General Dynamics Corp. (NYSE:GD)

The financial data reveals an overall positive trend in both current assets and adjusted current assets over the five-year period ending in 2019.

Current assets

There is a steady increase from US$14,571 million in 2015 to US$19,780 million in 2019. This indicates a growth of approximately 36% over five years, suggesting improved liquidity and a stronger short-term financial position.

Adjusted current assets

The adjusted current assets closely mirror the trend in current assets, starting at US$14,568 million in 2015 and rising to US$19,780 million by 2019. The consistency between current and adjusted current assets implies minimal adjustments were necessary, pointing to stable accounting practices or negligible atypical items affecting current assets.

Overall, the upward trajectory in both figures demonstrates an enhancement in the company's capability to cover its short-term liabilities with current assets. The absence of fluctuations or declines throughout the period suggests a stable asset management approach contributing to improved financial health.

The analysis of the annual financial data reveals a consistent upward trend in both total assets and adjusted total assets over the five-year period ending December 31, 2019. Specifically, total assets increased from 31,997 million US dollars in 2015 to 48,841 million US dollars in 2019. This reflects a significant growth in the asset base of the entity.

Similarly, adjusted total assets show a parallel growth trajectory, rising from 31,668 million US dollars in 2015 to 48,808 million US dollars in 2019. The close alignment of total assets and adjusted total assets values indicates that the adjustments made to total assets did not substantially alter the magnitude or trend of the asset figures reported.

Total assets

Exhibited gradual increases year-over-year, with an especially notable jump between 2017 and 2018, moving from 35,046 million to 45,408 million US dollars. This suggests possible asset acquisitions or revaluations during that period.

Adjusted total assets

Followed a similar pattern to total assets, with consistent growth and a pronounced increase between 2017 and 2018, from 36,177 million to 46,835 million US dollars. The slight divergence between adjusted and unadjusted figures may reflect accounting adjustments that had minimal effect on overall asset valuation trends.

Overall, the data indicate a strengthening asset position over the period analyzed, with significant asset growth primarily occurring after 2017. This may be indicative of strategic investments, expansion activities, or changes in asset valuation policies contributing to the increased asset value.

The financial data reveals a consistent upward trend in both current liabilities and adjusted current liabilities over the five-year period ending December 31, 2019.

Current liabilities

The current liabilities increased steadily from US$12,445 million in 2015 to US$16,801 million in 2019. This represents an overall growth of approximately 35% over the period. The incremental rise was relatively gradual from 2015 to 2017, followed by more pronounced increases in 2018 and 2019.

Adjusted current liabilities

The adjusted current liabilities, which exclude certain components within the current liabilities, showed a similar increasing trend. Starting at US$11,616 million in 2015, they experienced a slight dip in 2016 to US$11,588 million but then rose consistently to reach US$16,801 million by 2019. Notably, by 2018 and 2019, the adjusted figures align exactly with the reported current liabilities, suggesting no adjustments were applied in those years.

Insights

The steady increase in current liabilities indicates that the company’s short-term obligations have expanded over the period, possibly reflecting growth or increased operational activity. The convergence of adjusted and reported current liabilities in the final two years may suggest changes in accounting treatments or financial structure. The dip in adjusted liabilities in 2016, followed by sustained growth, might warrant further review to understand specific adjustments made during that year.

Total Liabilities

The total liabilities exhibited a general upward trend over the five-year period. Starting at 21,259 million US dollars at the end of 2015, there was a modest increase to 21,896 million in 2016, followed by a continued rise to 23,611 million in 2017. A more pronounced growth occurred in 2018, with liabilities escalating sharply to 33,676 million, and this higher level was sustained, reaching 35,264 million in 2019. The substantial increase between 2017 and 2018 indicates a significant rise in the company's obligations during that time.

Adjusted Total Liabilities

Adjusted total liabilities followed a similar pattern to the total liabilities, starting at 20,836 million US dollars in 2015. Slight growth was observed in 2016, reaching 21,121 million, followed by an increase to 24,106 million in 2017. Consistent with total liabilities, adjusted liabilities experienced a marked surge in 2018, jumping to 34,084 million, but unlike total liabilities, a slight decline was noted in 2019 as the figure fell to 34,164 million. This adjustment suggests some variability in how liabilities were calculated or reported, but the overall trend remains aligned with total liabilities, indicating increased leverage or obligations during the period.

