Lockheed Martin achieved a high level of mission success in 1998 but faced some setbacks. Sales increased modestly while earnings per share grew slightly after adjusting for non-recurring items. The company aims to improve performance in 1999 through management accountability and productivity increases in order to enhance shareholder value over the long run.
This document provides selected financial data for Mohawk Industries for the years 2003-2002. It includes statements of earnings, balance sheets, and cash flows. It also discusses critical accounting policies including inventory valuation, accounts receivable, revenue recognition, goodwill and intangible asset impairments, and deferred taxes. The company acquired Dal-Tile in 2002 and Lees Carpet in 2003 to expand into ceramic tile and commercial carpet markets.
This document contains selected financial data for Mohawk Industries for the years 2002 to 1997. It includes key statement of earnings and balance sheet figures such as net sales, gross profit, net earnings, assets, liabilities, and stockholders' equity. It also notes certain one-time restructuring charges, asset write-downs, and legal settlements over this period. The data is presented annually and is intended to provide an overview of Mohawk Industries' financial performance and position over several years.
The document discusses various financial analysis tools and frameworks used to analyze Dell Inc., including income statements, balance sheets, ratio analysis, BCG matrix, SWOT analysis, and strategic frameworks. It provides an overview of Dell's vision, mission, and financial statements for fiscal years 2009-2011. The ratios analysis section then calculates key financial ratios for liquidity, profitability, solvency, and activity for each fiscal year.
1) The McGraw-Hill Companies achieved record financial results in 2007, with revenue growing 8.3% to $6.8 billion and net income rising 14.9% to $1 billion, however challenges emerged as the US housing bubble burst.
2) The company remains focused on providing high-quality information and insights to help customers succeed, while generating superior shareholder value through consistent earnings growth and returning $2.5 billion to shareholders in 2007.
3) While the current market turmoil is difficult to predict, the long-term prospects for the company's markets remain strong due to enduring global trends of needing capital, knowledge, and transparent business information.
The McGraw-Hill Companies 2006 Annual Report summarizes the company's strong financial performance and positions it for continued growth.
1) McGraw-Hill achieved record revenue of $6.3 billion and net income of $882 million in 2006. It also returned $1.8 billion to shareholders through dividends and share repurchases, with a total shareholder return of 33.5%.
2) The company's strategy focuses on expanding globally, developing digital and technology-driven solutions, and investing in its businesses. All business segments are expected to contribute to continued growth in 2007.
3) McGraw-Hill is well-positioned to capitalize on trends in global capital markets, education
The document is McGraw-Hill's 2008 annual report which discusses the financial challenges faced by the company that year due to the global recession. It summarizes that revenue declined 6.2% to $6.4 billion while net income fell 21.1% to $799.5 million. However, the company remained profitable and had a strong balance sheet which positioned it well to weather the economic storm. The report discusses questions around what caused the financial crisis, the role of credit ratings, and trends that will shape future capital markets and opportunities.
GM reported preliminary results for Q4 2008 and calendar year 2008. For Q4, GM had an adjusted net loss of $5.9 billion compared to an adjusted net loss of $4.6 billion in Q4 2007. For the full year, GM had an adjusted net loss of $16.8 billion compared to an adjusted net loss of $1.4 billion in 2007. Weak global automotive markets, lower volumes and unfavorable mix drove the significantly higher losses. GM is taking actions to reduce costs and improve its cost structure.
FMC Technologies is a global leader that has provided customer solutions for over 100 years. It operates manufacturing facilities in 16 countries and designs systems for the energy, food processing, and air transportation industries. In 2001, the company saw strong demand and order backlog growth in its energy business, particularly for subsea oil and gas equipment. However, its food processing and airport systems segments struggled due to economic weakness affecting their customers. The company expects continued growth in energy but uncertainties in its other businesses depending on the speed of economic recovery.
This document provides selected financial data for Mohawk Industries for the years 2003-2002. It includes statements of earnings, balance sheets, and cash flows. It also discusses critical accounting policies including inventory valuation, accounts receivable, revenue recognition, goodwill and intangible asset impairments, and deferred taxes. The company acquired Dal-Tile in 2002 and Lees Carpet in 2003 to expand into ceramic tile and commercial carpet markets.
This document contains selected financial data for Mohawk Industries for the years 2002 to 1997. It includes key statement of earnings and balance sheet figures such as net sales, gross profit, net earnings, assets, liabilities, and stockholders' equity. It also notes certain one-time restructuring charges, asset write-downs, and legal settlements over this period. The data is presented annually and is intended to provide an overview of Mohawk Industries' financial performance and position over several years.
The document discusses various financial analysis tools and frameworks used to analyze Dell Inc., including income statements, balance sheets, ratio analysis, BCG matrix, SWOT analysis, and strategic frameworks. It provides an overview of Dell's vision, mission, and financial statements for fiscal years 2009-2011. The ratios analysis section then calculates key financial ratios for liquidity, profitability, solvency, and activity for each fiscal year.
1) The McGraw-Hill Companies achieved record financial results in 2007, with revenue growing 8.3% to $6.8 billion and net income rising 14.9% to $1 billion, however challenges emerged as the US housing bubble burst.
2) The company remains focused on providing high-quality information and insights to help customers succeed, while generating superior shareholder value through consistent earnings growth and returning $2.5 billion to shareholders in 2007.
3) While the current market turmoil is difficult to predict, the long-term prospects for the company's markets remain strong due to enduring global trends of needing capital, knowledge, and transparent business information.
The McGraw-Hill Companies 2006 Annual Report summarizes the company's strong financial performance and positions it for continued growth.
1) McGraw-Hill achieved record revenue of $6.3 billion and net income of $882 million in 2006. It also returned $1.8 billion to shareholders through dividends and share repurchases, with a total shareholder return of 33.5%.
2) The company's strategy focuses on expanding globally, developing digital and technology-driven solutions, and investing in its businesses. All business segments are expected to contribute to continued growth in 2007.
3) McGraw-Hill is well-positioned to capitalize on trends in global capital markets, education
The document is McGraw-Hill's 2008 annual report which discusses the financial challenges faced by the company that year due to the global recession. It summarizes that revenue declined 6.2% to $6.4 billion while net income fell 21.1% to $799.5 million. However, the company remained profitable and had a strong balance sheet which positioned it well to weather the economic storm. The report discusses questions around what caused the financial crisis, the role of credit ratings, and trends that will shape future capital markets and opportunities.
GM reported preliminary results for Q4 2008 and calendar year 2008. For Q4, GM had an adjusted net loss of $5.9 billion compared to an adjusted net loss of $4.6 billion in Q4 2007. For the full year, GM had an adjusted net loss of $16.8 billion compared to an adjusted net loss of $1.4 billion in 2007. Weak global automotive markets, lower volumes and unfavorable mix drove the significantly higher losses. GM is taking actions to reduce costs and improve its cost structure.
FMC Technologies is a global leader that has provided customer solutions for over 100 years. It operates manufacturing facilities in 16 countries and designs systems for the energy, food processing, and air transportation industries. In 2001, the company saw strong demand and order backlog growth in its energy business, particularly for subsea oil and gas equipment. However, its food processing and airport systems segments struggled due to economic weakness affecting their customers. The company expects continued growth in energy but uncertainties in its other businesses depending on the speed of economic recovery.
The document provides financial and operational highlights for OGX in 2012:
- OGX achieved its first oil production and revenues in 2012, producing 3.2 million barrels of oil with revenues of R$325 million.
- Exploration successes included new oil and gas discoveries and declarations of commerciality for three new fields.
- Production is advancing with ramp up of the Gavião Real gas field and further development of the Tubarão fields.
- OGX has a cash position of R$3.4 billion and plans a 2013 capital expenditure budget of US$1.3 billion focused on development and exploration.
This document provides an annual report summary for Lockheed Martin Corporation for 1999. It includes financial highlights showing a decline in net sales and earnings compared to 1998. It discusses both positive and negative factors impacting performance, including program issues for some aerospace and space systems but also new orders and backlog increases. It outlines actions being taken to improve focus on core customers, cash flow, debt reduction, and management practices to return performance to higher levels and increase shareholder value.
1) The document is an audited revenue account for an insurance company for the year ending March 31, 2010. It shows revenues of over 99 billion rupees including over 54 billion in premiums earned and over 40 billion in investment income.
2) Expenses totaled over 18 billion rupees including over 5 billion in commissions and over 13 billion in operating expenses.
3) Benefits paid were over 11 billion rupees while changes in valuation of life insurance policies liabilities totaled over 78 billion rupees.
4) The surplus for the year was over 1.8 billion rupees with over 1.6 billion carried forward to funds for future appropriations.
Credit Suisse reported a net loss of CHF 3.3 billion for full year 2002, with CSFB losing CHF 1.9 billion and CSFS losing CHF 165 million. Special items including investment losses, restructuring charges, and litigation reserves accounted for CHF 4.8 billion of the losses. Winterthur, CS's insurance subsidiary, took measures to refocus on core markets and improve profitability including cost reductions and a streamlined management structure.
Canlan Ice Sports Corp. is a Canada-based company that owns and operates recreational ice sports facilities across North America. It owns or manages 22 facilities with 63 sheets of ice. Canlan has grown steadily in recent years through expanding into new US markets and leveraging successful programming. Its strategy focuses on further expansion in the US, increasing facility utilization through programs, and new marketing initiatives. As the largest operator of ice facilities, Canlan has strong brand recognition, customer loyalty, and high barriers to entry due to capital requirements.
Schering-Plough is a global pharmaceutical company focused on research and developing new therapies. In 2000, the company achieved 8% sales growth to $9.8 billion, led by its pharmaceutical business. Key therapeutic areas include allergy/respiratory, where sales grew 9% to $4.2 billion, driven by the antihistamine Claritin. The company is working to expand its allergy franchise with new products like Clarinex and strengthen its position in other areas like cancer and inflammation. Research and marketing efforts aim to continue delivering new treatments and driving international expansion.
0 koon financial analysis-final editionafterrefloat
The document discusses Koon Holdings Limited, a Singapore-based investment holding company with expertise in infrastructure construction, plant and equipment rental, and precast concrete works. It provides an overview of Koon's financial performance, industry and competitors, as well as recommendations to leverage its competitive strengths such as an experienced management team and wide range of products and services to capitalize on industry opportunities like upcoming public construction projects.
The document summarizes plans for a new Dole Wellness Center, Spa and Hotel complex to be built in Westlake Village, California. The complex will include a 267-room luxury hotel, full-service spa and fitness facility, comprehensive medical clinic and diagnostic center, wellness center, and television production studio focused on health and wellness programming. The goal is to provide visitors tools and treatments to improve their health and quality of life through nutrition, fitness, and preventative healthcare. The $150 million complex is expected to open in March 2006.
The document discusses Duke Energy's use of non-GAAP financial measures to evaluate performance, including ongoing earnings per share, ongoing segment EBIT, and other measures adjusted for special items. It provides context for these measures and notes that special items represent charges and credits that are not expected to recur regularly. It also states that reconciliations to the most directly comparable GAAP measures are not possible due to the inability to forecast future special items.
This document provides an annual summary report for Apache Corporation for 2004. Some key details:
- Apache had a record year in 2004, with earnings of $1.7 billion, up nearly 50% from 2003. Assets grew to $15.5 billion.
- Apache increased its worldwide proved reserves 17% to 1.94 billion barrels of oil equivalent, marking its 19th consecutive year of reserve growth. Average daily production grew 7.4% to 448,000 barrels of oil equivalent.
- Apache's acquisition of assets from ExxonMobil added production and exploration opportunities in regions like the Permian Basin and Gulf of Mexico, strengthening its portfolio.
VF Corporation had a successful fiscal year 2006, with total revenues increasing to $6.2 billion, up 10% from 2005. Operating income grew 7.5% to $826 million. The company continued to innovate across its brands through new product introductions, expanded geographic reach, and enhanced marketing campaigns. Key initiatives included the Wrangler brand dominating the professional rodeo circuit, Kipling expanding its U.S. boutiques, innovative new products like The North Face athletes' summit of Mount Everest, and JanSport backpacks integrating Bluetooth and iPod technology.
GM reported preliminary results for Q4 2008 and the full year. Key highlights included:
- Q4 GAAP net loss of $9.6B and full year GAAP net loss of $30.9B.
- Q4 and full year adjusted net losses excluded several special items totaling billions.
- Weak global automotive markets significantly reduced revenues and earnings compared to prior year.
- GM is required to revalue derivatives on its balance sheet to reflect its declining creditworthiness, contributing to losses.
- OGX reached an important milestone in 2012 by beginning oil production in the Tubarão Azul Field, only 4 years after its creation. Production reached 3.2 million barrels in 2012.
- OGX posted its first revenues of R$325 million in 2012 from oil sales.
- Important advances were made in exploration, including new commercial discoveries. However, initial production estimates for some wells were lower than expected.
