RTX delivers strong 12% sales growth; Q1 book-to-bill of
1.34 with an RTX record backlog of $202B; Reaffirms full year
outlook
ARLINGTON, Va., April 23,
2024 /PRNewswire/ -- RTX (NYSE: RTX) reported first
quarter 2024 results.
First quarter 2024
- Sales of $19.3 billion, up 12
percent versus prior year on a reported and organic* basis
- GAAP EPS of $1.28, up 32 percent
versus prior year, which included $0.29 of acquisition accounting adjustments and a
$0.23 benefit from net significant
and/or non-recurring items and restructuring
- Adjusted EPS* of $1.34, up 10
percent versus prior year
- Operating cash flow of $0.3
billion; Free cash outflow* of $0.1
billion
- Gross proceeds of $1.3 billion
from the completion of the divestiture of Raytheon's Cybersecurity,
Intelligence and Services business
- Company backlog of $202 billion;
including $125 billion of commercial
and $77 billion of defense
- Realized $105 million of
incremental RTX gross cost synergies
Reaffirms outlook for full year 2024
- Sales of $78.0 - $79.0 billion
- Adjusted EPS* of $5.25 -
$5.40
- Free cash flow* of approximately $5.7
billion
"RTX saw strong momentum in the first quarter, delivering 12
percent organic sales* growth and winning over $25 billion in new orders across our businesses,"
said RTX President and Chief Operating Officer Chris Calio. "We are making progress on our key
priorities to deliver for customers and shareowners, including
executing on our GTF fleet management plans, which remain on
track."
"We're operating in one of the strongest demand periods in our
history with a record $202 billion
backlog and a portfolio of products and services which are fully
aligned to our customers' top priorities. Our focus on execution
and driving performance and margin expansion is supported by our
CORE operating system, and we continue to invest in operational
modernization and production capacity, digital transformation and
technological innovation to sustain our growth well into the
future."
First quarter 2024
RTX reported first quarter sales of $19.3
billion, up 12 percent over the prior year. GAAP EPS of
$1.28 was up 32 percent versus the
prior year, and included $0.29 of
acquisition accounting adjustments, a $0.21 benefit related to tax audit settlements,
an $0.18 net gain related to the
Cybersecurity, Intelligence and Services divestiture, a
$0.13 charge associated with
initiating alternative titanium sources, and $0.03 of restructuring and other net significant
and/or non-recurring charges. Adjusted EPS* of $1.34 was up 10 percent versus the prior
year.
The company recorded net income attributable to common
shareowners in the first quarter of $1.7
billion which included $389
million of acquisition accounting adjustments, a benefit of
$285 million related to tax audit
settlements, a net gain of $241
million related to the Cybersecurity, Intelligence and
Services divestiture, a $175 million
charge associated with initiating alternative titanium sources, and
$44 million of restructuring and
other net significant and/or non-recurring charges. Adjusted net
income* of $1.8 billion was flat
versus prior year as growth in adjusted segment operating profit*
was more than offset by higher interest expense and lower pension
income. Operating cash flow in the first quarter was $342 million. Capital expenditures were
$467 million, resulting in a free
cash outflow* of $125 million.
Summary Financial Results – Operations Attributable to Common
Shareowners
|
|
1st
Quarter
|
($ in millions, except
EPS)
|
2024
|
|
2023
|
%
Change
|
Reported
|
|
|
|
|
|
Sales
|
$
19,305
|
|
$
17,214
|
12 %
|
Net Income
|
$ 1,709
|
|
$ 1,426
|
20 %
|
EPS
|
$
1.28
|
|
$
0.97
|
32 %
|
|
|
|
|
|
|
Adjusted*
|
|
|
|
|
|
Sales
|
$
19,305
|
|
$
17,214
|
12 %
|
Net Income
|
$ 1,791
|
|
$ 1,793
|
— %
|
EPS
|
$
1.34
|
|
$
1.22
|
10 %
|
|
|
|
|
|
|
Operating Cash
Flow
|
|
$
342
|
|
$
(863)
|
NM
|
Free Cash
Flow*
|
|
$
(125)
|
|
$
(1,383)
|
NM
|
NM = not
meaningful
|
|
|
|
|
|
Backlog and Bookings
Backlog at the end of the first
quarter was $202 billion, of which
$125 billion was from commercial
aerospace and $77 billion was from
defense.
Notable defense bookings during the quarter included:
- $1.6 billion of classified
bookings at Raytheon
- $1.2 billion for Germany Patriot
production at Raytheon
- $818 million for NATO GEM-T
production at Raytheon
- $623 million for international
GEM-T production at Raytheon
- $282 million for Ukraine NASAMS
production at Raytheon
- $251 million for international
GEM-T production at Raytheon
Segment Results
The company's reportable segments are
Collins Aerospace, Pratt & Whitney, and Raytheon.
