Company Website:
http://harris.com
MELBOURNE, Fla. -- (Business Wire)
Correcting second paragraph of Earnings Guidance section.
The corrected release reads:
HARRIS CORPORATION REPORTS FISCAL 2013 SECOND QUARTER RESULTS
Harris Corporation (NYSE:HRS) reported revenue in the second quarter of
fiscal 2013 of $1.29 billion compared with $1.31 billion in the prior
year. GAAP income from continuing operations was $142 million, or $1.25
per diluted share, compared with $136 million, or $1.18 per diluted
share. Non-GAAP income from continuing operations in the prior year was
$142 million, or $1.24 per diluted share. Fiscal 2012 non-GAAP amounts
exclude acquisition-related costs, and a reconciliation of GAAP to
non-GAAP financial measures is provided in the tables. Orders in the
second quarter were $1.36 billion compared with $1.04 billion in the
prior year.
“Harris second quarter results were solid in a very difficult and
uncertain government spending environment,” said William M. Brown,
president and chief executive officer. “Orders were up 30 percent
compared to the prior year with all three business segments experiencing
double-digit growth. In this current environment, we will continue to
focus on providing our customers with innovative and cost-effective
solutions, lowering costs throughout our company, increasing free cash
flow and effectively deploying capital.”
RF Communications
Revenue in the second quarter for the RF Communications segment was $486
million compared with $526 million in the prior year. Tactical
Communications revenue was $337 million, a decline of 14 percent, and
Public Safety revenue was $149 million, an increase of 10 percent.
Operating income for the RF Communications segment was $151 million
compared with $172 million in the prior year. Operating margin was 31.1
percent compared with 32.8 percent in the prior year, and reflects a
shift in product mix related to the strong revenue growth in Public
Safety.
Orders for the segment totaled $402 million, including $287 million in
Tactical Communications and $115 million in Public Safety. Book-to-bill
was .83 for the segment. At the end of the second quarter, backlog was
$561 million in Tactical Communications and $581 million in Public
Safety.
During the quarter, Harris was awarded a 5-year, $85 million,
sole-source, Indefinite Delivery Indefinite Quantity (IDIQ) contract
from the U.S. Air Force and received $33 million in initial delivery
orders for Falcon III® wideband radios to be deployed as the
next-generation platform for voice and data communications. Harris
received from a nation in Asia a $36 million order, and following the
close of the quarter, an additional $6 million for an end-to-end
integrated tactical information system incorporating Falcon III radios
to form the long distance communications backbone. Harris received $33
million in orders from a NATO country, including an initial $11 million
order for Falcon III Secure Personal Radios and a $22 million order for
Falcon III handheld radios.
Harris was also awarded two significant contracts for P25 land mobile
radio systems, a $31 million contract from the Republic of Trinidad and
Tobago and a $16 million contract for the city of Montréal's vast public
transportation network.
Integrated Network Solutions
Revenue in the second quarter for the Integrated Network Solutions
segment was $396 million, a 3 percent increase compared with $385
million in the prior year. Solid growth in CapRock Communications and
Healthcare Solutions was partially offset by a decline in IT Services
revenue, primarily from the loss of the Patriot program. Operating
income for the segment was $32 million compared with $20 million in the
prior year. Non-GAAP operating income in the prior year was $29 million.
Orders for CapRock Communications increased 21 percent while Healthcare
Solutions orders more than doubled in the second quarter compared with
the prior year. CapRock Communications received $84 million in orders
under the Defense Information Systems Agency (DISA) contract to provide
end-to-end managed terrestrial network services. Harris was also awarded
a contract extension from Royal Caribbean Cruises as well as contracts
from Baker Hughes, Anadarko, and a country in Europe totaling $35
million for satellite communications solutions.
Government Communications Systems
Revenue in the second quarter for the Government Communications Systems
segment was $439 million, a 4 percent increase compared with $422
million in the prior year. Year-over-year increases in revenue from the
GOES-R weather program, the Space Network Ground Segment Sustainment
(SGSS) program, and various classified programs were partially offset by
continued lower spending by Department of Defense customers. Operating
income was $66 million compared with $63 million in the prior year.
Operating margin was strong at 14.9 percent.
During the quarter, Harris received awards totaling $242 million from
several classified customers. Harris was also one of twenty prime
contractors selected to compete for work under the 5-year, $10 billion
Global Tactical Advanced Communication Systems (GTACS) IDIQ contract.
Discontinued Operations
Harris entered into a definitive asset sale agreement with Gores
Broadcast Solutions, Inc., an affiliate of The Gores Group, LLC,
relating to the sale of Broadcast Communications, which the company
expects to complete in early calendar year 2013. As a result, Harris
recorded an additional non-cash impairment charge of $98 million in
discontinued operations.
