UPDATE: General Dynamics Tops Q4 Expectations

reported a stronger-than-expected earnings for the fourth quarter. The Falls Church, Virginia-based company reported a quarterly profit of $701 million, or $2.09 per share, compared to $495 million, or $1.40 per share, in the year-ago period. Excluding discontinued operations, the company's earnings from continuing operations came in at $2.19 per share. Its revenue gained 3.9% to $8.36 billion. However, analysts were expecting a profit of $2.13 per share on revenue of $8.04 billion. Operating margin widened by 1.3% to 12.8%, while operating costs and expenses rose 2.4% in the quarter. At the end of the year, General Dynamics' backlog increased 58% y/y to $72.4 billion. The company's revenue in its information systems and technology business declined 8.3%, while aerospace revenue surged 4.9%. Combat systems revenue gained 1.4% in the period, while marine systems revenue rose 25.2%. "General Dynamics' performance in 2014 was very strong," said Phebe N. Novakovic, General Dynamics chairman and chief executive officer. "We did what we said we would: increase operating earnings, margins and EPS through a relentless focus on operations and prudent capital deployment.” General Dynamics shares fell 2.04% to close at $137.20 yesterday.