Delaware
|
|
13-1673581
|
||
State or other jurisdiction of incorporation or organization
|
|
I.R.S. employer identification no.
|
||
|
|
|
|
|
|
|
|
|
|
11011 Sunset Hills Road
|
Reston,
|
Virginia
|
|
20190
|
Address of principal executive offices
|
|
Zip code
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
Common Stock
|
GD
|
New York Stock Exchange
|
|
|
|
PART I -
|
PAGE
|
|
Item 1 -
|
|
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
Item 2 -
|
||
Item 3 -
|
||
Item 4 -
|
||
|
||
PART II -
|
||
Item 1 -
|
||
Item 1A -
|
||
Item 2 -
|
||
Item 6 -
|
||
|
|
Three Months Ended
|
||||||
(Dollars in millions, except per-share amounts)
|
June 28, 2020
|
|
June 30, 2019
|
||||
Revenue:
|
|
|
|
||||
Products
|
$
|
5,505
|
|
|
$
|
5,401
|
|
Services
|
3,759
|
|
|
4,154
|
|
||
|
9,264
|
|
|
9,555
|
|
||
Operating costs and expenses:
|
|
|
|
||||
Products
|
(4,603
|
)
|
|
(4,342
|
)
|
||
Services
|
(3,246
|
)
|
|
(3,527
|
)
|
||
General and administrative (G&A)
|
(574
|
)
|
|
(596
|
)
|
||
|
(8,423
|
)
|
|
(8,465
|
)
|
||
Operating earnings
|
841
|
|
|
1,090
|
|
||
Interest, net
|
(132
|
)
|
|
(119
|
)
|
||
Other, net
|
18
|
|
|
12
|
|
||
Earnings before income tax
|
727
|
|
|
983
|
|
||
Provision for income tax, net
|
(102
|
)
|
|
(177
|
)
|
||
Net earnings
|
$
|
625
|
|
|
$
|
806
|
|
|
|
|
|
||||
Earnings per share
|
|
|
|
||||
Basic
|
$
|
2.18
|
|
|
$
|
2.80
|
|
Diluted
|
$
|
2.18
|
|
|
$
|
2.77
|
|
|
Six Months Ended
|
||||||
(Dollars in millions, except per-share amounts)
|
June 28, 2020
|
|
June 30, 2019
|
||||
Revenue:
|
|
|
|
||||
Products
|
$
|
10,395
|
|
|
$
|
10,652
|
|
Services
|
7,618
|
|
|
8,164
|
|
||
|
18,013
|
|
|
18,816
|
|
||
Operating costs and expenses:
|
|
|
|
||||
Products
|
(8,586
|
)
|
|
(8,577
|
)
|
||
Services
|
(6,547
|
)
|
|
(6,925
|
)
|
||
G&A
|
(1,098
|
)
|
|
(1,210
|
)
|
||
|
(16,231
|
)
|
|
(16,712
|
)
|
||
Operating earnings
|
1,782
|
|
|
2,104
|
|
||
Interest, net
|
(239
|
)
|
|
(236
|
)
|
||
Other, net
|
32
|
|
|
30
|
|
||
Earnings before income tax
|
1,575
|
|
|
1,898
|
|
||
Provision for income tax, net
|
(244
|
)
|
|
(347
|
)
|
||
Net earnings
|
$
|
1,331
|
|
|
$
|
1,551
|
|
|
|
|
|
||||
Earnings per share
|
|
|
|
||||
Basic
|
$
|
4.63
|
|
|
$
|
5.39
|
|
Diluted
|
$
|
4.61
|
|
|
$
|
5.33
|
|
|
Three Months Ended
|
Six Months Ended
|
||||||||||||
(Dollars in millions)
|
June 28, 2020
|
|
June 30, 2019
|
June 28, 2020
|
|
June 30, 2019
|
||||||||
Net earnings
|
$
|
625
|
|
|
$
|
806
|
|
$
|
1,331
|
|
|
$
|
1,551
|
|
Gains on cash flow hedges
|
170
|
|
|
51
|
|
71
|
|
|
68
|
|
||||
Foreign currency translation adjustments
|
159
|
|
|
125
|
|
(79
|
)
|
|
156
|
|
||||
Change in retirement plans’ funded status
|
75
|
|
|
59
|
|
152
|
|
|
122
|
|
||||
Other comprehensive income, pretax
|
404
|
|
|
235
|
|
144
|
|
|
346
|
|
||||
Provision for income tax, net
|
(60
|
)
|
|
(28
|
)
|
(52
|
)
|
|
(44
|
)
|
||||
Other comprehensive income, net of tax
|
344
|
|
|
207
|
|
92
|
|
|
302
|
|
||||
Comprehensive income
|
$
|
969
|
|
|
$
|
1,013
|
|
$
|
1,423
|
|
|
$
|
1,853
|
|
|
(Unaudited)
|
|
|
||||
(Dollars in millions)
|
June 28, 2020
|
|
December 31, 2019
|
||||
|
|
|
|
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and equivalents
|
$
|
2,300
|
|
|
$
|
902
|
|
Accounts receivable
|
3,515
|
|
|
3,544
|
|
||
Unbilled receivables
|
7,715
|
|
|
7,857
|
|
||
Inventories
|
6,666
|
|
|
6,306
|
|
||
Other current assets
|
939
|
|
|
1,171
|
|
||
Total current assets
|
21,135
|
|
|
19,780
|
|
||
Noncurrent assets:
|
|
|
|
||||
Property, plant and equipment, net
|
4,721
|
|
|
4,475
|
|
||
Intangible assets, net
|
2,197
|
|
|
2,315
|
|
||
Goodwill
|
19,718
|
|
|
19,677
|
|
||
Other assets
|
2,451
|
|
|
2,594
|
|
||
Total noncurrent assets
|
29,087
|
|
|
29,061
|
|
||
Total assets
|
$
|
50,222
|
|
|
$
|
48,841
|
|
|
|
|
|
||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Short-term debt and current portion of long-term debt
|
$
|
4,121
|
|
|
$
|
2,920
|
|
Accounts payable
|
2,383
|
|
|
3,162
|
|
||
Customer advances and deposits
|
6,212
|
|
|
7,148
|
|
||
Other current liabilities
|
3,890
|
|
|
3,571
|
|
||
Total current liabilities
|
16,606
|
|
|
16,801
|
|
||
Noncurrent liabilities:
|
|
|
|
||||
Long-term debt
|
10,470
|
|
|
9,010
|
|
||
Other liabilities
|
9,256
|
|
|
9,453
|
|
||
Commitments and contingencies (see Note M)
|
|
|
|
|
|
||
Total noncurrent liabilities
|
19,726
|
|
|
18,463
|
|
||
Shareholders’ equity:
|
|
|
|
||||
Common stock
|
482
|
|
|
482
|
|
||
Surplus
|
3,050
|
|
|
3,039
|
|
||
Retained earnings
|
32,294
|
|
|
31,633
|
|
||
Treasury stock
|
(17,809
|
)
|
|
(17,358
|
)
|
||
Accumulated other comprehensive loss
|
(4,127
|
)
|
|
(4,219
|
)
|
||
Total shareholders’ equity
|
13,890
|
|
|
13,577
|
|
||
Total liabilities and shareholders’ equity
|
$
|
50,222
|
|
|
$
|
48,841
|
|
|
Six Months Ended
|
||||||
(Dollars in millions)
|
June 28, 2020
|
|
June 30, 2019
|
||||
Cash flows from operating activities - continuing operations:
|
|
|
|
||||
Net earnings
|
$
|
1,331
|
|
|
$
|
1,551
|
|
Adjustments to reconcile net earnings to net cash from operating activities:
|
|
|
|
||||
Depreciation of property, plant and equipment
|
254
|
|
|
232
|
|
||
Amortization of intangible and finance lease right-of-use assets
|
177
|
|
|
183
|
|
||
Equity-based compensation expense
|
61
|
|
|
72
|
|
||
Deferred income tax benefit
|
(83
|
)
|
|
(17
|
)
|
||
(Increase) decrease in assets, net of effects of business acquisitions:
|
|
|
|
||||
Accounts receivable
|
(1
|
)
|
|
64
|
|
||
Unbilled receivables
|
160
|
|
|
(1,074
|
)
|
||
Inventories
|
(433
|
)
|
|
(556
|
)
|
||
Increase (decrease) in liabilities, net of effects of business acquisitions:
|
|
|
|
||||
Accounts payable
|
(782
|
)
|
|
(301
|
)
|
||
Customer advances and deposits
|
(863
|
)
|
|
(607
|
)
|
||
Other, net
|
356
|
|
|
(51
|
)
|
||
Net cash provided (used) by operating activities
|
177
|
|
|
(504
|
)
|
||
Cash flows from investing activities:
|
|
|
|
||||
