A subsidiary of aerospace defense contractor Kratos Defense & Security Solutions Inc. won a $49.6 million contract to provide 55 of its aerial target drones to the U.S. Navy.
San Diego-based Kratos (Nasdaq: KTOS) subsidiary Kratos Unmanned Systems division announced Thursday it won the contract for drones it builds in Sacramento.
“Since becoming an aerial target system provider in the early 2000s, Kratos has produced and delivered well over 1,000 high-performance jet target aircraft across our family of systems and customers," said Steve Fendley, president of the Kratos Unmanned Systems division, in a news release.
In addition to the 55 new aircraft, the contract also includes mission kits, certain flight consumables and technical data, the company said.
Kratos ranks sixth on the Business Journal’s list of largest manufacturers in the Sacramento area, with about 450 local employees. It has local manufacturing in Sacramento County, at McClellan Park, and an engineering division in Roseville.
This is "lot four" of a contract order, and Kratos said the work would be performed in Sacramento and Fort Walton Beach, Florida. The contract also includes options for lots five through seven. If all options are exercised at the maximum production quantities, it would be a total contract value of $227.6 million, said Don Blottenberger, program manager for the Navy's Aerial Targets program office, in a news release.
Kratos stock rose $1.51, or 13.2%, to $12.98 on Friday.
The Navy uses the target drones to practice shooting down advanced subsonic anti-ship cruise missiles.
Some of the target drones Kratos builds can fly at just under the speed of sound at altitudes from 7 feet over sea level to 40,000 feet. The drones don't land. Rather, they parachute back to earth for reuse.
Kratos’ Sacramento operations received nearly $50 million in orders for tactical drones in 2022, more than $51 million in orders in 2021 and $90 million in orders in 2020. In 2019, Kratos took more than $100 million in a series of drone orders, and it got more than $117 million in a series of orders for tactical drones in 2018.
