Good day, ladies and gentlemen, and welcome to the Fourth Quarter 2011 Harris Corporation Earnings Conference Call. My name is Anne, and I will be your coordinator for today's call. As a reminder, this conference is being recorded. [Operator Instructions] I would now like to turn the presentation over to Pamela Padgett, Vice President of Investor Relations. Please proceed.

Hello, everyone, and welcome to our fourth quarter fiscal 2011 conference call. I'm Pamela Padgett. On the call today is Howard Lance, Chairman, President and CEO; and Gary McArthur, Senior Vice President and Chief Financial Officer. A few words about forward-looking statements. In the course of this teleconference, management may make forward-looking statements. Forward-looking statements involve assumptions, risks and uncertainties that could cause actual results to differ materially from those statements. For more information on the discussion of such assumptions, risks and uncertainties, please see the press release and filings made by Harris with the SEC. In addition, in our press release and on this teleconference and the related presentation, we will discuss certain financial measures and information that are non-GAAP financial measures. A reconciliation to the comparable GAAP measures is included in tables in our press release and on the Investor Relations section of our website, which is www.harris.com. A replay of this call will also be available on the Investor Relations section of our website. And with that, Howard, I'll turn the call over to you.

Thank you, Pam, and let me welcome all of you to our fourth quarter fiscal 2011 earnings call. To provide added clarity to the call, this time we've posted some slides on our website, and we'll be referring to those throughout the conference call. Beginning first with Slides 3 and 4. We ended fiscal 2011 with another solid quarter. Revenue was $1.67 billion, increasing 15%. Organic revenue growth was 4%, and that was driven by 11% growth in our Government Communications Systems segment and 7% growth in our new Integrated Network Solutions segment. Flat year-over-year revenue in RF Communications was, we think, an excellent outcome for this business as we make our way beyond the large tactical radio shipments in the prior year to equip MRAP vehicles. The first quarter of fiscal 2012 will be our last tough compare as we reset our baseline for future growth. There were certainly highlights in the quarter as our Public Safety and Professional Communications business posted strong revenue growth of 9% and a record quarter end backlog of the $737 million. Our move into this very close adjacent market during fiscal 2009 is contributing nicely to both our revenue growth and higher operating income. The Broadcast Communications business posted 37% growth in orders, 31% growth in revenue and a solid profit. Harris IT Services posted 8% top line growth and higher profitability. And Harris CapRock Communications delivered a solid profit number in the quarter. On the downside, our new initiatives in Healthcare and Cyber will take time to contribute to earnings. Both businesses had operating losses in the quarter. And about $100 million in International Tactical Communications orders slipped to the right as a result of political uncertainty in Central Asia, the Middle East and Northern Africa. Non-GAAP earnings per share were $1.24…

Thank you, Howard. Turning to Slide 8. Fiscal year 2011 was another very solid financial year for Harris. We ended the year with $367 million of cash and cash equivalents on hand. We generated $833 million of operating cash flow, $508 million of free cash flow, repurchased $250 million of our outstanding stock and paid $127 million in dividends. None of our outstanding long-term debt comes due prior to October 2015. And as of year end, we had $870 million available under our $1,050,000,000 combined revolving credit facilities. As to the fourth quarter, cash flow generated from operating activities was $276 million as compared to $167 million in the fourth quarter of fiscal 2010, and capital expenditures were $129 million for the fourth quarter as compared to $62 million in the fourth quarter of the prior year. The $67 million higher capital expenditures resulted primarily from the fit-out of our new RF manufacturing facility that is now fully up and operational, the Cyber Security Solutions facility whose grand opening was in late May and capital expenditures at INS as a result of the CapRock and Schlumberger acquisitions. Depreciation and amortization was $63 million for the fourth quarter as compared to $45 million for the fourth quarter of the prior year. Our non-GAAP effective tax rate for the fourth quarter was 32.5%. During the quarter, we increased our share buyback to $100 million. We purchased 2 million shares at an average purchase price of $48.83 per share. Total shares repurchased during fiscal 2011 were 5.3 million or 4.2% of our outstanding shares. As announced in our press release, we replaced our existing share repurchase program with $1 billion new program under which we expect to repurchase up to $500 million worth of our shares, largely by the end of this calendar year or roughly 8% to 9% of the shares outstanding. Further, we announced a 12% dividend increase that takes our quarterly dividend from $0.25 to $0.28, our 10th year in a row of double-digit increases. Moving to Slide 9. We revised guidance for fiscal 2012 as follows: cash flow from operations in a range of $825 million to $875 million; depreciation and amortization of $280 million to $290 million; and capital expenditures, including capitalized software of $265 million to $285 million. Our non-GAAP effective tax rate is now expected to be 33% compared with our prior guidance of 33.5%. The tax rate for any given quarter could vary up or down as a result of discrete tax events occurring therein. We continue to operate from a position of financial strength, which allows us to invest for the future while delivering significant value to our shareholders in the forms of share repurchases and higher dividends. Our outlook for operating cash flow remain strong and fiscal 2012 should be another year of solid financial returns. Back to you, Howard.

