facebook
twitter
rss
account
search
search
 

Deloitte details defense sector revenue

March 20, 2013 at 1:33 PM   |   Comments

NEW YORK, March 20 (UPI) -- A new report from Deloitte, the business consulting firm, said that U.S. defense sector revenues dipped 1.5 percent in 2012 and earnings fell 7.4 percent.

Assuming that the $46 billion in annual defense cuts mandated under the government's "sequestration" will be proportional and remains in force, it is estimated that up to another 12 percent, or $25 billion, of defense and government contractor budgets "are likely to be impacted for a combined total of approximately 24 percent in reductions."

"With U.S. defense budgets being cut, defense contractors are likely to experience continued revenue declines, and in some cases accelerated revenue declines," said Tom Captain, vice chairman, Deloitte LLP and aerospace and defense sector leader. "It's expected that U.S. defense contractors will aggressively address this revenue shortfall with foreign military sales, acquisitions, new product introductions and growth in adjacent markets."

Deloitte said that while defense sector business dropped last year, the commercial aerospace sector continued double-digit growth. Its revenues grew by 18.3 percent and earnings jumped 13.2 percent.

"Overall, the top 20 U.S. A&D companies' revenues increased 5.5 percent to $354.7 billion, primarily driven by record-setting commercial aircraft production, which offset the negative revenue decline within the defense sub-sector," it said. "Overall operating earnings decreased 2.2 percent to $36.0 billion due to the impact of slowing defense spending."

© 2013 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
Most Popular
1
New Navy sub ready for outfitting, testing New Navy sub ready for outfitting, testing
2
New F-35 sustainment system undergoing flight testing New F-35 sustainment system undergoing flight testing
3
Scrap South Stream, Europe says Scrap South Stream, Europe says
4
Apple to authorities: No iPhone user data, even with a warrant Apple to authorities: No iPhone user data, even with a warrant
5
Home Depot says 56M credit, debit cards compromised Home Depot says 56M credit, debit cards compromised
Trending News
Video
x
Feedback