EDO's New Facility To Support $240 Million Military Contract

At the recent ribbon-cutting for EDO Corp.'s new building on Daniel Island, CEO James Smith noted that the facility, at 50,000 square feet, will support the anticipated growth in the company's communications and networking systems business unit.

"Here we design and integrate voice and data communications equipment into end-to-end network solutions," said Smith.

The company's primary product and target market battlefield communications systems for Marine warfighters was evident by the attendance of U.S. Rep. Henry Brown Jr., South Carolina's First District congressman who serves on the House Veterans Affairs Committee. The U.S. government accounts for 82% of the company's sales, with 14% of sales going to international companies and foreign governments.

"EDO's mission to provide state-of-the art communications and networking systems to our nation's military is in keeping with our area's considerable history of contributing to the defense of our nation," said Brown.

EDO designs and manufactures a range of products and services for defense, intelligence and commercial markets. The company's market-driven structure is focused on six major market sectors: integrated systems and structures, undersea warfare, professional and engineering services, electronic warfare, intelligence and information warfare, and a sector known as C4 - command, control, communications and computers.

The Daniel Island facility is responsible for supporting the Transition Switch Module program, which is a key component of the military's network-centric battlefield communications strategy. In 2005, EDO was awarded a contract with a maximum value of $240 million for various configurations of TSMs for the U.S. Marine Corps. Another key product at this facility is the Joint Enhanced Core Communication System that EDO is producing for the Marine Corps. JECCS provides a mobile telecommunications central office, which is mounted on a Humvee that connects with the Defense Information Systems Network. The network gives individual marines full access to deployed communications networks.

EDO is hardly new to the Lowcountry. In the early 1990s, a company that EDO later acquired sent an employee to Charleston to work on a SPAWAR contract. By the late '90s, the Lowcountry operation had grown large enough for a 6,000-square-foot leased facility in Wando, which was later enlarged by another 8,000 square feet.

According to John Vollmer, a vice president at EDO, one of the company's critical success factors is the Department of Defense's transition from legacy computing systems to off-the-shelf commercial technology, which the Charleston facility was designed to provide. The current operation employs 50, with projected growth to 70 in 2007. EDO's recent contracts for this facility include an order from the Marine Corps for communications equipment installed on the Cougar family of mine-protected vehicles, which are manufactured by Ladson-based Force Protection Inc. The order, received in July, carries a base year value of $4.5 million with two option years, each with potential revenue of more than $5 million.

At the ribbon-cutting, Charleston Mayor Joseph P. Riley Jr. welcomed the company's expansion in the area."EDO, a well-established corporation with clear high-growth potential will bring new jobs and the additional prestige of being one of Forbes magazine's 25 fastest-growing technology companies," said Riley. "The investment of this large and diverse company is certainly a testament to the potential of our community and our commitment to careful growth and development."

Brown agreed, pointing to EDO's investment in the community as "an indication of their belief in our ability to provide the technical talent necessary for their operations."

EDO's 14 other offices build systems that are designed to jam radar and block radio and cell-phone signals that could be used to detonate roadside bombs. Those facilities also manufacture electronics for detecting ocean mines and guided missiles launched from airplanes.

Recent contracts for the other facilities include orders for radar simulators for the Canadian Air Force, worth approximately $2.4 million;a five-year task order for communications equipment to support the U.S. Army's unmanned aircraft, with a ceiling value of $37 million and $1.1 million initial funding; and a contract from Lockheed Martin for the fabrication of precision, advanced-composite structures for the F-35 Lightning II aircraft program, valued at $1.8 million. These contracts were all awarded in November.

EDO is headquartered in New York and employs 4,200 people worldwide. The company name is derived from the initials of its founder, Earl Dodge Osborn, who invented aluminum floats for seaplanes, started the company in 1925 and retired as chairman of the board in 1962. EDO had revenue of $648 million in 2005.

The company acquired two privately held defense contracts this summer. It purchased Huntsville, Ala.-based CAS Inc., a provider of engineering services and weapons-system analysis to the Defense Department, for $175.6 million. Days later it bought Nashua, N.H.-based Impact Science & Technology Inc., a provider of analysis support to the intelligence sector, for $124 million. Following the acquisitions, the company released a statement saying it expects 2006 revenue between $735 million and $750 million. In April, prior to the purchases, the company had forecast revenue between $680 million and $695 million.