RTX exceeds 2024 sales and EPS expectations*; Expects
continued sales, earnings, and cash flow growth in 2025
ARLINGTON, Va., Jan. 28,
2025 /PRNewswire/ -- RTX (NYSE: RTX) reports fourth
quarter 2024 results and announces 2025 outlook.
Fourth quarter 2024
- Sales of $21.6 billion, up 9
percent versus prior year, and up 11 percent organically* excluding
divestitures
- GAAP EPS was $1.10 and included
$0.30 of acquisition accounting
adjustments and $0.14 of
restructuring and other net significant and/or non-recurring
charges
- Adjusted EPS* of $1.54, up 19
percent versus prior year
- Operating cash flow of $1.6
billion; free cash flow* of $0.5
billion
- Company backlog of $218 billion;
including $125 billion of commercial
and $93 billion of defense
- Returned $852 million of capital
to shareowners
Full year 2024
- Reported sales of $80.7
billion
- Adjusted sales* of $80.8 billion,
up 9 percent versus prior year, and up 11 percent organically*
excluding divestitures
- GAAP EPS was $3.55 and included
$1.20 of acquisition accounting
adjustments and $0.98 of
restructuring and other net significant and/or non-recurring
charges
- Adjusted EPS* of $5.73, up 13
percent versus prior year
- Operating cash flow of $7.2
billion; free cash flow* of $4.5
billion
- Returned $3.7 billion of capital
to shareowners, returning over $33
billion since the merger
Outlook for full year 2025
- Adjusted sales* of $83.0 -
$84.0 billion, including 4 to 6
percent organic growth*
- Adjusted EPS* of $6.00 -
$6.15
- Free cash flow* of $7.0 -
$7.5 billion
"RTX delivered a very strong year of performance in 2024 with 11
percent organic sales growth* and 13 percent adjusted EPS growth*,
including segment margin expansion* in all three businesses," said
RTX President and CEO Chris
Calio.
"We have strong momentum heading into 2025 with a $218 billion backlog and unprecedented demand for
our products and solutions. We remain focused on advancing our
strategic priorities of executing on our commitments, innovating
for growth and harnessing the breadth and scale of RTX, giving us
confidence in our 2025 financial outlook."
Fourth quarter 2024
RTX reported fourth quarter sales of $21.6
billion, up 9 percent over the prior year. GAAP EPS of
$1.10 included $0.30 of acquisition accounting adjustments,
$0.05 of restructuring, and
$0.09 of other net significant and/or
non-recurring charges. Adjusted EPS* of $1.54 was up 19 percent versus the prior
year.
The company reported net income attributable to common
shareowners in the fourth quarter of $1.5
billion which included $408
million of acquisition accounting adjustments, $61 million of restructuring, and $120 million of other net significant and/or
non-recurring charges. Adjusted net income* of $2.1 billion was up 18 percent versus the prior
year driven by growth in adjusted segment operating profit*,
partially offset by higher taxes and lower pension income.
Operating cash flow in the fourth quarter was $1.6 billion. Capital expenditures were
$1.1 billion, resulting in free cash
flow* of $0.5 billion.
Summary Financial Results – Operations Attributable to Common
Shareowners
|
|
4th
Quarter
|
|
Twelve
Months
|
|
($ in millions, except
EPS)
|
2024
|
|
2023
|
%
Change
|
|
2024
|
|
2023
|
%
Change
|
|
Reported
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
$
21,623
|
|
$
19,927
|
9 %
|
|
$
80,738
|
|
$
68,920
|
17 %
|
|
Net Income
|
$ 1,482
|
|
$ 1,426
|
4 %
|
|
$ 4,774
|
|
$ 3,195
|
49 %
|
|
EPS
|
$
1.10
|
|
$
1.05
|
5 %
|
|
$
3.55
|
|
$
2.23
|
59 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted*
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
$
21,623
|
|
$
19,824
|
9 %
|
|
$
80,808
|
|
$
74,305
|
9 %
|
|
Net Income
|
$ 2,071
|
|
$ 1,753
|
18 %
|
|
$ 7,705
|
|
$ 7,263
|
6 %
|
|
EPS
|
$
1.54
|
|
$
1.29
|
19 %
|
|
$
5.73
|
|
$
5.06
|
13 %
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Cash
Flow
|
|
$ 1,561
|
|
$ 4,711
|
(67) %
|
|
$ 7,159
|
|
$ 7,883
|
(9) %
|
|
Free Cash
Flow*
|
|
$
492
|
|
$ 3,906
|
(87) %
|
|
$ 4,534
|
|
$ 5,468
|
(17) %
|
Segment Results
Collins Aerospace
|
4th
Quarter
|
|
Twelve
Months
|
|
($ in
millions)
|
2024
|
|
2023
|
%
Change
|
|
2024
|
|
2023
|
%
Change
|
|
Reported
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
$
7,537
|
|
$
7,120
|
6 %
|
|
|
$ 28,284
|
|
$ 26,253
|
8 %
|
|
|
Operating
Profit
|
$
1,106
|
|
$
1,126
|
(2) %
|
|
|
$
4,135
|
|
$
3,825
|
8 %
|
|
|
ROS
|
14.7 %
|
|
15.8 %
|
(110)
|
bps
|
|
14.6 %
|
|
14.6 %
|
—
|
bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted*
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
$
7,537
|
|
$
7,008
|
8 %
|
|
|
$ 28,284
|
|
$ 26,198
|
8 %
|
|
|
Operating
Profit
|
$
1,207
|
|
$
1,035
|
17 %
|
|
|
$
4,496
|
|
$
3,896
|
15 %
|
|
|
ROS
|
16.0 %
|
|
14.8 %
|
120
|
bps
|
|
15.9 %
|
|
14.9 %
|
100
|
bps
|
Collins Aerospace had fourth quarter 2024 reported sales of
$7,537 million, up 6 percent versus
the prior year. The increase in sales was driven by a 13
percent increase in defense and a 12 percent increase in commercial
aftermarket, partially offset by a 6 percent decrease in commercial
OE. The increase in defense sales was driven by higher volume
across multiple programs and platforms, including new programs
awarded in 2024. The increase in commercial aftermarket sales was
driven by continued growth in commercial air traffic, and the
decrease in commercial OE sales was driven by lower narrow-body
volume. Adjusted sales* of $7,537
million, were up 8 percent versus the prior year.
Collins Aerospace reported operating profit of $1,106 million, down 2 percent versus the prior
year. This included a $155 million
charge related to the impairment of contract fulfillment costs
which was partially offset by a $99
million gain on the sale of the Hoist & Winch business.
Q4 2023 included a benefit of $112
million from a customer settlement. On an adjusted basis,
operating profit* of $1,207 million
was up 17 percent versus the prior year. Operationally, the
increase was driven by drop through on higher commercial
aftermarket and defense volume, which was partially offset by lower
commercial OE volume and unfavorable commercial OE mix.
Pratt & Whitney
|
4th
Quarter
|
|
Twelve
Months
|
|
($ in
millions)
|
2024
|
|
2023
|
%
Change
|
|
2024
|
|
2023
|
%
Change
|
|
Reported
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
$
7,569
|
|
$
6,439
|
18 %
|
|
|
$ 28,066
|
|
$ 18,296
|
NM
|
|
|
Operating Profit
(loss)
|
$ 504
|
|
$ 382
|
32 %
|
|
|
$
2,015
|
|
$ (1,455)
|
NM
|
|
|
ROS
|
6.7 %
|
|
5.9 %
|
80
|
bps
|
|
7.2 %
|
|
(8.0) %
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted*
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
$
7,569
|
|
$
6,439
|
18 %
|
|
|
$ 28,066
|
|
$ 23,697
|
18 %
|
|
|
Operating
Profit
|
$ 717
|
|
$ 405
|
77 %
|
|
|
$
2,281
|
|
$
1,688
|
35 %
|
|
|
ROS
|
9.5 %
|
|
6.3 %
|
320
|
bps
|
|
8.1 %
|
|
7.1 %
|
100
|
bps
|
Pratt & Whitney had fourth quarter 2024 reported and
adjusted sales of $7,569 million, up
18 percent versus the prior year. The increase was driven by a
31 percent increase in commercial OE, a 17 percent increase in
commercial aftermarket, and an 8 percent increase in military. The
increase in commercial sales was driven by increased deliveries and
favorable OE mix in Large Commercial Engines, and higher commercial
aftermarket volume. The increase in military sales was driven by
higher volume on F135 production, the F135 Engine Core Upgrade
program, and F135 sustainment, which was partially offset by lower
sustainment volume across legacy platforms, including the F100 and
F117.
