Adjusted Income from Continuing Operations—Non-GAAP1
715
658
PER SHARE OF COMMON STOCK
Common Stock Price:
High
$ 49.82
$ 57.71
Low
30.69
43.66
Year-End
48.56
56.59
Diluted Earnings from Continuing Operations—GAAP
3.09
1.14
Adjusted Diluted Earnings from Continuing Operations—Non-GAAP1
2.62
2.45
COMMON SHARES OUTSTANDING (In Thousands)
Diluted Average
272,365
268,750
Year-End
270,287
261,471
FINANCIAL POSITION
Total Assets
$15,358
$15,340
Manufacturing Group Debt
2,777
3,088
Finance Group Debt
903
824
Shareholders’ Equity
5,574
5,647
Manufacturing Group Debt-to-Capital (Net of Cash)
23%
26%
Manufacturing Group Debt-to-Capital
33%
35%
KEY PERFORMANCE METRIC
Net Cash Provided by Operating Activities of Continuing Operations for Manufacturing Group—GAAP
$ 988
$ 947
Manufacturing Cash Flow Before Pension Contributions—Non-GAAP1
573
889
Adjusted Income from Continuing Operations, Adjusted Diluted Earnings Per Share from Continuing Operations and Manufacturing Cash Flow Before Pension Contributions are Non-GAAP Measures.
FOOTNOTE TO SELECTED YEAR-OVER-YEAR FINANCIAL DATA
Adjusted Income from Continuing Operations and Adjusted Diluted Earnings Per Share from Continuing Operations
Adjusted income from continuing operations and adjusted diluted earnings per share from continuing operations both exclude special charges, net of income taxes, the income tax impact from the enactment of the Tax Cuts and Jobs Act (the “Act”) and a significant multi-year income tax settlement. We consider items recorded in special charges, net of income taxes, such as enterprise-wide restructuring and acquisition-related restructuring, integration and transaction costs, to be of a non-recurrig nature that is not indicative of ongoing operations. In addition, both the impact from the Act and the income tax settlement are not considered to be indicative of ongoing operations, since they represent significant one-time adjustments.
(Dollars in Millions, Except Per Share Amounts)
2016
2017
Income from Continuing Operations—GAAP
$843
$306
Restructuring, net of taxes
78
59
Arctic Cat restructuring, integration and transaction costs, net of taxes
—
27
Total special charges, net of taxes
78
86
Income tax expense resulting from the Tax Cuts and Jobs Act
—
266
Income tax settlement
(206)
—
Adjusted Income from Continuing Operations—Non-GAAP
$ 715
$ 658
Diluted Earnings Per Share:
Income from Continuing Operations—GAAP
$3.09
$1.14
Restructuring, net of taxes
0.29
0.22
Arctic Cat restructuring, integration and transaction costs, net of taxes
—
0.10
Total special charges, net of taxes
0.29
0.32
Income tax expense resulting from the Tax Cuts and Jobs Act
—
0.99
Income tax settlement
(0.76)
—
Adjusted Income from Continuing Operations—Non-GAAP
$2.62
$2.45
Manufacturing Cash Flow Before Pension Contributions
Manufacturing cash flow before pension contributions adjusts net cash from operating activities of continuing operations (GAAP) for the following:
Excludes dividends received from Textron Financial Corporation (TFC) and capital contributions to TFC provided under the Support Agreement and debt agreements as these cash flows are not representative of manufacturing operations;
Deducts capital expenditures and includes proceeds from the sale of property, plant and equipment to arrive at the net capital investment required to support ongoing manufacturing operations;
Adds back pension contributions as we consider our pension obligations to be debt-like liabilities. Additionally, these contributions can fluctuate significantly from period to period and we believe that they are not representative of cash used by our manufacturing operations during the period.
While we believe this measure provides a focus on cash generated from manufacturing operations, before pension contributions, and may be used as an additional relevant measure of liquidity, it does not necessarily provide the amount available for discretionary expenditures since we have certain non-discretionary obligations that are not deducted from the measure.
(In Millions)
2016
2017
Net Cash Provided By Operating Activities of Continuing Operations—GAAP
$ 988
$ 947
Less: Capital expenditures
(446)
(423)
Dividends received from TFC
(29)
—
Plus: Total pension contributions
50
358
Proceeds from the sale of property, plant and equipment
10
7
Manufacturing Cash Flow Before Pension Contributions—Non-GAAP