The Insider

By Marjorie Censer
July 31, 2019 at 3:56 PM

KBR said today sales in its government solutions unit in the most recent quarter reached $1 billion, up 19% from the same three-month period a year earlier.

KBR said the government solutions business saw 16% organic growth and also benefited from its acquisition of SGT. The company cited growth in its logistics business, continued disaster recovery work for the Air Force at Tyndall Air Force Base, FL, and expansion of its engineering business as growth drivers.

By Justin Katz
July 31, 2019 at 3:52 PM

The Pentagon conducted a dual-buy of the third and fourth Gerald Ford-class aircraft carriers earlier this year and stated the acquisition will save an estimated $4 billion, Inside Defense reported in January.

Before signing the contract with Huntington Ingalls Industries in January, the Defense Department was required to certify to Congress that a variety of requirements had been met.

Inside Defense now has a redacted copy of that November report that was sent to lawmakers. Read our original coverage of the two-ship buy.

By Sara Sirota
July 31, 2019 at 3:43 PM

The Air Force today released a request for proposals to manufacture the BLU-136/B 2,000-pound warhead, one of two area-attack weapons intended to meet policy on cluster munitions.

The maximum ceiling for the multi-award, indefinite-delivery, indefinite-quantity contract is $600 million over a seven-year ordering period. Performance will not exceed three years after the end of this time frame, according to the RFP's statement of work.

This new weapon will be compatible with the existing GBU-31 Joint Direct Attack Munition guidance system and the DSU-33 height-of-burst sensor. It will also be integrated on the F-16 aircraft as a threshold platform.

The BLU-136/B, along with the BLU-134/B, make up the Next-Generation Area-Attack Weapon family of warheads that responds to a 2008 Defense Department policy which sought to minimize civilian harm by ending the use of cluster munitions that result in more than 1% unexploded ordnance by 2018. DOD characterized the directive as an alternative to a total ban proposal offered by the Oslo Process earlier that year.

That policy meant warfighters could no longer use the CBU-87 and CBU-103 cluster munitions, paving the way for the BLU-136/B.

According to the RFP, the acquisition is a 100% small business set-aside procurement.

By John Liang
July 31, 2019 at 3:25 PM

The full Senate has confirmed by unanimous voice vote President Trump's nomination of David Norquist to become deputy defense secretary.

Senate Armed Services Committee Chairman Jim Inhofe (R-OK) in a statement released today said Norquist "has demonstrated the managerial skills and strategic leadership needed as the Department of Defense's No. 2 civilian."

Nearly the entire Pentagon senior civilian leadership team in recent months had been serving in an acting capacity, creating complicated questions of succession.

Acting officials included the defense secretary, deputy defense secretary, chief management officer and comptroller. The Army currently has an acting secretary following Mark Esper's transition to defense secretary, while the Air Force is awaiting the nomination of Barbara Barrett.

Navy Secretary Richard Spencer is Senate-confirmed and was directed to serve as acting defense secretary while Esper underwent the nomination process.

Esper, who was confirmed last week, echoed previous statements by lawmakers and Pentagon officials that the unusually high number of senior leadership vacancies in the building is detrimental to the department.

In his statement today, Inhofe said the committee "will continue to consider additional Department of Defense nominees promptly, but with care, as the Senate receives nominations for these important civilian roles."

In related news, the committee held a hearing today to consider the nomination of Navy Vice Adm. Michael Gilday to become the next chief of naval operations, and yesterday Air Force Gen. John Hyten testified before the panel regarding his nomination to become vice chairman of the Joint Chiefs of Staff. The committee late this afternoon approved Hyten's nomination by a 20-7 vote.

By John Liang
July 31, 2019 at 2:00 PM

This Wednesday INSIDER Daily Digest has coverage of the Space Development Agency, a new "Hypersonics Roadmap," the Joint Direct Attack Munition and more.

A Pentagon spokeswoman told Inside Defense in a recent email that the lack of support for a future space architecture from lawmakers will delay early architecture studies and partnerships with industry to develop advanced capabilities:

Lawmakers' SDA reprogramming denial will delay early architecture studies

The Defense Department says the Space Development Agency's early efforts to study options for a future space architecture are now delayed after congressional lawmakers denied a $15 million reprogramming request to kick-start that work.

