accordance with SEC Release No. 33-8216 and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, regardless of any general incorporation language in such filing.

Item 9.01. Financial Statements and Exhibits

(d) Exhibits

99.1 Press Release issued by Raytheon Company dated July 29, 2010.

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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 hereunto duly authorized.

	RAYTHEON COMPANY
Date: July 29, 2010	By:	/s/ Michael J. Wood
		Michael J. Wood
		Vice President and Chief Accounting Officer

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EXHIBIT INDEX

Exhibit No.	Description
99.1	Press release issued by Raytheon Company dated July 29, 2010.

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EX-99.1

Exhibit 99.1

FOR IMMEDIATE RELEASE

Media Contact:	Investor Relations Contact:
Jon Kasle	Marc Kaplan
781-522-5110	781-522-5141

Raytheon Reports Second Quarter Results

• Net sales of $6.0 billion^{( 1)}

• Adjusted EPS of $1.36, up 11 percent; reported EPS from continuing operations was $0.56^{( 1)}

• Adjusted operating margin of 12.6 percent, up 30 basis points; reported operating margin was 5.8 percent⁽¹⁾

• Solid operating cash flow from continuing operations of $400 million

WALTHAM, Mass., (July 29, 2010) – Raytheon Company (NYSE: RTN) announced second quarter 2010 Adjusted EPS of $1.36 per diluted share, compared to $1.22 per diluted share in the second quarter 2009⁽¹⁾. Second quarter 2010 income from continuing operations attributable to Raytheon was $0.56 per diluted share compared to $1.24 per diluted share in the second quarter 2009.

Second quarter 2010 income from continuing operations attributable to Raytheon included a ($395) million before-tax unfavorable adjustment, ($274) million after-tax or ($0.71) per diluted share, due to the previously announced program termination notice received by Raytheon Systems Limited on July 22, 2010 from the UK Border Agency. The Company believes that it performed well and delivered substantial capabilities to the customer under this program, and intends to pursue vigorously the collection of the unbilled receivables and damages and defend itself against the claims for losses and previous payments. Under U.S. Generally Accepted Accounting Principles (GAAP) the Company is required to recognize, in the second quarter 2010, the potential financial impact of the termination notice.

^{(1 )} A termination notice on a UK Border Agency program reduced second quarter 2010 net sales by $316 million, income from continuing operations before taxes by $395 million and EPS by $0.71 per share. Adjusted EPS is defined as EPS from continuing operations attributable to Raytheon Company common stockholders excluding the EPS impact of the FAS/CAS pension adjustment and the UK Border Agency program termination adjustment. Adjusted Operating Margin is defined as total operating margin excluding the margin impact of the FAS/CAS pension adjustment and the adjustment for the UK Border Agency program termination. Adjusted EPS and Adjusted Operating Margin are non-GAAP financial measures. See attachment F for a reconciliation of these measures and a discussion of why the Company is presenting this information.

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Second quarter 2010 income from continuing operations attributable to Raytheon also included ($0.09) per diluted share of FAS/CAS pension expense, compared to $0.02 per diluted share of FAS/CAS pension income in the second quarter 2009.

“Raytheon’s underlying results during the quarter and execution of our strategy show continued growth for the year,” said William H. Swanson, Raytheon’s Chairman and CEO. “We continue to be well aligned with our customers’ needs and we are well positioned for the future.”

Net sales of $6.0 billion in the second quarter 2010 reflect the $316 million reduction for the UK Border Agency program termination. Net sales in the second quarter 2009 were $6.1 billion.

The Company generated operating cash flow from continuing operations of $400 million in the second quarter 2010 compared to $512 million in the second quarter 2009. Operating cash flow from continuing operations in the second quarter 2010 included $73 million in higher cash tax payments.

The Company ended the second quarter 2010 with $2.4 billion in cash and cash equivalents and $2.3 billion in total debt.

In the second quarter 2010, the Company repurchased 8.6 million shares of common stock for $475 million, as part of its previously announced share repurchase program. Year-to-date 2010, the Company repurchased 14.2 million shares of common stock for $775 million.

