Company Posts Strong Quarterly and Full Year
Results and Issues 2016 Guidance
Orbital ATK, Inc. (NYSE: OA), a global leader in aerospace and
defense technologies, today announced both GAAP and adjusted
financial results for the fourth calendar quarter and calendar year
ended December 31, 2015. The company is presenting adjusted results
because it believes these non-GAAP metrics are useful to understand
the underlying operating performance of the company by including
the pre-merger Orbital and ATK Aerospace and Defense results in
comparable periods and excluding significant transaction and
merger-related expenses and other non-operational expenses in all
periods (for details see reconciliation tables at the end of this
release).
Orbital ATK reported GAAP revenues of $1,137 million for the
fourth quarter of 2015, compared to $747 million in the same
quarter in 2014. GAAP operating income and profit margin were $87.3
million and 7.7%, respectively, in the fourth quarter of 2015
compared to $81.0 million and 10.8%, respectively, in the same
quarter of 2014. The company reported GAAP earnings per diluted
share of $0.88 in the fourth quarter of 2015 compared to earnings
per diluted share of $0.74 in the fourth quarter of 2014. Net cash
provided by operating activities was $170.3 million in the quarter
ended December 31, 2015.
Orbital ATK reported adjusted revenues of $1,137 million in the
fourth quarter of 2015 compared to adjusted revenues of $1,116
million in the comparable period of 2014. Adjusted operating income
and profit margin were $133.0 million and 11.7%, respectively, in
the fourth quarter of 2015, compared to $127.7 million and 11.4%,
respectively, in the same quarter of 2014. Adjusted diluted
earnings per share in the quarter were $1.45, compared to $1.26 for
the fourth quarter of 2014. Free cash flow was $122.2 million in
the quarter ended December 31, 2015.
Full year 2015 GAAP revenues were $4,369 million, compared to
$2,995 million in 2014. GAAP operating income and profit margin
were $319.6 million and 7.3%, respectively, in 2015, compared to
$311.1 million and 10.4%, respectively, in 2014. GAAP earnings per
diluted share in 2015 were $2.85 compared to $2.78 in 2014. Net
cash provided by operating activities was $443.5 million in
2015.
Full year 2015 adjusted revenues were $4,515 million, compared
to $4,438 million in 2014. Adjusted operating income and profit
margin were $499.8 million and 11.1%, respectively, in 2015,
compared to $438.2 million and 9.9%, respectively, in 2014.
Adjusted diluted earnings per share in 2015 were $5.02, compared to
$4.18 in 2014. Adjusted free cash flow was $290.0 million in
2015.
“Orbital ATK completed the year with strong financial and
operational results for both the fourth quarter and full year,”
said David W. Thompson, Orbital ATK’s President and Chief Executive
Officer. “In the fourth quarter, our revenue, profit margin,
earnings per share and cash flow all exceeded our expectations. For
the full year, record new orders generated a very strong 116%
book-to-bill ratio, giving us excellent visibility into the work we
will perform for our customers over the next several years.”
Mr. Thompson added, “We recently marked the one-year anniversary
of completing the merger between Orbital and ATK Aerospace and
Defense. I want to thank our customers, employees and shareholders
for their encouragement, hard work and support throughout the year,
which helped make the transition and integration such a success in
a relatively short period of time.”
______ The adjusted financial results contained in this press
release are non-GAAP financial measures and are adjusted to give
effect to the merger of Orbital Sciences Corporation (Orbital) and
Alliant Techsystems Inc. (ATK) on February 9, 2015 as if it had
occurred on January 1, 2014. In addition, adjusted results exclude
significant transaction and merger-related expenses and other
non-operational expenses in all periods. Please refer to the
reconciliation tables contained in the “Disclosure of Non-GAAP
Financial Measures” section of this press release for more details
on those adjustments.