Pratt & Whitney reported operating profit of $504 million, up 32 percent versus the prior
year. The increase was driven by favorable volume and mix in Large
Commercial Engines OE, favorable mix in Pratt Canada aftermarket, and drop through on
higher commercial aftermarket and military volume. Pratt &
Whitney also benefited from an approximately $70 million insurance recovery. Reported
operating profit included a $157
million charge related to a customer bankruptcy. On an
adjusted basis, operating profit* of $717
million, was up 77 percent versus the prior year.
Raytheon
|
4th
Quarter
|
|
Twelve
Months
|
|
($ in
millions)
|
2024
|
|
2023
|
%
Change
|
|
2024
|
|
2023
|
%
Change
|
|
Reported
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
$
7,157
|
|
$
6,886
|
4 %
|
|
|
$ 26,713
|
|
$ 26,350
|
1 %
|
|
|
Operating
Profit
|
$ 824
|
|
$ 604
|
36 %
|
|
|
$
2,594
|
|
$
2,379
|
9 %
|
|
|
ROS
|
11.5 %
|
|
8.8 %
|
270
|
bps
|
|
9.7 %
|
|
9.0 %
|
70
|
bps
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted*
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
$
7,157
|
|
$
6,886
|
4 %
|
|
|
$ 26,783
|
|
$ 26,350
|
2 %
|
|
|
Operating
Profit
|
$ 728
|
|
$ 618
|
18 %
|
|
|
$
2,728
|
|
$
2,434
|
12 %
|
|
|
ROS
|
10.2 %
|
|
9.0 %
|
120
|
bps
|
|
10.2 %
|
|
9.2 %
|
100
|
bps
|
Raytheon had fourth quarter 2024 reported and adjusted sales of
$7,157 million, up 4 percent versus
the prior year. The increase in sales was driven by higher
volume on land and air defense systems, including Global Patriot,
NASAMS and counter-UAS programs, as well as higher volume from the
restart of contracts with a Middle
East customer. This was partially offset by the impact from
the divestiture of the Cybersecurity, Intelligence and Services
business completed in the first quarter of 2024 and lower volume on
air and space defense systems. Excluding the impact of the
divestiture, sales were up 10 percent versus the prior year*.
Raytheon reported operating profit of $824 million, up 36 percent versus the prior
year. The increase was driven by drop through on higher volume,
improved net productivity, and favorable mix which was partially
offset by the impact from the divestiture of the Cybersecurity,
Intelligence and Services business. Reported operating profit
included a $102 million benefit
related to reserve adjustments associated with the restart of
contracts with a Middle East
customer. On an adjusted basis, operating profit* of $728 million was up 18 percent versus the prior
year.
|
*Adjusted net sales
(also referred to as adjusted sales), organic sales, adjusted
operating profit (loss) and margin, adjusted segment operating
profit (loss) and margin, adjusted net income, adjusted earnings
per share ("EPS"), adjusted effective tax rate and free cash flow
are non-GAAP financial measures. When we provide our expectation
for adjusted net sales (also referred to as adjusted sales),
adjusted EPS and free cash flow on a forward-looking basis, a
reconciliation of these non-GAAP financial measures to the
corresponding GAAP measures (expected diluted EPS and expected cash
flow from operations) is not available without unreasonable effort
due to potentially high variability, complexity, and low visibility
as to the items that would be excluded from the GAAP measure in the
relevant future period, such as unusual gains and losses, the
ultimate outcome of pending litigation, fluctuations in foreign
currency exchange rates, the impact and timing of potential
acquisitions and divestitures, and other structural changes or
their probable significance. The variability of the excluded items
may have a significant, and potentially unpredictable, impact on
our future GAAP results. See "Use and Definitions of Non-GAAP
Financial Measures" below for information regarding non-GAAP
financial measures.
|
About RTX
RTX is the world's largest aerospace and
defense company. With more than 185,000 global employees, we push
the limits of technology and science to redefine how we connect and
protect our world. Through industry-leading businesses – Collins
Aerospace, Pratt & Whitney and Raytheon – we are advancing
aviation, engineering integrated defense systems for operational
success, and developing next-generation technology solutions and
manufacturing to help global customers address their most critical
challenges. The company, with 2024 sales of more than $80 billion, is headquartered in Arlington, Virginia.
Conference Call on the Fourth Quarter 2024 Financial
Results
RTX's financial results conference call will be held
on Tuesday, January 28, 2025 at 8:30
a.m. ET. The conference call will be webcast live on the
company's website at www.rtx.com and will be available for replay
following the call. The corresponding presentation slides will be
available for downloading prior to the call.
Use and Definitions of Non-GAAP Financial Measures
RTX
Corporation ("RTX" or "the Company") reports its financial results
in accordance with accounting principles generally accepted in
the United States ("GAAP"). We
supplement the reporting of our financial information determined
under GAAP with certain non-GAAP financial information. The
non-GAAP information presented provides investors with additional
useful information but should not be considered in isolation or as
substitutes for the related GAAP measures. We believe that these
non-GAAP measures provide investors with additional insight into
the Company's ongoing business performance. Other companies may
define non-GAAP measures differently, which limits the usefulness
of these measures for comparisons with such other companies. We
encourage investors to review our financial statements and
publicly-filed reports in their entirety and not to rely on any
single financial measure. A reconciliation of the non-GAAP measures
to the corresponding amounts prepared in accordance with GAAP
appears in the tables in this Appendix. Certain non-GAAP financial
adjustments are also described in this Appendix. Below are our
non-GAAP financial measures:
|
Non-GAAP
measure
|
Definition
|
|
Adjusted net sales /
Adjusted sales
|
Represents consolidated
net sales (a GAAP measure), excluding net significant and/or
non-recurring items1 (hereinafter referred to as "net
significant and/or non-recurring items").
|
|
Organic
sales
|
Organic sales
represents the change in consolidated net sales (a GAAP measure),
excluding the impact of foreign currency translation, acquisitions
and divestitures completed in the preceding twelve months and net
significant and/or non-recurring items.
|
|
Adjusted operating
profit (loss) and margin
|
Adjusted operating
profit (loss) represents operating profit (loss) (a GAAP measure),
excluding restructuring costs, acquisition accounting adjustments
and net significant and/or non-recurring items. Adjusted operating
profit margin represents adjusted operating profit (loss) as a
percentage of adjusted net sales.
|
|
Segment operating
profit (loss) and margin
|
Segment operating
profit (loss) represents operating profit (loss) (a GAAP measure)
excluding Acquisition Accounting Adjustments2, the
FAS/CAS operating adjustment3, Corporate expenses and
other unallocated items, and Eliminations and other. Segment
operating profit margin represents segment operating profit (loss)
as a percentage of segment sales (net sales, excluding Eliminations
and other).
|
|
Adjusted segment
sales
|
Represents consolidated
net sales (a GAAP measure) excluding eliminations and other and net
significant and/or non-recurring items.
|
|
Adjusted segment
operating profit (loss) and margin
|
Adjusted segment
operating profit (loss) represents segment operating profit (loss)
excluding restructuring costs, and net significant and/or
non-recurring items. Adjusted segment operating profit margin
represents adjusted segment operating profit (loss) as a percentage
of adjusted segment sales (adjusted net sales excluding
Eliminations and other).
|
|
Adjusted net
income
|
Adjusted net income
represents net income (a GAAP measure), excluding restructuring
costs, acquisition accounting adjustments and net significant
and/or non-recurring items.
|
|
Adjusted earnings per
share (EPS)
|
Adjusted EPS represents
diluted earnings per share (a GAAP measure), excluding
restructuring costs, acquisition accounting adjustments and net
significant and/or non-recurring items.
|
|
Adjusted effective tax
rate
|
Adjusted effective tax
rate represents the effective tax rate (a GAAP measure), excluding
the tax impact of restructuring costs, acquisition accounting
adjustments and net significant and/or non-recurring
items.
|
|
Free cash
flow
|
Free cash flow
represents cash flow from operations (a GAAP measure) less capital
expenditures. Management believes free cash flow is a useful
measure of liquidity and an additional basis for assessing RTX's
ability to fund its activities, including the financing of
acquisitions, debt service, repurchases of RTX's common stock and
distribution of earnings to shareowners.
|
|
1 Net
significant and/or non-recurring items represent significant
nonoperational items and/or significant operational items that may
occur at irregular intervals.
|
|
|
2
Acquisition Accounting Adjustments include the amortization of
acquired intangible assets related to acquisitions, the
amortization of the property, plant and equipment fair value
adjustment acquired through acquisitions, the amortization of
customer contractual obligations related to loss making or below
market contracts acquired, and goodwill impairment, if
applicable.
|
|
|
3 The
FAS/CAS operating adjustment represents the difference between the
service cost component of our pension and postretirement benefit
(PRB) expense under the Financial Accounting Standards (FAS)
requirements of GAAP and our pension and PRB expense under U.S.
government Cost Accounting Standards (CAS) primarily related to our
Raytheon segment.
|
When we provide our expectation for adjusted net sales (also
referred to as adjusted sales), organic sales, adjusted operating
profit (loss) and margin, adjusted segment operating profit (loss)
and margin, adjusted EPS, adjusted effective tax rate, and free
cash flow, on a forward-looking basis, a reconciliation of the
differences between the non-GAAP expectations and the corresponding
GAAP measures, as described above, generally are not available
without unreasonable effort due to potentially high variability,
complexity, and low visibility as to the items that would be
excluded from the GAAP measure in the relevant future period, such
as unusual gains and losses, the ultimate outcome of pending
litigation, fluctuations in foreign currency exchange rates, the
impact and timing of potential acquisitions and divestitures, and
other structural changes or their probable significance. The
variability of the excluded items may have a significant, and
potentially unpredictable, impact on our future GAAP results.
