STRONG PERFORMANCE FROM LOCKHEED MARTIN
21 Apr 09. Lockheed Martin Corporation (NYSE: LMT) today reported first quarter 2009 net earnings of $666 m ($1.68 per diluted share), compared to $730m ($1.75 per diluted share) in 2008. Net earnings in 2009 included higher pension expense as previously disclosed in our January 22, 2009 earnings release and in our 2008 Form 10-K. In 2009, the FAS/CAS pension adjustment was ($114)m, which decreased net earnings by $74m ($0.19 per share). In 2008, the FAS/CAS pension adjustment was $32m, which increased net earnings by $21m ($0.05 per share).
Net sales for the first quarter of 2009 were $10.4bn, compared to $10.0bn in 2008. Cash from operations for the first quarter of 2009 was $1.2 bn, compared to $880 m in 2008.
“The Corporation is off to a solid start in the first quarter of 2009,” said Bob Stevens, Chairman, President and CEO. “Our team of 146,000 dedicated employees continues to focus on enhancing shareholder and customer value by utilizing the depth and breadth of our capabilities as the world’s premier global security company.”
Summary Reported Results and Outlook
The following table presents the Corporation’s results for the periods referenced in accordance with generally accepted accounting principles (GAAP):
($ ms) 1st Quarter
Net sales $2,913 $2,789
Operating profit $390 $366
Operating margin 13.4% 13.1%
Net sales for Electronic Systems increased by 4% for the first quarter of 2009 compared to the first quarter of 2008. The increase mainly was due to higher volume on air defense, tactical missile and fire control programs at Missiles & Fire Control (M&FC) and in simulation and training activities at Platforms & Training (P&T). These increases partially were offset by declines in volume on integrated defense technology programs and surface naval warfare activities at Maritime Systems & Sensors (MS2).
Operating profit for Electronic Systems increased by 7% for the first quarter of 2009 compared to the first quarter of 2008. The increase primarily was attributable to higher volume and improved performance on fire control and air defense programs at M&FC and the benefit recognized in the first quarter of 2009 from favorably resolving a simulation and training contract matter at P&T. These increases partially were offset by declines in volume on integrated defense technology programs and surface naval warfare activities at MS2.
Information Systems & Global Services
($ ms) 1st Quarter
Net sales $2,761 $2,504
Operating profit $242 $230
Operating margin 8.8% 9.2%
Effective January 1, 2009, IS&GS redefined its lines of business to better align the segment based on its core customers and business activities. The new lines of business are as follows:
Civil – supports civil agency customer missions;
Defense – supports defense customer missions; and
Intelligence – supports intelligence customer missions.
The realignment had no impact on the segment’s operating results. The prior period amounts have been reclassified to conform to the new lines of business.
Net sales for IS&GS increased by 10% for the first quarter of 2009 compared to the first quarter of 2008. The increase in sales primarily was attributable to higher volume on enterprise civilian services in Civil and on mission and combat systems activities in Defense.
Operating profit for IS&GS increased by 5% for the first quarter of 2009 compared to the first quarter of 2008. Operating profit increases in Defense partially were offset by declines in Civil. The increase in Defense mainly was due to volume and improved performance in miss