WALTHAM, Mass., April 27, 2021 /PRNewswire/ -- Raytheon
Technologies Corporation (NYSE: RTX) reported first quarter 2021
results.
First quarter 2021
- Sales of $15.3 billion
- GAAP EPS from continuing operations of $0.51, which included $0.39 of net significant and/or non-recurring
charges and acquisition accounting adjustments
- Adjusted EPS of $0.90
- Operating cash flow from continuing operations of $723 million; Free cash flow of
$336 million
- Achieved approximately $200
million of RTX synergies
- Resumed share repurchase program, and repurchased $375 million of shares
- Closed on the divestiture of Forcepoint for gross proceeds of
$1.1 billion
Raytheon Technologies updates its 2021 outlook and now
anticipates the following:
Outlook for full year 2021
- Sales of $63.9 - $65.4 billion, up from $63.4 - $65.4
billion
- Adjusted EPS of $3.50 -
$3.70, up from $3.40 - $3.70
- Share repurchases of at least $2
billion, up from $1.5
billion
- Confirms free cash flow outlook of approximately $4.5 billion
"Raytheon Technologies delivered strong first quarter results
with sales, adjusted EPS and free cash flow that were above our
initial expectations, giving us the confidence to increase the low
end of our sales and adjusted EPS outlook," said Raytheon
Technologies chief executive officer Greg
Hayes. "Earlier this month marked the one year anniversary
of our transformational merger, and our successful execution on the
integration to date has enabled us to increase our gross cost
synergy target by $300 million to
$1.3 billion. Our strong cash
position and positive outlook also allows us to increase our 2021
share buyback plan from $1.5 billion
to at least $2 billion and raise our
second quarter dividend by over 7 percent."
Hayes continued, "We are confident in our outlook for the
remainder of 2021. With our strong defense backlog and continued
recovery in commercial air travel, we are well positioned to
deliver profitable growth and return cash to drive significant
value for shareowners. At the same time, we continue to invest in
innovative technologies to deliver advanced solutions for our
customers that differentiate us in aerospace and defense."
Raytheon Technologies reported first quarter sales of
$15.3 billion. GAAP EPS from
continuing operations was $0.51 and
included $0.39 of net significant
and/or non-recurring charges and acquisition accounting
adjustments. This included $0.26 of
acquisition accounting adjustments primarily related to intangible
amortization, $0.10 of tax related to
the Forcepoint disposition, $0.02 of
restructuring, and $0.01 of other
items. Adjusted EPS was $0.90. Sales
and adjusted EPS were in-line with the company's updated outlook
communicated on April
9th.
The company recorded net income from continuing operations in
the first quarter of $772 million,
which included $598 million of net
significant and/or nonrecurring charges and acquisition accounting
adjustments. Adjusted net income was $1,370
million. Operating cash flow from continuing operations in
the first quarter was $723 million.
Capital expenditures were $387
million, resulting in free cash flow of
$336 million.
Summary Financial
Results – Continuing Operations
|
($ in millions,
except EPS)
|
|
1st Quarter
2021
|
Reported
|
|
|
|
Sales
|
$
|
15,251
|
|
Net Income
|
$
|
772
|
|
EPS
|
$
|
0.51
|
|
|
|
|
|
Adjusted
|
|
|
|
Sales
|
$
|
15,251
|
|
Net Income
|
$
|
1,370
|
|
EPS
|
$
|
0.90
|
|
|
|
|
|
Operating Cash Flow
from Continuing Operations
|
$
|
723
|
|
Free Cash
Flow
|
|
$
|
336
|
|
|
|
|
|
|
|
|
See "Use and
Definitions of Non-GAAP Financial Measures" below for information
regarding non-GAAP financial measures.
|
Backlog and Bookings
Backlog at the end of the first
quarter was $147.4 billion, of which
$82.2 billion was from commercial
aerospace and $65.2 billion was from
defense.
Notable defense bookings during the quarter included:
- $1.4 billion of classified
bookings at Raytheon Intelligence & Space (RIS)
- $593 million for two F-135
sustainment services contracts at Pratt & Whitney
- $518 million for the Advanced
Medium-Range Air-to-Air Missile (AMRAAM) for the U.S. Air Force,
Navy and international customers at Raytheon Missiles & Defense
(RMD)
- $247 million to provide Patriot
engineering services for the U.S. Army and international customers
at RMD
- $227 million on a missile warning
and defense contract at RIS
- $199 million for an international
tactical airborne radar sustainment contract at RIS
In addition, during the quarter, RMD's industry team was
down-selected for the Next Generation Interceptor award.
Segment Results
The company's reportable segments are
Collins Aerospace, Pratt & Whitney, Raytheon Intelligence &
Space (RIS) and Raytheon Missiles & Defense (RMD). In
connection with the merger, the company revised its segment
presentation. Prior periods have been revised to reflect the
current presentation. Refer to the accompanying tables for further
details.
Collins
Aerospace
|
|
1st
Quarter
|
($ in
millions)
|
2021
|
|
2020
|
%
Change
|
Reported
|
|
|
|
|
Sales
|
$
|
4,370
|
|
|
$
|
6,438
|
|
(32)
|
%
|
Operating
Profit
|
$
|
314
|
|
|
$
|
1,246
|
|
(75)
|
%
|
ROS
|
7.2
|
%
|
|
19.4
|
%
|
|
|
|
|
|
|
Adjusted
|
|
|
|
|
Sales
|
$
|
4,370
|
|
|
$
|
6,460
|
|
(32)
|
%
|
Operating
Profit
|
$
|
332
|
|
|
$
|
1,284
|
|
(74)
|
%
|
ROS
|
7.6
|
%
|
|
19.9
|
%
|
|
|
Note: Prior
periods have been revised to reflect the current segment
presentation which excludes acquisition accounting adjustments and
includes additional corporate expense allocations.
|
Collins Aerospace had first quarter 2021 adjusted sales of
$4,370 million, down 32 percent
versus the prior year. Commercial OE was down 45 percent,
commercial aftermarket was down 43 percent, and military was down 3
percent. Excluding the impact of the prior year Military GPS and
Space ISR divestitures and FX, military was up 4 percent in the
quarter. The expected decrease in commercial sales was driven
primarily by the current environment which has resulted in lower
flight hours, aircraft fleet utilization and commercial OEM
deliveries.
