UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): May 1, 2014
Motorola Solutions, Inc.
(Exact Name of Registrant as Specified in Charter)
DELAWARE | 1-7221 | 36-1115800 | ||
(State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
1303 East Algonquin Road Schaumburg, Illinois |
60196 | |
(Address of Principal Executive Offices) | (Zip Code) |
Registrants telephone number, including area code: (847) 576-5000
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02. Results of Operations and Financial Condition
The information in this Form 8-K that is furnished under Item 2.02. Results of Operations and Financial Condition and Exhibit 99.1 attached hereto shall not be deemed filed for purposes of Section 18 of the Securities Act of 1934, nor shall they be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.
On April 14, 2014, Motorola Solutions, Inc. (the Company) announced that it had entered into an agreement to sell the Companys Enterprise business to Zebra Technologies, Inc. for $3.45 billion in cash. The transaction is expected to close by the end of 2014. Based on the terms and conditions of the agreement, certain assets and liabilities that have been historically reported as part of its Enterprise business operating segment, including the Companys iDEN infrastructure business, will be excluded from the sale transaction. As a result of its entry into the agreement, beginning in the second quarter of 2014, the results of operations of the portions of the Enterprise business included in the transaction will be presented in the Companys financial statements as discontinued operations. Certain corporate and general costs which have historically been allocated to the Enterprise business will remain with the Company after the sale of the Enterprise business.
Beginning in the second quarter of 2014, the assets and liabilities of the Enterprise business will be presented in the Companys financial statements as assets and liabilities held for sale.
To assist in the understanding of the Companys continuing operations, the Company has prepared pro forma sales and operating earnings information giving effect to the discontinued operations treatment of the Enterprise business for the Company for fiscal years 2012 and 2013 and for the first quarter of 2014. The pro forma financial information is attached hereto as Exhibit 99.1.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits
Exhibit |
Description | |
99.1 | Pro forma financial information of the Company for fiscal years 2012 and 2013 and for the first quarter of 2014 |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
MOTOROLA SOLUTIONS, INC. (Registrant) | ||||||
Dated: May 1, 2014 | By: | /s/ John K. Wozniak | ||||
Name: | John K. Wozniak | |||||
Title: | Corporate Vice President and Chief Accounting Officer |
EXHIBIT INDEX
Exhibit No. |
Description | |
99.1 | Pro forma financial information of the Company for fiscal years 2012 and 2013 and for the first quarter of 2014 |
Exhibit 99.1
Non-GAAP-1
Motorola Solutions, Inc. and Subsidiaries
Pro forma Non-GAAP Adjustments Bridge
(In millions)
Q1 2012 | ||||
TOTAL | ||||
Net sales |
$ | 1,387 | ||
Operating earnings (OE) |
$ | 151 | ||
|
|
|||
Above-OE non-GAAP adjustments: |
||||
Share-based compensation expense |
34 | |||
Reorganization of business charges |
7 | |||
|
|
|||
Total above-OE non-GAAP adjustments |
41 | |||
|
|
|||
Operating earnings after non-GAAP adjustments |
$ | 192 | ||
|
|
|||
Operating earnings as a percentage of net salesGAAP |
10.9 | % | ||
Operating earnings as a percentage of net salesafter non-GAAP adjustments |
13.8 | % | ||
|
|
|||
Q2 2012 | ||||
TOTAL | ||||
Net sales |
$ | 1,537 | ||
Operating earnings |
$ | 190 | ||
|
|
|||
Above-OE non-GAAP adjustments: |
||||
Share-based compensation expense |
42 | |||
Reorganization of business charges |
9 | |||
|
|
|||
Total above-OE non-GAAP adjustments |
51 | |||
|
|
|||
Operating earnings after non-GAAP adjustments |
$ | 241 | ||
|
|
|||
Operating earnings as a percentage of net salesGAAP |
12.4 | % | ||
Operating earnings as a percentage of net salesafter non-GAAP adjustments |
15.7 | % | ||
|
|
|||
Q3 2012 | ||||
TOTAL | ||||
Net sales |
$ | 1,580 | ||
Operating earnings |
$ | 252 | ||
|
|
|||
Above-OE non-GAAP adjustments: |
||||
Share-based compensation expense |
35 | |||
Reorganization of business charges |
8 | |||
|
|
|||
Total above-OE non-GAAP adjustments |
43 | |||
|
|
|||
Operating earnings after non-GAAP adjustments |
$ | 295 | ||
|
|
|||
Operating earnings as a percentage of net salesGAAP |
15.9 | % | ||
Operating earnings as a percentage of net salesafter non-GAAP adjustments |
18.7 | % | ||
|
|
|||
Q4 2012 | ||||
TOTAL | ||||
Net sales |
$ | 1,764 | ||
Operating earnings |
$ | 327 | ||
|
|
|||
Above-OE non-GAAP adjustments: |
||||
Share-based compensation expense |
36 | |||
Reorganization of business charges |
9 | |||
Legal matter |
(16 | ) | ||
|
|
|||
Total above-OE non-GAAP adjustments |
29 | |||
|
|
|||
Operating earnings after non-GAAP adjustments |
