x
|
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
|
o
|
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
|
DELAWARE
|
|
80-0640649
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
|
|
|
2980 Fairview Park Drive,
Falls Church, Virginia
|
|
22042
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Yes
x
|
|
No
o
|
Yes
x
|
|
No
o
|
Large accelerated filer
x
|
|
Accelerated filer
o
|
||||
|
|
|
||||
Non-accelerated filer
o
(Do not check if a smaller reporting company)
|
|
Smaller reporting company
o
|
||||
|
|
|
|
|
|
|
|
|
Emerging growth company
o
|
Yes
o
|
|
No
x
|
|
|
Page
|
|
|
|
Item 1.
|
|
|
|
||
|
||
|
||
|
||
|
|
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
Item 2.
|
|
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
Item 3.
|
||
Item 4.
|
||
|
|
|
|
|
|
Item 1.
|
||
Item 1A.
|
||
Item 2.
|
||
Item 3.
|
||
Item 4.
|
||
Item 5.
|
||
Item 6.
|
||
|
|
Three Months Ended June 30
|
|
Six Months Ended June 30
|
||||||||||||
$ in millions, except per share amounts
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Sales
|
|
|
|
|
|
|
|
||||||||
Product
|
$
|
3,916
|
|
|
$
|
3,560
|
|
|
$
|
7,750
|
|
|
$
|
7,038
|
|
Service
|
2,459
|
|
|
2,440
|
|
|
4,892
|
|
|
4,918
|
|
||||
Total sales
|
6,375
|
|
|
6,000
|
|
|
12,642
|
|
|
11,956
|
|
||||
Operating costs and expenses
|
|
|
|
|
|
|
|
||||||||
Product
|
2,958
|
|
|
2,621
|
|
|
5,829
|
|
|
5,232
|
|
||||
Service
|
1,896
|
|
|
1,962
|
|
|
3,783
|
|
|
3,912
|
|
||||
General and administrative expenses
|
666
|
|
|
620
|
|
|
1,343
|
|
|
1,276
|
|
||||
Operating income
|
855
|
|
|
797
|
|
|
1,687
|
|
|
1,536
|
|
||||
Other (expense) income
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
(76
|
)
|
|
(74
|
)
|
|
(151
|
)
|
|
(150
|
)
|
||||
Other, net
|
28
|
|
|
7
|
|
|
44
|
|
|
20
|
|
||||
Earnings before income taxes
|
807
|
|
|
730
|
|
|
1,580
|
|
|
1,406
|
|
||||
Federal and foreign income tax expense
|
255
|
|
|
213
|
|
|
388
|
|
|
333
|
|
||||
Net earnings
|
$
|
552
|
|
|
$
|
517
|
|
|
$
|
1,192
|
|
|
$
|
1,073
|
|
|
|
|
|
|
|
|
|
||||||||
Basic earnings per share
|
$
|
3.16
|
|
|
$
|
2.87
|
|
|
$
|
6.82
|
|
|
$
|
5.94
|
|
Weighted-average common shares outstanding, in millions
|
174.5
|
|
|
180.1
|
|
|
174.7
|
|
|
180.7
|
|
||||
Diluted earnings per share
|
$
|
3.15
|
|
|
$
|
2.85
|
|
|
$
|
6.78
|
|
|
$
|
5.88
|
|
Weighted-average diluted shares outstanding, in millions
|
175.5
|
|
|
181.5
|
|
|
175.8
|
|
|
182.4
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Net earnings (from above)
|
$
|
552
|
|
|
$
|
517
|
|
|
$
|
1,192
|
|
|
$
|
1,073
|
|
Other comprehensive income
|
|
|
|
|
|
|
|
||||||||
Change in unamortized benefit plan costs, net of tax
|
102
|
|
|
100
|
|
|
201
|
|
|
201
|
|
||||
Change in cumulative translation adjustment
|
(4
|
)
|
|
(9
|
)
|
|
—
|
|
|
(13
|
)
|
||||
Other, net
|
1
|
|
|
1
|
|
|
3
|
|
|
—
|
|
||||
Other comprehensive income, net of tax
|
99
|
|
|
92
|
|
|
204
|
|
|
188
|
|
||||
Comprehensive income
|
$
|
651
|
|
|
$
|
609
|
|
|
$
|
1,396
|
|
|
$
|
1,261
|
|
$ in millions
|
June 30,
2017 |
|
December 31,
2016 |
||||
Assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
1,383
|
|
|
$
|
2,541
|
|
Accounts receivable, net
|
4,280
|
|
|
3,299
|
|
||
Inventoried costs, net
|
1,039
|
|
|
816
|
|
||
Prepaid expenses and other current assets
|
162
|
|
|
200
|
|
||
Total current assets
|
6,864
|
|
|
6,856
|
|
||
Property, plant and equipment, net of accumulated depreciation of $4,965 in 2017 and $4,831 in 2016
|
3,802
|
|
|
3,588
|
|
||
Goodwill
|
12,453
|
|
|
12,450
|
|
||
Deferred tax assets
|
1,385
|
|
|
1,462
|
|
||
Other non-current assets
|
1,309
|
|
|
1,258
|
|
||
Total assets
|
$
|
25,813
|
|
|
$
|
25,614
|
|
|
|
|
|
||||
Liabilities
|
|
|
|
||||
Trade accounts payable
|
$
|
1,385
|
|
|
$
|
1,554
|
|
Accrued employee compensation
|
1,213
|
|
|
1,342
|
|
||
Advance payments and amounts in excess of costs incurred
|
1,340
|
|
|
1,471
|
|
||
Other current liabilities
|
2,248
|
|
|
1,263
|
|
||
Total current liabilities
|
6,186
|
|
|
5,630
|
|
||
Long-term debt, net of current portion of $862 in 2017 and $12 in 2016
|
6,219
|
|
|
7,058
|
|
||
Pension and other post-retirement benefit plan liabilities
|
6,666
|
|
|
6,818
|
|
||
Other non-current liabilities
|
823
|
|
|
849
|
|
||
Total liabilities
|
19,894
|
|
|
20,355
|
|
||
|
|
|
|
||||
Commitments and contingencies (Note 7)
|
|
|
|
||||
|
|
|
|
||||
Shareholders’ equity
|
|
|
|
||||
Preferred stock, $1 par value; 10,000,000 shares authorized; no shares issued and outstanding