Cautionary Statement Regarding Forward-Looking Statements
This press release contains statements which, to the extent they
are not statements of historical or present fact, constitute
"forward-looking statements" under the securities laws. From time
to time, oral or written forward-looking statements may also be
included in other information released to the public. These
forward-looking statements are intended to provide RTX Corporation
("RTX") management's current expectations or plans for our future
operating and financial performance, based on assumptions currently
believed to be valid and are not statements of historical fact.
Forward-looking statements can be identified by the use of words
such as "believe," "expect," "expectations," "plans," "strategy,"
"prospects," "estimate," "project," "target," "anticipate," "will,"
"should," "see," "guidance," "outlook," "goals," "objectives,"
"confident," "on track," "designed to, " "commit," "commitment" and
other words of similar meaning. Forward-looking statements may
include, among other things, statements relating to future sales,
earnings, cash flow, results of operations, uses of cash, share
repurchases, tax payments and rates, research and development
spending, cost savings, other measures of financial performance,
potential future plans, strategies or transactions, credit ratings
and net indebtedness, the Pratt powder metal matter and related
matters and activities, including without limitation other engine
models that may be impacted, the merger (the "merger") between
United Technologies Corporation ("UTC") and Raytheon Company
("Raytheon") or the spin-offs by UTC of Otis Worldwide Corporation
and Carrier Global Corporation into separate independent companies
(the "separation transactions") in 2020, the pending disposition of
Collins' actuation and flight control business, targets and
commitments (including for share repurchases or otherwise), and
other statements that are not solely historical facts. All
forward-looking statements involve risks, uncertainties and other
factors that may cause actual results to differ materially from
those expressed or implied in the forward-looking statements. For
those statements, we claim the protection of the safe harbor for
forward-looking statements contained in the U.S. Private Securities
Litigation Reform Act of 1995. Such risks, uncertainties and other
factors include, without limitation: (1) the effect of changes in
economic, capital market and political conditions in the U.S. and
globally, such as from the global sanctions and export controls
with respect to Russia, and any
changes therein, and including changes related to financial market
conditions, banking industry disruptions, fluctuations in commodity
prices or supply (including energy supply), inflation, interest
rates and foreign currency exchange rates, disruptions in global
supply chain and labor markets, levels of consumer and business
confidence, the imposition of tariffs, and geopolitical risks,
including, without limitation, in the Middle East and Ukraine; (2) risks associated with U.S.
government sales, including changes or shifts in defense spending
due to budgetary constraints, spending cuts resulting from
sequestration, a continuing resolution, a government shutdown, the
debt ceiling or measures taken to avoid default, or otherwise, and
uncertain funding of programs; (3) risks relating to our
performance on our contracts and programs, including our ability to
control costs, the mix of our contracts and programs, and our
inability to pass some or all of our costs on fixed price contracts
to the customer, and risks related to our dependence on U.S.
government approvals for international contracts; (4) challenges in
the development, certification, production, delivery, support and
performance of RTX advanced technologies and new products and
services and the realization of the anticipated benefits (including
our expected returns under customer contracts), as well as the
challenges of operating in RTX's highly-competitive industries both
domestically and abroad; (5) risks relating to RTX's reliance on
U.S. and non-U.S. suppliers and commodity markets, including the
effect of sanctions, tariffs, delays and disruptions in the
delivery of materials and services to RTX or its suppliers and cost
increases; (6) risks relating to RTX international operations from,
among other things, changes in trade policies and implementation of
sanctions, foreign currency fluctuations, economic conditions,
political factors, sales methods, U.S. or local government
regulations, and our dependence on U.S. government approvals for
international contracts; (7) the condition of the aerospace
industry; (8) potential changes in policy positions or priorities
that emerge from the incoming U.S. presidential administration,
including changes in DoD policies or priorities; (9) the ability of
RTX to attract, train qualify, and retain qualified personnel and
maintain its culture and high ethical standards, and the ability of
our personnel to continue to operate our facilities and businesses
around the world; (10) the scope, nature, timing and challenges of
managing acquisitions, investments, divestitures (including the
pending disposition of Collins' actuation and flight control
business) and other transactions, including the realization of
synergies and opportunities for growth and innovation, the
assumption of liabilities and other risks and incurrence of related
costs and expenses, and risks related to completion of announced
divestitures; (11) compliance with legal, environmental, regulatory
and other requirements, including, among other things, obtaining
regulatory approvals for new technologies and products and export
and import requirements such as the International Traffic in Arms
Regulations and the Export Administration Regulations, anti-bribery
and anticorruption requirements, such as the Foreign Corrupt
Practices Act, industrial cooperation agreement obligations, and
procurement and other regulations in the U.S. and other countries
in which RTX and its businesses operate; (12) the outcome of
pending, threatened and future legal proceedings, investigations,
and other contingencies, including those related to U.S. government
audits and disputes and the potential for suspension or debarment
of U.S. government contracting or export privileges as a result
thereof; (13) risks related to the previously-disclosed deferred
prosecution agreements entered into between the Company and the
Department of Justice (DOJ), the Securities and Exchange Commission
(SEC) administrative order imposed on the Company, and the related
investigations by the SEC and DOJ, and the consent agreement
between the Company and the Department of State; (14) factors that
could impact RTX's ability to engage in desirable capital-raising
or strategic transactions, including its credit rating, capital
structure, levels of indebtedness, and related obligations, capital
expenditures and research and development spending, and capital
deployment strategy including with respect to share repurchases,
and the availability of credit, borrowing costs, credit market
conditions, and other factors; (15) uncertainties associated with
the timing and scope of future repurchases by RTX of its common
stock or declarations of cash dividends, which may be discontinued,
accelerated, suspended or delayed at any time due to various
factors, including market conditions and the level of other
investing activities and uses of cash; (16) risks relating to
realizing expected benefits from, incurring costs for, and
successfully managing, strategic initiatives such as cost
reduction, restructuring, digital transformation and other
operational initiatives; (17) risks of additional tax exposures due
to new tax legislation or other developments in the U.S. and other
countries in which RTX and its businesses operate; (18) risks
relating to addressing the identified rare condition in powder
metal used to manufacture certain Pratt & Whitney engine parts
requiring accelerated removals and inspections of a significant
portion of the PW1100G-JM Geared Turbofan (GTF) fleet, including,
without limitation, the number and expected timing of shop visits,
inspection results and scope of work to be performed, turnaround
time, availability of new parts, available capacity at overhaul
facilities, outcomes of negotiations with impacted customers, and
risks related to other engine models that may be impacted by the
powder metal matter, and in each case the timing and costs relating
thereto, as well as other issues that could impact RTX product
performance, including quality, reliability or durability; (19)
changes in production volumes of one or more of our significant
customers as a result of business, labor, or other challenges, and
the resulting effect on its or their demand for our products and
services; (20) risks relating to an RTX product safety failure,
quality issue or other failure affecting RTX's or its customers' or
suppliers' products or systems; (21) risks relating to
cybersecurity, including cyber-attacks on RTX's information
technology infrastructure, products, suppliers, customers and
partners, and cybersecurity-related regulations; (22) risks related
to insufficient indemnity or insurance coverage; (23) risks related
to artificial intelligence; (24) risks relating to our intellectual
property and certain third-party intellectual property; (25)
threats to RTX facilities and personnel, as well as other events
outside of RTX's control such as public health crises, damaging
weather or other acts of nature; (26) the effect of changes in
accounting estimates for our programs on our financial results;
(27) the effect of changes in pension and other postretirement plan
estimates and assumptions and contributions; (28) risks relating to
an impairment of goodwill and other intangible assets; (29) the
effects of climate change and changing climate-related regulations,
customer and market demands, products and technologies; and (30)
the intended qualification of (i) the merger as a tax-free
reorganization and (ii) the separation transactions and other
internal restructurings as tax-free to UTC and former UTC
shareowners, in each case, for U.S. federal income tax purposes.
