NEWPORT NEWS SHIPBUILDING REPORTS THIRD QUARTER RESULTS
EARNINGS PER SHARE UP 39 PERCENT; CASH FLOW STRONG

NEWPORT NEWS, Va., October 24, 2001 – Newport News Shipbuilding (NYSE: NNS) today reported net earnings of $27 million, or $0.85 per diluted share, for the third quarter of 2001.  Earnings before interest and taxes (EBIT) for the quarter were $57 million.  Included in the third quarter results were approximately $4 million, or $0.08 per share, in merger related charges.  Absent these non-operational expenses, the Company’s earnings per share (EPS) were $0.93, up 39 percent from $0.67 per diluted share reported in the same period one year ago.  Free cash flow for the quarter was $36 million bringing the year-to-date total to $153 million, or $4.87 per share.

Revenues in the third quarter increased 17 percent to $578 million from $493 million reported in the prior year’s quarter.  The company reported favorable revenue comparisons across all business segments in the quarter.  “I am particularly pleased with the strong performance delivered by the Construction segment,” noted Chairman and Chief Executive Officer William P. Fricks.  “Construction revenues advanced 35 percent over the third quarter of 2000 led by the continued production ramp-up on both the CVN 77 and Virginia-class programs.  Earnings were also strong as adjusted EBIT of $61 million advanced 22 percent over the third quarter of 2000.”

“This outstanding financial performance in the third quarter represents a continuation of the favorable results we’ve delivered throughout the year and positions us to meet or exceed our full year estimates,” added Fricks.

Newport News Shipbuilding also announced today that the Board of Directors declared a dividend of $0.04 per share on the issued and outstanding stock of the company.  The dividend will be payable on or about November 16, 2001 to shareholders of record as of November 5, 2001.  This is the twentieth consecutive regular dividend declared since Newport News became an independent company in December 1996.

Newport News Shipbuilding designs and constructs nuclear powered aircraft carriers and submarines for the U.S. Navy and provides lifecycle services for ships in the Navy fleet.  The Company employs about 17,800 people, and has revenues of approximately $2 billion.

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*       Nonrecurring items consists of approximately $4 million and $13 million of merger related charges recognized in the third quarter of 2001 and the year-to-date 2001 periods, respectively.

*  Nonrecurring items consists of approximately $4 million and $13 million of merger related charges recognized in the third quarter of 2001 and the year-to-date 2001 periods, respectively.

Notes: (1)   Funded backlog was $5.9 billion, $6.3 billion, $6.1 billion, and $2.2 billion at 9/16/2001", 6/17/2001, 3/18/2001, and 12/31/2000, respectively.

CAUTIONARY STATEMENT FOR PURPOSES OF "SAFE HARBOR" PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 This news release contains forward-looking statements concerning, among other things, the company’s prospects, expectations and business objectives and strategies.  Readers are cautioned that these statements are based on assumptions that are subject to risks and uncertainties.  No assurance can be given that the company’s actual results will not differ materially from the results discussed in these statements.  Factors that might cause such a difference include, but are not limited to, those discussed in the company’s 2000 Annual Report to Stockholders and in Item 1 of the company’s 2000 Annual Report on Form 10-K (under the caption "Government Contracting, Claims and Investigations") and in Note 13 (“Commitments and Contingencies - Government Contracting and – Significant Estimates") and Note 3 (“Commitments and Contingencies – Government Contracting”) to the Consolidated Financial Statements of the company contained in its 2000 Annual Report on Form 10-K.