Lockheed 2Q profit up 13 percent

Shares of Lockheed, the nation's largest defense contractor, rose $2.29, or 2.3 percent, to close at $103.88.

Lockheed said it earned $882 million, or $2.15 per share, in the second quarter, up from $778 million, or $1.82 per share in the same quarter last year.

The second quarter includes a 14 cent one-time gain from the settlement of a long running dispute with the federal government over land sales in California.

Stripping out one-time items, the company posted an adjusted profit of $2.01 per share.

Revenue grew 4 percent to $11 billion from $10.65 billion a year ago.

Analysts polled by Thomson Financial expected a more modest adjusted profit of $1.88 per share on $10.86 billion in revenue.

Lockheed now expects to earn between $7.45 per share and $7.60 per share and revenue of between $41.9 billion and $42.9 billion in 2008, citing the land settlement and higher projected profits across its businesses. In April, the company had forecast yearly results of between $7.15 per share and $7.35 per share on revenue of between $41.8 billion and $42.8 billion.

Analysts expect $7.47 per share on $42.8 billion in revenue for the year.

Bruce Tanner, the company's chief financial officer, said the company boosted its outlook based on expected strength in its areas such as missile defense work and new orders for the F-16 fighter jet from countries like Morocco that will extend the manufacturing line of the roughly 30-year-old jet program.