ATK says affordability focus paying off

By Andrea Shalal-Esa

PARIS (Reuters) - Alliant Techsystems Inc (ATK.N) on Monday said its focus on building lower-cost weapons that can be rapidly fielded is paying off with the U.S. military at a time when big-ticket programs with long development cycles are under mounting budget pressure.

ATK, which boosted revenues by 10 percent to $4.6 billion in the 2009 fiscal year ended March 31, is a smaller defense company whose stock surged to over $90 last week from $60 in late March.

It raised its fiscal 2010 sales guidance in May to a range of $4.73 billion to $4.80 billion, up from previous expectations of $4.55 billion to $4.65 billion.

"We continue to surprise ourselves," he said in an interview at the Paris Air Show.

ATK Chief Executive Dan Murphy told Reuters he was focused on using current technologies to add capabilities to current weapons and develop new ones that would get into the hands of soldiers in months, not years.

Murphy said has been telling investors since 2004 that U.S. defense spending would shift to extending the life and expanding the capabilities of existing weapons, contracts that ATK has aggressively pursued.

ATK's approach dovetails with that of Defense Secretary Robert Gates, who is pushing for a series of cuts to defense programs and wants the Pentagon to focus more on fighting today's wars than buying high-end weapons for some future fight.

ATK makes composite structures for military and commercial aircraft, including the Airbus A350, aircraft missile warning systems, commercial ammunition sales, precision weapons technology and solid rocket propulsion systems.