Goldman Sachs Global Industrials Conference 2010

Goldman Sachs Global Industrials
Conference 2010
Howard L. Lance
Chairman, President and Chief Executive Officer
RF COMMUNICATIONS • GOVERNMENT COMMUNICATIONS SYSTEMS • BROADCAST COMMUNICATIONS
Corporate Strategy, 1
Investor Briefing, November 2010

Forward-looking statements
Statements in this presentation that are not historical facts are forward-looking statements that reflect
management's current expectations, assumptions, and estimates of future performance and economic
conditions. Such statements are made in reliance upon the safe harbor provisions of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements in
this presentation include but are not limited to: earnings and revenue guidance for fiscal 2011; the potential
value of contract awards; and statements regarding outlook, including expected revenue and orders. The
company cautions investors that any forward-looking statements are subject to risks and uncertainties that
may cause actual results and future trends to differ materially from those matters expressed in or implied by
such forward-looking statements. The company's consolidated results and the forward-looking statements
could be affected by many factors, including but not limited to: the loss of our relationship with the U.S.
government or a shift in U.S. government funding; potential changes in U.S. government or customer priorities;
risks inherent with large long-term fixed-price contracts, particularly the ability to contain cost overruns;
financial and government and regulatory risks relating to international sales and operations; our ability to
continue to develop new products that achieve market acceptance; the consequences of future geo-political
events; strategic acquisitions and the risks and uncertainties related thereto, including our ability to manage
and integrate acquired businesses; performance of our subcontractors and suppliers; potential claims that we
are infringing the intellectual property rights of third parties; the successful resolution of patent infringement
claims and the ultimate outcome of other contingencies, litigation and legal matters; risks inherent in
developing new technologies; changes in our effective tax rate; the potential impact of natural disasters or
other disruptions on our operations; the potential impact of a security breach, through cyber attack or
otherwise, or other significant disruptions of our IT networks and systems or those we operate for customers;
the potential impact of satellite bandwidth constraints on our managed satellite communications services;
changes in future business conditions that could cause business investments and/or recorded goodwill to
become impaired; and the recession in the United States and general downturn in the global economy. Further
information relating to factors that may impact the company's results and forward-looking statements are
disclosed in the company's filings with the SEC. The forward-looking statements contained in this release are
made as of the date of this release, and the company disclaims any intention or obligation, other than imposed
by law, to update or revise any forward-looking statements, whether as a result of new information, future
events, or otherwise.
Corporate Strategy & Outlook, 2 Investor Briefing, November 2010

Solid track record of growth
Revenue ($ in billions) Earnings per share
$3.1
$3.7
FY06 FY07 FY08 FY09 FY10 FY11E
Corporate Strategy & Outlook, 3
$4.6
$5.0
$5.2
$5.9 – 6.0
14% CAGR 18% CAGR
$2.15
$2.71
$3.33
$3.85
$4.43
FY06 FY07 FY08 FY09 FY10 FY11E
Based on fiscal 2011 guidance provided on October 25, 2010. Reference non-GAAP reconciliation on the Harris investor relations website.
$4.80 – 4.90
Investor Briefing, November 2010

Strong financial position
• Excellent liquidity
– $341 million in cash and cash equivalents at quarter end
– No long-term debt maturities before October 2015
– $750 million credit facility in place through 2013 with $475 available
at the end of the first quarter; and a fully available $300 million,
364-day revolving credit facility
– Cash flow from operations expected to be in a range of $775 - $825
million in fiscal 2011
• Strong balance sheet
– Total-debt-to-total-capital ratio of 39%
– Debt ratings at BBB+/Baa1
• $400 million remaining under stock repurchase program
authorized February 2009
• Quarterly dividend of $.25 per share
Corporate Strategy & Outlook, 4 Investor Briefing, November 2010

Corporate strategic vision
Corporate Strategy & Outlook, 5 Investor Briefing, November 2010

