UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (date of earliest event reported)
July 29, 2004
NORTHROP GRUMMAN CORPORATION
(Exact name of registrant as specified in its charter)
| DELAWARE | 1-16411 | No. 95-4840775 | ||
| (State or other jurisdiction of incorporation or organization) |
(Commission File Number) |
(I.R.S. Employer Identification Number) |
1840 Century Park East, Los Angeles, California 90067
www.northropgrumman.com
(Address of principal executive offices and internet site)
(310) 553-6262
(Registrant’s telephone number, including area code)
| Item 7. | Financial Statements and Exhibits. |
(c) Exhibits
The following press release is included as an exhibit to this report furnished pursuant to Item 12:
Exhibit 99—Northrop Grumman Corporation press release (including financial schedules) dated July 29, 2004
| Item 12. | Results of Operations and Financial Condition. |
On July 29, 2004, Northrop Grumman Corporation issued a press release announcing its financial results for the quarter ended June 30, 2004. The press release is furnished as Exhibit 99.
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Northrop Grumman Corporation | ||||||||
| (Registrant) | ||||||||
| July 29, 2004 |
By: |
/s/ John H. Mullan | ||||||
| (Date) | John H. Mullan Corporate Vice President and Secretary | |||||||
Exhibit Index
| Exhibit No. |
Description | |
| 99 | Furnished—Northrop Grumman Corporation press release (including financial schedules) dated July 29, 2004 |
Exhibit 99
|
|
NEWS |
Contacts: Frank Moore (Media) (310) 201-3335
Gaston Kent (Investors) (310) 201-3423
For Immediate Release
Northrop Grumman Reports
Second Quarter 2004 Results
Earnings per Share from Continuing Operations Increase 44 Percent to $0.79
Income from Continuing Operations Increases 40 Percent
Sales Increase 11 Percent to $7.4 Billion
Guidance Raised for 2004 Sales, Earnings per Share and Net Cash Provided by Operations
LOS ANGELES – July 29, 2004 – Northrop Grumman Corporation (NYSE: NOC) reported that second quarter 2004 income from continuing operations rose 40 percent to $289 million, or $0.79 per diluted share, compared with $207 million, or $0.55 per diluted share, for the same period of 2003. The increase reflects higher sales and operating margin, as well as a lower tax rate than in the second quarter of 2003. Sales for the second quarter of 2004 increased 11 percent to $7.4 billion from $6.6 billion for the same period of 2003.
“These results reinforce Northrop Grumman’s record of solid sales and earnings growth and demonstrate our ability to consistently deliver strong financial performance,” said Ronald D. Sugar, chairman, chief executive officer and president. “Based on the strength of year-to-date results, we now expect 2004 sales to increase to around $29 billion, earnings per share from continuing operations to grow to between $2.90 and $3.00, and net cash provided by operations to be about $1.7 billion.”
Operating margin for the 2004 second quarter increased 24 percent to $483 million from $391 million in the same period a year ago. Second quarter 2004 operating margin includes lower pension expense and higher unallocated corporate expenses than in the second quarter of 2003, as well as the effect of a $60 million pre-tax charge for increased projected costs for the F-16 Block 60 fixed-price development combat avionics program reported in the Electronic Systems segment.
Second quarter 2004 pension expense, as determined in accordance with accounting principles generally accepted in the United States, declined to $86 million from $140 million in the second quarter of 2003. Pension expense allocated to contracts pursuant to U.S. Government Cost Accounting Standards (CAS) increased operating margin by $77 million in the second quarter of 2004 and $66 million for the comparable 2003 period.
Unallocated corporate expenses were $53 million in the second quarter of 2004 compared with $22 million in the second quarter of 2003. The $31 million increase in unallocated corporate expenses was primarily due to higher mark-to-market stock compensation expense and deferred state income taxes.
The effective tax rate applied to income from continuing operations for the 2004 second quarter was 26 percent compared with 31 percent in the 2003 second quarter. During the second quarter of 2004, the company completed studies and recognized additional tax credits of $31 million related to research and development and export sales activities for the years 1997 through 2003.
Net income for the 2004 second quarter was $295 million, or $0.81 per diluted share, compared with $205 million, or $0.54 per diluted share for the same period of 2003.
