- The Washington Times - Monday, September 26, 2005

Analex Corp., a contractor with the Department of Homeland Security, is bringing on new senior staff as it positions itself for more acquisitions.

The Alexandria company posted a 72 percent increase in revenue in the last quarter from its business of providing mission-critical services to the federal government, such as intelligence analysis and deciding when to launch rockets.

Its major customers include NASA, the National Security Agency, the U.S. Navy and the Missile Defense Agency.

Analex’s revenue for the second quarter was $38.1 million, compared with $22.2 million for the same period last year.

Nevertheless, the company endured a net loss largely because of $3.1 million in cash and non-cash charges associated with acquisitions.

The net loss for the second quarter was $1.9 million, or 12 cents per diluted share, compared with a net loss of $1.8 million, or 13 cents per diluted share, for the same period last year.

The company’s stock has remained flat for much of this year. It closed yesterday at $3.10 per share, up 6 cents, or 2 percent, on the American Exchange, where it trades under the symbol NLX.

In the past year, its stock value has ranged from $2.85 per share to $5 per share.

Both its new chief financial officer and new vice president of business development come from billion-dollar companies, where they made their reputations in part by arranging acquisitions and developing new business lines.

C. Wayne Grubbs, the new chief financial officer, previously worked for defense contractor SRA International Inc., where he was the corporate controller as the company expanded from an annual revenue of $200 million to nearly $1 billion in seven years.

Also starting a new job with Analex this month is Steve Matthews, vice president for business development, who learned his craft with major defense contractors such as Lockheed Martin Corp. and Computer Data Systems Inc.

They are supposed to help the company grow in a highly specialized business often limited by a lack of job candidates with both engineering expertise and government clearances.

“For companies like these, the gating factor is finding qualified personnel,” said Jim McIlree, managing director of CE Unterberg Towbin LLC, a New York investment bank. “Finding qualified people who have the appropriate clearances is a difficult chore.”

Analex, founded in 1964, operates with 1,100 employees stationed at government sites such as Kennedy Space Center in Florida and Vandenberg Air Force Base in California.

Earlier this year, Analex completed its acquisition of ComGlobal Systems Inc., which added 200 employees and expanded its customer base. Last year, Analex acquired Beta Analytics International, an Upper Marlboro defense contractor.

The company plans to use funding from investors such as Pequot Ventures, GE Pension Trust and New York Capital Life Partners to help finance additional mergers and acquisitions.

“We believe we can grow organically at a 10 percent to 15 percent annual rate and complement that with acquisitions of companies in our space,” said Sterling E. Phillips Jr., Analex’s chief executive officer.

The organic growth would include services such as providing quality assurance for unmanned rocket hardware and software. Much of Analex’s other work is known only to a few people.

About 67 percent of the company’s revenue came from its Homeland Security Group, according to Analex’s quarterly Securities and Exchange Commission filing. The rest came from its Systems Engineering Group.


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