General Dynamics Press Release
General Dynamics (NYSE: GD – News) today reported first-quarter 2009 earnings from continuing operations of $593 million, or $1.54 per share on a fully diluted basis, compared with 2008 first-quarter earnings from continuing operations of $573 million, or $1.42 per share fully diluted. Revenues grew to $8.3 billion in the quarter, an 18 percent increase over first-quarter 2008 revenues of $7 billion. Net earnings for the first quarter of 2009 were $590 million, compared to $572 million in the first quarter of 2008.
“General Dynamics’ performance in the first quarter of 2009 was very strong,” said Nicholas D. Chabraja, chairman and chief executive officer. “Revenues grew at double-digit rates in all four segments of the company, with double-digit organic growth in our defense businesses, demonstrating the continued strength of demand among government customers for the products and services we deliver. The growth in Aerospace revenues is attributable to the acquisition late last year of Jet Aviation.”
Company-wide operating margins for the first quarter of 2009 were 11 percent, compared to 12.3 percent in the year-ago period. Marine Systems, however, increased operating margins by 90 basis points over the year-ago period to 9.8 percent, based on excellent performance on the Virginia-class, T-AKE, commercial product carrier, DDG-51 and DDG-1000 programs.
Funded backlog at the end of first-quarter 2009 increased 23 percent from one year ago, to $49.2 billion. The company’s total backlog at the end of the quarter was $71.1 billion, 43 percent higher than the $49.8 billion total backlog reported at the end of the year-ago period. In addition to the backlog, the estimated potential contract value, which represents management’s estimate of value under unfunded indefinite delivery, indefinite quantity (IDIQ) contracts and unexercised options, was $17.9 billion at the end of first-quarter 2009.
Net cash provided by operating activities from continuing operations in the quarter totaled $154 million. Free cash flow from operations, defined as net cash provided by operating activities from continuing operations less capital expenditures, was $73 million for the period.
“Cash provided by our defense businesses remained strong in the quarter, while the Aerospace group was a user of cash. We expect this to correct itself through the remainder of the year, such that free cash flow should approximate net income by year’s end,” Chabraja said.
“Looking ahead, we remain confident that General Dynamics is well-positioned to maximize the value of our $71 billion backlog as we continue to focus on excellent program execution and value creation for our shareholders,” Chabraja said.
General Dynamics, headquartered in Falls Church, Virginia, employs approximately 92,900 people worldwide. The company is a market leader in business aviation; land and expeditionary combat systems, armaments and munitions; shipbuilding and marine systems; and information systems and technologies. More information about the company is available on the Internet at www.generaldynamics.com.