ATK (Alliant Techsystems)

Sea Power: Admiral, ATK has grown significantly through strategic acquisitions. How have these acquisitions strengthened the company's competitive position and future prospects?

Miller: First, having followed Sea Power for many years, it's a pleasure to report from the industry side of our common goal to provide the best capability possible for our fighting forces. I have been with this impressive company for four years--and we have improved every aspect of our business operations. Business growth has been spearheaded recently by some key strategic acquisitions.

Two acquisitions last year created national franchises in two legacy businesses--solid propulsion and ammunition. Another acquisition completed just recently has laid the groundwork for another franchise business that will meet the military's future need for precision capabilities, an area we all recognize will grow as the United States faces new security environments.

The acquisition of Thiokol Propulsion in 2001 made us the world's leader in solid propulsion systems, with a product portfolio that includes the Space Shuttle's boosters. We also acquired the commercial ammunition operations of Blount International, Incorporated--which, together with our military ammunition business, makes us the nation's largest manufacturer of ammunition.

Our most recent acquisition--the assets of Science and Applied Technology [SAT Inc.], now called ATK Missile Systems--has bolstered our precision capabilities by adding critical seeker, guidance, and systems-level expertise. We now have a presence across the full spectrum of capabilities that make up a precision-strike weapon, including propulsion, fuzing, gun-hardened electronics, warheads, seekers, and guidance and control. This acquisition has clearly positioned us to be a leading contributor to fulfilling the future precision needs of our armed forces.

ATK is leading an industry team that is developing the Autonomous Naval Support Round--or ANSR--which recently flew a world record 62 miles. How will this precision weapon meet the Navy's future requirements?

There is lots of "chatter" about our approach to providing this needed long-range capability to the Navy and Marine Corps. The capsule report is as follows: ANSR provides a ballistic trajectory, GPS-guided solution to the Navy's requirement for affordable, long-range, precise fire in support of ground maneuver warfare and expanded littoral warfighting capability. It differs from other approaches in its simplicity and relatively low cost, as well as its application to various gun types and calibers--including both the current 5-inch/54-caliber naval gun and the new 5-inch/62-caliber gun. We estimate that the ANSR unit cost in full-rate production will be less than $20,000--and its application to the existing inventory of 5-inch/54-caliber guns will enable rapid introduction throughout the fleet.

Importantly, the technology we have developed for ANSR is also applicable to other precision-projectile systems such as the Navy's 155 Advanced Gun System and the Army's Excalibur program.

What other ATK programs contribute to the military's requirement for standoff precision strike weapons?

Earlier this year, we formed the Precision Systems Group to bring together our precision capabilities and products, including extended-range gun-launched munitions, air-bursting munitions, and fuzes and sensors used in precision ordnance. The group, under the leadership of Dan Murphy, a retired Navy vice admiral, is well positioned across a broad set of programs that provide unprecedented capabilities for individual soldiers, armored vehicles, artillery, naval guns, and missile-defense interceptors.

We are particularly excited about the programs that came with the SAT Inc. acquisition, including the Navy's Advanced Anti-Radiation Guided Missile [AARGM], now under development as the successor to the HARM [high-speed antiradiation missile]. AARGM employs a multisensor guidance system capable of engaging enemy air defenses even after radar emissions are shut down.

Other key programs include the XM29 infantry rifle, which uses a laser rangefinder and advanced "turns-count" fuzing technology to deliver precision air-burst fire. We are also developing the Mid-Range Munition, a gun-launched guided munition.

What other Navy weapon systems are supported by ATK's capabilities?

We supply solid propulsion for tactical missiles, strategic missiles, and missile-defense interceptors. Key programs include the Evolved SeaSparrow Missile, Sparrow, Advanced Medium-Range Air-to-Air Missile, AIM-9X Sidewinder, Trident II [D-5] submarine-launched ballistic missile, and the Standard Missile-3 for the Sea-Based Midcourse Defense system.

Our fuzes and sensors are found on a number of precision-guided ordnance systems, including the Joint Direct Attack Munition [JDAM], as well as on conventional ordnance.

Where do you see ATK headed in the next five years--and how is the company positioned for the future?

We have a clearly defined strategic plan to grow annual sales to between $3 billion and $4 billion from our current $2.1 billion base. We will continue to generate double-digit earnings growth, and maintain disciplined operations and a strong financial posture.

We are proud to play a key role in our nation's human space-flight program. This is an anchor program at ATK. With our strong positions in other solid-propulsion and ammunition programs, ATK is serving the legacy requirements of today's military and aerospace customers. Our success in developing an equally strong position in precision capabilities will define the ATK of tomorrow and ensure that we will meet the military's future requirements.

Thanks for letting us talk about ATK in Sea Power. But, most importantly in this holiday season, let's remember in our thoughts and prayers--and send our very best wishes to--the men and women in our armed forces. This is another remarkable generation of great Americans whose motive to serve is God, family, and country. God bless them all in the time ahead. *