Delaware
|
52-2314475
|
(State
or other jurisdiction
|
(I.R.S.
Employer
|
of
incorporation or organization)
|
Identification
No.)
|
400
Collins Road NE
|
52498
|
Cedar
Rapids, Iowa
|
(Zip
Code)
|
(Address
of principal executive offices)
|
Page No.
|
|||
PART
I.
|
FINANCIAL
INFORMATION:
|
||
Item
1.
|
Condensed
Consolidated Financial Statements:
|
||
Condensed
Consolidated Statement of Financial Position (Unaudited) —
|
|||
June
30, 2008 and September 30, 2007
|
2
|
||
Condensed
Consolidated Statement of Operations (Unaudited) —
|
|||
Three
and Nine Months Ended June 30, 2008 and 2007
|
3
|
||
Condensed
Consolidated Statement of Cash Flows (Unaudited) —
|
|||
Nine
Months Ended June 30, 2008 and 2007
|
4
|
||
Notes
to Condensed Consolidated Financial Statements (Unaudited)
|
5
|
||
Item
2.
|
Management's
Discussion and Analysis of Financial Condition and Results of
Operations
|
18
|
|
Item
3.
|
Quantitative
and Qualitative Disclosures about Market Risk
|
27
|
|
Item
4.
|
Controls
and Procedures
|
27
|
|
PART II.
|
OTHER
INFORMATION:
|
||
Item
2.
|
Unregistered
Sales of Equity Securities and Use of Proceeds
|
28
|
|
Item 6.
|
Exhibits
|
29
|
|
Signatures
|
30
|
June 30,
|
|
September 30,
|
|
||||
|
|
2008
|
|
2007
|
|||
ASSETS
|
|||||||
Current
Assets:
|
|||||||
Cash
and cash equivalents
|
$
|
187
|
$
|
231
|
|||
Receivables
|
911
|
883
|
|||||
Inventories
|
960
|
823
|
|||||
Current
deferred income taxes
|
158
|
176
|
|||||
Other
current assets
|
69
|
56
|
|||||
Total
current assets
|
2,285
|
2,169
|
|||||
Property
|
637
|
607
|
|||||
Intangible
Assets
|
196
|
147
|
|||||
Goodwill
|
622
|
544
|
|||||
Prepaid
Pension Asset
|
120
|
88
|
|||||
Other
Assets
|
255
|
195
|
|||||
TOTAL
ASSETS
|
$
|
4,115
|
$
|
3,750
|
|||
LIABILITIES
AND SHAREOWNERS' EQUITY
|
|||||||
Current
Liabilities:
|
|||||||
Short-term
debt
|
$
|
429
|
$
|
-
|
|||
Accounts
payable
|
368
|
395
|
|||||
Compensation
and benefits
|
274
|
305
|
|||||
Advance
payments from customers
|
299
|
304
|
|||||
Product
warranty costs
|
225
|
213
|
|||||
Income
taxes payable
|
1
|
29
|
|||||
Other
current liabilities
|
198
|
213
|
|||||
Total
current liabilities
|
1,794
|
1,459
|
|||||
Long-Term
Debt
|
228
|
223
|
|||||
Retirement
Benefits
|
364
|
359
|
|||||
Other
Liabilities
|
153
|
136
|
|||||
Shareowners'
Equity:
|
|||||||
Common
stock ($0.01 par value; shares authorized: 1,000; shares issued:
183.8)
|
2
|
2
|
|||||
Additional
paid-in capital
|
1,372
|
1,353
|
|||||
Retained
earnings
|
1,922
|
1,533
|
|||||
Accumulated
other comprehensive loss
|
(319
|
)
|
(336
|
)
|
|||
Common
stock in treasury, at cost (shares held: June 30, 2008, 24.1; September
30, 2007, 18.0)
|
(1,401
|
)
|
(979
|
)
|
|||
Total
shareowners' equity
|
1,576
|
1,573
|
|||||
TOTAL
LIABILITIES AND SHAREOWNERS’ EQUITY
|
$
|
4,115
|
$
|
3,750
|
Three Months Ended
|
Nine Months Ended
|
||||||||||||
June 30
|
June 30
|
||||||||||||
2008
|
2007
|
2008
|
2007
|
||||||||||
Sales:
|
|||||||||||||
Product
sales
|
$
|
1,086
|
$
|
1,011
|
$
|
3,170
|
$
|
2,886
|
|||||
Service
sales
|
108
|
102
|
322
|
303
|
|||||||||
Total
sales
|
1,194
|
1,113
|
3,492
|
3,189
|
|||||||||
Costs,
expenses and other:
|
|||||||||||||
Product
cost of sales
|
