FALLS CHURCH, Va. – The war effort boosted the bottom line at defense contractor General Dynamics, which reported a 12 percent increase in fourth-quarter earnings Wednesday.

The parent company of Maine’s Bath Iron Works earned $246 million, or $1.21 a share, on sales of $3.5 billion in the final three months of 2001, compared with earnings of $219 million, or $1.09 a share, on sales of $2.7 billion in the year-ago quarter.

The earnings matched estimates of analysts surveyed by Thomson Financial/First Call.

The smallest of General Dynamics’ four divisions, its Combat Systems group, posted the biggest increase in sales and earnings. Operating earnings from Combat Systems increased 65 percent quarter to quarter, from $46 million to $76 million. Sales increased 93 percent, from $372 million to $717 million.

Company president and CEO Nicholas D. Chabraja credited the acquisition of Spain’s largest defense manufacturer, Santa Barbara Sistemas, and the acquisition of St. Petersburg, Fla.-based Primex Technologies, as well as sales of battle tanks to Egypt and growth of the Marine Corps’ Advanced Amphibious Assault Vehicle program, for the group’s performance.

“This was another year of strong, steady performance,” Chabraja said.

For the year, the company earned $943 million, or $4.65 per share, on sales of $12.2 billion. In 2000, the company earned $901 million, or $4.48 per share, on sales of $10.4 billion.

Falls Church-based General Dynamics employs about 52,000 people worldwide.

Shares of General Dynamics rose 51 cents to $79.15 by the close of trading on the New York Stock Exchange.