25 septembre 2018 | International, Terrestre

SAIC boss tackles Engility acquisition, space market and revenue goals

WASHINGTON — News that SAIC would buy Engility was just the latest in a recent string of acquisitions among the professional services firms. But if you ask the CEO of SAIC, Tony Moraco, unlike some of the company's peers this was not transformational. This was instead a merging of two complementary businesses. In his words, “a momentum builder, as we are stronger together in the marketplace.”

It's also the next phase for a company that technically formed five years ago, with the split of the $11 billion legacy company with the same name.

Defense News sat down with Moraco to see how the acquisition fits into SAIC's future strategy, and how far the company has come since gaining independence.

About a year after SAIC split from Leidos, I asked you about your vision for the company. And you said to return to an $11 billion company. How does this acquisition fit into your vision for SAIC these days?

The Engility acquisition is very much consistent with our current strategy. It is not a deviation or a reset, as perhaps some of the other major transactions have been for some of our peers. But it really is about the theme of being stronger together, with [particular] compatibility of the intelligence community ... and also attributes in space market segments that we think we can both serve better. For us, this is opening market access to channels that we didn't have.

It's momentum building, a vision and a strategy that was five years in the making, and it's a continuation of that strategy going forward.

So have you been looking for an extended period of time? And why Engility specifically?

We consistently look at the market. We were not going to be a high-volume buyer, but more selective. The Scitor [acquisition] was more than three years ago. But we felt that we had a good position in the marketplace to grow organically. And we proved very strong performance over five years and since [that last acquisition of] Scitor. And then we've looked at many deals, large and small, to see what makes the most sense to us, staying true to our strategy.

The attraction with Engility was probably first sparked by the multi-intelligence agency portfolio that they have. Instead of buying a number of smaller concentrated firms, we could get a couple agencies in one larger deal. The company is large enough, they have a mature system. Again, in contrast to perhaps some of the small businesses, we think it has been through its own cultural shift to align very much to ours.

Also of interest is the space market. Today, with denied access and with the threats that we have, space is becoming a much more serious domain. The U.S. wants to invest more in it for a range of reasons. And when we think about space, it does cross, in fact, with the intelligence community, the defense sector with Air Force and the other services, and then also the civilian agencies with NASA, [and the National Oceanic and Atmospheric Administration].

As that market evolves, I think the U.S. government will be a principal customer. I believe that the commercial space entities will find a way where they'll also require key outsourced space services just as the government had.

So for a single transaction at scale where we could in fact use our equity, [and face] probably fewer buyers, filling three or four of our strategic initiatives in market access and in capabilities — we felt it was worth a serious look. But it's not just about space and intel. Defense will still be the largest part of our portfolio — 55 percent after we close [from 61 percent]. With the benefit of having the broader diversification in intel and federal civilian agencies, that serves all of our customers from a technology transfer perspective.

We've seen an interesting transition in the market, where the big primes are shedding portions of their services segments. Have we officially returned to the days when manufacturers focus on platforms only and leave the rest to the professional services companies?

I think we [for a period of time] faced a market that was uncertain. Our customers were reprioritizing their mission areas, and the industry was doing the same — looking at where they were going to focus their precious dollars, identify businesses they were going to protect, and areas that maybe weren't core. Then as the market started to improve and move away from cost reductions to protect margins to having some cash and some flexibility, you started seeing more portfolio shaping from the larger players.

It's not just about scale. There's [a focus on] the diversification because as you know, the whole business is based on past performance and on what qualifications you have in people and in contract vehicles; if you have a broader base concentrated in a few key areas, your ability to compete and win in those domains is improved.

There are a lot of technologies that are more heavily influencing the battlefield — whether ISR, electronic warfare, even still cyber, which is evolving. It seems those areas don't fit quite as neatly in one model or the other.

We've been around. It's not a body shop service that we run. It is services and solutions. But technology integration is a direct link to the customer's demand for modernization, the interest in innovative solutions from nontraditional players, the ability to field capabilities faster in a much shorter development cycle, and that leads you to a technology integration model that we have.

It allows us to take mission understanding and translate requirements into capability needs. So we can integrate, we can innovate with the technology and we can implement the solutions, which is fundamentally what the customer needs to migrate them from a current state to a future state.

