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Raytheon Reports Strong First Quarter Results; Increases Full-Year Guidance

Highlights

- Net sales of $5.9 billion, up 10 percent

- Operating income of $712 million, up 17 percent

- Earnings per share (EPS) from continuing operations of $1.11, up 21 percent

- Solid bookings of $5.2 billion; backlog of $37.9 billion

- Increased annual dividend by 11 percent to $1.24 per share, as previously announced

WALTHAM, Mass., April 23, 2009 /PRNewswire-FirstCall/ -- Raytheon Company reported first quarter 2009 income from continuing operations of $457 million or $1.11 per diluted share compared to $401 million or $0.92 per diluted share in the first quarter 2008.

"We delivered strong results across all of our businesses during the quarter," said William H. Swanson, Raytheon's Chairman and CEO. "Raytheon's strong domestic and international business and diverse portfolio of more than 8,000 programs position us well today and for the future."

Net sales for the first quarter 2009 were $5.9 billion, up 10 percent from $5.4 billion in the first quarter 2008, with growth across all of the Company's businesses.

Operating cash flow from continuing operations for the first quarter 2009 was $411 million compared to $67 million for the first quarter 2008. The increase in operating cash flow was primarily due to a $337 million tax refund received in the first quarter 2009.

In the first quarter 2009 the Company repurchased 6.8 million shares of common stock for $300 million, as part of the Company's previously announced share repurchase program. In addition, as announced in March 2009, the Company's Board of Directors voted to increase the Company's annual dividend payout rate by 11 percent from $1.12 to $1.24 per share.

The Company ended the first quarter 2009 with $87 million of net debt. Net debt is defined as total debt less cash and cash equivalents.


    Summary Financial Results                      1st Quarter         %
    ($in millions, except per share data)        2009        2008   Change

    Net sales                                  $5,884      $5,354      10%
      Total operating expenses                  5,172       4,745
     Operating income                             712         609      17%
      Non-operating expenses,
       net                                         33          16
       Income from cont. ops. before taxes       $679        $593      15%
       Income from continuing operations         $457        $401      14%
       Income/(loss) from disc. ops., net                              NM
        of tax                                      3          (2)
     Net income(1)                               $460        $399      15%
            Less: noncontrolling
            interests(1)                            8           1
       Net income attributable to
        Raytheon Company(1)                      $452        $398      14%
       Diluted EPS from continuing
        operations(2)                           $1.11       $0.92      21%
       Diluted EPS(2)                           $1.12       $0.92      22%

       Operating cash flow from cont. ops.       $411         $67
       FAS/CAS pension adjustment
        Inc./(Exp.)                               $11        $(33)
       Workdays in fiscal reporting
        calendar                                   61          63

    (1) Raytheon Company adopted FAS No.160, Noncontrolling Interests in
        Consolidated Financial Statements, effective January 1, 2009.
    (2) Raytheon Company adopted FASB Staff Position EITF 03-6-1 for
        Participating Securities, effective January 1, 2009, which decreased
        Q1 2008 diluted EPS from continuing operations by $0.01.  The impact
        on Q1 2008 diluted EPS was less than $0.01.

The Company adopted FAS No.160, Noncontrolling Interests in Consolidated Financial Statements, effective January 1, 2009. The Company's noncontrolling interests relate primarily to Thales-Raytheon Systems Co. LLC, which is included in the Network Centric Systems (NCS) segment. The impact to NCS in the first quarter 2009 is an increase of $8 million in operating income compared to an increase of $1 million in the first quarter 2008.

During the quarter, the Company changed the reporting of a U.K. manufacturing facility from Space and Airborne Systems to Missile Systems. Prior period segment results have been revised to reflect this reorganization.

Bookings and Backlog


     Bookings                              1st Quarter
     ($in millions)                      2009        2008

     Total Bookings                     $5,209      $6,516

     Backlog
                                          Period Ended
     ($in millions)                   03/29/09    12/31/08

    Backlog                            $37,939     $38,884
     Funded Backlog                    $23,022     $21,986

The Company reported total bookings for the first quarter 2009 of $5.2 billion compared to $6.5 billion in the first quarter 2008. The Company ended the first quarter 2009 with a backlog of $37.9 billion compared to $38.9 billion at the end of 2008 and $37.7 billion at the end of the first quarter 2008.

Outlook


    2009 Financial Outlook               Current      Prior (1/29/09)

    Net Sales ($B)                      24.4 - 24.9*   24.3 - 24.8
    FAS/CAS Pension Income ($M)             47             47
    Interest Inc./(Exp.), net ($M)     (105) - (115)  (105) - (115)
    Diluted Shares (M)                   398 - 401*     402 - 405
    EPS from Continuing Operations     $4.55 - $4.70* $4.45 - $4.60
    Operating Cash Flow from
     Cont. Ops. ($B)                     2.2 - 2.4      2.2 - 2.4
    ROIC (%)                            11.1 - 11.6*   11.0 - 11.5**

    *  Denotes change from prior guidance.
    ** Prior ROIC guidance now reflects a 10 bp increase due to the
       impact of FAS 160, Noncontrolling Interests in Consolidated
       Financial Statements, which the Company adopted January 1,
       2009.  The Company's noncontrolling interests relate primarily
       to Thales-Raytheon Systems Co. LLC at NCS.

The Company has increased full-year 2009 guidance for net sales, earnings per share from continuing operations and Return on Invested Capital (ROIC), and updated the outlook for diluted share count. Charts containing additional information on the Company's 2009 guidance are available on the Company's website at www.raytheon.com. See attachment F for the Company's calculation and use of ROIC, a non-GAAP financial measure.