Collins Aerospace recorded adjusted operating profit of
$332 million in the quarter, down 74
percent versus the prior year. The expected decrease in adjusted
operating profit was driven by lower commercial aerospace
aftermarket and OEM sales volume, as well as the impact of the
Military GPS and Space ISR divestitures. This was partially offset
by cost reduction actions.
Pratt &
Whitney
|
|
1st
Quarter
|
($ in
millions)
|
2021
|
|
2020
|
%
Change
|
Reported
|
|
|
|
|
Sales
|
$
|
4,030
|
|
|
$
|
5,353
|
|
(25)
|
%
|
Operating
Profit
|
$
|
20
|
|
|
$
|
475
|
|
(96)
|
%
|
ROS
|
0.5
|
%
|
|
8.9
|
%
|
|
|
|
|
|
|
Adjusted
|
|
|
|
|
Sales
|
$
|
4,030
|
|
|
$
|
5,331
|
|
(24)
|
%
|
Operating
Profit
|
$
|
40
|
|
|
$
|
515
|
|
(92)
|
%
|
ROS
|
1.0
|
%
|
|
9.7
|
%
|
|
|
Note: Prior
periods have been revised to reflect the current segment
presentation which excludes acquisition accounting adjustments and
includes additional corporate expense allocations.
|
Pratt & Whitney had first quarter 2021 adjusted sales of
$4,030 million, down 24 percent
versus the prior year. Commercial OE was down 40 percent and
commercial aftermarket was down 35 percent, while military was up 1
percent. The expected decrease in commercial sales was primarily
due to a significant reduction in shop visits and related spare
part sales, and commercial engine deliveries principally driven by
the current environment.
Pratt & Whitney recorded adjusted operating profit of
$40 million in the quarter, down 92
percent versus the prior year. The expected decrease in adjusted
operating profit was primarily driven by lower commercial
aftermarket sales volume and unfavorable mix. This was partially
offset by cost reduction actions.
Raytheon
Intelligence & Space
|
|
1st
Quarter
|
($ in
millions)
|
2021
|
Reported
|
|
Sales
|
$
|
3,765
|
|
Operating
Profit
|
$
|
388
|
|
ROS
|
10.3
|
%
|
|
|
Adjusted
|
|
Sales
|
$
|
3,765
|
|
Operating
Profit
|
$
|
388
|
|
ROS
|
10.3
|
%
|
|
|
Note: The United
Technologies Corporation and Raytheon Company merger completed on
April 3, 2020. Therefore, there are no comparable first quarter
2020 results.
|
RIS had first quarter adjusted sales of $3,765 million and adjusted operating profit of
$388 million.
Raytheon Missiles
& Defense
|
|
1st
Quarter
|
($ in
millions)
|
2021
|
Reported
|
|
Sales
|
$
|
3,793
|
|
Operating
Profit
|
$
|
496
|
|
ROS
|
13.1
|
%
|
|
|
Adjusted
|
|
Sales
|
$
|
3,793
|
|
Operating
Profit
|
$
|
496
|
|
ROS
|
13.1
|
%
|
|
|
Note: The United
Technologies Corporation and Raytheon Company merger completed on
April 3, 2020. Therefore, there are no comparable first quarter
2020 results.
|
RMD had first quarter adjusted sales of $3,793 million and adjusted operating profit of
$496 million.
Raytheon Technologies updates its 2021 outlook and now
anticipates the following:
Outlook for full year 2021
- Sales of $63.9 - $65.4 billion, up from $63.4 - $65.4
billion
- Adjusted EPS of $3.50 -
$3.70, up from $3.40 - $3.70
- Share repurchases of at least $2
billion, up from $1.5
billion
- There is no change in the company's previously provided 2021
expectations for:
-
- Free cash flow of approximately $4.5
billion
Outlook for Q2 2021
- Sales of $15.5 - $16.0 billion
- Adjusted EPS of $0.90 -
$0.95
2021 Investor Day
Raytheon Technologies will host an
investor day on May 18, 2021 with
presentations from management from 10:30
a.m. – 2:30 p.m. ET. Details
will be available on the Company's website at
investors.rtx.com.
About Raytheon Technologies
Raytheon Technologies
Corporation is an aerospace and defense company that provides
advanced systems and services for commercial, military and
government customers worldwide. With four industry-leading
businesses ― Collins Aerospace Systems, Pratt & Whitney,
Raytheon Intelligence & Space and Raytheon Missiles &
Defense ― the company delivers solutions that push the boundaries
in avionics, cybersecurity, directed energy, electric propulsion,
hypersonics, and quantum physics. The company, formed in 2020
through the combination of Raytheon Company and the United
Technologies Corporation aerospace businesses, is headquartered in
Waltham, Massachusetts.
