General Dynamics reports lower 3Q earnings

October 23, 2013

FALLS CHURCH, Va. (AP) -- Defense contractor General Dynamics Corp. said Wednesday that net income fell 8.5 percent on lower revenue, but the results still beat Wall Street forecasts.

The company offset weaker defense spending with cost-cutting and strong results in its Gulfstream business jets division.

Net income was $651 million, or $1.84 per share, for the July-September period compared with $600 million, or $1.70 per share, a year earlier. Analysts surveyed by FactSet expected adjusted earnings of $1.68 per share.

Revenue fell 1.7 percent to $7.80 billion. Analysts expected $7.75 billion.

Sales in the company's aerospace division, which includes Gulfstream jets, jumped by 17.2 percent, partly offsetting a 30.1 percent plunge in revenue in the combat-systems segment. Two other units, marine systems and information technology, grew slightly.

General Dynamics cut operating costs by 2.7 percent. The overall operating profit margin grew to 12.3 percent, up from 11.4 percent a year earlier.

The shares fell $1.90, or 2.2 percent, to $86.26 in midday trading. At the beginning of the session, they were up 27 percent for the year.