Raytheon Reports Solid Fourth Quarter and Full-Year 2008 Results; Reaffirms Outlook for Continued Growth in 2009

Highlights - Year-end backlog increased to a record $38.9 billion - Delivered strong full-year sales growth of 9% - Fourth quarter adjusted EPS from continuing operations of $1.13 grew by 18%; reported EPS from continuing...


During the year, IDS booked $2,483 million to provide advanced Patriot air and missile defense capability for the UAE and $533 million on international contracts for the design, development and support of the Patriot system. IDS also booked $237 million to provide engineering services support for Patriot air and missile defense programs and $229 million for the Rapid Aerostat Initial Deployment (RAID) program for the U.S. Army.

Intelligence and Information Systems

Fourth Quarter

Intelligence and Information Systems (IIS) had fourth quarter 2008 net sales of $810 million compared to $808 million in the fourth quarter 2007. IIS recorded $67 million of operating income compared to $66 million in the fourth quarter 2007.

During the quarter, IIS booked $443 million on a number of classified contracts.

Full-year

IIS had full-year 2008 net sales of $3,132 million compared to $2,742 million in 2007. The increase in sales was primarily due to higher volume on the international e-Borders program and a competitive design program for the U.S. Air Force's next generation global positioning ground system. IIS recorded $253 million of operating income in 2008 compared to $248 million in 2007. The increase in operating income was partially offset by certain acquisition costs and other investments in cyber operations and information security capabilities.

During the year, IIS booked $1,789 million on a number of classified contracts, including $379 million on a major classified program.

Missile Systems

Fourth Quarter

Missile Systems (MS) had fourth quarter 2008 net sales of $1,360 million compared to $1,362 million in the fourth quarter 2007. MS recorded $143 million of operating income compared to $148 million in the fourth quarter 2007.

During the quarter, MS booked $423 million for the production of Standard Missile-2 (SM-2) for international customers and the U.S. Navy, and $161 million for Standard Missile-3 (SM-3) for the U.S. Navy and the Missile Defense Agency. MS also booked $132 million for the production of Tube-launched Optically guided Wire controlled (TOW) missiles for international customers and the U.S. Army.

Full-year

MS had full-year 2008 net sales of $5,377 million compared to $4,993 million in 2007. The increase in sales in 2008 was primarily due to higher volume on the Advanced Medium-Range Air-to-Air Missile (AMRAAM), Rolling Airframe Missile (RAM), Phalanx, Paveway(TM) and TOW programs. MS recorded $581 million of operating income in 2008 compared to $541 million in 2007. The increase in operating profit in 2008 was primarily due to higher volume.

During the year, MS booked $1,165 million for the production of SM-3 for the U.S. Navy and the Missile Defense Agency, $624 million for the production of the AMRAAM program for international customers and the U.S. Air Force, $577 million on Standard Missile development and production and $478 million for the production of Tactical Tomahawk cruise missiles for the U.S. Navy.

Network Centric Systems

Fourth Quarter

Network Centric Systems (NCS) had fourth quarter 2008 net sales of $1,125 million compared to $1,147 million in the fourth quarter 2007. NCS recorded $141 million of operating income compared to $127 million in the fourth quarter 2007. The increase in operating income was primarily due to productivity improvements.

During the quarter, NCS booked $218 million to provide support for the Firefinder weapon locating radar program, $173 million to provide Horizontal Technology Integration (HTI) forward-looking infrared kits and $122 million for Long Range Advanced Scout Surveillance Systems (LRAS3) for the U.S. Army.

Full-year

NCS had full-year 2008 net sales of $4,510 million compared to $4,164 million in 2007. The increase in sales was primarily due to higher volume on U.S. Army programs. NCS recorded $552 million of operating income compared to $506 million in 2007. The increase in operating income was primarily due to the higher volume.