Northrop Grumman Raises Forecast
October 26 2016 - 8:00AM
Dow Jones News
Northrop Grumman Corp. upped its forecast for the year and beat
Wall Street expectations for the latest quarter as an increase in
its aerospace sales bolstered its financial results.
Shares rose 2.5% in light premarket trading.
For the year, Northrop said it now expects earnings per share of
between $11.55 and $11.75, compared to between $10.75 and $11
previously. It expects 2016 revenue of between $23.9 billion and
$24.1 billion, up from between $23.5 billion and $24 billion
previously. Analysts polled by Thomson Reuters had expected
earnings per share of $11.05 on revenue of $23.82 billion.
The Falls Church, Va., contractor late last year won a
hard-fought contest to build new long-range bombers for the U.S.
Air Force, beating out Boeing Co. and Lockheed Martin Corp. for a
contract valued at roughly $80 billion. In September, the air force
said the bomber would be called the Raider.
In the latest quarter, higher volume for manned aircraft and
autonomous systems programs pushed revenue in its aerospace
business 9.4% higher to $2.78 billion. Manned aircraft sales rose
on higher volumes for classified programs, where the company isn't
allowed to disclose more details, and on the F-35 and E-2D
aircrafts, partially offset by fewer F/A-18 deliveries. Autonomous
systems sales increased on higher volume in the triton and global
hawk program, partially offset by lower volume on North Atlantic
Treaty Organization alliance ground surveillance as it ramps down.
Lower volume on the advanced extremely high frequency program lead
to a fall in space sales.
Sales of mission systems fell 0.9% to $2.7 billion on lower
volume for sensors and processing programs and advanced
capabilities programs, partially offset by higher volume for cyber
and ISR programs.
In all, Northrop reported a profit of $602 million, or $3.35 a
share, up from $516 million, or $2.75 a share, a year prior. The
company said results were impacted by a federal tax benefit of 23
cents and a 20 cent benefit for two unallocated corporate
items.
Revenue grew 2.9% to $6.16 billion. Analysts projected $2.81 in
adjusted earnings per share and $6.02 billion in sales, according
to Thomson Reuters.
Write to Austen Hufford at austen.hufford@wsj.com
(END) Dow Jones Newswires
October 26, 2016 07:45 ET (11:45 GMT)
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