Revenue Analysis
Total and Operating Revenue: LHX’s total revenue has shown fluctuations over the periods reported. From 2023-06-30 to 2024-03-31, the revenue increased from $4.69 billion to $5.21 billion, indicating growth. However, there is a slight decrease observed from $5.34 billion in 2023-12-31 to $5.21 billion in 2024-03-31.
Gross Profit Margin: Gross Profit has grown from $1.17 billion in 2023-06-30 to $1.35 billion in 2024-03-31, demonstrating an improvement in profitability and potentially efficient cost management.
Cost Management
Cost of Revenue: The cost of revenue notably grew from $3.48 billion on 2023-06-30 to $3.86 billion by 2024-03-31, maintaining a proportional relationship with revenue growth, which supports stable gross margins.
Operating Expense: Operating expenses showed a significant increase from $706 million in 2023-06-30 to $970 million in 2024-03-31, potentially reflecting increased operational activities or investments in new business areas.
Total Expenses: Total expenses have risen overall from $4.18 billion in 2023-06-30 to $4.83 billion in 2024-03-31 which aligns with the general growth trend in revenue and cost of revenue.
Profitability Analysis
EBITDA: EBITDA improved from $739 million in 2023-06-30 to $786 million by 2024-03-31, showing enhanced earnings before interest, taxes, depreciation, and amortization.
Operating Income: There was an increase in operating income from $393 million in 2023-06-30 to $378 million in 2024-03-31, though there was a peak at $479 million in 2023-09-30.
Pretax Income: Pretax income displayed growth from $372 million in 2023-06-30 to $290 million in 2024-03-31, despite some fluctuations over the periods.
Net Income: Net income showed varied trends but was $283 million in 2024-03-31, compared to $349 million in 2023-06-30. This decrease could reflect differing tax implications and operational costs.
Cash Flow Indicators
Reconciled Depreciation: Depreciation expenses increased from $256 million in 2023-06-30 to $320 million by 2024-03-31, showing higher capital asset expenses.
Interest Expense: Interest expenses remained fairly stable, showing $111 million in 2023-06-30 and rising slightly to $176 million by 2024-03-31.
Taxation
Tax Rate: The tax rate showcased variations, being 5.6% in 2023-06-30 and minimally adjusting to a lower rate of 1.7% by 2024-03-31.
Tax Provision: Tax provision was $21 million in 2023-06-30, and a minimal provision of $5 million by 2024-03-31, which reflects efficient tax management strategies.
Tax Effect of Unusual Items: There was a significant tax effect due to unusual items, like -$114.87 million recorded in 2023-12-31, which significantly impacted the financial results.
Shareholder Metrics
Diluted and Basic EPS: Earnings per share (EPS) showed an overall declining trend with $1.83 in 2023-06-30 diluted EPS, down to $1.48 by 2024-03-31.
Average Shares: The number of shares outstanding slightly decreased from 190.1 million in 2023-06-30 to 190.8 million by 2024-03-31.
Net Income Available to Common Stockholders: This metric remained steady at $283 million in 2024-03-31 compared to previous quarters.
Conclusion
The analysis indicates LHX has managed to grow revenue and maintain a stable cost of revenue ratio which contributes to improved gross profit. Despite growth in operational expenses and variable tax effects, the company managed to sustain profitability. Recommendation includes continued focus on operational efficiency and possibly expanding revenue streams to maintain competitiveness and profitability.