Lockheed Martin 2005 Annual Report Download - page 33

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   

Electronic฀Systems’฀operating฀results฀included฀the฀following:
(In฀millions)  2004 2003
Net฀sales  $฀ 9,729 $฀ 8,996
Operating฀profit  969 858
Backlog฀at฀year-end  18,239 17,339
Net฀sales฀for฀Electronic฀Systems฀increased฀9%฀in฀2005฀as฀
compared฀to฀2004.฀Higher฀volume฀in฀tactical฀and฀surface฀sys-
tems฀programs฀contributed฀to฀increased฀sales฀of฀$495฀million฀
at฀Maritime฀Systems฀&฀Sensors฀(MS2).฀Platform,฀Training฀&฀
Transportation฀ Solutions฀ (PT&TS)฀ sales฀ increased฀ $310฀ mil-
lion฀ primarily฀ due฀ to฀ platform฀ integration฀ activities.฀ Air฀
defense฀ and฀ fire฀ control฀ programs฀ contributed฀ to฀ increased฀
sales฀of฀$40฀million฀at฀Missiles฀&฀Fire฀Control฀(M&FC).฀
Net฀sales฀for฀Electronic฀Systems฀increased฀8%฀in฀2004฀as฀
compared฀ to฀ 2003.฀ The฀ increase฀ in฀ sales฀ was฀ due฀ to฀ higher฀
volume฀in฀MS2฀and฀M&FC.฀Higher฀volume฀on฀surface฀systems฀
programs฀ accounted฀ for฀ most฀ of฀ MS2’s฀ sales฀ growth฀ of฀ $450฀
million.฀M&FC’s฀sales฀increased฀$265฀million,฀primarily฀due฀
to฀higher฀volume฀on฀fire฀control฀and฀tactical฀missile฀programs.
Operating฀ profit฀ for฀ the฀ segment฀ increased฀ by฀ 15%฀ in฀
2005฀ compared฀ to฀ 2004.฀ Operating฀ profit฀ increased฀ by฀ $80฀
million฀at฀M&FC฀mainly฀due฀to฀improved฀performance฀on฀fire฀
control฀and฀air฀defense฀programs.฀Performance฀on฀surface฀sys-
tems฀programs฀contributed฀to฀an฀increase฀in฀operating฀profit฀of฀
$50฀ million฀ at฀ MS2.฀ PT&TS฀ operating฀ profit฀ increased฀ $10฀
million฀primarily฀due฀to฀improved฀performance฀on฀simulation฀
and฀training฀programs.฀
Operating฀ profit฀ for฀ the฀ segment฀ increased฀ by฀ 13%฀ in฀
2004฀compared฀to฀2003.฀Operating฀profit฀increased฀$145฀mil-
lion฀due฀to฀improved฀performance฀on฀tactical฀missile฀and฀fire฀
control฀ programs฀ at฀ M&FC฀ and฀ on฀ radar฀ programs฀ at฀ MS2.฀
The฀decrease฀in฀operating฀profit฀at฀PT&TS฀was฀due฀to฀a฀$25฀
million฀loss฀provision฀recorded฀in฀the฀third฀quarter฀of฀2004฀on฀
certain฀international฀simulation฀and฀training฀contracts.
The฀ increase฀in฀ backlog฀during฀2005฀over฀ 2004฀ resulted฀
from฀increased฀orders฀on฀development฀programs.฀

Space฀Systems’฀operating฀results฀included฀the฀following:
(In฀millions)  2004 2003
Net฀sales   $฀ 6,359 $฀ 6,024
Operating฀profit  489 403
Backlog฀at฀year-end  16,112 12,813
Net฀ sales฀ for฀ Space฀ Systems฀ increased฀ by฀ 7%฀ in฀ 2005฀
compared฀to฀2004.฀During฀the฀year,฀sales฀growth฀in฀Satellites฀
and฀ Strategic฀ &฀ Defensive฀ Missile฀ Systems฀ (S&DMS)฀ offset฀
declines฀ in฀ Launch฀ Services.฀ The฀ $410฀ million฀ increase฀ in฀
Satellites฀sales฀was฀due฀to฀higher฀volume฀on฀government฀satel-
lite฀programs฀that฀more฀than฀offset฀declines฀in฀commercial฀sat-
ellite฀activities.฀There฀were฀no฀commercial฀satellite฀deliveries฀
in฀ 2005,฀ compared฀ to฀ four฀ in฀ 2004.฀ Increased฀ sales฀ of฀ $235฀
million฀in฀S&DMS฀were฀attributable฀to฀the฀fleet฀ballistic฀mis-
sile฀and฀missile฀defense฀programs.฀The฀$180฀million฀decrease฀
in฀Launch฀Services’฀sales฀was฀mainly฀due฀to฀having฀three฀Atlas฀
launches฀in฀2005฀compared฀to฀six฀in฀2004.
Net฀ sales฀ for฀ Space฀ Systems฀ increased฀ by฀ 6%฀ in฀ 2004฀
compared฀ to฀ 2003,฀ as฀ increases฀ in฀ Satellites฀ of฀ $320฀ million฀
and฀ S&DMS฀ of฀ $75฀ million฀ more฀ than฀ offset฀ a฀ $55฀ million฀
decrease฀in฀Launch฀Services.฀The฀increase฀in฀Satellites฀was฀due฀
to฀increased฀volume฀on฀government฀satellite฀programs฀and฀one฀
additional฀ commercial฀ satellite฀delivery฀ in฀2004.฀In฀ S&DMS,฀
the฀increase฀was฀primarily฀attributable฀to฀fleet฀ballistic฀missile฀
programs.฀The฀ lower฀volume฀ in฀Launch฀Services฀was฀mainly฀
due฀ to฀ a฀ decline฀ in฀ the฀ Titan฀ launch฀ vehicle฀ program,฀ which฀
more฀than฀offset฀increases฀in฀both฀Atlas฀launches฀(six฀in฀2004฀
compared฀to฀five฀in฀2003)฀and฀Proton฀launches฀(four฀in฀2004฀
compared฀to฀two฀in฀2003).
Operating฀profit฀for฀the฀ segment฀increased฀ 25%฀in฀ 2005฀
compared฀ to฀ 2004.฀ Operating฀ profit฀ increased฀ in฀ Launch฀
Services,฀S&DMS฀and฀Satellites.฀In฀Launch฀Services,฀the฀$60฀
million฀increase฀in฀operating฀profit฀was฀primarily฀attributable฀
to฀ improved฀ performance฀ on฀ the฀ Atlas฀ vehicle฀ program.฀
Satellites’฀ operating฀ profit฀ increased฀ $35฀ million฀ due฀ to฀ the฀
higher฀ volume฀ and฀ improved฀ performance฀ on฀ government฀
satellite฀ programs,฀ which฀ more฀ than฀ offset฀ the฀ decreased฀
operating฀ profit฀ due฀ to฀ the฀ decline฀ in฀ commercial฀ satellite฀
deliveries.฀The฀$20฀million฀increase฀in฀S&DMS฀was฀attribut-
able฀ to฀ higher฀ volume฀ on฀ fleet฀ ballistic฀ missile฀ and฀ missile฀
defense฀programs.
Lockheed฀Martin฀Corporation