|
—
|
|
|
—
|
|
||
Common stock, $1 par value; 800,000,000 shares authorized; issued and outstanding: 2017—174,150,501 and 2016—175,068,263
|
174
|
|
|
175
|
|
||
Paid-in capital
|
—
|
|
|
—
|
|
||
Retained earnings
|
11,087
|
|
|
10,630
|
|
||
Accumulated other comprehensive loss
|
(5,342
|
)
|
|
(5,546
|
)
|
||
Total shareholders’ equity
|
5,919
|
|
|
5,259
|
|
||
Total liabilities and shareholders’ equity
|
$
|
25,813
|
|
|
$
|
25,614
|
|
|
Six Months Ended June 30
|
||||||
$ in millions
|
2017
|
|
2016
|
||||
Operating activities
|
|
|
|
||||
Net earnings
|
$
|
1,192
|
|
|
$
|
1,073
|
|
Adjustments to reconcile to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
211
|
|
|
209
|
|
||
Stock-based compensation
|
42
|
|
|
37
|
|
||
Deferred income taxes
|
(47
|
)
|
|
(89
|
)
|
||
Changes in assets and liabilities:
|
|
|
|
||||
Accounts receivable, net
|
(981
|
)
|
|
(647
|
)
|
||
Inventoried costs, net
|
(223
|
)
|
|
(170
|
)
|
||
Prepaid expenses and other assets
|
(25
|
)
|
|
7
|
|
||
Accounts payable and other liabilities
|
(310
|
)
|
|
(287
|
)
|
||
Income taxes payable
|
90
|
|
|
225
|
|
||
Retiree benefits
|
165
|
|
|
209
|
|
||
Other, net
|
(46
|
)
|
|
(23
|
)
|
||
Net cash provided by operating activities
|
68
|
|
|
544
|
|
||
|
|
|
|
||||
Investing activities
|
|
|
|
||||
Capital expenditures
|
(433
|
)
|
|
(471
|
)
|
||
Other, net
|
7
|
|
|
2
|
|
||
Net cash used in investing activities
|
(426
|
)
|
|
(469
|
)
|
||
|
|
|
|
||||
Financing activities
|
|
|
|
||||
Common stock repurchases
|
(367
|
)
|
|
(682
|
)
|
||
Payments of long-term debt
|
—
|
|
|
(107
|
)
|
||
Cash dividends paid
|
(341
|
)
|
|
(322
|
)
|
||
Payments of employee taxes withheld from share-based awards
|
(91
|
)
|
|
(150
|
)
|
||
Other, net
|
(1
|
)
|
|
6
|
|
||
Net cash used in financing activities
|
(800
|
)
|
|
(1,255
|
)
|
||
Decrease in cash and cash equivalents
|
(1,158
|
)
|
|
(1,180
|
)
|
||
Cash and cash equivalents, beginning of year
|
2,541
|
|
|
2,319
|
|
||
Cash and cash equivalents, end of period
|
$
|
1,383
|
|
|
$
|
1,139
|
|
|
Six Months Ended June 30
|
||||||
$ in millions, except per share amounts
|
2017
|
|
2016
|
||||
Common stock
|
|
|
|
||||
Beginning of year
|
$
|
175
|
|
|
$
|
181
|
|
Common stock repurchased
|
(2
|
)
|
|
(3
|
)
|
||
Shares issued for employee stock awards and options
|
1
|
|
|
1
|
|
||
End of period
|
174
|
|
|
179
|
|
||
Paid-in capital
|
|
|
|
||||
Beginning of year
|
—
|
|
|
—
|
|
||
End of period
|
—
|
|
|
—
|
|
||
Retained earnings
|
|
|
|
||||
Beginning of year
|
10,630
|
|
|
10,661
|
|
||
Common stock repurchased
|
(351
|
)
|
|
(686
|
)
|
||
Net earnings
|
1,192
|
|
|
1,073
|
|
||
Dividends declared
|
(336
|
)
|
|
(310
|
)
|
||
Stock compensation
|
(48
|
)
|
|
(104
|
)
|
||
End of period
|
11,087
|
|
|
10,634
|
|
||
Accumulated other comprehensive loss
|
|
|
|
||||
Beginning of year
|
(5,546
|
)
|
|
(5,320
|
)
|
||
Other comprehensive income, net of tax
|
204
|
|
|
188
|
|
||
End of period
|
(5,342
|
)
|
|
(5,132
|
)
|
||
Total shareholders’ equity
|
$
|
5,919
|
|
|
$
|
5,681
|
|
Cash dividends declared per share
|
$
|
1.90
|
|
|
$
|
1.70
|
|
|
Three Months Ended June 30
|
|
Six Months Ended June 30
|
||||||||||||
$ in millions, except per share data
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Operating Income
|
$
|
98
|
|
|
$
|
137
|
|
|
$
|
213
|
|
|
$
|
266
|
|
Net Earnings
(1)
|
63
|
|
|
89
|
|
|
138
|
|
|
173
|
|
||||
Diluted earnings per share
(1)
|
0.36
|
|
|
0.49
|
|
|
0.78
|
|
|
0.95
|
|
(1)
|
Based on statutory tax rates
|
$ in millions
|
June 30,
2017 |
|
December 31,
2016 |
||||
Unamortized benefit plan costs, net of tax benefit of $3,317 in 2017 and $3,439 in 2016
|
$
|
(5,215
|
)
|
|
$
|
(5,416
|
)
|
Cumulative translation adjustment
|
(132
|
)
|
|
(132
|
)
|
||
Net unrealized gain on marketable securities and cash flow hedges, net of tax
|
5
|
|
|
2
|
|
||
Total accumulated other comprehensive loss
|
$
|
(5,342
|
)
|
|
$
|
(5,546
|
)
|
|
|
|
|
|
|
|
|
|
|
Shares Repurchased
(in millions) |
|||||||||
Repurchase Program
Authorization Date |
|
Amount
Authorized (in millions) |
|
Total
Shares Retired (in millions) |
|
Average
Price Per Share (1) |
|
Date Completed
|
|
Six Months Ended June 30
|
|||||||||
|
2017
|
|
2016
|
||||||||||||||||
December 4, 2014
|
|
$
|
3,000
|
|
|
18.0
|
|
|
$
|
166.70
|
|
|
March 2016
|
|
—
|
|
|
1.4
|
|
September 16, 2015
|
|
$
|
4,000
|
|
|
7.3
|
|
|
$
|
222.50
|
|
|
|
|
1.5
|
|
|
2.0
|
|
(1)
|
Includes commissions paid.
