Summary
Northrop Grumman Corporation (NOC) reported solid financial results for the nine months ended September 30, 2013. Total sales slightly decreased by 1% to $18.5 billion, primarily driven by a decline in the Information Systems segment, though partially offset by growth in Aerospace Systems and Electronic Systems. Net earnings saw a modest increase to $1.47 billion, with diluted EPS rising to $6.22, up from $5.67 in the prior year, reflecting improved operational efficiency and share repurchases. Despite an uncertain U.S. government budget environment marked by sequestration and potential government shutdowns, the company maintained a strong operating margin of 12.7% for the nine-month period. The company also demonstrated robust cash flow generation, with net cash provided by operating activities at $1.28 billion. NOC actively managed its capital structure, issuing new debt and continuing its share repurchase program, signaling confidence in its future performance and commitment to shareholder returns.
Financial Highlights
48 data points| Revenue | $6.11B |
| Cost of Revenue | $2.50B |
| Gross Profit | $3.61B |
| Operating Income | $790.00M |
| Net Income | $497.00M |
| EPS (Basic) | $2.18 |
| EPS (Diluted) | $2.14 |
| Shares Outstanding (Basic) | 228.20M |
| Shares Outstanding (Diluted) | 232.60M |
Key Highlights
- 1Total sales for the nine months ended September 30, 2013, were $18.5 billion, a slight decrease of 1% compared to the prior year, impacted by reduced sales in the Information Systems segment.
- 2Net earnings for the nine months increased to $1.47 billion, with diluted EPS rising to $6.22 from $5.67 in the same period last year.
- 3Operating income for the nine months was $2.36 billion, with an operating margin of 12.7%, showing operational efficiency improvements.
- 4Net cash provided by operating activities for the nine months was $1.28 billion, demonstrating strong cash generation.
- 5The company issued $2.85 billion in senior notes and continued its share repurchase program, authorized for up to $4.0 billion.
- 6Aerospace Systems segment saw sales increase by 3% year-over-year due to higher volumes in space and certain aircraft programs.
- 7The company highlighted potential risks related to the U.S. government's fiscal challenges, including sequestration and potential government shutdowns, which could impact future funding and operations.