General Dynamics, Northrop Grumman: Flattish Revenue but Growing Order Book

• General Dynamics had basically flat Q3 2014 revenue, with total sales of $7.7B, masking a 13% drop in information systems balanced by growth of about 7% in aerospace, combat systems, and marine systems. Their total backlog reached $74.4B and has been robustly growing throughout the year, though most of that growth is unfunded.

• Like Lockheed Martin, Northrop Grumman’s Q3 sales dropped by 2% YoY to $5.9B. However their total backlog grew by 8% to $38.5B thanks to $9B in new awards (a 150% book-to-bill ratio) led by the E-2D Hawkeye.

• Raytheon’s Q3 sales declined more, with a 6.3% drop to $5.5B. That’s mitigated by $5.9B in bookings, a 1.07 book-to-bill ratio. That takes the backlog to $33.2B, one billion dollars more than a year ago.

• Boeing’s Q3 sales [PDF] grew by 7.7% to $23.8B, again thanks to commercial aircraft as Defense, Space and Security’s revenue slightly declined by $100M to $7.9B, with book-to-bill barely above 50%, and a $60B backlog for the division, or less than 15% of the company’s total backlog.

• For perspective, Apple’s free cash flow for the same quarter was $9.3B, more than what defense primes pull in *revenue*, an an order of magnitude more than their free cash flow.

• The US Air Force released a draft RFP [FBO] for the development and production of its Advanced Radar Threat System Variant 2 (ARTS-V2), a “pre-Milestone B Program to develop and field a high fidelity threat emitter for live aircrew training for anti-access/area denial environments.” They will hold an industry day on Nov. 19 at Hill AFB, UT.

• Intelsat was awarded a contract by the USAF to study the commercialization of its Satellite Control Network which could help lower costs.