10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

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

For the quarter ended June 30, 2011

Or

o 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 1-892

GOODRICH CORPORATION

(Exact name of registrant as specified in its charter)

New York (State of incorporation)	34-0252680 (I.R.S. Employer Identification No.)
Four Coliseum Centre 2730 West Tyvola Road Charlotte, North Carolina (Address of principal executive offices)	28217 (Zip Code)

Registrant’s telephone number, including area code: (704) 423-7000

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 (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes þ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer þ Accelerated filer o Non-accelerated filer o (Do not check if a smaller reporting company) Smaller reporting company o

Indicate by check mark whether the registrant is a shell company filer (as defined in Rule 12b-2 of the Exchange Act). Yes o No þ

At June 30, 2011, there were 125,005,231 shares of common stock outstanding (excluding 14,000,000 shares held by wholly owned subsidiary). There is only one class of common stock.

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION
Item 1. Financial Statements	2
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	30
Item 3. Quantitative and Qualitative Disclosures About Market Risk	67
Item 4. Controls and Procedures	67
PART II. OTHER INFORMATION
Item 1. Legal Proceedings	68
Item 1A. Risk Factors	68
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	69
Item 6. Exhibits	70
SIGNATURE	71
EXHIBIT INDEX	72
EX-15
EX-31.1
EX-31.2
EX-32
EX-101 INSTANCE DOCUMENT
EX-101 SCHEMA DOCUMENT
EX-101 CALCULATION LINKBASE DOCUMENT
EX-101 LABELS LINKBASE DOCUMENT
EX-101 PRESENTATION LINKBASE DOCUMENT
EX-101 DEFINITION LINKBASE DOCUMENT

1

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Shareholders and Board of Directors of Goodrich Corporation

We have reviewed the condensed consolidated balance sheet of Goodrich Corporation as of June 30, 2011, and the related condensed consolidated statements of income for the three-month and six-month periods ended June 30, 2011 and 2010, and the condensed consolidated statements of cash flows for the six-month periods ended June 30, 2011 and 2010. These financial statements are the responsibility of the Company’s management.

We conducted our review in accordance with the standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the Public Company Accounting Oversight Board, 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 condensed consolidated financial statements referred to above for them to be in conformity with U.S. generally accepted accounting principles.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet of Goodrich Corporation as of December 31, 2010, and the related consolidated statements of income, shareholders’ equity, and cash flows for the year then ended, not presented herein; and in our report dated February 15, 2011, 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, 2010, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

/s/ Ernst & Young LLP  

Charlotte, North Carolina
July 22, 2011

2

CONDENSED CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2011			2010			2011			2010
	(Dollars in millions, except per share amounts)
Sales	$	2,001.4		$	1,717.5		$	3,897.3		$	3,412.7
Operating costs and expenses:
Cost of sales		1,384.2			1,172.9			2,694.7			2,377.2
Selling and administrative costs		314.3			269.3			599.4			539.2
		1,698.5			1,442.2			3,294.1			2,916.4
Operating Income		302.9			275.3			603.2			496.3
Interest expense		(34.5	)		(33.6	)		(69.1	)		(67.1	)
Interest income		0.3			0.3			0.6			0.4
Other income (expense) — net		(4.2	)		(4.4	)		(10.0	)		(10.8	)
Income from continuing operations before income taxes		264.5			237.6			524.7			418.8
Income tax expense		(86.2	)		(76.3	)		(149.8	)		(144.9	)
Income From Continuing Operations		178.3			161.3			374.9			273.9
Income from discontinued operations — net of income taxes		—			0.1			—			1.3
Consolidated Net Income		178.3			161.4			374.9			275.2
Net income attributable to noncontrolling interests		(1.7	)		(2.4	)		(3.5	)		(5.0	)
Net Income Attributable to Goodrich	$	176.6		$	159.0		$	371.4		$	270.2
Amounts Attributable to Goodrich:
Income from continuing operations	$	176.6		$	158.9		$	371.4		$	268.9
Income from discontinued operations — net of income taxes		—			0.1			—			1.3
Net Income Attributable to Goodrich	$	176.6		$	159.0		$	371.4		$	270.2
Earnings per common share attributable to Goodrich:
Basic Earnings Per Share
Continuing operations	$	1.39		$	1.25		$	2.93		$	2.12
Discontinued operations		—			—			—			0.01
Net Income Attributable to Goodrich	$	1.39		$	1.25		$	2.93		$	2.13
Diluted Earnings Per Share
Continuing operations	$	1.38		$	1.24		$	2.90		$	2.10
Discontinued operations		—			—			—			0.01
Net Income Attributable to Goodrich	$	1.38		$	1.24		$	2.90		$	2.11
Dividends Declared Per Common Share	$	0.29		$	0.27		$	0.58		$	0.54

See Notes to Condensed Consolidated Financial Statements (Unaudited)

3

CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED)

	June 30,			December 31,
	2011			2010
	(Dollars in millions,
	except share amounts)
Current Assets
Cash and cash equivalents	$	518.0		$	798.9
Accounts and notes receivable, less allowances for doubtful receivables ($18.2 at June 30, 2011 and $16.8 at December 31, 2010)		1,468.5			1,102.7
Inventories — net		2,687.3			2,449.4
Deferred income taxes		168.3			158.3
Prepaid expenses and other assets		88.3			68.1
Income taxes receivable		3.0			93.7
Total Current Assets		4,933.4			4,671.1
Property, plant and equipment, less accumulated depreciation ($1,939.2 at June 30, 2011 and $1,843.9 at December 31, 2010)		1,547.4			1,521.5
Goodwill		1,993.7			1,762.2
Identifiable intangible assets — net		976.4			675.8
Deferred income taxes		17.3			16.4
Other assets		788.1			624.6
Total Assets	$	10,256.3		$	9,271.6
Current Liabilities
Short-term debt	$	36.1		$	4.1
Accounts payable		710.6			514.0
Accrued expenses		1,101.2			1,041.8
Income taxes payable		69.5			2.9
Deferred income taxes		31.0			28.1
Current maturities of long-term debt and capital lease obligations		1.4			1.5
Total Current Liabilities		1,949.8			1,592.4
Long-term debt and capital lease obligations		2,384.6			2,352.8
Pension obligations		516.6			556.7
Postretirement benefits other than pensions		276.4			296.9
Long-term income taxes payable		135.9			150.7
Deferred income taxes		597.8			431.2
Other non-current liabilities		546.9			503.1
Shareholders’ Equity
Common stock — $5 par value
Authorized 200,000,000 shares; issued 149,418,717 shares at June 30, 2011 and 148,213,331 shares at December 31, 2010 (excluding 14,000,000 shares held by a wholly owned subsidiary)		747.1			741.1
Additional paid-in capital		1,822.3			1,751.2
Income retained in the business		2,824.9			2,527.2
Accumulated other comprehensive income (loss)		(485.0	)		(676.1	)
Common stock held in treasury, at cost (24,413,486 shares at June 30, 2011 and 23,259,865 shares at December 31, 2010)		(1,097.3	)		(996.5	)
Total Shareholders’ Equity		3,812.0			3,346.9
Noncontrolling interests		36.3			40.9
Total Equity		3,848.3			3,387.8
Total Liabilities And Equity	$	10,256.3		$	9,271.6

See Notes to Condensed Consolidated Financial Statements (Unaudited)

4

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)

	Six Months Ended
	June 30,
	2011			2010
	(Dollars in millions)
Operating Activities
Consolidated net income	$	374.9		$	275.2
Adjustments to reconcile consolidated net income to net cash provided by operating activities:
(Income) loss from discontinued operations		—			(1.3	)
Restructuring and consolidation:
Expenses		20.5			—
Payments		(3.9	)		(4.2	)
Pension and postretirement benefits:
Expenses		49.2			90.1
Contributions and benefit payments		(88.8	)		(129.8	)
Depreciation and amortization		149.9			134.9
Excess tax benefits related to share-based payment arrangements		(10.4	)		(12.9	)
Share-based compensation expense		46.5			33.2
Deferred income taxes		(2.0	)		7.8
Change in assets and liabilities, net of effects of acquisitions and divestitures:
Receivables		(291.4	)		(90.1	)
Inventories, net of pre-production and excess-over-average		(78.9	)		0.4
Pre-production and excess-over-average inventories		(67.9	)		(130.5	)
Other current assets		7.6			2.4
Accounts payable		112.0			44.0
Accrued expenses		0.7			12.8
Income taxes payable/receivable		140.5			66.4
Other assets and liabilities		(20.9	)		(45.4	)
Net Cash Provided By Operating Activities		337.6			253.0
Investing Activities
Purchases of property, plant and equipment		(98.0	)		(51.6	)
Proceeds from sale of property, plant and equipment		0.2			0.1
Net payments made for acquisitions, net of cash acquired		(448.8	)		(61.6	)
Investments in and advances to equity investees		(1.0	)		(1.0	)
Net Cash Used In Investing Activities		(547.6	)		(114.1	)
Financing Activities
Increase (decrease) in short-term debt, net		(5.3	)		17.8
Proceeds (repayments) of long-term debt and capital lease obligations		31.1			(0.1	)
Proceeds from issuance of common stock		32.6			53.0
Purchases of treasury stock		(100.9	)		(72.6	)
Dividends paid		(37.4	)		(68.3	)
Excess tax benefits related to share-based payment arrangements		10.4			12.9
Distributions to noncontrolling interests		(8.1	)		(11.3	)
Net Cash Provided By (Used In) Financing Activities		(77.6	)		(68.6	)
Discontinued Operations
Net cash provided by (used in) operating activities		(0.2	)		(0.4	)
Net cash provided by (used in) investing activities		—			—
Net cash provided by (used in) financing activities		—			—
Net cash provided by (used in) discontinued operations		(0.2	)		(0.4	)
Effect of exchange rate changes on cash and cash equivalents		6.9			(14.5	)
Net increase (decrease) in cash and cash equivalents		(280.9	)		55.4
Cash and cash equivalents at beginning of period		798.9			811.0
Cash and cash equivalents at end of period	$	518.0		$	866.4

See Notes to Condensed Consolidated Financial Statements (Unaudited)

5

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Note 1. Basis of Interim Financial Statements

The accompanying unaudited condensed consolidated financial statements of Goodrich Corporation and its subsidiaries have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and notes required by accounting principles generally accepted in the United States for complete financial statements. Unless indicated otherwise or the context requires, the terms “we,” “our,” “us,” “Goodrich” or “Company” refer to Goodrich Corporation and its subsidiaries. The Company believes that all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Certain amounts in prior year financial statements have been reclassified to conform to the current year presentation. Operating results for the three and six months ended June 30, 2011 are not necessarily indicative of the results that may be achieved for the twelve months ending December 31, 2011. Unless otherwise noted, disclosures pertain to the Company’s continuing operations. For further information, refer to the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2010.

Use of Estimates. The preparation of financial statements requires management to make estimates and assumptions that affect amounts recognized. Estimates and assumptions are reviewed and updated regularly as new information becomes available. During the three and six months ended June 30, 2011 and 2010, the Company changed its estimates of revenues and costs on certain long-term contracts primarily in its aerostructures and aircraft wheels and brakes businesses. The changes in estimates increased income from continuing operations before income taxes during the three months ended June 30, 2011 and 2010 by $20.6 million and $32.8 million ($13 million and $20.6 million after tax, or $0.10 and $0.16 per diluted share, respectively). The changes in estimates increased income from continuing operations before income taxes during the six months ended June 30, 2011 and 2010 by $41.3 million and $48.8 million, respectively ($26.2 million and $30.6 million after tax or $0.20 and $0.24 per diluted share, respectively). These changes were primarily related to favorable cost and operational performance, changes in volume expectations and sales pricing improvements and finalization of contract terms on current and/or follow-on contracts.

Accrued Expenses. Accrued expenses consisted of the following:

	June 30,		December 31,
	2011		2010
	(Dollars in millions)
Deferred revenue	$	355.5	$	274.9
Wages, vacations, pensions and other employment costs		285.5		313.2
Warranties		98.7		90.0
Postretirement benefits other than pensions		28.2		29.7
Accrued taxes		40.6		31.1
Foreign currency hedges		8.4		22.5
Other		284.3		280.4
Total	$	1,101.2	$	1,041.8

6

Note 2. New Accounting Standards Not Yet Adopted

In May 2011, accounting guidance was issued that will be included in Accounting Standards Codification (ASC) Topic 820, “Fair Value Measurement”. This guidance amends the requirements for measuring fair value and disclosing information about fair value measurements and is effective for the Company on January 1, 2012. Upon adoption, the Company does not expect this standard to have a material impact on its financial condition or results of operations.

In June 2011, accounting guidance was issued that will be included in ASC Topic 220, “Comprehensive Income”. This guidance eliminates the option to report other comprehensive income and its components in the statement of changes in equity. Companies can elect to present items of net income and other comprehensive income in one continuous statement or in two separate, but consecutive, statements. The Company is currently evaluating which method it will utilize to present items of net income and other comprehensive income. This presentation guidance is effective for the Company on January 1, 2012.

Note 3. Business Segment Information

The Company’s business segments are as follows:

• The Actuation and Landing Systems segment provides systems, components and related services pertaining to aircraft taxi, take-off, flight control, landing and stopping, and engine components, including fuel delivery systems and rotating assemblies.

• The Nacelles and Interior Systems segment produces products and provides maintenance, repair and overhaul services associated with aircraft engines, including thrust reversers, cowlings, nozzles and their components, and aircraft interior products, including slides, seats, cargo and lighting systems.

• The Electronic Systems segment produces a wide array of systems and components that provide flight performance measurements, flight management, fuel controls, electrical systems, control and safety data, reconnaissance and surveillance systems and precision guidance systems.

7

The Company measures each reporting segment’s profit based upon operating income. Accordingly, the Company does not allocate net interest expense, other income (expense) — net and income taxes to its reporting segments. The company-wide Enterprise Resource Planning (ERP) costs that are not directly associated with a specific business were not allocated to the segments. The accounting policies of the reportable segments are the same as those for the Company’s condensed consolidated financial statements.

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2011			2010			2011			2010
				(Dollars in millions)
Sales:
Actuation and Landing Systems	$	736.7		$	608.1		$	1,421.0		$	1,221.2
Nacelles and Interior Systems		688.8			577.4			1,345.2			1,133.2
Electronic Systems		575.9			532.0			1,131.1			1,058.3
	$	2,001.4		$	1,717.5		$	3,897.3		$	3,412.7
Intersegment sales:
Actuation and Landing Systems	$	15.0		$	8.0		$	24.8		$	14.8
Nacelles and Interior Systems		3.2			2.9			6.0			4.8
Electronic Systems		11.6			6.0			22.5			12.7
	$	29.8		$	16.9		$	53.3		$	32.3
Operating income:
Actuation and Landing Systems(1)	$	76.5		$	60.5		$	163.0		$	129.9
Nacelles and Interior Systems		178.2			151.4			335.5			270.2
Electronic Systems		89.8			95.1			180.8			165.9
		344.5			307.0			679.3			566.0
Corporate general and administrative expenses		(36.7	)		(27.7	)		(67.6	)		(61.6	)
ERP costs		(4.9	)		(4.0	)		(8.5	)		(8.1	)
Total operating income	$	302.9		$	275.3		$	603.2		$	496.3

(1)	Acquisition of Microtecnica S.r.l
	On May 12, 2011, the Company acquired Microtecnica S.r.l. and incurred $8.1 million of acquisition-related costs which were reported in selling and administrative costs for the six months ended June 30, 2011. In addition, total assets for the Actuation and Landing Systems segment increased from $2,239.9 million at December 31, 2010 to $3,187.1 million at June 30, 2011, primarily related to this acquisition. See Note 9, “Goodwill”.
	Closure of a Landing Gear Facility
	On June 7, 2011, the Board of Directors of the Company authorized a plan to close a facility in its landing gear business. Due to declining program volumes, the Company will close the facility and incur substantially all of the costs by the end of 2012. The Company anticipates that it will incur costs in connection with this closure of approximately $37 million, of which approximately $15 million is for personnel related expenses, including severance, pension charges, outplacement services and assistance with employment transitioning, and approximately $22 million primarily related to facility closure and other costs, including accelerated depreciation, equipment dismantle and relocation costs and lease termination costs.
	During the three months ended June 30, 2011, the Company incurred $15.6 million of costs related to this closure for which $13.8 million was personnel related and $1.8 million was facility closure and other costs. $10.7 million of these costs were reported in cost of sales and $4.9 million were reported in selling and administrative costs.

8

Note 4. Other Income (Expense) — Net

Other Income (Expense) — Net consisted of the following:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2011			2010			2011			2010
				(Dollars in millions)
Retiree health care expenses related to previously owned businesses	$	(2.1	)	$	(2.6	)	$	(4.7	)	$	(5.3	)
Expenses related to previously owned businesses		(2.9	)		(3.1	)		(4.5	)		(4.3	)
Equity in affiliated companies		0.8			1.1			(0.1	)		(0.8	)
Other — net		—			0.2			(0.7	)		(0.4	)
Other income (expense) — net	$	(4.2	)	$	(4.4	)	$	(10.0	)	$	(10.8	)

Note 5. Share-Based Compensation

During the three and six months ended June 30, 2011 and 2010, the Company expensed share-based compensation awards under the Goodrich Equity Compensation Plan and the Goodrich Corporation 2008 Global Employee Stock Purchase Plan for employees and under the Outside Director Deferral and Outside Director Phantom Share plans for non-employee directors. A detailed description of the awards under these plans is included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2010.

The compensation cost recorded for share-based compensation plans during the three months ended June 30, 2011 and 2010 was $28.6 million and $15 million, respectively. The increase from 2010 to 2011 was primarily due to changes in the Company’s share price for the performance units and Outside Director Phantom Share Plan, changes in the expected return on invested capital (ROIC) as compared to a target ROIC for the performance units and by a higher grant date fair value for the restricted stock units and stock options.

The compensation cost recorded for share-based compensation plans during the six months ended June 30, 2011 and 2010 was $46.5 million and $33.2 million, respectively. The increase from 2010 to 2011 was primarily due to a higher grant date fair value for the restricted stock units and stock options, changes in the expected ROIC as compared to a target ROIC for the performance units and changes in the Company’s share price for the performance units and Outside Director Phantom Share Plan.

9

Note 6. Earnings Per Share

The computation of basic and diluted earnings per share (EPS) for income from continuing operations is as follows:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2011			2010			2011			2010
	(In millions, except per share amounts)
Numerator
Numerator for basic and diluted earnings per common share — income from continuing operations attributable to Goodrich	$	176.6		$	158.9		$	371.4		$	268.9
Percentage allocated to common shareholders (1)		98.6	%		98.6	%		98.6	%		98.6	%
Numerator for basic and diluted earnings per common share	$	174.1		$	156.8		$	366.2		$	265.2
Denominator
Denominator for basic earnings per common share — weighted-average shares		124.9			125.4			125.1			125.2
Effect of dilutive securities:
Stock options, employee stock purchase plan and other deferred compensation shares		1.0			1.1			1.0			1.2
Denominator for diluted earnings per common share — adjusted weighted-average shares and assumed conversion		125.9			126.5			126.1			126.4
Per common share income from continuing operations
Basic	$	1.39		$	1.25		$	2.93		$	2.12
Diluted	$	1.38		$	1.24		$	2.90		$	2.10

(1) Basic weighted-average common shares outstanding	124.9		125.4		125.1		125.2
Basic weighted-average common shares outstanding and unvested restricted share units expected to vest	126.7		127.1		126.9		126.9
Percentage allocated to common shareholders	98.6	%	98.6	%	98.6	%	98.6	%

The Company’s unvested restricted share units contain rights to receive nonforfeitable dividend equivalents, and thus, are participating securities requiring the two-class method of computing EPS. The calculation of EPS for common stock shown above excludes the income attributable to the unvested restricted share units from the numerator and excludes the dilutive impact of those units from the denominator.

At June 30, 2011 and 2010, the Company had 3.5 million and 4.2 million, respectively, of outstanding stock options. Stock options are included in the diluted earnings per share calculation using the treasury stock method, unless the effect of including the stock options would be anti-dilutive. For the six months ended June 30, 2011 and 2010, 0.7 million anti-dilutive stock options were excluded from the diluted EPS calculation.

During the six months ended June 30, 2011 and 2010, the Company issued 1.2 million and 2 million, respectively, of shares of common stock pursuant to stock option exercises and other share-based compensation plans.

The Company’s share repurchase program was approved by the Board of Directors for $1.1 billion in total. During the six months ended June 30, 2011 and 2010, the Company repurchased 1 million and 0.9 million shares, respectively. From inception of the program through June 30, 2011, the Company has repurchased 9.8 million shares for approximately $621 million under its share repurchase program.

10

Note 7. Fair Value Measurements

The Company defines fair value as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The following three levels of inputs are used to measure fair value:

Level 1 — quoted prices in active markets for identical assets and liabilities.

Level 2 — observable inputs other than quoted prices in active markets for identical assets and liabilities.

Level 3 — unobservable inputs in which there is little or no market data available, which require the reporting entity to develop its own assumptions.

The Company’s financial assets and (liabilities) measured at fair value on a recurring basis were, in millions, as follows:

	Fair Value										Fair Value
	June 30,										December 31,
	2011			Level 1		Level 2			Level 3		2010			Level 1		Level 2			Level 3
Cash Equivalents (1)	$	—		$	—	$	—		$	—	$	596.2		$	596.2	$	—		$	—
Derivative Financial Instruments (2)
Cash Flow Hedges		118.9			—		118.9			—		30.6			—		30.6			—
Other Forward Contracts		(1.0	)		—		(1.0	)		—		(0.2	)		—		(0.2	)		—
Rabbi Trust Assets (3)		60.9			60.9		—			—		55.3			55.3		—			—
Long-term debt (4)		(2,591.9	)		—		(2,591.9	)		—		(2,531.8	)		—		(2,531.8	)		—

(1)	Because of their short maturities, the carrying value of these assets approximates fair value.
(2)	See Note 17, “Derivatives and Hedging Activities”. Estimates of the fair value of the derivative financial instruments represent the Company’s best estimates based on its valuation models, which incorporate industry data and trends and relevant market rates and transactions.
(3)	Rabbi trust assets include mutual funds and cash equivalents for payment of certain non-qualified benefits for retired, terminated and active employees. The fair value of these assets was based on quoted market prices.
(4)	The carrying amount of the Company’s long-term debt was $2,371.8 million and $2,339.6 million at June 30, 2011 and December 31, 2010, respectively. The fair value of long-term debt is based on quoted market prices or on rates available to the Company for debt with similar terms and maturities.

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Note 8. Inventories

Inventories consist of the following:

	June 30,			December 31,
	2011			2010
	(Dollars in millions)
Average or actual cost (which approximates current costs):
Finished products	$	223.3		$	224.4
In-process		2,123.5			1,866.1
Raw materials and supplies		760.7			692.8
		3,107.5			2,783.3
Less:
Reserve to reduce certain inventories to LIFO basis		(53.7	)		(52.7	)
Progress payments and advances		(366.5	)		(281.2	)
Total	$	2,687.3		$	2,449.4

In-process inventory included $1,309.8 million and $1,154.2 million at June 30, 2011 and December 31, 2010, respectively, for the following: (1) pre-production and excess-over-average inventory accounted for under long-term contract accounting; and (2) engineering costs recoverable under long-term contractual arrangements. The June 30, 2011 balance of $1,309.8 million included $641.4 million related to the Boeing 787, $265.9 million related to the Airbus A350 XWB and $225.1 million related to the Pratt and Whitney PurePower^® PW 1000G engine contracts.

The Company uses the last-in, first-out (LIFO) cost method of valuing inventory for certain of the Company’s legacy aerospace manufacturing businesses, primarily the aircraft wheels and brakes business in the Actuation and Landing Systems segment. An actual valuation of inventory under the LIFO method can be made only at the end of each year based on the inventory levels and costs at that time.

Progress payments and advances represent (1) non-refundable payments for work-in-process and (2) cash received from government customers where the government has legal title to the work-in-process.

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Note 9. Goodwill

The changes in the carrying amount of goodwill by segment were as follows:

						Foreign
	Balance					Currency		Balance
	December 31,		Business			Translation/		June 30,
	2010		Combinations			Other		2011
			(Dollars in millions)
Actuation and Landing Systems(1)	$	327.7	$	213.1		$	9.9	$	550.7
Nacelles and Interior Systems(2)		591.6		(2.9	)		7.8		596.5
Electronic Systems		842.9		—			3.6		846.5
	$	1,762.2	$	210.2		$	21.3	$	1,993.7

(1)

On May 12, 2011, the Company acquired Microtecnica S.r.l. for $457.1 million in cash, net of cash acquired. Based on the Company’s preliminary purchase price allocation, $312.4 million was identifiable intangible assets primarily related to customer relationships, $213.1 million was goodwill and $106.4 million was net deferred tax liabilities primarily related to the intangible assets. The fair value of the intangible assets will be amortized over a weighted-average useful life of 27 years. Goodwill primarily represents the expected value from combining Microtecnica’s expertise in flight controls with the Company’s flight control actuation business. The goodwill related to the Microtecnica acquisition is not deductible for tax purposes. The final purchase price allocation will be based on information that provides a better estimate of the fair value of assets acquired and liabilities assumed.

(2)

On September 22, 2010, the Company acquired the cabin management assets of DeCrane Holdings Co. In the three months ended March 31, 2011, the Company finalized the purchase price which resulted in a decrease in goodwill.

Note 10. Financing Arrangements

During the three months ended June 30, 2011, the Company entered into a new five-year unsecured committed syndicated revolving credit facility, which permits borrowings up to a maximum of $700 million. In connection with entering into the new facility, the Company terminated its $500 million unsecured committed syndicated revolving credit facility that otherwise would have expired in May 2012. The new credit facility expires in May 2016. Interest rates under the new facility vary depending upon:

• The amount borrowed;

• The Company’s public debt rating by Standard & Poor’s, Moody’s and Fitch; and

• At the Company’s option, rates tied to the agent bank’s prime rate or, for U.S. Dollar and Great Britain Pounds Sterling borrowings, the London Interbank Offered Rate and for Euro borrowings, the Euro Interbank Offered Rate.

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At June 30, 2011, there were $32 million in borrowings and $45.5 million in letters of credit outstanding under the facility. At December 31, 2010, there were no borrowings and $62.5 million in letters of credit outstanding under the facility. In order to be eligible to borrow under the facility, the Company must be in compliance with a maximum leverage ratio covenant and other standard covenants. The Company is currently in compliance with all covenants. At June 30, 2011, the Company had borrowing capacity under this facility of $622.5 million, after reductions for borrowings and letters of credit outstanding under the facility.

At June 30, 2011, the Company also maintained $75 million of uncommitted U.S. working capital facilities and $178.1 million of uncommitted and committed foreign working capital facilities with various banks to meet short-term borrowing requirements. At June 30, 2011 and December 31, 2010, there were $36.1 million and $4.1 million, respectively, in borrowings and $22.9 million in letters of credit and bank guarantees outstanding under these facilities. These credit facilities are provided by a small number of commercial banks that also provide the Company with committed credit through the syndicated revolving credit facility described above and with various cash management, trust and other services.

At June 30, 2011, the Company had letters of credit and bank guarantees of $108.3 million, inclusive of letters of credit outstanding under the Company’s syndicated revolving credit facility, uncommitted U.S. working capital facilities and uncommitted and committed foreign working capital facilities, as discussed above.

Long-term Debt

Long-term debt and capital lease obligations, excluding current maturities, consisted of:

	June 30,		December 31,
	2011		2010
	(Dollars in millions)
Medium-term notes payable (interest rates from 6.8% to 8.7%)	$	398.9	$	398.9
6.29% senior notes, maturing in 2016		294.6		295.0
6.125% senior notes, maturing in 2019		298.2		298.1
4.875% senior notes, maturing in 2020		299.4		299.4
3.6% senior notes, maturing in 2021		598.8		598.8
6.80% senior notes, maturing in 2036		234.1		233.7
7.0% senior notes, maturing in 2038		199.2		199.2
Other debt, maturing through 2020 (interest rates from 0.2% to 2.5%)		48.6		16.5
		2,371.8		2,339.6
Capital lease obligations		12.8		13.2
Total	$	2,384.6	$	2,352.8

Lease Commitments

The Company leases certain of its office and manufacturing facilities, machinery and equipment and corporate aircraft under various committed lease arrangements provided by financial institutions. Future minimum lease payments under operating leases were $213.9 million at June 30, 2011.

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Note 11. Pensions and Postretirement Benefits Other Than Pensions

Pensions

The following table sets forth the components of net periodic benefit cost and the weighted-average assumptions used to determine the net periodic benefit cost. The net periodic benefit cost for divested or discontinued operations retained by the Company is included in the amounts below:

	U.S. Plans						U.K. Plans						Other Plans
	Three Months Ended						Three Months Ended						Three Months Ended
	June 30,						June 30,						June 30,
	2011			2010			2011			2010			2011			2010
	(Dollars in millions)
Service cost	$	12.2		$	11.4		$	4.4		$	3.6		$	2.0		$	1.2
Interest cost		42.5			42.1			10.4			9.5			2.3			1.7
Expected return on plan assets		(52.1	)		(47.9	)		(15.5	)		(12.7	)		(2.2	)		(1.8	)
Amortization of prior service cost		1.4			1.7			(0.2	)		(0.2	)		0.1			0.1
Amortization of actuarial loss		13.2			28.2			(0.4	)		0.7			0.7			0.4
Gross periodic benefit cost		17.2			35.5			(1.3	)		0.9			2.9			1.6
Settlement loss		0.2			—			—			—			—			—
Curtailment loss(1)		1.4			—			—			—			—			—
Net periodic benefit cost	$	18.8		$	35.5		$	(1.3	)	$	0.9		$	2.9		$	1.6
Termination benefit charge(1)	$	4.0		$	—		$	—		$	—		$	—		$	—

	U.S. Plans						U.K. Plans						Other Plans
	Six Months Ended						Six Months Ended						Six Months Ended
	June 30,						June 30,						June 30,
	2011			2010			2011			2010			2011			2010
	(Dollars in millions)
Service cost	$	24.4		$	23.1		$	8.6		$	7.7		$	3.7		$	2.4
Interest cost		85.6			84.3			21.2			19.3			4.3			3.5
Expected return on plan assets		(104.7	)		(93.8	)		(30.9	)		(25.9	)		(4.3	)		(3.5	)
Amortization of prior service cost		3.0			3.5			(0.3	)		(0.3	)		0.2			0.1
Amortization of actuarial loss		28.8			58.4			—			1.3			1.3			0.8
Gross periodic benefit cost		37.1			75.5			(1.4	)		2.1			5.2			3.3
Settlement loss		0.2			—			—			—			—			—
Curtailment loss(1)		1.4			—			—			—			—			—
Net periodic benefit cost	$	38.7		$	75.5		$	(1.4	)	$	2.1		$	5.2		$	3.3
Termination benefit charge(1)	$	4.0		$	—		$	0.7		$	—		$	—		$	—

(1) Due to the approval of a plan to close a U.S. facility, pension assumptions were reevaluated on June 7, 2011 for the remeasurement of a U.S. Wage Plan covering certain union employees. See Note 3, “Business Segment Information”. The facility closure resulted in a curtailment loss of $1.4 million and a contractual termination benefit charge of $4 million.

