General Dynamics, the parent company of Bath Iron Works in Maine, saw its fourth-quarter profits drop 17 percent year-over-year, hitting $603 million on revenues of $9.15 billion.
GD, which employs roughly 7,000 in Maine its operations at BIW and at its Saco armaments division, said Wednesday that its quarterly profits were weighed down by high costs associated with its European air division.
While profits dipped, overall revenues for the quarter rose 6.3 percent from the fourth quarter of 2010.
From an Associated Press story:
The results missed Wall Street expectations, and its shares fell $1.09, or 1.5 percent, to $70.25 in premarket trading.
Analysts, on average, expected earnings of $1.99 per share on $9.31 billion in revenue, according to a FactSet poll.
The results included charges related to the company’s Switzerland-based aircraft-completions business totaling $189 million, including an asset impairment charge of $11 million and $78 million in contract losses.
For the full year 2011, General Dynamics reported net income of $2.53 billion, or $6.94 per share, down from $2.62 billion, or $6.88 per share, in 2010. Revenue edged up to $32.68 billion from $32.47 billion.
In related news, a Reuters story on the wires Wednesday reported that the Pentagon will unveil a budget this week that cuts $487 billion from defense over the next decade, but which may benefit BIW in Maine.
The cuts will trim the size of the military and scale back or drop some weapons programs, Reuters reported, including the Global Hawk unmanned surveillance plane built by Northrop Grumman Corp. and the country’s biggest weapons program, the F-35 Joint Strike Fighter, built by Lockheed Martin Corp.
The budget plan, Reuters reported, will begin to implement the administration’s new strategy (which I blogged about here) that would shift focus to the Asia Pacific region and the Middle East.
That move could help BIW, in particular, which has a sole customer – the U.S. Navy.
According to Reuters, the budget plan:
… will also propose multiyear procurements of more DDG-51 destroyers and Virginia-class submarines, both built by General Dynamics Corp and Huntington Ingalls, moves that could save about $4 billion by allowing bulk purchases of materials.
The DDG-51 is the destroyer that BIW makes, one of two yards in the country that does so.BIW also is making several of the next-generation destroyer, the DDG-1000, but that program appears to have been limited to a technology test-platform status for now, as the Navy re-focuses its energies on the DDG-51 ships, also known as Arleigh Burkes.