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ANNUAL REPORT
2012

Table of contents

  • Page 1
    2012 ANNUAL REPORT

  • Page 2
    TEXTRON 2012 ANNUAL REPORT BILLION COMPAN Y TEXTRON IS KNOWN AROUND THE WORLD FOR ITS POWERFUL BRANDS OF AIRCRAFT, DEFENSE AND INDUSTRIAL PRODUCTS THAT PROVIDE CUSTOMERS WITH GROUNDBREAKING TECHNOLOGIES, INNOVATIVE ...

  • Page 3
    ...-capital KEY PERFORMANCE METRICS Net cash provided by operating activities of continuing operations for Manufacturing group-GAAP Manufacturing cash ï¬,ow before pension contributions-Non-GAAP1 1 2012 2011 $ 12,237 $ 1,132 581 11,275 591 242 $ 29.18 $ 18.37 24.12 1.97 28.87 14.66 18.49 0.79 294...

  • Page 4
    OUR FOCUS ON PRODUCT INNOVATION AND GLOBAL EXPANSION DROVE SOLID GAINS IN SALES AND PROFITS FOR THE YEAR. Textron Revenues by Segment BELL TEXTRON SYSTEMS CESSNA INDUSTRIAL FINANCE $4,274 / 35% $1,737 / 14% $3,111 / 25% $2,900 / 24% $215 / 2% TOTAL: $12,237 / 100% (dollars in millions) 2

  • Page 5
    ...billion, nearly doubling compared to 2011. In concert with the strong performance of our businesses, Textron's share price increased-rising 30 percent during 2012- far outpacing the S&P 500 Index and most of our peer companies. Much of this progress stemmed from investments we made to bring numerous...

  • Page 6
    ...development and expansion of our global training and service centers. Building upon last year's strong bookings, Bell's commercial business was up sharply in 2012; we delivered 188 aircraft this year compared to 125 for 2011. Across the entire commercial line, innovation was a driving force. At the...

  • Page 7
    ... Marine & Land Systems was also T selected to build an additional 200 Mobile Strike Force Vehicles for the Afghan National Army-bringing orders in 2012 to a total of 499-with deliveries scheduled into 2013. Along with multiple contract wins, we also continued to expand our product lines through...

  • Page 8
    ... remains on an upward trajectory-with revenues increasing by $121 million in 2012 compared to last year and segment profit increasing by $22 million. ... jets, we announced new turbo prop and single-engine piston aircraft in 2012. The Grand Caravan EX builds on the legacy of the Grand Caravan ...

  • Page 9
    ... car canopy and lowers energy costs by up to 20 percent. For hunting enthusiasts, the company's Bad Boy Buggies brand launched four new products in 2012. The new Bad Boy Buggies Ambush® model lets the driver switch between silent electric power or the additional range offered by a gas engine. Also...

  • Page 10
    ... customers can obtain through their in-country banks. In fact, most of our Captive Finance loans are related to cross-border aircraft sales. In 2012, Captive Finance supported sales of 93 new aircraft for Cessna and Bell Helicopter. Of these loans, 87 percent were for customers outside the United...

  • Page 11
    LEADERSHIP TEAM BOARD OF DIRECTORS Scott C. Donnelly (1) Chairman, President and Chief Executive Officer, Textron Inc. Kathleen M. Bader (2,3) President and Chief Executive Officer (Retired), NatureWorks LLC R. Kerry Clark (3,4) Chairman and Chief Executive Officer (Retired), Cardinal Health, Inc...

  • Page 12
    ... obligations. This measure may not be comparable with similarly titled measures reported by other companies, as there is no definitive accounting standard...of Cash Flows to Manufacturing cash ï¬,ow before pension contributions is provided below: 2012 $ 958 $ (480) (345) 240 15 405 793 $ (In millions...

  • Page 13
    UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-K [ x ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 29, 2012 or ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ...