Thanks, Gary. Let me conclude my prepared remarks and talk about the 2012 outlook, utilizing Slides 10 and 11. We're updating our financial guidance for fiscal 2012 with consolidated revenue now expected to be between 4% and 6% higher than fiscal 2011, revenue between $6.15 billion and $6.3 billion. Non-GAAP income, excluding acquisition-related costs, is now expected to be in a range from $5.10 to $5.30 per diluted share, a year-over-year increase of 4% to 8%. The changes between our prior outlook and current outlook reflect lower revenue and income in International Tactical Communications, as well as increased losses in our Cyber business, offset by higher expected income in Government Communications, a slightly lower tax rate and the positive impact from our new share repurchase plan. We'll certainly have a clearer picture of the timing of international orders and revenue as we move through the next 2 quarters, which will help to tighten our EPS range going forward. Now our current view to the distribution of EPS in fiscal 2012 is about 40% of the earnings in the first half and about 60% of the earnings in the second half, with first quarter EPS in a range of $1 to $1.05 per share. Back to full year guidance, adjusted EBITDA is expected to be in a range from $1.28 billion to $1.32 billion, that's a year-over-year increase of 4% to 8% in line with revenue. For the RF Communications segment, fiscal 2012 revenue is expected to be 3% to 6% lower than fiscal 2011, reflecting the timing of international orders turning into revenue. So the new guidance now anticipates decline in Tactical Communications revenue of about 10% year-over-year versus our previous flat year-over-year revenue guidance. We continue to expect double-digit growth in Public Safety and Professional Communications. And our segment operating margins are now expected to be in the 33% to 34% range. For our Integrated Network Solutions segment, we expect revenue to be in a range of 16% to 18% higher than fiscal 2011, and that represents organic growth in a range of 7% and 9% higher. Non-GAAP segment operating margin is expected to be between 5.5% to 6.5%, which includes the anticipated operating losses of about $30 million in our Cyber business. And finally, for the Government Communications Systems segment, we expect revenue for fiscal 2012 to be 2% to 4% higher than fiscal 2011, and segment operating margins are expected to be about 13.5% of revenue. With that, I'll ask the operator to open the line and we'll be pleased to take your questions.

[Operator Instructions] And our first question comes from the line of Carter Copeland with Barclays Capital.

So just a couple of quick questions. First off, on the share repurchase plan, I mean, obviously, this is quite a big step up from where you've been before. You're going to repurchase in the next 2 quarters more than you've done in the last 2 years combined -- 2 fiscal years combined. So I just wondered if you might talk about the board's view here, and what this may signal in terms of cash deployment, your strategy there? How you're thinking about this? Is this something we should consider as a new norm? Has your view changed? How should we consider this?