Earnings Guidance
Due to expected slower government spending resulting from growing budget
uncertainty, Harris has updated its fiscal 2013 guidance for income from
continuing operations from a range of $5.10 to $5.30 per share to a
range of $5.00 to $5.20 per share. Revenue is now expected to decline 2
to 4 percent compared to the prior year.
Harris will host a conference call today, January 29, at 8:30 a.m.
Eastern Time (ET) to discuss its second quarter fiscal 2013 financial
results. The dial-in numbers for the teleconference are (866) 700-0161
(U.S.) and (617) 213-8832 (International), using participant code
73824622. Please allow at least 10 minutes before the scheduled start
time to connect to the teleconference. Participants may listen to the
call and view management’s supporting slide presentation at www.harris.com/conference-call.
A recording of the call will be available on the Harris website
beginning at 12 p.m. ET on January 29.
About Harris Corporation
Harris is an international communications and information technology
company serving government and commercial markets in more than 125
countries. Headquartered in Melbourne, Florida, the company has
approximately $5.5 billion of annual revenue and about 15,000 employees
— including 6,000 engineers and scientists. Harris is dedicated to
developing best-in-class assured communications®
products, systems and services. Additional information about Harris
Corporation is available at www.harris.com.
Non-GAAP Financial Measures
This press release contains non-GAAP financial measures within the
meaning of Regulation G promulgated by the SEC, including income from
continuing operations and income from continuing operations per diluted
share for the second quarter of fiscal 2012, excluding charges for
acquisition-related costs; and operating income for the Integrated
Network Solutions segment for the second quarter of fiscal 2012,
excluding charges for acquisition-related costs. Harris 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. Management also believes that these non-GAAP
financial measures enhance the ability of investors to analyze Harris
business trends and to understand Harris performance. In addition,
Harris may utilize non-GAAP financial measures as a guide in its
forecasting, budgeting and long-term planning process 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.
Forward-Looking Statements
Statements in this press release that are not historical facts are
forward-looking statements that reflect management's current
expectations, assumptions and estimates of future performance and
economic conditions. Such statements are made in reliance upon the safe
harbor provisions of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. Forward-looking
statements in this release include but are not limited to: earnings and
revenue guidance for fiscal 2013; potential contract opportunities and
awards; the potential value of contract awards; statements regarding
outlook, including expected revenue, orders and cash flow; and
anticipated timing of the divestiture of Broadcast Communications. The
company cautions investors that any forward-looking statements are
subject to risks and uncertainties that may cause actual results and
future trends to differ materially from those matters expressed in or
implied by such forward-looking statements. The company's consolidated
results and the forward-looking statements could be affected by many
factors, including but not limited to: the loss of our relationship with
the U.S. government or a shift in U.S. government funding; potential
changes in U.S. government or customer priorities and requirements
(including potential deferrals of awards, terminations, reductions of
expenditures, changes to respond to the priorities of Congress and the
Administration, budgetary constraints, debt ceiling implications,
sequestration and cost-cutting initiatives); risks inherent with large
long-term fixed-price contracts, particularly the ability to contain
cost overruns; the potential impact of a security breach, through cyber
attack or otherwise, or other significant disruptions of our IT networks
and systems or those we operate for customers; financial and government
and regulatory risks relating to international sales and operations; the
continued effects of the general downturn and weakness in the global
economy and U.S. government’s budget deficits and national debt and
potential sequestration; our ability to continue to develop new products
that achieve market acceptance; the consequences of future geo-political
events; strategic acquisitions and the risks and uncertainties related
thereto, including our ability to manage and integrate acquired
businesses; performance of our subcontractors and suppliers; potential
claims that we are infringing the intellectual property rights of third
parties; the successful resolution of patent infringement claims and the
ultimate outcome of other contingencies, litigation and legal matters;
risks inherent in developing new technologies; changes in our effective
tax rate; the potential impact of natural disasters or other disruptions
on our operations; the potential impact of changes in the regulatory
framework that applies to, or of satellite bandwidth constraints on, our
managed satellite and terrestrial communications solutions; the timing
and impact of anticipated dispositions of the company’s Cyber Integrated
Solutions operation and Broadcast Communications business; the timing
and amount of anticipated gains, losses, impairments and charges related
to such dispositions; and changes in future business or other market
conditions that could cause business investments and/or recorded
goodwill or other long-term assets to become impaired. Further
information relating to factors that may impact the company's results
and forward-looking statements are disclosed in the company's filings
with the SEC. The forward-looking statements contained in this release
are made as of the date of this release, and the company disclaims any
intention or obligation, other than imposed by law, to update or revise
any forward-looking statements, whether as a result of new information,
future events, or otherwise.
