Lockheed posts profit above estimate

Lockheed Martin, the Pentagon's largest arms supplier, reported a better-than-expected 4.5 per cent rise in quarterly profit and said it could spin off or sell its government IT and technical services businesses.

The company also said it would buy Black Hawk helicopter maker Sikorsky Aircraft from United Technologies Corp for $9 billion.

The strategic review of its businesses represents about $6 billion in expected 2015 sales and 17,000 employees, Lockheed said.

The company, which had 112,000 employees as of December 31st, said it expects to complete the review in 2015.

Lockheed, which reported quarterly results a day earlier than scheduled to coincide with the announcement of the Sikorsky acquisition, raised its earnings per share forecast for 2015 to $11.00-$11.30 from $10.85-$11.15.

US weapons makers have been increasing sales to international markets to offset weak government spending at home.

Lockheed said in February foreign sales would account for about 25 per cent of overall revenue in the next few years, compared with 20 per cent in 2014.

The company’s net income rose to $929 million, or $2.94 per share, in the second quarter ended June 28th, from $889 million, or $2.76 per share, a year earlier.

Net sales increased 3 per cent to $11.64 billion.

Analysts on average expected earnings of $2.66 per share, on revenue of $10.99 billion, according to Thomson Reuters I/B/E/S.

Lockheed’s shares were up 1.4 per cent at $204 in premarket trading. Up to Friday’s close of $201.18, the stock had risen 24 per cent in the past 12 months. – Reuters)