For additional information on identifying factors that may cause
actual results to vary materially from those stated in
forward-looking statements, see the reports of RTX, UTC and
Raytheon on Forms S-4, 10-K, 10-Q and 8-K filed with or furnished
to the Securities and Exchange Commission from time to time. Any
forward-looking statement speaks only as of the date on which it is
made, and RTX assumes no obligation to update or revise such
statement, whether as a result of new information, future events or
otherwise, except as required by applicable law.
|
RTX
Corporation
Consolidated Statement of
Operations
|
|
|
|
Quarter Ended
December 31,
|
|
Twelve Months Ended
December 31,
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(dollars in
millions, except per share amounts; shares in
millions)
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Net Sales
|
$ 21,623
|
|
$ 19,927
|
|
$ 80,738
|
|
$ 68,920
|
|
Costs and
expenses:
|
|
|
|
|
|
|
|
|
Cost of
sales
|
17,388
|
|
15,918
|
|
65,328
|
|
56,831
|
|
Research and
development
|
808
|
|
757
|
|
2,934
|
|
2,805
|
|
Selling, general, and
administrative
|
1,574
|
|
1,445
|
|
5,806
|
|
5,809
|
|
Total costs and
expenses
|
19,770
|
|
18,120
|
|
74,068
|
|
65,445
|
|
Other income (expense),
net
|
258
|
|
(30)
|
|
(132)
|
|
86
|
|
Operating
profit
|
2,111
|
|
1,777
|
|
6,538
|
|
3,561
|
|
Non-service pension
income
|
(384)
|
|
(446)
|
|
(1,518)
|
|
(1,780)
|
|
Interest expense,
net
|
486
|
|
488
|
|
1,862
|
|
1,505
|
|
Income before income
taxes
|
2,009
|
|
1,735
|
|
6,194
|
|
3,836
|
|
Income tax
expense
|
449
|
|
262
|
|
1,181
|
|
456
|
|
Net income
|
1,560
|
|
1,473
|
|
5,013
|
|
3,380
|
|
Less: Noncontrolling
interest in subsidiaries' earnings
|
78
|
|
47
|
|
239
|
|
185
|
|
Net income attributable
to common shareowners
|
$
1,482
|
|
$
1,426
|
|
$
4,774
|
|
$
3,195
|
|
|
|
|
|
|
|
|
|
|
Earnings Per Share
attributable to common shareowners:
|
|
|
|
|
|
|
|
|
Basic
|
$
1.11
|
|
$
1.05
|
|
$
3.58
|
|
$
2.24
|
|
Diluted
|
$
1.10
|
|
$
1.05
|
|
$
3.55
|
|
$
2.23
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Shares
Outstanding:
|
|
|
|
|
|
|
|
|
Basic shares
|
1,334.4
|
|
1,354.9
|
|
1,332.1
|
|
1,426.0
|
|
Diluted
shares
|
1,348.9
|
|
1,361.7
|
|
1,343.6
|
|
1,435.4
|
|
RTX
Corporation
Segment Net Sales
and Operating Profit (Loss)
|
|
|
Quarter
Ended
|
|
Twelve Months
Ended
|
|
(Unaudited)
|
|
(Unaudited)
|
|
December 31,
2024
|
|
December 31,
2023
|
|
December 31,
2024
|
|
December 31,
2023
|
|
(dollars in
millions)
|
Reported
|
Adjusted
|
|
Reported
|
Adjusted
|
|
Reported
|
Adjusted
|
|
Reported
|
Adjusted
|
|
Net
Sales
|
|
|
|
|
|
|
|
|
|
|
|
|
Collins
Aerospace
|
$
7,537
|
$
7,537
|
|
$
7,120
|
$
7,008
|
|
$
28,284
|
$
28,284
|
|
$
26,253
|
$
26,198
|
|
Pratt &
Whitney
|
7,569
|
7,569
|
|
6,439
|
6,439
|
|
28,066
|
28,066
|
|
18,296
|
23,697
|
|
Raytheon
|
7,157
|
7,157
|
|
6,886
|
6,886
|
|
26,713
|
26,783
|
|
26,350
|
26,350
|
|
Total
segments
|
22,263
|
22,263
|
|
20,445
|
20,333
|
|
83,063
|
83,133
|
|
70,899
|
76,245
|
|
Eliminations and
other
|
(640)
|
(640)
|
|
(518)
|
(509)
|
|
(2,325)
|
(2,325)
|
|
(1,979)
|
(1,940)
|
|
Consolidated
|
$
21,623
|
$
21,623
|
|
$
19,927
|
$
19,824
|
|
$
80,738
|
$
80,808
|
|
$
68,920
|
$
74,305
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Profit
(Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
Collins
Aerospace
|
$
1,106
|
$
1,207
|
|
$
1,126
|
$
1,035
|
|
$
4,135
|
$
4,496
|
|
$
3,825
|
$
3,896
|
|
Pratt &
Whitney
|
504
|
717
|
|
382
|
405
|
|
2,015
|
2,281
|
|
(1,455)
|
1,688
|
|
Raytheon
|
824
|
728
|
|
604
|
618
|
|
2,594
|
2,728
|
|
2,379
|
2,434
|
|
Total
segments
|
2,434
|
2,652
|
|
2,112
|
2,058
|
|
8,744
|
9,505
|
|
4,749
|
8,018
|
|
Eliminations and
other
|
7
|
7
|
|
(8)
|
1
|
|
(48)
|
(48)
|
|
(42)
|
(81)
|
|
Corporate expenses and
other unallocated items
|
(7)
|
(4)
|
|
(110)
|
(70)
|
|
(933)
|
(107)
|
|
(275)
|
(169)
|
|
FAS/CAS operating
adjustment
|
197
|
197
|
|
282
|
282
|
|
833
|
833
|
|
1,127
|
1,127
|
|
Acquisition accounting
adjustments
|
(520)
|
—
|
|
(499)
|
—
|
|
(2,058)
|
—
|
|
(1,998)
|
—
|
|
Consolidated
|
$
2,111
|
$
2,852
|
|
$
1,777
|
$
2,271
|
|
$
6,538
|
$
10,183
|
|
$
3,561
|
$
8,895
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment Operating
Profit (Loss) Margin
|
|
|
|
|
|
|
|
|
|
|
Collins
Aerospace
|
14.7 %
|
16.0 %
|
|
15.8 %
|
14.8 %
|
|
14.6 %
|
15.9 %
|
|
14.6 %
|
14.9 %
|
|
Pratt &
Whitney
|
6.7 %
|
9.5 %
|
|
5.9 %
|
6.3 %
|
|
7.2 %
|
8.1 %
|
|
(8.0) %
|
7.1 %
|
|
Raytheon
|
11.5 %
|
10.2 %
|
|
8.8 %
|
9.0 %
|
|
9.7 %
|
10.2 %
|
|
9.0 %
|
9.2 %
|
|
Total
segment
|
10.9 %
|
11.9 %
|
|
10.3 %
|
10.1 %
|
|
10.5 %
|
11.4 %
|
|
6.7 %
|
10.5 %
|
|
RTX
Corporation
Consolidated Balance
Sheet
|
|
|
December 31,
2024
|
|
December 31,
2023
|
|
(dollars in
millions)
|
(Unaudited)
|
|
(Unaudited)
|
|
Assets
|
|
|
|
|
Cash and cash
equivalents
|
$
5,578
|
|
$
6,587
|
|
Accounts receivable,
net
|
10,976
|
|
10,838
|
|
Contract
assets
|
14,570
|
|
12,139
|
|
Inventory,
net
|
12,768
|
|
11,777
|
|
Other assets,
current
|
7,241
|
|
7,076
|
|
Total current
assets
|
51,133
|
|
48,417
|
|
Customer financing
assets
|
2,246
|
|
2,392
|
|
Fixed assets,
net
|
16,089
|
|
15,748
|
|
Operating lease
right-of-use assets
|
1,864
|
|
1,638
|
|
Goodwill
|
52,789
|
|
53,699
|
|
Intangible assets,
net
|
33,443
|
|
35,399
|
|
Other assets
|
5,297
|
|
4,576
|
|
Total
assets
|
$
162,861
|
|
$
161,869
|
|
|
|
|
|
Liabilities,
Redeemable Noncontrolling Interest, and Equity
|
|
|
|
|
Short-term
borrowings
|
$
183
|
|
$
189
|
|
Accounts
payable
|
12,897
|
|
10,698
|
|
Accrued employee
compensation
|
2,620
|
|
2,491
|
|
Other accrued
liabilities
|
14,831
|
|
14,917
|
|
Contract
liabilities
|
18,616
|
|
17,183
|
|
Long-term debt
currently due
|
2,352
|
|
1,283
|
|
Total current
liabilities
|
51,499
|
|
46,761
|
|
Long-term
debt
|
38,726
|
|
42,355
|
|
Operating lease
liabilities, non-current
|
1,632
|
|
1,412
|
|
Future pension and
postretirement benefit obligations
|
2,104
|
|
2,385
|
|
Other long-term
liabilities
|
6,942
|
|
7,511
|
|
Total
liabilities
|
100,903
|