|
|
| Table 1 |
| HARRIS CORPORATION |
| FY '13 Second Quarter Summary |
| CONDENSED CONSOLIDATED STATEMENT OF INCOME |
| (Unaudited) |
|
|
| | |
|
| | |
|
| | |
|
| | |
| | | Quarter Ended |
| | Two Quarters Ended |
| | | December 28, | | | December 30, | | | December 28, | | | December 30, |
| | | 2012 | | | 2011 | | | 2012 | | | 2011 |
| | | | | | | | | | | | | | | |
|
| | | (In millions, except per share amounts) |
|
Revenue from product sales and services
| | |
$
|
1,286.9
| | | |
$
|
1,310.2
| | | |
$
|
2,548.4
| | | |
$
|
2,646.3
| |
| | | | | | | | | | | | | | | |
|
|
Cost of product sales and services
| | | |
(845.4
|
)
| | | |
(856.0
|
)
| | | |
(1,693.7
|
)
| | | |
(1,749.9
|
)
|
|
Engineering, selling and administrative expenses
| | | |
(213.1
|
)
| | | |
(222.3
|
)
| | | |
(411.3
|
)
| | | |
(445.7
|
)
|
|
Non-operating income (loss)
| | | |
(1.1
|
)
| | | |
2.9
| | | | |
(1.1
|
)
| | | |
3.6
| |
|
Interest income
| | | |
0.5
| | | | |
0.2
| | | | |
1.0
| | | | |
1.1
| |
|
Interest expense
| | |
|
(27.6
|
)
| | | |
(29.1
|
)
| | |
|
(55.5
|
)
| | |
|
(57.2
|
)
|
| | | | | | | | | | | | | | | |
|
|
Income from continuing operations before income taxes
| | | |
200.2
| | | | |
205.9
| | | | |
387.8
| | | | |
398.2
| |
|
Income taxes
| | |
|
(61.7
|
)
| | | |
(71.1
|
)
| | |
|
(121.0
|
)
| | |
|
(132.8
|
)
|
|
Income from continuing operations
| | | |
138.5
| | | | |
134.8
| | | | |
266.8
| | | | |
265.4
| |
|
Discontinued operations, net of income taxes
| | |
|
(93.7
|
)
| | | |
(2.5
|
)
| | |
|
(308.0
|
)
| | |
|
(12.0
|
)
|
|
Net income (loss)
| | | |
44.8
| | | | |
132.3
| | | | |
(41.2
|
)
| | | |
253.4
| |
|
Noncontrolling interests, net of income taxes
| | |
|
3.7
|
| | | |
0.8
|
| | |
|
3.9
|
| | |
|
1.3
|
|
|
Net income (loss) attributable to Harris Corporation
| | |
$
|
48.5
|
| | |
$
|
133.1
|
| | |
$
|
(37.3
|
)
| | |
$
|
254.7
|
|
| | | | | | | | | | | | | | | |
|
Net income (loss) per common share attributable to Harris
Corporation common shareholders | | | | | | | | | | | | | | | | |
|
Basic
| | | | | | | | | | | | | | | | |
|
Continuing operations
| | |
$
|
1.26
| | | |
$
|
1.19
| | | |
$
|
2.42
| | | |
$
|
2.27
| |
|
Discontinued operations
| | |
|
(0.83
|
)
| | |
|
(0.02
|
)
| | |
|
(2.75
|
)
| | |
|
(0.10
|
)
|
| | |
$
|
0.43
|
| | |
$
|
1.17
|
| | |
$
|
(0.33
|
)
| | |
$
|
2.17
|
|
| | | | | | | | | | | | | | | |
|
|
Diluted
| | | | | | | | | | | | | | | | |
|
Continuing operations
| | |
$
|
1.25
| | | |
$
|
1.18
| | | |
$
|
2.40
| | | |
$
|
2.26
| |
|
Discontinued operations
| | |
|
(0.82
|
)
| | |
|
(0.02
|
)
| | |
|
(2.73
|
)
| | |
|
(0.10
|
)
|
| | |
$
|
0.43
|
| | |
$
|
1.16
|
| | |
$
|
(0.33
|
)
| | |
$
|
2.16
|
|
| | | | | | | | | | | | | | | |
|
|
Cash dividends paid per common share
| | |
$
|
0.37
| | | |
$
|
0.28
| | | |
$
|
0.74
| | | |
$
|
0.56
| |
| | | | | | | | | | | | | | | |
|
|
Basic weighted average common shares outstanding
| | | |
112.3
| | | | |
112.4
| | | | |
112.1
| | | | |
116.1
| |
|
Diluted weighted average common shares outstanding
| | | |
112.9
| | | | |
112.8
| | | | |
112.7
| | | | |
116.5
| |
|
|
| Table 2 |
| HARRIS CORPORATION |
| FY '13 Second Quarter Summary |
| BUSINESS SEGMENT INFORMATION |
| (Unaudited) |
|
|
| | |
|
| | |
|
| | |
|
| | |
| | | Quarter Ended |
| | Two Quarters Ended |
| | | December 28, | | | December 30, | | | December 28, | | | December 30, |
| | | 2012 | | | 2011 | | | 2012 | | | 2011 |
| | | | | | | | | | | | | | | |
|
| | | (In millions) |
| Revenue | | | | | | | | | | | | | | | | |
