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8-K - FORM 8-K - GOODRICH CORP | c91264e8vk.htm |
EX-99.2 - EXHIBIT 99.2 - GOODRICH CORP | c91264exv99w2.htm |
Exhibit 99.1
News Release | ||
Media Contact: Lisa Bottle +1 704 423 7060 Laurie Tardif +1 704 423 7048 Investor Relations: Paul Gifford +1 704 423 5517 For Immediate Release |
Goodrich
Corporation Four Coliseum Centre 2730 West Tyvola Road Charlotte, NC 28217-4578 Tel: 704 423 7000 Fax: 704 423 7002 www.goodrich.com |
Goodrich Announces Third Quarter 2009 Net Income per Diluted Share of $1.14, Adjusts Outlook for
Full Year 2009, Provides Outlook for 2010
| Third quarter 2009 net income per diluted share of $1.14 decreased 14 percent compared
to third quarter 2008 net income per diluted share of $1.32. |
| Third quarter 2009 sales of $1,648 million decreased 7 percent compared to third quarter
2008 sales of $1,772 million. |
| Third quarter 2009 total segment operating income margin was 15.8 percent, compared to
18.2 percent in the third quarter 2008. |
| Full year 2009 net income per diluted share expectations are unchanged at $4.60 $4.75. |
| Full year 2009 sales are expected to be approximately $6.7 billion, compared to previous
expectations of approximately $6.9 billion. Full year 2009 expectations for net cash
provided by operating activities, minus capital expenditures, are unchanged at greater than
75 percent of 2009 net income from continuing operations. |
| Full year 2010 outlook for sales of approximately $7.0 billion and net income per
diluted share in the $4.15 $4.40 range, including higher pension expense of $0.14 per
diluted share. Net cash provided by operating activities, minus capital expenditures, is
expected to be approximately 85 percent of net income in 2010. |
CHARLOTTE, N.C., Oct. 22, 2009 Goodrich Corporation (NYSE: GR) announced results today for the
third quarter 2009, adjusted its outlook for the full year 2009 and announced its outlook for the
full year 2010.
Commenting on the companys performance and its 2010 outlook, Marshall Larsen, Chairman, President
and Chief Executive Officer said, Our third quarter earnings
were characterized by solid
performance in our military businesses and continued success on our cost containment efforts. The
environment for commercial aerospace, however, remains challenging. While advance bookings for
aftermarket products and services remain weak, there are some hopeful signs of recovery in the
airline system. Freight traffic continues to improve
from levels seen earlier this year and airline ridership and load factors are improving. Although
airline capacity has yet to turn the corner, we believe that 2010 will be a year of modest recovery
which should allow us to grow our commercial aftermarket sales. We expect aftermarket sales to
continue to be weak for the first few months of 2010, with the recovery beginning towards the
middle of the year.
In our original equipment market channel, Boeing and Airbus appear to be on track to deliver a
total of about 960 airplanes in 2009. While both manufacturers are striving to maintain stable
production for their narrowbody airplanes through at least 2010, it is still unclear whether or not
they will be successful. Our outlook for 2010 assumes they will successfully maintain current
narrowbody production rates, but we are prepared to take quick action should either manufacturer
announce a reduction in production rates.
Our defense and space sales growth has been robust during the first nine months of 2009, and we
expect 2009 sales for our defense and space products and services to grow by about 11 percent,
compared to 2008. We expect continued growth, although at slightly lower levels, in 2010, compared
to 2009.
Third Quarter 2009 Results
Goodrich reported third quarter 2009 net income of $145 million, or $1.14 per diluted share, on
sales of $1,648 million. In the third quarter 2008, the company reported net income of $168
million, or $1.32 per diluted share, on sales of $1,772 million.
The change in net income per diluted share is primarily attributable to the impact on income of the
lower sales, which were partially offset by successful cost containment initiatives, and several
other factors as noted below:
| The third quarter 2009 results included pre-tax expense of $45 million, $28 million
after-tax or $0.22 per diluted share, related to worldwide pension plan expense, compared
to pre-tax pension expense of $19 million, $12 million after-tax or $0.09 per diluted
share, recorded during the third quarter 2008. |
| The third quarter 2009 results included pre-tax income of $13 million, $8 million
after-tax or $0.06 per diluted share, related to the revision of estimates for certain
long-term contracts primarily in our aerostructures and aircraft wheels and brakes
businesses, compared to pre-tax income of $39 million, $24 million after-tax or $0.19 per
diluted share, recorded during the third quarter 2008. These revisions were primarily
related to favorable cost and operational performance, changes in volume expectations and
to some extent, sales pricing improvements on follow-on contracts. |
| The company reported an effective tax rate of 24 percent for the third quarter of 2009,
compared to an effective tax rate of 35 percent during the third quarter 2008. |
| The third quarter 2009 results included after-tax income from discontinued operations
totaling $3 million, or $0.02 per diluted share. |
Page 2
The $124 million decrease in sales is attributable to sales reductions of approximately $33 million
related to foreign currency exchange rate impacts, approximately $34 million for lower reported
sales resulting from the formation of the engine controls joint venture with Rolls-Royce and the
impact of current economic conditions on the companys major market channels.
