Profit Up 15% at Northrop on 36% Gain in Revenue
Northrop continued its fast-track growth in the third quarter, reporting a 15% growth in profits on a 36% increase in sales in the period ended Sept. 30.
The Los Angeles-based aerospace firm said it earned $47.8 million on sales of $1.2 billion in the third quarter, up from $41.4 million on sales of $894 million in the year-earlier period.
Aerospace analysts attributed most of the large increase in sales to the firm’s top-secret advanced technology bomber program, better known as the “stealth” bomber.
Gregory Kieselmann, senior vice president of Morgan, Olmstead, Kennedy & Gardner, estimated that Northrop will receive about $1 billion in stealth bomber revenue this year, representing about 25% of its sales.
Northrop refers to stealth revenue under the euphemism “customer sponsored research,” which it said was a principal contributor to sales growth in the third quarter. Kieselmann said the company remains under strict Air Force orders to not discuss the program, despite its increasing transparency.
Rep. Les Aspin (D-Wisc.), chairman of the House Armed Services Committee, said last week that the sheer size of the stealth bomber program will force it to become “white”--or public--probably next year.
The company also said it received $4.2 million in insurance compensation, part of an expected settlement of $46.5 million on the crash of two F-20 Tigershark jets that the company built with its own funds. Total spending on the Tigershark in the first nine months amounted to $130.4 million, up from $103 million in the same period of 1984.