Consolidated Financial Highlights
GAAP Results
Fourth Quarter
Twelve Months ($ in millions, except per share
data) 2015 2014 2015
2014 Revenues $ 1,137 $ 747 $ 4,369 $
2,995 Operating Income 87.3 81.0 319.6 311.1 Net Income 52.3 44.5
169.6 166.0 Diluted Earnings Per Share $ 0.88 $ 0.74 $ 2.85 $ 2.78
Adjusted Results
All “adjusted” financial measures discussed below are non-GAAP
adjusted financial results from continuing operations. See the
reconciliation tables for details.
Fourth Quarter
Twelve Months ($ in millions, except per share
data) 2015 2014 2015
2014 Adjusted Revenues $ 1,137 $ 1,116 $ 4,515
$ 4,438 Adjusted Operating Income 133.0 127.7 499.8 438.2
Adjusted Net Income 86.5 75.0 298.9 249.3 Adjusted Diluted Earnings
Per Share $ 1.45 $ 1.26 $ 5.02 $ 4.18 Adjusted results. See
reconciliation tables in the "Disclosure of Non-GAAP Financial
Measures" section for details.
Adjusted revenues increased $21 million, or 1.9%, in the fourth
quarter of 2015 compared to adjusted revenues in the same period in
2014, driven by a $31 million increase in Flight Systems Group
(“FSG”) adjusted revenues, an $11 million increase in Space Systems
Group (“SSG”) adjusted revenues, and a $3 million decrease in
corporate eliminations. These revenue increases were partially
offset by a $23 million decrease in Defense Systems Group (“DSG”)
adjusted revenues.
Adjusted operating income increased $5.3 million, or 4.2%, in
the fourth quarter of 2015 compared to the same quarter in 2014 as
a result of a $21.6 million increase in FSG, a $22.8 million
increase in SSG and a $2.3 million increase in DSG, mostly offset
by a $41.4 million decrease in corporate income primarily resulting
from the 2014 insurance settlement.
Adjusted revenues increased $77 million, or 1.7%, in 2015
compared to adjusted revenues in 2014, driven by a $33 million
increase in FSG adjusted revenues and a $122 million increase in
SSG adjusted revenues. These revenue increases were partially
offset by a $78 million decrease in DSG adjusted revenues.
Corporate eliminations were flat year over year.
Adjusted operating income increased $61.6 million, or 14.1%, in
2015 compared to 2014, driven by a $81.4 million increase in FSG, a
$35.9 million increase in SSG, and a $4.6 million increase in DSG
adjusted operating income, partly offset by a $60.3 million
decrease in corporate primarily resulting from the 2014 insurance
settlement.
Net income and earnings per share for both quarters reflect an
income tax rate of 25.4% for the fourth quarter of 2015 and an
income tax rate of 34.0% for the fourth quarter of 2014. The tax
rate in the fourth quarter of 2015 reflects the retroactive
extension of the R&D tax credit.
“We closed 2015 with another strong quarter of financial
results, including strong cash flow,” said Garrett E. Pierce, the
company’s Chief Financial Officer. “As we look forward to 2016 and
beyond, we expect to continue to see benefits from the merger in
terms of additional cost and revenue synergies that will propel
margin expansion, top-line growth and continued robust free cash
flow.”
Mr. Pierce also noted, “Beginning January 1, 2016, we moved to a
calendar-based fiscal year, completing the transition that occurred
throughout 2015 after the merger.”
Segment Results
Orbital ATK conducts its operations in three business units:
Flight Systems Group, Defense Systems Group and Space Systems
Group. Each of these groups in turn consists of several
product-line divisions. Segment operating results include pension
expense recoverable under U.S. Government contracts as determined
in accordance with government Cost Accounting Standards (CAS). The
difference between pension expense recorded in accordance with GAAP
Financial Accounting Standards (FAS) and pension costs recorded in
accordance with CAS is reported at the corporate level. The
amortization of intangible assets recorded in connection with the
merger of Orbital and ATK is also reported in corporate
results.
