2018 Q4 Form 10-Q Financial Statement

#000150630718000079 Filed on October 19, 2018

View on sec.gov

Income Statement

Concept 2018 Q4 2018 Q3 2017 Q3
Revenue $3.781B $3.517B $3.281B
YoY Change 4.1% 7.19% -1.47%
Cost Of Revenue $1.839B $1.135B $1.007B
YoY Change -7.17% 12.71% 3.71%
Gross Profit $1.942B $2.382B $2.274B
YoY Change 17.63% 4.75% -3.6%
Gross Profit Margin 51.36% 67.73% 69.31%
Selling, General & Admin $196.0M $240.0M $270.0M
YoY Change -30.0% -11.11% -2.53%
% of Gross Profit 10.09% 10.08% 11.87%
Research & Development
YoY Change
% of Gross Profit
Depreciation & Amortization $587.0M $569.0M $562.0M
YoY Change 4.08% 1.25% 2.37%
% of Gross Profit 30.23% 23.89% 24.71%
Operating Expenses $782.0M $809.0M $832.0M
YoY Change -7.24% -2.76% 0.85%
Operating Profit $1.160B $1.515B $826.0M
YoY Change 43.56% 83.41% -6.35%
Interest Expense -$282.0M -$313.0M -$292.0M
YoY Change -18.02% 7.19% -12.84%
% of Operating Profit -24.31% -20.66% -35.35%
Other Income/Expense, Net -$1.000M -$314.0M -$279.0M
YoY Change -110.0% 12.54% -59.45%
Pretax Income $775.0M $1.201B $547.0M
YoY Change 139.2% 119.56% 181.96%
Income Tax $273.0M $196.0M $160.0M
% Of Pretax Income 35.23% 16.32% 29.25%
Net Earnings $494.0M $732.0M $373.0M
YoY Change -149.11% 96.25% -298.4%
Net Earnings / Revenue 13.07% 20.81% 11.37%
Basic Earnings Per Share $0.31 $0.15
Diluted Earnings Per Share $219.7K $332.0K $0.15
COMMON SHARES
Basic Shares Outstanding 2.207B shares 2.205B shares 2.231B shares
Diluted Shares Outstanding 2.231B shares

Balance Sheet

Concept 2018 Q4 2018 Q3 2017 Q3
SHORT-TERM ASSETS
Cash & Short-Term Investments $3.280B $3.459B $539.0M
YoY Change 1142.42% 541.74% 50.98%
Cash & Equivalents $3.280B $3.459B $539.0M
Short-Term Investments
Other Short-Term Assets $248.0M $227.0M $176.0M
YoY Change 4.2% 28.98% -23.48%
Inventory $385.0M $383.0M $428.0M
Prepaid Expenses
Receivables $1.498B $1.384B $1.194B
Other Receivables $23.00M $161.0M $20.00M
Total Short-Term Assets $5.722B $5.766B $2.613B
YoY Change 110.76% 120.67% -22.3%
LONG-TERM ASSETS
Property, Plant & Equipment $37.90B $37.80B $39.87B
YoY Change -5.62% -5.2% 2.8%
Goodwill $21.97B $21.97B $22.16B
YoY Change -0.89% -0.9% 0.0%
Intangibles $2.880B $2.935B $3.153B
YoY Change -7.07% -6.91% -6.83%
Long-Term Investments $7.481B $7.432B $7.484B
YoY Change 2.51% -0.69% 1.71%
Other Assets $1.355B $1.296B $1.638B
YoY Change -14.35% -20.88% -16.47%
Total Long-Term Assets $73.14B $73.30B $77.74B
YoY Change -4.19% -5.71% -0.64%
TOTAL ASSETS
Total Short-Term Assets $5.722B $5.766B $2.613B
Total Long-Term Assets $73.14B $73.30B $77.74B
Total Assets $78.87B $79.06B $80.35B
YoY Change -0.24% -1.6% -1.54%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $1.337B $1.307B $1.358B
YoY Change -0.22% -3.76% 13.93%
Accrued Expenses $876.0M $488.0M $719.0M
YoY Change -32.13% -21.68%
Deferred Revenue $80.00M $79.00M
YoY Change 1.27%
Short-Term Debt $0.00 $0.00 $0.00
YoY Change
Long-Term Debt Due $3.388B $2.337B $3.156B
YoY Change 19.8% -25.95% 7.2%
Total Short-Term Liabilities $7.557B $5.489B $6.174B
YoY Change 22.26% -11.09% 2.15%
LONG-TERM LIABILITIES
Long-Term Debt $33.94B $35.27B $35.12B
YoY Change -3.08% 0.43% -8.83%
Other Long-Term Liabilities $2.176B $2.407B $2.537B
YoY Change -20.44% -5.12% 22.32%
Total Long-Term Liabilities $36.11B $37.68B $37.65B
YoY Change -4.34% 0.06% -7.24%
TOTAL LIABILITIES
Total Short-Term Liabilities $7.557B $5.489B $6.174B
Total Long-Term Liabilities $36.11B $37.68B $37.65B
Total Liabilities $43.67B $43.16B $43.83B
YoY Change -0.6% -1.51% -6.02%
SHAREHOLDERS EQUITY
Retained Earnings -$7.716B -$7.744B -$6.429B
YoY Change -0.49% 20.45% -2.0%
Common Stock $23.00M $22.00M $22.00M
YoY Change 4.55% 0.0% 0.0%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $33.68B $33.49B $35.23B
YoY Change
Total Liabilities & Shareholders Equity $78.87B $79.06B $80.35B
YoY Change -0.24% -1.6% -1.54%

