General Dynamics Corp., the maker of Abrams battle tanks and Gulfstream business jets, said fourth-quarter profit rose 19 percent, aided by higher profits at its aerospace unit. Net income increased to $729 million, or $1.91 a share, from $614 million, or $1.57 a share, a year earlier, the Falls Church company said Wednesday. Analysts predicted earnings of $1.85 a share, the average of 20 analysts surveyed by Bloomberg. Sales gained 8.9 percent to $8.6 billion.
CEO Jay Johnson has said demand for Gulfstream jets is rising and the unit will witness double-digit sales growth this year. The company’s combat vehicles unit was dealt a setback when Defense Secretary Robert Gates on Jan. 6 proposed canceling the Marine Corps’ Expeditionary Fighting Vehicle; the loss may be offset by Gates’ proposal to upgrade Abrams and the Army’s Stryker vehicles, both also made by General Dynamics.
“We give the company credit for continuing to churn out earnings despite the top-line challenges,” said Joel Levington, a bond analyst at Brookfield Investment Management Inc. in New York.
General Dynamics, which also makes Virginia-class nuclear submarines, forecast profit this year of $7 to $7.10 a share, its first 2011 projection. Analysts’ average estimate was for profit of $7.10 a share on sales of $34.1 billion.
General Dynamics gained 47 cents Wednesday to close at $74.64 on the New York Stock Exchange. The shares gained 4 percent last year.
Sales at its aerospace unit rose 7.4 percent to $1.27 billion and operating profit rose 26 percent to $210 million, the company said. The unit delivered 44 planes during the quarter compared with 41 in the same period last year.
Combat systems sales rose 8.4 percent to $2.7 billion aided by a $500 million order from the U.S. Army for Stryker vehicles, the company said. Segment profits rose 9 percent to $400 million.
Information systems and technology unit revenue increased 9.6 percent to $2.94 billion, making it the largest of the four units. Segment profits increased 10.3 percent to $311 million.
Sales at marine systems, maker of submarines and destroyer ships, rose 9.7 percent to $1.7 billion and profit increased 13.5 percent to $177 million.
