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While the novel coronavirus may have taken a heavy toll on the U.S. economy and businesses from coast to coast, the essential work of military contracting has proved COVID-proof for America’s largest contractor, Lockheed Martin, which saw an increase in sales measured in the billions for 2020. And the company expects even better in 2021.
Lockheed Martin, the company that supplies everything from laser weapons for the Navy to the trillion-plus-dollar international F-35 program, did approximately $65.4 billion in net sales in 2020, up from just under $60 billion the year before, according to an earnings report released today. The company saw over $8.6 billion in “consolidated operating profit” for 2020.
The future, the company says, looks brighter. The company’s 2021 financial outlook predicts net sales between $67.1 and $68.5 billion.
In the report Lockheed president and CEO James Taiclet, a former Air Force pilot, said that throughout 2020, “the men and women of Lockheed Martin overcame the public health, operational and supply chain challenges caused by the COVID-19 pandemic, and continued to deliver the platforms, systems, and services essential to the national defense of the U.S. and its allies and to the continuation of scientific discovery.”
Later the report especially credits Lockheed’s work with the government to protect supply chains with helping to mitigate “disruptions caused by COVID-19.” It also cautioned that its rosy future outlook depends on having no major disruptions to operations next year.
RELATED: A Thriving Pandemic Business: Selling Billions in Weapons Abroad
The company’s biggest sales bump came in the aeronautics industry, which saw an increase of around $2.5 billion in net sales from 2019. Lockheed credited major deals involving the F-16 and F-35 programs, as well as a cool $125 million it credited to the “higher volume on classified development contracts.”
[Editor’s Note: These figures are astronomical and sometimes hard to really wrap your head around. So, for reference, to make $1 billion, an elementary or middle school teacher in the U.S. would have to work for approximately 15,700 years at their current average yearly salary — not including taxes. $8.6 billion, Lockheed’s consolidated operating profit for 2020, is more than the GDP of 65 nations.]
Lockheed is America’s biggest defense contractor, according to Bloomberg, followed by other giants like Boeing, General Dynamics, Raytheon on Northrop Grumman. Raytheon also announced its final 2020 results today, and it saw an even larger increase in net sales than Lockheed: up to $56.6 billion in 2020 compared to $45.3 billion in 2019 — a jump of more than $11 billion. The other major contractors are scheduled to announce their 2020 earnings later this week.
Early in the pandemic the Department of Defense declared military contractors as essential workers — presumably including most if not all of the approximately 11,000 Lockheed employees worldwide.
“If your efforts support manning, training, equipping, deploying, or supporting our military forces, your work is considered Essential Critical Infrastructure,” a defense official wrote to contractors in March 2020 (PDF). “We need your support and dedication in these trying times to ensure the security of this Nation.”
PRIMARY SOURCE: Lockheed Martin Reports Fourth Quarter And Full Year 2020 Results (LockheedMartin.com)
PRIMARY SOURCE: Raytheon Technologies Reports Fourth Quarter 2020 Results, Announces 2021 Outlook (RTX.com)
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