But we're seeing more and more opportunities through the [Defense Innovation Unit], the [other transaction authorities], and other contract vehicles that provide a little more rapid prototyping flexibility.

SAIC bid for the Marine Corps Amphibious Combat Vehicle and is now working to compete for the Army's Mobile Protected Firepower program.How does that all fit into the broader strategy?

We do see it as a viable area, and I would characterize it as the next tier of complex technology integration, system integration. It's an extension of our command-and-control and ISR integration. I recall we pushed through 30,000 MRAP systematic build packages. That kind of integration of subsystems into a platform is what we felt was a baseline business that we could look to expand; and as the customer looked at, in this case, starting with Assault Amphibious Vehicle. Not a start-from-scratch build — the survivability upgrade really was around the armor, the underbelly and then your armaments protecting the vehicle. And then the related mobility requirements to change out transmissions and engines to support that extra weight. We felt that those subsystems and our mission knowledge afforded us the ability to extend to a little more of the physical platform itself.

We're doing work on the next-gen combat vehicle. And we're using a services model for MPF. Again, nondevelopmental, major integration of existing platforms for rapid field development. That fits well into our technology and integration model.

We see the ground vehicles and perhaps maritime [areas] as one that was probably more approachable versus, say, airframes. Modernization of aircraft has its own barriers of entry of getting flight readiness and the like.

We've extended our test-equipment knowledge to partnering with Lockheed on the propulsion system for torpedoes, for example. So we're just looking for selective areas to do more complex system integration under this broad technology integration umbrella. It just happens to be bigger subsystems. Complex system integration sets us apart from some of the current peers in the marketplace right now. But we're selective in what we go after.

How hard of a hit was the loss of the Marine Corps Amphibious Combat Vehicle in moving forward with that?

It's disappointing. We try to be practical and objective about our market position. It's an alternative model. It's still early in the life cycle. But I think that as we see different opportunities, we learn from it as the customers get more comfortable. So yes, disappointing on ACV, but at the same time we learned a lot from it and I think the customer ultimately got a very good result by having a competitive phase.

And we think that the Army [with MPF] will be as successful and come up with [the] best solution if they can maintain a competitiveness early in the process.

When the split first happened, you and Leidos were generally two different companies. With this acquisition, and with the Leidos acquisition from Lockheed, have you all started to mirror each other more?

I think we may be looking a little more alike. Five years ago I did not expect it. I think we had very clear strategies that [we] were intending to diverge, and therefore we did not have any formal noncompetes. We were looking at the services business model, and Leidos was looking to do more system development. I think their execution of that didn't play out as fast as they'd like. Roger [Krone, Leidos CEO], buying back in the services, more of the information system side, was a bit of a surprise. So if anything, they came back towards us versus us changing direction.

So I'd say they probably navigated slightly different than expected. But even today we're still two different companies. We're still very focused on letting our investors and customers know what we do, and Leidos still has a pretty diverse portfolio from health systems and some engineering services. We compete in similar subsegments but not in all. We're also organized very differently, we go to market differently.

When the deal closes, where does that put your total revenue at?

Right around $6.5 billion.

You told me you wanted to get back to $11 billion. Should we expect more?

No, not right away. That was very tongue in cheek at the time.

You knew I'd remember though.

Oh, I know. I remember it too, actually, because we laughed. There are lots of things we can do, but I felt very comfortable then and still do that we've got a great future and can grow the business organically as well as through acquisition. But it's not to chase the size. It really is about the market leadership. Running good margins and providing good mission capabilities for our employees. I think our market is still very motivated by mission. Our employees are very motivated to serve in different capacities whether it's in uniform or not.

https://www.defensenews.com/interviews/2018/09/24/saic-boss-tackles-engility-acquisition-space-market-and-revenue-goals

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29 janvier 2021 | International, Aérospatial

New Concerns Prompt U.S. Navy Review Of Key F/A-18E/F Upgrade
As Boeing seeks to market the F/A-18E/F Block III in several countries, U.S. Navy officials are reviewing and could delete conformal fuel tanks from a package of upgrades planned for the latest version of the multirole fighter. The Block III version of the F/A-18E/F adds several new features, but... https://aviationweek.com/defense-space/aircraft-propulsion/new-concerns-prompt-us-navy-review-key-fa-18ef-upgrade
9 avril 2018 | International, C4ISR

