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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported) - October 24, 2000
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LOCKHEED MARTIN CORPORATION
(Exact name of registrant as specified in its charter)
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<CAPTION>
<S> <C> <C>
Maryland 1-11437 52-1893632
(State or other jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification No.)
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6801 Rockledge Drive, Bethesda, Maryland 20817
(Address of principal executive offices) (Zip Code)
(301) 897-6000
(Registrant's telephone number, including area code)
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Not Applicable
(Former name or address, if changed since last report)
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Item 5. Other Events
Lockheed Martin Corporation (Lockheed Martin or the Corporation) is filing
this Current Report on Form 8-K to reflect its Global Telecommunications
business as a separate operating segment as discussed in more detail below.
In August 2000, Lockheed Martin consummated its merger with COMSAT Corporation
(COMSAT). The operations of COMSAT have been included in the results of
operations of Lockheed Martin Global Telecommunications (LMGT), a wholly-owned
subsidiary of the Corporation, from August 1, 2000. Prior to the merger, the
results of operations of LMGT included the Corporation's 49% investment in
COMSAT which was acquired on September 18, 1999 and accounted for under the
equity method of accounting. The total purchase price for COMSAT, including
transaction costs and amounts related to Lockheed Martin's assumption of COMSAT
stock options, was approximately $2.6 billion, net of cash balances acquired. In
addition to the merger with COMSAT, in October 2000, the Corporation combined
the operations of a business unit serving commercial information technology
markets with LMGT. LMGT was formed effective January 1, 1999 from the
combination of investments in several existing joint ventures and certain other
elements of the Corporation previously included in the Systems Integration and
Space Systems segments. Amounts related to such investments and elements
transferred were not material to the respective segments and, therefore, segment
information for periods prior to January 1, 1999 were not restated relative to
the formation of LMGT.
In accordance with Statement of Financial Accounting Standards No. 131,
"Disclosures about Segments of an Enterprise and Related Information," LMGT
will be reported as a separate operating segment called Global
Telecommunications beginning in the third quarter of 2000. The operations of
LMGT and the commercial information technology business unit were previously
included in the Corporate and Other segment. The following segment descriptions
and financial data have been adjusted to reflect the Corporation's Global
Telecommunications business as a separate segment for the periods indicated
based on the above information.
The Corporation operates in five principal business segments. All other
activities of the Corporation fall within the Corporate and Other segment.
Following is a brief description of the activities of each business segment:
Systems Integration - Engaged in the design, development, integration and
production of high performance electronic systems for undersea, shipboard, land,
and airborne applications. Major product lines include missiles and fire
control systems; air and theater missile defense systems; surface ship and
submarine combat systems; anti-submarine and undersea warfare systems; avionics
and ground combat vehicle integration; platform integration systems; command,
control, communications, computers and intelligence (C4I) systems for naval,
airborne and ground applications; surveillance and reconnaissance systems; air
traffic control systems; and postal automation systems.
Space Systems - Engaged in the design, development, engineering and production
of civil, commercial and military space systems. Major product lines include
spacecraft, space launch vehicles, manned space systems and their supporting
ground systems and services; strategic fleet
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ballistic missiles; and defensive missiles. In addition to its consolidated
business units, the segment has investments in joint ventures that are
principally engaged in businesses which complement and enhance other activities
of the segment.
Aeronautical Systems - Engaged in design, research and development, and
production of tactical aircraft, surveillance/command systems, reconnaissance
systems, platform systems integration and advanced development programs. Major
programs include the F-22 air-superiority fighter, the Joint Strike Fighter, the
F-16 multi-role fighter, the C-130J airlift aircraft, and Airborne Early Warning
& Control systems programs.
Technology Services - Provides a wide array of management, engineering,
scientific, logistic and information services to federal agencies and other
customers. Major product lines include engineering, science and information
services for NASA; aircraft maintenance and modification services; operation,
maintenance, training, and logistics support for military and civilian systems;
launch, mission, and analysis services for military, classified and commercial
satellites; research, development, engineering and science in support of nuclear
weapons stewardship and naval reactor programs.
Global Telecommunications - Provides communications services and advanced
technology solutions through three lines of business: enterprise solutions,
which provides telecommunications services, managed networks and information
technology solutions in the U.S. and international markets; satellite services,
which provides global fixed and mobile satellite services; and systems and
technology, which designs, builds and integrates satellite gateways and provides
systems integration services for telecommunications networks.
