LHX

L3HARRIS TECHNOLOGIES INC

Industrials | Large Cap

$3.55

EPS Forecast

$5,487

Revenue Forecast

Announcing earnings for the quarter ending 2024-12-31 soon
EX-99.1 2 resegmentationfinancials.htm EX-99.1 Document


Table 1
L3HARRIS TECHNOLOGIES, INC.
HISTORICAL BUSINESS SEGMENT INFORMATION
AS RECLASSIFIED FOR SEGMENT CHANGES
(Unaudited)
Fiscal Transition PeriodFiscal 2020Fiscal 2021
Quarter EndedQuarter EndedQuarter Ended
(In millions)9/27/20191/3/20204/3/20207/3/202010/2/20201/1/20214/2/20217/2/202110/1/2021
Revenue
Integrated Mission Systems$1,636 $1,885 $1,747 $1,615 $1,667 $1,764 $1,751 $1,792 $1,649 
Space & Airborne Systems1,383 1,423 1,406 1,469 1,471 1,477 1,460 1,510 1,494 
Communication Systems1,024 1,105 1,080 1,093 1,086 1,143 1,112 1,127 1,030 
Other non-reportable businesses (A)424 469 431 315 280 321 284 282 95 
Corporate eliminations(36)(50)(38)(47)(41)(45)(40)(43)(39)
$4,431 $4,832 $4,626 $4,445 $4,463 $4,660 $4,567 $4,668 $4,229 
Net Income
Segment Operating Income (Loss):
Integrated Mission Systems (B)$193 $228 $(96)$148 $207 $(54)$234 $142 $232 
Space & Airborne Systems (B)186 174 174 192 189 207 192 204 187 
Communication Systems (B)226 247 239 249 261 286 270 276 258 
Other non-reportable businesses (A)(B)37 46 47 35 29 49 52 41 7 
642 695 364 624 686 488 748 663 684 
% of total revenue14.5 %14.4 %7.9 %14.0 %15.4 %10.5 %16.4 %14.2 %16.2 %
Unallocated Items:
Unallocated corporate department expense, net(1)2 (10)(21)(21)(18)(33)(24)(2)
L3Harris Merger-related integration and transaction expenses (C)(281)(61)(31)(44)(27)(38)(21)(20)(34)
Amortization of acquisition-related intangibles(123)(166)(145)(208)(176)(180)(164)(156)(155)
Additional cost of sales related to fair value step-up in inventory sold(92)(50)(15)(16)— — — — — 
Business divestiture-related gains (losses)229 — (3)(49)(10)11 (15)180 27 
Asset disposal gains12 — — — — 22 — — — 
Impairment of goodwill and other assets— (46)(5)(14)— (113)(62)(63)— 
Other items(12)— — (9)(2)— (7)(49)(8)
FAS/CAS operating adjustment (D)45 46 34 33 34 34 30 30 30 
(223)(275)(175)(328)(202)(282)(272)(102)(142)
Non-operating income, net79 113 95 105 96 105 117 86 111 
Income from continuing operations before interest and income taxes (“EBIT”)498 533 284 401 580 311 593 647 653 
% of total revenue11.2 %11.0 %6.1 %9.0 %13.0 %6.7 %13.0 %13.9 %15.4 %
Interest expense, net(58)(65)(63)(65)(62)(64)(66)(65)(67)
Income taxes(5)(68)(26)(58)(87)(63)(60)(169)(107)
Income from continuing operations435 400 195 278 431 184 467 413 479 
Discontinued operations, net of income taxes— (1)(1)— (1)— (1)— — 
Net income435 399 194 278 430 184 466 413 479 
% of total revenue9.8 %8.3 %4.2 %6.3 %9.6 %3.9 %10.2 %8.8 %11.3 %
Note A — Includes the results of divested businesses through the date of divestiture.
Note B — Adjusted to remove FAS pension and OPEB income and to include CAS pension and OPEB cost.
Note C — Includes change in control charges.
Note D — Represents the difference between the service cost component of FAS pension and OPEB income and total CAS pension and OPEB cost and replaces the “Pension adjustment” line item previously presented, which included the non-service cost components of FAS pension and OPEB income.


L3HARRIS TECHNOLOGIES, INC.
HISTORICAL BUSINESS SEGMENT INFORMATION
AS RECLASSIFIED FOR SEGMENT CHANGES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES AND REGULATION G DISCLOSURE
Table 2 includes additional measures of income from continuing operations, net income, net income margin, segment operating income (loss) and segment operating income (loss) margin provided to supplement our selected historical financial information calculated in accordance with U.S. generally accepted accounting principles (GAAP). L3Harris management believes that these non-GAAP financial measures, when considered together with the GAAP financial measures, provide information that is useful to investors in understanding period-over-period operating results separate and apart from items that may, or could, have a disproportionately positive or negative impact on results in any particular period. L3Harris management also believes that these non-GAAP financial measures enhance the ability of investors to analyze L3Harris’ business trends and to understand L3Harris’ performance. In addition, L3Harris may utilize non-GAAP financial measures as guides in its forecasting, budgeting, and long-term planning processes and to measure operating performance for some management compensation purposes. Any analysis of non-GAAP financial measures should be used only in conjunction with results presented in accordance with GAAP. The notes accompanying Table 2 provide a reconciliation of these non-GAAP financial measures with the most directly comparable financial measures calculated in accordance with GAAP.