|
100,424
|
|
Redeemable
noncontrolling interest
|
35
|
|
35
|
|
Shareowners'
Equity:
|
|
|
|
|
Common
stock
|
37,434
|
|
37,040
|
|
Treasury
stock
|
(27,112)
|
|
(26,977)
|
|
Retained
earnings
|
53,589
|
|
52,154
|
|
Accumulated other
comprehensive loss
|
(3,755)
|
|
(2,419)
|
|
Total shareowners'
equity
|
60,156
|
|
59,798
|
|
Noncontrolling
interest
|
1,767
|
|
1,612
|
|
Total
equity
|
61,923
|
|
61,410
|
|
Total liabilities,
redeemable noncontrolling interest, and equity
|
$
162,861
|
|
$
161,869
|
|
RTX
Corporation
Consolidated Statement of Cash
Flows
|
|
|
Quarter Ended
December 31,
|
|
Twelve Months
Ended
December 31,
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(dollars in
millions)
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Operating
Activities:
|
|
|
|
|
|
|
|
|
Net income
|
$ 1,560
|
|
$ 1,473
|
|
$
5,013
|
|
$
3,380
|
|
Adjustments to
reconcile net income to net cash flows provided by operating
activities from:
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
1,139
|
|
1,059
|
|
4,364
|
|
4,211
|
|
Deferred income tax
(benefit) provision
|
72
|
|
326
|
|
(47)
|
|
(402)
|
|
Stock compensation
cost
|
109
|
|
106
|
|
437
|
|
425
|
|
Net periodic pension
and other postretirement income
|
(334)
|
|
(391)
|
|
(1,326)
|
|
(1,555)
|
|
Gain on sale of
Cybersecurity, Intelligence and Services business, net of
transaction costs
|
—
|
|
—
|
|
(415)
|
|
—
|
|
Change in:
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
(1,111)
|
|
(892)
|
|
(175)
|
|
(1,805)
|
|
Contract
assets
|
39
|
|
410
|
|
(2,414)
|
|
(753)
|
|
Inventory
|
231
|
|
326
|
|
(1,474)
|
|
(1,104)
|
|
Other current
assets
|
(160)
|
|
(283)
|
|
(402)
|
|
(1,161)
|
|
Accounts payable and
accrued liabilities
|
(819)
|
|
594
|
|
1,508
|
|
4,016
|
|
Contract
liabilities
|
676
|
|
1,893
|
|
1,872
|
|
2,322
|
|
Other operating
activities, net
|
159
|
|
90
|
|
218
|
|
309
|
|
Net cash flows
provided by operating activities
|
1,561
|
|
4,711
|
|
7,159
|
|
7,883
|
|
Investing
Activities:
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
(1,069)
|
|
(805)
|
|
(2,625)
|
|
(2,415)
|
|
Dispositions of
businesses, net of cash transferred
|
512
|
|
—
|
|
1,795
|
|
6
|
|
Increase in other
intangible assets
|
(164)
|
|
(215)
|
|
(611)
|
|
(751)
|
|
(Payments) receipts
from settlements of derivative contracts, net
|
(145)
|
|
32
|
|
(142)
|
|
14
|
|
Other investing
activities, net
|
87
|
|
10
|
|
49
|
|
107
|
|
Net cash flows used in
investing activities
|
(779)
|
|
(978)
|
|
(1,534)
|
|
(3,039)
|
|
Financing
Activities:
|
|
|
|
|
|
|
|
|
Proceeds from
long-term debt
|
—
|
|
9,940
|
|
—
|
|
12,914
|
|
Repayment of long-term
debt
|
(800)
|
|
(403)
|
|
(2,500)
|
|
(578)
|
|
Proceeds from bridge
loan
|
—
|
|
10,000
|
|
—
|
|
10,000
|
|
Repayment of bridge
loan
|
—
|
|
(10,000)
|
|
—
|
|
(10,000)
|
|
Change in commercial
paper, net
|
—
|
|
(997)
|
|
—
|
|
(524)
|
|
Change in other
short-term borrowings, net
|
(35)
|
|
19
|
|
(4)
|
|
87
|
|
Dividends paid on
common stock
|
(802)
|
|
(767)
|
|
(3,217)
|
|
(3,239)
|
|
Repurchase of common
stock
|
(50)
|
|
(10,283)
|
|
(444)
|
|
(12,870)
|
|
Other financing
activities, net
|
(181)
|
|
(127)
|
|
(452)
|
|
(317)
|
|
Net cash flows used in
financing activities
|
(1,868)
|
|
(2,618)
|
|
(6,617)
|
|
(4,527)
|
|
Effect of foreign
exchange rate changes on cash and cash equivalents
|
(39)
|
|
14
|
|
(28)
|
|
18
|
|
Net increase
(decrease) in cash, cash equivalents and restricted cash
|
(1,125)
|
|
1,129
|
|
(1,020)
|
|
335
|
|
Cash, cash equivalents
and restricted cash, beginning of period
|
6,731
|
|
5,497
|
|
6,626
|
|
6,291
|
|
Cash, cash equivalents
and restricted cash, end of period
|
5,606
|
|
6,626
|
|
5,606
|
|
6,626
|
|
Less: Restricted cash,
included in Other assets, current and Other assets
|
28
|
|
39
|
|
28
|
|
39
|
|
Cash and cash
equivalents, end of period
|
$ 5,578
|
|
$ 6,587
|
|
$
5,578
|
|
$
6,587
|
|
RTX
Corporation
Reconciliation of
Adjusted (Non-GAAP) Results
Adjusted Sales,
Adjusted Operating Profit & Operating Profit
Margin
|
|
|
Quarter Ended
December 31,
|
|
Twelve Months
Ended
December 31,
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(dollars in
millions - Income (Expense))
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Collins
Aerospace
|
|
|
|
|
|
|
|
|
Net sales
|
$ 7,537
|
|
$ 7,120
|
|
$
28,284
|
|
$
26,253
|
|
Benefits related to
litigation matters (1)
|
—
|
|
112
|
|
—
|
|
55
|
|
Adjusted net
sales
|
$ 7,537
|
|
$ 7,008
|
|
$
28,284
|
|
$
26,198
|
|
Operating
profit
|
$ 1,106
|
|
$ 1,126
|
|
$ 4,135
|
|
$ 3,825
|
|
Restructuring
|
(17)
|
|
1
|
|
(47)
|
|
(71)
|
|
Gain on sale of
business, net of transaction and other related costs
(1)
|
99
|
|
—
|
|
99
|
|
—
|
|
Charge associated with
initiating alternative titanium sources (1)
|
—
|
|
—
|
|
(175)
|
|
—
|
|
Segment and portfolio
transformation and divestiture costs (1)
|
(28)
|
|
(29)
|
|
(83)
|
|
(62)
|
|
Benefits related to
litigation matters (1)
|
—
|
|
119
|
|
—
|
|
62
|
|
Impairment of contract
fulfillment costs (1)
|
(155)
|
|
—
|
|
(155)
|
|
—
|
|
Adjusted operating
profit
|
$ 1,207
|
|
$ 1,035
|
|
$ 4,496
|
|
$ 3,896
|
|
Adjusted operating
profit margin
|
16.0 %
|
|
14.8 %
|
|
15.9 %
|
|
14.9 %
|
|
Pratt &
Whitney
|
|
|
|
|
|
|
|
|
Net sales
|
$ 7,569
|
|
$ 6,439
|
|
$
28,066
|
|
$
18,296
|
|
Powder Metal charge
(1)
|
—
|
|
—
|
|
—
|
|
(5,401)
|
|
Adjusted net
sales
|
$ 7,569
|
|
$ 6,439
|
|
$
28,066
|
|
$
23,697
|
|
Operating profit
(loss)
|
$
504
|
|
$
382
|
|
$ 2,015
|
|
$
(1,455)
|
|
Restructuring
|
(56)
|
|
(23)
|
|
(102)
|
|
(74)
|
|
Insurance
settlement
|
—
|
|
—
|
|
27
|
|
—
|
|
Powder Metal charge
(1)
|
—
|
|
—
|
|
—
|
|
(2,888)
|
|
Charges related to a
customer insolvency (1)
|
—
|
|
—
|
|
—
|
|
(181)
|
|
Expected settlement of
a litigation matter (1)
|
—
|
|
—
|
|
(34)
|
|
—
|
|
Customer bankruptcy
(1)
|
(157)
|
|
—
|
|
(157)
|
|
—
|
|
Adjusted operating
profit
|
$
717
|
|
$
405
|
|
$ 2,281
|
|
$ 1,688
|
|
Adjusted operating
profit margin
|
9.5 %
|
|
6.3 %
|
|
8.1 %
|
|
7.1 %
|
|
Raytheon
|
|
|
|
|
|
|
|
|
Net sales
|
$ 7,157
|
|
$ 6,886
|
|
$
26,713
|
|
$
