Abu Dhabi, UAEMonday 27 May 2019

Lockheed Martin quarterly profit rockets

Results come as world’s largest defence contractor reaps the benefits from higher production of its F-35 jet fighter and a flurry of arms sales

Lockheed Martin's F-35 helped the company boost profit in the first quarter. Reuters
Lockheed Martin's F-35 helped the company boost profit in the first quarter. Reuters

Lockheed Martin on Tuesday reported a 47 per cent jump in quarterly profit and raised its 2019 earnings forecast, sending shares up 4.5 per cent before the bell, as the world’s largest defence contractor reaps the benefits from higher production of its F-35 jet fighter and a flurry of arms sales that have fattened its order backlog.

Earnings this year will be at least $20.05 a share, topping the high end of the previous forecast, the Maryland-based company said. Analysts had expected $19.60, according to the average of estimates compiled by Bloomberg.

Net earnings rose to $1.70 billion, or $5.99 per share, in the first quarter ended March 31, from $1.16bn, or $4.02 per share, a year earlier.

Net sales rose 23 per cent to $14.34bn, Reuters reported.

The backlog grew to a record $133.5 billion, up $3bn from the end of last year, as Lockheed closed a long-awaited $2.4bn missile defence sale with Saudi Arabia. New orders are expected to boost growth, pushing free cash flow to $5.3bn this year, according to Bloomberg Intelligence analyst Douglas Rothacker.

Lockheed is benefiting from higher production and repair activity of its advanced F-35, which helped spur a 27 per cent sales increase at the company’s aeronautics division.

Lockheed jumped 6.3 per cent to $335 ahead of regular trading in New York. The shares advanced 20 per cent this year through Monday, in line with the gain in a Standard & Poor’s index of aerospace and defence companies.

The United States is considering expanding sales of F-35 fighters to five new nations including Romania, Greece and Poland as European allies bulk up their defenses in the face of a strengthening Russia, a Pentagon official told Congress in early April.

Updated: April 23, 2019 04:26 PM

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