Segment Results

Integrated Defense Systems

                                          1st Quarter         %
                                                            Change
    ($in millions)                      2009      2008

    Net Sales                         $1,262    $1,192         6%
    Operating Income                    $188      $211       -11%
    Operating Margin                   14.9%     17.7%

Integrated Defense Systems (IDS) had first quarter 2009 net sales of $1,262 million, up 6 percent compared to $1,192 million in the first quarter 2008, primarily due to growth on domestic and international Patriot programs. IDS recorded $188 million of operating income compared to $211 million in the first quarter 2008. The change in operating income was primarily due to contract mix, driven primarily by the completion of certain programs in 2008. IDS also benefited from the sale of certain software licenses in the first quarter 2008.

During the quarter, IDS booked $741 million in new international and domestic Patriot awards, including $185 million for the United Arab Emirates (UAE), $139 million for Taiwan, $159 million to provide engineering services and $115 million for the Patriot Pure Fleet program for the U.S. Army.

Intelligence and Information Systems

                                          1st Quarter          %
                                                            Change
    ($in millions)                      2009      2008

    Net Sales                           $784      $692        13%
    Operating Income                     $61       $52        17%
    Operating Margin                    7.8%      7.5%

Intelligence and Information Systems (IIS) had first quarter 2009 net sales of $784 million, up 13 percent compared to $692 million in the first quarter 2008, primarily due to higher volume on classified contracts. IIS recorded $61 million of operating income compared to $52 million in the first quarter 2008. The increase in operating income was primarily due to higher volume.

During the quarter, IIS booked $236 million on a number of classified contracts.

Missile Systems

                                         1st Quarter          %
                                                            Change
    ($in millions)                     2009      2008

    Net Sales                         $1,368    $1,319         4%
    Operating Income                    $158      $139        14%
    Operating Margin                   11.5%     10.5%

Missile Systems (MS) had first quarter 2009 net sales of $1,368 million, up 4 percent compared to $1,319 million in the first quarter 2008, primarily due to higher volume on the Standard Missile, Advanced Medium-Range Air-to-Air Missile (AMRAAM), and Evolved Sea Sparrow Missile (ESSM) programs. MS recorded $158 million of operating income compared to $139 million in the first quarter 2008. The increase in operating income was due to improved program performance and higher volume.

During the quarter, MS booked $119 million for continued development and production work on the Exoatmospheric Kill Vehicle (EKV). MS also booked $85 million for the production of the Joint Standoff Weapon (JSOW) for the U.S. Navy.

Network Centric Systems

                                          1st Quarter          %
                                                            Change
    ($in millions)                    2009      2008

    Net Sales                         $1,154    $1,067         8%
    Operating  Income                   $163      $124        31%
    Operating Margin                   14.1%     11.6%


Network Centric Systems (NCS) had first quarter 2009 net sales of $1,154 million, up 8 percent compared to $1,067 million in the first quarter 2008, primarily due to increased volume on certain U.S. Army programs. NCS recorded $163 million of operating income compared to $124 million in the first quarter 2008. The increase in operating income was primarily due to improved program performance and higher volume.

During the quarter, NCS booked $98 million for the Secure Mobile Anti-Jam Reliable Tactical Terminal (SMART-T) program and $95 million for the Thermal Weapon Sight II program for the U.S. Army.

Space and Airborne Systems

                                          1st Quarter           %
                                                             Change
    ($in millions)                      2009      2008

    Net Sales                         $1,046      $977         7%
    Operating Income                    $139      $117        19%
    Operating Margin                   13.3%     12.0%

Space and Airborne Systems (SAS) had first quarter 2009 net sales of $1,046 million, up 7 percent compared to $977 million in the first quarter 2008, primarily due to growth on an international tactical radar program and classified business. SAS recorded $139 million of operating income compared to $117 million in the first quarter 2008. The increase in operating income was primarily due to higher volume, improved program performance and favorable contractual settlements.

During the quarter, SAS booked $422 million to supply APG-63 fire control radars and support equipment for the Japan Air Self-Defense Force. SAS also booked $130 million for the B-2 Radar Modernization Program (RMP).

Technical Services

                                          1st Quarter          %
                                                             Change
    ($in millions)                     2009      2008

    Net Sales                           $696      $521        34%
    Operating Income                     $44       $35        26%
    Operating Margin                    6.3%      6.7%

Technical Services (TS) had first quarter 2009 net sales of $696 million, up 34 percent compared to $521 million in the first quarter 2008, primarily due to strong growth in training programs. TS recorded operating income of $44 million in the first quarter 2009 compared to $35 million in the first quarter 2008. The increase in operating income was primarily due to higher volume.

During the quarter, TS booked $178 million for work on the Warfighter Field Operations Customer Support (FOCUS) contract for the U.S. Army.

Raytheon Company , with 2008 sales of $23.2 billion, is a technology and innovation leader specializing in defense, homeland security and other government markets throughout the world. With a history of innovation spanning 87 years, Raytheon provides state-of-the-art electronics, mission systems integration and other capabilities in the areas of sensing; effects; and command, control, communications and intelligence systems, as well as a broad range of mission support services. With headquarters in Waltham, Mass., Raytheon employs 73,000 people worldwide.

Conference Call on the First Quarter 2009 Financial Results

Raytheon's financial results conference call will be held on Thursday, April 23, 2009 at 9 a.m. EDT. Participants will include William H. Swanson, Chairman and CEO, David C. Wajsgras, senior vice president and CFO, and other Company executives.

The dial-in number for the conference call will be (800) 798-2864 in the U.S. or (617) 614-6206 outside of the U.S. The conference call will also be audiocast on the Internet at www.raytheon.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.

Interested parties are encouraged to check the website ahead of time to ensure their computers are configured for the audio stream. Instructions for obtaining the free required downloadable software are posted on the site.

