Orion, Classified Work Lift Lockheed Space Sales
PARIS — Delivery of a classified satellite valued at nearly $400 million late in the year helped increase Lockheed Martin’s satellite revenue by nearly 14 percent, to $5.8 billion, in 2009 despite a drop in commercial satellite sales, Lockheed Martin said Feb. 25.
In a filing with the U.S. Securities and Exchange Commission (SEC), the Bethesda, Md.-based company said its Space Transportation business also increased in 2009, rising by $21 million, to $1.38 billion. Revenue from the Orion Crew Exploration Vehicle — now slated for cancellation under NASA’s 2011 budget proposal — offset a decline in business for the Lockheed Martin-built external fuel tank for the U.S. space shuttle.
The Space Transportation division conducted one commercial Atlas 5 launch in 2009, valued at about $100 million, and one in 2008.
Revenue at the company’s Space and Defensive Missiles business declined by $102 million in 2009, to about $1.47 billion, as growth in the strategic-missile product line was more than offset by declines in the defensive missile segment.
The three divisions together make up the company’s Space Systems business, which increased its revenue by 7.8 percent, to $8.65 billion, in 2009 compared to 2008. The division’s operating profit, at $972 million, was 11.2 percent of revenue.
Lockheed Martin Chief Financial Officer Bruce Tanner said during a Jan. 28 conference call with investors that increased work on the U.S. Air Force’s Advanced EHF military telecommunications satellites and high revenue from existing classified satellite programs will not be enough to permit the Space Systems division in 2010 to match the performance in 2009.
Lockheed Martin books revenue at program delivery. Tanner said the classified satellite program completed in late 2009 had been viewed as a possible early-2010 delivery, which is why the company had not included it in previous 2009 revenue forecasts. The company delivered just one commercial satellite in 2009, compared to two in 2008.
The company is forecasting that its Space Systems business will report revenue of between $8.25 billion and $8.5 billion in 2010, with an operating profit of between $905 million and $930 million.
Lockheed Martin announced in August that it would be reducing its Space Systems work force by 800 people, or 4.5 percent, by the end of the year to adjust for a forecasted decline in business, with the cuts occurring mainly at its Sunnyvale, Calif., and Denver facilities.
A separate work force reduction program had already begun at NASA’s Michoud Assembly Facility near New Orleans, where space shuttle external tanks are produced. The shuttle is scheduled to be retired late this year.
The company has not announced specific headcount consequences if NASA’s proposal to cancel the Orion crew vehicle is confirmed by the U.S. Congress.