Well, first of all, we've consistently said that strategic acquisitions then dividends and then share repurchase have always been a part of our capital distribution and capital structure thinking. As we look at acquisitions, we've made a number of acquisitions in fiscal '11 and the focus in fiscal '12 is very much on integrating those acquisitions and delivering on the promise of them, as well as the ones that had gone previously like the Public Safety business, which as you see is really starting to pick up steam. We certainly feel that a double-digit increase in our dividend rate is consistent with what we've done in the past as we target a payout ratio, north of 20%, and this will be consistent with that. And so when we look at then the cash flow that we're going to generate from operating cash less our needs for the requirements for CapEx, we felt that the current valuation of the shares that this was a very appropriate deployment of cash and makes a strong statement about the board and management's view of the future earnings potential for the company. Whether this becomes the "norm" or not, beyond that, I think, remains to be seen. But the fact that we do have a $1 billion authorization suggest that there is another $500 million tranche that's going to be repurchased beyond fiscal year '12.

Great. And as a follow up, I wondered if we might revisit briefly the targets that you've laid out before in terms of the progression over the next couple of years, both at INS and RF Communications. It would seem there's probably some changes to those, maybe not, how should we think about your prior views of INS given a slower process in Cyber, and perhaps some other areas within there, as well as international, is that just timing and we'll get back to the old target, or is this something that needs to be reconsidered?

Well, I certainly still believe that the kind of 10% to 13% EPS growth targets over the 3-year time frame that we laid out are absolutely still achievable. On the growth side, I think we said 8% to 9% organic growth given that we're dropping off a little bit in '12, perhaps that 3-year CAGR would be just a little bit lower. But the EPS targets I think are absolutely on track and the combination of the operational improvements we expect, as well as contribution from slightly smaller share outstanding.

And our next question comes from the line of Pete Skibitski with SunTrust.

Howard, on that roughly, I guess, 10% sales take down in RF Tactical, I wonder if you could tell us how much of that relates to the U.S. decision to freeze some Pakistani funding, maybe an indication of when that might be alleviated, the restriction there.

Pete, I think that's a pretty small factor in that. There's really no one country or one order, but it's really been kind of a broad-based pushout across Northern Africa, the Middle East and Central Asia. We certainly think that while Pakistan is kind of on-hold currently, we certainly expect that their relations there will warm, and we'll see those -- that market open back up to us. But in and of itself, that one country is not the reason behind it. It's really been everything that you've seen going on across the region over what's been a very tumultuous 6-month period, and it's primarily politically-driven. It's really not at all driven by expectations of somehow a lower security risk or a lower need for these communications. So we're certainly frustrated now 2 quarters in a row to see about $100 million each quarter of orders pushed out. But the good news is we haven't lost any orders, and I actually think our product position is even strengthening as time goes on. So we're going to see the orders come in at some point and get turned to revenue. If that happens earlier in the year, then certainly the high end of our guidance is possible. If it doesn't happen until later in the year, then it might be the lower end. And that's why you see the range a little wider than it traditional is.

Okay. A very quick one for Gary, and I'll get out of the way. Gary, did you have any participating securities adjustments on the income statement in the quarter? I didn't see it in the release.

No, none that I can think of, Pete.

Okay, because you typically have those each quarter, correct?

Participating, not really. I'd go back and have to look, but I don't believe so. I could be correct, and I'll doublecheck, but I don't believe so.

And our next question comes from the line of Gautam Khanna with Cowen and Company.

So your new RF Tactical guidance is like $1.6 billion, which implies today you have a 48% backlog to forward sales ratio, which is among the lower end of what it's been historically. I just wondered if you could comment about kind of how many -- maybe if you could give us a sense for the amount of bids outstanding? Or at what point we should be a little bit more concerned about another possible reduction? Or do you see a lot of stuff in the very near-term pipeline that's likely to convert so that we don't get another downward revision? And then lastly, if you could just update us on the NRO patriot recompete and where you guys stand there?

Right. So on RF backlog, if you go back 6 years, you'll see the numbers as low as 30% and as high as 70%. So there's a wide range of where we've entered the year with backlog compared to what our sales turn out to actually be. The average is 51.5%, so I don't think 48% is materially different than the average. Obviously, we're counting on some new orders coming in. And the timing of those orders, as I indicated, especially in international because they can be very large and lumpy, will have an impact on when those turn to revenue. With regard to the patriot recompete, there's been a down select made, I think, the 2 companies. We are not one of those companies. And so we have reflected the lower revenue from that recompete not going our way in the guidance we've provided for INS, part of INS that Harris IT Services provides. So that's in the guidance, and it will affect us for about half a year starting in kind of January.

