Northrop Grumman (NOC) Believes Better Is Ahead
Northrop Grumman (NOC) became the latest of the large defense contractors to report their most recent quarter’s earnings. While the company...UTC Bucks Trends And Is Positive For Next Year
United Technologies reported their earnings this week and while 2009 will see a decline they are positive about 2010. There is still some...General Dynamics Positive For 2009
General Dynamics saw a decline in earnings during the most recent quarter. Overall the company remains positive for 2009. Unlike some of the...Boeing Thinking Of Saving Money Through No Unions?
At the recent earnings call Boeing's CEO mused about building a new production line in right-to-work state South Carolina. He believes the...Lockheed Waiting For The F-35
Lockheed reported higher earnings for the most recent quarter but gave a warning that they expect 2011 and 2012 to see reductions in their...AugustaWestland Work Force Worried About VH-71 Contract
Filed under: Agusta Westland, Business Line, Companies, Congress, Contract Awards, Countries, Department of Defense, England, Events, Federal Budget Process, Italy, Lockheed Martin, Military Aviation, Restructuring, Services, U.S. Navy, development program, production program
While Finmeccanica has stated that they are not worried about the pending cancellation of the VH-71 new Presidential helicopter as proposed by Secretary Gates, there is concern at AugustaWestland’s facility in Yeovil, England. The local paper reports that if the program is ended there would be major cuts to the work force at that facility. AugustaWestland is not coming out and stating anything in this regard, but much of the work going on there supports the two phases of the program. As Finmeccanica has said Phase II has not yet started and that is why their earnings would not be effected in the next few years — no money has been spent on that part of the program. AugustaWestland makes the base helicopter which is then modified by Lockheed Martin in New York. The company would also provide support to the delivered aircraft. The contract while it is only for 23 aircraft is very large due to the cost of the individual platforms and the necessary modifications. The support contract would also be significant. The cancellation is just a recommendation right now and ultimately Congress will decide whether to end the program, restructure it, or just continue the current path.
EADS To Report Today
Filed under: Boeing, Business Line, Companies, Countries, EADS, Earnings, Events, France, Germany, Military Aviation, Northrop Grumman Corp., development program, logistics
One of the two largest aerospace companies in the world will report its annual earnings tomorrow. EADS is supposed to report a profit, although it has the A400M program hanging over its head. The troubled military transport now over two years late may cause a massive charge to the 2008 earnings Bloomberg.com writes. The way the original contract is written any of the seven customers can cancel the aircraft in the near future. If this program fails it will be the second major blow to the company in three years following the A380 delays and the financial hardship that caused the company. EADS had restructured in in a bid to fix the issues with their premier military program. EADS is also waiting to hear about the KC-X contract in the U.S. A contract that it had won in partnership with Northrop Grumman that was overturned on a protest by Boeing. EADS’ earnings for 2008 will be interesting, as there was so much potential there for a recovery from the losses caused by the delays in the A380.
Thales Has Off Year
Filed under: Business Line, Companies, Countries, EADS, Earnings, Events, France, Military Aviation, Thales, development program, production program
Thales the French defense contractor reported that in 2008 net profit fell thirty-six percent. CNNMoney.com writes that this is due higher taxes and a charge against the struggling A400M transport contract. Earnings did rise two percent this last year and revenue just one. The company paid high taxes because of a large capital gain in 2007. The A400M contract also required a charge of about $120 million. The company though feels that 2009 will be a good year as it has a large backlog. There was no discussion of the effect on the company if either the customers or EADS ends the A400M development program.
Unitech to be Purchased by Lockheed
Filed under: Acquisitions, Business Line, Events, Florida, IT, Lockheed Martin, Unitech, training
Lockheed Martin has agreed to buy Unitech sometime this year. Unitech is a smallish simulation producing company located in the Orlando area. The Orlando Sentinel reports that a deal to buy the company was worked out recently. Unitech complements the work that Lockheed has done in the simulation area in Orlando for years. The company has earnings of around $140 million, and it is common in these types of deals for private companies to pay about one year’s earnings for it. Many smaller defense contractors grow from one or two contracts to a size of between one to two hundred million and are then bought by another company. Larger companies buy them to gain work or expertise in a discipline or area that they might not have.
