- Deal announced late on Friday
- GE had closed up nearly 1% before news
- Fourth-quarter earnings had missed expectations
General Electric Co.’s aviation unit has been awarded a contract with the US Army worth $517m. The company won the deal on February 1, and it is expected to reach completion by 2024.
Late on Friday, the Department of Defense revealed the new arrangement, which will see GE begin the program to provide turbine engines this year.
Based in Lynn, Massachusetts, General Electric Aviation has been awarded the contract for engineering and manufacturing the development phase for a project that has been dubbed the Improved Turbine Engine Program.
With a completion date set for August 1, 2024, research and development will start some time during fiscal 2019 after funds for testing and evaluation are granted. The funds are expected to be around $130m in total.
The contract was awarded by The Army Contracting Command based at Redstone Arsenal, Alabama.
Contracts awarded by the Defense Department that are valued in excess of $7m are generally made after 5pm. Before the news of the new deal was announced, shares of GE had closed up nearly 1% on Friday at $10.19.
Founded in 1892 and trading for 126 years, General Electric Company (GE) is an American multinational that operates across several main sectors. Last year, the company’s gross revenue placed it as the 18th largest firm in the U.S. among the Fortune 500.
The new contract announcement follows the release of GE’s fourth-quarter 2018 earnings, which came out on January 31. The figures showed adjusted earnings per share of 17 cents, which was short of expectations. Adjusted yearly earnings per share stood at 65 cents, while revenues for the quarter were almost $33.3bn.