Northrop Grumman 2009 Annual Report Download - page 56

Download and view the complete annual report

Please find page 56 of the 2009 Northrop Grumman annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 132

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132

TECHNICAL SERVICES
$ in millions 2009 2008 2007
Year Ended December 31
Sales and Service Revenues $2,776 $2,535 $2,422
Segment Operating Income 161 144 139
As a percentage of segment sales 5.8% 5.7% 5.7%
Sales and Service Revenues
2009 – Technical Services revenue increased $241 million, or 10 percent, as compared with 2008. The increase
was primarily due to $245 million higher sales in the Life Cycle Optimization & Engineering Group (LCOE),
and $74 million higher sales in the Training & Simulation Group (TSG), offset by $72 million in lower sales for
the Systems Support Group (SSG). The increase in LCOE was due to increased task orders for the Counter
Narcoterrorism Technology Program Office and higher demand on the Hunter Contractor Logistics Support
(CLS) programs in support of the DoD’s surge in Intelligence, Surveillance, and Reconnaissance (ISR) initiatives.
The increase in TSG was due to higher volume on various training and simulation programs including the Joint
Warfighting Center Support, Saudi Arabian National Guard Modernization and Training, Global Linguists
Solutions, National Level Exercise 2009 and African Contingency Operations Training Assistance programs.
These increases were partially offset by lower 2009 sales in SSG due to the completion of the Joint Base
Operations Support (JBOSC) program in 2008.
2008 – Technical Services revenue increased $113 million or 5 percent, as compared with 2007. The increase was
primarily due to $93 million in higher sales in LCOE and $42 million in higher sales in TSG, partially offset by
$26 million in lower sales in SSG. The increase in LCOE was associated with higher volume in the Hunter CLS
and B-2 Stealth Bomber programs. The increase in TSG was primarily due to higher sales volume from various
new training and simulation program awards. The decrease in SSG was primarily associated with the completion
of the JBOSC program.
Segment Operating Income
2009 – Operating income at Technical Services increased $17 million, or 12 percent, as compared with 2008.
The increase was primarily due to the higher sales volume discussed above and $3 million from performance
improvements across numerous programs.
2008 – Technical Services operating income increased $5 million, or 4 percent, as compared with 2007. The
increase in operating income was due to higher sales volume was partially offset by a higher level of planned
internal investment and final allocation of current and prior year overhead items.
BACKLOG
Total backlog at December 31, 2009, was approximately $69.2 billion. Total backlog includes both funded
backlog (firm orders for which funding is contractually obligated by the customer) and unfunded backlog (firm
orders for which funding is not currently contractually obligated by the customer). Unfunded backlog excludes
unexercised contract options and unfunded IDIQ orders. For multi-year services contracts with non-federal
government customers having no stated contract values, backlog includes only the amounts committed by the
customer.
-46-
NORTHROP GRUMMAN CORPORATION
eBP - v54508-i003_a.pdf - Page 50 of 124 - March 11, 2010 - 20:02:39