Second quarter sales increase 7% Cash provided by operating activities for the first six months of fiscal 2015 improves 69% CEDAR RAPIDS, Iowa (April 23, 2015) - Rockwell Collins, Inc. (NYSE: COL) today reported second quarter fiscal year 2015 [...]
Second quarter sales increase 7%
Cash provided by operating activities for the first six months of
fiscal 2015 improves 69%
CEDAR RAPIDS, Iowa (April 23, 2015) - Rockwell Collins, Inc.
today reported second quarter fiscal year 2015 earnings per share from
continuing operations increased 13% to $1. 22 compared to $1. 08 in the prior
year. Total sales for the second quarter of fiscal year 2015 were $1.
billion, a 7% increase from the same period in fiscal year 2014. Cash
provided by operating activities for the first six months of fiscal 2015 totaled
$132 million, an increase of $54 million compared to the $78 million reported
for the first six months last year.
"Our performance in the first half of fiscal 2015 is underscored by another
quarter of double digit EPS growth driven by organic sales and earnings growth
across all of our businesses," said Rockwell Collins Chief Executive Officer and
President, Kelly Ortberg.
"Our plan for the year is playing out about as we
expected, with air transport OEM sales and aviation connectivity sales
continuing to pace our top-line revenue growth. We're also seeing
stabilization in U. S.
DoD programs and business jet production.
result, I continue to believe we are well positioned to deliver double-digit
earnings per share and cash flow growth for fiscal year 2015. "
Following is a discussion of fiscal year 2015 second quarter sales and
earnings for each business segment.
Commercial Systems, which provides aviation electronics systems, products and
services to air transport, business and regional aircraft manufacturers and
airlines worldwide, achieved 2015 second quarter results as summarized below.
Original equipment sales increased due to improved share of airline
selectable equipment, higher customer funded development program sales, and
higher OEM production rates.
Aftermarket sales increased primarily due to higher service and support
revenues, increased sales of used aircraft parts, and higher regulatory
Operating earnings increased due to incremental earnings on higher sales
Government Systems provides a broad range of electronic products, systems and
services to customers including the U. S.
Department of Defense, other government
agencies, civil agencies, defense contractors and ministries of defense around
the world. Results from the second quarter of 2015 are summarized below.
Avionics sales increased due to higher hardware deliveries for rotary
wing aircraft, higher KC-10 retrofit sales, and higher Joint Strike Fighter
simulation and training sales.
These increases were partially offset
by lower KC-46 development program sales and the foreign currency impact of
a stronger U. S. dollar.
Communication product sales decreased due to lower deliveries of
Joint Tactical Radio System Manpack radios partially offset by higher data
link development sales.
Surface solutions sales decreased due to lower development sales for the
Common Range Integrated Instrumentation System program.
Operating earnings increased due to incremental earnings on higher sales
volume, partially offset by higher investment in company-funded R&D expense.
Information Management Services
Information Management Services (IMS) enables mission-critical data and voice
communications throughout the world to customers including the U. S. Federal
Aviation Administration (FAA), commercial airlines, business aircraft operators,
airport and critical infrastructure operators and major passenger and freight
These communications are enabled by the Company's high-performance,
high-quality and high-assurance proprietary radio and terrestrial networks,
enhancing customer efficiency, safety and connectivity. Results from the
second quarter of 2015 are summarized below.
IMS sales increased primarily due to 10 percent growth in aviation
related businesses including GLOBALinkSM and ARINCDirectSM, partially offset
by lower sales due to the exit of certain government programs.
IMS operating earnings and operating margin increased primarily
due to the higher sales volume and the absence of certain licensing costs
incurred in the prior year.
Corporate and Financial Highlights
The company's effective income tax rate was 32.
4% for the second quarter of 2015
compared to a rate of 31.
5% for the same period last year. The higher
effective income tax rate in the second quarter of 2015 was due primarily to a
favorable adjustment recorded in the second quarter of 2014 that related to the
resolution of the IRS audit for taxable years ended September 30, 2010 and 2011.
Cash provided by operating activities was $132 million for the first six months
of fiscal year 2015, compared to $78 million in the first six months of fiscal
The increase in cash provided by operating activities was due
primarily to higher earnings and lower income tax payments, partially offset by
other net working capital changes.
During the second quarter of 2015, the company repurchased 0. 7 million shares
of common stock at a total cost of $63 million.
The company also paid a dividend
on its common stock of 30 cents per share, or $40 million, in the second quarter
Fiscal Year 2015 Outlook
The following table is a summary of the company's financial guidance for
continuing operations for fiscal year 2015, which is unchanged from the guidance
previously provided on January 23, 2015:
(1) - Total research and development investment consists of company and
customer funded research & development expenditures as well as the net increase
in pre-production engineering costs capitalized within inventory.
Conference Call and Webcast Details
Rockwell Collins CEO and President, Kelly Ortberg, and Senior Vice President and
CFO, Patrick Allen, will conduct an earnings conference call at 10: 00 a. m.