754
|
710
|
2,218
|
2,022
|
|||||||||
Service
cost of sales
|
73
|
70
|
218
|
204
|
|||||||||
Selling,
general, and administrative expenses
|
119
|
124
|
350
|
352
|
|||||||||
Interest
expense
|
5
|
3
|
15
|
10
|
|||||||||
Other
income, net
|
(5
|
)
|
(3
|
)
|
(21
|
)
|
(13
|
)
|
|||||
Total
costs, expenses and other
|
946
|
904
|
2,780
|
2,575
|
|||||||||
Income
before income taxes
|
248
|
209
|
712
|
614
|
|||||||||
Income
tax provision
|
74
|
63
|
216
|
185
|
|||||||||
Net
income
|
$
|
174
|
$
|
146
|
$
|
496
|
$
|
429
|
|||||
Earnings
per share:
|
|||||||||||||
Basic
|
$
|
1.09
|
$
|
0.87
|
$
|
3.07
|
$
|
2.56
|
|||||
Diluted
|
$
|
1.07
|
$
|
0.86
|
$
|
3.03
|
$
|
2.52
|
|||||
Weighted
average common shares:
|
|||||||||||||
Basic
|
160.3
|
167.0
|
161.5
|
167.5
|
|||||||||
Diluted
|
162.4
|
169.6
|
163.7
|
170.1
|
|||||||||
Cash
dividends per share
|
$
|
0.24
|
$
|
0.16
|
$
|
0.56
|
$
|
0.48
|
Nine Months Ended
|
|||||||
June 30
|
|||||||
2008
|
2007
|
||||||
Operating
Activities:
|
|||||||
Net
income
|
$
|
496
|
$
|
429
|
|||
Adjustments
to arrive at cash provided by operating activities:
|
|||||||
Depreciation
|
76
|
71
|
|||||
Amortization
of intangible assets
|
18
|
16
|
|||||
Stock-based
compensation
|
15
|
13
|
|||||
Compensation
and benefits paid in common stock
|
46
|
42
|
|||||
Tax
benefit from the exercise of stock options
|
7
|
29
|
|||||
Excess
tax benefit from stock-based compensation
|
(7
|
)
|
(29
|
)
|
|||
Deferred
income taxes
|
17
|
3
|
|||||
Pension
plan contributions
|
(11
|
)
|
(85
|
)
|
|||
Changes
in assets and liabilities, excluding effects of acquisitions
and foreign currency adjustments:
|
|||||||
Receivables
|
(60
|
)
|
(106
|
)
|
|||
Inventories
|
(161
|
)
|
(163
|
)
|
|||
Accounts
payable
|
(12
|
)
|
22
|
||||
Advance
payments from customers
|
(6
|
)
|
70
|
||||
Compensation
and benefits
|
(31
|
)
|
24
|
||||
Income
taxes
|
(53
|
)
|
(27
|
)
|
|||
Other
assets and liabilities
|
(24
|
)
|
(11
|
)
|
|||
Cash
Provided by Operating Activities
|
310
|
298
|
|||||
Investing
Activities:
|
|||||||
Property
additions
|
(114
|
)
|
(86
|
)
|
|||
Acquisition
of intangible assets
|
(6
|
)
|
(3
|
)
|
|||
Acquisition
of businesses, net of cash acquired
|
(107
|
)
|
-
|
||||
Proceeds
from settlement of discontinued license agreement
|
-
|
14
|
|||||
Proceeds
from purchase price settlement related to business
acquisition
|
-
|
5
|
|||||
Other
investing activities
|
1
|
(1
|
)
|
||||
Cash
Used for Investing Activities
|
(226
|
)
|
(71
|
)
|
|||
Financing
Activities:
|
|||||||
Purchases
of treasury stock
|
(492
|
)
|
(222
|
)
|
|||
Cash
dividends
|
(91
|
)
|
(81
|
)
|
|||
Increase
in short-term borrowings
|
429
|
4
|
|||||
Decrease
in long-term borrowings
|
-
|
(27
|
)
|
||||
Proceeds
from exercise of stock options
|
16
|
56
|
|||||
Excess
tax benefit from stock-based compensation
|
7
|
29
|
|||||
Cash
Used for Financing Activities
|
(131
|
)
|
(241
|
)
|
|||
Effect
of exchange rate changes on cash and cash equivalents
|
3
|
5
|
|||||
Net
Change in Cash and Cash Equivalents
|
(44
|
)
|
(9
|
)
|
|||
Cash
and Cash Equivalents at Beginning of Period
|
231
|
144
|
|||||
Cash
and Cash Equivalents at End of Period
|
$
|
187
|
$
|
135
|
1.
