Defense Breakdown: Raytheon Company (RTN), General Dynamics Corporation (NGD), United Technologies Corporation (UTX)

Page 1 of 2

Sequestration budget cuts have already started slashing into the U.S. defense budget and unprepared defense contracts are soon going to start feeling the pain.

This article sets out the geographical split of revenues across four major U.S. government defense contractors. The purpose of this is to highlight players in the defense sector within the U.S., analyzing each company to establish if they have diversified outside of the U.S. enough to be protected from some of the spending cuts.

Raytheon Company (NYSE:RTN)

General Dynamics Corporation (NYSE:GD)

Division Revenue Year-Over-Year Change
Geographical Split — Revenue 2012
United States $25,004 -79.30%
Rest of the World $1,240 -3.90%
United Kingdom $1,027 -3.30%
Canada $878 -2.80%
China $876 -2.80%
Other $2,488 -7.90%

Figures in millions.

General Dynamics Corporation (NYSE:GD)’ adjusted 2012 full-year earnings from continuing operations were $2.3 billion. On a GAAP basis, the company reported a loss from continuing operations of $332 million.

During the fourth quarter, it recorded a $2 billion goodwill impairment related to its Information Systems and Technology group, which is one of the reasons that the company reported a GAAP loss. It also recorded $867 million in other charges in the quarter.

Unfortunately, the overwhelming majority (79%) of General Dynamics’ 2012 revenue is from defense spending in the U.S., with only 3% coming from the faster-growing Chinese market and a combined 21% for the rest of the world.

It should be noted that the 80% fall in revenues from U.S. operations is for the most part related to the company’s goodwill impairment and other charges. That said, General Dynamics Corporation (NYSE:GD) has very little diversification outside of the U.S., making it highly susceptible to spending cuts.

Raytheon Company (NYSE:RTN)

Divisional Split — Revenue 2012
Integrated Defense Systems $5,037 -19.10%
Intelligence & Information Systems $3,012 -11.40%
Missile Systems $5,693 -21.60%
Network Centric Systems $4,058 -15.40%
Space & Airborne Systems $5,333 -20.20%
Technical Services $3,239 -12.30%
Geographical Split — Revenue 2012
Asia Pacific $2,510 -10.30%
Europe $1,252 -5.10%
Middle East $2,470 -10.10%
United States $18,182 -74.50%

Figures in millions.

Like General Dynamics Corporation (NYSE:GD), Raytheon Company (NYSE:RTN) does most of its business in the U.S. However, unlike General Dynamics, Raytheon does about a quarter of its business outside the U.S.

Seventy-five percent of Raytheon’s 2012 revenue was from the U.S., 10% from Asia-Pacific, 10% from the Middle East, and 5% from Europe.

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

The Top 10 States With Fastest Internet Speeds

10 Best Places to Visit in USA in August

Top 10 Cities to Visit Before You Die

Top 10 Genetically Modified Food In the US

15 Highest Grossing Movies Opening Weekend

5 Best Poker Books For Beginners

10 Strategies Hedge Funds Use to Make Huge Returns

Top 10 Fast Food Franchises to Buy

10 Best Places to Visit in Canada

Best Summer Jobs for Teachers

10 Youngest Hedge Fund Billionaires

Top 10 One Hit Wonders of the 90s

Fastest Growing Cities In America

Top 10 U.S. Cities for Freelancers

Top 9 Most Popular Free iPhone Apps

Top 10 Least Expensive Private Business Schools in the US

Top 15 Most Expensive Countries in the World – 2014

Top Businesses to Invest In

Top 5 Things You Might Be Doing Wrong With Your Business

Top 5 Strategic Technology Trends in 2014

Top Rags to Riches Stories

Parenting Behavior That Promotes Future Leaders

Top 5 Mistakes Made by Small Businesses

Top 5 Most Common and Potentially Devastating Financial Blunders

Top 5 Highest Paying Jobs for Web Designers

Top 6 Most Respected Professions that Also Pay Well

Top 5 Pitfalls Investors Should Avoid

Top 6 Lawyers and Policy Makers Under 30

Top 6 New Year’s Resolutions for Entrepreneurs

Top 7 Locations to Check in on Facebook

Top 5 Mistakes made by Rookie eBay Sellers

Top 7 eBook Publishers in 2013

Top 6 Health Industry Trends in 2014

5 Lessons for Entrepreneurs from Seth Godin

Top 5 Success Tips from Jordan Belfort – the Wolf of Wall Street

Best Master’s in Finance Degree Programs

Top 6 Earning Celebrities Over 50

The most expensive sports to play

Top 7 Earning Celebrities Under 25

Best 7 Online Courses to Take: Free Finance MOOCs

Top 6 Bad Habits that Promote Failure

20 Most Valuable Soccer Teams in the World in 2013

12 Most Expensive Countries for Foreign Students

Top 30 Most Influential Women in the World

Top 20 Most Expensive New Year Eve Shows

Top 5 Best Vocational Careers

Top 10 Jobs for 2014 by Salary Gain (Predictions)

Top 5 Digital Trends for 2014

Top 6 Things You Can Do To Increase Your Productivity

Top 9 Trending Smartphones in 2013

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!