Sikorsky eyes foreign deals to offset U.S. drop
FARNBOROUGH, England |
FARNBOROUGH, England (Reuters) - Sikorsky Aircraft, the helicopter maker owned by United Technologies Corp (UTX.N), on Sunday said it has a large backlog of international orders and sees good opportunities for growth in countries like Brazil, India, Turkey, China and Mexico.
Mick Maurer, who took over as president of Sikorsky on July 1, said revenue would be flat for several years due to a decline in U.S. military spending and the fact that several larger foreign orders were not slated for delivery until 2014.
"We're going to be fairly flat for the next couple of years and then it will start to pick up again as some of the international military market starts to kick in for us," he told Reuters in an interview on the eve of the Farnborough Airshow.
Maurer's predecessor, Jeff Pino, told investors in March that he expected revenue to drop by mid-single-digit percentages in 2012 after rising 10 percent to $7.4 billion in 2011.
Sikorsky was on track to finalize an eighth multi-year procurement contract to deliver different models of its popular Black Hawk helicopter to the U.S. Army, Navy and Air Force -- an important deal that should help facilitate several additional foreign sales, Maurer said.
He said the company had several large orders in hand from Australia, Taiwan and Saudi Arabia, among others, but those deliveries were not slated to begin until 2014.
Maurer said the parent company, which is selling several other units, remained committed to Sikorsky, despite the anticipated slowdown in U.S. defense spending, and there were no current plans to sell the helicopter maker.
"There's nothing on the horizon that I think would change that," he said, noting that Sikorsky had also diversified fairly aggressively in recent years to help offset a long-expected drop in U.S. defense spending.
Commercial and aftermarket sales now account for about 30 percent of Sikorsky's annual revenues, while military sales account for 70 percent.
Maurer said Sikorsky was working closely with the Canadian government to restructure its contract for 28 state-of-the-art Cyclone maritime helicopters to replace its aging fleet of Sea Kings, now nearing 50 years old.
The program has run into schedule delays and cost increases, but Maurer said he was confident that the company would be able to resolve its issues with the Canadian government on the most advanced and complex helicopter it has ever built.
He said the two sides were discussing a phased approach that would eventually give all 28 aircraft the capabilities required.
"I think we're going to work through it. The build of the aircraft is actually going quite well," Maurer said, noting that four aircraft had been completed, four more were in testing, and 13 others were in various stages of production.
"We're not too far apart. What we have to do is make the contract match the program," he said.
(Reporting By Andrea Shalal-Esa; Editing by Erica Billingham)
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