By Mike Stone
(Reuters) – U.S. weapons maker Lockheed Martin Corp increased its outlook for 2021 sales and profit as it reported better-than-expected quarterly profits on Tuesday, helped by higher sales and profits at its unit which makes ships and helicopters.
Though the maker of the F-35 fighter jet increased the midpoint of its full-year revenue outlook slightly to $68 billion, the estimate is below Wall Street’s average estimate of $68.17 billion.
One big potential dampener for defense companies’ profits was removed earlier this month when U.S. President Joe Biden’s proposed a flat defense budget for 2022 despite calls from progressive Democrats to reduce Pentagon spending.
“In relation to the president’s budget, that was in line with our expectations. And we believe once we get more details, we’ll see that a lot of our programs are in line with what our customers want,” Ken Possenriede, Lockheed’s chief financial officer, said in a telephone interview.
The Bethesda, Maryland-based company said it now expects full-year earnings per share to be in the range of $26.40 per share to $26.70 per share, a range with a midpoint that would beat analysts’ expectation of $26.31 per share, according to IBES data from Refinitiv.
Net earnings for the quarter which ended on March 28 rose from $1.7 billion in the same period a year ago, to $1.8 billion, or $6.56 per share, beating analyst estimates of $6.31 per share.
The company’s Aeronautics segment reported 17 deliveries of its F-35 jets in the quarter, down from 22 a year earlier. Lockheed plans to deliver between 133 and 139 of the jets this year, said Possenriede.
Though net sales in the quarter rose 3.9% to $16.26 billion, they were below analysts’ expectation of $16.33 billion.
(Reporting by Mike Stone in Washington; Editing by Sonya Hepinstall)