Contract acquisitions were $5.3 billion in the second quarter of 2004 compared with $5.2 billion for the same period of 2003. Total funded backlog was $26.2 billion at June 30, 2004, compared with $26.9 billion at Dec. 31, 2003. Total backlog, which includes funded backlog and firm orders for which funding is not currently contractually obligated by the customer, was $57.2 billion at June 30, 2004, compared with $58.2 billion at Dec. 31, 2003.
2004 Guidance
The company expects 2004 sales of approximately $29 billion versus previous guidance of approximately $28 billion. Earnings per share from continuing operations are now expected to range between $2.90 and $3.00 versus previous guidance of between $2.80 and $2.95. Net cash provided by operating activities is expected to be approximately $1.7 billion in 2004, versus the prior estimate of approximately $1.5 billion.
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Segment Results
ELECTRONIC SYSTEMS
| ($ in millions) SECOND QUARTER | ||||||
| 2004 |
2003 | |||||
| Sales |
$ | 1,591 | $ | 1,512 | ||
| Operating Margin |
138 | 148 | ||||
| % Operating margin to sales |
8.7% | 9.8% | ||||
Electronic Systems second quarter 2004 sales increased 5 percent from the second quarter of 2003 due to revenue increases in Government Systems and Defensive Systems. Sales in Government Systems rose 72 percent, primarily due to higher sales to the U.S. Postal Service. Defensive Systems revenue increased 39 percent reflecting increased sales of infrared countermeasures for military helicopters, LITENING targeting pods, and test equipment. These sales increases were partially offset by lower sales in Aerospace Systems and Space Systems. Second quarter 2004 operating margin declined 7 percent due to a $60 million pre-tax charge for increased projected costs for the F-16 Block 60 fixed-price development combat avionics program. The principal portion of the charge reflects a higher estimate to complete qualification and production of the “Falcon Edge” electronic warfare suite. The impact of the charge was partially offset by improved performance and contract close-outs for several programs in the Navigation Systems, Defensive Systems, Aerospace Systems, and Government Systems business areas.
SHIPS
| ($ in millions) SECOND QUARTER | ||||||
| 2004 |
2003 | |||||
| Sales |
$ | 1,557 | $ | 1,368 | ||
| Operating Margin |
100 | 23 | ||||
| % Operating margin to sales |
6.4% | 1.7% | ||||
Ships 2004 second quarter sales, which include the financial results of the Newport News and Ship Systems sectors, increased 14 percent compared with the 2003 second quarter, driven by higher sales in Surface Combatants, Amphibious & Auxiliary, and Submarines, which were partially offset by a decline in revenue in Aircraft Carriers. Surface Combatants sales rose 38 percent, primarily due to higher DD(X) program revenue. Amphibious & Auxiliary revenue rose 31 percent due to higher revenue in the LPD-17 and LHD-8 programs. Operating margin for the 2004 second quarter increased more than fourfold compared with the 2003 second quarter due to a $68 million pre-tax charge for the commercial Polar Tanker program recorded in the second quarter of 2003.
3
INFORMATION TECHNOLOGY
| ($ in millions) SECOND QUARTER | ||||||
| 2004 |
2003 | |||||
| Sales |
$ | 1,225 | $ | 1,123 | ||
| Operating Margin |
73 | 62 | ||||
| % Operating margin to sales |
6.0% | 5.5% | ||||
Information Technology second quarter 2004 sales increased 9 percent due to higher revenue in Government Information Technology and Enterprise Information Technology. Government Information Technology revenue increased 13 percent, primarily due to new business awards and organic sales growth in existing programs. Enterprise Information Technology increased 12 percent, primarily due to expanded opportunities for product and service sales with civil agencies. Second quarter 2004 operating margin increased 18 percent, as compared with the second quarter of 2003, primarily due to higher revenue in Government Information Technology and Enterprise Information Technology and improved program performance in Commercial Information Technology.
MISSION SYSTEMS
| ($ in millions) SECOND QUARTER | ||||||
| 2004 |
2003 | |||||
| Sales |
$ | 1,298 | $ | 1,100 | ||
| Operating Margin |
86 | 78 | ||||
| % Operating margin to sales |
6.6% | 7.1% | ||||
Mission Systems second quarter 2004 sales increased 18 percent, primarily due to revenue increases in Command, Control & Intelligence Systems and Missile Systems. Command, Control & Intelligence Systems revenue increased 26 percent, primarily due to higher revenue for the Tactical Automated Security Systems II program. Missile Systems revenue increased 12 percent, reflecting revenue from the new Kinetic Energy Interceptors program and the XonTech acquisition, as well as increased revenue from existing programs. Second quarter 2004 operating margin rose 10 percent due to higher volume compared with second quarter 2003 results. Operating margin in the 2003 second quarter included the recognition of favorable performance on a restricted program.
