Losing Britain’s nuclear weapons business took a small bite out of Lockheed Martin’s 2021 earnings, which fell overall for the year, despite underlying signs of strength in operations, the company reported this week.
Despite the renationalization of the United Kingdom’s nuclear-weapons complex in July 2021, segment sales and operating profits at Lockheed’s Space segment — where the company bookkept revenue from the now-displaced AWE Management Ltd. that ran the complex under contract — were down only a blip overall, respectively falling $66 million, or half a percent, and $15 million, or just under 1.5%.
Space had $885 million worth of sales from AWE Ltd. in 2021, down from $1.4 billion in 2020, the last full year the U.K.’s nuclear complex was under contract management. Segment operating profit attributable to AWE Ltd. was $18 million, down from $35 million in 2020, Lockheed wrote in its latest 10-K filing.
Jacobs Engineering, Dallas, led AWE Ltd., which also included Britain’s Serco Group. The U.K. government made its Atomic Weapons Establishment into an arms-length body controlled by the country’s Ministry of Defence through the new AWE PLC. Former oil and gas executive Sir John Manzoni was the new management entity’s first board chair.
Overall, Lockheed posted net earnings of roughly $6.3 billion, or $22.76 a share, down from more than $6.8 billion, or $24.30 a share in 2020. Operating profit, which typically excludes expenses that are purely financial in order to show the health of underlying operations, increased to more than $9 billion from more than $8.5 billion in 2020, Lockheed said.
Lockheed’s latest earnings cycle also made headline news this week because of the disclosure that the Federal Trade Commission had sued to block the company’s planned acquisition of Aerojet Rocketdyne, one of the two remaining domestic suppliers of solid rocket motors to the U.S. military.
The Lockheed-made, nuclear-tipped Trident II D5 intercontinental ballistic missiles carried aboard Ohio-class ballistic submarines include first- and second-stage solid rocket motors made by Alliant Techsystems, long since rolled up into Northrop Grumman, now the government’s main alternative to Aerojet Rocketdyne.
The administrative trial for the Federal Trade Commission’s lawsuit was scheduled for June 16.
Lockheed, meanwhile, has stayed active elsewhere in the nuclear arsenal, hooking on as part of a team to build the Ground Based Strategic Deterrent (GBSD) intercontinental missiles that Northrop will prime and, more recently, maintaining its hold on a sole-source contract from the Air Force to service the Weapon System Control Console line replacement units used in the launch centers that control the Boeing-built Minuteman III missiles that GBSD was scheduled to replace beginning in 2030 or so.
