L3Harris Technologies (LHX) Tops Q4 EPS by 7c; Initiates FY20 EPS Mid-Point Guidance Above Consensus

L3Harris Technologies (NYSE: LHX) reported Q4 EPS of $2.85, $0.07 better than the analyst estimate of $2.78. Revenue for the quarter came in at $4.8 billion versus the consensus estimate of $4.81 billion.

• 4Q19 revenue $4.8 billion; up 190% GAAP and 10% versus prior-year combined1
• 4Q19 GAAP EPS from continuing operations down 6% to $1.77; non-GAAP2 up 28% versus prior-year combined to $2.85
• 4Q19 operating cash flow of $858 million and adjusted free cash flow3 of $831 million
• 2H19 revenue $9.2 billion, GAAP EPS from continuing operations $3.68, non-GAAP2 EPS $5.43, operating cash flow $939 million and adjusted free cash flow3 $1.45 billion
• CY19 combined revenue $18.1 billion, GAAP EPS from continuing operations $7.90, non-GAAP2 EPS $10.08, operating cash flow $1.7 billion and adjusted free cash flow3 $2.46 billion
• Initiated CY20 guidance: revenue up 5% - 7%, GAAP EPS $8.35 - $8.75, non-GAAP2 EPS $11.35 - $11.75, operating cash flow $2.8 - $2.9 billion and adjusted free cash flow3 $2.6 - $2.7 billion

"We ended the year on a high note, capping a strong second half with double-digit revenue growth, margin expansion in every segment and robust free cash flow while returning $1.8 billion to shareholders," said William M. Brown, Chairman and Chief Executive Officer. "With a well-funded defense budget, integration progressing ahead of schedule and momentum building on operational excellence, we are well positioned to generate strong earnings and free cash flow growth in 2020 and beyond."

GUIDANCE:

L3Harris Technologies sees FY2020 EPS of $11.35-$11.75, versus the consensus of $11.45.

As a result of strong momentum and performance in 2019, L3Harris initiated the following guidance for 2020:

• Organic revenue up 5% - 7% from combined full-year calendar 2019 revenue
• GAAP EPS in a range of $8.35 - $8.75 and non-GAAP EPS7 in a range of $11.35 - $11.75
• Operating cash flow in a range of $2.8 - $2.9 billion; adjusted free cash flow8 in a range of $2.6 - $2.7 billion

For earnings history and earnings-related data on L3Harris Technologies (LHX) click here.

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