WASHINGTON (dpa-AFX) - Shares of Harris Corp. (HRS) Thursday slipped seven percent in extended trade after detailing a weak outlook for the third quarter and lowered its full year guidance, due to delays in tactical radio procurements.
For the third quarter, Harris expects income from continuing operations to be about $1.12 per share, with revenues of about $1.20 billion.
Analysts polled by Thomson Reuters currently estimate earnings of $1.26 per share on revenues of $1.32 billion for the quarter. Analysts estimates typically exclude one-time items.
The Melbourne, Florida-based military contractor said its weaker-than-expected third-quarter outlook was due mainly to delays in tactical radio procurements, reflecting government budget uncertainty and the increased likelihood that key international tactical radio orders will be awarded later in the year or next year.
Weak performance at integrated network solutions segment due to delayed software release in Healthcare Solutions and slower revenue growth at CapRock Communications also affected quarterly results.
For the full year 2013, Harris now expects income from continuing operations of $3.95 to $4.33 per share, and on an adjusted basis -- $4.60 to $4.70 per share. Revenue is now expected to decline 6 to 7 percent from last year.
Analysts currently estimate earnings of $5.03 per share on revenues of $5.26 billion for the year.
Previously, the company expected earnings of $5.00 to $5.20 per share on a 2 to 4 percent revenue decline.
Chief Executive William Brown said, 'Operating under a continuing resolution followed by sequestration and the related indecision surrounding how sequestration budget cuts will be implemented has delayed U.S. Government procurement decisions and reduced spending.'
Meanwhile, Harris said it plans to implement restructuring actions in the fourth quarter, including job cuts, facility consolidation, and prepayment of debt. The company expects the restructuring activities to generate annualized cost savings of about $40 million to $50 million, with charges of $65 million to $115 million.
'These cost actions, in addition to our ongoing focus on operational excellence and reducing discretionary spending, show our determination to adapt to the challenging fiscal environment while continuing to invest in R&D and strategic growth initiatives,' said Brown.
HRS closed Thursday's trading at $46.56, up $0.75 or 1.64%, on a volume of 1 million shares on the NYSE. The stock, however, fell $3.44 or 7.39% in after-hours trade.
Copyright(c) 2013 RTTNews.com. All Rights Reserved
Copyright RTT News/dpa-AFX