swung to a quarterly loss and warned that future results will fall short of expectations, due to higher costs and a weak performance at its air-traffic-control unit.
The Massachusetts-based defense contractor posted a third-quarter net loss of $35 million, or 8 cents a share, compared with a profit of $147 million, or 36 cents a share, in the year-ago period.
Excluding a one-time after-tax loss due to discontinued operations, the maker of missile systems and military electronics reported net income from continuing operations of $21 million, or 5 cents a share, compared with $228 million, or 56 cents per diluted share, a year earlier. On that basis, analysts had expected the company to earn 43 cents a share, according to Thomson First Call.
Revenue rose to $4.4 billion from $4.1 billion in the same period a year earlier. Government and defense sales grew 3% in the quarter, while sales at the Network Centric Systems unit, which makes air-traffic-management systems, fell 27%.
"We are disappointed that an otherwise strong quarter has been diminished by the shortfalls at Network Centric Systems and Technical Services," said Chief Executive William H. Swanson. "We have taken and will continue to take appropriate actions to address these performance issues."
Raytheon said its fourth-quarter earnings before items will range from 52 cents to 54 cents a share, missing Wall Street estimates of 58 cents a share. Sales are expected to range from $4.9 billion to $5 billion, compared with expectations of $5.1 billion.
For the full year, Raytheon forecast earnings of $1.29 to $1.31 a share, compared with market estimates of $1.74 a share. Revenue is expected to range from $17.9 billion to $18 billion, compared with estimates of $18.2 billion.
The company also trimmed its guidance for full-year 2004 income from continuing operations to a range of $1.50 to $1.60 a share, compared with its initial guidance of $1.60 to $1.70 a share. Analysts had forecast profit of $1.68 per share. The company forecast 2004 sales growth between 8% and 10%, stronger than the initial outlook of 6% to 8%.
Raytheon shares were down $1.66, or 6%, at $25.99 in morning trading Thursday.