September 30, 2022

General Dynamics reports second-quarter 2021 financial results

Net earnings of $737 million, up 17.9% from year-ago quarter

Diluted EPS of $2.61, up 19.7% from year-ago quarter

$1.1 billion in cash provided by operating activities

Very strong Gulfstream order activity

Reston, Virginia, General Dynamics on July 28 reported second-quarter 2021 net earnings of USD737 million on revenue of USD9.2 billion. diluted earnings per share (EPS) were USD2.61.

EPS grew 19.7 per cent on a 17.9 per cent increase in net earnings, as company-wide operating margin expanded to 10.4 per cent, up 140 basis points from the year-ago quarter. Backlog of USD89.2 billion was up eight per cent from the year-ago quarter.

“The company performed impressively this quarter, delivering very strong cash flow, improved margins and significant Aerospace order activity,” said Phebe N. Novakovic, chairman and chief executive officer. “Emerging from the pandemic, we remain focused on operating discipline and wise deployment of capital.”

“The company performed impressively this quarter, delivering very strong cash flow, improved margins and significant Aerospace order activity. Emerging from the pandemic, we remain focused on operating discipline and wise deployment of capital.”

-Phebe N. Novakovic, chairman and chief executive officer, General Dynamics

Cash

Net cash provided by operating activities in the quarter totaled USD1.1 billion. Free cash flow from operations, defined as net cash provided by operating activities, less capital expenditures, was USD943 million.

Backlog

Backlog at the end of second-quarter 2021 was USD89.2 billion. Estimated potential contract value, representing management’s estimate of value in unfunded indefinite delivery, indefinite quantity (IDIQ) contracts and unexercised options, was USD41.1 billion. Total estimated contract value, the sum of all backlog components, was USD130.3 billion at the end of the quarter.

Overall demand remained strong in the quarter, with a consolidated book-to-bill ratio of 1-to-1.

Significant awards in the quarter included USD135 million from the U.S. Navy to provide ongoing lead yard services for the Virginia-class submarine program and options totaling USD1.6 billion of additional potential value; USD620 million from the U.S.

Army to upgrade Stryker vehicles to the double-V-hull A1 configuration; USD435 million from the Army to produce Stryker Initial Maneuver Short-Range Air Defense (IM-SHORAD) vehicles; USD240 million from the Centers for Medicare and Medicaid Services (CMS) for several contracts, including work to provide cloud services and software tools; USD145 million from the Army for the production of Hydra-70 rockets; and USD865 million for several key contracts for classified customers.

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