Harris Corporation HRS
Q4 2010 Earnings Call Transcript

Transcript Call Date 08/03/2010

Operator: Good day, ladies and gentlemen, and welcome to the Fourth Quarter 2010 Harris Corporation Earnings Conference Call. My name is Kaitlin and I will be your operator for today. At this time, all participants are in listen-only mode. Later, we will conduct a question-and-answer session. (Operator Instructions). As a reminder, this conference is being recorded for replay purposes.

I would now like to turn the call over to your host for today, Ms. Pamela Padgett of Harris Corporation. Please proceed.

Pamela Padgett - VP, IR: Thank you and good afternoon everyone, and welcome to Harris's fourth quarter fiscal 2010 conference call. On the call with me today is Howard Lance, Chairman, President and CEO; Gary McArthur, Senior Vice President and Chief Financial Officer.

A few words about forward-looking statements. In the course of this teleconference, management may make forward-looking statements. Forward-looking statements involve assumptions, risks, and uncertainties that could cause actual results to differ materially from those statements. For more information and a discussion of such assumptions, risks and uncertainties please see the press release and filings made by Harris with the SEC.

In addition, in our press release and on this teleconference, we will discuss certain financial measures and information that are non-GAAP financial measures. A reconciliation to the comparable GAAP measures is included in the table of our press release, and on the Investor Relations section of our website, which is A replay of this call will also be available on the Investor Relations section of our website.

With that, Howard, I'll turn it over to you.

Howard L. Lance - Chairman, President and CEO: Thank you, Pam and welcome everyone to our fourth quarter fiscal 2010 earnings call. Harris ended fiscal 2010 with a very strong quarter. Orders, revenue and income were significantly higher than the prior year quarter and we generated significant operating cash flow. Orders were higher than revenue further increasing our backlog.

Revenue in the fourth quarter was $1.46 billion, that's 13% higher than the prior year. On an organic basis, excluding the impact of acquisitions, revenue was 8% higher.

Non-GAAP income, which excludes acquisition-related cost, was $161 million in the fourth quarter or $1.24 per diluted share, that's an increase of 38% compared with the prior year quarter.

Orders in the fourth quarter were $1.72 billion and that's 33% higher than the prior year quarter. We saw a continued strong performance in the quarter in the RF Communications segment as well as strong underlying revenue growth and excellent program execution across the Government Communications Systems segment.

Our track record of delivering consistent growth in revenue and earnings continued in fiscal 2010 with momentum building as the year progressed.

Revenue for the full fiscal year was $5.21 billion, 4% higher than the prior year. Non-GAAP income was $582 million or $4.43 per diluted share, that's an increase of 15% compared with the prior year. Orders for the full year were a record is $6.08 billion, 36% higher than fiscal 2009. As a result of the full year book-to-bill of 1.2, we have very strong momentum as we begin fiscal 2011.

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