And our next question comes from the line of Michael French with Morgan Joseph.

Howard, first, I'd like to ask you about the succession planning. It was a little bit of surprise to see that you're planning to retire. I think you've done a good job, you've established a great culture, and you're definitely a pleasure to be around, so very sorry to hear that. But just perhaps, you could walk us through how the search is going and what you -- what kind of timing you would expect on an announcement?

Well, there's certainly nothing specific I can say about timing on an announcement. What I can say is that the board is diligently engaged in interviewing both external and internal candidates. I know that they feel a sense of urgency to name a successor, not because they're anxious to get me out of here, but because we certainly don't want to be in a void for an extended period where leadership is uncertain. But in terms of the timing, that remains to be seen. But there's a real sense of urgency obviously balanced by the desire to pick the right person to lead the company in our next chapter. So lots of work is underway, and you'll just have to stay tuned. I can't say anything specific with regard to timing.

Okay. And then I'd like to follow up on something you mentioned on the last call, that at a SPA warrant in San Diego, they have an RFI for essentially an off-the-shelf jitters radio. Has there been any movement on that process?

Not that I'm aware of at this point.

Okay, and then...

Are you speaking about the GMR alternative?

Yes.

Yes, I don't believe anything has happened subsequent to that, at least not that I'm aware of.

Okay. And then you mentioned today that on the Cyber side, you were going to be taking some steps to accelerate business there. Can you elaborate on that? Are you talking about being more aggressive on pricing, or are there other things that you can do?

Yes, I'm not sure it's as much accelerate on the revenue side. Certainly, we're doing what we can, but we're just seeing that while I think the cloud -- computing cloud hosting market is going to be very, very large and lucrative at some point in the future, the transition's going much more slowly, and we've seen that and talked to a lot of companies. So I'm not sure we're going to be able to accelerate that, although we'll do what we can. But certainly, in response to that, we're taking a hard look at the cost side of the equation and our expenses and plans for additional capital expenditures and depreciation and amortization and that sort of thing, to see what can be done to potentially trim, what right now our best estimate is about a $30 million operating loss, whereas previously, we had hoped that to be kind of break even for this year.

And our next question comes from the line of Joe Nadol with JPMorgan. Joseph Nadol - JP Morgan Chase & Co: Howard, on the margin guidance for RF, it's up 100 basis points versus where you had guided 3 months ago or last quarter. And the part of the revenue guidance that came down was obviously some of the higher margin part of the business. Also, if you just look at the fourth quarter, you did 30.4% margin in the RF segment overall and the mix to me looks pretty similar to what you're expecting for the coming year. So I'm just wondering what are the offsets to get the margins up, those 300 basis points that you're expecting from the fourth quarter? Is R&D coming down? Are there any other items in there, some other kind of mix, et cetera?

Yes, great question, Joe, and you're exactly right. We've taken a lot of steps to mitigate the amount of the margin decline from '11 to '12. In the segment it's only about 100 basis points. So how have we done that? Well, number one, Public Safety, Professional Communications business return on sales or margins are moving significantly higher. If you go back 2 years, Gary and I talked about guidance in that business, and we are now starting to see the top line and the bottom line move. And so it's becoming, as a result, less dilutive to the segment. Secondly, our new manufacturing facility and a number of other operational and cost reduction actions are allowing us to actually maintain very, very high margins in the RF segment. Fourth quarter was a little bit of an anomaly. We used the opportunity to accelerate some of our R&D by using some contract engineering, not only inside, but outside the company. And so the previous quarter, I think, for the segment was 32.5%. So Q4 was a little bit of an anomaly, as sometimes happens in quarters. But the bottom line is, we feel very confident in the 33% to 34% guidance we're providing, and it does not involve a major reduction in R&D, but rather focuses heavily on actions at the gross margin line in both Tactical, as well as significant progress being made in Public Safety. Joseph Nadol - JP Morgan Chase & Co: Well, you've indicated that Public Safety is around 10% in the past, and I'm wondering if you could give a little more color as to where we're getting there. Is that getting up into the mid-teens?

