Northrop Cites Tigershark Costs for Decline in Profit

Northrop Corp., the aerospace giant, said Tuesday that its first-quarter earnings fell 13.6% despite an 18.2% increase in revenue.

Northrop blamed the decreased earnings on higher spending for its F-20 Tigershark jet fighter and the winding down of production of its profitable F-5 fighter, which is to be dropped next year.

For the three months ended March 31, Northrop earned $39.3 million, compared to a profit of $45.5 million a year earlier. Revenue rose to $1.3 billion from $1.1 billion.

The company said increased revenue resulted from brisker business in its aerospace and electronics segments, including more funds for secret government research and development. Northrop is building the Stealth bomber.

The company said its expenses for developing, testing, demonstrating and manufacturing the Tigershark during the three months were $46 million, compared to $33.8 million in the year-earlier period. That pushed Northrop’s cost on the Tigershark, the nation’s most expensive privately developed jet fighter, to slightly more than $1 billion. The company last year got back $46.5 million in insurance proceeds after the fatal crashes of two of its three F-20s.

The company said it expects another $154 million in Tigershark expenses this year as it gears up to put the plane in production. Work on the Tigershark began in 1982.

Northrop has been unsuccessful in finding any buyers for the F-20. But it is a contender in the Air Force’s multibillion-dollar competition for a new defense fighter.