- As of December 2012, OGX had a cash position of R$3.4 billion to develop its portfolio and pursue new opportunities. Average daily production was around 9.8 kboepd for the year.
Satellite TV dishes on tens of millions of homes and seamless global telephone service are some developing markets driving a $70 billion satellite and wireless industry. Hughes is uniquely positioned to take advantage of opportunities in this industry due to its leadership in satellite and wireless systems, proven record of innovation, strong finances, and highly skilled workforce.
FMC Technologies is a leading global provider of technology solutions for the energy industry. In 2006, the company achieved strong financial performance with revenues of $3.8 billion, a 21% increase over 2005, and income from continuing operations of $211.5 million, a 61% rise. Key drivers of growth included increasing demand for subsea production systems and surface wellhead equipment. FMC Technologies also strengthened its position in the energy industry by securing several large subsea contracts from major oil companies totaling over $800 million.
During the 3Q07, BRMALLS acquired ownership interests in 7 new malls, adding 147,157 square meters of total space and 77,182 square meters of owned space. BRMALLS also announced three new shopping mall developments in Sao Paulo with a total planned space of 73,800 square meters and expected investment of R$156 million. Throughout 2007, BRMALLS acquired 21 new malls, adding 554,341 square meters of total space and 245,230 square meters of owned space, with an average return on investment of 15.3%.
public serviceenterprise group LEHMAN9-6-06finance20
The document provides an agenda for a presentation by Exelon Corporation and Public Service Enterprise Group at the Lehman Brothers 2006 CEO Energy/Power Conference. It includes forward-looking statements and discusses PSEG's financial overview and year-to-date results, PSEG Power's nuclear and fossil operations and margin growth, and the PJM pricing environment.
bristol myerd squibb Deutsche Bank Securities Inc. Health Care Conferencefinance13
Lamberto Andreotti, Chief Operating Officer of Bristol-Myers Squibb, presented at the Deutsche Bank Healthcare Conference on May 7, 2008. He discussed Bristol-Myers Squibb's strong Q1 2008 performance with 9% underlying sales growth and improved margins. He highlighted several drugs like Plavix, Abilify, and Orencia that showed significant sales increases. Andreotti also outlined Bristol-Myers Squibb's approach to productivity improvements through redesigning supply chain operations, restructuring customer models, and R&D transformation to generate $1.5 billion in savings.
capital oneLehman Brothers Eleventh Annual Lehman Financial Services Conferen...finance13
- Capital One is a top 10 bank and 14th largest depository institution in the US with $87.6B in deposits as of Q4 2007. It is also the 5th largest credit card issuer.
- Capital One is a diversified bank that is now primarily funded by deposits, with deposits comprising 47% of its managed liabilities as of Q4 2007, compared to other major banks that are more reliant on unsecured debt and securitizations.
- The presentation discusses Capital One's business overview, competitive positioning, and funding sources. Forward-looking statements are provided but subject to various risk factors that could cause actual results to differ materially.
capital one Keefe, Bruyette & Woods, Inc. Diversified Financial Services Conf...finance13
Capital One is a top 10 bank and 5th largest credit card issuer. It has seen weakening credit metrics that reflect the deteriorating US economy. The company increased its loan loss allowance by $310M in Q108 to prepare for expected losses. While credit costs rose, increased revenue margins largely offset the impact. Capital One continues efficiency initiatives and managing its balance sheet to sustain profitability despite credit headwinds.
capital oneCapital One Financial Corp. Shareholders Meeting Presentationfinance13
The annual stockholder meeting document discusses Capital One's performance in 2007 and the challenges facing the banking industry. It notes that 2007 was the first year Capital One saw a decline in earnings per share. It also discusses the housing market correction and its prolonged negative impact. Additionally, it provides context on Capital One's deposit size, making it the 13th largest deposit-taking bank in the US.
The document provides financial and operational highlights for OGX in 2012:
- OGX achieved its first oil production and revenues in 2012, producing 3.2 million barrels of oil with revenues of R$325 million.
- Exploration successes included new oil and gas discoveries and declarations of commerciality for three new fields.
- Production is advancing with ramp up of the Gavião Real gas field and further development of the Tubarão fields.
- OGX has a cash position of R$3.4 billion and plans a 2013 capital expenditure budget of US$1.3 billion focused on development and exploration.
This document provides an annual report summary for Lockheed Martin Corporation for 1999. It includes financial highlights showing a decline in net sales and earnings compared to 1998. It discusses both positive and negative factors impacting performance, including program issues for some aerospace and space systems but also new orders and backlog increases. It outlines actions being taken to improve focus on core customers, cash flow, debt reduction, and management practices to return performance to higher levels and increase shareholder value.
1) The document is an audited revenue account for an insurance company for the year ending March 31, 2010. It shows revenues of over 99 billion rupees including over 54 billion in premiums earned and over 40 billion in investment income.
2) Expenses totaled over 18 billion rupees including over 5 billion in commissions and over 13 billion in operating expenses.
3) Benefits paid were over 11 billion rupees while changes in valuation of life insurance policies liabilities totaled over 78 billion rupees.
4) The surplus for the year was over 1.8 billion rupees with over 1.6 billion carried forward to funds for future appropriations.
Credit Suisse reported a net loss of CHF 3.3 billion for full year 2002, with CSFB losing CHF 1.9 billion and CSFS losing CHF 165 million. Special items including investment losses, restructuring charges, and litigation reserves accounted for CHF 4.8 billion of the losses. Winterthur, CS's insurance subsidiary, took measures to refocus on core markets and improve profitability including cost reductions and a streamlined management structure.
Canlan Ice Sports Corp. is a Canada-based company that owns and operates recreational ice sports facilities across North America. It owns or manages 22 facilities with 63 sheets of ice. Canlan has grown steadily in recent years through expanding into new US markets and leveraging successful programming. Its strategy focuses on further expansion in the US, increasing facility utilization through programs, and new marketing initiatives. As the largest operator of ice facilities, Canlan has strong brand recognition, customer loyalty, and high barriers to entry due to capital requirements.
Schering-Plough is a global pharmaceutical company focused on research and developing new therapies. In 2000, the company achieved 8% sales growth to $9.8 billion, led by its pharmaceutical business. Key therapeutic areas include allergy/respiratory, where sales grew 9% to $4.2 billion, driven by the antihistamine Claritin. The company is working to expand its allergy franchise with new products like Clarinex and strengthen its position in other areas like cancer and inflammation. Research and marketing efforts aim to continue delivering new treatments and driving international expansion.
0 koon financial analysis-final editionafterrefloat
The document discusses Koon Holdings Limited, a Singapore-based investment holding company with expertise in infrastructure construction, plant and equipment rental, and precast concrete works. It provides an overview of Koon's financial performance, industry and competitors, as well as recommendations to leverage its competitive strengths such as an experienced management team and wide range of products and services to capitalize on industry opportunities like upcoming public construction projects.
The document summarizes plans for a new Dole Wellness Center, Spa and Hotel complex to be built in Westlake Village, California. The complex will include a 267-room luxury hotel, full-service spa and fitness facility, comprehensive medical clinic and diagnostic center, wellness center, and television production studio focused on health and wellness programming. The goal is to provide visitors tools and treatments to improve their health and quality of life through nutrition, fitness, and preventative healthcare. The $150 million complex is expected to open in March 2006.
The document discusses Duke Energy's use of non-GAAP financial measures to evaluate performance, including ongoing earnings per share, ongoing segment EBIT, and other measures adjusted for special items. It provides context for these measures and notes that special items represent charges and credits that are not expected to recur regularly. It also states that reconciliations to the most directly comparable GAAP measures are not possible due to the inability to forecast future special items.
This document provides an annual summary report for Apache Corporation for 2004. Some key details:
- Apache had a record year in 2004, with earnings of $1.7 billion, up nearly 50% from 2003. Assets grew to $15.5 billion.
- Apache increased its worldwide proved reserves 17% to 1.94 billion barrels of oil equivalent, marking its 19th consecutive year of reserve growth. Average daily production grew 7.4% to 448,000 barrels of oil equivalent.
- Apache's acquisition of assets from ExxonMobil added production and exploration opportunities in regions like the Permian Basin and Gulf of Mexico, strengthening its portfolio.
VF Corporation had a successful fiscal year 2006, with total revenues increasing to $6.2 billion, up 10% from 2005. Operating income grew 7.5% to $826 million. The company continued to innovate across its brands through new product introductions, expanded geographic reach, and enhanced marketing campaigns. Key initiatives included the Wrangler brand dominating the professional rodeo circuit, Kipling expanding its U.S. boutiques, innovative new products like The North Face athletes' summit of Mount Everest, and JanSport backpacks integrating Bluetooth and iPod technology.
GM reported preliminary results for Q4 2008 and the full year. Key highlights included:
- Q4 GAAP net loss of $9.6B and full year GAAP net loss of $30.9B.
- Q4 and full year adjusted net losses excluded several special items totaling billions.
- Weak global automotive markets significantly reduced revenues and earnings compared to prior year.
- GM is required to revalue derivatives on its balance sheet to reflect its declining creditworthiness, contributing to losses.
- OGX reached an important milestone in 2012 by beginning oil production in the Tubarão Azul Field, only 4 years after its creation. Production reached 3.2 million barrels in 2012.
- OGX posted its first revenues of R$325 million in 2012 from oil sales.
- Important advances were made in exploration, including new commercial discoveries. However, initial production estimates for some wells were lower than expected.
- As of December 2012, OGX had a cash position of R$3.4 billion to develop its portfolio and pursue new opportunities. Average daily production was around 9.8 kboepd for the year.
Satellite TV dishes on tens of millions of homes and seamless global telephone service are some developing markets driving a $70 billion satellite and wireless industry. Hughes is uniquely positioned to take advantage of opportunities in this industry due to its leadership in satellite and wireless systems, proven record of innovation, strong finances, and highly skilled workforce.
FMC Technologies is a leading global provider of technology solutions for the energy industry. In 2006, the company achieved strong financial performance with revenues of $3.8 billion, a 21% increase over 2005, and income from continuing operations of $211.5 million, a 61% rise. Key drivers of growth included increasing demand for subsea production systems and surface wellhead equipment. FMC Technologies also strengthened its position in the energy industry by securing several large subsea contracts from major oil companies totaling over $800 million.
During the 3Q07, BRMALLS acquired ownership interests in 7 new malls, adding 147,157 square meters of total space and 77,182 square meters of owned space. BRMALLS also announced three new shopping mall developments in Sao Paulo with a total planned space of 73,800 square meters and expected investment of R$156 million. Throughout 2007, BRMALLS acquired 21 new malls, adding 554,341 square meters of total space and 245,230 square meters of owned space, with an average return on investment of 15.3%.
public serviceenterprise group LEHMAN9-6-06finance20
The document provides an agenda for a presentation by Exelon Corporation and Public Service Enterprise Group at the Lehman Brothers 2006 CEO Energy/Power Conference. It includes forward-looking statements and discusses PSEG's financial overview and year-to-date results, PSEG Power's nuclear and fossil operations and margin growth, and the PJM pricing environment.
bristol myerd squibb Deutsche Bank Securities Inc. Health Care Conferencefinance13
Lamberto Andreotti, Chief Operating Officer of Bristol-Myers Squibb, presented at the Deutsche Bank Healthcare Conference on May 7, 2008. He discussed Bristol-Myers Squibb's strong Q1 2008 performance with 9% underlying sales growth and improved margins. He highlighted several drugs like Plavix, Abilify, and Orencia that showed significant sales increases. Andreotti also outlined Bristol-Myers Squibb's approach to productivity improvements through redesigning supply chain operations, restructuring customer models, and R&D transformation to generate $1.5 billion in savings.
capital oneLehman Brothers Eleventh Annual Lehman Financial Services Conferen...finance13
- Capital One is a top 10 bank and 14th largest depository institution in the US with $87.6B in deposits as of Q4 2007. It is also the 5th largest credit card issuer.
- Capital One is a diversified bank that is now primarily funded by deposits, with deposits comprising 47% of its managed liabilities as of Q4 2007, compared to other major banks that are more reliant on unsecured debt and securitizations.
- The presentation discusses Capital One's business overview, competitive positioning, and funding sources. Forward-looking statements are provided but subject to various risk factors that could cause actual results to differ materially.
capital one Keefe, Bruyette & Woods, Inc. Diversified Financial Services Conf...finance13
Capital One is a top 10 bank and 5th largest credit card issuer. It has seen weakening credit metrics that reflect the deteriorating US economy. The company increased its loan loss allowance by $310M in Q108 to prepare for expected losses. While credit costs rose, increased revenue margins largely offset the impact. Capital One continues efficiency initiatives and managing its balance sheet to sustain profitability despite credit headwinds.
capital oneCapital One Financial Corp. Shareholders Meeting Presentationfinance13
The annual stockholder meeting document discusses Capital One's performance in 2007 and the challenges facing the banking industry. It notes that 2007 was the first year Capital One saw a decline in earnings per share. It also discusses the housing market correction and its prolonged negative impact. Additionally, it provides context on Capital One's deposit size, making it the 13th largest deposit-taking bank in the US.
