Raytheon 2015 Annual Report Download - page 76

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66
actual asset performance, averaged over three years and PPA discount rates, which are based on a 24-month average of high
quality corporate bond rates, as published by the IRS. As discussed in Critical Accounting Estimates beginning on page 32,
the STE Act, HATFA Act and BBA Act were passed by Congress and signed by the President in 2012, 2014 and 2015,
respectively. The STE Act includes a provision for temporary pension funding relief due to the low interest rate environment.
The provision adjusts the 24-month average high quality corporate bond rates used to determine the PPA funded status so that
they are within a floor and cap, or “corridor”, based on the 25-year average of corporate bond rates. The STE Act gradually
phased out this interest rate provision beginning in 2013. The HATFA and BBA Acts extended the phase out provisions until
2020. As a result, the interest rates used to determine PPA funded status will continue to be adjusted within a “corridor” and
do not begin to phase out until 2020.
We made the following required and discretionary contributions during the years ended December 31:
(In millions) 2015 2014 2013
Required pension contributions $ 339 $ 650 $ 778
Discretionary pension contributions 200 600 300
PRB contributions 22 20 22
Total $ 561 $ 1,270 $ 1,100
The decrease in required pension contributions of $311 million in 2015 compared to 2014 and $128 million in 2014 compared
to 2013 was primarily due to HATFA as described above.
We expect to make required contributions to our pension and PRB plans of approximately $165 million in 2016. We periodically
evaluate whether to make discretionary contributions. Due to the differences in requirements and calculation methodologies,
our FAS pension expense or income is not indicative of the funding requirement or amount of government recovery.
Tax Payments and Refunds—We made the following net tax payments during the years ended December 31:
(In millions) 2015 2014 2013
Federal $ 1,008 $ 705 $ 628
Foreign 43 19 22
State 30 35 39
The increase in net tax payments of $322 million in 2015 compared to 2014 was primarily due to the timing and amount of
pension contributions. Federal and foreign net tax payments for 2016 are expected to approximate $700 million. The decrease
in expected federal and foreign net tax payments in 2016 is primarily due to the timing and amount of pension contributions.
Interest Payments—We made interest payments on our outstanding debt of $232 million, $209 million and $210 million in
2015, 2014 and 2013, respectively. The increase in interest payments in 2015 compared to 2014 was primarily due to the
issuance of $600 million of fixed-rate long-term debt in the fourth quarter of 2014.
Investing Activities
(In millions) 2015 2014 2013
Net cash provided by (used in) investing activities $(1,744)$(1,322)$
(473)
The change of $422 million in net cash provided by (used in) investing activities in 2015 compared to 2014 was primarily
due to higher cash payments for acquisitions described below, partially offset by our short-term investments activity as described
below. The change of $849 million in net cash provided by (used in) investing activities in 2014 compared to 2013 was
primarily due to higher cash payments for acquisitions and the short-term investments activity, both described below.