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Summary Financial Results

	2nd Quarter				%		Six Months				%
($ in millions, except per share data)	2010		2009		Change		2010		2009		Change
Net sales(1)	$	5,973	$	6,125	-2	%	$	12,026	$	12,009	—	%
Income from continuing operations attributable to Raytheon Company(1)	$	212	$	492	-57	%	$	665	$	941	-29	%
Adjusted Income(2)	$	522	$	485	8	%	$	1,009	$	927	9	%
EPS from continuing operations(1)	$	0.56	$	1.24	-55	%	$	1.73	$	2.35	-26	%
Adjusted EPS(2)	$	1.36	$	1.22	11	%	$	2.63	$	2.31	14	%
Operating cash flow from cont. ops.	$	400	$	512			$	657	$	923
Workdays in fiscal reporting calendar		64		64				124		125

⁽¹⁾ The unfavorable adjustment for the UK Border Agency program termination reduced net sales in the second quarter and YTD 2010 by $316 million; reduced income from continuing operations attributable to Raytheon Company in the second quarter and YTD 2010 by $395 million (before tax), $274 million (after-tax); and reduced EPS from continuing operations in the second quarter and YTD 2010 by $0.71 and $0.72 per diluted share, respectively.

⁽²⁾ Adjusted Income is defined as income from continuing operations attributable to Raytheon Company common stockholders excluding the after-tax impact of the FAS/CAS pension adjustment and the UK Border Agency program termination adjustment. Adjusted EPS is defined as EPS from continuing operations attributable to Raytheon Company common stockholders excluding the EPS impact of the FAS/CAS pension adjustment and the UK Border Agency program termination adjustment. Adjusted EPS and Adjusted Income are non-GAAP financial measures. See attachment F for a reconciliation of these measures and a discussion of why the Company is presenting this information.

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Bookings and Backlog

Bookings

	2nd Quarter				Six Months
($ in millions)	2010		2009		2010		2009
Bookings	$	5,901	$	7,647	$	12,427	$	12,856

Backlog

	Period Ending
($ in millions)	06/27/10		12/31/09
Backlog(1)	$	35,980	$	36,877
Funded Backlog(1)	$	22,461	$	23,479

⁽¹⁾ Backlog and funded backlog for the period ending 06/27/10 was reduced by a net $556 million for the UK Border Agency program termination.

Year-to-date 2010 bookings were $12.4 billion, resulting in a book-to-bill ratio slightly greater than 1.

Outlook

2010 Financial Outlook

			2010 Outlook
	2009 Actual		Current	Prior (4/22/10)
Net Sales ($B)		24.9	25.6 -26.1*	25.9 - 26.4
FAS/CAS Pension Inc./(Exp.) ($M)		27	(220)	(220)
Interest Expense, Net ($M)		(109)	(95) -(110)	(95) - (110)
Diluted Shares (M)		395.7	377 - 382	377 - 382
Effective Tax Rate		32.5%	~31.5%	~31.5%
EPS from Continuing Operations	$	4.89	$4.00 - $4.15*	$4.75 - $4.90
Adjusted EPS(1)	$	4.85	$5.13 -$5.28	$5.13 - $5.28
Operating Cash Flow from Cont. Ops. ($B)		2.7	2.0 - 2.2	2.0 - 2.2
ROIC (%)(1)		12.2	12.2 - 12.6	12.2 - 12.6

* Denotes change from prior guidance.

⁽¹⁾ Adjusted EPS is defined as EPS from continuing operations attributable to Raytheon Company common stockholders excluding the EPS impact of the FAS/CAS pension adjustment and the UK Border Agency program termination adjustment. Adjusted EPS and ROIC are non-GAAP financial measures. See attachment F for a reconciliation of Adjusted EPS to EPS from continuing operations and attachment G for a calculation of ROIC and discussions of why the Company is presenting this information.

The Company updated its full-year 2010 guidance to reflect the unfavorable impact of the UK Border Agency program termination. Charts containing additional information on the Company’s 2010 financial outlook are available on the Company’s website at www.raytheon.com/ir.

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Segment Results

Integrated Defense Systems

	2nd Quarter						%		Six Months						%
($ in millions)	2010			2009			Change		2010			2009			Change
Net Sales	$	1,352		$	1,335		1	%	$	2,688		$	2,597		4	%
Operating Income	$	221		$	205		8	%	$	431		$	393		10	%
Operating Margin		16.3	%		15.4	%				16.0	%		15.1	%

Integrated Defense Systems (IDS) had second quarter 2010 net sales of $1,352 million compared to $1,335 million in the second quarter 2009. IDS recorded $221 million of operating income compared to $205 million in the second quarter 2009. The increase in operating income was primarily due to international Patriot programs.

