Bloomberg News

General Dynamics Profit Rises Exceeding Analyst Estimates (1)

October 23, 2013

General Dynamics Corp. (GD:US), the U.S. government’s No. 3 contractor, reported third-quarter profit that rose 8.5 percent and beat analysts’ estimates.

Net income was $651 million, or $1.84 a share, up from $600 million, or $1.70 a share, a year earlier, the Falls Church, Virginia-based company said today in a statement. That compared with $1.68-a-share estimate (GD:US) of 19 analysts surveyed by Bloomberg.

The company raised its full-year profit forecast to $6.90 to $7 a share, up from the previous outlook of $6.85 to $6.95. The guidance assumes “there is no residual impact” from this month’s partial U.S. government shutdown, Phebe Novakovic, the contractor’s chief executive officer, said on a conference call with analysts and investors.

Sales fell 1.7 percent to $7.8 billion in the quarter from a year earlier. The company reported a backlog of $47.9 billion at the end of the quarter, compared with $49.4 billion at the end of the second quarter.

General Dynamics fell less than 1 percent to $87.46 at 9:40 a.m. in New York trading.

Business Jets

Higher sales of General Dynamics’ Gulfstream business jets have helped offset some of the declines in military revenue.

Across-the-board federal budget cuts stripped $37 billion from Pentagon programs in the year ended Sept. 30 and will cut about $50 billion from planned spending in the current fiscal year.

General Dynamics, which makes Abrams tanks, has risen 27 percent this year through yesterday. The Standard & Poor’s 500 Index gained 23 percent during the same period.

The No. 1 federal contractor, Lockheed Martin Corp. (LMT:US), yesterday raised its full-year forecast as its third-quarter profit rose 16 percent.

United Technologies Corp. (UTX:US), the No. 6 contractor, yesterday reduced its sales forecast for the year. The Hartford, Connecticut-based company said Pentagon spending cuts contributed to a decline in sales.

To contact the reporter on this story: Jonathan D. Salant in Washington at jsalant@bloomberg.net

To contact the editor responsible for this story: Stephanie Stoughton at sstoughton@bloomberg.net


Hollywood Goes YouTube
LIMITED-TIME OFFER SUBSCRIBE NOW

(enter your email)
(enter up to 5 email addresses, separated by commas)

Max 250 characters

Companies Mentioned

  • GD
    (General Dynamics Corp)
    • $123.39 USD
    • -0.60
    • -0.49%
  • LMT
    (Lockheed Martin Corp)
    • $174.1 USD
    • -2.42
    • -1.39%
Market data is delayed at least 15 minutes.
 
blog comments powered by Disqus