For the third quarter 2009 compared with the third quarter 2008, Goodrich sales changes by market
channel were as follows:
| Large commercial airplane original equipment sales increased by 9 percent, |
| Regional, business and general aviation airplane original equipment sales decreased by
45 percent, |
| Large commercial, regional, business and general aviation airplane aftermarket sales
decreased by 19 percent, and |
| Defense and space sales of both original equipment and aftermarket products and services
increased by 9 percent. |
Net cash provided by operating activities during the third quarter 2009 was $253 million, an
increase of $111 million from the same period in 2008. The increase was primarily attributable to
reduced pension contributions and higher cash received in advance of future services, partially
offset by lower income from continuing operations, in the third quarter 2009, compared to the third
quarter 2008. Capital expenditures were $42 million in the third quarter 2009 compared with
capital expenditures of $73 million in the third quarter 2008. During the third quarter 2009, cash
flow provided by operating activities, minus capital expenditures, was 150 percent of income from
continuing operations.
Year-to-date 2009 Results
For the first nine months of 2009, the company reported net income of $492 million, or $3.88 per
diluted share, on sales of $5,043 million. During the first nine months of 2008, net income was
$513 million, or $4.01 per diluted share, on sales of $5,367 million.
The $324 million decrease in sales is attributable to sales reductions of approximately $172
million related to foreign currency exchange rate impacts, approximately $90 million for lower
reported sales resulting from the formation of the engine controls joint venture with Rolls-Royce
and the impact of current economic conditions on the companys major market channels.
Page 3
The change in net income per diluted share is primarily attributable to the impact on income of the
lower sales, which were partially offset by successful cost containment initiatives, and several
other factors as noted below:
| The first nine months of 2009 results included pre-tax expense of $133 million, $83
million after-tax or $0.66 per diluted share, related to worldwide pension plan expense,
compared to pre-tax pension expense of $57 million, $36 million after-tax or $0.28 per
diluted share, recorded during the first nine months of 2008. |
| The first nine months of 2009 results included after-tax income from discontinued
operations totaling $35 million, or $0.27 per diluted share, primarily associated with
resolution of a past environmental claim. |
| The first nine months of 2009 results included pre-tax income of $26 million, $16
million after-tax or $0.13 per diluted share, related to the revision of estimates for
certain long-term contracts primarily in our aerostructures and aircraft wheels and brakes
businesses, compared to pre-tax income of $87 million, $54 million after-tax or $0.42 per
diluted share, recorded during the first nine months of 2008. These revisions were
primarily related to favorable cost and operational performance, changes in volume
expectations and to some extent, sales pricing improvements on follow-on contracts. |
| The company reported an effective tax rate of 26 percent for the first nine months of
2009, compared with an effective tax rate of 32 percent during the first nine months of
2008. |
Net cash provided by operating activities during the first nine months of 2009 was $427 million, a
decrease of $34 million from the same period in 2008. The decrease was primarily attributable to
an increase in worldwide pension plan contributions, partially offset by a decrease in net tax
payments, during the first nine months of 2009, compared to the first nine months of 2008.
Capital expenditures were $115 million for the first nine months of 2009 compared to capital
expenditures for the first nine months of 2008 of $190 million.
Business Highlights
| On October 13, 2009 the Goodrich Board of Directors declared an increased quarterly
dividend of $0.27 per share of common stock, payable January 4, 2010 to shareholders of
record on December 1, 2009. This dividend declaration represents an 8 percent increase
over the previous quarterly dividend of $0.25 per share of common stock. |
| On August 31, 2009 Goodrich was awarded a contract by the Defense Logistics Agency -
Ogden to provide new carbon brakes and boltless wheels for the U.S. Air Forces fleet of
C-130 transport aircraft. The selection is expected to generate up to $400 million in
revenue over the life of the program, including original equipment and aftermarket sales
for U.S. and international customers. |
| On August 12, 2009 Goodrich and Xian Aircraft International Corporation (XAIC)
announced that they have signed agreements to form two joint venture companies to support
landing gear and engine nacelle components manufacturing focused on the fast-growing
Chinese aerospace market. The new companies are expected to compete for market positions on
the COMAC C919 single aisle Chinese commercial aircraft currently under development, and
also manufacture various landing gear and nacelle components and subassemblies for other
aircraft. |
Page 4
| On July 29, 2009 the U.S. Air Force authorized continued development of the
Operationally Responsive Space (ORS) program that features Goodrichs satellite. This build
authorization follows a successful critical design review that Goodrich completed eight
months from the beginning of the contract. Satellite delivery and launch are on schedule
to occur in late 2010. |
2009 Outlook
The companys 2009 sales outlook is based on market assumptions for each of its major market
channels. The current market assumptions for the full year 2009, compared with the full year 2008
outlook, include:
| Large commercial airplane original equipment sales are expected to increase slightly, |
| Regional, business and general aviation airplane original equipment sales are expected
to decrease by almost 30 percent. Regional airplane original equipment sales are expected
to decrease by about 20 percent, and business and general aviation original equipment sales
are expected to decrease by more than 40 percent, |
| Large commercial, regional, business and general aviation airplane aftermarket sales are
expected to decrease by 13 15 percent, and |
| Defense and space sales of both original equipment and aftermarket products and services
are expected to increase by about 11 12 percent. |
The company expects full year 2009 sales to be about $6.7 billion, compared to the prior outlook of
$6.9 billion, representing a sales decrease of about 5 percent compared to 2008. The 2009 sales
expectations, compared to 2008, include unfavorable sales impacts of approximately $154 million, or
2 percent of sales, related to foreign currency exchange rate fluctuations and lower sales of
approximately $125 million related to the formation of the Rolls-Royce engine controls joint
venture.
