Huntington Reports $40 Million Profit After Loss Last Year
Huntington Ingalls Industries Inc., the U.S. Navy’s largest builder of surface warships, said it made a profit in the second quarter after a loss in the same period last year.
Net income was $40 million, or 80 cents a share, compared with a loss of $11 million for the same period last year, the Newport News, Virginia-based company said today. Sales declined 2.9 percent to $1.56 billion. Huntington was spun off from Northrop Grumman Corp. (NOC) in April and reported pro forma results for 2010.
The average of nine analysts surveyed by Bloomberg was for profit of 82 cents a share on sales of $1.66 billion.
Chief Executive Officer Mike Petters has promised investors that Huntington would boost profit margins to 9 percent by 2015 from the current 5.5 percent. The company is focusing on improving quality, cutting costs, delivering ships on time to the U.S. Navy and shutting down its Avondale, Louisiana, yard.
Huntington didn’t offer an estimate of full-year earnings and sales. That “lack of visibility makes it difficult for investors to see progress against clear milestones,” Douglas Harned, an analyst at New York-based Sanford C. Bernstein, wrote in a note to clients.
Huntington declined 18 cents to $27.83 in New York Stock Exchange composite trading. The shares have fallen 33 percent since the company was spun off in April.
Overall company profit margin was 5.8 percent compared with a loss in the same period last year, Huntington said.
Sales at the company’s Ingalls unit fell less than 1 percent to $708 million on lower sales of DDG-51 destroyers, the company said. The unit’s revenue for the same period last year was lowered by $115 million arising from costs to close the Avondale yard, Huntington said.
Revenue at the Newport News unit, which builds nuclear- powered aircraft carriers and submarines, fell 4.5 percent to $872 million because of lower volume of maintenance and overhaul work on the USS Theodore Roosevelt and construction work on the new Gerald R. Ford class aircraft carrier, the company said.
Profit at Newport News fell 6 percent to $79 million, Huntington said.
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