Flight Systems Group:
GAAP Results
Fourth Quarter
Twelve Months ($ in millions)
2015 2014 % Change
2015 2014 % Change Revenues $
386 $ 257 50.3 % $ 1,468 $ 1,013 44.9 %
Operating Income 51.7 35.9 44.1 % 239.1 125.1 91.2 % Operating
Margin 13.4 % 14.0 % 16.3 % 12.3 %
Adjusted Results
Fourth Quarter
Twelve Months ($ in millions)
2015 2014 % Change
2015 2014 % Change Adjusted
Revenues $ 386 $ 355 8.7 % $ 1,506 $ 1,473
2.2 % Adjusted Operating Income 51.7 30.1 71.5 % 241.1 159.7
51.0 % Adjusted Operating Margin 13.4 % 8.5 % 16.0 % 10.8 %
Adjusted results. See reconciliation tables in the "Disclosure of
Non-GAAP Financial Measures" section for details.
FSG adjusted revenues for the fourth quarter of 2015 increased
$31 million, or 8.7%, primarily resulting from higher Launch
Vehicles Division revenues. Adjusted operating income increased
$21.6 million, or 71.5%, while margins increased due to profit
improvement in the same division.
Defense Systems Group:
GAAP Results
Fourth Quarter
Twelve Months ($ in millions)
2015 2014 % Change
2015 2014 % Change Revenues $
442 $ 466 (5.2 %) $ 1,829 $ 1,944 (5.9
%) Operating Income 42.6 48.6 (12.3 %) 161.9 184.4 (12.2 %)
Operating Margin 9.6 % 10.4 % 8.9 % 9.5 %
Adjusted Results
Fourth Quarter Twelve Months
($ in millions) 2015 2014
% Change 2015 2014 %
Change Adjusted Revenues $ 442 $ 465 (5.0 %) $
1,836 $ 1,914 (4.1 %) Adjusted Operating Income 50.9
48.6 4.9 % 190.4 185.8 2.5 % Adjusted Operating Margin 11.5 % 10.4
% 10.4 % 9.7 % Adjusted results. See reconciliation tables
in the "Disclosure of Non-GAAP Financial Measures" section for
details.
DSG adjusted revenues for the fourth quarter of 2015 decreased
$23 million, or 5.0%, and adjusted operating income increased $2.3
million, or 4.9%, primarily from timing of contracts in multiple
divisions.
Space Systems Group:
GAAP Results
Fourth Quarter
Twelve Months ($ in millions)
2015 2014 % Change
2015 2014 % Change Revenues $
327 $ 69 375.3 % $ 1,164 $ 309 277.3 %
Operating Income 20.4 4.1 394.0 % 51.3 23.3 120.5 % Operating
Margin 6.3 % 6.0 % 4.4 % 7.5 %
Adjusted Results
Fourth Quarter
Twelve Months ($ in millions)
2015 2014 % Change
2015 2014 % Change Adjusted
Revenues $ 327 $ 316 3.5 % $ 1,260 $ 1,139
10.7 % Adjusted Operating Income 26.8 4.0 562.7 % 98.3 62.4
57.6 % Adjusted Operating Margin 8.2 % 1.3 % 7.8 % 5.5 %
Adjusted results. See reconciliation tables in the "Disclosure of
Non-GAAP Financial Measures" section for details.
SSG adjusted revenues for the fourth quarter of 2015 increased
$11 million, or 3.5%, resulting from higher Commercial Satellite
Division and higher Civil and Defense Satellite Division revenues.
Adjusted operating income increased $22.8 million, or 562.7%, in
the quarter resulting from profit improvements in the Civil and
Defense Satellite Division.
Free Cash Flow and Capital Allocation Plan
Free cash flow in the fourth quarter of 2015 was $122.2 million.
For calendar year 2015, adjusted free cash flow was $290.0 million,
which resulted from $443.5 million of cash from continuing
operations less $152.9 million of capital expenditures and
adjustments of $0.6 million (see non-GAAP reconciliation table for
details).
