Raytheon 2012 Annual Report Download - page 77

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69
Inc. and Pikewerks Corporation acquisitions enhance our cybersecurity and information assurance capabilities at Intelligence
and Information Systems (IIS). The Ktech Corporation acquisition is part of our strategy to extend and enhance our Missile
Systems (MS) offerings. In connection with these acquisitions, we recorded $112 million of goodwill, primarily related to
expected synergies from combining operations and the value of the existing workforce, and $26 million of intangible assets,
primarily related to customer relationships, trade names and technology with an initial estimated weighted-average life of
seven years.
In 2010, we acquired Trusted Computer Solutions Inc., Technology Associates Inc. and substantially all of the assets of an
Australian company, Compucat Research Pty. Ltd, for an aggregate of $152 million in cash, net of cash acquired. These
acquisitions enhance our cybersecurity and information assurance capabilities at IIS. In connection with these acquisitions,
we recorded $125 million of goodwill, primarily related to expected synergies from combining operations and the value of
the existing workforce, and $28 million of intangible assets, primarily related to technology, trade names and customer
relationships with a weighted-average life of five years.
Financing Activities
(In millions) 2012 2011 2010
Net cash provided by (used in) financing activities $(1,246)$(694)$
(411)
We have used cash provided by operating activities, and proceeds from the issuance of new debt in 2012 and 2011 as our
primary source for the repayment of debt, payment of dividends, pension contributions and the repurchase of our common
stock. The change of $552 million in net cash provided by (used in) financing activities in 2012 compared to 2011 was primarily
due to the repayments of long-term debt in 2012 offset by the change in the amount of stock repurchased described below.
The change of $283 million in net cash provided by (used in) financing activities in 2011 compared to 2010 was primarily
due to lower net proceeds from debt issuances and repayments in 2011 compared to 2010, and the lower level of warrants
exercised in 2011 compared to 2010.
Debt—In the fourth quarter of 2012, we received proceeds of $1,092 million for the issuance of $1.1 billion fixed rate long-
term debt and exercised our call rights to repurchase, at prices based on fixed spreads to U.S. Treasuries, $970 million of our
long-term debt due in 2014 and 2015 at a loss of $29 million pretax, $19 million after-tax, which is included in other expense
(income), net.
In the fourth quarter of 2011, we received proceeds of $992 million for the issuance of $1.0 billion fixed rate long-term debt.
In the fourth quarter of 2010, we received proceeds of $1,975 million for the issuance of $2.0 billion fixed rate long-term debt
and exercised our call rights to repurchase, at prices based on fixed spreads to U.S. Treasuries, $678 million of our long-term
debt due in 2012 and 2013 at a loss of $73 million pretax, $47 million after-tax, which is included in other expense (income),
net.
Stock Repurchases—In September 2011, our Board of Directors authorized the repurchase of up to an additional $2.0 billion
of our outstanding common stock. At December 31, 2012, we had approximately $1.3 billion remaining under this repurchase
program. All previous programs have been completed as of December 31, 2012. Share repurchases will take place from time
to time at management’s discretion depending on market conditions.
Stock repurchases also include shares surrendered by employees to satisfy tax withholding obligations in connection with
restricted stock awards, restricted stock units and stock options issued to employees.
Our stock repurchases were as follows:
(In millions) 2012 2011 2010
$ Shares $ Shares $ Shares
Stock repurchased under our stock repurchase programs $ 825 15.9 $ 1,250 27.1 $ 1,450 29.0
Stock repurchased to satisfy tax withholding obligations 37 0.7 36 0.7 46 0.8
Total stock repurchases $ 862 16.6 $ 1,286 27.8 $ 1,496 29.8