During the quarter, IDS booked $317 million to provide advanced Patriot air and missile defense capability for an international customer.

Intelligence and Information Systems

	2nd Quarter						%		Six Months						%
($ in millions)	2010			2009			Change		2010			2009			Change
Net Sales	$	472		$	812		-42	%	$	1,202		$	1,596		-25	%
Operating Income (Loss)	$	(329	)	$	66		NM		$	(279	)	$	127		NM
Operating Margin		NM			8.1	%				NM			8.0	%

NM = Not Meaningful

Intelligence and Information Systems (IIS) had second quarter 2010 net sales of $472 million compared to $812 million in the second quarter 2009. IIS recorded $329 million of operating loss in the second quarter 2010 and $66 million of operating income in the second quarter 2009. The impact of the UK Border Agency program termination reduced IIS’ second quarter 2010 net sales and operating income by $316 million and $395 million, respectively.

During the quarter, IIS booked $80 million on the Earth Observing System Data and Information System (EOSDIS) contract for NASA. IIS also booked $371 million on a number of classified contracts.

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Missile Systems

	2nd Quarter						%		Six Months						%
($ in millions)	2010			2009			Change		2010			2009			Change
Net Sales	$	1,415		$	1,384		2	%	$	2,776		$	2,752		1	%
Operating Income	$	164		$	147		12	%	$	322		$	305		6	%
Operating Margin		11.6	%		10.6	%				11.6	%		11.1	%

Missile Systems (MS) had second quarter 2010 net sales of $1,415 million compared to $1,384 million in the second quarter 2009. MS recorded $164 million of operating income compared to $147 million in the second quarter 2009. The increase in operating income was primarily due to improved program performance.

During the quarter, MS booked $234 million for Standard Missile-3 (SM-3) for the Missile Defense Agency, $223 million for Phalanx Weapon Systems for the U.S. Navy, U.S. Army and international customers, $150 million for Miniature Air Launched Decoys (MALD) for the U.S Air Force, $123 million for Evolved Sea Sparrow Missiles (ESSM) for the U.S. Navy and international customers, $84 million for Standard Missile-2 (SM-2) for the U.S. Navy and an international customer and $81 million for AIM-9X short range air-to-air missiles for the U.S. Navy and international customers.

Network Centric Systems

	2nd Quarter						%		Six Months						%
($ in millions)	2010			2009			Change		2010			2009			Change
Net Sales	$	1,205		$	1,197		1	%	$	2,381		$	2,351		1	%
Operating Income	$	166		$	170		-2	%	$	331		$	333		-1	%
Operating Margin		13.8	%		14.2	%				13.9	%		14.2	%

Network Centric Systems (NCS) had second quarter 2010 net sales of $1,205 million compared to $1,197 million in the second quarter 2009. NCS recorded $166 million of operating income compared to $170 million in the second quarter 2009.

During the quarter, NCS booked $100 million on a command and control program for an international customer.

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Space and Airborne Systems

	2nd Quarter						%		Six Months						%
($ in millions)	2010			2009			Change		2010			2009			Change
Net Sales	$	1,197		$	1,136		5	%	$	2,292		$	2,182		5	%
Operating Income	$	171		$	175		-2	%	$	330		$	314		5	%
Operating Margin		14.3	%		15.4	%				14.4	%		14.4	%

Space and Airborne Systems (SAS) had second quarter 2010 net sales of $1,197 million, up 5 percent compared to $1,136 million in the second quarter 2009, primarily due to growth on classified business. SAS recorded $171 million of operating income compared to $175 million in the second quarter 2009. The change in operating income was primarily due to a favorable contractual settlement in the second quarter 2009.

During the quarter, SAS booked $160 million on two international AESA tactical radar programs. SAS also booked $563 million on a number of classified contracts, including $355 million on a major classified program.