4
INTEGRATED SYSTEMS
| ($ in millions) SECOND QUARTER | ||||||
| 2004 |
2003 | |||||
| Sales |
$ | 1,133 | $ | 1,004 | ||
| Operating Margin |
90 | 124 | ||||
| % Operating margin to sales |
7.9% | 12.4% | ||||
Integrated Systems sales for the second quarter of 2004 increased 13 percent over the second quarter of 2003, primarily due to higher sales in Airborne Early Warning/Electronic Warfare Systems and Air Combat Systems. Airborne Early Warning/Electronic Warfare Systems revenue increased 28 percent due to higher volume in the E-2 Advanced Hawkeye and EA-6B programs. Air Combat Systems revenue increased 8 percent due to higher volume in the F-35, Global Hawk, and Multi-Platform Radar Technology Insertion programs. Operating margin for the second quarter of 2004 declined 27 percent reflecting the segment’s changing business mix, which includes a greater proportion of lower margin development programs, including F-35, Global Hawk, E-2 Advanced Hawkeye, and the E-10A.
SPACE TECHNOLOGY
| ($ in millions) SECOND QUARTER | ||||||
| 2004 |
2003 | |||||
| Sales |
$ | 836 | $ | 733 | ||
| Operating Margin |
61 | 55 | ||||
| % Operating margin to sales |
7.3% | 7.5% | ||||
Space Technology second quarter 2004 sales rose 14 percent over second quarter 2003 results, primarily due to higher sales in Software Defined Radios, Civil Space, and Intelligence, Surveillance & Reconnaissance. Software Defined Radios revenue increased 38 percent, primarily due to higher volume in the F-35 and F/A-22 programs. Civil Space revenue increased 28 percent, primarily due to higher volume in the National Polar-Orbiting Operational Environmental Satellite System and James Webb Space Telescope programs. Intelligence, Surveillance & Reconnaissance revenue also rose more than 18 percent. Second quarter 2004 operating margin rose 11 percent as compared with the second quarter 2003, primarily due to higher sales volume.
Debt and Cash Measurements
Northrop Grumman’s total debt was $5.8 billion at June 30, 2004, compared with $5.9 billion at Dec. 31, 2003. Interest expense for the second quarter of 2004 declined to $112 million from $119 million for the 2003 second quarter as a result of a reduction in fixed-rate debt acquired with the acquisition of TRW Inc. Second quarter 2004 interest expense also includes the impact of the adoption of Statement of Financial Accounting Standards No. 150 – Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity, which was adopted on July 1, 2003, and required $6 million of dividends payable on mandatorily redeemable preferred stock for the quarter to be classified as interest expense.
5
Net cash provided by operating activities for the 2004 second quarter decreased to $610 million versus net cash provided by operating activities of $737 million for the second quarter of 2003. The decrease was primarily due to higher tax payments in the second quarter of 2004 compared with the second quarter of 2003.
During the second quarter of 2004, the company repurchased approximately 2.4 million shares of its common stock at an average price of $49.92 per share, after giving effect for the 2-for-1 stock split, in the form of a stock dividend, effective June 21, 2004. Since the Aug. 20, 2003, announcement of a plan to repurchase up to $700 million of Northrop Grumman common stock, the company has repurchased approximately 10.4 million shares at an average price of $47.50.
About Northrop Grumman
Northrop Grumman Corporation is a global defense company headquartered in Los Angeles, Calif. Northrop Grumman provides a broad array of technologically advanced, innovative products, services and solutions in systems integration, defense electronics, information technology, advanced aircraft, shipbuilding and space technology. The company has 125,000 employees and operates in all 50 states and 25 countries and serves U.S. and international military, government and commercial customers.
Certain statements and assumptions in this release contain or are based on “forward-looking” information (that Northrop Grumman believes to be within the definition in the Private Securities Litigation Reform Act of 1995) and involve risks and uncertainties, and include, among others, statements in the future tense, and all statements accompanied by terms such as “project,” “expect,” “estimate,” “assume,” “guidance” or variations thereof. This information reflects the company’s best estimates when made, but the company expressly disclaims any duty to update this information if new data becomes available or estimates change after the date of this release.
