Industry Week in Review – July 26, 2013
On Thursday, an official leaked that the Obama administration has opted not to deliver several F-16s to Egypt, preferring instead to have the fighters remain in Lockheed Martin’s plant. Political and diplomatic questions have arisen regarding the sale of the aircraft to a regime that overthrew democratically elected President Mohammad Morsi earlier this month. The decision to halt delivery is seen as largely symbolic, with just over a dozen of the twenty total aircraft already delivered to Egypt since the order was placed in 2010. The US delivers roughly $1.3 billion in military aid to Egypt and oftentimes uses such aid as diplomatic leverage to the politically embattled country. “This was a very specific decision made at this specific time about this specific case, so I would caution you to read further into it,” said State Department spokeswoman Jennifer Psaki. “Given the current situation in Egypt, we do not believe it is appropriate to move forward with the delivery of F-16s at this time.”
Repairs to the newest littoral combat ship (LCS) Freedom have been completed after the ship was temporarily disabled while in the South China Sea. According to the Navy, on July 20th, two of the ship’s diesel engines overheated prompting the shutdown and temporary disabling. After restarting the engines, the ship returned to port in Singapore to undergo repairs. The ship will return to participate in Cooperation Afloat Readiness and Training Singapore naval exercises, a joint training program between the US Navy and the Republic of Singapore Navy.
Spirit AeroSystems Holdings, Inc. (Up 8.6%) – Shares were up for the week after news of Spirit AeroSystems hiring a banker to find a buyer for its Tulsa, Oklahoma wing factory. GNK, a British aerospace and car parts maker is rumored to be interested.
FLIR Systems, Inc. (Up 12.0%) – Shares were up this week after FLIR Systems announced a 22.0% increase in its second-quarter net income despite missing Zacks Consensus Estimates by two cents.
SIFCO Industries, Inc. acquired MW General, an aerospace component supplier. The transaction increases the Company’s presence in the aluminum forging market and broadens its customer base. The terms of the deal were not disclosed.