Brian Bradley
NS&D Monitor
11/6/2015
BWXT should be a “major player” in the next procurement of missile tubes for the Ohio Replacement ballistic missile submarine, which should also provide several opportunities for consolidation of the supplier base, BWXT President and CEO Sandy Baker said Thursday during his company’s quarterly investor conference call. BWXT—then Babcock & Wilcox—announced on Dec. 16, 2014, that Ohio-class Replacement prime contractor General Dynamics Electric Boat awarded B&W’s Nuclear Operations Group a competitively bid contract to manufacture a number of missile tube assemblies from an initial order for the Ohio Replacement. Baker said BWXT’s work on Ohio Replacement missile tubes is valued at $1.5 billion over the next 10-15 years.
Naval Sea Systems Command awarded the Ohio Replacement’s missile tube manufacturing contract to Electric Boat in November 2014. “These 17 missile tubes include four for the prototype quad pack and one for the Strategic Weapons Test Facility in Cape Canaveral, Fla., and 12 for the first of the class for our partners in the UK,” Naval Sea Systems Command’s Program Executive Office (PEO), Submarines, told NS&D Monitor in a January email. “Over the past four years we have competitively reconstituted the missile tube industrial base which had been dormant since the 1990s.”
BWXT capital expenditures are expected to increase to $55 million-$60 million for full-year 2016 to support Ohio Replacement work, according to a company press release issued Wednesday. Through September, BWXT had spent $41 million on capital expenditures in 2015, according to the release. BWXT Senior Vice President and CFO David Black during the conference call said expected capital expenditures for the Ohio Replacement—which could reach $25 million spread over a three- to four-year period—fueled the overall capital expenditure projections for 2016.
BWXT on Wednesday announced third-quarter 2015 revenue of $359 million, an increase of $21.6 million, or 6.4 percent, from the third quarter of 2014. BWXT’s Technical Services Group (TSG) revenue rose by $1.1 million from the third quarter of 2014, from $20.2 million to $21.3 million, while its operating income increased over that period by $3.4 million, to $8.3 million.
BWXT completed its split from Babcock & Wilcox Co. last month, separating the power generation spin-off B&W Enterprises from the newly named BWXT. The new company’s TSG business unit is responsible for managing contracts with DOE and the National Nuclear Security Administration (NNSA).
