General Dynamics Corp. — corporate parent of Gulfstream Aerospace — reported a rise in fourth-quarter profits of nearly 42 percent over the same quarter in 2013, with orders for Gulfstream business jets the highest in more than three years.
“Today we reported fourth-quarter earnings from continuing operations of $2.19 per fully diluted share, on revenue of $8.36 billion, and earnings from continuing operations of $737 million, up 18 percent over the fourth quarter 2013,” General Dynamics chairman and CEO Phebe Novakovic told analysts in a conference call Wednesday morning.
“It was our strongest revenue performance in the past 12 quarters, the highest operating earnings ever and the highest earnings from continuing operations,” she said.
“For us, it was a powerful quarter.”
Full-year earnings from continuing operations rose to $2.7 billion from $2.5 billion last year, Novakovic said. Diluted earnings per share for the year were $7.83, compared to $7.03 in 2013. Revenues for 2014 were $30.859 billion.
“It was a year of solid achievement, from both an operating perspective and the development of a solid backlog,” she said.
Gulfstream’s revenue and earnings were up in the fourth quarter compared to the same quarter in 2013. Sales were up 4.9 percent, or $105 million, and earnings were up $64 million, a significant 18.4 percent over 4Q 2013. Operating margins were at 18.4 percent, compared to 16.3 percent in the last quarter of 2013.
“Order activity in the quarter was robust, as one would expect with the announcement of two new aircraft – the ultrafast G500 and G600 were unveiled in
November — with funded backlog, total backlog and total potential contract value all up significantly,” she said.
“Even if we were to ignore orders for our two new aircraft, total orders for current production aircraft were the highest they have been in the year,” she said.
A shrinking delivery window for the G650 — now just under three years — has pushed sales of the company’s flagship jet up, while orders for the mid-cabin G280 also are on the rise, Novakovic said.
“The G450 and G550 demand has slowed somewhat, but not significantly. And we continue to see strong demand primarily in North America, with some growth in Asia and the Middle East,” she said.
“All in all, it was a very good year in aerospace.”
General Dynamics stock (NYSE: GD) closed at $136.40 Wednesday, down 80 cents.
GULFSTREAM BY THE NUMBERS
4Q2014 4Q2013 Varience
Revenues $2.24 billion $2.13 billion up 5 percent
Operating earnings $412 million $348 million up 18.4 percent
Operating margins 18.4 percent 16.3 percent
2014 2013 Varience
Revenues $8.6 billion $8.1 billion 6.5 percent
Operating earnings $1.6 billion $1.4 billion 13.8 percent