Technical Services

	2nd Quarter						%		Six Months						%
($ in millions)	2010			2009			Change		2010			2009			Change
Net Sales	$	834		$	780		7	%	$	1,635		$	1,476		11	%
Operating Income	$	73		$	53		38	%	$	140		$	97		44	%
Operating Margin		8.8	%		6.8	%				8.6	%		6.6	%

Technical Services (TS) had second quarter 2010 net sales of $834 million, up 7 percent compared to $780 million in the second quarter 2009, primarily due to continued growth in domestic and foreign training programs supporting the U.S. Army’s Warfighter Field Operations Customer Support (FOCUS) activities. TS recorded operating income of $73 million compared to $53 million in the second quarter 2009. The increase in operating income was primarily due to improved program performance and higher volume.

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During the quarter, TS booked $399 million on domestic training programs and $136 million on foreign training programs in support of the Warfighter FOCUS activities. TS also booked $95 million to provide operational and logistics support to the National Science Foundation (NSF) Office of Polar Programs.

Raytheon Company (NYSE: RTN), with 2009 sales of $25 billion, is a technology and innovation leader specializing in defense, homeland security and other government markets throughout the world. With a history of innovation spanning 88 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 a broad range of mission support services. With headquarters in Waltham, Mass., Raytheon employs 75,000 people worldwide.

Conference Call on the Second Quarter 2010 Financial Results

Raytheon’s financial results conference call will be held on Thursday, July 29, 2010 at 9 a.m. ET. Participants will include William H. Swanson, Chairman and CEO; David C. Wajsgras, senior vice president and CFO; and other Company executives.

The dial-in number for the conference call will be (866) 543-6405 in the U.S. or (617) 213-8897 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.

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Disclosure Regarding Forward-looking Statements

This release and the attachments contain forward-looking statements, including information regarding the Company’s 2010 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, 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 ability to comply with extensive governmental regulation, including import and export policies, the Foreign Corrupt Practices Act, the International Traffic in Arms Regulations, 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 Company’s assumptions; the risk of cost overruns, particularly for the Company’s fixed-price contracts; dependence on component availability, subcontractor 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 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

Second Quarter 2010

(In millions, except per share amounts)	Three Months Ended						Six Months Ended
	27-Jun-10			28-Jun-09			27-Jun-10			28-Jun-09
Net sales	$	5,973		$	6,125		$	12,026		$	12,009
Operating expenses
Cost of sales		5,038			4,839			9,822			9,536
Administrative and selling expenses		414			370			822			734
Research and development expenses		176			151			328			262
Total operating expenses		5,628			5,360			10,972			10,532
Operating income		345			765			1,054			1,477
Interest expense		33			31			65			63
Interest income		(4	)		(3	)		(7	)		(7	)
Other (income) expense		6			(13	)		5			(8	)
Non-operating (income) expense		35			15			63			48
Income from continuing operations before taxes		310			750			991			1,429
Federal and foreign income taxes		91			246			311			468
Income from continuing operations		219			504			680			961
Income (loss) from discontinued operations, net of tax		(4	)		(3	)		(12	)		—
Net income		215			501			668			961
Less: Net income (loss) attributable to noncontrolling interests in subsidiaries		7			12			15			20
Net income attributable to Raytheon Company	$	208		$	489		$	653		$	941
Basic earnings (loss) per share attributable to Raytheon Company common stockholders:
Income from continuing operations	$	0.56		$	1.25		$	1.76		$	2.38
Income (loss) from discontinued operations, net of tax		(0.01	)		(0.01	)		(0.03	)		—
Net income		0.55			1.24			1.73			2.38
Diluted earnings (loss) per share attributable to Raytheon Company common stockholders:
Income from continuing operations	$	0.56		$	1.24		$	1.73		$	2.35
Income (loss) from discontinued operations, net of tax		(0.01	)		(0.01	)		(0.03	)		—
Net income		0.55			1.23			1.70			2.35
Amounts attributable to Raytheon Company common stockholders:
Income from continuing operations	$	212		$	492		$	665		$	941
Income (loss) from discontinued operations, net of tax		(4	)		(3	)		(12	)		—
Net income	$	208		$	489		$	653		$	941
Average shares outstanding
Basic		378.5			392.5			378.1			395.7
Diluted		383.1			397.3			383.7			400.6