Capital expenditures
|
(406
|
)
|
|
(362
|
)
|
||
Other, net
|
184
|
|
|
(1
|
)
|
||
Net cash used by investing activities
|
(222
|
)
|
|
(363
|
)
|
||
Cash flows from financing activities:
|
|
|
|
||||
Proceeds from fixed-rate notes
|
3,960
|
|
|
—
|
|
||
Repayment of fixed-rate notes
|
(2,000
|
)
|
|
—
|
|
||
Proceeds from commercial paper, net
|
816
|
|
|
1,394
|
|
||
Dividends paid
|
(610
|
)
|
|
(563
|
)
|
||
Purchases of common stock
|
(501
|
)
|
|
(231
|
)
|
||
Repayment of floating-rate notes
|
(500
|
)
|
|
—
|
|
||
Proceeds from commercial paper, gross (maturities greater than 3 months)
|
420
|
|
|
—
|
|
||
Other, net
|
(118
|
)
|
|
30
|
|
||
Net cash provided by financing activities
|
1,467
|
|
|
630
|
|
||
Net cash used by discontinued operations
|
(24
|
)
|
|
(24
|
)
|
||
Net increase (decrease) in cash and equivalents
|
1,398
|
|
|
(261
|
)
|
||
Cash and equivalents at beginning of period
|
902
|
|
|
963
|
|
||
Cash and equivalents at end of period
|
$
|
2,300
|
|
|
$
|
702
|
|
Supplemental cash flow information:
|
|
|
|
||||
Income tax payments, net
|
$
|
(56
|
)
|
|
$
|
(397
|
)
|
Interest payments
|
$
|
(221
|
)
|
|
$
|
(216
|
)
|
|
Three Months Ended
|
||||||||||||||||||||||
|
Common Stock
|
|
Retained
|
|
Treasury
|
|
Accumulated
Other
Comprehensive
|
|
Total
Shareholders’
|
||||||||||||||
(Dollars in millions)
|
Par
|
|
Surplus
|
|
Earnings
|
|
Stock
|
|
Loss
|
|
Equity
|
||||||||||||
March 29, 2020
|
$
|
482
|
|
|
$
|
3,015
|
|
|
$
|
31,983
|
|
|
$
|
(17,809
|
)
|
|
$
|
(4,471
|
)
|
|
$
|
13,200
|
|
Net earnings
|
—
|
|
|
—
|
|
|
625
|
|
|
—
|
|
|
—
|
|
|
625
|
|
||||||
Cash dividends declared
|
—
|
|
|
—
|
|
|
(314
|
)
|
|
—
|
|
|
—
|
|
|
(314
|
)
|
||||||
Equity-based awards
|
—
|
|
|
35
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
35
|
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
344
|
|
|
344
|
|
||||||
June 28, 2020
|
$
|
482
|
|
|
$
|
3,050
|
|
|
$
|
32,294
|
|
|
$
|
(17,809
|
)
|
|
$
|
(4,127
|
)
|
|
$
|
13,890
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
March 31, 2019
|
$
|
482
|
|
|
$
|
2,937
|
|
|
$
|
29,781
|
|
|
$
|
(17,283
|
)
|
|
$
|
(3,683
|
)
|
|
$
|
12,234
|
|
Net earnings
|
—
|
|
|
—
|
|
|
806
|
|
|
—
|
|
|
—
|
|
|
806
|
|
||||||
Cash dividends declared
|
—
|
|
|
—
|
|
|
(296
|
)
|
|
—
|
|
|
—
|
|
|
(296
|
)
|
||||||
Equity-based awards
|
—
|
|
|
22
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
24
|
|
||||||
Shares purchased
|
—
|
|
|
—
|
|
|
—
|
|
|
(98
|
)
|
|
—
|
|
|
(98
|
)
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
207
|
|
|
207
|
|
||||||
June 30, 2019
|
$
|
482
|
|
|
$
|
2,959
|
|
|
$
|
30,291
|
|
|
$
|
(17,379
|
)
|
|
$
|
(3,476
|
)
|
|
$
|
12,877
|
|
|
Six Months Ended
|
||||||||||||||||||||||
|
Common Stock
|
|
Retained
|
|
Treasury
|
|
Accumulated
Other
Comprehensive
|
|
Total
Shareholders’
|
||||||||||||||
(Dollars in millions)
|
Par
|
|
Surplus
|
|
Earnings
|
|
Stock
|
|
Loss
|
|
Equity
|
||||||||||||
December 31, 2019
|
$
|
482
|
|
|
$
|
3,039
|
|
|
$
|
31,633
|
|
|
$
|
(17,358
|
)
|
|
$
|
(4,219
|
)
|
|
$
|
13,577
|
|
Cumulative-effect adjustment*
|
—
|
|
|
—
|
|
|
(37
|
)
|
|
—
|
|
|
—
|
|
|
(37
|
)
|
||||||
Net earnings
|
—
|
|
|
—
|
|
|
1,331
|
|
|
—
|
|
|
—
|
|
|
1,331
|
|
||||||
Cash dividends declared
|
—
|
|
|
—
|
|
|
(633
|
)
|
|
—
|
|
|
—
|
|
|
(633
|
)
|
||||||
Equity-based awards
|
—
|
|
|
11
|
|
|
—
|
|
|
50
|
|
|
—
|
|
|
61
|
|
||||||
Shares purchased
|
—
|
|
|
—
|
|
|
—
|
|
|
(501
|
)
|
|
—
|
|
|
(501
|
)
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
92
|
|
|
92
|
|
||||||
June 28, 2020
|
$
|
482
|
|
|
$
|
3,050
|
|
|
$
|
32,294
|
|
|
$
|
(17,809
|
)
|
|
$
|
(4,127
|
)
|
|
$
|
13,890
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
December 31, 2018
|
$
|
482
|
|
|
$
|
2,946
|
|
|
$
|
29,326
|
|
|
$
|
(17,244
|
)
|
|
$
|
(3,778
|
)
|
|
$
|
11,732
|
|
Net earnings
|
—
|
|
|
—
|
|
|
1,551
|
|
|
—
|
|
|
—
|
|
|
1,551
|
|
||||||
Cash dividends declared
|
—
|
|
|
—
|
|
|
(586
|
)
|
|
—
|
|
|
—
|
|
|
(586
|
)
|
||||||
Equity-based awards
|
—
|
|
|
13
|
|
|
—
|
|
|
49
|
|
|
—
|
|
|
62
|
|
||||||
Shares purchased
|
—
|
|
|
—
|
|
|
—
|
|
|
(184
|
)
|
|
—
|
|
|
(184
|
)
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
302
|
|
|
302
|
|
||||||
June 30, 2019
|
$
|
482
|
|
|
$
|
2,959
|
|
|
$
|
30,291
|
|
|
$
|
(17,379
|
)
|
|
$
|
(3,476
|
)
|
|
$
|
12,877
|
|
|
June 28, 2020
|
|
December 31, 2019
|
||||
PP&E
|
$
|
10,093
|
|
|
$
|
9,761
|
|
Accumulated depreciation
|
(5,372
|
)
|
|
(5,286
|
)
|
||
PP&E, net
|
$
|
4,721
|
|
|
$
|
4,475
|
|
|
Aerospace
|
|
Combat Systems
|
|
Information Technology
|
|
Mission Systems
|
|
Marine Systems
|
|
Total
Goodwill
|
||||||||||||
December 31, 2019 (a)
|
$
|
2,831
|
|
|
$
|
2,681
|
|
|
$
|
9,700
|
|
|
$
|
4,168
|
|
|
$
|
297
|
|
|
$
|
19,677
|
|
Acquisitions (b)
|
21
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
21
|
|
||||||
Other (c)
|
47
|
|
|
(31
|
)
|
|
—
|
|
|
4
|
|
|
—
|
|
|
20
|
|
||||||
June 28, 2020 (a)
|
$
|
2,899
|
|
|
$
|
2,650
|
|
|
$
|
9,700
|
|
|
$
|
4,172
|
|
|
$
|
297
|
|
|
$
|
19,718
|
|
|
Gross Carrying Amount (a)
|
Accumulated Amortization
|
Net Carrying Amount
|
|
Gross Carrying Amount (a)
|
Accumulated Amortization
|
Net Carrying Amount
|
||||||||||||
|
June 28, 2020
|
|
December 31, 2019
|
||||||||||||||||
Contract and program
intangible assets (b)
|
$
|
3,715
|
|
$
|
(1,827
|
)
|
$
|
1,888
|
|
|
$
|
3,776
|
|
$
|
(1,779
|
)
|
$
|
1,997
|
|
Trade names and trademarks
|
486
|
|
(208
|
)
|
278
|
|
|
474
|
|
(195
|
)
|
279
|
|
||||||
Technology and software
|
129
|
|
(99
|
)
|
30
|
|
|
164
|
|
(126
|
)
|
38
|
|
||||||
Other intangible assets
|
159
|
|
(158
|
)
|
1
|
|
|
159
|
|
(158
|
)
|
1
|
|
||||||
Total intangible assets
|
$
|
4,489
|
|
$
|
(2,292
|
)
|
$
|
2,197
|
|
|
$
|
4,573
|
|
$
|
(2,258
|
)
|
$
|
2,315
|
|
(a)
|
Changes in gross carrying amounts consist primarily of adjustments for acquired and divested intangible assets and foreign currency translation.
