Summary
Northrop Grumman Corporation reported third-quarter and year-to-date results for the period ending September 30, 2011. The company experienced a decrease in total sales and service revenues compared to the prior year, primarily driven by lower sales across all operating segments. This revenue decline was attributed to reduced volumes on key programs, including space and aircraft programs in Aerospace Systems, and a reduced participation in the National Security Technologies (NSTec) joint venture impacting Technical Services. Despite the revenue decrease, operating income saw an increase due to performance improvements in the Aerospace Systems and Electronic Systems segments, alongside benefits from the NSTec participation change. The company also continued its share repurchase program and increased its quarterly dividend. A significant event during the period was the completion of the spin-off of its Shipbuilding business (Huntington Ingalls Industries) in March 2011, which is now reported as discontinued operations. This spin-off also resulted in a substantial cash contribution to the company.
Financial Highlights
48 data points| Revenue | $6.61B |
| Cost of Revenue | $2.85B |
| Gross Profit | $3.77B |
| Operating Income | $825.00M |
| Net Income | $520.00M |
| EPS (Basic) | $1.89 |
| EPS (Diluted) | $1.86 |
| Shares Outstanding (Basic) | 274.90M |
| Shares Outstanding (Diluted) | 279.30M |
Key Highlights
- 1Total sales and service revenues decreased by 6.5% to $6.61 billion for the third quarter and by 6.3% to $19.91 billion for the nine months ended September 30, 2011, compared to the prior year.
- 2Operating income increased by 14.1% to $825 million for the third quarter and by 15.1% to $2.48 billion for the nine months, driven by segment performance improvements and cost efficiencies.
- 3Diluted earnings per share from continuing operations rose to $1.86 in the third quarter and $5.34 for the nine months, up from $1.51 and $5.28, respectively, in the prior year.
- 4The company completed the spin-off of its Shipbuilding business (Huntington Ingalls Industries) on March 31, 2011, with its results now reported under discontinued operations.
- 5Shareholder returns included an increase in the quarterly common stock dividend to $0.50 per share and significant share repurchases totaling $2.64 billion for the nine-month period.
- 6Backlog stood at $42.0 billion as of September 30, 2011, a decrease from $46.8 billion at December 31, 2010, reflecting adjustments related to the NSTec joint venture and program restructurings.