Collins Aerospace
|
1st
Quarter
|
($ in
millions)
|
2024
|
|
2023
|
%
Change
|
Reported
|
|
|
|
|
|
Sales
|
$
6,673
|
|
$
6,120
|
9 %
|
|
Operating
Profit
|
$ 849
|
|
$ 897
|
(5) %
|
|
ROS
|
12.7 %
|
|
14.7 %
|
(200)
|
bps
|
|
|
|
|
|
|
Adjusted*
|
|
|
|
|
|
Sales
|
$
6,673
|
|
$
6,120
|
9 %
|
|
Operating
Profit
|
$
1,048
|
|
$ 903
|
16 %
|
|
ROS
|
15.7 %
|
|
14.8 %
|
90
|
bps
|
Collins Aerospace had first quarter 2024 reported sales of
$6,673 million, up 9 percent versus
the prior year. The increase in sales was driven by a 14
percent increase in both commercial aftermarket and commercial OE,
and a 1 percent increase in defense. The increase in commercial
sales was driven primarily by strong demand across commercial
aerospace end markets, which resulted in higher flight hours and
higher OE production rates. The increase in defense sales was
driven primarily by higher volume.
Collins Aerospace recorded operating profit of $849 million, down 5 percent versus the prior
year. Reported operating profit included $175 million of charges related to unfavorable
purchase commitments and an impairment charge as a result of
initiating alternative titanium sources. On an adjusted basis,
operating profit* of $1,048 million
was up 16 percent versus the prior year. The increase in adjusted
operating profit* was primarily driven by drop through on higher
commercial aftermarket volume, partially offset by unfavorable OE
mix, higher space program costs and increased R&D expense.
Pratt & Whitney
|
1st
Quarter
|
($ in
millions)
|
2024
|
|
2023
|
%
Change
|
Reported
|
|
|
|
|
|
Sales
|
$
6,456
|
|
$
5,230
|
23 %
|
|
Operating
Profit
|
$ 412
|
|
$ 415
|
(1) %
|
|
ROS
|
6.4 %
|
|
7.9 %
|
(150)
|
bps
|
|
|
|
|
|
|
Adjusted*
|
|
|
|
|
|
Sales
|
$
6,456
|
|
$
5,230
|
23 %
|
|
Operating
Profit
|
$ 430
|
|
$ 434
|
(1) %
|
|
ROS
|
6.7 %
|
|
8.3 %
|
(160)
|
bps
|
Pratt & Whitney had first quarter 2024 reported sales of
$6,456 million, up 23 percent versus
the prior year. The increase in sales was driven by a 64 percent
increase in commercial OE, a 21 percent increase in military, and a
9 percent increase in commercial aftermarket. The increase in
commercial sales was primarily due to higher GTF OE volume and
favorable mix, and higher aftermarket volume. The increase in
military sales was driven by higher sustainment volume across
multiple platforms and higher development volume driven primarily
by the F135 Engine Core Upgrade program.
Pratt & Whitney recorded operating profit of $412 million, down 1 percent versus the prior
year. The benefit of favorable commercial OE mix and drop through
on higher commercial aftermarket volume was partially offset by
headwinds from increased commercial OE deliveries, unfavorable
commercial aftermarket mix, and the absence of a favorable
$60 million prior year contract
matter. Higher military volume and favorable mix was more than
offset by higher R&D and SG&A expenses. On an adjusted
basis, operating profit* of $430
million was down 1 percent versus the prior year.
Raytheon
|
1st
Quarter
|
($ in
millions)
|
2024
|
|
2023
|
%
Change
|
Reported
|
|
|
|
|
|
Sales
|
$
6,659
|
|
$
6,292
|
6 %
|
|
Operating
Profit
|
$ 996
|
|
$ 571
|
74 %
|
|
ROS
|
15.0 %
|
|
9.1 %
|
590
|
bps
|
|
|
|
|
|
|
Adjusted*
|
|
|
|
|
|
Sales
|
$
6,659
|
|
$
6,292
|
6 %
|
|
Operating
Profit
|
$ 630
|
|
$ 584
|
8 %
|
|
ROS
|
9.5 %
|
|
9.3 %
|
20
|
bps
|
Raytheon had first quarter 2024 reported sales of $6,659 million, up 6 percent versus prior year.
The increase in sales was primarily driven by higher volume on land
and air defense systems, including Global Patriot, counter-UAS
systems and NASAMS, and advanced technology programs.
Raytheon recorded operating profit of $996 million, up 74 percent versus the prior
year. The increase in operating profit was driven primarily by
higher volume and improved net productivity, partially offset by
unfavorable mix. Reported operating profit included a $375 million net gain on the sale of the
Cybersecurity, Intelligence, and Services business. On an adjusted
basis, operating profit* of $630
million was up 8 percent versus the prior year.
About RTX
With more than 185,000 global employees, RTX
pushes the limits of technology and science to redefine how we
connect and protect our world. Through industry-leading businesses
– Collins Aerospace, Pratt & Whitney, and Raytheon – we are
advancing aviation, engineering integrated defense systems, and
developing next-generation technology solutions and manufacturing
to help global customers address their most critical challenges.
The company, with 2023 sales of $69
billion, is headquartered in Arlington, Virginia.
Conference Call on the First Quarter 2024 Financial
Results
RTX's financial results conference call will be held
on Tuesday, April 23, 2024 at 8:30 a.m.
ET. The conference call will be webcast live on the
company's website at www.rtx.com and will be available for replay
following the call. The corresponding presentation slides will be
available for downloading prior to the call.
*Adjusted net sales, organic sales, adjusted operating profit
(loss) and margin, adjusted segment operating profit (loss) and
margin, adjusted net income, adjusted earnings per share ("EPS")
and free cash flow are non-GAAP financial measures. When we provide
our expectation for adjusted EPS and free cash flow on a
forward-looking basis, a reconciliation of these non-GAAP financial
measures to the corresponding GAAP measures (expected diluted EPS
and expected cash flow from operations) 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. See
"Use and Definitions of Non-GAAP Financial Measures" below for
information regarding non-GAAP financial measures.
