Litton Reports Drop of 4.4% in Annual Profit
Litton Industries, which recently emerged from a restructuring that eliminated several major operating units and product lines, earned $299.5 million in the fiscal year ended July 31, a 4.4% decline from the year earlier.
The Beverly Hills-based conglomerate posted sales of $4.59 billion in fiscal 1985, down from $4.61 billion in the prior year.
Litton Chairman Fred O’Green said the company has sold divisions with combined annual sales of $1 billion since 1983. At the same time, Litton has acquired companies and product lines with combined annual sales of about $500 million.
Increased Overall Profit
The firm, however, increased its overall profit margin, earning 6.5% on continuing sales in fiscal 1985, up from 6% the year earlier.
Fourth-quarter profits rose 3%. Litton earned $76.1 million on sales of $1.1 billion, up from $73.9 million on sales of $1.1 billion in the year earlier.
Litton’s three major business segments all posted higher operating profits in 1985.
The largest profit increase came in the firm’s industrial systems and services segment, which posted operating profits of $142.6 million, a gain of 34%.
The unit, comprising Litton’s key non-military operations, produces factory automation systems, machine tools and sells resource exploration services. Profits at the unit increased almost tenfold to $41.5 million on a 5.8% decline in sales in the fourth quarter. The profit increase was attributable to improved performance in industrial automation markets and computer components, a Litton spokesman said.
Advanced electronics, primarily the firm’s aerospace guidance and control business, increased 5.8% to $221.9 million. And Litton’s Ingalls shipyard earned $94.4 million, up 7.9%.
One poor performer was the firm’s commercial products segment, where sales slid 40% to $421.7 million and operating profits plunged 72.5%. The cause was Litton’s most widely known product, its microwave oven line, and its lesser known medical-equipment line. The unit posted a $3.7-million loss in the fourth quarter.