|
(b)
|
Consists of acquired backlog and probable follow-on work and associated customer relationships.
|
|
Three Months Ended
|
Six Months Ended
|
||||||||||||
|
June 28, 2020
|
|
June 30, 2019
|
June 28, 2020
|
|
June 30, 2019
|
||||||||
Revenue
|
$
|
54
|
|
|
$
|
72
|
|
$
|
144
|
|
|
$
|
168
|
|
Operating earnings
|
(5
|
)
|
|
71
|
|
85
|
|
|
139
|
|
||||
Diluted earnings per share
|
$
|
(0.01
|
)
|
|
$
|
0.19
|
|
$
|
0.23
|
|
|
$
|
0.38
|
|
|
Three Months Ended
|
Six Months Ended
|
||||||||||||
|
June 28, 2020
|
|
June 30, 2019
|
June 28, 2020
|
|
June 30, 2019
|
||||||||
Aircraft manufacturing and completions
|
$
|
1,563
|
|
|
$
|
1,599
|
|
$
|
2,757
|
|
|
$
|
3,332
|
|
Aircraft services
|
411
|
|
|
537
|
|
908
|
|
|
1,044
|
|
||||
Total Aerospace
|
1,974
|
|
|
2,136
|
|
3,665
|
|
|
4,376
|
|
||||
Military vehicles
|
1,103
|
|
|
1,090
|
|
2,249
|
|
|
2,224
|
|
||||
Weapons systems, armament and
munitions
|
515
|
|
|
461
|
|
948
|
|
|
862
|
|
||||
Engineering and other services
|
136
|
|
|
108
|
|
265
|
|
|
209
|
|
||||
Total Combat Systems
|
1,754
|
|
|
1,659
|
|
3,462
|
|
|
3,295
|
|
||||
IT services
|
1,884
|
|
|
2,158
|
|
3,872
|
|
|
4,327
|
|
||||
Total Information Technology
|
1,884
|
|
|
2,158
|
|
3,872
|
|
|
4,327
|
|
||||
C4ISR solutions
|
1,181
|
|
|
1,277
|
|
2,297
|
|
|
2,435
|
|
||||
Total Mission Systems
|
1,181
|
|
|
1,277
|
|
2,297
|
|
|
2,435
|
|
||||
Nuclear-powered submarines
|
1,708
|
|
|
1,538
|
|
3,268
|
|
|
2,915
|
|
||||
Surface ships
|
510
|
|
|
528
|
|
972
|
|
|
974
|
|
||||
Repair and other services
|
253
|
|
|
259
|
|
477
|
|
|
494
|
|
||||
Total Marine Systems
|
2,471
|
|
|
2,325
|
|
4,717
|
|
|
4,383
|
|
||||
Total revenue
|
$
|
9,264
|
|
|
$
|
9,555
|
|
$
|
18,013
|
|
|
$
|
18,816
|
|
Three Months Ended June 28, 2020
|
Aerospace
|
|
Combat Systems
|
|
Information Technology
|
|
Mission Systems
|
|
Marine Systems
|
|
Total
Revenue
|
||||||||||||
Fixed-price
|
$
|
1,849
|
|
|
$
|
1,507
|
|
|
$
|
742
|
|
|
$
|
662
|
|
|
$
|
1,716
|
|
|
$
|
6,476
|
|
Cost-reimbursement
|
—
|
|
|
230
|
|
|
800
|
|
|
471
|
|
|
750
|
|
|
2,251
|
|
||||||
Time-and-materials
|
125
|
|
|
17
|
|
|
342
|
|
|
48
|
|
|
5
|
|
|
537
|
|
||||||
Total revenue
|
$
|
1,974
|
|
|
$
|
1,754
|
|
|
$
|
1,884
|
|
|
$
|
1,181
|
|
|
$
|
2,471
|
|
|
$
|
9,264
|
|
Three Months Ended June 30, 2019
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fixed-price
|
$
|
1,925
|
|
|
$
|
1,427
|
|
|
$
|
875
|
|
|
$
|
752
|
|
|
$
|
1,575
|
|
|
$
|
6,554
|
|
Cost-reimbursement
|
—
|
|
|
221
|
|
|
858
|
|
|
484
|
|
|
745
|
|
|
2,308
|
|
||||||
Time-and-materials
|
211
|
|
|
11
|
|
|
425
|
|
|
41
|
|
|
5
|
|
|
693
|
|
||||||
Total revenue
|
$
|
2,136
|
|
|
$
|
1,659
|
|
|
$
|
2,158
|
|
|
$
|
1,277
|
|
|
$
|
2,325
|
|
|
$
|
9,555
|
|
Six Months Ended June 28, 2020
|
Aerospace
|
|
Combat Systems
|
|
Information Technology
|
|
Mission Systems
|
|
Marine Systems
|
|
Total
Revenue
|
||||||||||||
Fixed-price
|
$
|
3,327
|
|
|
$
|
2,972
|
|
|
$
|
1,511
|
|
|
$
|
1,282
|
|
|
$
|
3,285
|
|
|
$
|
12,377
|
|
Cost-reimbursement
|
—
|
|
|
459
|
|
|
1,693
|
|
|
925
|
|
|
1,425
|
|
|
4,502
|
|
||||||
Time-and-materials
|
338
|
|
|
31
|
|
|
668
|
|
|
90
|
|
|
7
|
|
|
1,134
|
|
||||||
Total revenue
|
$
|
3,665
|
|
|
$
|
3,462
|
|
|
$
|
3,872
|
|
|
$
|
2,297
|
|
|
$
|
4,717
|
|
|
$
|
18,013
|
|
Six Months Ended June 30, 2019
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fixed-price
|
$
|
3,965
|
|
|
$
|
2,843
|
|
|
$
|
1,796
|
|
|
$
|
1,403
|
|
|
$
|
2,991
|
|
|
$
|
12,998
|
|
Cost-reimbursement
|
—
|
|
|
432
|
|
|
1,699
|
|
|
947
|
|
|
1,385
|
|
|
4,463
|
|
||||||
Time-and-materials
|
411
|
|
|
20
|
|
|
832
|
|
|
85
|
|
|
7
|
|
|
1,355
|
|
||||||
Total revenue
|
$
|
4,376
|
|
|
$
|
3,295
|
|
|
$
|
4,327
|
|
|
$
|
2,435
|
|
|
$
|
4,383
|
|
|
$
|
18,816
|
|
Three Months Ended June 28, 2020
|
Aerospace
|
|
Combat Systems
|
|
Information Technology
|
|
Mission Systems
|
|
Marine Systems
|
|
Total
Revenue
|
||||||||||||
U.S. government:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
DoD
|
$
|
52