Such “forward-looking” information includes, among other things, projected deliveries, expected funding for various programs, future effective income tax rates, financial guidance regarding sales, segment operating margin, pension expense, employer contributions under pension plans and medical and life benefits plans, and cash flow, and is subject to numerous assumptions and uncertainties, many of which are outside Northrop Grumman’s control. These include Northrop Grumman’s assumptions with respect to future revenues, expected program performance and cash flows, returns on pension plan assets and variability of pension actuarial and related assumptions, the outcome of litigation and appeals, environmental remediation, divestitures of businesses, successful reduction of debt, successful negotiation of contracts with labor unions, effective tax rates and timing and amounts of tax payments, and anticipated costs of capital investments, among other things. Northrop Grumman’s operations are subject to various additional risks and uncertainties resulting from its position as a supplier, either directly or as subcontractor or team member, to the U.S. Government and its agencies as well as to foreign governments and agencies; actual outcomes are dependent upon various factors, including, without limitation, Northrop Grumman’s successful performance of internal plans; government customers’ budgetary constraints; customer changes in short-range and long-range plans; domestic and international competition in both the defense and
6
commercial areas; product performance; continued development and acceptance of new products and, in connection with any fixed price development programs, controlling cost growth in meeting production specifications and delivery rates; performance issues with key suppliers and subcontractors; government import and export policies; acquisition or termination of government contracts; the outcome of political and legal processes; natural disasters and terrorist acts; legal, financial, and governmental risks related to international transactions and global needs for military aircraft, military and civilian electronic systems and support, information technology, naval vessels, space systems and related technologies, as well as other economic, political and technological risks and uncertainties and other risk factors set out in Northrop Grumman’s filings from time to time with the Securities and Exchange Commission, including, without limitation, Northrop Grumman reports on Form 10-K and Form 10-Q.
Northrop Grumman will webcast its security analyst conference call at 12 p.m. EDT on July 29, 2004. A live audio broadcast of the conference call along with a supplemental presentation will be available on the investor relations page of the company’s Web site at http://www.northropgrumman.com.
# # #
0704-248
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7
| NORTHROP GRUMMAN CORPORATION FINANCIAL HIGHLIGHTS ($ in millions, except per share) (unaudited) |
SCHEDULE 1 |
| SECOND QUARTER |
FIRST SIX MONTHS |
||||||||||||
| 2004 |
2003 |
2004 |
2003 |
||||||||||
| OPERATING RESULTS HIGHLIGHTS |
|||||||||||||
| Total contract acquisitions (1) |
$ | 5,344 | $ | 5,240 | $ | 13,764 | $ | 12,330 | |||||
| Total sales |
7,374 | 6,627 | 14,479 | 12,493 | |||||||||
| Total operating margin |
483 | 391 | 917 | 719 | |||||||||
| Income from continuing operations |
289 | 207 | 517 | 381 | |||||||||
| Net income |
295 | 205 | 527 | 458 | |||||||||
| Diluted earnings per share from continuing operations |
