Parsons Supports U.S. Indo-Pacific Defense With $68.5 Million U.S. Army Infrastructure Contract

Rhea-AI Summary

Parsons (NYSE: PSN) has secured a $68.5 million contract from the U.S. Army Corps of Engineers Honolulu District to design and build new Army housing units in the Kwajalein Atoll, Republic of the Marshall Islands. This three-year contract represents new business for Parsons. Additionally, the company has been selected for the district's Pre-Qualified Source Listing, making it eligible for future large task orders valued at $50 million or more.

This award expands Parsons' work in the Kwajalein Atoll, known for its logistical challenges and corrosive environment. It follows a $44 million contract awarded in October 2023 for similar housing projects. Since 2019, Parsons has secured over $400 million in INDOPACOM-related contracts, leveraging its expertise in program management, engineering, and complex infrastructure.

Positive

• Secured a new $68.5 million contract for U.S. Army housing units in Kwajalein Atoll
• Selected for Pre-Qualified Source Listing, enabling eligibility for future large task orders
• Expanded presence in the strategically important Indo-Pacific region
• Demonstrated continued trust from U.S. Army Corps of Engineers
• Accumulated over $400 million in INDOPACOM-related contracts since 2019

Negative

• None.

Insights

Financial Analyst

The $68.5 million contract awarded to Parsons (NYSE: PSN) by the U.S. Army Corps of Engineers is a significant win, expanding their footprint in the Indo-Pacific region. This new work, coupled with their selection for the Pre-Qualified Source Listing (PQSL), positions Parsons favorably for future large task orders. The company's track record of securing over $400 million in INDOPACOM-related contracts since 2019 demonstrates a strong growth trajectory in this strategic area.

While the three-year timeframe of the contract provides near-term revenue visibility, investors should note the potential for long-term value creation through the PQSL eligibility. The challenging environment of Kwajalein Atoll may lead to higher margins due to the specialized expertise required. However, these same factors could also pose execution risks that warrant monitoring.

Defense Industry Analyst

This contract underscores the strategic importance of the Indo-Pacific region in U.S. defense planning. The investment in infrastructure in remote locations like Kwajalein Atoll signals a long-term commitment to maintaining a robust military presence in the area. Parsons' growing portfolio of INDOPACOM-related projects, now exceeding $400 million, reflects the broader trend of increased defense spending in the region.

The company's ability to secure consecutive housing contracts in this challenging environment demonstrates a competitive advantage in complex infrastructure projects. This expertise could become increasingly valuable as geopolitical tensions in the Indo-Pacific region continue to shape defense priorities and spending patterns.

Construction Management Expert

The Kwajalein Atoll project presents unique logistical and environmental challenges that require specialized expertise. The highly corrosive and humid environment demands advanced construction techniques and materials, likely increasing project costs but also potentially leading to innovative solutions. Parsons' previous experience in the region is a significant advantage, potentially allowing for more efficient project execution and risk management.

The company's ability to deliver in such complex environments could set a new standard for military infrastructure projects in remote locations. This expertise may open doors to similar high-value contracts in other challenging environments globally. However, the remote location and harsh conditions also pose risks of project delays and cost overruns that investors should be aware of.

CHANTILLY, Va., Sept. 09, 2024 (GLOBE NEWSWIRE) -- Parsons Corporation (NYSE: PSN) announced today that the company was awarded a contract by the United States Army Corps of Engineers (USACE) Honolulu District to provide the design-bid-build delivery of new U.S. Army housing units in the Kwajalein Atoll in the Republic of the Marshall Islands. The three-year, $68.5 million single-award contract is new work for the company.

Parsons was also selected by the USACE Honolulu District as a successful offeror on the district’s Pre-Qualified Source Listing (PQSL), making the company eligible to receive future large task orders valued at $50 million or more in the district’s area of responsibility.

“Parsons is a trusted delivery partner to the U.S. Army Corps of Engineers in advancing infrastructure projects that advance U.S. Indo-Pacific Command,” said Jon Moretta, President, Engineered Systems for Parsons. “This award expands our work in the Kwajalein Atoll, a uniquely complex environment for infrastructure due to the logistical challenges of servicing the remote location as well as the highly corrosive and humid environment. We look forward to furthering the Corps of Engineers Honolulu District’s efforts to contribute to stability and security of the Indo-Pacific region.”

