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Ceradyne, Inc. recently announced that it is aware of a protest filed with the Government Accounting Office by a bidder on the anticipated multi-year XSAPI/ESAPI contract. The referenced award will be delayed unless the Army overrides the protest on urgent and compelling grounds. If the protest is not overridden, the award would most likely be delayed, resulting in lower shipments and earnings in Q4 2008 for Ceradyne. Ceradyne understands that various government officials and interested politicians believe the award should not be further delayed because of the protest.
On July 25, 2008, the company’s guidance for 2008 included a sales range from $740 million to $750 million and earnings from $4.70 to $4.80 per diluted share. Based on the above information, the company is providing revised 2008 guidance to a sales range from $710 million to $750 million and earnings from $4.25 to $4.80 per diluted share.
The lower end of the sales and earnings range assumes that an XSAPI award would be made to Ceradyne in late 2008 with only one month of XSAPI shipments in the fourth quarter. The earnings range does not include the effect of the estimated $10 million pre-tax charge in third the quarter of 2008 related to the SemEquip acquisition.
Additional information is available at www.ceradyne.com.