2016 Q2 Form 10-Q Financial Statement

#000001292716000143 Filed on July 27, 2016

View on sec.gov

Income Statement

Concept 2016 Q2 2015 Q2
Revenue $24.76B $24.54B
YoY Change 0.86% 11.33%
Cost Of Revenue $22.33B $21.35B
YoY Change 4.57% 14.35%
Gross Profit $2.430B $3.193B
YoY Change -23.9% -5.39%
Gross Profit Margin 9.82% 13.01%
Selling, General & Admin $806.0M $760.0M
YoY Change 6.05% -17.21%
% of Gross Profit 33.17% 23.8%
Research & Development $2.127B $800.0M
YoY Change 165.88% 9.14%
% of Gross Profit 87.53% 25.05%
Depreciation & Amortization $447.0M $453.0M
YoY Change -1.32% 0.22%
% of Gross Profit 18.4% 14.19%
Operating Expenses $2.127B $800.0M
YoY Change 165.88% 9.14%
Operating Profit -$419.0M $1.683B
YoY Change -124.9% -5.82%
Interest Expense $24.00M -$25.00M
YoY Change -196.0% 25.0%
% of Operating Profit -1.49%
Other Income/Expense, Net $13.00M $15.00M
YoY Change -13.33% 36.36%
Pretax Income -$479.0M $1.623B
YoY Change -129.51% -5.47%
Income Tax -$245.0M $513.0M
% Of Pretax Income 31.61%
Net Earnings -$234.0M $1.110B
YoY Change -121.08% -32.85%
Net Earnings / Revenue -0.95% 4.52%
Basic Earnings Per Share -$0.37 $1.61
Diluted Earnings Per Share -$0.37 $1.59
COMMON SHARES
Basic Shares Outstanding 635.3M shares 690.1M shares
Diluted Shares Outstanding 635.3M shares 697.8M shares

Balance Sheet

Concept 2016 Q2 2015 Q2
SHORT-TERM ASSETS
Cash & Short-Term Investments $9.265B $9.625B
YoY Change -3.74% -15.05%
Cash & Equivalents $8.605B $9.157B
Short-Term Investments $660.0M $468.0M
Other Short-Term Assets $17.00M
YoY Change 13.33%
Inventory $44.18B $49.03B
Prepaid Expenses
Receivables $9.809B $7.927B
Other Receivables $251.0M $209.0M
Total Short-Term Assets $63.51B $66.81B
YoY Change -4.94% 1.95%
LONG-TERM ASSETS
Property, Plant & Equipment $12.53B $11.34B
YoY Change 10.54% 8.51%
Goodwill $5.128B $5.126B
YoY Change 0.04% -0.25%
Intangibles $2.544B $2.763B
YoY Change -7.93% -8.02%
Long-Term Investments $1.230B $1.208B
YoY Change 1.82% 4.95%
Other Assets $1.409B $1.374B
YoY Change 2.55% -12.93%
Total Long-Term Assets $26.10B $31.30B
YoY Change -16.6% 15.02%
TOTAL ASSETS
Total Short-Term Assets $63.51B $66.81B
Total Long-Term Assets $26.10B $31.30B
Total Assets $89.61B $98.10B
YoY Change -8.66% 5.79%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $11.75B $11.53B
YoY Change 1.88% 4.26%
Accrued Expenses $13.53B $13.23B
YoY Change 2.33% 0.03%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00
YoY Change
Long-Term Debt Due $1.168B $112.0M
YoY Change 942.86% -92.96%
Total Short-Term Liabilities $49.86B $57.14B
YoY Change -12.74% 7.12%
LONG-TERM LIABILITIES
Long-Term Debt $9.847B $8.904B
YoY Change 10.59% 22.11%
Other Long-Term Liabilities $2.048B $1.052B
YoY Change 94.68% 21.76%
Total Long-Term Liabilities $2.048B $1.052B
YoY Change 94.68% 21.76%
TOTAL LIABILITIES
Total Short-Term Liabilities $49.86B $57.14B
Total Long-Term Liabilities $2.048B $1.052B
Total Liabilities $51.91B $58.19B
YoY Change -10.79% 7.35%
SHAREHOLDERS EQUITY
Retained Earnings $38.36B $37.37B
YoY Change 2.67% 8.25%
Common Stock $5.061B $5.061B
YoY Change 0.0% 0.0%
Preferred Stock
YoY Change
Treasury Stock (at cost) $34.82B $27.46B
YoY Change 26.79% 28.45%
Treasury Stock Shares 386.4M shares 331.2M shares
Shareholders Equity $585.0M $6.264B
YoY Change
Total Liabilities & Shareholders Equity $89.61B $98.10B
YoY Change -8.66% 5.79%