|
|
|
$
|
930
|
|
|
$
|
825
|
|
|
$
|
870
|
|
|
$
|
2,390
|
|
|
$
|
5,067
|
|
Non-DoD
|
—
|
|
|
3
|
|
|
1,030
|
|
|
117
|
|
|
1
|
|
|
1,151
|
|
||||||
Foreign Military Sales (FMS)
|
52
|
|
|
99
|
|
|
4
|
|
|
9
|
|
|
51
|
|
|
215
|
|
||||||
Total U.S. government
|
104
|
|
|
1,032
|
|
|
1,859
|
|
|
996
|
|
|
2,442
|
|
|
6,433
|
|
||||||
U.S. commercial
|
1,032
|
|
|
86
|
|
|
39
|
|
|
27
|
|
|
27
|
|
|
1,211
|
|
||||||
Non-U.S. government
|
53
|
|
|
618
|
|
|
(14
|
)
|
|
126
|
|
|
2
|
|
|
785
|
|
||||||
Non-U.S. commercial
|
785
|
|
|
18
|
|
|
—
|
|
|
32
|
|
|
—
|
|
|
835
|
|
||||||
Total revenue
|
$
|
1,974
|
|
|
$
|
1,754
|
|
|
$
|
1,884
|
|
|
$
|
1,181
|
|
|
$
|
2,471
|
|
|
$
|
9,264
|
|
Three Months Ended June 30, 2019
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. government:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
DoD
|
$
|
52
|
|
|
$
|
910
|
|
|
$
|
926
|
|
|
$
|
884
|
|
|
$
|
2,243
|
|
|
$
|
5,015
|
|
Non-DoD
|
—
|
|
|
3
|
|
|
1,178
|
|
|
133
|
|
|
1
|
|
|
1,315
|
|
||||||
FMS
|
14
|
|
|
90
|
|
|
4
|
|
|
12
|
|
|
47
|
|
|
167
|
|
||||||
Total U.S. government
|
66
|
|
|
1,003
|
|
|
2,108
|
|
|
1,029
|
|
|
2,291
|
|
|
6,497
|
|
||||||
U.S. commercial
|
1,185
|
|
|
59
|
|
|
45
|
|
|
39
|
|
|
30
|
|
|
1,358
|
|
||||||
Non-U.S. government
|
144
|
|
|
587
|
|
|
5
|
|
|
181
|
|
|
2
|
|
|
919
|
|
||||||
Non-U.S. commercial
|
741
|
|
|
10
|
|
|
—
|
|
|
28
|
|
|
2
|
|
|
781
|
|
||||||
Total revenue
|
$
|
2,136
|
|
|
$
|
1,659
|
|
|
$
|
2,158
|
|
|
$
|
1,277
|
|
|
$
|
2,325
|
|
|
$
|
9,555
|
|
Six Months Ended June 28, 2020
|
Aerospace
|
|
Combat Systems
|
|
Information Technology
|
|
Mission Systems
|
|
Marine Systems
|
|
Total
Revenue
|
||||||||||||
U.S. government:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
DoD
|
$
|
213
|
|
|
$
|
1,818
|
|
|
$
|
1,674
|
|
|
$
|
1,658
|
|
|
$
|
4,549
|
|
|
$
|
9,912
|
|
Non-DoD
|
—
|
|
|
6
|
|
|
2,108
|
|
|
223
|
|
|
2
|
|
|
2,339
|
|
||||||
FMS
|
70
|
|
|
188
|
|
|
8
|
|
|
18
|
|
|
100
|
|
|
384
|
|
||||||
Total U.S. government
|
283
|
|
|
2,012
|
|
|
3,790
|
|
|
1,899
|
|
|
4,651
|
|
|
12,635
|
|
||||||
U.S. commercial
|
1,812
|
|
|
141
|
|
|
87
|
|
|
60
|
|
|
60
|
|
|
2,160
|
|
||||||
Non-U.S. government
|
74
|
|
|
1,281
|
|
|
(5
|
)
|
|
269
|
|
|
5
|
|
|
1,624
|
|
||||||
Non-U.S. commercial
|
1,496
|
|
|
28
|
|
|
—
|
|
|
69
|
|
|
1
|
|
|
1,594
|
|
||||||
Total revenue
|
$
|
3,665
|
|
|
$
|
3,462
|
|
|
$
|
3,872
|
|
|
$
|
2,297
|
|
|
$
|
4,717
|
|
|
$
|
18,013
|
|
Six Months Ended June 30, 2019
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. government:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
DoD
|
$
|
175
|
|
|
$
|
1,703
|
|
|
$
|
1,850
|
|
|
$
|
1,668
|
|
|
$
|
4,218
|
|
|
$
|
9,614
|
|
Non-DoD
|
—
|
|
|
6
|
|
|
2,370
|
|
|
268
|
|
|
1
|
|
|
2,645
|
|
||||||
FMS
|
29
|
|
|
169
|
|
|
9
|
|
|
21
|
|
|
91
|
|
|
319
|
|
||||||
Total U.S. government
|
204
|
|
|
1,878
|
|
|
4,229
|
|
|
1,957
|
|
|
4,310
|
|
|
12,578
|
|
||||||
U.S. commercial
|
2,455
|
|
|
109
|
|
|
85
|
|
|
74
|
|
|
66
|
|
|
2,789
|
|
||||||
Non-U.S. government
|
207
|
|
|
1,288
|
|
|
13
|
|
|
347
|
|
|
4
|
|
|
1,859
|
|
||||||
Non-U.S. commercial
|
1,510
|
|
|
20
|
|
|
—
|
|
|
57
|
|
|
3
|
|
|
1,590
|
|
||||||
Total revenue
|
$
|
4,376
|
|
|
$
|
3,295
|
|
|
$
|
4,327
|
|
|
$
|
2,435
|
|
|
$
|
4,383
|
|
|
$
|
18,816
|
|
|
Three Months Ended
|
Six Months Ended
|
||||||||
|
June 28, 2020
|
|
June 30, 2019
|
June 28, 2020
|
|
June 30, 2019
|
||||
Basic weighted average shares
outstanding
|
286,388
|
|
|
288,099
|
|
287,479
|
|
|
288,008
|
|
Dilutive effect of stock options and
restricted stock/RSUs*
|
545
|
|
|
2,716
|
|
1,036
|
|
|
2,816
|
|
Diluted weighted average shares
outstanding
|
286,933
|
|
|
290,815
|
|
288,515
|
|
|
290,824
|
|
•
|
Level 1 - quoted prices in active markets for identical assets or liabilities;
|
•
|
Level 2 - inputs, other than quoted prices, observable by a marketplace participant either directly or indirectly; and
|
•
|
Level 3 - unobservable inputs significant to the fair value measurement.
