1
[BFGOODRICH LOGO]
Exhibit 99.1
BFGOODRICH COMPANY NEWS
Four Coliseum Centre PR01-008
2730 West Tyvola Road CONTACT: Kevin Ramundo
Charlotte, North Carolina 28217-4578 PHONE: 704/ 423-7024
www.bfgoodrich.com
INVESTOR CONTACT: Paul Gifford
PHONE: 704-423-5517
FOR IMMEDIATE RELEASE
BFGOODRICH REPORTS STRONG FOURTH-QUARTER RESULTS AND SIXTH CONSECUTIVE YEAR OF
SALES AND EARNINGS GROWTH
- Q4 EARNINGS FROM CONTINUING OPERATIONS* UP 19 PERCENT FROM $0.67 TO
$0.80 PER SHARE, AND REACH $2.97 FOR FULL YEAR, EXCEEDING CONSENSUS
ESTIMATES
- DOUBLE-DIGIT EARNINGS GROWTH ANTICIPATED IN 2001
*EXCLUDES SPECIAL ITEMS
CHARLOTTE, NC, January 29, 2001 - The BFGoodrich Company (NYSE: GR) announced
today that fourth-quarter net income from continuing operations, excluding
special items, was $84.1 million, or $0.80 per share, compared to year-ago
results of $74.7 million, or $0.67 per share. For the full year, net income from
continuing operations, excluding special items, rose to $317.5 million, or $2.97
per share, compared to $305.9 million, or $2.75 per share, in 1999. Sales for
the quarter and the full year were $1.1 billion and $4.4 billion, respectively.
These results exclude the Performance Materials segment, which is being
divested. First Call consensus excluding this segment equals $0.74 per share and
$2.91 per share for the fourth quarter and full year, respectively.
The results include a change in the company's effective tax rate for continuing
operations from 35.5 percent to 34 percent with the fourth quarter and the
full-year favorable impact included in the quarter's results. The fourth quarter
also includes an after-tax charge of $2.7 million, or $.02 per share, due to the
impact of the National Airlines' Chapter 11 bankruptcy filing on BFGoodrich's
Aerostructures and Aviation Services Group.
Commenting on the quarter's results, David L. Burner, BFGoodrich's chairman and
chief executive officer, said, "Our Aerospace segment again achieved excellent
results compared to the year-ago quarter including double-digit operating income
growth and nearly 10 percent revenue growth even though commercial transport
deliveries were lower. All four operating groups in this segment achieved higher
sales and three reported significantly higher operating income growth. Our
Engineered Industrial Products segment also reported higher fourth-quarter sales
and a substantial increase in operating income."
Regarding 2000, Burner added, "For the sixth consecutive year, BFGoodrich
achieved record earnings, excluding special charges. Free cash flow excluding
special items exceeded expectations, equaling $244 million including Performance
Materials and $161 million without this segment. We are also pleased that our
shareholders realized a total return of 36.5 percent for the year 2000, when the
S&P 500 and Dow Jones indices were down."
Page 1 of 4 PR01-008 BFGoodrich Reports Strong Fourth-Quarter Results and Sixth
Consecutive Year of Sales and Earnings Growth
2
[BFGOODRICH LOGO] NEWS
Including Performance Materials, fourth-quarter income before special charges
equaled $91.0 million, or $0.87 per share, and $357.0 million, or $3.33 per
share, for the year. The First Call consensus on this basis for the fourth
quarter and the year were $0.83 per share and $3.30 per share, respectively.
On an after-tax basis, the company incurred net special charges of $12.8 million
in the fourth quarter and $31.2 million for the year, largely related to costs
associated with merger and consolidation activities. After these special
charges, the company reported earnings per share of $0.75 for the fourth quarter
and $3.04 for the full year. The fourth quarter charge included various
consolidation activities in the Engineered Industrial Products segment as
described in the highlights section of this release.
