Financial Performance - Net sales for the three months ended June 29, 2024, were $904.735 million, a 6.4% increase from $850.176 million for the same period last year[6]. - Gross profit for the nine months ended June 29, 2024, was $751.440 million, up 16.0% from $647.634 million in the prior year[6]. - Net earnings for the three months ended June 29, 2024, were $56.360 million, representing a 33.3% increase from $42.387 million in the same quarter of the previous year[6]. - The company reported a diluted earnings per share of $1.74 for the three months ended June 29, 2024, compared to $1.32 for the same period last year, marking a 31.6% increase[6]. - Net earnings for the nine months ended June 29, 2024, were $164,175,000, compared to $131,416,000 for the same period in 2023, representing a year-over-year increase of approximately 25%[15]. - The operating profit for the three months ended June 29, 2024, was $105.380 million, compared to $84.508 million for the same period in 2023, reflecting an increase of about 24.7%[105]. - The total net sales for the nine months ended June 29, 2024, were $2.691888 billion, compared to $2.447071 billion for the same period in 2023, reflecting an increase of about 10%[101]. Assets and Liabilities - Total current assets as of June 29, 2024, were $2.172 billion, an increase from $1.985 billion as of September 30, 2023[9]. - Total liabilities increased to $2.274 billion as of June 29, 2024, compared to $2.172 billion as of September 30, 2023[9]. - Shareholders' equity rose to $1.794 billion as of June 29, 2024, up from $1.636 billion as of September 30, 2023[9]. - The company’s cash and cash equivalents decreased to $50.572 million as of June 29, 2024, from $68.959 million as of September 30, 2023[9]. - Long-term debt increased to $958,127 as of June 29, 2024, from $863,092 as of September 30, 2023[70]. - Total assets increased to $4,067,748 thousand from $3,808,036 thousand, a growth of 6.8%[9]. Research and Development - Research and development expenses increased to $27.791 million for the three months ended June 29, 2024, compared to $26.502 million in the same period last year, reflecting a 4.8% rise[6]. - The total equity-based compensation expense for the nine months ended June 29, 2024, was $11,301,000, compared to $8,121,000 for the same period in 2023, reflecting a 39.5% increase[15]. Cash Flow and Investments - Cash flows from operating activities for the nine months ended June 29, 2024, were $46,555,000, a significant improvement from a cash outflow of $17,097,000 in the same period of 2023[15]. - The company incurred $109,616,000 in capital expenditures for the purchase of property, plant, and equipment during the nine months ended June 29, 2024[15]. - The company experienced a net cash outflow from investing activities of $114,546,000, slightly higher than the $113,895,000 outflow in the previous year[15]. Market Segments - The Space and Defense segment generated net sales of $258.409 million for the three months ended June 29, 2024, up from $242.402 million in the prior year, indicating a growth of approximately 6.9%[101]. - The Military Aircraft segment reported an operating profit of $23.965 million for the three months ended June 29, 2024, compared to $18.143 million in the same period last year, marking an increase of about 32.1%[105]. - The U.S. Government customer type generated net sales of $178.636 million for the three months ended June 29, 2024, compared to $192.897 million in the same period of 2023, a decline of about 7.4%[103]. Future Outlook - Net sales for 2024 are projected to be $3,575 million, an increase of $256 million or 8% compared to 2023[147]. - Operating profit is expected to reach $421 million in 2024, up $78 million or 23% from 2023[147]. - Adjusted diluted earnings per share are forecasted to be between $7.30 and $7.50, with a midpoint of $7.40[147]. - The adjusted operating margin is anticipated to improve to 12.4% in 2024 from 10.9% in 2023[147]. Miscellaneous - The company recorded a foreign currency translation adjustment loss of $6.650 million for the three months ended June 29, 2024[7]. - The company declared a quarterly dividend of $0.28 per share, payable on August 29, 2024[111]. - The company expects to recognize a pre-tax loss from the sale of its hydraulic systems business in Luxembourg, which is anticipated to close in Q4 2024[111].

Financial Performance - Net sales for Q3 2024 reached $905 million, a 6% increase compared to $850 million in Q3 2023[2] - Adjusted diluted earnings per share rose to $1.91, a 39% increase from $1.37 in Q3 2023[3] - Net earnings for the three months ended June 29, 2024, were $56,360,000, compared to $42,387,000 for the same period in 2023, marking a 33.1% increase[13] - Diluted net earnings per share increased to $1.74 for the three months ended June 29, 2024, from $1.32 in the same period last year, a rise of 31.8%[13] - Net earnings for the nine months ended June 29, 2024, increased to $164,175 thousand, up from $131,416 thousand for the same period last year, representing a growth of approximately 25%[18] Operating Margin and Profit - Operating margin improved to 11.6%, up 170 basis points from 9.9% in the prior year[3] - The operating profit for the same period was $105,380,000, up from $84,508,000 in the prior year, reflecting a 24.7% increase[14] - The Space and Defense segment achieved an operating profit of $32,635,000 for the three months ended June 29, 2024, compared to $18,585,000 in the prior year, a growth of 75.7%[15] - The Military Aircraft segment's operating profit rose to $23,965,000 from $18,143,000, reflecting a 32.3% increase[15] - The Commercial Aircraft segment reported an operating profit of $24,367,000, up from $19,745,000, indicating a 23.4% increase[15] - The Industrial segment's operating profit decreased to $24,413,000 from $28,035,000, a decline of 13.4%[15] Sales Growth and Backlog - Military Aircraft sales increased by 18% to $207 million, driven by the ramp-up of the FLRAA program[4] - Space and Defense sales grew by 7% to $258 million, supported by strong U.S. and European defense demand[4] - Twelve-month backlog increased by 7% to $2.5 billion, reflecting strong product demand in aerospace and defense[6] - Fiscal year 2024 guidance projects an 8% sales growth, with adjusted operating margin expanding by 150 basis points[7] Cash Flow and Financial Position - Free cash flow improved by $17 million year-over-year, resulting in a cash use of $2 million in Q3 2024[6] - Free cash flow for the nine months ended June 29, 2024, was reported at $(63,061) thousand, compared to $(142,171) thousand for the same period last year, showing an improvement of approximately 56%[19] - The company reported a net cash provided by operating activities of $46,555 thousand for the nine months ended June 29, 2024, compared to $(17,097) thousand for the same period last year[19] Assets and Liabilities - Total assets as of September 30, 2023, were reported at $4,067,748,000, an increase from $3,808,036,000 year-over-year[16] - Total current liabilities rose to $988,404 thousand, compared to $965,473 thousand in the previous year, reflecting an increase of about 2%[17] - Total liabilities increased to $2,273,956 thousand from $2,171,949 thousand, marking a rise of approximately 5%[17] - Shareholders' equity grew to $1,793,792 thousand, up from $1,636,087 thousand, indicating an increase of around 10%[17] Future Projections - Adjusted diluted earnings per share for FY 2024 is expected to increase by 20% to $7.40[7] - Operating margin for FY 2024 is projected at 11.8%, slightly down from the previous estimate of 11.9%[7]