The financial data indicates a consistent upward trend in both shareholders’ equity and adjusted shareholders’ equity over the five-year period examined. Shareholders’ equity increased steadily each year, starting from US$10,738 million at the end of 2015 and rising to US$13,577 million by the end of 2019. This represents a cumulative increase of approximately 26.4% over the period.

Similarly, adjusted shareholders’ equity shows a continuous growth pattern, beginning at US$10,832 million in 2015 and reaching US$14,644 million in 2019. This corresponds to an approximate cumulative increase of 35.2%. The adjusted measure remains consistently higher than the reported shareholders’ equity for all years, suggesting that the adjustments made to the equity figures result in a more favorable presentation of the company’s net asset value.

The year-on-year changes reveal that both equity measures experienced their largest absolute increase between 2018 and 2019. This suggests an acceleration in value creation or retention during the most recent year observed. Overall, the data reflects positive equity growth trends, which might be indicative of retained earnings accumulation, revaluation surpluses, or other comprehensive income factors contributing to shareholders’ value enhancement.

The financial data reveals several notable trends in the company’s capital structure over the five-year period ending December 31, 2019.

Total Reported Debt

This metric increased moderately from 3,399 million USD in 2015 to 3,982 million USD in 2017, followed by a sharp rise to 12,417 million USD in 2018. In 2019, total reported debt slightly declined to 11,930 million USD. This indicates a significant increase in leverage commencing in 2018.

Shareholders’ Equity

Shareholders’ equity showed steady growth throughout the period, rising from 10,738 million USD in 2015 to 13,577 million USD in 2019. The increase was consistent and gradual, suggesting ongoing accumulation of retained earnings or capital injections.

Total Reported Capital

Total reported capital, as the sum of debt and equity, mirrored the trends in debt and equity. It gradually increased from 14,137 million USD in 2015 to 15,417 million USD in 2017, followed by a sharp increase to 24,149 million USD in 2018 and further to 25,507 million USD in 2019. The substantial jump corresponds with the increased debt level.

Adjusted Total Debt

Adjusted total debt data follows a pattern similar to the reported debt figures, increasing from 4,345 million USD in 2015 to 5,188 million USD in 2017, then surging to 13,882 million USD in 2018, and marginally reducing to 13,433 million USD in 2019. The elevated adjusted debt values indicate a rise in leverage risk when accounting for additional adjustments.

Adjusted Shareholders’ Equity

This category also showed consistent growth, increasing from 10,832 million USD in 2015 to 14,644 million USD in 2019, paralleling the trend in reported equity but at slightly higher levels.

Adjusted Total Capital

Adjusted total capital rose steadily from 15,177 million USD in 2015 to 17,259 million USD in 2017, followed by a marked increase to 26,633 million USD in 2018 and reaching 28,077 million USD in 2019. The trend reflects the sharp increase in adjusted debt aligned with equity growth over the last two years.

In summary, the company experienced relatively stable capital and equity growth from 2015 to 2017, with a pronounced shift in 2018 characterized by a significant increase in debt levels. Both reported and adjusted figures indicate elevated leverage from 2018 onwards, accompanied by steady shareholder equity growth. This suggests a strategic leverage increase while maintaining equity expansion, resulting in a larger overall capital base in the most recent years analyzed.

Net Earnings

Net earnings demonstrated relative stability from 2015 through 2017, fluctuating narrowly between approximately 2,900 million and 2,965 million US dollars. Beginning in 2018, net earnings reflected a noticeable increase, rising to 3,345 million and continuing upward to 3,484 million in 2019. This upward trend suggests an improvement in profitability during the latter part of the period, possibly due to effective cost management, revenue growth, or other operational efficiencies.

Adjusted Net Earnings

Adjusted net earnings exhibited a more pronounced upward trend during the five-year span. Starting at 2,815 million US dollars in 2015, adjusted earnings increased consistently to peak at 3,873 million in 2017. However, there was a decline in 2018, dropping to 3,048 million, before recovering in 2019 to 3,274 million. The initial strong growth followed by a dip and partial rebound may indicate the impact of non-recurring items or adjustments affecting the reported figures differently than the standard net earnings.

Comparative Insights

Throughout the timeframe, adjusted net earnings consistently remained below or above net earnings at different points, reflecting the influence of adjustments made to net income for a clearer view of operating performance. The divergence between the two metrics, especially noticeable in 2017 and 2018, suggests periods of significant adjustments affecting earnings. Overall, while net earnings indicate steady growth in the latter years, adjusted net earnings point to higher fluctuations, warranting further examination of underlying factors driving these adjustments.