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Raytheon Reports Strong First Quarter Results
Raytheon Company reported first quarter 2009 income from continuing operations of $457 million up from $401 million in the first quarter 2008. Net sales for period grew across all of the Company's businesses segments, to a total of $5.9 billion, up 10% from $5.4 billion in the first quarter 2008. Operating cash flow from continuing operations for the first quarter 2009 was $411 million compared to $67 million for the first quarter 2008. Total booking were down by 20% in the first quarter with a total 5.2 billion. About 26% of the new orders came from international customers. The backlog at the end of March 09 was $37.9 billion, down from $38.9 at three months earlier. Yet the funded backlog has increased from $22 to $23 billion in this period. Yet the company has raised its sales estimates for 2009 by $100 million, to $24.4 – $24.9 billion.
Sales of Raytheon's Integrated Defense Systems (IDS) accumulated 1,262 million, up 6% from last year's first quarter. The higher sales were attributed primarily to sales of Patriot missiles to the US Army, UAE and Taiwan. However, these performances were achieved at a lower operating income ($188) with operating margin reduced to 14.9%.
Other Raytheon's missile programs are handled by the company's Missile Systems segment. Which recorded net sales of $1,368 million, at an operating margin of 11.5% - Standard and AMRAAM missiles and Evolved Sea-Sparrow were the most active programs.
Raytheon's Intelligence and Information Systems group recorded net sales of 784 million in this quarter, up 13% from last year's, due primarily to growth in classified programs which also provided a steady margin of 7.8%.
Network Centric activities reported a nice sales volume of $1,154 million, up 8% from last year, primarily on different U.S. Army programs. The segment improved operating income by 31% with the segments' operating margin increasing to 14.1%.
Space and airborne systems also improved sales by 7% to $1046 million, by increasing international tactical radar and domestic classified programs.
The company is bullish about future prospects, primarily in the air and missile defense field, as well as naval systems. The new priorities set for the U.S. FY2010 defense budget are also in favour of Raytheon's fields of expertise. "we were encouraged by much of what we heard from the Secretary, especially as focus on ISR unmanned systems, training, cyber security, Standard Missile-3, Patriot and THAAD. And we are pleased that the DoD confirmed their intent to fully fund the Zumwalt." said William H. Swanson, Raytheon's Chairman and CEO. Other prospects working in favour of the company are new and potential additional international and domestic sales of Patriot and SM-3 missiles.
