Arotech's share soars on $63m US Army order

US subsidiary FAAC received a contract from the US Army for 28 Virtual Clearance Training Suites for mine detection and clearance simulators.

The share price of Arotech Corporation (Nasdaq: ARTX) jumped 54% since Monday's announcement that its US subsidiary FAAC Inc. received a $63.4 million contract from the US Army for 28 Virtual Clearance Training Suites (VCTS). The contract could increase to $93.9 million, if all priced options are included. The simulators will be delivered over three years.

The VCTS simulates the wide array of large and small technical devices, purpose-built mine-protected detection and clearing vehicles, and constantly evolving tactics and techniques used by the US Army to combat improvised explosive devices. The order, not including the priced items, increases Arotech's backlog to $105 million.

Arotech CEO Robert Ehrlich said, "This is a great win for FAAC and validates Arotech's commitment to the training and simulation market."

Arotech also issued a revenue warning, saying that due to shipment delays to the IDF by its Armor Division, first quarter revenue will be 37% less than for the corresponding quarter of 2010. The company added that because the orders are due to be shipped later this year, full-year revenue will be "comparable" to revenue in 2010, not taking the new order into account.

Arotech's share price closed at $2.52 yesterday, giving a market cap of $31 million.

Published by Globes [online], Israel business news - - on May 11, 2011

© Copyright of Globes Publisher Itonut (1983) Ltd. 2011

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