Here’s what the Army wants in future radios
By: Mark Pomerleau Advancements in electronics and tactics by high-end adversaries are forcing the Army to change the way it revamps and optimizes its communications network against current and future threats. The problem: adversaries have become more proficient and precise in the sensing and jamming of signals. “What we're looking for in terms of resilience in the future is not only making individual links more anti-jam and resilient, resistant to threats, but also having the ability to use multiple paths if one goes down,” Joe Welch, chief engineer at Program Executive Office Command, Control, Communications Tactical (C3T), told reporters during a network demo at Fort Myer in early March. “Your phones work this way between 4G and Wi-Fi and that's seamless to you. That's kind of the target of what we're intending to provide with next-generation transport for the Army's tactical network.” Members of industry are now looking to develop radios to these specifications outlined by the Army. “We have an extensive library of waveforms — 51, 52 waveforms that we can bring to bear — that we can say look we can use this waveform to give you more resilience with this capability,” Jeff Kroon, director of product management at Harris, told C4ISRNET during an interview at the AUSA Global Force Symposium in Huntsville, Alabama, in March. “Down the road, we need to talk about resilience and what's going on with the near-peer threats.” Next-generation systems, leaders believe, will be able to provide this necessary flexibility. “The radios that we're looking at buying now — the manpack and the two-channel leader radios — have shown themselves to be able to run a pretty wide range of waveforms and we think it postures us to run some changes to those waveforms in the future as we look at even more advanced waveforms,” Maj. Gen. David Bassett, program executive officer of C3T, told reporters at Fort Myer. While jammers have become more powerful and targeted in recent years, officials contend the entire spectrum can't be interrupted at once. The Army realizes links won't be jam-proof, Bassett told reporters at Fort Myer, so it is looking at how they can be either more jam-resistant or able to switch seamlessly across portions of the spectrum that are not being jammed. Kroon noted that one of the big developments within the radio community down the road will be radios that seamlessly switch frequencies or waveforms without direct user input. “I think, as we move forward, we'll start to have more cognitive capabilities that will allow [the radio] to adapt automatically, and keep the user focused on their own job and let the radio handle the rest,” he said. In addition to multiwaveform and a large range of spectrum coverage, Kroon said the Army is also really looking for multifunction capabilities within radios. Radios also have to have passive sensing capabilities to be able to understand the signals in the environment and provide some level of situational awareness of the spectrum environment. “They have to have visibility into what's going on around them ... not just for [electronic warfare] purposes but sometime just knowing what's going on in the spectrum around you as a planner is really important,” Kroon said. “What's actually going on out there, I don't know I was told this frequency was clear, how do I really know. Having a radio come back and say look what we hit ... it is actually very useful.” https://www.c4isrnet.com/show-reporter/global-force-symposium/2018/04/06/heres-what-the-army-wants-in-future-radios/
2 mai 2019 | International, Aérospatial, Naval, Terrestre, C4ISR, Sécurité, Autre défense

