L-3 Communications Holdings Earnings: Here’s How They Beat Wall Street

L-3 Communications Holdings Inc. (NYSE:LLL) delivered a profit and beat Wall Street’s expectations, AND beat the revenue expectation. The revenue beat is a positive sign to shareholders seeking high growth out of the company.

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L-3 Communications Holdings Inc. Earnings Cheat Sheet

Results: Net income decreased -22.63% to $212 million ($2.25 per diluted share) in the quarter versus a net gain of $274 million in the year-earlier quarter.

Revenue: Decreased 11.33% to $3.56 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: L-3 Communications Holdings Inc. reported adjusted net income of $2.25 per share. By that measure, the company beat the mean analyst estimate of $2.12. It beat the average revenue estimate of $3.46 billion.

Quoting Management: “Overall, we had a solid fourth quarter underscored by strong orders, sales and cash flows in spite of the challenges and uncertainty in the U.S. defense budget. Sales increased in our Electronic Systems and AM&M segments, which demonstrates that L-3 is well-positioned and executing our strategy to grow our international and commercial businesses and expand market share,” said Michael T. Strianese, chairman, president and chief executive officer. “For the year, orders grew 7% compared to last year, resulting in a book-to-bill ratio of 1.05x. We ended the quarter with funded backlog of $10.9 billion, up 10% compared to December 2011.”

Key Stats:

Revenue increased 8.44% from $3.28 billion in the previous quarter. Net income increased 10.42% from $192 million in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $1.86 to a profit $1.85. For the current year, the average estimate has moved up from a profit of $7.82 to a profit of $7.89 over the last ninety days.

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(Company fundamentals provided by Xignite Financials.)