Budget cuts would affect programs, says Lockheed Martin

Budget cuts would affect programs, says Lockheed MartinDefence sector giant, Lockheed Martin has said that if the US Congress is not able to avoid across-the-board budget cuts, the company's programs would be scaled down, postponed or even cancelled.

The company said that the budget cut, which are likely to come into effect from Friday, will result in the company's sales and earnings falling to lower than expected levels. The company said that its sales for the year 2013 would fall more than expected if the budget cuts come into effect. On the assumption that the government will avoid the budget cut, the company is still expecting a decline in sales.

Lockheed Martin wrote in its annual report filed Thursday with the U. S. Securities and Exchange Commission that the company's cash flows would also be affected if the budget cuts come into effect from Friday. It pointed out that the company's results would be materially affected if the automatic implementation of the cuts is not averted.

Lockheed Martin is the largest supplier to the government and it earned about 82 per cent of its net revenues from the U. S. government customers in 2012, including 61 per cent from the U. S. Department of Defense.

The shares of the company fell 33 cents to $88.00 on the New York Stock Exchange on Thursday.