Conference Call on the First Quarter 2021 Financial
Results
Raytheon Technologies' financial results conference
call will be held on Tuesday, April 27, 2021 at 8:30 a.m. ET. The dial-in number for the
conference call will be (866) 219-7829 in the U.S. or (478)
205-0667 outside of the U.S. The passcode is 9535368. The
conference call will also be audiocast on the Internet at
www.rtx.com. Individuals may listen to the call and download charts
that will be used during the call. These charts will be available
for printing prior to the call.
Use and Definitions of Non-GAAP Financial
Measures
Raytheon Technologies Corporation's ("RTC")
reports its financial results in accordance with accounting
principles generally accepted in the
United States ("GAAP").
We supplement the reporting of our financial information
determined under GAAP with certain non-GAAP financial information.
The non-GAAP information presented provides investors with
additional useful information, but should not be considered in
isolation or as substitutes for the related GAAP measures.
Moreover, other companies may define non-GAAP measures differently,
which limits the usefulness of these measures for comparisons with
such other companies. We encourage investors to review our
financial statements and publicly-filed reports in their entirety
and not to rely on any single financial measure.
Adjusted net sales, organic sales, adjusted operating profit
(loss), adjusted net income and adjusted earnings per share ("EPS")
are non-GAAP financial measures. Adjusted net sales represents
consolidated net sales (a GAAP measure), excluding significant
items of a non-recurring and/or nonoperational nature (hereinafter
referred to as "other significant items"). Organic sales represents
consolidated net sales (a GAAP measure), excluding the impact of
foreign currency translation, acquisitions and divestitures
completed in the preceding twelve months and other significant
items. Adjusted operating profit (loss) represents operating profit
(loss) (a GAAP measure), excluding restructuring costs, acquisition
accounting adjustments and other significant items. Adjusted net
income represents net income from continuing operations (a GAAP
measure), excluding restructuring costs, acquisition accounting
adjustments and other significant items. Adjusted EPS represents
diluted earnings per share from continuing operations (a GAAP
measure), excluding restructuring costs, acquisition accounting
adjustments and other significant items. For the Business segments,
when applicable, adjustments of net sales similarly reflect
continuing operations excluding other significant items, and
adjustments of operating profit (loss) and margins similarly
reflect continuing operations, excluding restructuring, acquisition
accounting adjustments and other significant items.
Free cash flow is a non-GAAP financial measure that represents
cash flow from operations (a GAAP measure) less capital
expenditures. Management believes free cash flow is a useful
measure of liquidity and an additional basis for assessing RTC's
ability to fund its activities, including the financing of
acquisitions, debt service, repurchases of RTC's common stock and
distribution of earnings to shareowners.
A reconciliation of the non-GAAP measures to the corresponding
amounts prepared in accordance with GAAP appears in the tables in
this Appendix. The tables provide additional information as to the
items and amounts that have been excluded from the adjusted
measures.
When we provide our expectation for adjusted EPS and free cash
flow on a forward-looking basis, a reconciliation of the
differences between the non-GAAP expectations and the corresponding
GAAP measures (expected diluted EPS from continuing operations and
expected cash flow from operations, respectively) generally is not
available without unreasonable effort due to potentially high
variability, complexity and low visibility as to the items that
would be excluded from the GAAP measure in the relevant future
period, such as unusual gains and losses, the ultimate outcome of
pending litigation, fluctuations in foreign currency exchange
rates, the impact and timing of potential acquisitions and
divestitures, and other structural changes or their probable
significance. The variability of the excluded items may have a
significant, and potentially unpredictable, impact on our future
GAAP results.
Cautionary Statement Regarding Forward-Looking
Statements
This press release contains statements which, to
the extent they are not statements of historical or present fact,
constitute "forward-looking statements" under the securities laws.
From time to time, oral or written forward-looking statements may
also be included in other information released to the public. These
forward-looking statements are intended to provide Raytheon
Technologies Corporation's ("RTC") management's current
expectations or plans for our future operating and financial
performance, based on assumptions currently believed to be valid.
Forward-looking statements can be identified by the use of words
such as "believe," "expect," "expectations," "plans," "strategy,"
"prospects," "estimate," "project," "target," "anticipate," "will,"
"should," "see," "guidance," "outlook," "confident," "on track" and
other words of similar meaning. Forward-looking statements may
include, among other things, statements relating to future sales,
earnings, cash flow, results of operations, uses of cash, share
repurchases, tax payments and rates, research and development
spending, other measures of financial performance, potential future
plans, strategies or transactions, credit ratings and net
indebtedness, other anticipated benefits to RTC of United
Technologies Corporation's ("UTC") Rockwell Collins acquisition,
the merger between UTC and Raytheon Company ("Raytheon," and such
merger, the "merger") or the spin-offs by UTC of Otis Worldwide
Corporation and Carrier Global Corporation into separate
independent companies (the "separation transactions"), including
estimated synergies and customer cost savings resulting from the
merger and the anticipated benefits and costs of the separation
transactions and other statements that are not solely historical
facts. All forward-looking statements involve risks, uncertainties
and other factors that may cause actual results to differ
materially from those expressed or implied in the forward-looking
statements. For those statements, we claim the protection of the
safe harbor for forward-looking statements contained in the U.S.