$ | 356 | ||
|
|
|||
Operating earnings as a percentage of net salesGAAP |
18.5 | % | ||
Operating earnings as a percentage of net salesafter non-GAAP adjustments |
20.2 | % | ||
|
|
|||
FY 2012 | ||||
TOTAL | ||||
Net sales |
$ | 6,269 | ||
Operating earnings |
$ | 920 | ||
|
|
|||
Above-OE non-GAAP adjustments: |
||||
Share-based compensation expense |
147 | |||
Reorganization of business charges |
33 | |||
Intangibles amortization expense |
1 | |||
Legal matter |
(16 | ) | ||
|
|
|||
Total above-OE non-GAAP adjustments |
165 | |||
|
|
|||
Operating earnings after non-GAAP adjustments |
$ | 1,085 | ||
|
|
|||
Operating earnings as a percentage of net salesGAAP |
14.7 | % | ||
Operating earnings as a percentage of net salesafter non-GAAP adjustments |
17.3 | % | ||
|
|
The pro forma financial data presented above reflects the removal of: (i) the pro forma results of the Enterprise business as a result of the Companys anticipated sale of its Enterprise business, excluding the iDEN business and other specific assets and liabilities, as discussed in the Report on Form 8-K furnished with the Securities and Exchange Commission on April 15, 2014, and (ii) certain estimated costs previously allocated to the Enterprise business which will remain with Motorola Solutions after the anticipated sale. This financial data was prepared on a pro forma basis and, accordingly, the discontinued operations of the Enterprise business and the financial results of Motorola Solutions continuing operations may differ from what is provided above.
The pro forma financial data also contains non-GAAP financial measures within the meaning of Regulation G promulgated by the SEC. For purposes of Regulation G, a non-GAAP financial measure is a numerical measure of a companys performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with generally accepted accounting principles. The non-GAAP adjustments to Operating Earnings presented above include share-based compensation expense, intangible assets amortization, and highlighted items (significant, nonrecurring items impacting operating income or expenses). The Company has provided these non-GAAP adjustments to Operating Earnings as an estimate of the financial results of the Company on a going forward basis. These non-GAAP measures are intended to help investors better understand the Companys core operating performance, enhance comparisons of core operating performance from period to period and allow better comparisons of operating performance to its competitors on a going forward basis. These measures should be considered in addition to results prepared in accordance with GAAP, but are not a substitute for GAAP results.
Non-GAAP-2
Motorola Solutions, Inc. and Subsidiaries
Pro forma Non-GAAP Adjustments Bridge
(In millions)
Q1 2013 | ||||
TOTAL | ||||
Net sales |
$ | 1,396 | ||
Operating earnings (OE) |
$ | 173 | ||
|
|
|||
Above-OE non-GAAP adjustments: |
||||
Share-based compensation expense |
36 | |||
Reorganization of business charges |
7 | |||
|
|
|||
Total above-OE non-GAAP adjustments |
43 | |||
|
|
|||
Operating earnings after non-GAAP adjustments |
$ | 216 | ||
|
|
|||
Operating earnings as a percentage of net salesGAAP |
12.4 | % | ||
Operating earnings as a percentage of net salesafter non-GAAP adjustments |
15.5 | % | ||
|
|
|||
Q2 2013 | ||||
TOTAL | ||||
Net sales |
$ | 1,497 | ||
Operating earnings |
$ | 203 | ||
|
|
|||
Above-OE non-GAAP adjustments: |
||||
Share-based compensation expense |
27 | |||
Reorganization of business charges |
18 | |||
|
|
|||
Total above-OE non-GAAP adjustments |
45 | |||
|
|
|||
Operating earnings after non-GAAP adjustments |
$ | 248 | ||
|
|
|||
Operating earnings as a percentage of net salesGAAP |
13.6 | % | ||
Operating earnings as a percentage of net salesafter non-GAAP adjustments |
16.6 | % | ||
|
|
|||
Q3 2013 | ||||
TOTAL | ||||
Net sales |
$ | 1,517 | ||
Operating earnings |
$ | 244 | ||
|
|
|||
Above-OE non-GAAP adjustments: |
||||
Share-based compensation expense |
30 | |||
Reorganization of business charges |
21 | |||
Intangibles amortization expense |
1 | |||
|
|
|||
Total above-OE non-GAAP adjustments |
52 | |||
|
|
|||
Operating earnings after non-GAAP adjustments |
$ | 296 | ||
|
|
|||
Operating earnings as a percentage of net salesGAAP |
16.1 | % | ||
Operating earnings as a percentage of net salesafter non-GAAP adjustments |
19.5 | % | ||
|
|
|||
Q4 2013 | ||||
TOTAL | ||||
Net sales |
$ | 1,817 | ||
Operating earnings |
$ | 325 | ||
|
|
|||
Above-OE non-GAAP adjustments: |
||||
Share-based compensation expense |
30 | |||
Reorganization of business charges |
41 | |||
|
|
|||
Total above-OE non-GAAP adjustments |
71 | |||
|
|
|||
Operating earnings after non-GAAP adjustments |
$ | 396 | ||
|
|
|||
Operating earnings as a percentage of net salesGAAP |
17.9 | % | ||
Operating earnings as a percentage of net salesafter non-GAAP adjustments |
21.8 | % | ||
|
|
|||
FY 2013 | ||||
TOTAL | ||||
Net sales |
$ | 6,227 | ||
Operating earnings |