Eastern Time on April 23, 2015. Individuals may listen to the call and view
management's supporting slide presentation on the Internet at
Listeners are encouraged to go to the Investor
Relations portion of the web site at least 15 minutes prior to the call to
download and install any necessary software.
The call will be available for
replay on the Internet at
www. rockwellcollins. com.
Rockwell Collins expands information management offerings with
acquisition of Pacific Avionics
Rockwell Collins acquired Pacific Avionics Pty.
Limited, a Singapore-based
company specializing in technologies used for wireless information distribution,
including inflight entertainment and connectivity.
Rockwell Collins and Bluesky sign final agreement to form ACCEL
(Tianjin) Flight Simulation Co.
Rockwell Collins and Beijing Bluesky Aviation Technology, an AVIC subsidiary,
signed a final agreement to establish ACCEL (Tianjin) Flight Simulation Co. LTD.
Joint Venture (JV). The JV, with equal shares owned by the two entities,
will create a simulation and training center of excellence in China for
commercial flight simulation and training solutions.
Rockwell Collins teams with OneWeb to provide unprecedented
connectivity to aviation
Rockwell Collins signed a memorandum of understanding with OneWeb Ltd.
to be the
exclusive developer and provider of satellite communication terminals for
OneWeb's global aviation high-speed broadband service. Rockwell Collins will
also be an authorized value added reseller of OneWeb connectivity services.
Rockwell Collins unveils ground-breaking approach to military
communications with launch of TruNet™ networked communications solution
For years, the U.
S. armed forces and militaries around the world have sought an
interoperable, scalable, ad-hoc networked communications system that allows
warfighters to talk with each other, no matter if they are located on the ground
or in the air. Now Rockwell Collins has cracked that code with its TruNet
networked communications solution – offering a one-stop, integrated ground-air
Rockwell Collins to produce SATCOM terminals for Iridium CertusSM broadband
Rockwell Collins entered into an agreement with Iridium Communications Inc.
be a value-added manufacturer for Iridium Certus broadband terminals. As a
VAM, Rockwell Collins will design and manufacture the terminals, which will
enable users to utilize Iridium Certus, the voice and data service enabled by
the Iridium NEXT satellite constellation.
Rockwell Collins avionics selected by the following airlines:
India-based airline, IndiGo, selected Rockwell
Collins' advanced avionics systems, including its MultiScan ThreatTrack™ weather
radar and Multi-Mode Receiver, for 30 Airbus A320neo (new engine option)
China Eastern selected Rockwell Collins'
advanced avionics systems, including its Head-up Guidance System and Multi-Mode
Receiver, for 20 new Next-Generation Boeing 737 aircraft.
Rockwell Collins' PAVES™ Broadcast in-flight
entertainment and Airshow® 3D Moving Map systems will be featured on 45
Next-Generation Boeing 737 aircraft on order by China-based Xiamen Airlines and
its subsidiary, Hebei Airlines.
China-based Hainan Airlines selected Rockwell
Collins' Head-up Guidance System for an undisclosed number of new and in-service
Next-Generation Boeing 737 aircraft and flight simulators to improve safety and
Star Air to upgrade Boeing 767 fleet with Rockwell Collins' large-format flight
Rockwell Collins' large-format flight displays, inspired by the same display
system found on Boeing 787 Dreamliner airplanes, was selected by Denmark-based
Star Air for its fleet of 11 Boeing 767-200BDSF cargo airplanes.
Rockwell Collins brings innovative avionics to Bristow Helicopters for U.
search and rescue program
Rockwell Collins' newest technologies for helicopters will be playing a key role
in advancing search and rescue services being provided by Bristow Helicopters
Ltd on behalf of the Maritime and Coastguard Agency for the UK's search and
rescue (SAR) program, commencing in April. Rockwell Collins' flight decks
are featured on the new fleet of specially commissioned SAR aircraft, including
11 Sikorsky S-92s and 11 AW189 helicopters.
Zen Technologies and Rockwell Collins Launch into India's Military Flight
Simulation Market Segment
Zen Technologies and Rockwell Collins announced their decision to join forces in
military flight simulation by unveiling a next generation rotary wing simulator
at Aero India 2015.
The two industry leaders recently signed a memorandum of
understanding to combine their strengths in simulation and training to offer
advanced and high fidelity aviation training solutions.
Rockwell Collins to provide Joint Fires Observer/Joint Terminal Attack
Controller simulator to Australian Army
Rockwell Collins will provide the Australian Army with the latest generation
Joint Fires Observer /Joint Terminal Attack Controller simulator that is
designed to meet all of the service's training requirements now and into the
Rockwell Collins collaborates with AMMROC for military avionics MRO alliance
Rockwell Collins and Advanced Military Maintenance Repair and Overhaul Center
(AMMROC) LLC, an Abu Dhabi-based company, have agreed in principle to form a
strategic alliance that will provide maintenance, repair and overhaul services
for military avionics.