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The following table provides the weighted-average assumptions used to determine the net periodic benefit cost.

	U.S. Plans						U.K. Plans						Other Plans
	Three and Six Months						Three and Six Months						Three and Six Months
	Ended June 30,						Ended June 30,						Ended June 30,
	2011			2010			2011			2010			2011			2010
Discount rate 1/1 — 6/6		5.67	%		5.90	%		5.81	%		5.88	%		5.20	%		5.75	%
Discount rate 6/7 — 6/30		5.63	%		5.90	%		5.81	%		5.88	%		5.20	%		5.75	%
Expected long-term rate of return on assets		8.25	%		8.75	%		8.25	%		8.50	%		8.08	%		8.32	%
Rate of compensation increase		4.10	%		4.10	%		3.75	%		3.75	%		3.42	%		3.38	%

The Company generally amortizes the actuarial gains and losses for our pension plans over the average future service period of the active participants. However, beginning in 2011, the Company is amortizing the actuarial losses in its U.S. salaried plan over the remaining life of the inactive plan participants since almost all of the plan participants are now inactive. This resulted in a reduction in the amortization of actuarial losses from 2010 in the U.S. salaried plan.

Postretirement Benefits Other Than Pensions

The following table sets forth the components of net periodic postretirement benefit cost other than pensions. Other postretirement benefits related to the divested and discontinued operations retained by the Company are included in the amounts below.

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2011			2010			2011			2010
				(Dollars in millions)
Service cost	$	0.2		$	0.2		$	0.5		$	0.6
Interest cost		3.7			4.4			7.9			8.7
Amortization of prior service cost		(0.3	)		(0.1	)		(0.3	)		(0.1	)
Amortization of actuarial (gain) loss		—			—			—			—
Net periodic benefit cost	$	3.6		$	4.5		$	8.1		$	9.2

The following table provides the assumptions used to determine the net periodic postretirement benefit cost.

	Three and Six Months Ended June 30,
	2011		2010
Discount rate		5.29%		5.55%
Healthcare trend rate	7.5% in 2011 to 5% in 2017		7.3% in 2010 to 5% in 2015

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Note 12. Comprehensive Income (Loss)

Total comprehensive income (loss) consisted of the following:

	Three Months Ended					Six Months Ended
	June 30					June 30,
	2011		2010			2011		2010
			(Dollars in millions)
Net income attributable to Goodrich	$	176.6	$	159.0		$	371.4	$	270.2
Other comprehensive income (loss):
Unrealized foreign currency translation gains (losses) during period (1)		22.5		(74.7	)		83.1		(128.0	)
Pension/OPEB liability adjustments during the period, net of tax for the three and six months ended June 30, 2011 of ($22.3) and ($28.0), respectively; net of tax for the three and six months ended June 30, 2010 of ($12.7) and ($25.8), respectively		37.2		23.3			46.0		45.0
Gain (loss) on cash flow hedges, net of tax for the three and six months ended June 30, 2011 of ($7) and ($29.7), respectively; net of tax for the three and six months ended June 30, 2010 of $26.3 and $44.3, respectively		14.0		(57.9	)		62.0		(88.5	)
Total comprehensive income (loss)	$	250.3	$	49.7		$	562.5	$	98.7

Accumulated other comprehensive income (loss) consisted of the following:

	June 30,			December 31,
	2011			2010
	(Dollars in millions)
Cumulative unrealized foreign currency translation gains, net of deferred taxes of ($1.7) and ($1.7), respectively (1)	$	222.7		$	139.6
Pension/OPEB liability adjustments, net of deferred taxes of $467.1 and $495.1, respectively		(785.5	)		(831.5	)
Accumulated gains (losses) on cash flow hedges, net of deferred taxes of ($34.3) and ($4.6), respectively		77.8			15.8
TOTAL	$	(485.0	)	$	(676.1	)

(1) No other income taxes are provided on foreign currency translation gains (losses) for comprehensive income (loss) and accumulated other comprehensive income (loss) as foreign earnings are considered permanently invested.

Note 13. Noncontrolling Interests

The changes in the Company’s noncontrolling interests were as follows:

	Six months ended
	June 30,
	2011			2010
	(Dollars in millions)
Balance at January 1	$	40.9		$	46.6
Distributions to noncontrolling interests		(8.1	)		(11.3	)
Comprehensive income:
Net income attributable to noncontrolling interests		3.5			5.0
Other comprehensive income, net of tax		—			—
Comprehensive income		3.5			5.0
Balance at June 30	$	36.3		$	40.3

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Note 14. Income Taxes

The Company’s effective tax rate for the three months ended June 30, 2011 was 32.6%. Significant items that impacted the Company’s effective tax rate as compared to the U.S. federal statutory rate of 35% included earnings in foreign jurisdictions taxed at rates different from the statutory U.S. federal rate which reduced the effective tax rate by approximately 2 percentage points, foreign and domestic tax credits and benefits related to domestic manufacturing which reduced the effective tax rate by approximately 4 percentage points, state income taxes (net of related federal tax benefit) which increased the effective tax rate by approximately 1 percentage point and adjustments to reserves for tax contingencies, including interest thereon (net of related tax benefit), which increased the effective tax rate by approximately 1 percentage point.

The Company’s effective tax rate for the three months ended June 30, 2010 was 32.1%. Significant items that impacted the Company’s effective tax rate as compared to the U.S. federal statutory rate of 35% included earnings in foreign jurisdictions taxed at rates different from the statutory U.S. federal rate which reduced the effective tax rate by approximately 6 percentage points, foreign and domestic tax credits and benefits related to domestic manufacturing which reduced the effective tax rate by approximately 3 percentage points, deemed repatriation of non-U.S. earnings which increased the effective tax rate by approximately 2 percentage points, state income taxes (net of related tax benefit) which increased the effective tax rate by approximately 2 percentage points and adjustments to reserves for tax contingencies, including interest thereon (net of related tax benefit), which increased the effective tax rate by approximately 1 percentage point.

For the six months ended June 30, 2011, the Company reported an effective tax rate of 28.5%, including a tax settlement with the IRS for the remaining unresolved issue for tax years prior to 2000 which reduced the effective tax rate by approximately 4 percentage points. For the six months ended June 30, 2010, the Company reported an effective tax rate of 34.6%, including a charge of approximately $10 million due to the enactment of health care reform legislation in the U.S., which increased the effective tax rate by approximately 2 percentage points.

At June 30, 2011, the Company had $145.7 million of unrecognized tax benefits; however, the total amount of unrecognized benefits that, if recognized, would have affected the effective tax rate was $197.5 million. The difference relates to the impact of indirect effects including the federal benefit of state taxes and interest and penalties net of any related federal benefit as well as temporary differences which do not affect the effective tax rate. The Company recorded interest and penalties related to unrecognized tax benefits in income tax expense.

At December 31, 2010, the Company had $147.1 million of unrecognized tax benefits; however, the total amount of unrecognized benefits that, if recognized, would have affected the effective tax rate was $203.9 million. The difference relates to the impact of indirect effects including the federal benefit of state taxes and interest and penalties net of any related federal benefit as well as temporary differences which do not affect the effective tax rate.

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Note 15. Contingencies

General

There are various pending or threatened claims, lawsuits and administrative proceedings against the Company or its subsidiaries, arising from the ordinary course of business which seek remedies or damages. Although no assurance can be given with respect to the ultimate outcome of these matters, the Company believes that any liability that may finally be determined with respect to commercial and non-asbestos product liability claims should not have a material effect on its consolidated financial position, results of operations or cash flows. Legal costs are expensed as incurred.

Environmental

The Company is subject to environmental laws and regulations which may require that the Company investigate and remediate the effects of the release or disposal of materials at sites associated with past and present operations. At certain sites, the Company has been identified as a potentially responsible party under the federal Superfund laws and comparable state laws. The Company is currently involved in the investigation and remediation of a number of sites under applicable laws.

Estimates of the Company’s environmental liabilities are based on current facts, laws, regulations and technology. These estimates take into consideration the Company’s prior experience and professional judgment of the Company’s environmental specialists. Estimates of the Company’s environmental liabilities are further subject to uncertainties regarding the nature and extent of site contamination, the range of remediation alternatives available, evolving remediation standards, imprecise engineering evaluations and cost estimates, the extent of corrective actions that may be required and the number and financial condition of other potentially responsible parties, as well as the extent of their responsibility for the remediation.

Accordingly, as investigation and remediation proceed, it is likely that adjustments in the Company’s accruals will be necessary to reflect new information. The amounts of any such adjustments could have a material adverse effect on the Company’s results of operations or cash flows in a given period. Based on currently available information, however, the Company does not believe that future environmental costs in excess of those accrued with respect to sites for which the Company has been identified as a potentially responsible party are likely to have a material adverse effect on the Company’s financial condition.

19

Environmental liabilities are recorded when the liability is probable and the costs are reasonably estimable, which generally is not later than at completion of a feasibility study or when the Company has recommended a remedy or has committed to an appropriate plan of action. The liabilities are reviewed periodically and, as investigation and remediation proceed, adjustments are made as necessary. Liabilities for losses from environmental remediation obligations do not consider the effects of inflation and anticipated expenditures are not discounted to their present value. The liabilities are not reduced by possible recoveries from insurance carriers or other third parties, but do reflect anticipated allocations among potentially responsible parties at federal Superfund sites or similar state-managed sites, third party indemnity obligations or contractual obligations, and an assessment of the likelihood that such parties will fulfill their obligations at such sites.

The changes in the carrying amount of environmental liabilities for the six months ended June 30, 2011, in millions, are as follows:

Balance at December 31, 2010	$	67.7
Accruals and adjustments		3.4
Payments		(2.8	)
Foreign currency translation and other		4.2
Balance at June 30, 2011	$	72.5

At June 30, 2011 and December 31, 2010, $17 million and $14.6 million, respectively, of the accrued liability for environmental remediation were included in current liabilities as accrued expenses. At June 30, 2011 and December 31, 2010, $33.8 million and $27.3 million, respectively, was associated with ongoing operations and $38.7 million and $40.4 million, respectively, was associated with previously owned businesses.

The Company expects that it will expend present accruals over many years, and will generally complete remediation in less than 30 years at sites for which it has been identified as a potentially responsible party. This period includes operation and monitoring costs that are generally incurred over 15 to 25 years.

Certain states in the U.S. and countries globally are promulgating or proposing new or more demanding regulations or legislation impacting the use of various chemical substances by all companies. The Company continues to evaluate the potential impact, if any, of complying with such regulations and legislation.

Asbestos

The Company and some of its subsidiaries have been named as defendants in various actions by plaintiffs alleging damages as a result of exposure to asbestos fibers in products or at formerly owned facilities. The Company believes that pending and reasonably anticipated future actions are not likely to have a material adverse effect on the Company’s financial condition, results of operations or cash flows. There can be no assurance, however, that future legislative or other developments will not have a material adverse effect on the Company’s results of operations and cash flows in a given period.

20

Insurance Coverage

The Company maintains a comprehensive portfolio of insurance policies, including aviation products liability insurance which covers most of its products. The aviation products liability insurance typically provides first dollar coverage for defense and indemnity of third party claims.

A portion of the Company’s primary and excess layers of pre-1986 insurance coverage for third party claims, primarily related to certain long-tail toxic tort and environmental claims, was provided by certain insurance carriers who are either insolvent, undergoing solvent schemes of arrangement or in run-off. The Company has entered into settlement agreements with a number of these insurers pursuant to which the Company agreed to give up its rights with respect to certain insurance policies in exchange for negotiated payments. These settlements represent negotiated payments for the Company’s loss of insurance coverage, as it no longer has this insurance available for claims that may have qualified for coverage. The portion of these payments which related to recovery of past costs (recognized as expense in prior periods) or for which there are currently no anticipated future claims is recognized in income when the payments are received. The portion related to potential future claims is recorded as deferred settlement credits on the balance sheet.

The deferred settlement credits partially offset future costs related to insurable claims utilizing a systematic and consistent approach. The recognition of the deferred settlement credits is calculated utilizing the estimated percent of costs incurred in the current period that insurance companies would have reimbursed to the Company if insurance coverage were still in place. This approach utilizes historical claims and insurance information of the Company and is reviewed and updated at least annually.

A summary of the deferred settlement credits activity for the six months ended June 30, 2011, in millions, is as follows:

Balance at December 31, 2010	$	48.6
Proceeds from insurance settlements		0.5
Amounts recorded as reduction of costs		(2.7	)
Balance at June 30, 2011	$	46.4

The current and long-term portions of the deferred settlement credits were as follows:

	June 30,		December 31,
	2011		2010
	(Dollars in millions)
Accrued expenses	$	9.1	$	5.7
Other non-current liabilities		37.3		42.9
Total	$	46.4	$	48.6

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It is not practical to estimate when the remaining deferred settlement credits are expected to be recognized. The proceeds from such insurance settlements were reported as a component of net cash provided by operating activities in the period payments were received.

Liabilities of Divested Businesses

In connection with the divestiture of the Company’s tire, vinyl and other businesses, the Company has received contractual rights of indemnification from third parties for environmental and other claims arising out of the divested businesses. Failure of these third parties to honor their indemnification obligations could have a material adverse effect on the Company’s financial condition, results of operations and cash flows.

Aerostructures Long-term Contracts

The Company’s aerostructures business in the Nacelles and Interior Systems segment has several long-term contracts in the pre-production phase including the Airbus A350 XWB, the A320neo and the Pratt and Whitney PurePower^® PW 1000G engine contracts, and in the early production phase, including the Boeing 787. These contracts are accounted for in accordance with long-term construction contract accounting.

The pre-production phase includes design of the product to meet customer specifications as well as design of the processes to manufacture the product. Also involved in this phase is securing the supply of material and subcomponents produced by third party suppliers, generally accomplished through long-term supply agreements.

Contracts in the early production phase include excess-over-average inventories, which represent the excess of current manufactured cost over the estimated average manufactured cost during the life of the contract.

Cost estimates over the lives of contracts are affected by estimates of future cost reductions including learning curve efficiencies. Because these contracts cover manufacturing periods of up to 20 years or more, there is risk associated with the estimates of future costs made during the pre-production and early production phases. These estimates may be different from actual costs due to various risk factors, including the following:

• Ability to recover costs incurred for change orders and claims;

• Costs, including material and labor costs and related escalation;

• Labor improvements due to the learning curve experience;

• Anticipated cost and/or productivity improvements, including overhead absorption, related to new, or changes to, manufacturing methods and processes;

22

• Supplier pricing, including escalation where applicable, potential supplier claims, the supplier’s financial viability and the supplier’s ability to perform;

• The cost impact of product design changes that frequently occur during the flight test and certification phases of a program; and

• Effect of foreign currency exchange fluctuations.

Additionally, total contract revenue is based on estimates of future units to be delivered to the customer, the ability to recover costs incurred for change orders and claims and sales price escalation, where applicable. There is a risk that there could be differences between the actual units delivered and the estimated total units to be delivered under the contract and differences in actual revenues compared to estimates. Changes in estimates could have a material impact on the Company’s results of operations and cash flows.

Provisions for estimated losses on uncompleted contracts are recorded in the period such losses are determined to the extent total estimated costs exceed total estimated contract revenues.

Aerostructures Boeing 787 Nacelle Contract

During July 2011, the Company agreed to a contract modification with Boeing on the 787 contract. The contract modification extended the duration of the contract through 2030 and did not have a material effect on our financial position, results of operations and/or cash flows. The Company’s estimate of original equipment sales on this contract is approximately $9 billion. Aftermarket sales associated with this program are not accounted for using the percentage-of-completion method of accounting.

This program is in the early production phase, with entry into service expected by the end of 2011 followed by rapidly increasing production rates shortly thereafter. For this contract to remain profitable, it will be important that assumptions are realized as currently estimated in the Company’s outlook, such as:

• Supplier pricing consistent with projected costs must be negotiated for portions of the product. These prices could be impacted by design changes, changes in material costs and availability of reliable suppliers in competitive cost countries;

• New automated equipment is being utilized to manufacture the 787 composite nacelle, which is expected to reduce costs significantly during the contract period;

23

• Nacelle product design changes continue to occur to improve product performance, reduce weight and lower cost. The Company expects that some of the costs for these changes will be recoverable from Boeing and also expects to have success on its various cost reduction initiatives; and

• Material and overhead cost escalation and inflation assumptions could be different than estimated.

While the Company continues to believe the contract will be profitable, it is important to note that changes to any of the current cost and/or revenue assumptions will have a significant impact on the overall profitability of the contract and could have a material impact on the Company’s results of operations in the period identified. All of the risk factors listed in “Aerostructures Long-term Contracts” above could also affect the Company’s outlook of profitability on this contract.

JSTARS Program

In 2002, Seven Q Seven, Ltd. (7Q7) was selected by Northrop Grumman Corporation to provide propulsion pods for the re-engine program for the JT3D engines used by the U.S. Air Force. The Company was selected by 7Q7 as a supplier for the inlet, thrust reverser, exhaust, EBU, strut systems and wing interface systems. As of June 30, 2011, the Company had $20.7 million (net of advances of $8.1 million) of pre-production costs and inventory related to this program.

Future program funding remains uncertain and there can be no assurance of such funding. If the program were to be cancelled, the Company would recognize an impairment.

Tax

The Company is continuously undergoing examination by the IRS as well as various state and foreign jurisdictions. The IRS and other taxing authorities routinely challenge certain deductions and credits reported by the Company on its income tax returns. See Note 14, “Income Taxes”, for additional detail.

Tax Years 2007 and 2008

In January 2011, the IRS issued a Revenue Agent’s Report (RAR) for the tax years 2007 and 2008. In February 2011, the Company submitted a protest to the Appeals Division of the IRS with respect to certain unresolved issues which involve the proper timing of deductions. Although it is reasonably possible that these matters could be resolved during the next 12 months, the timing or ultimate outcome is uncertain.

Tax Years 2005 and 2006

During 2009, the IRS issued a RAR for the tax years 2005 and 2006. In July 2009, the Company submitted a protest to the Appeals Division of the IRS with respect to certain unresolved issues which involve the proper timing of deductions. Although it is reasonably possible that these matters could be resolved during the next 12 months, the timing or ultimate outcome is uncertain.

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Tax Years 2000 to 2004

During 2007, the IRS and the Company reached agreement on substantially all of the issues raised with respect to the examination of taxable years 2000 to 2004. The Company submitted a protest to the Appeals Division of the IRS with respect to the remaining unresolved issues which involve the proper timing of certain deductions. The Company and the IRS were unable to reach agreement on the remaining issues. In December 2009, the Company filed a petition in the U.S. Tax Court and in March 2010 the Company also filed a complaint in the Federal District Court. The Company believes the amount of the estimated tax liability if the IRS were to prevail is fully reserved. The Company cannot predict the timing or ultimate outcome of a final resolution of the remaining unresolved issues.

Tax Years Prior to 2000

The previous examination cycle included the consolidated income tax groups for the audit periods identified below:

Coltec Industries Inc. and Subsidiaries	December, 1997 — July, 1999 (through date of acquisition)
Goodrich Corporation and Subsidiaries	1998 — 1999 (including Rohr, Inc. (Rohr) and Coltec)

The IRS and the Company previously reached final settlement on all but one of the issues raised in this examination cycle. The Company received statutory notices of deficiency dated June 14, 2007 related to the remaining unresolved issue which involves the proper timing of certain deductions. The Company filed a petition with the U.S. Tax Court in September 2007 to contest the notices of deficiency.

In December 2010, the Company reached a tentative agreement with the IRS to settle the remaining unresolved issue but due to the size of the potential refund, the agreement required approval by the Joint Committee on Taxation (JCT). In January 2011, the JCT approved the terms of the settlement agreement. In March 2011, the U.S. Tax Court accepted the terms of the settlement agreement and agreed to the litigants’ request to dismiss the matter. The Company recognized a tax benefit of approximately $21 million in the three months ended March 31, 2011.

Rohr was examined by the State of California for the tax years ended July 31, 1985, 1986 and 1987. The State of California disallowed certain expenses incurred by one of Rohr’s subsidiaries in connection with the lease of certain tangible property. California’s Franchise Tax Board held that the deductions associated with the leased equipment were non-business deductions. In addition, California audited our amended tax returns filed to reflect the changes resulting from the settlement of the U.S. Tax Court for Rohr’s tax years 1986 to 1997.California issued an assessment based on numerous issues including proper timing of deductions and allowance of tax credits. In October 2010, a comprehensive settlement was reached with the California Tax Board addressing all issues for tax years 1985 through 2001. The Company recognized a tax benefit of approximately $23 million in the three months ended December 31, 2010.

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Note 16. Guarantees

The Company extends financial and product performance guarantees to third parties. At June 30, 2011, the following environmental remediation and indemnification and financial guarantees were outstanding:

	Maximum		Carrying
	Potential		Amount of
	Payment		Liability
	(Dollars in millions)
Environmental remediation and other indemnifications (Note 15, “Contingencies”)	No Limit		$	15.1
Guarantees of residual value on leases	$	28.1	$	—
Guarantees of JV debt and other financial instruments	$	41.7	$	—

The Company has guarantees of residual values on certain lease obligations in which the Company is obligated to either purchase or remarket the assets at the end of the lease term.

The Company is guarantor on a revolving credit agreement totaling £35 million between Rolls-Royce Goodrich Engine Control Systems Limited (JV) and a financial institution. In addition, the Company guarantees the JV’s foreign exchange credit line with a notional amount of $140.7 million and a fair value asset of $5.1 million at June 30, 2011. The Company is indemnified by Rolls-Royce for 50% of the gains/losses resulting from the foreign exchange hedges.

Service and Product Warranties

The Company provides service and warranty policies on certain of its products. The Company accrues liabilities under service and warranty policies based upon specific claims and a review of historical warranty and service claim experience. Adjustments are made to accruals as claim data and historical experience change. In addition, the Company incurs discretionary costs to service its products in connection with product performance issues.

The changes in the carrying amount of service and product warranties for the six months ended June 30, 2011, in millions, are as follows:

Balance at December 31, 2010	$	148.5
Net provisions for warranties issued during the period		29.1
Net change to warranties existing at the beginning of the year		0.5
Payments		(26.4	)
Foreign currency translation and other		9.2
Balance at June 30, 2011	$	160.9

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The current and long-term portions of service and product warranties were as follows:

	June 30,		December 31,
	2011		2010
	(Dollars in millions)
Accrued expenses	$	98.7	$	90.0
Other non-current liabilities		62.2		58.5
Total	$	160.9	$	148.5

Note 17. Derivatives and Hedging Activities

Cash Flow Hedges

The Company has subsidiaries that conduct a substantial portion of their business in Great Britain Pounds Sterling, Euros, Canadian Dollars, Indian Rupees and Polish Zlotys but have significant sales contracts that are denominated primarily in U.S. Dollars. Periodically, the Company enters into forward contracts to exchange U.S. Dollars for these currencies to hedge a portion of the Company’s exposure from U.S. Dollar sales.

The forward contracts described above are used to mitigate the potential volatility to earnings and cash flow arising from changes in currency exchange rates that impact the Company’s U.S. Dollar sales for certain foreign operations. The forward contracts are accounted for as cash flow hedges and are recorded in the Company’s condensed consolidated balance sheet at fair value, with the offset reflected in Accumulated Other Comprehensive Income (AOCI), net of deferred taxes. The gain or loss on the forward contracts is reported as a component of other comprehensive income (loss) (OCI) and reclassified into earnings in the same period or periods during which the hedged transactions affect earnings. The notional value of the forward contracts at June 30, 2011 and December 31, 2010 was $2,031.7 million and $2,286.5 million, respectively. As of June 30, 2011 and December 31, 2010, the total fair value before taxes of the Company’s forward contracts and the accounts in the condensed consolidated balance sheet in which the fair value amounts are included are shown below:

	June 30,		December 31,
	2011		2010
	(Dollars in millions)
Prepaid expenses and other assets	$	47.3	$	20.3
Other assets		82.3		44.6
Accrued expenses		8.4		22.7
Other non-current liabilities		2.3		11.6

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The amounts recognized in OCI and reclassified from AOCI into earnings are shown below:

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2011		2010			2011		2010
			(Dollars in millions)
Amount of gain/(loss) recognized in OCI, net of tax for the three and six months ended June 30, 2011 of $(7) and $(29.7), respectively; net of tax for the three and six months ended June 30, 2010 of $26.3 and $44.3, respectively	$	14.0	$	(57.9	)	$	62.0	$	(88.5	)
Amount of gain/(loss) reclassified from AOCI into earnings	$	6.7	$	(11.7	)	$	7.9	$	(16.9	)

The total fair value of the Company’s forward contracts of a $118.9 million net asset (before deferred taxes of $34 million) at June 30, 2011, combined with $1 million of losses on previously matured hedges of intercompany sales and gains from forward contracts terminated prior to the original maturity dates, is recorded in AOCI and will be reflected in income as earnings are affected by the hedged items. As of June 30, 2011, the portion of the net $118.9 million asset that would be reclassified into earnings to offset the effect of the hedged item in the next 12 months is a gain of $38.9 million. These forward contracts mature on a monthly basis with maturity dates that range from July 2011 to December 2015. There was a de minimis amount of both ineffectiveness and hedge components excluded from the assessment of effectiveness during the three and six months ended June 30, 2011 and 2010.

Fair Value Hedges

The Company enters into interest rate swaps to increase the Company’s exposure to variable interest rates. The settlement and maturity dates on each swap are the same as those on the referenced notes. The interest rate swaps are accounted for as fair value hedges and the carrying value of the notes is adjusted to reflect the fair values of the interest rate swaps. At June 30, 2011 and December 31, 2010, the Company had no outstanding interest rate swaps. Previously terminated swaps are amortized over the life of the underlying debt and recorded as a reduction to interest expense.

Other Forward Contracts

As a supplement to the foreign exchange cash flow hedging program, the Company enters into forward contracts to manage its foreign currency risk related to the translation of monetary assets and liabilities denominated in currencies other than the relevant functional currency. These forward contracts generally mature monthly and the notional amounts are adjusted periodically to reflect changes in net monetary asset balances. Since these contracts are not designated as hedges, the gains or losses on these forward contracts are recorded in selling and administrative costs or cost of sales, as appropriate. These contracts are utilized to mitigate the earnings impact of the translation of net monetary assets and liabilities.

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During the three months ended June 30, 2011, the Company recorded a transaction loss on its net monetary assets of $9.6 million, which was offset by gains on the other forward contracts described above of $4 million. During the three months ended June 30, 2010, the Company recorded a transaction gain on its monetary assets of $28.1 million, which was partially offset by losses on the other forward contracts described above of $20 million.

During the six months ended June 30, 2011, the Company recorded a transaction loss on its net monetary assets of $23.1 million, which was offset by gains on the other forward contracts described above of $14.2 million. During the six months ended June 30, 2010, the Company recorded a transaction gain on its monetary assets of $39.7 million, which was partially offset by losses on the other forward contracts described above of $32.5 million.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

YOU SHOULD READ THE FOLLOWING DISCUSSION AND ANALYSIS IN CONJUNCTION WITH OUR UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS INCLUDED IN ITEM 1 OF THIS DOCUMENT.

THIS MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS CONTAINS FORWARD-LOOKING STATEMENTS. SEE “FORWARD-LOOKING INFORMATION IS SUBJECT TO RISK AND UNCERTAINTY” FOR A DISCUSSION OF CERTAIN OF THE UNCERTAINTIES, RISKS AND ASSUMPTIONS ASSOCIATED WITH THESE STATEMENTS.

UNLESS OTHERWISE NOTED HEREIN, DISCLOSURES PERTAIN ONLY TO OUR CONTINUING OPERATIONS.

OVERVIEW

We are one of the largest worldwide suppliers of aerospace components, systems and services to the commercial and general aviation airplane markets. We are also a leading supplier of systems and products to the global defense and space markets. Our business is conducted globally with manufacturing, service and sales undertaken in various locations throughout the world. Our products and services are principally sold to customers in North America, Europe and Asia.

Key Market Channels for Products and Services, Growth Drivers and Industry and our Highlights

We participate in three key market channels: commercial, regional, business and general aviation airplane original equipment (OE); commercial, regional, business and general aviation airplane aftermarket; and defense and space.

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Commercial, Regional, Business and General Aviation Airplane OE

Commercial, regional, business and general aviation airplane OE includes sales of products and services for new airplanes produced by Airbus and Boeing, and regional, business and small airplane manufacturers.

The key growth drivers in this market channel include the number of orders for the manufacturers’ airplanes, which will be delivered to their customers over a period of several years, OE manufacturer production and delivery rates for in-service airplanes such as the Airbus A320 and Boeing 737NG, and introductions of new airplane models such as the Boeing 787 and 747-8 and the Airbus A350 XWB and A320neo, and engine types such as the Pratt and Whitney PurePower^® PW1000G.

We have significant sales content on most of the airplanes manufactured in this market channel. Over the last few years, we have benefited from the historically high production rates and deliveries of Airbus and Boeing airplanes and from our substantial content on many of the regional and general aviation airplanes. Airbus and Boeing have announced production rate increases for 2011 and beyond. However, production rates are always subject to change, and may be impacted by economic conditions which may influence customers’ willingness and/or ability to purchase new aircraft.

Commercial, Regional, Business and General Aviation Airplane Aftermarket

The commercial, regional, business and general aviation airplane aftermarket channel includes sales of products and services for existing commercial and general aviation airplanes, primarily to airlines and package carriers around the world.

