Northrop Grumman Q1 Profit Drops, Lifts FY Earnings View

(RTTNews) - Defense contractor Northrop Grumman Corp. (NOC) Wednesday said its first-quarter profit declined from the previous year that included a tax benefit. Sales improved with growth in three businesses. Further, the company lifted its earnings forecast for the year, while keeping the revenue outlook intact.

Wes Bush, chairman, CEO and president, said, "Our team is off to a strong start in 2015 with first quarter results that include solid margin rates at all four of our businesses. Strong operational performance, combined with our share repurchases, resulted in another solid quarter."

Net earnings declined to $484 million or $2.41 per share from $579 million or $2.63 per share in the year-ago quarter.

The prior-year results included a $0.23 per share, tax benefit resulting from the partial resolution of the Internal Revenue Service examination of the company's 2007-2009 tax returns.

On average, 14 analysts polled by Thomson-Reuters expected earnings of $2.27 per share for the quarter. Analysts' estimates typically exclude one-time items.

Pension-adjusted earnings per share for the quarter were $2.14, while it totaled $2.31 per share in the year-ago period.

Sales for the quarter rose to $5.96 billion from $5.85 billion in the same period last year. Analysts were looking for revenue of $5.76 billion.

In Aerospace Systems, sales improved 3 percent to $2.498 billion due to higher volume for unmanned and space programs.

Electronic Systems' sales were 2 percent higher at $1.681 billion, as volume increased for space sensors, marine systems and tactical sensors programs.

In Technical Services, sales climbed 10 percent to $770 million, principally due to growth in international programs and higher intercompany sales.

For fiscal 2015, Northrop Grumman now expects earnings per share in a range of $9.40 to $9.60, compared to its previous range of $9.20 to $9.50 per share. Analysts now expect earnings of $9.48 per share.

The company continues to expect sales of $23.40 billion to $23.80 billion. Street expects the firm to report revenues of $23.63 billion for fiscal 2015.

The stock closed at $160.51 on Tuesday.