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Northrop quarterly profit rose on strong global defense spending
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Northrop quarterly profit rose on strong global defense spending
Apr 25, 2024 4:10 AM

April 25 (Reuters) - U.S. defense contractor Northrop

Grumman ( NOC ) reported a 12% rise in first-quarter profit on

Thursday, supported by a global defense spending boost and a

robust backlog.

International demand for U.S. weaponry has risen following

Russia's invasion of Ukraine and conflicts in the Middle East.

"Robust global defense spending and our strong backlog,

along with expanding margins, continue to support our multi-year

outlook for free cash flow growth," said CEO Kathy Warden.

Profit in Northrop's Defense Systems segment rose 11% in the

first quarter, helped by higher demand for rocket motors and

Stand-in Attack Weapon, a tactical air-to-surface missile.

Northrop and L3Harris ( LHX ) are the only companies that

supply sought-after rocket motors, used in guided

multiple-launch rocket systems, that played a crucial role in

supporting Ukraine's defense efforts against Russian forces.

Northrop's aeronautic systems business posted a 25% jump in

operating income, benefiting from strong demand for E2 Hawkeye

aircraft and Lockheed Martin's ( LMT ) F-35.

Northrop Grumman ( NOC ), the largest subcontractor for the F-35 jet

delivery to Pentagon, has not yet been affected by delays in

software updates from Lockheed Martin ( LMT ). However, analysts

caution that further delays could potentially hit Northrop.

Last week, Northrop lost on a $17 billion contract to

Lockheed to develop the next generation of interceptors to

defend the United States against an intercontinental ballistic

missile attack.

Sales at Northrop's Space Systems division rose 9% to $3.65

billion in the reported quarter.

Total quarterly sales jumped 9% to $10.1 billion.

Overall profit rose to $944 million, or $6.32 per diluted

share, from $842 million, or $5.50 per diluted share, a year

earlier.

(Reporting by Pratyush Thakur in Bengaluru; Editing by Shinjini

Ganguli)

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