Huntington Ingalls Industries (HII) Tops Q4 EPS by $1.59, Revenues Beat; Offers FY21 Revenue Guidance Above Consensus

February 11, 2021 7:18 AM EST

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Huntington Ingalls Industries (NYSE: HII) reported Q4 EPS of $6.15, $1.59 better than the analyst estimate of $4.56. Revenue for the quarter came in at $2.76 billion versus the consensus estimate of $2.41 billion.

  • Revenues were $2.8 billion in the quarter; $9.4 billion in 2020
  • Operating margin was 11.1% in the quarter; 8.5% in 2020
  • Diluted earnings per share was $6.15 in the quarter, $17.14 in 2020
  • Cash from operations was $1.1 billion, and free cash flow1 was $757 million in 2020
  • Backlog of $46.0 billion at year end

“2020 will be remembered as one of the most challenging business environments that we have ever had to navigate. Throughout the COVID-19 pandemic, we have made decisions that are focused on the safety and well being of our employees, and I could not be prouder of the way our team responded to the challenges. We enter 2021 as a stronger and more agile company with positive momentum and an enormous opportunity in front of us to leverage our $46 billion backlog to drive long-term, sustainable value creation,” said Mike Petters, HII’s president and CEO.

GUIDANCE:

Huntington Ingalls Industries sees FY2021 revenue of $9.2-9.4 billion, versus the consensus of $9.09 billion.

2021 Outlook

  • Expect FY21 shipbuilding revenue1 between $8.2 and $8.4 billion; and shipbuilding operating margin1 between 7.0% and 8.0%
  • Expect FY21 Technical Solutions revenue of approximately $1.0 billion and segment operating margin1 between 3.0% and 5.0%
  • Expect FY21 free cash flow1 between $150 and $250 million
  • Expect cumulative FY20-FY24 free cash flow1 of approximately $3 billion

The financial outlook, expectations and other forward looking statements provided by the company for 2021 and beyond, reflect the company's judgment based on the information available at the time of this release.

The COVID-19 global pandemic has had wide ranging effects on the global health environment and disrupted the global and U.S. economies and financial markets, including impacts to our employees, customers, suppliers, and communities. The pandemic is also impacting our operations, and the full impacts of COVID-19 on our fiscal year 2021 financial results and beyond are uncertain. We believe that the most significant elements of uncertainty are the intensity and duration of the impact on our employees’ ability to work effectively, disruption in our supply chain, disruption of the U.S. Government's and our other customers' abilities to perform their obligations, and impact on pension assets and other investment performance.

We have incurred and expect to continue incurring costs related to our COVID-19 response, including paid leave, quarantining employees and recurring facility cleaning. While our shipyards and other facilities remainopen and productive, we experienced temporary decreases in workforce attendance, which impacted our operations due to delay and disruption from the lack of availability of critical skills and out-of-sequence work. As of December 31, 2020, workforce attendance has returned to standard rates.

For earnings history and earnings-related data on Huntington Ingalls Industries (HII) click here.



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