Lockheed Martin 2001 Annual Report Download - page 24

Lockheed Martin Annual Report >>> 31
Lockheed Martin Corporation
(Continued)
In 2001, the Corporation’s net loss included an
extraordinary loss of $36 million (net of a $22 million
income tax benefit), or $0.08 per diluted share, on the
early retirement of $117 million of 7% debentures due in
2011. In 2000, the Corporation’s net loss included an
extraordinary loss of $95 million (net of a $61 million
income tax benefit), or $0.24 per diluted share, on the early
retirement of approximately $1.9 billion in debt securities.
During 1999, the Corporation adopted the American
Institute of Certified Public Accountants’ Statement of Position
(SOP) No. 98-5, “Reporting on the Costs of Start-Up
Activities.” The adoption of SOP No. 98-5 resulted in the
recognition of a cumulative effect adjustment which reduced
net earnings for the year ended December 31, 1999 by
$355 million (net of a $227 million income tax benefit),
or $0.93 per diluted share.
The Corporation reported a net loss of $1 billion
($2.42 per diluted share) in 2001, a net loss of $519 mil-
lion ($1.29 per diluted share) in 2000 and net income of
$382 million ($0.99 per diluted share) in 1999. Excluding
the effects of the previously mentioned nonrecurring and
unusual items, net earnings would have been $632 million
($1.46 per diluted share) in 2001, $432 million ($1.07
per diluted share) in 2000 and $575 million ($1.50 per
diluted share) in 1999.
Discussion of Business Segments
The Corporation operates in four principal business
segments: Systems Integration, Space Systems, Aeronautics
and Technology Services. Other activities of the Corpora-
tion fall within the Corporate and Other segment. The fol-
lowing tables of financial information and related discussions
of the results of operations of the Corporation’s business
segments have been adjusted to reflect the elimination of
the Corporation’s Global Telecommunications segment dis-
cussed previously, and correspond to additional segment
information presented in “Note 17—Information on Industry
Segments and Major Customers.”
Prior period amounts have been reclassified to conform
to the realignment of the Global Telecommunications busi-
nesses and telecommunications equity investments retained
by the Corporation, as previously discussed.
(In millions) 2001 2000 1999
Net sales
Systems Integration $ 9,014 $ 9,647 $ 9,570
Space Systems 6,836 7,339 7,285
Aeronautics 5,355 4,885 5,499
Technology Services 2,763 2,649 2,574
Corporate and Other 22 21 71
$23,990 $24,541 $24,999
(In millions) 2001 2000 1999
Operating profit (loss)
Systems Integration $ 836 $ 583 $ 880
Space Systems 405 401 506
Aeronautics 416 343 247
Technology Services 130 82 137
Corporate and Other (899) (158) 227
$ 888 $ 1,251 $ 1,997
The following table displays the total impact on each
segment’s operating profit (loss) of the nonrecurring and
unusual items presented earlier for each of the three
years presented:
(In millions) 2001 2000 1999
Segment effects of nonrecurring
and unusual items—operating
(loss) profit
Systems Integration $—$ (304) $ 13
Space Systems (3) 25 21
Aeronautics ———
Technology Services —(34) —
Corporate and Other (915) (226) 215
$ (918) $ (539) $ 249
(In dollars)
Diluted Earnings
(Loss) Per Share
$0
-$2.50
-$0.50
$1.00
$2.00
-$1.50
(a) (a) (a)
’01 ’99’00
-$1.00
-$2.00
$0.50
$1.50
the effects of the items presented in the
a. Excluding the effects of the items presented in the preceding
table entitled “Effects of nonrecurring and unusual items,”
diluted earnings per share for 2001, 2000 and 1999 would
have been $1.46, $1.07 and $1.50, respectively.