Raytheon Company (RTN) has reported 18.34 percent rise in profit for the quarter ended Oct. 02, 2016. The company has earned $529 million, or $1.79 a share in the quarter, compared with $447 million, or $1.47 a share for the same period last year.
Revenue during the quarter grew 4.32 percent to $6,033 million from $5,783 million in the previous year period. Gross margin for the quarter expanded 143 basis points over the previous year period to 25.21 percent. Total expenses were 86.64 percent of quarterly revenues, down from 87.95 percent for the same period last year. This has led to an improvement of 131 basis points in operating margin to 13.36 percent.
Operating income for the quarter was $806 million, compared with $697 million in the previous year period.
"The Company’s strong operating performance in the third quarter reflects our continued focus on driving global growth and creating value for our customers and shareholders," said Thomas A. Kennedy, Raytheon chairman and chief executive officer.
For financial year 2016, Raytheon Co expects revenue to be in the range of $24,200 million to $24,500 million. The company projects diluted earnings per share to be in the range of $7.28 to $7.38.
Operating cash flow improves
Raytheon Company has generated cash of $1,711 million from operating activities during the nine month period, up 11.61 percent or $178 million, when compared with the last year period.
The company has spent $82 million cash to meet investing activities during the nine month period as against cash outgo of $1,242 million in the last year period. It has incurred net capital expenditure of $366 million on net basis during the nine month period, up 58.44 percent or $135 million from year ago period.
The company has spent $1,615 million cash to carry out financing activities during the nine month period as against cash outgo of $1,060 million in the last year period.
Cash and cash equivalents stood at $2,342 million as on Oct. 02, 2016, down 4.53 percent or $111 million from $2,453 million on Sep. 27, 2015.
Working capital increases sharply
Raytheon Company has recorded an increase in the working capital over the last year. It stood at $4,154 million as at Oct. 02, 2016, up 29.81 percent or $954 million from $3,200 million on Sep. 27, 2015. Current ratio was at 1.69 as on Oct. 02, 2016, up from 1.51 on Sep. 27, 2015.
Cash conversion cycle (CCC) has decreased to 71 days for the quarter from 74 days for the last year period. Days sales outstanding went up to 90 days for the quarter compared with 88 days for the same period last year.
Days inventory outstanding has decreased to 7 days for the quarter compared with 12 days for the previous year period. At the same time, days payable outstanding was almost stable at 26 days for the quarter, when compared with the previous year period.
Debt remains stable
Total debt remained stable at $5,334 million as on Oct. 02, 2016, when compared with the last year. Long-term debt remained stable at $5,334 million as on Oct. 02, 2016, when compared with the last year. Total debt was 18.11 percent of total assets as on Oct. 02, 2016, compared with 18.24 percent on Sep. 27, 2015. Debt to equity ratio was almost stable at 0.51 as on Oct. 02, 2016, when compared with the last year. Interest coverage ratio improved to 13.90 for the quarter from 12.02 for the same period last year.
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