.79 | .55 | 1.42 | 1.00 | |||||||||
| Diluted earnings per share |
.81 | .54 | 1.45 | 1.21 | |||||||||
| Net cash provided by (used in) operating activities |
610 | 737 | 873 | (375 | ) | ||||||||
| JUNE 30, 2004 |
DECEMBER 31, 2003 (4) |
|||||
| BALANCE SHEET HIGHLIGHTS |
||||||
| Cash and cash equivalents |
$ 559 | $ 342 | ||||
| Accounts receivable, net |
3,487 | 3,198 | ||||
| Inventoried costs, net |
1,220 | 1,147 | ||||
| Property, plant, and equipment, net |
4,033 | 4,036 | ||||
| Total debt |
5,764 | 5,881 | ||||
| Net debt (2) |
5,205 | 5,539 | ||||
| Mandatorily redeemable preferred stock |
350 | 350 | ||||
| Shareholders’ equity |
16,012 | 15,785 | ||||
| Total assets |
33,327 | 33,009 | ||||
| Net debt to capitalization ratio (3) |
24 | % | 26 | % | ||
| (1) | Contract acquisitions represent orders received during the period for which funding has been contractually obligated by the customer. |
| (2) | Total debt less cash and cash equivalents. |
| (3) | Net debt divided by the sum of shareholders’ equity and total debt. |
| (4) | Certain prior year amounts have been reclassified to conform to the 2004 presentation. |
| NORTHROP GRUMMAN CORPORATION OPERATING RESULTS ($ in millions, except per share) (unaudited) |
SCHEDULE 2 |
| SECOND QUARTER |
FIRST SIX MONTHS |
|||||||||||||||
| 2004 |
2003 (1) |
2004 |
2003 (1) |
|||||||||||||
| Sales |
||||||||||||||||
| Electronic Systems |
$ | 1,591 | $ | 1,512 | $ | 3,129 | $ | 2,850 | ||||||||
| Ships |
1,557 | 1,368 | 3,001 | 2,563 | ||||||||||||
| Information Technology |
1,225 | 1,123 | 2,455 | 2,214 | ||||||||||||
| Mission Systems |
1,298 | 1,100 | 2,481 | 2,023 | ||||||||||||
| Integrated Systems |
1,133 | 1,004 | 2,280 | 1,829 | ||||||||||||
| Space Technology |
836 | 733 | 1,642 | 1,381 | ||||||||||||
| Intersegment Eliminations |
(266 | ) | (213 | ) | (509 | ) | (367 | ) | ||||||||
| $ | 7,374 | $ | 6,627 | $ | 14,479 | $ | 12,493 | |||||||||
| Operating margin |
||||||||||||||||
| Electronic Systems |
$ | 138 | $ | 148 | $ | 296 | $ | 269 | ||||||||
| Ships |
100 | 23 | 186 | 98 | ||||||||||||
| Information Technology |
73 | 62 | 144 | 123 | ||||||||||||
| Mission Systems |
86 | 78 | 162 | 134 | ||||||||||||
| Integrated Systems |
90 | 124 | 206 | 212 | ||||||||||||
| Space Technology |
61 | 55 | 112 | 87 | ||||||||||||
| Total segment operating margin |
548 | 490 | 1,106 | 923 | ||||||||||||
| Reconciliation to operating margin (2) |
||||||||||||||||
| Unallocated expenses |
(53 | ) | (22 | ) | (163 | ) | (52 | ) | ||||||||
| Pension expense |
(86 | ) | (140 | ) | (176 | ) | (280 | ) | ||||||||
| Reversal of CAS pension expense included above |
77 | 66 | 157 | 137 | ||||||||||||
| Reversal of royalty income included above |
(3 | ) | (3 | ) | (7 | ) | (9 | ) | ||||||||
| Operating margin |
483 | 391 | 917 | 719 | ||||||||||||
| Interest income |
16 | 17 | 32 | 29 | ||||||||||||
| Interest expense |
(112 | ) | (119 | ) | (225 | ) | (263 | ) | ||||||||
| Other, net |
3 | 11 | 13 | 28 | ||||||||||||
| Income from continuing operations before income taxes |
390 | 300 | 737 | 513 | ||||||||||||
| Federal and foreign income taxes |
101 | 93 | 220 | 132 | ||||||||||||
| Income from continuing operations |
289 | 207 | 517 | 381 | ||||||||||||
| Income from discontinued operations, net of tax |
6 | 2 | 7 | 82 | ||||||||||||
| (Loss) gain from disposal of discontinued operations, net of tax |
(4 | ) | 3 | (5 | ) | |||||||||||
| Net income |
$ | 295 | $ | 205 | $ | 527 | $ | 458 | ||||||||
| Diluted earnings per share |
||||||||||||||||
