October 25, 2018 / 10:55 AM / 20 days ago

Raytheon third-quarter profit beats, raises full-year forecasts

Oct 25 (Reuters) - Tomahawk missile maker Raytheon Co beat analysts' estimates for third-quarter profit on Thursday, driven by higher sales at two of its biggest businesses and lower taxes, helping the company raise its 2018 profit and sales forecasts.

The results come as Raytheon and other U.S. weapons makers are expected to gain from higher defense spending under President Donald Trump's administration and stronger global demand for fighter jets and tanks.

Sales at Raytheon's missile systems unit, its biggest by revenue, rose 7 percent to about $2.08 billion in the reported quarter.

However, operating margin for the unit — which makes weapons including medium-range air-to-air missiles, Paveway laser-guided bombs and SM-3 anti-ballistic missiles — fell 210 basis points to 12.3 percent.

Sales at the company's intelligence, information and services business, its second biggest, rose 13 percent to $1.74 billion, driven by higher revenue from various programs, including DOMino, which provides cybersecurity support to the U.S Department of Homeland Security.

Operating margin for the unit increased 130 basis points to 8.6 percent.

The Waltham, Massachusetts-based company now expects 2018 earnings from continuing operations to be between $10.01 and $10.11 per share, up from its previous forecast of $9.77 to $9.97 per share.

Raytheon also forecast annual sales between $27 billion and $27.3 billion, higher than its prior expectation of $26.7 billion to $27.2 billion.

Income from continuing operations attributable to the company rose 12.4 percent to $644 million, or $2.25 per share, in the third quarter ending Sept. 30, beating Refinitiv estimates of $1.98.

Overall sales rose 8.3 percent to $6.81 billion, topping estimates of $6.70 billion. (Reporting by Mike Stone in Washington and Ankit Ajmera in Bengaluru; Editing by Shounak Dasgupta)

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