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Litton Quarterly Earnings Are Below Expectations

September 04, 1997|From Bloomberg News

Litton Industries Inc. on Wednesday said its fiscal fourth-quarter earnings rose 3.2%, below analysts' expectations, hurt by weak results in its Navy shipbuilding business.

The Woodland Hills-based defense contractor and commercial electronics maker said net income rose to $44 million, or 93 cents a share, for the quarter ended July 31, from $42.7 million, or 89 cents, a year ago. The company was expected to earn 95 cents a share.

Litton shares still rose $2.25 to close at $53.13 on the New York Stock Exchange, as analysts said investors were looking ahead to the next two years, when Litton will benefit from defense businesses it recently bought.

The earnings disappointment "didn't faze me," analyst Eric Hunter of Standard & Poor's said. "They're still integrating recent acquisitions. The cost-reduction effects of those haven't come into play yet."

During the last year, Litton bought Science Applications International Corp.'s portable-computer business for an undisclosed amount, Racal Electronics' marine electronics businesses for $49 million, Sperry Marine Inc., a maker of marine navigation and guidance systems, for $158 million, and PRC Inc., a computer-network consulting company, for $425 million.

Litton's military-electronics business got a boost Wednesday as Textron Inc. selected the company to build avionics systems that will be installed in Textron helicopters used by the U.S. Marine Corps. In a statement, Litton said U.S. and foreign military sales of the systems could eventually exceed $650 million.

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