Contract Awards by US Department of Defense - May 1, 2019
ARMY Callan Marine Ltd., Galveston, Texas (W912EP-19-D-0023); Cashman Dredging and Marine Contracting Co. LLC, Quincy, Massachusetts (W912EP-19-D-0024); Cavache Inc.,* Pompano Beach, Florida (W912EP-19-D-0025 ); Continental Heavy Civil Corp., Miami, Florida (W912EP-19-D-0026 ); Cottrell Contracting Inc.,* Chesapeake, Virginia (W912EP-19-D-0027); Great Lakes Dredge and Dock, Oak Brook, Illinois (W912EP-19-D-0028); J.T. Cleary Inc., Spring Valley, New York (W912EP-19-D-0029); Manson Construction Co., Seattle, Washington (W912EP-19-D-0030); Marinex Construction Inc., Charleston, South Carolina (W912EP-19-D-0031); Norfolk Dredging Co., Chesapeake, Virginia (W912EP-19-D-0032); Orion Marine Construction Inc., Tampa, Florida (W912EP-19-D-0033); Southern Dredging Co. Inc.,* Charleston, South Carolina (W912EP-19-D-0034); The Dutra Group, San Rafael, California (W912EP-19-D-0035); Waterfront Property Service LLC, doing business as Gator Dredging,* Clearwater, Florida (W912EP-19-D-0036 ); Weeks Marine Inc., Covington, Louisiana (W912EP-19-D-0037); Cavache Inc.,* Pompano Beach, Florida (W912EP-19-D-0038); CJW Construction Inc.,* Santa Ana, California (W912EP-19-D-0039); Coastal Dredging Co. Inc.,* Hammond, Louisiana (W912EP-19-D-0040); Cottrell Contracting Inc.,* Chesapeake, Virginia (W912EP-19-D-0041); Florida Dredge and Dock LLC,* Tarpon Springs, Florida (W912EP-19-D-0042); Southern Dredging Co. Inc.,* Charleston, South Carolina (W912EP-19-D-0043); Southwind Construction Corp.,* Evansville, Indiana (W912EP-19-D-0044); and Waterfront Property Service LLC, doing business as Gator Dredging,* Clearwater, Florida (W912EP-19-D-0045), will compete for each order of the $495,000,000 firm-fixed-price contract for dredging and shore protection projects. Bids were solicited via the internet with 24 received. Work locations and funding will be determined with each order, with an estimated completion date of April 30, 2024. U.S. Army Corps of Engineers, Jacksonville, Florida, is the contracting activity. HB&A LLC,* Colorado Springs, Colorado (W9128F-19-D-0004); Kenneth Hahn Architects Inc.,* Omaha, Nebraska (W9128F-19-D-0005); and Yeager Architecture Inc.,* Overland Park, Kansas (W9128F-19-D-0006), will compete for each order of the $30,000,000 firm-fixed-price contract for preparation of studies, analysis and design services. Bids were solicited via the internet with 22 received. Work locations and funding will be determined with each order, with an estimated completion date of April 30, 2024. U.S. Army Corps of Engineers, Omaha, Nebraska, is the contracting activity. PRIDE Industries, Roseville, California, was awarded a $20,122,695 modification (P00008) to contract W91247-18-C-0011 for repair and maintenance support. Work will be performed in Fort Polk, Louisiana, with an estimated completion date of May 31, 2023. Fiscal 2019 operations and maintenance, Army funds in the amount of $5,772,517 were obligated at the time of the award. U.S. Army Mission Installation Contracting Command, Fort Polk, Louisiana, is the contracting activity. A. WBE-CCI JV One LLC,* Itasca, Illinois, was awarded a $7,828,000 firm-fixed-price contract for the construction of a new Air National Guard Fire Crash Rescue Station. Bids were solicited via the internet with five received. Work will be performed in Peoria, Illinois, with an estimated completion date of Oct. 30, 2020. Fiscal 2019 military construction funds in the amount of $7,828,000 were obligated at the time of the award. U.S. Property and Fiscal Office Illinois is the contracting activity (W91SMC-19-C-6001). S.D.S Lumber Co.,* Bingen, Washington, was awarded a $7,757,620 modification (P00007) to contract W912EF-18-C-0010 for towboat services. Work will be performed in Walla Walla, Washington, with an estimated completion date of April 30, 2021. Fiscal 2019 operations and maintenance, Army funds in the amount of $3,638,716 were obligated at the time of the award. U.S. Army Corps of Engineers, Walla Walla, Washington, is the contracting activity. STG Inc.,* Reston, Virginia, was awarded a $7,645,240 firm-fixed-price contract for operational and technical engineering. Bids were solicited via the internet with three received. Work will be performed in Fort Huachuca, Arizona, with an estimated completion date of April 30, 2020. Fiscal 2019 operations and maintenance, Army funds in the amount of $7,645,240 were obligated at the time of the award. U.S. Army Contracting Command, Aberdeen Proving Ground, Maryland, is the contracting activity (W91RUS-19-F-0142). DEFENSE LOGISTICS AGENCY Beacon Point Associates LLC, Cape Coral, Florida, has been awarded a maximum $49,000,000 fixed-price with economic-price-adjustment, indefinite-delivery/indefinite-quantity contract for medical/surgical supplies. This was a competitive acquisition with 16 responses received. This is a five-year