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General Dynamics Reports First-Quarter 2025 Financial Results

General Dynamics Reports First-Quarter 2025 Financial Results


2025-04-23 07:17:45
(MENAFN- PR Newswire) Each of the four segments saw increases in revenue and operating earnings over the year-ago quarter, with notable increases in Aerospace, where revenue was up 45.2%, operating earnings up 69.4%, and margins expanded 210 basis points to 14.3%.

"We continue to see steady growth and improvement in operating performance across the defense portfolio," said Phebe Novakovic, chairman and chief executive officer "The Aerospace segment saw a significant increase in profitability, reflecting the manufacturing efficiencies associated with reaching higher levels of production on our new aircraft models."

Cash and Capital Deployment

Net cash used by operating activities in the quarter was $148 million due to growth of working capital. During the quarter, the company paid $383 million in dividends, invested $142 million in capital expenditures, and used $600 million to repurchase shares. The company ended the quarter with $9.6 billion in total debt and $1.2 billion in cash and equivalents on hand.

On March 5, the General Dynamics board declared a regular quarterly dividend of $1.50 per share, a 5.6% increase over last year's dividend and the 28th consecutive annual increase.

Orders and Backlog

On a company-wide basis, orders in the quarter totaled $10.2 billion, and backlog at the end of the quarter was $88.7 billion. Estimated potential contract value, representing management's estimate of additional value in unfunded indefinite delivery, indefinite quantity (IDIQ) contracts and unexercised options, was $52.7 billion. Total estimated contract value, the sum of all backlog components, was $141.3 billion.

About General Dynamics

Headquartered in Reston, Virginia, General Dynamics is a global aerospace and defense company that offers a broad portfolio of products and services in business aviation; ship construction and repair; land combat vehicles, weapons systems and munitions; and technology products and services. General Dynamics employs more than 110,000 people worldwide and generated $47.7 billion in revenue in 2024. More information is available at .

WEBCAST INFORMATION: General Dynamics will webcast its first-quarter 2025 financial results conference call at 9 a.m. EDT on Wednesday, April 23, 2025. The webcast will be a listen-only audio event available at . An on-demand replay of the webcast will be available by telephone two hours after the end of the call through April 30, 2025, at 800-770-2030 (international: +1 609-800-9909), conference ID 4299949. Charts furnished to investors and securities analysts in connection with General Dynamics' announcement of its financial results are available at .

This press release contains forward-looking statements (FLS), including statements about the company's future operational and financial performance, which are based on management's expectations, estimates, projections and assumptions. Words such as "expects," "anticipates," "plans," "believes," "forecasts," "scheduled," "outlook," "estimates," "should" and variations of these words and similar expressions are intended to identify FLS. In making FLS, we rely on assumptions and analyses based on our experience and perception of historical trends; current conditions and expected future developments; and other factors, estimates and judgments we consider reasonable and appropriate based on information available to us at the time. FLS are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. FLS are not guarantees of future performance and involve factors, risks and uncertainties that are difficult to predict. Actual future results and trends may differ materially from what is forecast in the FLS. All FLS speak only as of the date they were made. We do not undertake any obligation to update or publicly release revisions to FLS to reflect events, circumstances or changes in expectations after the date of this press release. Additional information regarding these factors is contained in the company's filings with the SEC, and these factors may be revised or supplemented in future SEC filings. In addition, this press release contains some financial measures not prepared in accordance with U.S. generally accepted accounting principles (GAAP). While we believe these non-GAAP metrics provide useful information for investors, there are limitations associated with their use, and our calculations of these metrics may not be comparable to similarly titled measures of other companies. Non-GAAP metrics should not be considered in isolation from, or as a substitute for, GAAP measures. Reconciliations to comparable GAAP measures and other information relating to our non-GAAP measures are included in other filings with the SEC, which are available at .

EXHIBIT A

CONSOLIDATED STATEMENT OF EARNINGS - (UNAUDITED)

DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS




Three Months Ended


Variance




March 30, 2025


March 31, 2024

$



%


Revenue

$ 12,223


$ 10,731

$ 1,492

13.9 %

Operating costs and expenses

(10,955)


(9,695)

(1,260)



Operating earnings

1,268


1,036

232

22.4 %

Other, net

21


14

7



Interest, net

(89)


(82)

(7)



Earnings before income tax

1,200


968

232

24.0 %

Provision for income tax, net

(206)


(169)

(37)



