Slide 1: Fourth Quarter and Full Year 2010 Earnings Call
Northrop Grumman Fourth Quarter and Full Year 2010 Earnings Call February 9, 2011 Wes Bush Chief Executive Officer and President Jim Palmer Corporate Vice President and Chief Financial Officer
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains “forward-looking” statements or projections based on our current expectations. Forward-looking statements are based on management’s assumptions and assessments in light of past experience and trends, current economic and industry conditions, expe
Slide 3: CEO Highlights
CEO Highlights • Strong 4Q and full year 2010 performance • 2010 diluted EPS from continuing operations of $6.77 • 3% sales growth • 24% increase in operating income • $3.1B cash provided by operations before discretionary pension contribution • $2.3B free cash flow before discretionary pension cont
Slide 4: 2011 Guidance
2011 Guidance Excluding Shipbuilding 2011 Guidance Excluding Shipbuilding Sales ~$27.5B* Segment operating margin %(1) Mid-10% Operating margin rate ~11% EPS from continuing operations $6.40 -- $6.60 Cash provided by continuing operations $ 2.3 -- $2.7B** Free cash flow from continuing operations(1)
Slide 5: 2011 Sector Guidance Summary
2011 Sector Guidance Summary Sector Sales OM Rate % Aerospace Systems Relatively stable ~11% Electronic Systems Relatively stable ~13% Low single digit Information Systems ~9% growth Technical Services ~$2.5B ~8% 5
Slide 6: 2010 To 2011 Guidance Bridge
2010 To 2011 Guidance Bridge Excluding Shipbuilding 2010 EPS from continuing operations $6.77 Estimated Shipbuilding contribution ~(0.50) Tax settlement (0.98) Costs related to the debt tender 0.49 2010 Adjusted EPS (1) $5.78 Change in net FAS/CAS pension 0.77 Lower interest expense 0.12 Tax rate (0
Slide 7: Appendix
NORTHROP GRUMMAN Appendix
Slide 8: Non-GAAP Financial Measures
Non-GAAP Financial Measures Non-GAAP Financial Measures Disclosure: Today’s press release contains non-GAAP (accounting principles generally accepted in the United States of America) financial measures, as defined by SEC (Securities and Exchange Commission) Regulation G and indicated by a footnote i
Slide 9: Non-GAAP Reconciliations
Non-GAAP Reconciliations Cash provided by continuing operations before discretionary pension contributions Fourth Quarter Total Year ($ millions) 2010 2009 2010 2009 Cash provided by continuing operations $ 1,387 $ 973 $ 2,453 $ 2,031 Discretionary pension pre-funding impact, net of tax 264 (141) 60