Attachment B

Raytheon Company

Preliminary Segment Information

Second Quarter 2010

(In millions, except percentages)	Net Sales Three Months Ended						Operating Income Three Months Ended						Operating Income As a Percent of Net Sales Three Months Ended
	27-Jun-10			28-Jun-09			27-Jun-10			28-Jun-09			27-Jun-10		28-Jun-09
Integrated Defense Systems	$	1,352		$	1,335		$	221		$	205		16.3	%	15.4	%
Intelligence and Information Systems		472			812			(329	)		66		-69.7	%	8.1	%
Missile Systems		1,415			1,384			164			147		11.6	%	10.6	%
Network Centric Systems		1,205			1,197			166			170		13.8	%	14.2	%
Space and Airborne Systems		1,197			1,136			171			175		14.3	%	15.4	%
Technical Services		834			780			73			53		8.8	%	6.8	%
FAS/CAS Pension Adjustment		—			—			(55	)		11
Corporate and Eliminations		(502	)		(519	)		(66	)		(62	)
Total	$	5,973		$	6,125		$	345		$	765		5.8	%	12.5	%
(In millions, except percentages)	Net Sales Six Months  Ended						Operating Income Six Months Ended						Operating Income As a Percent of Net Sales Six Months Ended
	27-Jun-10			28-Jun-09			27-Jun-10			28-Jun-09			27-Jun-10		28-Jun-09
Integrated Defense Systems	$	2,688		$	2,597		$	431		$	393		16.0	%	15.1	%
Intelligence and Information Systems		1,202			1,596			(279	)		127		-23.2	%	8.0	%
Missile Systems		2,776			2,752			322			305		11.6	%	11.1	%
Network Centric Systems		2,381			2,351			331			333		13.9	%	14.2	%
Space and Airborne Systems		2,292			2,182			330			314		14.4	%	14.4	%
Technical Services		1,635			1,476			140			97		8.6	%	6.6	%
FAS/CAS Pension Adjustment		—			—			(108	)		22
Corporate and Eliminations		(948	)		(945	)		(113	)		(114	)
Total	$	12,026		$	12,009		$	1,054		$	1,477		8.8	%	12.3	%

Attachment C

Raytheon Company

Other Preliminary Information

Second Quarter 2010

(In millions)	Funded Backlog				Total Backlog
	27-Jun-10		31-Dec-09		27-Jun-10		31-Dec-09
Integrated Defense Systems	$	5,637	$	5,595	$	9,463	$	10,665
Intelligence and Information Systems *		1,013		1,588		4,619		4,360
Missile Systems		6,296		6,454		7,838		7,657
Network Centric Systems		4,221		4,389		5,143		5,501
Space and Airborne Systems		3,215		3,402		5,930		5,921
Technical Services		2,079		2,051		2,987		2,773
Total	$	22,461	$	23,479	$	35,980	$	36,877

* Backlog and funded backlog for the period ending June 27, 2010 was reduced by a net $546 million for the UK Border Agency program termination.

	Bookings Three Months Ended
	27-Jun-10		28-Jun-09
Total Bookings	$	5,901	$	7,647

Attachment D

Raytheon Company

Preliminary Balance Sheet Information

Second Quarter 2010

(In millions)
	27-Jun-10			31-Dec-09
Assets
Cash and cash equivalents	$	2,385		$	2,642
Accounts receivable, net		131			120
Contracts in process		4,461			4,373
Inventories		330			344
Deferred taxes		301			273
Prepaid expenses and other current assets		112			116
Total current assets		7,720			7,868
Property, plant and equipment, net		1,953			2,001
Deferred taxes		326			436
Prepaid retiree benefits		130			111
Goodwill		11,921			11,922
Other assets, net		1,231			1,269
Total assets	$	23,281		$	23,607
Liabilities and Equity
Current liabilities
Advance payments and billings in excess of costs incurred	$	2,159		$	2,224
Accounts payable		1,330			1,397
Accrued employee compensation		972			868
Other accrued expenses		1,214			1,034
Total current liabilities		5,675			5,523
Accrued retiree benefits and other long-term liabilities		5,261			5,793
Deferred taxes		23			23
Long-term debt		2,327			2,329
Equity
Raytheon Company stockholders’ equity
Common stock		4			4
Additional paid-in capital		11,332			10,991
Accumulated other comprehensive loss		(4,712	)		(4,824	)
Treasury stock, at cost		(6,222	)		(5,446	)
Retained earnings		9,473			9,102
Total Raytheon Company stockholders’ equity		9,875			9,827
Noncontrolling interests in subsidiaries		120			112
Total equity		9,995			9,939
Total liabilities and equity	$	23,281		$	23,607

