L3harris Technologies, Inc. · NYSE:LHX
L3harris Technologies — Harris — Q1 FY2018 Earnings Presentation
12 slides from L3harris Technologies's earnings presentation, January 2018
Slide 1: Fiscal 2018 First Quarter Earnings Call Presentation
Place image here (13.33” x 3.5”) FISCAL 2018 FIRST 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: 1Q18: Good progress against strategic priorities
1Q18: Good progress against strategic priorities • ~Flat revenue; grew in 2 of 3 segments 1 Grow revenue across • Orders up 33% to record $2.3B; 1.6 B:B all 3 segments • Built backlog across segments Drive flawless execution • Delivered 8%* EPS growth 2 while maintaining • Expanded margin 70 bps* to
Slide 4: Key wins
Key wins = 1Q18 B:B 2.0 1.5 1.4 Communication Systems Electronic Systems Space and Intelligence Systems • $260M from Australia – moving from • Continued EW upgrades across • Continued strength in Classified radio supplier to systems integrator legacy platforms programs – leveraging investments ̶ $13
Slide 5: Solid 1Q18 financial results
Solid 1Q18 financial results ($million, except per share amounts) Revenue EPS 1,420 1,413 GAAP 1.16 • Revenue about flat 1.38 ~flat Non-GAAP 1.28 + 8% − Growth in ES and SIS offset by CS − Strong orders across all segments • EPS increased 8%* to $1.38 1Q17 1Q18 1Q17 1Q18 − Solid growth in Avionics,
Slide 6: 1Q18 EPS bridge
1Q18 EPS bridge $1.38 $1.28 $0.12 $0.01 $0.08 $0.05 Net interest Avionics, Battle mgmt., Classified space Exelis amortization − Environmental, − Taxes CS volume Pension income Integration savings Operational efficiencies 1Q17 ADS-B transition Share… Share Other Segments 1Q18 (non-GAAP) (
Slide 7: Communication Systems
Communication Systems ($million) Revenue • Revenue down 5% 430 410 - 5% − Tactical Comms revenue down 5% − DoD down slightly due to lower Airborne radios − Int’l down mid-single digits, Middle East and Africa growth offset by lower Central Asia and CALA 1Q17 1Q18 − Public Safety and Night Vision bot
Slide 8: Electronic Systems
Electronic Systems ($million) Revenue 537 540 + 1% • Revenue up 1%; despite $21M ADS-B impact − Solid Avionics growth – F-35, F-22, F/A-18 − UAE battle management system ramp − EW remained strong 1Q17 1Q18 Operating income and margin • Operating income down 2%; margin contracted 50 bps 111 109 - 2%
Slide 9: Space & Intelligence Systems
Space & Intelligence Systems ($million) Revenue 453 466 + 3% • Revenue up 3% − Classified up 8%; continued strong demand, including Space Superiority − Environmental programs down double digits as expected 1Q17 1Q18 • Operating income up 10%; margin Operating income and margin expanded 130 bps 87 79
Slide 10: FY18 guidance summary – reiterated
FY18 guidance summary – reiterated Total Harris By Segment Revenue Operating margin Revenue Operating Margin $1.81 - 1.84B CS 29.5 - 30.5% $6.02 - 6.14B up 3 - 5% 19.0 - 19.5% up 2 - 4% $2.32 - 2.36B 19.0 - 20.0% ES EPS FCF up 3 - 5% $5.85 - $6.05 $1.90 - 1.92B $850 - 900M S&IS 16.5 - 17.5% up 6 - 9
Slide 11: Other information (with FY17 and 1Q18 results comparison)
Other information (with FY17 and 1Q18 results comparison) ($million except noted) Reiterated FY17 1Q18 FY18 Amortization of Exelis acquisition intangibles $110 $25 ~$103 CHQ costs $56 $16 $55 - 60 non-GAAP FAS Pension expense/(income)* ($90) ($30) ~($120) Net capital expenditures $119 $23 ~$130 Net
Slide 12: Supplemental information - tactical communications history
Supplemental information - tactical communications history ($million) YTD 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 FY15 FY16 FY17 FY18 Orders 404 238 290 237 369 301 279 293 681 1,169 1,242 681 Sales 340 346 335 276 311 276 328 306 296 1,297 1,221 296 DoD 117 91 99 98 113 102 82 95 110 405