Aerospace and defense operator L-3 Communications Holdings Inc. (LLL) announced that its unit, Link Simulation & Training (“L-3 Link”) received a contract to conduct the U.S. Air Force’s C-17 Training System (TS) program.
The contract is awarded for a year and includes four one-year options and an additional option for two more years of training support. This contract was originally awarded in November 2010, with a potential value of $976 million.
This new contract will establish L-3 Link as the prime operator of the Air Force C-17 TS program and will allow L-3’s unit to combine the former stand-alone C-17 Aircrew Training System (ATS) and Maintenance Training System (MTS) programs under a single contract.
L-3 Link and another unit of L-3 Communications, AAI Corporation, will provide a low-risk transition in support of both C-17 aircrew and maintenance training. L-3 Link will also try to reduce costs, identify areas of improvement, integrate all areas of C-17 training operations, develop the courseware and ensure proper management between the training system and the aircraft platform.
L-3 Communications receives regular contracts from the Defense departments. Recently, its unit STRATIS has been awarded a one-year $84.9 million contract under the U.S. Special Operations Forces Information Technology Enterprise Contract (SITEC) Distributed Computing Management Services (DCMS) program to sustain and maintain its distributed global enterprise information technology computing environment.
Given its overall strong performance during the first quarter in 2011, L-3 Communications raised its revenue guidance for 2011 to a band of $15.7 billion to $15.9 billion from the prior expectation of $15.5 billion to $15.6 billion. The earnings expectations for 2011 were also raised to $8.50–$8.60, from its previous guidance range of $8.40–$8.55. The Zacks Consensus Estimate for 2011 is presently $8.54 per share.
L-3 Communications currently retains a Zacks #3 Rank (short-term Hold rating). The company competes with Raytheon Co. (RTN) and Lockheed Martin Corporation (LMT).
Based in New York, L-3 Communication is a leading supplier of secure communications, simulation, training systems, avionics, ocean and telemetry products, space and wireless products, and microwave components, which are used in a number of aerospace and defense platforms.
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