General Dynamics has reported first-quarter 2020 net earnings of $706 million on $8.75 billion in revenue. On a per share basis, diluted earnings per share (EPS) were $2.43, the company announced on Thursday.
"Since the onset of the COVID-19 crisis, we have supported our government customers and implemented multiple safety measures to keep our people as safe as possible," said Phebe N. Novakovic, chairman and chief executive officer and six-time Wash100 Award recipient. "We are responding to the COVID travel restrictions' impact on Gulfstream and are managing our costs throughout our business."
The company noted that travel restrictions due to the COVID-19 pandemic delayed deliveries of business-jet aircraft, which resulted in a $549 million decline in revenue for the Aerospace segment. Nevertheless, the segment's backlog remains strong, up $1.1 billion over last year’s quarter.
The defense businesses on a combined basis posted revenue of $7.1 billion and operating earnings of $705 million, 2.2 percent above the last quarter, and margin of 10 percent, an expansion of 20 basis points over the year-ago quarter.
General Dynamics repurchased 3.4 million of its outstanding shares in the first quarter to cover dilution from the exercise of stock options. The company’s board of directors increased the quarterly dividend 8 cents to $1.10 per share, which was the company's 23rd consecutive annual dividend increase.
General Dynamics’ total backlog at the end of first-quarter 2020 was $85.7 billion, up 23.9 percent year-over-year. The estimated potential contract value, representing management's estimate of value in unfunded indefinite delivery, indefinite quantity (IDIQ) contracts and unexercised options, was $38.1 billion.
The company secured multiple awards in the quarter, including an IDIQ contract with a maximum potential value of $885 million to modernize the U.S. Army's training programs and $875 million for the construction of two additional U.S. Navy John Lewis-class (T-AO-205) oilers.
In addition, General Dynamics won an IDIQ contract with a maximum potential value of $505 million to provide supercomputing resources to the National Oceanic Atmospheric Administration's (NOAA) Weather and Climate Operational Supercomputing System (WCOSS) and a $300 million from the Army to upgrade Abrams tanks to the M1A2 System Enhancement Package Version 3 (SEPv3) configuration and $225 million for parts and support for Stryker armored fighting vehicles.
About General Dynamics
Headquartered in Reston, 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.