Intel Corporation projected a 21% increase in total spending from 2005 to 2006 under GAAP. This included a forecasted 10% increase from share-based compensation and a 2% increase from spending at IMFT. Excluding these factors, Intel forecasted a 9% increase in total spending from 2005 to 2006, which included research and development expenses and marketing, general, and administrative expenses.
capital oneSanford C. Bernstein & Co. Strategic Decisions Conference Presenta...finance13
This document discusses Capital One's approach to risk management and positioning for economic cycles. It notes that Capital One has transformed into a diversified bank with significant deposit funding. Capital One assumes recessions and degradation in underwriting and saves repricing for safety and soundness rather than assuming good times will continue. The document also discusses how different lending segments such as credit cards have performed relative to others such as auto loans during past economic downturns.
The annual report summarizes Lockheed Martin's financial and operational performance in 1997. Some key highlights include:
- Net sales reached a record $28.1 billion, up from $26.9 billion in 1996.
- Net earnings were $1.3 billion. Excluding non-recurring items, earnings per share grew 11% over 1996.
- The company achieved significant cost reductions ahead of schedule, and improved competitiveness as evidenced by a record high win rate on competitive bids.
- $1.6 billion in cash was generated in 1997 through free cash flow and divestitures. Cash was used to reduce debt and enhance shareholder value.
- Goals for 1998 include continued cash generation, and
This document provides selected financial data for Mohawk Industries for the years 2003-2002. It includes statements of earnings, balance sheets, and cash flows. It also discusses critical accounting policies including inventory valuation, accounts receivable, revenue recognition, goodwill and intangible asset impairments, and deferred tax assets and liabilities. The company acquired Dal-Tile in 2002 and Lees Carpet in 2003 to expand into ceramic tile and commercial carpet markets.
The document is Lockheed Martin's 1995 Annual Report. It summarizes the company's strong financial and operational performance in its first year after merging with Martin Marietta. Key points include record net earnings of $1.12 billion, excluding merger charges, and meeting over 96% of major program milestones. Lockheed Martin also captured over 60% of competitive bids pursued and maintained a $41 billion backlog. The report highlights the company positioning itself as a total systems provider across various sectors.
El Paso Corporation provides an overview of its business, which includes owning North America's largest natural gas pipeline system and being one of North America's largest independent natural gas producers. The document discusses the company's two business segments - Pipelines and Exploration & Production. For the Pipelines segment, it provides details on the company-owned and partner pipeline systems including miles of pipeline. For Exploration & Production, it outlines the company's acreage positions and proved natural gas reserves. It also discusses trends in the U.S. natural gas market and the infrastructure investment needed to meet growing demand.
El Paso Corporation provides an overview of its business, which includes owning North America's largest natural gas pipeline system and being one of North America's largest independent natural gas producers. The document discusses the company's two business segments - Pipelines and Exploration & Production. It provides key details on the pipeline and production assets, including miles of pipeline, gas transmission volumes, proven gas reserves, and acreage. It also discusses trends in the US natural gas market and the infrastructure investment needed to meet growing demand.
The consolidated net income of Petrobras and its subsidiaries for 2006 was R$25.919 billion, a 9% increase over 2005. This was mainly due to a R$4.076 billion increase in gross profit from higher sales volumes and oil prices in Brazil and abroad. However, this was partially offset by higher expenses including write-offs of abandoned wells abroad, increased sales and administrative expenses, taxes, research and development costs, and other operating costs.
Petrobras reported consolidated net income of R$ 25.9 billion in 2006, a 9% increase over 2005. Higher oil prices and sales volumes contributed to increased gross profits. Exploration costs decreased due to fewer dry wells. However, operating expenses also increased, driven by wages, taxes, and technological research costs. Overall, improved financial results and a tax benefit led to higher net income despite cost pressures. Income varied across business segments, with Exploration and Production up 8% and Supply up 10%, while Distribution was flat.
This document provides selected financial data for Mohawk Industries for the years 2002-1997. It includes income statement data such as net sales, costs, expenses, earnings, and earnings per share. It also includes balance sheet data such as working capital, assets, liabilities, and stockholders' equity. Key notes provide additional details on items in the financial statements such as restructuring costs, asset write-downs, legal settlements, and stock splits. The document also identifies two operating segments for Mohawk Industries following its acquisition of Dal-Tile in 2002 - the Mohawk segment and the Dal-Tile segment.
Petrobras reported consolidated net income of R$ 23.725 billion in 2005, similar to 2004. This was mainly due to increased oil and gas production, higher oil and fuel prices in local and foreign markets, and improved quality of oil products. However, selling and administrative expenses rose along with prospecting, pension, and other operating costs. Tax expenses declined due to changes in legislation. Overall, improved operations helped maintain income levels despite cost increases.
1) Interphase Corporation reported financial results for Q1 2009 with revenues of $8.4 million, a 13% increase over Q1 2008. Revenues increased 61% sequentially from Q4 2008.
2) The company reported a net income of $707,000 or $0.11 per share for Q1 2009 compared to a net loss in Q1 2008.
3) Interphase's balance sheet remains strong with $26.4 million in working capital including $17.4 million in cash and marketable securities as of March 31, 2009.
This document provides an overview of Duke Energy's 2004 annual report. It discusses Duke Energy's objectives for 2004 including generating cash, reducing debt, preserving dividends, resizing assets, improving safety, and restoring credibility. The chairman highlights accomplishments like exceeding financial targets, reducing debt, and stabilizing credit ratings. However, safety failures and an operational incident are noted as disappointments. Unfinished business is also mentioned, like developing a sustainable business model for Duke Energy North America. The chairman expresses optimism for 2005 while pursuing growth and leadership in the industry.
The Shaw Group is a leading provider of engineering, construction, environmental remediation, and facilities management services to government and private sector clients. In fiscal year 2003, the company increased revenues to $3.3 billion despite adverse market conditions. The document discusses Shaw's evolution into a more diversified organization with capabilities in areas such as power, process industries, environmental remediation, and infrastructure. It provides an overview of Shaw's financial performance, backlog composition, and strategies for future growth.
OGX reported positive second quarter 2010 results. Key highlights include:
- Commenced drilling of 8 new exploratory wells across three basins in Brazil.
- Filed environmental permits for production in the Campos Basin.
- Acquired 5 new exploratory blocks in Colombia.
- Reported a net profit of R$57.8 million for the quarter, compared to a net loss in the prior year, driven by lower financial expenses.
- Maintained a strong cash position of R$6.1 billion to fund ongoing exploration commitments.
This document summarizes the expected effects of the merger between Duke Energy and Cinergy. Shareholders and customers can expect value and reliable, affordable service. Local communities can anticipate support and enhancement. Employees will find a safe workplace that supports growth while sustaining the environment. The merger aims to increase value for investors while serving customers, communities, employees, and protecting the environment. Financial details of both companies from 2001-2005 are provided.
The document is Occidental Petroleum Corporation's 2006 Annual Report. It provides selected financial data and highlights of the company's results of operations, financial position, market capitalization, and cash flow for the years 2002-2006. It also briefly describes Occidental Petroleum as a leading oil and natural gas exploration and production company, as well as a major North American chemical manufacturer, with operations around the world.
- El Paso Corporation reported a net loss of $321 million for Q3 2005, impacted by $80 million in significant items including asset impairments and a contract termination.
- Regulated pipelines continue to perform solidly, while non-regulated businesses such as production, power, and field services faced challenges from hurricanes and commodity price volatility.
- Restoration of gas flows following hurricanes Katrina and Rita is progressing, but full recovery is not expected until year-end due to dependencies on third-party infrastructure and production.
- El Paso Corporation provides natural gas and related energy products. In Q3 2005 it reported a net loss of $321 million compared to a $214 million loss in Q3 2004.
- Significant items negatively impacting results included $162 million in asset impairments and a $28 million contract termination charge, partially offset by a $110 million gain on asset sales.
- Cash flow from operating activities was negative $398 million for the first nine months of 2005, compared to positive $799 million for the same period in 2004, largely due to working capital changes.
- Total debt increased to $17.9 billion as of September 30, 2005, up from $17.5 billion as of June 30,
Capital Product Partners Fourth Quarter 2008 Earningsearningsreport
Capital Product Partners L.P. reported strong fourth quarter 2008 results with net income of $14.3 million and operating surplus of $17.4 million. They announced a non-recurring exceptional cash distribution of $1.05 per unit, returning profit sharing revenues earned in 2008. Despite a weak shipping market outlook, the company has long-term contracts with reputable counterparties and adequate financial reserves to weather uncertain market conditions.
This document provides selected financial data for Mohawk Industries for the years 1999, 1998, 1997, 1996 and 1995 including statements of earnings data and balance sheet data. It shows that net sales increased each year from $2.04 billion in 1995 to $3.08 billion in 1999. Gross profit also increased each year, reaching $777 million in 1999. Total assets grew from $1.11 billion in 1995 to $1.68 billion in 1999.
This document summarizes selected financial data for Mohawk Industries from 1999 to 1995. It shows that net sales increased from $2.04 billion in 1995 to $3.08 billion in 1999, while net earnings increased from $11.8 million to $157.2 million over the same period. Total assets also increased substantially from $1.11 billion to $1.68 billion from 1995 to 1999. The document also provides notes on restructuring costs, asset write-downs, stock option expenses, and acquisition costs over the years.
Similar to lockheed martin 1998 Annual Report (20)
Intel reported a GAAP gross margin of 59.7% or $5,948 million for Q3 2005. Excluding a $140 million legal settlement charge related to an agreement with MicroUnity to resolve a patent case, Intel's gross margin was 61.1% or $6,088 million. The legal settlement charge impacted gross margin by 1.4% for the quarter.
- Intel reported first-quarter revenue of $8.9 billion, operating income of $1.7 billion, and earnings per share of 23 cents. Excluding share-based compensation, operating income was $2.1 billion and EPS was 27 cents.
- Revenue declined 5% year-over-year and 12% sequentially due to moderating PC growth rates leading to slower chip-level inventory reductions and affecting revenue.
- The outlook for the second quarter expects revenue between $8.0-8.6 billion and gross margin of 49%, plus or minus a couple points.
Intel reported third quarter revenue of $8.7 billion, a 12% decrease from the previous year. Operating income was $1.4 billion and earnings per share were 22 cents. Record shipments of mobile and server microprocessors drove results. Looking forward, Intel expects fourth quarter revenue between $9.1-9.7 billion and gross margin around 50%, and provided additional financial forecasts. Key risks include intense competition, transition to new manufacturing processes, and demand variability.
This document from Intel Corporation provides reconciliations of GAAP financial metrics to non-GAAP metrics that exclude the impact of share-based compensation. It shows adjustments made to spending, operating income, net income, earnings per share, common shares, and gross margin percentage for three months and a full year. These adjustments increase the non-GAAP numbers to exclude over $1 billion in share-based compensation expenses.
Intel reported fourth quarter revenue of $9.7 billion, operating income of $1.5 billion, and earnings per share of $0.26. For the full year 2006, Intel achieved revenue of $35.4 billion, operating income of $5.7 billion, net income of $5 billion and earnings per share of $0.86. Key highlights included record microprocessor and flash unit sales, and record mobile and server microprocessor revenue. For the first quarter of 2007, Intel expects revenue between $8.7-9.3 billion and earnings per share of approximately $0.30.
This document summarizes Intel's first-quarter 2007 financial results. Key points include:
- Revenue of $8.9 billion, operating income of $1.7 billion, net income of $1.6 billion, and EPS of 27 cents.
- Guidance for Q2 2007 includes expected revenue between $8.2-8.8 billion and gross margin of 48% plus/minus a couple points.
- Guidance for full year 2007 includes expected gross margin of 51% plus/minus a few points and R&D spending of $5.6 billion.
intel Second Quarter 2007 Earnings Releasefinance6
- Intel reported second-quarter revenue of $8.7 billion, up 8% year-over-year, with operating income of $1.35 billion and net income of $1.3 billion.
- For the third quarter, Intel expects revenue between $9.0-9.6 billion with a gross margin of 52% plus or minus a couple points.
- For 2007, Intel expects gross margin of 51% plus or minus a few points and capital spending of $4.9 billion plus or minus $200 million.
Intel has updated its third-quarter revenue and gross margin expectations. Revenue is now expected to be between $9.4 billion and $9.8 billion, compared to the previous range of $9.0 billion to $9.6 billion. Gross margin is expected to be in the upper half of the previous range of 52 percent plus or minus a couple points. All other expectations remain unchanged and Intel will report third-quarter financial results on October 16. The document outlines various risk factors that could affect Intel's actual results.
- Intel reported record third-quarter revenue of $10.1 billion, up 15% year-over-year. Operating income was $2.2 billion, up 64% year-over-year.
- Revenue growth was driven by record microprocessor, chipset, and flash unit shipments. Net income was $1.9 billion, up 43% year-over-year.