Cashflow Statement

Concept 2016 Q2 2015 Q2
OPERATING ACTIVITIES
Net Income -$234.0M $1.110B
YoY Change -121.08% -32.85%
Depreciation, Depletion And Amortization $447.0M $453.0M
YoY Change -1.32% 0.22%
Cash From Operating Activities $3.190B $3.297B
YoY Change -3.25% 82.26%
INVESTING ACTIVITIES
Capital Expenditures -$671.0M -$692.0M
YoY Change -3.03% 54.12%
Acquisitions
YoY Change
Other Investing Activities -$241.0M $494.0M
YoY Change -148.79% -62.69%
Cash From Investing Activities -$912.0M -$198.0M
YoY Change 360.61% -122.63%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -1.544B -2.605B
YoY Change -40.73% 24.28%
NET CHANGE
Cash From Operating Activities 3.190B 3.297B
Cash From Investing Activities -912.0M -198.0M
Cash From Financing Activities -1.544B -2.605B
Net Change In Cash 734.0M 494.0M
YoY Change 48.58% -15.99%
FREE CASH FLOW
Cash From Operating Activities $3.190B $3.297B
Capital Expenditures -$671.0M -$692.0M
Free Cash Flow $3.861B $3.989B
YoY Change -3.21% 76.66%

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us-gaap Excess Tax Benefit From Share Based Compensation Financing Activities
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us-gaap Gross Profit
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us-gaap Gross Profit
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us-gaap Income Loss From Continuing Operations Before Income Taxes Extraordinary Items Noncontrolling Interest
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us-gaap Income Loss From Continuing Operations Before Income Taxes Extraordinary Items Noncontrolling Interest
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us-gaap Other Comprehensive Income Loss Available For Sale Securities Adjustment Net Of Tax
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us-gaap Other Comprehensive Income Loss Available For Sale Securities Adjustment Net Of Tax
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us-gaap Other Comprehensive Income Loss Net Of Tax Portion Attributable To Parent
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us-gaap Weighted Average Number Of Shares Outstanding Basic
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us-gaap Financing Receivable Allowance For Credit Losses Policy For Uncollectible Amounts
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<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-bottom:12px;text-align:justify;font-size:10pt;"><font style="font-family:Arial;font-size:10pt;">The adequacy of the allowance for losses is assessed quarterly. Three primary factors influencing the level of our allowance for losses on customer financing receivables are customer credit ratings, default rates and collateral values. We assign internal credit ratings for all customers and determine the creditworthiness of each customer based upon publicly available information and information obtained directly from our customers. Our rating categories are comparable to those used by the major credit rating agencies.</font></div></div>
us-gaap Use Of Estimates
UseOfEstimates
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-bottom:12px;text-align:justify;font-size:10pt;"><font style="font-family:Arial;font-size:10pt;">Management makes assumptions and estimates to prepare financial statements in conformity with accounting principles generally accepted in the United States of America. Those assumptions and estimates directly affect the amounts reported in the Condensed Consolidated Financial Statements. Significant estimates for which changes in the near term are considered reasonably possible and that may have a material impact on the financial statements are disclosed in these Notes to the Condensed Consolidated Financial Statements.</font></div><div style="line-height:120%;padding-bottom:20px;text-align:justify;font-size:10pt;"><font style="font-family:Arial;font-size:10pt;">Contract accounting is used for development and production activities predominantly by </font><font style="font-family:Arial;font-size:10pt;">Defense, Space &amp; Security</font><font style="font-family:Arial;font-size:10pt;"> (</font><font style="font-family:Arial;font-size:10pt;">BDS</font><font style="font-family:Arial;font-size:10pt;">). Contract accounting involves a judgmental process of estimating total sales and costs for each contract resulting in the development of estimated cost of sales percentages. Changes in estimated revenues, cost of sales and the related effect on operating income are recognized using a cumulative catch-up adjustment which recognizes in the current period the cumulative effect of the changes on current and prior periods based on a contract&#8217;s percent complete. For the </font><font style="font-family:Arial;font-size:10pt;">six months ended June 30, 2016 and 2015</font><font style="font-family:Arial;font-size:10pt;">, net unfavorable cumulative catch-up adjustments, including reach-forward losses, across all contracts decreased Earnings from operations by </font><font style="font-family:Arial;font-size:10pt;">$587</font><font style="font-family:Arial;font-size:10pt;"> and </font><font style="font-family:Arial;font-size:10pt;">$594</font><font style="font-family:Arial;font-size:10pt;"> and diluted earnings per share by </font><font style="font-family:Arial;font-size:10pt;">$0.70</font><font style="font-family:Arial;font-size:10pt;"> and </font><font style="font-family:Arial;font-size:10pt;">$0.58</font><font style="font-family:Arial;font-size:10pt;">. For the </font><font style="font-family:Arial;font-size:10pt;">three months ended June 30, 2016 and 2015</font><font style="font-family:Arial;font-size:10pt;">, net unfavorable cumulative catch-up adjustments, including reach-forward losses, across all contracts decreased Earnings from operations by </font><font style="font-family:Arial;font-size:10pt;">$503</font><font style="font-family:Arial;font-size:10pt;"> and </font><font style="font-family:Arial;font-size:10pt;">$724</font><font style="font-family:Arial;font-size:10pt;"> and diluted earnings per share by </font><font style="font-family:Arial;font-size:10pt;">$0.39</font><font style="font-family:Arial;font-size:10pt;"> and </font><font style="font-family:Arial;font-size:10pt;">$0.71</font><font style="font-family:Arial;font-size:10pt;">. </font></div></div>

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