Private Securities Litigation Reform Act of 1995. Such risks,
uncertainties and other factors include, without limitation: (1)
the effect of economic conditions in the industries and markets in
which RTC operates in the U.S. and globally and any changes
therein, including financial market conditions, fluctuations in
commodity prices, interest rates and foreign currency exchange
rates, levels of end market demand in both the commercial and
defense segments of the aerospace industry, levels of air travel,
financial condition of commercial airlines, and the impact of
pandemic health issues (including COVID-19 and its effects, among
other things, on global supply, demand and distribution
capabilities as the COVID-19 pandemic continues and results in an
increasingly prolonged period of disruption to air travel and
commercial activities generally, and significant restrictions and
limitations on businesses, particularly within the aerospace and
commercial airlines industries) aviation safety concerns, weather
conditions and natural disasters, the financial condition of our
customers and suppliers, and the risks associated with U.S.
government sales (including changes or shifts in defense spending
due to budgetary constraints, spending cuts resulting from
sequestration or the allocation of funds to governmental responses
to COVID-19, a government shutdown, or otherwise, and uncertain
funding of programs); (2) challenges in the development,
production, delivery, support, performance, safety, regulatory
compliance, and realization of the anticipated benefits (including
our expected returns under customer contracts) of advanced
technologies and new products and services; (3) the scope, nature,
impact or timing of acquisition and divestiture activity, including
among other things the integration of UTC's and Raytheon Company's
businesses and the integration of RTC with other businesses
acquired before and after the merger, and realization of synergies
and opportunities for growth and innovation and incurrence of
related costs and expenses; (4) RTC's levels of indebtedness,
capital spending and research and development spending; (5) future
availability of credit and factors that may affect such
availability, including credit market conditions and our capital
structure; (6) the timing and scope of future repurchases by RTC of
its common stock, which are subject to a number of uncertainties
and may be discontinued, accelerated, suspended or delayed at any
time due to various factors, including market conditions and the
level of other investing activities and uses of cash; (7) delays
and disruption in delivery of materials and services from
suppliers; (8) company and customer-directed cost reduction efforts
and restructuring costs and savings and other consequences thereof
(including the potential termination of U.S. government contracts
and performance under undefinitized contract actions and the
potential inability to recover termination costs); (9) new business
and investment opportunities; (10) the ability to realize the
intended benefits of organizational changes; (11) the anticipated
benefits of diversification and balance of operations across
product lines, regions and industries; (12) the outcome of legal
proceedings, investigations and other contingencies; (13) pension
plan assumptions and future contributions; (14) the impact of the
negotiation of collective bargaining agreements and labor disputes;
(15) the effect of changes in political conditions in the U.S. and
other countries in which RTC and its businesses operate, including
the effect of changes in U.S. trade policies on general market
conditions, global trade policies and currency exchange rates in
the near term and beyond; (16) changes resulting from the recent
change in the U.S. Administration and potential changes in
Department of Defense policies or priorities; (17) the effect of
changes in tax (including U.S. tax reform enacted on December 22, 2017, which is commonly referred to
as the Tax Cuts and Jobs Act of 2017), environmental, regulatory
and other laws and regulations (including, among other things,
export and import requirements such as the International Traffic in
Arms Regulations and the Export Administration Regulations,
anti-bribery and anticorruption requirements, including the Foreign
Corrupt Practices Act, industrial cooperation agreement
obligations, and procurement and other regulations) in the U.S. and
other countries in which RTC and its businesses operate; (18) the
possibility that the anticipated benefits from the combination of
UTC's and Raytheon's businesses (including ongoing integration
activities from historic UTC and Raytheon acquisitions prior to the
merger) cannot be realized in full or may take longer to realize
than expected, or the possibility that costs or difficulties
related to the integration of UTC's businesses with Raytheon's will
be greater than expected or may not result in the achievement of
estimated synergies within the contemplated time frame or at all;
(19) the ability of RTC to retain and hire key personnel and the
ability of our personnel to continue to operate our facilities and
businesses around the world in light of, among other factors, the
COVID-19 pandemic and related personnel reductions; and (20) the
intended qualification of (i) the merger as a tax-free
reorganization and (ii) the separation transactions and other
internal restructurings as tax-free to UTC and former UTC
shareowners, in each case, for U.S. federal income tax purposes.
For additional information on identifying factors that may cause
actual results to vary materially from those stated in
forward-looking statements, see the reports of RTC, UTC and
Raytheon on Forms S-4, 10-K, 10-Q and 8-K filed with or furnished
to the Securities and Exchange Commission from time to time. Any
forward-looking statement speaks only as of the date on which it is
made, and RTC assumes no obligation to update or revise such
statement, whether as a result of new information, future events or
otherwise, except as required by applicable law.