We have significant product content on most of the airplane models that are currently in service and we enjoy the benefit of having excellent positions on the newer, more fuel-efficient airplanes currently in service. The key growth drivers in this channel include worldwide passenger capacity growth measured by Available Seat Miles (ASM) and the size, type and utilization levels of the worldwide airplane fleet. Other important factors affecting growth in this market channel are the age and types of the airplanes in the fleet, fuel prices, airline maintenance practices, Gross Domestic Product (GDP) trends in countries and regions around the world and domestic and international air freight activity.

Capacity in the global airline system, as measured by ASM, is expected to grow in 2011 as compared to 2010 due in large part to the expected global economic recovery. ASM expectations could be adversely affected if airlines choose to fly their in-service airplanes less frequently, or temporarily ground airplanes due to decreased demand, high fuel prices and other factors including weaker than expected global economic recovery.

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Defense and Space

Worldwide defense and space sales include sales to prime contractors such as Boeing, Northrop Grumman, Lockheed Martin, the U.S. Government and foreign companies and governments.

The key drivers in this channel include the level of defense spending by the U.S. and foreign governments, the number of new platform starts, the level of military flight operations, the level of upgrade, overhaul and maintenance activities associated with existing platforms and demand for optical surveillance and reconnaissance systems.

The market for our defense and space products is global, and is not dependent on any single program, platform or customer. We anticipate fewer new fighter and transport aircraft platform starts over the next several years. We also anticipate that the introduction of the F-35 Lightning II and new helicopter platforms, along with upgrades on existing defense and space platforms, will provide long-term growth opportunities in this market channel. Additionally, we are participating in, and developing new products for, the expanding intelligence, surveillance and reconnaissance sector (ISR), which should further strengthen our position in this market channel.

Long-term Sustainable Growth

We believe that we are well positioned to grow our sales, organically and through acquisitions, over the long-term due to:

• Awards for key products on important new and expected programs, including the Airbus A350 XWB and A320neo, the Boeing 787 and 747-8, the Pratt & Whitney PurePower^® PW1000G engine and the Lockheed Martin F-35 Lightning II;

• The large installed base on commercial airplanes and our strong positions on newer, more fuel-efficient airplanes, which should fuel sustained long-term aftermarket strength;

• Balance in the commercial airplane market, with strong sales to Airbus, Boeing and the regional and business jet airplane manufacturers;

• Aging of the existing large commercial and regional airplane fleets, which should result in increased aftermarket support;

• Increased number of long-term agreements for product and service sales on new and existing commercial airplanes;

• Increased opportunities for aftermarket growth due to airline outsourcing;

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• Growth in global maintenance, repair and overhaul (MRO) opportunities for our systems and components, particularly in Europe, Asia and the Middle East, where we have expanded our capacity; and

• Expansion of our product offerings in support of high growth areas in the defense and space market channel, such as helicopter products and systems, ISR products and precision guidance systems for munitions.

Second Quarter 2011 Sales Content by Market Channel

During the second quarter 2011, approximately 96% of our sales were from our three key market channels described above. Following is a summary of the percentage of sales by market channel:

Airbus Commercial OE	17	%
Boeing Commercial OE	10	%
Regional, Business and General Aviation Airplane OE	8	%
Total Large Commercial, Regional, Business and General Aviation Airplane OE	35	%
Large Commercial Airplane Aftermarket	24	%
Regional, Business and General Aviation Airplane Aftermarket	7	%
Total Large Commercial, Regional, Business and General Aviation Airplane Aftermarket	31	%
Total Defense and Space	30	%
Other	4	%
Total	100	%

Results of Operations — Second Quarter 2011 as Compared to Second Quarter 2010

	Second Quarter						Favorable / (Unfavorable)
	2011			2010			$ Change			% Change
	(Dollars in millions, except diluted EPS)
Sales	$	2,001.4		$	1,717.5		$	283.9			16.5
Segment operating income (1)	$	344.5		$	307.0		$	37.5			12.2
Corporate general and administrative costs		(41.6	)		(31.7	)		(9.9	)		(31.2	)
Total operating income		302.9			275.3			27.6			10.0
Net interest expense		(34.2	)		(33.3	)		(0.9	)		(2.7	)
Other income (expense) — net		(4.2	)		(4.4	)		0.2			4.5
Income from continuing operations before income taxes		264.5			237.6			26.9			11.3
Income tax expense		(86.2	)		(76.3	)		(9.9	)		(13.0	)
Income from continuing operations		178.3			161.3			17.0			10.5
Income from discontinued operations		—			0.1			(0.1	)		(100.0	)
Consolidated net income		178.3			161.4			16.9			10.5
Net income attributable to noncontrolling interests		(1.7	)		(2.4	)		0.7			29.2
Net income attributable to Goodrich	$	176.6		$	159.0		$	17.6			11.1
Effective tax rate		32.6	%		32.1	%
Diluted EPS:
Continuing operations	$	1.38		$	1.24		$	0.14			11.3
Net income attributable to Goodrich	$	1.38		$	1.24		$	0.14			11.3

(1) We measure each reporting segment’s profit based upon operating income. Accordingly, we do not allocate net interest expense, other income (expense) — net and income taxes to our reporting segments. The company-wide Enterprise Resource Planning (ERP) costs that were not directly associated with a specific business were not allocated to the segments. For a reconciliation of total segment operating income to total operating income, see Note 3, “Business Segment Information” to our condensed consolidated financial statements.

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Sales

The sales increase in the second quarter 2011 as compared to the second quarter 2010 was primarily driven by changes in each of our major market channels as follows:

• Large commercial airplane original equipment sales increased by approximately $77 million, or 17%;

• Regional, business and general aviation airplane original equipment sales increased by approximately $57 million, or 58%, including sales associated with the DeCrane Holdings Co. (DeCrane) acquisition in September 2010 and the Microtecnica S.r.l. (Microtecnica) acquisition in May 2011;

• Large commercial, regional, business and general aviation airplane aftermarket sales increased by approximately $83 million, or 16%; and

• Defense and space sales of both original equipment and aftermarket products and services increased by approximately $55 million, or 10%, including sales associated with the Microtecnica acquisition.

Segment operating income

See discussion in the “Business Segment Performance” section.

Corporate general and administrative costs

Corporate general and administrative costs increased primarily due to higher share-based compensation expense as discussed below.

Net interest expense

Net interest expense increased primarily as a result of higher debt levels in the second quarter 2011 as compared to the second quarter 2010.

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Income from continuing operations

In addition to the items described above, income from continuing operations during the second quarter 2011 as compared to the second quarter 2010 was impacted by the following items:

	Increase (Decrease)
	Before			After			Diluted
	Tax			Tax			EPS
	(Dollars in millions, except diluted EPS)
Lower pension and postretirement benefits expense	$	19.9		$	12.6		$	0.10
Landing gear plant closure costs	$	(15.6	)	$	(9.9	)	$	(0.08	)
Higher share-based compensation	$	(13.6	)	$	(8.6	)	$	(0.07	)
Changes in estimates on long-term contracts	$	(12.2	)	$	(7.6	)	$	(0.06	)
Microtecnica acquisition-related costs	$	(7.4	)	$	(7.4	)	$	(0.06	)

Lower pension and postretirement benefits expense

The decrease in pension and postretirement benefits expense was primarily the result of actuarial changes, including the change in the amortization period for gains and losses for our U.S. salaried plan; the benefit of $300 million in incremental contributions that were made in 2010; and favorable returns on our plan assets in 2010.

Landing gear plant closure costs

During the second quarter 2011, we incurred $15.6 million of costs related to the announced closure of a facility in our landing gear business due to declining program volumes. We will close the facility and incur substantially all of the costs by the end of 2012. See Note 3, “Business Segment Information” to our condensed consolidated financial statements.

Higher share-based compensation

The increase in share-based compensation was primarily due to the impact of the favorable change in our share price and changes in the expected return on invested capital (ROIC) as compared to a target ROIC for awards paid in cash and by a higher grant date fair value for our restricted stock units and stock options.

Changes in estimates on long-term contracts

During the second quarter 2011, we revised estimates on certain of our long-term contracts that were more favorable in 2010, primarily in our aerostructures and aircraft wheels and brakes businesses, resulting in lower before tax income of approximately $12 million. These revisions were primarily related to favorable cost and operational performance, changes in volume expectations and to some extent, sales pricing improvements on follow-on contracts.

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Microtecnica acquisition-related costs

During the second quarter 2011, we acquired Microtecnica and incurred $7.4 million of acquisition-related costs, including foreign currency costs associated with pre-positioning cash to execute the acquisition.

Results of Operations — Six Months Ended June 30, 2011 as Compared to Six Months Ended June 30, 2010

	Second Quarter						Favorable / (Unfavorable)
	2011			2010			$ Change			% Change
	(Dollars in millions, except diluted EPS)
Sales	$	3,897.3		$	3,412.7		$	484.6			14.2
Segment operating income (1)	$	679.3		$	566.0		$	113.3			20.0
Corporate general and administrative costs		(76.1	)		(69.7	)		(6.4	)		(9.2	)
Total operating income		603.2			496.3			106.9			21.5
Net interest expense		(68.5	)		(66.7	)		(1.8	)		(2.7	)
Other income (expense) — net		(10.0	)		(10.8	)		0.8			7.4
Income from continuing operations before income taxes		524.7			418.8			105.9			25.3
Income tax expense		(149.8	)		(144.9	)		(4.9	)		(3.4	)
Income from continuing operations		374.9			273.9			101.0			36.9
Income from discontinued operations		—			1.3			(1.3	)		(100.0	)
Consolidated net income		374.9			275.2			99.7			36.2
Net income attributable to noncontrolling interests		(3.5	)		(5.0	)		1.5			30.0
Net income attributable to Goodrich	$	371.4		$	270.2		$	101.2			37.5
Effective tax rate		28.5	%		34.6	%
Diluted EPS:
Continuing operations	$	2.90		$	2.10		$	0.80			38.1
Net income attributable to Goodrich	$	2.90		$	2.11		$	0.79			37.4

(1) We measure each reporting segment’s profit based upon operating income. Accordingly, we do not allocate net interest expense, other income (expense) — net and income taxes to our reporting segments. The company-wide Enterprise Resource Planning (ERP) costs that were not directly associated with a specific business were not allocated to the segments. For a reconciliation of total segment operating income to total operating income, see Note 3, “Business Segment Information” to our condensed consolidated financial statements.

Sales

The sales increase in the six months ended June 30, 2011 as compared to the six months ended June 30, 2010 was driven by changes in each of our major market channels as follows:

• Large commercial airplane original equipment sales increased by approximately $104 million, or 11%;

• Regional, business and general aviation airplane original equipment sales increased by approximately $109 million, or 57%, including sales associated with the DeCrane and Microtecnica acquisitions;

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• Large commercial, regional, business and general aviation airplane aftermarket sales increased by approximately $145 million, or 14%; and

• Defense and space sales of both original equipment and aftermarket products and services increased by approximately $109 million, or 10%, including sales associated with the Microtecnica acquisition.

Segment operating income

See discussion in the “Business Segment Performance” section.

Corporate general and administrative costs

Corporate general and administrative costs increased primarily due to higher share-based compensation expense as discussed below and higher incentive compensation costs.

Net interest expense

Net interest expense increased primarily as a result of higher borrowings in the six months ending June 30, 2011 as compared to the six months ending June 30, 2010.

Income from continuing operations

In addition to the items described above, income from continuing operations during the six months ended June 30, 2011 as compared to the six months ended June 30, 2010 was also impacted by the following items:

	Increase (Decrease)
	Before			After			Diluted
	Tax			Tax			EPS
	(Dollars in millions, except diluted EPS)
Lower effective tax rate	$	—		$	32.0		$	0.25
Lower pension and postretirement benefits expense	$	40.9		$	25.9		$	0.20
Landing gear plant closure costs	$	(15.6	)	$	(9.9	)	$	(0.08	)
Higher share-based compensation	$	(13.3	)	$	(8.4	)	$	(0.07	)
Microtecnica acquisition-related costs	$	(8.1	)	$	(8.1	)	$	(0.06	)

Lower effective tax rate

For the six months ended June 30, 2011, we reported an effective tax rate of 28.5% as compared to 34.6% for the six months ended June 30, 2010. The decrease in the effective tax rate was primarily due to a tax settlement with the IRS for the remaining unresolved issues for tax years prior to 2000 which reduced the effective tax rate for the six months ended June 30, 2011 by approximately 4 percentage points, and a charge of approximately $10 million in the first quarter of 2010 to adjust deferred income taxes for the enactment of health care reform legislation in the U.S., which increased our effective tax rate by approximately 2 percentage points.

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Our effective tax rate during the six months ended June 30, 2010 was not reduced for the benefit of the U.S. Research and Development Credit (R&D Credit) because the federal statute authorizing the R&D Credit had not been extended until the fourth quarter of 2010. We estimate that the effective tax rate at June 30, 2010 would have been approximately 1 percentage point lower had we been able to consider the tax benefits associated with the R&D Credit.

Lower pension and postretirement benefits expense

The decrease in pension and postretirement benefits expense was primarily the result of actuarial changes, including the change in the amortization period for gains and losses for our U.S. salaried plan; the benefit of $300 million in incremental contributions that were made in 2010; and favorable returns on our plan assets in 2010.

Landing gear plant closure costs

During the second quarter 2011, we incurred $15.6 million of costs related to the announced closure of a facility in our landing gear business due to declining program volumes. We will close the facility and incur substantially all of the costs by the end of 2012. See Note 3, “Business Segment Information” to our condensed consolidated financial statements.

Higher share-based compensation

The increase in share-based compensation was primarily due to a higher grant date fair value for our restricted stock units and stock options and changes in the expected ROIC as compared to a target ROIC and favorable changes in our share price for awards paid in cash.

Microtecnica acquisition-related costs

During the six months ended June 30, 2011, we acquired Microtecnica and incurred $8.1 million of acquisition-related costs, including foreign currency costs associated with pre-positioning cash to execute the acquisition.

2011 OUTLOOK

We expect the following approximate results for the year ending December 31, 2011:

	2011 Outlook	2010 Actual
Sales	$8.1 billion	$7 billion
Diluted EPS — Net Income Attributable to Goodrich	$5.85 to $6.00 per share	$4.51 per share
Capital Expenditures	$300 million to $350 million	$222.3 million
Operating Cash Flow minus Capital Expenditures	Exceed 85% of net income attributable to Goodrich	50% of net income attributable to Goodrich

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Our sales and net income per diluted share outlook for 2011 includes the impact of the Microtecnica acquisition, which is expected to increase sales in 2011 by approximately $150 million. The outlook does not include any other potential acquisitions or divestitures. Our 2011 outlook also includes, among other factors:

• Costs related to the decision to close a facility in our landing gear business by the end of 2012 of approximately $20 million, $13 million after tax or $0.10 per diluted share;

• Costs of approximately $8 million, or $0.06 per diluted share, associated with the Microtecnica acquisition;

• Lower worldwide pension expense of approximately $78 million, $49 million after tax or $0.39 per diluted share. For 2011, we expect total worldwide pension expense of approximately $84 million, compared to $162 million in 2010; and

• A full-year effective tax rate of approximately 30 percent for 2011, which is unchanged from our previous outlook. We expect an effective tax rate of approximately 32 percent for the remaining quarters of 2011.

Sales

Our current market assumptions for each of our major market channels for the full year 2011 outlook compared to 2010 include the following:

• Large commercial airplane original equipment sales are expected to increase approximately 15%. This outlook assumes all announced production rate increases are implemented and Boeing 787 and 747-8 deliveries are consistent with the latest schedule announced by Boeing;

• Regional, business and general aviation airplane original equipment sales are expected to grow approximately 40%, of which approximately 16% is organic growth;

• Large commercial, regional, business and general aviation airplane aftermarket sales are expected to increase approximately 13%, of which approximately 12% is organic growth; and

• Defense and space sales of both original equipment and aftermarket products and services are expected to increase approximately 15%, including sales associated with the Microtecnica acquisition. Organic growth is expected to be approximately 10%.

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Cash Flow

We expect net cash provided by operating activities, minus capital expenditures, to exceed 85% of net income. This outlook reflects ongoing investments to support the current schedule for the Boeing 787, Airbus A350 XWB and A320neo, Bombardier CSeries and Mitsubishi Regional Jet aircraft programs, fixed assets and working capital to support announced production rate increases associated with the Boeing 737 and Airbus A320 aircraft and competitive cost country manufacturing and productivity initiatives that are expected to enhance margins over the near and long term. We expect capital expenditures in 2011 to be approximately $300 million to $350 million. Worldwide pension plan contributions are expected to be approximately $100 million.

BUSINESS SEGMENT PERFORMANCE

Our three business segments are as follows:

• The Actuation and Landing Systems segment provides systems, components and related services pertaining to aircraft taxi, take-off, flight control, landing and stopping, and engine components, including fuel delivery systems and rotating assemblies.

• The Nacelles and Interior Systems segment produces products and provides maintenance, repair and overhaul services associated with aircraft engines, including thrust reversers, cowlings, nozzles and their components, and aircraft interior products, including slides, seats, cargo and lighting systems.

• The Electronic Systems segment produces a wide array of systems and components that provide flight performance measurements, flight management, fuel controls, electrical systems, control and safety data, reconnaissance and surveillance systems and precision guidance systems.

We measure each reporting segment’s profit based upon operating income. Accordingly, we do not allocate net interest expense, other income (expense) — net and income taxes to the reporting segments. The company-wide ERP costs that were not directly associated with a specific business were not allocated to the segments. The accounting policies of the reportable segments are the same as those for our condensed consolidated financial statements. For a reconciliation of total segment operating income to total operating income, see Note 3, “Business Segment Information” to our condensed consolidated financial statements.

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Second Quarter 2011 Compared with Second Quarter 2010

	Second Quarter				Increase/			%		% of Sales
	2011		2010		(Decrease)			Change		2011		2010
	(Dollars in millions)
NET CUSTOMER SALES
Actuation and Landing Systems	$	736.7	$	608.1	$	128.6			21.1
Nacelles and Interior Systems		688.8		577.4		111.4			19.3
Electronic Systems		575.9		532.0		43.9			8.3
	$	2,001.4	$	1,717.5	$	283.9			16.5
SEGMENT OPERATING INCOME
Actuation and Landing Systems	$	76.5	$	60.5	$	16.0			26.4		10.4		9.9
Nacelles and Interior Systems		178.2		151.4		26.8			17.7		25.9		26.2
Electronic Systems		89.8		95.1		(5.3	)		5.6		15.6		17.9
	$	344.5	$	307.0	$	37.5			12.2		17.2		17.9

Actuation and Landing Systems: Actuation and Landing Systems segment sales for the second quarter 2011 increased from the second quarter 2010 primarily due to the following:

• Higher large commercial airplane OE sales of approximately $40 million, primarily in our landing gear and actuation systems businesses;

• Higher large commercial, regional, business and general aviation airplane aftermarket sales of approximately $38 million, primarily in our aircraft wheels and brakes business;

• Higher defense and space OE and aftermarket sales of approximately $20 million, primarily in our aircraft wheels and brakes and actuation systems businesses, including incremental sales associated with the Microtecnica acquisition in May 2011;

• Higher other aerospace and non-aerospace sales of approximately $20 million, primarily in our actuation systems and engine components businesses; and

• Higher regional, business and general aviation airplane OE sales of approximately $11 million, primarily in our actuation systems business, including incremental sales associated with the Microtecnica acquisition.

Actuation and Landing Systems segment operating income for the second quarter 2011 increased from the second quarter 2010 primarily as a result of the following:

• Higher sales volume and favorable product mix across most businesses resulting in higher income of approximately $39 million; and

• Favorable pricing partially offset by higher operating costs across most businesses, which resulted in higher income of approximately $2 million; partially offset by

• Costs of approximately $16 million associated with the decision to close a facility in our landing gear business;

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• Costs related to the acquisition of Microtecnica of approximately $7 million; and

• Unfavorable foreign exchange, including remeasurement of monetary assets/liabilities, of approximately $2 million.

Nacelles and Interior Systems: Nacelles and Interior Systems segment sales for the second quarter 2011 increased from the second quarter 2010 primarily due to the following:

• Higher regional, business and general aviation airplane OE sales of approximately $40 million, primarily in our interiors and aerostructures businesses, including sales associated with the acquisition of DeCrane’s cabin management assets in September 2010;

• Higher large commercial, regional, business, and general aviation airplane aftermarket sales of approximately $30 million, primarily in our interiors and aerostructures businesses;

• Higher large commercial airplane OE sales of approximately $29 million, primarily in our aerostructures business; and

• Higher defense and space OE and aftermarket sales of approximately $13 million, primarily in our aerostructures business.

Nacelles and Interior Systems segment operating income for the second quarter 2011 increased from the second quarter 2010 primarily due to the following:

• Higher sales volume and favorable product mix which resulted in higher income of approximately $36 million, primarily in our aerostructures business; and

• Favorable pricing, primarily in our aerostructures business, and lower operating costs, primarily in our interiors business, which resulted in higher income of approximately $7 million; partially offset by

• Lower income of approximately $14 million related to revisions in estimates for certain long-term contracts in our aerostructures business that were more favorable in 2010; and

• Unfavorable foreign exchange, including remeasurement of monetary assets/liabilities, of approximately $2 million.

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Electronic Systems: Electronic Systems segment sales for the second quarter 2011 increased from the second quarter 2010 primarily due to the following:

• Higher defense and space OE and aftermarket sales across all businesses of approximately $22 million;

• Higher large commercial, regional, business and general aviation airplane aftermarket sales of approximately $16 million, primarily in our engine control and electrical power systems and sensors and integrated systems businesses;

• Higher large commercial airplane OE sales of approximately $7 million, primarily in our sensors and integrated systems and engine control and electrical power systems businesses; and

• Higher regional, business, and general aviation airplane OE sales of approximately $6 million, primarily in our sensors and integrated systems and engine control and electrical power systems businesses; partially offset by

• Lower other aerospace and non-aerospace sales of approximately $7 million, primarily in our sensors and integrated systems and engine control and electrical power systems businesses.

Electronic Systems segment operating income for the second quarter 2011 decreased from the second quarter 2010 primarily due to the following:

• Higher operating costs partially offset by favorable pricing, across all businesses, which resulted in lower income of approximately $9 million; and

• Unfavorable foreign exchange, including remeasurement of monetary assets/liabilities, of approximately $5 million; partially offset by

• Higher sales volume across most businesses, which resulted in higher income of approximately $9 million.

Six Months Ended June 30, 2011 Compared with Six Months Ended June 30, 2010

	Six Months Ended
	June 30,				Increase/		%		% of Sales
	2011		2010		(Decrease)		Change		2011		2010
	(Dollars in millions)
NET CUSTOMER SALES
Actuation and Landing Systems	$	1,421.0	$	1,221.2	$	199.8		16.4
Nacelles and Interior Systems		1,345.2		1,133.2		212.0		18.7
Electronic Systems		1,131.1		1,058.3		72.8		6.9
	$	3,897.3	$	3,412.7	$	484.6		14.2
SEGMENT OPERATING INCOME
Actuation and Landing Systems	$	163.0	$	129.9	$	33.1		25.5		11.5		10.6
Nacelles and Interior Systems		335.5		270.2		65.3		24.2		24.9		23.8
Electronic Systems		180.8		165.9		14.9		9.0		16.0		15.7
	$	679.3	$	566.0	$	113.3		20.0		17.4		16.6

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Actuation and Landing Systems: Actuation and Landing Systems segment sales for the six months ended June 30, 2011 increased from the six months ended June 30, 2010 primarily due to the following:

• Higher large commercial airplane OE sales of approximately $55 million, primarily in our landing gear and actuation systems businesses;

• Higher defense and space OE and aftermarket sales of approximately $50 million, primarily in our aircraft wheels and brakes and actuation systems businesses, including sales associated with the Microtecnica acquisition;

• Higher large commercial, regional, business and general aviation airplane aftermarket sales of approximately $49 million, primarily in our aircraft wheels and brakes business;

• Higher other aerospace and non-aerospace sales of approximately $25 million, primarily in our actuation systems and engine components businesses; and

• Higher regional, business and general aviation airplane OE sales of approximately $21 million, primarily in our actuation systems and landing gear businesses, including sales associated with the Microtecnica acquisition.

Actuation and Landing Systems segment operating income for the six months ended June 30, 2011 increased from the six months ended June 30, 2010 primarily as a result of the following:

• Higher sales volume and favorable product mix across most businesses resulting in higher income of approximately $71 million; partially offset by

• Higher operating costs partially offset by favorable pricing across all businesses, which resulted in lower income of approximately $11 million;

• Costs of approximately $16 million associated with the decision to close a facility in our landing gear business;

• Costs related to the acquisition of Microtecnica of approximately $8 million; and

• Unfavorable foreign exchange, including remeasurement of monetary assets/liabilities, of approximately $5 million.

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Nacelles and Interior Systems: Nacelles and Interior Systems segment sales for the six months ended June 30, 2011 increased from the six months ended June 30, 2010 primarily due to the following:

• Higher regional, business, and general aviation airplane OE sales of approximately $83 million, primarily in our interiors and aerostructures businesses, including sales associated with the acquisition of DeCrane’s cabin management assets;

• Higher large commercial, regional, business and general aviation airplane aftermarket sales of approximately $64 million, primarily in our interiors and aerostructures businesses;

• Higher large commercial airplane OE sales of approximately $38 million, primarily in our aerostructures business; and

• Higher defense and space OE and aftermarket sales of approximately $26 million, primarily in our aerostructures business.

Nacelles and Interior Systems segment operating income for the six months ended June 30, 2011 increased from the six months ended June 30, 2010 primarily due to the following:

• Higher sales volume and favorable product mix which resulted in higher income of approximately $73 million, primarily in our aerostructures business; and

• Favorable pricing, primarily in our aerostructures business, which resulted in higher income of approximately $12 million; partially offset by

• Lower income of approximately $15 million related to revisions in estimates for certain long-term contracts in our aerostructures business that were more favorable in 2010; and

• Unfavorable foreign exchange, including remeasurement of monetary assets/liabilities, of approximately $4 million.

Electronic Systems: Electronic Systems segment sales for the six months ended June 30, 2011 increased from the six months ended June 30, 2010 primarily due to the following:

• Higher large commercial, regional, business and general aviation airplane aftermarket sales of approximately $33 million, primarily in our engine control and electrical power systems business;

• Higher defense and space OE and aftermarket sales of approximately $30 million, primarily in our ISR and sensors and integrated systems businesses;

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• Higher large commercial airplane OE sales of approximately $11 million, primarily in our sensors and integrated systems and engine control and electrical power systems businesses; and

• Higher regional, business and general aviation airplane OE sales of approximately $5 million, primarily in our sensors and integrated systems business; partially offset by

• Lower other aerospace and non-aerospace sales of approximately $8 million, primarily in our sensors and integrated systems and engine control and electrical power systems businesses.

Electronic Systems segment operating income for the six months ended June 30, 2011 increased from the six months ended June 30, 2010 primarily due to the following:

• Higher sales volume across most businesses partially offset by unfavorable product mix across all businesses, which resulted in higher income of approximately $17 million; and

• Higher income of approximately $8 million related to changes in estimates for certain long-term contracts in our ISR business, consisting of favorable changes in estimates of approximately $3 million in the six months ended June 30, 2011 compared to a charge of approximately $5 million in the six months ended June 30, 2010; partially offset by

• Higher operating costs across all businesses, partially offset by favorable pricing in our sensors and integrated systems and engine control and electrical power systems businesses, which resulted in lower income of approximately $8 million; and

• Unfavorable foreign exchange, including remeasurement of monetary assets/liabilities, of approximately $3 million.

LIQUIDITY AND CAPITAL RESOURCES

We currently expect to fund expenditures for capital requirements and other liquidity needs from a combination of cash, internally generated funds and financing arrangements, including our committed revolving credit facility discussed below. We believe that our internal liquidity, together with access to external capital resources, will be sufficient to satisfy existing plans and commitments, including our stock repurchase program, and also provide adequate financial flexibility due to our strong balance sheet, lack of any large near-term funding requirements and a committed credit facility with a strong banking group.

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The following events have or will affect our liquidity and capital resources during 2011:

• We repurchased 1 million shares for $84 million under our share repurchase program;

• We contributed approximately $89 million to our worldwide pension and postretirement benefit plans through June 30, 2011;

• We paid a quarterly dividend of $0.29 per share on April 1 and July 1;

• On May 12, 2011, we completed the acquisition of Microtecnica, a leading provider of flight control actuation systems for helicopter, regional and business aircraft, missile actuation, and aircraft thermal and environmental control systems, for $457.1 million, net of cash acquired. Microtecnica is reported in the Actuation and Landing Systems segment; and

• On May 20, 2011, we entered into a new five-year unsecured committed syndicated revolving credit facility, which permits borrowings up to a maximum of $700 million. In connection with entering into the new facility, we terminated our $500 million unsecured committed syndicated revolving credit facility that otherwise would have expired in May 2012. The new credit facility expires in May 2016.

Cash

At June 30, 2011, we had cash and cash equivalents of $518 million, as compared to $798.9 million at December 31, 2010.

Credit Facilities

We have the following amounts available under our credit facilities:

• $700 million committed global revolving credit facility that expires in May 2016, of which $622.5 million was available at June 30, 2011; and

• $75 million of uncommitted domestic working capital facilities of which $52.3 million was available at June 30, 2011 and $178.1 million of uncommitted and committed foreign working capital facilities with various banks to meet short-term borrowing and documentary credit requirements, of which $141.8 million was available at June 30, 2011.

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Off-Balance Sheet Arrangements

Lease Commitments

We lease certain of our office and manufacturing facilities, machinery and equipment and corporate aircraft under various committed lease arrangements provided by financial institutions. Future minimum lease payments under operating leases were $213.9 million at June 30, 2011.

Derivatives

We utilize certain derivative financial instruments to enhance our ability to manage risk, including foreign currency and interest rate exposures that exist as part of ongoing business operations as follows:

• Foreign Currency Contracts Designated as Cash Flow Hedges: At June 30, 2011, our contracts had a notional amount of $2,031.7 million, fair value of a $118.9 million net asset and maturity dates ranging from July 2011 to December 2015. The amount of accumulated other comprehensive income that would be reclassified into earnings in the next 12 months is a gain of $38.9 million. During the six months ended June 30, 2011 and 2010, we realized a net gain of $7.9 million and a net loss of $16.9 million, respectively, related to contracts that settled. During the second quarter of 2011 and 2010, we realized a net gain of $6.7 million and a net loss of $11.7 million, respectively, related to contracts that settled.

