United Technologies 2012 Annual Report Download - page 74

72 UNITED TECHNOLOGIES CORPORATION
NOTE 4: EARNINGS PER SHARE
(DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS;
SHARES IN MILLIONS) 2012 2011 2010
Net income attributable to common
shareowners:
Net income from continuing operations $ 4,847 $ 4,831 $ 4,195
Net income from discontinued operations 283 148 178
Net income attributable to common
shareowners $ 5,130 $ 4,979 $ 4,373
Basic weighted average number of shares
outstanding 895.2 892.3 907.9
Stock awards 11.4 14.5 14.8
Diluted weighted average number of shares
outstanding 906.6 906.8 922.7
Earnings Per Share of Common Stock—
Basic:
Net income from continuing operations $ 5.41 $ 5.41 $ 4.62
Net income from discontinued operations 0.32 0.17 0.20
Net income attributable to common
shareowners 5.73 5.58 4.82
Earnings Per Share of Common Stock—
Diluted:
Net income from continuing operations $ 5.35 $ 5.33 $ 4.55
Net income from discontinued operations 0.31 0.16 0.19
Net income attributable to common
shareowners 5.66 5.49 4.74
The computation of diluted earnings per share excludes the
effect of the potential exercise of stock awards, including stock
appreciation rights and stock options when the average market
price of the common stock is lower than the exercise price of the
related stock awards during the period. These outstanding stock
awards are not included in the computation of diluted earnings per
share because the effect would have been anti-dilutive. For 2012,
there were 4.7 million anti-dilutive stock awards excluded from the
computation. For 2011, there were no anti-dilutive stock awards
excluded from the computation. For 2010, the number of stock
awards excluded from the computation was 11.4 million. There was
no impact on diluted earnings per share due to our equity unit offer-
ing in 2012.
NOTE 5: COMMERCIAL AEROSPACE INDUSTRY ASSETS AND
COMMITMENTS
We have receivables and other financing assets with commercial
aerospace industry customers totaling $5,731 million and $3,736
million at December 31, 2012 and 2011, respectively. Customer
financing assets related to commercial aerospace industry custom-
ers consist of products under lease of $644 million and notes and
leases receivable of $584 million.
Financing commitments, in the form of secured debt, guar-
antees or lease financing, are provided to commercial aerospace
customers. The extent to which the financing commitments will be
utilized is not currently known, since customers may be able to
obtain more favorable terms from other financing sources. We may
also arrange for third-party investors to assume a portion of these
commitments. If financing commitments are exercised, debt financ-
ing is generally secured by assets with fair market values equal to or
exceeding the financed amounts with interest rates established at
the time of funding. We may also lease aircraft and subsequently
sublease the aircraft to customers under long-term non-cancelable
operating leases. In some instances, customers may have minimum
lease terms that result in sublease periods shorter than our lease
obligation. Lastly, we have made residual value and other guaran-
tees related to various commercial aerospace customer financing
arrangements. The estimated fair market values of the guaranteed
assets equal or exceed the value of the related guarantees, net of
existing reserves.
We also have other contractual commitments, including
commitments to secure certain contractual rights to provide prod-
uct on new aircraft platforms. Payments made on these contractual
commitments are included within other intangible assets and are to
be amortized as the related OEM and aftermarket units are deliv-
ered over the estimated program life. Our commercial aerospace
financing and other contractual commitments as of December 31,
2012 were approximately $10.9 billion, which include approximately
$5.8 billion of IAE commitments. We have entered into certain col-
laboration arrangements, which may include participation by our
collaboration partners in these commitments.