Financial Performance - Net sales for the three months ended March 30, 2024, were $930.3 million, a 11.2% increase from $836.8 million for the same period in 2023[10]. - Gross profit for the six months ended March 30, 2024, was $500.0 million, up 17.5% from $425.0 million in the prior year[10]. - Net earnings for the three months ended March 30, 2024, were $60.0 million, representing a 39.6% increase compared to $43.0 million for the same period in 2023[10]. - Basic net earnings per share for the three months ended March 30, 2024, were $1.88, up from $1.35 in the same period last year, reflecting a 39.1% increase[10]. - Net earnings for the six months ended March 30, 2024, were $107,815,000, an increase from $89,029,000 in the same period of 2023, representing a growth of approximately 21%[23]. - Total operating profit for the three months ended March 30, 2024, was $112,012 million, an increase of 34% compared to $83,766 million for the same period in 2023[110]. - Net sales for the quarter ended March 30, 2024, were $930 million, representing an 11% increase from $837 million in the same quarter of 2023[133]. - Diluted earnings per share rose to $1.86 for the quarter ended March 30, 2024, up 39% from $1.34 in the same quarter of 2023[133]. Assets and Liabilities - Total assets as of March 30, 2024, were $4.04 billion, an increase from $3.81 billion as of September 30, 2023[15]. - Total liabilities increased to $2.29 billion as of March 30, 2024, compared to $2.17 billion as of September 30, 2023[15]. - The company’s retained earnings increased to $2.59 billion as of March 30, 2024, up from $2.50 billion as of September 30, 2023[15]. - Cash and cash equivalents decreased to $59.1 million as of March 30, 2024, down from $69.0 million as of September 30, 2023[15]. - The company reported a net cash outflow from investing activities of $83,956,000 for the six months ended March 30, 2024, compared to $74,200,000 in the prior year[23]. - Long-term debt as of March 30, 2024, was $948,615 million, an increase from $863,092 million as of September 30, 2023, reflecting a growth of 9.9%[80]. Cash Flow and Dividends - Operating cash flow for the six months ended March 30, 2024, was $16,389,000, compared to a cash outflow of $33,016,000 in the prior year[23]. - The company reported a cash dividend of $0.28 per share for the three months ended March 30, 2024, compared to $0.27 per share for the same period in 2023[19]. - Net cash provided by operating activities increased by $16 million in the first half of 2024 compared to the same period in 2023, primarily due to improved accounts receivable[168]. Research and Development - Research and development expenses for the six months ended March 30, 2024, were $59.0 million, an increase from $50.6 million in the prior year[10]. - Research and development expenses for the quarter were $28 million, a 6% increase from $27 million in the same quarter of 2023[133]. - Research and development expenses rose by $11 million in the first half of 2024, driven by new growth programs in Space and Defense[135]. Segment Performance - The Space and Defense segment reported net sales of $266.8 million for the three months ended March 30, 2024, compared to $245.9 million in the same period of 2023, marking an increase of approximately 8.5%[107]. - The Military Aircraft segment generated net sales of $202.5 million for the three months ended March 30, 2024, up from $182.8 million in the same period of 2023, indicating a growth of about 10.0%[107]. - The Commercial Aircraft segment saw net sales of $207.6 million for the three months ended March 30, 2024, compared to $164.3 million in the same period of 2023, representing a significant increase of approximately 26.3%[107]. - Space and Defense net sales increased by 9% in Q2 2024, driven by higher demand for defense applications, with operating profit at $28 million[140]. - Military Aircraft net sales increased by 11% in Q2 2024, with OEM sales up $15 million and aftermarket sales up $5 million[145]. - Commercial Aircraft net sales increased by 26% in Q2 2024, with OEM sales up $29 million and aftermarket sales up $14 million[151]. Backlog and Future Projections - Twelve-month backlog increased to $2,500 million, a 9% rise from $2,300 million in the previous year[133]. - Net sales for 2024 are projected to be $3,550 million, a 7% increase from $3,319 million in 2023, with significant growth in Commercial Aircraft sales expected to rise by 23%[162]. - Operating profit is expected to increase to $422 million in 2024, up 23% from $343 million in 2023, driven by improvements in Space and Defense segments[162]. Impairments and Charges - The company recorded an impairment charge of $1,152 million related to the cancellation of the Future Attack Reconnaissance Aircraft program during the three months ended March 30, 2024[51]. - The company recorded $175 million in write-downs due to the cancellation of the FARA program during the three months ended March 30, 2024[59]. - Restructuring charges for 2024 included $2,293 for severance and $2,390 for other costs, totaling $4,683[96]. Market Conditions and Trends - The space market consists of three customer markets: civil, U.S. Department of Defense, and commercial, with increasing investments expected in satellite technologies and small satellites[200]. - The industrial market is influenced by capital investment levels, product innovation pace, and economic conditions, with challenges arising from changing customer demands[202]. - The energy generation and exploration market is affected by fluctuating oil and natural gas prices, global urbanization, and investments in power generation infrastructure[204]. - The medical market is driven by economic conditions, regulatory environments, and advances in medical technology, leading to increased demand for medical devices and components[205].