| Continuing operations |
$ | .79 | $ | .55 | $ | 1.42 | $ | 1.00 | ||||||||
| Discontinued operations |
.02 | .02 | .22 | |||||||||||||
| Disposal of discontinued operations |
(.01 | ) | .01 | (.01 | ) | |||||||||||
| Diluted earnings per share |
$ | .81 | $ | .54 | $ | 1.45 | $ | 1.21 | ||||||||
| (1) | Certain prior year amounts have been reclassified to conform to the 2004 presentation. |
| (2) | Pension expense is included in determining the segments’ operating margin to the extent that the cost is currently recognized under U.S. Government Cost Accounting Standards (CAS). In order to reconcile from segment operating margin to total company operating margin, these amounts are reported under the caption “Reversal of CAS pension expense included above.” Total pension expense or income determined in accordance with accounting principles generally accepted in the United States is reported separately as a reconciling item under the caption “Pension expense.” The reconciling item captioned “Unallocated expenses” includes the portion of corporate, legal, environmental, other retiree benefits, stock compensation, and other expenses not allocated to the segments. |
| NORTHROP GRUMMAN CORPORATION ADDITIONAL SEGMENT INFORMATION ($ in millions) (unaudited) |
SCHEDULE 3 |
| CONTRACT ACQUISITIONS(1) |
FUNDED BACKLOG(2) |
|||||||||||||||||||||||
| SECOND QUARTER |
FIRST SIX MONTHS |
JUNE 30, |
||||||||||||||||||||||
| 2004 |
2003 (4) |
2004 |
2003 (4) |
2004 |
2003 (4) |
|||||||||||||||||||
| Electronic Systems |
$ | 1,489 | $ | 1,336 | $ | 3,261 | $ | 2,914 | $ | 6,600 | $ | 6,559 | ||||||||||||
| Ships |
592 | 782 | 2,110 | 1,632 | 8,858 | 9,430 | ||||||||||||||||||
| Information Technology |
1,207 | 930 | 2,401 | 2,256 | 2,265 | 2,151 | ||||||||||||||||||
| Mission Systems |
990 | 893 | 2,326 | 2,105 | 2,750 | 2,283 | ||||||||||||||||||
| Integrated Systems |
820 | 893 | 2,588 | 2,558 | 4,606 | 4,494 | ||||||||||||||||||
| Space Technology |
552 | 643 | 1,685 | 1,410 | 1,601 | 1,337 | ||||||||||||||||||
| Intersegment Eliminations |
(306 | ) | (237 | ) | (607 | ) | (545 | ) | (529 | ) | (364 | ) | ||||||||||||
| Total |
$ | 5,344 | $ | 5,240 | $ | 13,764 | $ | 12,330 | $ | 26,151 | $ | 25,890 | ||||||||||||
| TOTAL BACKLOG, JUNE 30, 2004 |
|||||||||||
| FUNDED |
UNFUNDED(3) |
TOTAL BACKLOG |
|||||||||
| Electronic Systems |
$ | 6,600 | $ | 2,239 | $ | 8,839 | |||||
| Ships |
8,858 | 4,926 | 13,784 | ||||||||
| Information Technology |
2,265 | 2,043 | 4,308 | ||||||||
| Mission Systems |
2,750 | 7,248 | 9,998 | ||||||||
| Integrated Systems |
4,606 | 6,018 | 10,624 | ||||||||
| Space Technology |
1,601 | 8,590 | 10,191 | ||||||||
| Intersegment Eliminations |
(529 | ) | (529 | ) | |||||||
| Total |
$ | 26,151 | $ | 31,064 | $ | 57,215 | |||||
| (1) | Contract acquisitions represent orders received during the period for which funding has been contractually obligated by the customer. |
| (2) | Funded backlog represents unfilled orders for which funding has been contractually obligated by the customer. |
| (3) | Unfunded backlog represents firm orders for which funding is not currently contractually obligated by the customer. Unfunded backlog excludes unexercised contract options and unfunded Indefinite Delivery Indefinite Quantity (IDIQ) orders. |
| (4) | Certain prior year amounts have been reclassified to conform to the 2004 presentation. |
AMORTIZATION OF PURCHASED INTANGIBLES
| SECOND QUARTER |
FIRST SIX MONTHS | |||||||||||
| 2004 |
2003 |
2004 |
2003 | |||||||||
| Electronic Systems |
$ | 22 | $ | 22 | $ | 43 | $ | 43 | ||||
