Dear HII Teammates,

This morning we released third quarter results that reflect solid performance from the HII teams who work hard, every day, to support our national defense customers. We reported sales of $2.6 billion for the quarter, which is 12% higher than during the same period last year. For complete financial results, please read our news release.

These highlights from our business segments reflect our continued focus on operational execution:

Ingalls Shipbuilding was awarded a $2.4 billion detail design and construction contract for LHA 9 during the quarter, and continues to make significant progress in each of its programs. Ingalls completed acceptance trials on guided missile destroyer Lenah Sutcliffe Higbee (DDG 123) and authenticated the keel for Jeremiah Denton (DDG 129). Teams also began fabrication of San Antonio-class amphibious transport dock ship Pittsburgh (LPD 31). Ingalls has also commenced the work to complete the combat system installation and activation on the Zumwalt-class destroyer Lyndon B. Johnson (DDG 1002).

During the quarter, Mission Technologies won several significant awards in intelligence, surveillance and reconnaissance (ISR) as well as live, virtual constructive (LVC) training and electronic warfare. We also received major contract actions in our nuclear and environmental business that were driven by strong performance. Looking to the future, the Mission Technologies pipeline for new business remains strong, and we see growth potential in both domestic and international markets, where we are expanding our presence in regions consistent with the National Security Strategy.

Newport News Shipbuilding continues to make progress on the second in the Ford class of aircraft carriers, John F. Kennedy (CVN 79), and is testing the ship’s electromagnetic launch system. Shipbuilders have also laid the keel for Enterprise (CVN 80). The refueling and complex overhaul of USS George Washington (CVN 73) remains on track to re-deliver next year. NNS also continues to make progress on the Virginia-class submarine program. The division expects to deliver New Jersey (SSN 796), and float off Massachusetts (SSN 798) next year.

During the quarter, HII was awarded approximately $2.1 billion in new contracts. Backlog is now approximately $46.7 billion, of which $23.2 billion is funded. Looking forward, we expect customer needs will present significant new contract award opportunities, driving our backlog stability and growth.

Through the third quarter, we have hired over 3,600 craftsmen and women, making progress toward our goal of hiring 5,000 this calendar year. Still, the economic environment remains extremely challenging. To grow our talent pipeline we are broadening our recruiting efforts and expanding our successful apprenticeship programs.

We continue to take steps to execute on our strong backlog and position for long-term growth, which will generate value for our employees, customers and shareholders. HII remains an employer of choice, committed to supporting our customers in service of national security and the nation.

 

Respectfully,

Chris Kastner
President and CEO

 

This message is also available on Homeport at: https://www.hii-homeport.com/docs/2022/HII-Executive-Memo-Chris-Kastner-Q3-Earnings-November-3-2022-v2.pdf.