(Reuters) - Lockheed Martin raised its full-year profit and revenue forecasts on Tuesday as the U.S. weapons supplier overcame coronavirus-driven supply disruptions to post higher quarterly sales in its aeronautics unit that makes the F-35 fighter jet.
Shares of the company rose 3.4% to $378 in premarket trading after Lockheed also topped analysts’ estimates for second-quarter profit.
The Pentagon has sought to make sure defense contractors do not lose highly skilled workers during the coronavirus crisis, and has used its funds to prevent employees from being laid off or poached by better-funded competitors.
“The corporation and U.S. Government’s proactive efforts, especially with regard to the supply chain, helped to partially mitigate the disruptions caused by COVID-19,” the company said in a statement. During the quarter, Lockheed used accelerated payments from the Pentagon and cash on hand to pay its suppliers $1.3 billion.
Lockheed said it expects 2020 earnings per share between $23.75 and $24.05, compared with its previous forecast of between $23.65 and $23.95.
Lockheed’s second-quarter earnings report bodes well for its peers General Dynamics Corp and Raytheon Technologies, both of which also faced disruptions caused by the pandemic.
Quarterly sales at Lockheed’s aeronautics unit rose 17.2% to $6.50 billion. Total revenue rose 12.4% to $16.22 billion. Higher sales for the F-35 program helped the unit.
In May, Lockheed said it would slow production of its stealthy F-35 fighter jets at its Texas facility, possibly delaying delivery of between 18 and 24 jets this year due to a parts shortage as the pandemic hampers production across the jet’s vast supply chain. Lockheed made 25 F-35s in the quarter, compared to 29 a year earlier.
Net earnings rose to $1.63 billion, or $5.79 per share, in the second quarter ended June 28, from $1.42 billion, or $5 per share, a year earlier.
Excluding items, the company earned $6.13 per share, above analysts’ expectations of $5.72 per share, according to IBES data from Refinitiv.
Reporting by Sanjana Shivdas in Bengaluru Mike Stone in Washington; Editing by Aditya Soni and Nick Zieminski