|
|
Carrying
Value
|
|
Fair
Value
|
|
Quoted Prices in Active Markets for Identical Assets
(Level 1)
|
|
Significant Other Observable Inputs
(Level 2)
|
|
Significant Unobservable Inputs
(Level 3)
|
||||||||||
Financial Assets (Liabilities)
|
June 28, 2020
|
||||||||||||||||||
Measured at fair value:
|
|
|
|
|
|
|
|
|
|
||||||||||
Marketable securities held in trust:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and equivalents
|
$
|
7
|
|
|
$
|
7
|
|
|
$
|
—
|
|
|
$
|
7
|
|
|
$
|
—
|
|
Available-for-sale debt securities
|
141
|
|
|
141
|
|
|
—
|
|
|
141
|
|
|
—
|
|
|||||
Equity securities
|
51
|
|
|
51
|
|
|
51
|
|
|
—
|
|
|
—
|
|
|||||
Other investments
|
9
|
|
|
9
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|||||
Cash flow hedges
|
77
|
|
|
77
|
|
|
—
|
|
|
77
|
|
|
—
|
|
|||||
Measured at amortized cost:
|
|
|
|
|
|
|
|
|
|
||||||||||
Short- and long-term debt principal
|
(14,724
|
)
|
|
(16,104
|
)
|
|
—
|
|
|
(16,104
|
)
|
|
—
|
|
|
December 31, 2019
|
||||||||||||||||||
Measured at fair value:
|
|
|
|
|
|
|
|
|
|
||||||||||
Marketable securities held in trust:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and equivalents
|
$
|
24
|
|
|
$
|
24
|
|
|
$
|
11
|
|
|
$
|
13
|
|
|
$
|
—
|
|
Available-for-sale debt securities
|
129
|
|
|
129
|
|
|
—
|
|
|
129
|
|
|
—
|
|
|||||
Equity securities
|
54
|
|
|
54
|
|
|
54
|
|
|
—
|
|
|
—
|
|
|||||
Other investments
|
4
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|||||
Cash flow hedges
|
26
|
|
|
26
|
|
|
—
|
|
|
26
|
|
|
—
|
|
|||||
Measured at amortized cost:
|
|
|
|
|
|
|
|
|
|
||||||||||
Short- and long-term debt principal
|
(12,005
|
)
|
|
(12,339
|
)
|
|
—
|
|
|
(12,339
|
)
|
|
—
|
|
|
June 28, 2020
|
|
December 31, 2019
|
||||
Deferred tax asset
|
$
|
35
|
|
|
$
|
33
|
|
Deferred tax liability
|
(446
|
)
|
|
(481
|
)
|
||
Net deferred tax liability
|
$
|
(411
|
)
|
|
$
|
(448
|
)
|
|
June 28, 2020
|
|
December 31, 2019
|
||||
Unbilled revenue
|
$
|
33,823
|
|
|
$
|
33,481
|
|
Advances and progress billings
|
(26,108
|
)
|
|
(25,624
|
)
|
||
Net unbilled receivables
|
$
|
7,715
|
|
|
$
|
7,857
|
|
|
June 28, 2020
|
|
December 31, 2019
|
||||
Work in process
|
$
|
4,599
|
|
|
$
|
4,419
|
|
Raw materials
|
1,830
|
|
|
1,733
|
|
||
Finished goods
|
154
|
|
|
30
|
|
||
Pre-owned aircraft
|
83
|
|
|
124
|
|
||
Total inventories
|
$
|
6,666
|
|
|
$
|
6,306
|
|
|
|
June 28, 2020
|
|
December 31, 2019
|
||||
Fixed-rate notes due:
|
Interest rate:
|
|
|
|
||||
May 2020
|
2.875%
|
$
|
—
|
|
|
$
|
2,000
|
|
May 2021
|
3.000%
|
2,000
|
|
|
2,000
|
|
||
July 2021
|
3.875%
|
500
|
|
|
500
|
|
||
November 2022
|
2.250%
|
1,000
|
|
|
1,000
|
|
||
May 2023
|
3.375%
|
750
|
|
|
750
|
|
||
August 2023
|
1.875%
|
500
|
|
|
500
|
|
||
November 2024
|
2.375%
|
500
|
|
|
500
|
|
||
April 2025
|
3.250%
|
750
|
|
|
—
|
|
||
May 2025
|
3.500%
|
750
|
|
|
750
|
|
||
August 2026
|
2.125%
|
500
|
|
|
500
|
|
||
April 2027
|
3.500%
|
750
|
|
|
—
|
|
||
November 2027
|
2.625%
|
500
|
|
|
500
|
|
||
May 2028
|
3.750%
|
1,000
|
|
|
1,000
|
|
||
April 2030
|
3.625%
|
1,000
|
|
|
—
|
|
||
April 2040
|
4.250%
|
750
|
|
|
—
|
|
||
November 2042
|
3.600%
|
500
|
|
|
500
|
|
||
April 2050
|
4.250%
|
750
|
|
|
—
|
|
||
Floating-rate notes due:
|
|
|
|
|
||||
May 2020
|
3-month LIBOR + 0.29%
|
—
|
|
|
500
|
|
||
May 2021
|
3-month LIBOR + 0.38%
|
500
|
|
|
500
|
|
||
Commercial paper
|
2.104%
|
1,243
|
|
|
—
|
|
||
Other
|
Various
|
481
|
|
|
505
|
|
||
Total debt principal
|
|
14,724
|
|
|
12,005
|
|
||
Less unamortized debt issuance
costs and discounts
|
|
133
|
|
|
75
|
|
||
Total debt
|
|
14,591
|
|
|
11,930
|
|
||
Less current portion
|
|
4,121
|
|
|
2,920
|
|
||
Long-term debt
|
|
$
|
10,470
|
|
|
$
|
9,010
|
|
|
June 28, 2020
|
|
December 31, 2019
|
||||
|
|
|
|
||||
Salaries and wages
|
$
|
929
|
|
|
$
|
941
|
|
Workers’ compensation
|
329
|
|
|
306
|
|
||
Retirement benefits
|
291
|
|
|
296
|
|
||
Operating lease liabilities
|
267
|
|
|
252
|
|
||
Fair value of cash flow hedges
|
125
|
|
|
32
|
|
||
Other (a)
|
1,949
|
|
|
1,744
|
|
||
Total other current liabilities
|
$
|
3,890
|
|
|
$
|
3,571
|
|
|
|
|
|
||||
Retirement benefits
|
$
|
4,944
|
|
|
$
|
5,172
|
|
Operating lease liabilities
|
1,112
|
|
|
1,251
|
|
||
Customer deposits on commercial contracts
|
782
|
|
|
709
|
|
||
Deferred income taxes
|
446
|
|
|
481
|
|
||
Other (b)
|
1,972
|
|
|
1,840
|
|
||
Total other liabilities
|
$
|
9,256
|
|
|
$
|
9,453
|
|
|
Gains /(Losses) on Cash Flow Hedges
|
Foreign Currency Translation Adjustments
|
Changes in Retirement Plans’ Funded Status
|
AOCL
|
||||||||
December 31, 2019
|
$
|
2
|
|
$
|
288
|
|
$
|
(4,509
|
)
|
$
|
(4,219
|
)
|
Other comprehensive income, pretax
|
71
|
|
(79
|
)
|
152
|
|
144
|
|
||||
Provision for income tax, net
|
(20
|
)
|
—
|
|
(32
|
)
|
(52
|
)
|
||||
Other comprehensive income, net of tax
|
51
|
|
(79
|
)
|
120
|
|
92
|
|
||||
June 28, 2020
|
$
|
53
|
|
$
|
209
|
|
$
|
(4,389
|
)
|
$
|
(4,127
|
)
|
December 31, 2018
|
$
|
(71
|
)
|
$
|
102
|
|
$
|
(3,809
|
)
|
$
|
(3,778
|
)
|
Other comprehensive income, pretax
|
68
|
|
156
|
|
122
|
|
346
|
|
||||
Provision for income tax, net
|
(16
|
)
|
—
|
|
(28
|
)
|
(44
|
)
|
||||
Other comprehensive income, net of tax
|
52
|
|
156
|
|
94
|
|
302
|
|
||||
June 30, 2019
|
$
|
(19
|
)
|
$
|
258
|
|
$
|
(3,715
|
)
|
$
|
(3,476
|
)
|
Six Months Ended
|
June 28, 2020
|
|
June 30, 2019
|
||||
Beginning balance
|
$
|
619
|
|
|
$
|
480
|
|
Warranty expense
|
55