Financial Performance - Net sales for Q2 2024 reached $930 million, an 11% increase compared to $837 million in Q2 2023[4] - Diluted earnings per share for Q2 2024 were $1.86, a 39% increase from $1.34 in Q2 2023[4] - Adjusted diluted earnings per share rose to $2.19, reflecting a 54% increase from $1.42 in the same quarter last year[4] - Operating profit for the same period rose to $112.0 million, compared to $83.8 million in the prior year, reflecting a margin increase from 10.0% to 12.0%[20] - Net earnings for the three months ended March 30, 2024, were reported at $60.0 million, a significant increase from $43.0 million in the previous year, marking a growth of 39.6%[17] - Diluted net earnings per share for the three months ended March 30, 2024, increased to $1.86, up from $1.34 in the same quarter last year, representing a growth of 38.8%[17] - Net earnings for the six months ended March 30, 2024, increased to $107,815 thousand, up from $89,029 thousand in the same period last year, representing a growth of approximately 21%[25] Sales and Backlog - The twelve-month backlog increased by 9% to a record level of $2.5 billion, driven by growth in aerospace and defense sectors[8] - Commercial Aircraft sales surged by 26% to $208 million, attributed to growth in widebody aircraft[5] - The Space and Defense segment reported net sales of $266.8 million, an increase of 8.5% from $245.9 million in the prior year[20] - The Industrial segment's net sales reached $253.4 million, up from $243.9 million, indicating a growth of 3.9%[20] Cash Flow and Expenses - Free cash flow improved by $17 million year-over-year, with a cash use of $84 million in Q2 2024 compared to $101 million in Q2 2023[4] - Net cash provided by operating activities for the six months ended March 30, 2024, was $16,389 thousand, a significant improvement compared to a net cash used of $33,016 thousand in the prior year[25] - Free cash flow for the six months ended March 30, 2024, was $(61,141) thousand, an improvement from $(122,759) thousand in the same period last year, indicating a reduction in cash outflow[26] - The company reported a net cash used by investing activities of $83,956 thousand for the six months ended March 30, 2024, compared to $74,200 thousand in the same period last year, indicating an increase in cash outflow for investments[25] Margins and Profitability - Operating margin for Q2 2024 was 12.0%, up 200 basis points from 10.0% in Q2 2023[4] - Adjusted operating margin increased to 13.6%, a rise of 320 basis points compared to the previous year[4] - Adjusted operating profit for the three months ended March 30, 2024, was $126.4 million, compared to $87.1 million in the same period last year, indicating a margin of 13.6%[21] Assets and Liabilities - Total assets as of March 30, 2024, were $4.04 billion, an increase from $3.81 billion as of September 30, 2023[23] - The company's total liabilities increased to $2.29 billion from $2.17 billion, reflecting a rise in long-term debt to $948.6 million[23] Capital Expenditures and Dividends - Capital expenditures for Q2 2024 were reported at $40 million[8] - The company paid dividends totaling $17,572 thousand during the six months ended March 30, 2024, compared to $16,859 thousand in the same period last year, reflecting a year-over-year increase of approximately 4%[25] Tax and Depreciation - The effective income tax rate for the six months ended March 30, 2024, was reported at 23.7%, consistent with the previous year[17] - The company reported a depreciation expense of $42,276 thousand for the six months ended March 30, 2024, compared to $36,810 thousand in the prior year, reflecting an increase of approximately 15%[25] Acquisitions and Debt - The company made acquisitions of businesses totaling $5,911 thousand during the six months ended March 30, 2024, compared to no acquisitions in the same period last year[25] - Total payments on long-term debt were $188 thousand in the prior year, with no payments reported for the current period[25] - Proceeds from revolving lines of credit were $509,500 thousand for the six months ended March 30, 2024, slightly up from $503,232 thousand in the prior year[25]

Financial Performance - Net sales for the three months ended December 30, 2023, were $856,850,000, representing a 12.7% increase from $760,103,000 for the same period in 2022[11] - Gross profit increased to $233,199,000, up from $203,686,000, reflecting a gross margin improvement[11] - Net earnings for the quarter were $47,812,000, slightly up from $46,016,000, resulting in a diluted earnings per share of $1.48[11] - Comprehensive income for the three months ended December 30, 2023, was $80,821,000, down from $99,869,000 in the prior year[15] - Operating profit for the same period was $94.54 million, up 9.9% from $86.76 million year-over-year[106] - The net sales for the Defense segment increased to $130.52 million in the three months ended December 30, 2023, from $121.90 million in the same period of 2022, reflecting a growth of approximately 7.0%[104] - Net sales for the first quarter of 2024 were $857 million, an increase of $97 million or 13% compared to $760 million in the same period of 2023[129] Expenses and Investments - Research and development expenses rose to $30,579,000, compared to $23,862,000, indicating a 28.2% increase year-over-year[11] - The company incurred $5,212,000 in acquisitions of businesses during the quarter, with no cash acquired, indicating ongoing investment in growth[26] - The total expense for defined contribution plans for the three months ended December 30, 2023, was $14.35 million, up from $12.25 million in the same period of 2022[97] - Equity-based compensation expense rose to $4,165,000 from $2,974,000, indicating a strategic focus on incentivizing employee performance[26] Assets and Liabilities - Total assets increased to $3,987,955,000 from $3,808,036,000, marking a 4.7% growth[18] - Total liabilities rose to $2,280,738,000, compared to $2,171,949,000, reflecting a 5.0% increase[18] - Shareholders' equity increased to $1,707,217,000 from $1,636,087,000, showing a growth of 4.3%[18] - Cash and cash equivalents significantly increased to $126,398,000 from $68,959,000, indicating a strong liquidity position[18] Cash Flow and Dividends - Cash dividends declared were $0.27 per share for the quarter, up from $0.26 per share in the same period last year[21] - Net cash provided by operating activities was $60,391,000, significantly higher than $8,083,000 in the prior year, indicating a substantial increase in operational efficiency[26] - Cash collections from sold receivables under the Receivables Purchase Agreement totaled $123,827 for the three months ended December 30, 2023[58] Market and Segment Performance - Space and Defense segment generated an operating profit of $25.30 million, a 24.8% increase from $20.29 million in the prior year[106] - Military Aircraft segment's operating profit rose to $19.59 million, a 29.5% increase compared to $15.20 million in the previous year[106] - Commercial Aircraft segment reported an operating profit of $20.63 million, up 42.3% from $14.52 million year-over-year[106] - Aerospace and defense businesses represented 70% of the company's 2023 sales, with increased funding levels positively impacting the defense market[175] Future Outlook - The company expects total net sales for 2024 to reach $3,500 million, a 5% increase from $3,319 million in 2023, with significant growth anticipated in Space and Defense[147] - Adjusted diluted earnings per share for 2024 are projected to range between $6.70 and $7.10, with a midpoint of $6.90, reflecting anticipated higher sales and operating margins[147] - The company aims to improve shareholder value through strategic revenue growth and operational efficiencies, focusing on both organic growth and acquisitions[121] Risks and Challenges - The company is facing risks related to supply chain constraints and inflated prices for raw materials, which could impact manufacturing and shipping capabilities[192] - The defense market's future spending levels are expected to increase due to current global tensions, subject to governmental approval[179]

