Lockheed Martin (NYSE: LMT ) announced today it received a contract last month from the U.S. Navy to produce paveway II Enhanced Laser Guided Traning Rounds (ELGTR). The contract is estimated to be worth $84.5 million and will extend Lockheed Martin's delivery of ELGTRs to the U.S. Navy through 2018.
ELGTRs emulate "cockpit indications, release and terminal characteristics" of the paveway II laser weapon system, which provides crews with live-fire training so aircrews can practice delivery tactics in real-mission environments without depleting any actual tactical inventory -- important with today's range limitations and budget constraints. Lockheed has delivered more than 130,000 training rounds since its Laster Guided Training Round production began in 1992.
"Lockheed Martin remains committed to providing U.S. Navy aircrews with the most innovative, advanced and cost-effective training solutions," said Joe Serra, precision guided systems manager at Lockheed Martin Missiles and Fire Control. "We are nearing completion of multi-carriage ELGTR development, which will further increase training efficiency, proficiency and flexibility."
Despite sequestration defense budget cuts, that could total nearly $1 trillion over the next nine years, contracts such as this one make it clear that Lockheed's position as the largest defense contractor will limit hits to its profitability.