Disclosure Regarding Forward-looking Statements

This release and the attachments contain forward-looking statements, including information regarding the Company's 2009 financial outlook, future plans, objectives, business prospects and anticipated financial performance. These forward-looking statements are not statements of historical facts and represent only the Company's current expectations regarding such matters. These statements inherently involve a wide range of known and unknown risks and uncertainties. The Company's actual actions and results could differ materially from what is expressed or implied by these statements. Specific factors that could cause such a difference include, but are not limited to: the Company's dependence on the U.S. Government for a significant portion of its business and the risks associated with U.S. Government sales, including changes or shifts in defense spending, uncertain funding of programs, potential termination of contracts, and difficulties in contract performance; the ability to procure new contracts; the risks of conducting business in foreign countries; the ability to comply with extensive governmental regulation, including import and export policies and procurement and other regulations; the impact of competition; the ability to develop products and technologies; the impact of the current downturn in the financial markets; the risk that actual pension returns are significantly different than the Company's assumptions; the risk of cost overruns, particularly for the Company's fixed-price contracts; dependence on component availability, subcontractor performance and key suppliers; risks of a negative government audit; the use of accounting estimates in the Company's financial statements; risks associated with acquisitions, dispositions, joint ventures and other business arrangements; risks of an impairment of goodwill or other intangible assets; the outcome of contingencies and litigation matters, including government investigations; the ability to recruit and retain qualified personnel; the impact of potential security threats and other disruptions; and other factors as may be detailed from time to time in the Company's public announcements and Securities and Exchange Commission filings. The Company undertakes no obligation to make any revisions to the forward-looking statements contained in this release and the attachments or to update them to reflect events or circumstances occurring after the date of this release, including any acquisitions, dispositions or other business arrangements that may be announced or closed after such date. This release and the attachments also contain non-GAAP financial measures. A GAAP reconciliation and a discussion of the Company's use of these measures are included in this release or the attachments.

    Media Contact:            Investor Relations Contact:
    Jon Kasle                 Marc Kaplan
    781-522-5110              781-522-5141

    Attachment A
    Raytheon Company
    Preliminary Statement of Operations Information*
    First Quarter 2009

    (In millions, except per share amounts)          Three Months Ended
                                                     ------------------
                                                    29-Mar-09  30-Mar-08
                                                    ---------  ---------

    Net sales                                          $5,884     $5,354
                                                       ------     ------
    Operating expenses
      Cost of sales                                     4,697      4,258
      Administrative and selling expenses                 364        380
      Research and development expenses                   111        107
                                                          ---        ---

    Total operating expenses                            5,172      4,745
                                                        -----      -----

    Operating income                                      712        609
                                                          ---        ---

      Interest expense                                     32         34
      Interest income                                      (4)       (23)
      Other expense, net                                    5          5
                                                            -          -

    Non-operating expense, net                             33         16
                                                           --         --

    Income from continuing operations before taxes        679        593

    Federal and foreign income taxes                      222        192
                                                          ---        ---

    Income from continuing operations                     457        401

    Income (loss) from discontinued operations,
     net of tax                                             3         (2)
                                                            -         --

    Net income                                            460        399
                                                          ---        ---

      Less: Net income attributable to
       noncontrolling interests                             8          1
                                                            -          -

    Net income attributable to Raytheon Company          $452       $398
                                                         ====       ====

    Basic earnings (loss) per share attributable
     to Raytheon Company common stockholders:
      Income from continuing operations                 $1.12      $0.94
      Discontinued operations                            0.01      (0.01)
      Net income                                         1.13       0.94

    Diluted earnings (loss) per share attributable
     to Raytheon Company common stockholders:
      Income from continuing operations                 $1.11      $0.92
      Discontinued operations                            0.01      (0.01)
      Net income                                         1.12       0.92

    Amounts attributable to Raytheon Company
     common stockholders:
      Income from continuing operations                  $449       $400
      Income (loss) from discontinued operations            3         (2)
                                                            -         --
      Net income                                         $452       $398
                                                         ====       ====

    Average shares outstanding
        Basic                                           399.0      423.8
        Diluted                                         404.0      434.7

    * This Preliminary Statement of Operations Information was prepared on
      the same basis as our annual consolidated financial statements, except
      for the adoption of Statement of Financial Accounting Standards No.
      160, Noncontrolling Interests, and Financial Accounting Standards
      Board Staff Position Emerging Issues Task Force No. 03-6-1, Determining
      Whether Instruments Granted in Share-Based Payment Transactions are
      Participating Securities effective January 1, 2009. Accordingly, this
      Preliminary Statement of Operations Information has been prepared to
      reflect the adoption of these standards.



    Attachment A
    Raytheon Company
    Pro Forma Statement of Operations Information *
    Quarters 2008

    (In millions, except
     per share amounts)                    Three Months Ended
                                           ------------------
                               30-Mar-08  29-Jun-08  28-Sep-08  31-Dec-08
                               ---------  ---------  ---------  ---------

    Net sales                     $5,354     $5,870     $5,864     $6,086
                                  ------     ------     ------     ------
    Operating expenses
      Cost of sales                4,258      4,664      4,664      4,903
      Administrative and
       selling expenses              380        396        380        392
      Research and development
       expenses                      107        142        130        138
                                     ---        ---        ---        ---

    Total operating expenses       4,745      5,202      5,174      5,433
                                   -----      -----      -----      -----

    Operating income                 609        668        690        653
                                     ---        ---        ---        ---

      Interest expense                34         34         29         32
      Interest income                (23)       (17)       (16)        (8)
      Other expense (income),
       net                             5         (2)        18         12
                                       -         --         --         --

    Non-operating expense, net        16         15         31         36
                                      --         --         --         --

    Income from continuing
     operations before taxes         593        653        659        617

    Federal and foreign income
     taxes                           192        221        222        189
                                     ---        ---        ---        ---

