RECONCILIATION OF NON-GAAP FINANCIAL MEASURES AND REGULATION G DISCLOSURE
To supplement our condensed consolidated financial statements presented in accordance with U.S. generally accepted accounting principles (GAAP), we provide additional measures of net income and net income per diluted common share and net cash provided by operating activities, adjusted to exclude certain costs, charges, expenses and losses or other amounts. Harris management believes that these non-GAAP financial measures, when considered together with the GAAP financial measures, provide information that is useful to investors in understanding period-over-period operating results separate and apart from items that may, or could, have a disproportionately positive or negative impact on results in any particular period. Harris management also believes that these non-GAAP financial measures enhance the ability of investors to analyze Harris’ business trends and to understand Harris’ performance. In addition, Harris may utilize non-GAAP financial measures as guides in its forecasting, budgeting, and long-term planning processes and to measure operating performance for some management compensation purposes. Any analysis of non-GAAP financial measures should be used only in conjunction with results presented in accordance with GAAP. A reconciliation of these non-GAAP financial measures with the most directly comparable financial measures calculated in accordance with GAAP follows:
Table 5 | |||||||||||||||
HARRIS CORPORATION | |||||||||||||||
FY '17 First Quarter Summary | |||||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | |||||||||||||||
Net Income and Net Income per Diluted Common Share | |||||||||||||||
(Unaudited) | |||||||||||||||
Quarter Ended | |||||||||||||||
September 30, 2016 | |||||||||||||||
As Reported | Adjustment (A) | Non-GAAP | |||||||||||||
(In millions, except per share amounts) | |||||||||||||||
Net income | $ | 160 | $ | 15 | $ | 175 | |||||||||
Net income per diluted common share | $ | 1.27 | $ | 0.12 | $ | 1.39 | |||||||||
Quarter Ended | |||||||||||||||
October 2, 2015 | |||||||||||||||
As Reported | Adjustment (A) | Non-GAAP | |||||||||||||
(In millions, except per share amounts) | |||||||||||||||
Net income | $ | 148 | $ | 15 | $ | 163 | |||||||||
Net income per diluted common share | $ | 1.18 | $ | 0.13 | $ | 1.31 | |||||||||
(A) Adjustment for integration and other Exelis Inc. acquisition-related charges, net of income taxes |
Table 6 | |||||||||||
HARRIS CORPORATION | |||||||||||
FY '17 First Quarter Summary | |||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | |||||||||||
Free Cash Flow | |||||||||||
(Unaudited) | |||||||||||
Quarter Ended | 2017 | ||||||||||
September 30, 2016 | (Guidance) | ||||||||||
(In millions) | |||||||||||
Net cash provided by operating activities | $ | 43 | $ | 975 | |||||||
Less net capital expenditures (A) | (21 | ) | (175 | ) | |||||||
Free cash flow | $ | 22 | $ | 800 | |||||||
(A) Reflects additions of property, plant and equipment, net of proceeds from the sale of property, plant and equipment. |
Table 7 | ||||
HARRIS CORPORATION | ||||
FY '17 First Quarter Summary | ||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | ||||
Reconciliation of Guidance for FY '17 Net Income per Diluted Common Share to | ||||
FY '17 Non-GAAP Net Income per Diluted Common Share | ||||
(Unaudited) | ||||
2017 | ||||
(Guidance) | ||||
GAAP net income per diluted common share | $5.53 to $5.73 | |||
Estimated net impact of acquisition-related items | $.17 | |||
Non-GAAP net income per diluted common share | $5.70 to $5.90 |