FOURTH QUARTER CONTINUING OPERATIONS SEGMENT REVIEW
- ---------------------------------------------------
In Aerospace, sales increased nearly 10 percent to $954.4 million, operating
income increased 12 percent to $157.1 million, and margins rose to 16.5 percent
from 16.1 percent. These excellent results reflect increased demand in regional,
business and military original equipment segments of the industry and the
company's growing position in aftermarket products and services. Landing
Systems, Electronic Systems, and Engine and Safety Systems all achieved
operating income growth in excess of 20 percent. The Aerostructures and Aviation
Services Group reported higher sales; however, operating income was lower
compared to last year's fourth quarter based on results in Aviation Services and
the impact of the National Airlines' Chapter 11 bankruptcy filing. Excluding the
bankruptcy impact and a gain in the year-ago results from a land sale, the
Aerostructures and Aviation Services Group achieved higher operating income
versus the year-ago quarter.
In Engineered Industrial Products, sales increased 2 percent to $163.0 million,
and operating income increased 42 percent to $26.9 million, compared to the
year-ago quarter when market conditions were softer, and research and
development costs related to a new engine program were significant. In the
current quarter, the three largest units in the segment, Garlock Sealing
Technologies, Fairbanks Morse Engine and Quincy Compressor, all achieved higher
profits. Operational efficiency improvement and cost reduction helped offset the
negative impact of weakness in automotive and truck and trailer markets and less
favorable foreign exchange rates.
FOURTH QUARTER HIGHLIGHTS
- -------------------------
During the quarter, BFGoodrich continued to develop new business and drive
profitable growth. The company completed two acquisitions, the largest involving
Raytheon Optical Systems, which will strengthen the opportunities for the space
flight systems business to continue its dramatic growth. Joint ventures were
announced with Boeing, SIA Engineering and Rockwell Collins to extend the
company's position in aftermarket products and services. The company completed
its equity investment in MyAircraft.com. In new program wins, the company was
selected to supply wheels and carbon brakes for the latest model of the F-16;
ejection seats for Lockheed Martin and the United States Air Force; avionics
equipment for the Gulfstream V-SP and Cessna Sovereign aircraft; and landing
gear for American Airlines' Fokker F-100 retrofit program. The company also
signed a significant life-of-the-aircraft customer and product support agreement
with Pratt & Whitney for a variety of aerostructure products and services for
several aircraft models.
Page 2 of 4 PR01-008 BFGoodrich Reports Strong Fourth-Quarter Results and Sixth
Consecutive Year of Sales and Earnings Growth
3
[BFGOODRICH LOGO] NEWS
In the Engineered Industrial Products segment, new contracts were signed for
washing machine seals with Whirlpool, for axle seals and maintenance-free
bearings with several large trucking firms, and for seven new engines with the
South Florida Water Management Authority. In addition, consolidations involving
three manufacturing locations and several warehouses were announced to improve
efficiency and customer service in the Garlock Sealing and Delavan Spray
divisions.
FULL YEAR CONTINUING OPERATIONS SEGMENT REVIEW
- ----------------------------------------------
In 2000, the Aerospace segment had operating income of $591.8 million, an
increase of 6 percent from $558.7 million in 1999 on slightly higher sales of
$3.7 billion. Strong performance in Electronics Systems and Engine and Safety
Systems together with high demand for aftermarket products and services offset
the impact of lower commercial aircraft deliveries.
The Engineered Industrial Products segment had operating income of $122.1
million, an increase of 3 percent from $118.2 million in 1999. Sales were $690.2
million compared to $702.4 million in 1999, largely due to lower revenues at
Fairbanks Morse due to a change in engine programs. The increase in operating
income reflects improved operational performance, partially offset by the impact
of foreign exchange rates. Operating margins increased from 16.8 percent to 17.7
percent in 2000.
OUTLOOK
- -------
The company expects that 2001 will be another year of sales and profit growth
driven by the strength of the Aerospace segment. Higher expected deliveries of
commercial transport aircraft, coupled with the company's increasingly strong
presence in the aftermarket and in regional and business aircraft markets should
generate record Aerospace results again in 2001. Engineered Industrial Products
should experience modest top-line growth due to increased shipments of engines
and compressors and the introduction of new products, offset by weakness in
automotive, truck and trailer, and general industrial markets. Higher new
product development costs will contribute to relatively flat operating income in
this segment. Overall, the company expects a strong operating margin performance
in 2001; however, increased investments in new products that will drive
profitable growth in the future may lead to slightly lower margins compared to
2000.
