Raytheon Co., the world’s largest missile maker, said fourth-quarter profit rose 9.4 percent aided by improved performance at its missile and space units. The company’s forecast for this year fell short of analyst estimates.
Net income from continuing operations increased to $546 million, or $1.58 a share, compared with $499 million, or $1.37 a share, a year earlier, Raytheon said today in a statement. Excluding certain items, profit was $1.74 a share, exceeding the $1.34-a-share average estimate of 21 analysts surveyed by Bloomberg. Sales declined 6.4 percent to $6.44 billion.
Full-year profit from continuing operations for 2012 will fall to $4.90 to $5.05 a share, from $5.28 in 2011, on sales of $24.5 billion to $25 billion, the company forecast. Analysts estimated a profit of $5.26 a share. On an adjusted basis, Raytheon forecast profit of $5.45 to 5.60 a share.
Chief Executive Officer Bill Swanson has said he is focusing on wringing costs out of programs to improve profitability even as the U.S. Defense Department seeks tougher contract terms such as fixed-price work from suppliers. “We know as a company, if we weren’t taking costs out, somebody would be replacing us,” Swanson told investors in November.
Raytheon, based in Waltham, Massachusetts, rose 2 cents to $49.71 yesterday in New York trading. The stock dropped 5 percent in the 12 months before today.
Fourth-quarter revenue at the Integrated Defense Systems unit, Raytheon’s largest, declined 12 percent to $1.29 billion, because of lower sales to the U.S. Navy and international orders for the Patriot anti-missile system, the company said. Unit profit fell less than 1 percent to $236 million.
Missile Systems sales fell 5.3 percent to $1.48 billion because of weak demand for the Standard Missile and Rolling Airframe Missile. Better performance and a favorable contract settlement led to a 23 percent increase in profit to $209 million, the company said. No details of the contract were provided.
Space & Airborne Systems unit revenue increased 3.1 percent to $1.34 billion, and profit rose 31 percent to $214 million, the company said. The improved sales resulted from the acquisition of Applied Signal Technology in the first quarter of 2011, Raytheon said.
Sales at the Intelligence and Information Systems unit declined 8.2 percent to $753 million, and profit rose 10 percent to $74 million. Network Centric Systems, which makes radar and surveillance systems, saw sales and profits decline to $1.14 billion and $175 million respectively.
Revenue at the Technical Services unit, which provides training programs, fell 8 percent to $886 million, and profit rose 2 percent to $84 million.
Full-year sales for 2011 declined 1.3 percent to $24.9 billion compared with 2010, and profit from continuing operations increased 3.5 percent to $1.87 billion.