GENERAL DYNAMICS, LOCKHEED MARTIN AND UNITED TECHNOLOGIES REPORT EARNINGS
GENERAL DYNAMICS
22 Jan 14. General Dynamics (NYSE: GD) reported 2013 fourth-quarter earnings from continuing operations of $624m, or $1.76 per share on a fully diluted basis; revenues for the quarter were $8.1bn. For the full year of 2013, earnings from continuing operations were $2.5bn, or $7.03 per share fully diluted, on revenues of $31.2bn.
Net earnings for fourth-quarter 2013 were $495m, or $1.40 fully diluted, including a $129m loss in discontinued operations related to the pending settlement of the long-standing A-12 litigation. Net earnings for the full year were $2.4bn, or $6.67 per share fully diluted.
Margins
Company-wide operating margins in 2013 were 11.4 percent for the fourth quarter and 11.8 percent for the full year, increasing over 2012 margins calculated on a non-GAAP basis for the same periods. Aerospace and Combat Systems achieved significant margin expansion in 2013 and Marine Systems and IS&T margins were consistent with the company’s expectations.
Cash
Net cash provided by operating activities totalled $1.6bn in the fourth quarter of 2013 and $3.bn for the full year. Free cash flow from operations, defined as net cash provided by operating activities less capital expenditures, was $1.4bn in the quarter (222 percent of earnings from continuing operations) and $2.7bn for the year (107 percent).
Backlog
The company’s total backlog was $46bn at the end of the year. In the fourth quarter, orders were strong in the Aerospace group across the Gulfstream fleet. Significant orders were also received for production of additional double-V-hulled Stryker combat vehicles and engineering development of the next Stryker upgrade program; for long-lead material for Virginia-class Block IV submarines and design work on the next-generation ballistic-missile submarine; and for weapons-systems development, information technology services and tactical network components and radios. Estimated potential contract value, representing management’s estimate of the value of unfunded indefinite delivery, indefinite quantity (IDIQ) contracts and unexercised contract options, increased to $27.6bn at year-end 2013. Total potential contract value, the sum of all backlog components, was $73.6bn at the end of the year.
“General Dynamics performed well in 2013, reflecting our continued focus on operations, cost management, cash generation and our commitment to meeting our customers’ requirements,” said Phebe N. Novakovic, chairman and chief executive officer. “As promised, we managed our company prudently, adjusting our business to reflect the realities of the current defense spending environment and retiring risk throughout the organization.”
Lockheed Martin
23 Jan 14. Top U.S. weapons maker Lockheed Martin Corp (LMT.N) reported lower-than-expected earnings on Thursday after charges linked to U.S. defense budget cuts and workforce reductions, but said it expected higher earnings this year. Lockheed, maker of F-35 fighter jets, satellites and warships, on Thursday said fourth quarter net earnings from continuing operations fell 14.2 percent to $488m, or $1.50 per share, from $569m, or $1.73 per share, a year earlier. Revenues dropped to $11.5bn from $12.1bn. Analysts polled by Thomson Reuters I/B/E/S had forecast net quarterly earnings of $668.5m or $2.02 per share on revenues of $11.34bn. Lockheed, the Pentagon’s No. 1 supplier, said full-year earnings from continuing operations reached a record $3.0bn, or $9.04 per share, up from $2.7bn, or $8.36 per share, in 2012. Revenues dropped to $45.4bn in 2013 from $47.2bn in 2012.Analysts had projected earnings of $3.11bn or $9.49 per share on $45.1bn in revenues. The company said it expected slightly lower to flat revenues of $44bn to $45.5bn in 2014, but earnings per share were likely to rise to $10.25 to $10.55. Lockheed Chief Executive Marillyn Hewson said the company reached a r