Slide 1: Fiscal 2017 Third Quarter Earnings Call Presentation
Place image here (10” x 3.5”) FISCAL 2017 THIRD QUARTER EARNINGS CALL PRESENTATION HARRIS.COM | #HARRISCORP
Slide 2: Forward-looking statements
Forward-looking statements Statements in this presentation 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 on the safe harbor pro
Slide 3: Strategic update
Strategic update • Focusing the portfolio; completed sale of IT services − 5th sale in 4 years; shaped company around core franchises where technology differentiates • Balanced and shareholder-friendly capital deployment − Divestiture proceeds and FCF generated ~$1.5B YTD − On track for about $700M
Slide 4: 3Q17 and year-to-date summary
3Q17 and year-to-date summary ($million, except per share amounts) EPS GAAP 1.26 1.31 3.74 3.77 Non-GAAP 1.35 1.38 3.85 4.04 • CapRock and IT services reported as + 2% + 5% discontinued operations; reporting now in 3 segments • Non-GAAP EPS $1.38; up 2%; up 5% YTD 3Q16 3Q17 YTD 16 YTD 17 Organic rev
Slide 5: Communication Systems
Communication Systems ($million) Revenue • Q3 segment revenue down 5%; YTD 1,428 1,304 down 9% 485 461 310 - 9% Public 109 - 5% 298 • Tactical Comms Q3 revenue down 5% Safety 104 − HRS legacy tactical up 1%; international Tactical 1118 up 8% 376 357 1006 Comms − Europe shaping up for record year − $
Slide 6: Space and Intelligence Systems
Space and Intelligence Systems ($million) Revenue • Q3 segment revenue down 3%; YTD up 2% driven by strong classified partially 1,370 1,396 489 + 2% offset by program transitions 475 - 3% • Q3 segment operating income up 1%; YTD up 11% with margins expanding 130 bps – reflecting solid program perfor
Slide 7: Electronic Systems
Electronic Systems ($million) Organic revenue* • Q3 segment revenue ~flat; YTD up 3% 1,660 driven by UAE battlefield management 1,604 554 553 + 3% ramp and double-digit EW growth ~ flat • Q3 segment operating income up 4%; YTD up 12% with margins expanding 170 bps – reflecting solid program executio
Slide 8: Updated fiscal 2017 outlook
Updated fiscal 2017 outlook ($million, except per share amounts) Guidance Prior fiscal 17 Updated fiscal 17 $ EPS $ EPS Revenue $ 5,760 – 5,881 ~$ 5,870 GAAP EPS from continuing operations $ 5.21 – 5.41 $ 5.20 – 5.25 Acquisition-related and other charges ~35 ~$ 0.19 ~40 ~$ 0.30 Non-GAAP EPS from con
Slide 9: Updated fiscal 2017 segment outlook
Updated fiscal 2017 segment outlook ($million) Other information Revenue Segment operating margin Prior Updated Re-allocated Prior Updated FY16 FY17 FY17 FY16** FY17 FY17** GAAP non-GAAP Harris Corporation $ 5,932 * ~flat to down 2% down ~1% Communication Systems $ 1,863 down 7 to 9% down ~7% 28.0%
Slide 10: Historical non-GAAP financial summary
Historical non-GAAP financial summary FY16 FY17 1Q 2Q 3Q 4Q FY16 1Q 2Q 3Q Revenue Communication Systems 454 489 485 435 1,863 430 413 461 Space & Intelligence Systems 435 446 489 529 1,899 453 468 475 Electronic Systems* 514 536 554 569 2,173 537 570 553 Eliminations (2) 0 1 (2) (3) 0 (2) (0) Total*
Slide 11: Supplemental information – Harris legacy tactical
Supplemental information – Harris legacy tactical ($million) Harris legacy tactical history FY17 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 FY13 FY14 FY15 FY16 YTD Orders 288 263 286 402 378 215 251 199 358 280 232 1,336 1,129 1,238 1,044 870 Sales 276 317 356 366 296 314 302 217 293 254