(from www.sec.gov)
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General Dynamics Corp. |
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From the April 28, 1997 Washington Post
| '96 (in $ 000s) | % Change From '95 | |
| Revenue | 3,580,000 | 16.7 |
| Net Income | 270,000 | 9.3 |
Description:
General Dynamics builds ships and submarines for the U.S. Navy, as well as tanks for the U.S. Army and some foreign customers. The company also makes some electronic components for armored vehicles sold to foreign governments.
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Even though Pentagon budgets are essentially flat or declining in General Dynamics' business areas, the company has found a way to bolster sales—by buying other defense businesses. It also has been victorious in several key contract competitions.
General Dynamics was once the defense industry's leader in unloading businesses. From 1991 to 1995, it sold more than five divisions that made fighter jets, rockets, missiles and the like. Then in 1995 it reversed its strategy by buying the Bath Iron Works shipyard in Maine. Last year it acquired a business that makes tank engines from Teledyne Inc., and bought portions of Lockheed Martin Corp. that make tank electronics equipment.
The stock market applauded these purchases—General Dynamics' stock rose 20 percent last year. One reason is that the new divisions are helping the firm win new business.
In December Bath Iron Works won a contract that could be worth as much as $6 billion to build up to 12 amphibious assault ships for the Navy. Earlier in the year, General Dynamics won a Marine Corps competition worth up to $8 billion to build a new amphibious assault vehicle for landing marines ashore.
Only weeks into 1997, the company won the first round of bidding to build a new type of highly automated craft called the Arsenal Ship, which would bristle with missiles but have a crew of only a few dozen. The company started 1997 with $700 million in cash, no debt and a lingering hunger to buy yet more defense properties.
It will be assisted in that search by a series of decisions by a federal judge last year that means the company will receive approximately $750 million in legal judgments. The decisions came in a lawsuit the firm filed against the federal government in connection with the Pentagon's cancellation of the A-12 jet in 1991. The company will have to wait about two years before it gets its money, though.