The company also reported that it repurchased approximately $15
million of its stock and paid dividends of approximately $15
million during the fourth quarter of 2015. For calendar year 2015,
the company repurchased approximately $76 million of its stock and
paid dividends of approximately $57 million.
Operational Highlights
Orbital ATK’s strong operational execution led to the
achievement of numerous milestones in the quarter. These included
the following important events:
In the Flight Systems Group, integration of the upgraded first
stage propulsion system for the Antares rocket progressed well and
a second ship-set of engines was also received in the quarter. The
company carried out several successful launches, including an
Intermediate Range Ballistic Target and a Patriot Target Vehicle
for missile defense testing and two Coyote naval target missiles.
Orbital ATK supported several successful customer launches with
propulsion systems and composite structures, including a Minuteman
III missile for the Air Force and three United Launch Alliance
(ULA) Atlas V launch vehicles. The company reached production
milestones in its aerospace structures division, including delivery
of the 3,000th F-35 part and the 200th Rolls-Royce Trent XWB engine
case.
In the Defense Systems Group, Orbital ATK delivered more than
7,000 tactical missile rocket motors, warheads and related
products, and produced over 250 million rounds of small- and
medium-caliber ammunition in the fourth quarter. The company also
increased production of its AARGM tactical missiles and
successfully demonstrated a hypersonic air-breathing engine for
future missile applications as well as precision weapons
technologies for customers. DSG also opened in-country offices in
Saudi Arabia and United Arab Emirates to better support customers
in those countries.
In the Space Systems Group, the company successfully launched
its Cygnus spacecraft to the International Space Station aboard a
ULA Atlas V rocket from Cape Canaveral Air Force Station, Florida,
marking the resumption of cargo delivery missions for NASA. In
addition, production remained on schedule for several commercial
satellite programs, including final testing and ground delivery of
the Thaicom-8 communications satellite that is currently scheduled
for launch this spring. The company-built Dawn interplanetary
spacecraft reached its final orbit around Ceres, returning
first-of-its-kind images and scientific data about the giant
asteroid. Orbital ATK also shipped fuel and oxidizer tanks for
integration into NASA’s James Webb Space Telescope and carried out
five successful suborbital research rocket launches during the
fourth quarter.
Commenting on fourth quarter 2015 operations, Chief Operating
Officer Blake E. Larson said, “Our focus on operational excellence
throughout the company resulted in another quarter of very solid
progress on numerous major contracts. In the quarter, we reinstated
cargo delivery missions to the International Space Station for
NASA, ramped up our monthly production rate on the A350 program for
Airbus, increased production rates on the AARGM tactical missile
program for the U.S. Navy, and met production demand in our small
caliber ammunition business for commercial and government
customers. We also exceeded our cost synergy targets for 2015, with
more progress to be made this year, which should enable us to reach
the high end of our expectations.”
New Business Summary
In the fourth quarter of 2015, Orbital ATK recorded
approximately $855 million in new firm and option contract
bookings. In addition, the company received approximately $305
million in option exercises under existing contracts. For the full
year, the company booked about $6.7 billion in new firm and option
orders and received $1.3 billion in option exercises. As of
December 31, 2015, the company’s firm backlog was approximately
$8.1 billion and its total backlog (including options, indefinite
quantity contract and undefinitized orders) was approximately $13.5
billion.
Calendar Year 2016 Financial Guidance
The company provided the following financial guidance for
calendar year 2016. The guidance does not include any
merger-related expenses that may occur in 2016. The guidance also
includes about $50 million of annual non-cash intangible asset
amortization expense resulting from the merger in early 2015.