Well, as we've integrated the businesses, it's a little difficult to call that out. But I can tell you that we are very comfortable that we are now on track toward the kind of return on sales numbers that Gary and I talked about. Ultimately, I think on the call, we said our goal was about 15% EBIT and closer to maybe 19% EBITDA margins, and this absolutely is moving us that direction.

And our next question comes from the line of Larry Harris with CL King. Lawrence Harris - CL King & Associates, Inc.: I was wondering if you could talk about the texture of orders or bookings right now in some of the U.S. government businesses, Tactical Communications outside of the 117G and Government Communications and Integrated Network Solutions. Some companies that have been reporting, I guess, paperwork problems this past quarter, what are you seeing right now in some of your businesses?

We haven't seen anything particularly, Larry, a significant item that I would call out. I think there continues to be a lot of concern and at times confusion around exactly what money is going to be available for what programs. And certainly, we've seen a lot of talk now in the last 24 hours by various analysts as a result of the debt ceiling deal that was crafted in Congress. We really haven't seen anything material as a result of the last quarter. It's been a little slow, as you know, and our guidance shows modest growth compared to what we've been able to deliver in the past. So obviously, we're hopeful that this is overblown and the opportunity to have higher growth in government systems and in IT services. We've been doing very well in IT services and with 11% in government systems, that's kind of a blowout quarter. So we really haven't seen a lot of big things. I think that has a lot to do with our diversity of programs for a company our size, with 250 to 300 programs across not just DoD, but intelligence, civilian agencies, lots of $10 million and smaller annual revenue programs. I think that's cushioning us pretty well. We won't be totally blind, I'm sure, to program adjustments and so on. But at this point, we're not seeing anything of the magnitude that you're asking about. Lawrence Harris - CL King & Associates, Inc.: Understood. And you mentioned that there were a couple of IDIQ-type contracts, I believe, in the Tactical Communications area. If you win those, could those convert to sales this fiscal year?

I don't know specifically whether we have any of those contracts in our -- it's certainly in our pipeline. I don't know how many of them we might have in the actual revenue forecast. What I can say in terms of little color around those, one is the special operations forces, we think that's expected to be kind of in hundreds of million of dollars of opportunity. That's probably an FY '13 program and that's kind of tied to one of the future capability sets in the Army, and I think that's correct. And then the other one for the Navy is maybe tens of millions of dollars. That one is more FY '12 oriented. So gives you a little bit of color around them. But the nice thing about IDIQs, it sets a ceiling and gives a lot of flexibility. So if up-tempo or needs emerge and new technology they want to take advantage of, especially special forces, they had then have a contract ceiling and a vehicle to procure radios. So as we continue to put out radios with more and more capabilities, we love to see these IDIQ contracts because I think that the balance shifts really toward a commercial company like Harris and to be able to make the maximum benefit out of those kinds of vehicles. Lawrence Harris - CL King & Associates, Inc.: Yes, hundreds of millions, that would be significant.

And our next question comes from the line of Josephine Millward with Benchmark Company.

Howard, in your updated fiscal year '12 guidance, are you assuming another CR, or can we see further downside if the '12 budget hasn't get done until some time next year?

Yes, so you're talking about whether we are expecting an additional or a new continuing resolution in the government fiscal year '12 budget? Well, I don't think we have or expect anything to be signed in September when it's supposed to. So I suspect that we are looking for it to be executed maybe January or February, that's kind of in the pattern. But I don't think that we're expecting a full year continuing resolution. So we're probably balanced somewhere in the middle on that.

That's fair. Can you give us an update on the 117G manpack contract vehicles, I believe, you have in place with the Army moving at SOCOM? How much is left on the ceiling of these contracts? And when do you expect the RFP on jitters alternative for manpack and GMR to come out? Would they -- would you anticipate them some time after the follow-on networking exercise in October?