contract with no options. Location of performance is Florida, with a May 14, 2024, performance completion date. Using customers are Army, Navy, Air Force, Marine Corps and federal civilian agencies. Type of appropriation is fiscal 2019 through 2024 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania (SPE2DE-19-D-0005). Allied Tube and Conduit Corp., Harvey, Illinois, has been awarded a maximum $46,000,000 firm-fixed-price with economic-price-adjustment contract for barbed tape concertina wire. This is a competitive acquisition with two responses received. This is a two-year base contract with three one-year option periods. Locations of performance are Illinois and Ohio, with an April 30, 2022, performance completion date. Using military services are Army, Navy, Air Force and Marine Corps. Type of appropriation is fiscal 2019 through 2022 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania (SPE8E6-19-D-0002). American Medical Depot (AMD), Miramar, Florida, has been awarded a maximum $45,000,000 fixed-price with economic-price-adjustment, indefinite-delivery/indefinite-quantity contract for medical/surgical supplies. This was a competitive acquisition with 11 responses received. This is a five-year contract with no option periods. Location of performance is Florida, with a June 11, 2024, performance completion date. Using customers are Army, Navy, Air Force, Marine Corps and federal civilian agencies. Type of appropriation is fiscal 2019 through 2024 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania (SPE2DE-19-D-0009). Kandor Manufacturing Inc., Kandor, Puerto Rico, has been awarded a maximum $13,896,462 firm-fixed-price, indefinite-delivery/indefinite-quantity contract for the Navy working uniform, Blouses/Trousers Type II and III, and maternity blouses. This was a competitive acquisition with five responses received. This is an 18-month base contract with three one-year option periods. Location of performance is Puerto Rico, with an Oct. 29, 2020, performance completion date. Using military service is Navy. Type of appropriation is fiscal 2019 through 2021 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania (SPE1C1-19-D-1163). (Awarded April 30, 2019) AIR FORCE Rockwell Collins Inc., Collins Aerospace – Mission Systems, Cedar Rapids, Iowa, has been awarded a $43,033,042 cost-plus-incentive-fee contract for Next Generation Application Specific Integrated Circuit Preliminary Design Review (PDR). This contract provides for the design, develop, and test of modernized Global Positioning System receivers that are intended for future military applications to the PDR level. Work will be performed in Cedar Rapids, Iowa, and is expected to be complete by April 2021. This award is the result of a sole-source acquisition. Fiscal 2019 research and development funds in the amount of $9,000,000 are being obligated at time of award. Space and Missile Systems Center, Los Angeles Air Force Base, California, is the contracting activity (FA8807-19-C-0003). International Business Machines Corp., Yorktown Heights, New York, has been awarded a $7,500,000 other transaction agreement for experimental purposes to provide an IBM Q access license. This agreement provides for remote access to the IBM Q System, a quantum computer with approximately 20 to 50 qubits. Work will be performed in Yorktown Heights, New York, and is expected to be complete by April 30, 2022. Fiscal 2019 research and development funds in the amount of $5,000,000 are being obligated at the time of award. Air Force Research Laboratory, Rome, New York, is the contracting activity (FA8750-19-9-0334). NAVY Systems Application and Technologies Inc., Largo, Maryland, is awarded a $14,583,586 cost-plus-fixed-fee contract to procure continued support services to the Air Vehicle Modification and Instrumentation (AVMI) Department and the Naval Air Systems Command (NAVAIR). Required services include support for the designing, developing, procuring, building, installing, testing and evaluating, calibrating, modifying, operating and maintaining instrumentation on aircraft and engines for the Navy and other government and commercial customers. Work will be performed at Patuxent River, Maryland (74 percent); China Lake, California (13.5 percent); and Point Mugu, California (12.5 percent), and is expected to be completed in November 2020. Working capital (Navy) funds in the amount of $8,000 will be obligated at time of award, none of which will expire at the end of the current fiscal year. This contract was competitively procured via the Federal Business Opportunities website, with four offers received. The Naval Air Warfare Center Aircraft Division, Patuxent River, Maryland, is the contracting activity (N00421-19-C-0023). *Small business https://dod.defense.gov/News/Contracts/Contract-View/Article/1831787/source/GovDelivery/

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