Use and Definitions of Non-GAAP Financial
Measures
RTX Corporation ("RTX" or "the Company")
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. We believe that these non-GAAP measures provide investors
with additional insight into the Company's ongoing business
performance. 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. A
reconciliation of the non-GAAP measures to the corresponding
amounts prepared in accordance with GAAP appears in the tables in
this Appendix. Below are our non-GAAP financial measures:
Non-GAAP
measure
|
Definition
|
Adjusted net
sales
|
Represents consolidated
net sales (a GAAP measure), excluding net significant and/or
non-recurring items1 (hereinafter referred to as "net
significant and/or non-recurring items").
|
Organic
sales
|
Organic sales
represents the change in consolidated net sales (a GAAP measure),
excluding the impact of foreign currency translation, acquisitions
and divestitures completed in the preceding twelve months and net
significant and/or non-recurring items.
|
Adjusted operating
profit (loss) and margin
|
Adjusted operating
profit (loss) represents operating profit (loss) (a GAAP measure),
excluding restructuring costs, acquisition accounting adjustments
and net significant and/or non-recurring items. Adjusted operating
profit margin represents adjusted operating profit (loss) as a
percentage of adjusted net sales.
|
Segment operating
profit (loss) and margin
|
Segment operating
profit (loss) represents operating profit (loss) (a GAAP measure)
excluding Acquisition Accounting Adjustments2, the
FAS/CAS operating adjustment3, Corporate expenses and
other unallocated items, and Eliminations and other. Segment
operating profit margin represents segment operating profit (loss)
as a percentage of segment sales (net sales, excluding Eliminations
and other).
|
Adjusted segment
sales
|
Represents consolidated
net sales (a GAAP measure) excluding eliminations and other and net
significant and/or non-recurring items.
|
Adjusted segment
operating profit (loss) and margin
|
Adjusted segment
operating profit (loss) represents segment operating profit (loss)
excluding restructuring costs, and net significant and/or
non-recurring items. Adjusted segment operating profit margin
represents adjusted segment operating profit (loss) as a percentage
of adjusted segment sales (adjusted net sales excluding
Eliminations and other).
|
Adjusted net
income
|
Adjusted net income
represents net income (a GAAP measure), excluding restructuring
costs, acquisition accounting adjustments and net significant
and/or non-recurring items.
|
Adjusted earnings per
share (EPS)
|
Adjusted EPS represents
diluted earnings per share (a GAAP measure), excluding
restructuring costs, acquisition accounting adjustments and net
significant and/or non-recurring items.
|
Free cash
flow
|
Free cash flow
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 RTX's
ability to fund its activities, including the financing of
acquisitions, debt service, repurchases of RTX's common stock and
distribution of earnings to shareowners.
|
1 Net
significant and/or non-recurring items represent significant
nonoperational items and/or significant operational items that may
occur at irregular intervals.
|
|
2
Acquisition Accounting Adjustments include the amortization of
acquired intangible assets related to acquisitions, the
amortization of the property, plant and equipment fair value
adjustment acquired through acquisitions, the amortization of
customer contractual obligations related to loss making or below
market contracts acquired, and goodwill impairment, if
applicable.
|
|
3 The
FAS/CAS operating adjustment represents the difference between the
service cost component of our pension and postretirement benefit
(PRB) expense under the Financial Accounting Standards (FAS)
requirements of GAAP and our pension and PRB expense under U.S.
government Cost Accounting Standards (CAS) primarily related to our
Raytheon segment.
|
When we provide our expectation for adjusted net sales, organic
sales, adjusted operating profit (loss) and margin, adjusted
segment operating profit (loss) and margin, 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, as described above, generally are 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 RTX Corporation
("RTX") management's current expectations or plans for our future
operating and financial performance, based on assumptions currently
believed to be valid and are not statements of historical fact.