Financial Performance - Net sales for the fiscal year ended September 30, 2023, were $3,319.1 million, an increase of 9.4% from $3,035.8 million in the previous year[218]. - Gross profit for the same period was $891.5 million, representing a gross margin of 26.8%, up from $820.8 million and a margin of 27.0% in the prior year[218]. - Net earnings increased to $171.0 million, a rise of 10.5% compared to $155.2 million in the previous year[218]. - Basic net earnings per share rose to $5.37, up from $4.85, reflecting a 10.7% increase[218]. - Total assets as of September 30, 2023, were $3,808.0 million, compared to $3,431.8 million at the end of the previous fiscal year, marking a 10.9% increase[224]. - The company reported comprehensive income of $227.4 million for the fiscal year, significantly higher than $91.7 million in the prior year[220]. - Total shareholders' equity increased to $1,636,087,000 as of September 30, 2023, up from $1,436,813,000 a year earlier, representing a growth of 13.9%[226]. - Cash dividends per share were $1.07 for the fiscal year ended September 30, 2023, compared to $1.03 for the previous year, marking a 3.9% increase[227]. - Net cash provided by operating activities was $135,935,000 for the fiscal year ended September 30, 2023, a decrease from $246,802,000 in the prior year[232]. Backlog and Sales Composition - The twelve-month backlog as of September 30, 2023, was $2.4 billion, reflecting a 4% increase compared to October 1, 2022[17]. - As of September 30, 2023, the total backlog was $5.1 billion, representing confirmed orders expected to be recognized as revenue[63]. - Aerospace and defense OEM customers accounted for 58% of total sales in 2023, while industrial market sales represented 30%[42]. - Sales under U.S. Government contracts constituted 39% of total sales in 2023, primarily within Aircraft Controls and Space and Defense Controls segments[44]. - In 2023, sales under U.S. Government contracts represented 39% of total sales, while sales to foreign governments accounted for 8%[61]. - Net sales to the five largest customers represented approximately 32% of total sales in 2023[43]. - Aftermarket sales accounted for 13% of total sales in 2023[42]. - Sales to The Boeing Company constituted 11% of total sales in 2023, with a significant portion tied to government defense spending[62]. Research and Development - Research and development expenses were at least $107 million in each of the last three years, representing approximately 3% of sales in 2023[21]. - The company has incurred substantial expenses associated with research and development and innovation activities to maintain a leadership position in the high-performance, precision controls market[56]. - Research and development expenses for the fiscal year were $106.6 million, slightly down from $109.5 million in the previous year[218]. - Research and development costs are expensed as incurred, including salaries, benefits, consulting, material costs, depreciation, and amortization[242]. Employee and Workforce Management - The company hired over 2,000 new regular employees globally in 2023[25]. - The average voluntary attrition rate over the last five years was approximately 6%[33]. - The restructuring charge for 2023 was $6,905 for severance and $1,092 for facility closure, with potential additional costs of up to $11,000 through 2027[334]. - The restructuring accrual as of September 30, 2023, included $6,057 for the 2023 plan, indicating ongoing workforce adjustments[336]. Financial Liabilities and Assets - As of September 30, 2023, the company reported goodwill of $821 million and other intangible assets of $72 million, representing a significant portion of total assets of $3.8 billion[75]. - The company has a total long-term debt of $863,092 million as of September 30, 2023, compared to $836,872 million on October 1, 2022, an increase of approximately 3.1%[317]. - The weighted-average interest rate on outstanding credit facility borrowings is 6.93% as of September 30, 2023[317]. - The fair value of long-term debt was $812,693, compared to a carrying value of $867,500 as of September 30, 2023[332]. - Total accrued liabilities as of September 30, 2023, amounted to $211,769, a decrease of 1.4% from $215,376 on October 1, 2022[322]. Risks and Challenges - The company experienced supply chain constraints and inflated prices for raw materials, impacting manufacturing and operating profit[64]. - Future levels of defense spending are uncertain and subject to congressional debate, which could adversely impact sales and operating profit[61]. - The company faces risks from competitors with greater resources, which may impact sales and operating margins[55]. - The company relies on subcontractors and suppliers for manufacturing, which poses risks to contract performance and future business opportunities[65]. - The company faces potential liabilities from product defects, which could lead to recalls and significant damages, impacting financial results and reputation[69]. - The invalidation of the facility security clearance by the DCSA could hinder the company's ability to bid on classified contracts, affecting future business opportunities[83]. - The company is exposed to risks from foreign operations, including currency fluctuations and changes in trade policies, which could negatively impact financial results[78]. Environmental and Governance - The company is assessing its environmental, social, and governance impact across 25 countries to establish sustainability goals[39]. - Compliance with environmental laws may require significant capital expenditures, impacting operational costs[81]. - The company may incur additional costs to meet increased cybersecurity standards, which could affect financial results[67]. Inventory and Contract Management - The company recorded impairment charges on long-lived assets and inventory write-downs in 2023 due to a decline in value related to specific contracts and equipment[253]. - The company recorded $4,345 in inventory write-downs in 2023 due to a decline in business in the Industrial Systems segment[297]. - Unbilled recoverable costs and accrued profits for over-time contracts to the U.S. Government increased to $79,388 as of September 30, 2023, from $38,020 on October 1, 2022, reflecting a growth of 108.5%[278]. - Total contract assets rose to $706,601 as of September 30, 2023, compared to $614,760 on October 1, 2022, marking an increase of 14.9%[279]. - Contract liabilities include payments received in advance of the satisfaction of performance obligations, recorded until obligations are fulfilled[276].

