Newport News Overview

Transcription

1 Newport News Overview 2005 Institutional Investor Conference March 24, Mike Petters Newport News Sector President Northrop Grumman Corporation

2 Newport News.. Delivering Naval Superiority $2.7B sales 19,500 employees 3 operating locations RCOH/Maint / Repair Carriers Subs 2004 Sales Sole designer, builder and refueler of nuclear-powered aircraft carriers One of two companies capable of designing and building nuclearpowered submarines Substantial after-market business portfolio Quality earnings delivering stable cash flow $8B Total backlog across business base 2

3 Newport News Management Team Operations John Shephard Senior President Mike Petters Process Excellence Jennifer Boykin Strategic Planning and Integration Aircraft Carrier Program Business Management and Chief Financial Officer Dan Arczynski Bob Gunter Senior Barbara Niland Submarine Program CVN 77 Program Supply Chain Management Becky Stewart Scott Stabler Human Resources & Administration Veasey Wilson Bill Ermatinger Business Development John Mazach CVN 21 Program Matt Mulherin Technology Development and Fleet Support Irwin F. Edenzon Waterfront Nuclear Engineering and Test Rolf Bartschi & Chief Nuclear Engineer Communications Quality & Technical Services Sector Counsel Chief Information Officer Trades, Education and Training Contracts and Pricing Jerri Dickseski Director Dave Belanger Director Bill Mitchell Leni Kaufman Danny Hunley Tom Johnston 3

4 2004 Accomplishments Texas christening North Carolina and Hawaii keel-laying Commissioning of Virginia VCS Block II multi year award in May 73 DPIA and 70 RCOH planning contracts Supported Prometheus award Achieved USWA agreement Met all key financial objectives 4

5 Aircraft Carrier Construction George H. W. Bush (CVN 77) 5

6 Submarine Construction 6 Texas (SSN 775)

7 Fleet Maintenance USS Enterprise (CVN 65) USS Hyman G. Rickover (SSN 709) USS Dwight D. Eisenhower (CVN 69) 7 USS George Washington (CVN 73)

8 Carrier Refueling and Overhaul 8 USS Carl Vinson (CVN 70)

9 Carrier of the Future CVN 21 Construction slated to begin in 2007 Innovations will include: Enhanced flight deck with increased sortie rates Improved weapons movement Redesigned island New nuclear power plant Allowance for future technologies Reduced manning 9

10 The Revenue Pipeline: Long Term Visibility Carrier Construction REAGAN (CVN 76) BUSH (CVN 77) CVN 21 CVN 22 Submarine Construction VIRGINIA (SSN 774) TEXAS (SSN 775) HAWAII (SSN 776) NORTH CAROLINA(SSN 777) NEW HAMPSHIRE(SSN 778) NEW MEXICO(SSN 779) VCS 7 VCS 8 VCS 9 VCS 10 VCS 11 VCS 12 Carrier Refueling EISENHOWER (CVN 69) VINSON (CVN 70) ROOSEVELT (CVN 71) LINCOLN (CVN 72) Carrier Overhaul ENTERPRISE (CVN 65) Others REAGAN PSA BUSH PSA Current Advance Planning and Procurement Navy Plan to Newport News 10

11 Newport News Sales E 3 10% E sales drivers CVN 77 - Bush 8% CVN 21 Sales ($B) E 2006E 6% 4% 2% 0% Margin % of Sales VCS construction Fleet maintenance Margin expansion driven by sales mix and process improvements 11

12 Margin Expansion Strategy & Growth Focus on core business and after market opportunities Improve efficiencies through Process Excellence Balance cost structure as business fluctuates Leverage today s experience to develop tomorrow s workforce Meeting Customer Commitments 12

13 Process Excellence Improving Margins New organization in November 2004 to build on past success LEAN ARCHIPELAGO LEAN ENTERPRISE Lean Production & Mfg Engineering Process Qualification Mfg/Shops 13 Lean Process Qualification Lean infrastructure Six Sigma Supply Chain Mgmt Lean Implementation Coalition Engineering LIC established The Road to Lean Released PROCESS EXCELLENCE IPPD Lean Events Programs/ Ass y&test M O S Focus on Value Stream Enabling Processes 19 9 Focus: Improving processes, reducing waste, and enhancing cross-functional process efficiency Kaizens 6 Charter: Strengthen sector-wide performance by driving continuous improvements and standardizations S 20 0

14 Summary Building Shareholder Value Backlog remains strong enduring need for our products Renewed focus on process excellence to drive efficiencies for margin expansion Reshaping our relationship with our customer by making commitments and delivering on those commitments Delivering solid performance, consistent earnings and quality cash flow 14