Falcon III is changing the game with
battlefield proven JTRS radios
• Multiband, multi-mission interoperability
• Providing wideband networking to
the tactical edge - streaming
video, soldier-to-soldier data
transmission, ISR applications,
SIPRNET IP
• Embraced by all branches of U.S.
Armed Forces with over 125,000
radios fielded
• Secure wideband networking
capability on 117G manpack radio
being deployed to all of the U.S.
Army Brigade Combat Teams in
Afghanistan
• Mission modules to expand
functionality, including
ISR capabilities
Video
Dissemination
Network-wide
Email & Chat
Ground-to-Air
Situational
Awareness
TACSAT
Falcon III family addresses the full range of mission requirements
today and enables the mission critical applications of the future
Biometrics
Data
Legacy
Interoperability
First
Responders
APCO P-25
RF Communications, 6 Investor Briefing, November 2010
ISR

U.S. Armed Forces ground tactical
radios in service
MB MP
Raytheon PSC- 5
Raytheon EPLRS
Harris AN/PRC- 117F
Harris estimate of radios in units.
RF Communications, 7
Legacy radios
MB HH
Thales MBITR
1.1 million radios
Acquisition cost ~ $14 Billion
SPR
Motorola, ICOM, EFJ
HF
Harris AN/PRC- 150
JTRS HH and MP
Thales AN/PRC- 148
Harris AN/PRC- 152
Harris AN/PRC- 110
Harris AN/PRC- 117G
VHF- SINCGARS
ITT
Large long-term replacement
market for non-JTRS radios
Investor Briefing, November 2010

Major international standardization
programs and opportunities
Recent standardization program wins
Standardization program opportunities
Multi-year standardization programs create long-term stability in the international market
RF Communications, 8 Investor Briefing, November 2010

Situational awareness in the cockpit
F/A-18
• Avionics processing and
mass storage products
• Digital map products
Potential program value: $675M
F-22
• Fiber-optic network products
• Fiber network interface unit
• High speed data bus products
Potential program value: $450M
F-35
• Fiber-optic network products
• Avionics infrastructure solutions
• Multifunction Advanced Data Link
(MADL) antennae
Potential program value: $4.2B
F/A-18
New opportunities
• Image georegistration
• DTP upgrades
Network processor
F-22 and F-35
New opportunities
• IP networking and SATCOM
• Harris extremely
sensitive receiver
• Image georegistration
• Wideband network rack
• Retrofit opportunities
Government Communications Systems, 9 Investor Briefing, November 2010

FAA Telecommunications
Infrastructure (FTI) program
• Harris prime to FAA
• FTI Operations Network
• FTI Mission Support Network
• FTI Satellite/Microwave Network
• FTI Network and Security Operations
Control Centers
• Over 4,500 locations nationwide; 21,000 services
• $600 million life-cycle savings
• On going network evolution – national optical
backbone build-out underway
Potential program value
• $2.8B, 15 years, awarded July 2002
• $3.5B contract ceiling – FAA communications franchise
Government Communications Systems, 10 Investor Briefing, November 2010

Geostationary Operational Environmental
Satellite R-Series (GOES-R)
teammates –
Harris is the prime contractor and responsible
for developing, deploying and operating the
GOES-R Ground Segment and Antenna System
• Performs satellite operations, manages ground
elements, produces operational weather products
and distributes these products to National Weather
Service forecasters, climate scientists and academia
• Install or refurbish 10 antennas that receive raw
weather data and distribute this data to the ground
segment for processing
Potential program value
• $1B, 10 years (~$400M planned over 3 years)
• Awarded May 2009
Government Communications Systems, 11 Investor Briefing, November 2010

Public Safety and Professional
Communications – key markets
Public safety / public service
Transit and transportation
Utility
U.S. DoD and Federal
International
RF Communications, 12 Investor Briefing, November 2010

CapRock Communications global
satellite operations footprint
Extensive global infrastructure supporting government, energy and maritime markets
Government Communications Systems, 13 Investor Briefing, November 2010

Executive summary
• Fiscal year 2010 produced exceptional results in a time of
challenging global markets
• We have established a culture focused on delivering continuous
growth in revenue, earnings and cash flow
• Our core businesses are well-positioned with a track record of
solid execution and market share gains
• Growth initiatives in adjacent markets are contributing
• Strategic acquisitions further enhance revenue and earnings
growth and business diversification
• Strong operating cash flow and conservative balance sheet
management provides flexibility
Corporate Strategy & Outlook, 14 Investor Briefing, November 2010