Financial Performance - Net sales for the three months ended July 1, 2023, were $850,176 thousand, a 10% increase from $772,911 thousand for the same period in 2022[11] - Gross profit for the nine months ended July 1, 2023, was $647,634 thousand, up from $617,635 thousand in the prior year, reflecting a 4.9% increase[11] - Net earnings for the three months ended July 1, 2023, were $42,387 thousand, a decrease of 16% compared to $50,409 thousand for the same period in 2022[11] - Net earnings for the nine months ended July 1, 2023, were $131,416,000, compared to $125,761,000 for the same period in 2022, representing an increase of 5.2%[24] - Operating profit for the three months ended July 1, 2023, was $84.5 million, compared to $79.3 million for the same period in 2022, reflecting an increase of 6.9%[104] - Total operating profit for the nine months ended July 1, 2023, was $255.0 million, compared to $216.9 million for the same period in 2022, an increase of 17.5%[104] - Diluted earnings per share for the quarter were $1.32, down from $1.57 in the same quarter of 2022, reflecting a 16% decline[128] Cash Flow and Investments - Cash flows from operating activities for the nine months ended July 1, 2023, were $(17,097,000), a significant decrease from $184,264,000 in the prior year[24] - The company reported a net cash used by investing activities of $(113,895,000) for the nine months ended July 1, 2023, compared to $(85,267,000) in the prior year[24] - Net cash used by operating activities was $(17) million in the first three quarters of 2023, a decrease of $201 million compared to $184 million provided in the same period of 2022[158] - Capital expenditures in the first three quarters of 2023 amounted to $125 million, including a $28 million building purchase[161] - Net cash provided by financing activities in the first three quarters of 2023 included $175 million of net borrowings on credit facilities, offset by $25 million in cash for dividend payments[164] Assets and Liabilities - Total assets increased to $3,882,243 thousand as of July 1, 2023, compared to $3,431,841 thousand as of October 1, 2022, representing a growth of 13.1%[17] - Total shareholders' equity increased to $1,621,184 thousand as of July 1, 2023, from $1,436,813 thousand a year earlier, reflecting a growth of 12.8%[17] - Long-term debt increased to $1,012,080 million as of July 1, 2023, from $836,872 million as of October 1, 2022[77] - Other accrued liabilities totaled $206,903 million as of July 1, 2023, a decrease from $215,376 million as of October 1, 2022[81] Research and Development - Research and development expenses for the nine months ended July 1, 2023, totaled $77,107 thousand, down from $84,318 thousand in the previous year, indicating a 8.5% reduction[11] - Research and development expenses were $27 million for the quarter, a slight increase of 2% from $26 million in the same quarter of 2022[128] Dividends and Shareholder Returns - Cash dividends declared were $0.27 per share for the three months ended July 1, 2023, compared to $0.26 per share for the same period in 2022[20] - The company maintains a share repurchase program allowing for the buyback of up to 3 million common shares, with approximately 2.2 million shares remaining[180] Market and Segment Performance - The Aircraft Controls segment reported net sales of $355.0 million for the three months ended July 1, 2023, compared to $318.0 million in the same period of 2022, marking a growth of 11.6%[103] - The Space and Defense Controls segment's net sales increased to $242.4 million for the three months ended July 1, 2023, from $223.6 million in the same period of 2022, a rise of 8.1%[103] - The Industrial Systems segment achieved net sales of $252.7 million for the three months ended July 1, 2023, compared to $231.3 million in the same period of 2022, indicating an increase of 9.3%[103] Risks and Challenges - The company operates in highly competitive markets, facing risks from competitors with greater resources[204] - Significant reliance on government contracts, which may not be fully funded or could be terminated, potentially reducing sales and increasing costs[204] - Supply chain issues, including reduced supply and inflated prices of raw materials, could materially affect manufacturing and shipping capabilities[204] - Risks related to health pandemics, such as COVID-19, have had material adverse consequences on operations and financial position[204] - The company may not realize the full amounts reflected in its backlog as revenue, affecting future revenue and growth prospects[204]

Financial Performance - Net sales for the three months ended April 1, 2023, were $836,792 thousand, a 8.5% increase from $770,787 thousand for the same period in 2022[11] - Gross profit for the six months ended April 1, 2023, was $425,001 thousand, compared to $405,892 thousand for the same period in 2022, reflecting a 4.7% increase[11] - Net earnings for the three months ended April 1, 2023, were $43,013 thousand, a 47.9% increase from $29,087 thousand for the same period in 2022[11] - Basic net earnings per share for the six months ended April 1, 2023, were $2.80, up from $2.35 for the same period in 2022, representing a 19.1% increase[11] - Net earnings for the six months ended April 1, 2023, were $89,029 thousand, an increase from $75,352 thousand in the same period of 2022, representing a growth of approximately 18%[23] - Operating profit for the three months ended April 1, 2023, was $83.8 million, compared to $57.2 million for the same period in 2022, reflecting a growth of approximately 46.5%[101] - The company reported a comprehensive income of $57,669 thousand for the three months ended April 1, 2023, compared to $15,047 thousand for the same period in 2022[13] Assets and Liabilities - Total assets as of April 1, 2023, were $3,699,609 thousand, an increase from $3,431,841 thousand as of October 1, 2022[16] - Total shareholders' equity increased to $1,579,777 thousand as of April 1, 2023, from $1,436,813 thousand as of October 1, 2022[16] - Total long-term debt as of April 1, 2023, was $958,414 million, up from $836,872 million on October 1, 2022, representing an increase of 14.5%[76] - Cash and cash equivalents increased to $107,012 thousand as of April 1, 2023, compared to $103,895 thousand as of October 1, 2022[16] Cash Flow and Investments - Cash flows from operating activities for the six months ended April 1, 2023, showed a net cash used of $33,016 thousand, compared to a net cash provided of $180,197 thousand in the same period of 2022[23] - The company reported a net cash used by investing activities of $74,200 thousand for the six months ended April 1, 2023, compared to $48,148 thousand in the same period of 2022[23] - The company purchased property, plant, and equipment for $89,743 thousand during the six months ended April 1, 2023, an increase from $74,087 thousand in the same period of 2022[23] - Net cash used