Under this contract, Parsons will deliver new army housing units on-island, the second such contract the company received in under a year. In October 2023, the company announced it was awarded a $44 million contract to deliver army housing units in support of the Department of the Army’s modernization initiatives. Since 2019, Parsons has been awarded more than $400 million in INDOPACOM-related contracts by leveraging their program and construction management; engineering and planning; and complex infrastructure expertise. The company continues to partner with customers across the INDOPAC region to deliver integrated solutions across the national security and critical infrastructure portfolios.

To learn more about Parsons’ global infrastructure solutions, visit Parsons.com/federal-infrastructure/.

About Parsons:
Parsons (NYSE: PSN) is a leading disruptive technology provider in the national security and global infrastructure markets, with capabilities across cyber and intelligence, space and missile defense, transportation, environmental remediation, urban development, and critical infrastructure. Please visit parsons.com and follow us on LinkedIn and Facebook to learn how we're making an impact.

Forward-Looking Statements:
This document contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are based on our current expectations, beliefs and assumptions, and are not guarantees of future performance. Forward-looking statements are inherently subject to uncertainties, risks, changes in circumstances, trends and factors that are difficult to predict, many of which are outside of our control. Accordingly, actual performance, results and events may vary materially from those indicated in the forward-looking statements, and you should not rely on the forward-looking statements as predictions of future performance, results or events. Numerous factors could cause actual future performance, results and events to differ materially from those indicated in the forward-looking statements, including, among others: any issue that compromises our relationships with the U.S. federal government or its agencies or other state, local or foreign governments or agencies; any issues that damage our professional reputation; changes in governmental priorities that shift expenditures away from agencies or programs that we support; our dependence on long-term government contracts, which are subject to the government’s budgetary approval process; the size of our addressable markets and the amount of government spending on private contractors; failure by us or our employees to obtain and maintain necessary security clearances or certifications; failure to comply with numerous laws and regulations; changes in government procurement, contract or other practices or the adoption by governments of new laws, rules, regulations and programs in a manner adverse to us; the termination or nonrenewal of our government contracts, particularly our contracts with the U.S. federal government; our ability to compete effectively in the competitive bidding process and delays, contract terminations or cancellations caused by competitors’ protests of major contract awards received by us; our ability to generate revenue under certain of our contracts; any inability to attract, train or retain employees with the requisite skills, experience and security clearances; the loss of members of senior management or failure to develop new leaders; misconduct or other improper activities from our employees or subcontractors; our ability to realize the full value of our backlog and the timing of our receipt of revenue under contracts included in backlog; changes in the mix of our contracts and our ability to accurately estimate or otherwise recover expenses, time and resources for our contracts; changes in estimates used in recognizing revenue; internal system or service failures and security breaches; and inherent uncertainties and potential adverse developments in legal proceedings, including litigation, audits, reviews and investigations, which may result in materially adverse judgments, settlements or other unfavorable outcomes. These factors are not exhaustive and additional factors could adversely affect our business and financial performance. For a discussion of additional factors that could materially adversely affect our business and financial performance, see the factors included under the caption “Risk Factors” in our Registration Statement on Form S-1 and our other filings with the Securities and Exchange Commission. All forward-looking statements are based on currently available information and speak only as of the date on which they are made. We assume no obligation to update any forward-looking statement made in this presentation that becomes untrue because of subsequent events, new information or otherwise, except to the extent we are required to do so in connection with our ongoing requirements under federal securities laws.

Media Contact:
Jonathan Larry
+1 706.832.7330
jonathan.larry@parsons.com

Investor Relations Contact:
Dave Spille
+1 703.775.6191
Dave.Spille@parsons.us

FAQ

What is the value of Parsons' new contract for U.S. Army housing in Kwajalein Atoll?

Parsons (NYSE: PSN) was awarded a $68.5 million contract by the U.S. Army Corps of Engineers Honolulu District for new Army housing units in the Kwajalein Atoll, Republic of the Marshall Islands.

How long is the duration of Parsons' new contract for Kwajalein Atoll housing?

The contract for new U.S. Army housing units in the Kwajalein Atoll is a three-year, single-award contract.

What is the significance of Parsons being selected for the USACE Honolulu District's Pre-Qualified Source Listing?

Being selected for the Pre-Qualified Source Listing makes Parsons (NYSE: PSN) eligible to receive future large task orders valued at $50 million or more in the district's area of responsibility.

How much has Parsons (PSN) been awarded in INDOPACOM-related contracts since 2019?

Since 2019, Parsons has been awarded more than $400 million in INDOPACOM-related contracts, leveraging their expertise in program management, engineering, and complex infrastructure.