The company continues to expect that 2009 net income per diluted share will be in a range of $4.60
$4.75. The 2009 outlook includes, among other factors:
| Higher pre-tax pension expense of $102 million, or $0.51 per diluted share, compared to
2008, |
| After-tax income from discontinued operations totaling $35 million, or $0.27 per diluted
share, primarily associated with resolution of a past environmental claim, |
| Restructuring charges totaling about $0.10 $0.15 per diluted share. About $0.08 per
diluted share of the expected charges were incurred during the first nine months of 2009,
and |
| A full year 2009 effective tax rate of 26 27 percent. |
For 2009, Goodrich continues to expect net cash provided by operating activities, minus capital
expenditures, to exceed 75 percent of net income from continuing operations. This outlook reflects
ongoing investments to support the current schedule for the Boeing 787 and Airbus A350 XWB airplane
programs, and low-cost country manufacturing and productivity initiatives that are expected to
enhance margins over the near and long term. The company now expects capital expenditures for 2009
to be in a range of $190 $200 million, compared to the prior expectations of $200 $220 million.
Page 5
2010 Outlook
The companys 2010 sales outlook is based on market assumptions for each of its major market
channels. The current market assumptions for the full year 2010, compared with the full year 2009
outlook, include:
| Large commercial airplane
original equipment sales are expected to increase by about 8
10 percent. This outlook assumes that current narrowbody production rates are maintained
through early 2011, and that 787 deliveries begin in late 2010. Additionally, part of the
expected growth in sales is related to the 2008 Boeing strike, which adversely impacted
first quarter 2009 sales, but is not expected to have any impact on 2010 sales, |
| Regional, business and general aviation airplane original equipment sales are expected
to decrease by approximately 8 10 percent, |
| Large commercial, regional, business and general aviation airplane aftermarket sales are
expected to increase by about 4
7 percent. This outlook assumes that worldwide available
seat miles (ASMs) increase in the range
of 1 3 percent in 2010. Goodrich expects
continued aftermarket sales weakness in the first part of 2010 and that sales will begin to
grow towards the middle of 2010, and |
| Defense and space sales of both original equipment and aftermarket products and services
are expected to increase by about 5 percent. |
The companys initial full year 2010 sales expectations are for sales of approximately $7.0
billion, representing growth of about 5 percent from the current outlook for 2009. The outlook for
2010 income from continuing operations and net income per diluted share is for a range of $4.15
$4.40, about flat compared to the companys current outlook for income from continuing operations
for the full year 2009.
The 2010 outlook includes, among other factors:
| Higher worldwide pre-tax pension expense of up to $28 million, or $0.14 per diluted share. The
higher pension expense assumes a 2009 return on U.S. plan assets consistent with our 2009
assumption of 8.75 percent and a 2010 U.S. discount rate of
approximately 5.6 percent, both of
which reflect experience through September 30, 2009. The
companys U.S. discount rate for 2009
was 6.47 percent. Pension expense for 2010 will be finalized based on actual asset values
and discount rates on December 31, 2009, |
| A full-year effective tax rate of 29 30 percent for 2010, reducing income per diluted
share by about $0.19, compared to expectations for 2009. |
Page 6
For 2010, Goodrich expects net cash provided by operating activities, minus capital expenditures,
to approximate 85 percent of net income. This outlook reflects ongoing investments to support the
current schedule for the Boeing 787 and Airbus A350 XWB airplane programs, and low-cost country
manufacturing and productivity initiatives that are expected to enhance margins over the near and
long term. The company expects capital expenditures for 2010 to be in a range of $250 $275
million.
The current sales, net income and net cash provided by operating activities outlooks for 2009 and
2010 do not include the impact of potential acquisitions or divestitures.
The supplemental discussion and tables that follow provide more detailed information about the
third quarter 2009 segment results.
Goodrich will hold a conference call on October 22, 2009 at 10:00 AM U.S. Eastern Time to discuss
this announcement. Interested parties can listen to a live webcast of the conference call, and
view the related presentation materials, at www.goodrich.com, or listen via telephone by
dialing 913-312-1235.
Goodrich Corporation, a Fortune 500 company, is a global supplier of systems and services to
aerospace, defense and homeland security markets. With one of the most strategically diversified
portfolios of products in the industry, Goodrich serves a global customer base with significant
worldwide manufacturing and service facilities. For more information visit
http://www.goodrich.com.
Page 7
FORWARD-LOOKING INFORMATION IS SUBJECT TO RISK AND UNCERTAINTY
Certain statements made in this document are forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995 regarding our future plans, objectives and
expected performance. Specifically, statements that are not historical facts, including statements
accompanied by words such as believe, expect, anticipate, intend, should, estimate, or
plan, are intended to identify forward-looking statements and convey the uncertainty of future
events or outcomes. We caution readers that any such forward-looking statements are based on
assumptions that we believe are reasonable, but are subject to a wide range of risks, and actual
results may differ materially.
