3SOF

pullback today (as expected)

Pulling back more today... Looks like a good buying opertunity may be around the corner, 10s possible?

great stock!

chart update,

update:

1)
New Partnership Aims to Speed Armored Vehicle Production
By KRIS OSBORN
Special Report: 1,000 Ship Navy
Force Protection, the maker of the popular Cougar and Buffalo armored vehicles, on Dec. 21 formed a joint-venture company with General Dynamics Land Systems to win a U.S. Marine Corps contract to build thousands of Mine Resistant Ambush Protection (MRAP) vehicles.
While the initial contract value is to be $770 million, the total value of the program could be as much as $10 billion, sources said.
The 50-50 joint venture, to be concluded within a month, will allow the companies to address a key Marine Corps requirement for the program — rapid delivery of vehicles to meet wartime demands in Afghanistan and Iraq.
"The idea is to merge Force Protection's proprietary designs with GDLS's manufacturing and technological capacity," said Michael Aldrich, Force Protection's vice president. "Buying enough steel to meet the demand has been a challenge, GDLS brings buying potential in the steel market ... We feel a tremendous obligation to meet the needs of the war fighters as quickly as possible."
According to executives for the two firms, the alliance will allow production of Cougar vehicles to increase from 40 now being built per month by Force Protection at its plant in Ladson, S.C., to 200 a month with GD.
By 2008, the joint venture aims to be building up to 300 vehicles a month.
Spearheading the rushed acquisition is the Marine Corps Systems Command, which stepped up MRAP orders in September, and in recent weeks total requests for production (RFP) have risen from several hundred up to about 4,100 vehicles, Marine Corps officials said.
"We quickened the pace because we recognized the urgent and compelling need," said Capt. Jeff Landis, a Systems Command spokesman at Marine Corps Base Quantico, Va. Force Protection is known for the blast-deflecting V-shaped hull featured on the 23-ton Buffalo and the 14-ton Cougar vehicles, about 300 of which are in use in Iraq and Afghanistan. GDLS is the nation's leading armored vehicle maker, building the Army's Stryker family of armored vehicles and upgrading the service's venerable M1 tank.
Over the past several years, the vehicles have been subjected to some 2,000 attacks from improvised explosive devices, rocket-propelled grenades and mines. The Cougar vehicle was first used in 2004 by I Marine Expeditionary Force units in Fallujah.
The last time GD forged a joint venture was when it partnered with General Motors Defense Canada in 2000 to build the Interim Armored Vehicle that eventually that came to be known as the Stryker. The initial Stryker contract was valued at $4 billion for 2,131 vehicles and the alliance paved the way for GD to acquire the London, Ontario-based GM unit for $1.1 billion in 2003.
"We're pleased to be partnering with a strong Force Protection team to deliver a MRAP vehicle that will be used to safeguard servicemen and women," said Peter Keating, a GDLS spokesman. "It is an opportunity to use the skills and resources of both companies to the best advantage of our customers."
link:
http://www.defensenews.com/story.php?F=2439211&C=america

2)
Army Due $50 Billion More in '07
InsideDefense.com NewsStand | Daniel G. Dupont | December 21, 2006
The Army is due to receive more than half of a $99.7 billion supplemental funding request prepared for Congress by the Pentagon, according to documents and sources.

The Army´s share includes more than $18.5 billion for operation and maintenance costs covering the active Army and the National Guard and Reserve. The service is also slated to receive $20.8 billion for procurement, with more than one-fourth of that total ($5.4 billion) earmarked for tactical and support vehicles, which are being used up at historic rates in Iraq and Afghanistan.

The supplemental request figures are included in a program budget decision, No. 711, covering the fiscal year 2007 global war on terror supplemental request, expected to be submitted to Congress in February.
The Pentagon comptroller approved the PBD on Dec. 7, according to sources familiar with it.
Operations in Iraq and Afghanistan account for the vast majority of the funding included in the supplemental. According to the document, reviewed by InsideDefense.com, the PBD allots $41.5 billion for operations -- mostly personnel expenses, including pay -- $26.7 billion for reconstitution; $10 billion for force protection; and $9.75 billion for Iraq and Afghan security forces.
A total of approximately $3.7 billion is set aside for Army and Marine Corps brigade and regimental combat teams; another $2.5 billion is earmarked for efforts to defeat improvised explosive devices.
The Army, which has made its desire for more funding very public in recent months, is the unsurprising winner of the most money in the supplemental request because its forces are widely acknowledged as overly stretched by commitments in Iraq and Afghanistan. Last week, Chief of Staff Gen. Peter Schoomaker told a commission on the National Guard and reserves that the service was underfunded by the Bush administration in recent years, leading to readiness shortfalls.
Frankly, we entered this war flat-footed, he said. Investment accounts were underfunded in the Army by approximately $100 billion, resulting in nearly $56 billion in equipment shortages across the Army.

