Frequency Electronics, Inc. (FEI) is a world leader in the design, development, and manufacture of high-precision timing, frequency control and synchronization products for satellite and terrestrial applications.
The Company's products are used in commercial, government and military systems, including satellite payloads, missiles, UAVs, piloted aircraft, GPS, secure radios, SCADA, energy exploration and wireline and wireless communication networks. FEI has received over 60 awards of excellence for achievements in providing high performance electronic assemblies in over 120 space programs.
The Company reports under three business segments primarily based on geographic location: (1) FEI-NY (2) Gillam-FEI and (3) FEI-Zyfer.
- FEI-NY (67% of fiscal 2006 sales) consists principally of time and frequency control products used in commercial communication and US Government satellite systems; terrestrial cellular telephone or other ground-based telecommunication stations markets; and other products used for national defense. The Company's China production facility, FEI-Asia, is included in this segment.
- Gillam−FEI (16% of fiscal 2006 sales) was acquired in September 2000. It primarily designs and manufactures wireline synchronization and network management systems.
- FEI-Zyfer (19% of fiscal 2006 sales) was acquired in May 2003. It designs and manufactures GPS-aided precision time and frequency generation and synchronization products for commercial and government users.
In September 2004, FEI increased its ownership of OAO Morion, a Russian manufacturer, to 36%. Morion is a source of high-quality, cost-effective quartz oscillators and components for many of FEI's assemblies.
The total high precision time and frequency market is expected to grow substantially over the next 5 years. In that timeframe, FEI's addressable market is projected to increase from today's under $400 million to over $1 billion per year. FEI's goal is to capture a larger share of growing markets.
The Company's mission is to utilize its proprietary technologies to provide the most advanced products for control of frequency and time. Precise time and frequency are essential factors for synchronizing communication networks and for providing reference frequencies for certain terrestrial and space applications in military, commercial and scientific programs.
The Company's recent initiatives are aimed at new, large market opportunities by broadening the Company's product offerings.
FEI also continues to review opportunities to grow the Company by merger, acquisition, and strategic partnership.
Following are the key growth drivers for the high precision time and frequency industry and FEI's technologies and products.
- Increased synchronization requirements for wireless networks as services are expanded to maximize spectrum utilization.
- Replacement and upgrade of wireline synchronization systems in the US and throughout the world.
- Replacement of existing commercial satellites.
- Upgrade of US Government satellite systems to increase available bandwidth.
- Trend of US satellite integrators to outsource more of the payload.
- Secure radios for military applications.
- Improved guidance & navigation systems for advanced weapons systems and Unmanned Aerial Vehicles (UAVs).
- Significantly improve seismic mapping in deep-hole drilling for oil & gas exploration.
To address these growth areas, FEI has introduced a number of new products aimed at increasing its share of the high precision time and frequency market. These product initiatives are expected to generate substantial revenue in fiscal year 2007 and form the basis for continued revenue growth in future years.
- State-of-the-art master clocks, frequency generators and synthesizers, frequency converters and receivers for government and commercial satellite payloads.
- Unparalleled high performance and cost-effective Quartz oscillators for wireless network cell sites.
- A major proprietary breakthrough in a low gravitational-sensitivity ("low g") clock with large military applications as well as certain commercial programs.
- A new, cost-effective Universal Synchronization system ("US5G") for wireline networks with advanced remote network monitoring and management.
- An extremely high temperature, precision OCXO clock with first application for deep earth drilling.