Lockheed Martin (LMT) Tops Q3 EPS by 4c; Boosts FY14 EPS Outlook

Lockheed Martin (NYSE: LMT) reported Q3 EPS of $2.76, $0.04 better than the analyst estimate of $2.72. Revenue for the quarter came in at $11.11 billion versus the consensus estimate of $11.28 billion.

Lockheed Martin sees FY2014 EPS of about $11.15, versus prior guidance of $10.85 - $11.15 and the consensus of $11.14. Sees sales of about $45 billion, from prior guidance of $44 to $45 billion. The Street is at $44.8 billion.

2015 Financial Trends

The Corporation expects 2015 net sales will decline at a low single digit rate from 2014 levels and that total business segment operating margin will be in the 11.5 percent to 12.0 percent range. The Corporation's preliminary outlook for 2015 assumes the U.S. Government continues to support and fund its key programs, consistent with the continuing resolution funding measure through Dec. 11, 2014, and the U.S. Government approves budget legislation for government fiscal year (GFY) 2015 consistent with the President's proposed budget. Changes in circumstances may require the Corporation to revise its assumptions, which could materially change its current estimate of 2015 net sales and operating margin.

The Corporation expects 2015 FAS/CAS pension income of approximately $650 million assuming a 4.25 percent discount rate at the end of 2014, the same rate used for the re-measurement of its defined benefit pension obligations in June 2014, an 8.00 percent actual return on plan assets in 2014, and incremental pension contributions of $1.0 billion anticipated in the fourth quarter of 2014, among other assumptions. The Corporation does not expect to make contributions to its qualified defined benefit pension plans in 2015 through 2017. A change of plus or minus 25 basis points to the assumed discount rate, with all other assumptions held constant, would result in an incremental increase or decrease of approximately $120 million to the estimated 2015 FAS/CAS pension income. The Corporation will finalize the postretirement benefit plan assumptions and determine the 2014 actual return on plan assets on Dec. 31, 2014.

For earnings history and earnings-related data on Lockheed Martin (LMT) click here.

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