- For Q4 2007, Intel expects revenue between $10.5-11.1 billion and gross margin of 57% plus or minus a couple points.
Intel reported record quarterly revenue of $10.7 billion for Q4 2007, up 10.5% year-over-year. Net income was $2.3 billion, up 51% from Q4 2006. For the full year 2007, operating income grew 45% to $8.2 billion on revenue of $38.3 billion, an 8% increase. Looking ahead, Intel expects Q1 2008 revenue to be between $9.4-10 billion and gross margin of 56% plus or minus a couple points.
- Intel lowered its first-quarter gross margin forecast from 56% to 54% due to lower than expected prices for NAND flash memory chips.
- All other expectations for the first quarter remain unchanged from the previous business outlook published in Intel's fourth quarter earnings release.
- Intel will observe a "Quiet Period" from March 7 until its first-quarter earnings release where it will not update its business outlook.
- Intel reported record first quarter revenue of $9.7 billion, up 9% year-over-year, driven by strong demand for their microprocessors and chipsets.
- Net income was $1.4 billion, though this was down 12% year-over-year due to restructuring charges and a higher tax rate.
- For the second quarter, Intel expects revenue between $9.0-9.6 billion and gross margin of 56% plus or minus a couple points.
- Intel reported record first quarter revenue of $9.7 billion, up 9% year-over-year, driven by strong demand for their microprocessors and chipsets.
- Net income was $1.4 billion, though this was down 12% year-over-year due to restructuring charges.
- For the second quarter, Intel expects revenue between $9.0-9.6 billion and gross margin of 56% plus or minus a couple points.
intel Second Quarter 2008 Earnings Releasefinance6
Intel reported record second quarter revenue of $9.5 billion, up 9% year-over-year. Net income was $1.6 billion, a 25% increase from the previous year. Operating income grew 67% to $2.3 billion. Looking ahead, Intel expects third quarter revenue between $10-10.6 billion and gross margin around 58%.
- Intel reported record third quarter revenue of $10.2 billion, up 8% from the previous quarter. Operating income was $3.1 billion, up 37% from the previous quarter.
- Revenue growth was driven by higher microprocessor unit sales and prices. Gross margin increased to 59% due to lower unit costs and higher revenue.
- For Q4 2008, Intel expects revenue between $10.1-10.9 billion and gross margin around 59%. It also expects restructuring charges of $250 million and a net loss from investments of $50 million.
Intel announced that its fourth-quarter business will be below previous expectations, with revenue expected to be $9 billion, lower than the $10.1-10.9 billion expectation. Gross margin is also expected to be lower at 55% due to lower revenue and other charges from weaker demand. Spending is projected to be $2.8 billion compared to $2.9 billion expected previously. Risk factors that could further impact results include continued uncertainty in global economic conditions, competition, manufacturing costs and yields, and impairment charges.
This document summarizes Intel's fourth-quarter and annual financial results for 2008. Some key points:
- Fourth-quarter revenue was $8.2 billion, down 19% sequentially and 23% year-over-year.
- Annual revenue was $37.6 billion, down 2% year-over-year but up slightly adjusted for divestitures.
- Gross margin declined to 53% in Q4, down from 59% in Q3, due to higher factory underutilization and inventory write-offs.
- For 2009, Intel expects revenue to be around $7 billion in Q1 with gross margins in the low 40s, and spending of $10.4-10.6 billion
In 2007, Intel continued focusing on extending its product leadership and leveraging its manufacturing capabilities. Key highlights include:
- Revenue increased 8% to $38.3 billion and net income grew 38% to $7 billion.
- Intel launched 45nm processors designed for energy efficiency and transitioned its portfolio to the Intel Core microarchitecture.
- Demand remained strong across business segments for Intel's energy-efficient processors.
- The company renewed focus on its core strengths of Intel architecture and manufacturing leadership.
The document introduces Intel's new Core i7 processor. It claims the Core i7 is the fastest processor on the planet, up to 40% faster than the previous Core 2 Extreme processor. It is now available worldwide with broad support from OEMs and the industry. The Core i7 crosses a performance threshold and opens the door to new types of applications and usages.
This document contains forward-looking statements and risk factors for Intel's presentation on innovating the future of mobile computing. It notes uncertainties in global economic conditions could impact demand. It also cites competitive risks and challenges forecasting variable demand. The document states Intel's results could be impacted by the timing of acquisitions and divestitures, product introductions and demand, actions by competitors, ability to respond to technological changes, and supply availability.
In a tight labour market, job-seekers gain bargaining power and leverage it into greater job quality—at least, that’s the conventional wisdom.
Michael, LMIC Economist, presented findings that reveal a weakened relationship between labour market tightness and job quality indicators following the pandemic. Labour market tightness coincided with growth in real wages for only a portion of workers: those in low-wage jobs requiring little education. Several factors—including labour market composition, worker and employer behaviour, and labour market practices—have contributed to the absence of worker benefits. These will be investigated further in future work.
Optimizing Net Interest Margin (NIM) in the Financial Sector (With Examples).pdfshruti1menon2
NIM is calculated as the difference between interest income earned and interest expenses paid, divided by interest-earning assets.
Importance: NIM serves as a critical measure of a financial institution's profitability and operational efficiency. It reflects how effectively the institution is utilizing its interest-earning assets to generate income while managing interest costs.
University of North Carolina at Charlotte degree offer diploma Transcripttscdzuip
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Fabular Frames and the Four Ratio ProblemMajid Iqbal
Digital, interactive art showing the struggle of a society in providing for its present population while also saving planetary resources for future generations. Spread across several frames, the art is actually the rendering of real and speculative data. The stereographic projections change shape in response to prompts and provocations. Visitors interact with the model through speculative statements about how to increase savings across communities, regions, ecosystems and environments. Their fabulations combined with random noise, i.e. factors beyond control, have a dramatic effect on the societal transition. Things get better. Things get worse. The aim is to give visitors a new grasp and feel of the ongoing struggles in democracies around the world.
Stunning art in the small multiples format brings out the spatiotemporal nature of societal transitions, against backdrop issues such as energy, housing, waste, farmland and forest. In each frame we see hopeful and frightful interplays between spending and saving. Problems emerge when one of the two parts of the existential anaglyph rapidly shrinks like Arctic ice, as factors cross thresholds. Ecological wealth and intergenerational equity areFour at stake. Not enough spending could mean economic stress, social unrest and political conflict. Not enough saving and there will be climate breakdown and ‘bankruptcy’. So where does speculative design start and the gambling and betting end? Behind each fabular frame is a four ratio problem. Each ratio reflects the level of sacrifice and self-restraint a society is willing to accept, against promises of prosperity and freedom. Some values seem to stabilise a frame while others cause collapse. Get the ratios right and we can have it all. Get them wrong and things get more desperate.
Independent Study - College of Wooster Research (2023-2024) FDI, Culture, Glo...AntoniaOwensDetwiler
"Does Foreign Direct Investment Negatively Affect Preservation of Culture in the Global South? Case Studies in Thailand and Cambodia."
Do elements of globalization, such as Foreign Direct Investment (FDI), negatively affect the ability of countries in the Global South to preserve their culture? This research aims to answer this question by employing a cross-sectional comparative case study analysis utilizing methods of difference. Thailand and Cambodia are compared as they are in the same region and have a similar culture. The metric of difference between Thailand and Cambodia is their ability to preserve their culture. This ability is operationalized by their respective attitudes towards FDI; Thailand imposes stringent regulations and limitations on FDI while Cambodia does not hesitate to accept most FDI and imposes fewer limitations. The evidence from this study suggests that FDI from globally influential countries with high gross domestic products (GDPs) (e.g. China, U.S.) challenges the ability of countries with lower GDPs (e.g. Cambodia) to protect their culture. Furthermore, the ability, or lack thereof, of the receiving countries to protect their culture is amplified by the existence and implementation of restrictive FDI policies imposed by their governments.
My study abroad in Bali, Indonesia, inspired this research topic as I noticed how globalization is changing the culture of its people. I learned their language and way of life which helped me understand the beauty and importance of cultural preservation. I believe we could all benefit from learning new perspectives as they could help us ideate solutions to contemporary issues and empathize with others.
1. Elemental Economics - Introduction to mining.pdfNeal Brewster
After this first you should: Understand the nature of mining; have an awareness of the industry’s boundaries, corporate structure and size; appreciation the complex motivations and objectives of the industries’ various participants; know how mineral reserves are defined and estimated, and how they evolve over time.
Abhay Bhutada, the Managing Director of Poonawalla Fincorp Limited, is an accomplished leader with over 15 years of experience in commercial and retail lending. A Qualified Chartered Accountant, he has been pivotal in leveraging technology to enhance financial services. Starting his career at Bank of India, he later founded TAB Capital Limited and co-founded Poonawalla Finance Private Limited, emphasizing digital lending. Under his leadership, Poonawalla Fincorp achieved a 'AAA' credit rating, integrating acquisitions and emphasizing corporate governance. Actively involved in industry forums and CSR initiatives, Abhay has been recognized with awards like "Young Entrepreneur of India 2017" and "40 under 40 Most Influential Leader for 2020-21." Personally, he values mindfulness, enjoys gardening, yoga, and sees every day as an opportunity for growth and improvement.
The Universal Account Number (UAN) by EPFO centralizes multiple PF accounts, simplifying management for Indian employees. It streamlines PF transfers, withdrawals, and KYC updates, providing transparency and reducing employer dependency. Despite challenges like digital literacy and internet access, UAN is vital for financial empowerment and efficient provident fund management in today's digital age.
2. Elemental Economics - Mineral demand.pdfNeal Brewster
After this second you should be able to: Explain the main determinants of demand for any mineral product, and their relative importance; recognise and explain how demand for any product is likely to change with economic activity; recognise and explain the roles of technology and relative prices in influencing demand; be able to explain the differences between the rates of growth of demand for different products.
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May’s reports showed signs of continued economic growth, said Sam Millette, director, fixed income, in his latest Economic Risk Factor Update.
For more market updates, subscribe to The Independent Market Observer at https://blog.commonwealth.com/independent-market-observer.
[4:55 p.m.] Bryan Oates
OJPs are becoming a critical resource for policy-makers and researchers who study the labour market. LMIC continues to work with Vicinity Jobs’ data on OJPs, which can be explored in our Canadian Job Trends Dashboard. Valuable insights have been gained through our analysis of OJP data, including LMIC research lead
Suzanne Spiteri’s recent report on improving the quality and accessibility of job postings to reduce employment barriers for neurodivergent people.
Decoding job postings: Improving accessibility for neurodivergent job seekers
Improving the quality and accessibility of job postings is one way to reduce employment barriers for neurodivergent people.
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1. 1 9 9 8 A N N U A L R E P O R T
LOCKHEED MARTIN
2. FINANCIAL HIGHLIGHTS
1997(b) 1996(b)(c)
1998
(In millions, except per share data and number of employees)
Net sales $26,266 $28,069 $26,875
(a) (e)
1,347(f )
Net earnings 1,001 1,300
2.63(a) (1.56)(d) (e) 3.04(f )
Diluted earnings (loss) per share
Pro forma diluted earnings per share excluding
3.11(g) 3.02(g) 2.72(g)
nonrecurring and unusual items
Cash dividends per common share .82 .80 .80
Net cash provided by operating activities 2,031 1,208 1,636
Expenditures for property, plant and equipment 697 750 737
Total assets 28,744 28,361 29,540
Short-term borrowings 1,043 494 1,110
Long-term debt (including current maturities) 9,843 11,404 10,368
(d)
Stockholders’ equity 6,137 5,176 6,856
Negotiated backlog $45,345 $47,059 $50,406
Employees 165,000 173,000 190,000
(a) Earnings for 1998 include the effects of a nonrecurring and unusual charge related to CalComp Technology,
Inc. (CalComp), a majority-owned subsidiary of the Corporation. In 1998, the Corporation decided that
it would not increase existing credit for CalComp to support ongoing operations, and agreed to provide
financing, subject to certain conditions, for a plan providing for the timely non-bankruptcy shutdown of
CalComp’s business. These actions resulted in a charge related to the impairment of assets and estimated
costs required to accomplish the shutdown of CalComp’s operations. This charge decreased net earnings
by $183 million, or $.48 per diluted share.
(b) Amounts per common share have been restated to reflect the two-for-one common stock split distributed to
stockholders in December 1998.
(c) Reflects the business combination with Loral Corporation since April 1996.
(d) Loss per share for 1997 includes the effects of a deemed preferred stock dividend resulting from a transaction
with General Electric Company (GE). The excess of the fair value of the consideration transferred to GE
(approximately $2.8 billion) over the carrying value of the Series A preferred stock ($1.0 billion) was treated
as a deemed preferred stock dividend and deducted from 1997 net earnings in determining net loss applicable
to common stock used in the computation of loss per share. The effect of this deemed dividend was to reduce
the diluted per share amount by $4.93.
