Raytheon 2010 Annual Report Download - page 60

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The increase in operating income of $20 million in 2009 compared to 2008 was primarily due to higher volume, which
had a $12 million impact on operating income. Included in operating income for 2009 was improved program
performance of $26 million on the Phalanx program primarily as a result of the implementation of value engineering
change proposals (VECP), which reduced production costs, primarily from material and labor efficiencies. Operating
income in 2008 included $25 million from higher award fees recognized on the Standard Missile-3 program driven by a
successful flight test milestone. Operating margin in 2009 remained relatively consistent with 2008.
Backlog and Bookings—The increase in backlog of $555 million at December 31, 2010 compared to December 31, 2009
was primarily due to higher bookings in 2010. The decrease in backlog of $2,280 million at December 31, 2009 compared
to December 31, 2008 was primarily due to the termination for convenience of the KEI program as previously described.
The 2010 bookings, which increased $937 million over 2009 included $743 million for Standard Missile-3 for the MDA
and an international customer, $698 million for the production of AMRAAM for the U.S. Air Force and international
customers, $675 million on a classified program, $668 million for the production of Paveway™ for the Kingdom of Saudi
Arabia and other international customers, $501 million for the production of Tomahawk missiles for the U.S. Navy and
an international customer, $451 million for engineering and manufacturing development of Small Diameter Bomb II
(SDB II) for the joint U.S. Air Force and U.S Navy program, $425 million for the production of Standard Missile-2 for
the U.S. Navy and international customers, $274 million for the production of Rolling Airframe Missile (RAM) for the
U.S. Navy and international customers, $271 million for the Phalanx Weapons System for the U.S. Navy, Army and
international customers, $262 million for development work on the Exoatmospheric Kill Vehicle program for the MDA,
$209 million for the production of AIM-9X Sidewinder short range air-to-air missiles for the U.S. Navy and international
customers, $198 million for the Javelin program for the U.S. Army and international customers, $168 million on the
Miniature Air-Launched Decoy (MALD) for the U.S. Air Force, Army, and Navy, $147 million for Evolved Sea Sparrow
Missiles (ESSM) for the U.S. Navy and international customers, $122 million for the production of TOW missiles for U.S.
Army and international customers, and $114 million for the production of the Joint Stand-off Weapon (JSOW) for the
U.S. Navy and international customers.
The decrease in bookings of $495 million in 2009 was primarily due to $318 million of awards for Standard Missile-3 for
the U.S. Navy and the MDA in 2009 compared to $1.2 billion in 2008. In 2009, MS booked $645 million for AMRAAM
systems for international customers and the U.S. Air Force, $514 million for the tube launched, optically-tracked, wireless
guided missile program for international customers and the U.S. Army, $508 million for ESSM for international
customers and the U.S. Navy and $402 million for Phalanx Weapon Systems. MS also booked $384 million on Standard
Missile-2 for international customers and the U.S. Navy, $318 million for Standard Missile-3 for the MDA and $294
million for Tactical Tomahawk cruise missiles for the U.S. Navy.
In 2008, MS booked $1.2 billion for the production of Standard Missile-3 for the U.S. Navy and the MDA, $624 million
for the production of the AMRAAM program for international customers and the U.S. Air Force, $577 million on
Standard Missile Development and Production, and $478 million for the production of Tactical Tomahawk cruise
missiles for the U.S. Navy.
Network Centric Systems
% Change
(In millions, except percentages) 2010 2009 2008
2010
compared
to 2009
2009
compared
to 2008
Total Net Sales $4,918 $4,822 $4,510 2.0% 6.9%
Total Operating Expenses 4,217 4,148 3,935 1.7% 5.4%
Operating Income 701 674 575 4.0% 17.2%
Operating Margin 14.3% 14.0% 12.7%
Bookings $4,034 $3,933 $4,938 2.6% -20.4%
Total Backlog 4,912 5,501 5,733 -10.7% -4.0%
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