| Ships |
11 | 11 | 21 | 21 | ||||||||
| Information Technology |
4 | 5 | 9 | 10 | ||||||||
| Mission Systems |
8 | 7 | 16 | 16 | ||||||||
| Integrated Systems |
3 | 3 | 7 | 7 | ||||||||
| Space Technology |
9 | 9 | 17 | 17 | ||||||||
| $ | 57 | $ | 57 | $ | 113 | $ | 114 | |||||
| NORTHROP GRUMMAN CORPORATION SALES BY BUSINESS AREA WITHIN SEGMENTS ($ in millions) (unaudited) |
SCHEDULE 4 |
| SECOND QUARTER |
FIRST SIX MONTHS |
|||||||||||||||
| 2004 |
2003 (1) |
2004 |
2003 (1) |
|||||||||||||
| Electronic Systems |
||||||||||||||||
| Aerospace Systems |
$ | 362 | $ | 429 | $ | 754 | $ | 785 | ||||||||
| C4ISR & Naval Systems |
327 | 327 | 659 | 606 | ||||||||||||
| Defensive Systems |
267 | 192 | 522 | 406 | ||||||||||||
| Navigation Systems |
199 | 191 | 383 | 365 | ||||||||||||
| Government Systems |
177 | 103 | 301 | 189 | ||||||||||||
| Space Systems |
116 | 138 | 227 | 248 | ||||||||||||
| Other |
143 | 132 | 283 | 251 | ||||||||||||
| 1,591 | 1,512 | 3,129 | 2,850 | |||||||||||||
| Ships |
||||||||||||||||
| Surface Combatants |
511 | 371 | 981 | 692 | ||||||||||||
| Aircraft Carriers |
475 | 528 | 915 | 998 | ||||||||||||
| Amphibious & Auxiliary |
346 | 265 | 652 | 468 | ||||||||||||
| Submarines |
178 | 160 | 340 | 292 | ||||||||||||
| Commercial & International |
34 | 19 | 72 | 55 | ||||||||||||
| Services & Other |
35 | 36 | 76 | 75 | ||||||||||||
| Intrasegment Eliminations |
(22 | ) | (11 | ) | (35 | ) | (17 | ) | ||||||||
| 1,557 | 1,368 | 3,001 | 2,563 | |||||||||||||
| Information Technology |
||||||||||||||||
| Government Information Technology |
740 | 654 | 1,493 | 1,278 | ||||||||||||
| Enterprise Information Technology |
202 | 180 | 378 | 362 | ||||||||||||
| Commercial Information Technology |
157 | 169 | 332 | 326 | ||||||||||||
| Technology Services |
154 | 152 | 313 | 305 | ||||||||||||
| Intrasegment Eliminations |
(28 | ) | (32 | ) | (61 | ) | (57 | ) | ||||||||
| 1,225 | 1,123 | 2,455 | 2,214 | |||||||||||||
| Mission Systems |
||||||||||||||||
| Command, Control & Intelligence Systems |
791 | 630 | 1,514 | 1,187 | ||||||||||||
| Missile Systems |
337 | 302 | 622 | 514 | ||||||||||||
| Technical & Management Services |
185 | 177 | 373 | 342 | ||||||||||||
| Intrasegment Eliminations |
(15 | ) | (9 | ) | (28 | ) | (20 | ) | ||||||||
| 1,298 | 1,100 | 2,481 | 2,023 | |||||||||||||
| Integrated Systems |
||||||||||||||||
| Air Combat Systems |
670 | 619 | 1,382 | 1,135 | ||||||||||||
| Airborne Early Warning/Electronic Warfare Systems |
318 | 248 | 598 | 427 | ||||||||||||
| Airborne Ground Surveillance/Battle Management |
147 | 139 | 303 | 269 | ||||||||||||
| Intrasegment Eliminations |
(2 | ) | (2 | ) | (3 | ) | (2 | ) | ||||||||
| 1,133 | 1,004 | 2,280 | 1,829 | |||||||||||||
| Space Technology |
||||||||||||||||
| Intelligence, Surveillance & Reconnaissance |
263 | 223 | 500 | 425 | ||||||||||||
| Civil Space |
164 | 128 | 319 | 246 | ||||||||||||
| Software Defined Radios |
142 | 103 | 285 | 188 | ||||||||||||
| Satellite Communications |
126 | 131 | 258 | 250 | ||||||||||||
| Missile & Space Defense |
102 | 106 | 201 | 195 | ||||||||||||
| Technology |
63 | 55 | 115 | 100 | ||||||||||||
| Intrasegment Eliminations |
(24 | ) | (13 | ) | (36 | ) | (23 | ) | ||||||||
| 836 | 733 | 1,642 | 1,381 | |||||||||||||
| Intersegment Eliminations |
(266 | ) | (213 | ) | (509 | ) | (367 | ) | ||||||||
| Total Sales |
$ | 7,374 | $ | 6,627 | $ | 14,479 | $ | 12,493 | ||||||||
| (1) | Certain prior year amounts have been reclassified to conform to the 2004 presentation. |