Lockheed Martin 2002 Annual Report Download - page 71

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SEVENTY-EIGHT
Lockheed Martin Corporation
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2002
Net Sales by Customer Category
(In millions) 2002 2001 2000
U.S. GOVERNMENT
Systems Integration $ 7,741 $ 6,952 $ 6,855
Space Systems 6,276 5,956 5,932
Aeronautics 4,483 3,437 2,784
Technology Services 2,735 2,269 2,120
$21,235 $18,614 $17,691
FOREIGN GOVERNMENTS (a)(b)
Systems Integration $ 1,583 $ 1,790 $ 2,231
Space Systems 60 94 79
Aeronautics 1,971 1,899 2,061
Technology Services 76 104 117
$ 3,690 $ 3,887 $ 4,488
COMMERCIAL(b)
Systems Integration $ 279 $ 272 $ 561
Space Systems 1,048 786 1,328
Aeronautics 17 19 40
Technology Services 293 390 413
Total business segments 1,637 1,467 2,342
Other 16 22 20
$ 1,653 $ 1,489 $ 2,362
(a) Sales made to foreign governments through the U.S. Government
are included in the foreign governments category above.
(b) Export sales included in the foreign governments and commer-
cial categories above were approximately $4.3 billion, $4.1
billion and $5.2 billion in 2002, 2001 and 2000, respectively.
NOTE 17—SUMMARY OF QUARTERLY INFORMATION
(UNAUDITED)
(In millions, 2002 Quarters
except per share data)
First Second(a) Third Fourth(b)
Net sales $5,966 $6,290 $6,542 $7,780
Earnings from operations 438 483 553 475
Earnings (loss) from
continuing operations 224 351 300 (342)
Net earnings (loss) 218 339 290 (347)
Diluted earnings (loss)
per share from
continuing operations 0.50 0.78 0.66 (0.76)
Diluted earnings (loss)
per share 0.49 0.75 0.64 (0.77)
(In millions, 2001 Quarters
except per share data)
First(d) Second Third(e) Fourth(f)
Net sales $4,747 $5,688 $6,221 $7,334
Earnings from operations 350 399 438 356
Earnings (loss) from
continuing operations 126 150 (87) (146)
Net earnings (loss) 105 144 213 (1,508)
Diluted earnings (loss)
per share from
continuing operations 0.30 0.34 (0.20) (0.34)
Diluted earnings
(loss) per share(c) 0.25 0.33 0.50 (3.49)
(a) Net earnings for the second quarter of 2002 included the effects
of an unusual item relating to the settlement of a research and
development tax credit claim. The settlement increased net earn-
ings by $90 million ($0.20 per diluted share) and was recorded
as a reduction of income tax expense.
(b) The net loss for the fourth quarter of 2002 included the following
unusual items: impairment charges related to certain of the
Corporation’s telecommunications equity investments which
increased the net loss by $504 million ($1.12 per diluted share);
a charge related to advances to Russian manufacturers which
increased the net loss by $112 million ($0.25 per diluted share);
and a charge related to the Corporation’s investment in and its
guarantee of certain obligations of Space Imaging which
increased the net loss by $106 million ($0.24 per diluted share).
(c) The sum of the diluted earnings (loss) per share amounts for
the four quarters of 2001 do not equal the related amount
included in the consolidated statement of operations for the year
ended December 31, 2001 due to the exclusion of the impact of
dilutive stock options from the third quarter calculation of per
share amounts.
(d) Net earnings for the first quarter of 2001 included the following
unusual items: a gain on the sale of surplus real estate which
increased net earnings by $72 million ($0.17 per diluted share);
and an impairment charge related to the Corporation’s invest-
ment in Americom Asia-Pacific which reduced net earnings by
$65 million ($0.15 per diluted share).
(e) Net earnings for the third quarter of 2001 included the following
unusual items: an impairment charge related to the Corporation’s
investment in Loral Space which reduced net earnings by $235
million ($0.54 per diluted share); a loss on the early repayment of
debt which reduced net earnings by $36 million ($0.08 per diluted
share); and divestiture and other portfolio shaping activities
which, on a combined basis, decreased net earnings by $3 million.
Net earnings also includes a gain on the sale of IMS which is
included in discontinued operations and which increased net
earnings by $309 million ($0.71 per diluted share).
(f) The net loss for the fourth quarter of 2001 included the following
unusual items: a write-down of the Corporation’s investment in
Astrolink and related costs which increased the net loss by $267
million ($0.62 per diluted share); and charges related to the
Corporation’s exit from its global telecommunications services
business which increased the net loss by $117 million ($0.27 per
diluted share). The net loss also includes other unusual charges
related to impairment of goodwill and other assets, and other costs
associated with certain global telecommunications businesses held
for sale. These charges are recorded in discontinued operations
and increased the net loss by $1.3 billion ($3.09 per diluted share).