|
|
Three Months Ended June 30
|
|
Six Months Ended June 30
|
||||||||||||
$ in millions
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Sales
|
|
|
|
|
|
|
|
||||||||
Aerospace Systems
|
$
|
2,970
|
|
|
$
|
2,600
|
|
|
$
|
5,868
|
|
|
$
|
5,174
|
|
Mission Systems
|
2,781
|
|
|
2,690
|
|
|
5,520
|
|
|
5,383
|
|
||||
Technology Services
|
1,175
|
|
|
1,213
|
|
|
2,369
|
|
|
2,427
|
|
||||
Intersegment eliminations
|
(551
|
)
|
|
(503
|
)
|
|
(1,115
|
)
|
|
(1,028
|
)
|
||||
Total sales
|
6,375
|
|
|
6,000
|
|
|
12,642
|
|
|
11,956
|
|
||||
Operating income
|
|
|
|
|
|
|
|
||||||||
Aerospace Systems
|
315
|
|
|
312
|
|
|
627
|
|
|
598
|
|
||||
Mission Systems
|
374
|
|
|
351
|
|
|
727
|
|
|
704
|
|
||||
Technology Services
|
134
|
|
|
131
|
|
|
265
|
|
|
257
|
|
||||
Intersegment eliminations
|
(70
|
)
|
|
(63
|
)
|
|
(140
|
)
|
|
(127
|
)
|
||||
Total segment operating income
|
753
|
|
|
731
|
|
|
1,479
|
|
|
1,432
|
|
||||
Net FAS/CAS pension adjustment
|
137
|
|
|
69
|
|
|
273
|
|
|
143
|
|
||||
Unallocated corporate expenses
|
(34
|
)
|
|
(3
|
)
|
|
(63
|
)
|
|
(36
|
)
|
||||
Other
|
(1
|
)
|
|
—
|
|
|
(2
|
)
|
|
(3
|
)
|
||||
Total operating income
|
$
|
855
|
|
|
$
|
797
|
|
|
$
|
1,687
|
|
|
$
|
1,536
|
|
|
Three Months Ended June 30
|
|
Six Months Ended June 30
|
||||||||||||
$ in millions
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Federal and foreign income tax expense
|
$
|
255
|
|
|
$
|
213
|
|
|
$
|
388
|
|
|
$
|
333
|
|
Effective income tax rate
|
31.6
|
%
|
|
29.2
|
%
|
|
24.6
|
%
|
|
23.7
|
%
|
|
|
June 30, 2017
|
|
December 31, 2016
|
||||||||||||||||||||
$ in millions
|
|
Level 1
|
|
Level 2
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Total
|
||||||||||||
Financial Assets (Liabilities)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Marketable securities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Trading
|
|
$
|
327
|
|
|
$
|
1
|
|
|
$
|
328
|
|
|
$
|
321
|
|
|
$
|
2
|
|
|
$
|
323
|
|
Available-for-sale
|
|
12
|
|
|
—
|
|
|
12
|
|
|
7
|
|
|
—
|
|
|
7
|
|
||||||
Derivatives
|
|
—
|
|
|
5
|
|
|
5
|
|
|
—
|
|
|
8
|
|
|
8
|
|
$ in millions
|
|
Range of Reasonably Possible Future Costs
(1)
|
|
Accrued Costs
(2)
|
|
Deferred Costs
(3)
|
||||
June 30, 2017
|
|
$389 - $782
|
|
$
|
393
|
|
|
$
|
202
|
|
December 31, 2016
|
|
379 - 774
|
|
385
|
|
|
195
|
|
(1)
|
Estimated remediation costs are not discounted to present value. The range of reasonably possible future costs does not take into consideration amounts expected to be recoverable through overhead charges on U.S. Government contracts.