26,350
|
|
Contract termination
(1)
|
—
|
|
—
|
|
(70)
|
|
—
|
|
Adjusted net
sales
|
$ 7,157
|
|
$ 6,886
|
|
$
26,783
|
|
$
26,350
|
|
Operating
profit
|
$
824
|
|
$
604
|
|
$ 2,594
|
|
$ 2,379
|
|
Restructuring
|
(6)
|
|
(9)
|
|
(36)
|
|
(42)
|
|
Gain on sale of
business, net of transaction and other related costs
(1)
|
—
|
|
—
|
|
375
|
|
—
|
|
Segment and portfolio
transformation and divestiture costs (1)
|
—
|
|
(5)
|
|
—
|
|
(13)
|
|
Contract termination
(1)
|
—
|
|
—
|
|
(575)
|
|
—
|
|
Middle East contracts
restart adjustments (1)
|
102
|
|
—
|
|
102
|
|
—
|
|
Adjusted operating
profit
|
$
728
|
|
$
618
|
|
$ 2,728
|
|
$ 2,434
|
|
Adjusted operating
profit margin
|
10.2 %
|
|
9.0 %
|
|
10.2 %
|
|
9.2 %
|
|
Eliminations and
Other
|
|
|
|
|
|
|
|
|
Net sales
|
$ (640)
|
|
$ (518)
|
|
$
(2,325)
|
|
$
(1,979)
|
|
Prior year impact from
R&D capitalization IRS notice (1)
|
—
|
|
(9)
|
|
—
|
|
(39)
|
|
Adjusted net
sales
|
$ (640)
|
|
$ (509)
|
|
$
(2,325)
|
|
$
(1,940)
|
|
Operating profit
(loss)
|
$
7
|
|
$
(8)
|
|
$
(48)
|
|
$
(42)
|
|
Prior year impact from
R&D capitalization IRS notice (1)
|
—
|
|
(9)
|
|
—
|
|
(39)
|
|
Gain on sale of
land
|
—
|
|
—
|
|
—
|
|
68
|
|
Charges related to a
customer insolvency (1)
|
—
|
|
—
|
|
—
|
|
10
|
|
Adjusted operating
profit (loss)
|
$
7
|
|
$
1
|
|
$
(48)
|
|
$
(81)
|
|
Corporate expenses
and other unallocated items
|
|
|
|
|
|
|
|
|
Operating
loss
|
$
(7)
|
|
$ (110)
|
|
$ (933)
|
|
$ (275)
|
|
Restructuring
|
—
|
|
(13)
|
|
(9)
|
|
(59)
|
|
Tax audit settlements
(1)
|
—
|
|
—
|
|
(68)
|
|
—
|
|
Segment and portfolio
transformation and divestiture costs (1)
|
(3)
|
|
(11)
|
|
(11)
|
|
(31)
|
|
Legal matters
(1)
|
—
|
|
—
|
|
(918)
|
|
—
|
|
Expiration of tax
statute of limitations
|
—
|
|
(16)
|
|
—
|
|
(16)
|
|
Tax matters and
related indemnification (1)
|
—
|
|
—
|
|
180
|
|
—
|
|
Adjusted operating
loss
|
$
(4)
|
|
$
(70)
|
|
$ (107)
|
|
$ (169)
|
|
FAS/CAS Operating
Adjustment
|
|
|
|
|
|
|
|
|
Operating
profit
|
$
197
|
|
$
282
|
|
$
833
|
|
$ 1,127
|
|
Acquisition
Accounting Adjustments
|
|
|
|
|
|
|
|
|
Operating
loss
|
$ (520)
|
|
$ (499)
|
|
$
(2,058)
|
|
$
(1,998)
|
|
Acquisition accounting
adjustments
|
(520)
|
|
(499)
|
|
(2,058)
|
|
(1,998)
|
|
Adjusted operating
profit
|
$
—
|
|
$
—
|
|
$
—
|
|
$
—
|
|
RTX
Consolidated
|
|
|
|
|
|
|
|
|
Net sales
|
$
21,623
|
|
$
19,927
|
|
$
80,738
|
|
$
68,920
|
|
Total net significant
and/or non-recurring items included in Net sales above
(1)
|
—
|
|
103
|
|
(70)
|
|
(5,385)
|
|
Adjusted net
sales
|
$
21,623
|
|
$
19,824
|
|
$
80,808
|
|
$
74,305
|
|
Operating
profit
|
$ 2,111
|
|
$ 1,777
|
|
$ 6,538
|
|
$ 3,561
|
|
Restructuring
|
(79)
|
|
(44)
|
|
(194)
|
|
(246)
|
|
Acquisition accounting
adjustments
|
(520)
|
|
(499)
|
|
(2,058)
|
|
(1,998)
|
|
Total net significant
and/or non-recurring items included in Operating profit above
(1)
|
(142)
|
|
49
|
|
(1,393)
|
|
(3,090)
|
|
Adjusted operating
profit
|
$ 2,852
|
|
$ 2,271
|
|
$
10,183
|
|
$ 8,895
|
|
|
|
(1)
|
Refer to "Non-GAAP
Financial Adjustments" below for a description of these
adjustments.
|
|
RTX
Corporation
Reconciliation of
Adjusted (Non-GAAP) Results
Adjusted Income,
Earnings Per Share, and Effective Tax Rate
|
|
|
Quarter Ended
December 31,
|
|
Twelve Months
Ended December 31,
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(dollars in
millions - Income (Expense))
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Net income
attributable to common shareowners
|
$
1,482
|
|
$
1,426
|
|
$ 4,774
|
|
$ 3,195
|
|
Total
Restructuring
|
(79)
|
|
(44)
|
|
(194)
|
|
(246)
|
|
Total Acquisition
accounting adjustments
|
(520)
|
|
(499)
|
|
(2,058)
|
|
(1,998)
|
|
Total net significant
and/or non-recurring items included in Operating profit
(1)
|
(142)
|
|
49
|
|
(1,393)
|
|
(3,090)
|
|
Significant and/or
non-recurring items included in Non-service Pension
Income
|
|
|
|
|
|
|
|
|
Non-service pension
restructuring
|
—
|
|
(2)
|
|
(9)
|
|
(4)
|
|
Pension curtailment
related to sale of business (1)
|
—
|
|
—
|
|
9
|
|
—
|
|
Significant
non-recurring and non-operational items included in Interest
Expense, Net
|
|
|
|
|
|
|
|
|
Tax audit settlements
(1)
|
—
|
|
—
|
|
78
|
|
—
|
|
Benefits related to
litigation matters
|
—
|
|
1
|
|
—
|
|
1
|
|
Expiration of tax
statute of limitations
|
—
|
|
10
|
|
—
|
|
10
|
|
Tax matters and
related indemnification (1)
|
—
|
|
—
|
|
(11)
|
|
—
|
|
Tax effect of
restructuring and net significant and/or non-recurring items
above
|
152
|
|
99
|
|
516
|
|
1,191
|
|
Significant and/or
non-recurring items included in Income Tax Expense
|
|
|
|
|
|
|
|
|
Tax audit settlements
(1)
|
—
|
|
—
|
|
296
|
|
—
|
|
Expiration of tax
statute of limitations
|
—
|
|
61
|
|
—
|
|
61
|
|
Prior year impact from
R&D capitalization IRS notice (1)
|
—
|
|
(5)
|
|
—
|
|
(13)
|
|
Tax matters and
related indemnification (1)
|
—
|
|
—
|
|
(156)
|
|
—
|
|
Significant and/or
non-recurring items included in Noncontrolling
Interest
|
|
|
|
|
|
|
|
|
Noncontrolling
interest share of charges related to an insurance
settlement
|
—
|
|
—
|
|
(9)
|
|
—
|
|
Noncontrolling
interest share of benefits related to litigation matters
(1)
|
—
|
|
3
|
|
—
|
|
3
|
|
Noncontrolling
interest share of customer insolvency charges
(1)
|
—
|
|
—
|
|
—
|
|
17
|
|
Less: Impact on net
income (loss) attributable to common shareowners
|
(589)
|
|
(327)
|
|
(2,931)
|
|
(4,068)
|
|
Adjusted net income
attributable to common shareowners
|
$
2,071
|
|
$
1,753
|
|
$ 7,705
|
|
$ 7,263
|
|
|
|
|
|
|
|
|
|
Diluted Earnings Per
Share
|
$
1.10
|
|
$
1.05
|
|
$
3.55
|
|
$
2.23
|
|
Impact on Diluted
Earnings Per Share
|
(0.44)
|
|
(0.24)
|
|
(2.18)
|
|
(2.83)
|
|
Adjusted Diluted
Earnings Per Share
|
$
1.54
|
|
$
1.29
|
|
$
5.73
|
|
$
5.06
|
|
|
|
|
|
|
|
|
|
Effective Tax
Rate
|
22.3 %
|
|
15.1 %
|
|
19.1 %
|
|
11.9 %
|
|
Impact on Effective
Tax Rate
|
0.4 %
|
|
(3.7) %
|
|
0.3 %
|
|
(6.6) %
|
|
Adjusted Effective
Tax Rate
|
21.9 %
|
|
18.8 %
|
|
18.8 %
|
|
18.5 %
|
|
|
|
(1)
|
Refer to "Non-GAAP
Financial Adjustments" below for a description of these
adjustments.