    Income from continuing
     operations                      401        432        437        428

    Loss from discontinued
     operations, net of tax           (2)         -          -          -
                                      --          -          -          -

    Net income                       399        432        437        428
                                     ---        ---        ---        ---

      Less: Net income
       attributable to
       noncontrolling
       interests                       1          6         10          7
                                       -          -         --          -

    Net income attributable to
     Raytheon Company               $398       $426       $427       $421
                                    ====       ====       ====       ====

    Basic earnings (loss) per
     share attributable to
     Raytheon Company
     common stockholders:
       Income from continuing
        operations                 $0.94      $1.02      $1.03      $1.03
       Discontinued operations     (0.01)         -          -          -
       Net income                   0.94       1.02       1.03       1.03

    Diluted earnings (loss) per
     share attributable to
     Raytheon Company
     common stockholders:
       Income from continuing
        operations                 $0.92      $0.99      $1.01      $1.01
       Discontinued operations     (0.01)         -          -          -
       Net income                   0.92       0.99       1.00       1.01

    Amounts attributable to
     Raytheon Company common
     stockholders:
      Income from continuing
       operations                   $400       $426       $427       $421
      Loss from discontinued
       operations                     (2)         -          -          -
                                      --          -          -          -
      Net income                    $398       $426       $427       $421
                                    ====       ====       ====       ====

    Average shares outstanding
      Basic                        423.8      419.7      415.6      409.8
      Diluted                      434.7      430.0      424.9      416.4

    * On January 1, 2009, we adopted Statement of Financial Accounting
      Standards No. 160, Noncontrolling Interests, and Financial Accounting
      Standards Board Staff Position Emerging Issues Task Force No. 03-6-1,
      Determining Whether Instruments Granted in Share-Based Payment
      Transactions are Participating Securities. This Pro Forma Statement of
      Operations Information has been prepared to reflect the adoption of
      these standards.



    Attachment A
    Raytheon Company
    Pro Forma Statement of Operations Information *
    Full Year 2005 through 2008

    (In millions, except
     per share amounts)                    Twelve Months Ended
                                           -------------------
                               31-Dec-08  31-Dec-07  31-Dec-06  31-Dec-05
                               ---------  ---------  ---------  ---------

    Net sales                    $23,174    $21,301    $19,707    $18,491
                                 -------    -------    -------    -------
    Operating expenses
      Cost of sales               18,489     17,011     15,955     15,205
      Administrative and
       selling expenses            1,548      1,434      1,322      1,228
      Research and development
       expenses                      517        502        464        430
                                     ---        ---        ---        ---

    Total operating expenses      20,554     18,947     17,741     16,863
                                  ------     ------     ------     ------

    Operating income               2,620      2,354      1,966      1,628
                                   -----      -----      -----      -----

      Interest expense               129        196        272        305
      Interest income                (64)      (163)       (75)       (39)
      Other expense (income),
       net                            33         70        (44)       (13)
                                      --         --        ---        ---

    Non-operating expense, net        98        103        153        253
                                      --        ---        ---        ---

    Income from continuing
     operations before taxes       2,522      2,251      1,813      1,375

    Federal and foreign income
     taxes                           824        532        604        468
                                     ---        ---        ---        ---

    Income from continuing
     operations                    1,698      1,719      1,209        907

    Operating (loss) income from
     discontinued operations,
     net of tax                       (2)       (57)        96        (27)
    Net gain on sales of
     discontinued operations,
     net of tax                        -        942          -          -
                                      --        ---         --         --

    (Loss) income from discontinued
     operations, net of tax           (2)       885         96        (27)
                                      --        ---         --        ---

    Net income                     1,696      2,604      1,305        880
                                   -----      -----      -----        ---

      Less: Net income
       attributable to
       noncontrolling
       interests                      24         26         22          9
                                      --         --         --          -

    Net income attributable to
     Raytheon Company             $1,672     $2,578     $1,283       $871
                                  ======     ======     ======       ====

    Basic earnings (loss) per
     share attributable to
     Raytheon Company
     common stockholders:
      Income from continuing
       operations                  $4.01      $3.86      $2.66      $1.99
      Discontinued operations      (0.01)      2.02       0.21      (0.06)
      Net income                    4.01       5.88       2.87       1.93

    Diluted earnings (loss)
     per share attributable to
     Raytheon Company
     common stockholders:
      Income from continuing
       operations                  $3.93      $3.78      $2.62      $1.97
      Discontinued operations      (0.01)      1.97       0.21      (0.06)
      Net income                    3.92       5.75       2.83       1.91

    Amounts attributable to
     Raytheon Company common
     stockholders:
      Income from continuing
       operations                 $1,674     $1,693     $1,187       $898
      (Loss) income from
        discontinued operations       (2)       885         96        (27)
                                      --        ---         --        ---
       Net income                 $1,672     $2,578     $1,283       $871
                                  ======     ======     ======       ====

    Average shares outstanding
      Basic                        417.2      438.6      447.2      451.0
      Diluted                      426.5      448.4      453.9      455.9

    * On January 1, 2009, we adopted Statement of Financial Accounting
      Standards No. 160, Noncontrolling Interests, and Financial Accounting
      Standards Board Staff Position Emerging Issues Task Force No. 03-6-1,
      Determining Whether Instruments Granted in Share-Based Payment
      Transactions are Participating Securities. This Pro Forma Statement
      of Operations Information has been prepared to reflect the adoption of
      these standards.



