Raven to Clip EMS Unit's Wings PDF Print E-mail
Written by Mike Buetow   
Thursday, 12 April 2012 07:30

SIOUX FALLS, SD -- Raven Industries will realign its contract assembly business unit, integrating it into its existing aerospace and applied technology units, the company said today.

Assets and team members of Raven's Electronic Systems division will be deployed into the company's Aerostar and Applied Technology divisions in order to better align Raven's corporate structure with its mission and long-term growth strategies, said the company in a press release.

Electronic Systems has historically held a complementary position at Raven.

Aerostar will add contract electronics manufacturing services to its capabilities and Applied Technology will continue initiatives related to proprietary product lines. Over time, approximately 75% of Electronic Systems' sales will go to Aerostar, the restructuring will not have a substantial impact on employment, and no material one-time costs are anticipated. After the realignment, Raven Industries will continue with its core growth divisions: Aerostar, Applied Technology, and Engineered Films.

According to Dan Rykhus, President and CEO of Raven Industries, "The transition will result in more growth potential long-term and enhance our capacity to serve the needs of Electronic Systems Division's customers moving forward."

Raven had net income of $50.6 million on sales of $381.5 million for the 12 months ended Jan. 31. The EMS unit saw sales rise 9% to $71.7 million, and operating income rose 14% to $11.3 million. The move comes as a bit of a surprise, given the EMS unit's EBITDA is 15.7%, among the highest in the industry.

 

 

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