RTC-IR
Media Contact
860.493.4364
Investor Contact
781.522.5123
Raytheon
Technologies Corporation
Condensed
Consolidated Statement of Operations
|
|
|
|
Quarter Ended
March 31,
|
|
|
(Unaudited)
|
(dollars in
millions, except per share amounts; shares in
millions)
|
2021
|
|
2020(1)
|
Net Sales
|
$
|
15,251
|
|
|
$
|
11,360
|
|
Costs and
Expenses:
|
|
|
|
|
Cost of
sales
|
12,537
|
|
|
8,572
|
|
|
Research and
development
|
589
|
|
|
535
|
|
|
Selling, general and
administrative
|
1,220
|
|
|
977
|
|
|
Total Costs and
Expenses
|
14,346
|
|
|
10,084
|
|
Other income,
net
|
108
|
|
|
19
|
|
Operating
profit
|
1,013
|
|
|
1,295
|
|
|
Non-service pension
benefit
|
(491)
|
|
|
(168)
|
|
|
Interest expense,
net
|
346
|
|
|
332
|
|
Income from
continuing operations before income taxes
|
1,158
|
|
|
1,131
|
|
|
Income tax
expense
|
345
|
|
|
639
|
|
Net income from
continuing operations
|
813
|
|
|
492
|
|
|
Less: Noncontrolling
interest in subsidiaries' earnings from continuing
operations
|
41
|
|
|
54
|
|
Income from
continuing operations attributable to common shareowners
|
772
|
|
|
438
|
|
Discontinued
operations:
|
|
|
|
|
Loss from
discontinued operations, before tax
|
(20)
|
|
|
(176)
|
|
|
Income tax (benefit)
expense from discontinued operations
|
(1)
|
|
|
302
|
|
|
Net loss from
discontinued operations
|
(19)
|
|
|
(478)
|
|
|
Less: Noncontrolling
interest in subsidiaries' earnings from discontinued
operations
|
—
|
|
|
43
|
|
Loss from
discontinued operations attributable to common
shareowners
|
(19)
|
|
|
(521)
|
|
Net income (loss)
attributable to common shareowners
|
$
|
753
|
|
|
$
|
(83)
|
|
|
|
|
|
|
Earnings (loss) Per
Share attributable to common shareowners - Basic:
|
|
|
|
|
Income from
continuing operations
|
$
|
0.51
|
|
|
$
|
0.51
|
|
|
Loss from
discontinued operations
|
(0.01)
|
|
|
(0.61)
|
|
|
Net income (loss)
attributable to common shareowners
|
$
|
0.50
|
|
|
$
|
(0.10)
|
|
Earnings (loss) Per
Share attributable to common shareowners - Diluted:
|
|
|
|
|
Income from
continuing operations
|
$
|
0.51
|
|
|
$
|
0.50
|
|
|
Loss from
discontinued operations
|
(0.01)
|
|
|
(0.60)
|
|
|
Net income (loss)
attributable to common shareowners
|
$
|
0.50
|
|
|
$
|
(0.10)
|
|
|
|
|
|
|
Weighted Average
Shares Outstanding:
|
|
|
|
|
Basic
shares
|
1,511.1
|
|
|
858.4
|
|
|
Diluted
shares
|
1,514.1
|
|
|
865.8
|
|
|
|
(1)
|
As a result of the
spin-offs of Otis Worldwide Corporation and Carrier Global
Corporation into separate independent companies (the "Separation
Transactions"), we have reclassified prior year amounts for Otis
and Carrier as discontinued operations.
|
Raytheon
Technologies Corporation
Segment Net Sales
and Operating Profit
|
|
|
Quarter
Ended
|
|
(Unaudited)
|
|
March 31,
2021
|
|
March 31,
2020(1)
|
(dollars in
millions)
|
Reported
|
Adjusted
|
|
Reported
|
Adjusted
|
Net
Sales
|
|
|
|
|
|
Collins Aerospace
Systems
|
$
|
4,370
|
|
$
|
4,370
|
|
|
$
|
6,438
|
|
$
|
6,460
|
|
Pratt &
Whitney
|
4,030
|
|
4,030
|
|
|
5,353
|
|
5,331
|
|
Raytheon Intelligence
& Space
|
3,765
|
|
3,765
|
|
|
—
|
|
—
|
|
Raytheon Missiles
& Defense
|
3,793
|
|
3,793
|
|
|
—
|
|
—
|
|
Total
segments
|
15,958
|
|
15,958
|
|
|
11,791
|
|
11,791
|
|
Eliminations and
other
|
(707)
|
|
(707)
|
|
|
(431)
|
|
(431)
|
|
Consolidated
|
$
|
15,251
|
|
$
|
15,251
|
|
|
$
|
11,360
|
|
$
|
11,360
|
|
|
|
|
|
|
|
Operating
Profit
|
|
|
|
|
|
Collins Aerospace
Systems
|
$
|
314
|
|
$
|
332
|
|
|
$
|
1,246
|
|
$
|
1,284
|
|
Pratt &
Whitney
|
20
|
|
40
|
|
|
475
|
|
515
|
|
Raytheon Intelligence
& Space
|
388
|
|
388
|
|
|
—
|
|
—
|
|
Raytheon Missiles
& Defense
|
496
|
|
496
|
|
|
—
|
|
—
|
|
Total
segments
|
1,218
|
|
1,256
|
|
|
1,721
|
|
1,799
|
|
Eliminations and
other
|
(31)
|
|
(31)
|
|
|
(25)
|
|
(25)
|
|
Corporate expenses
and other unallocated items
|
(81)
|
|
(51)
|
|
|
(130)
|
|
(99)
|
|
FAS/CAS operating
adjustment
|
423
|
|
423
|
|
|
—
|
|
—
|
|
Acquisition
accounting adjustments
|
(516)
|
|
—
|
|
|
(271)
|
|
—
|
|
Consolidated
|
$
|
1,013
|
|
$
|
1,597
|
|
|
$
|
1,295
|
|
$
|
1,675
|
|
|
|
|
|
|
|
Segment Operating
Profit Margin
|
|
|
|
|
|
Collins Aerospace
Systems
|
7.2
|
%
|
7.6
|
%
|
|
19.4
|
%
|
19.9
|
%
|
Pratt &
Whitney
|
0.5
|
%
|
1.0
|
%
|
|
8.9
|
%
|
9.7
|
%
|
Raytheon Intelligence
& Space
|
10.3
|
%
|
10.3
|
%
|
|
NM
|
|
NM
|
|
Raytheon Missiles
& Defense
|
13.1
|
%
|
13.1
|
%
|
|
NM
|
|
NM
|
|
Total
segment
|
7.6
|
%
|
7.9
|
%
|
|
14.6
|
%
|
15.3
|
%
|
|
|
(1)
|
Legacy UTC segments
have been recast for the first quarter 2020, as a result of the
Separation Transactions and the merger between UTC and Raytheon
Company (the Raytheon Merger), which resulted in the
reclassification of amounts for Otis and Carrier as discontinued
operations and revisions to the Company's measurement of segment
operating profit.