|
RF Communications
| | |
$
|
486.0
| | | |
$
|
525.7
| | | |
$
|
930.7
| | | |
$
|
1,022.8
| |
|
Integrated Network Solutions
| | | |
396.3
| | | | |
385.4
| | | | |
772.0
| | | | |
804.0
| |
|
Government Communications Systems
| | | |
438.8
| | | | |
422.4
| | | | |
904.3
| | | | |
866.1
| |
|
Corporate eliminations
| | |
|
(34.2
|
)
| | |
|
(23.3
|
)
| | |
|
(58.6
|
)
| | |
|
(46.6
|
)
|
| | |
$
|
1,286.9
|
| | |
$
|
1,310.2
|
| | |
$
|
2,548.4
|
| | |
$
|
2,646.3
|
|
| Income From Continuing Operations Before Income Taxes | | | | | | | | | | | | | | | | |
| Segment Operating Income: | | | | | | | | | | | | | | | | |
|
RF Communications
| | |
$
|
151.0
| | | |
$
|
172.4
| | | |
$
|
285.1
| | | |
$
|
326.4
| |
|
Integrated Network Solutions
| | | |
32.4
| | | | |
19.5
| | | | |
64.8
| | | | |
41.3
| |
|
Government Communications Systems
| | | |
65.5
| | | | |
62.9
| | | | |
132.6
| | | | |
126.0
| |
|
Unallocated corporate expense
| | | |
(17.7
|
)
| | | |
(22.0
|
)
| | | |
(34.4
|
)
| | | |
(40.6
|
)
|
|
Corporate eliminations
| | | |
(2.8
|
)
| | | |
(0.9
|
)
| | | |
(4.7
|
)
| | | |
(2.4
|
)
|
|
Non-operating income (loss)
| | | |
(1.1
|
)
| | | |
2.9
| | | | |
(1.1
|
)
| | | |
3.6
| |
|
Net interest expense
| | |
|
(27.1
|
)
| | |
|
(28.9
|
)
| | |
|
(54.5
|
)
| | |
|
(56.1
|
)
|
| | |
$
|
200.2
|
| | |
$
|
205.9
|
| | |
$
|
387.8
|
| | |
$
|
398.2
|
|
|
|
| Table 3 |
| HARRIS CORPORATION |
| FY '13 Second Quarter Summary |
| CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS |
| (Unaudited) |
|
|
| | |
|
| | |
| | | Two Quarters Ended |
| | | December 28, | | | December 30, |
| | | 2012 | | | 2011 |
| | | | | | | |
|
| | | (In millions) |
| Operating Activities | | | | | | | | |
|
Net income (loss)
| | |
$
|
(41.2
|
)
| | |
$
|
253.4
| |
|
Adjustments to reconcile net income (loss) to net cash provided by
operating activities:
| | | | | | | | |
|
Depreciation and amortization
| | | |
110.2
| | | | |
129.3
| |
|
Share-based compensation
| | | |
15.0
| | | | |
16.6
| |
|
Non-current deferred income taxes
| | | |
0.2
| | | | |
(3.4
|
)
|
|
Gain on the sale of securities available-for-sale
| | | |
(9.0
|
)
| | | |
―
|
|
Impairment of assets of discontinued operations
| | | |
320.7
| | | | |
―
|
|
(Increase) decrease in:
| | | | | | | | |
|
Accounts and notes receivable
| | | |
57.6
| | | | |
(21.7
|
)
|
|
Inventories
| | | |
(9.9
|
)
| | | |
21.5
| |
|
Increase (decrease) in:
| | | | | | | | |
|
Accounts payable and accrued expenses
| | | |
(151.0
|
)
| | | |
(169.4
|
)
|
|
Advance payments and unearned income
| | | |
39.8
| | | | |
43.0
| |
|
Income taxes
| | | |
(49.1
|
)
| | | |
7.3
| |
|
Other
| | |
|
(3.8
|
)
| | |
|
1.4
|
|
|
Net cash provided by operating activities
| | |
|
279.5
|
| | |
|
278.0
|
|
| | | | | | | |
|
| Investing Activities | | | | | | | | |
|
Net cash paid for acquired businesses
| | | |
―
| | | |
(14.0
|
)
|
|
Cash paid for cost-method investment
| | | |
(0.8
|
)
| | | |
―
|
|
Additions of property, plant and equipment
| | | |
(79.9
|
)
| | | |
(111.3
|
)
|
|
Additions of capitalized software
| | | |
(2.8
|
)
| | | |
(11.2
|
)
|
|
Proceeds from the sale of securities available-for-sale
| | |
|
11.9
|
| | |
|
―
|
|
Net cash used in investing activities
| | |
|
(71.6
|
)
| | |
|
(136.5
|
)
|
| | | | | | | |
|
| Financing Activities | | | | | | | | |
|
Proceeds from borrowings
| | | |
10.4
| | | | |
364.9
| |
|
Repayments of borrowings
| | | |
(129.4
|
)
| | | |
(3.7
|
)
|
|
Proceeds from exercises of employee stock options
