Defense contractor Lockheed Martin Corp. (LMT) reported Tuesday a profit for the second quarter that increased from last year, reflecting improved margins and sales growth. Both earnings per share and net sales came in above analysts' expectations. The company also raised its earnings forecast for the full-year 2012, while maintaining its annual revenue outlook.
"While the threat of sequestration has created uncertainty for our industry, we are maintaining an unwavering commitment to program execution and cost reduction throughout the organization," Chairman and CEO Bob Stevens said in a statement.
The Bethesda, Maryland-based company reported net earnings of $781 million or $2.38 per share for the second quarter, higher than $742 million or $2.14 per share in the prior-year quarter. In the prior year quarter, earnings from continuing operations was $748 million or $2.16 per share.
On average, 22 analysts polled by Thomson Reuters expected the company to report earnings of $1.91 per share. Analysts' estimates typically exclude special items.
Earnings for the latest quarter was reduced by $128 million or $0.39 per share, while the tear-ago quarter was reduced by $142 million, or $0.41 per share, both due to a non-cash FAS/CAS pension adjustment.
Net sales in the quarter increased 3 percent to $11.92 billion from $11.54 billion in the same quarter last year, and topped eighteen Wall Street analysts' consensus estimate of $11.29 billion.
Barring information systems & global solutions, all other segments - aeronautics, electronics systems and space systems - reported sales growth and operating profit in the latest quarter.
Net sales for aeronautics edged up 1 percent to $3.41 billion from last year, and electronic systems net sales grew 2 percent year-over-year to $3.67 billion.
Information Systems & Global Solutions net sales declined 4 percent to $2.26 billion from a year ago, while space systems net sales improved 18 percent to $2.38 billion in the year-ago quarter.
Total operating profit for the quarter increased 21 percent to $1.20 billion from $0.99 billion in the year-ago quarter, with margins expanded 150 basis points to 10.1 percent from last year's 8.6 percent.
Backlog at the end of the second quarter was $75.50 billion, compared to $80.70 billion at the end of December 31, 2011.
Looking ahead to fiscal 2012, the company raised its guidance for earnings from continuing operations to a range of $7.90 to $8.10 per share from the prior forecast in the range $7.70 to $7.90 range. However, the company continues to project net sales for the full year between $45 billion and $46 billion.
Street is currently looking for full-year 2012 earnings of $7.89 per share, on annual revenues of $45.69 billion.
LMT closed Monday's regular trading session at $86.91, up $0.22 on a volume of 1.20 million shares, lower than the three-month average volume of 1.76 million shares. In the past 52-week period, the stock has been trading in a range of $66.36 to $92.24.
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