Corporate and Other - Includes the state and local government services line of
business. In addition, this segment includes the Corporation's investment in
certain other joint ventures and businesses.
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Selected Financial Data by Business Segment
Six Months Ended June 30, Year Ended December 31,
2000 1999 1999 1998
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(In millions)
Net sales
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Systems Integration $ 4,405 $ 4,599 $ 9,570 $ 9,334
Space Systems 3,452 3,618 7,209 8,600
Aeronautical Systems 2,289 2,766 5,499 5,459
Technology Services 1,063 985 2,261 1,935
Global Telecommunications 284 175 389 251
Corporate and Other 281 248 602 687
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$11,774 $12,391 $25,530 $26,266
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Operating profit (loss)
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Systems Integration $ 370 $ 373 $ 880 $ 858
Space Systems 213 210 561 1,045
Aeronautical Systems 168 46 247 649
Technology Services 62 68 137 135
Global Telecommunications (58) (54) (97) (4)
Corporate and Other (104) 107 281 (161)
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$ 651 $ 750 $ 2,009 $ 2,522
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Intersegment revenue (a)
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Systems Integration $ 223 $ 227 $ 470 $ 630
Space Systems 62 57 135 77
Aeronautical Systems 39 43 88 60
Technology Services 352 307 641 507
Global Telecommunications 7 9 17 6
Corporate and Other 23 21 47 40
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$ 706 $ 664 $ 1,398 $ 1,320
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Depreciation and amortization
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Systems Integration $ 104 $ 106 $ 223 $ 244
Space Systems 67 76 165 185
Aeronautical Systems 43 39 82 74
Technology Services 8 6 14 12
Global Telecommunications 11 1 5 2
Corporate and Other 18 20 40 52
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$ 251 $ 248 $ 529 $ 569
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(a) Intercompany transactions between segments are eliminated in consolidation,
and excluded from the net sales and operating profit (loss) amounts presented
above.
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Selected Financial Data by Business Segment (continued)
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Six Months Ended June 30, Year Ended December 31,
2000 1999 1999 1998
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(In millions)
Amortization of intangible assets
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Systems Integration $ 136 $ 137 $ 276 $ 273
Space Systems 28 28 57 60
Aeronautical Systems 40 40 80 80
Technology Services 9 9 18 18
Global Telecommunications 15 - 8 -
Corporate and Other 1 1 1 5
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$ 229 $ 215 $ 440 $ 436
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Nonrecurring and unusual
items included in operating
profit (loss)
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Systems Integration $ - $ - $ 13 $ 4
Space Systems 17 (20) 21 -
Aeronautical Systems - - - -
Technology Services (6) - - -
Global Telecommunications - - - -
Corporate and Other (109) 114 215 (166)
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$ (98) $ 94 $ 249 $ (162)
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Selected Financial Data by Business Segment (continued)
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June 30, December 31,
2000 1999 1998
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(In millions)
<S> <C> <C> <C>
Backlog
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Systems Integration $17,801 $13,971 $12,524
Space Systems 15,181 15,998 17,330
Aeronautical Systems 17,119 9,003 10,265
Technology Services 4,454 4,399 3,503
Global Telecommunications 1,549 1,533 763
Corporate and Other 968 1,009 960
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$57,072 $45,913 $45,345
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Assets
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Systems Integration $12,042 $12,209 $12,307
Space Systems 5,648 6,060 6,356
Aeronautical Systems 3,181 3,206 3,593
Technology Services 1,449 1,484 1,421
Global Telecommunications 2,214 2,145 71
Corporate and Other 5,358 4,908 4,996
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$29,892 $30,012 $28,744
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Customer advances and amounts
in excess of costs incurred
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Systems Integration $ 951 $ 1,039 $ 756
Space Systems 2,245 2,553 2,136
Aeronautical Systems 1,753 899 1,052
Technology Services 21 31 30
Global Telecommunications 174 132 2
Corporate and Other 1 1 36
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$ 5,145 $ 4,655 $ 4,012
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
LOCKHEED MARTIN CORPORATION
/s/ Marian S. Block
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Marian S. Block
Vice President, Associate General
Counsel and Assistant Secretary
October 24, 2000