| | | |
78.4
| | | | |
6.2
| |
|
Repurchases of common stock
| | | |
(114.2
|
)
| | | |
(423.2
|
)
|
|
Cash dividends
| | |
|
(84.0
|
)
| | |
|
(64.5
|
)
|
|
Net cash used in financing activities
| | |
|
(238.8
|
)
| | |
|
(120.3
|
)
|
| | | | | | | |
|
|
Effect of exchange rate changes on cash and cash equivalents
| | |
|
3.0
|
| | |
|
(1.1
|
)
|
| | | | | | | |
|
| Net increase (decrease) in cash and cash equivalents | | | |
(27.9
|
)
| | | |
20.1
| |
| | | | | | | |
|
| Cash and cash equivalents, beginning of year | | |
|
356.0
|
| | |
|
366.9
|
|
| | | | | | | |
|
| Cash and cash equivalents, end of quarter | | |
$
|
328.1
|
| | |
$
|
387.0
|
|
|
|
| Table 4 |
| HARRIS CORPORATION |
| FY '13 Second Quarter Summary |
| CONDENSED CONSOLIDATED BALANCE SHEET |
| (Unaudited) |
|
|
| | |
|
| | |
| | | December 28, | | | June 29, |
| | | 2012 | | | 2012 |
| | | | | | | |
|
| | | (In millions) |
| Assets | | | | | | | | |
| | | | | | | |
|
|
Cash and cash equivalents
| | |
$
|
328.1
| | |
$
|
356.0
|
|
Receivables
| | | |
702.5
| | | |
750.2
|
|
Inventories
| | | |
624.5
| | | |
617.8
|
|
Income taxes receivable
| | | |
35.3
| | | |
12.0
|
|
Current deferred income taxes
| | | |
174.4
| | | |
160.5
|
|
Other current assets
| | | |
77.7
| | | |
71.2
|
|
Current assets of discontinued operations
| | | |
316.7
| | | |
632.7
|
|
Property, plant and equipment
| | | |
666.6
| | | |
659.4
|
|
Goodwill
| | | |
1,709.2
| | | |
1,695.3
|
|
Intangible assets
| | | |
380.3
| | | |
421.7
|
|
Non-current deferred income taxes
| | | |
81.9
| | | |
80.3
|
|
Other non-current assets
| | |
|
144.1
| | |
|
135.7
|
| | |
$
|
5,241.3
| | |
$
|
5,592.8
|
| Liabilities and Equity | | | | | | | | |
| | | | | | | |
|
|
Short-term debt
| | |
$
|
38.1
| | |
$
|
159.4
|
|
Accounts payable
| | | |
299.0
| | | |
381.0
|
|
Compensation and benefits
| | | |
189.5
| | | |
229.1
|
|
Other accrued items
| | | |
237.9
| | | |
269.6
|
|
Advance payments and unearned income
| | | |
265.2
| | | |
221.5
|
|
Income taxes payable
| | | |
―
| | | |
12.0
|
|
Current deferred income taxes
| | | |
2.0
| | | |
0.8
|
|
Current portion of long-term debt
| | | |
12.6
| | | |
4.8
|
|
Current liabilities of discontinued operations
| | | |
118.9
| | | |
136.2
|
|
Long-term debt
| | | |
1,879.2
| | | |
1,883.0
|
|
Long-term contract liability
| | | |
103.3
| | | |
109.5
|
|
Other long-term liabilities
| | | |
269.5
| | | |
239.8
|
|
Equity
| | |
|
1,826.1
| | |
|
1,946.1
|
| | |
$
|
5,241.3
| | |
$
|
5,592.8
|
| | | | | | | |
|
HARRIS CORPORATION
FY '13 Second Quarter Summary
RECONCILIATION
OF NON-GAAP FINANCIAL MEASURES AND REGULATION G DISCLOSURE
To supplement our condensed consolidated financial statements presented
in accordance with U.S. generally accepted accounting principles (GAAP),
we provide additional measures of segments’ operating income;
engineering, selling and administrative expenses; income from continuing
operations before income taxes; income taxes; income from continuing
operations; income from continuing operations attributable to Harris
Corporation; and income from continuing operations per diluted common
share attributable to Harris Corporation common shareholders, adjusted
to exclude certain costs, charges, expenses and losses. Harris
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. Harris management also believes that
these non-GAAP financial measures enhance the ability of investors to
analyze Harris’ business trends and to understand Harris’ performance.