Guidance
2016 Guidance Revenues ($ in millions)
$4,575 - $4,650 Operating Income Profit Margin
11.0% - 11.5% Diluted Earnings Per Share
$5.25 - $5.50 Free Cash Flow ($ in millions)
$275 - $325
Orbital ATK currently expects interest expense of approximately
$60 million and an effective tax rate of approximately 32% for the
year. Pension funding is expected to be approximately $40 million
and capital expenditures are projected at about $215 million for
the year. Diluted weighted average shares outstanding are expected
to be about 58 million in 2016. The FAS/CAS pension adjustment is
expected to be about $80 million in 2016.
Other SEC Filings
Earlier today, Orbital ATK reported on a Form 8-K that it is
restating its financial statements for the quarterly periods ended
July 5, 2015 and October 4, 2015. The accounting change resulting
from the restatement of the 2015 quarterly periods is reflected in
the fourth quarter and calendar year 2015 results presented in this
press release. The restatement did not have a material impact on
the company’s consolidated financial statements for the quarter and
fiscal year ended March 31, 2015, nor does the company anticipate a
material impact of the company’s consolidated financial statements
for the nine-month transition period ended December 31, 2015. The
restatement did not have a negative impact of the company’s
operating cash flow, cash balances or backlog.
Also, as reported in our Form 12b-25 filing with the SEC filed
earlier today, the company is delaying the filing of its Form 10-K
for the nine-month transition period ended December 31, 2015. As
such, amounts in this press release are unaudited and subject to
change. The company expects to file the Form 10-K within the 15-day
period permitted by SEC rules.
Conference Call Information
Investors can listen to a live audio webcast of the conference
call with analysts that Orbital ATK will host at 9:00 a.m. (EST)
March 1, 2016. To listen to the call, visit the company’s website
at www.orbitalatk.com/investors. For those who cannot listen to the
live webcast, a telephone recording of the conference call will be
available by dialing (855) 859-2056 and using the conference ID
53395841. The recording will be available until March 15, 2016.
Orbital ATK has also posted on its investor relations website a
presentation of fourth quarter and full calendar year 2015
financial results and operational highlights.
Social Media Disclosure
Orbital ATK communicates material financial information to its
investors using press releases, Securities and Exchange Commission
filings, its investor relations website, public conference calls
and webcasts. From time to time, Orbital ATK communicates
information regarding its business and operations, such as new
contract awards and mission updates, via Twitter and Facebook. It
is possible that the information disclosed through such social
media channels could be deemed to be material. Therefore, we
encourage investors, the media and others interested in Orbital ATK
to follow the information we post on Twitter at
https://twitter.com/OrbitalATK and on Facebook at
https://facebook.com/OrbitalATK.
About Orbital ATK
Orbital ATK is a global leader in aerospace and defense
technologies. The company designs, builds and delivers space,
defense and aviation systems for customers around the world, both
as a prime contractor and merchant supplier. Its main products
include launch vehicles and related propulsion systems; missile
products, subsystems and defense electronics; precision weapons,
armament systems and ammunition; satellites and associated space
components and services; and advanced aerospace structures.
Headquartered in Dulles, Virginia, Orbital ATK employs
approximately 12,000 people in 18 states across the United States
and in several international locations. For more information, visit
www.orbitalatk.com.
“Safe Harbor” Statement Under the Private Securities
Litigation Reform Act of 1995
Certain statements in this press release may be “forward-looking
statements” as defined by the Private Securities Litigation Reform
Act of 1995. Forward-looking statements often include the words
“forecast,” “expect,” “believe,” “will,” “intend,” “plan,” and
words of similar substance. Such forward-looking statements are
subject to risks and uncertainties that could cause actual results
or performance to differ, including the following: potential
difficulties in achieving expected merger synergies and
efficiencies within the expected time-frames or at all; the
integration of business operations being more difficult,
time-consuming or costly than expected; operating costs, customer
loss and business disruption that might result from the merger;
potential difficulties in retaining key employees; the company’s
ability to maintain and grow its relationship with its customers;
reductions or changes in U.S. Government military or NASA spending,
including impacts of sequestration under the Budget Control Act of
2011; changes in cost and revenue estimates and/or timing of
programs and payments; the potential termination of U.S. Government
contracts; failure to win or retain key contracts; costs of
servicing debt, including cash requirements and interest rate
fluctuations; the company’s capital deployment strategy, including
share repurchases and dividend payments; actual pension asset
returns and assumptions regarding future returns, discount rates
and service costs; supply, availability, and costs of raw materials
and components, including commodity price fluctuations; performance
of subcontractors and other third parties; development of key
technologies; and the costs and ultimate outcome of contingencies,
including litigation, government investigations and other legal
proceedings. Additional information concerning these and other
factors can be found in Orbital ATK’s filings with the Securities
and Exchange Commission. Orbital ATK undertakes no obligation to
update any forward-looking statements, except as may be required by
law.
