Market Overview

General Dynamics Reports Second-Quarter 2019 Results

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FALLS CHURCH, Va., July 24, 2019 /PRNewswire/ --

  • Revenue of $9.6 billion, up 4% year-over-year
  • Diluted earnings per share of $2.77, up 5.7% year-over-year
  • Gulfstream G600 achieves FAA certification

General Dynamics (NYSE:GD) today reported second-quarter 2019 revenue of $9.6 billion, up 4 percent year-over-year, with net earnings of $806 million. Diluted earnings per share were $2.77, an increase of 5.7 percent year-over-year.

Operating margins increased sequentially by 50 basis points over the previous quarter to 11.4 percent. In June, the all-new Gulfstream G600 earned both its type and production certificates from the U.S. Federal Aviation Administration.

"Our second-quarter results reflect our relentless focus on driving down costs and improving performance," said Phebe Novakovic, chairman and chief executive officer. "That focus on performance remains unwavering as we ramp up production of new aircraft, begin construction of both a new block and new class of submarines, and solidify our market-leading position in Information Technology."

Backlog
General Dynamics' total backlog at the end of second-quarter 2019 was $67.7 billion. Estimated potential contract value, representing management's estimate of value in unfunded indefinite delivery, indefinite quantity (IDIQ) contracts and unexercised options, was $34.2 billion. Total estimated contract value, the sum of all backlog components, was $101.9 billion, up 3 percent year-over-year.

Order activity remained strong across the aerospace and defense portfolios. Aerospace booked $2.2 billion in orders in the quarter, a 1-to-1 book-to-bill on 12.7 percent year-over-year revenue growth. Significant awards in defense portfolios in the quarter included $495 million from the U.S. Navy for industrial base development and expansion in support of the Columbia-class ballistic missile submarine program, $360 million in contracts to provide intelligence services to classified customers, $270 million from the Navy to support the joint U.S. and U.K. development of the submarine Common Missile Compartment and $260 million from the U.S. Army for production of munitions. Information Technology posted a strong book-to-bill of 1.2-to-1, driven by a $1 billion U.S. Department of State contract to provide global engineering and supply chain services.

About General Dynamics
Headquartered in Falls Church, Virginia, General Dynamics is a global aerospace and defense company that offers a broad portfolio of products and services in business aviation; combat vehicles, weapons systems and munitions; IT services; C4ISR solutions; and shipbuilding and ship repair. General Dynamics employs more than 100,000 people worldwide and generated $36.2 billion in revenue in 2018. More information is available at www.generaldynamics.com.

Certain statements made in this press release, including any statements as to future results of operations and financial projections, may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. Forward-looking statements are based on management's expectations, estimates, projections and assumptions. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict. Therefore, actual future results and trends may differ materially from what is forecast in forward-looking statements due to a variety of factors. Additional information regarding these factors is contained in the company's filings with the Securities and Exchange Commission, including, without limitation, its Annual Report on Form 10-K and its Quarterly Reports on Form 10-Q. All forward-looking statements speak only as of the date they were made. The company does not undertake any obligation to update or publicly release any revisions to forward-looking statements to reflect events, circumstances or changes in expectations after the date of this press release.

WEBCAST INFORMATION: General Dynamics will webcast its second-quarter 2019 financial results conference call at 9 a.m. EDT on Wednesday, July 24, 2019. The webcast will be a listen-only audio event available at www.generaldynamics.com. An on-demand replay of the webcast will be available by 12 p.m. on July 24 and will continue for 12 months. To hear a recording of the conference call by telephone, please call 877-344-7529 (international: 412-317-0088); passcode 10132448. The phone replay will be available through August 1, 2019.

Charts furnished to investors and securities analysts in connection with General Dynamics' announcement of its financial results for second-quarter 2019 are available at www.generaldynamics.com.

 

 

EXHIBIT A

CONSOLIDATED STATEMENT OF EARNINGS - (UNAUDITED)

DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS

















Three Months Ended


Variance


June 30, 2019


July 1, 2018*


$


%

Revenue

$

9,555



$

9,186



$

369



4.0

%

Operating costs and expenses

(8,465)



(8,098)



(367)




Operating earnings

1,090



1,088



2



0.2

%

Interest, net

(119)



(103)



(16)




Other, net

12



(15)



27




Earnings before income tax

983



970



13



1.3

%

Provision for income tax, net

(177)



(184)



7




Net earnings

$

806



$

786



$

20



2.5

%

Earnings per share—basic

$

2.80



$

2.65



$

0.15



5.7

%

Basic weighted average shares outstanding

288.1



296.2



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