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Ceradyne Receives Multi-Year Commitment to Purchase Additional Ceramic Components for Diesel EnginesReceives $1.4 Million Initial Order, Estimates Four-Year Potential at $26 Million
BUSINESS WIRE - May 14, 2003 07:30
COSTA MESA, Calif., May 14, 2003 (BUSINESS WIRE) -- Ceradyne, Inc. (Company) (Nasdaq:CRDN) today announced that it has received a multi-year commitment from its largest diesel engine components customer to purchase sintered reaction bonded silicon nitride (SRBSN) ceramic components for additional areas of its diesel engines.
Ceradyne has received an initial order under this commitment for approximately $1.4 million, and expects to complete delivery of these components in the third quarter of 2003. If this program is successful, total orders under this commitment could be $26 million or more during the course of four years through 2006. Sales of diesel engine components to this customer during 2002 were approximately $2.7 million.
Ceradyne currently produces ceramic cam followers for the fuel injector area. Under the new commitment, which represents threefold the number of Ceradyne components used in each diesel engine, the customer will purchase additional cam followers for the intake and exhaust areas of large Class 8 diesel truck engines.
Initial production and shipments will be from the Company's advanced ceramic operations facility in Costa Mesa, Calif. However, the Company plans to construct a new factory adjacent to its Semicon Associates facility in Lexington, Ky. This expanded capacity is expected to accommodate the overall increase in SRBSN production requirements.
John Mangels, Ceradyne director of sales and marketing, commented: "We are very pleased about this decision to expand the use of Ceradyne SRBSN components in diesel engines. Ceradyne cam followers have been a regular production component for more than three years and have offered excellent performance and reliability on the road. We are also proud to contribute to increasing engine efficiency and reducing air pollution." |
