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Northrop Grumman Reports Drop in Q1 Earnings, Raises Full-Year Outlook

Strategic Insights

— 1 min read

Despite a 8.4% drop in earnings due to pension costs, Northrop Grumman reported an increase in revenue to $6 billion, beating analyst expectations. The company's aerospace systems division saw a 3% sales growth, driven by higher volumes in unmanned and space programs. However, military aircraft volume declined due to lower demand for the F/A-18 program. Northrop's order backlog rose to $38.4 billion, up from $38.2 billion in December, with new awards totaling $6.1 billion.

Key Takeaways:

  • Northrop Grumman reported a drop in Q1 earnings to $2.41 per share, including a 23-cent per-share tax benefit and a 27-cent per-share pension adjustment.
  • Revenue rose 1.9% to $6 billion, beating analyst expectations of $5.7 billion.
  • Sales from the aerospace systems division grew 3% due to higher volumes in unmanned and space programs.
  • Military aircraft volume declined due to lower demand for the F/A-18 program.
  • Northrop Grumman raised its full-year EPS outlook to $9.40 to $9.60, an increase from its January estimate of $9.20 to $9.50.
  • The company reaffirmed its revenue outlook of $23.4 billion to $23.8 billion this year.

Statistics:

  • Earnings per share (EPS) dropped 8.4% to $2.41 in Q1.
  • Revenue increased by 1.9% to $6 billion.
  • Sales from aerospace systems division rose 3% to an unspecified amount.
  • Order backlog rose to $38.4 billion at the end of March.
  • New awards totaled $6.1 billion.
  • Full-year EPS outlook raised to $9.40 to $9.60.
  • Revenue outlook maintained at $23.4 billion to $23.8 billion.

Sources:

  • "Northrop Grumman reported a drop in first-quarter earnings" (Investor's Business Daily)
  • Northrop Grumman earnings call (March 2015)
  • Thomson Reuters analyst estimates (January 2015)

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