Aerospace giants

Northrop Grumman

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both reported second-quarter results above Wall Street's estimates.

Northrop Grumman said it saw "another solid quarter," which included growth in its core defense business. The company earned $182 million, or $1.53 a share, compared with $175 million, or $2.01 a share, in the year-ago period. Northrop has 30.8 million more shares outstanding, leading to the EPS discrepancy.

Analysts polled by Thomson Financial/First Call had been looking for $1.46 a share from the company.

Sales for the quarter were up 20% to $4.4 billion from $3.7 billion last year, while the operating margin increased to $356 million from $338 million. The company's backlog stands at $22 billion, up from $16.8 billion last year.

Looking ahead, Northrop Grumman said it expects to earn $6.60 to $7.10 a share in 2002, ahead of analyst estimates calling for $6.07. For 2003, the company sees operating earnings of $8.15 to $8.65 a share on revenue of $20 billion to $20.5 billion.

Boeing also beat analyst estimates in the quarter, but saw its net income fall about 7% on reduced jet orders from major airlines.

Excluding nonrecurring charges, the company earned $751 million, or 92 cents a share in the quarter, down from $804 million, or 95 cents a share, in the year ago quarter. Wall Street had been expecting 80 cents a share, according to Thomson Financial/First Call.

Revenue fell to $13.9 billion from $15.5 billion last year, as commercial airplane revenue fell to $7.7 billion from $9.3 billion. Boeing delivered 112 new jet airplanes in the quarter, down from 141 a year ago as the major airlines continue to struggle with business declines in the wake of Sept. 11.

The company's military aircraft and missile systems division revenue was up 5.4% to $3.5 billion, while space and communications revenue increased 6.4% to $2.7 billion. Boeing Capital, the financial services division, saw revenue growth of 9% to $254 million.

Total company backlog was at $123 billion at the end of the quarter, down from $134.1 billion last year.

Boeing said its outlook remains unchanged, as "business units are executing to plan." The company expects free cash flow of $2.5 billion to $3 billion for 2002, and greater than $3 billion in 2003. Revenue is expected to be about $54 billion in 2002 and about $52 billion in 2003.