General Dynamics Corporation
) announced second-quarter 2014 adjusted earnings of $1.88 per
share, surpassing the Zacks Consensus Estimate of $1.76 by 6.8%.
Earnings also increased 3.9% from the prior-year figure.
On a GAAP basis, the company's earnings per share were $1.58
versus $1.81 a year ago. The variance between GAAP and adjusted
earnings was due to a charge of 30 cents related to discontinued
operations for the sale of a business under the company's Combat
General Dynamics Corporation - Earnings
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In the second quarter, General Dynamics' total revenues of
$7,474 million missed the Zacks Consensus Estimate of $7,532
million by 0.8%. Total revenues were down 4.6% from $7,834 million
in the year-ago quarter.
The year-over-year decline was due to lower contribution from
the Aerospace, Combat Systems, and Information Systems and
Technology segments; partially offset by higher sales from the
Marine Systems segment.
The segment reported second-quarter 2014 revenues of $1,995
million, down 2.8% year over year. Operating income was $384
million, reflecting a decrease of 1.3% from $389 million in the
Segmental revenues decreased 0.5% year over year to $1,465 million.
Operating income from this segment was $220 million, up 0.5% from
$219 million in the prior year.
The segment's revenues of $1,851 million were 5.2% higher than
$1,759 million a year ago. Operating income from the segment was
$174 million, down 2.2% from the prior-year figure of $178
Information Systems and Technology:
The segment reported revenues of $2,163 million, declining 15.2%
from the year-ago quarter. Operating income from this segment was
down 5.1% year over year to $188 million.
In the quarter under review, General Dynamics' operating costs
and expenses decreased 5.1% year over year to $6,525 million.
The company's interest expenses increased 12.2% year over year
to $46 million.
Total backlog at the end of the second quarter was $71,093
million, up 44.2% year over year primarily due to higher backlogs
at Combat Systems and Marine Systems.
As of Jun 29, 2014, General Dynamics' cash and cash equivalents
were $3.8 billion versus $5.3 billion as of Dec 31, 2013.
Long-term debt as of Jun 29, 2014, was $3.4 billion versus $3.9
billion as of Dec 31, 2013.
During the first half of 2014, the company's cash flow from
operating activities was around $1.29 billion versus $1.09 billion
in the year-ago period. Free cash flow from operations was roughly
During the second quarter, General Dynamics repurchased 10.7
million shares worth $1.2 billion and disbursed around $0.2 billion
Rockwell Collins Inc.
) reported third-quarter fiscal 2014 earnings per share of $1.19,
beating the Zacks Consensus Estimate by a penny.
Lockheed Martin Corporation
) reported second-quarter 2014 earnings of $2.76 per share, beating
the Zacks Consensus Estimate of $2.66 by 3.8%.
The Boeing Company
) reported second-quarter 2014 adjusted earnings of $2.42 per
share, beating the Zacks Consensus Estimate by 19.8%.
General Dynamics' second-quarter earnings were well supported by
its cost control efforts and share repurchases, helping the company
beat the Street estimates in spite of soft revenues.
A sharp rise in backlog backed by significant improvement at the
Combat Systems and Marine Systems segments is expected to boost
General Dynamics' forthcoming results.
General Dynamics currently has a Zacks Rank #3 (Hold).
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