Disclosure of Non-GAAP Financial Measures
The adjusted financial results contained in this press release
are non-GAAP financial measures adjusted to give effect to the
merger of Orbital and ATK in all periods and adjust for the impact
of costs and expenses itemized in the tables below. In addition,
the adjusted results reflect estimates of interest expense, the
income tax rate and diluted shares that would be in effect for the
periods as if the merger of Orbital and ATK and divestiture of
ATK’s Sporting Group had occurred on January 1, 2014. Please refer
to the reconciliation tables below for more details.
We define free cash flow as GAAP (U.S. Generally Accepted
Accounting Principles) net cash provided by (used in) operating
activities less capital expenditures for property, plant and
equipment. Management believes that the company’s presentation of
free cash flow is useful because it provides investors with an
important perspective on the company’s liquidity, financial
flexibility and ability to fund operations and service debt. The
company’s management also uses free cash flow in its operational
decision-making.
Adjusted measures are provided so investors can more easily
compare current and prior period results of the combined companies.
These adjusted results should not be considered in isolation or as
a substitute for the related GAAP measures, and other companies may
define such measures differently. We encourage investors to review
our financial statements and publicly-filed reports in their
entirety and not to rely on any single financial measure. The
reconciliation of GAAP results to adjusted results are as
follows:
Adjusted Consolidated
Results
Quarter Ended December 31, 2015
($ in millions,
except per share data) Revenue
OperatingIncome
OperatingMargin
GAAP $ 1,137 $
87.3 7.7 % Merger- related Adjustments (1)
10.6 Business Rationalization (2) 35.1
As Adjusted $ 1,137 $ 133.0
11.7 % Interest Expense (16.9 ) Taxes (3)
(29.5 ) Minority Interest (0.1 )
Adjusted Net Income
$ 86.5 Adjusted EPS (4)
$
1.45 (1) Includes the impact of merger related costs.
(2) Includes the impact of business rationalization costs.
(3) Calculated using an effective tax rate
of 25.4%.
(4) Calculated using a diluted share count of 59.57 million.
Twelve Months Ending December 31,
2015
($ in millions, except per share data)
Revenue
OperatingIncome
OperatingMargin
GAAP $ 4,369 $ 319.6
7.3 % Orbital Results for Jan. 1 to Feb. 8, 2015
129 (7.5 )
$ 4,498 $
312.1 6.9 % Transaction Expenses 33.4
Severance and Accelerated Vesting 29.9 Intangible Amortization (7.0
) Goodwill Impairment 34.3 Legal Settlement 25.0 Other (1)
17 72.2
As Adjusted $
4,515 $ 499.8 11.1 %
Interest Expense (2) (63.3 ) Taxes (3) (137.3 ) Minority Interest
(0.3 )
Adjusted Net Income $ 298.9
Adjusted EPS (4)
$ 5.02 (1)
Includes merger-related change in intracompany eliminations,
restructuring and other transaction impacts. (2) Interest expense
excludes an approximately $9 million charge related to the
September 2015 debt refinance transaction. (3) Calculated using an
effective tax rate of 31.5%. (4) Calculated using a diluted share
count of 59.51 million.
