It is important to note that this level of spending has not come at the expense of higher levels of profitability, as our Government and Commercial Systems businesses both achieved operating margin levels that were at all-time highs, and growth in earnings per share has exceeded our rate of revenue growth in each of the last five years — growing at nearly double the rate of revenues in 2007.
Looking ahead, I feel confident that we have solid strategies in place that will allow us to continue this success. We have identified and are pursuing areas of opportunity that are ripe for growth. We have actions in place to further streamline our processes, reduce cycle time and enhance our already strong engineering capabilities. Our customers are realizing the benefits these actions bring and are rewarding us with higher levels of system integration responsibility on programs such as the avionics subsystems integration for the Boeing 787 and the mission system integration on the U.S. Navy's fleet of E-6B aircraft.
I don't want to imply that the road in front of us is free of obstacles. There will certainly be challenges ahead, and we know what is acceptable performance today won't be acceptable tomorrow. However, I am confident in the leadership of this company, the focus on execution, and commitment to delivering on promises. We intend to build on our track record of consistent growth and superior financial performance.
I believe that 2008 will be another solid year for Rockwell Collins. We will continue to reap the benefits from strong markets, a balanced business, and the operational leverage of our efficient business model. We expect to deliver another year of earnings per share growth well in excess of sales despite significant investments in R&D to fuel profitable growth in the future.
As good as our performance has been, I believe our best days are still ahead. Through the teamwork and commitment of our employees around the world, we are working hard to achieve the full potential of Rockwell Collins. We are doing this by continuing to focus on the fundamentals — achieving productivity gains through enterprise-wide Lean activities, making smart investments in innovative technologies, and meeting customer commitments. While this is easy to say, we know it is hard to do — and challenging to sustain. But it is a recipe that has worked well so far.
Thank you for your confidence in our company. We will work hard to earn and deserve that trust — every day.
Clayton M. Jones
Chairman, President and
Chief Executive Officer