NEWPORT NEWS SHIPBUILDING ANNOUNCES CONTRACT AWARD TO CVN 77 WARFARE SYSTEMS INTEGRATOR

NEWPORT NEWS, Va., March 21, 2001 -- Newport News Shipbuilding (NYSE: NNS) announced today that it has awarded Lockheed Martin Integrated Systems, Inc., a wholly-owned subsidiary of Lockheed Martin Corporation, a subcontract to provide the warfare system for the U.S. Navy's next nuclear-powered aircraft carrier, CVN 77. This contract, valued at approximately $446 million, comes after a yearlong competition conducted by Newport News Shipbuilding that ended in January 2000. Since that time, NNS and Lockheed Martin Naval Electronics and Surveillance-Surface Systems, the lead operating company for this subcontract with Lockheed Martin, have been working together under an Advance Planning Contract to prepare for the full-scale detail design and construction of CVN 77. The warfare system will be delivered as part of Newport News Shipbuilding's $3.8 billion contract from the Navy for CVN 77 that was signed in January 2001. The award to Lockheed also includes an additional $40 million option for exterior communication equipment.

Warfare system integration includes improving the interoperability between the sensors, communications systems, aircraft control systems, armaments and other electronics systems on the ship. Enhanced integration of the warfare system is key to reducing man-power requirements on future carriers, which will make them more affordable to the Navy during their planned 50-year service life.

With the inclusion of the warfare system as part of the company's prime contract for the CVN 77, NNS is expanding its role as total ship integrator. "This is a first for Newport News Shipbuilding," said Irwin F. Edenzon, vice president, Technology Development and Carrier Fleet Support. "For previous carrier programs, the Navy has provided the warfare system as Government Furnished Equipment (GFE). We are looking forward to continuing our work with Lockheed Martin to provide the Navy the most capable and cost-effective ship."

CVN 77 is the first step in the Navy's three-ship evolutionary strategy for developing the next class of carriers. "The CVN 77 warfare system will be the first building block to the next class of carriers. We are working with Lockheed Martin to deliver an open architecture, COTS-(commercial-off-the-shelf) based system that will allow us to readily support and upgrade the system over its 50-year service life."

Newport News Shipbuilding designs and constructs nuclear-powered aircraft carriers and submarines for the U.S. Navy and provides life-cycle services for ships in the Navy fleet. The company employs nearly 17,000 people and has annual revenues of approximately $2 billion.