Exelis Inc.

CIK:0001524471|SEC Filings

Accumulated Other Comprehensive Loss

3 Months Ended

Mar. 31, 2015

ACCUMULATED OTHER COMPREHENSIVE LOSS

The following table presents changes in accumulated other comprehensive loss, net of tax, by component, for the three months ended March 31, 2015:



	Net Foreign Currency Translation Adjustments			Unamortized Defined Benefit Plan Costs				Accumulated Other Comprehensive Loss
Balance at January 1, 2015	$	8		$	(1,887	)		$	(1,879	)
Other comprehensive income (loss) before reclassifications	(9		)	—				(9		)
Amounts reclassified from accumulated other comprehensive loss	—			18			(a)	18
Other comprehensive income (loss), net of tax	(9		)	18				9
Balance at March 31, 2015	$	(1	)	$	(1,869	)		$	(1,870	)


(a)	This accumulated other comprehensive loss component primarily relates to the amortization of net actuarial loss. For the three months ended March 31, 2015, the amortization of net actuarial loss was $18 (net of tax of $11), which is included in the computation of net periodic benefit cost (Note 12).

Unamortized defined benefit plan costs consist primarily of net actuarial loss totaling $1,865 and $1,883, net of tax, as of March 31, 2015 and December 31, 2014, respectively. Net actuarial gains or losses principally arise from gains or losses on plan assets due to variations in the fair market value of the underlying assets and changes in the benefit obligation due to changes in actuarial assumptions.

Unamortized defined benefit plan costs included in accumulated other comprehensive loss in the unaudited Condensed Consolidated Balance Sheets were reduced by taxes of $1,221 and $1,232 as of March 31, 2015 and December 31, 2014, respectively. The changes in defined benefit plan costs included in other comprehensive income (loss) in the unaudited Condensed Consolidated Statements of Comprehensive Income were reduced by taxes of $11 and $8 for the three months ended March 31, 2015 and 2014, respectively.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Operating activities
Net income	$ 59us-gaap_NetIncomeLoss	$ 52us-gaap_NetIncomeLoss
Income from discontinued operations, net of tax	0	13
Income from continuing operations	59	39
Adjustments to reconcile net income to net cash used in operating activities from continuing operations:
Depreciation and amortization	25	26
Stock-based compensation	8us-gaap_ShareBasedCompensation	8us-gaap_ShareBasedCompensation
Restructuring and asset impairment charges	1	5
Payments for restructuring	(2)us-gaap_PaymentsForRestructuring	(10)us-gaap_PaymentsForRestructuring
Defined benefit plans expense	20	17
Defined benefit plans payments	(41)	(42)
Change in assets and liabilities
Change in receivables	(30)us-gaap_IncreaseDecreaseInReceivables	(42)us-gaap_IncreaseDecreaseInReceivables
Change in inventories	(8)us-gaap_IncreaseDecreaseInInventories	(17)us-gaap_IncreaseDecreaseInInventories
Change in other assets	(1)	(3)
Change in accounts payable	(8)	(31)
Change in advance payments and billings in excess of costs	(10)	(24)
Change in deferred taxes	14	13
Change in other liabilities	(44)	(44)
Other, net	0	(3)
Net cash used in operating activities from continuing operations	(17)	(108)
Investing activities
Capital expenditures	(8)	(7)
Proceeds from the sale of assets	6	3
Net cash used in investing activities from continuing operations	(2)	(4)
Financing activities
Dividends paid	(20)us-gaap_PaymentsOfDividendsCommonStock	(20)us-gaap_PaymentsOfDividendsCommonStock
Common stock repurchased	0	(24)
Proceeds from the exercise of stock options	12	12
Transfer from Vectrus, net	0us-gaap_PaymentsForAdvanceToAffiliate	3us-gaap_PaymentsForAdvanceToAffiliate
Other, net	1	5
Net cash used in financing activities from continuing operations	(7)	(24)
Exchange rate effects on cash and cash equivalents	(5)	0
Net cash used in discontinued operations	0	(50)
Net change in cash and cash equivalents	(31)	(186)
Cash and cash equivalents – beginning of year	510	459
Cash and cash equivalents – end of period	$ 479	$ 273

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (USD $) In Millions, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Current assets
Cash and cash equivalents	$ 479	$ 510
Receivables, net	853us-gaap_ReceivablesNetCurrent	824us-gaap_ReceivablesNetCurrent
Inventories, net	231	225
Deferred tax asset	55us-gaap_DeferredTaxAssetsNetCurrent	56us-gaap_DeferredTaxAssetsNetCurrent
Other current assets	47us-gaap_OtherAssetsCurrent	47us-gaap_OtherAssetsCurrent
Total current assets	1,665us-gaap_AssetsCurrent	1,662us-gaap_AssetsCurrent
Plant, property and equipment, net	422us-gaap_PropertyPlantAndEquipmentNet	437us-gaap_PropertyPlantAndEquipmentNet
Goodwill	1,973us-gaap_Goodwill	1,976us-gaap_Goodwill
Other intangible assets, net	143	150
Deferred tax asset	541us-gaap_DeferredTaxAssetsNetNoncurrent	566us-gaap_DeferredTaxAssetsNetNoncurrent
Other non-current assets	87us-gaap_OtherAssetsNoncurrent	87us-gaap_OtherAssetsNoncurrent
Total non-current assets	3,166us-gaap_AssetsNoncurrent	3,216us-gaap_AssetsNoncurrent
Total assets	4,831us-gaap_Assets	4,878us-gaap_Assets
Current liabilities
Accounts payable	229us-gaap_AccountsPayableCurrent	238us-gaap_AccountsPayableCurrent
Advance payments and billings in excess of costs	231	242
Compensation and other employee benefits	120	170
Other accrued liabilities	134us-gaap_AccruedLiabilitiesCurrent	124us-gaap_AccruedLiabilitiesCurrent
Total current liabilities	714us-gaap_LiabilitiesCurrent	774us-gaap_LiabilitiesCurrent
Defined benefit plans	2,021	2,072
Long-term debt	649us-gaap_LongTermDebtNoncurrent	649us-gaap_LongTermDebtNoncurrent
Deferred tax liability	2	2
Other non-current liabilities	135us-gaap_OtherLiabilitiesNoncurrent	134us-gaap_OtherLiabilitiesNoncurrent
Total non-current liabilities	2,807us-gaap_LiabilitiesNoncurrent	2,857us-gaap_LiabilitiesNoncurrent
Total liabilities	3,521us-gaap_Liabilities	3,631us-gaap_Liabilities
Commitments and contingencies (Note 15)
Shareholders’ equity
Common stock	2us-gaap_CommonStockValue	2us-gaap_CommonStockValue
Additional paid-in capital	2,621	2,607
Treasury stock	(128)us-gaap_TreasuryStockValue	(128)us-gaap_TreasuryStockValue
Retained earnings	685	645
Accumulated other comprehensive loss	(1,870)	(1,879)
Total shareholders’ equity	1,310us-gaap_StockholdersEquity	1,247us-gaap_StockholdersEquity
Total liabilities and shareholders’ equity	$ 4,831	$ 4,878