In light of this outlook and assuming that the proceeds from the sale of
Performance Materials are used for debt repayment and share repurchases,
BFGoodrich anticipates that it could earn between $3.40 and $3.50 per share from
continuing operations, excluding special items in 2001. Compared to $2.97 per
share in 2000, the year-over-year increase would be between 14 and 18 percent.
If the proceeds are used differently, or the timing of the closing were to
change, the earnings outlook will change.
In commenting on the company's outlook, David Burner said, "We expect to
continue our track record of strong financial performance as a leading aerospace
and industrial company. Creating value for our shareholders through consistent
sales and profitable growth remains our primary focus."
Page 3 of 4 PR01-008 BFGoodrich Reports Strong Fourth-Quarter Results and Sixth
Consecutive Year of Sales and Earnings Growth
4
[BFGOODRICH LOGO] NEWS
PERFORMANCE MATERIALS
- ---------------------
As previously announced, BFGoodrich has entered into a definitive agreement to
sell its Performance Materials business to an investor group led by AEA
Investors Inc., and including affiliates of DLJ Merchant Banking Partners and DB
Capital Partners, Inc. The purchase price is approximately $1.4 billion, subject
to adjustment at closing. As a result, the company began reporting this segment
as a discontinued operation for the quarter and the full year. The closing of
the transaction, which is scheduled to occur during the first quarter, is
subject to a number of conditions including the ability of the buyer to obtain
financing in the debt markets on a best-efforts basis.
In the fourth quarter of 2000, the business generated net income, excluding
special items, of $6.9 million, which compares to $11.0 million in the fourth
quarter of 1999. For the total year, excluding special charges, the business
generated net income of $39.5 million, as compared to $55.8 million in 1999.
Special charges in 1999 were $0.9 million in the fourth quarter and $24.9
million for the year. The decline in results for the quarter and year was
primarily attributable to weak conditions in the textile markets, higher raw
material costs, the weak Euro, and increased interest expense.
The BFGoodrich Company, headquartered in Charlotte, North Carolina, has leading
market positions in advanced aerospace systems and engineered industrial
products. The company has $4.4 billion in annual revenues and 24,000 employees
worldwide.
The tables that follow provide more detailed information about BFGoodrich
results for the fourth quarter and full year 2000 and 1999.
[Part of this announcement contains forward-looking statements that involve
risks and uncertainties, and actual results could differ materially from those
projected in the forward-looking statements. The risks and uncertainties are
detailed from time to time in reports filed with the Securities and Exchange
Commission, including but not limited to the last section of the Management's
Discussion and Analysis entitled "Forward-Looking Information is Subject to Risk
and Uncertainty" contained in the company's Annual Report on Form 10-K, and in
other filings.]
