Slide 1: Lockheed Martin Corporation 3rd Quarter 2023 Conference Call
JAMES D. TAICLET Chairman, President and CEO JAY MALAVE Chief Financial Officer Lockheed Martin Corporation 3rd Quarter 2023 Conference Call October 17, 2023 Webcast login at: www.lockheedmartin.com/investor Webcast replay & podcast available by 2:00 p.m. ET October 17, 2023 at: www.lockheedmartin.c
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains statements that, to the extent they are not recitations of historical fact, constitute forward-looking statements within the meaning of the federal securities laws, and are based on Lockheed Martin’s current expectations and assumptions. The word
Slide 3: 3Q 2023 Results: Strong Financial Results
3Q 2023 Results Strong Financial Results $16.9B $1.8B In Sales Segment Operating Profit* 10.7% $6.73 0.9x Segment Operating Margin* Earnings Per Share Book-to-Bill Ratio* $2.5B $1.8B $0.7B $0.7B Delivered in Free Cash Flow* Of Share Repurchases In Dividends Of Independent Research & Returns to Share
Slide 4: 3Q 2023 Results: Sales and Segment Operating Profit
3Q 2023 Results Sales ($M) Segment Operating Profit* ($M) $1,918 $16,583 $16,878 $1,810 11.6% 10.7% +2% (6%) YoY YoY 3Q 2022 3Q 2023 3Q 2022 3Q 2023 Top-Line Growth Continued with Lower Net Profit Adjustments *See Charts 14 and 15 for Definitions of Non-GAAP Measures 3Q Earnings Results Conference C
Slide 5: 3Q 2023 Earnings Per Share (EPS) Comparison
3Q 2023 Earnings Per Share (EPS) Comparison $6.87 $6.77 $0.16 $0.04 $6.71 $6.73 YoY Drivers (-) Segment Profit (Net Profit Adjustments) Adjusted EPS* (-) Interest Expense, Net GAAP EPS (+) Share Count (+) Mark-to-Market (+) Tax Rate / Other 3Q 2022 3Q 2023 Lower Segment Operating Profit Offset by Be
Slide 6: Cash Returned to Shareholders
Cash Returned to Shareholders 3rd Quarter 2023 Year-to-Date 2023 $5,289 $2,527 $2,497 $4,568 $747 $2,289 Dividends Dividends 116% 99% $1,750 $3,000 Share Share Repurchases Repurchases Free Cash Flow* Cash Returned Free Cash Flow* Cash Returned Sustained Capital Deployment *See Charts 14 and 15 for D
Slide 7: Aeronautics
Aeronautics Sales ($M) Segment Operating Profit* ($M) $7,089 $759 $6,717 $671 10.7% 10.0% 3Q 2022 3Q 2023 3Q 2022 3Q 2023 *See Charts 14 and 15 for Definitions of Non-GAAP Measures 3Q 2023 Drivers Sales: Decreased 5% YoY Operating Profit: Decreased 12% YoY Lower Volume on F-35, driven by Lower Volum
Slide 8: Missiles and Fire Control
Missiles and Fire Control Sales ($M) Segment Operating Profit* ($M) $2,939 $383 $398 $2,831 13.5% 13.5% 3Q 2022 3Q 2023 3Q 2022 3Q 2023 *See Charts 14 and 15 for Definitions of Non-GAAP Measures 3Q 2023 Drivers Sales: Increased 4% YoY Operating Profit: Increased 4% YoY Higher Volume at TSM Higher Ne
Slide 9: Rotary and Mission Systems
Rotary and Mission Systems Sales ($M) Segment Operating Profit* ($M) $4,121 $472 $482 $3,781 12.5% 11.7% 3Q 2022 3Q 2023 3Q 2022 3Q 2023 *See Charts 14 and 15 for Definitions of Non-GAAP Measures 3Q 2023 Drivers Sales: Increased 9% YoY Operating Profit: Increased 2% YoY Higher Volume at IWSS Higher
Slide 10: Space
Space Sales ($M) Segment Operating Profit* ($M) $3,101 $2,882 $304 $259 10.5% 8.4% 3Q 2022 3Q 2023 3Q 2022 3Q 2023 *See Charts 14 and 15 for Definitions of Non-GAAP Measures 3Q 2023 Drivers Sales: Increased 8% YoY Operating Profit: Decreased 15% YoY Higher Volume on NGI, FBM, Higher Volume Offset by
Slide 11: 2023 Outlook
2023 Outlook ($M), Except for EPS July Outlook October Outlook Sales $66,250 - $66,750 $66,250 - $66,750 Segment Operating Profit* $7,325 - $7,375 $7,325 - $7,375 Total FAS / CAS Pension Adjustment ~$2,100 ~$2,100 Diluted EPS ~$27.00 - $27.20 ~$27.00 - $27.20 Cash From Operations ≥ $8,150 ~ $8,150 C
Slide 12: Summary
Summary • Delivering Solid Year-to-Date Performance • Driving Linearity Through Better Operational Performance • Generating Strong Free Cash Flow with Focus on Working Capital • Maintaining Full Year Outlook for Sales, Profit, EPS and Cash • Increasing Cash Deployment to Shareholders • Executing 21s
Slide 13: Lockheed Martin
LOCKHEED MARTINZ
Slide 14: Definitions of Non-GAAP Measures
Definitions of Non-GAAP Measures Non-GAAP Financial Measures Disclosure This presentation, and today’s conference call remarks, contain non-Generally Accepted Accounting Principles (GAAP) financial measures (as defined by SEC Regulation G). While management believes that these non-GAAP financial mea
Slide 15: Definitions of Non-GAAP Measures
. Definitions of Non-GAAP Measures Adjusted Earnings Per Share (non-GAAP) Diluted earnings per share (EPS) was impacted by certain non-operational charges for all periods. Management believes the presentation of this measure adjusted for the impacts of these non-operational items is useful to invest
Slide 16: Appendix I: July and October 2023 Outlook
Appendix I July 2023 Outlook October 2023 Outlook Sales ~$66,250 – 66,750 ~$66,250 – 66,750 Segment Operating Profit* ~$7,325 – 7,375 ~$7,325 – 7,375 Segment Margin ~11.1% ~11.1% FAS/CAS Operating Adjustment** ~$1,660 ~$1,660 Other, net ~($585) ~($585) Consolidated Operating Profit ~$8,400 – 8,450 ~
Slide 17: Appendix II: Segment Outlook
Appendix II July October 2023 Outlook 2023 Outlook ($M) ($M) Segment Segment Sales Sales Operating Profit* Operating Profit* AERO $26,800 – 27,000 $2,805 – 2,825 AERO $26,800 – 27,000 $2,805 – 2,825 MFC 11,200 – 11,300 1,515 – 1,525 MFC 11,200 – 11,300 1,515 – 1,525 RMS 15,900 – 16,000 1,890 – 1,900
Slide 18: Appendix III: Outlook Total FAS income (expense) and CAS costs
Appendix III 2023 Outlook Total FAS income (expense) and CAS costs FAS pension income ~ $ 375 Less: CAS pension cost ~ 1,725 Total FAS/CAS pension adjustment ~ $ 2,100 Service and non-service cost reconciliation FAS pension service cost ~ $ (65) Less: CAS pension cost ~ 1,725 FAS/CAS operating adjus