Washington Post 200: Argon ST Inc.

Industry: Aerospace/defense

Post 200 Category: Top 125 Companies

Revenue: $129.18 Million

Net Income/Loss: $9.95 Million

Earnings per share: $0.74

Dividend: $0.59

Stockholder equity: $160.93 Million

Auditor: Grant Thornton LLP

Stock: STST

Assets: $221.74 Million

Market capitalization: $569.48 Million

52-week high: 38.39 2/8/2005

52-week low: 16.3 4/15/2004

Chairman and CEO: Terry Collins

Vice chairman and VP: S. Kent Rockwell

Employees: 601

Local employees: 418

Description: Argon ST is a contractor primarily for defense, homeland security and intelligence agencies. It builds communications and surveillance systems, including anti-torpedo defense devices for Navy ships.

Developments: Argon ST was born in 2004 after an all-stock merger of Fairfax-based Argon Engineering Associates Inc. and Newington-based Sensytech Inc. The idea behind the union was to give the government another one-stop-shopping option for command, control, communications, computers, intelligence, surveillance and reconnaissance work. Sensytech, a public company, had specialized in communications hardware and surveillance systems used by the military to intercept radio messages and radar signals. Argon, which had been privately owned, came up with software that identified and processed signals. Under the merger agreement, announced in June and completed in September, Argon shareholders became the dominant force in the combined company, owning about two-thirds of its shares. Argon had grown faster than Sensytech over the preceding five years, and its 2004 revenue was twice as great. At the time of the deal, the combined companies had more than $250 million in funded contracts. The deal with Argon Engineering was not the only one that Sensytech pulled off last year. In April, the company bought Winter Park, Fla.-based Imaging Sensors and Systems Inc. ISS had specialized in infrared radar systems, giving Sensytech a new tool in its surveillance technology division. Sensytech's earnings lagged in the first half of the year because of high costs associated with its decision to shift production from a facility in New Jersey to one in Pennsylvania, but profit picked up considerably in the third quarter, the company's last before the merger. Argon ST's first quarter of reporting showed similarly robust results. That performance, combined with Wall Street approval of the merger, sent Argon stock soaring in 2004, up 170 percent on the year.

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