Northrop profit short of expectation Slump in stealth deliveries offsets electronics sales

February 08, 1996|By BLOOMBERG BUSINESS NEWS

LOS ANGELES -- Northrop Grumman Corp. yesterday posted lower-than-expected profit for the fourth quarter, hurt by fewer deliveries of the military contractor's B-2 stealth bomber.

Net income was $58 million, or $1.17 a share.

In 1994's final quarter, the company had a loss of $121 million, or $2.45, after taking $324 million of pretax charges for an accounting change and asset sales.

Per-share results fell short of the average forecast of $1.30 from nine analysts surveyed by Zacks Investment Research.

Sales declined 3.5 percent, to $1.81 billion from $1.88 billion, because of fewer deliveries of the B-2 stealth bomber and reduced demand for components for McDonnell Douglas Corp.'s F/A-18 program.

Those declines overwhelmed a 35 percent increase in sales in the company's electronics operations.

Northrop Grumman is banking on its recent $3 billion agreement to buy Westinghouse Electric Corp.'s Linthicum-based defense electronics operations to help it shift toward electronics systems for revenue and profit rather than military aircraft.

"It will place us in a significant growth mode for the future," said Kent Kresa, Northrop Grumman's chief executive.

Annual revenue could exceed $10 billion by the turn of the century, he said.

For all of 1995, the company reported net income of $252 million, or $5.11 a share, up from $35 million, or 72 cents, in 1994.

Results for 1994 reflect the $324 million of charges.

Revenue rose 1.6 percent, to $6.82 billion from $6.71 billion.

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