Latest news with #Sikorsky
Yahoo
15 hours ago
- Business
- Yahoo
Lockheed Martin Corp (LMT) Q2 2025 Earnings Call Highlights: Navigating Challenges with ...
Revenue: $18.2 billion for the second quarter, comparable year-over-year and up sequentially from the first quarter. Sales Growth: Excluding charges, sales increased in the mid-single-digit range. Segment Operating Profit: $570 million, impacted by $1.6 billion in charges related to Skunk Works and Sikorsky. Net Losses: $1.8 billion in total charges across several legacy programs. Earnings Per Share (EPS): $1.46, reduced by $5.83 due to program losses and tax items. Free Cash Flow: Usage of $150 million in the second quarter. Shareholder Returns: $1.3 billion returned through dividends and share repurchases. F-35 Deliveries: 50 aircraft delivered in the quarter, with a total of 97 so far this year. Guidance: 2025 sales guidance reaffirmed at $73.75 billion to $74.75 billion. Backlog: $167 billion, with significant awards expected in the second half of the year. Warning! GuruFocus has detected 2 Warning Signs with LMT. Release Date: July 22, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Positive Points Lockheed Martin Corp (NYSE:LMT) reported $18 billion in sales for the second quarter, demonstrating strong revenue generation. The company invested $800 million in infrastructure and innovation, indicating a commitment to future growth. Lockheed Martin Corp (NYSE:LMT) returned $1.3 billion to shareholders, showcasing a strong commitment to shareholder value. The F-35 program remains on track with 97 deliveries so far this year, highlighting operational efficiency. Lockheed Martin Corp (NYSE:LMT) demonstrated the effectiveness of its systems in recent combat operations, reinforcing its role in national security. Negative Points Lockheed Martin Corp (NYSE:LMT) recognized $1.8 billion in losses across several legacy programs, impacting financial performance. The company faced significant charges related to the Aeronautics Classified Program and other legacy programs, indicating ongoing challenges. US government sanctions affected the Turkish Utility Helicopter Program, resulting in a $95 million loss. The Canadian Maritime Helicopter Program incurred a $570 million loss due to revised cost and sales estimates. The IRS asserts that Lockheed Martin Corp (NYSE:LMT) owes $4.6 billion in additional income tax, creating potential financial uncertainty. Q & A Highlights Q: Why should investors feel comfortable that Lockheed Martin has derisked the problem programs, particularly the Aero Classified one? What changes have been made? A: James Taiclet, CEO, explained that with Evan Scott's succession as CFO, a new program review team was formed with wider expertise and higher-level management scrutiny. This team reassessed cost trends and reevaluated program assumptions, leading to additional charges. The programs will continue to be monitored with robust oversight, and there is a policy in place to avoid must-win programs, ensuring no outsized future risks. Q: Why did it take a billion dollars of charges to change the way you're reviewing the Aero Classified program? How does the $1.8 billion in charges affect cash flow? A: James Taiclet noted that the charges were due to new discoveries of cost risks and anomalies in the development phase. Evan Scott added that $500 million of cash usage is expected this year, stepping down to $400 million next year, with a line of sight to when it turns positive. Q: Can you explain the reduction in the F-35 units in the administration's FY26 request and how easy it is to swap out relinquished DoD slots with export customers? A: James Taiclet stated that the House Appropriations Committee increased the number of F-35s from 47 to 69, and the Senate marked it up to 57. Historically, appropriations committees have the final say, and there is hope for greater demand by the end of the budget process. Evan Scott added that the backlog remains strong, allowing flexibility in production planning. Q: What is the $4.6 billion tax liability related to, and how will it impact free cash flow? A: Evan Scott explained that the IRS's position on a tax accounting method change is being contested, with Lockheed Martin standing by its approach. A $100 million P&L charge was taken for interest. For 2026, a $1 billion pension contribution is assumed, with various factors impacting cash flow, including reach-forward charges and tax benefits. Q: Can you discuss the F-35's role in modern warfare and its priority for the DoD today? A: James Taiclet emphasized the F-35's critical role in modern warfare, citing its orchestration capabilities and combat-proven status. Despite budget cuts, the F-35 remains essential, and Lockheed Martin is focused on bridging capabilities to the next generation while maintaining strong international demand. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Reuters
a day ago
- Business
- Reuters
Lockheed profit dives 80% on $1.6 billion charge, shares tumble
