Harris Delivers Solid Results; Initiates Fiscal 2018 Guidance
Technology communications and defense provider Harris Corp. (NYSE: HRS – $115.94) reported revenue in the fourth quarter of $1.54 billion compared with an adjusted $1.53 billion in the prior year and slightly exceeding analysts’ views. Adjusted income from continuing operations was $183 million, or $1.49 per share, compared with $1.30 per share in the prior year period and in line with expectations. Orders for the fourth quarter were $1.57 billion. Income from continuing operations for the fiscal 2017 full-year period was $689 million, or $5.53 per share, compared with $645 million, or $5.14/share last year. Sales of communication and electronics systems rose in the period as the company won more government contracts, even as revenue from space and intelligence systems dropped slightly. Specifically, revenue in the Communication Systems group was up 3%; the Electronic Systems segment was higher by 4% compared to last year’s fourth quarter; and the Space and Intelligence business was lower by 4%. During the year, Harris sold non-core businesses including an IT service to focus on “technology-differentiated, high-margin” units.
In a statement by management, Melbourne, Florida-based Harris is looking to “return to growth in fiscal 2018”. Initial guidance for the current year is for income from continuing operations in a range of $5.85 – $6.05 per share with revenue in the range of $6.02 – $6.14 billion, up 2 – 4 percent from fiscal 2017 and expects fiscal 2018 free cash flow in a range of $850 – 900 million. The shares are closing in on its previous 52-week high of $116.49 set back in June and can be held for further long-term appreciation and moderate income.