Document: SDA industry day slides, Q&A

A new Hypersonics Roadmap, spearheaded by the Office of the Secretary of Defense, seeks to efficiently coordinate Army, Navy, Air Force and Missile Defense Agency efforts to develop a new class of ultrafast offensive and defensive capabilities:

DOD drafting national S&T investment plan tied to new Hypersonics Roadmap

WEST LAFAYETTE, IN -- The Defense Department is drafting a national science and technology investment strategy to support a recently codified Hypersonics Roadmap.

Morocco, Jordan, the United Arab Emirates, Kuwait, Bahrain, Israel, Belgium, Finland, Slovakia, Taiwan and Japan will be getting Joint Direct Attack Munition tail kits:

JDAM contract extension includes FMS to Middle Eastern, European, Asian countries

An alteration to a multibillion-dollar contract for Joint Direct Attack Munition tail kits announced last month includes foreign military sales to Middle Eastern, European and Asian countries.

In case you missed it, Inside Defense recently obtained new, "for official use only" documents that outline $15 billion in budget cuts to various Army weapon systems by the service's "Night Court" process across the five-year budget plan:

Army 'Night Court' deep cuts revealed as Esper eyes expanding process Pentagon-wide

The Army's "Night Court" process cut $25 billion from legacy weapon systems to spend more on emerging technologies, with $15 billion coming from program eliminations and reductions detailed in documents obtained by Inside Defense.

Some cyber news from our colleagues at Inside Cybersecurity:

Ratcliffe, like Coats, brings cyber credentials to intelligence director post

Rep. John Ratcliffe's (R-TX) current claim to fame is a viral moment from last week's Mueller hearings, but the lawmaker selected to become the next director of national intelligence also would bring cybersecurity bona fides to the DNI role.

By Marjorie Censer
July 31, 2019 at 1:22 PM

Nazzic Keene, who formally takes over the reins of Science Applications International Corp. on Thursday, told Inside Defense today she is focused on continuing to integrate Engility, achieving growth and bolstering the company's position in hiring.

Keene said the integration of Engility has so far met the company's objectives, including its cost synergy goals. "We know that it's not done for many months," she said of the integration effort. "So that's certainly a priority of mine."

Stockholders for both SAIC and Engility approved the multibillion-dollar merger of the two companies in January.

Keene said today she is also seeking to capitalize on the acquisition to see growth.

"We've had modest growth the last couple years," she said, but noted the budget environment presents an opportunity to reach higher rates.

Additionally, Keene said she's spending time focusing on how the company can recruit new employees as well as retain existing ones.

Though she said SAIC continues to assess potential acquisitions, Keene said the contractor is not seeking a major purchase.

"I'd never say never, but doing a big one is not a priority of ours right now," she said.

By John Liang
July 31, 2019 at 11:14 AM

The House Appropriations Committee has denied a Pentagon request to shift $4.8 million to establish a cyber-specific workforce.

In a May 21 reprogramming request, then-acting Defense Department Comptroller Elaine McCusker had sought congressional permission to add $4.8 million "for the development and implementation of Cyber Excepted Service (CES) workforce programs and policies in order to ensure requirements are filled by an optimal mix of military service members, civilian employees and contract support."

The money would have provided for "the development of a new CES Strategy, [extended] current support personnel and [added] additional contract support personnel to increase the development of position classifications and training in order to assist Department of Defense Component efforts to expand the implementation of CES."

The $4.8 million was part of a larger $124.3 million cybersecurity request that included $117 million for the Navy's and Marine Corps' "Comply-to-Connect (C2C) Pathfinder," which lawmakers approved.

Any one of the four congressional defense committees can deny a reprogramming request. The comptroller's office this week released an updated version of the request that showed the congressionally approved and denied portions.

Lawmakers also approved the shifting of nearly $43.7 million to the Defense Information Systems Agency, $22.7 million of which would go to DISA's Information Systems Security Program, $1.75 million to the Net-Centric Enterprise Services (NCES) effort, $12.5 million to the Joint Tactical Information Distribution System (JTIDS) and $6.7 million to the National Security Agency's Information Systems Security Program.