(e) Earnings for 1997 include the effects of a tax-free gain of $311 million related to the transaction with GE
to redeem the Corporation’s Series A preferred stock, and nonrecurring and unusual charges related to the
Corporation’s decision to exit certain lines of business and related to impairment in the values of various
non-core investments and certain other assets, which decreased net earnings by $303 million. On a combined
basis, these items decreased diluted loss per share by $.02.
(f) Earnings for 1996 include the effects of a nonrecurring gain resulting from divestitures which increased net
earnings by $351 million. The gain was substantially offset by nonrecurring charges related to the Corporation’s
environmental remediation business, and related to impairment in the values of certain investments and other
assets, and costs for facility closings and transfers of programs, which decreased net earnings by $209 million.
On a combined basis, these items increased diluted earnings per share by $.32.
(g) The calculation of pro forma diluted earnings per share exclude the effects of the nonrecurring and unusual
items described above and, for 1997, include the pro forma dilutive effects of preferred stock conversion and
stock options.
On the Cover:
This unusual perspective of a Joint Strike Fighter inlet model was captured at the Skunk Works’ radar
test range at Helendale, California, where Lockheed Martin tests the limits of stealth technology.
Leadership in stealth and other cutting-edge technologies is a key ingredient in our Mission Success.
3. 1
O U R V I S I O N
For Lockheed Martin to be the world’s leading technology and
systems enterprise, providing best value to our customers, growth opportunities
to our employees and superior returns to our shareholders.
Contents
To Our Shareholders 2
1998 Achievements 4
Mission Success 6
Innovation 8
Synergy 10
Growth 12
Financial Section 14
Corporate Directory 48
General Information 50
4. 2
C O M M I T M E N T T O
PERFORMANCE
Dear Fellow Shareholder: Consolidated Space
Lockheed Martin has Operations Contract that
now been in existence for calls for consolidating 17
only four years. But one of NASA contracts, as well
the real strengths of our as the Joint Air-to-Surface
Corporation is that we can Standoff Missile contract
trace our roots back to the to build an advanced cruise
earliest days of aviation missile for the U.S. Air
pioneers. Today, we are a Force and Navy.
strong, well-balanced aero- However, the year
space, defense and informa- was punctuated by some
tion technology corporation disappointments. We contin-
positioned to achieve consistent, profitable growth. ued to experience problems with the Theater High
We derive our strength from an ability to leverage Altitude Area Defense (THAAD) missile, and also
our most valuable assets—our people, our tech- experienced a Titan IV launch failure. In addition,
nology and our diversity. we did not achieve our earnings goals due to per-
Last year, we achieved a 97 percent level of formance issues in our space and commercial
Mission Success on about 900 measurable events. information products businesses, as well as delays
In addition, we earned an impressive 94 percent of commercial space launches and military aircraft
of all possible award fees from our customers, deliveries during the year. Sales increased only
won more than half our competitive business one percent, normalized for divestitures, and
opportunities, produced $1.6 billion of free cash earnings per share, adjusted for nonrecurring and
flow, reduced total debt by more than $1 billion, unusual items, grew three percent from $3.02 to
increased the annual dividend rate by 10 percent, $3.11. Consequently, our share price significantly
and divested several non-core businesses. underperformed the market. In order to improve
We can point proudly to several program results in 1999 and beyond, we have redoubled
milestones in 1998 that included successfully our commitment to strong performance, manage-
executing an ambitious F-22 flight schedule ment accountability and additional productivity
and launching the Space Shuttle Super increases. We also have made management
Lightweight Tank. We used the synergy of changes where appropriate.
multiple Lockheed Martin companies teamed Our goal continues to be the increase of
together to win such critical competitions as the shareholder value and we have established the
Above right: Vance D. Coffman, Chairman and Chief Executive Officer
Above left: Peter B. Teets, President and Chief Operating Officer
5. 3
following financial targets to achieve that goal: In 1998, we formed Lockheed Martin Global
generate robust cash flow, improve profit margins Telecommunications (LMGT) to properly position
and competitiveness, and produce sustainable the Corporation in the rapidly expanding global
earnings per share growth. We intend to use the marketplace for telecommunications services.
cash to pay down debt, maintain technology lead- Leveraging the Corporation’s expertise in space-
ership, and invest in profitable growth that will and-terrestrial-based telecommunications and
produce returns above the cost of capital. We will systems integration, our vision for LMGT is to
drive our formal Value Based Management program provide seamless telecommunications services to
deep into the management organization to reflect large organizations, including multinational corpo-
our focus on total shareholder return. rations and governments. The planned combination
In 1998, we started a Corporate-wide initiative with COMSAT perfectly augments our strategy.
called LM21—Best Practices, aimed at involving In 1999, as in past years, we have set the
thousands of our talented employees in a concerted bar high, rolling up our sleeves to perfect what
effort to leverage the best of our diverse backgrounds we do well, and making corrections where
and experiences in order to streamline operations. we have not measured up. The fabric of our
We are striving to improve engineering practices, Corporate Purpose and Values—Mission Success,
and to reduce procurement costs while building Customer Focus, Ethics, Excellence, “Can-Do”
a strong supplier base. We are benchmarking Spirit, Integrity, People and Teamwork—has
hundreds of practices in use throughout Lockheed been woven into our daily business lives.
Martin, identifying the best and then sharing these Before we close, we would like to acknowl-
Best Practices across the entire Corporation. edge the contributions of Norman R. Augustine
The results to date have been encouraging. who retired as Chairman last April, and Marcus C.
Numerous high-payoff Best Practices already have Bennett who retired in January as CFO. We owe
been transferred among multiple companies within our deepest appreciation to both.
Lockheed Martin. Best Practice Transfer Teams Our strong belief is that Lockheed Martin can
have been established involving people from through- deliver a positive future to all our stakeholders.
out the Corporation. And, performance improvement To be sure, we have some challenges ahead in
metrics currently in place are starting to show results. 1999 and beyond. But in facing them, we must
In addition, our Best Practices initiative is energiz- remember that solving problems—some of the
ing our people to think creatively and look beyond world’s biggest problems—is the very nature of
traditional organizational boundaries to find the best our business. We’re good at it. And, thanks to the
solutions. It is our belief that we are positioned to 165,000 talented and dedicated people who walk
see performance improvements in 1999 as the through Lockheed Martin’s doors each working
Best Practices initiative takes hold at all levels of day, we have full confidence in our Corporation’s
the Corporation. Once it is fully implemented over future prosperity. We look forward to continuing
the next four years, we expect Best Practices to save to work together to achieve Mission Success in
the Corporation $2.5 billion to $3 billion a year. all of our endeavors.
We are proud of the role we play in providing
February 22, 1999
quality products and services to the core markets
we serve—Defense, Space, and Civil Government
Information Systems and Services. Our vision for Vance D. Coffman
Chairman and Chief Executive Officer
the future is to continue to nurture and grow our
core businesses while we expand rapidly into the
closely related Global Telecommunications and
Peter B. Teets
Information Services markets.
President and Chief Operating Officer
6. 1 9 9 8 A C H I E V E M E N T S
SPACE & STRATEGIC MISSILES SECTOR
x Lockheed Martin successfully launched six Atlas, two Titan, one Athena and three Russian Proton vehicles. x U.S. Air Force
awarded Lockheed Martin contracts for development completion of the Evolved Expendable Launch Vehicle family of launchers as well
as launch services for nine missions. x Lockheed Martin built the External Tanks, including three Super Lightweight Tanks, for five
successful Space Shuttle launches. x Achieved 100 percent Mission Success on five Space Shuttle missions launched by the United
Space Alliance joint venture. x Michoud Space Systems delivered major hardware components for the X-33 in support of the
VentureStar Reusable Launch Vehicle. x Lockheed Martin successfully manufactured and deployed one military, five civil and
43 commercial satellites/payloads, including 39 buses for the Iridium global telecommunications system.
MISSION SUCCESS: ATTAINING TOTAL CUSTOMER SATISFACTION
ELECTRONICS SECTOR
x Lockheed Martin received a U.S. Navy contract to produce 13 AEGIS weapon systems through 2007. x Selected to upgrade
six Royal Australian Navy frigates, and to deploy four Tactical Air Defense Radar Systems for the Australian Defence Force. x Under
contract to deliver Low-Altitude Navigation and Targeting Infrared System for Night (LANTIRN) and Sharpshooter targeting systems for
F-16’s in the air forces of Egypt, Taiwan, and Denmark. x Developing the Low-Cost Autonomous Attack System (LOCAAS), a smart
munition deployable from air-, land- or sea-based platforms for use against mobile or fixed targets. x Lockheed Martin is developing
a Guided Multiple Launch Rocket System for the United States, the United Kingdom, Germany, France and Italy. x Lockheed Martin
will deliver 290 additional Army Tactical Missile System (ATACMS) missiles, and will develop and field the Line-of-Sight Antitank
(LOSAT) weapon system. x Air Sovereignty Operations Centers became operational in Poland, Hungary and the Czech Republic,
giving these nations an integrated view of their airspace and permitting cross-border sharing of airspace information.
AERONAUTICS SECTOR
x The United Arab Emirates announced selection of Block 60 F-16 in an 80-aircraft program potentially valued at $5 billion.
x C-130J—received FAA certification and delivered 19 aircraft, completed successful world tour to 32 countries, flew 380 guest
pilots, generated 28 proposals. x F-22—received $525 million in funding for two Production Readiness Test Vehicles and $189
million long-lead funding for first low-rate production lot following accomplishment of 183 flight hours and a variety of specific flight
test points. x Joint Strike Fighter—achieved successful Final Design Review 2,000 pounds below target aircraft weight, assembly
of first X-35 concept demonstrator 25 percent complete. x X-33 Reusable Launch Vehicle—completed launch site, fabrication of
vehicle is between 67 and 69 percent complete. x Lockheed Martin received $1 billion, eight-year contractor logistics support
contract from USAF for F-1 Total System Performance Responsibility.
17
INFORMATION & SERVICES SECTOR
x NASA selected Lockheed Martin team to consolidate mission and data services at five of the space agency’s major centers
as part of its Consolidated Space Operations Contract. x The U.S. Army Communications & Electronics Command awarded
Lockheed Martin a contract to provide logistics support in the Rapid Response to Critical Requirements Support program.
x The Immigration and Naturalization Service (INS) selected Lockheed Martin to build, develop and manage advanced informa-
tion systems in support of critical INS missions. x Lockheed Martin formed strategic alliance with Policy Management Systems
Corporation to pursue information technology and business process outsourcing opportunities in the insurance industry. As part of
the alliance, Lockheed Martin assumes responsibility for PMSC’s North American data center. x The U.S. Strategic Command
selected Lockheed Martin to modernize its computer system infrastructure at Offutt Air Force Base, Nebraska. x Lockheed Martin
was selected to provide complete software life-cycle support to the Social Security Administration.
THE PURSUIT OF SUPERIOR PERFORMANCE INFUSES EVERY LOCKHEED MARTIN ACTIVITY
ENERGY & ENVIRONMENT SECTOR
x The Department of Energy extended Lockheed Martin’s contract to manage Sandia National Laboratories for five years. The
new contract runs through September 30, 2003. x The Department of Energy approved a 15-month extension for Lockheed Martin
to operate the Energy Systems facility at Oak Ridge. The new contract runs through June 30, 2001. x Lockheed Martin Hanford
Corporation and its Tank Waste Remediation System team passed one million work hours without recording a lost workday case.
x Lockheed Martin Energy Systems at the Y-12 Plant received Department of Energy authorization to resume production operations
with enriched uranium on June 8. An enriched uranium casting was made, the first since shutdown of operations in 1994. x Sandia’s
Protonic Non-Volatile Memory Chip won a 1998 Discover Award from Discover Magazine.
7. 5
x Space Communications Corporation and Japan Satellite Systems selected Lockheed Martin to
build a telecommunications satellite to provide coverage for Japan and the region. x Lockheed
Martin supported NASA’s Lunar Prospector, Transition Region and Coronal Explorer solar telescope,
Mars Global Surveyor, Hubble Space Telescope and Mars Surveyor ’98 missions. x Lockheed
Martin delivered the first of eight solar array flight wings that will power the International Space
Station. x Lockheed Martin successfully conducted eight Fleet Ballistic Missile flights.
Evolved Expendable Launch Vehicle
Left:
x Lockheed Martin selected to develop and build the Joint Air-to-Surface Standoff Missile
(JASSM) for the U.S. Air Force and Navy. x Completed systems integration to provide
submarine-launched cruise missile capability to the Royal Navy’s Swiftsure- and Trafalger-class
submarines, and to support the Royal Navy’s formation of its first squadron of Merlin helicopters.
x Lockheed Martin expanded its position in the high-growth postal systems business and
acquired Postal Technologies, Inc., which manufactures and markets high-speed document
processing systems, barcode readers and sorters. x Buses equipped with Lockheed Martin’s
HybriDrive propulsion system entered revenue service in New York City.
