July 25, 2012 / 11:50 AM / 5 years ago

General Dynamics posts lower earnings, lowers full year

WASHINGTON (Reuters) - Defense and aerospace company General Dynamics Corp (GD.N) posted lower second-quarter earnings and lowered its outlook for full-year earnings, citing delays in contract awards for its information systems business due to continued uncertainty about the U.S. budget outlook.

Earnings from continuing operations fell 4.8 percent to $634 million, or $1.77 per share on a fully diluted basis, compared with $666 million, or $1.79 per share, in the year-earlier period.

Revenues edged up 0.5 percent to $7.9 billion in the second quarter from $7.89 billion.

Analysts polled by Thomson Reuters I/B/E/S expected earnings per share of $1.73 on revenues of $7.93 billion.

General Dynamics, which builds ground combat vehicles and navy warships as well as Gulfstream business jets, said operating margins rose slightly to 12.2 percent, reflecting continued cost-cutting.

“General Dynamics’ operating results in the second quarter reflect our continued focus on disciplined execution and effective cash conversion across the corporation,” said Jay Johnson, chairman and chief executive. He is retiring at the end of the year.

“Heading into the second half of 2012, I remain very confident in our continued ability to execute. However, given the impact of first-half award delays in IS&T’s tactical Communications business, as well as the likelihood of further delays in the second half, I believe it is prudent to revise the full-year earnings guidance range downward to $7.00 to $7.10 per share, fully diluted.”

Reporting By Andrea Shalal-Esa; editing by Jeffrey Benkoe

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