FY2021 10-K Document - FINAL 11 15 21 - Flipbook - Page 28
Table of Contents
CONSOLIDATED RESULTS OF OPERATIONS
The following is a discussion of our results of operations in 2021 compared to 2020. A discussion of our 2020 results
of operations compared to 2019 results can be found within Part II, Item 7. Management's Discussion and
Analysis within our 2020 Annual Report on Form 10-K, filed with the Securities and Exchange Commission
on November 17, 2020.
2021 vs. 2020
(dollars and shares in millions, except per
share data)
Net sales
$
Gross margin
Research and development expenses
$
Selling, general and administrative
expenses as a percentage of sales
Interest expense
$
Restructuring expense
$
Long-lived asset impairment
$
Pension settlement
$
Other
$
Effective tax rate
Net earnings
$
Diluted average common shares
outstanding
2021
2020
2019
2,852
27.2 %
126
$ 2,885
25.8 %
$ 111
$ 2,905
28.1 %
$ 126
14.4 %
34
—
2
—
(1)
22.8 %
157
13.8 %
39
11
38
121
21
(69.9)%
9
13.9 %
39
—
—
—
19
23.1 %
175
$
$
$
$
$
$
$
$
$
$
$
$
$
Variance
2020 vs. 2019
%
Variance
$
Variance
%
Variance
$
(33)
(1%)
$
(20)
(1%)
$
15
13%
$
(16)
(12%)
$
$
$
$
$
(5)
(11)
(36)
(121)
(22)
(13%)
(100%)
(96%)
(100%)
(105%)
$
$
$
$
$
—
11
38
121
2
(1%)
n/a
n/a
n/a
12%
$
148
n/a
$
(165)
(95%)
(2)
(5%)
4.59
$
(4.68)
(94%)
32
33
35
Diluted earnings per share
$ 4.87
$ 0.28
$ 4.96
$
(1)
Total backlog
$ 4,800
$ 2,600
$ 2,200
$ 2,200
88%
$
400
14%
Twelve-month backlog
$ 2,100
$ 1,700
$ 1,500
$
24%
$
200
13%
400
(3%)
n/a
Net sales for the 2021 year are down marginally in comparison to 2020, due to the timing of the recovery from the
COVID-19 pandemic. In 2021, sales were impacted by a full year of COVID-19 related pressure, as compared to 2020
where only the second half of the year was impacted. Sales growth in Space and Defense was offset by decreases
within Industrial Systems and Aircraft Controls, the segments most impacted by this pandemic. Stronger foreign
currencies, primarily the Euro relative to the U.S. Dollar, increased sales $34 million in the year in comparison to
2020, offsetting the real sales decrease. Additionally, the acquisition of Genesys contributed $44 million of incremental
sales compared to 2020.
Gross margin increased in 2021 compared to 2020 due to the absence of last year's $23 million COVID-19 related
inventory write-down. Excluding last year's COVID-19 related charges, gross margin increased marginally due to
favorable sales mixes within Aircraft Controls and Industrial Systems. Also, higher sales volume within Space and
Defense contributed to the increase. Partially offsetting these increases was lower sales volumes within Aircraft
Controls and Industrial Systems.
Research and development expenses increased across Aircraft Controls and Industrial Systems in 2021 as compared
to the prior year. The incorporation of the Genesys acquisition and higher activity across military development
programs within Aircraft Controls increased research and development expenses $10 million. Research and
development expenses also increased in Industrial Systems by $4 million for the year, due to higher innovation spend.
For 2021, selling, general and administrative expenses were slightly higher as a percentage of sales than the prior
year, reflecting increased investments after several quarters of depressed spending throughout 2020 due to the
COVID-19 pandemic.
Interest expense for fiscal 2021 decreased compared to 2020 due to lower interest rates on outstanding debt.
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