Important factors that could cause actual results to differ from expected performance include, but
are not limited to:
| demand for and market acceptance of new and existing products, such as the Airbus A350
XWB and A380, the Boeing 787 Dreamliner, the EMBRAER 190, the Mitsubishi Regional Jet
(MRJ), the Bombardier CSeries, the Dassault Falcon 7X, the Lockheed Martin F-35 Lightning
II and the Northrop Grumman Joint STARS re-engining program; |
| our ability to extend our commercial OE contracts beyond the initial contract periods; |
| cancellation or delays of orders or contracts by customers or with suppliers, including
delays or cancellations associated with the Boeing 787 Dreamliner, the Airbus A380 and A350
XWB aircraft programs, and major military programs; |
| our ability to obtain price adjustments pursuant to certain of our long-term contracts; |
| the financial viability of key suppliers and the ability of our suppliers to perform
under existing contracts; |
| successful development of products and advanced technologies; |
| the health of the commercial aerospace industry, including the impact of bankruptcies
and/or consolidations in the airline industry; |
| global demand for aircraft spare parts and aftermarket services; |
| changing priorities or reductions in the defense budgets in the U.S. and other
countries, U.S. foreign policy and the level of activity in military flight operations; |
| the possibility of restructuring and consolidation actions; |
| threats and events associated with and efforts to combat terrorism; |
| the extent to which expenses relating to employee and retiree medical and pension
benefits change; |
Page 8
| competitive product and pricing pressures; |
| our ability to recover under contractual rights of indemnification for environmental and
other claims arising out of the divestiture of our tire, vinyl and other businesses; |
| possible assertion of claims against us on the theory that we, as the former corporate
parent of Coltec Industries Inc, bear some responsibility for the asbestos-related
liabilities of Coltec and its subsidiaries; |
| the effect of changes in accounting policies or tax legislation; |
| cumulative catch-up adjustments or loss contract reserves on long-term contracts
accounted for under the percentage of completion method of accounting; |
| domestic and foreign government spending, budgetary and trade policies; |
| economic and political changes in international markets where we compete, such as
changes in currency exchange rates, inflation, fuel prices, deflation, recession and other
external factors over which we have no control; |
| the outcome of contingencies including completion of acquisitions, divestitures, tax
audits, litigation and environmental remediation efforts; and |
| the impact of labor difficulties or work stoppages at our, a customers or a suppliers
facilities |
We caution you not to place undue reliance on the forward-looking statements contained in this
document, which speak only as of the date on which such statements are made. We undertake no
obligation to release publicly any revisions to these forward-looking statements to reflect events
or circumstances after the date on which such statements were made or to reflect the occurrence of
unanticipated events.
Page 9
Supplemental Data
Segment Review
Quarter Ended September 30, 2009 Compared with Quarter Ended September 30, 2008
Quarter Ended September 30, | ||||||||||||||||||||
% | % of Sales | |||||||||||||||||||
2009 | 2008 | Change | 2009 | 2008 | ||||||||||||||||
(Dollars in millions) | ||||||||||||||||||||
NET CUSTOMER SALES |
||||||||||||||||||||
Actuation and Landing Systems |
$ | 629.3 | $ | 664.2 | (5 | %) | ||||||||||||||
Nacelles and Interior Systems |
$ | 561.8 | $ | 596.5 | (6 | %) | ||||||||||||||
Electronic Systems |
$ | 456.6 | $ | 511.6 | (11 | %) | ||||||||||||||
Total Sales |
$ | 1,647.7 | $ | 1,772.3 | (7 | %) | ||||||||||||||
SEGMENT OPERATING INCOME |
||||||||||||||||||||
Actuation and Landing Systems |
$ | 59.7 | $ | 80.0 | (25 | %) | 9.5 | % | 12.0 | % | ||||||||||
Nacelles and Interior Systems |
$ | 130.8 | $ | 162.4 | (19 | %) | 23.3 | % | 27.2 | % | ||||||||||
Electronic Systems |
$ | 70.4 | $ | 79.3 | (11 | %) | 15.4 | % | 15.5 | % | ||||||||||
Segment Operating Income |
$ | 260.9 | $ | 321.7 | (19 | %) | 15.8 | % | 18.2 | % |
Actuation and Landing Systems: Actuation and Landing Systems segment sales for the third quarter
2009 decreased from the third quarter 2008 primarily due to the following:
| Lower large commercial, regional, business and general aviation airplane aftermarket
sales across all businesses of approximately $40 million; |
| Lower regional, business and general aviation airplane OE sales across all businesses of
approximately $21 million; and |