In addition, Harris may utilize non-GAAP financial measures as a guide
in its forecasting, budgeting, and long-term planning process 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. A
reconciliation of these non-GAAP financial measures with the most
directly comparable financial measures calculated in accordance with
GAAP follows:
|
|
| Table 5 |
| HARRIS CORPORATION |
| FY '13 Second Quarter Summary |
| RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
| Condensed Consolidated Statement of Income |
| (Unaudited) |
|
|
| | |
| | |
| | |
| | |
| | |
| | |
| | | Quarter Ended | | Quarter Ended |
| | | December 28, 2012 | | December 30, 2011 |
| | | As Reported | | Adjustment | | Non-GAAP | | As Reported | | Adjustment | | Non-GAAP |
| | | | | | | | | | | | | | | | | | |
|
| | | (In millions, except per share amounts) |
|
Revenue from product sales and services
| | |
$
|
1,286.9
| | |
$
|
―
| |
$
|
1,286.9
| | |
$
|
1,310.2
| | |
$
|
―
| |
$
|
1,310.2
| |
| | | | | | | | | | | | | | | | | | |
|
|
Cost of product sales and services
| | | |
(845.4
|
)
| | |
―
| | |
(845.4
|
)
| | |
(856.0
|
)
| | |
―
| | |
(856.0
|
)
|
Engineering, selling and administrative expenses (A)
| | | | | | | | | | | | | | | | | | | |
| | |
(213.1
|
)
| | |
―
| | |
(213.1
|
)
| | |
(222.3
|
)
| | |
9.7
| | | |
(212.6
|
)
|
|
Non-operating income (loss)
| | | |
(1.1
|
)
| | |
―
| | |
(1.1
|
)
| | |
2.9
| | | |
―
| | |
2.9
| |
|
Interest income
| | | |
0.5
| | | |
―
| | |
0.5
| | | |
0.2
| | | |
―
| | |
0.2
| |
|
Interest expense
| | |
|
(27.6
|
)
| |
|
―
| |
|
(27.6
|
)
| |
|
(29.1
|
)
| |
|
―
| |
|
(29.1
|
)
|
| | | | | | | | | | | | | | | | | | |
|
Income from continuing operations before income taxes
| | | | | | | | | | | | | | | | | | | |
| | |
200.2
| | | |
―
| | |
200.2
| | | |
205.9
| | | |
9.7
| | | |
215.6
| |
|
Income taxes (B)
| | |
|
(61.7
|
)
| |
|
―
| |
|
(61.7
|
)
| |
|
(71.1
|
)
| |
|
(3.1
|
)
| |
|
(74.2
|
)
|
|
Income from continuing operations
| | | |
138.5
| | | |
―
| | |
138.5
| | | |
134.8
| | | |
6.6
| | | |
141.4
| |
|
Noncontrolling interests, net of income taxes
| | | |
3.7
| | | |
―
| | |
3.7
| | | |
0.8
| | | |
―
| | |
0.8
| |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Income from continuing operations attributable to Harris
Corporation
| | |
$
|
142.2
|
| |
$
|
―
| |
$
|
142.2
|
| |
$
|
135.6
|
| |
$
|
6.6
|
| |
$
|
142.2
|
|
| | | | | | | | | | | | | | | | | | |
|
|
Income from continuing operations per diluted common share
attributable to Harris Corporation common shareholders
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
|
| |
$
|
1.25
| | |
$
|
―
| |
$
|
1.25
| | |
$
|
1.18
| | |
$
|
0.06
| | |
$
|
1.24
| |
| | | | | | | | | | | | | | | | | | |
|
| | | | | | | | | | | | | | | | | | |
|
| | | Two Quarters Ended | | Two Quarters Ended |
| | | December 28, 2012 | | December 30, 2011 |
| | | As Reported | | Adjustment | | Non-GAAP | | As Reported | | Adjustment | | Non-GAAP |
| | | | | | | | | | | | | | | | | | |
|
| | | (In millions, except per share amounts) |
|
Revenue from product sales and services
| | |
$
|
2,548.4
| | |
$
|
―
| |
$
|
2,548.4
| | |
$
|
2,646.3
| | |
$
|
―
| |
$
|
2,646.3
| |
| | | | | | | | | | | | | | | | | | |
|
|
Cost of product sales and services
| | | |
(1,693.7
|
)
| | |
―
| | |
(1,693.7
|
)
| | |
(1,749.9
|
)
| | |
―
| | |
(1,749.9
|
)
|
|
Engineering, selling and administrative expenses (A)
| | | | | | | | | | | | | | | | | | | |
| | |
(411.3
|
)
| | |
―
| | |
(411.3
|
)
| | |
(445.7
|
)
| | |
19.3
| | | |
(426.4
|
)
|
|