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," "goals," "objectives,"
"confident," "on track," "designed to" 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, cost
savings, other measures of financial performance, potential future
plans, strategies or transactions, credit ratings and net
indebtedness, the Pratt powder metal matter and related matters and
activities, including without limitation other engine models that
may be impacted, anticipated benefits to RTX of its segment
realignment, pending disposition Collins' actuation and flight
control business, the merger (the "merger") between United
Technologies Corporation ("UTC") and Raytheon Company ("Raytheon")
or the spin-offs by UTC of Otis Worldwide Corporation and Carrier
Global Corporation into separate independent companies (the
"separation transactions") in 2020, targets and commitments
(including for share repurchases or otherwise), 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
changes in economic, capital market and political conditions in the
U.S. and globally, such as from the global sanctions and export
controls with respect to Russia,
and any changes therein, including related to financial market
conditions, banking industry disruptions, fluctuations in commodity
prices or supply (including energy supply), inflation, interest
rates and foreign currency exchange rates, disruptions in global
supply chain and labor markets, and geopolitical risks; (2) risks
associated with U.S. government sales, including changes or shifts
in defense spending due to budgetary constraints, spending cuts
resulting from sequestration, a continuing resolution, a government
shutdown, the debt ceiling or measures taken to avoid default, or
otherwise, and uncertain funding of programs; (3) risks relating to
our performance on our contracts and programs, including our
ability to control costs, and our inability to pass some or all
costs on fixed price contracts through to the customer; (4)
challenges in the development, production, delivery, support, and
performance of RTX advanced technologies and new products and
services and the realization of the anticipated benefits (including
our expected returns under customer contracts), as well as the
challenges of operating in RTX's highly-competitive industries; (5)
risks relating to RTX's reliance on U.S. and non-U.S. suppliers and
commodity markets, including the effect of sanctions, delays and
disruptions in the delivery of materials and services to RTX or its
suppliers and price increases; (6) risks relating to RTX
international operations from, among other things, changes in trade
policies and implementation of sanctions, foreign currency
fluctuations, economic conditions, political factors, sales
methods, and U.S. or local government regulations; (7) the
condition of the aerospace industry; (8) the ability of RTX to
attract, train and retain qualified personnel and maintain its
culture and high ethical standards, and the ability of our
personnel to continue to operate our facilities and businesses
around the world; (9) the scope, nature, timing and challenges of
managing acquisitions, investments, divestitures and other
transactions, including the realization of synergies and
opportunities for growth and innovation, the assumption of
liabilities and other risks and incurrence of related costs and
expenses, and risks related to completion of announced
divestitures; (10) compliance with legal, environmental, regulatory
and other requirements, 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, such as the Foreign Corrupt
Practices Act, industrial cooperation agreement obligations, and
procurement and other regulations in the U.S. and other countries
in which RTX and its businesses operate; (11) the outcome of
pending, threatened and future legal proceedings, investigations
and other contingencies, including those related to U.S. government
audits and disputes; (12) factors that could impact RTX's ability
to engage in desirable capital-raising or strategic transactions,
including its credit rating, capital structure, levels of
indebtedness and related obligations, capital expenditures and
research and development spending, and capital deployment strategy
including with respect to share repurchases, and the availability
of credit, borrowing costs, credit market conditions, and other
factors; (13) uncertainties associated with the timing and scope of
future repurchases by RTX of its common stock, including the
ability to complete the accelerated share repurchase ("ASR"), the
purchase price of the shares acquired pursuant to the ASR
agreement, and the timing and duration of the ASR program or
declarations of cash dividends, which 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; (14) risks relating to
realizing expected benefits from, incurring costs for, and
successfully managing, the Company's segment realignment effective
July 1, 2023, and other RTX strategic
initiatives such as cost reduction, restructuring, digital
transformation and other operational initiatives; (15) risks of
additional tax exposures due to new tax legislation or other
developments, in the U.S. and other countries in which RTX and its
businesses operate; (16) risks relating to addressing the
identified rare condition in powder metal used to manufacture
certain Pratt & Whitney engine parts requiring accelerated
removals and inspections of a significant portion of the PW1100G-JM
Geared Turbofan (GTF) fleet, including, without limitation, the
number and expected timing of shop visits, inspection results and
scope of work to be performed, turnaround time, availability of new
parts, available capacity at overhaul facilities, outcomes of
negotiations with impacted customers, and risks related to other
engine models that may be impacted by the powder metal matter, and
in each case the timing and costs relating thereto, as well as
other issues that could impact RTX product performance, including
quality, reliability or durability; (17) changes in production
volumes of one or more of our significant customers as a result of
business or other challenges, and the resulting effect on its or
their demand for our products and services; (18) risks relating to
a RTX product safety failure or other failure affecting RTX's or
its customers' or suppliers' products or systems; (19) risks
relating to cybersecurity, including cyber-attacks on RTX's
information technology infrastructure, products, suppliers,
customers and partners, and cybersecurity-related regulations; (20)
threats to RTX facilities and personnel, as well as other events
outside of RTX's control such as public health crises, damaging
weather or other acts of nature; (21) the effect of changes in
accounting estimates for our programs on our financial results;
(22) the effect of changes in pension and other postretirement plan
estimates and assumptions and contributions; (23) risks relating to
an impairment of goodwill and other intangible assets; (24) the
effects of climate change and changing climate-related regulations,
customer and market demands, products and technologies; and (25)
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 RTX, 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 RTX 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.