| Lower other non-aerospace OE and aftermarket sales of approximately $4 million,
primarily in our engine components business; partially offset by |
| Higher defense and space OE and aftermarket sales, across all businesses, of
approximately $19 million; and |
| Higher large commercial airplane OE sales of approximately $16 million, primarily in our
landing gear and actuation systems businesses. |
Page 10
Actuation and Landing Systems segment operating income for the third quarter 2009 decreased from
the third quarter 2008 primarily as a result of the following:
| Lower income of approximately $17 million related to changes in estimates for certain
long-term contracts in our wheels and brakes business that were more favorable in 2008; |
| Lower sales volume and unfavorable product mix across most businesses, resulting in
lower income of approximately $16 million; and |
| Unfavorable foreign exchange of approximately $8 million; partially offset by |
| Favorable pricing and lower operating costs across most businesses, partially offset by
higher pension expense, which resulted in higher income of approximately $21 million. |
Nacelles and Interior Systems: Nacelles and Interior Systems segment sales for the third quarter
2009 decreased from the third quarter 2008 primarily due to the following:
| Lower large commercial, regional, business and general aviation airplane aftermarket
sales of approximately $57 million, primarily in our aerostructures and interiors
businesses; and |
| Lower regional, business, and general aviation airplane OE sales of approximately $15
million, primarily in our aerostructures and interiors businesses; partially offset by; |
| Higher large commercial airplane OE sales of approximately $40 million, primarily in our
aerostructures business. |
Nacelles and Interior Systems segment operating income for the third quarter 2009 decreased from
the third quarter 2008 primarily due to the following:
| Lower sales volume and unfavorable product mix, primarily in our interiors and
aerostructures businesses, which resulted in lower income of approximately $37 million; and |
| Lower income of approximately $8 million related to changes in estimates for certain
long-term contracts in our aerostructures business that were more favorable in 2008;
partially offset by |
| Favorable pricing, partially offset by higher operating costs, across most businesses,
including higher pension and restructuring expenses, which resulted in higher income of
approximately $13 million. |
Page 11
Electronic Systems: Electronic Systems segment sales for the third quarter 2009 decreased from the
third quarter 2008 primarily due to the following:
| Lower engine controls sales of approximately $34 million which are no longer being
reported by Goodrich. Sales in 2009 are recorded by the engine controls joint venture (JV)
with Rolls-Royce that was formed in the fourth quarter of 2008; |
| Lower regional, business and general aviation airplane OE sales of approximately $25
million, primarily in our engine controls and electrical power business; and |
| Lower large commercial, regional, business and general aviation airplane aftermarket
sales of approximately $20 million, primarily in our sensors and integrated systems, engine
controls and electrical power businesses; partially offset by |
| Higher defense and space sales across all of our businesses of approximately $28
million, including sales of approximately $3 million associated with the acquisition of
Cloud Cap Technologies, Inc. (Cloud Cap), which occurred in the second quarter of 2009. |
Electronic Systems segment operating income for the third quarter 2009 decreased from the third
quarter 2008 primarily due to the following:
| Lower sales volume and unfavorable product mix across most businesses, which resulted in
lower income of approximately $22 million; partially offset by |
| Favorable pricing and lower operating costs across most businesses, partially offset by
higher pension and restructuring expenses, which resulted in higher income of $8 million;
and |
| The favorable effect of the JV on the segments operating income of approximately $5
million. Goodrich recorded its portion of the JVs 2009 operating results in other income
(expense) net. |
Page 12
PRELIMINARY
GOODRICH CORPORATION
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
(DOLLARS IN MILLIONS EXCEPT PER SHARE AMOUNTS)
GOODRICH CORPORATION
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
(DOLLARS IN MILLIONS EXCEPT PER SHARE AMOUNTS)
Three Months | Nine Months | |||||||||||||||
Ended | Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Sales |
$ | 1,647.7 | $ | 1,772.3 | $ | 5,043.3 | $ | 5,366.6 | ||||||||
Operating costs and expenses: |
||||||||||||||||
Cost of sales |
1,169.2 | 1,214.9 | 3,553.2 | 3,715.2 | ||||||||||||
