Textron Inc. (TXT) announced that its unit, Textron Marine & Land Systems received an Undefinitized Contract Action (UCA) to Build Armored Vehicles for Afghanistan National Army (ANA). Per the contract Textron will produce up to 440 Medium Armored Security Vehicles (MASV).
MASVs include nine armored vehicle configurations designed specifically for ANA roles and missions, and are derived from the combat-proven M1117 Armored Security Vehicle (ASV) and ASV Armored Personnel Carrier (APC). In addition to ASV and APC configurations, other mission variants include: command and control, ambulance, engineering, maintenance, mortar, and reconnaissance vehicles. The vehicles will be contracted through the U.S. Army Foreign Military Sales (FMS) process. However, this effort is being funded by the Afghan Security Forces Funds (ASFF).
The one-year baseline contract, with a potential value of $257 million, authorizes initial funding of $125.9 million to begin work leading to the planned delivery of 240 MASVs and associated support equipment, spare parts, field service representatives, training and training aids. Vehicle production will be performed at Textron Marine & Land Systems’ facilities in the New Orleans area, with an estimated completion date in June 2012.
The contract includes options to produce up to an additional 200 vehicles, plus two option years for training and logistics support, with a potential value of $286 million. While these additional vehicles, if ordered, would be delivered by December 2012, training and logistics support would continue through the first quarter of 2014.
The first quarter 2011 earnings per share of the company were 10 cents, reversing the year-ago net loss of 1 cent per share, but 7 cents lower than the Zacks Consensus Estimate.
Textron presently expects 2011 earnings per share in the range of $1.00 to $1.15 taking into consideration top-line growth at its manufacturing segments. The Zacks Consensus Estimate for 2011 earnings per share is currently at $1.12.
Textron shares retain a Zacks #3 Rank (short-term Hold rating). We presently have a long-term Neutral rating on the stock. The company competes with General Electric Co. (GE) and United Technologies Corp. (UTX).
Based in Providence, Rhode Island, Textron Inc. is a global multi-industry company that manufactures aircraft, automotive engine components and industrial tools.
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