Summary
Lockheed Martin Corporation's (LMT) 2017 10-K filing reveals a robust performance driven by its core defense business, with significant contributions from its Aeronautics and Missiles and Fire Control segments. The company reported net sales of $51.0 billion, a substantial increase driven by higher demand for aircraft and missile systems. The F-35 program remains a cornerstone, accounting for 25% of total consolidated net sales in 2017. Despite a significant non-cash tax charge related to the Tax Cuts and Jobs Act in the fourth quarter, which resulted in a net deficit in total equity, the company's operational performance remained strong. Looking ahead, LMT anticipates a low-single digit increase in net sales for 2018, with projected growth in tactical missile programs and improved performance in the Rotary and Mission Systems segment. The company continues to focus on program execution, affordability initiatives, and investing in new technologies. Key risks include dependence on U.S. government contracts, potential changes in government funding priorities, and competition. However, the company's diverse portfolio and strategic focus on critical national security priorities position it well for continued success.
Financial Highlights
52 data points| Revenue | $49.96B |
| Cost of Revenue | $43.59B |
| Gross Profit | $6.37B |
| R&D Expenses | $1.20B |
| Operating Income | $6.74B |
| Interest Expense | $651.00M |
| Net Income | $1.96B |
| EPS (Basic) | $6.82 |
| EPS (Diluted) | $6.75 |
| Shares Outstanding (Basic) | 287.80M |
| Shares Outstanding (Diluted) | 290.60M |
Key Highlights
- 1Net sales for 2017 reached $51.0 billion, a notable increase attributed to higher demand across key business segments, particularly Aeronautics and Missiles and Fire Control.
- 2The F-35 program was the largest single program, contributing 25% of total consolidated net sales in 2017, underscoring its critical role in the company's revenue.
- 3The company recorded a significant one-time net tax charge of $1.9 billion ($6.69 per share) in Q4 2017 due to the Tax Cuts and Jobs Act, resulting in a total equity deficit.
- 4Backlog remained strong at $99.9 billion at the end of 2017, providing visibility into future revenue streams.
- 5The company is strategically growing its international sales, which accounted for 30% of total net sales in 2017.
- 6Operating profit showed resilience, increasing to $5.9 billion, reflecting disciplined cost management and program execution.
- 7LMT repurchased approximately $2.0 billion of its common stock in 2017 and increased its quarterly dividend, demonstrating a commitment to returning capital to shareholders.