###
Page 4 of 4 PR01-008 BFGoodrich Reports Strong Fourth-Quarter Results and Sixth
Consecutive Year of Sales and Earnings Growth
5
THE BFGOODRICH COMPANY
(Dollars in millions except per share amounts)
Three Months Ended
December 31
---------------------------------------------------------
2000 2000 1999 1999
As Reported As Adjusted(A) As Reported As Adjusted(B)
Sales $ 1,117.4 $ 1,117.4 $ 1,029.8 $ 1,029.8
========= ========= ========= =========
Income before Income Taxes
and Trust Distributions 106.7 125.7 94.6 121.6
Income Tax Expense (30.8) (37.0) (33.8) (42.3)
Distributions on Trust Preferred
Securities (4.6) (4.6) (4.6) (4.6)
--------- --------- --------- ---------
Income from Continuing Operations 71.3 84.1 56.2 74.7
Income from Discontinued Operations 6.9 -- 10.1 --
--------- --------- --------- ---------
Net Income $ 78.2 $ 84.1 $ 66.3 $ 74.7
========= ========= ========= =========
Income Per Share:
Basic
Continuing Operations $ 0.70 $ 0.82 $ 0.51 $ 0.68
Discontinued Operations 0.07 -- 0.09 --
--------- --------- --------- ---------
Net Income $ 0.77 $ 0.82 $ 0.60 $ 0.68
========= ========= ========= =========
Diluted
Continuing Operations $ 0.68 $ 0.80 $ 0.51 $ 0.67
Discontinued Operations 0.07 -- 0.09 --
--------- --------- --------- ---------
Net Income $ 0.75 $ 0.80 $ 0.60 $ 0.67
========= ========= ========= =========
Weighted - Average Number
of Shares Outstanding
(in millions):
Basic 102.1 102.1 110.2 110.2
========= ========= ========= =========
Diluted 106.7 106.7 113.3 113.3
========= ========= ========= =========
(A) Results exclude the effect of a $16.5 million charge ($11.1 million
after-tax), or $0.10 a diluted share, related to merger-related and
consolidation costs and a $2.5 million charge ($1.7 million after-tax), or
$0.02 a diluted share related to an impairment loss on businesses held for
disposal in the Engineered Industrial Products Segment. Results also
exclude the after-tax effect of income from discontinued operations ($6.9
million, or $0.07 a diluted share).
(B) Results exclude the effect of a $27.0 million charge ($18.5 million
after-tax), or $0.16 a diluted share, related to merger-related and
consolidation costs. Results also exclude the after-tax effect of income
from discontinued operations ($10.1 million, or $0.09 a diluted share).
6
THE BFGOODRICH COMPANY
(Dollars in millions except per share amounts)
Year Ended
December 31
---------------------------------------------------------
2000 2000 1999 1999
As Reported As Adjusted(A) As Reported As Adjusted(B)
Sales $ 4,363.8 $ 4,363.8 $ 4,319.8 $ 4,319.8
========= ========= ========= =========
Income before Income Taxes
and Trust Distributions 461.4 509.5 282.2 505.7
Income Tax Expense (156.7) (173.6) (125.1) (181.4)
Distributions on Trust Preferred
Securities (18.4) (18.4) (18.4) (18.4)
--------- --------- --------- ---------
Income from Continuing Operations 286.3 317.5 138.7 305.9
Income from Discontinued Operations 39.6 -- 30.9 --
--------- --------- --------- ---------
Net Income $ 325.9 $ 317.5 $ 169.6 $ 305.9
========= ========= ========= =========
Income Per Share:
Basic
Continuing Operations $ 2.73 $ 3.03 $ 1.26 $ 2.78
Discontinued Operations 0.38 -- 0.28 --
--------- --------- --------- ---------
Net Income $ 3.11 $ 3.03 $ 1.54 $ 2.78
========= ========= ========= =========
Diluted
Continuing Operations $ 2.68 $ 2.97 $ 1.26 $ 2.75
Discontinued Operations 0.36 -- 0.27 --
--------- --------- --------- ---------
Net Income $ 3.04 $ 2.97 $ 1.53 $ 2.75
========= ========= ========= =========
Weighted - Average Number
of Shares Outstanding
(in millions):
Basic 104.8 104.8 110.0 110.0
========= ========= ========= =========
Diluted 109.1 109.1 110.7 113.6
========= ========= ========= =========
(A) Results exclude the effect of a $45.6 million charge ($29.5 million
after-tax), or $0.27 a diluted share, related to merger-related and
consolidation costs and a $2.5 million charge ($1.7 million after-tax), or
$0.02 a diluted share related to an impairment loss on businesses held for
disposal in the Engineered Industrial Products Segment. Results also
exclude the after-tax effect of income from discontinued operations ($39.6
million, or $0.36 a diluted share).
(B) Results exclude the effect of a $232.1 million charge ($172.8 million
after-tax), or $1.52 a diluted share, related to merger-related and
consolidation costs and a $8.6 million net gain ($5.6 million after-tax),
or $0.05 on the sale of businesses. Results also exclude the after-tax
effect of income from discontinued operations ($30.9 million, or $0.27 a
diluted share). Weighted average diluted shares as adjusted include 2.9
million potential shares for assumed conversions of convertible preferred
securities that were anti-dilutive on an as reported basis.
