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Force Protection – 2007 Q2


As expected, Force Protection (NASDAQ: FRPT) reported yesterday (Aug. 9, 2007) a sharp increase in sales (140%) and net profit ($0.14 EPS) in its second quarter sales. The company's net sales reached US$134.7 million, compared to $56.1 million in Q2/06.

This surge reflects the growing demand for mine protected armored vehicles (MRAP) pioneered by Force Protection. In the first six months of 2007 the company sold about a quarter billion worth of armored vehicles ($234.9 million, 158% over the first half of 2006).

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It also spent about $8 million on the development of its future lightweight vehicle, expected to enter production next year. With production rate growing, it seems that the entire year will be extra strong for Force Protection, according to Gordon McGilton, Chief Executive Officer of Force Protection, during the quarter the company was awarded contracts totaling $711 million to produce 1,455 MRAP vehicles. Despite the growing competition from Navistar's International and BAE Systems' Armor Holdings, the demand for MRAP is so high that the military is buying everything the industry will be able to produce In 2008.

To meet this demand Force Protection is planning to expand its product line beyond the current Buffalo and Cougar, adding the lighter Cheetah vehicle. Force protection expects its new facility will have a production capacity supporting approximately 2,000 Cheetahs in 2008.

Anticipating the growing demand for its products, Force Protection is well positioned to benefit from the expansion of production facilities made in the past months. McGilton indicated that his company "produced 229 vehicles in the second quarter compared to 285 vehicles in all of 2006." These volumes also contributed to higher profits, reflected by quarterly operating profit of $13.9 million for the 2nd quarter, compared to $1.8 million for the Q2/2006. Shareholders should be equally satisfied as net income for the six month period reached $12.1 million, or $0.18 per diluted share, compared to net loss of $(989,267) or $(0.03) in the first half last year.

FY 2006: Force Protection Benefit from the Market Surge for Heavy Protected Armored vehicles

Benefiting from the rapid growth in the heavy armored vehicles market segment, Force Protection, Inc. (NASDAQ:FRPT) reported its first profitable year experiencing dramatic growth.

Force protection reported March 16, 2007 that its net sales for 2006 totaled US$196 million, the company's net income from these operations amounted to $18.2 million, or $0.39 per diluted share. The fourth quarter represented about a third of the annual sales, ($62.9 million) and contributed to 93% of the annual net income. According to Gordon McGilton, Chief Executive Officer of Force Protection, 2006 has been a milestone year for the company. Following the completion of a $152.75 million equity offering and forging partnerships with industry leaders such as General Dynamics and Armor Holdings, the company positioned itself on course to tap the potential of surging demand for heavy armored vehicles for the US forces, as reflected by the MRAP and JLTV programs.


 


 

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