Oct. 23 (Bloomberg) -- General Dynamics Corp., the U.S. government’s No. 3 contractor, reported third-quarter profit that rose 8.5 percent and beat analysts’ estimates.
Net income was $651 million, or $1.84 a share, up from $600 million, or $1.70 a share, a year earlier, the Falls Church, Virginia-based company said today in a statement. That compared with $1.68-a-share estimate of 19 analysts surveyed by Bloomberg.
The company raised its full-year profit forecast to $6.90 to $7 a share, up from the previous outlook of $6.85 to $6.95. The guidance assumes “there is no residual impact” from this month’s partial U.S. government shutdown, Phebe Novakovic, the contractor’s chief executive officer, said on a conference call with analysts and investors.
Sales fell 1.7 percent to $7.8 billion in the quarter from a year earlier. The company reported a backlog of $47.9 billion at the end of the quarter, compared with $49.4 billion at the end of the second quarter.
General Dynamics fell 2.2 percent to close at $86.23.
Higher sales of General Dynamics’ Gulfstream business jets have helped offset some of the declines in military revenue.
Across-the-board federal budget cuts stripped $37 billion from Pentagon programs in the year ended Sept. 30 and will cut about $50 billion from planned spending in the current fiscal year.
General Dynamics, which makes Abrams tanks, has risen 27 percent this year through yesterday. The Standard & Poor’s 500 Index gained 23 percent during the same period.
The No. 1 federal contractor, Lockheed Martin Corp., yesterday raised its full-year forecast as its third-quarter profit rose 16 percent.
United Technologies Corp., the No. 6 contractor, yesterday reduced its sales forecast for the year. The Hartford, Connecticut-based company said Pentagon spending cuts contributed to a decline in sales.
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