Net earnings

$ 994


$ 799

$ 195

24.4 %

Earnings per share-basic

$ 3.69


$ 2.92

$ 0.77

26.4 %

Basic weighted average shares outstanding

269.0


273.5





Earnings per share-diluted

$ 3.66


$ 2.88

$ 0.78

27.1 %

Diluted weighted average shares outstanding

271.7


277.0





EXHIBIT B

REVENUE AND OPERATING EARNINGS BY SEGMENT - (UNAUDITED)

DOLLARS IN MILLIONS












Three Months Ended


Variance












March 30, 2025


March 31, 2024

$



%


Revenue:



















Aerospace








$ 3,026


$ 2,084

$ 942

45.2 %

Marine Systems








3,589


3,331

258

7.7 %

Combat Systems








2,176


2,102

74

3.5 %

Technologies








3,432


3,214

218

6.8 %

Total










$ 12,223


$ 10,731

$ 1,492

13.9 %

Operating earnings:



















Aerospace








$ 432


$ 255

$ 177

69.4 %

Marine Systems








250


232

18

7.8 %

Combat Systems








291


282

9

3.2 %

Technologies








328


295

33

11.2 %

Corporate








(33)


(28)

(5)

(17.9) %

Total










$ 1,268


$ 1,036

$ 232

22.4 %

Operating margin:



















Aerospace








14.3 %


12.2 %





Marine Systems








7.0 %


7.0 %





Combat Systems








13.4 %


13.4 %





Technologies








9.6 %


9.2 %





Total










10.4 %


9.7 %





EXHIBIT C

CONSOLIDATED BALANCE SHEET

DOLLARS IN MILLIONS



















(Unaudited)




















March 30, 2025


December 31, 2024

ASSETS




















Current assets:




















Cash and equivalents















$ 1,242


$ 1,697

Accounts receivable















3,294


2,977

Unbilled receivables















9,139


8,248

Inventories















9,816


9,724

Other current assets















1,626


1,740

Total current assets















25,117


24,386

Noncurrent assets:




















Property, plant and equipment, net















6,461


6,467

Intangible assets, net















1,462


1,520

Goodwill















20,623


20,556

Other assets















2,917


2,951

Total noncurrent assets

















31,463


31,494

Total assets

















$ 56,580


$ 55,880

LIABILITIES AND SHAREHOLDERS' EQUITY




















Current liabilities:




















Short-term debt and current portion of long-term debt















$ 2,349


$ 1,502

Accounts payable















3,357


3,344

Customer advances and deposits















9,770


9,491

Other current liabilities















3,284


3,487

Total current liabilities















18,760


17,824

Noncurrent liabilities:




















Long-term debt















7,260


7,260

Other liabilities















8,335


8,733

Total noncurrent liabilities















15,595


15,993

Shareholders' equity:




















Common stock















482


482

Surplus















4,064


4,062

Retained earnings















42,082


41,487

Treasury stock















(23,034)


(22,450)

Accumulated other comprehensive loss















(1,369)


(1,518)

Total shareholders' equity















22,225


22,063

Total liabilities and shareholders' equity

















$ 56,580


$ 55,880

EXHIBIT D

CONSOLIDATED STATEMENT OF CASH FLOWS - (UNAUDITED)

DOLLARS IN MILLIONS




Three Months Ended



March 30, 2025


March 31, 2024

Cash flows from operating activities-continuing operations:





Net earnings

$ 994


$ 799

Adjustments to reconcile net earnings to net cash from operating activities:



Depreciation of property, plant and equipment

162


152

Amortization of intangible and finance lease right-of-use assets

61


59

Equity-based compensation expense

34


34

Deferred income tax benefit

(59)


(39)

(Increase) decrease in assets, net of effects of business acquisitions:



Accounts receivable

(317)


(115)

Unbilled receivables

(879)


(519)

Inventories

(92)


(1,011)

Increase (decrease) in liabilities, net of effects of business acquisitions:



Accounts payable

13


100

Customer advances and deposits

13


384

Other, net

(78)


(122)

Net cash used by operating activities

(148)


(278)

Cash flows from investing activities:





Capital expenditures

(142)


(159)

Other, net

12


(23)

Net cash used by investing activities

(130)


(182)

Cash flows from financing activities:





Proceeds from commercial paper, net

1,590


-

Repayment of fixed-rate notes

(750)


-

Dividends paid

(383)


(361)

Purchases of common stock

(600)


(105)

Other, net

(32)


50

Net cash used by financing activities

(175)


(416)

Net cash used by discontinued operations

(2)


(1)

Net decrease in cash and equivalents


(455)


(877)

Cash and equivalents at beginning of period


1,697


1,913

Cash and equivalents at end of period


$ 1,242


$ 1,036

EXHIBIT E

ADDITIONAL FINANCIAL INFORMATION - (UNAUDITED)

DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS


Other Financial Information:



























March 30, 2025


December 31, 2024

Debt-to-equity (a)










43.2 %


39.7 %

Book value per share (b)










$ 82.81


$ 81.61

Shares outstanding










268,396,163


270,340,502



























First Quarter













2025


2024

Income tax payments, net










$ 34


$ 33

Company-sponsored research and development (c)










$ 101


$ 137

Return on sales (d)










8.1 %


7.4 %















Non-GAAP Financial Measures:



























First Quarter













2025


2024

Free cash flow:















Net cash used by operating activities










$ (148)


$ (278)

Capital expenditures










(142)


(159)

Free cash flow (e)










$ (290)


$ (437)



























March 30, 2025


December 31, 2024

Net debt:















Total debt










$ 9,609


$ 8,762

Less cash and equivalents










1,242


1,697

Net debt (f)










$ 8,367


$ 7,065

(a)

Debt-to-equity ratio is calculated as total debt divided by total equity as of the end of the period.


(b)

Book value per share is calculated as total equity divided by total outstanding shares as of the end of the period.


(c)

Includes independent research and development and Aerospace product-development costs.


(d)

Return on sales is calculated as net earnings divided by revenue.


(e)

We define free cash flow as net cash from operating activities less capital expenditures. We believe free cash flow is a useful

measure for investors because it portrays our ability to generate cash from our businesses for purposes such as repaying debt,

funding business acquisitions, repurchasing our common stock and paying dividends. We use free cash flow to assess the

quality of our earnings and as a key performance measure in evaluating management.


(f)

We define net debt as short- and long-term debt (total debt) less cash and equivalents. We believe net debt is a useful measure
for investors because it reflects the borrowings that support our operations and capital deployment strategy. We use net debt as
an important indicator of liquidity and financial position.

EXHIBIT F

BACKLOG - (UNAUDITED)

DOLLARS IN MILLIONS
















Funded


Unfunded


Total

Backlog


Estimated

Potential

Contract Value*


Total

Estimated

Contract Value

First Quarter 2025:























Aerospace












$ 18,171

$ 828

$ 18,999

$ 1,090

$ 20,089

Marine Systems












30,882

7,491

38,373

10,261

48,634

Combat Systems












16,129

799

16,928

8,649

25,577

Technologies












9,751

4,606

14,357

32,670

47,027

Total














$ 74,933


$ 13,724


$ 88,657


$ 52,670


$ 141,327

Fourth Quarter 2024:























Aerospace












$ 18,895

$ 798

$ 19,693

$ 1,132

$ 20,825

Marine Systems












30,530

9,288

39,818

9,560

49,378

Combat Systems












16,142

838

16,980

8,647

25,627

Technologies












9,577

4,529

14,106

34,029

48,135

Total














$ 75,144


$ 15,453


$ 90,597


$ 53,368


$ 143,965

First Quarter 2024:























Aerospace












$ 19,564

$ 981

$ 20,545

$ 305

$ 20,850

Marine Systems












29,711

14,415

44,126

3,749

47,875

Combat Systems












14,923

686

15,609

7,002

22,611

Technologies












8,976

4,478

13,454

29,206

42,660

Total














$ 73,174


$ 20,560


$ 93,734


$ 40,262


$ 133,996

*

The estimated potential contract value includes work awarded on unfunded indefinite delivery, indefinite quantity (IDIQ) contracts and

unexercised options associated with existing firm contracts, including options and other agreements with existing customers to purchase

new aircraft and aircraft services. We recognize options in backlog when the customer exercises the option and establishes a firm order.

For IDIQ contracts, we evaluate the amount of funding we expect to receive and include this amount in our estimated potential contract

value. The actual amount of funding received in the future may be higher or lower than our estimate of potential contract value.

EXHIBIT F-1

BACKLOG - (UNAUDITED)

DOLLARS IN MILLIONS

EXHIBIT F-2

BACKLOG BY SEGMENT - (UNAUDITED)

DOLLARS IN MILLIONS

EXHIBIT G

AEROSPACE SUPPLEMENTAL DATA - (UNAUDITED)

DOLLARS IN MILLIONS










































First Quarter









































2025


2024

Gulfstream Aircraft Deliveries (units):











































Large-cabin aircraft






































30


21

Mid-cabin aircraft






































6


3

Total








































36


24











































Aerospace Book-to-Bill:











































Orders*






































$ 2,361


$ 2,426

Revenue






































3,026


2,084

Book-to-Bill Ratio








































0.8x


1.2x

* Does not include customer defaults, liquidated damages, cancellations, foreign exchange fluctuations and other backlog adjustments.

SOURCE General Dynamics

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