Northrop Grumman Corp. said on Tuesday quarterly profit rose 22 percent, despite flat revenues, boosted by sales of surveillance planes and missile systems, which offset a sales decline in its ships division.
The Los Angeles-based defense contractor reported fourth-quarter net income of $331 million (92 cents per share), compared with $272 million (74 cents) for the like period a year earlier. Revenue rose to $7.86 billion from $7.85 billion in the year-prior period.
Analysts expected earnings of 83 cents per share on revenue of $7.85 billion.
Contract acquisitions for the fourth quarter declined by nearly half to $6.6 billion from $11.9 billion due to the delay in the passage of the 2006 defense budget, which slowed contract awards. Northrop’s total backlog of work fell to $56.3 billion at the end of 2005 from $58.1 billion a year earlier.
The company’s ships unit’s fourth-quarter sales, which include the financial results of the Newport News and Ship Systems sectors, declined 15 percent to $1.5 billion from the prior-year period, reflecting lower sales at Ship Systems due to damage from hurricanes that devastated its facilities on the Gulf Coast.
Integrated systems division’s sales increased 14 percent to $1.5 billion, the mission systems division’s sales rose 11 percent to $1.3 billion, and information technology sales edged up 4 percent to $1.4 billion from the fourth quarter of 2004.
For 2006, the company expects double-digit growth in earnings to between $4.25 and $4.40 per share on sales of approximately $31 billion, down from previous guidance of $32 billion. The decline is due to Northrop’s exiting the technology reselling business and selling off other small units.
Shares of Northrop rose 2.2 percent to settle at $62.08 on Tuesday.