by investing activities in the first half of 2023 included $90 million in capital expenditures, with an expectation of $165 million for the full year[159][160] Revenue Recognition and Contracts - The company recognized revenue using the five-step model prescribed in ASC 606, focusing on identifying contracts and performance obligations[32] - As of April 1, 2023, the company had contract reserves of $45,602, with provisions for anticipated losses charged against income when known[42] - The aggregate amount of transaction price allocated to unsatisfied performance obligations was $5,200,000, with an expected 44% to be recognized as sales over the next twelve months[46] Segment Performance - The Aircraft Controls segment reported an operating profit of $31.9 million for the three months ended April 1, 2023, significantly higher than $12.4 million in the same period of 2022, indicating a year-over-year increase of approximately 156.5%[101] - The Space and Defense Controls segment achieved net sales of $245.9 million for the three months ended April 1, 2023, compared to $223.3 million in the same period of 2022, marking an increase of approximately 10.1%[100] - The Industrial Systems segment's net sales reached $243.9 million for the three months ended April 1, 2023, up from $236.2 million in the same period of 2022, reflecting a growth of approximately 3.2%[100] Expenses - Research and development expenses for the three months ended April 1, 2023, were $26,743 thousand, down from $30,720 thousand for the same period in 2022[11] - Selling, general and administrative expenses increased to $116,695 thousand for the three months ended April 1, 2023, compared to $111,019 thousand in the same period of 2022, an increase of 5.2%[11] - Interest expenses increased to $14,963 thousand for the three months ended April 1, 2023, compared to $8,263 thousand in the same period of 2022, a rise of 81.5%[11] Shareholder Returns - The company declared cash dividends of $0.27 per share for the three months ended April 1, 2023, compared to $0.26 per share for the same period in 2022[19] - The company aims to improve shareholder value through strategic revenue growth and operational efficiencies[116] Risks and Challenges - The company reported a backlog that may not fully convert to revenue, which could adversely affect future revenue and growth prospects[200] - The company faces significant operational risks related to supply chain disruptions and health pandemics, which could materially impact financial performance[201] - The company is heavily reliant on government contracts, and any funding issues could reduce sales and increase costs[200]

PART I [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) Q1 FY23 financial statements show 5% net sales growth to $760.1 million, stable net earnings, increased assets to $3.66 billion, and operating cash flow significantly declined to $8.1 million [Consolidated Condensed Statements of Earnings](index=4&type=section&id=Consolidated%20Condensed%20Statements%20of%20Earnings) Net sales for Q1 FY23 increased 5.0% to $760.1 million, with gross profit rising to $203.7 million, while net earnings remained flat at $46.0 million due to higher interest expenses and the absence of a prior-year large business sale gain Consolidated Earnings Summary (Q1 FY23 vs Q1 FY22) | Financial Metric | Three Months Ended Dec 31, 2022 (in thousands) | Three Months Ended Jan 1, 2022 (in thousands) | | :--- | :--- | :--- | | Net sales | $760,103 | $724,086 | | Gross profit | $203,686 | $192,880 | | Earnings before income taxes | $60,301 | $61,423 | | Net earnings | $46,016 | $46,265 | | Diluted EPS ($) | $1.44 | $1.44 | - A **$9.5 million** gain on building sales was recorded, contrasting with a **$16.1 million** gain on business sales in the prior-year quarter[10](index=10&type=chunk) [Consolidated Condensed Statements of Comprehensive Income](index=5&type=section&id=Consolidated%20Condensed%20Statements%20of%20Comprehensive%20Income) Comprehensive income for the quarter was $99.9 million, a significant increase from $43.9 million in the prior-year period, primarily driven by a $50.7 million positive foreign currency translation adjustment, contrasting with a $6.6 million loss in the same quarter last year Comprehensive Income Summary (Q1 FY23 vs Q1 FY22) | Metric (in thousands) | Three Months Ended Dec 31, 2022 | Three Months Ended Jan 1, 2022 | | :--- | :--- | :--- | | Net earnings | $46,016 | $46,265 | | Foreign currency translation adjustment | $50,735 | $(6,560) | | **Comprehensive income** | **$99,869** | **$43,930** | [Consolidated Condensed Balance Sheets](index=6&type=section&id=Consolidated%20Condensed%20Balance%20Sheets) As of December 31, 2022, total assets stood at $3.66 billion, up from $3.43 billion at October 1, 2022, driven by higher receivables (up $76 million) and inventories (up $60 million), while total liabilities increased to $2.13 billion from $2.00 billion, mainly due to a rise in long-term debt and contract advances Balance Sheet Summary | Metric (in thousands) | December 31, 2022 | October 1, 2022 | | :--- | :--- | :--- | | Total current assets | $1,933,183 | $1,758,310 | | Total assets | $3,658,045 | $3,431,841 | | Total current liabilities | $885,666 | $838,436 | | Long-term debt | $916,058 | $836,872 | | Total liabilities | $2,132,864 | $1,995,028 | | Total shareholders' equity | $1,525,181 | $1,436,813 | [Consolidated Condensed Statements of Cash Flows](index=9&type=section&id=Consolidated%20Condensed%20Statements%20of%20Cash%20Flows) Net cash from operating activities was $8.1 million, a sharp decline from $157.2 million in the prior-year quarter, primarily due to increased cash usage for receivables and inventories, while investing activities used $25.3 million, and financing activities provided $59.4 million, driven by net borrowings on credit facilities Cash Flow Summary (Q1 FY23 vs Q1 FY22) | Cash Flow Activity (in thousands) | Three Months Ended Dec 31, 2022 | Three Months Ended Jan 1, 2022 | | :--- | :--- | :--- | | Net cash provided by operating activities | $8,083 | $157,185 | | Net cash provided (used) by investing activities | $(25,293) | $277 | | Net cash provided (used) by financing activities | $59,396 | $(151,585) | | **Increase in cash, cash equivalents and restricted cash** | **$46,678** | **$5,812** | [Notes to Consolidated Condensed Financial Statements](index=10&type=section&id=Notes%20to%20Consolidated%20Condensed%20Financial%20Statements) Key notes detail the company's revenue recognition policies, recent acquisitions and divestitures, debt structure, and segment performance, with revenue recognized over time for 63% of sales, total debt increased, and sales growth across all three segments, notably in Industrial Systems' operating profit - As of December 31, 2022, the company had remaining performance obligations of **$5.2 billion**, with **44%** expected to be recognized as sales over the next twelve