  • Page 14
    ...appears in Note 17 to the Consolidated Financial Statements on pages 80 through 81 of this Annual Report on Form 10-K. The following description of our business should be read in conjunction with...U.S. and in Canada, Mexico, the Caribbean, the Bahamas and Bermuda. 2 Textron Inc. Annual Report â- 2012

  • Page 15
    ...total revenues in 2012, 2011 and 2010, respectively. Revenues ...of business were as follows: (In millions) 2012 2011 2010 Military: V-22 Program Other Military Commercial...19% of Textron's revenues in 2012, 2011 and 2010, respectively. ... as follows: (In millions) 2012 2011 2010 Unmanned Aircraft Systems Land...

  • Page 16
    ...Revenues of Kautex accounted for approximately 15%, 16% and 16% of our total revenues in 2012, 2011 and 2010, respectively. Our automotive products have several major competitors worldwide, some of ...off-road and light transportation vehicles. Competition is based 4 Textron Inc. Annual Report â- 2012

  • Page 17
    ... had difficulty in accessing other sources of financing for the purchase of Textron-manufactured products. In 2012, 2011 and 2010, our Finance group paid our Manufacturing group $309 million, $284 million ... a discussion of the credit quality of this portfolio. Textron Inc. Annual Report â- 2012 5

  • Page 18
    ...839 1,844 192 37 2,912 $ 10,609 Approximately 56% of our total backlog at December 29, 2012 represents orders that are not expected to be filled in 2013. Orders from Cessna customers, which cover ... Statements on page 54 of this Annual Report on Form 10-K. 6 Textron Inc. Annual Report â- 2012

  • Page 19
    .... Some of these trademarks, trade names and service marks are used in this Annual Report on Form 10-K and other reports, including: Aeronautical Accessories; AAI; ACAlert; Aerosonde; AH-1Z; Ambush; Arc ... positions since joining General Electric in 1989. Textron Inc. Annual Report â- 2012 7

  • Page 20
    ...furnish it to, the Securities and Exchange Commission. Forward-Looking Information Certain statements in this Annual Report on Form 10-K and other oral and written statements made by us from time to ... launches or certifications of our new aircraft products; 8 Textron Inc. Annual Report â- 2012

  • Page 21
    ...U.S. Government defense spending may adversely affect our results of operations and financial condition. During 2012, we derived approximately 29% of our revenues from sales to a variety of U.S. ... limited to, liability for re-procurement costs in excess Textron Inc. Annual Report â- 2012 9

  • Page 22
    ... operations could be adversely affected. Cost overruns also may adversely affect our ability to sustain existing programs and obtain future contract awards. 10 Textron Inc. Annual Report â- 2012

  • Page 23
    ... these adverse effects may be greater in circumstances where we rely on only one or two subcontractors or suppliers for a particular raw material, Textron Inc. Annual Report â- 2012 11

  • Page 24
    ... agree to specific in-country purchases, manufacturing agreements or financial support arrangements, known as offsets, as a condition for a contract award. The contracts 12 Textron Inc. Annual Report â- 2012

  • Page 25
    ...-Frank Act and recently enacted Securities and Exchange Commission rules, we will be required to report on our use of "conflict minerals" originating from the Democratic Republic of Congo and surrounding..., trade names and trade secrets that are important to our Textron Inc. Annual Report â- 2012 13

  • Page 26
    ... future payment obligations and the rates of future cost growth. Additionally, as part of our annual evaluation of these plans, significant changes in our assumptions, due to changes in economic, legislative...our results of operations could be adversely affected. 14 Textron Inc. Annual Report â- 2012

  • Page 27
    ...in the settlement admitted any wrongdoing with respect to the allegations in the case. As previously reported in Textron's Annual Report on Form 10-K for the fiscal year ended December 31, 2011, on February 7, 2012, a lawsuit was filed in the United States Bankruptcy Court, Northern District of Ohio...

  • Page 28
    ... 29, 2012, there were approximately...reported on the New York Stock Exchange and the dividends paid per share are provided in the following table: 2012...2012 - November 3, 2012) Month 2 (November 4, 2012 - December 1, 2012) Month 3 (December 2, 2012 - December 29, 2012...fourth quarter of 2012, all remaining shares...