In recent weeks, the service submitted a revised budget plan to the Office of the Secretary of Defense that included more than $3 billion in cuts to the Future Combat System, as well as numerous program terminations and decrements -- all moves the service insists it was forced to make because it has not received sufficient funding from the White House and the Pentagon.
The service also issued a stark warning of serious risks to the future of the force, according to sources and documents.
Some relief is due from the supplemental, assuming the new Congress approves it next year. In particular, the service is expecting a major procurement boost to replace, repair and reset equipment lost or damaged in operations abroad. The $20.8 billion in procurement funding set aside in the PBD includes $5.4 billion for vehicles, primarily trucks, as well as $3.9 billion for wheeled and tracked combat vehicles -- a funding account traditionally dominated by Strykers, Bradleys and Abrams tanks, all of which are in heavy use.

Other procurement accounts are also due for infusions of cash, according to the PBD. It sets aside $691 million for Army aircraft, $861 million for missiles and $681.5 million for ammunition.

The PBD does not break down where the funding would be spent within the procurement accounts.

As for the other services, the Air Force receives the second-largest chunk of operation and maintenance money in the PBD, with $7.7 billion set aside for the active-duty force. The Navy´s O&M allotment is $3.8 billion, the Marine Corps $1.3 billion.

Procurement coffers for the Air Force would be increased by more than $5 billion, with most of that money -- $3.9 billion -- slated for aircraft replacements, modifications and support.

Navy aircraft procurement money in the PBD amounts to approximately $3 billion; total Marine Corps procurement money is $2.2 billion.

A total of $34 billion is earmarked for service and defense-wide procurement programs.

Each of the services is slated to receive some research, development, test and evaluation money, as well: $1.6 billion for the Air Force, $483 million for the Navy and $164 million for the Army.
Bloomberg News reported details on the supplemental request earlier this week.
link:
http://www.military.com/features/0,15240,120982,00.html

I am a long term FRPT investor 

David, Michael, what kind of facts do you need to be convinced?

Terliso: MACD crossing alert
cheers
Oliver

up 9% again 

I will double my FRPT position soon,
too much good news for 2007 in the pipeline IMO.

please check amstocks82 update on IV:
http://www.investorvillage.com/smbd.asp?mb=132&mn=17850&pt=msg&mid=1098766

MAY THE FORCE BE WITH YOU (all) 

I have told you 

additional FRPT information from IV board:
A)
Existing and Future Contracts/Acronyms/New Investor Info

Here's the frpt_inv list of existing and reasonably likely future contracts for FRPT, as of 12/15.

Includes updates for the 12/1/06 8-K, located at
http://www.sec.gov/Archives/edgar/data/1032863/000110465906078791/a06-24859_18k.htm

If you are a new shareholder of FRPT or just heard of it and considering a purchase, you have found a company with a lot of potential. FRPT recently received a 280 vehicle contract, but there are much larger orders in the pipeline, leading to a projected at least tripling of revenues in 2007 vs 2006. Near term the biggest deals are the Mine Resistant Ambush Protected (MRAP) contract with a Force Protection 8-K confirming the quantities could be up to 22,000 Cougars and the Medium Mine Protected Vehicle (MMPV) with possibly over 600 Cougars. This is over $10 Billion of potential contracts, for a company with under $1Billion market cap.

In summary,
1) FRPT is completing delivery on a 79 Cougar JERRV order and a 41 Buffalo order and supporting vehicles under current contracts.
2) Ramping up on the first 199 of 525 Cougar ILAV's they'll build, 86 Cougar Mastiffs, 200 Cougar JERRV and 80 Buffalo orders.
3) Applying for an MRAP contract of up to 4100/22000 vehicles, an MMPV contract of up to 260/600+ vehicles and a Product Support Integrator contract to provide additional support for their vehicles.
4) Supporting Cheetah evaluations for the JLTV round of contracts.

Check out the following summary for lots of details and links for background research.

Note: Line items within a product are approximately ordered based on confidence, i.e. awarded contracts first, soon to be awarded next, followed by likely or possible. Backlogs are as of October 1. References to the previous messages and links provide further details and justification so that you don't have to just trust me. If you have time, you may want to spend some time reading the background messages and links as well. The RB message numbers refer to messages on Raging Bull's FRPT board and IV for messages on Investorvillage's FRPT board. An acronym dictionary is at the end of the message. This is detailed enough you may want to print it out first, then come back to follow the links.

