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GENERAL DYNAMICS ANNOUNCES THIRD QUARTER 1992 RESULTS: EARNINGS FROM CONTINUING OPERATIONS INCREASE 55 PERCENT

 GENERAL DYNAMICS ANNOUNCES THIRD QUARTER 1992 RESULTS:
 EARNINGS FROM CONTINUING OPERATIONS INCREASE 55 PERCENT
 FALLS CHURCH, Va., Oct. 15 /PRNewswire/ -- General Dynamics Corporation (NYSE: GD) today reported 1992 third quarter earnings from continuing operations of $62 million on sales of $1.7 billion, an increase of 55 percent from 1991 third quarter earnings from continuing operations of $40 million on sales of $1.4 billion. Fully diluted earnings per share from continuing operations were $1.95 in the 1992 third quarter, compared with 1991 results of 94 cents per share. Through a tender offer, the company repurchased 13.2 million shares of its common stock in July 1992, reducing the number of shares outstanding by approximately 30 percent.
 As previously reported, in order to focus on strengthening its core businesses, the company expects to sell its non-core businesses in an orderly and prudent manner. Earnings from non-core businesses in the third quarter of 1992 were $58 million, including gains of $7 million recognized upon the completion of the sale of the company's Missile Systems business and $16 million reflecting the favorable resolution of litigation during the quarter. Earnings from non-core businesses in the third quarter of 1991 were $31 million. Total net earnings, the combination of earnings from both continuing and non-core businesses, were $120 million in the 1992 third quarter, versus $71 million in the year-ago period. Fully diluted net earnings per share were $3.77 in the third quarter of 1992 and $1.66 in the year-ago period.
 For the first nine months of 1992, earnings from continuing operations were $184 million on sales of $4.8 billion. In the same period of 1991, earnings from continuing operations were $117 million, excluding a $140 million gain from a tax adjustment. Including the tax adjustment, 1991 nine-months earnings from continuing operations were $257 million. Non-core earnings of $457 million for the first nine months of 1992 included aggregate gains of $381 million both from sales of non-core businesses and favorable resolution of litigation during the period, compared with non-core earnings of $82 million for the first nine months of 1991. Total net earnings for the first nine months of 1992 were $641 million versus $339 million for the same period in 1991.
 Funded backlog for continuing operations at the end of the 1992 third quarter was $12.9 billion, while total backlog (funded and unfunded) for continuing operations was $19.1 billion. Comparable amounts at the same time last year were $13.2 billion and $19.5 billion, respectively.
 William A. Anders, chairman and chief executive officer, said: "We have empowered the managements of the core businesses to develop opportunities to strengthen their franchises and further enhance program efficiency. These efforts continued to generate positive results in the third quarter, benefiting our customers, employees and shareholders.
 "In Tactical Military Aircraft, Congress has responded positively to the U.S. Air Force's desire to continue production of the F-16 in 1993 and 1994. With notification of the proposed sales of 150 F-16s to Taiwan and an additional 40 to Greece, recent U.S.-European agreement on an F-16 Midlife Update program, and our ongoing efforts to further enhance quality and efficiency on our aircraft production lines, the F-16 will continue as the world's most cost effective advanced tactical military aircraft for the foreseeable future.
 "In Armored Vehicles, Congress has continued its strong support for the U.S. Army's program to upgrade older M1 Abrams-class main battle tanks to the state-of-the-art M1A2 version. We believe this support contributed to Saudi Arabia's recent reaffirmation of its initial order for 465 M1A2s, as well as the recent announcement of Kuwait's selection of the M1A2 for an initial procurement of 236 main battle tanks. These events position us well for on-going competitions for 390 tanks in the United Arab Emirates and 200 in Sweden. Further, this business' efforts to continue to control costs and increase efficiency for the customer were successful during the quarter, as well.
 "In Nuclear Submarines, aggressive efforts to streamline production and improve efficiency also proved successful during the quarter, generating positive earnings on 688-Class nuclear submarine production for the first time since 1987. We are optimistic that Electric Boat's focus on program efficiency will prove increasingly successful, underscoring its position as the nation's premier, cost- effective designer and producer of nuclear submarines.
 "In Space Launch Systems, a launch failure during the quarter interrupted the momentum this business had established through the first half. As a result, launches whose schedules had been moved forward into this year were returned to their original 1993 dates. A full-scale investigation of the causes of the failure is underway, comprising both an internal team and a fully independent investigative effort which includes customer participants. We hope to have the investigation complete by year-end, including a full evaluation of the launch failure's financial impact on the business.
 "Our emphasis on financial strength continues. During the first nine months of this year, we have retired over $370 million in debt and repurchased $957 million in company stock. We closed the third quarter of 1992 with approximately $500 million in cash and marketable securities, amply meeting our liquidity needs. In addition, during the quarter we received 21.5 million shares of General Motors Class H common stock (NYSE: GMH) in payment for the Missile Systems business, and General Motors has initiated preparations for the sale of these GMH shares in a secondary offering. General Dynamics will receive at least $450 million in cash for these shares. Finally, our program to monetize non-core businesses moved forward during the quarter as definitive agreements were signed for the sale of electronics and sealift operations. We anticipate completion of these sales by year-end."
 GENERAL DYNAMICS
 Consolidated Statement of Earnings (Unaudited)
 (Dollars in millions, except per share amounts)
 Third Quarter Nine Months
 1992 1991 1992 1991
 Net Sales $ 1,661 $ 1,429 $ 4,842 $ 4,525
 Operating Costs
 and Expenses 1,566 1,363 4,570 4,313
 Operating Earnings 95 66 272 212
 Interest, Net (2) (8) 3 (32)
 Other Expense, Net (2) (5) (3) (16)
 Earnings from
 Continuing Operations
 Before Income Taxes 91 53 272 164
 Provision (Credit)
 for Income Taxes 29 13 88 (93)
 Earnings from
 Continuing Operations 62 40 184 257
 Non-Core Businesses:
 Earnings from
 Operations 51 31 92 82
 Gain on Disposal 7 - 365 -
 Net Earnings $ 120 $ 71 $ 641 $ 339
 Fully Diluted Earnings
 Per Share:
 Continuing
 Operations $ 1.95 $ 0.94 $ 4.62 $ 6.03
 Non-Core Businesses:
 Earnings from
 Operations 1.60 0.72 2.31 1.92
 Gain on Disposal 0.22 - 9.17 -
 Net Earnings $ 3.77 $ 1.66 $ 16.10 $ 7.95
 GENERAL DYNAMICS
 Net Sales and Operating Earnings by Segment (Unaudited)
 (Dollars in millions)
 Third Quarter Nine Months
 1992 1991 1992 1991
 Net Sales:
 Tactical Military
 Aircraft $ 804 $ 650 $ 2,285 $ 2,124
 Nuclear Submarines 419 453 1,283 1,330
 Armored Vehicles 275 263 855 850
 Space Launch
 Systems 163 63 419 221
 Total $ 1,661 $ 1,429 $ 4,842 $ 4,525
 Operating Earnings
 (Loss):
 Tactical Military
 Aircraft $ 52 $ 39 $ 149 $ 123
 Nuclear Submarines 26 24 69 63
 Armored Vehicles 28 26 82 75
 Space Launch Systems (11) (23) (28) (49)
 Total $ 95 $ 66 $ 272 $ 212
 -0- 10/15/92
 /CONTACT: Alvin A. Spivak of General Dynamics, 703-876-3190/
 (GD GMH) CO: General Dynamics Corporation ST: Virginia IN: ARO SU: ERN


MH -- DC004 -- 0283 10/15/92 09:50 EDT
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