Quarter Ended December 31, 2014
($ in millions,
except per share data) Revenue
OperatingIncome
OperatingMargin
GAAP, From Continuing Operations $ 747
$ 81.0 10.8 % Orbital Results for
October 1 to December 31, 2014(1) 366 42.5
$ 1,113 $ 123.4 11.1
% Intangible Amortization (11.8 ) Transaction
Expenses 6.2 Change In Intercompany Eliminations 3
9.9
As Adjusted $ 1,116 $
127.7 11.4 % Interest Expense (2) (13.8
) Taxes (3) (38.7 ) Minority Interest (0.1 )
Adjusted Net
Income $ 75.0 Adjusted EPS (4)
$ 1.26 (1) Per Orbital Sciences Corporation
operating results. (2) Calculated assuming a blended interest rate
of 3.6% on $1.6 billion average outstanding debt. (3) Calculated
using an effective tax rate of 34%. (4) Calculated using a diluted
share count of 59.75 million.
Twelve Months Ending December 31,
2014
($ in millions, except per share data)
Revenue
Operating Income
Operating Margin
GAAP, From Continuing Operations $
2,995 $ 311.1 10.4 % Orbital
Results for January 1 to December 31, 2014(1) 1,345
126.5
$ 4,341 $
437.6 10.1 % Transaction Expenses 28.4
Intangible Amortization (48.6 ) Pension Close Out (30 ) (30.5 )
Environmental Settlement 5.2 Change In Intercompany Eliminations
127 35.4 Facility Rationalization 10.6
As Adjusted $ 4,438 $ 438.2
9.9 % Interest Expense (2) (60.0 ) Taxes (3)
(128.6 ) Minority Interest (0.3 )
Adjusted Net Income
$ 249.3 Adjusted EPS (4)
$
4.18 (1) Per Orbital Sciences Corporation Form 10-Q
for first nine months of 2014 and operating results for the quarter
ended December 31, 2014. (2) Calculated assuming a blended interest
rate of 3.6% on $1.6 billion average outstanding debt. (3)
Calculated using an effective tax rate of 34%. (4) Calculated using
a diluted share count of 59.66 million.
Flight Systems
Group Adjusted Results
Fourth Quarter 2015 Twelve Months 2015
($ in millions) Revenue
Operating Income
Operating Margin
Revenue
Operating Income
Operating Margin
GAAP As Reported $ 386 $
51.7 13.4 % $ 1,468 $
239.1 16.3 % Orbital Results for Jan. 1 to
Feb. 8, 2015 - - 38 2.0
As Adjusted
$ 386 $ 51.7 13.4 %
$ 1,506 $ 241.1 16.0 %
Fourth Quarter
2014 Twelve Months 2014 ($ in
millions) Revenue
Operating Income
Operating Margin
Revenue
Operating Income
Operating Margin
GAAP As Reported $
257 $ 35.9 14.0 % $
1,013 $ 125.1 12.3 % Orbital
Results(1) 118 (5.7 ) 511
33.8
$ 374 $ 30.1
8.0 % $ 1,524 $ 158.9
10.4 % Other Eliminations (20 ) -
(51 ) 0.8
As Adjusted
$ 355 $ 30.1 8.5 %
$ 1,473 $ 159.7 10.8 %
(1) Per Orbital Sciences Corporation operating results for the
quarter ended December 31, 2014.