Attachment E

Raytheon Company

Preliminary Cash Flow Information

Second Quarter 2010

(In millions)	Three Months Ended						Six Months Ended
	27-Jun-10			28-Jun-09			27-Jun-10			28-Jun-09
Net income (loss)	$	215		$	501		$	668		$	961
(Income) loss from discontinued operations, net of tax		4			3			12			—
Income (loss) from continuing operations		219			504			680			961
Depreciation		75			73			149			144
Amortization		28			24			57			50
Working capital (excluding pension and taxes)*		651			313			(26	)		(625	)
Discontinued operations		—			(3	)		2			(9	)
Net activity in financing receivables		6			6			22			15
Other		(579	)		(408	)		(225	)		378
Net operating cash flow		400			509			659			914
Capital spending		(64	)		(48	)		(109	)		(81	)
Internal use software spending		(17	)		(21	)		(31	)		(34	)
Acquisitions		—			—			(12	)		—
Dividends		(143	)		(122	)		(260	)		(234	)
Repurchases of common stock		(475	)		(300	)		(775	)		(600	)
Warrants exercised		87			—			250			—
Other		(16	)		(29	)		21			(25	)
Total cash flow	$	(228	)	$	(11	)	$	(257	)	$	(60	)

* Working capital (excluding pension and taxes) is a summation of changes in: accounts receivable, net, contracts in process and advance payments and billings in excess of costs incurred, inventories, prepaid expenses and other current assets, accounts payable, accrued employee compensation, and other accrued expenses from the Statements of Cash Flows.

Attachment F

Raytheon Company

Non-GAAP Financial Measures - Adjusted Measures

Second Quarter 2010

Adjusted EPS Non-GAAP Reconciliation

(In millions, except per share amounts)													2010  Current Guidance						2010 Prior Guidance
	Three Months Ended						Six Months Ended						Low end			High end			Low end			High end
	2010			2009			2010			2009			of range			of range			of range			of range
Diluted earnings per share from continuing operations attributable to Raytheon Company common stockholders	$	0.56		$	1.24		$	1.73		$	2.35		$	4.00		$	4.15		$	4.75		$	4.90
Less:  Per share impact of the FAS/CAS Pension Adjustment (A)		(0.09	)		0.02			(0.18	)		0.04			(0.38	)		(0.38	)		(0.38	)		(0.38	)
Less:  Per share impact of United Kingdom (UK) Border Agency program termination (B)		(0.71	)		—			(0.72	)		—			(0.75	)		(0.75	)		—			—
Adjusted EPS (1)	$	1.36		$	1.22		$	2.63		$	2.31		$	5.13		$	5.28		$	5.13		$	5.28
(A) FAS/CAS Pension Adjustment	$	(55	)	$	11		$	(108	)	$	22		$	(220	)	$	(220	)	$	(220	)	$	(220	)
Tax effect (at 35% federal statutory rate)		19			(4	)		38			(8	)		77			77			77			77
After-tax impact		(36	)		7			(70	)		14			(143	)		(143	)		(143	)		(143	)
Diluted Shares		383.1			397.3			383.7			400.6			382.0			377.0			382.0			377.0
Per share impact (2)	$	(0.09	)	$	0.02		$	(0.18	)	$	0.04		$	(0.38	)	$	(0.38	)	$	(0.38	)	$	(0.38	)
(B) UK Border Agency program termination	$	(395	)	$	—		$	(395	)	$	—		$	(395	)	$	(395	)	$	—		$	—
Tax effect (actual at 30.5% blended global tax rate and guidance at 28% UK statutory rate)		121			—			121			—			111			111			—			—
After-tax adjustment		(274	)		—			(274	)		—			(284	)		(284	)		—			—
Diluted Shares		383.1			397.3			383.7			400.6			382.0			377.0			382.0			377.0
Per share impact (2)	$	(0.71	)	$	—		$	(0.72	)	$	—		$	(0.75	)	$	(0.75	)	$	—		$	—

Adjusted Income from Continuing Operations attributable to Raytheon Company common stockholders Non-GAAP Reconciliation

