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More Articles:
1. Lockheed Martin Corp.
2. Northrop Grumman Corp.
3. United Space Alliance LLC
4. Computer Sciences Corp.
5. Raytheon Co.
6. Science Applications International Corp.
7. Electronic Data Systems Corp.
8. TRW Inc.
9. General Dynamics Corp.
10. AT&T Corp.
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Top 100 Federal Prime Contractors in IT
Top 100 home page: Government Market Sparkles In Gloomy Economy
Vance Coffman
Companies 1-10
1. Lockheed Martin Corp.
www.lockheedmartin.com � $3,317,769,000
For the seventh year in a row, Lockheed Martin Corp. is No. 1 on Washington
Technology�s Top 100 list, as the company used its breadth and depth of
expertise and market reach to move forward, despite some tough times.
�I think our largest strength just comes in the form of size. We have huge
groups of talented people,� said Bob Coutts, executive vice president of
Lockheed Martin�s systems integration business area. �We�re probably one of
the most, if not the most, technically competent companies [in the market].�
The company employs about 130,000 people, he said.
Financially, the world�s largest defense contractor realized $25.3 billion
in 2000 revenue, almost flat compared to 1999 revenue of $25.5 billion. The
company saw a net loss of $519 million, compared to 1998�s $382 million in
net earnings (which had plunged from 1998 earnings of $1 billion).
While 2000 was a low year for Lockheed Martin, the company should be
improving from here on out, said aerospace analyst Paul Nesbit, principal at
JSA Research, Newport, R.I.
�They�ve got a handle on their problems financially,� he said. �They really
lost it when they made so many purchases [over the past several years]. They
lost control on the management side, but now they�ve regained that.�
�A year ago, 18 months ago, Lockheed Martin was very extended, [and] our
debt to equity ratio was very unattractive,� Coutts said. �You�re looking at
a corporation who has essentially reduced net debt by somewhere between $3
billion and $4 billion.�
The company�s rebound is reflected in its stock price, which has almost
doubled from its 52-week low below $20 in April 2000. Lockheed�s annual
report states its backlog of business has grown 23 percent, to some $56
billion, while a spokesman said the company won more than $37 billion in new
contracts from the government last year.
Lockheed Martin Corp.
Based: Bethesda, Md.
Chairman & CEO: Vance Coffman
Employees: 130,000
2000 Revenue: $25.3 billion
2000 Net Earnings (loss): ($519 million)
1999 Revenue: $25.5 billion
1999 Net Earnings: $382 million
Lockheed Martin�s prospects aren�t completely rosy, Nesbit said. �They still
have problems in their space business, particularly satellites, and global
telecommunications services. They�re not making any money,� he said. �If
they had an easy way out, they�d probably get out, but it�s not that easy.�
Coutts estimated that systems integration work for the federal government
probably makes up well over $2 billion in corporate revenue, with the
company realizing an internal growth rate of 15 percent to 18 percent on its
IT projects.
He said Lockheed Martin�s IT businesses exist inside four different parts of
the company: systems integration (the largest group), space, technology and
services, and global telecommunications.
Among its big victories in 2000, Lockheed Martin won the Air Force�s
Integrated Space Command and Control contract, a $1.5 billion, 15-year
program to modernize the service�s air, missile and space command and
control systems used by the North American Aerospace Defense Command and the
U.S. Space Command. �That was our most major win,� Coutts said.
The company also won a $118 million contract with the FBI to provide
automated identification and information technology services for the agency�
s Criminal Justice Information Services division in Clarksburg, W.Va.
And the company holds a valuable spot on numerous governmentwide,
multiple-award contracts, including the National Institutes of Health�s
ImageWorld II electronic imaging and services contract, the Information
Technology Omnibus Procurement II contract handled by the Transportation
Department, and the General Services Administration�s Millennia vehicle.
But Lockheed Martin didn�t succeed in all its competitive efforts.
Electronic Data Systems Corp., Plano, Texas, landed the big plum in
government IT deals last year, the $6.9 billion Navy-Marine Corps Intranet
contract, while Lockheed�s team, headed by IBM Corp. of Armonk, N.Y.,
finished out of the money.
�Probably our big [disappointment] was not being on any of the teams for
NMCI,� Coutts said. �We were trying to cover our bases. Beyond that, but not
at that scale, I�m sure we lost some $5 million or $10 million [contracts].�
Over the years, the company has enjoyed the most success in the Defense
Department, Coutts said, while on the civil agency side Lockheed Martin has
provided services for the FAA, the Justice Department through its FBI
contracts, �and quite a bit of Health and Human Services.�
Prospects for the upcoming year include the Department of Housing and Urban
Development�s recompete of its 11-year-old Integrated Information Processing
Services contract, for which Lockheed Martin is the incumbent. The new
contract, renamed HITS for HUD Information Technology Services, will
potentially be worth up to $1 billion. The request for proposal may be
released this July.
Through the GSA�s Millennia vehicle, Lockheed Martin is hoping to win part
or all of the FBI�s Trilogy project, the three-year, $400 million effort to
modernize the capabilities and functions of the agency�s legacy equipment
and related IT capabilities into an integrated, advanced IT infrastructure.
The company also has teamed with IBM on the $2 billion, 15-year Customs
Modernization contract. The award is due soon.
Lockheed Martin has some interesting competitive challenges ahead. The
Boeing Co. announced early this year that its Air Traffic Control unit
intends to propose a complete overhaul of the FAA�s approach to solving
capacity and air traffic control problems.
At the same time, Raytheon Co. has formally protested the FAA�s decision to
award Lockheed Martin the contract for the agency�s En Route Automation
Modernization program, a 10-year contract worth hundreds of millions of
dollars.
For its part, Lockheed Martin has challenged Raytheon�s work on the FAA�s
Standard Terminal Automation Replacement System project, recommending that
its own Common ARTS air traffic control system be used instead.
There are government agencies where Lockheed Martin does not yet have a
presence, Coutts said. The company is looking for opportunities to remedy
that.
�Probably the places we�re not covering as much as we�d like to are
Agriculture, Veterans Affairs, Interior, Education, Labor and the State
Department,� he said.
Listing the company�s plans points up another of its strengths, Coutts said:
Lockheed Martin is prepared to bid on work as a prime contractor or to work
with other major systems integrators in a subcontracting role.
�We�re basically looking for wins,� he said.
� Patience Wait
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