Aerospace giant Lockheed Martin Corp. posted a first-quarter net loss yesterday of $87 million, or 23 cents a share, and senior executives said the company has its work cut out for it to meet earnings expectations this year.
The company attributed the first-quarter loss to a $355 million accounting charge, increased expenses in its new global telecommunications business and setbacks in a space program.
For the same quarter a year ago, the company posted net income of $269 million, or 71 cents per diluted share.
Sales for the quarter dipped slightly to $6.19 billion from $6.22 billion in the same quarter of 1998.
Vance Coffman, Lockheed Martin's chairman and chief executive officer, said the first-quarter results "were not as good as we'd like them to be."
Looking ahead, Coffman said expectations for full-year earnings would depend on the delivery of aircraft orders, successful spacecraft launches and "certain cost and operational issues."
Philip Duke, the company's chief financial officer, told analysts in a conference call that the company was working on production costs of its C-130J transport planes.
The Bethesda company also booked a one-time after-tax gain of $74 million from the sale of 4.5 million shares of L-3 Communications Holdings Inc.
Without the charge and the gain, the company said its first-quarter profit from operations would have been $194 million, or 51 cents a share. That represents a 28 percent decline from the same quarter a year ago, but met analysts' estimates.
Duke, the financial officer, told analysts that the company believes it is on track to meet year-end earnings of $3.36 per share, but could revise that figure up or down 10 percent in June or July, depending on cost and performance issues in some programs.
"I don't think they restored anyone's confidence with communicating there's a 10 percent downside risk," said Glenn Stewart, an analyst at AG Edward & Sons Inc.
The company said yesterday that it was continuing to move forward with its proposed $3.16 billion purchase of another Bethesda company, Comsat Corp., the satellite company originally created by the federal government.
The move is opposed by a Comsat competitor and the Justice Department has raised questions about it.
Lockheed said that at the end of the quarter it had $45.7 million in backlogged orders, compared with $45.3 million at the same time a year ago.
Shares of Lockheed closed yesterday at $39, down 75 cents.
Bloomberg Business News contributed to this article.
Pub Date: 4/21/99