|
|
Three Months Ended June 30
|
Six Months Ended June 30
|
||||||||||||||||||||||||||||
|
Pension
Benefits |
|
Medical and
Life Benefits |
Pension
Benefits |
|
Medical and
Life Benefits |
||||||||||||||||||||||||
$ in millions
|
2017
|
|
2016
|
|
2017
|
|
2016
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||||||||||
Components of net periodic benefit cost
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Service cost
|
$
|
114
|
|
|
$
|
111
|
|
|
$
|
7
|
|
|
$
|
7
|
|
$
|
228
|
|
|
$
|
223
|
|
|
$
|
13
|
|
|
$
|
15
|
|
Interest cost
|
308
|
|
|
321
|
|
|
21
|
|
|
23
|
|
617
|
|
|
642
|
|
|
42
|
|
|
47
|
|
||||||||
Expected return on plan assets
|
(472
|
)
|
|
(463
|
)
|
|
(23
|
)
|
|
(22
|
)
|
(943
|
)
|
|
(926
|
)
|
|
(45
|
)
|
|
(43
|
)
|
||||||||
Amortization of:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Prior service credit
|
(14
|
)
|
|
(15
|
)
|
|
(6
|
)
|
|
(5
|
)
|
(29
|
)
|
|
(30
|
)
|
|
(11
|
)
|
|
(11
|
)
|
||||||||
Net loss from previous years
|
178
|
|
|
179
|
|
|
3
|
|
|
5
|
|
356
|
|
|
357
|
|
|
5
|
|
|
8
|
|
||||||||
Net periodic benefit cost
|
$
|
114
|
|
|
$
|
133
|
|
|
$
|
2
|
|
|
$
|
8
|
|
$
|
229
|
|
|
$
|
266
|
|
|
$
|
4
|
|
|
$
|
16
|
|
|
Three Months Ended June 30
|
|
Six Months Ended June 30
|
||||||||||||
$ in millions
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Defined benefit pension plans
|
$
|
28
|
|
|
$
|
20
|
|
|
$
|
51
|
|
|
$
|
47
|
|
Medical and life benefit plans
|
13
|
|
|
18
|
|
|
24
|
|
|
29
|
|
||||
Defined contribution plans
|
77
|
|
|
71
|
|
|
176
|
|
|
158
|
|
|
|
Six Months Ended June 30
|
|||||
in millions
|
|
2017
|
2016
|
||||
RSRs granted
|
|
0.1
|
|
0.2
|
|
||
RPSRs granted
|
|
0.3
|
|
0.3
|
|
||
Grant date aggregate fair value
|
|
$
|
91
|
|
$
|
88
|
|
|
|
Six Months Ended June 30
|
|||||
$ in millions
|
|
2017
|
2016
|
||||
Minimum aggregate payout amount
|
|
$
|
35
|
|
$
|
34
|
|
Maximum aggregate payout amount
|
|
198
|
|
193
|
|
|
Three Months Ended June 30
|
|
%
|
|
Six Months Ended June 30
|
|
%
|
||||||||||||||
$ in millions, except per share amounts
|
2017
|
|
2016
|
|
Change
|
|
2017
|
|
2016
|
|
Change
|
||||||||||
Sales
|
$
|
6,375
|
|
|
$
|
6,000
|
|
|
6
|
%
|
|
$
|
12,642
|
|
|
$
|
11,956
|
|
|
6
|
%
|
Operating costs and expenses
|
5,520
|
|
|
5,203
|
|
|
6
|
%
|
|
10,955
|
|
|
10,420
|
|
|
5
|
%
|
||||
Operating costs and expenses as a % of sales
|
86.6
|
%
|
|
86.7
|
%
|
|
|
|
86.7
|
%
|
|
87.2
|
%
|
|
|
||||||
Operating income
|
855
|
|
|
797
|
|
|
7
|
%
|
|
1,687
|
|
|
1,536
|
|
|
10
|
%
|
||||
Operating margin rate
|
13.4
|
%
|
|
13.3
|
%
|
|
|
|
13.3
|
%
|
|
12.8
|
%
|
|
|
||||||
Federal and foreign income tax expense
|
255
|
|
|
213
|
|
|
20
|
%
|
|
388
|
|
|
333
|
|
|
17
|
%
|
||||
Effective income tax rate
|
31.6
|
%
|
|
29.2
|
%
|
|
|
|
24.6
|
%
|
|
23.7
|
%
|
|
|
||||||
Net earnings
|
552
|
|
|
517
|
|
|
7
|
%
|
|
1,192
|
|
|
1,073
|
|
|
11
|
%
|
||||
Diluted earnings per share
|
$
|
3.15
|
|
|
$
|
2.85
|
|
|
11
|
%
|
|
$
|
6.78
|
|
|
$
|
5.88
|
|
|
15
|
%
|
Aerospace Systems
|
|
Mission Systems
|
|
Technology Services
|
Autonomous Systems
|
|
Sensors and Processing
|
|
Global Logistics and Modernization
|
Manned Aircraft
|
|
Cyber and ISR
|
|
Advanced Defense Services
|
Space
|
|
Advanced Capabilities
|
|
System Modernization and Services
|
|
Three Months Ended June 30
|
|
%
|
|
Six Months Ended June 30
|
|
%
|
||||||||||||||
$ in millions
|
2017
|
|
2016
|
|
Change
|
|
2017
|
|
2016
|
|
Change
|
||||||||||
Segment operating income
|
$
|
753
|
|
|
$
|
731
|
|
|
3
|
%
|
|
$
|
1,479
|
|
|
$
|
1,432
|
|
|
3
|
%
|
Segment operating margin rate
|
11.8
|
%
|
|
12.2
|
%
|
|
|
|
11.7
|
%
|
|
12.0
|
%
|
|
|
|
Three Months Ended June 30
|
|
Six Months Ended June 30
|
||||||||||||
$ in millions
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Segment operating income
|
$
|
753
|
|
|
$
|
731
|
|
|
$
|
1,479
|
|
|
$
|
1,432
|
|
CAS pension expense
|
251
|
|
|
202
|
|
|
502
|
|
|
409
|
|
||||
Less: FAS pension expense
|
(114
|
)
|
|
(133
|
)
|
|
(229
|
)
|
|
(266
|
)
|
||||
Net FAS/CAS pension adjustment
|
137
|
|
|
69
|
|
|
273
|
|
|
143
|
|
||||
Unallocated corporate expenses
|
(34
