Textron

SELECTED FINANCIAL STATISTICS 2017-2013

(Dollars in millions, except where noted and per share amounts)	2017	2016	2015	2014	2013
Income Statement Data
Revenues	$14,198	$13,788	$13,423	$13,878	$12,104
Segment profit	1,169	1,309	1,255	1,214	963
Corporate expenses and other, net	(132)	(172)	(154)	(161)	(166)
Interest expense, net for Manufacturing group	(145)	(138)	(130)	(148)	(123)
Special charges	(130)	(123)	—	(52)	—
Income tax expense	(456)	(33)	(273)	(248)	(176)
Effective tax rate	59.8%	3.8%	28.1%	29.1%	26.1%

Income from continuing operations	$306	$843	$698	$605	$498

Diluted EPS from continuing operations	$1.14	$3.09	$2.50	$2.15	$1.75

Balance Sheet Data—Manufacturing Group
Cash and equivalents	$1,079	$1,137	$946	$731	$1,163
Accounts receivable, net	1,363	1,064	1,047	1,035	979
Inventories	4,150	4,464	4,144	3,928	2,963
Property, plant and equipment, net	2,721	2,581	2,492	2,497	2,215
Goodwill	2,364	2,113	2,023	2,027	1,735
Total assets	14,171	14,078	13,392	13,076	11,219
Total debt	3,088	2,777	2,697	2,811	1,931
Total liabilities	8,740	8,661	8,603	9,028	7,044
Total Company shareholders' equity	5,647	5,574	4,964	4,272	4,384

Non-GAAP Cash Flow Calculations—Manufacturing Group
Net cash from operating activities of continuing operations—GAAP	$947	$988	$1,038	$1,097	$658
Less: Capital expenditures	(423)	(446)	(420)	(429)	(444)
Dividends received from TFC	—	(29)	(63)	—	(175)
Plus: Total pension contributions	358	50	68	76	194
Proceeds from sale of property, plant and equipment	7	10	8	9	22
Capital contributions paid to TFC	—	—	—	—	1

Manufacturing cash flow before pension contributions—Non-GAAP¹	$889	$573	$631	$753	$256

Cash Flow Items—Manufacturing Group
Depreciation and amortization	$435	$437	$449	$446	$371
Net cash used in acquisitions	(331)	(186)	(81)	(1,628)	(196)
Net change in debt	288	91	(100)	880	(321)
Dividends paid	(21)	(22)	(22)	(28)	(22)
Purchases of Textron common stock	(582)	(241)	(219)	(340)	—
Total number of shares purchased (in thousands)	11,918	6,898	5,197	8,921	—

Key Ratios
Segment profit margin	8.2%	9.5%	9.3%	8.7%	8.0%
Selling and administrative expense as % of sales	9.4%	9.5%	9.7%	9.8%	9.3%
Inventory turns (based on FIFO)	2.4x	2.3x	2.4x	2.7x	2.6x
Ratio of income to fixed charges—Manufacturing group	4.98x	5.92x	7.05x	5.43x	6.23x
Debt-to-capital (net of cash)—Manufacturing group	26%	23%	26%	33%	15%

Stock-Related Information
Stock price at year-end	$56.59	$48.56	$42.01	$42.17	$36.61
Dividend payout ratio	7%	3%	3%	4%	5%
Dividends declared per share	$0.08	$0.08	$0.08	$0.08	$0.08

Other Statistics
Number of employees at year-end	37,000	36,000	35,000	34,000	32,000
Average revenues per employee (in thousands)	384	383	384	408	378

We use Manufacturing Cash Flow Before Pension Contributions as our measure of free cash flow. This measure is not a financial measure under generally accepted accounting principles (GAAP) and should be used in conjunction with GAAP cash measures provided in our Consolidated Statements of Cash Flows. Our definition of 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.