	Three Months Ended					Six Months Ended
	2010		2009			2010		2009
Income from Continuing Operations attributable to Raytheon Company common stockholders	$	212	$	492		$	665	$	941
FAS/CAS Pension Adjustment (Tax effected at 35% federal statutory rate)		36		(7	)		70		(14	)
UK Border Agency program termination (Tax effected at 30.5% blended global tax rate)		274		—			274		—
Adjusted Income (1)	$	522	$	485		$	1,009	$	927

Adjusted operating margin Non-GAAP Reconciliation

(In millions, except per share amounts)									2010  Current Guidance
	Three Months Ended				Six Months Ended				Low end		High end
	2010		2009		2010		2009		of range		of range
Operating margin	5.8	%	12.5	%	8.8	%	12.3	%	9.4	%	9.6	%
Less: Impact of the FAS/CAS Pension Adjustment	(0.9	)%	0.2	%	(0.9	)%	0.2	%	(0.9	)%	(0.9	)%
Less: Impact of UK Border Agency program termination	(5.9	)%	0.0	%	(2.9	)%	0.0	%	(1.5	)%	(1.5	)%
Adjusted operating margin (1)	12.6	%	12.3	%	12.6	%	12.1	%	11.8	%	12.0	%

(1) These amounts are not measures of financial performance under U.S. generally accepted accounting principles (GAAP). They should be considered supplemental to and not a substitute for financial performance in accordance with GAAP and may not be defined and calculated by other companies in the same manner. We are providing these measures because management uses them for the purposes of evaluating and forecasting the Company’s financial performance and we believe it allows investors to benefit from being able to assess our operating performance in the context of how our principal customer, the U.S. Government, allows us to recover pension costs and to better compare our operating performance to others in the industry on that same basis and excluding significant unusual items.

Adjusted EPS is defined as diluted EPS from continuing operations attributable to Raytheon Company common stockholders excluding the EPS impact of the FAS/CAS pension adjustment and the UK Border Agency program termination. Adjusted operating margin is defined as total operating margin excluding the margin impact of the FAS/CAS pension adjustment and the UK Border Agency program termination. Adjusted Income from continuing operations attributable to Raytheon Company common stockholders is defined as income from continuing operations attributable to Raytheon Company common stockholders excluding the after-tax impact of the FAS/CAS pension adjustment and the after-tax impact of the UK Border Agency program termination.

(2) Amounts may not recalculate directly do to rounding.

Attachment G

Raytheon Company

Preliminary Return on Invested Capital Non-GAAP Financial Measure

Second Quarter 2010

The Company defines Return on Invested Capital (ROIC) as income from continuing operations excluding the after-tax effect of the FAS/CAS pension adjustment and the after-tax effect of the UK Border Agency program termination adjustment plus after-tax net interest expense plus one-third of operating lease expense after-tax (estimate of interest portion of operating lease expense) divided by average invested capital after capitalizing operating leases (operating lease expense times a multiplier of 8), adding financial guarantees less net investment in Discontinued Operations, and adding back the impact of the accounting standard for employers’ accounting for defined benefit pension and other postretirement plans. ROIC is not a measure of financial performance under generally accepted accounting principles (GAAP) and may not be defined and calculated by other companies in the same manner. ROIC should be considered supplemental to and not a substitute for financial information prepared in accordance with GAAP. The Company uses ROIC as a measure of efficiency and effectiveness of its use of capital and as an element of management compensation.

Return on Invested Capital

(In millions, except percentages)				2010 Current Guidance
	2009			Low end of range			High end of range
Income from continuing operations	$	1,977
FAS/CAS Pension Adjustment, after-tax *		(18	)
UK Border Agency program termination, after-tax **		—
Net interest expense, after-tax *		71			Combined			Combined
Lease expense, after-tax *		66
Return	$	2,096		$	2,155		$	2,220
Net debt ***		132
Equity less investment in discontinued operations		9,560
Lease expense x 8, plus financial guarantees		2,815			Combined			Combined
Minimum pension liability		5,007
Invested capital from continuing operations ****		17,250		$	17,700		$	17,500
ROIC		12.2	%		12.2	%		12.6	%

* Federal statutory tax rate of 35%

** U.K. statutory tax rate of 28%

*** Net debt is defined as total debt less cash and cash equivalents and is calculated using a 2 point average

**** Calculated using a 2 point average