    Attachment B
    Raytheon Company
    Preliminary Segment Information*
    First Quarter 2009

                                                                 Operating
                                                                   Income
                                                                As a Percent
     (In millions,        Net Sales        Operating Income       of Sales
     except percentages) Three Months       Three Months         Three Months
                            Ended               Ended               Ended
                         -------------      -------------       -------------
                      29-Mar-  30-Mar    29-Mar    30-Mar    29-Mar  30-Mar
                        09       -08        -09      -08       -09     -08
                      -------  -------   -------   ------    ------- -------

    Integrated Defense
     Systems           $1,262   $1,192     $188     $211     14.9%     17.7%
    Intelligence and
     Information
     Systems              784      692       61       52      7.8%      7.5%
    Missile Systems     1,368    1,319      158      139     11.5%     10.5%
    Network Centric
     Systems            1,154    1,067      163      124     14.1%     11.6%
    Space and Airborne
     Systems            1,046      977      139      117     13.3%     12.0%
    Technical Services    696      521       44       35      6.3%      6.7%
    FAS/CAS Pension
     Adjustment             -        -       11      (33)
    Corporate and
     Eliminations        (426)    (414)     (52)     (36)
                         ----     ----      ---      ---

    Total              $5,884   $5,354     $712     $609     12.1%     11.4%
                       ======   ======     ====     ====


    * This Preliminary Segment Information was prepared on the same basis as
      our annual consolidated financial statements, except for the adoption
      of Statement of Financial Accounting Standards No. 160, Noncontrolling
      Interest, and the reorganization of a U.K. manufacturing facility from
      Space and Airborne Systems to Missile Systems. These changes became
      effective on January 1, 2009.



    Attachment B
    Raytheon Company
    Pro Forma Segment Information *
    Quarters 2008 and Full Year 2006 through 2008


                                                 Net Sales
    (In millions, except percentages)       Three Months Ended
                                            ------------------
                                30-Mar-08  29-Jun-08  28-Sep-08  31-Dec-08
                                ---------  ---------  ---------  ---------
    Integrated Defense Systems     $1,192     $1,257     $1,276     $1,423
    Intelligence and Information
     Systems                          692        829        801        810
    Missile Systems                 1,319      1,363      1,360      1,366
    Network Centric Systems         1,067      1,173      1,145      1,125
    Space and Airborne Systems        977      1,072      1,065      1,166
    Technical Services                521        647        689        744
    Corporate and Eliminations       (414)      (471)      (472)      (548)
                                     ----       ----       ----       ----

    Total                          $5,354     $5,870     $5,864     $6,086
                                   ======     ======     ======     ======


                                                      Net Sales
    (In millions, except percentages)            Twelve Months Ended
                                                 -------------------
                                           31-Dec-08  31-Dec-07  31-Dec-06
                                           ---------  ---------  ---------
    Integrated Defense Systems                $5,148     $4,695     $4,220
    Intelligence and Information
     Systems                                   3,132      2,742      2,560
    Missile Systems                            5,408      5,026      4,535
    Network Centric Systems                    4,510      4,164      3,561
    Space and Airborne Systems                 4,280      4,202      4,224
    Technical Services                         2,601      2,174      2,153
    Corporate and Eliminations                (1,905)    (1,702)    (1,546)
                                              ------     ------     ------

    Total                                    $23,174    $21,301    $19,707
                                             =======    =======    =======



                                            Operating Income
                                            Three Months Ended
                                            ------------------
                                30-Mar-08  29-Jun-08  28-Sep-08  31-Dec-08
                                ---------  ---------  ---------  ---------
    Integrated Defense Systems       $211       $209       $206       $244
    Intelligence and Information
     Systems                           52         67         67         67
    Missile Systems                   139        158        145        142
    Network Centric Systems           124        151        152        148
    Space and Airborne Systems        117        141        144        167
    Technical Services                 35         45         45         49
    FAS/CAS Pension Adjustment        (33)       (34)       (26)       (30)
    Corporate and Eliminations        (36)       (69)       (43)      (134)
                                      ---        ---        ---       ----

    Total                            $609       $668       $690       $653
                                     ====       ====       ====       ====


                                                   Operating Income
                                                 Twelve Months Ended
                                                 -------------------
                                           31-Dec-08  31-Dec-07  31-Dec-06
                                           ---------  ---------  ---------
    Integrated Defense Systems                  $870       $828       $691
    Intelligence and Information
     Systems                                     253        248        234
    Missile Systems                              584        543        483
    Network Centric Systems                      575        532        401
    Space and Airborne Systems                   569        556        599
    Technical Services                           174        139        153
    FAS/CAS Pension Adjustment                  (123)      (259)      (362)
    Corporate and Eliminations                  (282)      (233)      (233)
                                                ----       ----       ----

    Total                                     $2,620     $2,354     $1,966
                                              ======     ======     ======



                                Operating Income as a Percentage of Sales
                                           Three Months Ended
                                            ------------------
                                30-Mar-08  29-Jun-08  28-Sep-08  31-Dec-08
                                ---------  ---------  ---------  ---------
    Integrated Defense Systems      17.7%      16.6%      16.1%      17.1%
    Intelligence and Information
     Systems                         7.5%       8.1%       8.4%       8.3%
    Missile Systems                 10.5%      11.6%      10.7%      10.4%
    Network Centric Systems         11.6%      12.9%      13.3%      13.2%
    Space and Airborne Systems      12.0%      13.2%      13.5%      14.3%
    Technical Services               6.7%       7.0%       6.5%       6.6%
    FAS/CAS Pension Adjustment
    Corporate and Eliminations

    Total                           11.4%      11.4%      11.8%      10.7%


                                                   Operating Income
                                                 As a Percent of Sales
                                                   Twelve Months Ended
                                                   -------------------
                                            31-Dec-08  31-Dec-07  31-Dec-06
                                            ---------  ---------  ---------

    Integrated Defense Systems                  16.9%      17.6%      16.4%
    Intelligence and Information
     Systems                                     8.1%       9.0%       9.1%
    Missile Systems                             10.8%      10.8%      10.7%
    Network Centric Systems                     12.7%      12.8%      11.3%
    Space and Airborne Systems                  13.3%      13.2%      14.2%
    Technical Services                           6.7%       6.4%       7.1%
    FAS/CAS Pension Adjustment
    Corporate and Eliminations

    Total                                       11.3%      11.1%      10.0%

    * On January 1, 2009, we adopted Statement of Financial Accounting
      Standards No. 160, Noncontrolling Interests. Additionally, the
      composition of Space and Airborne Systems was changed to exclude a U.K.
      manufacturing facility, which now reports directly to Missile Systems.
      This Pro Forma Segment Information has been prepared to reflect these
      changes.



