Lockheed Martin projects slower growth for 2010-11
21 Oct 2009
New York: World's largest defence contractor, Lockheed Martin Corp, said it faced a decline in profits next year with the US Department of Defence cancelling some large acquisitions. Lockheed and other defence contractors face pressure with their major weapon programmes as the US defence budget is not expected to grow much from the $668 billion that the Pentagon has proposed for 2010.
According to chief financial officer Bruce Tanner cancelled orders for the new VH-71 presidential helicopter and the combat search-and-rescue helicopter have affected growth. Also impacting revenue growth was the Pentagon's termination of the Transformational Communications Satellite programme and the Multiple-Kill Vehicle.
Revenue for 2010 was expected to be $46.3 billion to $47.3 billion, the Bethesda, Maryland-based company said.
''We very much view 2010 as the start of a transition period,'' Tanner said in an interview.
The company's F-35 Joint Strike Fighter, Tanner said, will grow ''to be about 45 percent of sales of aeronautics in 2010 and although it's growing leaps and bounds it's bringing with it lower margins because it's still in a development phase,'' he said.
Tanner said he expected 2010, and most of 2011, to reflect slower growth before the ramp up in the F-35 Joint-Strike Fighter programme helped boost sales 5 per cent annually.