• Foreign Currency Contracts not Designated as Hedges: At June 30, 2011, our contracts had a notional amount of $11 million and a fair value net liability of $1 million. During the six months ended June 30, 2011 and 2010, we realized net gains of $14.2 million and net losses of $32.5 million, respectively, for contracts entered into and settled during those periods. During the second quarter of 2011 and 2010, we realized net gains of $4 million and net losses of $20 million, respectively for contracts entered into and settled during those periods.

Estimates of the fair value of our derivative financial instruments represent our best estimates based on our valuation models, which incorporate industry data and trends and relevant market rates and transactions. Counterparties to these financial instruments expose us to credit loss in the event of nonperformance; however, we do not expect any of the counterparties to fail to meet their obligations. Counterparties, in most cases, are large commercial banks that also provide us with our committed credit facilities. To manage this credit risk, we select counterparties based on credit ratings, limit our exposure to any single counterparty and monitor our market position with each counterparty.

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Contractual Obligations and Other Commercial Commitments

As of June 30, 2011, purchase obligations were approximately $895 million, compared to approximately $811 million at December 31, 2010. In addition, we entered into a contract in the first quarter 2011 whereby we are obligated to make $60 million of participation payments, which will be paid through 2018. There have been no other material changes to the table presented in our Annual Report on Form 10-K for the year ended December 31, 2010 except for a new five-year unsecured committed syndicated revolving credit facility, which permits borrowings up to a maximum of $700 million. In connection with entering into the new facility, the Company terminated its $500 million unsecured committed syndicated revolving credit facility that otherwise would have expired in May 2012. The new credit facility expires in May 2016. The table excludes our liability for unrecognized tax benefits, which was $145.7 million at June 30, 2011, since we cannot predict with reasonable reliability the timing of cash settlements to the respective taxing authorities.

CASH FLOW

The following table summarizes our cash flow activity for the six months ended June 30, 2011 and 2010:

	2011			2010			Change
	(Dollars in millions)
Operating activities of continuing operations	$	337.6		$	253.0		$	84.6
Investing activities of continuing operations	$	(547.6	)	$	(114.1	)	$	(443.5	)
Financing activities of continuing operations	$	(77.6	)	$	(68.6	)	$	(9.0	)
Discontinued operations	$	(0.2	)	$	(0.4	)	$	0.2

Operating Activities of Continuing Operations

The increase in net cash provided by operating activities for the six months ended June 30, 2011 primarily consisted of higher cash flow from operations and lower pension contributions, partially offset by increased working capital to support our higher sales volume and new program requirements. Pension and postretirement benefit contributions were $88.8 million and $129.8 million for the six months ended June 30, 2011 and 2010, respectively.

Investing Activities of Continuing Operations

Net cash used by investing activities for the six months ended June 30, 2011 and 2010 included capital expenditures of $98 million and $51.6 million, respectively, and net payments made for acquisitions, net of cash acquired, of $448.8 million and $61.6 million, respectively.

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Financing Activities of Continuing Operations

The increase in net cash used in financing activities for the six months ended June 30, 2011 was primarily due to higher purchases of our common stock in connection with our share repurchase program and lower proceeds from the issuance of common stock, partially offset by lower dividend payments as the fourth quarter 2010 dividend declared was paid on December 30, 2010 and proceeds from borrowings under our syndicated revolving credit facility.

CONTINGENCIES

General

There are various pending or threatened claims, lawsuits and administrative proceedings against us or our subsidiaries, arising in the ordinary course of business, which seek remedies or damages. Although no assurance can be given with respect to the ultimate outcome of these matters, we believe that any liability that may finally be determined with respect to commercial and non-asbestos product liability claims should not have a material effect on our consolidated financial position, results of operations or cash flows. Legal costs are expensed when incurred.

Environmental

We are subject to environmental laws and regulations which may require that we investigate and remediate the effects of the release or disposal of materials at sites associated with past and present operations. At certain sites we have been identified as a potentially responsible party under the federal Superfund laws and comparable state laws. We are currently involved in the investigation and remediation of a number of sites under applicable laws.

Estimates of our environmental liabilities are based on current facts, laws, regulations and technology. These estimates take into consideration our prior experience and professional judgment of our environmental specialists. Estimates of our environmental liabilities are further subject to uncertainties regarding the nature and extent of site contamination, the range of remediation alternatives available, evolving remediation standards, imprecise engineering evaluations and cost estimates, the extent of corrective actions that may be required and the number and financial condition of other potentially responsible parties, as well as the extent of their responsibility for the remediation.

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Accordingly, as investigation and remediation proceed, it is likely that adjustments in our accruals will be necessary to reflect new information. The amounts of any such adjustments could have a material adverse effect on our results of operations or cash flows in a given period. Based on currently available information, however, we do not believe that future environmental costs in excess of those accrued with respect to sites for which we have been identified as a potentially responsible party are likely to have a material adverse effect on our financial condition.

Environmental liabilities are recorded when the liability is probable and the costs are reasonably estimable, which generally is not later than at completion of a feasibility study or when we have recommended a remedy or have committed to an appropriate plan of action. The liabilities are reviewed periodically and, as investigation and remediation proceed, adjustments are made as necessary. Liabilities for losses from environmental remediation obligations do not consider the effects of inflation and anticipated expenditures are not discounted to their present value. The liabilities are not reduced by possible recoveries from insurance carriers or other third parties, but do reflect anticipated allocations among potentially responsible parties at federal Superfund sites or similar state-managed sites, third party indemnity obligations or contractual obligations, and an assessment of the likelihood that such parties will fulfill their obligations at such sites.

The changes in the carrying amount of environmental remediation obligations for the six months ended June 30, 2011, in millions, are as follows:

Balance at December 31, 2010	$	67.7
Accruals and adjustments		3.4
Payments		(2.8	)
Foreign currency translation and other		4.2
Balance at June 30, 2011	$	72.5

At June 30, 2011 and December 31, 2010, $17 million and $14.6 million, respectively, of the accrued liability for environmental remediation were included in current liabilities. At June 30, 2011 and December 31, 2010, $33.8 million and $27.3 million, respectively, was associated with ongoing operations and $38.7 million and $40.4 million, respectively, was associated with previously owned businesses.

We expect that we will expend present accruals over many years, and will generally complete remediation in less than 30 years at sites for which we have been identified as a potentially responsible party. This period includes operation and monitoring costs that are generally incurred over 15 to 25 years.

Certain states in the U.S. and countries globally are promulgating or proposing new or more demanding regulations or legislation impacting the use of various chemical substances by all companies. We continue to evaluate the potential impact, if any, of new regulations and legislation.

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Asbestos

We and some of our subsidiaries have been named as defendants in various actions by plaintiffs alleging damages as a result of exposure to asbestos fibers in products or at formerly owned facilities. We believe that pending and reasonably anticipated future actions are not likely to have a material adverse effect on our financial condition, results of operations or cash flows. There can be no assurance, however, that future legislative or other developments will not have a material adverse effect on our results of operations or cash flows in a given period.

Insurance Coverage

We maintain a comprehensive portfolio of insurance policies, including aviation products liability insurance which covers most of our products. The aviation products liability insurance typically provides first dollar coverage for defense and indemnity of third party claims.

A portion of our primary and excess layers of pre-1986 insurance coverage for third party claims, primarily related to certain long-tail toxic tort and environmental claims, was provided by certain insurance carriers who are either insolvent, undergoing solvent schemes of arrangement or in run-off. We have entered into settlement agreements with a number of these insurers pursuant to which we agreed to give up our rights with respect to certain insurance policies in exchange for negotiated payments. These settlements represent negotiated payments for our loss of insurance coverage, as we no longer have this insurance available for claims that may have qualified for coverage. The portion of these payments which related to recovery of past costs (recognized as expense in prior periods) or for which there are currently no anticipated future claims is recognized in income when the payments are received. The portion related to potential future claims is recorded as deferred settlement credits on the balance sheet.

The deferred settlement credits partially offset future costs related to insurable claims utilizing a systematic and consistent approach. The recognition of the deferred settlement credits is calculated utilizing the estimated percent of costs incurred in the current period that insurance companies would have reimbursed to us if insurance coverage were still in place. This approach utilizes our historical claims and insurance information and is reviewed and updated at least annually.

A summary of the deferred settlement credits activity for the six months ended June 30, 2011, in millions, is as follows:

Balance at December 31, 2010	$	48.6
Proceeds from insurance settlements		0.5
Amounts recorded as reduction of costs		(2.7	)
Balance at June 30, 2011	$	46.4

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The current and long-term portions of the deferred settlement credits were as follows:

	June 30,		December 31,
	2011		2010
	(Dollars in millions)
Accrued expenses	$	9.1	$	5.7
Other non-current liabilities		37.3		42.9
Total	$	46.4	$	48.6

It is not practical to estimate when the remaining deferred settlement credits are expected to be recognized. The proceeds from such insurance settlements were reported as a component of net cash provided by operating activities in the period payments were received.

Liabilities of Divested Businesses

In connection with the divestitures of our tire, vinyl, engineered industrial products and other businesses, we have received contractual rights of indemnification from third parties for environmental, asbestos and other claims arising out of the divested businesses. Failure of these third parties to honor their indemnification obligations could have a material adverse effect on our results of operations and cash flows.

Guarantees

At June 30, 2011, we had letters of credit and bank guarantees of $108.3 million and residual value guarantees of lease obligations of $28.1 million. See Note 10, “Financing Arrangements” to our condensed consolidated financial statements. At June 30, 2011, we were a guarantor on a revolving credit agreement totaling £35 million between Rolls-Royce Goodrich Engine Control Systems Limited (JV) and a financial institution. In addition, we guarantee the JV’s foreign exchange credit line with a notional amount of $140.7 million at June 30, 2011. We are indemnified by Rolls-Royce for 50% of the gains/losses resulting from the foreign exchange hedges.

Aerostructures Long-term Contracts

Our aerostructures business in the Nacelles and Interior Systems segment has several long-term contracts in the pre-production phase including the Airbus A350 XWB, the A320neo and the Pratt and Whitney PurePower^® PW 1000G engine contracts, and in the early production phase, including the Boeing 787. These contracts are accounted for in accordance with long-term construction contract accounting.

The pre-production phase includes design of the product to meet customer specifications as well as design of the processes to manufacture the product. Also involved in this phase is securing the supply of material and subcomponents produced by third party suppliers, generally accomplished through long-term supply agreements.

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Contracts in the early production phase include excess-over-average inventories, which represent the excess of current manufactured cost over the estimated average manufactured cost during the life of the contract.

Cost estimates over the lives of contracts are affected by estimates of future cost reductions including learning curve efficiencies. Because these contracts cover manufacturing periods of up to 20 years or more, there is risk associated with the estimates of future costs made during the pre-production and early production phases. These estimates may be different from actual costs due to various risk factors, including the following:

• Ability to recover costs incurred for change orders and claims;

• Costs, including material and labor costs and related escalation;

• Labor improvements due to the learning curve experience;

• Anticipated cost and/or productivity improvements, including overhead absorption, related to new, or changes to, manufacturing methods and processes;

• Supplier pricing, including escalation where applicable, potential supplier claims, the supplier’s financial viability and the supplier’s ability to perform;

• The cost impact of product design changes that frequently occur during the flight test and certification phases of a program; and

• Effect of foreign currency exchange fluctuations.

Additionally, total contract revenue is based on estimates of future units to be delivered to the customer, the ability to recover costs incurred for change orders and claims and sales price escalation, where applicable. There is a risk that there could be differences between the actual units delivered and the estimated total units to be delivered under the contract and differences in actual revenues compared to estimates. Changes in estimates could have a material impact on our results of operations and cash flows.

Provisions for estimated losses on uncompleted contracts are recorded in the period such losses are determined to the extent total estimated costs exceed total estimated contract revenues.

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Aerostructures Boeing 787 Nacelle Contract

During July 2011, we agreed to a contract modification with Boeing on the 787 contract. The contract modification extended the duration of the contract through 2030 and did not have a material effect on our financial position, results of operations and/or cash flows. Our estimate of original equipment sales on this contract is approximately $9 billion. Aftermarket sales associated with this program are not accounted for using the percentage-of-completion method of accounting.

This program is in the early production phase, with entry into service expected by the end of 2011 followed by rapidly increasing production rates shortly thereafter. For this contract to remain profitable, it will be important that assumptions are realized as currently estimated in our outlook, such as:

• Supplier pricing consistent with projected costs must be negotiated for portions of the product. These prices could be impacted by design changes, changes in material costs and availability of reliable suppliers in competitive cost countries;

• New automated equipment is being utilized to manufacture the 787 composite nacelle, which is expected to reduce costs significantly during the contract period;

• Nacelle product design changes continue to occur to improve product performance, reduce weight and lower cost. We expect that some of the costs for these changes will be recoverable from Boeing and also expect to have success on our various cost reduction initiatives; and

• Material and overhead cost escalation and inflation assumptions could be different than estimated.

While we continue to believe the contract will be profitable, it is important to note that changes to any of the current cost and/or revenue assumptions will have a significant impact on the overall profitability of the contract and could have a material impact on our results of operations in the period identified. All of the risk factors listed in “Aerostructures Long-term Contracts” above could also affect our outlook of profitability on this contract.

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JSTARS Program

In 2002, Seven Q Seven, Ltd. (7Q7) was selected by Northrop Grumman Corporation to provide propulsion pods for the re-engine program for the JT3D engines used by the U.S. Air Force. We were selected by 7Q7 as a supplier for the inlet, thrust reverser, exhaust, EBU, strut systems and wing interface systems. As of June 30, 2011, we had $20.7 million (net of advances of $8.1 million) of pre-production costs and inventory related to this program.

Future program funding remains uncertain and there can be no assurance of such funding. If the program were to be cancelled, we would recognize an impairment.

Tax

We are continuously undergoing examination by the IRS as well as various state and foreign jurisdictions. The IRS and other taxing authorities routinely challenge certain deductions and credits reported by us on our income tax returns. See Note 14, “Income Taxes”, for additional detail.

Tax Years 2007 and 2008

In January 2011, the IRS issued a Revenue Agent’s Report (RAR) for the tax years 2007 and 2008. In February 2011, we submitted a protest to the Appeals Division of the IRS with respect to certain unresolved issues which involve the proper timing of deductions. Although it is reasonably possible that these matters could be resolved during the next 12 months, the timing or ultimate outcome is uncertain.

Tax Years 2005 and 2006

During 2009, the IRS issued a RAR for the tax years 2005 and 2006. In July 2009, we submitted a protest to the Appeals Division of the IRS with respect to certain unresolved issues which involve the proper timing of deductions. Although it is reasonably possible that these matters could be resolved during the next 12 months, the timing or ultimate outcome is uncertain.

Tax Years 2000 to 2004

During 2007, we reached agreement with the IRS on substantially all of the issues raised with respect to the examination of taxable years 2000 to 2004. We submitted a protest to the Appeals Division of the IRS with respect to the remaining unresolved issues which involve the proper timing of certain deductions. We were unable to reach agreement with the IRS on the remaining issues. In December 2009, we filed a petition in the U.S. Tax Court and in March 2010 we also filed a complaint in the Federal District Court. If the IRS were to prevail, we believe the amount of the estimated tax liability is fully reserved. We cannot predict the timing or ultimate outcome of a final resolution of the remaining unresolved issues.

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Tax Years Prior to 2000

The previous examination cycle included the consolidated income tax groups for the audit periods identified below:

Coltec Industries Inc. and Subsidiaries	December, 1997 — July, 1999 (through date of acquisition)
Goodrich Corporation and Subsidiaries	1998 — 1999 (including Rohr, Inc. (Rohr) and Coltec)

We previously reached final settlement with the IRS on all but one of the issues raised in this examination cycle. We received statutory notices of deficiency dated June 14, 2007 related to the remaining unresolved issue which involves the proper timing of certain deductions. We filed a petition with the U.S. Tax Court in September 2007 to contest the notices of deficiency.

In December 2010, we reached a tentative agreement with the IRS to settle the remaining unresolved issue but due to the size of the potential refund, the agreement required approval by the Joint Committee on Taxation (JCT). In January 2011, the JCT approved the terms of the settlement agreement. In March 2011, the U.S. Tax Court accepted the terms of the settlement agreement and agreed to the litigants’ request to dismiss the matter. We recognized a tax benefit of approximately $21 million in the three months ended March 31, 2011.

Rohr was examined by the State of California for the tax years ended July 31, 1985, 1986 and 1987. The State of California disallowed certain expenses incurred by one of Rohr’s subsidiaries in connection with the lease of certain tangible property. California’s Franchise Tax Board held that the deductions associated with the leased equipment were non-business deductions. In addition, California audited our amended tax returns filed to reflect the changes resulting from the settlement of the U.S. Tax Court for Rohr’s tax years 1986 to 1997.California issued an assessment based on numerous issues including proper timing of deductions and allowance of tax credits. In October 2010, a comprehensive settlement was reached with the California Tax Board addressing all issues for tax years 1985 through 2001. We recognized a tax benefit of approximately $23 million in the three months ended December 31, 2010.

CRITICAL ACCOUNTING POLICIES

Our discussion and analysis of our financial condition and results of operations is based upon our condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the U.S. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates, including those related to customer programs and incentives, product returns, bad debts, inventories, investments, goodwill and intangible assets, income taxes, financing obligations, warranty obligations, excess component order cancellation costs, restructuring, long-term service contracts, share-based compensation, pensions and

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other postretirement benefits, and contingencies and litigation. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

We believe the following critical accounting policies affect our more significant judgments and estimates used in the preparation of our condensed consolidated financial statements.

Contract Accounting — Percentage of Completion

We have sales under long-term contracts, many of which contain escalation clauses, requiring delivery of products over several years and frequently providing the buyer with option pricing on follow-on orders. Sales and profits on each contract are recognized in accordance with the percentage-of-completion method of accounting, primarily using the units-of-delivery method. We use the cumulative catch-up method in accounting for changes in estimates. Under the cumulative catch-up method, the impact of changes in estimates related to units shipped to date is recognized immediately when changes in estimated contract profitability are known. Amounts representing contract claims or change orders are considered in estimating revenues, costs and profits when they can be reliably estimated and realization is considered probable.

Estimates of revenue and cost for our contracts span a period of many years from the inception of the contracts to the date of actual shipments and are based on a substantial number of underlying assumptions. We believe that the underlying factors are sufficiently reliable to provide a reasonable estimate of the profit to be generated. However, due to the significant length of time over which revenue streams will be generated, the variability of the assumptions of the revenue and cost streams can be significant if the factors change. The risk factors include but are not limited to estimates of the following:

• Escalation of future sales prices under the contracts;

• Ability to recover costs incurred for change orders and claims;

• Costs, including material and labor costs and related escalation;

• Labor improvements due to the learning curve experience;

• Anticipated cost productivity improvements, including overhead absorption, related to new, or changes to, manufacturing methods and processes;

• Supplier pricing, including escalation where applicable, potential supplier claims, the supplier’s financial viability and the supplier’s ability to perform;

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• The cost impact of product design changes that frequently occur during the flight test and certification phases of a program; and

• Effect of foreign currency exchange fluctuations.

Inventory

Inventoried costs on long-term contracts include certain pre-production costs, consisting primarily of tooling and design costs and production costs, including applicable overhead. The costs attributed to units delivered under long-term commercial contracts are based on the estimated average cost of all units expected to be produced and are determined under the learning curve concept, which anticipates a predictable decrease in unit costs as tasks and production techniques become more efficient through repetition. During the early years of a contract, manufacturing costs per unit delivered are typically greater than the estimated average unit cost for the total contract. This excess manufacturing cost for units shipped results in an increase in inventory (referred to as “excess-over-average”) during the early years of a contract. See Note 8, “Inventories”, to our condensed consolidated financial statements.

If in-process inventory plus estimated costs to complete a specific contract exceed the anticipated remaining sales value of such contract, such excess is charged to cost of sales in the period identified, thus reducing inventory to its estimated realizable value. Progress payments and advances are classified as a reduction of inventory when they represent non-refundable payments for work-in-process and cash received from government customers where the government has legal title to the work-in-process.

Unbilled Receivables

Our aerostructures business is party to a long-term supply arrangement whereby we receive cash payments for our performance over a period that extends beyond our performance period of the contract. The contract is accounted for using the percentage-of-completion method of contract accounting. Unbilled receivables include revenue recognized that will be realized from cash payments to be received beyond the period of performance. In estimating our revenues to be received under the contract, cash receipts that are expected to be received beyond the performance period are included at their present value as of the end of the performance period.

Product Maintenance Arrangements

We have entered into long-term product maintenance arrangements to provide specific products and services to customers for a specified amount per flight hour, brake landing and/or aircraft landings. Revenue is recognized as the service is performed and the costs are incurred. We have sufficient historical evidence that indicates that the costs of performing the service under the contract are incurred on other than a straight line basis.

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Income Taxes

As of each reporting period, we estimate an effective income tax rate that is expected to be applicable for the full fiscal year. In addition, we establish reserves for uncertain tax positions and record interest (net of any applicable tax benefit) on potential tax contingencies as a component of our tax expense. The estimate of our effective income tax rate involves significant judgments regarding the application of complex tax regulations across many jurisdictions and estimates as to the amount and jurisdictional source of income expected to be earned during the full fiscal year. Further influencing this estimate are evolving interpretations of new and existing tax laws, rulings by taxing authorities and court decisions. Due to the subjective and complex nature of these underlying issues, our actual effective tax rate and related tax liabilities may differ from our initial estimates. Differences between our estimated and actual effective income tax rates and related liabilities are recorded in the period they become known. The resulting adjustment to our income tax expense could have a material effect on our results of operations in the period the adjustment is recorded.

Goodwill and Identifiable Intangible Assets

Goodwill is not amortized but is tested for impairment annually, or when an event occurs or circumstances change such that it is reasonably possible that an impairment may exist. Our annual testing date is November 30. We test goodwill for impairment by first comparing the book value of net assets to the fair value of the related reporting units. If the fair value is determined to be less than book value, a second step is performed to compute the amount of the impairment. In this process, a fair value for goodwill is estimated, based in part on the fair value of the operations, and is compared to its carrying value. The amount of the fair value below carrying value represents the amount of goodwill impairment.

We estimate the fair values of the reporting units using discounted cash flows. Forecasts of future cash flows are based on our best estimate of future sales and operating costs, based primarily on existing firm orders, expected future orders, contracts with suppliers, labor agreements and general market conditions. Changes in these forecasts could significantly change the amount of impairment recorded, if any impairment exists. The cash flow forecasts are adjusted by a long-term growth rate and a discount rate derived from our weighted-average cost of capital at the date of evaluation.

Impairments of identifiable intangible assets are recognized when events or changes in circumstances indicate that the carrying amount of the asset or related groups of assets may not be recoverable, and our estimate of undiscounted cash flows over the assets’ remaining useful lives is less than the carrying value of the assets. The determination of undiscounted cash flow is based on our segments’ plans. The revenue growth is based upon aircraft build projections from aircraft manufacturers and widely available external publications. The profit margin assumption is based upon the current cost structure and

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anticipated cost reductions. Changes to these assumptions could result in the recognition of impairment.

Other Assets

As with any investment, there are risks inherent in recovering the value of participation payments, sales incentives and flight certification costs. Such risks are consistent with the risks associated with acquiring a revenue-producing asset in which market conditions may change or the risks that arise when a manufacturer of a product on which a royalty is based has business difficulties and cannot produce the product. Such risks include but are not limited to the following:

• Changes in market conditions that may affect product sales under the program, including market acceptance and competition from others;

• Performance of subcontract suppliers and other production risks;

• Bankruptcy or other less significant financial difficulties of other program participants, including the aircraft manufacturer, the OEM and other program suppliers or the aircraft customer; and

• Availability of specialized raw materials in the marketplace.

Participation Payments

Certain of our businesses make cash payments under long-term contractual arrangements to OEM or system contractors in return for a secured position on an aircraft program. Participation payments are capitalized, when a contractual liability has been incurred, as other assets and amortized as a reduction to sales, as appropriate. At June 30, 2011 and December 31, 2010, the carrying amount of participation payments was $176.1 million and $116.7 million, respectively. The carrying amount of participation payments is evaluated for recovery at least annually or when other indicators of impairment exist, such as a change in the estimated number of units or a revision in the economics of the program. If such estimates change, amortization expense is adjusted and/or an impairment charge is recorded, as appropriate, for the effect of the revised estimates. No such impairment charges were recorded in the six months ended June 30, 2011 or 2010.

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Sales Incentives

We offer sales incentives such as up-front cash payments, merchandise credits and/or free products to certain airline customers in connection with sales contracts. The cost of these incentives is recognized in the period incurred unless recovery of these costs is specifically guaranteed by the customer in the contract. If the contract contains such a guarantee, then the cost of the sales incentive is capitalized as other assets and amortized to cost of sales, or as a reduction to sales, as appropriate. At June 30, 2011 and December 31, 2010, the carrying amount of sales incentives was $56.8 million and $55.6 million, respectively. The carrying amount of sales incentives is evaluated for recovery when indicators of potential impairment exist. The carrying value of the sales incentives is also compared annually to the amount recoverable under the terms of the guarantee in the customer contract. If the amount of the carrying value of the sales incentives exceeds the amount recoverable in the contract, the carrying value is reduced. No such impairment charges were recorded in the six months ended June 30, 2011 or 2010.

Flight Certification Costs

When a supply arrangement is secured, certain of our businesses may agree to supply hardware to an OEM to be used in flight certification testing and/or make cash payments to reimburse an OEM for costs incurred in testing the hardware. The flight certification testing is necessary to certify aircraft systems/components for the aircraft’s airworthiness and allows the aircraft to be flown and thus sold in the country certifying the aircraft. Flight certification costs are capitalized in other assets and are amortized to cost of sales, or as a reduction to sales, as appropriate. At June 30, 2011 and December 31, 2010, the carrying amount of sales flight certification costs was $41.8 million and $42.8 million, respectively. The carrying amount of flight certification costs is evaluated for recovery when indicators of impairment exist or when the estimated number of units to be manufactured changes. No such impairment charges were recorded in the six months ended June 30, 2011 or 2010.

Service and Product Warranties

We provide service and warranty policies on certain of our products. We accrue liabilities under service and warranty policies based upon specific claims and a review of historical warranty and service claim experience. Adjustments are made to accruals as claim data and historical experience change. In addition, we incur discretionary costs to service our products in connection with product performance issues. Our service and product warranty reserves are based upon a variety of factors. Any significant change in these factors could have a material impact on our results of operations. Such factors include but are not limited to the following:

• The historical performance of our products and changes in performance of newer products;

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• The mix and volumes of products being sold; and

• The impact of product changes.

Share-Based Compensation

We utilize the fair value method of accounting to account for share-based compensation awards. See Note 5, “Share-Based Compensation”.

Assumptions

Stock Options

We use the Black-Scholes-Merton formula to estimate the expected value that our employees will receive from the options based on a number of assumptions, such as interest rates, employee exercises, our stock price and expected dividend yield. Our weighted-average assumptions included:

	2011		2010
Risk-free interest rate %		2.2		2.9
Expected dividend yield %		1.3		1.6
Historical volatility factor %		35.6		35.0
Weighted-average expected life of the options (years)		5.6		5.7

The expected life is a significant assumption as it determines the period for which the risk-free interest rate, historical volatility and expected dividend yield must be applied. The expected life is the period over which our employees are expected to hold their options. It is based on our historical experience with similar grants. The risk-free interest rate is based on the expected U.S. Treasury rate over the expected life. Historical volatility reflects movements in our stock price over the most recent historical period equivalent to the expected life. Expected dividend yield is based on the stated dividend rate as of the date of grant.

Restricted Stock Units

The fair value of the restricted stock units is determined based upon the average of the high and low grant date fair value. The weighted-average grant date fair value during the first six months of 2011 and 2010 was $88.61 and $65.37 per unit, respectively.

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Performance Units

The value of each award is determined based upon the average of the high and low price of our stock on the last day of each reporting period, as adjusted for a performance condition and a market condition. The performance condition is applied to 50% of the awards and is based upon our actual return on invested capital (ROIC) as compared to a target ROIC. The market condition is applied to 50% of the awards and is based on our relative total shareholder return (RTSR) as compared to the RTSR of a peer group of companies. Since the awards will be paid in cash, they are recorded as a liability award and are marked to market each reporting period. As such, assumptions are evaluated for each award on an ongoing basis.

Pension and Postretirement Benefits Other Than Pensions

We consult with an outside actuary as to the appropriateness for many of the assumptions used in determining the benefit obligations and the annual expense for our worldwide pension and postretirement benefits other than pensions. All significant assumptions are evaluated at least annually. Assumptions such as the rate of compensation increase, health care cost projections, the mortality rate assumption, and the long-term rate of return on plan assets are based upon our historical and benchmark data, as well as our outlook for the future. The U.S. and the U.K. discount rates are determined using a bond settlement approach based on a hypothetical portfolio of high quality corporate bonds whose coupon payments and maturity values are designed to match the projected benefit payment cash flows of the underlying pension and OPEB obligations. Only high quality AA-graded or better, non-callable corporate bonds are included in this bond portfolio. The discount rate for Canada resulted from benchmark plans with similar durations as the Canadian plans, plotted against the respective Canadian yield curves of AA-graded corporate bonds. The appropriate benchmarks by applicable country are used for pension plans other than those in the U.S., U.K. and Canada.

We generally amortize the actuarial gains and losses for our pension plans over the average future service period of the active participants. However, in 2011, we are amortizing the actuarial gains and losses over the remaining life of the inactive plan participants in our U.S. salaried plan since almost all of the plan participants in that plan are now inactive. Additionally, as of January 1, 2011 we reduced the expected long-term rate of return assumption for the U.S. and U.K. plan assets to 8.25%.

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FORWARD-LOOKING INFORMATION IS SUBJECT TO RISK AND UNCERTAINTY

Certain statements made in this document are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding our future plans, objectives and expected performance. Specifically, statements that are not historical facts, including statements accompanied by words such as “believe,” “expect,” “anticipate,” “intend,” “should,” “estimate,” or “plan,” are intended to identify forward-looking statements and convey the uncertainty of future events or outcomes. We caution readers that any such forward-looking statements are based on assumptions that we believe are reasonable, but are subject to a wide range of risks, and actual results may differ materially.

