Like oil companies, aerospace firms have been very profitable in recent years. But times have changed. And if Obama pulls out of Iraq and doesn't launch any new wars, then aerospace firms will have to start focusing more on the commercial/scientific contracts.
WASHINGTON (AP) - Defense contractor Northrop Grumman Corp., which has major operations in the South Bay, on Tuesday posted a fourth-quarter loss, hurt by a large charge as it wrote down the value of past acquisitions in its shipbuilding and space operations.The maker of military aircraft and ships said it posted a loss of $2.54 billion, or $7.76 per share, in the latest quarter. That compared with a profit of $457 million, or $1.32 per share, in the same period last year.
Results included an expected $3.06 billion charge for goodwill impairment. That means accounting rules forced the company to lower the value of the acquisitions because it had overestimated their worth. Given the recent decline in market value, the book value of Northrop's acquisitions of Litton Industries Inc. and TRW Inc. were priced too high.
Excluding the charge, Northrop earned $524 million, or $1.57 per share in line with Thomson Reuters forecast of $1.55 per share.
Shares of Northrop Grumman climbed 66 cents, or 1.4 percent, to $47.27 in early morning trade.
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