INDIANAPOLIS - Allison Transmission Holdings Inc. (NYSE: NYSE:ALSN), a global provider of commercial and defense vehicle propulsion solutions, has secured an $80.6 million contract to supply transmissions for the Abrams Main Battle Tank program in 2025. The deal includes the delivery of new and upgraded X1100 cross-drive transmissions for tanks used by the U.S. Army and its Foreign Military Sales clients. The contract adds to Allison's robust $3.2 billion revenue base and strong market position, reflected in its "GREAT" financial health rating according to InvestingPro analysis.
The contract, supporting the Joint Systems Manufacturing Center in Lima, Ohio, will aid in the production of new tanks and provide overhaul and repair kits through the Integrated Logistics Support Center at Anniston Army Depot. Dana Pittard, Vice President for Defense Programs at Allison Transmission, expressed pride in the company's continued partnership with the U.S. Army and international allies. The company's strong execution has contributed to impressive shareholder returns, with the stock delivering nearly 99% returns over the past year.
Allison Transmission will deliver new transmissions as well as upgraded ones that offer the latest configuration with zero miles on critical components, a move that is said to provide significant savings compared to new units. The contract also includes technical support for maintaining essential drawings and technical data packages, with deliveries expected throughout the 2025 program year. With a healthy current ratio of 2.83 and consistent dividend payments for 13 consecutive years, InvestingPro data shows Allison maintains strong financial discipline while growing its business.
Founded in 1915 and based in Indianapolis, Indiana, Allison Transmission is known for its medium- and heavy-duty fully automatic transmissions used in a wide array of vehicles, including on- and off-highway, buses, motorhomes, and defense vehicles. The company operates globally with manufacturing facilities in the USA, Hungary, and India, and has engineering centers in the United States and the United Kingdom (TADAWUL:4280). Trading at a P/E ratio of 13.2 with a market capitalization of $9.5 billion, the company demonstrates strong profitability with an EBITDA of $1.1 billion.
This announcement is based on a press release statement and contains forward-looking statements, which involve risks and uncertainties. Allison Transmission advises not to place undue reliance on these forward-looking statements, which speak only as of their date. The company does not commit to updating any forward-looking statement in light of new information or future events.
In other recent news, Allison Transmission Holdings Inc. reported significant year-over-year increases in net sales and income for the third quarter of 2024. The company recorded net sales of $824 million, a 12% rise from the same period in 2023, and net income reaching $200 million, up by 27% from Q3 2023. Also, the diluted earnings per share set a new record at $2.27.
Allison Transmission also declared a quarterly cash dividend of $0.25 per share on its common stock. The company further highlighted its revised full-year revenue guidance, now expected to fall between $3,135 million and $3,215 million.
In terms of strategic development, Allison Transmission has announced plans to invest over $100 million to expand its Chennai, India facility. The company has also forged strategic partnerships with Lugan and Ashok Leyland (NS:ASOK), contributing to its optimistic outlook.
These recent developments indicate a positive trajectory for Allison Transmission as the company expects to nearly double the manufacturing footprint in Chennai, India by 2026. Despite potential challenges in labor and supply chain, Allison Transmission maintains its focus on Class 8 vocational vehicle market leadership and expanding its presence in the defense sector.
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