|
Business
Description and Basis of
Presentation
|
2.
|
New
Accounting Standards
|
3.
|
Acquisitions
|
4.
|
Receivables
|
June 30,
|
September 30,
|
||||||
2008
|
2007
|
||||||
Billed
|
$
|
750
|
$
|
715
|
|||
Unbilled
|
193
|
207
|
|||||
Less
progress payments
|
(23
|
)
|
(30
|
)
|
|||
Total
|
920
|
892
|
|||||
Less
allowance for doubtful accounts
|
(9
|
)
|
(9
|
)
|
|||
Receivables
|
$
|
911
|
$
|
883
|
5.
|
Inventories
|
June 30,
|
September 30,
|
||||||
2008
|
2007
|
||||||
Finished
goods
|
$
|
209
|
$
|
187
|
|||
Work
in process
|
448
|
362
|
|||||
Raw
materials, parts, and supplies
|
384
|
371
|
|||||
Total
|
1,041
|
920
|
|||||
Less
progress payments
|
(81
|
)
|
(97
|
)
|
|||
Inventories
|
$
|
960
|
$
|
823
|
6.
|
Property
|
June 30,
|
September 30,
|
||||||
2008
|
2007
|
||||||
Land
|
$
|
31
|
$
|
31
|
|||
Buildings
and improvements
|
310
|
307
|
|||||
Machinery
and equipment
|
799
|
769
|
|||||
Information
systems software and hardware
|
233
|
224
|
|||||
Furniture
and fixtures
|
53
|
52
|
|||||
Construction
in progress
|
104
|
72
|
|||||
Total
|
1,530
|
1,455
|
|||||
Less
accumulated depreciation
|
(893
|
)
|
(848
|
)
|
|||
Property
|
$
|
637
|
$
|
607
|
7. |
Goodwill
and Intangible Assets
|
Government
|
|
Commercial
|
|
|
|
|||||
|
|
Systems
|
|
Systems
|
|
Total
|
||||
Balance
at September 30, 2007
|
$
|
353
|
$
|
191
|
$
|
544
|
||||
Athena
acquisition
|
72
|
-
|
72
|
|||||||
Foreign
currency translation adjustment
|
5
|
-
|
5
|
|||||||
Other
adjustments to goodwill
|
1
|
-
|
1
|
|||||||
Balance
at June 30, 2008
|
$
|
431
|
$
|
191
|
$
|
622
|
June 30, 2008
|
September 30, 2007
|
||||||||||||||||||
Accum
|
Accum
|
||||||||||||||||||
Gross
|
Amort
|
Net
|
Gross
|
Amort
|
Net
|
||||||||||||||
Intangible
assets with finite lives:
|
|||||||||||||||||||
Developed
technology and patents
|
$
|
175
|
$
|
(83
|
)
|
$
|
92
|
$
|
156
|
$
|
(72
|
)
|
$
|
84
|
|||||
License
agreements
|
21
|
(4
|
) |
17
|
|
11
|
(3
|
)
|
8
|
|
|||||||||
Customer
relationships
|
103
|
(24
|
)
|
79
|
67
|
(19
|
)
|
48
|
|||||||||||
Trademarks
and tradenames
|
14
|
(8
|
)
|
6
|
12
|
(7
|
)
|
5
|
|||||||||||
Intangible
assets with indefinite lives:
|
|||||||||||||||||||
Trademarks
and tradenames
|
2
|
-
|
2
|
2
|
-
|
2
|
|||||||||||||
Intangible
assets
|
$
|
315
|
$
|
(119
|
)
|
$
|
196
|
$
|
248
|
$
|
(101
|
)
|
$
|
147
|
8.
