L3harris Technologies (LHX) Jefferies Global Industrial Conference summary

Financial framework and strategic outlook

• Targeting $23 billion revenue, 16% margins, and $2.8 billion free cash flow by 2026, with low-teens growth and mid-teens share repurchase growth expected.

• Portfolio aligned with future warfare, focusing on divestitures of non-core assets and strategic acquisitions, including two in 2023.

• Debt reduction to a 3x leverage ratio prioritized, with cash returns to shareholders planned.

• Leading positions in space, communications, munitions, and ISR, with resilient communications highlighted by lessons from Ukraine.

• Trusted disruptor strategy enables flexible roles as prime, subcontractor, or merchant supplier, maximizing win probability and content share.

Aerojet Rocketdyne integration and growth

• Integration ahead of schedule, exceeding $50 million synergy target, with investments in digitization and robotics.

• Overdue deliveries reduced by 40%, new orders booked, and selected for Next-Gen Interceptor program.

• Revenue expected to grow from $2.5 billion to $4 billion by decade's end, with capacity expansion underway.

• Margins projected to reach mid-teens, with disciplined contract negotiations to ensure profitability.

• High demand for munitions and missile defense, with Aerojet as one of two U.S. solid rocket motor manufacturers.

Communication systems and modernization

• Tactical communications business strong domestically and internationally, with a $10 billion international pipeline.

• Investments in factory throughput and outsourcing to increase capacity for military radios.

• Software-defined radios provide differentiation, with ongoing hardware and software cycles extending growth.

• Market share leadership in both U.S. and international markets, with modernization in night vision and broadband portfolios.

• Next-Gen Jammer program win represents a multi-billion-dollar opportunity, with cost-reimbursable development and future fixed-price production.