Earnings Report: General Dynamics

Published January 24, 2013 by Jessica Sabbath

THE TAKE: It continues to be a tough environment for government contractors. Falls Church-based General Dynamics reported a $2.1 billion loss for the fourth quarter as it took a goodwill impairment in its Information Systems and Technology (IS&T) group based on slowing defense spending. Revenues fell 11.7 percent to $8.1 billion.

THE NUMBERS:

Fourth-quarter revenue: $8.1 billion, down 11.7 percent from $9.1 billion in the fourth quarter of 2011
2012 revenue: $31.5 billion, down 3.6 percent from $32.7 billion in 2011.

Fourth-quarter loss: $2.1 billion compared with a profit of $603 million in same the same period in 2011.
2012 profit: Net loss of $332 million in 2012, compared with a profit of $2.5 billion in 2011.

Fourth-quarter earnings per share: Loss of $6.07 per diluted share
Full-year earnings per share: Loss of 94 cents per diluted share

THE COMPANY’S TAKE: Phebe N. Novakovic, chairman and chief executive officer of General Dynamics, said: “General Dynamics’ operating results in 2012 and the charges that we have recorded in the fourth quarter reflect the fact that some of our markets are contracting as government budgets shrink at home and abroad.  They also suggest opportunities for improvement in some areas of our performance, which we are addressing.
“General Dynamics is a strong corporation with relevant product and service offerings that are critical to our customers’ missions.  We will continue to manage our business aggressively as we approach the opportunities and the challenges of the future,” she said.