Raytheon reports sales, profit increase

Raytheon said today sales in its most recent quarter reached $6.7 billion, up about 7% from the same three-month period a year earlier.

The contractor reported quarterly profit of $781 million, up about 23%.

Raytheon's intelligence, information and services and Forcepoint businesses recorded the largest sales growth at 12% for each.

The company attributed the sales growth in IIS to "higher net sales on classified programs in both cyber and space." The unit reported quarterly profit of $187 million, up 60 percent from the prior year.

"The increase in operating income for the quarter was primarily driven by a change in mix and other performance, which included $21 million of gains related to the consolidation, as planned, of an entity that was previously an equity investment, and $13 million of gains from asset sales," Raytheon said.

Though Forcepoint also reported a 12% increase in quarterly sales, it announced a loss of $9 million, more than the $7 million it lost during the same period last year.

The company's missile systems business reported quarterly sales of $2 billion, up 9% from the prior year, but its quarterly profit dipped 10% to hit $190 million.

Raytheon attributed the decline in profit to "lower net program efficiencies and a change in program mix."

Asked by an analyst during a call this morning why the unit's backlog declined, Toby O'Brien, Raytheon's chief financial officer, said "it's all timing related."

"We expect two multiyear production awards in the back half of this year," he said. "I wouldn't read anything into the change in the backlog."

Tom Kennedy, Raytheon's chief executive, said during the same call that the company's Standard Missile-3 Block 1B multiyear and the SM-6 multiyear will be worth roughly $4 billion.