Cougar (Non-ILAV)
http://www.forceprotection.net/models/cougar/
The Mastiff is based on the 6x6, the HEV on the 4x4 and most JERRV's are based on the 6x6, but some are 4x4.
1) 100 JERRV to be delivered between Nov 06 and Nov 07. Part of the $125Million delivery order on $214 Mill contract awarded Nov 06.
http://www.forceprotectioninc.com/news/news_article.html?id=133
2) Delivery award for the second 100 JERRV on the Nov 06 contract. Awarded. $69 Million.
http://www.forceprotection.net/news/news_article.html?id=142
3) 86 Mastiff PPV for the British. $65Mill awarded. Deliveries ahead of schedule and to be complete by 5/8/07.
http://www.forceprotection.net/news/news_article.html?id=117
http://www.defenseindustrydaily.com/2006/07/britain-buying-new-land-vehicles-for-iraqi-afghan-theaters/index.php
http://www.forceprotection.net/news/news_article.html?id=136
12/1 8-K says this order is actually for over 90 vehicles.
4) 15 JERRV to be delivered in 3Q-4Q06, $9.3Mill awarded. 4 remain in backlog.
http://www.forceprotection.net/news/news_article.html?id=95
http://www.forceprotection.net/news/news_article.html?id=106
5) Delivery award for 16 more JERRV as the May 06 contract was for up to 79. $10Mill. This appears to have already been quietly awarded as FRPT are including the 16 in the backlog on this contract.
6) 1 HEV remaining to be delivered. $400K. awarded. This one is left over from a previous contract and keeps getting pushed out, perhaps waiting for another larger HEV order.
7) An additional 100 JERRV to be delivered between Nov 06 and Nov 07. JERRV balance on the $214 Mill contract awarded Nov 06. Per SEC filings and press release, FRPT expects to be awarded and is already treating it as if it has been awarded.
The 2600 Category II vehicles of the MRAP RFI have been specifically described as similar to the 6x6 JERRV's. RFQ response due in December 18th, with award to follow some time after that. Funded by $228 Million and $299Million line items in 2007 budget and likely other funds in the 2007 defense supplemental. Considering the JERRV has already been well tested in the field, and the desire is to commit funds before end of year, (IV4625) the initial delivery order could be large. 2600 vehicles is approximately $1.3-1.5 Billion over the 2 year life of the contract. 12/1 8-K added that this is now an up to 13,000 vehicle opportunity.
The 6x6 JERRV's have been selling for $650K+ each, even at a $550K volume discount, this is an over $7 Billion dollar opportunity.
MRAP details are at http://www.fbo.gov/spg/DON/USMC/M67854/M67854MRAP/listing.html and http://www.fbo.gov/spg/DON/USMC/M67854/M6785407R5000/listing.html
My MRAP competitive analysis is at IV 13359
There were news articles that confirmed FRPT is planning to apply for MRAP and is partnering for the manufacturing capacity. One was copied into post IV11169.
9) Per the 12/1, 8-K, it apppears FRPT has chosen to go with the proven, in production product for Category I of the MRAP and will be bidding the Cougar 4x4. The expected volumes are a minimum of 1500 vehicles, with an option to buy an additional 7500 vehicles. At $400K each, this could be a $3.6 Billion contract.
10) Ambulance Variant of Cougar recently announced. I expect contract will be included in the MRAP Category II award. http://www.forceprotection.net/news/news_article.html?id=126
11) The Army has an MMPV draft solicitation out for a 260 Vehicle contract with award projected in April 07. The vehicle is very similar to the JERRV and the MRAP class II vehicle, so they are discussing merging this vehicle in with the MRAP program. Approximate value $125 Million. Likely to need two MMPV's for each Buffalo awarded to form a GSTAMIDS convoy. According to the 12/1 8-K the needs for this one are now over 600 MMPV's instead of just 260.
http://contracting.tacom.army.mil/majorsys/mmpv/mmpv.htm
12) The Army is now forecasting needs for up to 21,000 vehicles as an interim until JLTV developed. Cougars called out as specific example. IV8316 and IV14892 This would be many Billion $. Meetings to be held in early 07.
13) Follow on order of more Mastiff for the British. Contract specifies details for 4 more, but press articles refer to the total order being for about 108, which would be 22. Approximate value $15 Million. Also, the initial order for 86 could be considered a test quantity with much larger orders possible next year as they prove themselves. See IV8805. The 12/1 8-K says the initial order is for over 90 vehicles, with an option to purchase an additional 18.

