Raytheon Posts Better-than-Expected Profit
January 28 2016 - 9:22AM
Dow Jones News
By Doug Cameron
Raytheon Co. has boosted output of precision weapons and has
capacity to produce more as the U.S. and its allies tackle a
shortage of munitions for campaigns in the Middle East.
The maker of Paveway laser guided bombs and Tomahawk missiles
has joined other defense companies including Boeing Co. and
Lockheed Martin Corp. in expanding production for the Pentagon,
while countries including Iraq are seeking thousands of bombs and
missiles.
"We were flexing through 2015 and we still have some [more]
capacity, internally and in the supply base," Raytheon Chief
Financial Officer Toby O'Brien said in an interview.
Raytheon is the most export-driven of the major U.S. companies,
with overseas sales reaching a record 31% last year, while domestic
revenue rose for the first time since 2009.
Mr. O'Brien said there has been no impact on demand from
oil-dependant nations in the wake of falling energy prices, echoing
comments this week from executives at other contractors.
His comments came as Raytheon reported forecast-beating fourth
quarter profit, and full-year sales rose to $23.2 billion,
reversing a string of sequential declines a year earlier than
management originally expected.
The company reported net profit of $567 million for the quarter
compared with $586 million a year earlier, with per-share earnings
climbing a penny to $1.89 as sales rose 3% to $6.33 billion.
Raytheon forecast revenue to climb to $24 billion to $24.5
billion in 2016--compared with $23.2 billion last year--with
per-share earnings in a range of $6.80 to $7.00.
Bookings rose $7.9 billion in the quarter to close the year at
$25.2 billion, with 34% derived from overseas.
The company is also betting it can leverage the cybersecurity
skills it honed for the U.S. military and intelligence agencies to
sell to banks and retailers, investing almost $1.7 billion last
year to establish a stand-alone business--recently rebranded as
Forcepoint--in an area where its defense peers have struggled to
make money.
Write to Doug Cameron at doug.cameron@wsj.com
(END) Dow Jones Newswires
January 28, 2016 10:07 ET (15:07 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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