CALIFORNIA : Litton Posts Quarterly Loss of $21.5 Million
Defense contractor Litton Industries Inc. on Wednesday reported a $21.5-million loss in its fourth quarter after charges related to closing its computer outsourcing and professional services units.
The Woodland Hills-based company’s loss per share totaled 48 cents for the quarter ended July 31 after the charges, which came to $1.67 a share.
The $77.4-million after-tax charge also includes a $18.5-million fine under a plea agreement regarding charges that Litton concealed payments made to foreign consultants to win $190 million in military contracts.
Quarterly revenue fell to $1.23 billion from $1.24 billion for the same period last year.
“Excluding the fiscal year 1999 special charges, Litton’s results would have reflected consensus expectations,” said Chairman and Chief Executive Michael Brown.
Market research firm First Call/Thomson Financial said industry analysts had an average earnings estimate of $1.20 a share for the quarter.
Litton shares fell $1 to close at $63.25 on the New York Stock Exchange.
“As was previously announced, these special charges were the result of strategic decisions made by management last fiscal year to exit unprofitable lines of business and to consolidate certain manufacturing facilities to reduce costs and enhance competitiveness,” Brown said.
The businesses to be eliminated, which provide organizational and computer services for companies, have been a drag on the profit of Litton’s Information Systems division during the year.
Exiting those businesses will also produce charges that will be recorded during fiscal 2000, but they are not expected to exceed $11 million.
During the quarter, Litton agreed to buy shipbuilder Avondale Industries for $529 million. That deal was completed in August.
For the fiscal year, after special charges of $1.67 a share, Litton’s diluted earnings were $2.58 a share, compared with $3.82 for the previous year.
Fiscal year net earnings were $120.6 million, while revenue rose to $4.83 billion, compared with $181.4 million and $4.4 billion, respectively, for fiscal 1998.
