Raytheon 2009 Annual Report Download - page 72

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The increase of $710 million in net cash provided by operating activities in 2009 compared to 2008 was primarily due to:
$240 million of lower net tax payments, driven by the $350 million refund discussed below and $69 million of
overpayment credits; $42 million of lower pension and other postretirement benefit payments as discussed below; and
$37 million of proceeds from the termination of our interest rate swap agreements. The remainder of the increase in net
cash was primarily due to an increase in net cash receipts in line with total net sales growth. The increase of $817 million
in net cash provided by operating activities in 2008 compared to 2007 was primarily due to lower tax payments and
pension plan contributions.
Tax Payments—Total federal and foreign tax payments, net of refunds and credits, were $208 million in 2009 compared
to $448 million in 2008 and $734 million in 2007. Net tax payments in 2009 included $350 million of refunds and $69
million of overpayment credits. Net tax payments in 2007 included $631 million of payments related to the sale of
Raytheon Aircraft and refunds of $381 million related to a federal research credit claim and export tax benefit claims.
Federal and foreign tax payments, net of refunds and credits, for 2010 are expected to approximate $840 million.
Pension Plan Contributions—We make both discretionary and required contributions to our pension plans. Required
contributions are primarily determined by ERISA and are affected by the actual return on plan assets and plan funded
status. If discretionary contributions are made, a funding credit is accumulated which can be used to offset future
calculated required contributions. The funding credit for our pension plans was $2.6 billion at December 31, 2009.
Discretionary and required contributions were as follows:
(In millions) 2009 2008 2007
Discretionary contributions $—$ 660 $ 900
Required contributions 1,115 514 416
Total $1,115 $1,174 $1,316
Required contributions in 2009 were higher than 2008 due to the impact of the decline in the value of pension plan assets
in 2008. Discretionary contributions in 2008 were lower than in 2007 due to the acceleration of a planned 2008
contribution of $500 million into December of 2007. We expect to make required contributions to our pension plans of
approximately $1.1 billion in 2010. We will continue to periodically evaluate whether to make additional discretionary
contributions. Future funding requirements will likely be affected by the requirements under the Pension Protection Act
of 2006 as further discussed below in Contractual Obligations. Other postretirement benefit payments were $45 million,
$28 million and $43 million in 2009, 2008 and 2007, respectively.
Financing Receivables—Collections of financing receivables were $46 million, $68 million and $88 million in 2009, 2008
and 2007, respectively. As a result of our divestitures of Raytheon Aircraft and Flight Options in 2007, we do not expect to
originate any significant long-term aircraft financing receivables in the future; however, we continue to hold $53 million
of financing receivables as part of our commuter aircraft portfolio.
Interest payments were $147 million, $142 million and $232 million in 2009, 2008 and 2007, respectively. The decrease in
interest payments in 2008 compared to 2007 was primarily due to a decrease in average debt outstanding.
Investing Activities
(In millions) 2009 2008 2007
Net cash (used in) provided by investing activities from continuing operations $(692) $(417) $2,536
Net cash (used in) provided by investing activities (692) (417) 2,507
The increase of cash outflows of $275 million in net cash (used in) provided by investing activities in 2009 compared to
2008 was primarily due to the acquisition of BBN in the fourth quarter of 2009. The decrease of $2,924 million in net cash
(used in) provided by investing activities in 2008 compared to 2007 was primarily due to the proceeds from the
divestitures of Raytheon Aircraft and Flight Options in 2007 discussed below.
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