Lockheed sees higher earnings, weaker sales for 2013

Thu Jan 24, 2013 10:04am EST
 
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By Andrea Shalal-Esa

(Reuters) - Lockheed Martin Corp LMT.N, the Pentagon's biggest supplier, forecast 2013 earnings growth above analysts' estimates as it expects a record backlog and continued efforts to cut costs to overcome an anticipated weakening of sales.

Lockheed said on Thursday that earnings per share had dropped 19 percent to $1.73 in the fourth quarter from $2.14 a year earlier, reflecting a large noncash pension adjustment, higher income tax expenses and a charge for job cuts in its aeronautics division.

Excluding those one-time items, Lockheed earned $1.91 per share, beating the consensus view of analysts polled by Thomson Reuters I/B/E/S, who had forecast $1.82 per share.

Lockheed said it expected earnings per share to rise to between $8.80 and $9.10 in 2013 from $8.36 in 2012.

The company is assuming the U.S. Congress will avert $500 billion in additional Pentagon spending reductions known as "sequestration" that are due to take effect over the next decade, starting in March.

Chief Financial Officer Bruce Tanner told reporters on a conference call that it remained unclear how any additional cuts to the U.S. defense budget would be implemented, which made it difficult to forecast the coming year's results.

Chief Executive Officer Marillyn Hewson, who took over on January 1, told reporters the company's results in 2012 were "extraordinary" but that Lockheed remained focused on cutting costs and ensuring performance on key contracts.

Lockheed said fourth-quarter sales fell slightly to $12.1 billion from $12.21 billion.   Continued...