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L3Harris (LHX) Beats on Q3 Earnings, Ups '23 Sales View
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L3Harris Technologies, Inc. (LHX - Free Report) reported third-quarter 2023 adjusted earnings (from continuing operations) of $3.19 per share, which beat the Zacks Consensus Estimate of $3.06 by 4.2%. However, the bottom line decreased 2.1% from the year-ago quarter’s reported figure.
Excluding one-time items, the company reported GAAP earnings of $2.02 per share against a GAAP loss of $1.56 in the prior-year period.
Total Revenues
L3Harris’ revenues totaled $4,915 million, which beat the Zacks Consensus Estimate of $4,819 million by 2%. The figure also rose 15.8% from the year-ago quarter’s figure of $4,246 million.
L3Harris Technologies Inc Price, Consensus and EPS Surprise
Integrated Mission Systems: The segment recorded net revenues of $1,568 million, down 3.8% year over year. This was on account of unfavorable timing of aircraft missionizations, including lower subcontractor-driven revenue and international volume.
Operating income from this segment totaled $210 million, up 128.3% from the prior-year quarter’s level. The adjusted operating margin was 12.5%.
Space and Airborne Systems: Net revenues from the segment were $1,686 million, up 5.8% year over year. This upside was largely driven by the ramp-up in new programs from Space and Intelligence &Cyber businesses on account of continued high demand and record backlog.
Operating income from this segment improved to $187 million from an operating loss of $143 million in the year-ago quarter. The operating margin was 11.9%.
Communication Systems: Net revenues from this segment increased 17.5% to $1,255 million due to higher domestic volumes from Tactical Communication, driven by increased demand and improved electronic component availability. Benefits from the acquisition of Tactical Data Links also contributed to this unit’s revenues.
Operating income improved to $282 million from an operating loss of $97 million reported in the year-ago quarter. The operating margin was 22.5%.
Aerojet Rocketdyne: This segment reported revenues of $455 million and an operating income of $56 million.
Financial Position
As of Sep 29, 2023, L3Harris had $499 million in cash and cash equivalents compared with $880 million as of Dec 31, 2022.
The long-term debt as of Sep 29, 2023, was $11,140 million compared with $6,225 million as of Dec 31, 2022.
The net cash inflow from operating activities amounted to $1,307 million during the nine months ended Sep 29, 2023, compared with $1,376 million in the year-ago period.
2023 View
L3Harris updated its 2023 guidance to incorporate the acquisition of Aerojet Rocketdyne. It now expects revenues in the range of $19.20-$19.40 billion, up from the prior guidance of $18.00-$18.30 billion. The Zacks Consensus Estimate for revenues is pegged at $19.06 billion, lower than the company’s guided range.
LHX now projects 2023 earnings in the range of $12.25-$12.45 per share, narrower than the prior guidance of $12.15-$12.55. The Zacks Consensus Estimate for the same is pegged at $12.30 per share, lower than the midpoint of the guided range.
LHX continues to expect more than $2 billion in adjusted free cash flow.
Lockheed Martin Corporation (LMT - Free Report) reported third-quarter 2023 adjusted earnings of $6.77 per share, which beat the Zacks Consensus Estimate of $6.66 by 1.7%. The bottom line, however, deteriorated 1.5% from the year-ago quarter's recorded figure.
Net sales were $16.88 billion, which beat the Zacks Consensus Estimate of $16.66 billion by 1.3%. The top line also rose 1.8% from $16.58 billion reported in the year-ago quarter.
RTX Corporation’s (RTX - Free Report) third-quarter 2023 adjusted earnings per share of $1.25 beat the Zacks Consensus Estimate of $1.19 by 5%. The bottom line also improved 3.3% from the year-ago quarter’s level of $1.21.
RTX’s third-quarter adjusted sales of $18,952 million beat the Zacks Consensus Estimate of $18,709 million by 1.3%.
Hexcel Corporation (HXL - Free Report) reported third-quarter 2023 adjusted earnings of 38 cents per share, which missed the Zacks Consensus Estimate of 42 cents by 9.5%. However, the bottom line improved 15.2% from the year-ago quarter’s level of 33 cents.
Net sales were $420 million, which missed the Zacks Consensus Estimate of $431 million by 2.6%. However, the top line improved 15% from the year-ago quarter’s level of $365 million.
