General Dynamics Corporation (GD - Free Report) reported fourth-quarter 2016 earnings from continuing operations of $2.62 per share, beating the Zacks Consensus Estimate of $2.54 by 3.2%. Reported earnings were also up 9.2% from $2.40 recorded in the year-ago quarter.

Full-year earnings from continuing operations came in at $9.87 per share, surpassing the Zacks Consensus Estimate of $9.77 and improving 8.7% year over year.

General Dynamics Corporation Price, Consensus and EPS Surprise

General Dynamics Corporation Price, Consensus and EPS Surprise | General Dynamics Corporation Quote

Total Revenue

General Dynamics’ fourth-quarter total revenue of $8,233 million missed the Zacks Consensus Estimate of $8,258 million by 0.3%. Reported revenues, however, increased slightly from $8,229 million in the year-ago quarter.

Full-year revenues were also down a marginal 0.4% to $31,353 million. Moreover, the reported figure missed the Zacks Consensus Estimate of $31,370 million.

Backlog

The company recorded a total backlog of $59.8 billion, down 17.4% year over year. Funded backlog at the quarter end was down 4.7% to $49.4 billion.

Segment Performance

Aerospace: The segment reported fourth-quarter 2016 revenues of $2,224 million, up 3.8% year over year. Operating earnings of $436 million increased from $410 million.

Combat Systems: Segment revenues improved 10.5% to $1,684 million. Operating earnings were up 10.7% to $259 million in the quarter.

Information Systems and Technology: The segment reported revenues of $2,284 million, up 5.7%. Operating income improved 6.1% to $244 million.

Marine Systems: The segment’s revenues of $2,041 million were up 3% from the year-ago figure of $1,982 million. Operating income also increased 8.1% to $186 million.
 
Operational Highlights

Company-wide operating margin expanded 30 basis points to 13.6% from the year-ago level of 13.3%.

In the quarter under review, General Dynamics’ operating costs and expenses declined 5.1% to $7,116 million.

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Financial Condition

As of Dec 31, 2016, General Dynamics’ cash and cash equivalents were $2,334 million, compared with $2,785 million as of Dec 31, 2015.

Long-term debt as of Dec 31, 2016 was $2,988 million, higher than the 2015-end level of $2,898 million.

As of Dec 31, 2016, the company’s cash flow from operating activities was around $2,198 million, compared with $2,607 million in the year-ago period. Free cash flow from operations in 2016 was $1,806 million, compared with $2,038 million in the previous year.

Other Aerospace & Defense Releases

Rockwell Collins Inc.’s (COL - Free Report) adjusted earnings per share of $1.20 surpassed the Zacks Consensus Estimate of $1.15 by 4.3%. Reported earnings, however, slipped 0.8% from $1.21 per share earned a year ago.

Pentagon’s prime contractor, Lockheed Martin Corp. (LMT - Free Report) reported fourth-quarter 2016 earnings from continuing operations of $3.25 per share, surpassing the Zacks Consensus Estimate of $3.04 by 6.9%. Earnings also increased 23.6% from the year-ago level, courtesy of strong revenue and operating margin growth.

Textron Inc. (TXT - Free Report) reported fourth-quarter 2016 adjusted earnings from continuing operations of 80 cents per share, missing the Zacks Consensus Estimate of 87 cents by 8%.

Zacks Rank

General Dynamics currently has a Zacks Rank #3 (Hold).