|
Other
Assets
|
June 30,
|
|
September 30,
|
|
||||
|
|
2008
|
|
2007
|
|||
Long-term
receivables
|
$
|
107
|
$
|
73
|
|||
Long-term
deferred income taxes
|
40
|
1
|
|||||
Investment
in equity affiliates
|
11
|
10
|
|||||
Exchange
and rental assets, net of accumulated depreciation of $97 at June
30, 2008
and $95 at September 30, 2007
|
44
|
37
|
|||||
Other
|
53
|
74
|
|||||
Other
assets
|
$
|
255
|
$
|
195
|
9.
|
Other
Current Liabilities
|
June 30,
|
|
September 30,
|
|
||||
|
|
2008
|
|
2007
|
|||
Customer
incentives
|
$
|
116
|
$
|
117
|
|||
Contract
reserves
|
13
|
18
|
|||||
Other
|
69
|
78
|
|||||
Other
current liabilities
|
$
|
198
|
$
|
213
|
10.
|
Debt
|
June 30,
|
|
September 30,
|
|
||||
|
|
2008
|
|
2007
|
|||
Principal
amount of notes due December 1, 2013
|
$
|
200
|
$
|
200
|
|||
Principal
amount of variable rate loan facility due June 2011
|
27
|
24
|
|||||
Fair
value swap adjustment (Note 16)
|
1
|
(1
|
)
|
||||
Long-term
debt
|
$
|
228
|
$
|
223
|
11.
|
Retirement
Benefits
|
Three Months Ended
|
|
Nine Months Ended
|
|
||||||||||
|
|
June 30
|
|
June
30
|
|
||||||||
|
|
2008
|
|
2007
|
|
2008
|
|
2007
|
|||||
Service
cost
|
$
|
2
|
$
|
2
|
$
|
6
|
$
|
6
|
|||||
Interest
cost
|
41
|
38
|
122
|
113
|
|||||||||
Expected
return on plan assets
|
(50
|
)
|
(48
|
)
|
(151
|
)
|
(141
|
)
|
|||||
Amortization:
|
|||||||||||||
Prior
service cost
|
(5
|
)
|
(5
|
)
|
(14
|
)
|
(14
|
)
|
|||||
Net
actuarial loss
|
12
|
14
|
35
|
43
|
|||||||||
Net
benefit expense / (income)
|
$
|
-
|
$
|
1
|
$
|
(2
|
)
|
$
|
7
|
Three Months Ended
|
|
Nine Months Ended
|
|
||||||||||
|
|
June 30
|
|
June
30
|
|
||||||||
|
|
2008
|
|
2007
|
|
2008
|
|
2007
|
|||||
Service
cost
|
$
|
1
|
$
|
1
|
$
|
3
|
$
|
3
|
|||||
Interest
cost
|
3
|
4
|
11
|
12
|
|||||||||
Expected
return on plan assets
|
-
|
-
|
(1
|
)
|
(1
|
)
|
|||||||
Amortization: | |||||||||||||
Prior
service cost
|
(8
|
)
|
(10
|
)
|
(25
|
)
|
(29
|
)
|
|||||
Net
actuarial loss
|
3
|
4
|
10
|
12
|
|||||||||
Net
benefit expense / (income)
|
$
|
(1
|
)
|
$
|
(1
|
)
|
$
|
(2
|
)
|
$
|
(3
|
)
|
12.