Lawmakers also OK'd the shifting of $13 million to DISA for "administration and servicewide activities," including $12.5 million "for engineering support, architecture development and reporting of individual system compliance across non-classified and classified programs.

"This will enable an enterprise-level Automated Continuous Endpoint Management (ACEM) capability across the Department of Defense," the reprogramming request reads. "ACEM identifies each device on the network, thereby enabling the monitoring and management of those endpoint devices. Identification, monitoring and management of endpoint devices are critical steps to reducing cybersecurity risk to the network."

By Marjorie Censer
July 31, 2019 at 10:10 AM

The newly combined L3Harris Technologies is evaluating which of its businesses might not fit following the completion of its merger, according to the company's chief executive.

In a call with analysts this morning, Bill Brown called reviewing the new company's portfolio a "top priority for the management team."

"A broader mix of businesses gives us an opportunity to take a fresh look at the combined company portfolio," he said, noting executives are looking "at what fits and what doesn't fit."

Brown said L3Harris executives are evaluating businesses "using a couple of different lenses," including whether a unit's technology is differentiating and whether it delivers good returns.

He said company leadership is also talking about the issue with L3Harris' board of directors.

"It's really top of mind to us," Brown added.

Meanwhile, Harris said today sales in its most recent quarter -- which ended just before the merger closed -- hit $1.9 billion, up about 12% from the same three-month period a year earlier.

The company's quarterly profit reached $268 million, up 26% from the prior year.

By Marjorie Censer
July 31, 2019 at 10:02 AM

Mercury Systems said this week it has agreed to acquire American Panel, an Alpharetta, GA-based company that specializes in large area display technology, for $100 million.

According to Mercury, American Panel technology is deployed on the Army's Apache attack helicopter, the F-35 Joint Strike Fighter and the F-18, among others.

Meanwhile, Mercury also announced sales in its most recent quarter reached $177 million, up about 16% from the same three-month period a year earlier. The company said its sales growth was driven by about $18 million in sales from its newly acquired companies.

Mercury's quarterly profit hit $12.8 million, up about 27% from the prior year.

By Sara Sirota
July 30, 2019 at 3:42 PM

The State Department has approved a possible foreign military sale of an estimated $950 million in contractor logistics support for South Korea's fleet of RQ-4 Block 30 remotely piloted aircraft.

According to a news release by the Defense Security Cooperation Agency, South Korea requested program management, pilot and maintenance training, minor modifications and upgrades, operational flight support and other services. Northrop Grumman will be the principal contractor.

"This proposed sale will support the foreign policy and national security objectives of the United States by meeting the legitimate security and defense needs of one of the closest allies in the [Indo-Pacific Command] Theater," DSCA says in the notice.

It continues, "The potential sale will further strengthen the interoperability between the United States and the Republic of Korea and ensures the Alliance has a robust intelligence, surveillance, and reconnaissance (ISR) capability on the Korean peninsula."

By Jaspreet Gill
July 30, 2019 at 2:32 PM

Aberdeen Proving Ground anticipates hosting an advanced planning briefing to industry in late April next year. 

According to the announcement, posted on Federal Business Opportunities, the "goal of the APBI is to provide industry with information concerning potential future contracting opportunities for mission areas that focus on: Command, Control, Communications, Computers, Cyber, Intelligence, Surveillance, and Reconnaissance; Research and Development; Test and Evaluation; Chemical and Biological Defense; and APG Garrison mission."

During the APBI, the Army will brief industry on upcoming opportunities to better understand the service’s capability requirements. The notice states that the briefing will potentially identify contracting opportunities, specifically focusing on fiscal years 2021 and 2022 and will consist of breakout sessions. 

The APBI will be open to all small and large businesses, contractors, academic and other Army stakeholders. 

The tentative date for the briefing is set for the week of April 28 to 30 next year at Aberdeen Proving Ground, MD.

By Justin Katz
July 30, 2019 at 2:30 PM

The Government Accountability Office earlier this month dismissed a bid protest by General Dynamics Bath Iron Works concerning a shipyard services contract because the allegations were "filed prematurely," according to a GAO official.