AEGIS
Right:
MISSION SUCCESS: MEETING ALL OUR COMMITMENTS
x GAMECO—announced plans to expand this commercial aircraft maintenance joint venture
with China Southern Airlines to accommodate increased business. x KTX-2 trainer and combat
aircraft—Lockheed Martin signed joint market development agreement with Samsung of Republic of
Korea. x A-4AR—delivered three modified aircraft to the Argentinean Air Force. x Supersonic
Business Jet announced plans to team with Gulfstream on a technical, environmental and regulatory
feasibility study.
F-22
Left:
x Lockheed Martin Management & Data Systems achieved a Software Engineering Institute Level
4 rating. As of March 1999, five Lockheed Martin Companies are at Level 4, and two at Level 5,
the highest for software engineering maturity. x Lockheed Martin’s rapidly growing welfare reform
line of business won more than 20 contracts across the country to provide welfare-to-work services.
x The Air Traffic Management Bureau of East China awarded Lockheed Martin a contract for
the installation of air traffic control systems at Hongqiao International Airport and Pudong International
Airport in Shanghai. x Completion of the initial operational test and evaluation resulted in Lockheed
Martin’s rollout of its first production-line Close Combat Tactical Trainer simulator system for the
U.S. Army, the first of 54 units under a limited-rate, initial-production contract.
Commercial IT
Right:
x Sandia won the Department of Energy’s “M&O Contractor of the Year Award” for its
performance in contracting with small, women-owned, minority, and 8(a) businesses. x The
three national labs won a total of eight “R&D 100 Awards.” x After five years since its incep-
tion, Technology Ventures Corporation has facilitated the formation of 32 new technology-based
businesses, created over 1,270 jobs in New Mexico, and secured over $133 million in funding
for its client companies. x The Analytical Services and Protective Services organizations at the
Lockheed Martin Energy Systems Y-12 facility at Oak Ridge, Tennessee, earned the Department
of Energy’s highest award for quality.
Architectural Surety
Left:
8. 6
L E A D E R S H I P T H R O U G H
MISSION SUCCESS MISSION SUCCESS IS OUR COMMITMENT
TO TOTAL CUSTOMER SATISFACTION.
Over the past four an ambitious F-22
years, we at Lockheed flight test schedule,
Martin have measured our and launching the
performance by Mission Space Shuttle Super
Success. The shorthand Lightweight Tank. Not
definition of Mission all Mission Success
Success is simple— events are related to
attaining total customer things that fly. As a
satisfaction and meeting Mission Success, we
all our commitments. recognize deliveries,
Mission Success also qualification tests or
is the standard by which sea trials of multiple
we measure the performance of every aircraft AEGIS shipboard weapon systems. In addi-
we fly, every spacecraft we launch, every tion, five of our companies are at a Software
system we integrate, every service we provide. Engineering Institute (SEI) Level 4 rating,
In essence, when our products and services and two of our companies have achieved
work as promised to the customer, we have Level 5, placing them among a select group
earned the right to call it Mission Success. of companies to attain this high level of soft-
Last year, Lockheed Martin achieved a ware engineering expertise.
97 percent Mission Success record based At Lockheed Martin, Mission Success
on approximately 900 measurable events. is a way of thinking strategically as well as
In 1998, some of our Mission Success doing business on a day-to-day basis with
highlights included successfully executing a disciplined focus on the customer.
It was Mission Success for five Space Shuttle missions launched by our United Space Alliance
Above:
joint venture last year. Lockheed Martin also builds the Shuttle’s External Tank.
Lockheed Martin is producing the Close Combat Tactical Trainer simulator system for the U.S. Army.
Right:
With this system soldiers can train in real time on a highly interactive virtual battlefield.
9.
10. 8
E X C E L L E N C E T H R O U G H
INNOVATION WE HAVE IDENTIFIED 14 STRATEGIC TECHNOLOGIES
THAT ARE CRITICAL TO THE CORPORATION’S FUTURE.
Simply stated, inno- leveraging them. These
vation drives growth, and are enabling technologies
for Lockheed Martin that that Lockheed Martin
means a passionate com- needs to be successful
mitment to research, in high-growth, closely
technology leadership related fields such as
and more efficient busi- information services
ness practices. We can- and space-based
not compete effectively telecommunications.
by using yesterday’s Our commitment
processes, nor by to innovation extends to
operating according to the way we do business
yesterday’s template. Our attention is focused through LM21 Best Practices. This is part
on investing in processes that will help us be of an overarching desire to work smarter
more competitive. and share those ideas throughout Lockheed
To that end, we have 60,000 of the Martin to be a more competitive player in
world’s premier scientists and engineers. the marketplace.
Plus we have a $1 billion discretionary Additionally, our Virtual Product
budget available for independent research, Development Initiative is revolutionizing
as well as bid and proposal to develop the the aircraft development process. Through
promising technologies for tomorrow. advanced computer-aided design technology,
We have identified 14 strategic tech- we have created a Virtual Company that
nologies that are critical to the Corporation’s unites geographically dispersed people and
future, and we are developing a process for significantly reduces cycle time and costs.
Lockheed Martin uses its expertise in Commercial IT in advanced medical records databases.
Above:
Lockheed Martin’s VentureStar will advance the science and technology of space transportation
Right:
as well as reduce the cost of getting into space.
11.
12. 10
MULTIPLYING TALENTS BY
SYNERGY THROUGH TEAMWORK WE CAN BEST HARNESS
THE DIVERSE TALENTS OF OUR 165,000 EMPLOYEES.
The successful organizations in our responsiveness across all product and organi-
marketplaces will be the ones that build zational lines.
world-class teams. Lockheed Martin is Teamwork is not limited to the excellent
mobilizing its people, technologies and job we have been doing internally among
resources, focusing these on common goals our diverse set of business units that make
and objectives. It is that kind of focus that up today’s Lockheed Martin. In the domestic
has enabled us to win and retain key pro- market, we are the partner of choice for a
grams that would not have been possible variety of commercial companies and govern-
without the synergies inherent in this high- ment agencies–from federal, to county
technology enterprise. and municipal governments. Internationally,
Through teamwork we can best harness we have established alliances, joint ventures
the diverse talents of our 165,000 employees and other partnerships with companies and
to create a culture that stresses positive governmental bodies in almost 50 countries.
thinking, a “can-do” attitude and customer Our commitment to teamwork was
recognized industrywide in 1998 with the
American Business Ethics Award from the
American Society of Chartered Life Under-
writers & Chartered Financial Consultants,
as well as Industry Week’s selection of our
Tactical Aircraft Systems plant in Fort Worth
as one of the country’s 10 best plants. In
addition, Graduating Engineer magazine
readers rank Lockheed Martin as the top
company to join. All this makes us the
employer of choice–attracting the best
and the brightest to our doors.
The Consolidated Space Operations Contract (CSOC) calls for the consolidation of 17 NASA
Above:
contracts, and further cements Lockheed Martin’s relationship with its NASA customer.
The Joint Air-to-Surface Standoff Missile (JASSM) is an example of teamwork and partnerships,
Right:
uniting diverse talents and capabilities throughout Lockheed Martin.
13.
14. 12
12
OPPORTUNITIES FOR
GROWTH
IN 1998, WE FORMED LOCKHEED MARTIN GLOBAL TELECOMMUNICATIONS
TO PROVIDE COST-EFFECTIVE TELECOMMUNICATIONS SERVICES TO CORPORATE
AND GOVERNMENT CUSTOMERS.
While Lockheed Integrator. Our Systems
Martin remains a world- Integration expertise
class aerospace company, has been absolutely
we are committed to vital to our ability
a strategy that rewards to win–and hold–
agility–strength with new business.
speed. Part of that Also, we formed
agility is taking advan- Lockheed Martin Global
tage of high-growth Telecommunications, a
opportunities that can wholly-owned subsidiary
enhance shareholder to provide cost-effective
value and accelerate telecommunications
Lockheed Martin’s momentum as a globally services to corporate and government cus-
oriented advanced technology company. tomers. There are major growth opportunities
Our defense business is strongly posi- in worldwide space-based and terrestrial tele-
tioned to build market share. And we intend to communications markets and we are confi-
grow high-return, adjacent lines of businesses. dent that we can leverage our extensive
Three such opportunity-rich markets are telecommunications capabilities to exploit
in Information Technology, Systems Integration, those opportunities.
and Telecommunications Services, where In September, Lockheed Martin
Lockheed Martin is committed to achieving announced a proposed $2.7 billion strategic
leadership positions. In 1998, Washington combination with COMSAT Corporation
Technology named Lockheed Martin as that would unite two advanced-technology
number one of the top Federal IT providers, companies with complementary global
and we are the leading Federal Systems telecommunications capabilities.
With such advanced technology as the Intelligent Network Management System, Lockheed Martin is
Above:
pursuing new opportunities in worldwide satellite telecommunications.
The Multi-Line Optical Character Reader/Video Coding System is indicative of innovations
Right:
in automation for our postal customers worldwide.
15.
16. 14
FINANCIAL SECTION
Management’s Discussion and Analysis of
15
Financial Condition and Results of Operations
The Corporation’s Responsibility for Financial Reporting
26
Report of Ernst & Young LLP, Independent Auditors
27
Consolidated Statement of Earnings
28
Consolidated Statement of Cash Flows
29
Consolidated Balance Sheet
30
Consolidated Statement of Stockholders’ Equity
31
Notes to Consolidated Financial Statements
32
Consolidated Financial Data—Nine Year Summary
46
17. 15
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION Lockheed Martin Corporation
AND RESULTS OF OPERATIONS
December 31, 1998
Lockheed Martin Corporation (Lockheed Martin or the Corporation) with respect to the Tender Offer, and if Congress does not make
is engaged in the conception, research, design, development, manu- rapid progress on satellite industry reform legislation, the Tender
facture, integration and operation of advanced technology systems, Offer may not be consummated by September 18, 1999. If this occurs,
products and services. The Corporation serves customers in both either party may terminate the Merger Agreement or both parties may
domestic and international defense and commercial markets, with elect to amend the Merger Agreement to extend this date. If the FCC’s
its principal customers being agencies of the U.S. Government. The review is not delayed or slowed and the Tender Offer is consummated,
following discussion should be read in conjunction with the audited but the legislative process relative to satellite industry reform legisla-
consolidated financial statements included herein. tion moves slowly, the Merger is unlikely to occur in 1999.
Common Stock Split Acquisitions and Divestitures
In October 1998, the Board of Directors of the Corporation autho- In November 1997, Lockheed Martin exchanged all of the out-
rized a two-for-one split of the Corporation’s common stock in standing capital stock of a wholly-owned subsidiary for all of the
the form of a stock dividend which was effected on December 31, outstanding Series A preferred stock held by General Electric
1998. In the following discussion, all references to shares of com- Company (GE) and certain subsidiaries of GE (the GE Transaction).
mon stock and per share amounts have been restated to reflect the The Series A preferred stock was convertible into approximately 58
stock split. million shares of Lockheed Martin common stock. The Lockheed
Martin subsidiary was composed of two non-core commercial busi-
Transaction Agreement with COMSAT Corporation
ness units which contributed approximately five percent of the
In September 1998, the Corporation and COMSAT Corporation
Corporation’s 1997 net sales, Lockheed Martin’s investment in a
(COMSAT) announced that they had entered into an agreement
telecommunications partnership and approximately $1.6 billion
to combine the companies in a two-phase transaction with a total
in cash. The GE Transaction was accounted for at fair value, and
estimated value of approximately $2.7 billion at the date of the
resulted in the reduction of the Corporation’s stockholders’ equity
announcement (the Merger). In connection with the first phase of this
by $2.8 billion and the recognition of a tax-free gain of approxi-
transaction, the Corporation commenced a cash tender offer (the Tender
mately $311 million in other income and expenses. Also see the
Offer) to purchase up to 49 percent, subject to certain adjustments,
discussion under the caption “Results of Operations” regarding
of the outstanding shares of common stock of COMSAT on the date
the impact of the GE Transaction on the computation of 1997
of purchase at a price of $45.50 per share, with an estimated value
earnings per share. In 1998 and 1997, in connection with the GE
of $1.2 billion. Under the Merger agreement, the Tender Offer will
Transaction, the Corporation issued notes to a wholly-owned sub-
be extended for periods of up to 60 days until the earlier of (i)
sidiary of GE for $210 million, bearing interest at 5.73%, and
September 18, 1999, or (ii) satisfaction of certain conditions to closing.
