A $1 billion British order for Predator unmanned aircraft is winding its bureaucratic way toward General Atomics Aeronautical Systems Inc.
GA-ASI said it expects to start deliveries to the U.K. Royal Air Force in late 2018.
The Pentagon’s Defense Security Cooperation Agency said on Nov. 16 that it notified Congress of a possible sale, adding that the State Department gave its OK. The sale includes an aircraft model that GA-ASI calls the Certifiable Predator B, related equipment, training and support.
The following day, GA-ASI reported that the Certifiable Predator B made its inaugural flight at the company’s private airfield in the Mojave Desert near Palmdale.
(Certifiable, in this context, means that the aircraft meets NATO airworthiness requirements, and is equipped to fly in civil airspace.)
GA-ASI, based in the Poway Business Park, plans to build five of the new aircraft for itself, including two airframes for fatigue and static testing.
The Pentagon said the Royal Air Force plans to buy a minimum of 16 and a maximum of 26 aircraft; up to a dozen advanced ground control stations; dozens of targeting and intelligence sensors; and logistics support for at least two years.
Separately, GA-ASI said on Nov. 29 that it planned to interview potential suppliers from Spain in January. Those partners could provide components and services for a Predator B model that GA-ASI plans to sell to the Spanish Air Force.
GA-ASI is part of privately held General Atomics.
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Navy Taps Four for IT Work: The U.S. Navy has chosen companies that will tend its shore-based computer networks over the next three years — and possibly longer.
The deals are big, easily adding up to hundreds of millions of dollars, and much of the work will be in San Diego.
Four businesses will provide computer-network support for the Navy shore units and joint bases (that is, bases that are home to more than one U.S. military service). Some 40 percent of the work will be local.
Eight companies vied for the indefinite-quantity contracts. The four winners will now await task orders. They are:
• King Technologies Inc., a privately held business in Point Loma. Its three-year deal could be worth up to $52.5 million. If the Navy exercises its options to order two more years of work, it could grow as large as $88.6 million.
• Science Applications International Corp. (NYSE: SAIC) of Virginia, up to $49.8 million over three years or up to $83.9 million with all options exercised.
• Engility Corp. (NYSE: EGL) of Massachusetts, up to $48.7 million over three years or up to $82.4 million with all options exercised.
• Booz Allen Hamilton Inc. (NYSE: BAH) of Virginia, up to $46.3 million over three years or up to $78.5 million with all options exercised.
The contractors will provide in-service engineering support, design, accreditation, integration, production, sustainment, and life cycle support for “non-integrated” shore systems, network components and network service solutions.
The 60 percent of the work not performed in San Diego will be both inside and outside the continental United States, the Pentagon announcement said. Space and Naval Warfare Systems Center Pacific awarded the deals, which were announced on Nov. 28.
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AIA Advocacy: Cubic Corp. (NYSE: CUB) CEO Bradley Feldmann was named to the board of the Aerospace Industries Association for 2017. The AIA lobbies for defense and aerospace contractors. With the arrival of the Trump administration and the Republican-controlled Congress, AIA members say 2017 is going to be an important year for shaping public policy.
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Unmanned Milestone Met: Kratos Defense & Security Solutions Inc. (Nasdaq: KTOS) said on Nov. 29 that its BQM-177A subsonic aerial target drone, which it is building for the Navy, passed its final development program milestone. Low-rate initial production might begin under the 2017 defense budget, which Congress has yet to approve.
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Speaking of Cubic: Cubic Corp. reported its annual results Nov 21. Fiscal 2016 sales of $1.46 billion rose from $1.36 billion in fiscal 2015.
Net income continued its steep slide. It was $1.7 million, down from $22.9 million in 2015 and $69.5 million in 2014.
CEO Brad Feldmann said the company was disappointed that it did not hit its financial forecast. Part of the problem was funding delays from its federal customer. Complicating matters were growth initiatives: Cubic acquired GATR and TeraLogics, borrowed money to cover a portion of the purchases and had to pay interest charges, all while attempting to streamline business processes with a new computer system.
For the new fiscal year, the company said it expects sales to increase 3 percent to 7 percent (to the range of $1.51 billion to $1.56 billion).
Cubic’s one-of-a-kind business model combines defense contracting with mass-transit electronics. The latter makes up 40 percent of sales.
Send San Diego defense contracting news to bradg@sdbj.com.