|
Stock-Based
Compensation
|
Three Months Ended
|
|
Nine Months Ended
|
|
||||||||||
|
|
June 30
|
|
June
30
|
|
||||||||
|
|
2008
|
|
2007
|
|
2008
|
|
2007
|
|||||
Stock-based
compensation expense included in:
|
|||||||||||||
Product
cost of sales
|
$
|
1
|
$
|
1
|
$
|
3
|
$
|
3
|
|||||
Service
cost of sales
|
-
|
-
|
1
|
1
|
|||||||||
Selling,
general and administrative expenses
|
4
|
3
|
11
|
9
|
|||||||||
Income
before income taxes
|
$
|
5
|
$
|
4
|
$
|
15
|
$
|
13
|
|||||
Net
income
|
$
|
3
|
$
|
3
|
$
|
10
|
$
|
9
|
|||||
Basic
and diluted earnings per share
|
$
|
0.02
|
$
|
0.02
|
$
|
0.06
|
$
|
0.05
|
Performance
|
|
Restricted
|
|
Restricted
|
|
||||||||||||||||||||
|
|
Options
|
|
Shares
|
|
Stock
|
|
Stock Units
|
|
||||||||||||||||
|
|
|
|
Weighted
|
|
|
|
Weighted
|
|
|
|
Weighted
|
|
|
|
Weighted
|
|
||||||||
|
|
Number
|
|
Average
|
|
Number
|
|
Average
|
|
Number
|
|
Average
|
|
Number
|
|
Average
|
|
||||||||
|
|
Issued
|
|
Fair Value
|
|
Issued
|
|
Fair Value
|
|
Issued
|
|
Fair Value
|
|
Issued
|
|
Fair Value
|
|||||||||
Nine
months ended June 30, 2008
|
355,440
|
$
|
23.36
|
112,491(a)
|
|
$
|
73.37
|
45,900
|
$
|
72.12
|
19,828
|
$
|
66.19
|
||||||||||||
Nine
months ended June 30, 2007
|
454,930
|
$
|
16.70
|
64,285(b)
|
|
$
|
58.35
|
39,520
|
$
|
57.97
|
19,726
|
$
|
64.82
|
Nine Months Ended
|
|
||||||
|
|
June 30
|
|
||||
|
|
2008
|
|
2007
|
|
||
|
|
Grants
|
|
Grants
|
|||
Risk-free interest rate (U.S.
Treasury zero coupon issues)
|
3.89
|
%
|
4.56
|
%
|
|||
Expected
dividend yield
|
0.98
|
%
|
1.09
|
%
|
|||
Expected
volatility
|
0.30
|
0.28
|
|||||
Expected
life
|
6
years
|
5
years
|
13.
|
Comprehensive
Income
|
Three Months Ended
|
Nine Months Ended
|
||||||||||||
June 30
|
June 30
|
||||||||||||
2008
|
2007
|
2008
|
2007
|
||||||||||
Net
income
|
$
|
174
|
$
|
146
|
$
|
496
|
$
|
429
|
|||||
Unrealized
foreign currency translation adjustment
|
3
|
3
|
14
|
10
|
|||||||||
Foreign
currency cash flow hedge adjustment
|
(2
|
)
|
-
|
(2
|
)
|
(1
|
)
|
||||||
Amortization
of defined benefit plan costs
|
3
|
-
|
5
|
-
|
|||||||||
Minimum
pension liability adjustment
|
-
|
-
|
-
|
(47
|
)
|
||||||||
Comprehensive
income
|
$
|
178
|
$
|
149
|
$
|
513
|
$
|
391
|
14.
|
Other
Income, Net
|
Three Months Ended
|
Nine Months Ended
|
||||||||||||
June 30
|
June 30
|
||||||||||||
2008
|
2007
|
2008
|
2007
|
||||||||||
Earnings
from equity affiliates
|
$
|
3
|
$
|
1
|
$
|
7
|
$
|
6
|
|||||
Interest
income
|
2
|
1
|
6
|
3
|
|||||||||
Royalty
income
|
1
|
1
|
10
|
6
|
|||||||||
Other
|
(1
|
)
|
-
|
(2
|
)
|
(2
|
)
|
||||||
Other
income, net
|
$
|
5
|
$
|
3
|
$
|
21
|
$
|
13
|
15.
|
Income
Taxes
|
16.
|
Financial
Instruments
|
Asset (Liability)
|
|||||||||||||
June 30, 2008
|
September 30, 2007
|
||||||||||||
Carrying
|
Fair
|
Carrying
|
Fair
|
||||||||||
Amount
|
Value
|
Amount
|
Value
|
||||||||||
Cash
and cash equivalents
|
$
|
187
|
$
|
187
|
$
|
231
|
$
|
231
|
|||||
Deferred
compensation plan investments
|
37
|
37
|
39
|
39
|
|||||||||
Short-term
debt
|
(429
|
)
|
(429
|
)
|
-
|
-
|
|||||||
Long-term
debt
|
(228
|
)
|
(224
|
)
|
(223
|
)
|
(216
|
)
|
|||||
Interest
rate swaps
|
1
|
1
|
(1
|
)
|
(1
|
)
|
|||||||
Foreign
currency forward exchange contracts
|
(9
|
)
|
(9
|
)
|
(5
|
)
|
(5
|
)
|
17.
