WALTHAM, Mass. - Raytheon announced net sales for the first quarter 2017 of $6.0 billion, up 3.4 percent compared to $5.8 billion in the first quarter 2016. Net income for the quarter was $506 million compared to $428 million in the same period a year prior.
"Solid revenue growth and margin expansion drove strong earnings per share performance in the first quarter, with all of our businesses meeting or exceeding expectations," said Thomas A. Kennedy, Raytheon Chairman and CEO. "Our focus on global growth and operational excellence, combined with our balanced capital deployment strategy, continues to create value for our customers and shareholders."
Backlog was $36.0 billion at the end of the quarter compared to $36.7 billion at year end 2016.
INDUSTRY SEGMENTS
Integrated Defense Systems
Integrated Defense Systems (IDS) had first quarter 2017 net sales of $1,398 million, up 5 percent compared to $1,336 million in the first quarter 2016. The increase in net sales for the quarter was primarily driven by higher net sales on an international early warning radar program awarded in the first quarter 2017.
IDS recorded $212 million of operating income in the first quarter 2017 compared to $146 million in the first quarter 2016. The increase in operating income for the quarter was primarily driven by higher net program efficiencies and a favorable change in program mix. The first quarter 2016 included a $36 million unfavorable program adjustment.
During the quarter, IDS booked $987 million for the Upgraded Early Warning Radar (UEWR) system for Qatar. IDS also booked $220 million to provide Patriot engineering services support for U.S. and international customers.
Intelligence, Information and Services
Intelligence, Information and Services (IIS) had first quarter 2017 net sales of $1,507 million compared to $1,532 million in the first quarter 2016. As expected, the change in net sales for the quarter was primarily driven by lower net sales on an international classified program.
IIS recorded $111 million of operating income in the first quarter 2017 compared to $104 million in the first quarter 2016. The increase in operating income for the quarter was primarily driven by a favorable change in program mix.
During the quarter, IIS booked approximately $930 million on U.S. Air Force programs. IIS also booked $390 million on a number of classified contracts.
Missile Systems
Missile Systems (MS) had first quarter 2017 net sales of $1,756 million compared to $1,723 million in the first quarter 2016.
MS recorded $216 million of operating income in the first quarter 2017 compared to $192 million in the first quarter 2016. The increase in operating income for the quarter was primarily due to a favorable change in program mix.
During the quarter, MS booked $203 million for AIM-9X Sidewinder short-range air-to-air missiles for the U.S. and international customers and $159 million for Paveway for international customers.
Space and Airborne Systems
Space and Airborne Systems (SAS) had first quarter 2017 net sales of $1,555 million, up 8 percent compared to $1,445 million in the first quarter 2016. The increase in net sales for the quarter was primarily driven by higher net sales on an electronic warfare systems program.
SAS recorded $190 million of operating income in the first quarter 2017 compared to $167 million in the first quarter 2016. The increase in operating income for the quarter was primarily driven by a favorable change in program mix and higher volume.
During the quarter, SAS booked $256 million for Active Electronically Scanned Array (AESA) radars for the U.S. Air Force, and $250 million on two contracts for international customers, one for military processors and one for radar warning receivers. SAS also booked $402 million on a number of classified contracts.
Forcepoint
Forcepoint had first quarter 2017 net sales of $144 million, up 4 percent compared to $139 million in the first quarter 2016. Forcepoint recorded $16 million of operating income in the first quarter 2017 compared to $18 million in the first quarter 2016.
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