Summary
L3Harris Technologies, Inc. (LHX) reported its fiscal year 2021 results, highlighting a company strategy focused on becoming a technology-focused operating company and a prime contractor for end-to-end mission solutions. The company successfully exceeded its net cost synergy targets from the L3Harris Merger and completed its portfolio reshaping through six divestitures, utilizing proceeds to repurchase shares. Despite a 2% year-over-year revenue decrease to $17.8 billion, primarily attributed to divestitures in Aviation Systems and supply chain constraints in Communication Systems, the company saw a significant 65% increase in income from continuing operations to $1.85 billion, with diluted earnings per share rising 75% to $9.09. This performance reflects strong execution, integration benefits, and a reduction in non-cash impairment charges compared to the previous year. Looking ahead, L3Harris is well-positioned to capitalize on national security priorities and international growth opportunities, supported by investments in R&D and a focus on operational excellence. The company announced a 10% increase in its quarterly cash dividend, underscoring its commitment to shareholder returns. Key financial indicators such as backlog remain robust, and the company is focused on maximizing cash flows for future strategic capital deployment.
Key Highlights
- 1Total revenue for fiscal year 2021 was $17.8 billion, a slight decrease of 2% compared to fiscal year 2020, primarily due to divestitures and supply chain challenges.
- 2Income from continuing operations attributable to L3Harris common shareholders significantly increased by 65% to $1.85 billion in fiscal year 2021.
- 3Diluted earnings per share grew by 75% to $9.09 in fiscal year 2021, driven by higher income and fewer outstanding shares due to repurchases.
- 4The company successfully achieved its net cost synergy targets from the L3Harris Merger, demonstrating effective integration and cost management.
- 5L3Harris completed a portfolio reshaping in fiscal year 2021 by divesting six businesses, generating proceeds that were used for share repurchases.
- 6The company announced a 10% increase in its quarterly cash dividend, raising the annualized rate to $4.48 per share, marking the 21st consecutive annual increase.
- 7Total backlog stood at $21.1 billion at December 31, 2021, with $15.2 billion being funded backlog, indicating continued strong demand for its products and services.