Bath protested a contract worth up to $931 million for Littoral Combat Ship planning yard services that was awarded to Huntington Ingalls Industries. Bath was the incumbent in that competition.

"In this regard, [the Navy] indicated that it was investigating the protester's allegations. As a result, until the agency has finished its investigation and reached a conclusion about the results, we determined that the protest was premature and dismissed it," Kenneth Patton, managing associate general counsel for procurement law at GAO, said today in a statement to Inside Defense.

A Bath spokesman deferred comment to the Navy. A service spokesman declined to comment.

Austal USA in May filed a separate protest concerning the same contract with GAO and a decision for that bid protest is expected by August 28.

By John Liang
July 30, 2019 at 1:53 PM

This Tuesday INSIDER Daily Digest has news on the president's nominee to become the next director of national intelligence and more.

The president's nomination of Rep. John Ratcliffe (R-TX) to become the next director of national intelligence could receive a bumpy reception on Capitol Hill:

Ratcliffe, like Coats, brings cyber credentials to intelligence director post

Rep. John Ratcliffe's (R-TX) current claim to fame is a viral moment from last week's Mueller hearings, but the lawmaker selected to become the next director of national intelligence also would bring cybersecurity bona fides to the DNI role.

In case you missed it, Inside Defense recently obtained new, "for official use only" documents that outline $15 billion in budget cuts to various Army weapon systems by the service's "Night Court" process across the five-year budget plan:

Army 'Night Court' deep cuts revealed as Esper eyes expanding process Pentagon-wide

The Army's "Night Court" process cut $25 billion from legacy weapon systems to spend more on emerging technologies, with $15 billion coming from program eliminations and reductions detailed in documents obtained by Inside Defense.

Document: Army 'Night Court' budget cut tables

The Defense Department's inspector general conducted an audit into how military agencies have overseen contractor cybersecurity:

Audit finds DOD agencies failed to check adequacy of contractor cybersecurity

A new Defense Department inspector general audit has found DOD agencies routinely failed to check whether defense contractors were protecting sensitive information on their networks with the required security controls.

Document: DOD IG report on contractor cybersecurity

Could the DOD IG look into the multibillion-dollar JEDI cloud contract award? Republican lawmakers would really like that:

Potential IG investigation becomes latest sticking point in Pentagon's JEDI cloud saga

Republican lawmakers are imploring the Trump administration to delay the award of a massive enterprise cloud contract until the Defense Department inspector general investigates potential conflicts of interest, but DOD says it has already examined those allegations and found they did not affect the acquisition process.

Document: GOP lawmakers' letters to DOD on JEDI cloud contract

Inside Defense recently interviewed Raytheon Chief Financial Officer Toby O'Brien:

Raytheon and United Technologies hold 'joint kickoff' for integration work

Raytheon and United Technologies this week held a "joint kickoff" event for their integration process, according to a top Raytheon executive.

By Marjorie Censer
July 30, 2019 at 1:46 PM

Leidos said today it has named Jim Carlini chief technology officer, taking over from Jim Cantor, who has been promoted.

Cantor moves to the newly created position of chief of performance excellence and strategic partnerships. In a call with analysts this morning, Roger Krone, Leidos' chief executive, said Cantor will bolster the company's strategic supplier framework and ensure the company’s business framework principles are part of all program operations.

Carlini, who joined Leidos last year, previously founded a consultancy. He has also served as an executive at Northrop Grumman Electronic Systems and as director of the Defense Advanced Research Projects Agency's special projects office.

Meanwhile, Leidos said today sales in its defense solutions business during its most recent quarter hit $1.3 billion, up about 7% from the same three-month period a year earlier. The unit's quarterly profit hit $101 million, also up about 7% from the prior year.

By Marjorie Censer
July 30, 2019 at 1:09 PM

Crowell & Moring said today it has named Eric Ransom, a former lawyer in the Government Accountability Office's procurement law division, senior counsel in its government contracts group.

Ransom spent more than a decade at GAO, according to the law firm, and presided over multiple high-profile bid protests, including protests concerning the Air Force B-21 Stealth Bomber program.

More recently, Ransom was an attorney with the Senate Committee on Rules and Administration.