July 22 (Reuters) - Lockheed Martin (LMT.N), opens new tab reported on Tuesday that its second-quarter profit plunged by about 80%, after the U.S. defense group recorded a pretax loss of $1.6 billion, mainly linked to a classified program within its Aeronautics segment, sending its shares down more than 8%. The company also trimmed its 2025 profit outlook by $1.5 billion or 18% and said it now targets $6.65 billion in operating profit for the year. This new guidance, revised down since the company's last estimate in April, did not include potential impacts from tariffs which have affected other defense companies with international customers. Lockheed's tariff risk is relatively low, as its supply chains and labor are largely domestic, said Brian Mulberry, portfolio manager at Zacks Investment Management. The company's hefty charge stemmed from difficulties with a classified program in its Aeronautics business and international helicopter programs in its Sikorsky unit. Defense contractors are grappling with mounting cost pressures as inflation and supply chain disruptions drive up expenses on long-term programs priced years ago. Many of these contracts — often fixed-price — were negotiated before the post-pandemic surge in labor, material, and component costs, forcing contractors such as Lockheed to absorb overruns. Apart from the $950 million charge on the classified program, Lockheed took a $570 million hit on its work for the Canadian government relating to the procurement of its CH-148 Cyclone maritime helicopters. The Turkish Utility Helicopter Program (TUHP) saw a $95 million loss as well. This charge was due to a restructuring caused by U.S. government sanctions on Turkish entities and persons involved in the program, Taiclet said in a call with analysts. Lockheed is also engaged in a tussle with U.S. tax authorities who assert the company owes an additional $4.6 billion tax bill, executives said, adding they were pursuing a remedy that could include litigation. Additionally, the company provided an update on progress with upgrades on its F-35 jets, saying it had completed hardware integration and released new software on the fleet. Earlier this month, the Pentagon's program office confirmed the final delivery of 72 jets held in long-term storage in 2024. Lockheed's net income in the quarter fell to $342 million, or $1.46 per share from $1.64 billion, or $6.85 per share, a year earlier. Excluding these charges, the group posted an adjusted profit of $7.29 per share, beating an average estimate of $6.44 per share according to data compiled by LSEG. Lockheed missed Wall Street estimates for second-quarter revenue, which came in at $18.16 billion, compared with an average expectation of $18.57 billion.
CTV News
a day ago
- Business
- CTV News
Lockheed Martin second-quarter profit plummets on US$1.6 billion charge
An image of a CF-35, the Canadian variant of the F-35 fighter aircraft, is seen at the Lockheed Martin booth at the Canadian Association of Defence and Security Industries annual defence industry trade show CANSEC, in Ottawa. THE CANADIAN PRESS/Justin Tang Lockheed Martin reported on Tuesday that its second-quarter profit plunged by about 80 per cent, after the U.S. defense group recorded a pretax loss of US$1.6 billion, mainly linked to a classified program within its Aeronautics segment. The company's shares fell 7.9 per cent in premarket trading as the company also trimmed its 2025 profit estimate by $1.5 billion or 18 per cent and said it now targets $6.65 billion in operating profit for the year. This new guidance, revised down since the company's last estimate in April, did not include potential impacts from tariffs which have impacted other defense companies with international customers. 'Overall, the company's foundation remains solid and resilient,' Chief Executive Jim Taiclet said in the company's earnings statement. Net income fell to $342 million, or $1.46 per share, compared with $1.64 billion, or $6.85 per share, a year earlier. Lockheed said the charge stemmed from difficulties with a classified program in its Aeronautics business and several international helicopter programs in its Sikorsky unit. Defense contractors are grappling with mounting cost pressures as inflation and supply chain disruptions drive up expenses on long-term programs priced years ago. Many of these contracts — often fixed-price — were negotiated before the post-pandemic surge in labor, material, and component costs, forcing contractors such as Lockheed to absorb overruns. Apart from the $950 million charge on the classified program, Lockheed took a $570 million hit on its work for the Canadian government relating to the procurement of its CH-148 Cyclone maritime helicopters. 'The company is in ongoing discussions with the customer regarding a potential restructure to certain contractual terms and conditions and to expand the scope of work that would be beneficial to both parties,' Lockheed said of the program. Excluding these charges, however, the group posted an adjusted profit of $7.29 per share, beating an average estimate of $6.44 per share according to data compiled by LSEG. Lockheed missed Wall Street estimates for second-quarter revenue, which came in at $18.16 billion, compared with an average expectation of $18.57 billion. (Reporting by Utkarsh Shetti in Bengaluru and Mike Stone in Washington; Editing by Tasim Zahid and David Holmes)
Reuters
a day ago
- Business
- Reuters
Lockheed Martin second-quarter profit plummets on $1.6 billion charge
July 22 (Reuters) - Lockheed Martin reported on Tuesday that its second-quarter profit plunged by about 80%, after the U.S. defense giant recorded pre-tax losses of $1.6 billion, mainly linked to a classified program within its Aeronautics segment. The company's shares fell 8% in premarket trading. Its net income dropped to $342 million, or $1.46 per share, compared with $1.64 billion, or $6.85 per share, a year earlier Lockheed said the charge stemmed from difficulties with a classified program in its Aeronautics business and to certain international helicopter programs in its Sikorsky unit.
