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Black Box headquarters in Bridgeville.
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Black Box receives $10.4 million grant to enhance IT for Ukraine's defense ministry

Michael Henninger/Post-Gazette

Black Box receives $10.4 million grant to enhance IT for Ukraine's defense ministry

Ailing technology company Black Box announced Thursday that it has been awarded a $10.4 million contract from the U.S. Army, a sliver of hope for a firm that has reported staggering losses in the last four quarters.

Black Box will assist the Ukraine Ministry of Defense — which was established in 1991 after Ukraine declared independence from the Soviet Union to prevent hostility and support the military — in expanding the group’s existing information technology platform. The U.S. Army is funding and administering the contract.

Over the next year, the Washington County-based communication and information technology equipment company will provide hardware and software services to further augment the Ministry’s command, control, communications, computers, intelligence surveillance and reconnaissance capabilities, set for use at military bases throughout Ukraine.

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The contract is an extension of a previous relationship with the U.S. Army to support Ukraine in combat zones and at home, established in September 2016.

In this 2016 photo, the headquarters of Black Box.
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Black Box was selected by the U.S. Army to design and deploy enhanced cybersecurity operations, a command and control center, a medical information system and a logistical information system for Ukraine in September 2016. 

“We are very pleased that the U.S. Army has selected us for this effort and honored to be a part of [the program] and its continuing development,” Jeff Murray, vice president for government solutions at Black Box, said in a release. “This project will add resiliency to capabilities already being designed and built by Black Box and expand the capability more broadly within Ukraine.”

Despite the size of the contract, it looms in the presence of the company’s continuing financial slide. 

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In mid-November, former CEO E.C. Sykes retired amid the firm’s continuing financial strain. Earlier that month, Black Box posted enduring net losses of $11.4 million in the second quarter of the 2018 fiscal year compared to a $6.1 million loss for the same period a year ago.

The company said Joel T. Trammell, who has been a board member since March 2013, would immediately replace Mr. Sykes as CEO. In a release, Black Box noted that Mr. Sykes helped the firm “through difficult aspects of the company’s transformation,” during his tenure.

Exactly one year ago, Black Box shares were trading at $16.30 each at market close. When trading ended Thursday, shares went for $3 flat.

Courtney Linder: clinder@post-gazette.com or 412-263-1707. Twitter: @LinderPG.

First Published: December 8, 2017, 3:27 p.m.

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Black Box headquarters in Bridgeville.  (Michael Henninger/Post-Gazette)
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