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GD Receives $39.9M Contract

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General Dynamics Corporation’s (GD - Free Report) unit General Dynamics Information Technology has entered into a task agreement, worth $39.9 million, with the General Services Administration Federal Systems Integration and Management Center (“FEDSIM”) to deliver consolidated information technology (“IT”) enterprise services and support to the National Defense University (“NDU”). It is a five-year contract with utilization of all options.

Per the agreement, General Dynamics will provide enterprise service desk, data center and application support services to the NDU, which will enable NDU to apply IT resources more competently with least service interruption. In addition, the company will supply reliable information assurance services, network availability, systems engineering and network operation, and server administration and maintenance support.

FEDSIM is a collection of General Services Administration Project Management professionals, who are proficient to provide project, technical and acquisition related services to the federal consumers. The experts help customers to make their large and complicated IT projects through specialized Multiple Award Contracts.

NDU is an U.S. academy, which provides professional military education under the direction of the Chairman of the Joint Chiefs of Staff. Its aim is to teach the members of the U.S. armed forces by providing thorough joint professional military education.

Enterprise IT provides innovations in infrastructure consolidation and modernization, cloud computing, cross-domain information sharing, while offering a steady supply of new functions and IT services.

General Dynamics has a wide expertise in operating, managing and maintaining cost-effective enterprise IT solutions. As a sole-service provider to the NDU, the company always tries to deliver secured and highly sophisticated solutions.

During second-quarter 2012 earnings call, General Dynamics lowered its full-year 2012 earnings per share guidance range to $7.00 - $7.10 from its earlier projection of $7.10 - $7.20. This revision was primarily due to the possibility of a delay in the awarding of contract of Information Systems and Technology’s tactical communications business. At the end of second-quarter 2012, the company’s total order backlog was $52.4 billion, down from the year-ago backlog of $57.1 billion.

We are concerned about the challenges from defense budget cutbacks and the risks related to the execution of key projects, which might negatively affect the company’s forthcoming performance.  

General Dynamics Corporation currently retains a short-term Zacks #4 Rank (Sell).

Falls Church, Virginia-based General Dynamics Corporation engages in mission-critical information systems and technologies; land and expeditionary combat vehicles, armaments and munitions; shipbuilding and marine systems; and business aviation. The company operates through four segments: Information Systems & Technology, Combat Systems, Marine Systems, and Aerospace. The company competes with Lockheed Martin Corporation (LMT - Free Report) .

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