(Reuters) - Lockheed Martin Corp beat estimates for fourth-quarter revenue and earnings on Tuesday, but last year delivered fewer-than-forecast F-35 jets, the program that President Donald Trump has criticized program as too expensive.
The Pentagon's No. 1 weapons supplier also said internal controls for financial reporting were ineffective at its Sikorsky helicopter business. Lockheed LMT.N shares were down 2.3 percent at $251.54.
Lockheed could not validate the accuracy of financial information, according to a source who spoke on condition of anonymity because they were not authorized to speak publicly.
Lockheed continues to audit the systems and did not expect to identify material deficiencies, the source added. A Lockheed representative declined to comment.
Lockheed delivered 46 F-35s in 2016, fewer than the 53 it had expected. Still, net sales for the F-35 business unit, Aeronautics, were up 14 percent from 2015 due to increased production of the stealthy F-35.
This is the first time Lockheed reported results since Donald Trump’s election as president in November. Trump has criticized some of Lockheed’s biggest programs including the F-35 jet fighter for being too expensive.
Marillyn Hewson, Lockheed’s chief executive officer, said the defense contractor plans to “drive affordability” in 2017. Hewson has met Trump four times and discussed lowering costs of Lockheed’s products including the F-35.
Lockheed expects 2017 net sales to rise between 4.6 percent and 7.1 percent, compared with a previous forecast of a 7 percent increase. It sees 2017 earnings of $12.25 to $12.55 per share.
Analysts, on average, expected 2017 profit of $12.87 per share on a nearly 5 percent increase in sales, according to Thomson Reuters I/B/E/S. Net sales rose to $13.75 billion in the quarter from $11.52 billion a year earlier.
Net earnings from continuing operations increased to $959 million, or $3.25 per share, from $817 million, or $2.63 per share.
Analysts, on average, expected a profit of $3.06 per share on revenue of $13.03 billion.
(This story has been corrected to drop extraneous word in first paragraph.)
Reporting by Ankit Ajmera in Bengaluru and Mike Stone in Washington; Editing by Savio D’Souza and Jeffrey Benkoe
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