Orbital ATK Inc (NYSE:OA) reported its second-quarter results before the market opened on Tuesday. The aerospace leader's earnings soared thanks to new orders and solid operations. It expects that positive momentum will continue through the second half of the year, giving it the confidence to raise its guidance.

A look at the numbers
Orbital ATK's adjusted revenue, which provides a better apples-to-apples comparison as a result of the company's recent merger, was $1.13 billion, which is slightly higher than the year-ago quarter when adjusted revenue was $1.055 billion. Revenue was also higher than analysts' expectations as it beat the consensus estimate by $50 million. Driving this better-than-expected result were "outstanding new orders" according to comments made by CEO David Thompson in the press release.

Earnings were even better as the company reported operating income of $131.6 million, which is up 11% from the year-ago quarter. On a per share basis the company earned $1.28, which was well above the $1.10 per share it earned in the same period of 2014 and $0.26 per share higher than analysts were expecting.

Driving these better than expected results were the company's Flight Systems Group and Space Systems Group as operating income increased $13.6 million and $25.9 million, respectively. The increased profitability was due to improvements in the company's launch vehicles, civil and defense satellites, and commercial satellites divisions. This helped offset a slight $1.3 million decrease in the company's Defense Systems Group. 

One of the real highlights were the robust new order bookings that Orbital ATK received during the quarter as the company recorded $1.36 billion in new firm and option contracts while also receiving $810 million in option exercises under existing contracts. That brought its firm backlog up to $8.4 billion, with its total backlog now up to $12.2 billion assuming all options and other contracts are exercised.

A look at the outlook
Thanks to a combination of the strong second-quarter results and new order bookings Orbital ATK is boosting its full-year guidance. The company is increasing its revenue guidance from $4.35-$4.45 billion up to $4.425-$4.5 billion while also boosting per share earnings from $4.40-$4.60 to $4.60-$4.80. That being said, it is keeping its free cash flow guidance intact at $225-$275 million. However, the company did still increase its stock buyback authorization by $25 million to $100 million.

Investor takeaway
Orbital ATK's second quarter results show the benefits of the company's recent merger as the combined entity is driving stronger growth. Its strength the company expects will continue throughout 2015 as strong new order bookings are giving it the confidence to raise its full-year outlook. The combined company is also starting to generate solid free cash flow, which is leading to increased shareholder distributions via its newly initiated dividend and increased stock buyback authorization.