Panneer Balasbarmaniam Norma Tokunboh Cheryl Bradley Linda Hayes Friends University Professor: Dr John Murphy, Ph.

D Date: August 27,2012

Raytheon was established in Cambridge, Massachusetts on July 7, 1922 as the American Appliance Company and got its present name of Raytheon in 1959. A global technology leader in:

Defense, government and commercial electronics Business and special mission aircraft and guided missiles

Integrated Defense System

Intelligence and Information System

Network Centric Systems Missile Systems Space & Airborne Systems

Focus on key strategic pursuits, technology, and mission assurance, to sustain and grow its position in four core markets;

Sensing: Provide the breadth of sensing solutions required to meet its customers mission needs Effects: Leverage kinetic energy based expertise into electronic warfare (EW), directed energy and cyber-solutions. C3I (Command, Control, Communication and Intelligence): Broaden market presence in communications, networking and knowledge management. Mission support: Expand product support, engineering services and training.

Leverage its domain knowledge in air, land, sea, space and cyber for all markets Expand international business by building on its relationships and deep market expertise. Continue to be a customer focused company based on performance, relationships and solutions and commitment to social responsibility Deliver innovative supply chain solutions to accelerate growth, create competitive advantage and bring valued, global solutions to its customers.

Customer: Be regarded as a customer focused company based on performance, relationships and solutions. Growth: Grow revenue faster than the market, build on good performance in improving cash flow. Execute well and with predictability. People: Retain and attract world-class talent while providing superior opportunities for further individual development. Treat all employees with respect. Leverage diversity efforts as a competitive advantage, continuing Raytheons leadership in diversity Productivity: Improve ROI. Take Raytheon six sigma to next level, further engaging customers and partners. Deliver greater value and predictability through the integrated product development system (IPDS). Earned value management system (EVMS) and capability maturity model integration (CMMI).

Mission Statement

Customer success is Raytheons mission Our people and products are currently providing solutions across the LVC and C2 domains, saving lives and saving money for the war fighter Be the most admired defense and aerospace system company through Raytheons world-class people, innovation and technology.

Visions

Values

People: Treat people with respect and dignity. Welcome diversity and diverse opinions. Collaborate with fellow employees to improve skills. Recognize and reward accomplishment. Foster teamwork and collaboration Integrity: Be honest, forthright and trustworthy. Use straight talk; no hidden agendas. Respect ethics, laws and collaboration. Commitment: Honor commitments to customers, shareholders, suppliers, the community and each other. Accept personal responsibility to meet commitments; be accountable. Excellence: Improve performance continually. Achieve innovation in all areas where Raytheon does business with. Stress quality, productivity, growth, best practices and measurement. Always strive to be the best.

Innovation

Raytheons innovative, effective technologies, CMMI excellence and trusted relationships provide their customers with Mission assurance performance for their changing operational needs. Technologies are continuously updated based on customer feedback. In an effort to lower costs, companies have focused internally on identifying their core competencies, often outsourcing products that are neither strategic nor competitive from a cost standpoint. Raytheon controlled what they can control. Six Sigma initiative has been designed to improve processes and eliminate waste in an effort to manage internal cost. The company has realized significant savings from increased process efficiency. Signature MathsMovesU program has now touched lives of more than 3 millions students, teachers and parents Benchmarking: Information collected from internal, external and six sigma results Process: Develop new process based on the results of benchmarking Tools and templates: Developed for various tasks such as supplier selection, cost models etc., Pilot program: Various pilot programs were developed and tested Incorporation of lessons learned: Lesson learned database were created and being used Training: Functional, process training and customer trainings have been conducted Communication plan: Robust communication plan has been established and disseminated

Focus on core

Six sigma

Commitment to social responsibility

Achieved greater deal on project milestones

Particulars Bookings ($ millions) Backlog ($ millions) Net Sales ($ millions)