Cougar ILAV
The Cougar ILAV is the Cougar 6x6 chassis on two axles.
http://www.defenseindustrydaily.com/2006/06/bae-delivering-a-cougar-variant-for-iraqs-4454m-ilav-contract/index.php
1) Total IDIQ ILAV contract shared with BAE is for up to 1050 vehicles for up to $445 Million delivered by May 2008. DoD can initiate delivery orders up to that number fairly easily. Indication is that they will be issued as equiping the Iraqis with ILAV's is one of the keys to the US handing over control. Partership terms with BAE are: 50/50 production split with BAE. Royalty paid by BAE to FRPT for units BAE builds. 100% of the training and support contract to FRPT. After 1050, contract with BAE is complete, so FRPT can provide 100% of future ILAV's or renegotiate.
2) Initial delivery order of 378 units awarded. 2 of FRPT's 189 have been delivered.
http://www.forceprotection.net/news/news_article.html?id=103
3) Follow on delivery order for additonal 20 units awarded. None delivered yet.
http://www.forceprotection.net/news/news_article.html?id=128
4) Proposed sale of 600 ILAV's announced to Congress. Approximate value of $240 Million shared with BAE. Not awarded yet, TBD.
http://www.dsca.mil/PressReleases/36-b/2006/Iraq_06-69.pdf
5) Proposed sale of 276 ILAV's.
http://www.dsca.mil/PressReleases/36-b/2007/Iraq_07-09.pdf


Buffalos
http://www.forceprotection.net/models/buffalo/
1) 44 Buffalos to be delivered by Dec 07. Part of the $125Million delivery order on $214 Million contract awarded Nov. 06.
http://www.forceprotectioninc.com/news/news_article.html?id=133
2) Contracts for a total of 41 Buffalos were awarded in 06 prior to the Nov contract. Approximate contract value $30-40Million. Remaining backlog is 33 units.
http://www.forceprotection.net/news/news_article.html?id=78
http://www.forceprotection.net/news/news_article.html?id=79
http://www.forceprotection.net/news/news_article.html?id=131
3) Rental fees and toy license fees from appearance in the Transformers movie to come out in mid 07. Message RB75575
4) Delivery award for additional 36 Buffalos from Nov 06 contract to be completed by Aug 08. Portion of $214Million Contract. Per SEC filings and press release, FRPT expects to be awarded and is already treating it as if it has been awarded. Value $20 Million.
5) Sole Source award for up to 64 Buffalos from MRAP RFI. Date TBD (IV5568).
6) Should get a large portion of $200Mill for additional Buffalos (specific line item for mine clearance convoys in 2006 Supplemental).
7) Army procurement plans are to buy another 250 Buffalos between 2007 and 2009. Approximately $220Million. The Buffalo was officially made part of the FCS program for mine clearance and FRPT is the sole source. Message RB76355. These will show up under the GSTAMIDS line item in the budget.
According to the 12/1 8-K the Army has requirements for 180 Buffalos and they are expecting another Buffalo RFP soon.
9) British may start buying Buffalos as they gain experience with Cougars. Reference in one of the news articles.
10) The Buffalo is also used in the humanitarian mission of demining old battlefields so that they are safe for civilians. Once capacity allows, there is the possibility of additional Buffalo purchases for this use.
Note: For Buffalo items 5,6,7,8 it is difficult to tell how much of this demand is satisfied with items 1 and 4.

Cheetah (formerly MUV-R and MRUV)
http://www.forceprotection.net/models/cheetah/
1) Likely to get an initial production contract in 2007 to prove the vehicle. Then a larger award once testing is satisfactory.
2) Strong position to compete for the JLTV as it moves forward. JLTV is a many billion dollar, many year contract, that will take some time to roll out. see IV11135
3) British may also buy Cheetahs as we believe they have also evaluated them.

ILS/PSI (Field Support, Spares, Training, Maintenance, Repairs, Professional Services )
1) Buffalo ILS Contracts. $5Million for Buffalo spares. Awarded, $800K remaining.
http://www.forceprotection.net/news/news_article.html?id=80
2) ILAV ILS Contract: $25Million over the next two years, message 76773 Included in 378 unit award.
3) RFI for 5-year PSI support for 288 Buffalos and Cougars. Response was due August 14. IV11881. FRPT will win this one. Award date TBD.
http://www.fbo.gov/spg/DON/USMC/M67854/M67854RFICIED/SynopsisR.html
4) Additional ILS and PSI as number of vehicles in the field keeps going up. We will have over 1000 vehicles in the field within 12 months. See IV11091
5) Catalyst reports claim a high return on ILS/PSI, similar to how your auto dealer gets a high return on their service department. Repairs to the vehicle after an IED hit adds significantly to our revenue on an ongoing basis. See latest Catalyst reports on FRPT. http://catalystresearch.biz/ResearchFRPT.html
6) ILS/PSI revenue is somewhat based on total vehicles in the field. In other words, the revene from ILS/PSI would continue to grow every quarter, even if our vehicle shipments were to hit a steady state because the total number of vehicles in the field keeps going up.

