Trudeau defends Canadian military spending ahead of NATO summit as new report projects decline

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  7 mai 2020 | Local, Terrestre

  General Dynamics saw $1 billion bump after Canada-Saudi accord

  By: Joe Gould   1 day ago WASHINGTON ― General Dynamics has received $1 billion since the renegotiation of a $10 billion contract for Canada to sell light armored vehicles to Saudi Arabia, company officials said on its first quarter earnings call. In a deal last month, Canada lifted its ban on arms sales to Saudi Arabia, which in turn agreed to a speedier payment schedule for the LAVs. Canada had the vehicles on hold since 2018, following the death of Saudi journalist Jamal Khashoggi; and by October, Saudi Arabia had racked up $1.5 billion in back payments to General Dynamics. Amid news on the April 29 call that the company's revenue fell $512 million in connection with the coronavirus pandemic, General Dynamics Chief Financial Officer Jason Aiken highlighted “the formal signing of the restructured contract on the Canadian international program, which settled all issues to the satisfaction of the parties.” “With respect to our standing receivable you may recall that we received $500 million early in the first quarter and we received another $500 million this month. This will be very helpful to free cash flow in the second quarter,” Aiken said. “We will begin a regular cadence of scheduled payments in 2021 consistent with deliveries and making further progress in the scheduled amortization of the arrearage.” The company's Combat Systems division had revenue of $1.7 billion, up 4.4 percent over the same quarter last year, and sales to the U.S. government were up 12 percent. The firm's aerospace business segment also had revenue of $1.7 billion, but that represented a 23 percent fall from the same quarter last year. On April 9, Canada's foreign affairs minister, François-Philippe Champagne, announced Ottawa was “able to secure significant improvements” to the LAV contract, including more latitude for the Canadian government to speak about it. Under the new terms, Canada could also delay or deny export permits without penalty if it learned Saudi Arabia was not using the vehicles for their stated purpose. Ottawa would also be reviewing permit applications on a case-by-case basis to ensure they meet Canadian law and the U.N. Arms Trade Treaty. Though the Trudeau government has been under political pressure to scrap the LAV deal over human rights concerns, Champagne said its cancellation would have “resulted in billions of dollars in damages” and risked thousands of Canadian jobs across the defense supply chain. The vehicles are made by the General Dynamics Land Systems subsidiary in London, Ontario. https://www.defensenews.com/congress/2020/05/07/general-dynamics-saw-1-billion-bump-after-canada-saudi-accord

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  29 septembre 2020 | Local, Aérospatial, Naval, Terrestre, C4ISR, Sécurité, Autre défense

  COVID-19 further delaying some overdue military procurements

  Lee Berthiaume OTTAWA — While the federal government is pressing ahead with plans to buy billions of dollars worth of much-needed equipment for the Canadian Armed Forces, the Department of National Defence's top procurement official says COVID-19 is further slowing down some already delayed purchases. The past six months have seen a number of major milestones for Canada's beleaguered military procurement system, including last week's unveiling of the first of 16 new military search-and-rescue planes after 16 years of delays and controversy. Procurement officials are also now reviewing three bids that were received from fighter-jet makers at the end of July as Canada inches closer to selecting a replacement for the aging CF-18s following more than a decade of political mismanagement. The list of recent successes also includes Halifax-based Irving Shipbuilding having delivered the first of six new Arctic offshore patrol vessels in late July, while progress has been made on a number of other files, such as the long-overdue purchase of new engineering vehicles for the Army. Yet some of those milestones would have been achieved earlier had it not been for COVID-19. And Troy Crosby, the Defence Department's assistant deputy minister of materiel, acknowledges many other projects are being affected as well. That includes the more than 100 military procurements — roughly half of them dealing with new equipment and the rest focused on building new infrastructure on Canadian Forces bases across the country — that were listed as already delayed before the pandemic hit. "COVID didn't speed anything up," Crosby said in an interview with The Canadian Press. "I think everybody would understand that that's going to have some impact. And exactly what that impact is difficult to tell right now." Delays in military procurements can have several impacts. In some cases such the CF-18s, the Canadian Armed Forces is being forced to keep using equipment that was supposed to have been retired years ago. In others, delays drive up the cost of the new purchases due to inflation. The projects most likely to be delayed due to COVID-19 are those in production, Crosby said. Examples include the construction of new naval ships by Irving and Seaspan ULC in Vancouver, which have had to adopt physical distancing and other COVID-19 measures at their shipyards. "For the projects that are at a stage where the work is office-based ... once we got over that initial hump as everybody had to as we moved toward a remote-work posture, the work continued," said Crosby. "If you're in a shipyard and you're trying to advance the production of a ship given all of the physical distancing requirements and the health and safety considerations, that's challenging." Crosby has previously argued much of the frustration around military procurement is the result of unrealistic expectations born of a lack of understanding and appreciation for how the system — which is dealing with more projects than at any time in recent history — actually works. COVID-19 has also prompted speculation the Liberal government could start cutting back on its promise, unveiled in 2017, to spend $553 billion on the military over the next 20 years. Defence Minister Harjit Sajjan told The Canadian Press earlier this month that the funding is "secure." Asked about the spending plan — which is contained in the Liberals' defence policy and known as Strong, Secure, Engaged — Crosby said: "Strong Secure Engaged continues to be our focus and it laid out a program of work and we're trying to get that program of work delivered. "It's been that way right through this whole COVID situation. That hasn't changed anything. ... The people in the materiel group, the people we're working with across government, we're all seized with the program forward." This report by The Canadian Press was first published Sept. 28, 2020. https://www.kamloopsthisweek.com/news/covid-19-further-delaying-some-overdue-military-procurements-1.24211049