    Attachment C
    Raytheon Company
    Other Preliminary Information*
    First Quarter 2009


    (In millions)                     Funded Backlog       Total Backlog
                                      --------------       -------------
                                  29-Mar-09  31-Dec-08 29-Mar-09 31-Dec-08
                                  ---------  --------- --------- ---------
    Integrated Defense Systems       $5,735     $4,802    $9,684    $9,883
    Intelligence and Information
     Systems                          1,761      1,890     4,818     5,137
    Missile Systems                   5,605      6,082     9,355     9,937
    Network Centric Systems           4,816      4,593     5,850     5,733
    Space and Airborne Systems        3,284      2,731     5,613     5,442
    Technical Services                1,821      1,888     2,619     2,752
                                      -----      -----     -----     -----

    Total                           $23,022    $21,986   $37,939   $38,884
                                    =======    =======   =======   =======



                                 Bookings
                            Three Months Ended
                        -----------------------
                        29-Mar-09     30-Mar-08
                        ---------     ---------

    Total Bookings        $5,209        $6,516
                          ======        ======


    * This Other Preliminary Information was prepared on the same basis as
      our annual consolidated financial statements, except for the
      reorganization of a U.K. manufacturing facility from Space and
      Airborne Systems to Missile Systems.


    Attachment C
    Raytheon Company
    Other Pro Forma Information *
    Quarters 2008 and Full Year 2006 through 2008



    (In millions)           Funded Backlog                 Total Backlog
                         Twelve Months Ended           Twelve Months Ended
                         -------------------           -------------------
                      31-Dec    31-Dec    31-Dec     31-Dec    31-Dec   31-Dec
                       -08       -07       -06        -08       -07       -06
                      ------    ------    ------     ------    ------    -----

    Integrated Defense
     Systems          $4,802    $4,781    $4,088    $9,883    $9,296    $7,934
    Intelligence and
     Information
     Systems           1,890     2,325       893     5,137     5,636     3,935
    Missile Systems    6,082     5,295     5,216     9,937     9,456     9,585
    Network Centric
     Systems           4,593     3,957     4,037     5,733     5,102     5,059
    Space and
     Airborne
     Systems           2,731     2,960     2,689     5,442     5,199     5,510
    Technical
     Services          1,888     1,200     1,263     2,752     1,925     1,815
                       -----     -----     -----     -----     -----     -----

    Total            $21,986   $20,518   $18,186   $38,884   $36,614   $33,838
                     =======   =======   =======   =======   =======   =======





    (In millions)                                 Total Bookings
                                                Twelve Months Ended
                                                -------------------
                                             31-Dec-08 31-Dec-07 31-Dec-06
                                             --------- --------- ---------

    Integrated Defense Systems                  $5,933    $6,066    $4,118
    Intelligence and Information Systems         3,204     4,900     2,701
    Missile Systems                              6,043     4,954     6,050
    Network Centric Systems                      4,938     3,904     4,037
    Space and Airborne Systems                   3,927     3,968     3,992
    Technical Services                           2,753     1,610     1,418
    Corporate                                       22        96       101
                                                    --        --       ---

    Total                                      $26,820   $25,498   $22,417
                                               =======   =======   =======



    (In millions)                                Total Bookings
                                               Three Months Ended
                                               ------------------
                                    30-Mar-08 29-Jun-08 28-Sep-08 31-Dec-08
                                    --------- --------- --------- ---------

    Integrated Defense Systems        $1,106      $981      $516    $3,330
    Intelligence and Information
     Systems                           1,019       776       698       711
    Missile Systems                    1,642     1,941     1,102     1,358
    Network Centric Systems            1,592       895     1,090     1,361
    Space and Airborne Systems           728       809     1,087     1,303
    Technical Services                   418       595     1,273       467
    Corporate                             11        11         -         -
                                          --        --        --        --

    Total                             $6,516    $6,008    $5,766    $8,530
                                      ======    ======    ======    ======

    * On January 1, 2009, the composition of Space and Airborne Systems was
      changed to exclude a U.K. manufacturing facility, which now reports
      directly to Missile Systems. This Other Pro Forma Information has been
      prepared to reflect this change.



    Attachment D
    Raytheon Company
    Preliminary Balance Sheet Information*
    First Quarter 2009

    (In millions)
                                                      29-Mar-09  31-Dec-08
                                                      ---------  ---------
    Assets
      Cash and cash equivalents                          $2,210     $2,259
      Accounts receivable, net                              106        105
      Contracts in process                                4,257      3,793
      Inventories                                           275        325
      Current tax asset                                      13        441
      Deferred taxes                                        390        395
      Prepaid expenses and other current assets              88         99
                                                             --         --
          Total current assets                            7,339      7,417

    Property, plant and equipment, net                    1,981      2,024
    Deferred taxes                                          704        735
    Prepaid retiree benefits                                 64         56
    Goodwill                                             11,661     11,662
    Other assets, net                                     1,130      1,240
                                                          -----      -----
                Total assets                            $22,879    $23,134
                                                        =======    =======