|
|
|
50
|
|
||
Payments
|
(51
|
)
|
|
(37
|
)
|
||
Adjustments
|
(2
|
)
|
|
(11
|
)
|
||
Ending balance
|
$
|
621
|
|
|
$
|
482
|
|
|
Pension Benefits
|
Other Post-retirement Benefits
|
||||||||||||
Three Months Ended
|
June 28, 2020
|
|
June 30, 2019
|
June 28, 2020
|
|
June 30, 2019
|
||||||||
Service cost
|
$
|
30
|
|
|
$
|
28
|
|
$
|
3
|
|
|
$
|
2
|
|
Interest cost
|
123
|
|
|
150
|
|
7
|
|
|
9
|
|
||||
Expected return on plan assets
|
(235
|
)
|
|
(228
|
)
|
(9
|
)
|
|
(9
|
)
|
||||
Recognized net actuarial loss (gain)
|
80
|
|
|
70
|
|
(1
|
)
|
|
(2
|
)
|
||||
Amortization of prior service credit
|
(5
|
)
|
|
(5
|
)
|
—
|
|
|
(1
|
)
|
||||
Net periodic benefit (credit) cost
|
$
|
(7
|
)
|
|
$
|
15
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
Six Months Ended
|
June 28, 2020
|
|
|
|
|
|
||||||||
Service cost
|
$
|
59
|
|
|
$
|
56
|
|
$
|
5
|
|
|
$
|
4
|
|
Interest cost
|
246
|
|
|
300
|
|
14
|
|
|
18
|
|
||||
Expected return on plan assets
|
(469
|
)
|
|
(456
|
)
|
(18
|
)
|
|
(18
|
)
|
||||
Recognized net actuarial loss (gain)
|
159
|
|
|
140
|
|
(2
|
)
|
|
(4
|
)
|
||||
Amortization of prior service credit
|
(9
|
)
|
|
(9
|
)
|
—
|
|
|
(2
|
)
|
||||
Net periodic benefit (credit) cost
|
$
|
(14
|
)
|
|
$
|
31
|
|
$
|
(1
|
)
|
|
$
|
(2
|
)
|
|
Revenue
|
Operating Earnings
|
||||||||||
Three Months Ended
|
June 28, 2020
|
June 30, 2019
|
June 28, 2020
|
June 30, 2019
|
||||||||
Aerospace
|
$
|
1,974
|
|
$
|
2,136
|
|
$
|
159
|
|
$
|
331
|
|
Combat Systems
|
1,754
|
|
1,659
|
|
239
|
|
242
|
|
||||
Information Technology
|
1,884
|
|
2,158
|
|
83
|
|
154
|
|
||||
Mission Systems
|
1,181
|
|
1,277
|
|
164
|
|
162
|
|
||||
Marine Systems
|
2,471
|
|
2,325
|
|
200
|
|
197
|
|
||||
Corporate
|
—
|
|
—
|
|
(4
|
)
|
4
|
|
||||
Total
|
$
|
9,264
|
|
$
|
9,555
|
|
$
|
841
|
|
$
|
1,090
|
|
Six Months Ended
|
|
|
|
|
||||||||
Aerospace
|
$
|
3,665
|
|
$
|
4,376
|
|
$
|
399
|
|
$
|
659
|
|
Combat Systems
|
3,462
|
|
3,295
|
|
462
|
|
448
|
|
||||
Information Technology
|
3,872
|
|
4,327
|
|
233
|
|
310
|
|
||||
Mission Systems
|
2,297
|
|
2,435
|
|
312
|
|
310
|
|
||||
Marine Systems
|
4,717
|
|
4,383
|
|
384
|
|
377
|
|
||||
Corporate
|
—
|
|
—
|
|
(8
|
)
|
—
|
|
||||
Total
|
$
|
18,013
|
|
$
|
18,816
|
|
$
|
1,782
|
|
$
|
2,104
|
|
•
|
implementing measures to protect the health and safety of our employees;
|
•
|
modifying employee work locations and schedules where possible and permitted under our contracts;
|
•
|
coordinating closely with our suppliers and customers;
|
•
|
instituting various aspects of our business continuity programs;
|
•
|
planning for and working aggressively to mitigate disruptions that may occur; and
|
•
|
supporting our communities and the U.S. government in addressing the challenges of the pandemic, such as the production of medical supplies and donation of personal protective equipment.
|
Three Months Ended
|
June 28, 2020
|
|
June 30, 2019
|
|
Variance
|
|||||||||
Revenue
|
$
|
9,264
|
|
|
$
|
9,555
|
|
|
$
|
(291
|
)
|
|
(3.0
|
)%
|
Operating costs and expenses
|
(8,423
|
)
|
|
(8,465
|
)
|
|
42
|
|
|
(0.5
|
)%
|
|||
Operating earnings
|
841
|
|
|
1,090
|
|
|
(249
|
)
|
|
(22.8
|
)%
|
|||
Operating margin
|
9.1
|
%
|
|
11.4
|
%
|
|
|
|
|
|||||
Six Months Ended
|
June 28, 2020
|
|
June 30, 2019
|
|
Variance
|
|||||||||
Revenue
|
$
|
18,013
|
|
|
$
|
18,816
|
|
|
$
|
(803
|
)
|
|
(4.3
|
)%
|
Operating costs and expenses
|
(16,231
|
)
|
|
(16,712
|
)
|
|
481
|
|
|
(2.9
|
)%
|
|||
Operating earnings
|
1,782
|
|
|
2,104
|
|
|
(322
|
)
|
|
(15.3
|
)%
|
|||
Operating margin
|
9.9
|
%
|
|
11.2
|
%
|
|
|
|
|
Three Months Ended
|
June 28, 2020
|
|
June 30, 2019
|
|
Variance
|
|||||||||
Revenue
|
$
|
1,974
|
|
|
$
|
2,136
|
|
|
$
|
(162
|
)
|
|
(7.6
|
)%
|
Operating earnings
|
159
|
|
|
331
|
|
|
(172
|
)
|
|
(52.0
|
)%
|
|||
Operating margin
|
8.1
|
%
|
|
15.5
|
%
|
|
|
|
|
|||||
Gulfstream aircraft deliveries (in units)
|
32
|
|
|
31
|
|
|
1
|
|
|
3.2
|
%
|
|||
Six Months Ended
|
June 28, 2020
|
|
June 30, 2019
|
|
Variance
|
|||||||||
Revenue
|
$
|
3,665
|
|
|
$
|
4,376
|
|
|
$
|
(711
|
)
|
|
(16.2
|
)%
|
Operating earnings
|
399
|
|
|
659
|
|
|
(260
|
)
|
|
(39.5
|
)%
|
|||
Operating margin
|
10.9
|
%
|
|
15.1
|
%
|
|
|
|
|
|||||
Gulfstream aircraft deliveries (in units)
|
55
|
|
|
65
|
|
|
(10
|
)
|
|
(15.4
|
)%
|
|
Second Quarter
|
|
Six Months
|
||||
Aircraft manufacturing
|
$
|
(36
|
)
|
|
$
|
(588
|
)
|
Aircraft services and completions
|
(126
|
)
|
|
(123
|
)
|
||
Total decrease
|
$
|
(162
|
)
|
|
$
|
(711
|
)
|
|
Second Quarter
|
|
Six Months
|
||||
Aircraft manufacturing
|
$
|
(142
|
)
|
|
$
|
(281
|
)
|
Aircraft services and completions
|
(29
|
)
|
|
(30
|
)
|
||
Restructuring charge
|
(42
|
)
|
|
(42
|
)
|
||
G&A/other expenses
|
41
|
|
|
93
|
|
||
Total decrease
|
$
|
(172
|
)
|
|
$
|
(260
|
)
|
Three Months Ended
|
June 28, 2020
|
|
June 30, 2019
|
|
Variance
|
|||||||||
Revenue
|
$
|
1,754
|
|
|
$
|
1,659
|
|
|
$
|
95
|
|
|
5.7
|
%
|
Operating earnings
|
239
|
|
|
242
|
|
|
(3
|
)
|
|
(1.2
|
)%
|
|||
Operating margin
|
13.6
|
%
|
|
14.6
|
%
|
|
|
|
|
|||||
Six Months Ended
|
June 28, 2020
|
|
June 30, 2019
|
|
Variance
|
|||||||||
Revenue
|
$
|
3,462
|
|
|
$
|
3,295
|
|
|
$
|
167
|
|
|
5.1
|
%
|
Operating earnings
|
462
|
|
|
448
|
|
|
14
|
|
|
3.1
|
%
|
|||
Operating margin
|
13.3
|
%
|
|
13.6
|
%
|
|
|
|
|
|
Second Quarter
|
|
Six Months
|
||||
Weapons systems and munitions
|
$
|
62
|
|
|
$
|
111
|
|
U.S. military vehicles
|
