Raytheon 2010 Annual Report Download - page 133

I N V E S T O R I N F O R M A T I O N
GLOBAL HEADQUARTERS
Raytheon Company
870 Winter Street
Waltham, MA 02451
781.522.3000
COMMON STOCK SYMBOL
Raytheon Company common stock is listed on the New York
Stock Exchange. The ticker symbol is RTN.
ANNUAL MEETING
The 2011 Annual Meeting of Stockholders will be held on
Thursday, May 26, 2011, at 11:00 a.m.
The Ritz-Carlton, Pentagon City
1250 South Hayes Street
Arlington, VA 22202
703.415.5000
STOCK TRANSFER AGENT, REGISTRAR AND
DIVIDEND DISBURSING AGENT
American Stock Transfer & Trust Company is Raytheon’s
transfer agent and registrar and maintains the company’s
stockholder records. Inquiries concerning dividend payments,
name and address changes, lost stock certificate replacement,
stock ownership transfers and Form 1099 questions should be
directed to: Raytheon Company, c/o American Stock Transfer
& Trust Company, 6201 15th Avenue, Brooklyn, NY 11219, at
800.360.4519.
DIVIDEND DISTRIBUTION/DIRECT DIVIDEND
DEPOSIT
Common stock dividends are payable quarterly upon authoriza-
tion of the Board of Directors, normally at the end of January,
April, July and October. Direct Dividend Deposit (via ACH) is
available to Raytheon stockholders. For enrollment information,
call American Stock Transfer & Trust at 800.360.4519.
DIVIDEND REINVESTMENT
Raytheon Company has a Dividend Reinvestment Plan
administered by American Stock Transfer & Trust Company. This
plan gives stockholders the option of having their cash payments
applied to the purchase of additional shares. For enrollment
information about this plan, call 800.360.4519.
INVESTOR RELATIONS
Security analysts, shareholders and investment professionals with
other inquiries regarding Raytheon Company should contact:
Todd Ernst, vice president, Investor Relations, Raytheon Com-
pany, 870 Winter Street, Waltham, MA 02451, at 877.786.7070.
MEDIA RELATIONS
Members of the news media requesting information about
Raytheon should contact: Jonathan Kasle, director, Media
Relations, Raytheon Company, 870 Winter Street, Waltham, MA
02451, at 781.522.5110.
WEBSITE
Raytheon’s website offers financial information and facts about
the company, its products and services.
We periodically add additional news and information. Raytheon’s
website address is http://www.raytheon.com.
We make our website content available for informational pur-
poses only. It should not be relied upon for investment purposes,
nor is it incorporated by reference into this annual report.
COPIES OF REPORTS
Copies of the company’s annual reports, latest SEC filings, quar-
terly earnings reports and other information may be requested
through the company’s website at http://www.raytheon.com or
by calling 877.786.7070 (Option 1).
RETURN ON INVESTED CAPITAL CALCULATION (ROIC)
Dollars in millions 2010 2009 2008 2007 2006
Income from cont. ops. $ 1,843 $ 1,977 $ 1,698 $ 1,719 $ 1,209
Adjustments:
FAS/CAS pension adj., after-tax(1) 150 (18) 80 168 235
UK Border Agency program adj., after-tax(2) 284 – – – –
Tax settlements (170) – – (219) –
Early debt retirement make-whole
charges, after-tax(1) 47 14 – 38 –
Unfavorable impact of pension
returns on existing contracts, after-tax(1) – – 45 – –
Subtotal 2,154 1,973 1,823 1,706 1,444
Net interest expense, after-tax(1) 72 71 42 21 128
Lease expense, after-tax(1) 67 66 66 63 63
Return $ 2,293 $ 2,110 $ 1,931 $ 1,790 $ 1,635
Net debt(3) $ (171) $ (132) $ (169) $ 559 $ 2,367
Equity less invest. in disc. ops. 9,944 9,560 10,920 11,162 9,456
Lease exp. x 8 plus fin. guarantees 2,890 2,815 2,728 2,656 2,619
Pension liability, net of tax 3,049 3,612 2,650 1,844 1,762
Invested cap. from cont. ops.(4) $15,712 $ 15,855 $ 16,129 $ 16,221 $ 16,204
ROIC 14.6% 13.3% 12.0% 11.0% 10.1%
(1) Calculated using the federal statutory tax rate of 35%
(2) Calculated using the UK statutory tax rate that was in effect in the second quarter of 28%
(3) Net debt is defined as total debt less cash and cash equivalents and is calculated using a 2 point average
(4) Calculated using a 2 point average
We define ROIC as income from continuing operations excluding the after-tax effect of the FAS/CAS Pension
Adjustment and, from time to time, certain other items as set forth above in the calculation, plus after-tax net
interest expense plus one-third of operating lease expense after-tax (estimate of interest portion of operating
lease expense) divided by average invested capital after capitalizing operating leases (operating lease expense
times a multiplier of 8), adding financial guarantees less net investment in Discontinued Operations, and add-
ing back the liability for defined benefit pension plans, net of tax.
