Ultralife powers up Army's high-tech gear
By Arthur Zaczkiewicz
Electronic Buyers' News
(05/03/00, 10:30:32 AM EST)
ebnews.com
Lithium-battery maker Ultralife Batteries Inc. has heeded the
call of Uncle Sam.
In the next few months, the U.S. Army will be equipping
soldiers with high-tech gear for a special training exercise in
September. Among the gear is an integrated helmet
assembly that includes a computer and a sensor display to
enable soldiers to view maps, troop locations, and other
information.
Eventually, the Army would like to equip all of its foot soldiers
with the system, which also includes a video camera and a
thermal weapon sight designed to increase battlefield
effectiveness while offering greater protection. The system
allows a soldier to peer around a corner, aim at a target,
duck for cover, and then fire a guided weapon without fully
exposing himself to the enemy.
Ultralife Batteries, Newark, N.Y., has snagged two contracts
with the U.S. Army to supply power for this system, which
falls under the Army's Land Warrior Program.
Ultralife is using a pouch-style design for the batteries, a
technology that it sees as having applications beyond
military use. Aside from the Army contracts, Ultralife is
seeking to develop its presence in other segments of the
military market as well as to continue to develop its other
product lines, according to Julius Cirin, director of marketing.
Although Ultralife doesn't disclose sales by market, Cirin
said that ÿright now, sales to the military are still a relatively
small percentage of our total sales. But we expect that to
grow.ÿ
The company has previously supplied the Army with
batteries, but the two new contracts could evolve into larger
sources of revenue for Ultralife as the Army strengthens its
commitment to the Land Warrior Program. The Army is
planning to acquire 34,000 of the helmets by 2003, at a price
of $2.1 billion.
The contracts also arrive at a critical time for the company,
which is still working off inventory of its 9-V battery. This hit
Ultralife's bottom line hard with a $3 million loss in the
second quarter, ended Dec. 31.
The company also incurred one-time costs related to a
lawsuit filed by investors several years ago seeking to buy
the same battery company in Europe that Ultralife was
pursuing. The case was dropped in January.
But in the midst of all this, Ultralife's sales continue to grow.
In the second quarter, revenue increased 29%, to $6.7
million from $5.2 million in the prior-year period. The
company reported its third-quarter earnings last week, after
press time.
Key to moving forward and increasing profitability is a
commitment to R&D, Cirin said. The company spends about
16% of its revenue on R&D, which led to the development of
the lithium-manganese-dioxide pouch battery for the Army.
This technology involves taking the same chemistry found in
cylindrical cells and replacing it with a rectangular design.
The idea is to maximize the space in the battery cavity of an
end product by filling in the area not used by traditional
cylindrical cells.
Aside from the Army's program, Cirin said there are other
applications in the military market, such as field radios, mine
detection, and sonar buoys, that suit the design. The pouch
battery can be used in any application employing a
cylindrical design, Cirin stressed.
Those applications include emergency locating devices for
aircraft or automatic external defibrillator, he said.
Aside from its disposable lithium batteries, the company is
also readying itself for the commercial launch in the next few
months of a line of rechargeable polymer batteries. The
company is targeting the new line at the
consumer-electronics, computer, and wireless markets.
Ultralife was founded in 1991 on the basis of the acquisition
by a group of investors of Eastman Kodak's lithium-battery
division. Ultralife went public in 1992. Primary manufacturing
is at its plant in Newark, and the company has a plant in
Abingdon, England. Both are ISO-9001 certified.
Distribution is direct for sales to the military, Cirin said. The
company also uses distributors such as Allied Electronics,
Mouser Electronics, and Newark Electronics.
Cirin said the company is comfortable with its market
position. Serving end users such as the U.S. Army allows
Ultralife to improve its top line without getting tangled in more
price-sensitive markets, he said. |
