Alliant Techsystems [ATK] Dec. 19 announced the Army has notified the company of its intent to award a contract to operate the Lake City Army Ammunition Plant for four more years.
The new contract covers government small-caliber ammunition orders through September 2012, with deliveries on these orders scheduled for up to 18 months after receipt of the order, the company said in a statement.
“ATK is extremely proud of our stewardship of this national asset at such a critical time,” Mark DeYoung, President, ATK Ammunition Systems, said. “We have worked with the Army to successfully meet the nation’s increased need for small-caliber ammunition, while simultaneously developing and executing a plan to modernize the Lake City facility. This effort assures that Lake City remains a viable and dependable source of ammunition for decades to come.”
For the company, this is a strategically critical contract award. Because it will be an IDIQ contract and because contract negotiations have yet to begin, the company can’t project revenues over the four years. However, the most recent four years of the existing contract generated approximately $1.6 billion in revenue.
ATK has operated the Lake City facility since April 1, 2000. During this time, the company has delivered more than 6.8 billion rounds of 5.56mm, 7.62mm, and 50-caliber ammunition.
Working with the government, ATK increased annual plant production from 350 million rounds per year to over 1.4 billion rounds annually.
The ammunition produced by ATK at Lake City is an essential element of the nation’s efforts in the global war on terror.
Lake City Army Ammunition Plant is located in Independence, Mo. It was originally constructed in 1941 by the government as one of several government-owned ammunition plants. The plant is the nation’s primary production source for small-caliber rifle ammunition.