COMPENSATION DISCUSSION AND ANALYSIS EXECUTIVE SUMMARY Key 2023 Performance Highlights In 2023, Textron’s revenues increased 6% and segment profit increased 17%, compared with 2022. Our backlog increased 5% in 2023, to $13.9 billion, which included a $782 million increase at the Textron Aviation segment. During 2023, we continued to manage through the impacts of ongoing global supply chain shortages/delays and labor shortages to deliver products to our customers. Financial highlights for 2023 also include: ● Generated $1.3 billion of net cash from operating activities from our manufacturing businesses ● Invested $570 million in research and development projects and $402 million in capital expenditures ● Returned $1.2 billion to our shareholders through the repurchase of 16.2 million shares of our common stock Beginning in 2023, we changed how we measure our segment profit for the manufacturing segments, as discussed below under 2023 Annual Incentive Compensation Performance Metrics on page 31. As a result of this change, the prior periods have been recast to conform to this presentation. Business highlights for 2023 include: ● Textron Aviation announced development of the Citation Ascend which is designed to bring the latest technology and innovations in cockpit avionics, engine performance and luxurious cabin features to the midsize business jet market. As part of a new fleet agreement with NetJets, Textron Aviation named NetJets as the fleet launch customer for the Ascend. ● Bell began work on development of the next generation tiltrotor aircraft for the U.S. Army’s Future Long Range Assault Aircraft (FLRAA) program under a contract awarded to Bell in December 2022. Bell ramped up activity with additional engineering resources, contracting with key suppliers, ordering long-lead materials and breaking ground on a new FLRAA Drive Systems Test Lab as it continues work on a new tiltrotor aircraft to meet U.S. Army weapon system requirements. ● Textron Systems grew its Intelligence, Surveillance and Reconnaissance (ISR) support to the U.S. Navy, expanding our Aerosonde® uncrewed aircraft systems (UAS) from four to seven vessels over the course of 2023. Also, Textron Systems was selected for Option 2 for the Future Tactical Uncrewed Aircraft System (FTUAS) program and its RIPSAW® M3 was downselected to participate in the Army’s Robotic Combat Vehicle Phase 1: Platform Prototype program. ● Textron Specialized Vehicles unveiled its new Jacobsen SLF1 ELiTE lithium mower. The newest Jacobsen offering was the centerpiece of an allelectric display of Jacobsen and Cushman products at the 2023 Golf Course Superintendents Association of America Conference and Trade Show. In addition, Textron Ground Support Equipment launched its new TUG 660 Li belt loader, powered by lithium battery technology. This zero-emission, fully electric operation allows airlines, air freight companies and ground handlers to help achieve their sustainability goals with lower operational costs. TEXTRON 2024 PROXY STATEMENT 23
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