Lockheed’s space division leads strong quarter
A series of milestones related to Lockheed Martin’s space and F-35 fighter jet programs helped lead a strong quarter for the defense giant, which announced financial results Tuesday.
CEO Marillyn Hewson said the completion of the Orion crew capsule, a milestone marked Saturday on the Space Coast by Vice President Mike Pence, will serve as a big driver for the company.
“It’s part of the (backbone) for our nation’s plan for deep-space exploration and NASA’s Artemis program,” she said, noting that Orion recently successfully navigated an abort test. “We are proud to continue our legacy in space exploration by supporting the Orion program and building the safest spacecraft ever built.”
Lockheed’s crew capsule is expected to eventually ferry astronauts to the moon and beyond. An uncrewed test flight could take off as early as next year but could also be delayed into 2021.
Lockheed reported an 11 percent jump in quarterly sales in its space division over last year as overall net earnings jumped 18 percent over last year.
The company was recently caught in the crossfire of international political squabbles, as President Donald Trump has considered potential sanctions against Turkey over that nation’s recent deal to buy a Russian missile-defense system.
Trump said the U.S. would withhold sales of the F-35 stealth fighter jet to Turkey because of that deal.
“We will continue to follow any official guidance,” Hewson said, calling Turkey’s order volume in upcoming years as “modest.”
The company, she said, also has a “handshake agreement” with the Department of Defense for 478 jets, which represents the largest order in the department’s history.
In addition, Hewson announced that the cost of producing an F-35 dipped below $80 million, crossing a threshold the company had targeted during its last earnings call in April.
On the strength of its F-35 program and a series of contracts related to missile-defense systems, Chief Financial Officer Ken Possenriede said the company’s Missiles and Fire Control, one of two Lockheed Martin divisions that employ people in Orlando, would likely be its strongest moving forward.
Lockheed Martin employs more than 8,000 people in its Central Florida locations, which includes two major operations in Orlando.
Both divisions saw an increase in sales, as Missiles and Fire Control reported a 13.5 percent jump and Rotary and Missions Systems was up 5.7 percent.
The company’s stock spiked briefly upon the results being released, jumping from $357.36 per share at close on Monday to $362.50 upon opening. That increase was quickly wiped out and shares closed at $357.80 at the closing bell.
Hewson said the company had a strong operational quarter “across all four of our businesses,” creating a backlog in orders that reached “a new record level.”