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General Dynamics Reports Third-Quarter 2012 Results
• Strong Aerospace activity drives revenues
• Cash from operations improves across the company
FALLS CHURCH, Va. –
General Dynamics (NYSE: GD) today reported third-quarter 2012 earnings from continuing operations of $600 million, or $1.70 per share on a fully diluted basis, compared with 2011 third-quarter earnings from continuing operations of $665 million, or $1.83 per share fully diluted. Revenues in the quarter were $7.9 billion. Net earnings for third-quarter 2012 were $600 million, or $1.70 per share fully diluted.
Company-wide operating margins for third-quarter 2012 were 11.4 percent, compared to 12.7 percent in third-quarter 2011. Margins in the most recent quarter include the impact of a $25 million charge in the Information Systems and Technology group to revalue a portion of its ruggedized-computer inventory.
Net cash provided by operating activities totaled $704 million in the quarter. Free cash flow from operations, defined as net cash provided by operating activities less capital expenditures, was $594 million or approximately 99 percent of earnings from continuing operations.
The company’s total backlog at the end of third-quarter 2012 was $51.5 billion, and the estimated potential contract value was an additional $26.1 billion, representing management’s estimate of value under unfunded IDIQ contracts and unexercised options.
Demand in the quarter was particularly strong for Aerospace products, including orders for every type of Gulfstream aircraft. Significant defense awards included a $340 million order to procure additional Warfighter Information Network-Tactical (WIN-T) equipment for U.S. Army units, $70 million for 13,000 additional Handheld, Manpack, Small Form Fit (HMS) Rifleman radios and accessories, and a $395 million contract for engineering development efforts for modernization of the Abrams main battle tank.
“General Dynamics made notable progress on several core programs in the third quarter, including certification of the Gulfstream G650 and G280, and successful evaluations of key tactical communications systems leading to additional production awards,” said Jay L. Johnson, chairman and chief executive officer. “The entire team at General Dynamics remains focused on efficient execution and maximizing profitability.”
General Dynamics, headquartered in Falls Church, Virginia, employs approximately 93,700 people worldwide. The company is a market leader in business aviation; land and expeditionary combat systems, armaments and munitions; shipbuilding and marine systems; and information systems and technologies. More information about the company is available on the Internet at www.generaldynamics.com.
Certain statements made in this press release, including any statements as to future results of operations and financial projections, may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements are based on management’s expectations, estimates, projections and assumptions. These statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. Therefore, actual future results and trends may differ materially from what is forecast in forward-looking statements due to a variety of factors. Additional information regarding these factors is contained in the company’s filings with the Securities and Exchange Commission, including, without limitation, its Annual Report on Form 10-K and its Quarterly Reports on Form 10-Q.
All forward-looking statements speak only as of the date they were made. The company does not undertake any obligation to update or publicly release any revisions to any forward-looking statements to reflect events, circumstances or changes in expectations after the date of this press release.
WEBCAST INFORMATION: General Dynamics will webcast its third-quarter securities analyst conference call at 9 a.m. Eastern Daylight Time on Wednesday, October 24, 2012. The webcast will be a listen-only audio event, available at www.generaldynamics.com. An on-demand replay of the webcast will be available by noon on October 24 and will continue for 12 months. To hear a recording of the conference call by telephone, please call 888-286-8010 (international: 617-801-6888); passcode 56400777. The phone replay will be available from noon October 24 until midnight October 31, 2012.