Martin Marietta Corp., the nation's third-largest defense contractor, reported a 31 percent gain in second-quarter earnings despite a nearly 5 percent drop in sales.
The company attributed the higher profits to its consolidation actions after the acquisition of General Electric Co.'s aerospace business and the Atlas rocket division of General Dynamics Corp. These included the shifting of work from some plants to others and the closing of some facilities.
Martin earned $162.7 million, or $1.54 a share, compared with $124.1 million, or $1.15 a share, in the same period last year.
Sales fell 4.7 percent, to $2.49 billion.
Charles P. Manor, a company spokesman at its headquarters in Bethesda, attributed the decline in sales to the completion of work on several major programs, including the production of automatic mail sorting equipment for the U.S. Postal Service and an airborne reconnaissance system for the military.
Martin Marietta also took a one-time charge of $37 million against second-quarter earnings as a result of higher-than-anticipated costs associated with its production of jet engine thrust reversers built at its Middle River complex.
The charge was against a contract the company has with Pratt & Whitney Corp. It was not associated with the big General Electric thrust reverser contract the company announced in December, which was credited with keeping the Middle River complex from closing.
The charge for the Pratt & Whitney thrust reverser contract was more than offset by a $50 million breakup fee the company received in the quarter from Grumman Corp., which terminated its merger agreement with Martin Marietta in April.
Norman R. Augustine, Martin's chairman and chief executive, said consolidation, including the closing of Martin's submarine warfare plant in Glen Burnie and shifting of the work to Syracuse, N.Y., is increasing the company's competitiveness.
These [second-quarter] results . . . confirm our confidence in the benefits of being at the forefront of the consolidation of the U.S. aerospace industry," Mr. Augustine said.
Sales of the Electronics Group, which includes the Middle River operations, fell 20 percent, or $250 million, during the quarter, to just under $1 billion. Mr. Manor said earnings were also lower but declined to say by how much.
Martin Marietta Materials Inc. completed its first full quarter as a publicly traded company with sales of $137 million, up 11 percent, and operating earnings of $29 million, a gain of 21 percent over the same period last year. The corporation holds 81 percent of the aggregates unit.
For the first half of the year, net earnings were $347 million, or $3.31 a share. This included a nonrecurring gain of $70.2 million, equal to 56 cents a share, from the initial public offering of a 19 percent interest in Martin Marietta Materials.
Due to accounting changes related to retirement and post-employment benefits, the company posted a loss of $228.9 million, or $2.57 a share, in the first half of 1993. Without the accounting changes, results for the period were net earnings of $200 million, or $1.95 a share.
@Martin Marietta Corp.
Ticker .... Yesterday's
Symbol .... Cls. ... Chg.
ML ........ 43 3/8 . -1 1/2
6/30 ........... 2nd qtr. ... Year ago ... Chg.
Revenue ...... $2,491,000 .. $2,613,300 .. -4.7%
Net Income ..... $162,700 .... $124,100 .. +31.1%
Primary EPS ....... $1.54 ....... $1.15 .. +33.9%
.............. 6 mos. ........ Year ago .... Chg.
Revenue ...... $4,525,300 ....$3,781,900 ... +19.6%
Net Income ..... $347,300 ... $(228,900)* .. --
Primary EPS ....... $2.76 ...... $(2.57)* .. --
* Includes a charge of $429 million, or $4.52 a share, for accounting changes
=1 Figures in thousands (except per share data.)