General Dynamics posted significant increases in net earnings and net sales in the third quarter, the Falls Church defense contractor reported Wednesday.
Strong demand for combat systems, as well as with aerospace systems, accounted for much of the growth.
Profits for the Falls Church defense contractor jumped 25 percent to $546 million, or $1.34 per share, from $438 million, or $1.08 per share, a year earlier. Revenue increased 13 percent from $6.1 billion to $6.8 billion.
The numbers exceeded Wall Street expectations by about 7 percent, said Paul Nisbet, the principal analyst with JSA Research Inc. “The growth potential is somewhat stronger than I had originally thought. [General Dynamics] could end up being one of the companies with the strongest growth in the defense sector,” Nisbet said.
All four of the company’s business groups generated net sales growth in the July-to-September quarter compared with the third quarter of 2006.
The combat systems group was boosted with a $338.7 million U.S. Marine Corps contract for 600 armored vehicles for the Mine Resistant Ambush Protected vehicle program, with growth in soldier protection systems, tanks, and Striker machine gun systems.
Net sales in the combat systems group jumped 37 percent from $1.4 billion to $1.9 billion, with operating earnings spiking 39 percent from $164 million to $228 million.
The aerospace division grew 21 percent to $1.3 billion, marine systems climbed a slight 2 percent to $1.23 billion, and information systems and technology was virtually flat with 0.2 percent growth, remaining at about $2.4 billion.
Chairman and Chief Executive Nicholas D. Chabraja was reluctant to provide specific projections for 2008, citing ongoing congressional negotiations over the supplemental spending bill.
The company “will have a good year in combat systems,” he said, but “the question is how good.”
