Northrop Grumman Corp. said Thursday that its second-quarter net income fell 20 percent as the defense and aerospace contractor reported higher pension charges and saw weaker results at its shipbuilding unit.

The Los Angeles company reported net income of $394 million ($1.21 per share), compared with $495 million ($1.44) a year ago.

Revenue rose 3.8 percent to $8.96 billion. The company’s aerospace business grew more than 8 percent on higher orders in its manned and unmanned aircraft programs. Shipbuilding revenues were down 10 percent due to adjustments to the cost of completion for certain products. The company also saw a $145 million increase in net pension expense.

Adjusted net income from continuing operations was $443 million ($1.36), beating expectations of analysts polled by Thomson Reuters who were looking for $1.29 per share.

Chief Executive Ronald Sugar affirmed the company’s full-year outlook and said it was taking “aggressive actions” to improve its shipbuilding business on the Gulf Coast. New business awards in the quarter totaled $7.5 billion.

“Overall, our portfolio continues to perform well,” Sugar said in a statement.

Northrop shares were down $1.38, or 3 percent, to $45.75 in midday trading on the New York Stock Exchange.