Defense Systems
Group Adjusted Results
Fourth Quarter 2015 Twelve Months 2015
($ in millions) Revenue
Operating Income
Operating Margin
Revenue
Operating Income
Operating Margin
GAAP As Reported $ 442 $
42.6 9.6 % $ 1,829 $
161.9 8.9 % Business Rationalization - 3.6
- 3.6 Transaction-related Impacts - 4.8
7 24.9
As Adjusted $ 442
$ 50.9 11.5 % $ 1,836
$ 190.4 10.4 %
Fourth Quarter 2014
Twelve Months 2014 ($ in millions)
Revenue
Operating Income
Operating Margin
Revenue
Operating Income
Operating Margin
GAAP As Reported $
466 $ 48.6 10.4 % $
1,944 $ 184.4 9.5 % Pension
Close Out and Other Eliminations (1 ) -
(30 ) 1.3
As Adjusted $
465 $ 48.6 10.4 % $
1,914 $ 185.8 9.7 %
Space Systems
Group Adjusted Results
Fourth Quarter 2015 Twelve Months 2015 ($ in
millions) Revenue
OperatingIncome
OperatingMargin
Revenue
OperatingIncome
OperatingMargin
GAAP As Reported $ 327 $
20.4 6.3 % $ 1,164 $
51.3 4.4 % Orbital Results for Jan. 1 to Feb.
8, 2015 - - 92 2.3
$ 327 $ 20.4 6.3 %
$ 1,257 $ 53.6 4.3 %
Goodwill Impairment - - - 34.3 Business Rationalization - 6.4 - 6.4
Transaction-related Impacts - - 4
4.0
As Adjusted $ 327 $
26.8 8.2 % $ 1,260 $
98.3 7.8 %
Fourth Quarter 2014
Twelve Months 2014 ($ in millions)
Revenue
OperatingIncome
OperatingMargin
Revenue
OperatingIncome
OperatingMargin
GAAP As Reported $
69 $ 4.1 6.0 % $
309 $ 23.3 7.5 % Orbital
Results(1) 252 1.4 851
43.2
$ 321 $
5.5 1.7 % $ 1,160 $
66.4 5.7 % Other Eliminations (5
) (1.5 ) (21 ) (4.0 )
As
Adjusted $ 316 $ 4.0 1.3
% $ 1,139 $ 62.4 5.5
%
(1) Per Orbital Sciences Corporation
operating results for the quarter ended December 31, 2014.
Free Cash Flow
and Adjusted Free Cash Flow
($ in millions)
FourthQuarter2015
Twelve Months2015
Net Cash Used In/Provided By Continuing Operating Activities
$ 170.3 $ 443.5 Capital Expenditures (48.2 ) (152.9 )
122.2 290.6 Adjustments 0.0 (0.6 )
(1)
Adjusted Free Cash Flow $ 122.2
$ 290.0
(1) Includes Orbital cash flow for
pre-merger period; excludes merger and other non-recurring cash
expenditures and adjusts for the timing of certain significant cash
expenditures.
Condensed Consolidated Statements of Income from
Continuing Operations GAAP As Reported
Nine Months Ended (In millions except per
share data)
December 31, 2015 Sales $ 3,399
Cost of sales (2,498 ) Operating expenses (630 ) Gain on settlement
50 Operating income 321 Interest expense (57 )
Pretax income 264 Income taxes (83 ) Net income from
continuing operations 181 Basic net income
from continuing operations per common share $ 3.05
Weighted-average number of common shares outstanding (in thousands)
59,358
Diluted net income from continuing
operations per common share
$ 3.02 Weighted-average number of diluted common shares
outstanding (in thousands) 59,915
Condensed Consolidated Balance Sheets GAAP As
Reported (In millions)
December 31, 2015 March 31, 2015
Assets Current assets: Cash and cash equivalents $ 104 $ 139
Net receivables 1,792 1,794 Other current assets 354
455
Total current assets
2,250 2,388 Net property, plant and equipment 806 807 Goodwill
1,853 1,875 Other noncurrent assets 443 434
Total
assets $ 5,352 $ 5,504
Liabilities and Equity
Total current liabilities 974 1,097 Long-term debt 1,450 1,529
Other noncurrent liabilities 981 1,090
Total
liabilities 3,405 3,716 Total equity 1,947 1,788
Total liabilities and equity $ 5,352 $ 5,504
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version on businesswire.com: http://www.businesswire.com/news/home/20160229007038/en/
Investor and Media:Orbital ATK, Inc.Barron Beneski,
703-406-5528Barron.Beneski@orbitalatk.com
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