Raytheon 2012 Annual Report Download - page 68

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60
Technology Integration (HTI) forward-looking infrared kits for the U.S. Army, $104 million on the NMT program for the
U.S. Navy and $96 million for Improved Thermal Sight Systems (ITSS) for an international customer.
Space and Airborne Systems
% Change
(In millions, except percentages) 2012 2011 2010
2012
compared
to 2011
2011
compared
to 2010
Total Net Sales $ 5,333 $ 5,255 $ 4,830 1.5 % 8.8%
Total Operating Expenses
Cost of sales—labor 2,071 2,077 1,968 (0.3)% 5.5%
Cost of sales—materials and subcontractors 1,775 1,820 1,632 (2.5)% 11.5%
Other cost of sales and other operating expenses 703 641 554 9.7 % 15.7%
Total Operating Expenses 4,549 4,538 4,154 0.2 % 9.2%
Operating Income $ 784 $ 717 $ 676 9.3 % 6.1%
Operating Margin 14.7% 13.6% 14.0%
Change in Operating Income (in millions)
Year
Ended
2012
Versus
Year Ended
2011
Year Ended
2011 Versus
Year Ended
2010
Volume $5
$ 43
Net change in EAC adjustments 51 16
Mix and other performance 11 (18)
Total Change in Operating Income $ 67 $ 41
% Change
(In millions, except percentages) 2012 2011 2010
2012
compared
to 2011
2011
compared
to 2010
Bookings $ 5,305 $ 4,592 $ 4,321 15.5% 6.3 %
Total Backlog 6,031 5,864 5,981 2.8% (2.0)%
SAS is a leader in the design and development of integrated systems and solutions for advanced missions, including traditional
and non-traditional ISR, precision engagement, unmanned aerial operations, and space. Leveraging advanced concepts, state-
of-the-art technologies and mission systems knowledge, SAS provides electro-optical/infrared sensors, airborne radars for
surveillance and fire control applications, lasers, precision guidance systems, signals intelligence systems, processors,
electronic warfare systems and space-qualified systems for civil and military applications. Key customers include the U.S.
Navy, Air Force and Army, as well as classified and international customers.
Total Net Sales—Total net sales in 2012 were relatively consistent with 2011. Included in total net sales was $100 million of
higher net sales due to increased volume on an international tactical airborne radar program primarily due to program schedule
requirements, partially offset by lower net sales of $97 million primarily due to lower volume on certain sensor systems
programs due to program schedule requirements. The remaining change in total net sales was primarily spread across numerous
domestic programs with no individual or common significant driver.
The increase in total net sales of $425 million in 2011 compared to 2010 was primarily due to $200 million of higher net sales
related to RAST, which we acquired in the first quarter of 2011, $187 million of higher volume on ISR systems programs due
to increased bookings over the last few years driven by customer demand for these capabilities, and $102 million from higher
volume, as production work increased, as planned, on an international airborne tactical radar program awarded in the first
half of 2010.