Download the Printable 96-Page 2020 Annual Report
Total Page：16
File Type：pdf, Size：1020Kb
2020 ANNUAL REPORT TEXTRON’S DIVERSE PRODUCT PORTFOLIO Textron is known around the world for its powerful brands of aircraft, defense and industrial products that provide customers with groundbreaking technologies, innovative solutions and first-class service. TEXTRON AVIATION BELL INDUSTRIAL TEXTRON SYSTEMS Citation Longitude® Bell V-280 Valor Tracker Off Road 800SX Ship-to-Shore Connector (SSC) Aerosonde® Small Unmanned Citation Latitude® Bell Boeing MV-22 Osprey Blast-M Arctic Cat Aircraft System Beechcraft® AT-6 Wolverine® Bell 360 Invictus E-Z-GO® RXV® ELiTETM RIPSAW® M5 LycomingTM iE2 Integrated Beechcraft® King Air® 360 Bell 525 Relentless Jacobsen Eclipse 360 Elite Electronic Engine Cessna SkyCourier® Bell 429 Global Ranger Kautex Fuel Tank ATAC’s Mirage F1B Fighter Jet Common Unmanned Surface Beechcraft® King Air® 260 Bell 505 Jet Ranger X Textron GSE TUGTM ALPHA 1 Vehicle (CUSV®) TEXTRON’S GLOBAL NETWORK OF BUSINESSES TEXTRON TEXTRON AVIATION BELL INDUSTRIAL SYSTEMS FINANCE Textron Aviation is home Bell is a leading supplier Our Industrial segment Textron Systems’ Our Finance segment, to the Beechcraft®, of helicopters and offers two main product businesses provide operated by Textron Cessna® and Hawker® related spare parts lines: fuel systems and innovative solutions to Financial Corporation aircraft brands and and services. Bell functional components the defense, aerospace (TFC), is a commercial continues to be a leader is the pioneer of the produced by Kautex; and general aviation finance business that in general aviation revolutionary tiltrotor and specialized vehicles markets. Product lines provides financing through two principal aircraft. Globally such as golf cars, include unmanned solutions for purchasers lines of business: recognized for world- recreational and utility systems, advanced of Textron products, aircraft and aftermarket. class customer service, vehicles, aviation ground marine craft, armored primarily Textron Aircraft includes sales of innovation and superior support equipment and vehicles, intelligent Aviation aircraft and Bell business jet, turboprop quality, Bell’s global professional mowers, software solutions, helicopters. For more and piston aircraft, as workforce serves manufactured by Textron piston engines, than five decades, TFC well as special mission customers flying Bell Specialized Vehicles simulation, training has played a key role for and military aircraft. aircraft in more than businesses. and other defense and Textron customers Aftermarket includes 130 countries. aviation mission support around the globe. commercial parts sales, products and services. maintenance, inspection and repair services. SELECTED (Dollars in Millions, Except Per Share Amounts) 2020 2019 YEAR-OVER- Total Revenues $11,651 $13,630 Total Segment Profit 751 1,270 YEAR Net Income—GAAP 309 815 1 FINANCIAL Adjusted Net Income—Non-GAAP 475 870 Per Share of Common Stock DATA Common Stock Price at Year-End $ 48.33 $ 44.74 Diluted Net Income—GAAP 1.35 3.50 Adjusted Diluted Net Income—Non-GAAP1 2.07 3.74 COMMON SHARES OUTSTANDING (In Thousands) Diluted Average 228,979 232,709 Year-End 226,444 227,956 FINANCIAL POSITION Total Assets $15,443 $15,018 Manufacturing Group Debt 3,707 3,124 Finance Group Debt 662 686 Shareholders’ Equity 5,845 5,518 1. Adjusted Net Income, Manufacturing Group Debt-to-Capital (Net of Cash) 21% 26% Adjusted Diluted Earnings Manufacturing Group Debt-to-Capital 39% 36% Per Share and Manufacturing Cash Flow Before Pension KEY PERFORMANCE METRICS Contributions are Non-GAAP Net Cash Provided by Operating Activities of Continuing Operations Measures. See page 7 for for Manufacturing Group—GAAP $ 833 $ 960 a Reconciliation to GAAP. Manufacturing Cash Flow Before Pension Contributions—Non-GAAP1 596 642 TEXTRON 2020 ANNUAL REPORT 1 2020 was a challenging year for our company as we worked through the impacts of the COVID-19 pandemic. FELLOW SHAREHOLDERS, 2020 was a challenging year for our company as we worked through the impacts of the COVID-19 pandemic. Our operations have experienced and continue to experience various degrees JANUARY of disruption due to the unprecedented conditions surrounding the pandemic. Across our businesses, we established Scott C. Donnelly Chairman and enterprise-wide pandemic response Chief Executive Officer teams and implemented processes and procedures to enhance the safety of Our Future Vertical Lift programs at our facilities and protect the health and Bell advanced in 2020. Both the Bell ® safety of our employees. V-280 Valor and Bell 360 Invictus were RIPSAW M5 WINS ARMY’S ROBOTIC COMBAT VEHICLE MEDIUM PROGRAM At our defense businesses, through down-selected by the U.S. Army for the the hard work of our teams, we were next rounds of the Future Long-Range able to maintain our operations, meet Assault Aircraft (FLRAA) and Future our customer commitments and deliver Attack Reconnaissance Aircraft (FARA) FEBRUARY strong results. At our commercial programs, respectively. The down- businesses, we temporarily closed some selects illustrate