Important factors that could cause actual results to differ from expected performance include, but are not limited to:

• demand for and market acceptance of new and existing products, such as the Airbus A350 XWB, A320neo and A380, the Boeing 787, the EMBRAER 190, the Mitsubishi Regional Jet (MRJ), the Bombardier CSeries, the Dassault Falcon 7X and the Lockheed Martin F-35 Lightning II and the Northrop Grumman Joint STARS re-engining program;

• our ability to maintain profitability on the aerostructures 787 OE contract with Boeing;

• our ability to extend our commercial OE contracts beyond the initial contract periods;

• cancellation or delays of orders or contracts by customers or with suppliers, including delays or cancellations associated with the Boeing 787, the Airbus A380 and A350 XWB aircraft programs, and major military programs, including the Northrop Grumman Joint STARS re-engining program and the Lockheed Martin F-35 Lightning II;

• our ability to obtain price adjustments pursuant to certain of our long-term contracts;

• the financial viability of key suppliers and the ability of our suppliers to perform under existing contracts;

• the extent to which we are successful in integrating and achieving expected operating synergies for recent and future acquisitions;

• successful development of products and advanced technologies;

• the impact of bankruptcies and/or consolidations in the airline industry;

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• the health of the commercial aerospace industry, including the large commercial, regional, business and general aviation aircraft manufacturers;

• global demand for aircraft spare parts and aftermarket services;

• changing priorities or reductions in the defense budgets in the U.S. and other countries, U.S. foreign policy and the level of activity in military flight operations;

• the possibility of restructuring and consolidation actions and the successful implementation of any announced actions;

• threats and events associated with and efforts to combat terrorism;

• the extent to which changes in regulations and/or assumptions result in changes to expenses relating to employee and retiree medical and pension benefits;

• competitive product and pricing pressures;

• our ability to recover under contractual rights of indemnification for environmental, asbestos and other claims arising out of the divestiture of our tire, vinyl, engineered industrial products and other businesses;

• the effect of changes in accounting policies or legislation, including tax legislation;

• cumulative catch-up adjustments or loss contract reserves on long-term contracts accounted for under the percentage of completion method of accounting;

• domestic and foreign government spending, budgetary and trade policies;

• economic and political changes in international markets where we compete, such as changes in currency exchange rates, interest rates, inflation, fuel prices, deflation, recession and other external factors over which we have no control;

• the outcome of contingencies including completion of acquisitions, joint ventures, divestitures, tax audits, litigation and environmental remediation efforts; and

• the impact of labor difficulties or work stoppages at our, a customer’s or a supplier’s facilities.

We caution you not to place undue reliance on the forward-looking statements contained in this document, which speak only as of the date on which such statements are made. We undertake no obligation to release publicly any revisions to these forward-looking statements to reflect events or circumstances after the date on which such statements were made or to reflect the occurrence of unanticipated events.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

We are exposed to certain market risks as part of our ongoing business operations, including risks from changes in interest rates and foreign currency exchange rates, which could impact our financial condition, results of operations and cash flows. We manage our exposure to these and other market risks through regular operating and financing activities and through the use of derivative financial instruments. We use such derivative financial instruments as risk management tools and not for speculative investment purposes.

We are exposed to interest rate risk as a result of our outstanding variable rate debt obligations. At June 30, 2011, a hypothetical 100 basis point unfavorable change in interest rates would increase annual interest expense by $0.8 million. At June 30, 2011, a hypothetical 10 percent strengthening of the U.S. dollar against other foreign currencies would decrease the value of our forward contracts by $215.4 million. The fair value of these foreign currency forward contracts was an asset of $118.9 million at June 30, 2011. Because we hedge only a portion of our exposure, a strengthening of the U.S. Dollar as described above would have a more than offsetting benefit to our financial results in future periods.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our Chairman, President and Chief Executive Officer and Executive Vice President and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. Management necessarily applied its judgment in assessing the costs and benefits of such controls and procedures, which, by their nature, can provide only reasonable assurance regarding management’s disclosure control objectives.

We have carried out an evaluation, under the supervision and with the participation of our management, including our Chairman, President and Chief Executive Officer and Executive Vice President and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by the Quarterly Report (the Evaluation Date). Based upon that evaluation, our Chairman, President and Chief Executive Officer and Executive Vice President and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of the Evaluation Date to provide reasonable assurance regarding management’s disclosure control objectives.

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Changes in Internal Control

During our most recent fiscal quarter, we implemented an ERP system at the majority of our sensors and integrated systems businesses as part of our previously disclosed plan for an integrated ERP system across the Company. There were no other changes in our internal control over financial reporting that occurred during our most recent fiscal quarter that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings.

We and certain of our subsidiaries are defendants in various claims, lawsuits and administrative proceedings. In addition, we have been notified that we are among potentially responsible parties under federal environmental laws, or similar state laws, relative to the cost of investigating and in some cases remediating contamination by hazardous materials. See the disclosure under the captions “General”, “Environmental”, “Asbestos”, “Liabilities of Divested Businesses” and “Tax” in Note 15, “Contingencies” to the condensed consolidated financial statements included in Part 1, Item 1, of this Form 10-Q, which disclosure is incorporated herein by reference.

Item 1A. Risk Factors.

In addition to other information set forth in this report, you should carefully consider the factors discussed in Part 1, Item 1A. “Risk Factors,” in our Annual Report on Form 10-K for the year ended December 31, 2010, which could materially affect our business, financial condition or results of operations. The risks described in our Annual Report of Form 10-K are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or results of operations.

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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

(c) The following table summarizes Goodrich Corporation’s purchases of its common stock for the three months ended June 30, 2011:

ISSUER PURCHASES OF EQUITY SECURITIES

							(d) Maximum Number
							(or Approximate
							Dollar
							Value) of Shares
					(c) Total Number of		that May
					Shares Purchased as		Yet Be Purchased
	(a) Total Number				Part of Publicly		Under
	of Shares		(b) Average Price		Announced Plans or		the Plans or
Period	Purchased (1)		Paid Per Share		Programs (2)		Programs (3)
April 2011		7,492		85.97		—
May 2011		21,609		86.41		20,000
June 2011		21,086		85.95		20,000
Total		50,187		86.15		40,000	$	479 million

(1)	The category includes 10,187 shares delivered to us by employees to pay withholding taxes due upon vesting of a restricted unit award and to pay the exercise price of employee stock options.
(2)	This balance represents the number of shares that were repurchased under the Company’s repurchase program (the Program). The Program was approved by the Board of Directors for $1.1 billion in total. Unless terminated earlier by resolution of the Company’s Board of Directors, the Program will expire when the Company has purchased all shares authorized for repurchase. The Program does not obligate the Company to repurchase any particular amount of common stock, and may be suspended or discontinued at any time without notice.
(3)	This balance represents the value of shares that can be repurchased under the Program.

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Item 6. Exhibits.

The following exhibits have been filed with this report:

Exhibit 3.1	Restated Certificate of Incorporation of Goodrich Corporation, filed as Exhibit 3.1 to Goodrich Corporation’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2003 (File No. 1-892), is incorporated herein by reference.
Exhibit 3.2	By-Laws of Goodrich Corporation, as amended, filed as Exhibit 3.1 to Goodrich Corporation’s Current Report on Form 8-K dated February 16, 2011, is incorporated herein by reference. In accordance with Item 601(b)(4)(iii)(A) of Regulation S-K, Goodrich Corporation hereby undertakes to furnish to the Securities and Exchange Commission upon request, a copy of all instruments defining the rights of holders of long-term debt.
Exhibit 15	Letter Re: Unaudited Interim Financial Information.
Exhibit 31.1	Rule 13a-14(a)/15d-14(a) Certification.
Exhibit 31.2	Rule 13a-14(a)/15d-14(a) Certification.
Exhibit 32	Section 1350 Certifications.
Exhibit 101	The following financial information from Goodrich Corporation’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2011 filed with the SEC on July 22, 2011, formatted in XBRL includes: (i) Condensed Consolidated Income Statements for the fiscal periods ended June 30, 2011 and June 30, 2010, (ii) Condensed Consolidated Balance Sheets at June 30, 2011 and December 31, 2010, (iii) Condensed Consolidated Cash Flow Statements for the fiscal periods ended June 30, 2011 and June 30, 2010, and (iv) the Notes to the Condensed Consolidated Financial Statements.

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SIGNATURE

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.

July 22, 2011

GOODRICH CORPORATION
By	/s/ SCOTT E. KUECHLE
	Scott E. Kuechle
	Executive Vice President and Chief Financial Officer
By	/s/ SCOTT A. COTTRILL
	Scott A. Cottrill
	Vice President and Controller (Principal Accounting Officer)

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EXHIBIT INDEX

Exhibit 3.1	Restated Certificate of Incorporation of Goodrich Corporation, filed as Exhibit 3.1 to Goodrich Corporation’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2003 (File No. 1-892), is incorporated herein by reference.
Exhibit 3.2	By-Laws of Goodrich Corporation, as amended, filed as Exhibit 3.1 to Goodrich Corporation’s Current Report on Form 8-K dated February 16, 2011, is incorporated herein by reference. In accordance with Item 601(b)(4)(iii)(A) of Regulation S-K, Goodrich Corporation hereby undertakes to furnish to the Securities and Exchange Commission upon request, a copy of all instruments defining the rights of holders of long-term debt.
Exhibit 15	Letter Re: Unaudited Interim Financial Information.*
Exhibit 31.1	Rule 13a-14(a)/15d-14(a) Certification.*
Exhibit 31.2	Rule 13a-14(a)/15d-14(a) Certification.*
Exhibit 32	Section 1350 Certifications.*
Exhibit 101	The following financial information from Goodrich Corporation’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2011 filed with the SEC on July 22, 2011, formatted in XBRL includes: (i) Condensed Consolidated Income Statements for the fiscal periods ended June 30, 2011 and June 30, 2010, (ii) Condensed Consolidated Balance Sheets at June 30, 2011 and December 31, 2010, (iii) Condensed Consolidated Cash Flow Statements for the fiscal periods ended June 30, 2011 and June 30, 2010, and (iv) the Notes to the Condensed Consolidated Financial Statements.*

* Submitted electronically herewith.

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EX-15

Exhibit 15 — Letter Re: Unaudited Interim Financial Information

To the Shareholders and Board of Directors of Goodrich Corporation

We are aware of the incorporation by reference in the following Registration Statements and in their related Prospectuses, of our report dated July 22, 2011 relating to the unaudited condensed consolidated interim financial statements of Goodrich Corporation that are included in its Form 10-Q for the quarter ended June 30, 2011:

Registration
Number	Description of Registration Statement	Filing Date
333-53879	Directors’ Deferred Compensation Plan — Form S-8	May 29, 1998
333-77023	The B.F.Goodrich Company Stock Option Plan and Goodrich Corporation 2001 Equity Compensation Plan — Form S-8	April 26, 1999
333-60210	Goodrich Corporation Stock Option Plan — Form S-8	May 4, 2001
333-60208	Goodrich Corporation Employee Stock Purchase Plan — Form S-8	May 4, 2001
333-98165	Shelf Registration for Debt Securities, Series Preferred Stock, Common Stock, Stock Purchase Contracts and Stock Purchase Units — Form S-3	August 15, 2002
333-107866	Goodrich Corporation Employees’ Savings Plan — Form S-8	August 12, 2003
333-107867	Goodrich Corporation Wage Employees’ Savings Plan — Form S-8	August 12, 2003
333-107868	Goodrich Corporation Savings Plan for Rohr Employees — Form S-8	August 12, 2003
333-109247	Goodrich Corporation Directors’ Deferred Compensation Plan — Form S-8	September 29, 2003
333-123721	Goodrich Corporation Outside Director Deferral Plan — Form S-8	March 31, 2005
333-151477	Goodrich Corporation Amended and Restated 2001 Equity Compensation Plan — Form S-8	June 6, 2008
333-151478	Goodrich Corporation 2008 Global Employee Stock Purchase Plan — Form S-8	June 6, 2008
333-154778	Goodrich Corporation Debt Securities, Series Preferred Stock, Common Stock, Stock Purchase Contracts, Stock Purchase Units — Form S-3	October 28, 2008
333-173643	Goodrich Corporation 2011 Equity Compensation Plan — Form S-8	April 21, 2011

/s/ Ernst & Young LLP

Charlotte, North Carolina
July 22, 2011

EX-31.1

Exhibit 31.1

CERTIFICATION

     I, Marshall O. Larsen, certify that:

     1. I have reviewed this Form 10-Q of Goodrich Corporation;

     2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

     3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

     4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

     (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

     (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

     (c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

     (d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

     5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

     (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

     (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: July 22, 2011	/s/ Marshall O. Larsen
	Marshall O. Larsen
	Chairman, President and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

     I, Scott E. Kuechle, certify that:

     1. I have reviewed this Form 10-Q of Goodrich Corporation;

     2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

     3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

     4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

     (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

     (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

     (c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

     (d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

     5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

     (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

     (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: July 22, 2011	/s/ Scott E. Kuechle
	Scott E. Kuechle
	Executive Vice President and Chief Financial Officer

EX-32

Exhibit 32

CERTIFICATION PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, in connection with the filing of the Quarterly Report on Form 10-Q of Goodrich Corporation (the “Company”) for the quarter ended June 30, 2011, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned officers of the Company certifies, that, to such officer’s knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods expressed in the Report.

Date: July 22, 2011

/s/ Marshall O. Larsen
Name:	Marshall O. Larsen
Title:	Chairman, President and Chief Executive Officer
/s/ Scott E. Kuechle
Name:	Scott E. Kuechle
Title:	Executive Vice President and Chief Financial Officer

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Document and Entity Information	6 Months Ended
	Jun. 30, 2011
Document and Entity Information [Abstract]
Entity Registrant Name	GOODRICH CORP
Entity Central Index Key	0000042542
Document Type	10-Q
Document Period End Date	Jun. 30, 2011
Amendment Flag	false
Document Fiscal Year Focus	2011
Document Fiscal Period Focus	Q2
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding	125,005,231

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Share-Based Compensation

6 Months Ended

Jun. 30, 2011

Share-Based Compensation [Abstract]

Share-Based Compensation

Note 5. Share-Based Compensation

During the three and six months ended June 30, 2011 and 2010, the Company expensed share-based compensation awards under the Goodrich Equity Compensation Plan and the Goodrich Corporation 2008 Global Employee Stock Purchase Plan for employees and under the Outside Director Deferral and Outside Director Phantom Share plans for non-employee directors. A detailed description of the awards under these plans is included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2010.

The compensation cost recorded for share-based compensation plans during the three months ended June 30, 2011 and 2010 was $28.6 million and $15 million, respectively. The increase from 2010 to 2011 was primarily due to changes in the Company’s share price for the performance units and Outside Director Phantom Share Plan, changes in the expected return on invested capital (ROIC) as compared to a target ROIC for the performance units and by a higher grant date fair value for the restricted stock units and stock options.

The compensation cost recorded for share-based compensation plans during the six months ended June 30, 2011 and 2010 was $46.5 million and $33.2 million, respectively. The increase from 2010 to 2011 was primarily due to a higher grant date fair value for the restricted stock units and stock options, changes in the expected ROIC as compared to a target ROIC for the performance units and changes in the Company’s share price for the performance units and Outside Director Phantom Share Plan.

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Earnings Per Share

6 Months Ended

Jun. 30, 2011

Earnings Per Share [Abstract]

Earnings Per Share

Note 6. Earnings Per Share

The computation of basic and diluted earnings per share (EPS) for income from continuing operations is as follows:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2011			2010			2011			2010
	(In millions, except per share amounts)
Numerator
Numerator for basic and diluted earnings per common share — income from continuing operations attributable to Goodrich	$	176.6		$	158.9		$	371.4		$	268.9
Percentage allocated to common shareholders (1)		98.6	%		98.6	%		98.6	%		98.6	%
Numerator for basic and diluted earnings per common share	$	174.1		$	156.8		$	366.2		$	265.2
Denominator
Denominator for basic earnings per common share — weighted-average shares		124.9			125.4			125.1			125.2
Effect of dilutive securities:
Stock options, employee stock purchase plan and other deferred compensation shares		1.0			1.1			1.0			1.2
Denominator for diluted earnings per common share — adjusted weighted-average shares and assumed conversion		125.9			126.5			126.1			126.4
Per common share income from continuing operations
Basic	$	1.39		$	1.25		$	2.93		$	2.12
Diluted	$	1.38		$	1.24		$	2.90		$	2.10

(1) Basic weighted-average common shares outstanding	124.9		125.4		125.1		125.2
Basic weighted-average common shares outstanding and unvested restricted share units expected to vest	126.7		127.1		126.9		126.9
Percentage allocated to common shareholders	98.6	%	98.6	%	98.6	%	98.6	%

The Company’s unvested restricted share units contain rights to receive nonforfeitable dividend equivalents, and thus, are participating securities requiring the two-class method of computing EPS. The calculation of EPS for common stock shown above excludes the income attributable to the unvested restricted share units from the numerator and excludes the dilutive impact of those units from the denominator.

At June 30, 2011 and 2010, the Company had 3.5 million and 4.2 million, respectively, of outstanding stock options. Stock options are included in the diluted earnings per share calculation using the treasury stock method, unless the effect of including the stock options would be anti-dilutive. For the six months ended June 30, 2011 and 2010, 0.7 million anti-dilutive stock options were excluded from the diluted EPS calculation.

During the six months ended June 30, 2011 and 2010, the Company issued 1.2 million and 2 million, respectively, of shares of common stock pursuant to stock option exercises and other share-based compensation plans.

The Company’s share repurchase program was approved by the Board of Directors for $1.1 billion in total. During the six months ended June 30, 2011 and 2010, the Company repurchased 1 million and 0.9 million shares, respectively. From inception of the program through June 30, 2011, the Company has repurchased 9.8 million shares for approximately $621 million under its share repurchase program.

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Fair Value Measurements

6 Months Ended

Jun. 30, 2011

Fair Value Measurements [Abstract]

Fair Value Measurements

Note 7. Fair Value Measurements

The Company defines fair value as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The following three levels of inputs are used to measure fair value:

Level 1 — quoted prices in active markets for identical assets and liabilities.

Level 2 — observable inputs other than quoted prices in active markets for identical assets and liabilities.

Level 3 — unobservable inputs in which there is little or no market data available, which require the reporting entity to develop its own assumptions.

The Company’s financial assets and (liabilities) measured at fair value on a recurring basis were, in millions, as follows:

	Fair Value										Fair Value
	June 30,										December 31,
	2011			Level 1		Level 2			Level 3		2010			Level 1		Level 2			Level 3
Cash Equivalents (1)	$	—		$	—	$	—		$	—	$	596.2		$	596.2	$	—		$	—
Derivative Financial Instruments (2)
Cash Flow Hedges		118.9			—		118.9			—		30.6			—		30.6			—
Other Forward Contracts		(1.0	)		—		(1.0	)		—		(0.2	)		—		(0.2	)		—
Rabbi Trust Assets (3)		60.9			60.9		—			—		55.3			55.3		—			—
Long-term debt (4)		(2,591.9	)		—		(2,591.9	)		—		(2,531.8	)		—		(2,531.8	)		—

(1)	Because of their short maturities, the carrying value of these assets approximates fair value.
(2)	See Note 17, “Derivatives and Hedging Activities”. Estimates of the fair value of the derivative financial instruments represent the Company’s best estimates based on its valuation models, which incorporate industry data and trends and relevant market rates and transactions.
(3)	Rabbi trust assets include mutual funds and cash equivalents for payment of certain non-qualified benefits for retired, terminated and active employees. The fair value of these assets was based on quoted market prices.
(4)	The carrying amount of the Company’s long-term debt was $2,371.8 million and $2,339.6 million at June 30, 2011 and December 31, 2010, respectively. The fair value of long-term debt is based on quoted market prices or on rates available to the Company for debt with similar terms and maturities.

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Inventories

6 Months Ended

Jun. 30, 2011

Inventories [Abstract]

Inventories

Note 8. Inventories

Inventories consist of the following:

	June 30,			December 31,
	2011			2010
	(Dollars in millions)
Average or actual cost (which approximates current costs):
Finished products	$	223.3		$	224.4
In-process		2,123.5			1,866.1
Raw materials and supplies		760.7			692.8
		3,107.5			2,783.3
Less:
Reserve to reduce certain inventories to LIFO basis		(53.7	)		(52.7	)
Progress payments and advances		(366.5	)		(281.2	)
Total	$	2,687.3		$	2,449.4

In-process inventory included $1,309.8 million and $1,154.2 million at June 30, 2011 and December 31, 2010, respectively, for the following: (1) pre-production and excess-over-average inventory accounted for under long-term contract accounting; and (2) engineering costs recoverable under long-term contractual arrangements. The June 30, 2011 balance of $1,309.8 million included $641.4 million related to the Boeing 787, $265.9 million related to the Airbus A350 XWB and $225.1 million related to the Pratt and Whitney PurePower^® PW 1000G engine contracts.

The Company uses the last-in, first-out (LIFO) cost method of valuing inventory for certain of the Company’s legacy aerospace manufacturing businesses, primarily the aircraft wheels and brakes business in the Actuation and Landing Systems segment. An actual valuation of inventory under the LIFO method can be made only at the end of each year based on the inventory levels and costs at that time.

Progress payments and advances represent (1) non-refundable payments for work-in-process and (2) cash received from government customers where the government has legal title to the work-in-process.

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Goodwill

6 Months Ended

Jun. 30, 2011

Goodwill [Abstract]

Goodwill

Note 9. Goodwill

The changes in the carrying amount of goodwill by segment were as follows:

						Foreign
	Balance					Currency		Balance
	December 31,		Business			Translation/		June 30,
	2010		Combinations			Other		2011
			(Dollars in millions)
Actuation and Landing Systems(1)	$	327.7	$	213.1		$	9.9	$	550.7
Nacelles and Interior Systems(2)		591.6		(2.9	)		7.8		596.5
Electronic Systems		842.9		—			3.6		846.5
	$	1,762.2	$	210.2		$	21.3	$	1,993.7

(1)

On May 12, 2011, the Company acquired Microtecnica S.r.l. for $457.1 million in cash, net of cash acquired. Based on the Company’s preliminary purchase price allocation, $312.4 million was identifiable intangible assets primarily related to customer relationships, $213.1 million was goodwill and $106.4 million was net deferred tax liabilities primarily related to the intangible assets. The fair value of the intangible assets will be amortized over a weighted-average useful life of 27 years. Goodwill primarily represents the expected value from combining Microtecnica’s expertise in flight controls with the Company’s flight control actuation business. The goodwill related to the Microtecnica acquisition is not deductible for tax purposes. The final purchase price allocation will be based on information that provides a better estimate of the fair value of assets acquired and liabilities assumed.

(2)

On September 22, 2010, the Company acquired the cabin management assets of DeCrane Holdings Co. In the three months ended March 31, 2011, the Company finalized the purchase price which resulted in a decrease in goodwill.

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Financing Arrangements

6 Months Ended

Jun. 30, 2011

Financing Arrangements [Abstract]

Financing Arrangements

Note 10. Financing Arrangements

During the three months ended June 30, 2011, the Company entered into a new five-year unsecured committed syndicated revolving credit facility, which permits borrowings up to a maximum of $700 million. In connection with entering into the new facility, the Company terminated its $500 million unsecured committed syndicated revolving credit facility that otherwise would have expired in May 2012. The new credit facility expires in May 2016. Interest rates under the new facility vary depending upon:

• The amount borrowed;

• The Company’s public debt rating by Standard & Poor’s, Moody’s and Fitch; and

• At the Company’s option, rates tied to the agent bank’s prime rate or, for U.S. Dollar and Great Britain Pounds Sterling borrowings, the London Interbank Offered Rate and for Euro borrowings, the Euro Interbank Offered Rate.

At June 30, 2011, there were $32 million in borrowings and $45.5 million in letters of credit outstanding under the facility. At December 31, 2010, there were no borrowings and $62.5 million in letters of credit outstanding under the facility. In order to be eligible to borrow under the facility, the Company must be in compliance with a maximum leverage ratio covenant and other standard covenants. The Company is currently in compliance with all covenants. At June 30, 2011, the Company had borrowing capacity under this facility of $622.5 million, after reductions for borrowings and letters of credit outstanding under the facility.

At June 30, 2011, the Company also maintained $75 million of uncommitted U.S. working capital facilities and $178.1 million of uncommitted and committed foreign working capital facilities with various banks to meet short-term borrowing requirements. At June 30, 2011 and December 31, 2010, there were $36.1 million and $4.1 million, respectively, in borrowings and $22.9 million in letters of credit and bank guarantees outstanding under these facilities. These credit facilities are provided by a small number of commercial banks that also provide the Company with committed credit through the syndicated revolving credit facility described above and with various cash management, trust and other services.

At June 30, 2011, the Company had letters of credit and bank guarantees of $108.3 million, inclusive of letters of credit outstanding under the Company’s syndicated revolving credit facility, uncommitted U.S. working capital facilities and uncommitted and committed foreign working capital facilities, as discussed above.

Long-term Debt

Long-term debt and capital lease obligations, excluding current maturities, consisted of:

	June 30,		December 31,
	2011		2010
	(Dollars in millions)
Medium-term notes payable (interest rates from 6.8% to 8.7%)	$	398.9	$	398.9
6.29% senior notes, maturing in 2016		294.6		295.0
6.125% senior notes, maturing in 2019		298.2		298.1
4.875% senior notes, maturing in 2020		299.4		299.4
3.6% senior notes, maturing in 2021		598.8		598.8
6.80% senior notes, maturing in 2036		234.1		233.7
7.0% senior notes, maturing in 2038		199.2		199.2
Other debt, maturing through 2020 (interest rates from 0.2% to 2.5%)		48.6		16.5
		2,371.8		2,339.6
Capital lease obligations		12.8		13.2
Total	$	2,384.6	$	2,352.8

Lease Commitments

The Company leases certain of its office and manufacturing facilities, machinery and equipment and corporate aircraft under various committed lease arrangements provided by financial institutions. Future minimum lease payments under operating leases were $213.9 million at June 30, 2011.

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Pensions and Postretirement Benefits Other Than Pensions

6 Months Ended

Jun. 30, 2011

Pensions and Postretirement Benefits Other Than Pensions [Abstract]

Pensions and Postretirement Benefits Other Than Pensions

Note 11. Pensions and Postretirement Benefits Other Than Pensions

Pensions

The following table sets forth the components of net periodic benefit cost and the weighted-average assumptions used to determine the net periodic benefit cost. The net periodic benefit cost for divested or discontinued operations retained by the Company is included in the amounts below:

	U.S. Plans						U.K. Plans						Other Plans
	Three Months Ended						Three Months Ended						Three Months Ended
	June 30,						June 30,						June 30,
	2011			2010			2011			2010			2011			2010
	(Dollars in millions)
Service cost	$	12.2		$	11.4		$	4.4		$	3.6		$	2.0		$	1.2
Interest cost		42.5			42.1			10.4			9.5			2.3			1.7
Expected return on plan assets		(52.1	)		(47.9	)		(15.5	)		(12.7	)		(2.2	)		(1.8	)
Amortization of prior service cost		1.4			1.7			(0.2	)		(0.2	)		0.1			0.1
Amortization of actuarial loss		13.2			28.2			(0.4	)		0.7			0.7			0.4
Gross periodic benefit cost		17.2			35.5			(1.3	)		0.9			2.9			1.6
Settlement loss		0.2			—			—			—			—			—
Curtailment loss(1)		1.4			—			—			—			—			—
Net periodic benefit cost	$	18.8		$	35.5		$	(1.3	)	$	0.9		$	2.9		$	1.6
Termination benefit charge(1)	$	4.0		$	—		$	—		$	—		$	—		$	—

	U.S. Plans						U.K. Plans						Other Plans
	Six Months Ended						Six Months Ended						Six Months Ended
	June 30,						June 30,						June 30,
	2011			2010			2011			2010			2011			2010
	(Dollars in millions)
Service cost	$	24.4		$	23.1		$	8.6		$	7.7		$	3.7		$	2.4
Interest cost		85.6			84.3			21.2			19.3			4.3			3.5
Expected return on plan assets		(104.7	)		(93.8	)		(30.9	)		(25.9	)		(4.3	)		(3.5	)
Amortization of prior service cost		3.0			3.5			(0.3	)		(0.3	)		0.2			0.1
Amortization of actuarial loss		28.8			58.4			—			1.3			1.3			0.8
Gross periodic benefit cost		37.1			75.5			(1.4	)		2.1			5.2			3.3
Settlement loss		0.2			—			—			—			—			—
Curtailment loss(1)		1.4			—			—			—			—			—
Net periodic benefit cost	$	38.7		$	75.5		$	(1.4	)	$	2.1		$	5.2		$	3.3
Termination benefit charge(1)	$	4.0		$	—		$	0.7		$	—		$	—		$	—

(1) Due to the approval of a plan to close a U.S. facility, pension assumptions were reevaluated on June 7, 2011 for the remeasurement of a U.S. Wage Plan covering certain union employees. See Note 3, “Business Segment Information”. The facility closure resulted in a curtailment loss of $1.4 million and a contractual termination benefit charge of $4 million.

The following table provides the weighted-average assumptions used to determine the net periodic benefit cost.

	U.S. Plans						U.K. Plans						Other Plans
	Three and Six Months						Three and Six Months						Three and Six Months
	Ended June 30,						Ended June 30,						Ended June 30,
	2011			2010			2011			2010			2011			2010
Discount rate 1/1 — 6/6		5.67	%		5.90	%		5.81	%		5.88	%		5.20	%		5.75	%
Discount rate 6/7 — 6/30		5.63	%		5.90	%		5.81	%		5.88	%		5.20	%		5.75	%
Expected long-term rate of return on assets		8.25	%		8.75	%		8.25	%		8.50	%		8.08	%		8.32	%
Rate of compensation increase		4.10	%		4.10	%		3.75	%		3.75	%		3.42	%		3.38	%

The Company generally amortizes the actuarial gains and losses for our pension plans over the average future service period of the active participants. However, beginning in 2011, the Company is amortizing the actuarial losses in its U.S. salaried plan over the remaining life of the inactive plan participants since almost all of the plan participants are now inactive. This resulted in a reduction in the amortization of actuarial losses from 2010 in the U.S. salaried plan.