First of all, I don't have, at my fingertips, how much is remaining on those contract vehicles side. I just don't know those numbers, so we'd have to get back to you on that. I'm not aware at this point that contract vehicles are an issue so -- but I just don't have those numbers. With regard to the timing on GMR, I would really be speculating. We certainly know that they need a replacement. We think that the market -- just to remind you the market size for, say, a 2-channel GMR vehicle replacement, we still think we're talking about upwards of 25,000 radios, $3 billion in revenue opportunity over a period of years. So really can't say how many years, can't say when they're going to start that. We really don't have anything to speak of in our fiscal '12 guidance. So we're expecting -- and I think beyond that. When the timing of an RFP would occur, I really can't say. But you may be right, it's likely to be after that October NIE and we're really not counting on anything in '12. But certainly, for '13, '14, '15, I think we would expect to start seeing some opportunity there. I think we're going to be in a very strong position to take advantage and serve that 25,000 unit ultimate opportunity.

And our next question comes from the line of Josh Sullivan with Gleacher. Josh Sullivan - Gleacher & Company, Inc.: In the past, you've talked about how Public Safety applications can be leveraged internationally. Can you talk about any traction there?

Yes, I think we have a limited amount of ability to leverage, and it's really in those markets that are using the P25 standard. The other standard, which I'm forgetting the name of it, is TETRA. Thank you, Pam. The TETRA standard, we don't have access to that technology currently. And most of the international market of $4 billion or so annually is TETRA. But those markets which are not they tend to be more rural in nature, larger geographies, tend to use the P25 standard, and we are pretty well positioned with those. We saw nice increases in fiscal '11 with our international Public Safety orders. It was a nice growth area off of fiscal '10, and we certainly have expectations of another very good growth year in fiscal '12 internationally. But it's still going to be a relatively small piece of our overall revenue in PSPC. Josh Sullivan - Gleacher & Company, Inc.: Okay. And just secondly, domestically, just given the pressure on some municipalities under -- I mean, what does the competitive landscape look like here? Are you guys winning contracts on cost or capability?

Well, it certainly continues to be and will continue to be a competitive market, but I think you need to think of the market in 2 pieces. The part that's really been most impacted by kind of yearly annual budgets is what I would call the kind of repair and replacement, what we call the flow business. And we have certainly seen pressure on that business because they're not adding additional police officers, firemen, emergency technicians. If they have 5 radios in reserve and 2 break down, they're not buying new radios because they don't have the short-term budget money. So we've already seen, I think, significant impacts from that. On the flip side though, money is available for these large modernization programs. And we have won 4 or 5 large ones over the last several quarters we've announced. These have all been competitive. And I think a combination of 3 factors is allowing us to win. Certainly, we have to be competitive on price, but we don't need to have the lowest overall price by a significant amount. We are viewed as having very competitive and often superior technology and support. And thirdly, the Harris brand that's now wrapped around the Public Safety business has created a lot of demand and a lot of traction for competitive bids in this market. So I think you put those factors together and a strong and even upgraded management team at PSPC, and we certainly like the momentum that seems to be building in that market. Having said that, certainly, it's competitive, and the day-to-day replacement and upgrade business, budgets are tight.

And our next question comes from the line of Ted Wheeler with Buckingham Research.

I wondered if you could give a little more color on the Cyber situation. You talked about some cost issues, but maybe you could address the revenue side? I mean, does the slow start a pushout? Or are some of the people or potential contracts that you would hope to engage in moving elsewhere? I wonder if you could just kind of go through what might be a new outlook for getting the revenues to where you want them to be?