|
)
|
|
(3
|
)
|
|
(63
|
)
|
|
(36
|
)
|
||||
Other
|
(1
|
)
|
|
—
|
|
|
(2
|
)
|
|
(3
|
)
|
||||
Total operating income
|
$
|
855
|
|
|
$
|
797
|
|
|
$
|
1,687
|
|
|
$
|
1,536
|
|
|
Three Months Ended June 30
|
|
Six Months Ended June 30
|
||||||||||||
$ in millions
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Favorable EAC adjustments
|
$
|
153
|
|
|
$
|
199
|
|
|
$
|
313
|
|
|
$
|
399
|
|
Unfavorable EAC adjustments
|
(55
|
)
|
|
(62
|
)
|
|
(100
|
)
|
|
(133
|
)
|
||||
Net EAC adjustments
|
$
|
98
|
|
|
$
|
137
|
|
|
$
|
213
|
|
|
$
|
266
|
|
|
Three Months Ended June 30
|
|
Six Months Ended June 30
|
||||||||||||
$ in millions
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Aerospace Systems
|
$
|
61
|
|
|
$
|
83
|
|
|
$
|
115
|
|
|
$
|
142
|
|
Mission Systems
|
24
|
|
|
45
|
|
|
72
|
|
|
100
|
|
||||
Technology Services
|
15
|
|
|
16
|
|
|
33
|
|
|
37
|
|
||||
Eliminations
|
(2
|
)
|
|
(7
|
)
|
|
(7
|
)
|
|
(13
|
)
|
||||
Net EAC adjustments
|
$
|
98
|
|
|
$
|
137
|
|
|
$
|
213
|
|
|
$
|
266
|
|
|
Three Months Ended June 30
|
|
%
|
|
Six Months Ended June 30
|
|
%
|
||||||||||||||
$ in millions
|
2017
|
|
2016
|
|
Change
|
|
2017
|
|
2016
|
|
Change
|
||||||||||
Sales
|
$
|
2,970
|
|
|
$
|
2,600
|
|
|
14
|
%
|
|
$
|
5,868
|
|
|
$
|
5,174
|
|
|
13
|
%
|
Operating income
|
315
|
|
|
312
|
|
|
1
|
%
|
|
627
|
|
|
598
|
|
|
5
|
%
|
||||
Operating margin rate
|
10.6
|
%
|
|
12.0
|
%
|
|
|
|
10.7
|
%
|
|
11.6
|
%
|
|
|
|
Three Months Ended June 30
|
|
%
|
|
Six Months Ended June 30
|
|
%
|
||||||||||||||
$ in millions
|
2017
|
|
2016
|
|
Change
|
|
2017
|
|
2016
|
|
Change
|
||||||||||
Sales
|
$
|
2,781
|
|
|
$
|
2,690
|
|
|
3
|
%
|
|
$
|
5,520
|
|
|
$
|
5,383
|
|
|
3
|
%
|
Operating income
|
374
|
|
|
351
|
|
|
7
|
%
|
|
727
|
|
|
704
|
|
|
3
|
%
|
||||
Operating margin rate
|
13.4
|
%
|
|
13.0
|
%
|
|
|
|
13.2
|
%
|
|
13.1
|
%
|
|
|
|
Three Months Ended June 30
|
|
%
|
|
Six Months Ended June 30
|
|
%
|
||||||||||||||
$ in millions
|
2017
|
|
2016
|
|
Change
|
|
2017
|
|
2016
|
|
Change
|
||||||||||
Sales
|
$
|
1,175
|
|
|
$
|
1,213
|
|
|
(3
|
)%
|
|
$
|
2,369
|
|
|
$
|
2,427
|
|
|
(2
|
)%
|
Operating income
|
134
|
|
|
131
|
|
|
2
|
%
|
|
265
|
|
|
257
|
|
|
3
|
%
|
||||
Operating margin rate
|
11.4
|
%
|
|
10.8
|
%
|
|
|
|
11.2
|
%
|
|
10.6
|
%
|
|
|
|
Three Months Ended June 30
|
|
Six Months Ended June 30
|
||||||||||||||||||||||
$ in millions
|
2017
|
2016
|
|
2017
|
2016
|
||||||||||||||||||||
Segment Information:
|
Sales
|
Operating Costs and Expenses
|
Sales
|
Operating Costs and Expenses
|
|
Sales
|
Operating Costs and Expenses
|
Sales
|
Operating Costs and Expenses
|
||||||||||||||||
Aerospace Systems
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Product
|
$
|
2,429
|
|
$
|
2,173
|
|
$
|
2,123
|
|
$
|
1,855
|
|
|
$
|
4,811
|
|
$
|
4,289
|
|
$
|
4,214
|
|
$
|
3,706
|
|
Service
|
541
|
|
482
|
|
477
|
|
433
|
|
|
1,057
|
|
952
|
|
960
|
|
870
|
|
||||||||
Mission Systems
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Product
|
1,677
|
|
1,440
|
|
1,575
|
|
1,343
|
|
|
3,328
|
|
2,863
|
|
3,113
|
|
2,687
|
|
||||||||
Service
|
1,104
|
|
967
|
|
1,115
|
|
996
|
|
|
2,192
|
|
1,930
|
|
2,270
|
|
1,992
|
|
||||||||
Technology Services
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Product
|
92
|
|
85
|
|
83
|
|
77
|
|
|
173
|
|
159
|
|
163
|
|
148
|
|
||||||||
Service
|
1,083
|
|
956
|
|
1,130
|
|
1,005
|
|
|
2,196
|
|
1,945
|
|
2,264
|
|
2,022
|
|
||||||||
Segment Totals
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Total Product
|
$
|
4,198
|
|
$
|
3,698
|
|
$
|
3,781
|
|
$
|
3,275
|
|
|
$
|
8,312
|
|
$
|
7,311
|
|
$
|
7,490
|
|
$
|
6,541
|
|
Total Service
|
2,728
|
|
2,405
|
|
2,722
|
|
2,434
|
|
|
5,445
|
|
4,827
|
|
5,494
|
|
4,884
|
|
||||||||
Intersegment eliminations
|
(551
|
)
|
(481
|
)
|
(503
|
)
|
(440
|
)
|
|
(1,115
|
)
|
(975
|
)
|
(1,028
|
)
|
(901
|
)
|
||||||||
Total segment
(1)
|
$
|
6,375
|
|
$
|
5,622
|
|
$
|
6,000
|
|
$
|
5,269
|
|
|
$
|
12,642
|
|
$
|
11,163
|
|
$
|
11,956
|
|
$
|
10,524
|
|
(1)
|
A reconciliation of segment operating income to total operating income is included in “Segment Operating Results.”