Solid quarter for Orbital
Filed under: Earnings, Orbital Systems, S&T, Satellites, development program, space
Orbital reported their third quarter results today. Revenues were up slightly while earnings were down. The company did report strong bookings and their back log is significant at over $2 B. The company saw increased activity in the launch vehicle and advanced space programs. There was a decline in satellites and space services. Orbital provides a variety of space related services to US DoD, Department of Energy and NASA.
See the full press release at MarketWatch.com.
CACI reports
Filed under: CACI, Department of Defense, Earnings, IT, S&T, SETA, logistics
In the continuing trend of large defense contractors resulting improved results, CACI had a 13% growth in earnings compared to the equivalent quarter a year ago. Forbes.com reports. CACI is a leading provider of services to the US intelligence community, especially the Defense side. They also provide other services to the US government such as IT and logistics management. Revenue growth was even more impressive, surging over 20% on large intelligence contracts.
For more see the story at Forbes.com.
Northrop Grumman continues strong performance of defense sector
Northrop Grumman continued the trend of the defense sector by reporting strong earnings and profits. See an article here. There had been some trepidation due to the taking back of the KC-45 contract. The company is able to still win this in December, and if it does it will contribute to further strong earnings and profits.
Boeing pays premium for unmanned aircraft partner
Filed under: Acquisitions, Insitu, Military Aviation, development program
Boeing had been working with Insitu, a Washington state company, on unmanned aircraft. Now it just bought the company. See an article here. Based on reports, Boeing payed quite a premium for the company. Insitu had an estimated earnings last year of $80 M and Boeing reportedly payed five times that for the company. Of course all this is based on anonymous reports as the details have not been made public yet. So if you were able to invest money in Insitu you made it back.
LMT reports earnings
Lockheed Martin continued the string of defense contractors reporting good earnings as the rest of the economy struggles. See a press release here. Lockheed had a 13% increase in profit over the last year with a solid increase in earnings. The company also is starting to sound cautious about the expected downturn if the Democrats win the White House in November. Even if the defense budget is cut dramatically it will take a few years for the effects to be felt within the suppliers.
Earnings and projections remain good for Boeing
Despite losing the KC-45 contract, and as we previously discussed here, Boeing announced solid earnings and projections this week. See the story here. Of course the key to all of this is the 787 Dreamliner. This civil aircraft once it begins deliveries will be the key to Boeing’s performance over the next several years.
Boeing’s role in defense aviation shrinks
Filed under: Boeing, Military Aviation, commercial aviation, development program
This good article in The Seattle Times summarizes how defense aviation is playing a less-and-less role in Boeing’s business. See the article here. It traces how from World War II on Boeing built large transports, tankers and bombers for the US Army Air Corps and Air Force. Now, with the loss of the KC-45 contract, they really are not doing any such business. They obviously rely primarily on their civil aircraft for the bulk of their earnings and profits. Boeing defense business is starting to be more and more in the area of engineering services and total program development and management. They were the Lead System Integrator (LSI) on what used to be called National Missile Defense (NMD) in the Nineties. They have also had similar roles in other major contracts.
KC-45 post on Seeking Alpha
Filed under: Boeing, Contract Awards, EADS, Northrop Grumman Corp., Protest, U.S. Air Force, commercial aviation, logistics, production program
I submitted a small article for Seeking Alpha on the KC-45 as a component of the future profit of either Boeing or EADS. The post reads: “Boeing lost out to EADS for the new airforce tanker contract. The KC-45 will be a version of the Airbus 330 transport aircraft. Boeing had proposed a version of the 767 aircraft. Boeing predicted in their Current Market Outlook 2007 that 28,600 new aircarft will be required to meet the growth in the airline industry by 2026. One would assume Boeing and EADS would get a large portion of these aircraft. The US Air Force will probably order less than 400 aircraft. So the tanker contract will be a small componenet of future production for Boeing or EADS, and a small component of earnings.”
Symmetricom Reports Second Quarter Fiscal Year 2010 Financial Results
Filed under: Syndicated Industry News
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