L3Harris Technologies (LHX) Q4 Earnings Beat Estimates
Zacks Investment Research | Feb 03, 2020 09:06PM ET
L3Harris Technologies, Inc.’s (NYSE:LHX) adjusted earnings from continuing operations in fourth-quarter 2019 came in at $2.85 per share, which surpassed the Zacks Consensus Estimate of $2.75 by 3.6%. The bottom line also increased 28% from the year-ago quarter’s $2.22.
Excluding one-time items, the company reported GAAP earnings of $1.77 per share compared with $1.88 in the year-ago quarter.
The year-over-year uptick can be attributed to higher volumes from the L3Harris merger, strong operational performance and the integration savings gain on the sale of the Harris Night Vision business in the third quarter.
Total Revenues
In the quarter under review, the company’s revenues came in at $4,832 million, exceeding the Zacks Consensus Estimate of $4,809 million by 0.5%. Revenues in the reported quarter were favorably impacted by strong growth across Integrated Mission Systems, Space and Airborne Systems and Communication Systems.
Segmental Performance
Integrated Mission Systems: Net sales at the segment improved 11% to $1,471 million from the prior-year quarter’s $1,331 million, primarily driven by strength in the ISR and Electro Optical businesses.
Operating income came in at $197 million compared with $148 million in the year-ago quarter. Moreover, operating margin expanded 230 basis points (bps) to 13.4%.
Space and Airborne Systems: The segment recorded net sales of $1,198 million in the fourth quarter, up 12% year over year. The upside can be attributed to the ramping up of modernization in the F-35 platform in Avionics, increased production of B-52 aircraft in Electronic Warfare, and growth in ground-based adjacencies and exquisite systems in classified areas.
Operating income increased to $216 million from $199 million in the year-ago quarter. Operating margin contracted 60 bps to 18%.
Communication Systems: Net sales at the segment rose 10% to $1,119 million, led by a ramp-up in U.S. DoD modernization programs in Tactical Communications and Integrated Vision Solutions as well as increased demand from state and federal customers in Public Safety.
Operating income increased to $259 million from $227 million in the year-ago quarter. Operating margin expanded 80 bps to 23.1%.
Aviation Systems: Net sales at the segment improved 7% to $1,090 million, led by growth in defense and commercial aviation products.
Operating income increased to $162 million from $76 million. Operating margin expanded 740 bps to 14.9%.
L3Harris Technologies Inc Price, Consensus and EPS Surprise
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