Selling and administrative costs |
249.6 | 260.6 | 752.0 | 791.6 | ||||||||||||
1,418.8 | 1,475.5 | 4,305.2 | 4,506.8 | |||||||||||||
Operating Income |
228.9 | 296.8 | 738.1 | 859.8 | ||||||||||||
Interest expense |
(30.7 | ) | (26.7 | ) | (90.2 | ) | (85.2 | ) | ||||||||
Interest income |
0.3 | 1.4 | 1.0 | 5.1 | ||||||||||||
Other income (expense) net |
(7.9 | ) | (5.6 | ) | (18.7 | ) | (18.4 | ) | ||||||||
Income from continuing operations before income taxes |
190.6 | 265.9 | 630.2 | 761.3 | ||||||||||||
Income tax expense |
(45.7 | ) | (94.1 | ) | (162.4 | ) | (242.5 | ) | ||||||||
Income From Continuing Operations |
144.9 | 171.8 | 467.8 | 518.8 | ||||||||||||
Income from discontinued operations net of income
taxes |
3.3 | 0.2 | 35.0 | 7.5 | ||||||||||||
Consolidated Net Income |
148.2 | 172.0 | 502.8 | 526.3 | ||||||||||||
Net income attributable to noncontrolling interests |
(2.8 | ) | (4.0 | ) | (10.5 | ) | (13.8 | ) | ||||||||
Net Income Attributable to Goodrich |
$ | 145.4 | $ | 168.0 | $ | 492.3 | $ | 512.5 | ||||||||
Amounts attributable to Goodrich: |
||||||||||||||||
Income from continuing operations |
$ | 142.1 | $ | 167.8 | $ | 457.3 | $ | 505.0 | ||||||||
Income from discontinued operations net of income
taxes |
3.3 | 0.2 | 35.0 | 7.5 | ||||||||||||
Net Income Attributable to Goodrich |
$ | 145.4 | $ | 168.0 | $ | 492.3 | $ | 512.5 | ||||||||
Earnings per common share attributable to Goodrich: |
||||||||||||||||
Basic Earnings per Share: |
||||||||||||||||
Continuing operations |
$ | 1.13 | $ | 1.33 | $ | 3.64 | $ | 3.99 | ||||||||
Discontinued operations |
0.02 | | 0.28 | 0.06 | ||||||||||||
Net Income Attributable to Goodrich |
$ | 1.15 | $ | 1.33 | $ | 3.92 | $ | 4.05 | ||||||||
Diluted Earnings per Share: |
||||||||||||||||
Continuing operations |
$ | 1.12 | $ | 1.32 | $ | 3.61 | $ | 3.95 | ||||||||
Discontinued operations |
0.02 | | 0.27 | 0.06 | ||||||||||||
Net Income Attributable to Goodrich |
$ | 1.14 | $ | 1.32 | $ | 3.88 | $ | 4.01 | ||||||||
Dividends Declared per Common Share |
$ | 0.25 | $ | 0.225 | $ | 0.75 | $ | 0.675 | ||||||||
Page 13
PRELIMINARY
GOODRICH CORPORATION
SEGMENT REPORTING (UNAUDITED)
(DOLLARS IN MILLIONS EXCEPT PER SHARE AMOUNTS)
GOODRICH CORPORATION
SEGMENT REPORTING (UNAUDITED)
(DOLLARS IN MILLIONS EXCEPT PER SHARE AMOUNTS)
Three Months | Nine Months | |||||||||||||||
Ended | Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Sales: |
||||||||||||||||
Actuation and Landing Systems |
$ | 629.3 | $ | 664.2 | $ | 1,879.2 | $ | 2,035.9 | ||||||||
Nacelles and Interior Systems |
561.8 | 596.5 | 1,789.2 | 1,882.1 | ||||||||||||
Electronic Systems |
456.6 | 511.6 | 1,374.9 | 1,448.6 | ||||||||||||
Total Sales |
$ | 1,647.7 | $ | 1,772.3 | $ | 5,043.3 | $ | 5,366.6 | ||||||||
Operating Income: |
||||||||||||||||
Actuation and Landing Systems |
$ | 59.7 | $ | 80.0 | $ | 198.6 | $ | 238.6 | ||||||||
Nacelles and Interior Systems |
130.8 | 162.4 | 414.7 | 501.9 | ||||||||||||
Electronic Systems |
70.4 | 79.3 | 211.4 | 199.8 | ||||||||||||
Total Segment Operating Income (1) |
260.9 | 321.7 | 824.7 | 940.3 | ||||||||||||
Corporate General and Administrative Costs |
(28.0 | ) | (21.1 | ) | (75.2 | ) | (67.8 | ) | ||||||||
ERP Implementation Costs |
(4.0 | ) | (3.8 | ) | (11.4 | ) | (12.7 | ) | ||||||||
Total Operating Income |
$ | 228.9 | $ | 296.8 | $ | 738.1 | $ | 859.8 | ||||||||
Segment Operating Income as a Percent of Sales: |
||||||||||||||||
Actuation and Landing Systems |
9.5 | % | 12.0 | % | 10.6 | % | 11.7 | % | ||||||||
Nacelles and Interior Systems |
23.3 | % | 27.2 | % | 23.2 | % | 26.7 | % | ||||||||
Electronic Systems |
15.4 | % | 15.5 | % | 15.4 | % | 13.8 | % | ||||||||
Total Segment Operating Income as a Percent of Sales |
15.8 | % | 18.2 | % | 16.4 | % | 17.5 | % |
(1) | Segment operating income is total segment revenue reduced by operating expenses directly
identifiable with our business segments except for certain enterprise ERP implementation expenses
which were not allocated to the segments. Segment operating income is used by management to assess
the operating performance of the segments. See reconciliation of total segment operating income to
total operating income above. |
Three Months | Nine Months | |||||||||||||||
Ended | Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Numerator |
||||||||||||||||
Income from continuing operations
attributable to Goodrich |
$ | 142.1 | $ | 167.8 | $ | 457.3 | $ | 505.0 | ||||||||
Percentage allocated to common shareholders |
98.6 | % | 98.6 | % | 98.6 | % | 98.6 | % | ||||||||
$ | 140.0 | $ | 165.5 | $ | 450.8 | $ | 497.9 | |||||||||
Denominator |
||||||||||||||||
Weighted-average shares |
124.1 | 124.4 | 124.0 | 124.9 | ||||||||||||
Effect of dilutive securities |
1.4 | 1.0 | 1.0 | 1.3 | ||||||||||||