ADJUSTED EARNING PER SHARE (EPS) RECONCILIATION
2010 2009 2008 2007 2006
Diluted EPS from cont. ops. $ 4.79 $ 4.89 $ 3.93 $ 3.78 $ 2.62
FAS/CAS pension adj., after-tax(1) 0.40 (0.04) 0.19 0.37 0.52
UK Border Agency program adj., after-tax(2) 0.75 – – – –
Tax settlements (0.45) – – (0.49) –
Early debt retirement make-whole
charges, after-tax(1) 0.13 0.04 – 0.08 –
Acceleration of deferred gains related
to terminated interest rate swaps
on retired debt, after tax(1) (0.03) (0.01) – – –
Unfavorable impact of pension returns
on existing contracts, after-tax(1) – – 0.11 – –
Adjusted EPS $ 5.58 $ 4.87 $ 4.22 $ 3.75 $ 3.13
(1) Calculated using the federal statutory tax rate of 35%
(2) Calculated using the UK statutory tax rate that was in effect in the second quarter of 28%
We define Adjusted EPS as diluted EPS from continuing operations attributable to Raytheon Company
common stockholders excluding the EPS impact of the FAS/CAS Pension Adjustment and, from time to time,
certain other items as set forth above in the reconciliation. Amounts may not recalculate due to rounding.
ADJUSTED INCOME RECONCILIATION
Dollars in millions  2010 2009 2008 2007 2006
Income from cont. ops. attributable to
Raytheon Company common stockholders $ 1,804 $ 1,936 $ 1,674 $ 1,693 $ 1,187
FAS/CAS pension adj., after-tax(1) 150 (18) 80 168 235
UK Border Agency program adj., after-tax(2) 284 – – – –
Tax settlements (170) – – (219) –
Early debt retirement make-whole
charges, after-tax(1) 47 14 – 38 –
Acceleration of deferred gains related
to terminated interest rate swaps
on retired debt, after tax(1) (10) (4) – – –
Unfavorable impact of pension returns
on existing contracts, after-tax(1) – – 45 – –
Adjusted Income $ 2,105 $ 1,928 $ 1,799 $ 1,680 $ 1,422
(1) Calculated using the federal statutory tax rate of 35%
(2) Calculated using the UK statutory tax rate that was in effect in the second quarter of 28%
We define Adjusted Income as income from continuing operations attributable to Raytheon Company com-
mon stockholders excluding the impact of the FAS/CAS Pension Adjustment and, from time to time, certain
other items as set forth above in the reconciliation.
ROIC, Adjusted EPS and Adjusted Income are not measures of financial performance under generally
accepted accounting principles (GAAP) and may not be defined and calculated by other companies in the
same manner. The Company uses ROIC as a measure of the efficiency and effectiveness of its use of capital
and as an element of management compensation. ROIC, Adjusted EPS and Adjusted Income should be
considered supplemental to and not a substitute for financial information prepared in accordance with
GAAP. We are providing these measures because management uses them for the purposes of evaluating
and forecasting the Company’s financial performance and believes that they provide additional insights
into the Company’s underlying business performance. We also believe that they allow investors to benefit
from being able to assess our operating performance in the context of how our principal customer, the U.S.
Government, allows us to recover pension costs and to better compare our operating performance to others
in the industry on that same basis.
Copyright © 2011 Raytheon Company. All rights reserved.
Raytheon is an equal opportunity employer.