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Armor Holdings Inc.

April 19, 2007: Military armor and vehicle specialist Armor Holdings, Inc. (NYSE:AH) doubled its revenue in the first quarter (ended March 31, 2007) reporting totao revenues of $889 million, 100% over last year's Q1 ($445 million). The company recorded a $2.7 Billion Funded Backlog as of March 31, 2007. Net income before deduction of special bonuses was $50, compared to $41 in Q1/06. However, a generous bonus implemented as CEO Warren B. Kanders and President & Chief Operating Officer Robert R. Schiller met the goals of their compensation plan's goals reduced net income to $39 million. ($0.94 per diluted share).

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This payment did not hurt the bottom line though, as Earnings before interest, taxes, depreciation and amortization ("EBITDA") increased by 17% to $83 million versus $71 million in the Q1/06. The company expects revenues of $3.4 billion to $3.6 billion in FY 2007. Armor Holdings plans to invest up to $120 million in the expansion of medium vehicle production capacity and implementation of the U.S. Army Long Term Armor Strategy (LTAS) for the Family of Medium Tactical Vehicle (FMTV) trucks and M1151/52 (up Armored Humvee). Other expansion plans address ballistic materials manufacturing capability and soldier equipment products.

Robert R. Schiller, President & COO credited the ongoing demand for support for military vehicles as a major contributor for the company’s booming sales. "Better than anticipated sales and earnings were driven primarily by outperformance from our ground vehicle armoring operations, which benefited from the ongoing demand for armor components, supplemental equipment and spare parts for the military tactical truck fleet. Additionally, our OEM truck business continued to achieve targeted rates of production, and we received significant awards in each product category of our soldier equipment business." The company is also diversifying its activities in the armor field, and is now producing armor components for armored Humvees, as well as supplemental armor kits, including the motorized gunner protection kits and armored doors.

On May 7th, 2007 Armor Holdings Inc. (NYSE: AH) announced its agreement to be acquired by BAE Systems Inc. a subsidiary of UK based BAE Systems plc. BAE will take over the outstanding Armor Holdings shares in a one-step merger. BAE will allocate $4.1 billion to buy Armor's common share at $88 per share. The transaction is expected to close in the third quarter, subject to approval by Armor shareholders.

 


 

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