Postretirement Benefits Other Than Pensions

The following table sets forth the components of net periodic postretirement benefit cost other than pensions. Other postretirement benefits related to the divested and discontinued operations retained by the Company are included in the amounts below.

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2011			2010			2011			2010
				(Dollars in millions)
Service cost	$	0.2		$	0.2		$	0.5		$	0.6
Interest cost		3.7			4.4			7.9			8.7
Amortization of prior service cost		(0.3	)		(0.1	)		(0.3	)		(0.1	)
Amortization of actuarial (gain) loss		—			—			—			—
Net periodic benefit cost	$	3.6		$	4.5		$	8.1		$	9.2

The following table provides the assumptions used to determine the net periodic postretirement benefit cost.

	Three and Six Months Ended June 30,
	2011		2010
Discount rate		5.29%		5.55%
Healthcare trend rate	7.5% in 2011 to 5% in 2017		7.3% in 2010 to 5% in 2015

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Comprehensive Income (Loss)

6 Months Ended

Jun. 30, 2011

Comprehensive Income (Loss) [Abstract]

Comprehensive Income (Loss)

Note 12. Comprehensive Income (Loss)

Total comprehensive income (loss) consisted of the following:

	Three Months Ended					Six Months Ended
	June 30					June 30,
	2011		2010			2011		2010
			(Dollars in millions)
Net income attributable to Goodrich	$	176.6	$	159.0		$	371.4	$	270.2
Other comprehensive income (loss):
Unrealized foreign currency translation gains (losses) during period (1)		22.5		(74.7	)		83.1		(128.0	)
Pension/OPEB liability adjustments during the period, net of tax for the three and six months ended June 30, 2011 of ($22.3) and ($28.0), respectively; net of tax for the three and six months ended June 30, 2010 of ($12.7) and ($25.8), respectively		37.2		23.3			46.0		45.0
Gain (loss) on cash flow hedges, net of tax for the three and six months ended June 30, 2011 of ($7) and ($29.7), respectively; net of tax for the three and six months ended June 30, 2010 of $26.3 and $44.3, respectively		14.0		(57.9	)		62.0		(88.5	)
Total comprehensive income (loss)	$	250.3	$	49.7		$	562.5	$	98.7

Accumulated other comprehensive income (loss) consisted of the following:

	June 30,			December 31,
	2011			2010
	(Dollars in millions)
Cumulative unrealized foreign currency translation gains, net of deferred taxes of ($1.7) and ($1.7), respectively (1)	$	222.7		$	139.6
Pension/OPEB liability adjustments, net of deferred taxes of $467.1 and $495.1, respectively		(785.5	)		(831.5	)
Accumulated gains (losses) on cash flow hedges, net of deferred taxes of ($34.3) and ($4.6), respectively		77.8			15.8
TOTAL	$	(485.0	)	$	(676.1	)

(1) No other income taxes are provided on foreign currency translation gains (losses) for comprehensive income (loss) and accumulated other comprehensive income (loss) as foreign earnings are considered permanently invested.

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Noncontrolling Interests

6 Months Ended

Jun. 30, 2011

Noncontrolling Interests [Abstract]

Noncontrolling Interests

Note 13. Noncontrolling Interests

The changes in the Company’s noncontrolling interests were as follows:

	Six months ended
	June 30,
	2011			2010
	(Dollars in millions)
Balance at January 1	$	40.9		$	46.6
Distributions to noncontrolling interests		(8.1	)		(11.3	)
Comprehensive income:
Net income attributable to noncontrolling interests		3.5			5.0
Other comprehensive income, net of tax		—			—
Comprehensive income		3.5			5.0
Balance at June 30	$	36.3		$	40.3

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Income Taxes

6 Months Ended

Jun. 30, 2011

Income Taxes [Abstract]

Income Taxes

Note 14. Income Taxes

The Company’s effective tax rate for the three months ended June 30, 2011 was 32.6%. Significant items that impacted the Company’s effective tax rate as compared to the U.S. federal statutory rate of 35% included earnings in foreign jurisdictions taxed at rates different from the statutory U.S. federal rate which reduced the effective tax rate by approximately 2 percentage points, foreign and domestic tax credits and benefits related to domestic manufacturing which reduced the effective tax rate by approximately 4 percentage points, state income taxes (net of related federal tax benefit) which increased the effective tax rate by approximately 1 percentage point and adjustments to reserves for tax contingencies, including interest thereon (net of related tax benefit), which increased the effective tax rate by approximately 1 percentage point.

The Company’s effective tax rate for the three months ended June 30, 2010 was 32.1%. Significant items that impacted the Company’s effective tax rate as compared to the U.S. federal statutory rate of 35% included earnings in foreign jurisdictions taxed at rates different from the statutory U.S. federal rate which reduced the effective tax rate by approximately 6 percentage points, foreign and domestic tax credits and benefits related to domestic manufacturing which reduced the effective tax rate by approximately 3 percentage points, deemed repatriation of non-U.S. earnings which increased the effective tax rate by approximately 2 percentage points, state income taxes (net of related tax benefit) which increased the effective tax rate by approximately 2 percentage points and adjustments to reserves for tax contingencies, including interest thereon (net of related tax benefit), which increased the effective tax rate by approximately 1 percentage point.

For the six months ended June 30, 2011, the Company reported an effective tax rate of 28.5%, including a tax settlement with the IRS for the remaining unresolved issue for tax years prior to 2000 which reduced the effective tax rate by approximately 4 percentage points. For the six months ended June 30, 2010, the Company reported an effective tax rate of 34.6%, including a charge of approximately $10 million due to the enactment of health care reform legislation in the U.S., which increased the effective tax rate by approximately 2 percentage points.

At June 30, 2011, the Company had $145.7 million of unrecognized tax benefits; however, the total amount of unrecognized benefits that, if recognized, would have affected the effective tax rate was $197.5 million. The difference relates to the impact of indirect effects including the federal benefit of state taxes and interest and penalties net of any related federal benefit as well as temporary differences which do not affect the effective tax rate. The Company recorded interest and penalties related to unrecognized tax benefits in income tax expense.

At December 31, 2010, the Company had $147.1 million of unrecognized tax benefits; however, the total amount of unrecognized benefits that, if recognized, would have affected the effective tax rate was $203.9 million. The difference relates to the impact of indirect effects including the federal benefit of state taxes and interest and penalties net of any related federal benefit as well as temporary differences which do not affect the effective tax rate.

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Condensed Consolidated Statement of Income (Unaudited) (USD $) In Millions, except Per Share data	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011	Jun. 30, 2010
Condensed Consolidated Statement of Income [Abstract]
Sales	$ 2,001.4	$ 1,717.5	$ 3,897.3	$ 3,412.7
Operating costs and expenses:
Cost of sales	1,384.2	1,172.9	2,694.7	2,377.2
Selling and administrative costs	314.3	269.3	599.4	539.2
Total operating costs and expenses	1,698.5	1,442.2	3,294.1	2,916.4
Operating Income	302.9	275.3	603.2	496.3
Interest expense	(34.5)	(33.6)	(69.1)	(67.1)
Interest income	0.3	0.3	0.6	0.4
Other income (expense) - net	(4.2)	(4.4)	(10.0)	(10.8)
Income from continuing operations before income taxes	264.5	237.6	524.7	418.8
Income tax expense	(86.2)	(76.3)	(149.8)	(144.9)
Income From Continuing Operations	178.3	161.3	374.9	273.9
Income from discontinued operations - net of income taxes		0.1		1.3
Consolidated Net Income	178.3	161.4	374.9	275.2
Net income attributable to noncontrolling interests	(1.7)	(2.4)	(3.5)	(5.0)
Net Income Attributable to Goodrich	176.6	159.0	371.4	270.2
Amounts Attributable to Goodrich:
Income from continuing operations	176.6	158.9	371.4	268.9
Income from discontinued operations - net of income taxes		0.1		1.3
Net Income Attributable to Goodrich	$ 176.6	$ 159.0	$ 371.4	$ 270.2
Basic Earnings Per Share
Continuing operations	$ 1.39	$ 1.25	$ 2.93	$ 2.12
Discontinued operations				$ 0.01
Net Income Attributable to Goodrich	$ 1.39	$ 1.25	$ 2.93	$ 2.13
Diluted Earnings Per Share
Continuing operations	$ 1.38	$ 1.24	$ 2.90	$ 2.10
Discontinued operations				$ 0.01
Net Income Attributable to Goodrich	$ 1.38	$ 1.24	$ 2.90	$ 2.11
Dividends Declared Per Common Share	$ 0.29	$ 0.27	$ 0.58	$ 0.54

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Contingencies

6 Months Ended

Jun. 30, 2011

Contingencies [Abstract]

Contingencies

Note 15. Contingencies

General

There are various pending or threatened claims, lawsuits and administrative proceedings against the Company or its subsidiaries, arising from the ordinary course of business which seek remedies or damages. Although no assurance can be given with respect to the ultimate outcome of these matters, the Company believes that any liability that may finally be determined with respect to commercial and non-asbestos product liability claims should not have a material effect on its consolidated financial position, results of operations or cash flows. Legal costs are expensed as incurred.

Environmental

The Company is subject to environmental laws and regulations which may require that the Company investigate and remediate the effects of the release or disposal of materials at sites associated with past and present operations. At certain sites, the Company has been identified as a potentially responsible party under the federal Superfund laws and comparable state laws. The Company is currently involved in the investigation and remediation of a number of sites under applicable laws.

Estimates of the Company’s environmental liabilities are based on current facts, laws, regulations and technology. These estimates take into consideration the Company’s prior experience and professional judgment of the Company’s environmental specialists. Estimates of the Company’s environmental liabilities are further subject to uncertainties regarding the nature and extent of site contamination, the range of remediation alternatives available, evolving remediation standards, imprecise engineering evaluations and cost estimates, the extent of corrective actions that may be required and the number and financial condition of other potentially responsible parties, as well as the extent of their responsibility for the remediation.

Accordingly, as investigation and remediation proceed, it is likely that adjustments in the Company’s accruals will be necessary to reflect new information. The amounts of any such adjustments could have a material adverse effect on the Company’s results of operations or cash flows in a given period. Based on currently available information, however, the Company does not believe that future environmental costs in excess of those accrued with respect to sites for which the Company has been identified as a potentially responsible party are likely to have a material adverse effect on the Company’s financial condition.

Environmental liabilities are recorded when the liability is probable and the costs are reasonably estimable, which generally is not later than at completion of a feasibility study or when the Company has recommended a remedy or has committed to an appropriate plan of action. The liabilities are reviewed periodically and, as investigation and remediation proceed, adjustments are made as necessary. Liabilities for losses from environmental remediation obligations do not consider the effects of inflation and anticipated expenditures are not discounted to their present value. The liabilities are not reduced by possible recoveries from insurance carriers or other third parties, but do reflect anticipated allocations among potentially responsible parties at federal Superfund sites or similar state-managed sites, third party indemnity obligations or contractual obligations, and an assessment of the likelihood that such parties will fulfill their obligations at such sites.

The changes in the carrying amount of environmental liabilities for the six months ended June 30, 2011, in millions, are as follows:

Balance at December 31, 2010	$	67.7
Accruals and adjustments		3.4
Payments		(2.8	)
Foreign currency translation and other		4.2
Balance at June 30, 2011	$	72.5

At June 30, 2011 and December 31, 2010, $17 million and $14.6 million, respectively, of the accrued liability for environmental remediation were included in current liabilities as accrued expenses. At June 30, 2011 and December 31, 2010, $33.8 million and $27.3 million, respectively, was associated with ongoing operations and $38.7 million and $40.4 million, respectively, was associated with previously owned businesses.

The Company expects that it will expend present accruals over many years, and will generally complete remediation in less than 30 years at sites for which it has been identified as a potentially responsible party. This period includes operation and monitoring costs that are generally incurred over 15 to 25 years.

Certain states in the U.S. and countries globally are promulgating or proposing new or more demanding regulations or legislation impacting the use of various chemical substances by all companies. The Company continues to evaluate the potential impact, if any, of complying with such regulations and legislation.

Asbestos

The Company and some of its subsidiaries have been named as defendants in various actions by plaintiffs alleging damages as a result of exposure to asbestos fibers in products or at formerly owned facilities. The Company believes that pending and reasonably anticipated future actions are not likely to have a material adverse effect on the Company’s financial condition, results of operations or cash flows. There can be no assurance, however, that future legislative or other developments will not have a material adverse effect on the Company’s results of operations and cash flows in a given period.

Insurance Coverage

The Company maintains a comprehensive portfolio of insurance policies, including aviation products liability insurance which covers most of its products. The aviation products liability insurance typically provides first dollar coverage for defense and indemnity of third party claims.

A portion of the Company’s primary and excess layers of pre-1986 insurance coverage for third party claims, primarily related to certain long-tail toxic tort and environmental claims, was provided by certain insurance carriers who are either insolvent, undergoing solvent schemes of arrangement or in run-off. The Company has entered into settlement agreements with a number of these insurers pursuant to which the Company agreed to give up its rights with respect to certain insurance policies in exchange for negotiated payments. These settlements represent negotiated payments for the Company’s loss of insurance coverage, as it no longer has this insurance available for claims that may have qualified for coverage. The portion of these payments which related to recovery of past costs (recognized as expense in prior periods) or for which there are currently no anticipated future claims is recognized in income when the payments are received. The portion related to potential future claims is recorded as deferred settlement credits on the balance sheet.

The deferred settlement credits partially offset future costs related to insurable claims utilizing a systematic and consistent approach. The recognition of the deferred settlement credits is calculated utilizing the estimated percent of costs incurred in the current period that insurance companies would have reimbursed to the Company if insurance coverage were still in place. This approach utilizes historical claims and insurance information of the Company and is reviewed and updated at least annually.

A summary of the deferred settlement credits activity for the six months ended June 30, 2011, in millions, is as follows:

Balance at December 31, 2010	$	48.6
Proceeds from insurance settlements		0.5
Amounts recorded as reduction of costs		(2.7	)
Balance at June 30, 2011	$	46.4

The current and long-term portions of the deferred settlement credits were as follows:

	June 30,		December 31,
	2011		2010
	(Dollars in millions)
Accrued expenses	$	9.1	$	5.7
Other non-current liabilities		37.3		42.9
Total	$	46.4	$	48.6

It is not practical to estimate when the remaining deferred settlement credits are expected to be recognized. The proceeds from such insurance settlements were reported as a component of net cash provided by operating activities in the period payments were received.

Liabilities of Divested Businesses

In connection with the divestiture of the Company’s tire, vinyl and other businesses, the Company has received contractual rights of indemnification from third parties for environmental and other claims arising out of the divested businesses. Failure of these third parties to honor their indemnification obligations could have a material adverse effect on the Company’s financial condition, results of operations and cash flows.

Aerostructures Long-term Contracts

The Company’s aerostructures business in the Nacelles and Interior Systems segment has several long-term contracts in the pre-production phase including the Airbus A350 XWB, the A320neo and the Pratt and Whitney PurePower^® PW 1000G engine contracts, and in the early production phase, including the Boeing 787. These contracts are accounted for in accordance with long-term construction contract accounting.

The pre-production phase includes design of the product to meet customer specifications as well as design of the processes to manufacture the product. Also involved in this phase is securing the supply of material and subcomponents produced by third party suppliers, generally accomplished through long-term supply agreements.

Contracts in the early production phase include excess-over-average inventories, which represent the excess of current manufactured cost over the estimated average manufactured cost during the life of the contract.

Cost estimates over the lives of contracts are affected by estimates of future cost reductions including learning curve efficiencies. Because these contracts cover manufacturing periods of up to 20 years or more, there is risk associated with the estimates of future costs made during the pre-production and early production phases. These estimates may be different from actual costs due to various risk factors, including the following:

• Ability to recover costs incurred for change orders and claims;

• Costs, including material and labor costs and related escalation;

• Labor improvements due to the learning curve experience;

• Anticipated cost and/or productivity improvements, including overhead absorption, related to new, or changes to, manufacturing methods and processes;

• Supplier pricing, including escalation where applicable, potential supplier claims, the supplier’s financial viability and the supplier’s ability to perform;

• The cost impact of product design changes that frequently occur during the flight test and certification phases of a program; and

• Effect of foreign currency exchange fluctuations.

Additionally, total contract revenue is based on estimates of future units to be delivered to the customer, the ability to recover costs incurred for change orders and claims and sales price escalation, where applicable. There is a risk that there could be differences between the actual units delivered and the estimated total units to be delivered under the contract and differences in actual revenues compared to estimates. Changes in estimates could have a material impact on the Company’s results of operations and cash flows.

Provisions for estimated losses on uncompleted contracts are recorded in the period such losses are determined to the extent total estimated costs exceed total estimated contract revenues.

Aerostructures Boeing 787 Nacelle Contract

During July 2011, the Company agreed to a contract modification with Boeing on the 787 contract. The contract modification extended the duration of the contract through 2030 and did not have a material effect on our financial position, results of operations and/or cash flows. The Company’s estimate of original equipment sales on this contract is approximately $9 billion. Aftermarket sales associated with this program are not accounted for using the percentage-of-completion method of accounting.

This program is in the early production phase, with entry into service expected by the end of 2011 followed by rapidly increasing production rates shortly thereafter. For this contract to remain profitable, it will be important that assumptions are realized as currently estimated in the Company’s outlook, such as:

• Supplier pricing consistent with projected costs must be negotiated for portions of the product. These prices could be impacted by design changes, changes in material costs and availability of reliable suppliers in competitive cost countries;

• New automated equipment is being utilized to manufacture the 787 composite nacelle, which is expected to reduce costs significantly during the contract period;

• Nacelle product design changes continue to occur to improve product performance, reduce weight and lower cost. The Company expects that some of the costs for these changes will be recoverable from Boeing and also expects to have success on its various cost reduction initiatives; and

• Material and overhead cost escalation and inflation assumptions could be different than estimated.

While the Company continues to believe the contract will be profitable, it is important to note that changes to any of the current cost and/or revenue assumptions will have a significant impact on the overall profitability of the contract and could have a material impact on the Company’s results of operations in the period identified. All of the risk factors listed in “Aerostructures Long-term Contracts” above could also affect the Company’s outlook of profitability on this contract.

JSTARS Program

In 2002, Seven Q Seven, Ltd. (7Q7) was selected by Northrop Grumman Corporation to provide propulsion pods for the re-engine program for the JT3D engines used by the U.S. Air Force. The Company was selected by 7Q7 as a supplier for the inlet, thrust reverser, exhaust, EBU, strut systems and wing interface systems. As of June 30, 2011, the Company had $20.7 million (net of advances of $8.1 million) of pre-production costs and inventory related to this program.

Future program funding remains uncertain and there can be no assurance of such funding. If the program were to be cancelled, the Company would recognize an impairment.

Tax

The Company is continuously undergoing examination by the IRS as well as various state and foreign jurisdictions. The IRS and other taxing authorities routinely challenge certain deductions and credits reported by the Company on its income tax returns. See Note 14, “Income Taxes”, for additional detail.

Tax Years 2007 and 2008

In January 2011, the IRS issued a Revenue Agent’s Report (RAR) for the tax years 2007 and 2008. In February 2011, the Company submitted a protest to the Appeals Division of the IRS with respect to certain unresolved issues which involve the proper timing of deductions. Although it is reasonably possible that these matters could be resolved during the next 12 months, the timing or ultimate outcome is uncertain.

Tax Years 2005 and 2006

During 2009, the IRS issued a RAR for the tax years 2005 and 2006. In July 2009, the Company submitted a protest to the Appeals Division of the IRS with respect to certain unresolved issues which involve the proper timing of deductions. Although it is reasonably possible that these matters could be resolved during the next 12 months, the timing or ultimate outcome is uncertain.

Tax Years 2000 to 2004

During 2007, the IRS and the Company reached agreement on substantially all of the issues raised with respect to the examination of taxable years 2000 to 2004. The Company submitted a protest to the Appeals Division of the IRS with respect to the remaining unresolved issues which involve the proper timing of certain deductions. The Company and the IRS were unable to reach agreement on the remaining issues. In December 2009, the Company filed a petition in the U.S. Tax Court and in March 2010 the Company also filed a complaint in the Federal District Court. The Company believes the amount of the estimated tax liability if the IRS were to prevail is fully reserved. The Company cannot predict the timing or ultimate outcome of a final resolution of the remaining unresolved issues.

Tax Years Prior to 2000

The previous examination cycle included the consolidated income tax groups for the audit periods identified below:

Coltec Industries Inc. and Subsidiaries	December, 1997 — July, 1999 (through date of acquisition)
Goodrich Corporation and Subsidiaries	1998 — 1999 (including Rohr, Inc. (Rohr) and Coltec)

The IRS and the Company previously reached final settlement on all but one of the issues raised in this examination cycle. The Company received statutory notices of deficiency dated June 14, 2007 related to the remaining unresolved issue which involves the proper timing of certain deductions. The Company filed a petition with the U.S. Tax Court in September 2007 to contest the notices of deficiency.

In December 2010, the Company reached a tentative agreement with the IRS to settle the remaining unresolved issue but due to the size of the potential refund, the agreement required approval by the Joint Committee on Taxation (JCT). In January 2011, the JCT approved the terms of the settlement agreement. In March 2011, the U.S. Tax Court accepted the terms of the settlement agreement and agreed to the litigants’ request to dismiss the matter. The Company recognized a tax benefit of approximately $21 million in the three months ended March 31, 2011.

Rohr was examined by the State of California for the tax years ended July 31, 1985, 1986 and 1987. The State of California disallowed certain expenses incurred by one of Rohr’s subsidiaries in connection with the lease of certain tangible property. California’s Franchise Tax Board held that the deductions associated with the leased equipment were non-business deductions. In addition, California audited our amended tax returns filed to reflect the changes resulting from the settlement of the U.S. Tax Court for Rohr’s tax years 1986 to 1997.California issued an assessment based on numerous issues including proper timing of deductions and allowance of tax credits. In October 2010, a comprehensive settlement was reached with the California Tax Board addressing all issues for tax years 1985 through 2001. The Company recognized a tax benefit of approximately $23 million in the three months ended December 31, 2010.

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Guarantees

6 Months Ended

Jun. 30, 2011

Guarantees [Abstract]

Guarantees

Note 16. Guarantees

The Company extends financial and product performance guarantees to third parties. At June 30, 2011, the following environmental remediation and indemnification and financial guarantees were outstanding:

	Maximum		Carrying
	Potential		Amount of
	Payment		Liability
	(Dollars in millions)
Environmental remediation and other indemnifications (Note 15, “Contingencies”)	No Limit		$	15.1
Guarantees of residual value on leases	$	28.1	$	—
Guarantees of JV debt and other financial instruments	$	41.7	$	—

The Company has guarantees of residual values on certain lease obligations in which the Company is obligated to either purchase or remarket the assets at the end of the lease term.

The Company is guarantor on a revolving credit agreement totaling £35 million between Rolls-Royce Goodrich Engine Control Systems Limited (JV) and a financial institution. In addition, the Company guarantees the JV’s foreign exchange credit line with a notional amount of $140.7 million and a fair value asset of $5.1 million at June 30, 2011. The Company is indemnified by Rolls-Royce for 50% of the gains/losses resulting from the foreign exchange hedges.

Service and Product Warranties

The Company provides service and warranty policies on certain of its products. The Company accrues liabilities under service and warranty policies based upon specific claims and a review of historical warranty and service claim experience. Adjustments are made to accruals as claim data and historical experience change. In addition, the Company incurs discretionary costs to service its products in connection with product performance issues.

The changes in the carrying amount of service and product warranties for the six months ended June 30, 2011, in millions, are as follows:

Balance at December 31, 2010	$	148.5
Net provisions for warranties issued during the period		29.1
Net change to warranties existing at the beginning of the year		0.5
Payments		(26.4	)
Foreign currency translation and other		9.2
Balance at June 30, 2011	$	160.9

The current and long-term portions of service and product warranties were as follows:

	June 30,		December 31,
	2011		2010
	(Dollars in millions)
Accrued expenses	$	98.7	$	90.0
Other non-current liabilities		62.2		58.5
Total	$	160.9	$	148.5

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Derivatives and Hedging Activities

6 Months Ended

Jun. 30, 2011

Derivatives and Hedging Activities [Abstract]

Derivatives and Hedging Activities

Note 17. Derivatives and Hedging Activities

Cash Flow Hedges

The Company has subsidiaries that conduct a substantial portion of their business in Great Britain Pounds Sterling, Euros, Canadian Dollars, Indian Rupees and Polish Zlotys but have significant sales contracts that are denominated primarily in U.S. Dollars. Periodically, the Company enters into forward contracts to exchange U.S. Dollars for these currencies to hedge a portion of the Company’s exposure from U.S. Dollar sales.

The forward contracts described above are used to mitigate the potential volatility to earnings and cash flow arising from changes in currency exchange rates that impact the Company’s U.S. Dollar sales for certain foreign operations. The forward contracts are accounted for as cash flow hedges and are recorded in the Company’s condensed consolidated balance sheet at fair value, with the offset reflected in Accumulated Other Comprehensive Income (AOCI), net of deferred taxes. The gain or loss on the forward contracts is reported as a component of other comprehensive income (loss) (OCI) and reclassified into earnings in the same period or periods during which the hedged transactions affect earnings. The notional value of the forward contracts at June 30, 2011 and December 31, 2010 was $2,031.7 million and $2,286.5 million, respectively. As of June 30, 2011 and December 31, 2010, the total fair value before taxes of the Company’s forward contracts and the accounts in the condensed consolidated balance sheet in which the fair value amounts are included are shown below:

	June 30,		December 31,
	2011		2010
	(Dollars in millions)
Prepaid expenses and other assets	$	47.3	$	20.3
Other assets		82.3		44.6
Accrued expenses		8.4		22.7
Other non-current liabilities		2.3		11.6

The amounts recognized in OCI and reclassified from AOCI into earnings are shown below:

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2011		2010			2011		2010
			(Dollars in millions)
Amount of gain/(loss) recognized in OCI, net of tax for the three and six months ended June 30, 2011 of $(7) and $(29.7), respectively; net of tax for the three and six months ended June 30, 2010 of $26.3 and $44.3, respectively	$	14.0	$	(57.9	)	$	62.0	$	(88.5	)
Amount of gain/(loss) reclassified from AOCI into earnings	$	6.7	$	(11.7	)	$	7.9	$	(16.9	)

The total fair value of the Company’s forward contracts of a $118.9 million net asset (before deferred taxes of $34 million) at June 30, 2011, combined with $1 million of losses on previously matured hedges of intercompany sales and gains from forward contracts terminated prior to the original maturity dates, is recorded in AOCI and will be reflected in income as earnings are affected by the hedged items. As of June 30, 2011, the portion of the net $118.9 million asset that would be reclassified into earnings to offset the effect of the hedged item in the next 12 months is a gain of $38.9 million. These forward contracts mature on a monthly basis with maturity dates that range from July 2011 to December 2015. There was a de minimis amount of both ineffectiveness and hedge components excluded from the assessment of effectiveness during the three and six months ended June 30, 2011 and 2010.

Fair Value Hedges

The Company enters into interest rate swaps to increase the Company’s exposure to variable interest rates. The settlement and maturity dates on each swap are the same as those on the referenced notes. The interest rate swaps are accounted for as fair value hedges and the carrying value of the notes is adjusted to reflect the fair values of the interest rate swaps. At June 30, 2011 and December 31, 2010, the Company had no outstanding interest rate swaps. Previously terminated swaps are amortized over the life of the underlying debt and recorded as a reduction to interest expense.

Other Forward Contracts

As a supplement to the foreign exchange cash flow hedging program, the Company enters into forward contracts to manage its foreign currency risk related to the translation of monetary assets and liabilities denominated in currencies other than the relevant functional currency. These forward contracts generally mature monthly and the notional amounts are adjusted periodically to reflect changes in net monetary asset balances. Since these contracts are not designated as hedges, the gains or losses on these forward contracts are recorded in selling and administrative costs or cost of sales, as appropriate. These contracts are utilized to mitigate the earnings impact of the translation of net monetary assets and liabilities.

During the three months ended June 30, 2011, the Company recorded a transaction loss on its net monetary assets of $9.6 million, which was offset by gains on the other forward contracts described above of $4 million. During the three months ended June 30, 2010, the Company recorded a transaction gain on its monetary assets of $28.1 million, which was partially offset by losses on the other forward contracts described above of $20 million.

During the six months ended June 30, 2011, the Company recorded a transaction loss on its net monetary assets of $23.1 million, which was offset by gains on the other forward contracts described above of $14.2 million. During the six months ended June 30, 2010, the Company recorded a transaction gain on its monetary assets of $39.7 million, which was partially offset by losses on the other forward contracts described above of $32.5 million.

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New Accounting Standards Not Yet Adopted (Policies)

6 Months Ended

Jun. 30, 2011

New Accounting Standards Not Yet Adopted [Abstract]

Adoption of New Guidelines Within ASC Topic 820 And Its Impact

In May 2011, accounting guidance was issued that will be included in Accounting Standards Codification (ASC) Topic 820, “Fair Value Measurement”. This guidance amends the requirements for measuring fair value and disclosing information about fair value measurements and is effective for the Company on January 1, 2012. Upon adoption, the Company does not expect this standard to have a material impact on its financial condition or results of operations.

Adoption of New Guidelines Within ASC Topic 220 And Its Impact

In June 2011, accounting guidance was issued that will be included in ASC Topic 220, “Comprehensive Income”. This guidance eliminates the option to report other comprehensive income and its components in the statement of changes in equity. Companies can elect to present items of net income and other comprehensive income in one continuous statement or in two separate, but consecutive, statements. The Company is currently evaluating which method it will utilize to present items of net income and other comprehensive income. This presentation guidance is effective for the Company on January 1, 2012.

