Slide 1: 4Q 2023 Earnings Conference Call
4Q 2023 Earnings Conference Call January 23, 2024 © 2024 RTX Corporation. All rights reserved.
Slide 2: Forward-Looking Statements
Forward-Looking Statements Note: All results and expectations in the presentation reflect continuing operations unless otherwise noted. This presentation contains statements which, to the extent they are not statements of historical or present fact, constitute “forward-looking statements” under the
Slide 3: 2023 Highlights
2023 Highlights 2023 Adjusted sales* up 11% organically year-over-year with 18% adjusted segment operating profit* growth Commercial aftermarket sales up 23% and commercial OE sales up 20% $74.3B Adjusted sales* ✓ year-over-year Defense sales up 4% year-over-year, with 1.24 full year book-to-bill; r
Slide 4: 4Q 2023 Sales, EPS and Cash Flow
4Q 2023 Sales EPS Cash Flow from continuing operations GAAP Adjusted* GAAP Adjusted* 10% organic Up 2% Up 9% growth* $19.9B $19.8B $1.27 $1.29 $4.7B ($0.8B) $18.1B $18.1B $1.05 $3.9B $0.96 2022 2023 2022 2023 2022 2023 2022 2023 Cash Flow CapEx Free Cash from continuing operations 2022 2023 Flow* Ex
Slide 5: Collins Aerospace Segment Highlights
Collins Aerospace Segment Highlights 4Q 2023 ($ millions) Reported Adjusted* YOY Var.* Sales $7,120 $7,008 12% Operating Profit $1,126 $1,035 22% ROS 15.8% 14.8% 120 bps • Organic sales* up 12% • Adjusted sales* up 12% – Commercial aftermarket up 23% – Commercial OE up 17% – Military up 1% • Adjuste
Slide 6: Pratt & Whitney Segment Highlights
Pratt & Whitney Segment Highlights 4Q 2023 ($ millions) Reported Adjusted* YOY Var.* Sales $6,439 $6,439 14% Operating Profit $382 $405 26% ROS 5.9% 6.3% 60 bps • Organic sales* up 14% • Adjusted sales* up 14% – Commercial OE up 20% – Commercial aftermarket up 18% – Military up 4% Pratt & Whitney Ca
Slide 7: Raytheon Segment Highlights
Raytheon Segment Highlights 4Q 2023 ($ millions) Reported Adjusted* YOY Var.* Sales $6,886 $6,886 3% Operating Profit $604 $618 8% ROS 8.8% 9.0% 40 bps • Organic sales* up 4% • Adjusted sales* up 3% – Higher volume on advanced technology and air power programs • Adjusted operating profit* up 8% – Hi
Slide 8: 2024 Environment
2024 Environment Positives Monitoring Challenges Commercial air traffic Supply chain / labor availability Inflation Commercial OE production rates Global tax environment GTF fleet support Global defense budgets Macro economic environment Non-operating pension income Cost reduction / pricing Continui
Slide 9: 2024 Outlook
2024 Outlook Full Year Outlook 2024 Adjusted EPS* Up 5% (mid-point) $0.72 ($0.36) ($0.16) $0.37 $5.25 - $5.40 $5.06 ($0.30) Sales $78.0B - $79.0B Segment range $0.65 - $0.79 FAS/CAS Adj. ~($0.20) 2024 Adj. ETR*: ~19.5% Non-Service 2023 Adj. ETR*: ~($0.16) 18.5% Organic sales growth %* 7% - 8% Adjust
Slide 10: 2024 Segment Outlook
2024 Segment Outlook ($ millions) Adjusted Sales Organic Sales Adjusted Operating VPY %* VPY %* Profit VPY* Collins Up mid to high-single Up mid to high-single Aerospace $650 - $725 digits digits Pratt & Whitney Up low double digits Up low double digits $400 - $475 Up low to mid-single Raytheon Down
Slide 11: Strong and Balanced A&D Portfolio
Strong and Balanced A&D Portfolio Collins Aerospace Pratt & Whitney Raytheon 20% ~$196B ~$78B 2023 commercial OE growth Backlog Defense backlog 23% 12% 1.28 2023 commercial aftermarket growth Backlog growth YoY 2023 book-to-bill Focused on execution to support our customers and drive shareholder val
Slide 12: Slide 12
Slide 13: Appendix
a Appendix Se RTX "
Slide 14: Use and Definitions of Non-GAAP Financial Measures
Use and Definitions of Non-GAAP Financial Measures RTX Corporation (“RTX” or “the Company”) reports its financial results in accordance with accounting principles generally accepted in the United States (“GAAP”). We supplement the reporting of our financial information determined under GAAP with cer
Slide 15: Additional 2024 Items
Additional 2024 Items FY 2024 Adjusted Tax Rate* ~19.5% Interest Expense ~$2,050M Corporate Expense and Other Unallocated Items ~$225M FAS/CAS Operating Adjustment ~$775M Non-Service Pension Income ~$1,500M Capex Spending ~$2.5 - $2.6B 14 *See Appendix for additional information regarding these non-
Slide 16: P&W Engine Shipments to Customers