  • Page 29
    ....40 79.68 79.10 53.43 $ 2010 34.57 91.68 91.05 63.41 $ 2011 27.14 93.61 95.86 63.86 2012 $ 35.52 106.78 108.37 76.92 Textron Inc. Annual Report â- 2012 17

  • Page 30
    Item 6. Selected Financial Data (Dollars in millions, except per share amounts) 2012 2011 2010 2009 2008 Revenues Cessna Bell Textron Systems Industrial Finance Total revenues Segment profit...have an anti-dilutive effect on the loss from continuing operations. 18 Textron Inc. Annual Report â- 2012

  • Page 31
    ...the Segment Analysis section on pages 21 to 30. Revenues Revenues increased $962 million, 9%, in 2012, compared with 2011, as increases in the Bell, Cessna, Industrial and Finance segments were partially ...and Weapons and Sensors product lines of $28 million. Textron Inc. Annual Report â- 2012 19

  • Page 32
    ... severance costs. Selling and administrative expense decreased $15 million, 1%, to $1,168 million in 2012, compared with 2011. The decrease was largely driven by lower operating expenses of $56 million... on transfer of Golf Mortgage portfolio to held for sale. 20 Textron Inc. Annual Report â- 2012

  • Page 33
    ... Credit from January 1, 2012 to December 31, 2013. As a result, our income tax provision in the first quarter of 2013 will include a discrete tax benefit that will reduce the annual effective tax rate by approximately one percent. Segment Analysis We operate in, and report financial information for...

  • Page 34
    ...higher Citation jet revenues reflecting a change in mix of new jets sold during the period. During 2012, the portion of Cessna's revenues derived from aftermarket sales and services represented 25% of Cessna's... with 26% in the corresponding period of 2010. 22 Textron Inc. Annual Report â- 2012

  • Page 35
    ...to 2012 year-over-year segment profit change are provided below: (In millions) 2012 versus ...53 12 (43) 22 In 2012, Cessna's segment profit increased ... due to fewer order cancellations in 2012. Inflation, net of pricing, included...decreased $827 million, 44%, in 2012 and $1.0 billion, 35%, in 2011...

  • Page 36
    ...higher revenues related to the support of fielded aircraft. Bell delivered 39 V-22 aircraft in 2012, compared with 34 deliveries in 2011. $21 million increase in other military volume resulting ...commercial aircraft in 2011, compared with 131 aircraft in 2010. 24 Textron Inc. Annual Report â- 2012

  • Page 37
    ... (Dollars in millions) 2012 2011 2010 % Change 2012 2011 Revenues Operating expenses Segment profit Profit margin Backlog $ 1,737 1,605 132 8% $ 2,919 $ 1,872 1,731 141 8% $ 1,337 $ 1,979 1,749 230 12% $ 1,598 (7)% (7)% (6)% 118% (5)% (1)% (39)% (16)% Textron Inc. Annual Report â- 2012 25

  • Page 38
    ...contracts with separate U.S. Government customers for UAS fee-for-service activities. In the third quarter of 2012, we experienced start-up issues as we began deployment for the first of these contracts, the... related to the workforce reduction taken in 2011. 26 Textron Inc. Annual Report â- 2012

  • Page 39
    ...1% 10% 4% 4% 6% 11% 9% 10% 9% 25% Industrial Revenues and Operating Expenses Factors contributing to the 2012 year-over-year revenue change are provided below: (In millions) 2012 versus 2011 Volume Foreign exchange Other Total change $ $ 171 (80) 24 115 Textron Inc. Annual Report â- 2012 27

  • Page 40
    ... $ 31 (17) (1) 13 Segment profit for the Industrial segment increased $13 million, 6%, in 2012, compared with 2011, primarily due to the impact from higher volume as described above, partially offset by... of pricing Other Total change $ $ 31 34 (35) 10 40 28 Textron Inc. Annual Report â- 2012

  • Page 41
    ...over the next two years. Finance Revenues Finance segment revenues increased $112 million in 2012 compared with 2011, primarily attributable to the following factors 90 million increase related to ... reductions related to the exit of the non-captive business. Textron Inc. Annual Report â- 2012 29

  • Page 42
    ... Finance receivables held for sale in the non-captive portfolio totaled $140 million at the end of 2012, compared with $418 million at the end of 2011. Nonaccrual finance receivables decreased $178 million, ...will have sufficient cash to meet our future needs. 30 Textron Inc. Annual Report â- 2012

  • Page 43
    ... At December 29, 2012, there were no...December 29, 2012, the ...millions) 2012 2011 ...from operating activities in 2012 on $1.1 billion in... plans in 2012. Within working...million in 2012, 2011 and...in 2012,...in 2012, ... of 2012 and...fourth quarter of 2012, under a 2007...2012... (In millions) 2012 2011 2010 Dividends paid...