7
BFGOODRICH SEGMENT REPORTING
(Dollars in millions)
Three Months Ended Year Ended
December 31 December 31
------------------------ ----------------------
2000 1999 2000 1999
Sales:
Aerospace:
Aerostructures and Aviation Services $ 374.1 $ 335.8 $1,455.5 $1,476.9
Landing Systems 272.7 256.7 1,057.7 1,060.6
Engine and Safety Systems 163.9 147.9 617.5 565.6
Electronic Systems 143.7 129.7 542.9 514.3
-------- -------- -------- --------
954.4 870.1 3,673.6 3,617.4
-------- -------- -------- --------
Engineered Industrial Products 163.0 159.7 690.2 702.4
-------- -------- -------- --------
Total Sales $1,117.4 $1,029.8 $4,363.8 $4,319.8
======== ======== ======== ========
Operating Income:
Aerospace:
Aerostructures and Aviation Services $ 53.8 $ 60.1 $ 209.0 $ 216.8
Landing Systems 40.9 31.3 149.0 147.1
Engine and Safety Systems 30.2 24.8 115.7 99.2
Electronic Systems 32.2 24.2 118.1 95.6
-------- -------- -------- --------
157.1 140.4 591.8 558.7
-------- -------- -------- --------
Engineered Industrial Products 26.9 18.9 122.1 118.2
-------- -------- -------- --------
Total Segment Operating Income $ 184.0 $ 159.3 $ 713.9 $ 676.9
Corporate General and Administrative Costs (22.1) (18.6) (76.5) (74.3)
Merger-related and Consolidation Costs (16.5) (27.0) (45.6) (232.1)
-------- -------- -------- --------
Total Operating Income $ 145.4 $ 113.7 $ 591.8 $ 370.5
======== ======== ======== ========
8
BFGOODRICH SEGMENT RESULTS
FOURTH QUARTER 2000 VERSUS THIRD QUARTER 2000
AEROSPACE SEGMENT
($ millions)
4Q00 3Q00
---- ----
Sales $954.4 $926.0
Operating Income 157.1 154.1
In the Aerospace segment, sales increased 3% from $926.0 in third quarter 2000
to $954.4 in fourth quarter 2000. This increase was due to increased OEM demand
and the strong aftermarket, led by both Electronic Systems and Engine & Safety
systems. Operating income during the same period increased $3.0 or 2% from
$154.1 in the third quarter to $157.1. The fourth quarter increases are due
primarily to the increased demand and the strong aftermarket.
ENGINEERED INDUSTRIAL PRODUCTS SEGMENT
($ millions)
4Q00 3Q00
---- ----
Sales $163.0 $167.4
Operating Income 26.9 29.0
In Engineered Industrial Products, sales in the fourth quarter decreased 3% from
$167.4 in the third quarter to $163.0 in the fourth quarter of 2000. This
decrease is primarily due to softness in the general industrial and heavy-duty
truck markets. Operating income decreased 7% from $29.0 in the third quarter to
$26.9 in the fourth quarter of 2000, primarily as a result of volume and sales
mix.
Page 1
9
BFGOODRICH GROUP RESULTS
FOURTH QUARTER AND YEAR-TO-DATE 2000 VERSUS
FOURTH QUARTER AND YEAR-TO-DATE 1999
BFGOODRICH AEROSPACE SEGMENT
----------------------------
AEROSTRUCTURES AND AVIATION SERVICES GROUP
- ------------------------------------------
($ millions)
FULL YEAR FULL YEAR
4Q00 4Q99 2000 1999
---- ---- ---- ----
Sales $374.1 $335.8 $1,455.5 $1,476.9
Operating Income 53.8 60.1 209.0 216.8
Sales for the year decreased 1% from $1,476.9 in 1999 to $1,455.5 in 2000. This
decrease was primarily a result of a decrease in commercial aircraft deliveries
in 2000, offset by strong aftermarket sales, especially on the Super 27.