|
Guarantees
and Indemnifications
|
Nine Months Ended
|
|||||||
June 30
|
|||||||
2008
|
2007
|
||||||
Balance
at beginning of year
|
$
|
213
|
$
|
189
|
|||
Warranty
costs incurred
|
(38
|
)
|
(39
|
)
|
|||
Product
warranty accrual
|
50
|
56
|
|||||
Reclassifications
|
-
|
7
|
|||||
Increase
from acquisitions
|
1
|
-
|
|||||
(1
|
)
|
-
|
|||||
Balance
at June 30
|
$
|
225
|
$
|
213
|
18.
|
Environmental
Matters
|
19.
|
Legal
Matters
|
20.
|
Business
Segment Information
|
The
sales and results of operations of the Company’s operating segments are
summarized as follows (in
millions):
|
Three Months Ended
June 30
|
Nine Months Ended
June 30
|
||||||||||||
2008
|
2007
|
2008
|
2007
|
||||||||||
Sales:
|
|||||||||||||
Commercial
Systems
|
$
|
587
|
$
|
545
|
$
|
1,762
|
$
|
1,579
|
|||||
Government
Systems
|
607
|
568
|
1,730
|
1,610
|
|||||||||
Total
sales
|
$
|
1,194
|
$
|
1,113
|
$
|
3,492
|
$
|
3,189
|
|||||
Segment
operating earnings:
|
|||||||||||||
Commercial
Systems
|
$
|
139
|
$
|
119
|
$
|
416
|
$
|
355
|
|||||
Government
Systems
|
131
|
111
|
361
|
320
|
|||||||||
Total
segment operating earnings
|
270
|
230
|
777
|
675
|
|||||||||
Interest
expense
|
(5
|
)
|
(3
|
)
|
(15
|
)
|
(10
|
)
|
|||||
Stock-based
compensation
|
(5
|
)
|
(4
|
)
|
(15
|
)
|
(13
|
)
|
|||||
Restructuring
adjustment
|
-
|
1
|
-
|
4
|
|||||||||
General
corporate, net
|
(12
|
)
|
(15
|
)
|
(35
|
)
|
(42
|
)
|
|||||
Income
before income taxes
|
248
|
209
|
712
|
614
|
|||||||||
Income
tax provision
|
(74
|
)
|
(63
|
)
|
(216
|
)
|
(185
|
)
|
|||||
Net
income
|
$
|
174
|
$
|
146
|
$
|
496
|
$
|
429
|
Three Months Ended
June 30
|
Nine Months Ended
June 30
|
||||||||||||
2008
|
2007
|
2008
|
2007
|
||||||||||
Commercial
Systems product categories:
|
|||||||||||||
Air
transport aviation electronics
|
$
|
306
|
$
|
291
|
$
|
927
|
$
|
829
|
|||||
Business
and regional aviation electronics
|
281
|
254
|
835
|
750
|
|||||||||
Total
Commercial Systems sales
|
$
|
587
|
$
|
545
|
$
|
1,762
|
$
|
1,579
|
|||||
Government
Systems product categories:
|
|||||||||||||
Airborne
Solutions
|
$
|
429
|
$
|
404
|
$
|
1,203
|
$
|
1,148
|
|||||
Surface
Solutions
|
178
|
164
|
527
|
462
|
|||||||||
Total
Government Systems sales
|
$
|
607
|
$
|
568
|
$
|
1,730
|
$
|
1,610
|
(dollars
in millions)
|
Three Months Ended
June 30
|
||||||
2008
|
2007
|
||||||
Total
sales
|
$
|
1,194
|
$
|
1,113
|
|||
Percent
increase
|
7
|
%
|
(dollars
in millions, except per share amounts)
|
Three Months Ended
June 30
|
||||||
2008
|
2007
|
||||||
Net
income
|
$
|
174
|
$
|
146
|
|||
Net
income as a percent of sales
|
14.6
|
%
|
13.1
|
%
|
|||
Diluted
earnings per share
|
$
|
1.07
|
$
|
0.86
|
(dollars
in millions)
|
Three Months Ended
June 30
|