  • Page 44
    ... issuance of long term debt of $106 million, $430 million and $231 million, respectively. In 2012, the Finance group also made cash payments totaling $493 million to the Manufacturing group related to intergroup ...44 million in 2011, from $72 million in 2010. 32 Textron Inc. Annual Report â- 2012

  • Page 45
    ...Although cash is transferred between the two borrowing groups, there is no cash transaction reported in the consolidated cash flows at the time of the original financing. These ... - $ (3) (108) (28) $ 182 (179) 60 (8) 55 242 $ 383 (505) 30 (13) (105) 298 Textron Inc. Annual Report â- 2012 33

  • Page 46
    ...following table summarizes the known contractual obligations, as defined by reporting regulations, of our Manufacturing group as of December 29, 2012: Payments Due by Period (In millions) Total Less ... full recourse under customary contract termination clauses. 34 Textron Inc. Annual Report â- 2012

  • Page 47
    ... following table summarizes the known contractual obligations, as defined by reporting regulations, of our Finance group as of December 29, 2012: Payments Due by Period (In millions) Total Less than ... contract or (d) we are unable to meet contract milestones. Textron Inc. Annual Report â- 2012 35

  • Page 48
    ...included within segment profit for the three years ended December 29, 2012: (In millions) 2012 2011 2010 Gross favorable Gross unfavorable Net adjustments $ $ 88...to that excess. Based on our annual impairment reviews, the fair value of all of our reporting units exceeded their carrying values, and...

  • Page 49
    ... the Captive product line include industry valuation guides, age and physical condition of collateral, payment history and existence and financial strength of guarantors. Textron Inc. Annual Report â- 2012 37

  • Page 50
    ...subject to examination based upon our evaluation of the facts, circumstances and information available at the reporting date. For those tax positions for which it is more likely than not that a tax ... exchange agreements and foreign currency exchange contracts. 38 Textron Inc. Annual Report â- 2012

  • Page 51
    ...instruments using discounted cash flow analysis and indicative market pricing as reported by leading financial news and data providers. This sensitivity analysis is...678) $ 115 $ $ 36 (13) 23 $ 2,415 (2,467) $ (52) 2,266 (2,347) $ (81) $ $ $ 90 (24) 66 Textron Inc. Annual Report â- 2012 39

  • Page 52
    ... firm thereon are included in this Annual Report on Form 10-K on the pages indicated below: Page 41 42 44 45 46 47 48 Report of Management Reports of Independent Registered Public Accounting Firm... is included in the financial statements or notes thereto. 40 Textron Inc. Annual Report â- 2012

  • Page 53
    ...for the integrity and objectivity of the financial data presented in this Annual Report on Form 10-K. The Consolidated Financial Statements have been prepared in conformity...February 15, 2013 Frank T. Connor Executive Vice President and Chief Financial Officer Textron Inc. Annual Report â- 2012 41

  • Page 54
    ...reporting as of December 29, 2012...reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Report...reporting...reporting...reporting...reporting... reporting may...reporting as of December 29, 2012...29, 2012 and ...2012 of Textron Inc. and our report...