|
|
RTX
Corporation
Reconciliation of
Adjusted (Non-GAAP) Results
Segment Operating
Profit Margin and Adjusted Segment Operating Profit
Margin
|
|
|
Quarter Ended
December 31,
|
|
Twelve Months
Ended
December 31,
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(dollars in
millions)
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
Net
Sales
|
$
21,623
|
|
$
19,927
|
|
$
80,738
|
|
$
68,920
|
|
Reconciliation to
segment net sales:
|
|
|
|
|
|
|
|
|
Eliminations and
other
|
640
|
|
518
|
|
2,325
|
|
1,979
|
|
Segment Net
Sales
|
$
22,263
|
|
$
20,445
|
|
$
83,063
|
|
$
70,899
|
|
Reconciliation to
adjusted segment net sales:
|
|
|
|
|
|
|
|
|
Net significant and/or
non-recurring items (1)
|
—
|
|
112
|
|
(70)
|
|
(5,346)
|
|
Adjusted Segment Net
Sales
|
$
22,263
|
|
$
20,333
|
|
$
83,133
|
|
$
76,245
|
|
|
|
|
|
|
|
|
|
Operating
Profit
|
$ 2,111
|
|
$ 1,777
|
|
$ 6,538
|
|
$ 3,561
|
|
Operating Profit
Margin
|
9.8 %
|
|
8.9 %
|
|
8.1 %
|
|
5.2 %
|
|
Reconciliation to
segment operating profit:
|
|
|
|
|
|
|
|
|
Eliminations and
other
|
(7)
|
|
8
|
|
48
|
|
42
|
|
Corporate expenses and
other unallocated items
|
7
|
|
110
|
|
933
|
|
275
|
|
FAS/CAS operating
adjustment
|
(197)
|
|
(282)
|
|
(833)
|
|
(1,127)
|
|
Acquisition accounting
adjustments
|
520
|
|
499
|
|
2,058
|
|
1,998
|
|
Segment Operating
Profit
|
$ 2,434
|
|
$ 2,112
|
|
$ 8,744
|
|
$ 4,749
|
|
Segment Operating
Profit Margin
|
10.9 %
|
|
10.3 %
|
|
10.5 %
|
|
6.7 %
|
|
Reconciliation to
adjusted segment operating profit:
|
|
|
|
|
|
|
|
|
Restructuring
|
(79)
|
|
(31)
|
|
(185)
|
|
(187)
|
|
Net significant and/or
non-recurring items (1)
|
(139)
|
|
85
|
|
(576)
|
|
(3,082)
|
|
Adjusted Segment
Operating Profit
|
$ 2,652
|
|
$ 2,058
|
|
$ 9,505
|
|
$ 8,018
|
|
Adjusted Segment
Operating Profit Margin
|
11.9 %
|
|
10.1 %
|
|
11.4 %
|
|
10.5 %
|
|
|
|
(1)
|
Refer to "Non-GAAP
Financial Adjustments" below for a description of these
adjustments.
|
|
RTX
Corporation
Free Cash Flow
Reconciliation
|
|
|
Quarter Ended
December 31,
|
|
(Unaudited)
|
|
(dollars in
millions)
|
2024
|
|
2023
|
|
Net cash flows provided
by operating activities
|
$
1,561
|
|
$
4,711
|
|
Capital
expenditures
|
(1,069)
|
|
(805)
|
|
Free cash
flow
|
$
492
|
|
$
3,906
|
|
|
|
|
|
Twelve Months Ended
December 31,
|
|
(Unaudited)
|
|
(dollars in
millions)
|
2024
|
|
2023
|
|
Net cash flows provided
by operating activities
|
$
7,159
|
|
$
7,883
|
|
Capital
expenditures
|
(2,625)
|
|
(2,415)
|
|
Free cash
flow
|
$
4,534
|
|
$
5,468
|
|
RTX
Corporation
Reconciliation of
Adjusted (Non-GAAP) Results
Organic Sales
Reconciliation
|
|
|
Quarter ended
December 31, 2024 compared to the Quarter Ended
December 31, 2023
|
|
(Unaudited)
|
|
(dollars in
millions)
|
Total Reported
Change
|
Acquisitions
&
Divestitures
Change
|
FX / Other
Change (2)
|
Organic
Change
|
|
Prior Year
Adjusted Sales (1)
|
Organic Change
as a % of
Adjusted Sales
|
|
Collins
Aerospace
|
$
417
|
$
(18)
|
$
(107)
|
$
542
|
|
$
7,008
|
8 %
|
|
Pratt &
Whitney
|
1,130
|
—
|
(25)
|
1,155
|
|
6,439
|
18 %
|
|
Raytheon
|
271
|
(412)
|
8
|
675
|
|
6,886
|
10 %
|
|
Eliminations and Other
(3)
|
(122)
|
1
|
22
|
(145)
|
|
(509)
|
28 %
|
|
Consolidated
|
$
1,696
|
$
(429)
|
$
(102)
|
$
2,227
|
|
$
19,824
|
11 %
|
|
|
|
(1)
|
For the full Non-GAAP
reconciliation of adjusted sales refer to "Reconciliation of
Adjusted (Non-GAAP) Results - Adjusted Sales, Adjusted Operating
Profit & Operating Profit Margin."
|
|
(2)
|
Includes other
significant non-operational items and/or significant operational
items that may occur at irregular intervals.
|
|
(3)
|
FX/Other Change
includes the transactional impact of foreign exchange hedging at
Pratt & Whitney Canada, which is included in Pratt &
Whitney's FX/Other Change, but excluded for Consolidated
RTX.
|
|
Twelve Months Ended
December 31, 2024 compared to the Twelve Months
Ended December 31, 2023
|
|
(Unaudited)
|
|
(dollars in
millions)
|
Total Reported
Change
|
Acquisitions
&
Divestitures
Change
|
FX / Other
Change (2)
|
Organic
Change
|
|
Prior Year
Adjusted Sales (1)
|
Organic Change
as a % of
Adjusted Sales
|
|
Collins
Aerospace
|
$
2,031
|
$
(18)
|
$
(47)
|
$
2,096
|
|
$
26,198
|
8 %
|
|
Pratt &
Whitney
|
9,770
|
—
|
5,384
|
4,386
|
|
23,697
|
19 %
|
|
Raytheon
|
363
|
(1,274)
|
(54)
|
1,691
|
|
26,350
|
6 %
|
|
Eliminations and Other
(3)
|
(346)
|
1
|
10
|
(357)
|
|
(1,940)
|
18 %
|
|
Consolidated
|
$
11,818
|
$
(1,291)
|
$
5,293
|
$
7,816
|
|
$
74,305
|
11 %
|
|
|
|
(1)
|
For the full Non-GAAP
reconciliation of adjusted sales refer to "Reconciliation of
Adjusted (Non-GAAP) Results - Adjusted Sales, Adjusted Operating
Profit & Operating Profit Margin."
|
|
(2)
|
Includes other
significant non-operational items and/or significant operational
items that may occur at irregular intervals.
|
|
(3)
|
FX/Other Change
includes the transactional impact of foreign exchange hedging at
Pratt & Whitney Canada, which is included in Pratt &
Whitney's FX/Other Change, but excluded for Consolidated
RTX.
|
Non-GAAP Financial Adjustments
|
Non-GAAP
Adjustments
|
Description
|
|
Benefits related to
litigation matters
|
The quarter and twelve
months ended December 31, 2023 includes a net sales benefit of $112
million and $55 million, respectively and a corresponding net
operating profit benefit of $119 million and $62 million,
respectively related to the settlement of two customer litigation
matters at Collins. Management has determined that the nature and
significance of these settlements are considered unusual and
therefore, not indicative of the Company's ongoing operational
performance.
|
|
Segment and portfolio
transformation and divestiture costs
|
The quarters and twelve
months ended December 31, 2024 and 2023 include certain segment and
portfolio transformation costs incurred in connection with the 2023
completed segment realignment as well as separation costs incurred
in advance of the completion of certain
divestitures.
|
|
Charge associated with
initiating alternative titanium sources
|
The twelve months ended
December 31, 2024 includes a net pre-tax charge of $0.2
billion related to the recognition of unfavorable purchase
commitments and an impairment of contract fulfillment costs
associated with initiating alternative titanium sources at Collins.