|
|
Six Months Ended June 30
|
||||||
$ in millions
|
2017
|
|
2016
|
||||
Net earnings
|
$
|
1,192
|
|
|
$
|
1,073
|
|
Non-cash items
(1)
|
206
|
|
|
157
|
|
||
Changes in assets and liabilities:
|
|
|
|
||||
Trade working capital
|
(1,449
|
)
|
|
(872
|
)
|
||
Retiree benefits
|
165
|
|
|
209
|
|
||
Other, net
|
(46
|
)
|
|
(23
|
)
|
||
Net cash provided by operating activities
|
$
|
68
|
|
|
$
|
544
|
|
(1)
|
Includes depreciation and amortization, stock based compensation expense and deferred income taxes.
|
|
Six Months Ended June 30
|
||||||
$ in millions
|
2017
|
|
2016
|
||||
Net cash provided by operating activities
|
$
|
68
|
|
|
$
|
544
|
|
Less: capital expenditures
|
(433
|
)
|
|
(471
|
)
|
||
Free cash flow
|
$
|
(365
|
)
|
|
$
|
73
|
|
•
|
our dependence on the U.S. Government for a substantial portion of our business
|
•
|
significant delays or reductions in appropriations for our programs and U.S. Government funding more broadly
|
•
|
investigations, claims, disputes and/or litigation
|
•
|
our exposure to additional risks as a result of our international business
|
•
|
the improper conduct of employees, agents, subcontractors, suppliers, business partners or joint ventures in which we participate and the impact on our reputation, our ability to do business, and our financial position, results of operations and/or cash flows
|
•
|
the use of estimates when accounting for our contracts and the effect of contract cost growth and/or changes in estimated contract revenues and costs
|
•
|
the performance and financial viability of our subcontractors and suppliers and the availability and pricing of raw materials and components
|
•
|
cyber and other security threats or disruptions faced by us, our customers or our partners
|
•
|
changes in procurement and other laws, regulations and practices applicable to our industry, findings by the U.S. Government, and changes in our customers’ business practices globally
|
•
|
increased competition within our markets and bid protests
|
•
|
the ability to maintain a qualified workforce
|
•
|
inability to meet performance obligations under our contracts
|
•
|
environmental matters, including unforeseen environmental costs and government and third party claims
|
•
|
natural and/or environmental disasters
|
•
|
the adequacy and availability of our insurance coverage, customer indemnifications or other liability protections
|
•
|
products and services we provide related to hazardous and high risk operations, which subject us to various environmental, regulatory, financial, reputational and other risks
|
•
|
the future investment performance of plan assets, changes in actuarial assumptions associated with our pension and other post-retirement benefit plans and legislative or other regulatory actions impacting our pension, post-retirement and health and welfare plans
|
•
|
changes in business conditions that could impact business investments and/or recorded goodwill or the value of other long-lived assets
|
•
|
our ability to exploit or protect intellectual property rights
|
•
|
inability to develop new products and technologies and maintain technologies, facilities, and equipment to win new competitions and meet the needs of our customers
|
•
|
unanticipated changes in our tax provisions or exposure to additional tax liabilities
|
Period
|
Total Number
of Shares
Purchased
|
|
Average
Price
Paid per
Share
(1)
|
|
Total Number
of Shares
Purchased as
Part of Publicly
Announced
Plans or
Programs
|
|
Approximate
Dollar Value of
Shares that May
Yet Be Purchased
under the
Plans or Programs
($ in millions)
|
|||||||
April 1, 2017 - April 28, 2017
|
127,005
|
|
|
$
|
241.13
|
|
|
127,005
|
|
|
|
$
|
2,473
|
|
April 29, 2017 - May 26, 2017
|
274,569
|
|
|
248.08
|
|
|
274,569
|
|
|
|
2,404
|
|
||
May 27, 2017 - June 30, 2017
|
148,121
|
|
|
256.87
|
|
|
148,121
|
|
|
|
2,366
|
|
||
Total
|
549,695
|
|
|
$
|
248.84
|
|
|
549,695
|
|
|
|
$
|
2,366
|
|
(1)
|
Includes commissions paid.