Target markets include the UAE and countries in the South
Asia, Middle East and North Africa region.
Rockwell Collins delivers RNP-RNAV capabilities for U. S.
Army CH-47F Chinooks
The U. S. Army continues to bring additional levels of safety to CH-47F operators
with a new Required Navigation Performance-Area Navigation (RNP-RNAV) upgrade
from Rockwell Collins.
Rockwell Collins to provide secure GPS receivers for Harris Corporation tactical
Rockwell Collins signed a contract to provide its MicroGRAM GPS receivers for
Harris Corporation's tactical radios, bringing secure, jam-resistant GPS
capability to products such as the Falcon III AN/PRC-158 and AN/PRC-117G.
Rockwell Collins completes sale of ARINC Aerospace Systems Engineering and
Support to Field Aviation Inc.
Rockwell Collins completed the sale of ARINC Aerospace Systems Engineering and
Support to Field Aviation Inc.
, a privately held U. S. company.
Rockwell Collins introduces ARINC MultiLinkSM flight tracking service
Rockwell Collins unveiled its ARINC MultiLinkSM flight tracking service,
offering a comprehensive and cost-effective global flight tracking solution for
the world's airlines.
ARINC MultiLink brings together multiple data
sources to reliably report the location of an aircraft anywhere in the world.
Rockwell Collins launches live credit card authorization service on Hong Kong
Hong Kong Airlines (HKA) is the launch airline for a new service from Rockwell
Collins that enables the airline to conduct live credit card authorizations
using Wi-Fi® over its existing ARINC ACARS infrastructure.
The service, which is
the first of its kind in the industry, is offered through a strategic agreement
with the DFASS Group. With this service, HKA will be able to process credit card
authorizations in real time, eliminating loss due to credit card fraud.
Federal Aviation Administration awards oceanic data link services contract to
Rockwell Collins has been awarded a seven year contract with the Federal
Aviation Administration to provide the company's oceanic data link service to
enable real-time, data communications between pilots and air traffic
controllers, allowing aircraft to fly more efficient routes to save fuel and
About Rockwell Collins
Rockwell Collins is a pioneer in the development and deployment of innovative
communication and aviation electronic solutions for both commercial and
government applications. Our expertise in flight deck avionics, cabin
electronics, mission communications, simulation and training and information
management services is delivered by a global workforce, and a service and
support network that crosses more than 150 countries. To find out more, please
This press release contains statements, including
certain projections and business trends, that are forward-looking statements as
defined in the Private Securities Litigation Reform Act of 1995.
may differ materially from those projected as a result of certain risks and
uncertainties, including but not limited to the financial condition of our
customers, including bankruptcies; the health of the global economy, including
potential deterioration in economic and financial market conditions; adjustments
to the commercial OEM production rates and the aftermarket; the impacts of
natural disasters and pandemics, including operational disruption, potential
supply shortages and other economic impacts; cybersecurity threats, including
the potential misappropriation of assets or sensitive information, corruption of
data or operational disruption; delays related to the award of domestic and
international contracts; delays in customer programs; unanticipated impacts of
sequestration and other provisions of the Budget Control Act of 2011 as modified
by the Bipartisan Budget Act of 2013; the continued support for military
transformation and modernization programs; potential impact of volatility in oil
prices, currency exchange rates or interest rates on the commercial aerospace
industry or our business; the impact of terrorist events on the commercial
aerospace industry; declining defense budgets resulting from budget deficits in
the U. S. and abroad; changes in domestic and foreign government spending,
budgetary, procurement and trade policies adverse to our businesses; market
acceptance of our new and existing technologies, products and services;
reliability of and customer satisfaction with our products and services;
potential unavailability of our mission-critical data and voice communication
networks; favorable outcomes on or potential cancellation or restructuring of
contracts, orders or program priorities by our customers; recruitment and
retention of qualified personnel; regulatory restrictions on air travel due to
environmental concerns; effective negotiation of collective bargaining
agreements by us, our customers, and our suppliers; performance of our customers
and subcontractors; risks inherent in development and fixed-price contracts,
particularly the risk of cost overruns; risk of significant reduction to air
travel or aircraft capacity beyond our forecasts; our ability to execute to
internal performance plans such as productivity and quality improvements and
cost reduction initiatives; achievement of ARINC integration and synergy plans
as well as our other acquisition and related integration plans; continuing to
maintain our planned effective tax rates; our ability to develop contract
compliant systems and products on schedule and within anticipated cost
estimates; risk of fines and penalties related to noncompliance with laws and
regulations including export control and environmental regulations; risk of
asset impairments; our ability to win new business and convert those orders to
sales within the fiscal year in accordance with our annual operating plan; and
the uncertainties of the outcome of lawsuits, claims and legal proceedings, as
well as other risks and uncertainties, including but not limited to those
detailed herein and from time to time in our Securities and Exchange Commission
These forward-looking statements are made only as of the date hereof
and the company assumes no obligation to update any forward-looking statement.