(6
|
)
|
|
59
|
|
||
International military vehicles
|
39
|
|
|
(3
|
)
|
||
Total increase
|
$
|
95
|
|
|
$
|
167
|
|
Three Months Ended
|
June 28, 2020
|
|
June 30, 2019
|
|
Variance
|
|||||||||
Revenue
|
$
|
1,884
|
|
|
$
|
2,158
|
|
|
$
|
(274
|
)
|
|
(12.7
|
)%
|
Operating earnings
|
83
|
|
|
154
|
|
|
(71
|
)
|
|
(46.1
|
)%
|
|||
Operating margin
|
4.4
|
%
|
|
7.1
|
%
|
|
|
|
|
|||||
Six Months Ended
|
June 28, 2020
|
|
June 30, 2019
|
|
Variance
|
|||||||||
Revenue
|
$
|
3,872
|
|
|
$
|
4,327
|
|
|
$
|
(455
|
)
|
|
(10.5
|
)%
|
Operating earnings
|
233
|
|
|
310
|
|
|
(77
|
)
|
|
(24.8
|
)%
|
|||
Operating margin
|
6.0
|
%
|
|
7.2
|
%
|
|
|
|
|
|
Second Quarter
|
|
Six Months
|
||||
Intelligence and homeland security
|
$
|
(97
|
)
|
|
$
|
(232
|
)
|
Defense
|
(108
|
)
|
|
(140
|
)
|
||
Federal civilian
|
(69
|
)
|
|
(83
|
)
|
||
Total decrease
|
$
|
(274
|
)
|
|
$
|
(455
|
)
|
Three Months Ended
|
June 28, 2020
|
|
June 30, 2019
|
|
Variance
|
|||||||||
Revenue
|
$
|
1,181
|
|
|
$
|
1,277
|
|
|
$
|
(96
|
)
|
|
(7.5
|
)%
|
Operating earnings
|
164
|
|
|
162
|
|
|
2
|
|
|
1.2
|
%
|
|||
Operating margin
|
13.9
|
%
|
|
12.7
|
%
|
|
|
|
|
|||||
Six Months Ended
|
June 28, 2020
|
|
June 30, 2019
|
|
Variance
|
|||||||||
Revenue
|
$
|
2,297
|
|
|
$
|
2,435
|
|
|
$
|
(138
|
)
|
|
(5.7
|
)%
|
Operating earnings
|
312
|
|
|
310
|
|
|
2
|
|
|
0.6
|
%
|
|||
Operating margin
|
13.6
|
%
|
|
12.7
|
%
|
|
|
|
|
|
Second Quarter
|
|
Six Months
|
||||
Ground systems and products
|
$
|
(90
|
)
|
|
$
|
(108
|
)
|
Space, intelligence and cyber systems
|
9
|
|
|
(24
|
)
|
||
Naval, air and electronic systems
|
(15
|
)
|
|
(6
|
)
|
||
Total decrease
|
$
|
(96
|
)
|
|
$
|
(138
|
)
|
Three Months Ended
|
June 28, 2020
|
|
June 30, 2019
|
|
Variance
|
|||||||||
Revenue
|
$
|
2,471
|
|
|
$
|
2,325
|
|
|
$
|
146
|
|
|
6.3
|
%
|
Operating earnings
|
200
|
|
|
197
|
|
|
3
|
|
|
1.5
|
%
|
|||
Operating margin
|
8.1
|
%
|
|
8.5
|
%
|
|
|
|
|
|||||
Six Months Ended
|
June 28, 2020
|
|
June 30, 2019
|
|
Variance
|
|||||||||
Revenue
|
$
|
4,717
|
|
|
$
|
4,383
|
|
|
$
|
334
|
|
|
7.6
|
%
|
Operating earnings
|
384
|
|
|
377
|
|
|
7
|
|
|
1.9
|
%
|
|||
Operating margin
|
8.1
|
%
|
|
8.6
|
%
|
|
|
|
|
|
Second Quarter
|
|
Six Months
|
||||
U.S. Navy ship construction
|
$
|
141
|
|
|
$
|
293
|
|
U.S. Navy ship engineering, repair and other services
|
14
|
|
|
52
|
|
||
Commercial ship construction
|
(9
|
)
|
|
(11
|
)
|
||
Total increase
|
$
|
146
|
|
|
$
|
334
|
|
|
Three Months Ended
|
Six Months Ended
|
||||||||||||
|
June 28, 2020
|
|
June 30, 2019
|
June 28, 2020
|
|
June 30, 2019
|
||||||||
Operating (expense) income
|
$
|
(4
|
)
|
|
$
|
4
|
|
$
|
(8
|
)
|
|
$
|
—
|
|
Three Months Ended
|
June 28, 2020
|
|
June 30, 2019
|
|
Variance
|
|||||||||
Revenue
|
$
|
5,505
|
|
|
$
|
5,401
|
|
|
$
|
104
|
|
|
1.9
|
%
|
Operating costs
|
(4,603
|
)
|
|
(4,342
|
)
|
|
(261
|
)
|
|
6.0
|
%
|
|||
Six Months Ended
|
June 28, 2020
|
|
June 30, 2019
|
|
Variance
|
|||||||||
Revenue
|
$
|
10,395
|
|
|
$
|
10,652
|
|
|
$
|
(257
|
)
|
|
(2.4
|
)%
|
Operating costs
|
(8,586
|
)
|
|
(8,577
|
)
|
|
(9
|
)
|
|
0.1
|
%
|
|
Second Quarter
|
|
Six Months
|
||||
Ship construction
|
$
|
134
|
|
|
$
|
282
|
|
Aircraft manufacturing
|
(36
|
)
|
|
(588
|
)
|
||
Other, net
|
6
|
|
|
49
|
|
||
Total increase (decrease)
|
$
|
104
|
|
|
$
|
(257
|
)
|
Three Months Ended
|
June 28, 2020
|
|
June 30, 2019
|
|
Variance
|
|||||||||
Revenue
|
$
|
3,759
|
|
|
$
|
4,154
|
|
|
$
|
(395
|
)
|
|
(9.5
|
)%
|
Operating costs
|
(3,246
|
)
|
|
(3,527
|
)
|
|
281
|
|
|
(8.0
|
)%
|
|||
Six Months Ended
|
June 28, 2020
|
|
June 30, 2019
|
|
Variance
|
|||||||||
Revenue
|
$
|
7,618
|
|
|
$
|
8,164
|
|
|
$
|
(546
|
)
|
|
(6.7
|
)%
|
Operating costs
|
(6,547
|
)
|
|
(6,925
|
)
|
|
378
|
|
|
(5.5
|
)%
|
|
Second Quarter
|
|
Six Months
|
||||
IT services
|
$
|
(274
|
)
|
|
$
|
(455
|
)
|
Aircraft services and completions
|
(126
|
)
|
|
(123
|
)
|
||
Other, net
|
5
|
|
|
32
|
|
||
Total decrease
|
$
|
(395
|
)
|
|
$
|
(546
|
)
|
|
Funded
|
|
Unfunded
|
|
Total Backlog
|
|
Estimated Potential Contract Value
|
|
Total
Estimated Contract Value
|
||||||||||
|
June 28, 2020
|
||||||||||||||||||
Aerospace
|
$
|
11,874
|
|
|
$
|
239
|
|
|
$
|
12,113
|
|
|
$
|
2,834
|
|
|
$
|
14,947
|
|
Combat Systems
|
13,863
|
|
|
242
|
|
|
14,105
|
|
|
6,399
|
|
|
20,504
|
|
|||||
Information Technology
|
5,464
|
|
|
3,463
|
|
|
8,927
|
|
|
18,392
|
|
|
27,319
|
|
|||||
Mission Systems
|
4,856
|
|
|
185
|
|
|
5,041
|
|
|
7,510
|
|
|
12,551
|
|
|||||
Marine Systems
|
25,118
|
|
|
17,365
|
|
|
42,483
|
|
|
14,441
|
|
|
56,924
|
|
|||||
Total
|
$
|
61,175
|
|
|
$
|
21,494
|
|
|
$
|
82,669
|
|
|
$
|
49,576
|
|
|
$
|
132,245
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
March 29, 2020
|
||||||||||||||||||
Aerospace
|
$
|
12,998
|
|
|
$
|
274
|
|
|
$
|
13,272
|
|
|
$
|
2,837
|
|
|
$
|
16,109
|
|
Combat Systems
|
14,373
|
|
|
244
|
|
|
14,617
|
|
|
4,253
|
|
|
18,870
|
|
|||||
Information Technology
|
5,375
|
|
|
4,127
|
|
|
9,502
|
|
|
18,638
|
|
|
28,140
|
|
|||||
Mission Systems
|
4,947
|
|
|
229
|
|
|
5,176
|
|
|
7,957
|
|
|
13,133
|
|
|||||
Marine Systems
|
26,112
|
|
|
17,053
|
|
|
43,165
|
|
|
4,460
|
|
|
47,625
|
|
|||||
Total
|
$
|
63,805
|
|
|
$
|
21,927
|
|
|
$
|
85,732
|
|
|
$
|
38,145
|
|
|
$
|
123,877
|
|
•
|
$320 from the U.S. Army to upgrade Stryker vehicles to the double-V-hull A1 configuration. The contract has a maximum potential value of $2.5 billion.