Non-operating income (loss)
| | | |
(1.1
|
)
| | |
―
| | |
(1.1
|
)
| | |
3.6
| | | |
―
| | |
3.6
| |
|
Interest income
| | | |
1.0
| | | |
―
| | |
1.0
| | | |
1.1
| | | |
―
| | |
1.1
| |
|
Interest expense
| | |
|
(55.5
|
)
| |
|
―
| |
|
(55.5
|
)
| |
|
(57.2
|
)
| |
|
―
| |
|
(57.2
|
)
|
| | | | | | | | | | | | | | | | | | |
|
|
Income from continuing operations before income taxes
| | | | | | | | | | | | | | | | | | | |
| | |
387.8
| | | |
―
| | |
387.8
| | | |
398.2
| | | |
19.3
| | | |
417.5
| |
|
Income taxes (B)
| | |
|
(121.0
|
)
| |
|
―
| |
|
(121.0
|
)
| |
|
(132.8
|
)
| |
|
(5.7
|
)
| |
|
(138.5
|
)
|
|
Income from continuing operations
| | | |
266.8
| | | |
―
| | |
266.8
| | | |
265.4
| | | |
13.6
| | | |
279.0
| |
|
Noncontrolling interests, net of income taxes
| | | |
3.9
| | | |
―
| | |
3.9
| | | |
1.3
| | | |
―
| | |
1.3
| |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Income from continuing operations attributable to Harris
Corporation
| | |
$
|
270.7
|
| |
$
|
―
| |
$
|
270.7
|
| |
$
|
266.7
|
| |
$
|
13.6
|
| |
$
|
280.3
|
|
| | | | | | | | | | | | | | | | | | |
|
|
Income from continuing operations per diluted common share
attributable to Harris Corporation common shareholders
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
|
| |
$
|
2.40
| | |
$
|
―
| |
$
|
2.40
| | |
$
|
2.26
| | |
$
|
0.11
| | |
$
|
2.37
| |
| Table 6 |
| HARRIS CORPORATION |
| FY '13 Second Quarter Summary |
| RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
| Business Segment Information |
| (Unaudited) |
|
|
| | |
| | |
| | |
| | |
| | |
| | |
| | | Quarter Ended | | Quarter Ended |
| | | December 28, 2012 | | December 30, 2011 |
| | | As Reported | | Adjustment | | Non-GAAP | | As Reported | | Adjustment | | Non-GAAP |
| | | | | | | | | | | | | | | | | | |
|
| | | (In millions) |
| Revenue | | | | | | | | | | | | | | | | | | | |
|
RF Communications
| | |
$
|
486.0
| | |
$
|
―
| |
$
|
486.0
| | |
$
|
525.7
| | |
$
|
―
| |
$
|
525.7
| |
|
Integrated Network Solutions
| | | |
396.3
| | | |
―
| | |
396.3
| | | |
385.4
| | | |
―
| | |
385.4
| |
|
Government Communications Systems
| | | |
438.8
| | | |
―
| | |
438.8
| | | |
422.4
| | | |
―
| | |
422.4
| |
|
Corporate eliminations
| | |
|
(34.2
|
)
| |
|
―
| |
|
(34.2
|
)
| |
|
(23.3
|
)
| |
|
―
| |
|
(23.3
|
)
|
| | |
$
|
1,286.9
|
| |
$
|
―
| |
$
|
1,286.9
|
| |
$
|
1,310.2
|
| |
$
|
―
| |
$
|
1,310.2
|
|
Income From Continuing Operations Before Income Taxes | | | | | | | | | | | | | | | | | | | |
| Segment Operating Income: | | | | | | | | | | | | | | | | | | | |
|
RF Communications
| | |
$
|
151.0
| | |
$
|
―
| |
$
|
151.0
| | |
$
|
172.4
| | |
$
|
―
| |
$
|
172.4
| |
|
Integrated Network Solutions (C)
| | | |
32.4
| | | |
―
| | |
32.4
| | | |
19.5
| | | |
9.7
| | |
29.2
| |
|
Government Communications Systems
| | | |
65.5
| | | |
―
| | |
65.5
| | | |
62.9
| | | |
―
| | |
62.9
| |
|
Unallocated corporate expense
| | | |
(17.7
|
)
| | |
―
| | |
(17.7
|
)
| | |
(22.0
|
)
| | |
―
| | |
(22.0
|
)
|
|
Corporate eliminations
| | | |
(2.8
|
)
| | |
―
| | |
(2.8
|
)
| | |
(0.9
|
)
| | |
―
| | |
(0.9
|
)
|
|
Non-operating income (loss)
| | | |
(1.1
|
)
| | |
―
| | |
(1.1
|
)
| | |
2.9
| | | |
―
| | |
2.9
| |
|
Net interest expense
| | |
|
(27.1
|
)
| |
|
―
| |
|
(27.1
|
)
| |
|
(28.9
|
)
| |
|
―
| |
|
(28.9
|
)
|
| | |
$
|
200.2
|
| |
$
|
―
| |
$
|
200.2
|
| |
$
|
205.9
|
| |
$
|
9.7
| |
$
|
215.6
|
|
| | | | | | | | | | | | | | | | | | |
|
| | | | | | | | | | | | | | | | | | |
|
| | | Two Quarters Ended | | Two Quarters Ended |