Patent Licensing
1) Licensing Revenues from patent on blast protection for wheeled and tracked vehicles. In private negotiations.
FRPT Press release, on investor news page June 15. "The significance of this undertaking cannot be overstated, and we intend to fully exploit this opportunity," said Force Protection CEO Gordon McGilton. "Since the technology can be applied not only to our vehicles, but to virtually any wheeled or tracked vehicle, the potential size of the opportunity may actually exceed that of our vehicle market." Also described in
http://catalystresearch.biz/files/FRPT_Update_Report_06_19_06.pdf

Brief comments:
Can FRPT deliver the units for this many contracts?
According to Spartan call, Spartan is now delivering over 5 Cougar chassis/day. IV6398. According to 3Q results, three Cougar lines are now running. According to the 12/1/06 8K their current capacity is approximately 40 Cougar and 5 Buffalos per month.

FRPT recently announced partnerships with GD and AH to increase capacity dramatically. The GD partnership gives them access to a pool of skilled welders to build more capsules and the AH partnership gives them access to a pool of skilled truck assemblers for final assembly. In addition, FRPT has a partnership wiht Ultra Machine and Fabrication that is growing very quickly. FRPT continues to keep 100% of the high margin aftermarket business.

GD Announcement
http://www.forceprotection.net/news/news_article.html?id=135
AH Announcement
http://www.forceprotection.net/news/news_article.html?id=138
Ultra Machine and Fabrication
IV14226
http://www.investorvillage.com/smbd.asp?mb=132&mn=14226&pt=msg&mid=992531

This all confirms plans are in place and being executed to win the very high volume contracts. As we said months ago, the deal was get the production capacity in place and the orders will follow.

Additional Resources to review
Most recent announcement from company of over $10Billion in potential contracts in the pipeline.
http://www.sec.gov/Archives/edgar/data/1032863/000110465906078791/a06-24859_18k.htm
Force Protection Web Site: http://www.forceprotection.net/
Catalyst Financial Reports: http://catalystresearch.biz/ResearchFRPT.html
CE Unterberg Report: http://unterberg.com/research/news/091506FRPTInitiationWEB.pdf
Yahoo Group for Force Protection. http://finance.groups.yahoo.com/group/forceprotection/
Yahoo group has photos, files, contracts, and some message traffic. It could become our store for due diligence files if we started to post them there.
Spartan Q3 conference call. http://www.spartanmotors.com/webcasts.asp The most detailed conference call available describing Force Protection and Spartan's work over the last four months to more than triple Cougar capacity. See IV message 6398 for my summary.

Acronyms:

Vehicles
FCS – Future Combat System – Large Army program to define a new family of vehicles for the Army of several years from now.
GSTAMIDS - Ground Standoff Minefield Detection System. The convoy that includes a Buffalo and its supporting vehicles. An official program.
HEV – Cougar Hardened Engineer Vehicle. Based on Cougar 4x4.
ILAV – Iraqi Light Armored Vehicle. A Cougar 6x6 chassis on two axles instead of three. A troop transport designed to equip the Iraqi's so they can take over duties currently covered by US troops.
JERRV - Joint Explosive Ordnance Disposal Rapid Response Vehicle – This is a 6x6 or 4x4 Cougar used by the Explosive Ordinance Disposal and Combat Engineer Troops. These job of these troops is to disarm and dispose of IED's.
JLTV – Joint Light Tactical Vehicle –Program designed to replace the Humvee family of vehicles. Many billion dollar program in early stages of development.
Mastiff PPV- Mastiff Protected Patrol Vehicle. A Cougar 6x6 purchased by the British for their forces.
MPAV - Mine Protected Ambush Vehicle. A briefly used acronym that is equivalent to MRAP.
MRAP – Mine Resistant Ambush Protected vehicle. A series of three vehicles similar to the Buffalo, Cheetah and Cougar. Over 4100 vehicles currently planned.
MMPV - Medium Mine Protected Vehicle. Army program for a vehicle similar to the JERRV or Cheetah. Phrase has also been used to describe the RG-31, but don't think RG-31 will win the current contract.
MRUV – Mine Resistant Utility Vehicle. Used once or twice by FRPT to describe what is now called the Cheetah
MUV-R - Mine-protected Utility Vehicle / Rapid Deployable (MUV-R), now called the Cheetah.

