But Results Beat Analysts' Views
By Alex Veiga, AP Business Writer
LOS ANGELES (AP) -- Military contractor and shipbuilder Northrop Grumman Corp. said Thursday its fourth-quarter net income was basically flat compared with a year earlier, when the sale of a business boosted results. Revenue in the quarter hit a record.
The company said net income for the October-December period was $454 million, or $1.31 per share, compared with $453 million, or $1.28 per share, in the prior-year period. Per-share earnings increased as the number of shares outstanding declined.
Income in the fourth quarter of 2006 included a pretax gain of $111 million, or 21 cents per share, from the sale of the company's TRW Automotive unit.
Earnings from continuing operations rose to $1.32 per share, a penny better than analyst expectations, according to Thomson Financial.
Sales rose 10 percent to $8.82 billion from $8.01 billion, surpassing Wall Street estimates of $8.44 billion.
The company's shares fell 62 cents, or nearly 1 percent, to $77.70 in afternoon trading.
"This was an outstanding quarter across the board for Northrop Grumman and a great finish to 2007," Chief Executive Ronald D. Sugar said in a statement. "All four businesses performed well, posting double-digit increases in operating margin."
The company said it received $9.9 billion in funded contracts during the quarter. That brought its total backlog of funded and unfunded orders to $64.1 billion as of Dec. 31.
Northrop's information and services division generated sales of $3.3 billion, an 11 percent jump from the same quarter in 2006.
Sales in its aerospace unit rose 1 percent to $2.2 billion, while the electronics division saw sales jump 8 percent to $1.9 billion.
The company's shipbuilding division generated sales of $1.8 billion, up 19 percent from the prior year quarter.
The jump in ship sales reflects the ongoing recovery from the impact of Hurricane Katrina in 2005 on Northrop's Gulf Coast shipyards, the company said.
Northrop is in the midst of combining its Gulf Coast operations with those in Newport News, Va.
Northrop said it does not anticipate making any major job cuts or closing any facilities as a result of the realignment.
During a conference call with Wall Street analysts, Sugar noted that military contracts obtained last year for weapons programs such as the E-2D advanced Hawkeye and the F-35 Joint Strike Fighter should provide the company with profitable revenue for decades.
Already this year, the company has received funding for the next phase of construction for the first Gerald Ford-class aircraft carrier.
Northrop said it expects 2008 profit from continuing operations of between $5.50 and $5.75 per share. Wall Street is looking for $5.60 per share.
Management forecast 2008 sales will hit $33 billion.
"Looking ahead, we expect the positive trends of the just-concluded year to continue in 2008," Sugar told analysts.
For the full year, Northrop Grumman reported net income of $1.8 billion, or $5.12 per share, compared with $1.5 billion, or $4.37 per share, in the previous year.
Revenue for the full year rose 6 percent to $32 billion versus $30.1 billion in 2006.
http://www.northropgrumman.com
Leave a comment