Lockheed Martin Outperforms In Q2, Boosts 2024 Projections On Strong Defense Sales

Lockheed Martin Corp LMT reported second-quarter 2024 net sales growth of 9% year-over-year to $18.12 billion, above the consensus of $17.04 billion.

Adjusted EPS of $7.11, up from $6.73 YoY, topped the consensus of $6.46.

The gross margin contracted 77 bps to 11.8%. The operating profit was $2.148 billion, and the margin contracted by 94 bps to 11.9%.

Aeronautics sales were $7.277 billion (+6% YoY), and the operating margin was 10.3%, down from 10.4% YoY.

Missiles and Fire Control sales of $3.102 billion (+13% YoY); operating margin was 14.5%, up from 13.5% YoY.

Rotary and Mission Systems sales of $4.548 billion (+17% YoY); operating margin 10.9%, down 70 bps. Space net sales of $3.195 billion (+1% YoY); operating margin 10.8%, up 90 bps.

Lockheed Martin generated cash from operating activities for the six months ended June 30, which stood at $3.511 billion, compared to $2.664 billion a year ago.

At the end of the quarter, LMT’s total backlog was $158.342 billion, a decline of 1.4% from December 31, 2023.

Also Read: C-130J Takes on New Role: Lockheed Martin Delivers Aerial Spray Aircraft

LMT returned $1.6 billion of cash to shareholders through dividends and share repurchases.

“We continue to demonstrate the impact of our 21st Century Security® strategy by harnessing the latest digital technologies to continuously improve mission effectiveness, strengthening and scaling the defense production system, and expanding industrial cooperation among our allies and partners. Consequently, demand for our defense technology solutions remains robust, with a backlog of nearly $160 billion, greater than two times annual revenue,” commented Lockheed Martin Chairman, President, and CEO Jim Taiclet.

“The year-to-date performance gives us confidence to raise our 2024 full-year outlook for sales, segment operating profit, and earnings per share. Operationally, the F-35 remains a top priority, and we recently delivered the first Technology Refresh 3-configured aircraft to the customer and anticipate deliveries for 2024 to meet our expected range of 75-110 F-35s,” added Taiclet.

FY24 Outlook, raised: Lockheed Martin expects net sales of $70.50 billion-$71.5 billion (prior $68.5 billion–$70 billion) versus the consensus of $69.822 billion.

LMT sees EPS of $26.10-$26.60 (prior $25.65 – $26.35) versus the consensus of $26.29.

The company sees Business segment operating profit of $7.35 billion-$7.50 billion (prior $7.175 billion – $7.375 billion), cash from operations of $7.75 billion – $8.05 billion, and free cash flow of $6 billion-$6.3 billion.

Also Read: Lockheed Prepares For Takeoff, Pentagon Plans To Restart F-35 Deliveries: Report

Price Action: LMT shares are trading higher by 1.85% at $483.31 at the last check Tuesday.

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