On Wednesday, the House of Representatives passed a $982 billion continuing resolution (“CR”) that would avoid a government shut down on March 27th, funding the government through the end of the fiscal year on September 30th. The CR includes a $518.1 billion defense appropriations bill, equal to 2012 defense appropriations, as well as $87.2 billion in OCO funding.
While these funding levels would be subject to sequestration, the bill does offer agencies increased flexibility in administering cuts, especially in Operations & Maintenance (“O&M”) accounts, by shifting funds around. The bill moves $10.4 billion into O&M accounts from R&D and procurement accounts, for example. The bill is likely to face steep opposition in the Senate, which is expected to vote on its version next week. Before its passage, the White House had indicated that it would not veto a CR that reflects previous fiscal legislation, suggesting that if this version is approved in the Senate, President Obama would sign the legislation.
Ducommun (up 11.0%) – shares were up for the week following the Company’s announcement of fourth quarter and full year 2012 financial results. Revenue for the quarter was $193.9 million, up from $188.2 million in 4Q11, while EPS was $0.32, up from a loss per share of ($4.60) in 4Q11. For the year, revenue grew to $747.0 million from $580.9 million in 2011, and EPS grew to $1.55 from a loss per share of ($4.52) in 2011.
AeroVironment (down 13.7%) – shares were down for the week after the Company announced fiscal third quarter financial results that, according to CEO Tim Conver, “fell well short of our plans due to delays in government procurements expected during the quarter.” Revenue for the quarter was $47.1 million, down from $72.0 million last year, while EPS for the quarter was $0.17, down from $0.26 a year earlier.
RBC Bearings acquired Western Precision Aero, a manufacturer of CNC machined components and assemblies for aerospace and military applications, for $2.6 million. The transaction, which represented a 2012 Revenue multiple of 0.52x, expands RBC’s product portfolio in the aerospace market.
MacAulay-Brown has acquired the Secure Computing & Communications division of Luna Innovations, for $6.7 million. The acquisition expands MacB’s capabilities and footprint in critical sectors of the Intelligence Community, Department of Defense, and Homeland Security.