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Contact: Rob Doolittle
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General Dynamics Reports Third-Quarter 2013 Results
• Diluted EPS increases 8.2 percent over third-quarter 2012
• Operating margins grow to 12.3 percent
FALLS CHURCH, Va. –
General Dynamics (NYSE: GD) today reported third-quarter 2013 net earnings of $651 million, or $1.84 per share on a diluted basis, on revenues of $7.8 billion. This compares to 2012 third-quarter net earnings of $600 million, or $1.70 per diluted share, on revenues of $7.9 billion. Third-quarter 2013 operating earnings rose $52 million to $957 million, a 5.7 percent increase over the year-ago quarter.
Company-wide operating margins for the third quarter of 2013 were 12.3 percent, 90 basis points higher than third-quarter 2012 margins, reflecting operating-performance improvement in the company’s Aerospace, Combat Systems and Information Systems and Technology groups over the year-ago period. Marine Systems’ margins remained steady from second quarter to third quarter 2013 on the strength of current program performance, although they declined as expected from the year-ago period due to the completion of the long-running T-AKE program.
Net cash provided by operating activities in third-quarter 2013 totaled $467 million. Free cash flow from operations, defined as net cash provided by operating activities less capital expenditures, was $364 million in the quarter.
The company repurchased 1.6 million shares of outstanding common stock in the third quarter. Year-to-date, the company has repurchased 9.2 million shares. At its October meeting the company’s board of directors authorized management to repurchase up to 10 million additional shares.
Total backlog at the end of third-quarter 2013 was $47.9 billion, and the estimated potential contract value was an additional $27.4 billion, representing management’s estimate of value in unfunded indefinite delivery, indefinite quantity (IDIQ) contracts and unexercised options. Total potential contract value, the sum of all backlog components, was $75.4 billion at the end of the quarter.
Significant awards received in the quarter include $200 million to continue production and support of double-V-hulled Stryker combat vehicles for the U.S. Army, $150 million for continued production of Abrams tanks for a foreign customer and $140 million for equipment and services in support of the Army’s Warfighter Information Network-Tactical (WIN-T). Marine Systems was contracted to design and manufacture two commercial product carriers, and received a $280 million award for repair and maintenance of U.S. Navy LHA- and LHD-class ships.
“General Dynamics performed well in the third quarter, reflecting our focus on the basics of operational excellence,” said Phebe N. Novakovic, chairman and chief executive officer. “We remain committed to creating value by meeting our obligations to our customers while continuously improving the way we do business.”
General Dynamics, headquartered in Falls Church, Virginia, employs approximately 95,700 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. EDT on Wednesday, October 23, 2013. 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 12 p.m. on October 23 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 69201108. The phone replay will be available from 1 p.m. October 23 through October 30, 2013.