Yes, I think overall, Ted, I would kind of characterize this as kind of a 1-year slip in our expectations. Back in March, we talked about the investments that we've made in capital for the facility, the upgrade, for all of our initial tranche at customer-facing equipment, kind of in the $175 million to $200 million range. And that would ultimately be able to drive revenue of about $80 million at nice profitability with maybe $50 million of revenue or so being at the break-even point, given the expenses that we have and we have people operating the business and the depreciation and amortization on the investments. So that's kind of where we were sitting. We thought that in FY '12 we would have enough momentum to get to that level and kind of be plus or minus at break even. My assessment now is that's going to be probably pushed out a year. I don't believe that we have lost a significant amount of business. I think we were just in the category of start-up. We started up the business and opened the center a little later than we have planned, and just didn't allow enough time in our planning for what was going to be channel development, starting to work with our partners on developing prospects. And then the time to close, once we had a prospect, is turning out to be much longer. Because people are just going to be a little more cautious, especially about taking their business to the cloud in an outside cloud as opposed to -- they may take it to a cloud faster in their own operations than outsource it to someone else. And again, we were focused -- we are focused on really mission-critical, very high-end applications. And so in hindsight, we were just too optimistic in how quickly this was going to turn. We're still very convinced this is going to be a very large market, one that suits Harris well and one that we ought to be able to generate $100 million of very profitable revenue from. But we are not starting out where we had hoped. We lost, as we already had indicated, an excess of $20 million in fiscal '11. And now we're estimating this $30 million for fiscal '12. So I think it's -- unfortunately, like sometimes new market entries, you don't know what you don't know. You make assumptions. You find out sometimes you're right. In this case, we weren't. And so we've had to bake that into our updated guidance for next year.

I guess, the number of conversations and evaluations also change from what you thought or -- and therefore, just sort of timing a process? Or are you having difficulty getting -- sort of people getting started to kick the tires?

I think the conversation has now have begun, and they really have been about 6 months later than we'd really expected in terms of really ramping up. It was hard to have a lot of conversations before we have the facility open. The customers could come in or go in our portal and see really what it is with more specificity around what we're offering. I think coming forward, in future quarterly calls, we'll provide more color around the pipeline and how it's going. But right now, we wanted to communicate where we think we are.

Big swing for fiscal '13, I guess?

Well, that's the way I view the opportunity certainly. If we -- now have in the numbers we've given you, $30 million loss and can get to break even in '13, that's $0.15, $0.17 a share improvement in '13. But I'm sure there are some investors from Missouri at this point that we're going to have to convince that, that's more real than we thought it was 6 months ago. Let me add on Josephine's question that the notes indicate that we do expect to see the RFP before the end of the calendar year. I don't know if that'll happen or not, but that's a current expectation. And then it'll take some months to award, so it could easily be to the end of the fiscal year before the RFP is awarded and any contract comes out of that. So that's what our current thinking is, but I think it's probably a fair subject to change.

We do have one final question, and that's a follow-up from the line of Pete Skibitski with SunTrust.

Yes, two quick ones. Howard, just wondered if there's any opportunity to protest the NRO patriot loss?

We do not plan to protest that loss.

Okay. And then I just wondered on the Healthcare opportunity set, there was used to be a lot of talk about a lot of money from the stimulus bill available for healthcare opportunities. I'm wondering what the update is on that front.

I think the opportunity pipeline is very, very large and we bought a commercial business, it's not that large. And so, a couple of deals slipping out in the quarter can have an impact on profitability. It's a software and services business with high gross margins. So I don't want you to take away from our comments that we lost money due to Carefx acquisition in Q4 as that, that's going to be an ongoing loss, as I've indicated Cyber will be. We expect a turnaround and grow in that commercial healthcare business and be profitable in fiscal '12. And as you heard from my prepared remarks, we are making a huge amount of progress with the Department of Veterans Affairs, and our Healthcare business there is going to grow significantly. So I think fiscal '12 is going to be a very good year for the Healthcare Solutions business at Harris, both government and commercial. I think we're going to build momentum and see a lot of growth in '13 and '14. But the reality was that we lost money primarily on the commercial acquisition in Q4, and we need to build that results base to show you as we go forward in '12. But we do not expect to lose money in the Healthcare in fiscal '12.

Thank you everyone for joining us today.

Ladies and gentlemen, we thank you for your participation in today's conference. This concludes the presentation, and you may now disconnect. Have a good day.