CBS News
2 days ago
- Climate
- CBS News
Colorado's newest firefighting helicopter shelved for several weeks during wildfire season
In a case of bad timing, a helicopter purchased by the state for the specific purpose of fighting wildfires has been taken out of service in the middle of the summer fire season. The "state of the art" Firehawk is undergoing required regular maintenance, according to the Colorado Division of Fire Prevention and Control. An agency spokesperson told CBS Colorado the craft was taken out of service July 13 for thorough, mandated inspections. Several wildfires were ignited by lightning strikes on Colorado Western Slope the same day the Firehawk was taken out of service. Four of the larger fires - the South Rim, Turner Gulch, Sowbelly and Deer Creek incidents - are still burning. "We currently have 5 mechanics working on to get it back up and operational ASAP," CDFPC's Tracy LeClair stated. The normal duration of such inspections is several weeks, LeClair added. "We are hoping for sooner than that," LeClair stated. "They understand the urgency of getting us back up as soon as possible, without compromising safety." The Firehawk is a version of the military's UH-70 Black Hawk built by Sikorsky. The Si70i's wildfire conversion features a 1,000-gallon belly tank, extended landing gear, and a retractable snorkel that can refill the tank in less than a minute. Colorado ordered the aircraft following the 2020 wildfire season, one of the state's worst on record. The fires that year included the Cameron Peak, Pine Gulch, Grizzly Creek, Williams Ford, Middle Fork, East Troublesome and Calwood blazes. Three of those - Cameron Peak, Pine Gulch and East Troublesome - were the largest wildfires (in acreage) in state history. Colorado's legislature approved almost $31 million in 2021 for the purchase of the Firehawk and the leasing of other helicopters until its arrival. State officials celebrated the purchase in a press conference. "Not only will the Firehawk be an additional resource for aggressive and early initial attack," said Mike Morgan, Director of Colorado Division of Fire Prevention and Control, at that press conference, "but it can also be used on longer duration wildfires." The state's Firehawk recently reached 480 hours of flight time, necessitating the scheduled maintenance, CDFPC's Tracy LeClair explained. "The military has the same scheduled maintenance and is down the same amount of time to perform these Safety Inspections as required by the manufacturer," LeClair stated. "The critical nature of performing quality maintenance on an aircraft is not like an ordinary vehicle. It cannot be postponed, and one mistake, malfunction, or component failure can be catastrophic and fatal, unlike rolling to the edge of a road and waiting for a tow truck when your car breaks down." The maintenance includes some disassembly of the Firehawk to inspect the airframe, and the flight control systems and components running throughout it. Both engines will be removed during the process. LeClair confirmed a second Firehawk is on order. "We were planning to perform this inspection in the winter months, but we had no choice on this 1st helicopter," she said. "Once we have our second helicopter, we can stagger the maintenance to ensure one aircraft is available at all times. We don't have a solid delivery date for the 2nd one yet, but it is tentatively scheduled for delivery and acceptance late summer/early fall."
