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RAYTHEON 'ON TRACT' WITH PLAN FOR FUTURE, SAYS CHAIRMAN

 LEXINGTON, Mass., May 26 /PRNewswire/ -- "Raytheon is performing well in difficult economic times and a very competitive marketplace, and we are on track with respect to our plan for the future," Dennis J. Picard, chairman and chief executive officer, told shareholders at the company's 65th annual meeting here today.
 That plan, he said, has four key goals:
 -- to stay strong in government electronics;
 -- to grow commercial sales and to grow commercial
 profitability so that it achieves parity with government
 electronics profits;
 -- to remain financially strong;
 -- to stay a most competitive company.
 The company is well positioned in defense electronics, Picard said, because it is involved in high priority areas, such as missile defense. "While the current defense budget has hurdles to clear, so far we are doing well."
 International orders are also helping Raytheon maintain its strong position in defense electronics, said Picard, pointing out that Raytheon has won nearly $2 billion in Patriot and Hawk contracts from Saudi Arabia and Kuwait since December 1992.
 Picard said he envisions a Raytheon of the future "that will derive 40 percent of its defense sales from outside the U.S." In 1992, approximately 20 percent of the company's defense sales were international.
 The Patriot missile system, Raytheon's largest defense program, is highly reliable and continues to be improved, said Picard. "Reliability out of the plant is currently 12 times specification. And we continue to make Patriot better. Since the end of Desert Storm, we have been awarded $355 million for upgrades to Patriot."
 The new Patriot PAC-3 multimode missile "will give Patriot a 20-fold improvement in defended area coverage on the ground" compared with the PAC-2 version used in Desert Storm.
 Raytheon's chairman also described ways in which Raytheon is transferring core defense technology into non-defense areas, such as air traffic control and vessel traffic control.
 Three new markets the company is pursuing with defense-based technology are: receiver and transmit modules for a satellite-based global communications system called Iridium; new transportation systems, such as intelligent vehicle highway systems, personal rapid transit, and magnetically levitated trains; and a wide area surveillance system to monitor natural resources, such as the Amazon basin in Brazil.
 Raytheon's commercial businesses, said Picard, last year "contributed a greater share to our total company profits." The company's five-year plan calls for roughly equal profits from government and commercial operations.
 Raytheon President Max E. Bleck reviewed with shareholders Raytheon's appliance, engineering and construction, and aircraft businesses.
 "By having established commercial companies with skilled and experienced people," Bleck said, "we are in the enviable position today of being able to concentrate on strengthening these businesses, not building them from scratch."
 Picard said that Raytheon's balance sheet "is extremely strong, giving us the flexibility to invest in our future."
 The company's debt decreased by 36 percent in 1992, and debt as a percentage of equity improved to 19 percent at year end, compared with 34.4 percent at the end of 1991.
 Raytheon has "worked very hard," said Picard, to remain strong and competitive. "We have improved schedule performance in manufacturing; we have reduced scrap; we have consolidated and centralized; we have streamlined our processes. Where required, and only where required, we have reduced employment levels."
 During the past 12 months, Raytheon's employment declined by 8,000 -- from 70,400 to 62,400. Of the total reduction, approximately 1,500 were due to the sale of several small non-core businesses, 1,900 to early retirement, 1,700 to attrition, and 2,900 to layoffs.
 "That is a painful process," said Picard, "but it is absolutely necessary to maintain the most jobs possible for our people in the future."
 Picard concluded, "Our vision for the future is a Raytheon where we continue to be a technology leader and a quality leader...where costs are low, efficiency is high, and integrity remains absolute.
 "... a Raytheon where our competitive position wins us the most contracts possible, earns us the most orders possible, and saves the most jobs possible for the people of Raytheon."
 At today's meeting, shareholders reelected four nominees to the board of directors: Ferdinand Colloredo-Mansfeld, Barbara B. Hauptfuhrer, Richard D. Hill, and Alfred M. Zeien. Picard announced that Harvey Brooks, a board member for 28 years, retired today.
 Headquartered in Lexington, Mass., Raytheon (NYSE: RTN) is a diversified technology company with sales in four business segments: Electronics, Aircraft Products, Energy and Environmental, and Major Appliances.
 In 1992, the company recorded sales of $9.1 billion and earnings of $635.1 million, Raytheon's eighth consecutive year of record earnings. During the year, Raytheon's return on sales increased from 6.4 percent to 7 percent, and its stock appreciated 23 percent.
 -0- 5/26/93
 /CONTACT: Ed Powers of Raytheon, 617-860-2415/
 (RTN)


CO: Raytheon Company ST: Massachusetts IN: ARO SU:

DD -- NE010 -- 2629 05/26/93 16:56 EDT
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Publication:PR Newswire
Date:May 26, 1993
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