Martin Marietta Corp. will reorganize its computer contracting operations and eliminate about 400 jobs nationwide, a step the Bethesda-based company said will help it compete in a stagnating federal market.
The company said yesterday it will disband its Information Systems Group, which employs about 6,000 people, 1,500 of them locally. The group's operations will be folded into other wings of the company in the Washington area, Colorado and Florida.
"Companies occasionally are forced to restructure as a result of heavy debt or performance issues," Chairman Norman R. Augustine said through a spokesman.
"In this particular case, we're being preemptive and restructuring in anticipation of the difficult years that may lie ahead."
No decision has been made as to which jobs will be eliminated or where and how many will be cut through attrition as opposed to layoffs, a spokesman said.
In any case, the spokesman said, work will continue at the Chantilly facility where the group now has its headquarters.
"Over time, this could certainly help earnings, but it's hard to quantify," Peter Aseritis, aerospace analyst for First Boston Corp. in New York, said of the restructuring. But, he added, "it's not going to happen tomorrow."
Aseritis suggested that the change means the company will focus on increasing its profit on a comparatively stable volume of business, rather than increasing that volume.
By cutting costs and reducing duplication, Martin Marietta said, the move will hone its abilities in the federal information systems business. This is a complex and highly competitive field in which disparate brands and designs of computers and software are tied together into large, custom-designed networks to serve entire agencies.
In the 1980s, federal demand for this work mushroomed and many aerospace companies, including Boeing Co., Lockheed Corp. and Hughes Aircraft Co., entered the business. Their goal was to diversify away from defense and put their computer skills to new use.
Among the group, Martin Marietta has done particularly well. It has a $900 million contract for air traffic control systems from the Federal Aviation Administration and one worth $562 million to operate the Pentagon's Colorado Springs testing facility where much of the Strategic Defense Initiative research is performed.
Late last year, it also won a $526 million job from the Department of Housing and Urban Development.
"They are able to get in there and mix it up with the heavy hitters," said Bob Dornan, vice president of Federal Sources Inc., a Northern Virginia research firm that follows federal contracting.
One notable defeat, however, occurred in the contest for rights to build the federal government's huge FTS-2000 telecommunications network. Industry analysts have estimated that Martin Marietta spent about $40 million on its unsuccessful bid, Dornan said.
Federal demand for integration work remains strong -- Dornan's firm expects that between 30 and 40 contracts worth $20 million or more will be let in 1991, but the market has leveled off in many analysts' view.
Under the reorganization plan, four of the Information Systems Group's divisions will be joined with the company's Electronics and Missiles Group in Orlando, Fla. Three others will be tied to company wings in Denver and Washington.
Martin Marietta stock lost 50 cents yesterday in New York Stock Exchange trading, to close at $43.25 a share.