the outstanding design, of our manufacturing facilities due to innovation and tested technologies that reduced demand for certain products can fulfill the Army’s FLRAA and FARA during the first quarter and latter part of requirements at an affordable cost and the second quarter. In the second half to our customers’ schedules. of the year, our commercial businesses By December, the V-280 had flown over BELL REVEALS NEW EDAT SYSTEM have generally experienced an increase in 200 hours through more than 150 test customer demand compared with the first flights as part of a rigorous flight test half of 2020. Building on this momentum, program. Throughout the program, the we delivered strong fourth quarter results team has worked closely with the Army MARCH and look to carry this into 2021. to demonstrate the V-280 is a low-risk, Our revenues for the year were $11.7 affordable and sustainable aircraft that billion. We recorded a segment profit of will redefine the battlefield for decades $751 million with a profit margin of 6.4 to come. As part of the test program, percent. Through a focus on working multiple Army Experimental Test Pilots capital management and cost control, have flown the V-280 and soldier our manufacturing businesses generated touchpoint events have enabled pilots, $833 million of net cash from operating maintainers and infantry soldiers to share activities of continuing operations. their input. The Army’s down-select of the Invictus INVESTMENTS LEAD TO followed almost one year of design NEW OPPORTUNITIES WITH and risk-reduction work by the Bell MILITARY CUSTOMERS team as part of the initial contract phase. TWO FUTURE VERTICAL LIFT Despite the pandemic, our prior Like the V-280, the Invictus design PROGRAM MILESTONES: BELL investments in our new products and V-280 VALOR (TOP) AND BELL combines innovation with tested 360 INVICTUS (BOTTOM) DOWN- technologies at our defense businesses technologies to fulfill the customer’s SELECTED FOR ARMY’S FLRAA AND FARA PROGRAMS, RESPECTIVELY enabled us to move forward on a requirements at an affordable cost that number of military programs and win meets the Army’s schedule. new contract awards in 2020. 2 TEXTRON 2020 ANNUAL REPORT In late 2020, the Department of Defense Demonstrating its confidence in Textron awarded Bell Boeing a contract that Systems’ Ship-to-Shore Connector includes recurring procurement of kits program, the U.S. Navy awarded and installs for nacelle improvements a follow-on production contract for APRIL onto the CV-22 aircraft for the Air Force. additional SSC craft. This brings the These modifications to the nacelles current number of SSC craft being will improve maintainability, reduce produced by Textron Systems to 24. maintenance man-hours and improve The SSC program marked a significant readiness rates. milestone with the fly-away of the first two SSC craft from Systems’ New Bell also reached delivery milestones with Orleans shipyard to the Naval Surface its H-1 and V-22 programs. In May, Warfare Center in Florida. U.S. NAVY AWARDS TEXTRON Bell successfully delivered the 150th Bell SYSTEMS A FOLLOW-ON PRODUCTION AH-1Z helicopter and the 100th Zulu Textron Systems’ ATAC business won CONTRACT TO PRODUCE ADDITIONAL SHIP-TO-SHORE CONNECTOR CRAFT Build New manufactured at our Fort four contract awards as part of the U.S. Worth and Amarillo facilities. Bell also Air Force’s Combat Air Forces (CAF) delivered its 400th V-22—this milestone Contracted Air Support (CAS) program. MAY was a CV-22 aircraft to the U.S. Special With these contracts, ATAC will use its Operations Command—as well as fleet of fighter aircraft for adversary air the first CMV-22B variant designed and close air support live training for specifically for carrier fleet operations for the Air Force as well as the U.S. Special the U.S. Navy. Japan became the first Operations Command. ATAC also international operator of a V-22 when the received an award to support the Navy U.S. government delivered the tiltrotor to and Marine Corps, under the Fighter CESSNA SKYCOURIER MAKES FIRST Camp Kisarazu that will be operated by Jet Services (FJS) program. ATAC has FLIGHT the Japan Ground Self Defense Force. been steadily building its fleet of Mirage F1, F-21 Kfir and MK-58 Hawker Hunter With its innovative products and fighter aircraft to position itself for these JUNE technologies and through partnerships strategic wins. with our military customers, Textron Systems won a number of new contracts during the year. TOTAL REVENUE TOTAL REVENUE TOTAL REVENUE BY SEGMENT BY TYPE BY REGION BELL DELIVERS FIRST CMV-22B FOR FLEET OPERATIONS TO THE NAVY Textron Aviation 34% Commercial 70% U.S. 68% Bell 28% U.S. Government 30% Europe 11% Industrial 26% Asia and Australia 10% Textron Systems 11% Other 11% Finance 1% TEXTRON 2020 ANNUAL REPORT 3 Textron Systems was also awarded a Bell completed several key certification contract to support work on the U.S. activities with the Bell 525 Relentless Air Force’s Ground Based Strategic as it moves closer to becoming the Deterrent (GBSD) missile system, under first certified commercial fly-by-wire prime contractor Northrop Grumman.