Additionally, 1999 sales benefited from the PW4000 settlement. Operating income
for the year decreased $7.8, or 4%, from $216.8 during 1999 to $209.0 in 2000.
This decrease is primarily attributable to the one-time gains experienced in
1999 from the PW4000 settlement and a gain on sale of land. In the fourth
quarter of 2000, National Airlines declared Chapter 11 bankruptcy, causing a
write down of approximately $4 M pre-tax. Aviation services reported
disappointing results in the quarter as a result of decreased volume, the
National Airlines bankruptcy, increased overhead expense, and inventory
adjustments.
LANDING SYSTEMS GROUP
- ---------------------
($ millions)
FULL YEAR FULL YEAR
4Q00 4Q99 2000 1999
---- ---- ---- ----
Sales $272.7 $256.7 $1,057.7 $1,060.6
Operating Income 40.9 31.3 149.0 147.1
Sales during 2000 decreased $2.9, less than 1%, from $1,060.6 in 1999 to
$1,057.7 in 2000. This decrease is attributable to decreased sales in Landing
Gear and Landing Gear Services, offset by increased sales in the Wheels and
Brakes division. Despite the decrease in sales, operating income increased 1% to
$149.0 in 2000. This increase is primarily attributable to the increased sales
in Wheels and Brakes to the commercial aftermarket, regional, business, and
military markets, offset by decreased landing gear sales and inefficiencies
associated with the shutdown and transfer of production out of the Euless, TX
landing gear facility.
Page 2
10
ENGINE & SAFETY SYSTEMS GROUP
- -----------------------------
($ millions)
FULL YEAR FULL YEAR
4Q00 4Q99 2000 1999
---- ---- ---- ----
Sales $163.9 $147.9 $617.5 $565.6
Operating Income 30.2 24.8 115.7 99.2
Sales during 2000 increased $51.9, or 9%, from $565.6 in 1999 to $617.5 in 2000.
This increase reflects continued strong demand for Aerospace OE and industrial
gas turbine products. Operating income for the year increased $16.5, or 17%, to
$115.7. This increase is primarily attributable to increased volume and
favorable mix. Recovery of previously expensed non-recurring engineering costs
offset some of the higher R&D expenses related to continuing development of its
automotive products (Inflatabelt).
ELECTRONIC SYSTEMS GROUP
- ------------------------
($ millions)
FULL YEAR FULL YEAR
4Q00 4Q99 2000 1999
---- ---- ---- ----
Sales $143.7 $129.7 $542.9 $514.3
Operating Income 32.2 24.2 118.1 95.6
Sales for the year increased $28.6, or 6%, to $542.9 in 2000. The increase
resulted from higher OEM and aftermarket demand, especially in the Avionics and
Lighting Systems division. Sales were also bolstered by the strong performance
of the acquisitions in Space Flight Systems. Operating income for the year
increased $22.5, or 24%, from $95.6 in 1999 to $118.1 in 2000. This increase
reflects the impact of the higher sales as well as working capital and
productivity improvements.
Page 3
11
BFGOODRICH ENGINEERED INDUSTRIAL PRODUCTS SEGMENT
-------------------------------------------------
($ millions)
FULL YEAR FULL YEAR
4Q00 4Q99 2000 1999
---- ---- ---- ----
Sales $163.0 $159.7 $690.2 $702.4
Operating Income 26.9 18.9 122.1 118.2
Sales for the year decreased $12.2, or 2%, from $702.4 in 1999 to $690.2 in
2000. The decrease in sales is primarily attributable to the completion of a
large engine project during 1999 and the initiation of a similar but lower
revenue-producing project during 2000. Despite the decrease in sales, operating
income increased $3.9, or 3%, from $118.2 in 1999 to $122.1 in 2000. The
increase in operating income for the year was due to lower development costs at
Fairbanks Morse, cost reductions, productivity improvements and operational
performance, partially offset by pressures related to foreign currency.