|
|
NM Not
Meaningful
|
Raytheon
Technologies Corporation
Condensed
Consolidated Balance Sheet
|
|
|
March 31,
2021
|
|
December 31,
2020
|
(dollars in
millions)
|
(Unaudited)
|
|
(Unaudited)
|
Assets
|
|
|
|
Cash and cash
equivalents
|
$
|
8,579
|
|
|
$
|
8,802
|
|
Accounts receivable,
net
|
10,037
|
|
|
9,254
|
|
Contract
assets
|
10,238
|
|
|
9,931
|
|
Inventory,
net
|
9,498
|
|
|
9,411
|
|
Other assets,
current
|
4,200
|
|
|
5,978
|
|
Total Current
Assets
|
42,552
|
|
|
43,376
|
|
Customer financing
assets
|
3,079
|
|
|
3,144
|
|
Fixed assets,
net
|
14,742
|
|
|
14,962
|
|
Operating lease
right-of-use assets
|
1,913
|
|
|
1,880
|
|
Goodwill
|
54,265
|
|
|
54,285
|
|
Intangible assets,
net
|
39,999
|
|
|
40,539
|
|
Other
assets
|
4,058
|
|
|
3,967
|
|
Total
Assets
|
$
|
160,608
|
|
|
$
|
162,153
|
|
|
|
|
|
Liabilities,
Redeemable Noncontrolling Interest and Equity
|
|
|
|
Short-term
borrowings
|
$
|
234
|
|
|
$
|
247
|
|
Accounts
payable
|
9,182
|
|
|
8,639
|
|
Accrued employee
compensation
|
2,511
|
|
|
3,006
|
|
Other accrued
liabilities
|
10,184
|
|
|
10,517
|
|
Contract
liabilities
|
12,879
|
|
|
12,889
|
|
Long-term debt
currently due
|
1,369
|
|
|
550
|
|
Total Current
Liabilities
|
36,359
|
|
|
35,848
|
|
Long-term
debt
|
29,935
|
|
|
31,026
|
|
Operating lease
liabilities, non-current
|
1,552
|
|
|
1,516
|
|
Future pension and
postretirement benefit obligations
|
9,808
|
|
|
10,342
|
|
Other long-term
liabilities
|
9,612
|
|
|
9,537
|
|
Total
Liabilities
|
87,266
|
|
|
88,269
|
|
Redeemable
noncontrolling interest
|
34
|
|
|
32
|
|
Shareowners'
Equity:
|
|
|
|
Common
Stock
|
36,951
|
|
|
36,881
|
|
Treasury
Stock
|
(10,780)
|
|
|
(10,407)
|
|
Retained
earnings
|
49,460
|
|
|
49,423
|
|
Accumulated other
comprehensive loss
|
(3,921)
|
|
|
(3,734)
|
|
Total Shareowners'
Equity
|
71,710
|
|
|
72,163
|
|
Noncontrolling
interest
|
1,598
|
|
|
1,689
|
|
Total
Equity
|
73,308
|
|
|
73,852
|
|
Total Liabilities,
Redeemable Noncontrolling Interest and Equity
|
$
|
160,608
|
|
|
$
|
162,153
|
|
Raytheon
Technologies Corporation
Condensed
Consolidated Statement of Cash Flows
|
|
|
Quarter Ended
March 31,
|
|
(Unaudited)
|
(dollars in
millions)
|
2021
|
|
2020(1)
|
Operating
Activities:
|
|
|
|
Net income from
continuing operations
|
$
|
813
|
|
|
$
|
492
|
|
Adjustments to
reconcile net income from continuing operations to net cash flows
provided by operating activities:
|
Depreciation and
amortization
|
1,123
|
|
|
728
|
|
Deferred income tax
provision
|
153
|
|
|
392
|
|
Stock compensation
cost
|
84
|
|
|
63
|
|
Net periodic pension
and other postretirement income
|
(358)
|
|
|
(130)
|
|
Change in:
|
|
|
|
Accounts
receivable
|
(799)
|
|
|
390
|
|
Contract
assets
|
(311)
|
|
|
(349)
|
|
Inventory
|
(113)
|
|
|
(395)
|
|
Other current
assets
|
(193)
|
|
|
(208)
|
|
Accounts payable and
accrued liabilities
|
538
|
|
|
612
|
|
Contract
liabilities
|
(56)
|
|
|
(101)
|
|
Global pension
contributions
|
(7)
|
|
|
(8)
|
|
Other operating
activities, net
|
(151)
|
|
|
(354)
|
|
Net cash flows
provided by operating activities from continuing
operations
|
723
|
|
|
1,132
|
|
Investing
Activities:
|
|
|
|
Capital
expenditures
|
(387)
|
|
|
(325)
|
|
Investments in
businesses
|
(6)
|
|
|
—
|
|
Dispositions of
businesses, net of cash transferred
|
1,049
|
|
|
—
|
|
Increase in customer
financing assets, net
|
(81)
|
|
|
(88)
|
|
Increase in
collaboration intangible assets
|
(32)
|
|
|
(78)
|
|
Receipts (payments)
from settlements of derivative contracts, net
|
49
|
|
|
(524)
|
|
Other investing
activities, net
|
(10)
|
|
|
(25)
|
|
Net cash flows
provided by (used in) investing activities from continuing
operations
|
582
|
|
|
(1,040)
|
|
Financing
Activities:
|
|
|
|
Distribution from
discontinued operations
|
—
|
|
|
17,207
|
|
Repayment of long-term
debt
|
(286)
|
|
|
(13,810)
|
|
Decrease in short-term
borrowings, net
|
(13)
|
|
|
(663)
|
|
Proceeds from Common
Stock issued under employee stock plans
|
1
|
|
|
6
|
|
Dividends paid on
Common Stock
|
(705)
|
|
|
(614)
|
|
Repurchase of Common
Stock
|
(375)
|
|
|
(47)
|
|
Net transfers to
discontinued operations
|
(5)
|
|
