Lockheed Martin 3Q profit up 5 percent

AP News
Posted: Oct 26, 2011 9:24 AM
Lockheed Martin 3Q profit up 5 percent

Lockheed Martin Corp. says its third-quarter net income jumped 25 percent on higher sales and profits in its aeronautics division. But the company warned sales could be flat in 2012 in the face of government spending cuts.

The aerospace and defense contractor on Wednesday reported net income of $700 million, or $2.10 per share, for the quarter. That's up from $560, or 1.54 per share, a year earlier.

The company reported adjusted net income from continuing operations of $1.99. That beat analyst expectations for $1.81 per share, according to a survey by FactSet.

Revenue during the quarter rose 3.5 percent to $12.12 billion from $11.34 billion, beating Wall Street's estimate of $11.74 billion.

Lockheed said its third quarter was boosted by its aeronautics division, where revenue rose 21 percent to $4 billion, from $3.3 billion last year. Operating income in the division rose 15 percent to $447 during the quarter.

Lockheed also bought back $964 million in its own stock. Such buybacks increase the per-share income available to the remaining public shareholders.

The better-than-expected quarter prompted Lockheed to raise its outlook for the year, toward the high end or above what most analysts expected.

The company raised its earnings forecast for the year to a range between $7.40 and $7.60 per share, from between $7.35 and $7.55 per share.

Analysts had expected full-year net income of $7.52 per share.

But Lockheed warned that a tight fiscal environment in Washington could crimp its sales going forward. The company said it is basing its outlook on the assumption that President Obama will pass the 2012 defense budget in its current form. If that happens, Lockheed's revenue in 2012 should be "flattish" compared with this year, the company said.