Page 4
12
Non-Segment Expenses
--------------------
($ millions)
FULL YEAR FULL YEAR
4Q00 4Q99 2000 1999
---- ---- ---- ----
Corporate G&A $ 22.1 $ 18.6 $ 76.5 $ 74.3
Net Interest Expense 29.2 22.3 105.5 86.5
Distribution on Trust
Preferred Securities 4.6 4.6 18.4 18.4
Preliminary Balance Sheet and Cash Flow Data
--------------------------------------------
($ millions)
WITH PERFORMANCE MATERIALS WITHOUT PERFORMANCE MATERIALS
Full Year Full Year Full Year Full Year
12/31/2000 12/31/1999 12/31/2000 12/31/1999
---------- ---------- ---------- ----------
Cash and Cash Equivalents $ 77.5 $ 66.4 $ 77.5 $ 66.4
Total Debt $2,254.2 $1,760.5 $2,254.2 $1,760.5
Debt to Capitalization 59.9% 52.8% 59.9% 52.8%
Capital Expenditures $ 213.6 $ 246.3 $ 148.1 $ 172.5
Acquisitions $ 258.4 $ 76.1 $ 246.8 $ 56.5
Dividends $ 117.6 $ 91.6 $ 117.6 $ 91.6
Depreciation and Amortization $ 279.0 $ 246.8 $ 192.5 $ 160.5
- - Depreciation $ 195.7 $ 176.5 $ 133.6 $ 114.8
- - Amortization $ 83.3 $ 70.3 $ 58.9 $ 45.7
- - Goodwill Amortization $ 46.6 $ 45.3 $ 27.4 $ 24.9
(included in Amortization, above)
Page 5
13
ACCOUNTS RECEIVABLE
-------------------
($ millions)
1999 2000
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
--------------------------------------------------------------------------------------------
As Reported $649.8 $694.9 $666.4 $660.5 $719.9 $779.4 $842.4 $910.6
Less: Corporate Receivables (105.5) (131.4) (138.7) (158.4) (180.5) (216.9) (236.3) ($245.9)
Less: Raytheon /OEA Receivables --- --- --- --- --- --- --- ($95.5)
--------------------------------------------------------------------------------------------
Trade Accounts Receivable $544.3 $563.5 $527.7 $502.1 $539.4 $562.5 $606.1 $569.2
Days sales outstanding (DSO)* 40.6 43.7 43.8 46.2 41.3 44.1 46.6 46.6
*DSO represents the number of preceding days sales comprising the trade accounts
receivable balance.
DSO, calculated using trade accounts receivable, was 47 days for the fourth
quarter of 2000, as compared to 47 days in the third quarter of 2000 and 46 days
in the fourth quarter of 1999. The Company's DSO has ranged from 41 to 47 days
over the past eight quarters as illustrated above due to normal fluctuations in
the amount and timing of revenue and collections. Corporate receivables are
excluded as these amounts, primarily receivables from insurance carriers for
asbestos claim settlements, are not correlated with revenue and therefore
distort the DSO calculation. Raytheon Optical Systems and OEA receivables of
$95.5M are also excluded from the fourth quarter calculation as no sales were
recorded for them in 2000.
INVENTORY
---------
($ millions)
1999 2000
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
------------------------------------------------------------------------------------------------
Inventory* $786.7 $749.8 $793.4 $810.7 $831.0 $854.9 $880.2 $865.3
717-200 pre-production/
excess over average (125.3) (132.6) (135.0) (138.8) (140.5) (140.8) (136.3) ($133.2)
Raytheon & OEA Inventory --- --- --- --- --- --- --- ($27.9)
------------------------------------------------------------------------------------------------
Adjusted inventory $661.4 $617.2 $658.4 $671.9 $690.5 $714.1 $743.9 $704.2
Days sales in inventory (DSI) 49.6 48.6 55.7 62.1 53.8 56.6 58.6 57.9
*DSI represents the number of preceding days sales comprising the inventory
balance.
DSI, excluding pre-production and excess over average costs on the 717-200
program, was 58 days in the fourth quarter of 2000, as compared to 59 days in
the third quarter of 2000 and 62 days in the fourth quarter of 1999.
Pre-production and excess over average costs on the 717-200 program and the
inventory from Raytheon and OEA are excluded as these amounts are not correlated
with current revenues and therefore distort the DSI calculation.