RTX
Corporation
Condensed
Consolidated Statement of Operations
|
|
|
|
Quarter Ended
March 31,
|
|
|
(Unaudited)
|
(dollars in
millions, except per share amounts; shares in
millions)
|
2024
|
|
2023
|
Net Sales
|
$ 19,305
|
|
$ 17,214
|
Costs and
expenses:
|
|
|
|
|
Cost of
sales
|
15,744
|
|
13,645
|
|
Research and
development
|
669
|
|
607
|
|
Selling, general, and
administrative
|
1,394
|
|
1,363
|
|
Total costs and
expenses
|
17,807
|
|
15,615
|
Other income,
net
|
372
|
|
88
|
Operating
profit
|
1,870
|
|
1,687
|
|
Non-service pension
income
|
(386)
|
|
(444)
|
|
Interest expense,
net
|
405
|
|
315
|
Income before income
taxes
|
1,851
|
|
1,816
|
|
Income tax
expense
|
108
|
|
335
|
Net income
|
1,743
|
|
1,481
|
|
Less: Noncontrolling
interest in subsidiaries' earnings
|
34
|
|
55
|
Net income attributable
to common shareowners
|
$
1,709
|
|
$
1,426
|
|
|
|
|
|
Earnings Per Share
attributable to common shareowners:
|
|
|
|
|
Basic
|
$
1.29
|
|
$
0.98
|
|
Diluted
|
$
1.28
|
|
$
0.97
|
|
|
|
|
|
Weighted Average Shares
Outstanding:
|
|
|
|
|
Basic shares
|
1,329.4
|
|
1,462.2
|
|
Diluted
shares
|
1,337.3
|
|
1,474.2
|
RTX
Corporation
Segment Net Sales
and Operating Profit (Loss)
|
|
|
Quarter
Ended
|
|
(Unaudited)
|
|
March 31,
2024
|
|
March 31,
2023
|
(dollars in
millions)
|
Reported
|
Adjusted
|
|
Reported
|
Adjusted
|
Net
Sales
|
|
|
|
|
|
Collins
Aerospace
|
$
6,673
|
$
6,673
|
|
$
6,120
|
$
6,120
|
Pratt &
Whitney
|
6,456
|
6,456
|
|
5,230
|
5,230
|
Raytheon
|
6,659
|
6,659
|
|
6,292
|
6,292
|
Total
segments
|
19,788
|
19,788
|
|
17,642
|
17,642
|
Eliminations and
other
|
(483)
|
(483)
|
|
(428)
|
(428)
|
Consolidated
|
$
19,305
|
$
19,305
|
|
$
17,214
|
$
17,214
|
|
|
|
|
|
|
Operating Profit
(Loss)
|
|
|
|
|
|
Collins
Aerospace
|
$ 849
|
$
1,048
|
|
$ 897
|
$ 903
|
Pratt &
Whitney
|
412
|
430
|
|
415
|
434
|
Raytheon
|
996
|
630
|
|
571
|
584
|
Total
segments
|
2,257
|
2,108
|
|
1,883
|
1,921
|
Eliminations and
other
|
(5)
|
(5)
|
|
51
|
(17)
|
Corporate expenses and
other unallocated items
|
(96)
|
(25)
|
|
(43)
|
(40)
|
FAS/CAS operating
adjustment
|
214
|
214
|
|
289
|
289
|
Acquisition accounting
adjustments
|
(500)
|
—
|
|
(493)
|
—
|
Consolidated
|
$
1,870
|
$
2,292
|
|
$
1,687
|
$
2,153
|
|
|
|
|
|
|
Segment Operating
Profit Margin
|
|
|
|
|
|
Collins
Aerospace
|
12.7 %
|
15.7 %
|
|
14.7 %
|
14.8 %
|
Pratt &
Whitney
|
6.4 %
|
6.7 %
|
|
7.9 %
|
8.3 %
|
Raytheon
|
15.0 %
|
9.5 %
|
|
9.1 %
|
9.3 %
|
Total
segment
|
11.4 %
|
10.7 %
|
|
10.7 %
|
10.9 %
|
RTX
Corporation
Condensed
Consolidated Balance Sheet
|
|
|
March 31,
2024
|
|
December 31,
2023
|
(dollars in
millions)
|
(Unaudited)
|
|
(Unaudited)
|
Assets
|
|
|
|
Cash and cash
equivalents
|
$
5,607
|
|
$
6,587
|
Accounts receivable,
net
|
10,280
|
|
10,838
|
Contract
assets
|
13,104
|
|
12,139
|
Inventory,
net
|
12,386
|
|
11,777
|
Other assets,
current
|
6,646
|
|
7,076
|
Total current
assets
|
48,023
|
|
48,417
|
Customer financing
assets
|
2,359
|
|
2,392
|
Fixed assets,
net
|
15,638
|
|
15,748
|
Operating lease
right-of-use assets
|
1,639
|
|
1,638
|
Goodwill
|
53,644
|
|
53,699
|
Intangible assets,
net
|
34,960
|
|
35,399
|
Other assets
|
3,924
|
|
4,576
|
Total
assets
|
$
160,187
|
|
$
161,869
|
|
|
|
|
Liabilities,
Redeemable Noncontrolling Interest, and Equity
|
|
|
|
Short-term
borrowings
|
$
166
|
|
$
189
|
Accounts
payable
|
10,522
|
|
10,698
|
Accrued employee
compensation
|
1,862
|
|
2,491
|
Other accrued
liabilities
|
15,006
|
|
14,917
|
Contract
liabilities
|
17,119
|
|
17,183
|
Long-term debt
currently due
|
344
|
|
1,283
|
Total current
liabilities
|
45,019
|
|
46,761
|
Long-term
debt
|
42,334
|
|
42,355
|
Operating lease
liabilities, non-current
|
1,410
|
|
1,412
|
Future pension and
postretirement benefit obligations
|
2,320
|
|
2,385
|
Other long-term
liabilities
|
6,967
|
|
7,511
|
Total
liabilities
|
98,050
|
|
100,424
|
Redeemable
noncontrolling interest
|
37
|
|
35
|
Shareowners'
Equity:
|
|
|
|
Common
stock
|
37,097
|
|
37,040
|
Treasury
stock
|
(27,029)
|
|
(26,977)
|
Retained
earnings
|
53,052
|
|
52,154
|
Accumulated other
comprehensive loss
|
(2,635)
|
|
(2,419)
|
Total shareowners'
equity
|
60,485
|
|
59,798
|
Noncontrolling
interest
|
1,615
|
|
1,612
|
Total
equity
|
62,100
|
|
61,410
|
Total liabilities,
redeemable noncontrolling interest, and equity
|
$
160,187
|
|
$
161,869
|
RTX
Corporation
Condensed
Consolidated Statement of Cash Flows
|
|
|
Quarter Ended
March 31,
|
|
(Unaudited)
|
(dollars in
millions)
|
2024
|
|
2023
|
Operating
Activities:
|
|
|
|
Net income
|
$
1,743
|
|
$
1,481
|
Adjustments to
reconcile net income to net cash flows provided by (used in)
operating activities:
|
|
|
|
Depreciation and
amortization
|
1,059
|
|
1,034
|
Deferred income tax
benefit
|
(114)
|
|
(329)
|
Stock compensation
cost
|
112
|
|
100
|
Net periodic pension
and other postretirement income
|
(338)
|
|
(388)
|
Gain on sale of
Cybersecurity, Intelligence and Services business, net of
transaction costs
|
(415)
|
|
—
|
Change in:
|
|
|
|
Accounts
receivable
|
431
|
|
(962)
|
Contract
assets
|
(978)
|
|
(1,198)
|
Inventory
|
(646)
|
|
(720)
|
Other current
assets
|
(225)
|
|
(526)
|
Accounts payable and
accrued liabilities
|
(218)
|
|
490
|
Contract
liabilities
|
(54)
|
|
223
|
Other operating
activities, net
|
(15)
|
|
(68)
|
Net cash flows
provided by (used in) operating activities
|
342
|
|
(863)
|
Investing
Activities:
|
|
|
|
Capital
expenditures
|
(467)
|
|
(520)
|
Dispositions of
businesses, net of cash transferred
|
1,283
|
|
—
|
Increase in other
intangible assets
|
(163)
|
|
(154)
|
Payments from
settlements of derivative contracts, net
|
(1)
|
|
(13)
|
Other investing
activities, net
|
41
|
|
108
|
Net cash flows
provided by (used in) investing activities
|
693
|
|
(579)
|
Financing
Activities:
|
|
|
|
Proceeds from
long-term debt
|
—
|
|
2,971
|
Repayment of long-term
debt
|
(950)
|
|
—
|
Change in commercial
paper, net
|
—
|
|
(427)
|
Change in other
short-term borrowings, net
|
(22)
|
|
22
|
Dividends paid on
common stock
|
(769)
|
|
(790)
|
Repurchase of common
stock
|
(56)
|
|
(562)
|
Other financing
activities, net
|
(210)
|
|
(118)
|
Net cash flows
(used in) provided by financing activities
|
(2,007)
|
|
1,096
|
Effect of foreign
exchange rate changes on cash and cash equivalents
|
(8)
|
|
1
|
Net decrease in
cash, cash equivalents and restricted cash
|
(980)
|
|
(345)
|
Cash, cash equivalents
and restricted cash, beginning of period
|
6,626
|
|
6,291
|
Cash, cash equivalents
and restricted cash, end of period
|
5,646
|
|
5,946
|
Less:
Restricted cash, included in Other assets, current and Other
assets
|
39
|
|
53
|
Cash and cash
equivalents, end of period
|
$
5,607
|
|
$
5,893
|
RTX
Corporation
Reconciliation of
Adjusted (Non-GAAP) Results
Adjusted Sales,
Adjusted Operating Profit & Operating Profit
Margin
|
|
|
Quarter Ended
March 31,
|
|
(Unaudited)
|
(dollars in
millions - Income (Expense))
|
2024
|
|
2023
|
Collins
Aerospace
|
|
|
|
Net sales
|
$ 6,673
|
|
$ 6,120
|
Operating
profit
|
$
849
|
|
$
897
|
Restructuring
|
(6)
|
|
(3)
|
Segment and portfolio
transformation costs
|
(18)
|
|
(3)
|
Charge associated with
initiating alternative titanium sources (1)
|
(175)
|
|
—
|
Adjusted operating
profit
|
$ 1,048
|
|
$
903
|
Adjusted operating
profit margin
|
15.7 %
|
|
14.8 %
|
Pratt &
Whitney
|
|
|
|
Net sales
|
$ 6,456
|
|
$ 5,230
|
Operating
profit
|
$
412
|
|
$
415
|
Restructuring
|
(18)
|
|
(19)
|
Adjusted operating
profit
|
$
430
|
|
$
434
|
Adjusted operating
profit margin
|
6.7 %
|
|
8.3 %
|
Raytheon
|
|
|
|
Net sales
|
$ 6,659
|
|
$ 6,292
|
Operating
profit
|
$
996
|
|
$
571
|
Restructuring
|
(9)
|
|
(7)
|
Gain on sale of
business, net of transaction and other related costs
(2)
|
375
|
|
—
|
Segment and portfolio
transformation costs
|
—
|
|
(6)
|
Adjusted operating
profit
|
$
630
|
|
$
584
|
Adjusted operating
profit margin
|
9.5 %
|
|
9.3 %
|
Eliminations and
Other
|
|
|
|
Net sales
|
$ (483)
|
|
$ (428)
|
Operating
loss
|
$
(5)
|
|
$
51
|
Gain on sale of
land
|
—
|
|
68
|
Adjusted operating
loss
|
$
(5)
|
|
$
(17)
|
Corporate expenses
and other unallocated items
|
|
|
|
Operating
loss
|
$
(96)
|
|
$
(43)
|
Restructuring
|
(1)
|
|
(1)
|
Tax audit settlements
(3)
|
(68)
|
|
—
|
Segment and portfolio
transformation costs
|
(2)
|
|
(2)
|
Adjusted operating
loss
|
$
(25)
|
|
$
(40)
|
FAS/CAS Operating
Adjustment
|
|
|
|
Operating
profit
|
$
214
|
|
$
289
|
Acquisition
Accounting Adjustments
|
|
|
|
Operating
loss
|
$ (500)
|
|
$ (493)
|
Acquisition accounting
adjustments
|
(500)
|
|
(493)
|
Adjusted operating
profit
|
$
—
|
|
$
—
|
RTX
Consolidated
|
|
|
|
Net sales
|
$
19,305
|
|
$
17,214
|
Operating
profit
|
$ 1,870
|
|
$ 1,687
|
Restructuring
|
(34)
|
|
(30)
|
Acquisition accounting
adjustments
|
(500)
|
|
(493)
|
Total net significant
and/or non-recurring items included in Operating profit
above(1)(2)(3)
|
112
|
|
57
|
Adjusted operating
profit
|
$ 2,292
|
|
$ 2,153
|
(1)
|
Total net significant
and/or non-recurring items in the table above for the quarter ended
