General Dynamics Reports First-Quarter 2014 Results
OREANDA-NEWS. General Dynamics (NYSE: GD) today reported first-quarter 2014 net earnings of USD 595 million, or USD 1.71 per share on a diluted basis, compared to 2013 first-quarter net earnings of USD 571 million, or USD 1.62 per diluted share. First-quarter 2014 revenues were USD 7.3 billion.
Company-wide operating margins for the first quarter of 2014 were 11.9 percent, a 50 basis points improvement when compared to 11.4 percent in first-quarter 2013.
Net cash provided by operating activities in the quarter totaled USD 428 million. Free cash flow from operations, defined as net cash provided by operating activities less capital expenditures, was USD 341 million in first-quarter 2014. In comparison, for the first quarter of 2013, net cash provided by operating activities was USD 504 million, and free cash flow from operations was USD 429 million.
The company repurchased 14.4 million of its outstanding shares in the first quarter. In addition, in March, the board of directors increased the company’s quarterly dividend by 10.7 percent to USD 0.62 per share, representing the company’s 17th consecutive annual dividend increase.
Funded backlog at the end of first-quarter 2014 was USD 48.3 billion, and total backlog was USD 56 billion, a more than 20 percent increase from year-end 2013. The company received a USD 10 billion 14-year contract from the Government of Canada’s Canadian Commercial Corporation to provide military and commercial vehicles, training, and support services to an international customer, with USD 3 billion in options. Additional significant awards received in the quarter include USD 645 million for an additional Arleigh Burke-class destroyer, USD 520 million for long-lead material for Virginia-class Block IV submarines, USD 210 million for continued support of the U.K.’s Bowman tactical communication system, and USD 165 million for combat and seaframe control systems on the Navy’s Independence-variant Littoral Combat Ship.
In addition to total backlog, estimated potential contract value, representing management’s estimate of value in unfunded indefinite delivery, indefinite quantity (IDIQ) contracts and unexercised options, was USD 28.7 billion. Total potential contract value, the sum of all backlog components, was USD 84.7 billion at the end of the quarter.
“General Dynamics’ first quarter operating performance was strong, demonstrated by 11.9 percent operating margins,” said Phebe N. Novakovic, chairman and chief executive officer. “2014 is off to a solid start as we remain committed to robust operating performance, engaging in wise capital deployment and driving excellence throughout the company.”