01—Abstract
Summary
Summary of the 10-K filed February 14, 2014. Cited figures are marked; the original filing is the authoritative source.
Lockheed Martin Corporation (LMT) reported net sales of $45.36 billiona for the fiscal year ending December 30, 2013.
The company, a global security and aerospace leader, derives the vast majority of its revenue (82%b) from U.S. Government contracts, with a significant portion (61%) coming from the Department of Defense. The company operates across five key segments: Aeronautics, Information Systems & Global Solutions (IS&GS), Missiles and Fire Control (MFC), Mission Systems and Training (MST), and Space Systems. Despite a challenging economic environment and U.S. government budget pressures, including sequestration, LMT demonstrated resilience.
The company's backlog remained strong at $82.6 billionc at year-end 2013. Strategic focus areas for the company include program execution, improving delivery quality, developing capabilities for customers, and expanding international sales.
LMT is also actively managing its portfolio through acquisitions and consolidating facilities to align with future workloads and enhance affordability. The company returned significant value to shareholders through dividends and share repurchases.
02—Key points
Key Highlights
- Net sales for the fiscal year ended December 30, 2013, were $45.36 billion.
- 82% of net sales were derived from U.S. Government contracts, with 61% from the Department of Defense.
- The company's backlog remained substantial at $82.6 billion at the end of 2013.
- Lockheed Martin operates across five key business segments: Aeronautics, IS&GS, MFC, MST, and Space Systems.
- The company announced plans to close and consolidate facilities, impacting approximately 4,000 positions, to improve affordability and align with future workloads.
- Lockheed Martin returned $1.5 billion in dividends and $1.8 billion in share repurchases to shareholders in 2013.
- The company's stock price saw a significant increase, trading between $85.88 and $149.99 during 2013.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2013, Lockheed Martin kept $0.07.
- Revenue$45.36B100.0%
- Cost of revenue−$41.17B90.8%
- Gross profit$4.19B9.2%
- Operating costs$318.0M0.7%
- Operating income$4.50B9.9%
- Interest, other & tax−$1.52B3.4%
- Net income$2.98B6.6%
04—Financials
Financial Highlights
Figures from 10-KFY2013filed February 14, 2014Financial Statements
FY2013 against FY2012
| Line item | FY2013FY2012 | Change |
|---|---|---|
| Revenue | $45.36B$47.18B | −3.9% |
| Cost of Revenue | $41.17B$42.99B | −4.2% |
| Gross Profit | $4.19B$4.20B | −0.2% |
| R&D Expenses | $697.00M$616.00M | +13.1% |
| Operating Income | $4.50B$4.43B | +1.6% |
| Interest Expense | $350.00M$383.00M | −8.6% |
| Net Income | $2.98B$2.75B | +8.6% |
| EPS (Basic) | $9.29$8.48 | +9.6% |
| EPS (Diluted) | $9.13$8.36 | +9.2% |
| Shares Outstanding (Basic) | 320.90M323.70M | −0.9% |
| Shares Outstanding (Diluted) | 326.50M328.40M | −0.6% |
05—Questions
Frequently Asked Questions
What was Lockheed Martin's primary source of revenue in 2013?
Lockheed Martin's primary source of revenue in 2013 was U.S. Government contracts, which accounted for 82% of its net sales. Of this, 61% came specifically from the Department of Defense.
How did the company manage its operations amidst U.S. government budget constraints and sequestration?
Lockheed Martin focused on program execution and affordability initiatives. The company announced plans to close and consolidate facilities and reduce its workforce by approximately 4,000 positions to better align its cost structure with projected workloads and the changing economic landscape. Despite these pressures, the company maintained a strong backlog and continued to invest in technology and its people.
What is the significance of the company's backlog?
The backlog represents firm orders for products and services that will be converted into sales in future periods. At December 31, 2013, Lockheed Martin's backlog was $82.6 billion, providing a significant base for future revenue and indicating continued demand for its offerings.
How did Lockheed Martin return value to shareholders in 2013?
In 2013, Lockheed Martin returned value to shareholders through $1.5 billion in dividends and $1.8 billion in share repurchases, demonstrating a commitment to returning capital to investors.
06—Continue