|
2.1
|
Agreement and Plan of Merger among Titan II, Inc. (formerly Northrop Grumman Corporation), Northrop Grumman Corporation (formerly New P, Inc.) and Titan Merger Sub Inc., dated March 29, 2011 (incorporated by reference to Exhibit 10.1 to Form 8-K filed April 4, 2011, File No. 001-16411)
|
|
|
2.2
|
Separation and Distribution Agreement dated as of March 29, 2011, among Titan II, Inc. (formerly Northrop Grumman Corporation), Northrop Grumman Corporation (formerly New P, Inc.), Huntington Ingalls Industries, Inc., Northrop Grumman Shipbuilding, Inc. and Northrop Grumman Systems Corporation (incorporated by reference to Exhibit 10.2 to Form 8-K filed April 4, 2011, File No. 001-16411)
|
|
|
*+10.1
|
Non-Employee Director Compensation Term Sheet, effective May 17, 2017
|
|
|
*+10.2
|
Grant Certificate Specifying the Terms and Conditions Applicable to 2017 Restricted Stock Rights Granted Under the 2011 Long-Term Incentive Stock Plan
|
|
|
*12(a)
|
Computation of Ratio of Earnings to Fixed Charges
|
|
|
*15
|
Letter from Independent Registered Public Accounting Firm
|
|
|
*31.1
|
Certification of Wesley G. Bush pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
|
*31.2
|
Certification of Kenneth L. Bedingfield pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
|
**32.1
|
Certification of Wesley G. Bush pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
|
**32.2
|
Certification of Kenneth L. Bedingfield pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
|
*101
|
Northrop Grumman Corporation Quarterly Report on Form 10-Q for the quarter ended June 30, 2017, formatted in XBRL (Extensible Business Reporting Language): (i) the Condensed Consolidated Statements of Earnings and Comprehensive Income, (ii) Condensed Consolidated Statements of Financial Position, (iii) Condensed Consolidated Statements of Cash Flows, (iv) Condensed Consolidated Statements of Changes in Shareholders’ Equity, and (v) Notes to Condensed Consolidated Financial Statements
|
+
|
Management contract or compensatory plan or arrangement
|
|
|
*
|
Filed with this report
|
|
|
**
|
Furnished with this report
|
NORTHROP GRUMMAN CORPORATION
(Registrant)
|
||
|
|
|
By:
|
|
/s/ Michael A. Hardesty
|
|
|
Michael A. Hardesty
Corporate Vice President, Controller and
Chief Accounting Officer
(Principal Accounting Officer)
|
Retainer:
|
|
Retainer fees are paid quarterly, at the end of each quarter. Fees are as follows:
|
|
|
|
|
|
|
|
Annual cash retainer:
|
$122,500
|
|
|
Additional retainer for Lead Independent Director:
|
$35,000
|
|
|
Additional retainer for Audit Committee:
|
$10,000
|
|
|
Additional retainer for Audit Committee chair:
|
$20,000
|
|
|
Additional retainer for Comp Committee chair:
|
$20,000
|
|
|
Additional retainer for Gov Committee chair:
|
$15,000
|
|
|
Additional retainer for Policy Committee chair:
|
$7,500
|
|
|
|
|
Equity Grant:
|
|
Directors are awarded an annual equity grant of $150,000 in deferred stock units (“Automatic Stock Units”), awarded annually on the day of the Company’s Annual Meeting of Shareholders. The Automatic Stock Units will vest on the one year anniversary of the grant date. Directors may elect to have all or any portion of their Automatic Stock Units paid on (A) the earlier of (i) the beginning of a specified calendar year after the vesting date or (ii) their separation from service as a member of the Board or (B) the vesting date.
|
|
|
|
|
|
Deferral of Cash Retainer:
|
|
Directors may elect to defer payment of all or a portion of their cash retainer fees and any other committee retainer fees into a deferred stock unit account (“Elective Stock Units”). Elective Stock Units are awarded on a calendar quarterly basis. Directors may elect to have all or a portion of their Elective Stock Units paid on the earlier of (i) the beginning of a specified calendar year or (ii) their separation from service as a member of the Board.
|
|
|
|
|
|
Elective Deferral Program:
|
|
Directors may elect to defer to a later year all or a portion of their annual cash retainer and any other fees payable for their Board service into alternative investment options similar to the options available under Northrop Grumman’s Savings Excess Plan.
|
|
|
|
|
|
1.
|
Vesting; Issuance of Shares
.
|
2.
|
Early Termination of Award; Termination of Employment
.
|
3.
|
Non-Transferability and Other Restrictions
.
|
5.
|
Compliance with Laws; No Stockholder Rights Prior to Issuance
.
|
6.
|
Adjustments; Change in Control
.
|
7.
|
Tax Matters
.
|
8.
|
Choice of Law; Venue; Arbitration
|
9.
|
Committee Authority
.
|
10.
|
Plan; Amendment
.
|
11.
|
Required Holding Period
.
|
12.
|
Definitions
.
|
(i)
|
The Grantee’s conviction for committing an act of fraud, embezzlement, theft, or other act constituting a felony (other than traffic related offenses, as a result of vicarious liability, or as a result of good faith actions as an officer of the Company); or
|
(ii)
|
The willful engaging by the Grantee in misconduct that is significantly injurious to the
|
(i)
|
A material and substantial reduction in the nature or status of the Grantee’s authorities or responsibilities (when such authorities and/or responsibilities are viewed in the aggregate) from their level in effect on the day immediately prior to the start of the Protected Period, other than (A) an inadvertent act that is remedied by the Company promptly after receipt of notice thereof given by the Grantee, and/or (B) changes in the nature or status of the Grantee’s authorities or responsibilities that, in the aggregate, would generally be viewed by a nationally-recognized executive placement firm as resulting in the Grantee having not materially and substantially fewer authorities and responsibilities (taking into consideration the Company’s industry) when
|
(ii)
|
A material reduction by the Company in the Grantee’s annualized rate of base salary as in effect at the start of the Protected Period, or as the same shall be increased from time to time.
