Exelis [XLS] on Friday reported strong earnings in the fourth quarter on a slight increase in sales as both of its remaining operating segments contributed to the strong results.

Net income from continuing operations increased 43 percent to $87 million, 45 cents earnings per share (EPS), from $61 million (31 cents EPS) a year ago. Sales edged up a percent to $933 million from $922 million.

Exelis says work on ship-based electronic warfare equipment helped boost sales last year. Photo: Exelis
Exelis says work on ship-based electronic warfare equipment helped boost sales last year. Photo: Exelis

Exelis, which is being acquired by Harris Corp. [HRS], did not host a conference call with investors to discuss its results. Harris is acquiring Exelis for $4.8 billion in cash and stock. The transaction is expected to close in June.

At the operating level, both the C4ISR Electronics and Systems, and the Information and Technical Services segments boosted the bottom line results with 19 percent increases to $107 million and $38 million, respectively.

Sales at C4ISR Electronic Systems increased 2 percent to $636 million while at Information and Technical Services sales dipped a percent to $297 million.

Orders in the quarter totaled $733 million with international customers accounting for 19 percent of the bookings. Total backlog at the end of 2014 stood at $6.3 billion, down $200 million from 2013, while funded backlog of $2.8 billion was unchanged from the prior year. Free cash flow was $119 million the quarter.

For the year, net income from continuing operations increased 29 percent to $230 million ($1.19 EPS) from $178 million (93 cents EPS). Sales were flat at $3.3 billion.

Orders for the year were $3.3 billion and free cash flow was $114 million.