||||||
2008
|
2007
|
||||||
Air
transport aviation electronics
|
$
|
306
|
$
|
291
|
|||
Business
and regional aviation electronics
|
281
|
254
|
|||||
Total
|
$
|
587
|
$
|
545
|
|||
Percent
increase
|
8
|
%
|
Three Months Ended
June 30
|
|||||||
2008
|
2007
|
||||||
Original equipment
|
$
|
328
|
$
|
274
|
|||
Aftermarket
|
259
|
271
|
|||||
Total
|
$
|
587
|
$
|
545
|
|||
Percent
increase
|
8
|
%
|
(dollars
in millions)
|
Three Months Ended
June 30
|
||||||
2008
|
2007
|
||||||
Segment
operating earnings
|
$
|
139
|
$
|
119
|
|||
Percent
of sales
|
23.7
|
%
|
21.8
|
%
|
(dollars
in millions)
|
Three Months Ended
June 30
|
||||||
2008
|
2007
|
||||||
Airborne
solutions
|
$
|
429
|
$
|
404
|
|||
Surface
solutions
|
178
|
164
|
|||||
Total
|
$
|
607
|
$
|
568
|
|||
Percent
increase
|
7
|
%
|
(dollars
in millions)
|
Three Months Ended
June 30
|
||||||
2008
|
2007
|
||||||
Segment
operating earnings
|
$
|
131
|
$
|
111
|
|||
Percent
of sales
|
21.6
|
%
|
19.5
|
%
|
(dollars
in millions)
|
Nine Months Ended
June 30
|
||||||
2008
|
2007
|
||||||
Total
sales
|
$
|
3,492
|
$
|
3,189
|
|||
Percent
increase
|
10
|
%
|
(dollars
in millions, except per share amounts)
|
Nine Months Ended
June 30
|
||||||
2008
|
2007
|
||||||
Net
income
|
$
|
496
|
$
|
429
|
|||
Net
income as a percent of sales
|
14.2
|
%
|
13.5
|
%
|
|||
Diluted
earnings per share
|
$
|
3.03
|
$
|
2.52
|
Nine Months Ended
June 30
|
|||||||
2008
|
2007
|
||||||
Air
transport aviation electronics
|
$
|
927
|
$
|
829
|
|||
Business
and regional aviation electronics
|
835
|
750
|
|||||
Total
|
$
|
1,762
|
$
|
1,579
|
|||
Percent
increase
|
12
|
%
|
Nine Months Ended
June 30
|
|||||||
2008
|
2007
|
||||||
Original
equipment
|
$
|
971
|
$
|
783
|
|||
Aftermarket
|
791
|
796
|
|||||
Total
|
$
|
1,762
|
$
|
1,579
|
|||
Percent
increase
|
12
|
%
|
(dollars
in millions)
|
Nine Months Ended
June 30
|
||||||
2008
|
2007
|
||||||
Segment
operating earnings
|
$
|
416
|
$
|
355
|
|||
Percent
of sales
|
23.6
|
%
|
22.5
|
%
|
(dollars
in millions)
|
Nine Months Ended
June 30
|
||||||
2008
|
2007
|
||||||
Airborne
solutions
|
$
|
1,203
|
$
|
1,148
|
|||
Surface
solutions
|
527
|
462
|
|||||
Total
|
$
|
1,730
|
$
|
1,610
|
|||
Percent
increase
|
7
|
%
|
(dollars
in millions)
|
Nine Months Ended
June 30
|
||||||
2008
|
2007
|
||||||
Segment
operating earnings
|
$
|
361
|
$
|
320
|
|||
Percent
of sales
|
20.9
|
%
|
19.9
|
%
|
Three Months Ended
June 30
|
Nine Months Ended
June 30
|
||||||||||||
2008
|
2007
|
2008
|
2007
|
||||||||||
Pension
benefits
|
$
|
-
|
$
|
1
|
$
|
(2
|
)
|
$
|
7
|
||||
(1
|
)
|
(1
|
)
|
(2
|
)
|
(3
|
)
|
||||||
Net
benefit expense / (income)
|
$
|
(1
|
)
|
$
|
-
|
$
|
(4
|
)
|
$
|
4
|
·
|
Total
sales of about $4.75 billion.