months[45](index=45&type=chunk) - The company sold a sonar business, a security business, and its NAVAIDS business in fiscal 2022, impacting year-over-year comparisons[48](index=48&type=chunk)[49](index=49&type=chunk)[50](index=50&type=chunk) - On October 27, 2022, the company amended its U.S. revolving credit facility, extending maturity to October 27, 2027, and increasing capacity to **$1.1 billion**[75](index=75&type=chunk) - On February 2, 2023, the company declared a quarterly dividend of **$0.27 per share**, an increase from the prior rate[103](index=103&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=30&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes the 5% Q1 sales growth to increases across all segments, despite negative foreign currency impacts and divestitures, with gross margin improving slightly, Industrial Systems' operating profit more than doubling, and the company forecasting 5% sales growth for FY23 to $3.175 billion and diluted EPS of $5.89, while maintaining strong liquidity despite lower operating cash flow [Consolidated Results of Operations](index=33&type=section&id=Consolidated%20Results%20of%20Operations) Consolidated net sales for Q1 2023 increased 5% to $760 million, driven by growth in all segments, with gross margin at 26.8%, interest expense up 65%, net earnings flat at $46 million, diluted EPS unchanged at $1.44, and the twelve-month backlog growing 8% to $2.34 billion Q1 FY23 vs Q1 FY22 Performance | Metric | Q1 2023 | Q1 2022 | % Variance | | :--- | :--- | :--- | :--- | | Net sales (M) | $760 | $724 | 5% | | Gross margin | 26.8% | 26.6% | - | | Interest expense (M) | $13 | $8 | 65% | | Net earnings (M) | $46 | $46 | (1%) | | Diluted EPS ($) | $1.44 | $1.44 | 0% | | Twelve-month backlog (M) | $2,343 | $2,167 | 8% | - Excluding a **$17 million** negative impact from foreign currency and a **$12 million** impact from divestitures, sales growth was **9%**[121](index=121&type=chunk) [Segment Results of Operations](index=34&type=section&id=Segment%20Results%20of%20Operations) In Q1 2023, Aircraft Controls sales grew 2% to $310 million, Space and Defense Controls sales rose 5% to $218 million, and Industrial Systems sales increased 9% to $232 million, with operating profit falling in Aircraft Controls and Space and Defense, but surging 114% in Industrial Systems due to a building sale and higher volumes Q1 FY23 Segment Performance | Segment | Net Sales (Q1'23, M) | YoY Sales Change | Operating Profit (Q1'23, M) | YoY Profit Change | | :--- | :--- | :--- | :--- | :--- | | Aircraft Controls | $310 | +2% | $30 | -29% | | Space and Defense Controls | $218 | +5% | $20 | -5% | | Industrial Systems | $232 | +9% | $37 | +114% | - Aircraft Controls' operating margin was **9.6%**, but adjusted margin was higher than the prior year's **8.5%** when excluding a **$16 million** gain from the NAVAIDS divestiture in Q1 2022[130](index=130&type=chunk) - Industrial Systems' operating margin was **15.8%**, but adjusted margin was **12.3%** after excluding a **$10 million** gain on building sales and **$1 million** in restructuring charges[137](index=137&type=chunk) [Consolidated Segment Outlook](index=37&type=section&id=Consolidated%20Segment%20Outlook) For fiscal year 2023, the company projects total net sales of $3.175 billion, a 5% increase, with operating profit expected to rise 26% to $356 million, operating margin expanding to 11.2%, and full-year diluted EPS forecasted at $5.89, with Industrial Systems anticipating the largest percentage increase in operating profit Fiscal Year 2023 Outlook | Metric | 2023 Outlook (M) | 2022 Actual (M) | % Variance | | :--- | :--- | :--- | :--- | | Net Sales | $3,175 | $3,036 | 5% | | Operating Profit | $356 | $283 | 26% | | Operating Margin | 11.2% | 9.3% | - | | Diluted EPS ($) | $5.89 | $4.83 | - | - The company expects adjusted diluted EPS to range between **$5.50** and **$5.90**, with a midpoint of **$5.70**[139](index=139&type=chunk) [Liquidity and Capital Resources](index=38&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity remains robust with **$709 million** of unused borrowing capacity as of December 31, 2022, despite operating cash flow significantly decreasing to **$8 million** in Q1 2023 from **$157 million** in the prior year, mainly due to a **$90 million** prior-year receivables program benefit and **$52 million** greater inventory investment, with full-year 2023 cash from operations expected at **$250 million** and capital expenditures at **$150 million** - Operating cash flow decreased by **$149 million** YoY, primarily due to a prior-year benefit from the Receivables Purchase Agreement (RPA) program and increased inventory investment due to supply chain constraints[143](index=143&type=chunk)[144](index=144&type=chunk) - The company is in compliance with all debt covenants, with a leverage ratio that allows for an additional **$659 million** in net debt[160](index=160&type=chunk) - The Board has authorized a share repurchase program with approximately **2.2 million shares** remaining for repurchase[164](index=164&type=chunk) [Economic Conditions and Market Trends](index=41&type=section&id=Economic%20Conditions%20and%20Market%20Trends) The company operates in varying market conditions, with the defense market stable and potentially increasing due to global tensions, the commercial aircraft market recovering but facing prolonged international travel pressure, and industrial markets experiencing demand but constrained by supply chain issues, all demanding technologically advanced products - Defense market (part of the **70%** of sales from aerospace & defense) is stable and could see increased spending due to global tensions[170](index=170&type=chunk)[174](index=174&type=chunk) - The commercial aircraft market recovery is heavily dependent on the return of global international air traffic, which is expected to face prolonged pressure[175](index=175&type=chunk) - Industrial markets (**30%** of 2022 sales) are experiencing recovering demand but are constrained by supply chain issues[171](index=171&type=chunk)[179](index=179&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=44&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company states that there have been no material changes in its market risk information from what was disclosed in its Annual Report on Form 10-K for the fiscal year ended October 1, 2022 - There have been no material changes in the company's market risk disclosures during the current year[193](index=193&type=chunk) [Controls and Procedures](index=44&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of December 31, 2022, with no material changes in internal control over financial reporting during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures are effective as of the end of the quarter[195](index=195&type=chunk) - No material changes to internal control over financial reporting occurred during the most recent fiscal quarter[195](index=195&type=chunk) PART II OTHER INFORMATION [Risk Factors](index=45&type=section&id=Item%201A.