Costa Mesa’s Ceradyne Inc. on Wednesday upped its profit forecast for 2011, citing better sales expectations and improved profits as business picks up.
Ceradyne, one of the largest makers of bulletproof vests and other armor during the height of fighting in Iraq and Afghanistan, expects to see an adjusted profit of $66.9 million in 2011.
Analysts on average had been expecting an adjusted profit of $45.3 million.
Revenue is expected to come in at $560 million, above Wall Street projections of $522.5 million.
That’s up from an earlier forecast of an adjusted profit of $58.2 million on $505 million in revenue.
The rosy outlook sent Ceradyne shares up more than 18% Wednesday to a market value of $1.1 billion.
Ceradyne Chief Executive Joel Moskowitz said the company is seeing increasing gross margins, an improved sales mix and a recovery in its armor business, a key segment that took a hit in 2010 as heavy fighting in Iraq and Afghanistan subsided.
The company last week announced a $56.6 million order for body armor plates from the federal government.
Moskowitz also projected increased industrial ceramic business in Europe and strong demand for its fused silica ceramic solar crucible business. The ceramic crucibles are used to hold melted silicon.
Ceradyne has been working on a long-running diversification after seeing a boom in sales of its military armor during the height of fighting in Iraq and Afghanistan.
At its peak in 2007, Ceradyne shipped $535 million worth of body armor to soldiers in the field as defense contracts accounted for 74% of its business.
Sales to the defense sector in the fourth quarter accounted for 19% of sales.
