Digital Fusion is soaring

Tuesday, December 11, 2007

By GINA HANNAH

Times Business Writer gina.hannah@htimes.com

Defense, aerospace firm finds success with move to Huntsville

Digital Fusion began as a dot-com and underwent the challenges that many high-tech companies faced when that sector crashed several years ago.

Today, the Huntsville-based company has about 300 employees and expects more than $45 million in revenue this year.

The company moved its headquarters from Florida to Huntsville in 2003 to refocus its goals on the defense and aerospace industries. That strategy has served the firm well.

"Huntsville was the only profitable office," said Chris Brunhoeber, Digital Fusion's chief financial officer.

Since the move, Digital Fusion's core work has expanded to offer engineering and design services, testing and evaluation, modeling and simulation, consulting and acquisition and business support.

The firm acquired Huntsville-based Summit Research Corp. in January 2005, gaining a $3.2 million contract with the U.S. Army Space and Missile Defense Command in the process. Later that year, the company garnered a National Aeronautics and Space Administration acquisition and business support contract with the potential to bring some $48 million in work to the company over five years.

The NASA contract also helped the company gain recognition as it worked to expand from serving just the U.S. Army to other military divisions as well as Homeland Security.

"The NASA contract was good news," said Frank Libutti, Digital Fusion's chairman and CEO. "It helped morale and showed (employees) they'd achieved past performance and excellent levels with that."

Libutti joined Digital Fusion's board of directors in spring 2005 and became chairman and CEO that fall. He retired as a lieutenant general after a 35-year career in the Marines, and was the New York City Police Department's first deputy commissioner of counter-terrorism, serving after the Sept. 11, 2001, terrorist attacks. He was also the first undersecretary for the Information Analysis and Infrastructure Protection Directorate at the newly created U.S. Department of Homeland Security.

Brunhoeber joined Digital Fusion from Adtran Inc. with a background in Securities Exchange Commission reporting.

Overall growth

For the fiscal quarter ended Sept. 21, Digital Fusion reported net income of $169,000 on $12.1 million in revenue. Just three years ago, the company had about $7 million in revenue and 50 employees; today the number of employees has increased to 300. In addition to its headquarters on Bradford Drive, the firm also has offices in Washington, D.C., and El Paso, Texas, as well as a missile prototype lab on Wynn Drive.

Share price averaged about $25 in the 1990s, and plunged to 50 cents at one point, Brunhoeber said. These days, shares average around $2 per share, traded on the over-the-counter "pink sheets." Many of the company's investors are institutional groups and board members, and employees have the option of obtaining stock, he said.

"We've tried to develop a culture of honesty, integrity and loyalty and creating alliances," Libutti said. He also works to create open communication with employees and let employees make the decisions they need to do their jobs and avoid building a large bureaucracy.

"Taking care of the troops is something you learn very early in the military," he said.

Brunhoeber agreed.

"In a service company, people are our assets," he said.



Digital Fusion is soaring Tuesday, December 11, 2007 By GINA HANNAH Times Business Writer gina.hannah@htimes.com Defense, aerospace firm finds success with move to Huntsville Digital Fusion began as a dot-com and underwent the challenges that many high-tech companies faced when that sector crashed several years ago. Today, the Huntsville-based company has about 300 employees and expects more than $45 million in revenue this year. The company moved its headquarters from Florida to Huntsville in 2003 to refocus its goals on the defense and aerospace industries. That strategy has served the firm well. "Huntsville was the only profitable office," said Chris Brunhoeber, Digital Fusion's chief financial officer. Since the move, Digital Fusion's core work has expanded to offer engineering and design services, testing and evaluation, modeling and simulation, consulting and acquisition and business support. The firm acquired Huntsville-based Summit Research Corp. in January 2005, gaining a $3.2 million contract with the U.S. Army Space and Missile Defense Command in the process. Later that year, the company garnered a National Aeronautics and Space Administration acquisition and business support contract with the potential to bring some $48 million in work to the company over five years. The NASA contract also helped the company gain recognition as it worked to expand from serving just the U.S. Army to other military divisions as well as Homeland Security. "The NASA contract was good news," said Frank Libutti, Digital Fusion's chairman and CEO. "It helped morale and showed (employees) they'd achieved past performance and excellent levels with that." Libutti joined Digital Fusion's board of directors in spring 2005 and became chairman and CEO that fall. He retired as a lieutenant general after a 35-year career in the Marines, and was the New York City Police Department's first deputy commissioner of counter-terrorism, serving after the Sept. 11, 2001, terrorist attacks. He was also the first undersecretary for the Information Analysis and Infrastructure Protection Directorate at the newly created U.S. Department of Homeland Security. Brunhoeber joined Digital Fusion from Adtran Inc. with a background in Securities Exchange Commission reporting. Overall growth For the fiscal quarter ended Sept. 21, Digital Fusion reported net income of $169,000 on $12.1 million in revenue. Just three years ago, the company had about $7 million in revenue and 50 employees; today the number of employees has increased to 300. In addition to its headquarters on Bradford Drive, the firm also has offices in Washington, D.C., and El Paso, Texas, as well as a missile prototype lab on Wynn Drive. Share price averaged about $25 in the 1990s, and plunged to 50 cents at one point, Brunhoeber said. These days, shares average around $2 per share, traded on the over-the-counter "pink sheets." Many of the company's investors are institutional groups and board members, and employees have the option of obtaining stock, he said. "We've tried to develop a culture of honesty, integrity and loyalty and creating alliances," Libutti said. He also works to create open communication with employees and let employees make the decisions they need to do their jobs and avoid building a large bureaucracy. "Taking care of the troops is something you learn very early in the military," he said. Brunhoeber agreed. "In a service company, people are our assets," he said. © 2007 The Huntsville Times © 2007 al.com All Rights Reserved.