%20Risk%20Factors) The company reports no material changes to its risk factors from those disclosed in its Annual Report on Form 10-K for the fiscal year ended October 1, 2022 - There have been no material changes in the company's risk factors during the current year[196](index=196&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=45&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During the quarter ended December 31, 2022, the company purchased a total of **152,691 shares** of its common stock at an average price of **$79.90 per share**, including **71,849 shares** under its publicly announced repurchase program, with approximately **2.2 million shares** remaining authorized for repurchase Share Repurchase Summary (Q1 FY23) | Period | Total Shares Purchased | Average Price Paid Per Share ($) | Shares Purchased Under Program | | :--- | :--- | :--- | :--- | | Oct 2 - Oct 29, 2022 | 81,981 | $75.03 | 71,849 | | Oct 30 - Dec 3, 2022 | 67,698 | $85.41 | 0 | | Dec 4 - Dec 31, 2022 | 3,012 | $88.32 | 0 | | **Total** | **152,691** | **$79.90** | **71,849** | - At the end of the quarter, **2,198,081 shares** may yet be purchased under the company's publicly announced share repurchase program[198](index=198&type=chunk)[199](index=199&type=chunk) [Exhibits](index=46&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including a form of the Restricted Stock Unit Award, certifications by the CEO and CFO as required by the Sarbanes-Oxley Act, and Interactive Data Files (XBRL)

Financial Performance - Net sales for the three months ended July 2, 2022, were $772,911 thousand, an increase of 9.2% compared to $707,352 thousand for the same period in 2021[11] - Gross profit for the three months ended July 2, 2022, was $211,743 thousand, representing a gross margin of 27.4%, up from $190,602 thousand in the prior year[11] - Net earnings for the three months ended July 2, 2022, were $50,409 thousand, a 39.5% increase from $36,122 thousand in the prior year[11] - Basic net earnings per share increased to $1.58 for the three months ended July 2, 2022, compared to $1.12 for the same period in 2021[11] - Operating profit for the three months ended July 2, 2022, was $79.3 million, compared to $64.9 million for the same period in 2021, reflecting an increase of about 22.1%[103] - The company’s total operating profit for the nine months ended July 2, 2022, was $216.9 million, compared to $208.2 million for the same period in 2021, showing a growth of about 4.0%[103] Assets and Liabilities - Total assets as of July 2, 2022, were $3,439,056 thousand, slightly up from $3,433,169 thousand as of October 2, 2021[17] - Total liabilities decreased to $2,007,631 thousand as of July 2, 2022, from $2,033,025 thousand as of October 2, 2021[17] - Shareholders' equity increased to $1,431,425 thousand as of July 2, 2022, compared to $1,400,144 thousand as of October 2, 2021[17] Cash Flow and Investments - Net cash provided by operating activities for the nine months ended July 2, 2022, was $184,264,000, down from $230,580,000 in the prior year, indicating a decrease of about 20%[24] - The company reported a net cash used by investing activities of $85,267,000 for the nine months ended July 2, 2022, compared to $162,558,000 in the prior year, reflecting a reduction of about 47.5%[24] - Cash, cash equivalents, and restricted cash at the end of the period were $95,864,000, compared to $91,658,000 at the end of the same period in 2021, showing an increase of approximately 4.8%[24] Research and Development - Research and development expenses decreased to $25,890 thousand for the three months ended July 2, 2022, down 21.8% from $33,095 thousand in the same period of 2021[11] - Research and development expenses decreased by 22% to $26 million in the third quarter of 2022 compared to $33 million in the same quarter of 2021[130] Foreign Currency and Market Impact - The company reported a foreign currency translation adjustment loss of $43,954 thousand for the three months ended July 2, 2022[14] - The company experienced a $15 million decrease in sales due to weaker foreign currencies, primarily the Euro and British Pound, relative to the U.S. Dollar[128] - The company experienced a decrease in sales of $24 million due to the weakening of foreign currencies against the U.S. dollar during the first nine months of 2022[194] Acquisitions and Growth - The company acquired TEAM Accessories Limited for a purchase price of $14,890, enhancing its Aircraft Controls segment[49] - The company acquired TEAM Accessories Limited for a purchase price of $15 million on February 21, 2022, enhancing its Aircraft Controls segment[120] - The company plans to continue exploring strategic acquisitions and return capital to shareholders to enhance long-term value[118] Backlog and Future Sales - The twelve-month backlog increased to $2.2 billion as of July 2, 2022, a 10% increase from $2.0 billion a year earlier[134] - The company expects total net sales for 2022 to reach $3,035 million, an increase of 6% from $2,852 million in 2021[153] - Aircraft Controls anticipates an increase in sales driven by recoveries in commercial OEM and aftermarket programs, despite a decline in military sales[154] - Space and Defense Controls expects sales growth in both defense and space markets, primarily from the RIwP program and integrated space vehicles business[155] - Industrial Systems forecasts a modest sales increase in 2022, particularly in the simulation and test market, but expects a decrease in operating margin due to ongoing portfolio shaping activities[156] Operational Risks and Legal Proceedings - The company faced operational risks due to potential interruptions in information systems and issues with product manufacturing processes[199] - The company is involved in various legal proceedings that could have unfavorable outcomes impacting financial results[201] Tax and Pension Expenses - The effective tax rate for the three months ended July 2, 2022, was 15.7%, lower than the U.S. federal statutory tax rate of 21% due to beneficial provisions related to the U.S. research and development tax credit[95] - The company reported a pension expense of $12,552 million for U.S. defined contribution plans for the three months ended July 2, 2022, compared to $11,195 million for the same period in 2021[94] Impairments and Restructuring - The company recorded impairment charges on long-lived assets in the Aircraft Controls segment due to a slower than expected recovery in the commercial aircraft business[29] - The company recorded impairment charges on inventory totaling $1,907 for the nine months ended July 2, 2022, associated with Russian actions in Ukraine[62] - The restructuring charge for 2022 included non-cash charges of $1,500 million for inventory write-downs and $7,423 million for severance related to businesses no longer pursued[93]