| | | December 28, 2012 | | December 30, 2011 |
| | | As Reported | | Adjustment | | Non-GAAP | | As Reported | | Adjustment | | Non-GAAP |
| | | | | | | | | | | | | | | | | | |
|
| | | (In millions) |
| Revenue | | | | | | | | | | | | | | | | | | | |
|
RF Communications
| | |
$
|
930.7
| | |
$
|
―
| |
$
|
930.7
| | |
$
|
1,022.8
| | |
$
|
―
| |
$
|
1,022.8
| |
|
Integrated Network Solutions
| | | |
772.0
| | | |
―
| | |
772.0
| | | |
804.0
| | | |
―
| | |
804.0
| |
|
Government Communications Systems
| | | |
904.3
| | | |
―
| | |
904.3
| | | |
866.1
| | | |
―
| | |
866.1
| |
|
Corporate eliminations
| | |
|
(58.6
|
)
| |
|
―
| |
|
(58.6
|
)
| |
|
(46.6
|
)
| |
|
―
| |
|
(46.6
|
)
|
| | |
$
|
2,548.4
|
| |
$
|
―
| |
$
|
2,548.4
|
| |
$
|
2,646.3
|
| |
$
|
―
| |
$
|
2,646.3
|
|
Income From Continuing Operations Before Income Taxes | | | | | | | | | | | | | | | | | | | |
| Segment Operating Income: | | | | | | | | | | | | | | | | | | | |
|
RF Communications
| | |
$
|
285.1
| | |
$
|
―
| |
$
|
285.1
| | |
$
|
326.4
| | |
$
|
―
| |
$
|
326.4
| |
|
Integrated Network Solutions (C)
| | | |
64.8
| | | |
―
| | |
64.8
| | | |
41.3
| | | |
19.3
| | |
60.6
| |
|
Government Communications Systems
| | | |
132.6
| | | |
―
| | |
132.6
| | | |
126.0
| | | |
―
| | |
126.0
| |
|
Unallocated corporate expense
| | | |
(34.4
|
)
| | |
―
| | |
(34.4
|
)
| | |
(40.6
|
)
| | |
―
| | |
(40.6
|
)
|
|
Corporate eliminations
| | | |
(4.7
|
)
| | |
―
| | |
(4.7
|
)
| | |
(2.4
|
)
| | |
―
| | |
(2.4
|
)
|
|
Non-operating income (loss)
| | | |
(1.1
|
)
| | |
―
| | |
(1.1
|
)
| | |
3.6
| | | |
―
| | |
3.6
| |
|
Net interest expense
| | |
|
(54.5
|
)
| |
|
―
| |
|
(54.5
|
)
| |
|
(56.1
|
)
| |
|
―
| |
|
(56.1
|
)
|
| | |
$
|
387.8
|
| |
$
|
―
| |
$
|
387.8
|
| |
$
|
398.2
|
| |
$
|
19.3
| |
$
|
417.5
|
|
| | | | | | | | | | | | | | | | | | | | | | |
|
HARRIS CORPORATION
FY '13 Second Quarter Summary
RECONCILIATION
OF GAAP TO NON-GAAP FINANCIAL MEASURES
(Unaudited)
Notes to tables 5 and 6:
Note A – Adjustments to engineering, selling and administrative
expenses for the quarter ended December 30, 2011 are due to integration
and other costs associated with our acquisitions of CapRock
Communications (“CapRock”) and the Global Connectivity Services business
of the Schlumberger group (“Schlumberger GCS”) ($9.7 million combined).
Adjustments to engineering, selling and administrative expenses for the
two quarters ended December 30, 2011 are due to integration and other
costs associated with our acquisitions of CapRock, Schlumberger GCS
($17.0 million combined) and Carefx Corporation (“Carefx”) ($2.3
million).
Note B – Adjustments to our income taxes are based on the
applicable tax rate in the jurisdiction to which the item applies.
Note C – Adjustments to our Integrated Network Solutions segment
operating income for the quarter ended December 30, 2011 are due to
integration and other costs associated with our acquisitions of CapRock
and Schlumberger GCS ($9.7 million combined). Adjustments to our
Integrated Network Solutions segment operating income for the two
quarters ended December 30, 2011 are due to integration and other costs
associated with our acquisitions of CapRock, Schlumberger GCS ($17.0
million combined) and Carefx ($2.3 million).
Contacts:
Harris Corporation
Investor Relations inquiries:
Pamela
Padgett, 321-727-9383
pamela.padgett@harris.com
or
Media
inquiries:
Jim Burke, 321-727-9131
jim.burke@harris.com
or
For
additional information, contact Harris Corporation at webmaster@harris.com
Source: Harris Corporation