Rapiscan Systems Recieves Contract for Solid-State CT Systems for High-Speed Hold Baggage Screening
07 March 2006 - 11:00PM
Business Wire
OSI Systems, Inc. (NASDAQ: OSIS): -- Initial contract value of
approximately $7 million for multiple systems with $1.7 million
initial deposit -- Total contract value of approximately $40
million if all options for additional systems are exercised --
Revolutionary system would be up to four times faster than current
certified HBS CT systems Rapiscan Systems, a division of OSI
Systems, Inc. (NASDAQ: OSIS), announced today that it has received
a contract for approximately $7 million from Manchester Airport
Group ("MAG") for multiple units of the Rapiscan RTT120 CT system
for high-speed hold baggage screening ("HBS"). The contract award
included an initial deposit of approximately $1.7 million. Under
the terms of the contract Rapiscan Systems is to deliver the
systems starting in fiscal 2008 and the customer has an option for
additional systems through 2011. If fully exercised, the option
would bring the total value of the contract to approximately $40
million. The Rapiscan RTT120 has been designed to screen up to
1,500 bags per hour, or up to four times the speed of the currently
deployed certified CT systems in U.S. airports. The Rapiscan RTT120
utilizes a patented solid-state design that eliminates the need for
a rotating mechanical gantry. Customer Service Director of MAG, Mr.
Mike Razackerly, stated, "In 1996 Manchester was the first airport
in the world to deploy CT technology for Hold Baggage Screening.
Having more experience with this type of technology than other
airport management groups, we studied the benefits of the RTT120
closely and were convinced this technology represents a major step
forward in security detection systems in terms of both efficiency
and cost." President of Rapiscan Systems, Mr. Ajay Mehra, stated,
"We are extremely pleased with today's announcement and look
forward to working closely with Manchester Airports as they deploy
this state-of-the-art HBS technology in their network of airports.
The Rapiscan RTT120 underscores Rapiscan Systems' commitment to the
HBS market solidifying our global leadership position in the
aviation market." Chairman and CEO of OSI Systems, Mr. Deepak
Chopra, stated, "We applaud the management of Manchester Airports
for their foresight and commitment to the next generation of HBS
systems. The Rapiscan RTT120's patented technology would
revolutionize the HBS market, especially in terms of integration
and deployment cost. We have invested substantial R&D resources
in this program over the last few years. As a result of this order
we plan to accelerate our R&D investment in this program. This
technology could also have tremendous applications in the carry-on
baggage and medical imaging markets." Since 2002, approximately
1,200 certified HBS CT systems have been deployed in the U.S. These
CT systems, with an average hourly throughput of approximately 400
bags an hour, have effectively become a choke point in baggage
handling systems. As such, the current systems have resulted in
high integration costs, or sometimes an inability to integrate the
systems, resulting in placement on airport concourses. These
factors not only drive costs, but result in passenger congestion
and delays. Rapiscan's internal estimates indicate that
approximately 400 to 500 of the currently deployed certified
systems in the U.S. will be eligible for replacement in the next
three years with the remainder being replaced by 2011. Overall, the
potential global market for the Rapiscan RTT120 is estimated to be
several thousand systems over the next installation cycle. Rapiscan
Systems stated that, because the RTT120 is currently in
development, and subject to the inherent risks and uncertainties of
product development, there can be no assurance of the successful
completion of that development, timely or otherwise, or of the
characteristics of any final product, or whether such final product
will achieve certification by regulatory authorities. About
Rapiscan Systems Rapiscan Systems, a division of OSI Systems, Inc.,
is a leading supplier of high-quality security inspection solutions
utilizing X-ray and gamma-ray imaging, and advanced threat
identification techniques such as neutron and diffraction analysis.
The company's products are sold into four market segments: Baggage
and Parcel Inspection, Cargo and Vehicle Inspection, Hold Baggage
Screening, and People Screening. The company has an installed base
globally of more than 50,000 security and inspection systems. The
Rapiscan Systems product line is manufactured at four locations and
supported by a global support service network. For more information
on Rapiscan Systems, please visit www.rapiscansystems.com. About
OSI Systems, Inc. OSI Systems, Inc. is a Hawthorne,
California-based diversified global developer, manufacturer and
seller of security and inspection systems, medical monitoring and
anesthesia products, and optoelectronic devices and value-added
subsystems. The company has more than 30 years of experience in
electronics engineering and manufacturing and maintains offices and
production facilities located in more than a dozen countries. OSI
Systems implements a strategy of expansion by leveraging its
electronics and contract manufacturing capabilities into selective
end product markets through organic growth and acquisitions. For
more information on OSI Systems Inc. or any of its subsidiary
companies, visit www.osi-systems.com. This press release contains
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Such statements
include information regarding our expectations, goals or intentions
about the future, including, but not limited to, statements
regarding the Rapiscan RTT120 system, delivery of such system to
the Manchester Airport Group, the exercise of an option to purchase
additional systems by such group, the replacement and global market
for systems of this type, and most significantly, the fact that the
Rapiscan RTT120 is still under development. The actual results may
differ materially from those described in or implied by any
forward-looking statement. In particular, there can be no assurance
that the development of the Rapiscan RTT120 will be successful,
timely or otherwise, or whether such final product will achieve
certification by regulatory authorities. Other important factors
are set forth in our Securities and Exchange Commission filings.
All forward-looking statements speak only as of the date made, and
we undertake no obligation to update these forward-looking
statements.
OSI Systems (NASDAQ:OSIS)
Historical Stock Chart
From Aug 2024 to Sep 2024
OSI Systems (NASDAQ:OSIS)
Historical Stock Chart
From Sep 2023 to Sep 2024