Defense contractor Raytheon announced on Thursday that net sales for the first quarter of the year had increased by nearly 10 percent over the same period in 2015. Earnings per share were down slightly.
Domestic missile sales were driven by the U.S. Air Force and Navy, both of which use Raytheon missiles in operations against the Islamic State. The company’s Paveway missiles, another driver of growth, are used for destroying fortified facilities, while the SM-6 is used by the Navy for ballistic missile defense.
The Massachusetts-based contractor made $5.8 billion in sales compared to $5.3 billion in the first quarter of last year, the company said in a statement. Earnings per share fell from $1.78 to $1.43, due in part to what the company said were acquisition accounting adjustments.
Raytheon is the world’s fifth-largest military contractor, with revenue coming primarily from contracts with the federal government. Growth was driven largely by advanced, medium-range, air-to-air missiles and missile systems, which accounted for just over $1.7 billion in sales, and space and airborne systems, which accounted for $1.45 billion.
The latter figure included $553 million for the Joint Polar Satellite System program for NASA, in addition to $650 million on international classified contracts and $470 million for domestic classified contracts.
The company also highlighted that after the quarter closed, its space and airborne division received a $1 billion award from the U.S. Navy for what it dubs “Next Generation Jammer” technology.
On Wednesday, the Defense Department announced three separate contracts involving Raytheon: $21 million for software upgrades involving the MQ-8 Fire Scout unmanned helicopter for the Navy; $19 million to support the Aegis ballistic missile defense system for the Navy and the government of Japan; and $12 million for an order involving the Evolved Sea Sparrow Missile target detection system.
“Raytheon had a good start to 2016 with bookings, sales, EPS and cash flow ahead of our expectations in the quarter,” said Chairman and CEO Thomas A. Kennedy. “Demand from our global customers continues to be strong, with particular strength in bookings from domestic as well as the Middle East and North Africa region.”
