Lockheed credits IT for part of its growth
- By John Moore
- Jul 26, 2005
Lockheed Martin's information technology business helped fuel the company’s second quarter revenue growth, company officials said, in announcing the numbers.
The company reported second quarter sales of $9.3 billion, a 6 percent increase over the year-earlier quarter's $8.8 billion. Net earnings rose 56 percent during that period, from $296 million to $461 million. Diluted earnings per share grew 55 percent, from 66 cents to $1.02.
Company executives cited double-digit growth in the company’s Systems and IT Group as a factor in the company’s performance. Net sales for the group increased 17 percent for the quarter to $4.8 billion from $4.1 billion last year. The group was a major factor in the company's first quarter growth as well, when it brought in $4.1 billion.
Lockheed’s Information and Technology Services segment, which operates under the Systems and IT Group umbrella, experienced an organic growth rate of 15 percent for the quarter, said Chris Kubasik, Lockheed’s executive vice president and chief financial officer. The segment includes Lockheed Martin Information Technology, the company’s systems integration arm. Including the contribution of acquisitions, the growth rate for the quarter was around 33 percent, he added.
Kubasik said that the company is beginning to target business process outsourcing as an area of growth. The company acquired Affiliated Computer Systems’ federal unit in 2003 to bolster its efforts in this area. Lockheed earlier this year captured a $1.9 billion contract to operate the Federal Aviation Administration’s Automated Flight Services Station network.
The company’s share price rose about 2.6 percent to $64.15 by late afternoon following the earnings announcement.