Lockheed Martin (LMT) reported better-than-expected revenue and profits for the third quarter of 2018. Total revenues increased 16% to $14.3 billion from the same period last year.
Net income improved to $1.5 billion or $5.14 per share versus $963 million or $3.32 per share in the prior-year period.
The company reported year-over-year sales increases across all its business segments. In the Aeronautics segment, sales increased 20%, driven mainly by increases in the F-35, F-16 and F-22 programs helped by higher volumes.
In Missiles and Fire Control, net sales improved 16%, primarily due to higher sales for tactical and strike missiles programs as well as sensors and global sustainment programs. The segment was negatively impacted by decreases in integrated air and missile defense programs.
Rotary and Mission Systems segment sales grew 14% in the quarter, helped by higher sales in the integrated warfare systems and sensors programs, C6ISR programs and the Sikorsky helicopter programs, driven once more by higher volumes.
In Space, segment sales rose 11%, driven primarily by higher sales in government satellite programs, strategic and missile defense programs and the Orion program.
Looking at the strong quarterly performance, Lockheed Martin updated its guidance for the full year of 2018. The company now expects net sales to be $53 billion, at the high end of its previous guidance of $51.6 billion to $53.1 billion. Diluted EPS is now expected to be $17.50, versus the prior outlook of $16.75 to $17.05.
For 2019, Lockheed Martin expects net sales to increase by around 5-6% from 2018. Total business segment operating margin is expected to be between 10.5-10.8% while cash from operations is expected to be greater than or equal to $7 billion.
This preliminary outlook is based on the assumption that the US government will continue to fund and support the company’s key programs, and any changes in the situation could lead to revisions in the numbers.
Defense programs to drive Lockheed Martin Q3 results
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In September, the company increased its quarterly dividend by $0.20 per share, to $2.20 per share, beginning with the dividend payment in the fourth quarter of 2018. Lockheed Martin also increased its share repurchase authority by $1 billion during the quarter.
Lockheed Martin’s shares were down 1.1% as of 11:30 am ET. The stock has climbed 1.2% thus far this year.