  • Page 55
    ... Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 15, 2013 expressed an unqualified opinion thereon. /s/ Ernst & Young LLP Boston, Massachusetts February 15, 2013 Textron Inc. Annual Report â- 2012 43

  • Page 56
    ... in the three-year period ended December 29, 2012 (In millions, except per share data) 2012 2011 2010 Revenues Manufacturing revenues Finance revenues Total revenues... 1.97 0.03 2.00 $ $ $ $ 0.87 - 0.87 0.79 - 0.79 $ $ $ $ 0.33 (0.02) 0.31 0.30 (0.02) 0.28 44 Textron Inc. Annual Report â- 2012

  • Page 57
    ... For each of the years in the three-year period ended December 29, 2012 (In millions) 2012 2011 2010 Net income Other comprehensive income (loss), net of tax: Pension ... (146) (1) 2 - 444 $ 242 (286) (20) (3) - (67) $ 86 (71) 4 (2) 74 91 $ $ $ Textron Inc. Annual Report â- 2012 45

  • Page 58
    Consolidated Balance Sheets (In millions, except share data) December 29, 2012 December 31, 2011 Assets Manufacturing group Cash and equivalents Accounts receivable, net Inventories Other...3,266 275 2,991 $ 13,033 35 1,081 3,257 (1,625) 2,748 3 2,745 $ 13,615 46 Textron Inc. Annual Report â- 2012

  • Page 59
    ...Dividends declared ($0.08 per share) Share-based compensation activity Purchases of common stock Balance at December 29, 2012 $ 35 $ 1,369 $ 2,973 86 (22) $ (230) $ (1,321) 5 $ 35...275) $ (1,770) $ See Notes to the Consolidated Financial Statements. Textron Inc. Annual Report â- 2012 47

  • Page 60
    ...Cash and equivalents at beginning of year Cash and equivalents at end of year See Notes to the Consolidated Financial Statements. 2012 $ 589 8 581 2010 86 (6) 92 - - 383 (3) 68 (76) - 171 97 32 (316) ... 231 (1,467 22) 6 (3,493) (1) (961) 1,892 931 $ $ $ 48 Textron Inc. Annual Report â- 2012

  • Page 61
    ...542 8 534 $ 2011 464 - 464 $ 2010 314 (6) 320 $ 2012 47 - 47 Finance Group 2011 $ (222) - (222) $ 2010 (228) - (228) 345 (240) 358 - - - - 102 97 ...) 655 - - - 129 39 2,305 (2,111) 231 (111) (300) - 383 30 - - (505) - (2,383) 2 (111) 144 33 $ $ $ $ $ $ Textron Inc. Annual Report â- 2012 49

  • Page 62
    ... and 2010, the gross favorable program profit adjustments totaled $88 million, $83 million and $98 million, respectively. For 2012, 2011 and 2010, the gross unfavorable program profit adjustments totaled $73 million, $29 million and $20 million, respectively. 50 Textron Inc. Annual Report â- 2012

  • Page 63
    ... or until maturity or payoff. Finance receivables held for investment are generally recorded at the amount of outstanding principal less allowance for losses. Textron Inc. Annual Report â- 2012 51

  • Page 64
    ... and are depreciated primarily using the straight-line method. We capitalize expenditures for improvements that increase asset values and extend useful lives. 52 Textron Inc. Annual Report â- 2012

  • Page 65
    ... effective as hedges) in OCI, net of deferred taxes. Changes in fair value of derivatives not qualifying as hedges are recorded in earnings. Textron Inc. Annual Report â- 2012 53

  • Page 66
    .... Income Taxes Deferred income tax balances reflect the effects of temporary differences between the financial reporting carrying amounts of assets and liabilities and their tax bases, as well as from net ...of $52 million that was recorded in Other losses, net. 54 Textron Inc. Annual Report â- 2012

  • Page 67
    ... this charge. Amortization expense totaled $40 million, $51 million and $52 million in 2012, 2011 and 2010, respectively. Amortization expense is estimated to be approximately $36 million,...149 million at December 29, 2012 and $192 million at December 31, 2011. Textron Inc. Annual Report â- 2012 55

  • Page 68
    ...from five to ten years with amortization periods from twenty to thirty years. As of December 29, 2012, loans in Golf Mortgage had an average balance of $7 million and a weighted-average contractual maturity ... balance. We resume the accrual of interest when the 56 Textron Inc. Annual Report â- 2012

  • Page 69
    ...receivables held for investment by delinquency aging category is summarized in the table below: December 29, 2012 31-60 61-90 Over Days Days 90 Days Past Due Past Due Past Due December ...significant interest income recognized on impaired loans in 2012 or 2011. Textron Inc. Annual Report â- 2012 57

  • Page 70
    ...2012...reported in this table specifically exclude $122 million and $208 million of leveraged leases at December 29, 2012... and December 31, 2011, respectively, in accordance with authoritative accounting standards. December 29, 2012...-offs Recoveries Balance at December 29, 2012 $ $ $ 123 15 (43)...