45000 40000 35000 30000 25000

2003 22693 27542 18109

2004 25700 32543 20245

2005 24828 34419 21894

2006 22417 33838 19707

2007 25498 36614 21301

2008 26820 38884 23174

2009 25058 36877 24881

2010 24449 34551 25183

2011 26555 35312 24857

Bookings ($ millions) 20000 15000 10000 5000 Backlog ($ millions) Net Sales ($ millions)

0
2003 2004 2005 2006 2007 2008 2009 2010 2011

Particulars Operating income ($ millions) Net income ($ millions) Cash flow from operations ($ millions)

2003 1313 365

2004 1388 417

2005 1687 871

2006 1944 1187

2007 2328 1474

2008 2596 1719

2009 1894 1977

2010 2077 1843

2011 2086 1897

2600

2100

2500

2477

1249

2036

2200

1900

2700

3000

2500

2000 Operating income ($ millions)

1500

Net income ($ millions) Cash flow from operations ($ millions)

1000

500

0
2003 2004 2005 2006 2007 2008 2009 2010 2011

Particulars

2003

2004

2005

2006

2007

2008

2009

2010

2011

EPS ($) Dividend per share ($)

1.29
0.8

0.99
0.8

2.08
0.88

2.63
0.96

3.31
1.02

4.06
1.12

4.79
1.24

5.51
1.5

5.90
1.72

6.50 6.00 5.50 5.00 4.50 4.00 3.50 3.00 2.50 2.00 1.50 1.00 0.50 0.00 2003 2004 2005 2006 2007 2008 2009 2010 2011 EPS Dividend per share

Particulars

2003

2004

2005

2006

2007

2008

2009

2010

2011

ROI Total Debt to Equity Ratio

2.21%
80.67%

2.67%
48.02%

5.75%
41.38%

7.88%
35.72%

9.95%
18.08%

15.08%
25.41%

16.13%
23.45%

13.65%
36.50%

14.65%
55.22%

90.00% 80.00% 70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00% 2003 2004 2005 2006 2007 2008 2009 2010 2011

ROI Total Debt to Equity Ratio

Company/index 12/31/2003 Raytheon stock S&P 500 Index S&P Aerospace &Defense index
250 200 150

12/31/2004 132.20 110.88 116.00

12/31/2005 139.80 116.32 134.47

12/31/2006 187.57 134.69 168.30

12/31/2007 219.50 142.09 200.81

12/31/2008 188.34 89.53 127.45

12/31/2009 195.15 113.21 158.84

12/31/2010 179.54 130.26 182.84

12/31/2011 195.95 133.01 192.48

100 100 100

Raytheon stock S&P 500 Index S&P Aerospace &Defense index

100 50

0
1/1/2003 1/1/2004 1/1/2005 1/1/2006 1/1/2007 1/1/2008 1/1/2009 1/1/2010 1/1/2011

In 2011 Raytheon once again delivered solid operating results. We capitalized on global market opportunities and successfully managed the challenges of an evolving economic environment both domestically and internationally. Focused on the things that we could control and what we do best. We executed our strategy. We continued to implement efficiencies across the businesses, lowering our costs. We provided more affordable, innovative solutions to our customers. Our solid results speak to the execution of our strategy. With some 8,000 programs and more than 15,000 contracts, Raytheon is well positioned with a portfolio of depth and breadth spanning the five interconnected domains of air, land, sea, space and cyberspace. Raytheons commitment to CSR is stronger than ever. We enhanced our international governance and compliance program which provided 29% of bookings for 2011 from 81 countries. Our Vision, Strategy, Goals and Values: consistent and Proven William H. Swanson Chairman and CEO March 2012

Adjusted EPS of $1.55 up 13%; EPS from continuing operation was $1.41, up 18% Adjusted operating margin of 13.6%, reported operating margin of 12.4% Booking of $6.2 billion; net sales of 6.0 billion Increased full year 2012 guidance for EPS and operating cash flow from continuing operations.

Retrieved from http://investor.raytheon.com/phoenix.zhtml?c= 84193&p=irol-irhome Retrieved from Raytheon. (2012). Retrieved August 15, 2012, from Raytheon: http://www.raytheon.com/ourcompany/vsgv/