Lockheed Martin Corp. reported a 16 percent jump in first-quarter profit yesterday as demand for fighter aircraft and information technology continued to boost sales.
The Bethesda defense contractor reported net income of $291 million (65 cents a share), compared with $250 million (55 cents) in the same period last year. Revenue increased 18 percent, to $8.3 billion, from $7.1 billion.
Lockheed, the Pentagon's largest contractor, also raised the upper end of its forecast for 2004 revenue to $34.8 billion from its previous estimate of $34.5 billion. The forecast does not include the delayed $2.2 billion acquisition of Titan Corp.; Titan is under investigation by the Justice Department.
"I'm trying to think back to a quarter as strong as this, and I am having a hard time," said Christopher E. Kubasik, Lockheed's chief financial officer. "It was a solid quarter."
Lockheed's shares closed at $46.88 yesterday, up 38 cents.
Fighter aircraft continued to be the company's largest and fastest-growing business. The aeronautics unit reported $2.9 billion in revenue, a 38 percent increase from $2.1 billion. The results were boosted by the development of the F-35 Joint Strike Fighter and the delivery of 15 F-16s to foreign customers. In the same quarter last year, Lockheed delivered three F-16s.
Lockheed's newest unit, Integrated Systems and Solutions, reported a 17 percent increase in revenue to $907 million compared with $772 million. The unit, which was established last year to use technology from the company's different areas for integrated proposals, said demand for "intelligence, defense and information assurance activities" boosted results. The results "validate for us that setting up the [IS&S] as a separate unit is paying off," Kubasik said.
Lockheed's information and technology services unit reported $852 million in revenue, a 24 percent increase from $687 million. The unit's results were boosted by last year's acquisition of the federal information technology unit of Dallas-based Affiliated Computer Services Inc. The ACS business has been fully integrated, and "we're seeing them contribute to our growth," Kubasik said.
Lockheed reported a $150 million non-cash expense in the quarter related to its pension plan, up from $72 million.