Page 6
14
THE BFGOODRICH COMPANY
($ MILLIONS)
---------------------------------------------
2000
---------------------------------------------
Q1 Q2 Q3 Q4 2000
---------------------------------------------
AEROSPACE
SALES Aerostructures & Aviation
Services 357.6 348.4 375.4 374.1 1,455.5
Landing Systems 260.1 259.0 265.9 272.7 1,057.7
Engine & Safety Systems 147.8 153.5 152.3 163.9 617.5
Electronic Systems 127.5 139.3 132.4 143.7 542.9
Total Trade Sales 893.0 900.2 926.0 954.4 3,673.6
OPERATING Aerostructures & Aviation
Services 48.9 49.0 57.3 53.8 209.0
INCOME Landing Systems 37.3 35.1 35.7 40.9 149.0
Engine & Safety Systems 27.3 30.2 28.0 30.2 115.7
Electronic Systems 25.2 27.6 33.1 32.2 118.1
Total Operating Income 138.7 141.9 154.1 157.1 591.8
MARGIN Aerostructures & Aviation
Services 13.7% 14.1% 15.3% 14.4% 14.4%
Landing Systems 14.3% 13.6% 13.4% 15.0% 14.1%
Engine & Safety Systems 18.5% 19.7% 18.4% 18.4% 18.7%
Electronic Systems 19.8% 19.8% 25.0% 22.4% 21.8%
Total Operating Margin 15.5% 15.8% 16.6% 16.5% 16.1%
---------------------------------------------
ENGINEERED INDUSTRIAL PRODUCTS
---------------------------------------------
SALES 177.6 182.2 167.4 163.0 690.2
OPERATING INCOME 33.6 32.6 29.0 26.9 122.1
MARGIN 18.9% 17.9% 17.3% 16.5% 17.7%
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TOTAL SALES 1,070.6 1,082.4 1,093.4 1,117.4 4,363.8
SEGMENT OPERATING INCOME 172.3 174.5 183.1 184.0 713.9
MARGIN 16.1% 16.1% 16.7% 16.5% 16.4%
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15
THE BFGOODRICH COMPANY
($ MILLIONS)
--------------------------------------------
1999
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Q1 Q2 Q3 Q4 1999
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AEROSPACE
SALES Aerostructures & Aviation Services 387.5 421.2 332.4 335.8 1,476.9
Landing Systems 262.5 279.9 261.5 256.7 1,060.6
Engine & Safety Systems 143.5 137.8 136.4 147.9 565.6
Electronic Systems 132.7 127.0 124.9 129.7 514.3
Total Trade Sales 926.2 965.9 855.2 870.1 3,617.4
OPERATING Aerostructures & Aviation Services 56.5 55.4 44.8 60.1 216.8
INCOME Landing Systems 36.8 42.5 36.5 31.3 147.1
Engine & Safety Systems 24.7 25.2 24.5 24.8 99.2
Electronic Systems 24.5 21.8 25.1 24.2 95.6
Total Operating Income 142.5 144.9 130.9 140.4 558.7
MARGIN Aerostructures & Aviation Services 14.6% 13.2% 13.5% 17.9% 14.7%
Landing Systems 14.0% 15.2% 14.0% 12.2% 13.9%
Engine & Safety Systems 17.2% 18.3% 18.0% 16.8% 17.5%
Electronic Systems 18.5% 17.2% 20.1% 18.7% 18.6%
Total Operating Margin 15.4% 15.0% 15.3% 16.1% 15.4%
--------------------------------------------
ENGINEERED INDUSTRIAL PRODUCTS
--------------------------------------------
SALES 185.6 186.5 170.6 159.7 702.4
OPERATING INCOME 34.2 37.0 28.1 18.9 118.2
MARGIN 18.4% 19.8% 16.5% 11.8% 16.8%
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TOTAL SALES 4,319.8
1,111.8 1,152.4 1,025.8 1,029.8
SEGMENT OPERATING INCOME 176.7 181.9 159.0 159.3 676.9
MARGIN 15.9% 15.8% 15.5% 15.5% 15.7%
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