    Liabilities and Equity
    Current liabilities
      Advance payments and billings in excess of costs
       incurred                                          $1,794     $1,970
      Accounts payable                                    1,209      1,201
      Accrued employee compensation                         567        913
      Other accrued expenses                              1,098      1,065
                                                          -----      -----
          Total current liabilities                       4,668      5,149

    Accrued retiree benefits and other long-term
     liabilities                                          6,614      6,488
    Long-term debt                                        2,297      2,309

    Equity
      Raytheon Company stockholders' equity
         Common stock                                         4          4
         Additional paid-in capital                      10,866     10,873
         Accumulated other comprehensive loss            (5,132)    (5,182)
         Treasury stock, at cost                         (4,523)    (4,254)
         Retained earnings                                7,976      7,646
                                                          -----      -----
           Total Raytheon Company stockholders'
            equity                                        9,191      9,087
         Noncontrolling interest in subsidiaries            109        101
                                                            ---        ---
               Total equity                               9,300      9,188
                                                          -----      -----
               Total liabilities and equity             $22,879    $23,134
                                                        =======    =======


    * This Preliminary Balance Sheet Information has been prepared on the
      same basis as our annual consolidated financial statements, except
      for the adoption of the Statements of Accounting Standards No. 160,
      Noncontrolling Interests effective January 1, 2009.




    Attachment D
    Raytheon Company
    Pro Forma Balance Sheet Information *


    (In millions)                            Twelve Months Ended
                                             -------------------
                                 31-Dec-08  31-Dec-07  31-Dec-06  31-Dec-05
                                 ---------  ---------  ---------  ---------
    Assets
      Cash and cash equivalents     $2,259     $2,655     $2,460     $1,202
      Accounts receivable, net         105        126        141        142
      Contracts in process           3,793      3,821      3,600      3,441
      Inventories                      325        386        376        420
      Current tax asset                441         98          -          -
      Deferred taxes                   395        432        257        355
      Prepaid expenses and other
       current assets                   99         98        108        131
      Assets held for sale               -          -      2,575      3,079
                                        --         --      -----      -----
        Total current assets         7,417      7,616      9,517      8,770

    Property, plant and equipment,
     net                             2,024      2,058      2,025      1,997
    Deferred taxes                     735          -        170        (27)
    Prepaid retiree benefits            56        617        527        710
    Goodwill                        11,662     11,627     11,461     11,421
    Assets held for sale                 -          -        374          -
    Other assets, net                1,240      1,234      1,322      1,455
                                     -----      -----      -----      -----
        Total assets               $23,134    $23,152    $25,396    $24,326
                                   =======    =======    =======    =======

    Liabilities and Equity
    Current liabilities
      Notes payable and current
       portion of long-term debt        $-         $-       $687        $54
      Subordinated notes payable         -          -          -        408
      Advance payments and billings
       in excess of costs incurred   1,970      1,845      1,885      1,560
      Accounts payable               1,201      1,141        910        789
      Accrued employee compensation    913        902        937        931
      Other accrued expenses         1,065        900      1,043      1,054
      Liabilities held for sale          -          -      1,253      1,539
                                        --         --      -----      -----
         Total current liabilities   5,149      4,788      6,715      6,335

    Accrued retiree benefits and
     other long-term liabilities     6,488      3,016      4,053      3,190
    Deferred taxes                       -        451          -         59
    Long-term debt                   2,309      2,268      3,278      3,969
    Liabilities held for sale            -          -        179          -

    Equity
      Raytheon Company
       stockholders' equity
         Common stock                    4          4          5          5
         Additional paid-in
          capital                   10,873     10,544     10,097      9,722
         Accumulated other
          comprehensive loss        (5,182)    (1,956)    (2,514)    (2,039)
         Treasury stock, at cost    (4,254)    (2,502)      (816)      (454)
         Retained earnings           7,646      6,452      4,329      3,475
                                     -----      -----      -----      -----
             Total Raytheon Company
              stockholders' equity   9,087     12,542     11,101     10,709
      Noncontrolling interest in
       subsidiaries                    101         87         70         64
                                       ---         --         --         --
             Total equity            9,188     12,629     11,171     10,773
                                     -----     ------     ------     ------
             Total liabilities
              and equity           $23,134    $23,152    $25,396    $24,326
                                   =======    =======    =======    =======

    * On January 1, 2009, we adopted Statement of Accounting Standards No.
      160, Noncontrolling Interests.  This Pro Forma Balance Sheet
      Information has been prepared to reflect the adoption of this standard.



    Attachment E
    Raytheon Company
    Preliminary Cash Flow Information*
    First Quarter 2009

    (In millions)                                      Three Months Ended
                                                      --------------------
                                                      29-Mar-09  30-Mar-08
                                                      ---------  ---------

    Net income                                             $460       $399
    (Income) loss from discontinued operations,
      net of tax                                             (3)         2
                                                             --          -
    Income from continuing operations                       457        401

    Depreciation                                             71         69
    Amortization                                             26         23
    Net income attributable to noncontrolling interest       (8)        (1)
    Working capital (excluding pension and taxes)**        (938)      (703)
    Discontinued operations                                  (6)       (10)
    Net activity in financing receivables                     9         20
    Other                                                   794        258
                                                            ---        ---
          Net operating cash flow                           405         57

    Capital spending                                        (33)       (43)
    Internal use software spending                          (13)       (17)
    Dividends                                              (112)      (109)
    Repurchases of common stock                            (300)      (340)
    Other                                                     4         84
                                                             --         --
          Total cash flow                                  $(49)     $(368)
                                                           ====      =====


    * This Preliminary Cash Flow Information has been prepared on the same
      basis as our annual consolidated financial statements, except for the
      adoption of Statement of Accounting Standards No. 160, Noncontrolling
      Interests.