$1.4 billion, bearing interest at 6.04%, respectively. The notes are
The consummation of the Tender Offer is subject to, among other
due November 17, 2002.
things, the approval of the Merger by the stockholders of COMSAT
In July 1997, the Corporation and Northrop Grumman Corpora-
and certain regulatory approvals, including approval by the Federal
tion (Northrop Grumman) announced that they had entered into an
Communications Commission (FCC). The stockholders of COMSAT
agreement to combine the companies whereby Northrop Grumman
are expected to vote on the proposed Merger at COMSAT’s annual
would become a wholly-owned subsidiary of Lockheed Martin. The
meeting of stockholders on June 18, 1999. Upon completion of this
proposed merger with Northrop Grumman was terminated by the
phase of the transaction, the Corporation will account for its invest-
Board of Directors of Lockheed Martin in July 1998.
ment in COMSAT under the equity method of accounting. The sec-
In March 1997, the Corporation executed a definitive agreement
ond phase of the transaction, which will result in consummation of
valued at approximately $525 million to reposition ten non-core
the Merger, will be accomplished by an exchange of one share of
business units as a new independent company, L-3 Communications
Lockheed Martin common stock for each share of COMSAT com-
Corporation (L-3), in which the Corporation retained an approxi-
mon stock. Consummation of the Merger is subject to, among other
mate 35 percent ownership interest at closing. These business units
things, the enactment of legislation necessary to allow Lockheed
contributed approximately two percent of the Corporation’s net
Martin to acquire the remaining shares of COMSAT common stock
sales during the three month period ended March 31, 1997. The
and certain additional regulatory approvals, including anti-trust clear-
transaction, which closed in April 1997 with an effective date of
ance by the Department of Justice. The Merger will be accounted for
March 30, 1997, did not have a material impact on the Corpora-
under the purchase method of accounting.
tion’s earnings. The Corporation’s ownership percentage was
The Corporation is not currently designated by the FCC as an
reduced to approximately 25 percent in the second quarter of 1998
“authorized common carrier,” and as such is prohibited from owning
as a result of an initial public offering of L-3’s common stock. In
more than 10 percent of COMSAT. The Corporation has filed an
the first quarter of 1999, the Corporation’s ownership percentage
application with the FCC to be designated an “authorized common
was further reduced to approximately 7 percent as a result of a sec-
carrier” and to purchase up to 49 percent of COMSAT. On January
ondary offering of L-3’s common stock which included 4.5 million
21, 1999, the Chairman of the House Committee on Commerce and
shares previously owned by the Corporation. The 1998 transaction
the Chairman of the Senate Subcommittee on Communications sent
increased net earnings by $12 million, and the 1999 transaction is
a letter to the FCC urging the FCC not to take any action to permit
estimated to increase first quarter 1999 net earnings by an amount
any company to purchase more than 10 percent of COMSAT prior
between $75 million and $85 million.
to Congress adopting satellite industry reform legislation. If the
FCC were to delay or slow its review of the Corporation’s filings
18. 16
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS (Continued)
December 31, 1998
During the third quarter of 1996, the Corporation announced Results of Operations
its intention to distribute via an exchange offer its interest in The Corporation’s operating cycle is long-term and involves many
Martin Marietta Materials, Inc. (Materials) to its stockholders. types of production contracts with varying production delivery
In October 1996, the exchange was consummated, subsequent to schedules. Accordingly, the results of a particular year, or year-
which the Corporation had no remaining ownership interest in to-year comparisons of recorded sales and profits, may not be
Materials. The transaction was accounted for at fair value, resulting indicative of future operating results. The following comparative
in a reduction in the Corporation’s stockholders’ equity of $750 analysis should be viewed in this context.
million and the recognition of a pretax gain of $365 million in
other income and expenses.
$30,000
In November 1996, the Corporation announced the proposed
divestiture of two of its business units, Armament Systems and
Defense Systems. This transaction, which concluded with the $25,000
Corporation’s receipt of $450 million in cash in January 1997, had
no pretax effect on the results of operations for 1997 or 1996. $20,000
On a combined basis, the Materials exchange and the Armament
Systems and Defense Systems divestiture noted above increased $15,000
1996 net earnings by $351 million.
In April 1996, the Corporation consummated its business com-
$10,000
bination with Loral Corporation (Loral) for a total purchase price,
including acquisition costs, of approximately $7.6 billion (the Loral
Transaction). In addition to the acquisition of Loral’s defense elec- $5,000
tronics and systems integration businesses, the Loral Transaction
’98
’97
’96
resulted in the Corporation acquiring shares of preferred stock of $0
(a)
Loral Space & Communications, Ltd. (Loral SpaceCom), a newly-
Net Sales
formed company, which were convertible into 20 percent of Loral
(In millions)
SpaceCom’s common stock on a diluted basis at the date of acquisi-
(a) Reflects the business combination with Loral Corporation since
tion. The operations of the businesses acquired in connection with
April 1996.
the Loral Transaction have been included in the results of opera-
tions of the Corporation since April 1996.
The Corporation’s consolidated net sales for 1998 were $26.3
Formation of Lockheed Martin Global Telecommunications
billion, a decrease of six percent compared to 1997. Net sales dur-
In August 1998, the Corporation announced the formation of
ing 1997 were $28.1 billion, an increase of four percent compared
Lockheed Martin Global Telecommunications, Inc. (Global
to 1996. Excluding the impact of the operations of divested entities,
Telecommunications), a wholly-owned subsidiary of the Corporation.
which are discussed below, net sales for 1998 would have remained
Global Telecommunications will combine investments in several
relatively consistent with 1997, and would have increased by five
existing joint ventures and certain elements of the Corporation under
percent for 1997 compared to 1996. The sales decrease in the
a dedicated management team focused on capturing a greater portion
Space & Strategic Missiles segment in 1998 would have been offset
of the worldwide telecommunications services market. Effective
by sales increases for the other business segments, after adjusting
January 1, 1999, the following operations and investments became a
for divestiture activities. Sales increases in 1997 in the Space &
part of Global Telecommunications: Lockheed Martin Intersputnik,
Strategic Missiles, Aeronautics and Information & Services seg-
Ltd., a strategic venture with Moscow-based Intersputnik that
ments, as well as the inclusion of the operations of the businesses
is scheduled to deploy its first satellite in 1999; Astrolink
acquired in connection with the Loral Transaction for a full year in
International Ltd., a strategic venture that will provide global
1997 versus nine months in 1996, more than offset the reduction in
interactive multimedia services using next-generation broadband
sales due to divested operations. The U.S. Government remained
satellite technology; the elements of Lockheed Martin Missiles
the Corporation’s largest customer, comprising approximately 70
& Space, Lockheed Martin Management & Data Systems and
percent of the Corporation’s net sales for 1998 compared to
Lockheed Martin Western Development Laboratories that provide
66 percent in 1997 and 70 percent in 1996.
commercial communications capabilities; the Corporation’s invest-
The Corporation’s operating profit (earnings before interest and
ment in Americom Asia Pacific, LLC, a joint venture with GE
taxes) for 1998 was approximately $2.5 billion, a decrease of nine
Americom that is scheduled to launch a satellite in 1999 that will
percent compared to 1997. Operating profit for 1997 was $2.8
serve broadcasters in the Asia-Pacific region; and the Corporation’s
billion, a two percent increase compared to 1996. The reported
investment in ACeS International Limited, a joint venture that
amounts for the three years presented include the financial impacts
will provide cellular telephone communications in regions of Asia.
of various nonrecurring and unusual items, the details of which are
Additionally, the Corporation intends to combine the operations
of Global Telecommunications and COMSAT upon consummation
of the Tender Offer and the Merger.
19. 17
Lockheed Martin Corporation
described below. Excluding the effects of these nonrecurring and
unusual items for each year, operating profit for 1998 would $4.00
have decreased by six percent compared to 1997, and would have
increased by nine percent in 1997 compared to 1996. For 1998 $3.00
compared to 1997, decreases in operating profit at the Space &
Strategic Missiles and Information & Services segments more than $2.00
offset the increase in operating profit at the Electronics segment.
For 1997 compared to 1996, increases in operating profits at the
$1.00
Space & Strategic Missiles and Aeronautics segments more than (a) (d) (e)
offset a reduction in operating profit at the Information & Services
’96 ’97 ’98
$0
segment. For a more detailed discussion of the operating results of (c)
(b)
the business segments, see “Discussion of Business Segments” below.
Operating profit in 1998 included the effects of a nonrecurring -$1.00
and unusual pretax charge, net of state income tax benefits, totaling
$233 million related to CalComp Technology, Inc. (CalComp), a -$2.00
majority-owned subsidiary of the Corporation. In the fourth quarter
Diluted Earnings
of 1998, the Corporation decided that it would not increase existing
(Loss) Per Share
credit for CalComp to support ongoing operations, and agreed to
(In dollars)
provide financing, subject to certain conditions, for a plan providing
for the timely non-bankruptcy shutdown of CalComp’s business.
(a) Excluding the effects of the Materials exchange, the divestiture of two
The above actions resulted in a charge related to the impairment
business units, and the charges associated with the environmental
of assets and estimated costs required to accomplish the shutdown
remediation business, impairment in values for certain assets, and
of CalComp’s operations.
other costs, 1996 diluted earnings per share would have been $2.72.
(b) Reflects the business combination with Loral Corporation since
April 1996.
$1,500
(c) Includes the effects of a deemed preferred stock dividend in determining
net loss applicable to common stock in the computation of loss per
share which resulted from the GE Transaction. The effect of this deemed
$1,200
dividend was to reduce the diluted per share amount by $4.93.
(d) Excluding the effects of the deemed preferred stock dividend, the gain on
the transaction with GE, and the charges related to the Corporation’s
$900
decision to exit certain lines of business and impairment in values for
certain assets, and including the dilutive effects of preferred stock
conversion and stock options, 1997 diluted earnings per share would
$600
have been $3.02.
(e) Excluding the effects of a nonrecurring and unusual charge related to
CalComp, 1998 diluted earnings per share would have been $3.11.
$300
(c)
(a) (d)
’98
’97
’96
$0
(b) During the fourth quarter of 1997, in addition to recording the
Net Earnings tax-free gain resulting from the GE Transaction, the Corporation
(In millions) recorded nonrecurring and unusual pretax charges, net of state
income tax benefits, totaling $457 million. These charges related
(a) Excluding the effects of the Materials exchange, the divestiture of two
to the Corporation’s decision to exit certain lines of business and
business units, and the charges associated with the environmental
related to impairment in the values of various non-core investments
remediation business, impairment in values for certain assets, and
and certain other assets.
other costs, 1996 net earnings would have been $1,205 million.
Operating profit in 1996 included the gain on the Materials
(b) Reflects the business combination with Loral Corporation since
exchange. In addition, during the fourth quarter of 1996, the
April 1996.
(c) Excluding the effects of the gain on the transaction with GE, and the Corporation recorded nonrecurring pretax charges, net of state
charges related to the Corporation’s decision to exit certain lines of income tax benefits, of $307 million. These charges related to the
business and impairment in values for certain assets, 1997 net earnings Corporation’s environmental remediation business, and related to
would have been $1,292 million.
impairment in the values of non-core investments and certain other
(d) Excluding the effects of a nonrecurring and unusual charge related to
assets, and costs for facility closings and transfers of programs.
CalComp, 1998 net earnings would have been $1,184 million.
20. 18
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS (Continued)
December 31, 1998
The Corporation’s reported net earnings for 1998 were $1.0 conversion and stock options were factored into the diluted earnings
billion, a decrease of 23 percent compared to 1997. Reported net per share calculation, diluted earnings per share for 1998, 1997 and
earnings for 1997 were $1.30 billion, a decrease of three percent 1996 would have been $3.11, $3.02 and $2.72, respectively.
compared to the reported 1996 net earnings of $1.35 billion. The The Corporation’s debt to capitalization ratio improved from
1998 reported amount includes the after-tax effect of the CalComp 70 percent at year-end 1997 to 64 percent at December 31, 1998.
nonrecurring and unusual charge, which decreased net earnings by Total debt (including short-term borrowings) at December 31, 1998
$183 million, or $.48 per diluted share. The 1997 reported amount decreased to $10.9 billion from $11.9 billion at year-end 1997.
includes the tax-free gain resulting from the GE Transaction of Total stockholders’ equity increased to $6.1 billion at December 31,
$311 million, and the after-tax effects of the nonrecurring and 1998 from $5.2 billion at year-end 1997. The Corporation paid
unusual charges described above of $303 million which, on a dividends of $310 million in 1998, or $.82 per common share.
combined basis, decreased the 1997 diluted loss per share by $.02.
