harris corporation

NETCENTS program. This revenue growth was mostly offset by a decline in Broadcast and New Media Solutions
revenue, primarily due to continued lower U.S. broadcaster capital spending as well as the completion of the
transition from analog to digital transmission in the U.S. The operating loss in fiscal 2009 was due to a
$255.5 million non-cash charge for impairment of goodwill and other long-lived assets in Broadcast and New Media
Solutions, and included $13.1 million in charges related to cost-reduction actions, also in Broadcast and New Media
Solutions. Operating income in fiscal 2010 included $10 million in charges related to cost-reduction actions and
$6 million in inventory write-downs associated with weaker product demand in Broadcast and New Media Solutions
as a result of continuing weakness in the U.S. broadcast market.
In the second quarter of fiscal 2010, we acquired Patriot, which had about 100 employees and expanded our
position as a leading provider of integrated and interoperable healthcare IT solutions for the U.S. Government
market. Additionally, we believed this acquisition further positioned us for providing a comprehensive solution
addressing the national priority of integrating the VA and Military Health Systems.
Orders for this segment were $1.51 billion for fiscal 2010 compared with $1.42 billion for fiscal 2009. In fiscal
2010 and fiscal 2009, this segment derived 64 percent and 57 percent, respectively, of its revenue from
U.S. Government customers, including the DoD and intelligence and civilian agencies, as well as foreign military
sales through the U.S. Government, whether directly or through prime contractors.
Government Communications Systems Segment
2011 2010
2011/2010
Percent
Increase/
(Decrease) 2009
2010/2009
Percent
Increase/
(Decrease)
(Dollars in millions)
Revenue ............................. $1,776.5 $1,747.3 1.7% $1,864.2 (6.3)%
Segment operating income ............... 227.0 227.4 (0.2)% 199.2 14.2%
% of revenue ....................... 12.8% 13.0% 10.7%
Fiscal 2011 Compared With Fiscal 2010: Revenue in fiscal 2011 compared with fiscal 2010 increased on the
GOES-R Ground and Antenna Segment weather programs for NOAA, HNRs for the U.S. Army and our space
communications programs (including satellite reflector programs for commercial customers), but declined on several
classified programs as a result of slower U.S. Government spending. Revenue also declined, as expected, on the
FDCA program for the 2010 U.S. Census due to its wind-down. Important ongoing programs for this segment
include FTI, GOES-R, F-35, MET, WIN-T and various classified space communications systems programs.
Operating income and income as a percentage of revenue in fiscal 2011 were essentially flat compared with
fiscal 2010. This was primarily due to improved performance on our space communications systems programs
(including satellite reflector programs for commercial customers), the GOES-R Ground and Antenna Segment
weather programs and HNR sales to the U.S. Army, partially offset by the impact of the wind-down on the FDCA
program for the 2010 U.S. Census and lower operating income on several classified programs.
Orders for this segment were $1.69 billion for fiscal 2011 and $1.78 billion for fiscal 2010. In fiscal 2011 and
fiscal 2010, this segment derived 97 percent and 94 percent, respectively, of its revenue from U.S. Government
customers, including the DoD and intelligence and civilian agencies, as well as foreign military sales through the
U.S. Government, whether directly or through prime contractors.
Fiscal 2010 Compared With Fiscal 2009: Revenue in fiscal 2010 compared with fiscal 2009 declined as the
FDCA program for the U.S. Census Bureau for the 2010 U.S. Census neared completion. The $238 million decline
in revenue from the FDCA program in fiscal 2010 was partially offset by increased revenue in fiscal 2010 from the
GOES-R Ground Segment weather program for NOAA, the MET program for the U.S. Army, the FTI program, the
F-35 Joint Strike Fighter program and the WIN-T program.
The increases in operating income and operating income as a percentage of revenue in fiscal 2010 compared
with fiscal 2009 were primarily due to excellent award fees and overall program execution across the segment.
Additionally, operating income in fiscal 2009 included an $18.0 million charge for schedule and cost overruns on
commercial satellite reflector programs.
Orders for this segment were $1.78 billion for fiscal 2010 and $1.88 billion for fiscal 2009. In both fiscal 2010
and fiscal 2009, this segment derived 94 percent of its revenue from U.S. Government customers, including the DoD
and intelligence and civilian agencies, as well as foreign military sales through the U.S. Government, whether
directly or through prime contractors.
44