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General Dynamics (GD) Tops on Q1 Earnings, Revenues Lag

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General Dynamics Corporation (GD - Free Report) reported first-quarter 2018 earnings from continuing operations of $2.65 per share, beating the Zacks Consensus Estimate of $2.47 by 7.3%. Reported earnings were up 6.9% from $2.48 recorded in the year-ago quarter.

Total Revenues

In the quarter, General Dynamics’ total revenues of $7,535 million missed the Zacks Consensus Estimate of $7,543 million by 0.1%.

However, reported revenues were up 1.3% from $7,441 million in the year-ago quarter. The year-over-year increase in total revenues was primarily due to increased contribution from all reportable segments except Aerospace.

Price, Consensus and EPS Surprise
 

Price, Consensus and EPS Surprise | Quote

Segment Performance

Aerospace: The segment generated revenues of $1,825 million, down 12.0% year over year. Operating earnings of $346 million were down 21.2% from the prior-year quarter’s figure of $439 million.

Combat Systems: The segment’s revenues rose 11.9% to $1,440 million. Operating earnings were up 9.3% to $224 million in the quarter.

Information Systems and Technology: The segment generated revenues of $2,236 million, up 4.2% from a year ago. Operating income rose 4.7% from the year-ago quarter to $247 million.

Marine Systems: The segment’s revenues of $2,034 million were up 5.2% from the year-ago figure of $1,934 million. Operating income improved 14.3% from the prior-year quarter to $184 million.

Operational Highlights

The company recorded a total backlog of $62.1 billion. Including the value in unfunded indefinite delivery, indefinite quantity contracts and unexercised options, at the end of first-quarter 2018 were $87.6 billion.

Operating costs and expenses in the reported quarter were $6,527 million, up 2.1% from the year-ago quarter.

Operating income at the end of the quarter was $1,008 million compared with $1,046 million in the year-ago quarter.

Financial Condition

As of Apr 1, 2018, General Dynamics’ cash and cash equivalents were $4,332 million, compared with $2,983 million as of Dec 31, 2017.

Long-term debt as of Apr 1, 2018 was $3,981 million, up from the 2017-end level of $3,980 million.

The company’s cash flow (used)/provided from operating activities was ($496) million in the first quarter of 2018, compared with $533 million in the first quarter of 2017.

Zacks Rank

General Dynamics carries a Zacks Rank #3 (Hold). You can see  the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Peer Releases

Textron Inc.’s (TXT - Free Report) first-quarter 2018 earnings from continuing operations of 72 cents per share beat the Zacks Consensus Estimate of 46 cents by 56.5%.

Lockheed Martin Corp. (LMT - Free Report) reported first-quarter 2018 earnings from continuing operations of $4.02 per share, surpassing the Zacks Consensus Estimate of $3.35 by 20%.

The Boeing Company (BA - Free Report) reported first-quarter 2018 earnings from continuing operations of $3.64 per share, surpassing the Zacks Consensus Estimate of $2.59 by 40.5%.

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