Lockheed Profits Set Record in 2nd Quarter

Lockheed Corp. reported Friday that it earned a record $87 million in the second quarter, an 11.5% increase from the $78 million earned in the year earlier, which represented a slight erosion of profit margins compared to last year.

“Profit margins are experiencing some pressure,” Lockheed Chairman Roy Anderson said, “because of increased spending for company-sponsored research and development and low margins on some foreign service contracts and some U.S. government programs that are in early development.”

Lockheed revenue in the quarter was $2.2 billion, up 15.8% from $1.9 billion last year.

Anderson said he expects sales and earnings to show good gains over the 1984’s record results.

The second-quarter gains were led by the firm’s missiles, space and electronics group, which posted program profits of $68.9 million, up 17.7% from last year.

Sales were $1.27 billion, up from $907 million.

Aeronautical profits were up 4.3% to $90.7 million on slightly lower sales of $851.2 million. Last year’s sales were $900.8 million.

Profits were down sharply at the firm’s shipyard, which is phasing out production of the Navy’s landing ship dock program. It posted program profits of $2.3 million, down from $6.3 million last year.

The information systems group earned only $600,000, down from $2.7 million, because of heavy new-product investments, the company said.

Lockheed’s funded backlog at June 30 was $8.3 billion, compared to $9.4 billion at the end of 1984.

Not included in the funded backlog at the end of the quarter were programs under contract with the U.S. and foreign governments valued at $12.4 billion.