|
•
|
$215 from the Army for the production of Hydra-70 rockets. The contract has a maximum potential value of $3.4 billion.
|
•
|
$110 from the U.S. Navy to provide missile components for the Aegis Ballistic Missile Defense program.
|
•
|
$100 for various munitions and ordnance.
|
•
|
$50 from the Navy to produce gun systems for the F-35 Joint Strike Fighter.
|
•
|
$120 from the U.S. Air Force for the Battlefield Information Collection and Exploitation System (BICES) program to provide intelligence information sharing capabilities for the Department of Defense (DoD). The contract has a maximum potential value of $620.
|
•
|
$130 from the Centers for Medicare and Medicaid Services (CMS) for several contracts, including support of the agency’s Healthcare Integrated General Ledger Accounting System (HIGLAS) application.
|
•
|
$125 for several key contracts to provide intelligence services to classified customers.
|
•
|
$50 from the Navy to provide training and training-related program support.
|
•
|
$40 to provide IT, cloud support and network management services for a commercial customer.
|
•
|
$175 from the Army for computing and communications equipment under the Common Hardware Systems-5 (CHS-5) program.
|
•
|
$105 from the Navy to support the design and development of fire-control systems for ballistic-missile submarines for the Navy and the U.K. Royal Navy.
|
•
|
$60 to provide sustainment services for the Navy’s next-generation Mobile User Objective System (MUOS) satellite communications system.
|
•
|
$35 from the U.S. Coast Guard to provide system sustainment support for the Rescue 21 program.
|
•
|
$35 from the Army to provide continued software support and engineering for the Warfighter Information Network-Tactical (WIN-T) Increment 2 program.
|
•
|
A contract from the Navy to construct the first two Columbia-class submarines, which will be worth $11.5 billion when funding is received from Congress.
|
•
|
$130 from the Navy for capital expenditures and industrial base development in support of the Arleigh Burke-class (DDG-51) guided-missile destroyer program.
|
•
|
$80 from the Navy for Advanced Nuclear Plant Studies (ANPS) in support of the Columbia-class submarine program.
|
•
|
$55 from the Navy to support the Common Missile Compartment work under joint development for the Navy and the U.K. Royal Navy.
|
•
|
$45 from the Navy to provide ongoing lead yard services for the DDG-51 program.
|
Six Months Ended
|
June 28, 2020
|
|
June 30, 2019
|
||||
Net cash provided (used) by operating activities
|
$
|
177
|
|
|
$
|
(504
|
)
|
Capital expenditures
|
(406
|
)
|
|
(362
|
)
|
||
Free cash flow from operations
|
$
|
(229
|
)
|
|
$
|
(866
|
)
|
Cash flows as a percentage of net earnings:
|
|
|
|
||||
Net cash provided (used) by operating activities
|
13
|
%
|
|
(32
|
)%
|
||
Free cash flow from operations
|
(17
|
)%
|
|
(56
|
)%
|
Six Months Ended
|
June 28, 2020
|
||
Revenue
|
$
|
6,241
|
|
Operating costs and expenses, excluding G&A
|
(5,372
|
)
|
|
Net Earnings
|
285
|
|
|
June 28, 2020
|
|
December 31, 2019
|
||||
Cash and equivalents
|
$
|
1,727
|
|
|
$
|
606
|
|
Other current assets
|
2,443
|
|
|
2,367
|
|
||
Noncurrent assets
|
2,751
|
|
|
2,549
|
|
||
Total assets
|
$
|
6,921
|
|
|
$
|
5,522
|
|
|
|
|
|
||||
Short-term debt and current portion of long-term debt
|
$
|
3,734
|
|
|
$
|
2,497
|
|
Other current liabilities
|
2,707
|
|
|
2,642
|
|
||
Long-term debt
|
10,414
|
|
|
8,965
|
|
||
Other noncurrent liabilities
|
5,409
|
|
|
5,665
|
|
||
Total liabilities
|
$
|
22,264
|
|
|
$
|
19,769
|
|
•
|
general U.S. and international political and economic conditions;
|
•
|
the negative impact of the COVID-19 outbreak, or other similar outbreaks;
|
•
|
decreases in U.S. government defense spending or changing priorities within the defense budget;
|
•
|
termination or restructuring of government contracts due to unilateral government action;
|
•
|
differences in anticipated and actual program performance, including the ability to perform under long-term, fixed-price contracts within estimated costs, and performance issues with key suppliers and subcontractors;
|
•
|
expected recovery on contract claims and requests for equitable adjustment;
|
•
|
changing customer demand or preferences for business aircraft, including the effects of economic conditions on the business-aircraft market;
|
•
|
potential for changing prices for energy and raw materials;
|
•
|
the status or outcome of legal and/or regulatory proceedings;
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•
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potential effects of audits and reviews by government agencies of our government contract performance, compliance and internal control systems and policies;
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•
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risks and uncertainties relating to our acquisitions and joint ventures; and
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•
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potential for cybersecurity events and other disruptions.
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22
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31.1
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31.2
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32.1
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32.2
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101.INS
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Inline eXtensible Business Reporting Language (XBRL) Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
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101.SCH
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Inline XBRL Taxonomy Extension Schema Document*
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101.CAL
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Inline XBRL Taxonomy Extension Calculation Linkbase Document*
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101.DEF
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Inline XBRL Taxonomy Extension Definition Linkbase Document*
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101.LAB
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Inline XBRL Taxonomy Extension Label Linkbase Document*
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101.PRE
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Inline XBRL Taxonomy Extension Presentation Linkbase Document*
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104
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Cover Page Interactive Data File (embedded within the Inline XBRL document and contained in Exhibit 101)
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GENERAL DYNAMICS CORPORATION
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by
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William A. Moss
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Vice President and Controller
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(Authorized Officer and Chief Accounting Officer)
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Dated: July 29, 2020
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1.
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I have reviewed this quarterly report on Form 10-Q of General Dynamics Corporation;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:
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(a)
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designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;
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(b)
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designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors:
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(a)
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all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ Phebe N. Novakovic
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Phebe N. Novakovic
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Chairman and Chief Executive Officer
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1.
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I have reviewed this quarterly report on Form 10-Q of General Dynamics Corporation;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:
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(a)
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designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;
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(b)
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designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors:
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(a)
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all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ Jason W. Aiken
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Jason W. Aiken
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Senior Vice President and Chief Financial Officer
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1.
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the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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2.
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the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ Phebe N. Novakovic
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Phebe N. Novakovic
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Chairman and Chief Executive Officer
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1.
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the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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2.
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the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ Jason W. Aiken
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Jason W. Aiken
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Senior Vice President and Chief Financial Officer
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