Services
ILS – Integrated Logistics Support (Spare parts and supplies, routine maintenance service, repairs and training)
PSI – Professional Support Integrator. Delivers ILS plus more. See IV message 4617

Contracting Process
Delivery Award – Purchase order for X vehicles for Y dollars. Ship per schedule, or sooner.
CONUS - Continental US
IDIQ – Indefinite Delivery, Indefinite Quantity Award. For example a contract is awarded for up to 1050 ILAV's for up to $445 Million, locking in pricing and supplier. But need a delivery award to actual ship product.
OCONUS - Outside continental US. In FRPT's case, typically Iraq and Afghanistan.
RFI – Request for Information. An initial query to industry for "what do you have in this space"
RFP – Request for Proposal. A more direct query for a proposal for industry.
RFQ – Request for Quote. A direct query for a bid on a very specific product or service.

Customers/Partners/Regulators
AH - Armor Holdings. The Sealy, Texas plant owned by Stewart & Stevenson before S&S was acquired by AH builds military trucks.
BAE – British based defense contractor that is partner for ILAV. Formerly British Aerospace, but now has growing US presence due to acquisitions.
DoD – US Department of Defense
GD - General Dynamics. Lima Plant in Ohio builds several lines of armored vehicles.
MoD – British Ministry of Defense
SEC - Securities and Exchange Commission. The SEC is the agency responsible for administering federal securities laws in the US.

Basic Stock Investing and message boards
DD - Due Diligence. Investigating and validating the real prospects of a company rather than just buying based on hype. What you are doing right now, if you are reading this message closely and following the links.
BB - Bulletin Board. Where FRPT is currently traded, but not for much longer.
EOM - end of message. Used at the end of subject line when entire message is subject and body is empty. Saves reader the time of opening message.

Note: If you find this article educational/useful for new investors, please click recommend to flag it for them.

&

B)

If you are asking: "what is FRPT's backlog?" - it's approx $400m.

Some potential contracts are:

    * ILAV add-on - 600 vehicles with FRPT building 1/2; BAE building 1/2 paying $8k royalty per; FRPT receiving all ILS
    * MMPV - $200m or so
    * MRAP - worth up to approx $10b w/FRPT partnering with GD 50/50
    * GSTAMIDs - worth up to approx $1b

Refer to FRPT_inv's post for a more comprehensive list:

http://www1.investorvillage.com/smbd.asp?mb=132&mn=15394&pt=msg&mid=1033576

Couple things important to keep an eye one:

* Blast Manipulation Technology - are they making any progress in licensing this tech to others.  This would be a "force multiplier in more ways than one
* Cheetah orders - could be a vehicle included in the MRAP but not positive that will be the case or if there will be opportunities outside of the MRAP.  I calculate the Humvee replacement market (JLTV) to be a long term opportunity of about $45b.  I'd expect FRPT to team with someone to pursue
* Production updates - with existing agreements (GD, AH, SPAR and Ultra) and internal production capability, ongoing production expansion is key.  Naturally, the more vehicles produced, the more lives saved, the more revenue, the higher share price, the more long term ILS revenue, etc etc.  The articles discussing the MRAP are calling for 300 vehicles / month in 2008.  Assuming each goes for approx 750k and frpt is building 1/2 that is a annualized revenue run rate of $1.35B from this contract alone.


Happy trading in 2007 !!

cheers
Oliver

Applaud the pick, this was one of the greatest picks all year.  Quite a run.

While many S.C.public companies celebrate growth, other are mired in investigations
By BEN WERNER
[email protected]

The ball doesn't drop on 2006 until Sunday night, but the year has ended on Wall Street, and most of South Carolina's public companies saw their stock prices finish up from a year ago.

Many of the nation's major stock indexes finished 2006 with decent double-digit growth from the end of 2005 — a performance mirrored by South Carolina's 20 largest publicly traded companies.

As a whole, stock in these South Carolina-based firms finished 2006 13 percent higher than in 2005.

This year-over-year increase in stock prices was slightly better than the 12 percent growth reported for a similar list of companies at the end of 2005.

