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Lockheed Profit Is Down by 15%

October 16, 1987|RALPH VARTABEDIAN

Lockheed's profit dropped 15% in the third quarter, compared to a year ago, as higher interest expenses on debt associated with the acquisition of Sanders Associates ate into higher profit from defense programs, the company said.

The Calabasas-based aerospace firm earned $101 million on sales of $2.7 billion in the third quarter, down from profit of $116 million on sales of $2.6 billion in the same period last year .

Profit in the third quarter was also adversely affected by a $9-million provision to cover anticipated losses owing to the company's effort to sell its shipbuilding operations in the Seattle area.

Lockheed Chairman Lawrence O. Kitchen said program profits have been higher in so-far 1987. In the third quarter, program profits were reported as $223 million, compared to $205 million last year.

Net earnings were also favorably affected by lower income taxes that resulted from a lower effective tax rate, the company said.

The company said it closed the quarter with a funded backlog of $8.7 billion, comparing that with $9.6 billion at the end of 1986.

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