Lockheed Martin (NYSE: LMT) lifted full-year earnings and revenue guidance TuesdayÂ and exceeded analysts’Â second quarterÂ estimates for both figures on sales from the Sikorsky helicopter business acquired in NovemberÂ as negotiations between the company and U.S. government continue on the next twoÂ F-35 fighter jet batches.
Bethesda, Maryland-based Lockheed said it now expects 2016 earnings in theÂ $12.15-to-$12.45 per share range versus the previous $11.50-to-$11.80 outlook, with revenue at $50 billion-to-$51.5 billion compared to the prior $49.6 billion-to-$51.1 billion.
An increase in F-35 production and sustainment activities also helped boost second quarter sales and full-year guidance, Â Lockheed said.
These resultsÂ from the world’s largest defense contractor startÂ second quarter earnings season for companies listed inÂ Executive Mosaic’s GovCon Index of 30 government contractor stocks, which include theÂ U.S.’ top five primes that investors use to gauge the defense industrial base’s financial health.
Boeing (NYSE: BA), General Dynamics (NYSE: GD), Northrop GrummanÂ (NYSE: NOC) and Raytheon (NYSE: RTN) are scheduled to release second quarter results next week.
Lockheed’s second quarter earningsÂ came in at $3.32 per shareÂ to exceed analysts’ expectations by 39 cents and revenue increasedÂ 10.91 percent from the same period last year toÂ $12.91 billion, which tops theÂ consensus Wall Street forecast of $12.56 billion.
The company reportedÂ $1.02 billion in net profit for the April-June period to register a 9.9-percent year-over-year increase and second quarter free cash flow of $1.24 billion with 81 percent returned to shareholders via dividends and stock repurchases.
Sikorsky contributed $1.2 billion in additional revenueÂ for the second quarter and the company reiterated its expectations to complete the separation and eventual merger of its information systems and global solutions business into Leidos Holdings (NYSE: LDOS) during the third quarter.
Lockheed included its full-year IS&GS outlook into guidance and says it will adjust the forecast when the deal with Leidos completes.
The company also said it is negotiating final terms with the Defense DepartmentÂ on a contract for the next two lots — nine and 10 — of the F-35 aircraftÂ as the Air Force intends to declare initial operating capability for the jetÂ by the end of this year.
Lockheed reported $900 million of cash exposure and $3 billion in termination-liability exposure related to that F-35 contract the company expects to receive additional funds byÂ year end.
As of Monday’s close, shares in LockheedÂ have climbed 18.34 percent since the year started and risen 27.12 percent over 12 months.