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Lockheed Earnings Soar 36% in Quarter

October 26, 2002|Peter Pae | Times Staff Writer

Lockheed Martin Corp., bolstered by a surge in orders for weapons and defense-related technologies, Friday posted a 36% jump in third-quarter earnings and said it was raising its financial forecast for the rest of the year.

The nation's largest defense contractor, benefiting from the biggest defense buildup in more than two decades, said net income for the quarter ended Sept. 30 jumped to $290 million, or 64 cents a share, from $213 million, or 50 cents, a year earlier.

The sharp rise was fueled by the Pentagon ramping up development of the firm's F/A-22 and F-35 fighter jets, the nation's next-generation combat aircraft, company executives said.

Sales at Lockheed's aeronautics division, which also makes F-16 fighter jets and military cargo planes, climbed 15% in the quarter and 35% for the first nine months.

The division includes operations in Palmdale, where about 4,000 engineers work at the supersecret Skunk Works developing classified aircraft. After downsizing for much of the 1990s, executives there foresee steady growth amid the uptick in defense spending. President Bush this week approved a 14% increase in the current fiscal year's defense budget, the largest jump in two decades.

In all, Lockheed's revenue in the third quarter climbed 5% to $6.54 billion from $6.22 billion last year.

The results were in line with analysts' expectations. Still, shares of the Bethesda, Md.-based company fell $2.47, or 4%, to $56.63 on the New York Stock Exchange after the earnings results were released, as investors fretted about Lockheed's pension fund income that has been battered by the bear market.

With growing orders, Lockheed said it now expects sales to reach $26 billion for 2002, up from a previous estimate of $25.4 billion to $26 billion.

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