Lockheed Martin posts profit increase in Q4, 2014

Lockheed Martin Corp. (NYSE:LMT), a Bethesda, Maryland–based defense contractor that employs about 4,200 people in Central New York, posted earnings gains in the final quarter of 2014 and the full year even as its revenue growth was not nearly as strong.

The company on Jan. 27 reported that net earnings from continuing operations soared to $904 million in the fourth quarter, compared to $488 million in the year-ago period. Lockheed earned $2.82 per share in the fourth quarter, compared to $1.50 a share in the year-earlier quarter.

The company operates plants in Salina and Owego that are part of Lockheed’s mission systems and training business.

The firm generated revenue of $12.5 billion in the fourth quarter, up from $11.5 billion in the fourth quarter of 2013.

For the entire year, Lockheed Martin earned $3.6 billion, or $11.21 per share, compared to $3 billion, or $9.04 a share, in 2013.

Revenue was flat last year, coming in at $45.6 billion in 2014, compared to $45.4 billion in 2013.

Cash from operations for 2014 totaled $3.9 billion after pension contributions of $2 billion, compared to cash from operations for 2013 of $4.5 billion after pension contributions of $2.25 billion.

Lockheed Martin finished “another strong year in 2014, achieving excellent financial and program performance,” Marillyn Hewson, chairman, president and CEO of Lockheed Martin, said in the firm’s earnings conference call on Jan. 27. 

“Our performance has the corporation well positioned to continue to deliver value to customers and stock holders in 2015 … The corporation continued to be successful in securing new order bookings for both domestic and international customers. In the fourth quarter, we achieved a strong, 130 percent book-to-bill ratio for contract award above sales and finished the year with a backlog of nearly $81 billion. This marks the fourth consecutive year that we have maintained our backlog in excess of $80 billion,” said Hewson. 

2014 in CNY

Lockheed Martin pursued more acquisitions in 2014 than it had done “historically,” in areas such as health-care information technology (IT) with the Oct. 30 announcement of its purchase of Salina–based Systems Made Simple. 

Systems Made Simple is a firm that provides health-information technology products to the federal government.

Earlier in the year, the U.S. Navy last May also awarded Lockheed and Sikorsky Aircraft Corp. a $1.26 billion contract to build a new fleet of Marine One helicopters that are used to transport the President.

Stratford, Conn.–based Sikorsky Aircraft Corp. is a subsidiary of United Technologies Corp. (NYSE: UTX).

But the firm also fell short in its pursuit of another high-profile contract.

Lockheed Martin had also pursued a U.S. Air Force radar contract, which the Air Force awarded to Waltham, Mass.–based Raytheon Co. (NYSE: RTN) with the sensor systems business unit of Saab Defense and Security USA, LLC of DeWitt, serving as the main sub-contractor.

The decision prompted Lockheed to issue a statement last Oct. 8, saying no changes are planned in its local operations because of the contract loss. The statement also laid out a plan to consolidate local facilities.