August 17, 2020 | International, Aerospace
As public companies reported their latest quarterly results amid the recent financial carnage in the aerospace and defense sector, it was hard to find genuine optimism. With COVID-19 gutting the commercial aerospace manufacturing sector and maintenance, repair and overhaul segment, and expectations hardening around flat or worse defense spending, most corporate managers provided slimmed-down outlooks for the foreseeable future.
But one segment stood out for its near-universal positivity: space. It may have almost taken an implosion of the airliner business and historic federal deficit spending against a pandemic to get there, but suddenly outer space looks like the best place to be in business.
“Space continues to be an opportunity for companies to drive growth in a flat-to-down environment,” Jefferies analysts wrote in an Aug. 10 report.
As the recent earnings season showed, numerous companies are being lifted by space business. “The primes are having such strong growth there,” Credit Suisse analyst Rob Spingarn noted in a July 31 teleconference.
For instance, L3Harris Technologies sees space—both space-based and ground support—as its fastest-growing opportunity, with a combined $10 billion pipeline of long-term opportunities and several bid proposals awaiting responses that total around $1 billion in the near term. “We feel very encouraged by the space business as a whole,” said L3Harris Chairman and CEO Bill Brown.
Several others below the marquee prime government contractor level are also benefiting, according to Jefferies analysts Sheila Kahyaoglu and Greg Konrad. “Kratos Defense and Security is benefiting from the need for low-Earth-orbit (LEO) satellites in real-time data processing, and Mercury Systems is getting pulled in, given an increased need for data processing power at the edge.” What is more, both Booz Allen Hamilton and Parsons indicate that space is even a target area for mergers and acquisitions.
President Donald Trump's administration's spending and focus on space, from the new U.S. Space Force to a NASA mission to return Americans to the Moon in the coming years, certainly helps set the tone. Significantly, there is a commercial sector race to establish LEO-based communication and Earth observation services—albeit one driven by billionaires and their personal passions for a space legacy.
A more subtle shift, though no less significant, is occurring down the value chain, where there is an emerging middle market for space services. Companies such as Parsons, Virgin Galactic and KBR have reengineered their companies and are making money by providing support services for the space effort—in ways that are not as sexy as SpaceX's NASA crew transport mission but just as real when it comes to making a profit.
“We had nice year-on-year growth in the space business, just under double-digit growth there,” KBR CEO and President Stuart Bradie said Aug. 6. The former Halliburton business, once publicly associated with military logistics support during the George W. Bush administration, now is the world's only government-licensed provider training astronauts for commercial space missions.
“Investors often overlook that KBR has transformed its portfolio since 2015 and still perceive the firm as an engineering and construction play, given its heritage as a unit of Halliburton,” Cowen analyst Gautum Khanna noted in June. But acquisitions of Wyle Labs, Honeywell Technology Solutions and Stinger Ghaffarian Technologies in 2016-18 “put KBR on the map as a noteworthy government services competitor.” Government services, especially space, now are responsible for 70% of the company's annual revenue.
Interestingly, the space market is expanding so fast that KBR itself may have competition for astronaut training. In June, NASA signed a Space Act Agreement with Virgin Galactic to develop a private orbital astronaut readiness program for space tourists.
“As part of this, we will offer our existing space training infrastructure at Spaceport America and customized future Astronaut Readiness Program . . . allowing these private astronauts to become familiar with the environment in and en route to space such as G forces and zero G,” Virgin Chief Space Officer George Whitesides said Aug. 3. “This initiative has been largely driven by the considerable demand among our existing customer base to participate in orbital space flights.”
There have also been plenty of space company setbacks in recent months, with OneWeb's bankruptcy heading the list. But it should come as no surprise that business success in space is hard. Maybe what is surprising is that space is already proving lucrative for public investors, and the market looks set to grow.
https://aviationweek.com/defense-space/space/amid-financial-wreckage-ad-space-rises-above
August 18, 2023 | International, Land
Significant milestone has been achieved by the British Army's AS90 training system. This groundbreaking system has recently completed 100,000 simulated firings.
September 19, 2018 | International, Aerospace, Naval, Land, C4ISR, Security
By: Leo Shane III and Joe Gould WASHINGTON — With the fiscal year winding down, Senate lawmakers on Tuesday advanced a multi-agency appropriations deal that would prevent a government shutdown and give the Defense Department its full-year budget on schedule for the first time in a decade. The measure, which provides for more than $606 billion in base defense spending and nearly $68 billion more in overseas contingency funds, is in line with White House requests and spending targets outlined in the annual defense authorization bill approved earlier this summer. “After subjecting America's all-volunteer armed forces to years of belt tightening, this legislation will build on our recent progress in rebuilding the readiness of our military and investing more in the men and women who wear the uniform,” Senate Majority Leader Mitch McConnell, R-Ky., said before the Senate vote. The funding total — approved by a 93-7 vote — amounts to an increase of more than 3 percent for military spending in fiscal 2019, but as important as the boost is the timing of the measure. In recent years, Congress has struggled to pass any appropriations measures before the start of the new fiscal year, relying instead on a series of budget extensions to avoid partial government shutdowns. That has infuriated Pentagon leaders, who have said the fractured appropriations process prevents them from keeping equipment purchases and new program starts on time. If the House finalizes the appropriations measure next week and President Donald Trump signs it into law in the following week (all parties involved have already signaled they expect to do so ), it will mark the first time since 2008 that Congress and the White House have passed their spending plans on time. Senate Armed Services Committee Chairman Jim Inhofe, R-Okla., called that “a major victory” for Congress and the military. The measure funds a 2.6 percent pay raise for troops starting next January and a boost in military end strength of 16,400 spread across the active-duty and reserve forces. Operation and maintenance spending totals $243.2 billion of the defense total, and research and development efforts another $96.1 billion. Defense health and military family programs would receive $34.4 billion. The appropriations fund 13 new Navy ships ― including three DDG-51 guided missile destroyers and two Virginia-class submarines ― 93 F-35 aircraft, 58 UH-60 Black Hawk helicopters, 66 AH-64 Apache helicopters, 13 V-22 aircraft, and $1.5 billion for the upgrade of 135 Abrams tanks. The National Guard and Reserve Equipment Account would also see a $1.3 billion boost from the appropriations plan. In order to avoid political fights over non-defense spending levels, lawmakers agreed to package the military budget bill with the full-year funding for the Departments of Health and Human Services, Labor, and Education. In addition, the legislation contains a budget extension for a handful of agency budgets lawmakers have not yet finished negotiating. The move will prevent a government shutdown at the end of the month, when the fiscal year ends. Several senators lamented before the vote that all of the appropriations bills have not yet been finalized, but for the first time in years, defense advocates aren't among those complaining. In addition to the full Defense Department appropriations plan, lawmakers last week finalized a spending plan for military construction projects and the Department of Veterans Affairs, covering nearly all aspects of national defense and military personnel spending. https://www.militarytimes.com/news/2018/09/18/as-deadline-approaches-senate-advances-674-billion-defense-budget-bill
November 1, 2023 | International, Land
Switzerland becomes the 15th country to buy Patriot Advanced Capability-3 Missile Segment Enhancement weapon.