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L3Harris (LHX) Beats on Q3 Earnings, Ups '23 Sales View
L3Harris Technologies, Inc. (LHX - Free Report) reported third-quarter 2023 adjusted earnings (from continuing operations) of $3.19 per share, which beat the Zacks Consensus Estimate of $3.06 by 4.2%. However, the bottom line decreased 2.1% from the year-ago quarter’s reported figure.
Excluding one-time items, the company reported GAAP earnings of $2.02 per share against a GAAP loss of $1.56 in the prior-year period.
Total Revenues
L3Harris’ revenues totaled $4,915 million, which beat the Zacks Consensus Estimate of $4,819 million by 2%. The figure also rose 15.8% from the year-ago quarter’s figure of $4,246 million.
L3Harris Technologies Inc Price, Consensus and EPS Surprise
L3Harris Technologies Inc price-consensus-eps-surprise-chart | L3Harris Technologies Inc Quote
Segmental Performance
Integrated Mission Systems: The segment recorded net revenues of $1,568 million, down 3.8% year over year. This was on account of unfavorable timing of aircraft missionizations, including lower subcontractor-driven revenue and international volume.
Operating income from this segment totaled $210 million, up 128.3% from the prior-year quarter’s level. The adjusted operating margin was 12.5%.
Space and Airborne Systems: Net revenues from the segment were $1,686 million, up 5.8% year over year. This upside was largely driven by the ramp-up in new programs from Space and Intelligence &Cyber businesses on account of continued high demand and record backlog.
Operating income from this segment improved to $187 million from an operating loss of $143 million in the year-ago quarter. The operating margin was 11.9%.
Communication Systems: Net revenues from this segment increased 17.5% to $1,255 million due to higher domestic volumes from Tactical Communication, driven by increased demand and improved electronic component availability. Benefits from the acquisition of Tactical Data Links also contributed to this unit’s revenues.
Operating income improved to $282 million from an operating loss of $97 million reported in the year-ago quarter. The operating margin was 22.5%.
Aerojet Rocketdyne: This segment reported revenues of $455 million and an operating income of $56 million.
Financial Position
As of Sep 29, 2023, L3Harris had $499 million in cash and cash equivalents compared with $880 million as of Dec 31, 2022.
The long-term debt as of Sep 29, 2023, was $11,140 million compared with $6,225 million as of Dec 31, 2022.
The net cash inflow from operating activities amounted to $1,307 million during the nine months ended Sep 29, 2023, compared with $1,376 million in the year-ago period.
2023 View
L3Harris updated its 2023 guidance to incorporate the acquisition of Aerojet Rocketdyne. It now expects revenues in the range of $19.20-$19.40 billion, up from the prior guidance of $18.00-$18.30 billion. The Zacks Consensus Estimate for revenues is pegged at $19.06 billion, lower than the company’s guided range.
LHX now projects 2023 earnings in the range of $12.25-$12.45 per share, narrower than the prior guidance of $12.15-$12.55. The Zacks Consensus Estimate for the same is pegged at $12.30 per share, lower than the midpoint of the guided range.
LHX continues to expect more than $2 billion in adjusted free cash flow.
Zacks Rank
L3Harris currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Defense Releases
Lockheed Martin Corporation (LMT - Free Report) reported third-quarter 2023 adjusted earnings of $6.77 per share, which beat the Zacks Consensus Estimate of $6.66 by 1.7%. The bottom line, however, deteriorated 1.5% from the year-ago quarter's recorded figure.
Net sales were $16.88 billion, which beat the Zacks Consensus Estimate of $16.66 billion by 1.3%. The top line also rose 1.8% from $16.58 billion reported in the year-ago quarter.
RTX Corporation’s (RTX - Free Report) third-quarter 2023 adjusted earnings per share of $1.25 beat the Zacks Consensus Estimate of $1.19 by 5%. The bottom line also improved 3.3% from the year-ago quarter’s level of $1.21.
RTX’s third-quarter adjusted sales of $18,952 million beat the Zacks Consensus Estimate of $18,709 million by 1.3%.
Hexcel Corporation (HXL - Free Report) reported third-quarter 2023 adjusted earnings of 38 cents per share, which missed the Zacks Consensus Estimate of 42 cents by 9.5%. However, the bottom line improved 15.2% from the year-ago quarter’s level of 33 cents.
Net sales were $420 million, which missed the Zacks Consensus Estimate of $431 million by 2.6%. However, the top line improved 15% from the year-ago quarter’s level of $365 million.