L-3 Communications Holdings Inc. said Nov. 1 that its third-quarter net income fell 18 percent as the U.S. government cut back on defense spending.
The New York-based defense contractor, which makes secure communications systems, earned $192 million, or $1.97 per share, down from $235 million, or $2.24 per share, in the same quarter last year.
Excluding a tax benefit and the spinoff of its Engility unit, L-3 posted an adjusted profit from continuing operations of $1.87 per share for the recent quarter. That matched analyst expectations, according to a FactSet poll.
Revenue edged down less than 1 percent to $3.28 billion from $3.30 billion, but managed to beat the average forecast of $3.25 billion.
Acquisitions added $63 million to the recent quarter’s sales, and sales to commercial and foreign government customers increased 19 percent to $808 million. But that was offset by a 16 percent drop in sales to $352.6 million at the company’s national security services business, stemming from lower U.S. government and military spending.
The company raised its prediction for full-year earnings per share from continuing operations to a range of $7.80 to $7.90 per share. Previously, L-3’s forecast ranged between $7.70 to $7.85 per share. The company cited an income tax gain and the Link UK acquisition for the raised outlook.
It also boosted its revenue forecast to a range of $13 billion to $13.1 billion, from $12.95 billion to $13.15 billion previously. Analysts expect a profit of $7.81 per share and $13.04 billion in revenue, on average. AP