Cautioned About Further Delays, GD Reduces Earning Expectations

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General Dynamics reported today second-quarter 2012 earnings from continuing operations of $634 million, compared with $666 million in the second quarter of 2011. Revenues in the quarter were $7.9 billion. Net earnings for the second quarter of 2012 were $634 million, compared to $653 million. Funded backlog has also declined slightly in the second quarter, compared to first-quarter 2012. “General Dynamics’ operating results in the second quarter reflect our continued focus on disciplined execution and effective cash conversion across the corporation,” said Jay L. Johnson, chairman and chief executive officer.


According to the report, demand for information technology (IT) services was strong in the quarter. The company’s total backlog at the end of second-quarter 2012 was $52.4 billion. In addition, the estimated potential contract value was an additional $26.2 billion, representing management’s estimate of value under unfunded IDIQ contracts and unexercised options, bringing the sum of all backlog components exceeded $78 billion at the end of the quarter.

“Heading into the second half of 2012, I remain very confident in our continued ability to execute. However, given the impact of first-half award delays in IS&T’s tactical communications business, as well as the likelihood of further delays in the second half, I believe it is prudent to revise the full-year earnings guidance range downward to $7.00 to $7.10 per share, fully diluted.”