|
·
|
Earnings
per share in the range of $4.05 to
$4.10.
|
·
|
Cash
flow from operating activities in the range of $675 million to $725
million.
|
·
|
Research
and development expenditures in the range of $925 million to $950
million.
|
(in
millions)
|
Nine Months Ended
|
||||||
June 30
|
|||||||
2008
|
2007
|
||||||
Cash
provided by operating activities
|
$
|
310
|
$
|
298
|
(in
millions)
|
Nine Months Ended
|
||||||
June 30
|
|||||||
2008
|
2007
|
||||||
Cash
used for investing activities
|
$
|
(226
|
)
|
$
|
(71
|
)
|
· |
$107
million related to the acquisition of Athena Technologies, Inc. in
April
of 2008.
|
· |
$28
million of additional capital expenditures during the nine months
ended
June 30, 2008 compared to the same period a year
ago.
|
· |
The
nine months ended June 30, 2007 benefited from a $14 million recovery
of a
license fee paid to The Boeing Company in prior years as a result
of The
Boeing Company exiting the high-speed broadband communication connectivity
markets.
|
· |
During
the nine months ended June 30, 2007, we received $5 million as a
result of
a purchase price adjustment related to the E&S Simulation
Business.
|
(in
millions)
|
Nine Months Ended
|
||||||
June 30
|
|||||||
2008
|
2007
|
||||||
Cash
used for financing activities
|
$
|
(131
|
)
|
$
|
(241
|
)
|
·
|
We
had proceeds from short-term borrowings of $429 million for the nine
months ended June 30, 2008 compared to net payments on borrowings
in the
same period last year of $23
million.
|
·
|
Share
repurchases increased during the nine months ended June 30, 2008
to $492
million compared to $222 million paid for share repurchases during
the
same period last year.
|
·
|
We
received $16 million from the exercise of stock options for the nine
months ended June 30, 2008 compared to $56 million for the same period
last year.
|
·
|
We
received a $7 million excess tax benefit from the exercise of stock
options for the nine months ended June 30, 2008 compared to $29 million
for the same period last year.
|
·
|
We
paid cash dividends of $91 million during the nine months ended June
30,
2008 compared to $81 million for the same period last year.
|
Period
|
Total Number of
Shares
Purchased
|
Average Price
Paid per Share
|
Total Number of
Shares Purchased
as Part of Publicly
Announced Plans
or Programs
|
Maximum Number
(or Appropriate
Dollar Value) of
Shares that May
Yet Be Purchased
Under the Plans or
Programs 1
|
|||||||||
April
1, 2008 through
April
30, 2008
|
-
|
-
|
-
|
$ |
326
million
|
||||||||
May
1, 2008 through
May
31, 2008
|
570,000
|
$
|
63.52
|
570,000
|
$
|
289
million
|
|||||||
June
1, 2008 through
June
30, 2008
|
830,000
|
$
|
54.09
|
830,000
|
$
|
245
million
|
|||||||
Total
|
1,400,000
|
$
|
57.93
|
1,400,000
|
$
|
245
million
|
(a)
|
Exhibits
|
12
|
Computation
of Ratio of Earnings to Fixed Charges for the nine months ended June
30,
2008.
|
|
31.1
|
Certification
by Chief Executive Officer Pursuant to Rule 13a-14(a) of the Securities
Exchange Act of 1934.
|
|
31.2
|
Certification
by Chief Financial Officer Pursuant to Rule 13a-14(a) of the Securities
Exchange Act of 1934.
|
|
32.1
|
Certification
by Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as
adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
|
32.2
|
Certification
by Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as
adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
ROCKWELL COLLINS, INC.
|
||
(Registrant)
|
||
Date:
July 23, 2008
|
By
|
/s/
M. A. Schulte
|
M.
A. Schulte
|
||
Vice President, Finance and Controller
|
||
(Principal Accounting Officer)
|
||
Date: July 23, 2008
|
By
|
/s/ G. R. Chadick
|
G. R. Chadick
|
||
Senior Vice President,
|
||
General Counsel and Secretary
|