  • Page 71
    ...in other portions of the portfolio. We received proceeds of $109 million and $383 million in 2012 and 2011, respectively, from the sale of finance receivables held for sale and $207 million ... million and $414 million at the end of 2012 and 2011, respectively. Textron Inc. Annual Report â- 2012 59

  • Page 72
    ... plans Other Total Changes in our warranty and product maintenance contract liability are as follows: (In millions) 2012 $ 725 282 180 115 80 574 $ 1,956 729 282 198 169 80 494 $ 1,952 $...and currency translation adjustments. $ $ 263 189 (231) 21 242 60 Textron Inc. Annual Report â- 2012

  • Page 73
    ... value adjustments and unamortized discount Total Finance group debt * Notes amortize on a quarterly or semi-annual basis. $ $ $ - 318 210 350 250 350 250 242 250 81 2,301 (535)...million in 2012, $58 million in 2011 and $60 million in 2010 for these notes. Textron Inc. Annual Report â- 2012 61

  • Page 74
    ...all the notes repurchased in the fourth quarter of 2011 would have been convertible. At the end of 2012, the outstanding purchased call options gave us the right to acquire from the counterparties 16.4 million shares... the counterparties at $13.125 per share. 62 Textron Inc. Annual Report â- 2012

  • Page 75
    ... counterparties related to the amendment of the option and warrant transactions discussed above. At December 29, 2012, the capped calls covered an aggregate of 28.7 million shares of our common stock (the number...are not available or cost-effective to obtain. Textron Inc. Annual Report â- 2012 63

  • Page 76
    ..., 2012 2011... at December 29, 2012. At December 29, 2012 and December 31, ... as Level 2. At December 29, 2012 and December 31, 2011, we had... Operations were both insignificant in 2012 and 2011. Cash Flow Hedges...expenses. At December 29, 2012, we had a net deferred... were not material in 2012 and 2011. We do...

  • Page 77
    ... which sales have been transacted for similar properties. The gains on finance receivables held for sale during 2012 were primarily the result of the payoff of loans in amounts, and sale of loans at prices,... values of these finance receivables are sensitive to Textron Inc. Annual Report â- 2012 65

  • Page 78
    ...debt is determined using market observable data for similar transactions or Level 2 inputs. At December 29, 2012 and December 31, 2011, approximately 46% and 53%, respectively, of the fair value of term debt...' ability to make payments on a timely basis. 66 Textron Inc. Annual Report â- 2012

  • Page 79
    ...182 14,053 428 294,663 277,684 28,869 702 307,255 274,452 27,450 653 302,555 In 2012, 2011 and 2010, stock options to purchase 7 million, 5 million and 7 million shares, respectively, of common.... These securities could potentially dilute EPS in the future. Textron Inc. Annual Report â- 2012 67

  • Page 80
    ...income (loss) are presented below: (In millions) 2012 Pre-Tax Amount Tax (Expense) Benefit After-Tax Amount... comprehensive loss Balance at December 31, 2011 Current period other comprehensive income (loss) Balance at December 29, 2012 $ $ 82 (3) 79 2 81 $ (1,425) (286) (1,711) (146) $ (1,857) ...

  • Page 81
    ...2012 ... 1, 2011 Cash paid Balance at December 31, 2011 Cash paid Balance at December 29, 2012 Note 12. Share-Based Compensation $ $ 48 79 (3) - (67) 57 (42)...up to 80% of annual, long-term incentive and...the DIP in 2012, 2011 and... as follows: (In millions) 2012 2011 2010 Compensation expense Income tax...