THE BIG WINNER

Ladson-based Force Protection has developed a product in high demand — armored vehicles favored by military for work in Iraq and Afghanistan.
Currently, the military is seeking bids on 4,000 armored vehicles that match specifications for Force Protection's Cougar vehicle.
The company also secured a private placement of 13 million shares of common stock, generating $152.75 million.
The day that private placement was announced, Force Protection's stock price jumped by $1 to close at $15.99 per share.
The cash is being used to expand Force Protection's Ladson manufacturing plant.

link:
http://www.thestate.com/mld/thestate/business/16346750.htm

News! CE Unterberg ups target - $17 to $25!
C.E. Unterberg Towbin Is Raising Force Protection Inc. 2007 Rev. Estimate To $392.9 million From $298.5 million
(RTTNews) - C.E. Unterberg Towbin Is Raising Force Protection Inc. (FRPT) 2007 Rev. Estimate To $392.9 million From $298.5 million

http://www.briefing.com/Investor/Public/MarketAnalysis/Calendars/UpgradesDowngra des.htm

nice start for 2007 IMO 

New Armored Vehicle Saves Lives In Iraq, Protects From IED Blasts
Wednesday January 3, 7:00 pm ET
Kevin Harlin

The venerable Humvee wasn't designed to take the abuse dished out daily on the streets of Baghdad. Force Protection says its vehicles are.

The Ladson, S.C., company (OTC BB:FRPT.OB - News) says its patrol vehicles -- essentially armored bank trucks on steroids -- could save soldiers from one of the main threats they face today: devastating roadside bombs.

A few hundred of its Buffalo and Cougar vehicles are already deployed by U.S., British and Iraqi forces. In December, it partnered with General Dynamics (NYSE:GD - News) to bid on the U.S. military's latest call for a mine-resistant, ambush-protected vehicle, or MRAP in military jargon.

If Force Protection wins its more than $1 billion bid to provide up to 3,600 vehicles over 18 months, it will be a massive undertaking for a company that produced just 50 vehicles in December.

General Dynamics

By marrying Force Protection's trucks with General Dynamics' fabricating capacity, the companies together can deliver large numbers of "the strongest, most advanced blast- and ballistic-protected vehicles in the world," Force Protection's Gordon McGilton said in a written statement.

Humvees weren't designed to bear the brunt of an explosion, particularly from underneath. The military is retrofitting those workhorses with armor plating, but casualties continue to mount.
Unlike Humvees, all of Force Protection's vehicles have V-shaped hulls -- a design first pioneered in South Africa that deflects blasts up and around the crew compartment.

That shape, and the heavy armor -- the company considers the exact makeup of the protective skin a military secret -- increase the odds that soldiers inside will survive.

The military suffered its first fatalities inside a Force Protection vehicle in an attack in November. Neither the company nor the military would elaborate, citing security.

But in most attacks the injuries have been minor, and many of the damaged vehicles have been able to return to base under their own power.

"It's the gold standard in protection," said Michael Aldrich, a Force Protection vice president. "We've been hit over 2,000 times now. So the jury has come back in and announced that they like the design and they believe in it."

The U.S. Army took delivery of the first Buffalos in 2003. These massive, 45,000-pound trucks, with 30-foot remote arms, are used to spot and disable improvised explosive devices -- the dreaded IEDs.

The middle-duty vehicle, the 30,000-pound Cougar, first entered service with the Marines in Fallujah in 2004 and is also used for hunting IEDs.

In December, the company raised $152.8 million in a private placement that it said will allow it to ramp up production of its newest and smallest vehicle, the relatively nimble 14,000-pound Cheetah.

Aldrich says the Cheetah will offer the same blast protection and will be able to better maneuver along narrow urban corridors.

As of December, the U.S. Marines already had 69 Force Protection trucks -- four Buffalos and 65 Cougars -- and funding approved for 805 more, Marine Corps Systems Command spokesman Bill Johnson-Miles says.

Johnson-Miles says accounts from Marines who survived blasts in them are a testament to the trucks' durability.

Force Protection's Aldrich said the success in the field has led to calls from NATO nations and the militaries of Middle East countries.

Ultimately the military plans to retire the Humvee completely, Johnson-Miles says. It hasn't yet put out specifications for the next generation of durable multipurpose vehicle. But Force Protection hopes its trucks, or variations on them, will make the grade.

Potential Market

If so, that would open the company to a potential $10 billion market to deliver 20,500 vehicles.
But capacity would have to dramatically improve first.
With General Dynamics' plants in Ohio and elsewhere, Force Protection said it expects to be churning out 200 vehicles a month by the middle of 2007, and up to 300 a month in 2008.
With capacity at its Ladson plant nearly maxed out, the company is looking for a new facility to manufacture its Cheetahs.

C.E. Unterberg Towbin analyst James McIlree says the order prospects look good in 2007, though he cautioned in a research note that the company could hit snags as it tries to ramp up production. He also noted that since the bulk of the business comes from the U.S. military, the company would be in trouble if its trucks lost favor, or were beaten by offerings from better-financed competitors.

McIlree's firm underwrote the company's December private placement.

Joe Maxa, an analyst with Dougherty & Co., wrote in a November research note that the management team at the 10-year-old company had limited experience together.

