On Thursday, Lockheed Martin (NYSE:LMT) confirmed receipt of a $755.1 million firm-fixed-price contract for the production of Patriot PAC-3 missile defense systems, originally announced by the Department of Defense last week.
At the time of last week's announcement, the destination of the Patriots had not been made clear. Lockheed's statement clarifies that the contract is actually for two customers. First, funds are being disbursed for Fiscal Year 2013 production of Patriot missiles and command launch systems for the U.S. Army. Additional missiles are destined for Taiwan.
In all, Lockheed has been tasked with producing 168 PAC-3 Patriot missiles and 27 launcher modification kits (used to upgrade existing Patriot air defense systems with PAC-3 Missile Segments). Lockheed will also provide program management and services to the U.S. Army. Deliveries are to begin sometime in the first half of 2014, and should conclude by July 31, 2015 .
The PAC-3 Missile Segment consists of the PAC-3 Missile, a highly agile hit-to-kill interceptor, the PAC-3 Missile canisters (each of which hold four PAC-3 Missiles, with four canisters per launcher), a fire solution computer, and an enhanced launcher electronics system and launcher support hardware. Lockheed is the prime contractor upgrading Patriot systems to the PAC-3 configuration.
Rich Smith has no position in any stocks mentioned. The Motley Fool owns shares of Lockheed Martin. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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