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Basis of Interim Financial Statements (Tables)

6 Months Ended

Jun. 30, 2011

Basis of Interim Financial Statements [Abstract]

Accrued Expenses

	June 30,		December 31,
	2011		2010
	(Dollars in millions)
Deferred revenue	$	355.5	$	274.9
Wages, vacations, pensions and other employment costs		285.5		313.2
Warranties		98.7		90.0
Postretirement benefits other than pensions		28.2		29.7
Accrued taxes		40.6		31.1
Foreign currency hedges		8.4		22.5
Other		284.3		280.4
Total	$	1,101.2	$	1,041.8

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Business Segment Information (Tables)

6 Months Ended

Jun. 30, 2011

Segment Reporting [Abstract]

Segment Financial Information

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2011			2010			2011			2010
				(Dollars in millions)
Sales:
Actuation and Landing Systems	$	736.7		$	608.1		$	1,421.0		$	1,221.2
Nacelles and Interior Systems		688.8			577.4			1,345.2			1,133.2
Electronic Systems		575.9			532.0			1,131.1			1,058.3
	$	2,001.4		$	1,717.5		$	3,897.3		$	3,412.7
Intersegment sales:
Actuation and Landing Systems	$	15.0		$	8.0		$	24.8		$	14.8
Nacelles and Interior Systems		3.2			2.9			6.0			4.8
Electronic Systems		11.6			6.0			22.5			12.7
	$	29.8		$	16.9		$	53.3		$	32.3
Operating income:
Actuation and Landing Systems(1)	$	76.5		$	60.5		$	163.0		$	129.9
Nacelles and Interior Systems		178.2			151.4			335.5			270.2
Electronic Systems		89.8			95.1			180.8			165.9
		344.5			307.0			679.3			566.0
Corporate general and administrative expenses		(36.7	)		(27.7	)		(67.6	)		(61.6	)
ERP costs		(4.9	)		(4.0	)		(8.5	)		(8.1	)
Total operating income	$	302.9		$	275.3		$	603.2		$	496.3

(1)	Acquisition of Microtecnica S.r.l
	On May 12, 2011, the Company acquired Microtecnica S.r.l. and incurred $8.1 million of acquisition-related costs which were reported in selling and administrative costs for the six months ended June 30, 2011. In addition, total assets for the Actuation and Landing Systems segment increased from $2,239.9 million at December 31, 2010 to $3,187.1 million at June 30, 2011, primarily related to this acquisition. See Note 9, “Goodwill”.
	Closure of a Landing Gear Facility
	On June 7, 2011, the Board of Directors of the Company authorized a plan to close a facility in its landing gear business. Due to declining program volumes, the Company will close the facility and incur substantially all of the costs by the end of 2012. The Company anticipates that it will incur costs in connection with this closure of approximately $37 million, of which approximately $15 million is for personnel related expenses, including severance, pension charges, outplacement services and assistance with employment transitioning, and approximately $22 million primarily related to facility closure and other costs, including accelerated depreciation, equipment dismantle and relocation costs and lease termination costs.
	During the three months ended June 30, 2011, the Company incurred $15.6 million of costs related to this closure for which $13.8 million was personnel related and $1.8 million was facility closure and other costs. $10.7 million of these costs were reported in cost of sales and $4.9 million were reported in selling and administrative costs.

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Other Income (Expense) - Net (Tables)

6 Months Ended

Jun. 30, 2011

Other Income (Expense) - Net [Abstract]

Other Income (Expense) - Net

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2011			2010			2011			2010
				(Dollars in millions)
Retiree health care expenses related to previously owned businesses	$	(2.1	)	$	(2.6	)	$	(4.7	)	$	(5.3	)
Expenses related to previously owned businesses		(2.9	)		(3.1	)		(4.5	)		(4.3	)
Equity in affiliated companies		0.8			1.1			(0.1	)		(0.8	)
Other — net		—			0.2			(0.7	)		(0.4	)
Other income (expense) — net	$	(4.2	)	$	(4.4	)	$	(10.0	)	$	(10.8	)

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Earnings Per Share (Tables)

6 Months Ended

Jun. 30, 2011

Earnings Per Share [Abstract]

Basic and Diluted Earnings Per Share

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2011			2010			2011			2010
	(In millions, except per share amounts)
Numerator
Numerator for basic and diluted earnings per common share — income from continuing operations attributable to Goodrich	$	176.6		$	158.9		$	371.4		$	268.9
Percentage allocated to common shareholders (1)		98.6	%		98.6	%		98.6	%		98.6	%
Numerator for basic and diluted earnings per common share	$	174.1		$	156.8		$	366.2		$	265.2
Denominator
Denominator for basic earnings per common share — weighted-average shares		124.9			125.4			125.1			125.2
Effect of dilutive securities:
Stock options, employee stock purchase plan and other deferred compensation shares		1.0			1.1			1.0			1.2
Denominator for diluted earnings per common share — adjusted weighted-average shares and assumed conversion		125.9			126.5			126.1			126.4
Per common share income from continuing operations
Basic	$	1.39		$	1.25		$	2.93		$	2.12
Diluted	$	1.38		$	1.24		$	2.90		$	2.10

(1) Basic weighted-average common shares outstanding	124.9		125.4		125.1		125.2
Basic weighted-average common shares outstanding and unvested restricted share units expected to vest	126.7		127.1		126.9		126.9
Percentage allocated to common shareholders	98.6	%	98.6	%	98.6	%	98.6	%

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Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2011

Fair Value Measurements [Abstract]

Fair Value Measurements

	Fair Value										Fair Value
	June 30,										December 31,
	2011			Level 1		Level 2			Level 3		2010			Level 1		Level 2			Level 3
Cash Equivalents (1)	$	—		$	—	$	—		$	—	$	596.2		$	596.2	$	—		$	—
Derivative Financial Instruments (2)
Cash Flow Hedges		118.9			—		118.9			—		30.6			—		30.6			—
Other Forward Contracts		(1.0	)		—		(1.0	)		—		(0.2	)		—		(0.2	)		—
Rabbi Trust Assets (3)		60.9			60.9		—			—		55.3			55.3		—			—
Long-term debt (4)		(2,591.9	)		—		(2,591.9	)		—		(2,531.8	)		—		(2,531.8	)		—

(1)	Because of their short maturities, the carrying value of these assets approximates fair value.
(2)	See Note 17, “Derivatives and Hedging Activities”. Estimates of the fair value of the derivative financial instruments represent the Company’s best estimates based on its valuation models, which incorporate industry data and trends and relevant market rates and transactions.
(3)	Rabbi trust assets include mutual funds and cash equivalents for payment of certain non-qualified benefits for retired, terminated and active employees. The fair value of these assets was based on quoted market prices.
(4)	The carrying amount of the Company’s long-term debt was $2,371.8 million and $2,339.6 million at June 30, 2011 and December 31, 2010, respectively. The fair value of long-term debt is based on quoted market prices or on rates available to the Company for debt with similar terms and maturities.

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Inventories (Tables)

6 Months Ended

Jun. 30, 2011

Inventories [Abstract]

Inventories

	June 30,			December 31,
	2011			2010
	(Dollars in millions)
Average or actual cost (which approximates current costs):
Finished products	$	223.3		$	224.4
In-process		2,123.5			1,866.1
Raw materials and supplies		760.7			692.8
		3,107.5			2,783.3
Less:
Reserve to reduce certain inventories to LIFO basis		(53.7	)		(52.7	)
Progress payments and advances		(366.5	)		(281.2	)
Total	$	2,687.3		$	2,449.4

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Condensed Consolidated Balance Sheet (Unaudited) (USD $) In Millions	Jun. 30, 2011	Dec. 31, 2010
Current Assets
Cash and cash equivalents	$ 518.0	$ 798.9
Accounts and notes receivable, less allowances for doubtful receivables ($ 18.2 at June 30, 2011 and $16.8 at December 31, 2010)	1,468.5	1,102.7
Inventories - net	2,687.3	2,449.4
Deferred income taxes	168.3	158.3
Prepaid expenses and other assets	88.3	68.1
Income taxes receivable	3.0	93.7
Total Current Assets	4,933.4	4,671.1
Property, plant and equipment, less accumulated depreciation ($1,939.2 at June 30, 2011 and $1,843.9 at December 31, 2010)	1,547.4	1,521.5
Goodwill	1,993.7	1,762.2
Identifiable intangible assets - net	976.4	675.8
Deferred income taxes	17.3	16.4
Other assets	788.1	624.6
Total Assets	10,256.3	9,271.6
Current Liabilities
Short-term debt	36.1	4.1
Accounts payable	710.6	514.0
Accrued expenses	1,101.2	1,041.8
Income taxes payable	69.5	2.9
Deferred income taxes	31.0	28.1
Current maturities of long-term debt and capital lease obligations	1.4	1.5
Total Current Liabilities	1,949.8	1,592.4
Long-term debt and capital lease obligations	2,384.6	2,352.8
Pension obligations	516.6	556.7
Postretirement benefits other than pensions	276.4	296.9
Long-term income taxes payable	135.9	150.7
Deferred income taxes	597.8	431.2
Other non-current liabilities	546.9	503.1
Shareholders' Equity
Common stock - $5 par value Authorized 200,000,000 shares; issued 149,418,717 shares at June 30, 2011 and 148,213,331 shares at December 31, 2010 (excluding 14,000,000 shares held by a wholly owned subsidiary)	747.1	741.1
Additional paid-in capital	1,822.3	1,751.2
Income retained in the business	2,824.9	2,527.2
Accumulated other comprehensive income (loss)	(485.0)	(676.1)
Common stock held in treasury, at cost (24,413,486 shares at June 30, 2011 and 23,259,865 shares at December 31, 2010)	(1,097.3)	(996.5)
Total Shareholders' Equity	3,812.0	3,346.9
Noncontrolling interests	36.3	40.9
Total Equity	3,848.3	3,387.8
Total Liabilities And Equity	$ 10,256.3	$ 9,271.6

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Goodwill (Tables)

6 Months Ended

Jun. 30, 2011

Goodwill [Abstract]

Changes in carrying amount of goodwill

						Foreign
	Balance					Currency		Balance
	December 31,		Business			Translation/		June 30,
	2010		Combinations			Other		2011
			(Dollars in millions)
Actuation and Landing Systems(1)	$	327.7	$	213.1		$	9.9	$	550.7
Nacelles and Interior Systems(2)		591.6		(2.9	)		7.8		596.5
Electronic Systems		842.9		—			3.6		846.5
	$	1,762.2	$	210.2		$	21.3	$	1,993.7

(1)

On May 12, 2011, the Company acquired Microtecnica S.r.l. for $457.1 million in cash, net of cash acquired. Based on the Company’s preliminary purchase price allocation, $312.4 million was identifiable intangible assets primarily related to customer relationships, $213.1 million was goodwill and $106.4 million was net deferred tax liabilities primarily related to the intangible assets. The fair value of the intangible assets will be amortized over a weighted-average useful life of 27 years. Goodwill primarily represents the expected value from combining Microtecnica’s expertise in flight controls with the Company’s flight control actuation business. The goodwill related to the Microtecnica acquisition is not deductible for tax purposes. The final purchase price allocation will be based on information that provides a better estimate of the fair value of assets acquired and liabilities assumed.

(2)

On September 22, 2010, the Company acquired the cabin management assets of DeCrane Holdings Co. In the three months ended March 31, 2011, the Company finalized the purchase price which resulted in a decrease in goodwill.

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Financing Arrangements (Tables)

6 Months Ended

Jun. 30, 2011

Financing Arrangements [Abstract]

Long-term Debt

	June 30,		December 31,
	2011		2010
	(Dollars in millions)
Medium-term notes payable (interest rates from 6.8% to 8.7%)	$	398.9	$	398.9
6.29% senior notes, maturing in 2016		294.6		295.0
6.125% senior notes, maturing in 2019		298.2		298.1
4.875% senior notes, maturing in 2020		299.4		299.4
3.6% senior notes, maturing in 2021		598.8		598.8
6.80% senior notes, maturing in 2036		234.1		233.7
7.0% senior notes, maturing in 2038		199.2		199.2
Other debt, maturing through 2020 (interest rates from 0.2% to 2.5%)		48.6		16.5
		2,371.8		2,339.6
Capital lease obligations		12.8		13.2
Total	$	2,384.6	$	2,352.8

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Pensions and Postretirement Benefits Other Than Pensions (Tables)

6 Months Ended

Jun. 30, 2011

Pensions and Postretirement Benefits Other Than Pensions [Abstract]

Net periodic benefit cost for pensions

	U.S. Plans						U.K. Plans						Other Plans
	Three Months Ended						Three Months Ended						Three Months Ended
	June 30,						June 30,						June 30,
	2011			2010			2011			2010			2011			2010
	(Dollars in millions)
Service cost	$	12.2		$	11.4		$	4.4		$	3.6		$	2.0		$	1.2
Interest cost		42.5			42.1			10.4			9.5			2.3			1.7
Expected return on plan assets		(52.1	)		(47.9	)		(15.5	)		(12.7	)		(2.2	)		(1.8	)
Amortization of prior service cost		1.4			1.7			(0.2	)		(0.2	)		0.1			0.1
Amortization of actuarial loss		13.2			28.2			(0.4	)		0.7			0.7			0.4
Gross periodic benefit cost		17.2			35.5			(1.3	)		0.9			2.9			1.6
Settlement loss		0.2			—			—			—			—			—
Curtailment loss(1)		1.4			—			—			—			—			—
Net periodic benefit cost	$	18.8		$	35.5		$	(1.3	)	$	0.9		$	2.9		$	1.6
Termination benefit charge(1)	$	4.0		$	—		$	—		$	—		$	—		$	—

	U.S. Plans						U.K. Plans						Other Plans
	Six Months Ended						Six Months Ended						Six Months Ended
	June 30,						June 30,						June 30,
	2011			2010			2011			2010			2011			2010
	(Dollars in millions)
Service cost	$	24.4		$	23.1		$	8.6		$	7.7		$	3.7		$	2.4
Interest cost		85.6			84.3			21.2			19.3			4.3			3.5
Expected return on plan assets		(104.7	)		(93.8	)		(30.9	)		(25.9	)		(4.3	)		(3.5	)
Amortization of prior service cost		3.0			3.5			(0.3	)		(0.3	)		0.2			0.1
Amortization of actuarial loss		28.8			58.4			—			1.3			1.3			0.8
Gross periodic benefit cost		37.1			75.5			(1.4	)		2.1			5.2			3.3
Settlement loss		0.2			—			—			—			—			—
Curtailment loss(1)		1.4			—			—			—			—			—
Net periodic benefit cost	$	38.7		$	75.5		$	(1.4	)	$	2.1		$	5.2		$	3.3
Termination benefit charge(1)	$	4.0		$	—		$	0.7		$	—		$	—		$	—

(1) Due to the approval of a plan to close a U.S. facility, pension assumptions were reevaluated on June 7, 2011 for the remeasurement of a U.S. Wage Plan covering certain union employees. See Note 3, “Business Segment Information”. The facility closure resulted in a curtailment loss of $1.4 million and a contractual termination benefit charge of $4 million.

Weighted-Average Assumptions used to Determine Net Periodic Benefit Cost

	U.S. Plans						U.K. Plans						Other Plans
	Three and Six Months						Three and Six Months						Three and Six Months
	Ended June 30,						Ended June 30,						Ended June 30,
	2011			2010			2011			2010			2011			2010
Discount rate 1/1 — 6/6		5.67	%		5.90	%		5.81	%		5.88	%		5.20	%		5.75	%
Discount rate 6/7 — 6/30		5.63	%		5.90	%		5.81	%		5.88	%		5.20	%		5.75	%
Expected long-term rate of return on assets		8.25	%		8.75	%		8.25	%		8.50	%		8.08	%		8.32	%
Rate of compensation increase		4.10	%		4.10	%		3.75	%		3.75	%		3.42	%		3.38	%

Net periodic postretirement benefit cost for other than pensions

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2011			2010			2011			2010
				(Dollars in millions)
Service cost	$	0.2		$	0.2		$	0.5		$	0.6
Interest cost		3.7			4.4			7.9			8.7
Amortization of prior service cost		(0.3	)		(0.1	)		(0.3	)		(0.1	)
Amortization of actuarial (gain) loss		—			—			—			—
Net periodic benefit cost	$	3.6		$	4.5		$	8.1		$	9.2

The following table provides the assumptions used to determine the net periodic postretirement benefit cost.

	Three and Six Months Ended June 30,
	2011		2010
Discount rate		5.29%		5.55%
Healthcare trend rate	7.5% in 2011 to 5% in 2017		7.3% in 2010 to 5% in 2015

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Comprehensive Income (Loss) (Tables)

6 Months Ended

Jun. 30, 2011

Comprehensive Income (Loss) [Abstract]

Total comprehensive income (loss)

	Three Months Ended					Six Months Ended
	June 30					June 30,
	2011		2010			2011		2010
			(Dollars in millions)
Net income attributable to Goodrich	$	176.6	$	159.0		$	371.4	$	270.2
Other comprehensive income (loss):
Unrealized foreign currency translation gains (losses) during period (1)		22.5		(74.7	)		83.1		(128.0	)
Pension/OPEB liability adjustments during the period, net of tax for the three and six months ended June 30, 2011 of ($22.3) and ($28.0), respectively; net of tax for the three and six months ended June 30, 2010 of ($12.7) and ($25.8), respectively		37.2		23.3			46.0		45.0
Gain (loss) on cash flow hedges, net of tax for the three and six months ended June 30, 2011 of ($7) and ($29.7), respectively; net of tax for the three and six months ended June 30, 2010 of $26.3 and $44.3, respectively		14.0		(57.9	)		62.0		(88.5	)
Total comprehensive income (loss)	$	250.3	$	49.7		$	562.5	$	98.7

Accumulated other comprehensive income (loss)

	June 30,			December 31,
	2011			2010
	(Dollars in millions)
Cumulative unrealized foreign currency translation gains, net of deferred taxes of ($1.7) and ($1.7), respectively (1)	$	222.7		$	139.6
Pension/OPEB liability adjustments, net of deferred taxes of $467.1 and $495.1, respectively		(785.5	)		(831.5	)
Accumulated gains (losses) on cash flow hedges, net of deferred taxes of ($34.3) and ($4.6), respectively		77.8			15.8
TOTAL	$	(485.0	)	$	(676.1	)

(1) No other income taxes are provided on foreign currency translation gains (losses) for comprehensive income (loss) and accumulated other comprehensive income (loss) as foreign earnings are considered permanently invested.

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Noncontrolling Interests (Tables)

6 Months Ended

Jun. 30, 2011

Noncontrolling Interests [Abstract]

Changes in the noncontrolling interests

	Six months ended
	June 30,
	2011			2010
	(Dollars in millions)
Balance at January 1	$	40.9		$	46.6
Distributions to noncontrolling interests		(8.1	)		(11.3	)
Comprehensive income:
Net income attributable to noncontrolling interests		3.5			5.0
Other comprehensive income, net of tax		—			—
Comprehensive income		3.5			5.0
Balance at June 30	$	36.3		$	40.3

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Contingencies (Table)

6 Months Ended

Jun. 30, 2011

Contingencies [Abstract]

Changes in the carrying amount of environmental remediation obligations

Balance at December 31, 2010	$	67.7
Accruals and adjustments		3.4
Payments		(2.8	)
Foreign currency translation and other		4.2
Balance at June 30, 2011	$	72.5

Deferred Settlement Credits Activity

Balance at December 31, 2010	$	48.6
Proceeds from insurance settlements		0.5
Amounts recorded as reduction of costs		(2.7	)
Balance at June 30, 2011	$	46.4

Changes in the Current and long-term portions of the deferred settlement credits

	June 30,		December 31,
	2011		2010
	(Dollars in millions)
Accrued expenses	$	9.1	$	5.7
Other non-current liabilities		37.3		42.9
Total	$	46.4	$	48.6

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Guarantees (Tables)

6 Months Ended

Jun. 30, 2011

Guarantees [Abstract]

Environmental remediation and indemnification and financial guarantees

	Maximum		Carrying
	Potential		Amount of
	Payment		Liability
	(Dollars in millions)
Environmental remediation and other indemnifications (Note 15, “Contingencies”)	No Limit		$	15.1
Guarantees of residual value on leases	$	28.1	$	—
Guarantees of JV debt and other financial instruments	$	41.7	$	—

Components of Carrying amount of service and product warranties

Balance at December 31, 2010	$	148.5
Net provisions for warranties issued during the period		29.1
Net change to warranties existing at the beginning of the year		0.5
Payments		(26.4	)
Foreign currency translation and other		9.2
Balance at June 30, 2011	$	160.9

Current and long-term portions of service and product warranties

	June 30,		December 31,
	2011		2010
	(Dollars in millions)
Accrued expenses	$	98.7	$	90.0
Other non-current liabilities		62.2		58.5
Total	$	160.9	$	148.5

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Derivatives and Hedging Activities (Tables)

6 Months Ended

Jun. 30, 2011

Derivatives and Hedging Activities [Abstract]

Fair value of forward contract recorded in balance sheet

	June 30,		December 31,
	2011		2010
	(Dollars in millions)
Prepaid expenses and other assets	$	47.3	$	20.3
Other assets		82.3		44.6
Accrued expenses		8.4		22.7
Other non-current liabilities		2.3		11.6

Amounts recognized in other comprehensive income and reclassified from AOCI into earnings

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2011		2010			2011		2010
			(Dollars in millions)
Amount of gain/(loss) recognized in OCI, net of tax for the three and six months ended June 30, 2011 of $(7) and $(29.7), respectively; net of tax for the three and six months ended June 30, 2010 of $26.3 and $44.3, respectively	$	14.0	$	(57.9	)	$	62.0	$	(88.5	)
Amount of gain/(loss) reclassified from AOCI into earnings	$	6.7	$	(11.7	)	$	7.9	$	(16.9	)

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Basis of Interim Financial Statements (Details) (USD $) In Millions, except Per Share data	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011	Jun. 30, 2010	Dec. 31, 2010
Accrued Expenses
Deferred revenue	$ 355.5		$ 355.5		$ 274.9
Wages, vacations, pensions and other employment costs	285.5		285.5		313.2
Warranties	98.7		98.7		90.0
Postretirement benefits other than pensions	28.2		28.2		29.7
Accrued taxes	40.6		40.6		31.1
Foreign currency hedges	8.4		8.4		22.5
Other	284.3		284.3		280.4
Total	1,101.2		1,101.2		1,041.8
Basis of Interim Financial Statements (Textuals) [Abstract]
Effect of change in accounting estimate on income from continuing operations before income tax	20.6	32.8	41.3	48.8
Effect of change in accounting estimate on income from continuing operations after income tax	$ 13.0	$ 20.6	$ 26.2	$ 30.6
Effect of change in accounting estimate on Earnings Per Share	$ 0.10	$ 0.16	$ 0.20	$ 0.24

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Business Segment Information (Details) (USD $) In Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011	Jun. 30, 2010
Sales:
Sales	$ 2,001.4	$ 1,717.5	$ 3,897.3	$ 3,412.7
Intersegment Sales:
Intersegment Sales	29.8	16.9	53.3	32.3
Operating Income:
Operating Income	302.9	275.3	603.2	496.3
Actuation and Landing Systems [Member]
Sales:
Sales	736.7	608.1	1,421.0	1,221.2
Intersegment Sales:
Intersegment Sales	15.0	8.0	24.8	14.8
Operating Income:
Operating Income	76.5	60.5	163.0	129.9
Nacelles and Interior Systems [Member]
Sales:
Sales	688.8	577.4	1,345.2	1,133.2
Intersegment Sales:
Intersegment Sales	3.2	2.9	6.0	4.8
Operating Income:
Operating Income	178.2	151.4	335.5	270.2
Electronic Systems [Member]
Sales:
Sales	575.9	532.0	1,131.1	1,058.3
Intersegment Sales:
Intersegment Sales	11.6	6.0	22.5	12.7
Operating Income:
Operating Income	89.8	95.1	180.8	165.9
Reportable Segment [Member]
Operating Income:
Operating Income	344.5	307.0	679.3	566.0
Unallocated Amount to Segment [Member]
Operating Income:
ERP Costs	(4.9)	(4.0)	(8.5)	(8.1)
Corporate Elimination [Member]
Operating Income:
Corporate general and administrative expenses	$ (36.7)	$ (27.7)	$ (67.6)	$ (61.6)

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Condensed Consolidated Balance Sheet (Unaudited) (Parenthetical) (USD $) In Millions, except Share data	Jun. 30, 2011	Dec. 31, 2010
Current Assets
Allowances for doubtful receivables	$ 18.2	$ 16.8
Accumulated depreciation	$ 1,939.2	$ 1,843.9
Shareholders' Equity
Common stock, par value in USD per share	$ 5	$ 5
Common stock, share authorized	200,000,000	200,000,000
Common stock, share issued	149,418,717	148,213,331
Common stock shares held by wholly owned subsidiary	14,000,000	14,000,000
Common stock held in treasury	24,413,486	23,259,865

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Business Segment Information (Details) (Textuals) (USD $) In Millions	3 Months Ended	6 Months Ended
	Jun. 30, 2011	Jun. 30, 2011	Dec. 31, 2010
Business Segment Information (Textuals) [Abstract]
Expected restructuring costs	$ 37
Expected personnel related expense	15
Expected facility closure and other costs	22
Cost related to closure	15.6
Personnel related expense incurred	13.8
Facility closure and other costs incurred	1.8
Total assets for actuation and landing systems segment	3,187.1	3,187.1	2,239.9
Acquisition related costs		8.1
Cost of Sales [Member]
Business Segment Information (Textuals) [Abstract]
Restructuring Charges	10.7
Selling and Administrative Costs [Member]
Business Segment Information (Textuals) [Abstract]
Restructuring Charges	$ 4.9

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Other Income (Expense) - Net (Details) (USD $) In Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011	Jun. 30, 2010
Other Income (Expense) - Net
Retiree health care expenses related to previously owned businesses	$ (2.1)	$ (2.6)	$ (4.7)	$ (5.3)
Expenses related to previously owned businesses	(2.9)	(3.1)	(4.5)	(4.3)
Equity in affiliated companies	0.8	1.1	(0.1)	(0.8)
Other - Net		0.2	(0.7)	(0.4)
Other income (expense) - net	$ (4.2)	$ (4.4)	$ (10.0)	$ (10.8)

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Share-Based Compensation (Details) (USD $) In Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011	Jun. 30, 2010
Share-Based Compensation (Textuals) [Abstract]
Compensation cost	$ 28.6	$ 15.0	$ 46.5	$ 33.2

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Earnings Per Share (Details) (USD $) Share data in Millions, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011	Jun. 30, 2010
Numerator
Numerator for basic and diluted EPS- income from continuing operations attributable to Goodrich	$ 176,600,000	$ 158,900,000	$ 371,400,000	$ 268,900,000
Percentage allocated to common shareholders	98.60%	98.60%	98.60%	98.60%
Numerator for basic and diluted earnings per common share	174,100,000	156,800,000	366,200,000	265,200,000
Denominator
Denominator for basic earnings per common share - weighted-average shares	124.9	125.4	125.1	125.2
Effect of dilutive securities:
Stock options, employee stock purchase plan and other deferred compensation shares	1.0	1.1	1.0	1.2
Denominator for diluted earnings per common share - adjusted weighted-average shares and assumed conversion	125.9	126.5	126.1	126.4
Per common share income from continuing operations
Basic	$ 1.39	$ 1.25	$ 2.93	$ 2.12
Diluted	$ 1.38	$ 1.24	$ 2.90	$ 2.10
Earnings Per Share (Textuals) [Abstract]
Basic weighted-average common shares outstanding	124.9	125.4	125.1	125.2
Basic weighted-average common shares outstanding and unvested restricted share units expected to vest	126.7	127.1	126.9	126.9
Percentage allocated to common shareholders	98.60%	98.60%	98.60%	98.60%
Outstanding stock options	3.5	4.2	3.5	4.2
Anti-dilutive stock options excluded from the diluted earnings per share			0.7	0.7
Common stock issued pursuant to stock option exercises and other share based compensation plans			1.2	2.0
Stock repurchase authorized, Amount			1,100,000,000
Stock repurchased since inception of program, Shares			9.8
Common stock repurchase, Shares			1.0	0.9
Stock repurchased since inception of program, amount			$ 621,000,000

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Fair Value Measurements (Details) (USD $)	Jun. 30, 2011	Dec. 31, 2010
Derivative Financial Instruments
Cash Flow Hedges	$ 118,900,000
Fair Value Measurements (Textuals) [Abstract]
Long-term Debt	2,371,800,000	2,339,600,000
Level 1 [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value Measurements
Cash Equivalents	0	596,200,000
Derivative Financial Instruments
Rabbi Trust Assets	60,900,000	55,300,000
Long-term debt	0	0
Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | Cash Flow Hedging [Member]
Derivative Financial Instruments
Cash Flow Hedges	0	0
Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | Forward contracts [Member]
Derivative Financial Instruments
Other Forward Contracts	0	0
Level 2 [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value Measurements
Cash Equivalents	0	0
Derivative Financial Instruments
Rabbi Trust Assets	0	0
Long-term debt	(2,591,900,000)	(2,531,800,000)
Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Cash Flow Hedging [Member]
Derivative Financial Instruments
Cash Flow Hedges	118,900,000	30,600,000
Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Forward contracts [Member]
Derivative Financial Instruments
Other Forward Contracts	(1,000,000)	(200,000)
Level 3 [Member] | Fair Value, Measurements, Recurring [Member]
Fair Value Measurements
Cash Equivalents	0	0
Derivative Financial Instruments
Rabbi Trust Assets	0	0
Long-term debt	0	0
Level 3 [Member] | Fair Value, Measurements, Recurring [Member] | Cash Flow Hedging [Member]
Derivative Financial Instruments
Cash Flow Hedges	0	0
Level 3 [Member] | Fair Value, Measurements, Recurring [Member] | Forward contracts [Member]
Derivative Financial Instruments
Other Forward Contracts	0	0
Fair Value, Measurements, Recurring [Member]
Fair Value Measurements
Cash Equivalents	0	596,200,000
Derivative Financial Instruments
Rabbi Trust Assets	60,900,000	55,300,000
Long-term debt	(2,591,900,000)	(2,531,800,000)
Fair Value, Measurements, Recurring [Member] | Cash Flow Hedging [Member]
Derivative Financial Instruments
Cash Flow Hedges	118,900,000	30,600,000
Fair Value, Measurements, Recurring [Member] | Forward contracts [Member]
Derivative Financial Instruments
Other Forward Contracts	$ (1,000,000)	$ (200,000)

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Inventories (Details) (USD $) In Millions	Jun. 30, 2011	Dec. 31, 2010
Average or actual cost (which approximates current costs):
Finished products	$ 223.3	$ 224.4
In-process	2,123.5	1,866.1
Raw materials and supplies	760.7	692.8
Inventory, gross	3,107.5	2,783.3
Less:
Reserve to reduce certain inventories to LIFO basis	(53.7)	(52.7)
Progress payments and advances	(366.5)	(281.2)
Total	$ 2,687.3	$ 2,449.4