Cashflow Statement

Concept 2018 Q4 2018 Q3 2017 Q3
OPERATING ACTIVITIES
Net Income $494.0M $732.0M $373.0M
YoY Change -149.11% 96.25% -298.4%
Depreciation, Depletion And Amortization $587.0M $569.0M $562.0M
YoY Change 4.08% 1.25% 2.37%
Cash From Operating Activities $1.668B $907.0M $1.141B
YoY Change 28.9% -20.51% -1.55%
INVESTING ACTIVITIES
Capital Expenditures -$714.0M -$737.0M -$895.0M
YoY Change -25.39% -17.65% 40.06%
Acquisitions
YoY Change
Other Investing Activities -$40.00M $2.855B -$40.00M
YoY Change -164.52% -7237.5% -102.72%
Cash From Investing Activities -$754.0M $2.118B -$935.0M
YoY Change -15.75% -326.52% -212.24%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -971.0M 157.0M -159.0M
YoY Change 41.34% -198.74% -91.23%
NET CHANGE
Cash From Operating Activities 1.668B 907.0M 1.141B
Cash From Investing Activities -754.0M 2.118B -935.0M
Cash From Financing Activities -971.0M 157.0M -159.0M
Net Change In Cash -57.00M 3.182B 47.00M
YoY Change -80.21% 6670.21% -73.6%
FREE CASH FLOW
Cash From Operating Activities $1.668B $907.0M $1.141B
Capital Expenditures -$714.0M -$737.0M -$895.0M
Free Cash Flow $2.382B $1.644B $2.036B
YoY Change 5.82% -19.25% 13.24%

