Executive Mosaic is honored to introduce Phebe Novakovic, chairman and CEO of General Dynamics, as a winner of the 2023 Wash100 Award for leading the company to record-high backlog and strong order activity and overseeing efforts to meet the needs of defense customers amid the rapidly changing threat environment.
This recognition marks her ninth Wash100 win in the 10-year history of Executive Mosaic’s annual selection of the most influential government contracting figures from the public and private sectors.
Under the leadership of Novakovic, General Dynamics continues to report strong financial performance across its businesses.
During the third quarter of 2022, the company logged a profit of $902 million, 4.9 percent higher than the $860 million net earnings it reported over the same period in 2021. Revenue for the period rose 4.3 percent to $9.98 billion from $9.57 billion.
“We saw continued strong demand in the quarter, particularly in Aerospace, Combat Systems and Marine Systems,” said Novakovic. “Our businesses delivered solid operating performance and cash flow even as they managed through the challenges of inflation and supply chain constraints.”
The Reston, Virginia-based aerospace and defense contractor reported a profit of $3.39 billion for its 2022 fiscal year, up 4.1 percent from the prior-year period, and saw its fourth-quarter net earnings rise 4.2 percent to $992 million.
The company saw a record-high backlog of $91.1 billion at the end of calendar year 2022 as orders remained robust, and estimated a total contract value of $127.7 billion.
Notable awards for three defense segments during the quarter included a $5.1 billion U.S. Navy contract for the procurement and advance construction of a Columbia-class submarine and a $580 million contract to build and deploy adversarial electronic warfare threat systems in support of the Army’s test and training communities.
In calendar year 2022, General Dynamics received a potential $1.14 billion contract to produce and field up to 96 Mobile Protected Firepower vehicles for U.S. Army infantry brigades and a $1.15 billion order from the military branch to build modernized Abrams main battle tanks for Poland.
“We enjoyed a strong fourth quarter, capping a good 2022,” Novakovic said of the company’s financial performance. “We had good backlog growth, with robust demand at Gulfstream. Operating performance was solid, led by excellent execution at Combat Systems. We also had another very strong cash year.”
At the Jan. 25 earnings call, Novakovic told analysts that the changes in the threat environment have driven increased interest in Army and land forces capabilities, which she said reflected in the company’s backlog and order book.
“So, I think the closer you are to the threat, the more urgent you fill your funding requirements. So, all of which to say, we have changed our expectations for combat systems growth. By the way, overarching all of this is a need to increase our ammunition and projectile output. And we’ve been working with the Army for the last three, four, or five months on exactly that kind of plan,” she said.
“So, as we’ve always posited, the threat environment really drives this demand for defense products. And we’re seeing some of that now,” Novakovic added.
During the call, the chief executive offered updates on General Dynamics’ shipbuilding work. She noted that the company delivered two submarines in 2022 and is about to hand over two more units in 2023.
When asked about the Columbia-class submarine schedule, Novakovic said the company is “about 30% done on the first ship, and we are ahead of the contract schedule.”
Novakovic has been at the helm of General Dynamics since 2013. She previously held various leadership roles at the company, including president and chief operating officer, executive vice president of marine systems business and senior VP for planning and development.
She currently sits on the board of J.P. Morgan Chase & Co.
Executive Mosaic congratulates Phebe Novakovic and the General Dynamics organization for their selection to receive the 2023 Wash100 Award. Cast a vote now for your favorite GovCon champion at Wash100.com! Site visitors can select 10 executives for our Popular Vote rankings until April 28.