Northrop Grumman Corporation reported sales for the second quarter decreased 9.6% to $6.56 billion, from $7.26 billion in the same quarter a year ago.
The results reflect the impact of lower U.S. Department of Defense (DoD) investment outlays including announced force reductions in overseas contingency operations. The top line was also hurt by the company’s reduced participation in the Nevada National Security Site (NSTec) joint venture and delayed awards for manned aircraft programmes.
Operating income in the reported quarter increased 12% to $841 million, from $750 million in the prior-year period, driven by an increase in net pension income. Overall, the company clocked net earnings of $520 million compared with $711 million in the second quarter of 2010.
Aerospace Systems Segment sales declined 9% year over year to $2.59 billion, principally due to lower volumes on manned aircraft programmes and civil space programmes. Contraction in manned aircraft volume reflects timing of awards for the F-35 and E-2 programmes, while lower civil space volume principally reflects the restructuring of National Polar-orbiting Operational Environmental Satellite System. Aerospace Systems’ operating income slipped 1.2% to $331 million.
The company lowered its sales expectation to $27 billion for 2011 from the prior estimate of $27.5 billion.
In March 2011, the company separated its Shipbuilding segment through a spin-off of its subsidiary, Huntington Ingalls Industries, which operates in major shipyards in Louisiana, Mississippi and Virginia.
Source: Zacks