$ | 946 | ||
|
|
|||
Above-OE non-GAAP adjustments: |
||||
Share-based compensation expense |
123 | |||
Reorganization of business charges |
86 | |||
Intangibles amortization expense |
1 | |||
|
|
|||
Total above-OE non-GAAP adjustments |
210 | |||
|
|
|||
Operating earnings after non-GAAP adjustments |
$ | 1,156 | ||
|
|
|||
Operating earnings as a percentage of net salesGAAP |
15.2 | % | ||
Operating earnings as a percentage of net salesafter non-GAAP adjustments |
18.6 | % | ||
|
|
The pro forma financial data presented above reflects the removal of: (i) the pro forma results of the Enterprise business as a result of the Companys anticipated sale of its Enterprise business, excluding the iDEN business and other specific assets and liabilities, as discussed in the Report on Form 8-K furnished with the Securities and Exchange Commission on April 15, 2014, and (ii) certain estimated costs previously allocated to the Enterprise business which will remain with Motorola Solutions after the anticipated sale. This financial data was prepared on a pro forma basis and, accordingly, the discontinued operations of the Enterprise business and the financial results of Motorola Solutions continuing operations may differ from what is provided above.
The pro forma financial data also contains non-GAAP financial measures within the meaning of Regulation G promulgated by the SEC. For purposes of Regulation G, a non-GAAP financial measure is a numerical measure of a companys performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with generally accepted accounting principles. The non-GAAP adjustments to Operating Earnings presented above include share-based compensation expense, intangible assets amortization, and highlighted items (significant, nonrecurring items impacting operating income or expenses). The Company has provided these non-GAAP adjustments to Operating Earnings as an estimate of the financial results of the Company on a going forward basis. These non-GAAP measures are intended to help investors better understand the Companys core operating performance, enhance comparisons of core operating performance from period to period and allow better comparisons of operating performance to its competitors on a going forward basis. These measures should be considered in addition to results prepared in accordance with GAAP, but are not a substitute for GAAP results.
Non-GAAP-3
Motorola Solutions, Inc. and Subsidiaries
Pro forma Non-GAAP Adjustments Bridge
(In millions)
Q1 2014 | ||||
TOTAL | ||||
Net sales |
$ | 1,228 | ||
Operating earnings (OE) |
$ | 102 | ||
|
|
|||
Above-OE non-GAAP adjustments: |
||||
Share-based compensation expense |
29 | |||
Reorganization of business charges |
15 | |||
Intangibles amortization expense |
1 | |||
Gain on sale of building and land |
(21 | ) | ||
|
|
|||
Total above-OE non-GAAP adjustments |
24 | |||
|
|
|||
Operating earnings after non-GAAP adjustments |
$ | 126 | ||
|
|
|||
Operating earnings as a percentage of net salesGAAP |
8.3 | % | ||
Operating earnings as a percentage of net salesafter non-GAAP adjustments |
10.3 | % | ||
|
|
The pro forma financial data presented above reflects the removal of: (i) the pro forma results of the Enterprise business as a result of the Companys anticipated sale of its Enterprise business, excluding the iDEN business and other specific assets and liabilities, as discussed in the Report on Form 8-K furnished with the Securities and Exchange Commission on April 15, 2014, and (ii) certain estimated costs previously allocated to the Enterprise business which will remain with Motorola Solutions after the anticipated sale. This financial data was prepared on a pro forma basis and, accordingly, the discontinued operations of the Enterprise business and the financial results of Motorola Solutions continuing operations may differ from what is provided above.
The pro forma financial data also contains non-GAAP financial measures within the meaning of Regulation G promulgated by the SEC. For purposes of Regulation G, a non-GAAP financial measure is a numerical measure of a companys performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with generally accepted accounting principles. The non-GAAP adjustments to Operating Earnings presented above include share-based compensation expense, intangible assets amortization, and highlighted items (significant, nonrecurring items impacting operating income or expenses). The Company has provided these non-GAAP adjustments to Operating Earnings as an estimate of the financial results of the Company on a going forward basis. These non-GAAP measures are intended to help investors better understand the Companys core operating performance, enhance comparisons of core operating performance from period to period and allow better comparisons of operating performance to its competitors on a going forward basis. These measures should be considered in addition to results prepared in accordance with GAAP, but are not a substitute for GAAP results.