These charges were recorded as a result of the Canadian
government's imposition of new sanctions in February 2024, which
included U.S.- and German-based Russian-owned entities from which
we source titanium for use in our Canadian operations. Management
has determined that these impacts are directly attributable to the
sanctions, incremental to similar costs incurred for reasons other
than those related to the sanctions and has determined that the
nature of the charge is considered significant and unusual, and
therefore, not indicative of the Company's ongoing operational
performance.
|
|
Impairment of contract
fulfillment costs
|
The quarter and twelve
months ended December 31, 2024 include a net pre-tax charge of $0.2
billion related to an impairment of contract fulfillment costs as a
result of a contract cancellation during the fourth quarter of 2024
at Collins. Management has determined that the nature and
significance of the charge is considered unusual and, therefore not
indicative of the Company's ongoing operational
performance.
|
|
Powder Metal
charge
|
The twelve months ended
December 31, 2023 includes a net pre-tax charge of $2.9 billion
related to the Pratt powder metal matter during the third quarter
of 2023. The charge is reflected in the Consolidated Statement of
Operations as a reduction of sales of $5.4 billion which was
partially offset by a net reduction of cost of sales of $2.5
billion primarily representing our partners' 49% share of this
charge. The charge includes the Company's current best estimate of
expected customer compensation for the estimated duration of the
disruption as well as the third quarter Estimate-at-Completion
(EAC) adjustment impact of this matter to Pratt & Whitney's
long-term maintenance contracts. Management has determined that
these items are directly attributable to the powder metal matter,
incremental to similar costs (or income) incurred for reasons other
than those related to the powder metal matter and not expected to
recur, and therefore, not indicative of the Company's ongoing
operational performance.
|
|
Charge related to a
customer insolvency
|
The twelve months ended
December 31, 2023 includes a net pre-tax charge of $0.2 billion
related to a customer insolvency during the second quarter of 2023.
The charge primarily relates to Contract assets and Customer
financing assets exposures with the customer. Management has
determined that the nature and significance of the charge is
considered unusual and, therefore not indicative of the Company's
ongoing operational performance.
|
|
Expected settlement of
a litigation matter
|
The twelve months ended
December 31, 2024 includes a pre-tax charge of $34 million
reflecting the expected settlement value relating to a litigation
matter at Pratt & Whitney. Management has determined that the
impact is directly attributable to the expected legal settlement
and that the nature of the charge is considered non-operational and
therefore, not indicative of the Company's ongoing operational
performance.
|
|
Customer
bankruptcy
|
The quarter and twelve
months ended December 31, 2024 include a net pre-tax charge of
approximately $0.2 billion related to a customer bankruptcy during
the fourth quarter of 2024 at Pratt & Whitney. The charge
primarily relates to contract asset exposures with the customer.
Management has determined that the nature and significance of the
charge is considered unusual and, therefore not indicative of the
Company's ongoing operational performance.
|
|
Contract
termination
|
The twelve months ended
December 31, 2024 includes a pre-tax charge of $0.6 billion
related to the termination of a fixed price development contract
with a foreign customer at Raytheon. The charge includes the
write-off of remaining contract assets and settlement with the
customer. Management has determined that these impacts are directly
attributable to the termination, incremental to similar costs
incurred for reasons other than those attributable to the
termination and has determined that the nature of the pre-tax
charge is considered significant and unusual and therefore, not
indicative of the Company's ongoing operational
performance.
|
|
Gain on sale of
business, net of transaction and other related costs
|
The quarter and twelve
months ended December 31, 2024 includes a pre-tax gain, net of
transaction and other related costs, of $0.1 billion associated
with the completed sale of the Hoist & Winch business at
Collins. The twelve months ended December 31, 2024 also
includes a pre-tax gain, net of transaction and other related
costs, of $0.4 billion associated with the completed sale of the
Cybersecurity, Intelligence and Services (CIS) business at
Raytheon. Management has determined that the nature of these net
gains on the divestitures is considered significant and
non-operational and therefore, not indicative of the Company's
ongoing operational performance.
|
|
Middle East contracts
restart adjustments
|
The quarter and twelve
months ended December 31, 2024 includes a net operating profit
benefit of $0.1 billion primarily related to reserve and contract
loss provision adjustments as a result of restarting work under
certain contracts with a Middle East customer. Management has
determined that the nature and significance of the benefit is
considered unusual, therefore not indicative of the Company's
ongoing operational performance.
|
|
Prior year impact from
R&D capitalization IRS notice
|
The quarter and twelve
months ended December 31, 2023 includes a net pre-tax charge of $9
million and $39 million, respectively and a tax expense increase of
$5 million and $13 million, respectively related to the 2022 impact
of an IRS notice issued in September 2023 related to the
capitalization of research and experimental expenditures for tax
purposes. Management has determined that these items are directly
attributable to the IRS notice and represents the impact to 2022,
incremental to similar costs (or income) incurred for reasons other
than the tax law change and not expected to recur, and therefore,
not indicative of the Company's ongoing operational
performance.
|
|
Tax audit
settlements
|
The twelve months ended
December 31, 2024 includes a tax benefit of $0.3 billion
recognized as a result of the closure of the examination phase of
multiple federal tax audits. In addition, there was a pre-tax
charge of $68 million for the write-off of certain tax related
indemnity receivables and a pre-tax gain on the reversal of $78
million of interest accruals, both directly associated with these
tax audit settlements. Management has determined that the nature of
these impacts related to the tax audit settlements is considered
significant and non-operational and therefore, not indicative of
the Company's ongoing operational performance.
|
|
Legal
matters
|
The twelve months ended
December 31, 2024 includes charges of $0.9 billion related to
the expected resolution of several outstanding legal matters. The
charge includes an additional accrual of $0.3 billion to resolve
the previously disclosed criminal and civil government
investigations of defective pricing claims for certain legacy
Raytheon Company contracts entered into between 2011 and 2013 and
in 2017; an additional accrual of $0.4 billion to resolve the
previously disclosed criminal and civil government investigations
of improper payments made by Raytheon Company and its joint
venture, Thales-Raytheon Systems, in connection with certain Middle
East contracts since 2012; and an accrual of $0.3 billion related
to certain voluntarily disclosed export controls violations,
primarily identified in connection with the integration of Rockwell
Collins and, to a lesser extent, Raytheon Company, including
certain violations expected to be resolved pursuant to a consent
agreement with the Department of State. Management has determined
that these impacts are directly attributable to these legacy legal
matters and that the nature of the charges are considered
significant and unusual and therefore, not indicative of the
Company's ongoing operational performance.
|
|
Tax matters and related
indemnification
|
The twelve months ended
December 31, 2024 includes the impact of a recent favorable
international tax court ruling related to certain tax payments made
by a previously separated entity. As a result of this ruling, and
the expected reimbursement of international taxes to the previously
separated entity, the Company will owe additional U.S. income tax
of $0.2 billion and related interest. The Company recorded a
pre-tax benefit of $0.2 billion to recognize recovery of the
additional taxes and interest owed pursuant to a tax matters
agreement entered into in connection with the separation. There was
no net income impact in 2024 as a result of this adjustment. We
also recognized an income tax benefit of $56 million in
response to favorable U.S. Tax Court rulings issued to unrelated
taxpayers, but with facts similar to ours. The nature of the tax
item in the rulings is subject to the tax matters agreement with
previously separated entities and therefore we recorded a pre-tax
charge of $32 million for the indemnified amounts. Management has
determined that the nature of these impacts to both pre-tax income
and income tax expense is considered significant and
non-operational and therefore, not indicative of the Company's
ongoing operational performance.
|
Media Contact
202.384.2474
Investor Contact
781.522.5123
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content:https://www.prnewswire.com/news-releases/rtx-reports-2024-results-and-announces-2025-outlook-302361892.html
SOURCE RTX
