Raytheon 2006 Annual Report Download - page 87

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RAYTHEON COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions) Years Ended December 31: 2006 2005 2004
Cash flows from operating activities
Net Income $ 1,283 $ 871 $ 417
Less: Income from discontinued operations, net of tax (176) (53) (2)
Less: Cumulative effect of change in accounting principle, net of tax —— (41)
Income from continuing operations 1,107 818 374
Adjustments to reconcile income from continuing operations to net cash provided by
operating activities from continuing operations, net of the effect of acquisitions and
divestitures
Depreciation and amortization 373 358 349
Deferred federal and foreign income taxes 184 27 (7)
Net gain on sales of operating units and investments (18) (45) (10)
Savings and investment plan activity ——73
Decrease (increase) in accounts receivable 49 (6) 37
Change in contracts in process and advance payments and billings in excess of
costs incurred 151 194 (9)
Decrease in inventories 36 64 8
Decrease (increase) in prepaid expenses and other current assets 19 54 (165)
Increase in accounts payable 106 82 56
Increase in accrued salaries and wages 246 170
(Decrease) increase in other accrued expenses (3) 13 305
Change in income taxes payable 120 414 147
Origination of financing receivables (8) (23) (29)
Collection of financing receivables not sold 123 128 122
Sale of financing receivables 53 ——
Pension and other adjustments, net 175 189 268
Net cash provided by operating activities from continuing operations 2,469 2,313 1,689
Net cash provided by operating activities from discontinued operations 274 202 382
Net cash provided by operating activities 2,743 2,515 2,071
Cash flows from investing activities
Expenditures for property, plant and equipment (295) (298) (317)
Proceeds from sales of property, plant and equipment 311 —
Capitalized expenditures for internal use software (77) (73) (96)
Change in other assets (1) 10 (1)
Proceeds from sales of operating units and investments 53 78 43
Payment for purchases of acquired companies, net of cash received (87) (125) (112)
Net cash used in investing activities from continuing operations (404) (397) (483)
Net cash used in investing activities from discontinued operations (47) (39) (49)
Net cash used in investing activities (451) (436) (532)
Cash flows from financing activities
Dividends paid (420) (387) (349)
Decrease in short-term debt and other notes (80) (5) (15)
Repayments of long-term debt —(671) (1,763)
Repayments of subordinated notes payable (382) — (478)
Issuance of common stock —— 867
Repurchase of common stock (352) (436) —
Proceeds under common stock plans 169 68 92
Tax benefit from stock-based awards 31 ——
Net cash used in financing activities from continuing operations (1,034) (1,431) (1,646)
Net cash (used in) provided by financing activities from discontinued operations —(2) 2
Net cash used in financing activities (1,034) (1,433) (1,644)
Net increase (decrease) in cash and cash equivalents 1,258 646 (105)
Cash and cash equivalents at beginning of year 1,202 556 661
Cash and cash equivalents at end of year $ 2,460 $ 1,202 $ 556
The accompanying notes are an integral part of the financial statements.
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