|
(1,016)
|
|
Other financing
activities, net
|
(161)
|
|
|
(23)
|
|
Net cash flows (used
in) provided by financing activities from continuing
operations
|
(1,544)
|
|
|
1,040
|
|
Discontinued
Operations:
|
|
|
|
Net cash used in
operating activities
|
(5)
|
|
|
(472)
|
|
Net cash used in
investing activities
|
—
|
|
|
(241)
|
|
Net cash provided by
financing activities
|
5
|
|
|
322
|
|
Net cash flows used in
discontinued operations
|
—
|
|
|
(391)
|
|
Effect of foreign
exchange rate changes on cash and cash equivalents from continuing
operations
|
23
|
|
|
(19)
|
|
Effect of foreign
exchange rate changes on cash and cash equivalents from
discontinued operations
|
—
|
|
|
(76)
|
|
Net (decrease)
increase in cash, cash equivalents and restricted cash
|
(216)
|
|
|
646
|
|
Cash, cash equivalents
and restricted cash, beginning of period
|
8,832
|
|
|
4,961
|
|
Cash, cash equivalents
and restricted cash within assets related to discontinued
operations, beginning of period
|
—
|
|
|
2,459
|
|
Cash, cash equivalents
and restricted cash, end of period
|
8,616
|
|
|
8,066
|
|
Less: Restricted cash,
included in Other assets
|
37
|
|
|
48
|
|
Less: Cash, cash
equivalents and restricted cash for discontinued
operations
|
—
|
|
|
1,993
|
|
Cash and cash
equivalents, end of period
|
$
|
8,579
|
|
|
$
|
6,025
|
|
|
|
(1)
|
As a result of the
Separation Transactions and the Raytheon Merger, certain
reclassifications have been made to the prior year amounts to
conform to the current year presentation. These reclassifications
include the reclassification of the historical Otis and Carrier
results to discontinued operations and the reclassification of
lease amortization within our presentation of cash
flows.
|
Raytheon
Technologies Corporation
Reconciliation of
Reported (GAAP) to Adjusted (Non-GAAP) Results
Adjusted Sales,
Adjusted Operating Profit & Operating Profit
Margin
|
|
|
Quarter Ended
March 31,
|
|
(Unaudited)
|
(dollars in
millions - Income (Expense))
|
2021
|
|
2020
|
Collins Aerospace
Systems
|
|
|
|
Net sales
|
$
|
4,370
|
|
|
$
|
6,438
|
|
Significant
unfavorable contract adjustments(1)
|
—
|
|
|
(22)
|
|
Adjusted net
sales
|
$
|
4,370
|
|
|
$
|
6,460
|
|
|
|
|
|
Operating
profit
|
$
|
314
|
|
|
$
|
1,246
|
|
Restructuring
|
(18)
|
|
|
(6)
|
|
Significant
unfavorable contract adjustments(1)
|
—
|
|
|
(22)
|
|
Charges related to
customer bankruptcies and collectability
risk(1)
|
—
|
|
|
(10)
|
|
Adjusted operating
profit
|
$
|
332
|
|
|
$
|
1,284
|
|
Adjusted operating
profit margin
|
7.6
|
%
|
|
19.9
|
%
|
Pratt &
Whitney
|
|
|
|
Net sales
|
$
|
4,030
|
|
|
$
|
5,353
|
|
Favorable impact of a
contract termination(1)
|
—
|
|
|
22
|
|
Adjusted net
sales
|
$
|
4,030
|
|
|
$
|
5,331
|
|
|
|
|
|
Operating
profit
|
$
|
20
|
|
|
$
|
475
|
|
Restructuring
|
(20)
|
|
|
—
|
|
Charges related to
customer bankruptcies and collectability
risk(1)
|
—
|
|
|
(62)
|
|
Favorable impact of a
contract termination(1)
|
—
|
|
|
22
|
|
Adjusted operating
profit
|
$
|
40
|
|
|
$
|
515
|
|
Adjusted operating
profit margin
|
1.0
|
%
|
|
9.7
|
%
|
Raytheon
Intelligence & Space
|
|
|
|
Net sales
|
$
|
3,765
|
|
|
$
|
—
|
|
|
|
|
|
Operating
profit
|
$
|
388
|
|
|
$
|
—
|
|
Operating profit
margin
|
10.3
|
%
|
|
—
|
%
|
Raytheon Missiles
& Defense
|
|
|
|
Net sales
|
$
|
3,793
|
|
|
$
|
—
|
|
|
|
|
|
Operating
profit
|
$
|
496
|
|
|
$
|
—
|
|
Operating profit
margin
|
13.1
|
%
|
|
—
|
%
|
Eliminations and
Other
|
|
|
|
Net sales
|
$
|
(707)
|
|
|
$
|
(431)
|
|
|
|
|
|
Operating
loss
|
$
|
(31)
|
|
|
$
|
(25)
|
|
Restructuring
|
—
|
|
|
(1)
|
|
Adjusted operating
profit
|
$
|
(31)
|
|
|
$
|
(24)
|
|
Corporate expenses
and other unallocated items
|
|
|
|
Operating
loss
|
$
|
(81)
|
|
|
$
|
(130)
|
|
Restructuring
|
(5)
|
|
|
(1)
|
|
Costs associated with
the separation of the commercial businesses
|
(8)
|
|
|
—
|
|
Transaction and
integration costs associated with the Raytheon Merger
|
(17)
|
|
|
(29)
|
|
Adjusted operating
loss
|
$
|
(51)
|
|
|
$
|
(100)
|
|
FAS/CAS Operating
Adjustment
|
|
|
|
Operating
Profit
|
$
|
423
|
|
|
$
|
—
|
|
Acquisition
Accounting Adjustments
|
|
|
|
Operating
loss