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  2 octobre 2018 | Local, Aérospatial

  HÉROUX-DEVTEK FINALISE L’ACQUISITION DE CESA ET MET À JOUR SES PRÉVISIONS

  Longueuil (Québec), le 1er octobre 2018 — Héroux-Devtek Inc. (TSX : HRX) (« HérouxDevtek » ou la « Société »), un important fabricant international de produits aérospatiaux, a le plaisir d'annoncer la finalisation de l'acquisition de l'entreprise Compañia Española de Sistemas Aeronáuticos, S.A. (« CESA »), une filiale d'Airbus SE (PA : AIR). Le prix d'achat s'élève à 137 millions d'euros (soit environ 206 millions de dollars) pour la valeur globale de l'entreprise, y compris l'encours de la dette nette de CESA de 23 millions d'euros (environ 35 millions de dollars), sous réserve des ajustements de clôture habituels. « Nous sommes ravis d'avoir finalisé la plus grande acquisition de notre histoire qui représente une étape charnière de notre expansion à l'échelle internationale, » a déclaré le président et chef de la direction de Héroux-Devtek, Gilles Labbé. « L'acquisition de CESA nous permettra de renforcer notre présence sur le marché européen, nous donnera accès à un important contenu dans le cadre de plusieurs programmes d'aéronefs d'envergure et nous aidera à développer encore davantage nos relations d'affaires avec Airbus et d'autres clients importants. Nous sommes honorés d'accueillir l'équipe de CESA au sein de la famille Héroux-Devtek. » « L'acquisition élargit également l'offre de produits et services de Héroux-Devtek dans les domaines des systèmes d'actionnement et hydrauliques, en plus d'ajouter de nouvelles technologies, comme l'actionnement électromécanique, à notre portefeuille. Notre offre évoluera aussi, et 42 % de nos revenus seront désormais générés par des produits propriétaires, » a poursuivi M. Labbé. « De concert avec l'ajout de l'expertise complémentaire de Beaver dans le domaine des vis à billes, nous voyons d'excellentes occasions de développer nos activités sur le marché des systèmes d'actionnement, dont la taille est considérablement supérieure au marché des trains d'atterrissage, » a conclu M. Labbé. « Nous comptons maintenir notre relation d'affaires étroite avec CESA, qui demeure un fournisseur de grande importance pour Airbus, » a déclaré Fernando Alonso, chef de la division Avions militaires d'Airbus Defence and Space. « CESA et ses employés tireront profit du plan industriel solide du nouveau propriétaire stratégique au cours des années à venir. » La transaction a été financée au moyen d'un emprunt à terme subordonné non garanti de 50 millions de dollars d'une durée de sept ans consenti par le Fonds de solidarité FTQ, de la facilité de crédit renouvelable de la Société, ainsi que de l'encaisse disponible. Dans le cadre de cette acquisition, la facilité de crédit de la Société a été modifiée: le plafond d'emprunt a été augmenté, passant ainsi de 200 millions de dollars à 250 millions de dollars. CESA, dont le siège social est situé à Madrid, en Espagne, est l'un des plus grands fournisseurs européens de systèmes hydrauliques et électromécaniques destinés à l'industrie aérospatiale. Ses principales gammes de produits comprennent des systèmes d'actionnement et hydrauliques ainsi que des trains d'atterrissage. CESA propose une offre de produits et de services intégrée à un large éventail de clients et de programmes d'aéronefs : ingénierie de conception et de développement, certification, fabrication, assemblage et soutien de la flotte. L'entreprise exploite un parc industriel de pointe d'une superficie de 366 000 pi2 à Madrid et une autre installation à Séville. CESA emploie une main-d'œuvre qualifiée constituée d'environ 300 employés. MISE À JOUR DES PRÉVISIONS La direction met à jour ses prévisions à l'égard des ventes pour l'exercice 2019 afin de tenir compte de l'acquisition de CESA. La direction s'attend maintenant à réaliser des ventes de l'ordre de 460 millions de dollars à 470 millions de dollars pour l'exercice 2019, ce qui représente une progression d'environ 20 % par rapport au précédent exercice. Les dépenses en immobilisations devraient s'élever à environ 20 millions de dollars. La direction publie également de nouvelles prévisions de croissance à long terme de ses ventes qui tiennent compte de l'acquisition de Beaver complétée en juillet dernier et de celle de CESA. La direction s'attend à ce que les ventes de la Société pour l'exercice 2022 se situent dans une fourchette de 620 millions de dollars à 650 millions de dollars. http://www.herouxdevtek.com/fr-CA/nouvelles-evenements/communiques-presse/2018