March 31, 2024 includes a net pre-tax charge of $0.2 billion
related to the recognition of unfavorable purchase commitments and
an impairment of contract fulfillment costs associated with
initiating alternative titanium sources at Collins. These charges
were recorded as a result of the Canadian government's imposition
of new sanctions in February 2024, which included U.S.- and
German-based Russian-owned entities from which we source titanium
for use in our Canadian operations. Management has determined that
these impacts are directly attributable to the sanctions,
incremental to similar costs incurred for reasons other than those
related to the sanctions and has determined that the nature of the
charge is considered significant and unusual, and therefore, not
indicative of the Company's ongoing operational
performance.
|
(2)
|
Total net significant
and/or non-recurring items in the table above for the quarter ended
March 31, 2024 includes a pre-tax gain, net of transaction and
other related costs, of $0.4 billion associated with the completed
sale of the Cybersecurity, Intelligence and Services (CIS) business
at Raytheon. Management has determined that the nature of the net
gain on the divestiture is considered significant and
non-operational and therefore, not indicative of the Company's
ongoing operational performance.
|
(3)
|
Total net significant
and/or non-recurring items in the table above for the quarter ended
March 31, 2024 includes a tax benefit of $0.3 billion recognized as
a result of the closure of the examination phase of multiple
federal tax audits during the quarter. In addition, there was a
pre-tax charge of $68 million for the write-off of certain tax
related indemnity receivables and a pre-tax gain on the reversal of
$78 million of interest accruals, both directly associated with
these tax audit settlements. Management has determined that the
nature of these impacts related to the tax audit settlements is
considered significant and non-operational and therefore, not
indicative of the Company's ongoing operational
performance.
|
RTX
Corporation
Reconciliation of
Adjusted (Non-GAAP) Results
Adjusted Income,
Earnings Per Share, and Effective Tax Rate
|
|
|
Quarter Ended
March 31,
|
|
(Unaudited)
|
(dollars in
millions - Income (Expense))
|
2024
|
|
2023
|
Net income
attributable to common shareowners
|
$
1,709
|
|
$
1,426
|
Total
Restructuring
|
(34)
|
|
(30)
|
Total Acquisition
accounting adjustments
|
(500)
|
|
(493)
|
Total net significant
and/or non-recurring items included in Operating profit
(1)(2)(3)
|
112
|
|
57
|
Significant and/or
non-recurring items included in Non-service Pension
Income
|
|
|
|
Non-service pension
restructuring
|
(2)
|
|
(2)
|
Pension curtailment
related to sale of business(2)
|
9
|
|
—
|
Significant
non-recurring and non-operational items included in Interest
Expense, Net
|
|
|
|
Tax audit
settlements(3)
|
78
|
|
—
|
Tax effect of
restructuring and net significant and/or non-recurring items
above
|
(41)
|
|
101
|
Significant and/or
non-recurring items included in Income Tax Expense
|
|
|
|
Tax audit
settlements(3)
|
296
|
|
—
|
Less: Impact on net
income attributable to common shareowners
|
(82)
|
|
(367)
|
Adjusted net income
attributable to common shareowners
|
$
1,791
|
|
$
1,793
|
|
|
|
|
Diluted Earnings Per
Share
|
$
1.28
|
|
$
0.97
|
Impact on Diluted
Earnings Per Share
|
(0.06)
|
|
(0.25)
|
Adjusted Diluted
Earnings Per Share
|
$
1.34
|
|
$
1.22
|
|
|
|
|
Effective Tax
Rate
|
5.8 %
|
|
18.4 %
|
Impact on Effective
Tax Rate
|
(10.8) %
|
|
(0.7) %
|
Adjusted Effective
Tax Rate
|
16.6 %
|
|
19.1 %
|
(1)
|
Total net significant
and/or non-recurring items in the table above for the quarter ended
March 31, 2024 includes a net pre-tax charge of $0.2 billion
related to the recognition of unfavorable purchase commitments and
an impairment of contract fulfillment costs associated with
initiating alternative titanium sources at Collins. These charges
were recorded as a result of the Canadian government's imposition
of new sanctions in February 2024, which included U.S.- and
German-based Russian-owned entities from which we source titanium
for use in our Canadian operations. Management has determined that
these impacts are directly attributable to the sanctions,
incremental to similar costs incurred for reasons other than those
related to the sanctions and has determined that the nature of the
charge is considered significant and unusual, and therefore, not
indicative of the Company's ongoing operational
performance.
