General Dynamic's IT sector earnings, revenue, dip slightly in 2011

General Dynamics Corp. reported $9.1 billion in fourth-quarter 2011 revenue, a 6.3 percent jump from the $8.6 billion in fourth-quarter 2010.

For the 12-month period, the corporation reported $32.7 billion, up from $32.4 billion in 2010, a 0.6 percent increase, according to a Jan. 24 company statement.

Fourth-quarter 2011 earnings from continuing operations was $603 million, or $1.68 per share on a fully-diluted basis, compared to 2010 fourth-quarter earnings from continuing operations of $729 million, or $1.91 per share fully diluted.

Information Systems &Technology sector revenue dipped slightly from $2.93 billion in fourth quarter 2010 to $2.92 billion in fourth quarter 2011, a 0.5 percent decline.

Quarterly operating earnings for IS&T rose 1.3 percent from $311 million in the fourth quarter 2010 to $315 million in the fourth quarter 2011.

For the 12-month period,  IS&T revenue fell from $11.6 billion in 2010 to $11.2 billion last year, a 3.4 percent decline year-over-year.

IS&T earnings also fell slightly from $1.21 billion in 2010 to $1.2 billion in 2011, or a 1.6 percent decline.

Full-year 2011 earnings from continuing operations totaled $2.55 billion compared to $2.63 billion for 2010.

The company's total backlog was $57.4 billion at the end of the year. In the fourth quarter, orders were particularly strong for combat-vehicle production and improvements, both domestically and internationally, the statement said.

Estimated potential contract value, representing management's estimate of the value of unfunded indefinite delivery, indefinite quantity contracts and unexercised contract options, increased to $28 billion at year-end 2011.

Total potential contract value, the sum of all backlog components, was $85.4 billion at the end of the year.

The General Dynamics statement said fourth-quarter earnings were affected by $189 million in charges taken at the company's aircraft-completions business in Switzerland.

"Jet Aviation's aircraft-completions business continued to face lower OEM business-jet volume and delays in several narrow-body and wide-body aircraft which are nearing delivery," Jay Johnson, chairman and CEO, said in the statement. "We have taken appropriate steps to address these issues.”

Johnson said the charges taken “mask an otherwise solid fourth-quarter performance by General Dynamics, marked by excellent cash generation, delivery of the first 12 Gulfstream G650 production aircraft to the final phase of manufacturing, and strong margins in our defense businesses."

Net cash provided by operating activities totaled $2 billion in the fourth quarter and $3.2 billion for the full year, the company reported.

General Dynamics Corp., of Falls Church, Va., ranks No. 5 on Washington Technology’s 2011 Top 100 list of the largest federal government contractors.

About the Author

David Hubler is the former print managing editor for GCN and senior editor for Washington Technology. He is freelance writer living in Annandale, Va.

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