Lockheed Martin sales up but net income drops
Lockheed Martin, an aerospace and defense contractor with operations in San Luis Obispo, Santa Maria and Goleta, reported a 5 percent increase in net sales but a steep drop in net income for the quarter ended Sept. 24.
Sales rose to nearly $12.2 billion, primarily from the aeronautics and space systems segments, but net earnings fell by more than half to $939 million with the loss of around $1.3 billion in revenue from discontinued operations. Diluted earnings per share fell from $7.93 in the third quarter of 2016 to $3.24 in the most recent quarter.
“Our continued focus on operational performance and meeting our delivery commitments has enabled us to increase our financial guidance and post a record backlog that supports long term growth,” President and CEO Marillyn Hewson said in the Oct. 24 news release. “As we look ahead to 2018, we remain focused on delivering for our customers, investing in innovative solutions, and returning value to our shareholders.”
During the quarter, the company issued new senior unsecured notes to raise $1.6 billion at an interest rate of 4.09 percent, and capital expenditures reached $222 million. It also announced the expansion of its share repurchase program at the end of the quarter and increased its quarterly dividend by 10 percent after repurchasing 1.6 million of its shares for $500 million and paying a $522 million cash dividend to shareholders.
Lockheed said it expects net sales to increase 2 percent for fiscal year 2018, generating cash from operations of $5 billion or more. The company had cash and cash equivalents of $2.9 billion, with $13.1 billion in current liabilities.
Shares fell 2.6 percent during midday trading to $312.32 as of 11:25 a.m.
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