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Inventories (Details) (Textual) (USD $) In Millions	Jun. 30, 2011	Dec. 31, 2010
Inventories (Textuals) [Abstract]
Portion of in-process inventory related to contract	$ 20.7
787 [Member]
Inventories (Textuals) [Abstract]
Portion of in-process inventory related to contract	641.4
A350 XWB [Member]
Inventories (Textuals) [Abstract]
Portion of in-process inventory related to contract	265.9
PW 1000G [Member]
Inventories (Textuals) [Abstract]
Portion of in-process inventory related to contract	225.1
Pre-production and excess-over-average [Member]
Inventories (Textuals) [Abstract]
Portion of in-process inventory related to contract	$ 1,309.8	$ 1,154.2

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Goodwill (Details) (USD $) In Millions	6 Months Ended
	Jun. 30, 2011
Changes in carrying amount of goodwill
Goodwill, Beginning Balance	$ 1,762.2
Business Combinations	210.2
Foreign Currency Translation/Other	21.3
Goodwill, Ending Balance	1,993.7
Actuation and Landing Systems [Member]
Changes in carrying amount of goodwill
Goodwill, Beginning Balance	327.7
Business Combinations	213.1
Foreign Currency Translation/Other	9.9
Goodwill, Ending Balance	550.7
Nacelles and Interior Systems [Member]
Changes in carrying amount of goodwill
Goodwill, Beginning Balance	591.6
Business Combinations	(2.9)
Foreign Currency Translation/Other	7.8
Goodwill, Ending Balance	596.5
Electronic Systems [Member]
Changes in carrying amount of goodwill
Goodwill, Beginning Balance	842.9
Foreign Currency Translation/Other	3.6
Goodwill, Ending Balance	$ 846.5

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Goodwill (Details) (Textuals) (USD $) In Millions, unless otherwise specified	6 Months Ended
	Jun. 30, 2011	May 12, 2011
Goodwill (Textuals) [Abstract]
Cash paid for acquisition of Microtecnica, net of cash acquired		$ 457.1
Identifiable intangible assets		312.4
Net deferred tax liabilities primarily related to the intangible assets		106.4
Weighted Average useful life of the intangible assets	27
Goodwill		$ 213.1

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Financing Arrangements (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Dec. 31, 2010	Jun. 30, 2011
Long-term Debt
Long-term Debt	$ 2,371.8	$ 2,339.6	$ 2,371.8
Capital lease obligations	12.8	13.2	12.8
Total	2,384.6	2,352.8	2,384.6
Financing Arrangements (Textuals) [Abstract]
Revolving Credit Facility Term	Five
Borrowings under credit facility		0	32
Borrowing capacity under global syndicated revolving credit facility	622.5		622.5
Uncommitted domestic working capital facilities	75		75
Uncommitted and committed foreign working capital facilities	178.1		178.1
Future minimum lease payments under operating leases	213.9		213.9
Medium-term Notes [Member]
Long-term Debt
Long-term Debt	398.9	398.9	398.9
Schedule of Long-term Debt Instruments
Debt Instrument Interest Rate Stated Percentage Rate Range Minimum			6.80%
Debt Instrument Interest Rate Stated Percentage Rate Range Maximum			8.70%
6.29% senior notes, maturing in 2016 [Member]
Long-term Debt
Long-term Debt	294.6	295.0	294.6
Schedule of Long-term Debt Instruments
Maturity Date of Senior Notes			2016
Debt Instrument Interest Rate Stated Percentage	6.29%		6.29%
6.125% senior notes, maturing in 2019 [Member]
Long-term Debt
Long-term Debt	298.2	298.1	298.2
Schedule of Long-term Debt Instruments
Maturity Date of Senior Notes			2019
Debt Instrument Interest Rate Stated Percentage	6.125%		6.125%
4.875% senior notes, maturing in 2020 [Member]
Long-term Debt
Long-term Debt	299.4	299.4	299.4
Schedule of Long-term Debt Instruments
Maturity Date of Senior Notes			2020
Debt Instrument Interest Rate Stated Percentage	4.875%		4.875%
3.6% senior notes, maturing in 2021 [Member]
Long-term Debt
Long-term Debt	598.8	598.8	598.8
Schedule of Long-term Debt Instruments
Maturity Date of Senior Notes			2021
Debt Instrument Interest Rate Stated Percentage	3.60%		3.60%
6.80% senior notes, maturing in 2036 [Member]
Long-term Debt
Long-term Debt	234.1	233.7	234.1
Schedule of Long-term Debt Instruments
Maturity Date of Senior Notes			2036
Debt Instrument Interest Rate Stated Percentage	6.80%		6.80%
7.0% senior notes, maturing in 2038 [Member]
Long-term Debt
Long-term Debt	199.2	199.2	199.2
Schedule of Long-term Debt Instruments
Maturity Date of Senior Notes			2038
Debt Instrument Interest Rate Stated Percentage	7.00%		7.00%
Notes Payable Other Payables [Member]
Long-term Debt
Long-term Debt	48.6	16.5	48.6
Schedule of Long-term Debt Instruments
Maturity Date of Senior Notes			2020
Debt Instrument Interest Rate Stated Percentage Rate Range Minimum			0.20%
Debt Instrument Interest Rate Stated Percentage Rate Range Maximum			2.50%
Uncommitted and Committed Foreign and Domestic Working Capital Facilities [Member]
Line of Credit Facility [Line Items]
Borrowings outstanding under uncommitted and committed foreign and domestic working capital facilities	36.1	4.1	36.1
Letters of credit outstanding	22.9		22.9
Global Syndicated Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Letters of credit outstanding	45.5	62.5	45.5
Working Capital Facilities [Member]
Line of Credit Facility [Line Items]
Letters of credit outstanding	108.3		108.3
New Facility [Member]
Line of Credit Facility [Line Items]
Global syndicated revolving credit facility	700		700
Maturity period of global syndicated revolving credit facility			May 2016
Terminated Facility [Member]
Line of Credit Facility [Line Items]
Global syndicated revolving credit facility	$ 500		$ 500
Maturity period of global syndicated revolving credit facility			May 2012

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Condensed Consolidated Statement of Cash Flows (Unaudited) (USD $) In Millions	6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010
Operating Activities
Consolidated net income	$ 374.9	$ 275.2
Adjustments to reconcile consolidated net income to net cash provided by operating activities:
(Income) loss from discontinued operations		(1.3)
Restructuring and consolidation:
Expenses	20.5
Payments	(3.9)	(4.2)
Pension and postretirement benefits:
Expenses	49.2	90.1
Contributions and benefit payments	(88.8)	(129.8)
Depreciation and amortization	149.9	134.9
Excess tax benefits related to share-based payment arrangements	(10.4)	(12.9)
Share-based compensation expense	46.5	33.2
Deferred income taxes	(2.0)	7.8
Change in assets and liabilities, net of effects of acquisitions and divestitures:
Receivables	(291.4)	(90.1)
Inventories, net of pre-production and excess-over-average	(78.9)	0.4
Pre-production and excess-over-average inventories	(67.9)	(130.5)
Other current assets	7.6	2.4
Accounts payable	112.0	44.0
Accrued expenses	0.7	12.8
Income taxes payable/receivable	140.5	66.4
Other assets and liabilities	(20.9)	(45.4)
Net Cash Provided By Operating Activities	337.6	253.0
Investing Activities
Purchases of property, plant and equipment	(98.0)	(51.6)
Proceeds from sale of property, plant and equipment	0.2	0.1
Net payments made for acquisitions, net of cash acquired	(448.8)	(61.6)
Investments in and advances to equity investees	(1.0)	(1.0)
Net Cash Used In Investing Activities	(547.6)	(114.1)
Financing Activities
Increase (decrease) in short-term debt, net	(5.3)	17.8
Proceeds (repayments) of long-term debt and capital lease obligations	31.1	(0.1)
Proceeds from issuance of common stock	32.6	53.0
Purchases of treasury stock	(100.9)	(72.6)
Dividends paid	(37.4)	(68.3)
Excess tax benefits related to share-based payment arrangements	10.4	12.9
Distributions to noncontrolling interests	(8.1)	(11.3)
Net Cash Provided By (Used In) Financing Activities	(77.6)	(68.6)
Discontinued Operations
Net cash provided by (used in) operating activities	(0.2)	(0.4)
Net cash provided by (used in) investing activities	0
Net cash provided by (used in) financing activities	0
Net cash provided by (used in) discontinued operations	(0.2)	(0.4)
Effect of exchange rate changes on cash and cash equivalents	6.9	(14.5)
Net increase (decrease) in cash and cash equivalents	(280.9)	55.4
Cash and cash equivalents at beginning of period	798.9	811.0
Cash and cash equivalents at end of period	$ 518.0	$ 866.4

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Pensions and Postretirement Benefits Other Than Pensions (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011	Jun. 30, 2010
Discount rate 1/1-6/6 [Member] | U.S. Plans [Member]
Weighted average assumptions used to determine net periodic benefit cost
Discount rate	5.67%	5.90%	5.67%	5.90%
Discount rate 1/1-6/6 [Member] | U.K Plans [Member]
Weighted average assumptions used to determine net periodic benefit cost
Discount rate	5.81%	5.88%	5.81%	5.88%
Discount rate 1/1-6/6 [Member] | Other Plans [Member]
Weighted average assumptions used to determine net periodic benefit cost
Discount rate	5.20%	5.75%	5.20%	5.75%
Discount Rate 6/7-6/30 [Member] | U.S. Plans [Member]
Weighted average assumptions used to determine net periodic benefit cost
Discount rate	5.63%	5.90%	5.63%	5.90%
Discount Rate 6/7-6/30 [Member] | U.K Plans [Member]
Weighted average assumptions used to determine net periodic benefit cost
Discount rate	5.81%	5.88%	5.81%	5.88%
Discount Rate 6/7-6/30 [Member] | Other Plans [Member]
Weighted average assumptions used to determine net periodic benefit cost
Discount rate	5.20%	5.75%	5.20%	5.75%
U.S. Plans [Member]
Net periodic benefit cost for pensions
Service cost	12.2	11.4	24.4	23.1
Interest cost	42.5	42.1	85.6	84.3
Expected return on plan assets	(52.1)	(47.9)	(104.7)	(93.8)
Amortization of prior service cost	1.4	1.7	3.0	3.5
Amortization of actuarial loss	13.2	28.2	28.8	58.4
Gross periodic benefit cost	17.2	35.5	37.1	75.5
Settlement loss	0.2		0.2
Curtailment loss	1.4		1.4
Net periodic benefit cost	18.8	35.5	38.7	75.5
Termination benefit charge	4.0		4.0
Weighted average assumptions used to determine net periodic benefit cost
Expected long-term rate of return on assets	8.25%	8.75%	8.25%	8.75%
Rate of compensation increase	4.10%	4.10%	4.10%	4.10%
U.K Plans [Member]
Net periodic benefit cost for pensions
Service cost	4.4	3.6	8.6	7.7
Interest cost	10.4	9.5	21.2	19.3
Expected return on plan assets	(15.5)	(12.7)	(30.9)	(25.9)
Amortization of prior service cost	(0.2)	(0.2)	(0.3)	(0.3)
Amortization of actuarial loss	(0.4)	0.7		1.3
Gross periodic benefit cost	(1.3)	0.9	(1.4)	2.1
Net periodic benefit cost	(1.3)	0.9	(1.4)	2.1
Termination benefit charge			0.7
Weighted average assumptions used to determine net periodic benefit cost
Expected long-term rate of return on assets	8.25%	8.50%	8.25%	8.50%
Rate of compensation increase	3.75%	3.75%	3.75%	3.75%
Other Plans [Member]
Net periodic benefit cost for pensions
Service cost	2.0	1.2	3.7	2.4
Interest cost	2.3	1.7	4.3	3.5
Expected return on plan assets	(2.2)	(1.8)	(4.3)	(3.5)
Amortization of prior service cost	0.1	0.1	0.2	0.1
Amortization of actuarial loss	0.7	0.4	1.3	0.8
Gross periodic benefit cost	2.9	1.6	5.2	3.3
Net periodic benefit cost	2.9	1.6	5.2	3.3
Weighted average assumptions used to determine net periodic benefit cost
Expected long-term rate of return on assets	8.08%	8.32%	8.08%	8.32%
Rate of compensation increase	3.42%	3.38%	3.42%	3.38%

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Pensions and Postretirement Benefits Other Than Pensions (Details 1) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011	Jun. 30, 2010
Weighted average assumptions used to determine net periodic benefit cost
Defined benefit plan health care cost trend rate assumed for next fiscal year	7.50%	7.30%	7.50%	7.30%
Defined benefit plan ultimate health care cost trend rate	5.00%	5.00%	5.00%	5.00%
Defined benefit plan year that rate reaches ultimate trend rate	2017	2015	2017	2015
Other Postretirement Benefit Plans Defined Benefit [Member]
Net periodic postretirement benefit cost for other than pensions
Service cost	$ 0.2	$ 0.2	$ 0.5	$ 0.6
Interest cost	3.7	4.4	7.9	8.7
Amortization of prior service cost	(0.3)	(0.1)	(0.3)	(0.1)
Amortization of actuarial (gain) loss	0		0
Net periodic benefit cost	$ 3.6	$ 4.5	$ 8.1	$ 9.2
Weighted average assumptions used to determine net periodic benefit cost
Discount rate	5.29%	5.55%	5.29%	5.55%

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Comprehensive Income (Loss) (Details) (USD $) In Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011	Jun. 30, 2010	Dec. 31, 2010
Total comprehensive income (loss)
Net Income Attributable to Goodrich	$ 176.6	$ 159.0	$ 371.4	$ 270.2
Other comprehensive income (loss):
Unrealized foreign currency translation gains (losses) during the period	22.5	(74.7)	83.1	(128.0)
Pension/OPEB liability adjustments during the period, net of tax for the three and six months ended June 30, 2011 of ($22.3)and ($28.0), respectively; net of tax for three and six months ended june 30, 2010 of ($12.7) and ($25.8), respectively	37.2	23.3	46.0	45.0
Gain (loss) on cash flow hedges, net of tax for the three and six months ended June 30, 2011 of ($7) and ($29.7) respectively; net of tax for the three and six months ended June 30, 2010 of $26.3 and $44.3, respectively	14.0	(57.9)	62.0	(88.5)
Total comprehensive income (loss)	250.3	49.7	562.5	98.7
Accumulated other comprehensive income (loss)
Cumulative unrealized foreign currency translation gains, net of deferred taxes of ($1.7) and ($1.7), respectively	222.7		222.7		139.6
Pension/OPEB liability adjustments, net of deferred taxes of $467.1 and $495.1, respectively	(785.5)		(785.5)		(831.5)
Accumulated gains (losses) on cash flow hedges, net of deferred taxes of ($34.3) and ($4.6), respectively	77.8		77.8		15.8
TOTAL	$ (485.0)		$ (485.0)		$ (676.1)

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Comprehensive Income (Loss) (Details) (Textual) (USD $) In Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011	Jun. 30, 2010	Dec. 31, 2010
Comprehensive Income Loss (Textuals) [Abstract]
Pension and OPEB liability adjustments during the period, tax amount	$ (22.3)	$ (12.7)	$ (28.0)	$ (25.8)
Gain (loss) on cash flow hedges, Tax amount	(7.0)	26.3	(29.7)	44.3
Deferred taxes of cumulative unrealized foreign currency translation gains	(1.7)		(1.7)		(1.7)
Deferred Taxes Of Pension/Opeb Liability	467.1		467.1		495.1
Deferred taxes for accumulated gain on cash flow hedges	$ (34.3)		$ (34.3)		$ (4.6)

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Noncontrolling Interests (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011	Jun. 30, 2010
Changes in the noncontrolling interests
Beginning Balance			$ 40,900,000	$ 46,600,000
Distributions to noncontrolling interests			(8,100,000)	(11,300,000)
Comprehensive income:
Net Income attributable to noncontrolling interests	1,700,000	2,400,000	3,500,000	5,000,000
Other comprehensive income, net of tax			0	0
Comprehensive income			3,500,000	5,000,000
Ending Balance	$ 36,300,000	$ 40,300,000	$ 36,300,000	$ 40,300,000

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Income Taxes (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011	Jun. 30, 2010	Dec. 31, 2010
Income Taxes (Textuals) [Abstract]
Effective income tax rate	32.60%	32.10%	28.50%	34.60%
U.S. federal statutory rate	35.00%	35.00%
Settlement With IRS			4.00%
Reduction in effective tax rate as compared to U.S. federal statutory rate due to foreign jurisdictions taxes	2.00%	6.00%
Reduction in effective tax rate as compared to U.S. federal statutory rate due to foreign and domestic tax credits	4.00%	3.00%
Increase in effective tax rate due to adjustments to reserves for tax contingencies, included interest	1.00%	1.00%
Increased effective tax rate due to state income taxes	1.00%	2.00%
Unrecognized Tax Benefits	$ 145.7		$ 145.7		$ 147.1
Total unrecognized benefits, if recognized would Impact effective tax rate	197.5		197.5		203.9
Increase in effective tax due to repatriation of non U.S Earnings		2.00%
Increase in effective tax rate due to enactment of health care reform legislation				2.00%
Enactment of health care reform legislation charge				$ 10

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Contingencies (Details) (USD $)	3 Months Ended		6 Months Ended
	Mar. 31, 2011	Dec. 31, 2010	Jun. 30, 2011
Changes in the carrying amount of environmental remediation obligations
Accrual for Environmental Loss Contingencies, Beginning Balance	$ 67,700,000		$ 67,700,000
Accruals and adjustments			3,400,000
Payments			(2,800,000)
Foreign currency translation and other			4,200,000
Accrual for Environmental Loss Contingencies, Ending Balance		67,700,000	72,500,000
Deferred Settlement Credits Activity
Deferred Settlement Credit, Beginning Balance	48,600,000		48,600,000
Proceeds from Insurance Settlements			500,000
Amounts recorded as reduction of costs			(2,700,000)
Deferred Settlement Credit, Ending Balance		48,600,000	46,400,000
Current and long-term portions of the deferred settlement credits
Accrued expenses		5,700,000	9,100,000
Other non-current liabilities		42,900,000	37,300,000
Deferred settlement credit		48,600,000	46,400,000
Contingencies (Textuals) [Abstract]
Accrued liability for environmental remediation included as accrued expenses		14,600,000	17,000,000
Accrued liability for environmental remediation associated with ongoing operations		27,300,000	33,800,000
Accrued liability for environmental remediation associated with previously owned business		40,400,000	38,700,000
Estimated original equipment sales related to Boeing 787 contract			9,000,000,000
Total pre-production costs and inventory			20,700,000
Customer Advances related to JSTARS			8,100,000
Recognized Tax Benefit	$ 21,000,000	$ 23,000,000

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Guarantees (Details) (USD $)	6 Months Ended
	Jun. 30, 2011
Components of Carrying amount of service and product warranties
Balance at December 31, 2010	$ 148,500,000
Net provisions for warranties issued during the period	29,100,000
Net change to warranties existing at the beginning of the year	500,000
Payments	(26,400,000)
Foreign currency translation and other	9,200,000
Balance at June 30, 2011	160,900,000
Environmental remediation and other indemnifications (Note 15, "Contingencies") [Member]
Guarantor Obligations [Line Items]
Carrying Amount of Liability	15,100,000
Guarantees of residual value on leases [Member]
Guarantor Obligations [Line Items]
Maximum Potential Payment	28,100,000
Carrying Amount of Liability	0
Guarantees of JV debt and other financial instruments [Member]
Guarantor Obligations [Line Items]
Maximum Potential Payment	41,700,000
Carrying Amount of Liability	$ 0

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Guarantees (Details 1) (USD $) In Millions	Jun. 30, 2011	Dec. 31, 2010
Current and long-term portions of service and product warranties
Accrued expenses	$ 98.7	$ 90.0
Other non-current liabilities	62.2	58.5
Total	$ 160.9	$ 148.5

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Guarantees (Details Textual) In Millions, unless otherwise specified	Jun. 30, 2011 USD ($)	Jun. 30, 2011 GBP (£)
Guarantees (Textuals) [Abstract]
Guarantor on Revolving Credit Agreement Between JV and Financial Institution		£ 35
Notional Value of the forward contracts of the JV	140.7
Fair value asset of forward contracts of JV	$ 5.1
Percentage of gains/losses resulting from foreign exchange hedges, indemnified	50.00%	50.00%

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Basis of Interim Financial Statements

6 Months Ended

Jun. 30, 2011

Basis of Interim Financial Statements [Abstract]

Basis of Interim Financial Statements

Note 1. Basis of Interim Financial Statements

The accompanying unaudited condensed consolidated financial statements of Goodrich Corporation and its subsidiaries have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and notes required by accounting principles generally accepted in the United States for complete financial statements. Unless indicated otherwise or the context requires, the terms “we,” “our,” “us,” “Goodrich” or “Company” refer to Goodrich Corporation and its subsidiaries. The Company believes that all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Certain amounts in prior year financial statements have been reclassified to conform to the current year presentation. Operating results for the three and six months ended June 30, 2011 are not necessarily indicative of the results that may be achieved for the twelve months ending December 31, 2011. Unless otherwise noted, disclosures pertain to the Company’s continuing operations. For further information, refer to the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2010.

Use of Estimates. The preparation of financial statements requires management to make estimates and assumptions that affect amounts recognized. Estimates and assumptions are reviewed and updated regularly as new information becomes available. During the three and six months ended June 30, 2011 and 2010, the Company changed its estimates of revenues and costs on certain long-term contracts primarily in its aerostructures and aircraft wheels and brakes businesses. The changes in estimates increased income from continuing operations before income taxes during the three months ended June 30, 2011 and 2010 by $20.6 million and $32.8 million ($13 million and $20.6 million after tax, or $0.10 and $0.16 per diluted share, respectively). The changes in estimates increased income from continuing operations before income taxes during the six months ended June 30, 2011 and 2010 by $41.3 million and $48.8 million, respectively ($26.2 million and $30.6 million after tax or $0.20 and $0.24 per diluted share, respectively). These changes were primarily related to favorable cost and operational performance, changes in volume expectations and sales pricing improvements and finalization of contract terms on current and/or follow-on contracts.

Accrued Expenses. Accrued expenses consisted of the following:

	June 30,		December 31,
	2011		2010
	(Dollars in millions)
Deferred revenue	$	355.5	$	274.9
Wages, vacations, pensions and other employment costs		285.5		313.2
Warranties		98.7		90.0
Postretirement benefits other than pensions		28.2		29.7
Accrued taxes		40.6		31.1
Foreign currency hedges		8.4		22.5
Other		284.3		280.4
Total	$	1,101.2	$	1,041.8

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Derivatives and Hedging Activities (Details) (USD $) In Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011 Forward contracts [Member] Prepaid expenses and other assets [Member]	Dec. 31, 2010 Forward contracts [Member] Prepaid expenses and other assets [Member]	Jun. 30, 2011 Forward contracts [Member] Other assets [Member]	Dec. 31, 2010 Forward contracts [Member] Other assets [Member]	Jun. 30, 2011 Forward contracts [Member] Accrued expenses [Member]	Dec. 31, 2010 Forward contracts [Member] Accrued expenses [Member]	Jun. 30, 2011 Forward contracts [Member] Other non-current liabilities [Member]	Dec. 31, 2010 Forward contracts [Member] Other non-current liabilities [Member]
Fair value of forward contract recorded in balance sheet
Fair value of derivative assets					$ 47.3	$ 20.3	$ 82.3	$ 44.6
Fair value of derivative liabilities									8.4	22.7	2.3	11.6
Amounts recognized in other comprehensive income and reclassified from AOCI into earnings
Amount of gain/(loss) recognized in OCI, net of tax for the three and six months ended June 30,2011 of $ (7) and (29.7), respectively; net of tax for the three and six months ended June 30,2010 of $26.3 and 44.3, respectively	14.0	(57.9)	62.0	(88.5)
Amount of gain/(loss) reclassified from AOCI into sales	$ 6.7	$ (11.7)	$ 7.9	$ (16.9)

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Derivatives and Hedging Activities (Details) (Textual) (USD $) In Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011	Jun. 30, 2010	Dec. 31, 2010
Derivatives and Hedging Activities (Textuals) [Abstract]
Notional value of the forward contracts	$ 2,031.7		$ 2,031.7		$ 2,286.5
Amount of gain/(loss) recognized in OCI, Tax	(7.0)	26.3	(29.7)	44.3
Fair value of the Company's forward contracts, net asset	118.9		118.9
Losses on previously matured hedges of intercompany sales			1
Deferred Taxes on forward contracts	34		34
Gain due to asset that would be reclassified into earnings to offset the effect of the hedged item in the next 12 months	38.9		38.9
Interest rate swaps outstanding	0		0		0
Transaction gain (loss) on monetary assets	(9.6)	28.1	(23.1)	39.7
Gains (losses) on the other forward contracts	$ 4.0	$ (20.0)	$ 14.2	$ (32.5)

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New Accounting Standards Not Yet Adopted

6 Months Ended

Jun. 30, 2011

New Accounting Standards Not Yet Adopted [Abstract]

New Accounting Standards Not Yet Adopted

Note 2. New Accounting Standards Not Yet Adopted

In May 2011, accounting guidance was issued that will be included in Accounting Standards Codification (ASC) Topic 820, “Fair Value Measurement”. This guidance amends the requirements for measuring fair value and disclosing information about fair value measurements and is effective for the Company on January 1, 2012. Upon adoption, the Company does not expect this standard to have a material impact on its financial condition or results of operations.

In June 2011, accounting guidance was issued that will be included in ASC Topic 220, “Comprehensive Income”. This guidance eliminates the option to report other comprehensive income and its components in the statement of changes in equity. Companies can elect to present items of net income and other comprehensive income in one continuous statement or in two separate, but consecutive, statements. The Company is currently evaluating which method it will utilize to present items of net income and other comprehensive income. This presentation guidance is effective for the Company on January 1, 2012.

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Business Segment Information

6 Months Ended

Jun. 30, 2011

Segment Reporting [Abstract]

Business Segment Information

Note 3. Business Segment Information

The Company’s business segments are as follows:

• The Actuation and Landing Systems segment provides systems, components and related services pertaining to aircraft taxi, take-off, flight control, landing and stopping, and engine components, including fuel delivery systems and rotating assemblies.

• The Nacelles and Interior Systems segment produces products and provides maintenance, repair and overhaul services associated with aircraft engines, including thrust reversers, cowlings, nozzles and their components, and aircraft interior products, including slides, seats, cargo and lighting systems.

• The Electronic Systems segment produces a wide array of systems and components that provide flight performance measurements, flight management, fuel controls, electrical systems, control and safety data, reconnaissance and surveillance systems and precision guidance systems.

The Company measures each reporting segment’s profit based upon operating income. Accordingly, the Company does not allocate net interest expense, other income (expense) — net and income taxes to its reporting segments. The company-wide Enterprise Resource Planning (ERP) costs that are not directly associated with a specific business were not allocated to the segments. The accounting policies of the reportable segments are the same as those for the Company’s condensed consolidated financial statements.

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2011			2010			2011			2010
				(Dollars in millions)
Sales:
Actuation and Landing Systems	$	736.7		$	608.1		$	1,421.0		$	1,221.2
Nacelles and Interior Systems		688.8			577.4			1,345.2			1,133.2
Electronic Systems		575.9			532.0			1,131.1			1,058.3
	$	2,001.4		$	1,717.5		$	3,897.3		$	3,412.7
Intersegment sales:
Actuation and Landing Systems	$	15.0		$	8.0		$	24.8		$	14.8
Nacelles and Interior Systems		3.2			2.9			6.0			4.8
Electronic Systems		11.6			6.0			22.5			12.7
	$	29.8		$	16.9		$	53.3		$	32.3
Operating income:
Actuation and Landing Systems(1)	$	76.5		$	60.5		$	163.0		$	129.9
Nacelles and Interior Systems		178.2			151.4			335.5			270.2
Electronic Systems		89.8			95.1			180.8			165.9
		344.5			307.0			679.3			566.0
Corporate general and administrative expenses		(36.7	)		(27.7	)		(67.6	)		(61.6	)
ERP costs		(4.9	)		(4.0	)		(8.5	)		(8.1	)
Total operating income	$	302.9		$	275.3		$	603.2		$	496.3

(1)	Acquisition of Microtecnica S.r.l
	On May 12, 2011, the Company acquired Microtecnica S.r.l. and incurred $8.1 million of acquisition-related costs which were reported in selling and administrative costs for the six months ended June 30, 2011. In addition, total assets for the Actuation and Landing Systems segment increased from $2,239.9 million at December 31, 2010 to $3,187.1 million at June 30, 2011, primarily related to this acquisition. See Note 9, “Goodwill”.
	Closure of a Landing Gear Facility
	On June 7, 2011, the Board of Directors of the Company authorized a plan to close a facility in its landing gear business. Due to declining program volumes, the Company will close the facility and incur substantially all of the costs by the end of 2012. The Company anticipates that it will incur costs in connection with this closure of approximately $37 million, of which approximately $15 million is for personnel related expenses, including severance, pension charges, outplacement services and assistance with employment transitioning, and approximately $22 million primarily related to facility closure and other costs, including accelerated depreciation, equipment dismantle and relocation costs and lease termination costs.
	During the three months ended June 30, 2011, the Company incurred $15.6 million of costs related to this closure for which $13.8 million was personnel related and $1.8 million was facility closure and other costs. $10.7 million of these costs were reported in cost of sales and $4.9 million were reported in selling and administrative costs.

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Other Income (Expense) - Net

6 Months Ended

Jun. 30, 2011

Other Income (Expense) - Net [Abstract]

Other Income (Expense) - Net

Note 4. Other Income (Expense) — Net

Other Income (Expense) — Net consisted of the following:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2011			2010			2011			2010
				(Dollars in millions)
Retiree health care expenses related to previously owned businesses	$	(2.1	)	$	(2.6	)	$	(4.7	)	$	(5.3	)
Expenses related to previously owned businesses		(2.9	)		(3.1	)		(4.5	)		(4.3	)
Equity in affiliated companies		0.8			1.1			(0.1	)		(0.8	)
Other — net		—			0.2			(0.7	)		(0.4	)
Other income (expense) — net	$	(4.2	)	$	(4.4	)	$	(10.0	)	$	(10.8	)