  • Page 82
    ... 27.75 (16.03) (36.49) $ 27.98 $ 29.12 $ At December 29, 2012, our outstanding options had an aggregate intrinsic value of $12 million and a weighted-average remaining contractual life... grant). The 2012 activity for restricted stock units is provided below: 70 Textron Inc. Annual Report â- 2012

  • Page 83
    ...ERISA). Effective on January 1, 2010, the Textron Retirement Plan was closed to new participants, and employees hired after that date receive an additional 4% annual cash contribution to their Textron Savings Plan account based on their eligible compensation. Textron Inc. Annual Report â- 2012 71

  • Page 84
    .... Our defined contribution plans cost approximately $88 million, $85 million and $88 million in 2012, 2011 and 2010, respectively; these amounts include $21 million, $23 million and $25 million...Prior service cost (credit) $ $ 184 15 199 $ $ 7 (11) (4) 72 Textron Inc. Annual Report â- 2012

  • Page 85
    ...2012 2011 Postretirement Benefits Other than Pensions 2012...(In millions) Pension Benefits 2012 2011 Postretirement Benefits Other than Pensions 2012 2011 Non-current assets Current... billion at December 29, 2012 and December 31, 2011...follows: (In millions) 2012 2011 Projected benefit obligation ...

  • Page 86
    ... 6.20% 8.26% 4.00% 5.71% 3.99% 4.75% 5.50% 5.50% 3.75% 4.75% 5.50% 2012 2011 Medical cost trend rate Prescription drug cost trend rate Rate to which medical and prescription drug cost trend rates will gradually ...5% 36% to 70% 30% to 60% 3% to 17% 74 Textron Inc. Annual Report â- 2012

  • Page 87
    ...Estate Balance at beginning of year Actual return on plan assets: Related to assets still held at reporting date Related to assets sold during the period Purchases, sales and settlements, net Balance at end ...to our other postretirement benefit plans. Benefit Textron Inc. Annual Report â- 2012 75

  • Page 88
    ...subsidiaries Research credit Valuation allowance on contingent receipts Other, net Effective rate 35.0% 2.2 (5.4) 0.2 (0.5) - - - - (0.6) 30.9% 35.0% 3.1 (9.4) 1.2 (1.5) - - (2.5) - 2.2 28.1% 35.0% (2.7) (60.5) 17.5 (5.1) 12.7 12.0 (5.4) (2.0) (7.9) (6.4)% 76 Textron Inc. Annual Report â- 2012

  • Page 89
    ... the facts, circumstances and information available at the reporting date. For those tax positions for which it... fluctuate significantly on a quarterly and annual basis. Our unrecognized tax benefits represent...as follows: (In millions) December 29, 2012 December 31, 2011 Balance at beginning of year...

  • Page 90
    ... net deferred tax asset (liability) Net deferred tax asset Our net operating loss and credit carryforwards at December 29, 2012 are as follows: (In millions) $ $ 256 591 847 (62) 785 $ $ 288 532 820 8 ... event they no longer are indefinitely reinvested. 78 Textron Inc. Annual Report â- 2012

  • Page 91
    ...respectively. In 2012 and 2010, net taxes paid by the Finance group included payments of $111 million and $103 million primarily from settlements related to the IRS's challenge of tax deductions claimed in prior years for certain leveraged lease transactions. Textron Inc. Annual Report â- 2012 79

  • Page 92
    ...operations before income taxes, are as follows: (In millions) 2012 Revenues 2011 2010 Segment Profit (Loss) 2012 2011 2010 Cessna Bell Textron Systems Industrial Finance Total Special ...- (114) (140) 337 $ (29) 427 230 162 (237) 553 (190) (137) (140) 86 80 Textron Inc. Annual Report â- 2012

  • Page 93
    ...included sales to the U.S. Government of approximately $3.6 billion, $3.5 billion and $3.6 billion in 2012, 2011 and 2010, respectively, primarily in the Bell and Textron Systems segments. Other information... 106 43 82 - 2,150 $ $ 1,557 236 100 36 76 - 2,005 Textron Inc. Annual Report â- 2012 81

