Tactical Communications received several significant awards to support U.S. Army modernization, meet U.S. DoD readiness demand and combat evolving international threats:
- 1,540 radios, related equipment and services as an initial task order under the U.S. Army's $3.9 billion 2-Channel Leader Radio IDIQ — another key milestone in its multi-year modernization strategy
- $58 million for handheld, manpack and HF radios for the U.S. Air Force and the U.S. Army Security Assistance Brigades to support readiness demand
- $116 million from countries in Europe including $53 million from Ukraine supporting the Ukraine Security Assistance Initiative to modernize communications to meet emerging threats in the region
Public Safety received over $120 million in awards as it continued to strengthen its position in utilities and state, local and federal agencies. Awards included over $40 million from Nevada Energy and Washoe County, Nevada to design and build a statewide shared radio system, and $15 million from the U.S. Army under the previously announced $495 million IDIQ.
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Electronic Systems |
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| ($ millions) | First Quarter | ||||||||||
| FY 2019 | FY 2018 | Change | |||||||||
| Revenue | $ | 589 | $ | 541 | 9% | ||||||
| Operating income | $ | 115 | $ | 109 | 6% | ||||||
| Operating margin | 19.5 | % | 20.1 | % | (60)bps | ||||||
Revenue increased for the sixth consecutive quarter, up 9%, from growth in Avionics on increased F-35 production, in Electronic Warfare (EW) from F/A-18 and CV-22 platforms, and from the ramp of the U.K. robotics program and growth in missile defense programs in C4ISR. Operating income grew 6% to $115 million. Book-to-bill of 1.2 was driven by strength in EW and Avionics.
Harris continued to strengthen its position in electronic warfare and avionics on long-term platforms. The company was awarded a $255 million sole-source IDIQ to deliver upgraded countermeasure electronic warfare systems primarily for the B-52 platform, with an initial task order of $99 million. This award follows successful performance on a $260 million development program to meet the evolving electronic warfare needs of the B-52 platform. In addition, Harris was selected to provide the Open Systems Mission Processor as part of the third Technology Refresh program for the F-35, continuing to expand Harris’ content on this major platform.
Harris also leveraged its long partnership and excellent performance on the FAA Telecommunications Infrastructure program to capture a 5-year, $1.4 billion contract extension. Under this extension, Harris will continue to provide highly reliable and critical voice and data communications for National Airspace System operations at more than 4,400 FAA, U.S. DoD and National Weather Service facilities.
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Space and Intelligence Systems |
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| ($ millions) | First Quarter | ||||||||||
| FY 2019 | FY 2018 | Change | |||||||||
| Revenue | $ | 488 | $ | 466 | 5% | ||||||
| Operating income | $ | 86 | $ | 87 | (1)% | ||||||
| Operating margin | 17.6 | % | 18.7 | % | (110)bps | ||||||
Revenue increased 5%, as double-digit growth from classified programs, driven by small satellites and exquisite systems, was partially offset by expected lower revenue from environmental programs. Operating income decreased 1% to $86 million as higher volume was offset by increased investments in innovation. Book-to-bill was strong at 1.3.
In classified programs, Harris continues to gain momentum in ground processing capabilities and small satellite technology. The company received $79 million in follow-on funding for a ground-based adjacency contract initially awarded in fiscal 2017, increasing the total program value to $200 million; and received three additional small satellite awards supporting new customers, each with potential to grow to over $100 million. Harris also was awarded a $500 million IDIQ from the Defense Intelligence Agency for missions on the HELIOS program.