Industry Considerations
The 1996 reported amounts include the after-tax effects of the
The Corporation’s primary lines of business are in advanced tech-
Materials exchange and the provision for the after-tax effect of the
nology systems for aerospace and defense, serving both government
Corporation’s divestiture of its Armament Systems and Defense
and commercial customers. In recent years, domestic and world-
Systems business units. On a combined basis, these transactions
wide political and economic developments have strongly affected
increased 1996 net earnings by $351 million. The 1996 reported
these markets, requiring significant adaptation by market participants.
amounts also include the after-tax impact of the nonrecurring
The U.S. aerospace and defense industry has experienced years
charges described above, which decreased net earnings by $209
of declining budgets for research, development, test and evaluation,
million. These nonrecurring and unusual items increased 1996
and procurement. Currently, after 14 years of continuous declines in
diluted earnings per share by $.32 on a combined basis. Excluding
the U.S. defense budget, expenditures (after adjusting for inflation)
the effects of these nonrecurring and unusual items, net earnings for
are at their lowest point since before World War II. The portion of
1998, 1997 and 1996 would have been approximately $1.18 billion,
the Federal budget devoted to defense is at its lowest percentage in
$1.29 billion and $1.20 billion, respectively.
modern history. The industry participants’ reaction to the shrinking
The Corporation reported diluted earnings (loss) per share of
budgets has been to combine to maintain critical mass and achieve
$2.63, $(1.56) and $3.04 for 1998, 1997 and 1996, respectively. For
significant cost savings.
purposes of determining 1997 net loss applicable to common stock
The U.S. Government had been supportive of industry consolida-
used in the computation of loss per share, the excess fair value of
tion activities through 1997, and the Corporation had been at the
assets transferred to GE over the carrying value of the preferred
forefront of these activities. Through its own consolidation activi-
stock (approximately $1.8 billion) was treated as a deemed pre-
ties, the Corporation has been able to pass along savings to its
ferred stock dividend and deducted from 1997 net earnings. This
customers, principally the U.S. Department of Defense. Though
deemed dividend had a significant impact on the 1997 loss per
new consolidation activities among the large U.S. aerospace and
share calculations, but did not impact reported 1997 net earnings.
defense companies have declined recently, the much anticipated
The effect of this deemed dividend was to reduce the basic and
consolidation of the European defense industry may be starting.
diluted per share amounts by $4.93. If the nonrecurring and unusual
In January 1999, British Aerospace P.L.C. announced that it intends
items described above were excluded from the calculation of earn-
to purchase the Marconi Electronics unit of General Electric
ings per share and, for 1997, if the dilutive effects of preferred stock
Company P.L.C. of Great Britain.
With the decline of significant domestic industry consolidation,
$1.00
major aerospace companies will need to focus on cost savings and
efficiency improvements. The Corporation has already focused
on cutting costs, raising productivity, and capitalizing on synergies
$.80
and best practices which should improve its competitiveness in
the future.
$.60
There are now signs that the continuing declines in the defense
budget may have ended, with proposals being made for modest
increases in the next several years. The Corporation’s broad mix of
$.40
programs and capabilities makes it a likely beneficiary of increased
defense spending.
As a government contractor, the Corporation is subject to U.S.
$.20
Government oversight. The government may investigate and make
inquiries of the Corporation’s business practices and conduct audits
’98
’96
’97
’96
’98
$0
of contract performance and cost accounting. These investigations
may lead to claims against the Corporation. Under U.S. Government
Dividends Per
procurement regulations and practices, an indictment of a govern-
Common Share
ment contractor could result in that contractor being fined and/or
(In dollars)
21. 19
Lockheed Martin Corporation
suspended for a period of time from eligibility for bidding on, or substantial advances from the customer in advance of launch, and a
for award of, new government contracts. A conviction could result sizable percentage of these advances are forwarded to Khrunichev
in debarment for a specified period of time. Similar government State Research and Production Space Center (Khrunichev), the
oversight exists in most other countries where the Corporation manufacturer in Russia, to provide for the manufacture of the related
conducts business. Although the outcome of such investigations launch vehicle. Significant portions of such advances would be
and inquiries cannot be predicted, in the opinion of management, required to be refunded to each customer if launch services were
there are no claims, audits or investigations pending against the not successfully provided within the contracted time frame. At
Corporation that are likely to have a material adverse effect on the December 31, 1998, approximately $990 million related to launches
Corporation’s business or its consolidated results of operations, not yet provided was included in customer advances and amounts
cash flows or financial position. in excess of costs incurred, and approximately $740 million of pay-
The Corporation remains exposed to other inherent risks associated ments to Khrunichev for launches not yet provided was included
with U.S. Government contracting, including technological uncertain- in inventories. Through year end 1998, launch services provided
ties and obsolescence, changes in government policies and depen- through LKEI and ILS have been in accordance with contract terms.
dence on annual Congressional appropriation and allotment of funds. An additional risk exists related to launch vehicle services in
Many of the Corporation’s programs involve development and appli- Russia. Under a trade agreement in effect since September 1993
cation of state-of-the-art technology aimed at achieving challenging between the United States and Russia, the number of Russian
goals. As a result, setbacks and failures can occur. In 1998, for launches of U.S. built satellites into geosynchronous and geosyn-
example, the Corporation experienced difficulties related to its chronous transfer orbit is limited to fifteen from trade agreement
Theater High Altitude Area Defense (THAAD) system and commer- inception through the year 2000. Officials of the U.S. Government
cial space programs. It is important for the Corporation to resolve the have stated that this limit will not be raised until Russia takes satis-
related performance issues to achieve success on these programs. factory action to resolve missile technology proliferation concerns.
The Corporation continues to focus on expanding its presence in This limit, if not raised or eliminated, could impair the Corporation’s
related commercial and non-defense markets, most notably in space ability to achieve certain of its business objectives related to launch
and telecommunications activities, information management and services, satellite manufacture and telecommunications market
systems integration. Although these lines of business are not depen- penetration. At December 31, 1998, approximately $375 million of
dent on defense budgets, they share many of the risks associated the $990 million of customer advances and approximately $280
with the Corporation’s primary businesses, as well as others unique million of the $740 million of payments to Khrunichev disclosed in
to the commercial marketplace. Such risks include development of the prior paragraph are associated with launches in excess of the
competing products, technological feasibility and product obsoles- number currently allowed under the quota. Management is working
cence. The telecommunications market is expected to double over to achieve a favorable resolution to raise or eliminate the limitation
the next five years. Although the Corporation has limited experience on the number of Russian launches.
and sales in this market as of the end of 1998, the Corporation hopes The Corporation has entered into agreements with RD AMROSS,
to apply its technological capabilities and the benefits of the merger a joint venture of the Pratt & Whitney division of United Technologies
with COMSAT, if consummated, to meet the increasing demand for Corporation and the Russian firm NPO Energomash, for the devel-
broadband, Internet and virtual network services. opment and purchase, subject to certain conditions, of up to 101
In connection with expanding its portfolio of offered products RD-180 booster engines for use in two models of the Corporation’s
and services in commercial space and telecommunications activi- launch vehicles. Terms of the agreements call for payments to be
ties, the Corporation has entered into various joint venture, teaming made to RD AMROSS upon the achievement of certain milestones
and other business arrangements, including some with foreign part- in the development and manufacturing processes. Approximately
ners. The conduct of international business introduces other risks $100 million of payments made under these agreements were
into the Corporation’s operations, including fluctuating economic included in the Corporation’s inventories at December 31, 1998.
conditions, fluctuations in relative currency values and the potential
Discussion of Business Segments
for unanticipated cost increases and timing issues resulting from the
The Corporation’s operations are divided into five business seg-
deterioration of political relations.
ments: Space & Strategic Missiles; Electronics; Aeronautics;
In 1992, the Corporation entered into a joint venture with
Information & Services; and Energy and Other. Effective January 1,
two Russian government-owned space firms to form Lockheed-
1998, management responsibility for United Space Alliance, a lim-
Khrunichev-Energia International, Inc. (LKEI). Lockheed Martin
ited liability company owned by the Corporation and The Boeing
owns 51% of LKEI and consolidates the operations of LKEI into its
Company, was reassigned from the Information & Services segment
financial statements. LKEI has exclusive rights to market launches
to the Space & Strategic Missiles segment. Management reporting
of commercial, non-Russian-origin payloads to space on the Proton
of certain other activities was also reassigned among the Space &
rocket from a launch site in Kazakhstan. In 1995, another joint
Strategic Missiles, Electronics, and Energy and Other segments.
venture was formed, International Launch Services (ILS), with the
Consequently, 1997 and 1996 operating profit amounts for these
Corporation and LKEI each holding 50 percent ownership. ILS
segments have been restated to conform with the 1998 presentation.
was formed to market commercial Atlas and Proton launch services
worldwide. Contracts for Proton launch services typically require
22. 20
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS (Continued)
December 31, 1998
Space & Strategic Missiles
The following table displays net sales for the Lockheed Martin
business segments for 1998, 1997 and 1996, which correspond to Net sales of the Space & Strategic Missiles segment decreased by
the segment information presented in Note 17 to the consolidated 10 percent in 1998 compared to 1997 and increased by five percent
financial statements: in 1997 compared to 1996. The segment’s 1998 net sales activity
was adversely impacted by reductions in Atlas and Proton commer-
1998 1997 1996
(In millions)
cial launch vehicle activities, primarily as a result of delays in avail-
Net Sales
ability of commercial satellites due to supplier issues, a reduction in
Space & Strategic Missiles $ 7,461 $ 8,303 $ 7,904
volume on the Trident fleet ballistic missile program, and a decrease
Electronics 7,342 7,069 6,675
in volume in classified program activities. During 1997, increases
Aeronautics 5,996 6,045 5,596
in Proton launch services volume and additional revenues from
Information & Services 5,212 6,468 5,893
commercial satellite programs contributed roughly equally to the
Energy and Other 255 184 807
segment’s growth as compared to 1996.
$26,266 $28,069 $26,875
Operating profit for the segment decreased by 17 percent in 1998
compared to 1997 after having increased by 19 percent for 1997
Operating profit (loss) by industry segment for 1998, 1997 and
compared to 1996. The 1998 decrease resulted from the same issues
1996, including the effects of the nonrecurring and unusual items
that impacted net sales, as discussed above, as well as from losses
discussed previously, is displayed in the table below. This informa-
and performance related charges totaling approximately $100 million
tion also corresponds to the segment information presented in
in the commercial space product areas. This decrease was partially
Note 17 to the consolidated financial statements.
offset by a third quarter favorable adjustment of approximately
1998 1997 1996
(In millions)
$128 million, which resulted from a significant improvement in the
Operating Profit (Loss) Atlas launch vehicle program related to the retirement of program
Space & Strategic Missiles $ 976 $1,096 $ 973 and technical risk based upon a current evaluation of the program’s
Electronics 733 576 673 historical performance, and approximately $50 million related to
Aeronautics 654 612 441 the favorable impact of the restructure of a commercial satellite
Information & Services (25) 111 290
program which occurred in the fourth quarter. The 1997 increase
Energy and Other 184 384 356
resulted equally from improved margins on Atlas launches and the
$2,522 $2,779 $2,733 increase in Proton launch activity mentioned previously.
Electronics
The following table displays the pretax impact of the nonrecurring
The Electronics segment’s net sales increased by four percent in
and unusual items discussed earlier as reflected in each segment’s
1998 compared to 1997, and by six percent in 1997 compared to
operating profit (loss) for each of the three years presented:
1996. Excluding the operations of the segment’s Commercial
1998 1997 1996
(In millions)
Electronics unit, which was divested during the first quarter of 1998,
Nonrecurring and Unusual Items— net sales in 1998 would have increased by eight percent from 1997.
(Loss) Profit: Nearly $200 million of the increase in 1998 resulted from greater
Consolidated Effects
production deliveries of postal systems equipment and, to a lesser
Nonrecurring and unusual charges $(233) $(457) $(307)
extent, net sales were favorably impacted by increases in surface ship
Gain on GE Transaction — 311 —
systems and control systems activities in 1998. Net sales for 1997
Gain on Materials exchange — — 365
included a full year of the operations of certain businesses acquired
$(233) $(146) $ 58
in connection with the Loral Transaction versus nine months in
Segment Effects 1996, offset by the absence of sales in 1997 resulting from the
Space & Strategic Missiles $— $ (87) $ (25) divestiture of the Corporation’s Armament Systems and Defense
Electronics — (69) —
Systems businesses. Adjusting the results of operations to reflect
Aeronautics — (44) (46)
these companies on a comparable basis, 1997 net sales would have
Information & Services (233) (163) (86)
decreased by two percent compared to 1996.
Energy and Other — 217 215
Operating profit for the segment increased by 14 percent in 1998
$(233) $(146) $ 58
compared to 1997, following a four percent decrease in 1997 com-
pared to 1996. Adjusting the results of operations to reflect the
In an effort to make the following discussion of significant operat-
items previously mentioned on a comparable basis, operating profit
ing results of each business segment more understandable, the effects
would have increased by 14 percent in 1998 compared to 1997, and
of these nonrecurring and unusual items discussed earlier have been
decreased by 10 percent in 1997 compared to 1996. During 1998,
excluded. The Space & Strategic Missiles and Aeronautics segments
operating profit increased primarily due to improved margins on elec-
generally include programs that are substantially larger in terms of
tronic defense systems and, to a lesser extent, the volume increases
sales and operating profits than those included in the other segments.
that impacted net sales as discussed above. During 1997, operating
Accordingly, due to the significant number of smaller programs in
profit decreased as a result of investments in new programs as well
the Electronics and Information & Services segments, the impacts of
as reduced margins for the Commercial Electronics unit.
performance on individual programs typically are not as material to
these segments’ results of operations.