NOC - Northrop Grumman Corporation. (NOC) Q1 2024 Earnings Call Transcript

2024-04-25 12:46:03 ET

Northrop Grumman Corporation. (NOC)

Q1 2024 Earnings Conference Call

April 25, 2024, 09:00 AM ET

Company Participants

Todd Ernst - Vice President, Investor Relations

Kathy Warden - Chair, CEO and President

Dave Keffer - CFO

Conference Call Participants

Ronald Epstein - Bank of America

Douglas Harned - Bernstein

Kristine Liwag - Morgan Stanley

Sheila Kahyaoglu - Jefferies

Seth Seifman - JPMorgan

David Strauss - Barclays

Cai von Rumohr - TD Cowen

Robert Stallard - Vertical Research

Peter Skibitski - Alembic Global

Scott Deuschle - Deutsche Bank

Myles Walton - Wolfe Research

Gavin Parsons - UBS

Matthew Akers - Wells Fargo

Jason Gursky - Citi

Peter Arment - Baird

Presentation

Operator

Good day, ladies and gentlemen. Welcome to Northrop Grumman's First Quarter 2024 Conference Call. Today's call is being recorded. My name is Josh, and I will be your operator today. [Operator Instructions] I would now like to turn the call over to your host, Mr. Todd Ernst, Vice President, Investor Relations. Mr. Ernst, please proceed.

Todd Ernst

Thanks, Josh. Good morning and welcome to Northrop Grumman's First Quarter 2024 Conference Call. We'll refer to a presentation that is posted to our IR website this morning. Before we start, matters discussed on today's call, including guidance and outlooks for 2024 and beyond reflect the company's judgment based on information available at the time of this call. They constitute forward-looking statements pursuant to Safe Harbor provisions of federal securities laws. Forward-looking statements involve risks and uncertainties, including those noted in today's press release and our SEC filings. These risks and uncertainties may cause actual company results to differ materially.

Today's call will include non-GAAP financial measures that are reconciled to our GAAP results in our earnings release. And on the call today are Kathy Warden, our Chair, CEO and President; and Dave Keffer, our CFO.

At this time, I'd like to turn the call over to Kathy. Kathy?

Kathy Warden

Thank you, Todd. Good morning, everyone. It's so good to have you joining us today. So earlier this morning, we released our first quarter results. And as you can see, we are off to a strong start to the year with broad-based growth across our portfolio. The team's relentless execution of our strategy, which includes technology leadership aligned to our customers' priorities and a laser focus on performance, has positioned us for continued success.

Growing global demand for our capabilities led to an exceptional 9% year-over-year increase in Q1 sales, driven by growth in all four of our sectors. The productivity and cost efficiency measures we've been implementing are gaining traction, and our program performance in the quarter was strong resulting in segment operating margin dollars increasing by 10%.

Operating profit expansion along with the lower share count helped to drive 15% EPS growth. Overall, our first quarter performance was in line with, or better than our expectations, and we are reaffirming our 2024 company level guidance. Global demand for our products continues to be robust, fueled by rising defense budgets and our market position. We're pleased that an agreement was reached on the U.S. fiscal year 2024 defense budget, which includes support for our key programs, and represents a 6% growth in investment accounts over 2023....

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