Table 2
L3HARRIS TECHNOLOGIES, INC.
HISTORICAL NON-GAAP BUSINESS SEGMENT INFORMATION
AS RECLASSIFIED FOR SEGMENT CHANGES
(Unaudited)
Fiscal Transition PeriodFiscal 2020Fiscal 2021
Quarter EndedQuarter EndedQuarter Ended
(In millions)9/27/20191/3/20204/3/20207/3/202010/2/20201/1/20214/2/20217/2/202110/1/2021
Revenue
Integrated Mission Systems$1,636 $1,885 $1,747 $1,615 $1,667 $1,764 $1,751 $1,792 $1,649 
Space & Airborne Systems1,383 1,423 1,406 1,469 1,471 1,477 1,460 1,510 1,494 
Communication Systems1,024 1,105 1,080 1,093 1,086 1,143 1,112 1,127 1,030 
Other non-reportable businesses (A)424 469 431 315 280 321 284 282 95 
Corporate eliminations(36)(50)(38)(47)(41)(45)(40)(43)(39)
$4,431 $4,832 $4,626 $4,445 $4,463 $4,660 $4,567 $4,668 $4,229 
Net Income***
Segment Operating Income***:
Integrated Mission Systems***(B)(C)$193 $228 $229 $217 $210 $203 $234 $224 $232 
Space & Airborne Systems (B)186 174 174 192 189 207 192 204 187 
Communication Systems (B)226 247 239 249 261 286 270 276 258 
Other non-reportable businesses (A)(B)37 46 47 35 29 49 52 41 7 
642 695 689 693 689 745 748 745 684 
% of total revenue***14.5 %14.4 %14.9 %15.6 %15.4 %16.0 %16.4 %16.0 %16.2 %
Unallocated Items***(D):
Unallocated corporate department expense(1)2 (10)(21)(21)(18)(33)(24)(2)
FAS/CAS operating adjustment (E)45 46 34 33 34 34 30 30 30 
44 48 24 12 13 16 (3)6 28 
Non-operating income, net***(F)80 92 95 105 96 103 117 118 118 
Adjusted EBIT***766 835 808 810 798 864 862 869 830 
% of total revenue***17.3 %17.3 %17.5 %18.2 %17.9 %18.5 %18.9 %18.6 %19.6 %
Interest expense, net(58)(65)(63)(65)(62)(64)(66)(65)(67)
Income taxes***(G)(121)(130)(127)(126)(125)(136)(133)(132)(116)
Income from continuing operations***587 640 618 619 611 664 663 672 647 
Discontinued operations, net of income taxes— (1)(1)— (1)— (1)— — 
Net income***587 639 617 619 610 664 662 672 647 
% of total revenue***13.2 %13.2 %13.3 %13.9 %13.7 %14.2 %14.5 %14.4 %15.3 %
***Non-GAAP financial measure; refer to the notes below for reconciliations.
Note A — Includes the results of divested businesses through the date of divestiture.
Note B — Adjusted to remove FAS pension and OPEB income and to include CAS pension and OPEB cost.
Note C — Adjusted to exclude (1) impairment charges totaling $634 million and $82 million for fiscal years 2020 and 2021, respectively, related to goodwill and other assets and (2) restructuring charges and other items totaling $20 million for fiscal year 2020.
Note D — Adjusted to exclude (1) L3Harris Merger-related integration, transaction and other expenses and losses totaling $342 million, $140 million and $75 million for the fiscal transition period, fiscal 2020 and first three quarters of fiscal 2021, respectively; (2) amortization of acquisition-related intangibles totaling $289 million, $709 million and $475 million for the fiscal transition period, fiscal 2020 and first three quarters of fiscal 2021, respectively; (3) additional cost of sales related to the fair value step-up of inventory sold totaling $142 million and $31 million for the fiscal transition period and fiscal 2020, respectively; (4) net business divestiture-related gains of $229 million and $192 million for the fiscal transition period and first three quarters of fiscal 2021 and a net business divestiture-related loss of $51 million in fiscal 2020; (5) asset disposal gains totaling $12 million and $22 million for the fiscal transition period and fiscal 2020, respectively; (6) charges for the impairment of goodwill and other assets totaling $46 million, $132 million and $125 million for the fiscal transition period, fiscal 2020 and first three quarters of fiscal 2021, respectively; and (7) other items totaling $12 million, $11 million and $64 million for the fiscal transition period, fiscal 2020 and first three quarters of fiscal 2021, respectively. Refer to the corresponding line item within “Unallocated items” in Table 1 for quarterly amounts for each adjustment.
Note E — Represents the difference between the service cost component of FAS pension and other postretirement benefit plan income and total CAS pension and other postretirement benefit plan cost and replaces the “Pension adjustment” line item previously presented, which included the non-service cost components of FAS pension and other postretirement benefit plan income.
Note F — Adjusted to exclude (1) a pension plan curtailment gain and other items totaling $22 million for the fiscal transition period and pension plan settlement losses totaling $4 million for fiscal 2021; (2) a $2 million debt extinguishment loss for the fiscal transition period and a debt extinguishment gain of $2 million for fiscal 2020; and (3) a $35 million charge for the impairment of an investment in an unconsolidated subsidiary for fiscal 2021.
Note G — Adjusted for the tax effect of above adjustments.