|
$
|
(516)
|
|
|
$
|
(271)
|
|
Intangible
impairment(1)
|
—
|
|
|
(40)
|
|
Acquisition accounting
adjustments
|
(516)
|
|
|
(231)
|
|
Adjusted operating
profit
|
$
|
—
|
|
|
$
|
—
|
|
RTC
Consolidated
|
|
|
|
Net sales
|
$
|
15,251
|
|
|
$
|
11,360
|
|
Favorable impact of a
contract termination
|
—
|
|
|
22
|
|
Significant
unfavorable contract adjustments
|
—
|
|
|
(22)
|
|
Adjusted net
sales
|
$
|
15,251
|
|
|
$
|
11,360
|
|
|
|
|
|
Operating
profit
|
$
|
1,013
|
|
|
$
|
1,295
|
|
Restructuring
|
(43)
|
|
|
(8)
|
|
Acquisition accounting
adjustments
|
(516)
|
|
|
(231)
|
|
Total significant
non-recurring and non-operational items included in Operating
Profit above
|
(25)
|
|
|
(141)
|
|
Adjusted operating
profit
|
$
|
1,597
|
|
|
$
|
1,675
|
|
|
|
(1)
|
Total significant
non-recurring and non-operational items in the table above for the
quarter ended March 31, 2020 includes a net pre-tax charge of $0.1
billion related to the impact of the COVID-19 pandemic, primarily
consisting of charges related to customer bankruptcies and
collectability risks. In the quarter ended June 30, 2020,
management determined that these operational items were directly
attributable to the COVID-19 pandemic and would be significant to
our 2020 results, and as such, we retrospectively revised Collins
Aerospace System's and Pratt & Whitney's adjustments for Q1
2020 to include them and continued to make adjustments for similar
items through the remainder of 2020. Management determined these
items are incremental to similar costs (or income) incurred for
reasons other than the pandemic and not expected to recur once the
impact of the pandemic has subsided, and therefore, not indicative
of the Company's ongoing operational performance and appropriate
for adjustment in the applicable periods. Our preliminary
assessment is that similar items are not expected to be significant
to our 2021 results, and therefore, we have not adjusted for such
items in the quarter ended March 31, 2021.
|
Raytheon
Technologies Corporation
Reconciliation of
Reported (GAAP) to Adjusted (Non-GAAP) Results
Adjusted Income
from Continuing Operations, Earnings Per Share, Weighted Average
Diluted Shares Outstanding and Effective Tax Rate
|
|
|
Quarter Ended
March 31,
|
|
(Unaudited)
|
(dollars and
shares in millions - Income (Expense))
|
2021
|
|
2020
|
Income from
continuing operations attributable to common
shareowners
|
$
|
772
|
|
|
$
|
438
|
|
Total
Restructuring
|
(43)
|
|
|
(8)
|
|
Total Acquisition
accounting adjustments
|
(516)
|
|
|
(231)
|
|
Total significant
non-recurring and non-operational items included in Operating
Profit
|
(25)
|
|
|
(141)
|
|
Tax effect of
restructuring and significant non-recurring and non-operational
items above
|
134
|
|
|
82
|
|
Significant
non-recurring and non-operational items included in Income Tax
Expense
|
|
|
|
Tax impact from
business disposal
|
(148)
|
|
|
—
|
|
Tax benefit (expenses)
associated with the Company's separation of Otis and
Carrier
|
—
|
|
|
(415)
|
|
Less: Impact on net
income attributable to common shareowners
|
(598)
|
|
|
(713)
|
|
Adjusted income
from continuing operations attributable to common
shareowners
|
$
|
1,370
|
|
|
$
|
1,151
|
|
|
|
|
|
Diluted Earnings
Per Share
|
$
|
0.51
|
|
|
$
|
0.50
|
|
Impact on Diluted
Earnings Per Share
|
(0.39)
|
|
|
(0.83)
|
|
Adjusted Diluted
Earnings Per Share
|
$
|
0.90
|
|
|
$
|
1.33
|
|
|
|
|
|
Effective Tax
Rate
|
29.8
|
%
|
|
56.5
|
%
|
Impact on Effective
Tax Rate
|
(10.8)
|
%
|
|
(36.2)
|
%
|
Adjusted Effective
Tax Rate
|
19.0
|
%
|
|
20.3
|
%
|
Raytheon
Technologies Corporation
Free Cash Flow
Reconciliation
|
|
|
Quarter Ended
March 31,
|
|
(Unaudited)
|
(dollars in
millions)
|
2021
|
|
2020
|
|
|
|
|
Net cash flows
provided by operating activities from continuing
operations
|
$
|
723
|
|
|
$
|
1,132
|
|
Capital
expenditures
|
(387)
|
|
|
(325)
|
|
Free cash
flow
|
$
|
336
|
|
|
$
|
807
|
|
View original
content:http://www.prnewswire.com/news-releases/raytheon-technologies-reports-first-quarter-2021-results-sales-adjusted-eps-and-free-cash-flow-exceeded-expectations-301277356.html
SOURCE Raytheon Technologies