Raytheon Co., adjustments to financial statements

US$ in millions

	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015
Adjustment to Total Assets
Total assets (as reported)	34,566)	31,864)	30,860)	30,052)	29,281)
Less: Goodwill	14,882)	14,864)	14,871)	14,788)	14,731)
Total assets (adjusted)	19,684)	17,000)	15,989)	15,264)	14,550)
Adjustment to Total Raytheon Company Stockholders’ Equity
Total Raytheon Company stockholders’ equity (as reported)	12,223)	11,472)	9,963)	10,066)	10,128)
Less: Goodwill	14,882)	14,864)	14,871)	14,788)	14,731)
Total Raytheon Company stockholders’ equity (adjusted)	(2,659)	(3,392)	(4,908)	(4,722)	(4,603)

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Raytheon Co., adjusted financial ratios

	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015
Total Asset Turnover
Reported total asset turnover	0.84	0.85	0.82	0.80	0.79
Adjusted total asset turnover	1.48	1.59	1.59	1.58	1.60
Financial Leverage
Reported financial leverage	2.83	2.78	3.10	2.99	2.89
Adjusted financial leverage	—	—	—	—	—
Return on Equity (ROE)
Reported ROE	27.35%	25.36%	20.32%	21.97%	20.48%
Adjusted ROE	—	—	—	—	—
Return on Assets (ROA)
Reported ROA	9.67%	9.13%	6.56%	7.36%	7.08%
Adjusted ROA	16.98%	17.11%	12.66%	14.49%	14.25%

Financial ratio	Description	The company
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Raytheon Co. adjusted total asset turnover ratio improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019.
Adjusted ROA	A profitability ratio calculated as net income divided by adjusted total assets.	Raytheon Co. adjusted ROA improved from 2017 to 2018 but then slightly deteriorated from 2018 to 2019.

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	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015
As Reported
Selected Financial Data (US$ in millions)
Net sales	29,176)	27,058)	25,348)	24,069)	23,247)
Total assets	34,566)	31,864)	30,860)	30,052)	29,281)
Activity Ratio
Total asset turnover¹	0.84	0.85	0.82	0.80	0.79
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net sales	29,176)	27,058)	25,348)	24,069)	23,247)
Adjusted total assets	19,684)	17,000)	15,989)	15,264)	14,550)
Activity Ratio
Adjusted total asset turnover²	1.48	1.59	1.59	1.58	1.60

2019 Calculations

¹ Total asset turnover = Net sales ÷ Total assets
= 29,176 ÷ 34,566 = 0.84

² Adjusted total asset turnover = Net sales ÷ Adjusted total assets
= 29,176 ÷ 19,684 = 1.48

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Activity ratio	Description	The company
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Raytheon Co. adjusted total asset turnover ratio improved from 2017 to 2018 but then deteriorated significantly from 2018 to 2019.

	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015
As Reported
Selected Financial Data (US$ in millions)
Total assets	34,566)	31,864)	30,860)	30,052)	29,281)
Total Raytheon Company stockholders’ equity	12,223)	11,472)	9,963)	10,066)	10,128)
Solvency Ratio
Financial leverage¹	2.83	2.78	3.10	2.99	2.89
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Adjusted total assets	19,684)	17,000)	15,989)	15,264)	14,550)
Adjusted total Raytheon Company stockholders’ equity	(2,659)	(3,392)	(4,908)	(4,722)	(4,603)
Solvency Ratio
Adjusted financial leverage²	—	—	—	—	—

2019 Calculations

¹ Financial leverage = Total assets ÷ Total Raytheon Company stockholders’ equity
= 34,566 ÷ 12,223 = 2.83

² Adjusted financial leverage = Adjusted total assets ÷ Adjusted total Raytheon Company stockholders’ equity
= 19,684 ÷ -2,659 = —

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	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015
As Reported
Selected Financial Data (US$ in millions)
Net income attributable to Raytheon Company	3,343)	2,909)	2,024)	2,211)	2,074)
Total Raytheon Company stockholders’ equity	12,223)	11,472)	9,963)	10,066)	10,128)
Profitability Ratio
ROE¹	27.35%	25.36%	20.32%	21.97%	20.48%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net income attributable to Raytheon Company	3,343)	2,909)	2,024)	2,211)	2,074)
Adjusted total Raytheon Company stockholders’ equity	(2,659)	(3,392)	(4,908)	(4,722)	(4,603)
Profitability Ratio
Adjusted ROE²	—	—	—	—	—

2019 Calculations

¹ ROE = 100 × Net income attributable to Raytheon Company ÷ Total Raytheon Company stockholders’ equity
= 100 × 3,343 ÷ 12,223 = 27.35%

² Adjusted ROE = 100 × Net income attributable to Raytheon Company ÷ Adjusted total Raytheon Company stockholders’ equity
= 100 × 3,343 ÷ -2,659 = —

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	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015
As Reported
Selected Financial Data (US$ in millions)
Net income attributable to Raytheon Company	3,343)	2,909)	2,024)	2,211)	2,074)
Total assets	34,566)	31,864)	30,860)	30,052)	29,281)
Profitability Ratio
ROA¹	9.67%	9.13%	6.56%	7.36%	7.08%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net income attributable to Raytheon Company	3,343)	2,909)	2,024)	2,211)	2,074)
Adjusted total assets	19,684)	17,000)	15,989)	15,264)	14,550)
Profitability Ratio
Adjusted ROA²	16.98%	17.11%	12.66%	14.49%	14.25%

2019 Calculations

¹ ROA = 100 × Net income attributable to Raytheon Company ÷ Total assets
= 100 × 3,343 ÷ 34,566 = 9.67%

² Adjusted ROA = 100 × Net income attributable to Raytheon Company ÷ Adjusted total assets
= 100 × 3,343 ÷ 19,684 = 16.98%

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Profitability ratio	Description	The company
Adjusted ROA	A profitability ratio calculated as net income divided by adjusted total assets.	Raytheon Co. adjusted ROA improved from 2017 to 2018 but then slightly deteriorated from 2018 to 2019.

Raytheon Co. (NYSE:RTN)

Analysis of Goodwill and Intangible Assets