Mon, May 13, 2013, 3:00 PM EDT - U.S. Markets close in 1 hr.
L-3 Communications’ (LLL) Oceania subsidiary clinched two contracts from the Australian Defense Force for the delivery of “of-the-shelf” satellite telecommunication terminals. The contract is valued at a total of $39.0 million.
The first contract totaling $32.0 million entails the supply of 51 portable satellite terminals, 30 deployment kits, spare parts and test equipment. This is expected to be shipped in 2014.
The second contract includes integrated logistics support, training, supply support services, maintenance services and engineering capabilities for terminal use. This contract is worth $7.0 million and will be carried out for a period of three years.
L-3 Communications’ diversified operations enable the company to efficiently maintain a stable earnings stream. In Feb 2013, the company received a U.S. Air Force Life Cycle Management Center contract for building two F-16 Block 52 Full Mission Trainers (FMTs) for the Iraqi Air Force.
With U.S. contract values gradually dwindling in the wake of defense budget uncertainties, strong orders from international customers have been a saving grace. L-3 Communications’ overseas business witnessed growth of 18% in the first quarter of 2013.
Going forward, L-3 Communications’ overall bookings at the end of 2012 stood at $10.9 billion. Furthermore, the company retained a solid backlog of orders worth $10.5 billion at the end of the first quarter. This will help maintain the growth momentum in the future.
L-3 Communications carries a Zacks Rank #3 (Hold). Other stocks in the defense domain currently performing well are Northrop Grumman Corporation (NOC), Erickson Air-Crane Incorporated (EAC) and Wesco Aircraft Holdings, Inc. (WAIR). All the above are well positioned to hold a Zacks Rank #2 (Buy).
Headquartered in New York, NY, L-3 Communications offers command, control, communications, intelligence, surveillance, and reconnaissance (C3ISR) systems; aircraft modernization and maintenance; and national security solutions in the United States and internationally.
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