Force Protection trades as a bulletin board stock, but it has applied for listing on the Nasdaq Capital Market. In December it appointed a retired U.S. Army lieutenant general to its board, giving it the required majority of independent directors.

The company posted earnings of 1 cent per share in the third quarter, on revenue of $42.2 million, up from an 11-cent loss a year ago on sales of $9.3 million. Analysts had expected 4 cents per share in the third quarter.

Maxa attributed most of the shortfall to a delivery timing issue at the end of the quarter, and a delay in Buffalo production due to a customer's design change.

Analysts surveyed by Thomson Financial expect 7 cents per share in the fourth quarter, 11 cents for the year and 57 cents in 2007.

Force Protection, Inc. Marks Major '06 Milestones,
New Vehicle Production Record in December
Thursday January 4, 8:45 am ET

LADSON, S.C.--(BUSINESS WIRE)--Leading U.S. armored vehicle manufacturer Force Protection, Inc. (OTCBB:FRPT - News) continued to record substantial growth in contracts, vehicle deliveries, workforce, production capacity, and strategic partnerships during 2006, the company said today.
Force Protection's Buffalo and Cougar blast- and ballistic-protected vehicles marked more than three years in combat operations in Iraq and Afghanistan in the past year. There are over 300 vehicles currently deployed, more than double the number at the beginning of 2006.

"It has been an important and remarkable year for the company," said CEO Gordon McGilton. "We continue to reap the rewards of restructuring efforts begun in 2003 to become a high-volume assembly-line manufacturer with the capacity to produce the world's best protected vehicles in the numbers needed."
"Built on the foundation of partnerships with other leading defense contractors such as General Dynamics Land Systems, BAE Systems, and Armor Holdings, and the exponential expansion of our workforce and manufacturing infrastructure, Force Protection is positioned to meet the increasing demands for our blast protection technology as never before," said Chairman Frank Kavanaugh.

Force Protection's workforce has increased to more than 700, up from 300 in January 2005. The company delivered more than 50 vehicles in December 2006 alone, a 300% increase from December 2005.

"Our records show that we produced more vehicles last month than in all of 2003 and 2004 combined," added McGilton.

Total contract awards for the year have also multiplied, due in large part to a $214 million contract award from the Marine Corps Systems Command for approximately 280 Cougar Joint Explosive Ordnance Disposal (EOD) Rapid Response Vehicles (JERRV) and Buffalo mine-protected clearance vehicles announced November 10, 2006.

Force Protection received a $180 million Foreign Military Sales contract from the U.S. Army Tank-automotive and Armaments Command to manufacture 378 Iraqi Light Armored Vehicles (ILAVs). Force Protection is acting as subcontractor, with BAE Systems as prime contractor on the award announced June 5, 2006.

The company also marked expansion into the international defense market during 2006, with a $63 million dollar contract award from the British Ministry of Defense (MOD) for more than 85 specially designed Cougars, known by the British military as Mastiff Protected Patrol Vehicles (Mastiff PPV). The first round of Mastiff PPVs were presented to the MOD ahead of schedule on November 16, 2006.

In December 2006, Force Protection and General Dynamics announced a joint venture company, Force Dynamics, which was formed to compete for the Mine Resistant Ambush Protected (MRAP) vehicle program managed by the U.S. Marine Corps. The MRAP competitive action for the first year's estimated requirement of 4,100 vehicles has an approximate value of $2 billion.

The company has continued to expand its integrated logistics support (ILS) department and anticipates that this will be a further source of revenue in 2007. ILS is responsible for order fulfillment on spare parts, contract services and maintenance and training, as well as the deployment of Force Protection field service representatives. ILS revenues are expected to exceed $42 million for 2006.

"By every measure, Force Protection is fulfilling its commitment to do all that is necessary to get these life-saving vehicles to those who need them most," noted McGilton. "From the military to the media to the federal government, our vehicles are recognized as a proven solution to the threat of improvised explosive devices, land mines, and road side bombs. No other vehicle lines match those of Force Protection for troop safety. It is because of their performance in the field that the company continues to experience such phenomenal growth."

"We look forward to continuing this vital work for our customers in 2007," said Kavanaugh. "We are also excited at the opportunities to expand our business model and provide the best possible return for our shareholders."

"Cheetah orders - could be a vehicle included in the MRAP but not positive that will be the case or if there will be opportunities outside of the MRAP.  I calculate the Humvee replacement market (JLTV) to be a long term opportunity of about $45b.  I'd expect FRPT to team with someone to pursue"

Why this has not been mentioned by the government? I believe there is a study which was used to provide requirements for the Hummer replacement. The military wished for something smaller, with fuel economy for range, than the Hummer. Not bigger with shorter range like the Cheetah.