Quickstep Poised to Supply F-35 JSF Components

08 February 2011

Australian advanced materials company Quickstep has signed a Long Term Agreement (LTA) to manufacture parts for the international F-35 Joint Strike Fighter (JSF) program over the next 20 years.

Under the framework established in the LTA, first JSF parts and first cash flow will be delivered in 2012. The LTA is the first of several agreements which will implement the Memorandum of Understanding (MOU) that was signed in November 2009 Lockheed Martin and Northrop Grumman.

Under the MOU, Quickstep will supply up to 16 different JSF components, including lower side skins, maintenance access panels, fuel tank covers, lower skins and in-board weapons bay doors, projected to amount to some 36,000+ parts over the life of the program and could generate annual turnover of around $50 million by 2015. The total value of the work over the life of the aircraft could be up to $700M.

With this large-scale manufacturing agreement now in place, Quickstep also today announced plans to establish a major new aerospace manufacturing facility at Bankstown Airport in south-west Sydney, signing a 10-year lease over 4,200sqm of buildings that were previously used by US aerospace giant Boeing, in a move that will secure the Company's long-term aerospace manufacturing capabilities.

Quickstep Chief Executive, Mr Philippe Odouard, said it was an historic day for the Company, marking the culmination of many years of hard work in promoting Quickstep's aerospace manufacturing capabilities and demonstrating its ability to meet the high standards required under the JSF program requirements.

""The signing of this LTA signals a genuine quantum shift in Quickstep's development. The international defence industry has perhaps one of the highest barriers to entry of any industry in the world, but, for companies that are successful, the contracts are generally large scale and long term. Quickstep has now earned its place as a supplier for JSF, and we hope many additional aerospace and defence contracts will soon follow,"" Mr Odouard commented.

""In addition, our success in securing specific sections of Boeing's former manufacturing site in Sydney will provide Quickstep with a long-term lease over a manufacturing facility that offers the scale, resources and utilities necessary to undertake large-scale aerospace and defence manufacturing.""

""The facility at Bankstown Airport was previously a substantial aerospace manufacturing facility with a workforce with aerospace industry skill-sets in place. This represents an absolutely outstanding opportunity for Quickstep to lock-in the manufacturing capacity required for the delivery of first JSF parts in 2012 and support further contracts as they are secured.""

Dr Ram Ramkumar, Director of F-35 International Programs at Northrop Grumman's Aerospace Systems sector, said: ""This LTA gets us a step closer to meeting our F-35 industrial participation commitment to the government of Australia. We look forward to Quickstep's involvement in the JSF program, and their production of F-35 composites subassemblies that will be delivered to our assembly operations in Palmdale, California.""

The move to Bankstown is expected to provide Quickstep with the manufacturing capacity to become the largest independent aerospace composites manufacturer in Australia, with the Company actively seeking further manufacturing contracts.

The decision to establish a new manufacturing hub in NSW was underpinned by strong support from the NSW Government and the ability to access an existing workforce with the specialist skill sets required to deliver such a large scale defence program, together with access to the large network of suppliers located in NSW and on the east coast of Australia.

""The NSW Government has provided invaluable assistance to facilitate this move and we are extremely pleased to be working with them to ensure that State's proud reputation for aerospace manufacturing continues long into the future,"" Mr Odouard said.

Quickstep's move to Bankstown will include the transfer of R&D programs relating to the Company's proprietary composites manufacturing technology the Quickstep Process - which will form a key component of Quickstep's future licensing and export capabilities from Australia.

New South Wales Treasurer and Minister for State & Regional Development, the Hon. Eric Roozendaal MLC said the State was actively working to attract new manufacturing ventures.

""The New South Wales Government recognises the importance of manufacturing to the State economy particularly large-scale export-based manufacturing such as that seen in the international aerospace and defence industries, and we are delighted to welcome Quickstep as one of the new wave of Australian manufacturing companies that have the potential to significantly contribute to the State's long-term growth. We are particularly interested in Quickstep's R&D capabilities which will continue to build the intellectual property of Australian companies and their export capacity.""

The Minister for Defence Materiel the Hon. Jason Clare said, ""The F-35 Joint Strike Fighter forms a key element of Australia's future defence program, and the Government is actively working to ensure Australian businesses have an opportunity to tender for JSF contracts. Today's signing of a Long Term Agreement between Quickstep and Northrop Grumman demonstrates how Australian businesses can participate in this major international development initiative.""

Quickstep intends to undertake a staged transition from its existing facility in Western Australia, with all Western Australian employees to be offered the opportunity to relocate to Sydney. The Company plans to move some initial staff members to Bankstown in early 2011 and plans to be ready for aerospace manufacturing by the end of 2011.

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