EAC Gets a $10M MEDEVAC Contract

Zacks Equity Research
September 11, 2013

The provider of aviation services Erickson Air-Crane Inc. (EAC) received a contract from the U.S. Army to provide medical evacuation (“MEDEVAC”) service and support for the United States Army base at Fort Wainwright and Fort Greenly in Alaska. The contract value is $10 million. Fort Wainwright and Fort Greenly operate in extreme conditions where temperatures at times drop to -40°F. This makes medical evacuation all the more challenging.

Erickson Air Crane has the expertise and necessary equipment to carry out this specialized job. Erickson will provide dedicated aircraft, management and supervision, personnel, equipment, supplies, materials, tools, and transportation services to perform air medical evacuation and training.

Fort Greenly plays an important role in the U.S. Army’s development plans as it is the launch site for anti-ballistic missiles. With North Korea continuing with its intercontinental ballistic missile development program, defying pleas from the international community, the U.S. anti-ballistic missile program is gaining prominence. As a result, the U.S. Army might consider expanding its operations at the Fort Greenly base, thus necessitating more medical transportation services.

The MEDEVAC service will be available at these two army base 24x7. The dedicated Erickson team will take all necessary measures to transport injured personnel for better medical treatment. The contract is for one base year with one additional option year.   

Erickson Air-Crane recently received another contract from the defense establishment on the back of its expertise in heavy air lifting. In August 2013, the company received a five-year $36.6 million contract to provide comprehensive replenishment and logistics services to the Military Sealift Command.

Erickson Air-Crane currently retains a Zacks Rank #3 (Hold).  Other defense operators worth accumulating now are Alliant Techsystems Inc. (ATK), Elbit Systems Ltd. (ESLT) and Ducommun Inc. (DCO). Alliant Techsystems and Elbit Systems retain a Zacks Rank #1 (Strong Buy) while Ducommun has a Zacks Rank #2 (Buy).
 

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