Summary
General Dynamics Corporation (GD) reported strong revenue growth in 2019, reaching $39.4 billion, an increase of 8.7% over the previous year. This growth was driven by higher deliveries in the Aerospace segment, particularly the new Gulfstream G500 and G600 aircraft, and significant contract wins in the defense segments, including the record-setting Virginia-class submarine Block V contract. The company's operating earnings increased by 4.3% to $4.6 billion, and diluted earnings per share grew by 6.8% to $11.98. Despite a slight decrease in operating margin from 12.3% to 11.8%, largely due to the transition to newer, lower-margin programs, the company ended the year with a record backlog of $86.9 billion, signaling robust future demand across its diverse portfolio. Key financial highlights include a substantial increase in the Marine Systems segment's backlog due to the Virginia-class submarine contract and strong order activity for Gulfstream aircraft, particularly the new G700. The company continued to return value to shareholders through dividend increases and share repurchases. While facing some headwinds such as the initial lower margins on new programs and increased interest expenses related to the CSRA acquisition, GD demonstrated operational resilience and strategic positioning for continued growth in both its defense and aerospace businesses.
Financial Highlights
55 data points| Revenue | $39.35B |
| Cost of Revenue | $32.29B |
| Gross Profit | $7.06B |
| Operating Expenses | $34.78B |
| Operating Income | $4.57B |
| Interest Expense | $472.00M |
| Net Income | $3.48B |
| EPS (Basic) | $12.09 |
| EPS (Diluted) | $11.98 |
| Shares Outstanding (Basic) | 288.29M |
| Shares Outstanding (Diluted) | 290.84M |
Key Highlights
- 1Revenue increased by 8.7% to $39.4 billion in 2019, driven by Aerospace segment growth and strong defense contract awards.
- 2Operating earnings rose by 4.3% to $4.6 billion, with diluted EPS reaching $11.98, up 6.8%.
- 3Total backlog reached a record $86.9 billion, a 28.1% increase from 2018, reflecting strong future demand, particularly from the Virginia-class submarine program (Block V) and Gulfstream aircraft orders.
- 4Aerospace segment revenue grew 15.9% to $9.8 billion, aided by new aircraft deliveries (G500/G600) and a 57% increase in net orders for Gulfstream aircraft.
- 5Marine Systems segment revenue increased by 8.0% to $9.2 billion, largely due to higher volume on submarine and destroyer programs.
- 6Operating margin slightly decreased to 11.8% from 12.3% in 2018, primarily attributed to the lower initial margins on new product programs.
- 7The company repurchased 1.1 million shares in 2019 and increased its quarterly dividend for the 22nd consecutive year, demonstrating a commitment to shareholder returns.