The Microcap Speculator

Air Industries’ (OTCBB:AIRI) 2007 acquisition of Welding Metallurgy has largely been a disappointment.  Revenues never accelerated, and the large contracts many had hoped when the deal was announced never materialized…until now.

Today, Air Industries announced that Welding Metallurgy subsidiary won new contracts valued at over $2,000,000. These contracts, received in August 2008, compare to total revenues of less than $5,000,000 for all of 2007 (for the sub. as an independent company prior to August 2007 and as a subsidiary from its August 2007 acquisition through year end).  The company states that the contracts are incremental to the firm 18-month backlog of approximately $55 million, which it describes as “the highest level in its history.”

The largest order was from a defense contractor for “quick engine change lifts,” which require tube bending, specialty welding and machined parts.  According to Air Industries, Welding Metallurgy is “the only company that has successfully manufactured the product.”

More importantly to this investor, Welding Metallurgy President Gary Settoducato stated that the “future outlook for Welding Metallurgy looks similarly impressive as we are experiencing a high level of quote activity from customers that have only recently been introduced to our company and our capabilities. These inquiries include fixed-wing and helicopter programs in both the military and commercial arenas.”

UPDATE (9/12): Air Industries announced another sizable contract, this time in its Air Industries Machining (“AIM”) subsidiary.  The contract is valued at over $2.25M and is for replacement helicopter parts and assemblies.

DISCLOSURE: Long AIRI.OB.