  • Page 94
    ... $ 0.43 $ (0.01) 0.42 $ 280,022 0.41 $ (0.01) 0.40 $ 294,632 (0.9)% 14.6 9.3 9.7 19.7 9.1% 28.29 $ 18.37 $ 0.02 $ 2012 Q2 763 $ 1,056 389 756 55 3,019 $ 35 $ 152 40 61 22 310 (20) (35) (82) 173 (1) 172 $ 0.61 $ - 0.61 $ 281,114...loss from continuing operations. 82 Textron Inc. Annual Report â- 2012

  • Page 95
    Schedule II - Valuation and Qualifying Accounts (In millions) 2012 2011 2010 Allowance for doubtful accounts Balance at beginning of year $ 18 4 Charged to costs ...$ 20 7 (9) 18 $ $ 23 2 (5) 20 133 $ 158 35 54 (34) (79) $ 134 $ 133 inventory disposals and Textron Inc. Annual Report â- 2012 83

  • Page 96
    ...of Directors--Director Independence" and "EXECUTIVE COMPENSATION - Transactions with Related Persons" in the Proxy Statement for our Annual Meeting of Shareholders to be held on April 24, 2013 is incorporated by reference into this Annual Report on Form 10-K. 84 Textron Inc. Annual Report â- 2012

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    ...10.1 to Textron's Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2012. Form of Non-Qualified Stock...Performance Share Unit Grant Agreement. Incorporated by reference to Exhibit 10.1H to Textron's Annual Report on Form 10-K for the fiscal year ended January 3, 2009. 3.1B 3.2 ...

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    ...between Textron and its executive officers. Incorporated by reference to Exhibit A to Textron's Proxy Statement for its Annual Meeting of Shareholders on April 29, 1987. (SEC File No. 001-05480) Textron Inc. Annual Report â- 2012 10.2 10.3A 10.3B 10.3C 10.4A 10.4B 10.5A 10.5B 10.6 10.7 10...

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    ... N.A., as Administrative Agent, Citibank, N.A. and Bank of America, N.A., as Syndication Agents, and Deutsche Bank Securities Inc. and The Bank of Tokyo-Mitsubishi Textron Inc. Annual Report â- 2012 87 10.13A 10.13B 10.14A 10.14B 10.14C 10.14D 10.15A 10.15B 10.16 10.17A 10.17B 10.18 ...

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    ...Reformation Agreement, dated May 4, 2009, between Goldman, Sachs & Co. and Textron. Incorporated by reference to Exhibit 10.9 to Textron's Current Report on Form 8-K filed May 5, 2009. Textron Inc. Annual Report â- 2012 10.21B 10.21C 10.21D 10.21E 10.22A 10.22B 10.22C 10.22D 10.22E 10.22F...

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    ...of the Sarbanes-Oxley Act of 2002. The following materials from Textron Inc.'s Annual Report on Form 10-K for the year ended December 29, 2012, formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Statements of Operations, (ii) the Consolidated Statements of Comprehensive...

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    Signatures Pursuant to the requirement of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Annual Report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized on this 15th day of February 2013. TEXTRON INC. Registrant ...

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    Pursuant to the requirements of the Securities Exchange Act of 1934, this Annual Report on Form 10-K has been signed below on this 15th day of... Corporate Controller (principal accounting officer) *By: /s/ Jayne M. Donegan Jayne M. Donegan, Attorney-in-fact Textron Inc. Annual Report â- 2012 91

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    ...Publications and General Information To receive a copy of Textron's Forms 10-K and 10-Q, Proxy Statement or Annual Report without charge, visit our web site at www.textron.com, call (888) TXT-LINE or send...2269; or send an email to [email protected]. 92 Textron Inc. Annual Report â- 2012

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    TEXTRON'S DIVERSE PRODUCT PORTFOLIO INCLUDES GLOBALLY RECOGNIZED BRANDS SUCH AS BELL HELICOPTER, CESSNA AIRCRAFT, CUSHMAN, E-Z-GO, GREENLEE, JACOBSEN, KAUTEX, KLAUKE, LYCOMING AND MORE. BELL CESSNA INDUSTRIAL TEXTRON SYSTEMS BELL-BOEING V-22 OSPREY CITATION LONGITUDE GREENLEE SPEED PUNCHâ„¢ ...

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