NORTH CANTON, Ohio, Feb. 15, 2016 /PRNewswire/ -- The Timken Company (NYSE: TKR; www.timken.com) has received a multi-year contract from the U.S. Department of Defense to provide engineering and supply Philadelphia Gear® main reduction gears (MRGs) for the Navy's next generation of Arleigh Burke DDG 51 class ships. The fixed-price contract includes options which, if exercised, could bring the cumulative value of the contract to more than $1 billion over its life.
"We've worked alongside the U.S. Navy for many decades and are proud to continue supplying our engineering expertise and Philadelphia Gear products and services for this important class of multi-mission ships," said Carl D. Rapp, vice president of the Power Systems group for Timken. "Philadelphia Gear won the contract to supply MRGs for the re-start of the DDG program in 2010 and, through the years, we have strived to deliver a quality product, on-time, and provide fleet support globally wherever the Navy serves our nation." More than 60 DDGs are in service today.
"As a result of our work with the Navy, our teams are prepared to meet the challenge of building reliable propulsion drives to support the demanding mission requirements of the DDG class for years to come," Rapp said. While no specific quantities were provided in the contract issued by the Department of Defense, Rapp anticipates that Timken will provide Philadelphia Gear MRGs for new DDG ships over roughly the next decade.
The Timken Company acquired the assets of Philadelphia Gear Corp., a recognized leader in high-performance gear drives, components and related services, in 2011. The company expects that sales under this contract would not begin until 2017, with total sales ultimately dependent upon the number and timing of options exercised by U.S. Navy officials.
About The Timken Company
The Timken Company (NYSE: TKR; www.timken.com) engineers, manufactures and markets bearings, transmissions, gearboxes, belts, chain and related products, and offers a spectrum of powertrain rebuild and repair services. The leading authority on tapered roller bearings, Timken today applies its deep knowledge of metallurgy, tribology and mechanical power transmission across a variety of bearings and related systems to improve reliability and efficiency of machinery and equipment all around the world. The company's growing product and services portfolio features many strong industrial brands including Timken®, Fafnir®, Philadelphia Gear®, Carlisle®, Drives® and InterlubeTM. Known for its quality products and collaborative technical sales model, Timken posted $2.9 billion in sales in 2015. With more than 14,000 employees operating from 29 countries, Timken makes the world more productive and keeps industry in motion.
Certain statements in this release (including statements regarding the company's estimates and expectations) that are not historical in nature are "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995. In particular, the statements regarding the company's expectations for the cumulative sales under the contract, the length of the contract and the level and timing of sales are forward-looking. The company cautions that actual results may differ materially from those projected or implied in forward-looking statements due to a variety of important factors, including: the expected level and timing of the procurement of products and funding thereof by the U.S. Department of Defense; risks related to reductions in government expenditures; risks related to production or shipment delays; and changes in technology that could reduce the expected demand for these products. Additional factors are discussed in the company's filings with the Securities and Exchange Commission, including the company's Annual Report on Form 10-K for the year ended Dec. 31, 2014, quarterly reports on Form 10-Q and current reports on Form 8-K. Except as required by the federal securities laws, the company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
SOURCE The Timken Company