Adjusted weighted-average shares and assumed
conversion |
125.5 | 125.4 | 125.0 | 126.2 | ||||||||||||
Per share income from continuing operations |
||||||||||||||||
Basic |
$ | 1.13 | $ | 1.33 | $ | 3.64 | $ | 3.99 | ||||||||
Diluted |
$ | 1.12 | $ | 1.32 | $ | 3.61 | $ | 3.95 | ||||||||
Page 14
PRELIMINARY
GOODRICH CORPORATION
CONSOLIDATED BALANCE SHEET (UNAUDITED)
(DOLLARS IN MILLIONS EXCEPT SHARE AMOUNTS)
GOODRICH CORPORATION
CONSOLIDATED BALANCE SHEET (UNAUDITED)
(DOLLARS IN MILLIONS EXCEPT SHARE AMOUNTS)
September 30, | December 31, | |||||||
2009 | 2008 | |||||||
Current Assets |
||||||||
Cash and cash equivalents |
$ | 789.6 | $ | 370.3 | ||||
Accounts and notes receivable net |
1,127.8 | 1,048.9 | ||||||
Inventories net |
2,181.9 | 1,974.7 | ||||||
Deferred income taxes |
144.6 | 153.5 | ||||||
Prepaid expenses and other assets |
63.9 | 47.2 | ||||||
Income taxes receivable |
18.0 | 73.7 | ||||||
Total Current Assets |
4,325.8 | 3,668.3 | ||||||
Property, plant and equipment net |
1,390.8 | 1,391.4 | ||||||
Prepaid pension |
0.7 | 0.6 | ||||||
Goodwill |
1,423.1 | 1,390.2 | ||||||
Identifiable intangible assets net |
411.6 | 402.8 | ||||||
Deferred income taxes |
93.7 | 92.0 | ||||||
Other assets |
627.7 | 537.6 | ||||||
Total Assets |
$ | 8,273.4 | $ | 7,482.9 | ||||
Current Liabilities |
||||||||
Short-term debt |
$ | 36.7 | $ | 37.7 | ||||
Accounts payable |
562.6 | 646.4 | ||||||
Accrued expenses |
949.1 | 1,005.3 | ||||||
Income taxes payable |
96.1 | 5.6 | ||||||
Deferred income taxes |
25.0 | 25.0 | ||||||
Current maturities of long-term debt and capital lease obligations |
0.5 | 121.3 | ||||||
Total Current Liabilities |
1,670.0 | 1,841.3 | ||||||
Long-term debt and capital lease obligations |
1,708.7 | 1,410.4 | ||||||
Pension obligations |
884.6 | 973.9 | ||||||
Postretirement benefits other than pensions |
275.8 | 309.4 | ||||||
Long-term income taxes payable |
164.2 | 172.3 | ||||||
Deferred income taxes |
131.3 | 62.3 | ||||||
Other non-current liabilities |
495.2 | 561.1 | ||||||
Shareholders Equity |
||||||||
Common stock $5 par value |
||||||||
Authorized 200,000,000 shares; issued 144,958,814 shares at
September 30, 2009 and 143,611,254 shares at December 31, 2008
(excluding 14,000,000 shares held by a wholly owned subsidiary) |
724.8 | 718.1 | ||||||
Additional paid-in capital |
1,577.8 | 1,525.3 | ||||||
Income retained in the business |
2,017.1 | 1,619.2 | ||||||
Accumulated other comprehensive income (loss) |
(638.8 | ) | (978.1 | ) | ||||
Common stock held in treasury, at cost (20,601,534 shares at
September 30, 2009 and 20,410,556 shares at December 31, 2008) |
(800.9 | ) | (793.2 | ) | ||||
Total Shareholders Equity |
2,880.0 | 2,091.3 | ||||||
Noncontrolling interests |
63.6 | 60.9 | ||||||
Total Equity |
2,943.6 | 2,152.2 | ||||||
Total Liabilities And Equity |
$ | 8,273.4 | $ | 7,482.9 | ||||
Page 15
PRELIMINARY
GOODRICH CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
(DOLLARS IN MILLIONS)
GOODRICH CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
(DOLLARS IN MILLIONS)
Three Months | Nine Months | |||||||||||||||
Ended | Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Operating Activities |
||||||||||||||||
Consolidated net income |
$ | 148.2 | $ | 172.0 | $ | 502.8 | $ | 526.3 | ||||||||
Adjustments to reconcile consolidated net income to net cash provided by
operating activities: |
||||||||||||||||
Income from discontinued operations |
(3.3 | ) | (0.2 | ) | (35.0 | ) | (7.5 | ) | ||||||||
Restructuring and consolidation: |
||||||||||||||||
Expenses |
7.8 | 0.7 | 15.6 | 1.3 | ||||||||||||
Payments |
(5.1 | ) | (0.6 | ) | (10.1 | ) | (1.7 | ) | ||||||||
Pension and postretirement benefits: |
||||||||||||||||
Expenses |
50.9 | 25.5 | 149.1 | 76.9 | ||||||||||||
Contributions and benefit payments |
(23.6 | ) | (89.0 | ) | (202.5 | ) | (124.2 | ) | ||||||||
Depreciation and amortization |
61.5 | 64.8 | 185.1 | 192.0 | ||||||||||||
Excess tax benefits related to share-based payment arrangements |
(2.4 | ) | (0.3 | ) | (3.3 | ) | (8.4 | ) | ||||||||
Share-based compensation expense |
13.5 | 9.8 | 45.1 | 25.5 | ||||||||||||
Deferred income taxes |
8.3 | 1.7 | 12.1 | (9.0 | ) | |||||||||||
Change in assets and liabilities, net of effects of acquisitions and divestitures: |
||||||||||||||||
Receivables |
23.6 | 26.0 | (44.1 | ) | (149.1 | ) | ||||||||||
Inventories, net of pre-production and excess-over-average |
13.9 | (74.0 | ) | (28.0 | ) | (144.4 | ) | |||||||||
Pre-production and excess-over-average inventories |
(48.3 | ) | (26.8 | ) | (124.9 | ) | (83.3 | ) | ||||||||
Other current assets |
(0.6 | ) | (3.2 | ) | 1.0 | (2.8 | ) | |||||||||
Accounts payable |
(64.6 | ) | 2.9 | (99.8 | ) | 107.9 | ||||||||||
Accrued expenses |
50.1 | 21.4 | (53.9 | ) | (55.5 | ) | ||||||||||