    ** Working capital (excluding pension and taxes) is a summation of
       changes in: accounts receivable, net, contracts in process and
       advance payments and billings in excess of costs incurred,
       inventories, prepaid expenses and other current assets, accounts
       payable, accrued employee compensation, and other accrued expenses
       from the Statements of Cash Flows.



    Attachment E
    Raytheon Company
    Pro Forma Cash Flow Information *
    Quarters 2008 and Full Year 2006 through 2008

                                                 Twelve Months Ended
                                                 -------------------
    (In millions)                          31-Dec-08  31-Dec-07  31-Dec-06
                                           ---------  ---------  ---------

    Net income                                $1,696     $2,604     $1,305
    Loss (income) from discontinued
     operations, net of tax                        2       (885)       (96)
                                                  --       ----        ---
    Income from continuing operations          1,698      1,719      1,209

    Depreciation                                 292        288        285
    Amortization                                  98         84         76
    Net income attributable to noncontrolling
     interests                                   (24)       (26)       (22)
    Working capital (excluding pension
     and taxes)**                                247        (85)       377
    Discontinued operations                      (21)       (51)       266
    Net activity in financing receivables         68         88        168
    Other                                       (343)      (819)       384
                                                ----       ----        ---
        Net operating cash flow                2,015      1,198      2,743

    Capital spending                            (304)      (313)      (294)
    Internal use software spending               (74)       (85)       (77)
    Acquisitions                                 (54)      (211)       (87)
    Investment activity and divestitures           9      3,143         53
    Dividends                                   (460)      (440)      (420)
    Repurchase of common stock                (1,700)    (1,642)      (352)
    Debt repayments                                -     (1,724)      (437)
    Discontinued operations                        -        (29)       (73)
    Other                                        172        298        202
                                                 ---        ---        ---
        Total cash flow                        $(396)      $195     $1,258
                                               =====       ====     ======



                                           Three Months Ended
                                           ------------------
    (In millions)              30-Mar-08  29-Jun-08  28-Sep-08  31-Dec-08
                               ---------  ---------  ---------  ---------

    Net income                      $399       $432       $437       $428
    Loss (income) from
     Discontinued operations,
     net of tax                        2          -          -          -
                                      --         --         --         --
    Income from continuing
     operations                      401        432        437        428

    Depreciation                      69         73         75         75
    Amortization                      23         24         24         27
    Net income attributable to
     noncontrolling interests         (1)        (6)       (10)        (7)
    Working capital (excluding
     pension and taxes)**           (703)       318          3        629
    Discontinued operations          (10)        (6)        (5)         -
    Net activity in financing
     receivables                      20          5         21         22
    Other                            258        (79)       208       (730)
                                     ---        ---        ---       ----
        Net operating cash flow       57        761        753        444

    Capital spending                 (43)       (56)       (68)      (137)
    Internal use software spending   (17)       (13)       (28)       (16)
    Acquisitions                       -        (33)       (20)         -
    Investment activity and
     divestitures                      -          9          -          -
    Dividends                       (109)      (118)      (117)      (116)
    Repurchase of common stock      (340)      (340)      (340)      (680)
    Other                             84         57         27          3
                                      --         --         --          -
        Total cash flow            $(368)      $267       $207      $(502)
                                   =====       ====       ====      =====


    * On January 1, 2009, we adopted Statement of Financial Accounting
      Standards No. 160, Noncontrolling Interests.  This Pro Forma Cash
      Flow Information has been prepared to reflect the adoption of this
      standard.

    ** Working capital (excluding pension and taxes) is a summation of
       changes in: accounts receivable, net, contracts in process and
       advance payments and billings in excess of costs incurred,
       inventories, prepaid expenses and other current assets, accounts
       payable, accrued employee compensation, and other accrued expenses
       from the Statements of Cash Flows.



    Attachment F
    Raytheon Company
    Preliminary Return on Invested Capital Non-GAAP Financial Measure
    First Quarter 2009

    We define Return on Invested Capital (ROIC) as income from continuing
    operations plus after-tax net interest expense plus one-third of
    operating lease expense after-tax (estimate of interest portion of
    operating lease expense) divided by average invested capital after
    capitalizing operating leases (operating lease expense times a
    multiplier of 8), adding financial guarantees less net investment in
    Discontinued Operations, and adding back the impact of Statement of
    Financial Accounting Standards No. 158, Employers' Accounting for
    Defined Benefit Pension and Other Postretirement Plans (SFAS No. 158).
    ROIC is not a measure of financial performance under generally accepted
    accounting principles (GAAP) and may not be defined and calculated by
    other companies in the same manner.  ROIC should be considered
    supplemental to and not a substitute for financial information prepared
    in accordance with GAAP. We use ROIC as a measure of efficiency and
    effectiveness of our use of capital and as an element of management
    compensation.

    Return on Invested Capital

    (In millions, except percentages)      2009 Current Guidance
                                           ---------------------
                                            Low end    High end
                                           of range    of range
                                           --------    --------
    Income from continuing operations
    Net interest expense, after-tax*       Combined    Combined
    Lease expense, after-tax*
                                            ------      ------
    Return                                  $1,970      $2,030
                                            ------      ------

    Net debt **
    Equity less investment in
     discontinued operations
    Lease expense x 8, plus
     financial guarantees                  Combined    Combined
    SFAS No. 158 impact

                                             -------     -------
    Invested capital from
     continuing operations***                $17,700     $17,500
                                             -------     -------

                                                ----        ----
    ROIC                                       11.1%       11.6%
                                               =====       =====

    *   Effective 2009 tax rate: approximately 33% (2009 guidance)
    **  Net debt is defined as total debt less cash and cash equivalents and
        is calculated using a 2 point average
    *** Calculated using a 2 point average

SOURCE: Raytheon Company

Web site: http://www.raytheon.com/

Company News On-Call: http://www.prnewswire.com/comp/149999.html

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