L-3 Communications (LLL) Tops Q2 EPS by 52c, Beats on Revenues; Raises FY17 EPS & Revenue Guidance

L-3 Communications (NYSE: LLL) reported Q2 EPS of $2.54, $0.52 better than the analyst estimate of $2.02. Revenue for the quarter came in at $2.73 billion versus the consensus estimate of $2.64 billion.

GUIDANCE:

L-3 Communications sees FY2017 EPS of $8.65-$8.85, versus the consensus of $8.76. L-3 Communications sees FY2017 revenue of $10.8-11 billion, versus the consensus of $10.93 billion.

The revisions to our Current Guidance compared to our Prior Guidance primarily include:

• An increase in estimated sales for Communication Systems primarily related to higher expected DoD sales;
• An increase in estimated operating margin for Communication Systems due to higher sales volume and a higher than expected gain on the sale of the company’s property in San Carlos, California, partially offset by higher than expected restructuring expenses in connection with the consolidation of the EDD/ETI TWT businesses;
• A decrease in the effective tax rate primarily due to higher than expected tax benefits related to share-based compensation awards and R&E tax credits, partially offset by increases in minority interest expense and diluted shares; and
• With respect to free cash flow, reclassification of the actual proceeds received from the sale of the company’s property in San Carlos, California, to capital expenditures, net of dispositions from net cash from operating activities. Previously, the expected proceeds were presented as offsetting expected restructuring and severance expenses in connection with the consolidation of the company’s EDD/ETI TWT businesses and presented in net cash from operating activities.

For earnings history and earnings-related data on L-3 Communications (LLL) click here.

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