Income taxes payable/receivable |
9.8 | 28.8 | 135.7 | 151.2 | ||||||||||||
Other non-current assets and liabilities |
12.8 | (18.2 | ) | (17.9 | ) | (34.4 | ) | |||||||||
Net Cash Provided By Operating Activities |
252.5 | 141.3 | 427.0 | 460.8 | ||||||||||||
Investing Activities |
||||||||||||||||
Purchases of property, plant and equipment |
(41.8 | ) | (73.3 | ) | (115.0 | ) | (189.6 | ) | ||||||||
Proceeds from sale of property, plant and equipment |
0.4 | 0.1 | 1.3 | 2.8 | ||||||||||||
Payments made for acquisitions, net of cash acquired |
(0.1 | ) | (38.2 | ) | (29.9 | ) | (131.8 | ) | ||||||||
Investments in and advances to equity investees |
(0.5 | ) | | (1.5 | ) | | ||||||||||
Net Cash Used In Investing Activities |
(42.0 | ) | (111.4 | ) | (145.1 | ) | (318.6 | ) | ||||||||
Financing Activities |
||||||||||||||||
Increase (decrease) in short-term debt, net |
(4.2 | ) | 92.2 | (1.5 | ) | 90.6 | ||||||||||
Proceeds (repayments) of long-term debt and capital lease obligations |
(0.1 | ) | (0.4 | ) | 177.4 | (198.1 | ) | |||||||||
Proceeds from issuance of common stock |
11.1 | 0.2 | 26.4 | 24.2 | ||||||||||||
Purchases of treasury stock |
(0.8 | ) | (100.9 | ) | (7.8 | ) | (138.3 | ) | ||||||||
Dividends paid |
(31.6 | ) | (28.7 | ) | (94.1 | ) | (85.7 | ) | ||||||||
Excess tax benefits related to share-based payment arrangements |
2.4 | 0.3 | 3.3 | 8.4 | ||||||||||||
Distributions to noncontrolling interests |
(0.5 | ) | (0.5 | ) | (7.8 | ) | (6.8 | ) | ||||||||
Net Cash Provided By (Used In) Financing Activities |
(23.7 | ) | (37.8 | ) | 95.9 | (305.7 | ) | |||||||||
Discontinued Operations |
||||||||||||||||
Net cash provided by (used in) operating activities |
(15.4 | ) | (0.3 | ) | 34.2 | (2.6 | ) | |||||||||
Net cash provided by (used in) investing activities |
| (0.1 | ) | | 15.7 | |||||||||||
Net cash provided by (used in) financing activities |
| | | | ||||||||||||
Net cash provided by discontinued operations |
(15.4 | ) | (0.4 | ) | 34.2 | 13.1 | ||||||||||
Effect of exchange rate changes on cash and cash equivalents |
(1.2 | ) | (10.3 | ) | 7.3 | (8.7 | ) | |||||||||
Net increase (decrease) in cash and cash equivalents |
170.2 | (18.6 | ) | 419.3 | (159.1 | ) | ||||||||||
Cash and cash equivalents at beginning of period |
619.4 | 265.5 | 370.3 | 406.0 | ||||||||||||
Cash and cash equivalents at end of period |
$ | 789.6 | $ | 246.9 | $ | 789.6 | $ | 246.9 | ||||||||
Page 16
PRELIMINARY
GOODRICH CORPORATION
SUPPLEMENTARY FINANCIAL INFORMATION (UNAUDITED)
(DOLLARS IN MILLIONS)
GOODRICH CORPORATION
SUPPLEMENTARY FINANCIAL INFORMATION (UNAUDITED)
(DOLLARS IN MILLIONS)
Three Months | Nine Months | |||||||||||||||
Ended | Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Preliminary Income Statement Data: |
||||||||||||||||
Net Interest Expense |
$ | (30.4 | ) | $ | (25.3 | ) | $ | (89.2 | ) | $ | (80.1 | ) | ||||
Other Income (Expense), Net: |
$ | (7.9 | ) | $ | (5.6 | ) | $ | (18.7 | ) | $ | (18.4 | ) | ||||
- Divested business retiree health care |
(3.0 | ) | (3.8 | ) | (9.1 | ) | (14.6 | ) | ||||||||
- Income (expense) related to
previously owned businesses |
(1.2 | ) | (2.1 | ) | (3.4 | ) | (5.9 | ) | ||||||||
- Equity in affiliated companies |
(4.3 | ) | 0.5 | (6.3 | ) | 1.5 | ||||||||||
- Other Income (expense) |
0.6 | (0.2 | ) | 0.1 | 0.6 | |||||||||||
Preliminary Cash Flow Data: |
||||||||||||||||
Dividends |
$ | (31.6 | ) | $ | (28.7 | ) | $ | (94.1 | ) | $ | (85.7 | ) | ||||
Depreciation and Amortization |
$ | 61.5 | $ | 64.8 | $ | 185.1 | $ | 192.0 | ||||||||
- Depreciation |
44.3 | 45.5 | 133.8 | 135.9 | ||||||||||||
- Amortization |
17.2 | 19.3 | 51.3 | 56.1 |
September 30, | December 31, | |||||||
2009 | 2008 | |||||||
Preliminary Balance Sheet Data: |
||||||||
Preproduction and Excess-Over-Average Inventory |
$ | 764.6 | $ | 633.1 | ||||
Short-term Debt |
$ | 36.7 | $ | 37.7 | ||||
Current Maturities of Long-term Debt and
Capital Lease Obligations |
0.5 | 121.3 | ||||||
Long-term Debt and Capital Lease Obligations |
1,708.7 | 1,410.4 | ||||||
Total Debt[1] |
$ | 1,745.9 | $ | 1,569.4 | ||||
Cash and Cash Equivalents |
789.6 | 370.3 | ||||||
Net Debt[1] |
$ | 956.3 | $ | 1,199.1 | ||||
[1] | Total Debt (defined as short-term debt plus current maturities of long-term debt and
capital lease obligations plus long-term debt and capital lease obligations) and Net Debt (defined
as Total Debt minus cash and cash equivalents) are non-GAAP financial measures that the Company
believes are useful to rating agencies and investors in understanding the Companys capital
structure and leverage. Because all companies do not calculate these measures in the same manner,
the Companys presentation may not be comparable to other similarly titled measures reported by
other companies. |
Page 17