|
(iii)
|
A material reduction in the aggregate value of the Grantee’s level of participation in any of the Company’s short and/or long-term incentive compensation plans (excluding stock-based incentive compensation plans), employee benefit or retirement plans, or policies, practices, or arrangements in which the Grantee participates immediately prior to the start of the Protected Period; provided, however, that a reduction in the aggregate value shall not be deemed to be “Good Reason” if the reduced value remains substantially consistent with the average level of other employees who have positions commensurate with the position held by the Grantee immediately prior to the start of the Protected Period.
|
(iv)
|
A material reduction in the Grantee’s aggregate level of participation in the Company’s stock-based incentive compensation plans from the level in effect immediately prior to the start of the Protected Period; provided, however, that a reduction in the aggregate level of participation shall not be deemed to be “Good Reason” if the
|
(v)
|
The Grantee is informed by the Company that his or her principal place of employment for the Company will be relocated to a location that is greater than fifty (50) miles away from the Grantee’s principal place of employment for the Company at the start of the corresponding Protected Period.
|
(i)
|
If the Change in Control is triggered by a tender offer for shares of the Company’s stock or by the offeror’s acquisition of shares pursuant to such a tender offer, the Protected Period shall commence on the date of the initial tender offer and shall continue through and including the date of the Change in Control; provided that in no case will the Protected Period commence earlier than the date that is six (6) months prior to the Change in Control.
|
(ii)
|
If the Change in Control is triggered by a merger, consolidation, or reorganization of the Company with or involving any other corporation, the Protected Period shall commence on the date that serious and substantial discussions first take
|
(iii)
|
In the case of any Change in Control not described in clause (i) or (ii) above, the Protected Period shall commence on the date that is six (6) months prior to the Change in Control and shall continue through and including the date of the Change in Control.
|
$ in millions
|
Six Months Ended June 30
|
|
Year Ended December 31
|
|||||||||||||||||||
Earnings:
|
2017
|
2016
|
|
2016
|
2015
|
2014
|
2013
|
2012
|
||||||||||||||
Earnings before income taxes
|
$
|
1,580
|
|
$
|
1,406
|
|
|
$
|
2,923
|
|
$
|
2,790
|
|
$
|
2,937
|
|
$
|
2,863
|
|
$
|
2,965
|
|
Fixed Charges:
|
|
|
|
|
|
|
|
|
||||||||||||||
Interest expense, including amortization of debt premium
|
151
|
|
150
|
|
|
301
|
|
301
|
|
282
|
|
257
|
|
212
|
|
|||||||
Portion of rental expenses on operating leases deemed to be representative of the interest factor
|
51
|
|
53
|
|
|
99
|
|
101
|
|
101
|
|
99
|
|
116
|
|
|||||||
Earnings before income taxes and fixed charges
|
$
|
1,782
|
|
$
|
1,609
|
|
|
$
|
3,323
|
|
$
|
3,192
|
|
$
|
3,320
|
|
$
|
3,219
|
|
$
|
3,293
|
|
Fixed Charges:
|
$
|
202
|
|
$
|
203
|
|
|
$
|
400
|
|
$
|
402
|
|
$
|
383
|
|
$
|
356
|
|
$
|
328
|
|
Ratio of earnings to fixed charges
|
8.8
|
|
7.9
|
|
|
8.3
|
|
7.9
|
|
8.7
|
|
9.0
|
|
10.0
|
|
1.
|
I have reviewed this report on Form
10-Q
of Northrop Grumman Corporation (“company”);
|
2.
|
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;
|
3.
|
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 company as of, and for, the periods presented in this report;
|
4.
|
The company'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 company and have:
|
a)
|
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 company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
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;
|
c)
|
Evaluated the effectiveness of the company'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
|
d)
|
Disclosed in this report any change in the company's internal control over financial reporting that occurred during the company's most recent fiscal quarter (the company's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the company's internal control over financial reporting; and
|
5.
|
The company's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company's auditors and the audit committee of the company's board of directors (or persons performing the equivalent functions):
|
a)
|
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 company's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the company's internal control over financial reporting.
|
/s/ Wesley G. Bush
|
Wesley G. Bush
|
Chairman, Chief Executive Officer and President
|
1.
|
I have reviewed this report on Form
10-Q
of Northrop Grumman Corporation (“company”);
|
2.
|
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;
|
3.
|
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 company as of, and for, the periods presented in this report;
|
4.
|
The company'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 company and have:
|
a)
|
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 company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
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;
|
c)
|
Evaluated the effectiveness of the company'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
|
d)
|
Disclosed in this report any change in the company's internal control over financial reporting that occurred during the company's most recent fiscal quarter (the company's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the company's internal control over financial reporting; and
|
5.
|
The company's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company's auditors and the audit committee of the company's board of directors (or persons performing the equivalent functions):
|
a)
|
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 company's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the company's internal control over financial reporting.
|
/s/ Kenneth L. Bedingfield
|
Kenneth L. Bedingfield
|
Corporate Vice President and Chief Financial Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the company.
|
/s/ Wesley G. Bush
|
Wesley G. Bush
|
Chairman, Chief Executive Officer and President
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the company.
|
/s/ Kenneth L. Bedingfield
|
Kenneth L. Bedingfield
|
Corporate Vice President and Chief Financial Officer
|