RTX: P&W Engine Shipments to Customers 2022 2023 Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Military 60 62 49 48 219 42 74 55 35 206 Large Commercial1 119 177 192 224 712 167 191 261 256 875 Pratt & Whitney Canada2 455 459 509 542 1,965 499 507 500 557 2,063 1) Large commercial excludes industrial engine shipmen
Slide 17: Free Cash Flow Reconciliation
RTX: Free Cash Flow Reconciliation ($ millions) 4Q 2023 FY 2023 Net income from continuing operations 1,473 3,380 Depreciation & amortization 1,059 4,211 Change in working capital 2,048 1,515 Other 131 (1,223) Cash flow from operations 4,711 7,883 Capital expenditures (805) (2,415) Free cash flow 3,
Slide 18: 4Q 2023: RTX Sales Reconciliation
4Q 2023: RTX Sales Reconciliation Total Acquisitions FX / Reported Organic and Other Growth Divestitures Collins Aerospace 14% 12% - 2% Pratt & Whitney 14% 14% - - Raytheon 3% 4% (1%) - Elims & Other 15% 13% - 2% Total 10% 10% - - 17
Slide 19: 4Q 2023: RTX Restructuring Costs
4Q 2023: RTX Restructuring Costs ($ millions) 2023 2022 Restructuring impact to: Q1 2023 Q2 2023 Q3 2023 Q4 2023 FY 2023 Q1 2022 Q2 2022 Q3 2022 Q4 2022 FY 2022 Operating profit (loss) Collins Aerospace $ (3) $ (5) $ (64) $ 1 $ (71) $ (3) $ (2) $ (14) $ (2) $ (21) Pratt & Whitney (19) (25) (7) (23)
Slide 20: 2022 Reported to Adjusted
RTX: 2022 Reported to Adjusted ($ millions) Reported Restructuring & net significant and/or non-recurring items 1 Adjusted1 (Unaudited) (Unaudited) Net Sales Q1 2022 Q2 2022 Q3 2022 Q4 2022 FY 2022 Q1 2022 Q2 2022 Q3 2022 Q4 2022 FY 2022 Q1 2022 Q2 2022 Q3 2022 Q4 2022 FY 2022 Collins Aerospace $ 5,
Slide 21: 2023 Reported to Adjusted
RTX: 2023 Reported to Adjusted ($ millions) 20 1 For the full non-GAAP reconciliation of our segment sales and operating profit, refer to slides 21 - 23. For the full reconciliation of our non-operating results, net income and EPS refer to slide 25.
Slide 22: Reconciliation of GAAP to Adjusted: Collins Aerospace
RTX: Reconciliation of GAAP to Adjusted Collins Aerospace ($ millions) (Unaudited) (Unaudited) 2023 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 FY 2023 Q1 2022 Q2 2022 Q3 2022 Q4 2022 FY 2022 Collins Aerospace Net sales $ 6,120 $ 6,384 $ 6,629 $ 7,120 $ 26,253 $ 5,476 $ 5,627 $ 5,718 $ 6,231 $ 23,052 Custo
Slide 23: Reconciliation of GAAP to Adjusted: Pratt & Whitney
RTX: Reconciliation of GAAP to Adjusted Pratt & Whitney ($ millions) (Unaudited) (Unaudited) 2023 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 FY 2023 Q1 2022 Q2 2022 Q3 2022 Q4 2022 FY 2022 Pratt & Whitney Net sales $ 5,230 $ 5,701 $ 926 $ 6,439 $ 18,296 $ 4,529 $ 4,969 $ 5,380 $ 5,652 $ 20,530 Powder meta
Slide 24: Reconciliation of GAAP to Adjusted: Raytheon
RTX: Reconciliation of GAAP to Adjusted Raytheon ($ millions) (Unaudited) (Unaudited) 2023 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 FY 2023 Q1 2022 Q2 2022 Q3 2022 Q4 2022 FY 2022 Raytheon Net sales $ 6,292 $ 6,700 $ 6,472 $ 6,886 $ 26,350 $ 6,074 $ 6,133 $ 6,308 $ 6,661 $ 25,176 Adjusted net sales $ 6,
Slide 25: Reconciliation of GAAP to Adjusted: Non-Segment Operating Profit
RTX: Reconciliation of GAAP to Adjusted Non-Segment Operating Profit (Unaudited) (Unaudited) ($ millions) 2023 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 FY 2023 Q1 2022 Q2 2022 Q3 2022 Q4 2022 FY 2022 Eliminations and other Net sales $ (428) $ (470) $ (563) $ (518) $ (1,979) $ (363) $ (415) $ (455) $ (45
Slide 26: Reconciliation of GAAP to Adjusted: Consolidated Income and EPS
RTX: Reconciliation of GAAP to Adjusted Consolidated Income, Earnings Per Share (Unaudited) (Unaudited) ($ millions) 2023 2022 Income (Expense) Q1 2023 Q2 2023 Q3 2023 Q4 2023 FY 2023 Q1 2022 Q2 2022 Q3 2022 Q4 2022 FY 2022 Income (loss) from continuing operations attributable to common shareowners
Slide 27: Reconciliation of GAAP to Adjusted: Segment Operating Profit and Margin
RTX: Reconciliation of GAAP to Adjusted Segment Operating Profit (Loss) and Margin ($ millions) 26 1 Refer to slides 21 - 23 for individual operating profit adjustments.
Slide 28: Additional Pension Information
Additional Pension Information ($ millions) 2023 2024 Actual Projection Raytheon FAS/CAS operating adjustment $1,127 $775 RTX adjusted* non-service pension income $1,784 $1,500 RTX net cash $978 $700 27 *See Appendix for additional information regarding these non-GAAP financial measures.