Lockheed Martin and Northrop Grumman, two of the world's biggest defense contractors, reported higher fourth-quarter profits Thursday on the back of strong military and civil electronics sales.
The two companies, which are the Pentagon's No. 1 and No. 3 suppliers respectively, both forecast growth in profit for the full year, as U.S. defense spending shows no sign of slipping in President George W. Bush's last year in office.
The results match higher profits posted by No. 4 U.S. defense contractor General Dynamics on Wednesday.
Boeing, the U.S. No 2 military supplier, is set to report earnings next week.
Shares of Lockheed , which easily beat Wall Street profit forecasts, rose about 1 percent in early trading on the New York Stock Exchange. Northrop, which hit Wall Street's average estimate, saw its shares dip 2 percent.
Lockheed, which is the world's largest defense contractor, reported a greater-than expected 10 percent rise in quarterly profit to $799 million, or $1.89 per share. That exceeded Wall Street's average forecast of $1.70 per share, according to Reuters Estimates.
The Bethesda, Maryland-based company reported lower quarterly revenue from its F-16 fighter jet, which is now made only for overseas military forces, and also from its new F-35 fighter, which is still in the early stages of production.
But those declines were offset by higher revenue at its electronics, information and space systems units, helped by sales of its technology services for military and civil use.
Overall sales were flat at $10.8 billion.
Citing improvements in its aeronautics business, Lockheed raised its full-year earnings forecast to a range of $7.05 to $7.25 per share, up from its previous forecast of $6.95 to $7.15 per share. Analysts are expecting $7.29 per share, on average.
Northrop Profit Edges Up
Northrop, known for its B-2 bomber, Global Hawk unmanned aircraft and a range of warships and submarines, reported slightly higher fourth-quarter profit and forecast full-year profit in line with Wall Street estimates.