CPI Aerostructures, Inc. ("CPI Aero®") (NYSE MKT: CVU) has received a multi-year contract worth approximately $86.1 million from Northrop Grumman Corporation (NYSE: NOC) for Outer Wing Panel (OWP) kits. The kits are for use in the manufacture of complete wings for the E-2D Advanced Hawkeye and the C-2A Greyhound aircraft. This contract includes approximately $63.6 million in new funded backlog and approximately $22.5 million in requirements that were released to CPI Aero in 2013.
The E-2D Advanced Hawkeye is the U.S. Navy's primary airborne early warning and battle management command and control platform. The C-2 Greyhound's primary mission is to transport high-priority cargo, critical aircraft parts, mail and passengers to deployed Carrier Strike Groups.
CPI Aero has produced OWP kits for the E-2D Advanced Hawkeye and the C-2A Greyhound aircraft, which share a common wing design, since June 2008.
E-2D Advanced Hawkeye Requirements
On June 30, 2014, the Navy awarded Northrop Grumman a $3.6 billion multi-year contract to build 25 full rate production E-2D Advanced Hawkeyes. Aircraft deliveries under this new multi-year contract extend into 2021. The Navy's program of record calls for 75 E-2D Advanced Hawkeye aircraft of which Northrop Grumman has delivered 15.
C-2A Greyhound Requirements
Northrop Grumman is manufacturing new wings for the C-2A Greyhound aircraft to replace this service life limited component. This multi-year contract represents an additional $34.3 million in new requirements. The period of performance for the C-2A Greyhound portion of the contract concludes in late 2020.
Bart LaGrone, vice president, E-2/C-2 Programs, Northrop Grumman Aerospace Systems, commented, "The Northrop Grumman-led supplier team -- Team Hawkeye -- brings together the best in the industry, ensuring the continued success of the E-2D Advanced Hawkeye program. We've enjoyed an exceptional relationship with CPI Aero over the past six years. We congratulate them in earning a place on Team Hawkeye alongside Lockheed Martin, Rolls-Royce, BAE Systems and L-3 Communications."
Douglas McCrosson, President and CEO of CPI Aero, stated, "Securing a multi-year contract in the current fiscal environment requires exceptional program execution, superior product quality and the ability to provide the best value to our customer. We are excited to be able to continue as a key member of Northrop Grumman's Team Hawkeye."
Source: CPI Aerostructures, Inc.
Date: Nov 3, 2014