|
(2)
|
Total net significant
and/or non-recurring items in the table above for the quarter ended
March 31, 2024 includes a pre-tax gain, net of transaction and
other related costs, of $0.4 billion associated with the completed
sale of the CIS business at Raytheon. Management has
determined that the nature of the net gain on the divestiture is
considered significant and non-operational and therefore, not
indicative of the Company's ongoing operational
performance.
|
(3)
|
Total net significant
and/or non-recurring items in the table above for the quarter ended
March 31, 2024 includes a tax benefit of $0.3 billion recognized as
a result of the closure of the examination phase of multiple
federal tax audits during the quarter. In addition, there was a
pre-tax charge of $68 million for the write-off of certain tax
related indemnity receivables and a pre-tax gain on the reversal of
$78 million of interest accruals, both directly associated with
these tax audit settlements. Management has determined that the
nature of these impacts related to the tax audit settlements is
considered significant and non-operational and therefore, not
indicative of the Company's ongoing operational
performance.
|
RTX
Corporation
Reconciliation of
Adjusted (Non-GAAP) Results
Segment Operating
Profit Margin and Adjusted Segment Operating Profit
Margin
|
|
|
Quarter Ended
March 31,
|
|
(Unaudited)
|
(dollars in
millions - Income (Expense))
|
2024
|
|
2023
|
Net
Sales
|
$
19,305
|
|
$
17,214
|
Reconciliation to
segment net sales:
|
|
|
|
Eliminations and
other
|
483
|
|
428
|
Segment Net
Sales
|
$
19,788
|
|
$
17,642
|
|
|
|
|
Operating
Profit
|
$ 1,870
|
|
$ 1,687
|
Operating Profit
Margin
|
9.7 %
|
|
9.8 %
|
Reconciliation to
segment operating profit:
|
|
|
|
Eliminations
and other
|
5
|
|
(51)
|
Corporate
expenses and other unallocated items
|
96
|
|
43
|
FAS/CAS
operating adjustment
|
(214)
|
|
(289)
|
Acquisition
accounting adjustments
|
500
|
|
493
|
Segment Operating
Profit
|
$ 2,257
|
|
$ 1,883
|
Segment Operating
Profit Margin
|
11.4 %
|
|
10.7 %
|
Reconciliation to
adjusted segment operating profit:
|
|
|
|
Restructuring
|
(33)
|
|
(29)
|
Net significant
and/or non-recurring items (1)(2)(3)
|
182
|
|
(9)
|
Adjusted Segment
Operating Profit
|
$ 2,108
|
|
$ 1,921
|
Adjusted Segment
Operating Profit Margin
|
10.7 %
|
|
10.9 %
|
(1)
|
Net significant and/or
non-recurring items in the table above for the quarter ended March
31, 2024 includes a net pre-tax charge of $0.2 billion related to
the recognition of unfavorable purchase commitments and an
impairment of contract fulfillment costs associated with initiating
alternative titanium sources at Collins. These charges were
recorded as a result of the Canadian government's imposition of new
sanctions in February 2024, which included U.S.- and
German-based Russian-owned entities from which we source titanium
for use in our Canadian operations. Management has determined that
these impacts are directly attributable to the sanctions,
incremental to similar costs incurred for reasons other than those
related to the sanctions and has determined that the nature of the
charge is considered significant and unusual, and therefore, not
indicative of the Company's ongoing operational
performance.
|
(2)
|
Net significant and/or
non-recurring items in the table above for the quarter ended March
31, 2024 includes a pre-tax gain, net of transaction and other
related costs, of $0.4 billion associated with the completed sale
of the CIS business at Raytheon. Management has determined
that the nature of the net gain on the divestiture is considered
significant and non-operational and therefore, not indicative of
the Company's ongoing operational performance.
|
(3)
|
Net significant and/or
non-recurring items in the table above for the quarter ended March
31, 2024 includes a tax benefit of $0.3 billion recognized as a
result of the closure of the examination phase of multiple federal
tax audits during the quarter. In addition, there was a pre-tax
charge of $68 million for the write-off of certain tax related
indemnity receivables and a pre-tax gain on the reversal of $78
million of interest accruals, both directly associated with these
tax audit settlements. Management has determined that the nature of
these impacts related to the tax audit settlements is considered
significant and non-operational and therefore, not indicative of
the Company's ongoing operational performance.
|
RTX
Corporation
Free Cash Flow
Reconciliation
|
|
|
Quarter Ended
March 31,
|
|
(Unaudited)
|
(dollars in
millions)
|
2024
|
|
2023
|
Net cash flows provided
by (used in) operating activities
|
$
342
|
|
$
(863)
|
Capital
expenditures
|
(467)
|
|
(520)
|
Free cash
flow
|
$
(125)
|
|
$
(1,383)
|
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content:https://www.prnewswire.com/news-releases/rtx-reports-q1-2024-results-302123821.html
SOURCE RTX