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<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Recent Accounting Pronouncements</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Topic 842</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On February 25, 2016, the FASB issued ASU No. 2016-02, &#8220;</font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Leases (Topic 842)</font><font style="font-family:inherit;font-size:10pt;">.&#8221; This ASU establishes a comprehensive new lease accounting model, which requires substantially all leases, with the exception for leases with a term of one year or less, to be recorded on the balance sheet as a lease liability measured as the present value of the future lease payments with a corresponding right-of-use asset. The ASU also requires disclosures designed to give financial statement users information on the amount, timing, and uncertainty of cash flows arising from leases.</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On January 25, 2018, the FASB issued ASU No. 2018-01, &#8220;</font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Land Easement Practical Expedient for Transition to Topic 842</font><font style="font-family:inherit;font-size:10pt;">.&#8221; This ASU permits an entity to elect a transition practical expedient to not apply the provisions of ASU No. 2016-02 to land easements that existed or expired before the effective date of ASU No. 2016-02 and that were not previously accounted for as leases under the previous lease guidance in ASC Topic 840 &#8220;</font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Leases</font><font style="font-family:inherit;font-size:10pt;">.&#8221;</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On July 30, 2018, the FASB issued ASU No. 2018-11, &#8220;</font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Leases (Topic 842): Targeted Improvements</font><font style="font-family:inherit;font-size:10pt;">.&#8221; This ASU permits an entity to elect an additional transition method to the existing modified retrospective transition requirements. Under the new transition method, an entity could adopt the provisions of ASU No. 2016-02 by recognizing a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption without adjustment to the financial statements for periods prior to adoption. Consequently, an entity&#8217;s reporting for the comparative periods presented in the financial statements in which it adopts the new leases standard will continue to be in accordance with the previous lease guidance in ASC Topic 840. ASU No. 2018-11 also allows a practical expedient that permits lessors to not separate non-lease components from the associated lease component if certain conditions are present.</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We are in the process of finalizing our review of our lease agreements in light of Topic 842 guidance, implementing a financial lease accounting system, evaluating internal control changes to support management in the accounting for and disclosure of leasing activities, and assessing available transition practical expedients. While we are still in the process of completing our implementation evaluation of ASU No. 2016-02, we currently believe the most significant changes to our financial statements relate to the recognition of a lease liability and offsetting right-of-use asset in our Consolidated Balance Sheet for operating leases. ASU No. 2016-02 will be effective for us as of January 1, 2019.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">ASU No. 2016-13</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On June 16, 2016, the FASB issued ASU No. 2016-13, &#8220;</font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments</font><font style="font-family:inherit;font-size:10pt;">.&#8221; This ASU modifies the impairment model to utilize an expected loss methodology in place of the currently used incurred loss methodology, which will result in the more timely recognition of losses. ASU No. 2016-13 will be effective for us as of January 1, 2020, and earlier adoption is permitted. We are currently reviewing the effect of this ASU to our financial statements.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">ASU No. 2017-04</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On January 26, 2017, the FASB issued ASU No. 2017-04, &#8220;</font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment.</font><font style="font-family:inherit;font-size:10pt;">&#8221; This ASU simplifies the accounting for goodwill impairment by removing Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. Goodwill impairment will now be the amount by which a reporting unit&#8217;s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. ASU No. 2017-04 will be effective for us as of January 1, 2020, and earlier adoption is permitted. We are currently reviewing the effect of this ASU to our financial statements.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">ASU No. 2017-12</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On August 28, 2017, the FASB issued ASU No. 2017-12, &#8220;</font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities</font><font style="font-family:inherit;font-size:10pt;">.&#8221; This ASU better aligns an entity&#8217;s risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The guidance expands the ability to hedge nonfinancial and financial risk components, reduces complexity in fair value hedges of interest rate risk, eliminates the requirement to separately measure and report hedge ineffectiveness, and eases certain hedge effectiveness assessment requirements. While we are still in the process of completing our implementation evaluation of ASU No. 2017-12, we currently believe the most significant changes to our financial statements relate to (i) the ability to hedge contractually specified components of the price of forecasted purchases and sales of nonfinancial assets and (ii) the elimination of the concept of recognizing periodic hedge ineffectiveness for cash flow hedges. ASU No. 2017-12 will be</font><font style="font-family:inherit;font-size:10pt;font-style:italic;"> </font><font style="font-family:inherit;font-size:10pt;">effective for us as of January 1, 2019 and will be applied using a modified retrospective approach for existing cash flow hedging relationships as of the adoption date and prospectively for the presentation and disclosure guidance.</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">ASU No. 2018-13</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On August 28, 2018, the FASB issued ASU No. 2018-13, &#8220;</font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement.&#8221; </font><font style="font-family:inherit;font-size:10pt;">This ASU amends existing fair value measurement disclosure requirements by adding, changing, or removing certain disclosures. ASU No. 2018-13 will be effective for us as of January 1, 2020, and earlier adoption is permitted. We are currently reviewing the effect of this ASU to our financial statements.</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">ASU No. 2018-14</font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On August 28, 2018, the FASB issued ASU No. 2018-14, &#8220;</font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20): Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans</font><font style="font-family:inherit;font-size:10pt;">.&#8221; This ASU amends existing annual disclosure requirements applicable to all employers that sponsor defined benefit pension and other postretirement plans by adding, removing, and clarifying certain disclosures. ASU No. 2018-14 will be effective for us for the fiscal year ending December 31, 2020, and earlier adoption is permitted. We are currently reviewing the effect of this ASU to our financial statements.</font></div></div>

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