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News

Teledyne Technologies Reports First Quarter Earnings

LOS ANGELES - April 27, 2000 - Teledyne Technologies Incorporated (NYSE: TDY) today reported first quarter 2000 sales of $203.5 million, compared with sales of $202.0 million for the same period in 1999. Net income was $10.2 million ($0.38 per diluted share) for the first quarter, compared with pro forma net income of $9.7 million ($0.35 per diluted share) for the first quarter of 1999.

Teledyne Technologies was spun off from Allegheny Teledyne Incorporated effective November 29, 1999. Pro forma adjustments in 1999 reflect the estimated expense impacts (primarily interest expense and corporate expenses) that would have been incurred had Teledyne Technologies operated as a separate company and as capitalized at the time of the spin-off for the 1999 period presented. Net income, before pro forma adjustments, was $11.9 million ($0.43 per diluted share) for the first quarter of 1999.

"As we complete our first full quarter as a public company, I am pleased to report that we met our earnings expectations for the quarter,'' said Robert Mehrabian, president and chief executive officer.

"We are pleased with our success in key commercial markets as well as our position in several important defense programs. Compared to last year, we experienced significant growth in airborne communication products, microwave power amplifiers, high frequency relays, electronic manufacturing services and piston engines for general aviation. In addition to growing our systems engineering, information technology and environmental businesses, we received a substantial production phase order from Lockheed Martin Corporation for cruise missile turbine engines. We are focusing more attention on leveraging our manufacturing skills to pursue opportunities in high growth markets such as wireless communications and fiber optics packaging."

Review of Operations

Electronics and Communications

The Electronics and Communications segment first quarter sales were $85.7 million, up 3.0 percent from 1999 first quarter sales of $83.2 million. First quarter operating profit rose 11.8 percent to $9.5 million, from $8.5 million in the first quarter of 1999.

First quarter sales, compared with the same period in 1999, grew significantly in electronic manufacturing services, relay products, business and commuter aircraft communications equipment and microwave products. Sales from electronic manufacturing services and microwave products grew as a result of new orders from both military and commercial customers. Relay products reported its strongest quarterly sales in over two years based on demand from the communications and semiconductor test equipment markets. Sales of medical and military microelectronics were down from the same period last year. Increased profitability resulted from increased revenue and operational improvements.

Systems Engineering Solutions

The Systems Engineering Solutions segment first quarter sales were $57.2 million, down 4.0 percent from 1999 first quarter sales of $59.6 million. Operating profit for the first quarter improved 14.3 percent to $5.6 million, from $4.9 million in the same period last year.

First quarter performance reflected strong sales growth and profitability improvements in systems engineering and integration, information technology, space programs, energy systems and environmental programs. The first quarter comparisons were negatively impacted by the significant decline in sales of marine products for the petroleum exploration market, which has been very weak since the second quarter of 1999. Operating results reflect a gain of approximately $1.4 million in the company's chemical weapon demilitarization business related to additional program funding, offset by a writedown of approximately $0.9 million in the company's process control software business.

Aerospace Engines and Components

The Aerospace Engines and Components segment first quarter sales were $60.6 million, up 2.4 percent from $59.2 million in 1999 first quarter. Operating profit declined by 13.8 percent to $7.5 million, from $8.7 million in the first quarter of 1999.

Sales and operating profit of piston engines for general aviation aircraft grew significantly, driven by strong sales of new engines to both OEMs and the aftermarket. The company is currently investigating a vendor related crankshaft issue involving approximately 1,100 engines. Teledyne Technologies has just begun field testing and continues to evaluate the matter. At this point, the company does not believe that it will have a material impact on earnings in 2000.

Sales and operating profit in the turbine engine business were down slightly due to reduced revenue from development phase work on new turbine engine programs. Sales of engines for the Harpoon missile and its derivatives continue to be strong, and during the quarter, the company reached an agreement with Lockheed Martin Corporation to supply turbine engines for the Joint Air-to-Surface Standoff Missile (JASSM) program.

Sales and operating profit from aerospace castings declined from the prior year due to market conditions, operational inefficiencies and a shift in product mix.

Additional Financial Information

The financial information for the first quarter of 1999 before pro forma adjustments includes a corporate allocation from Teledyne Technologies' former parent company.

First quarter earnings before interest, taxes, depreciation and amortization (EBITDA) for 2000 were $23.1 million, compared with pro forma EBITDA of $21.7 million for the first quarter of 1999. Net pension income for the first quarter was $2.2 million, compared with net pension income of $1.6 million for the same period of 1999. Capital expenditures for the first quarter increased to $3.6 million, compared with $2.8 million for the first quarter in 1999.

This press release contains forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995, relating to earnings, growth opportunities, capital investments and strategic plans. Actual results could differ materially from these forward-looking statements. Many factors, including the extent and timing of the required public offering, market, economic and political conditions, and funding and continuation of government programs, as well as the outcome of the crankshaft investigation, could change the anticipated results. Additional information concerning factors that could cause actual results to differ materially from those projected in the forward-looking statements is contained in Teledyne Technologies' periodic filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K.

Teledyne Technologies is a leading provider of sophisticated electronics and communication products, systems engineering solutions and aerospace engines and components. Teledyne Technologies has operations in the United States, the United Kingdom and Mexico. For more information, visit Teledyne Technologies' website at http://www.teledyne.com.

TELEDYNE TECHNOLOGIES INCORPORATED

TELEDYNE TECHNOLOGIES INCORPORATED

CONSOLIDATED STATEMENTS OF OPERATIONS

ACTUAL RESULTS FOR THE QUARTER ENDED APRIL 2, 2000 AND

PRO FORMA RESULTS FOR THE QUARTER ENDED APRIL 4, 1999

(Unaudited - In millions, except per share amounts)

 

 

 

First

 

 

First

 

 

 

 

Quarter

 

 

Quarter

 

 

 

 

2000

 

 

1999

 

 

 

 

 

 

        Net sales

 

$

203.5

 

$

202.0

 

        Costs and expenses:

 

 

 

 

 

 

 

             Costs of sales

 

 

147.9

 

 

151.5

 

             Selling, general and administrative expenses

 

 

36.9

 

 

32.2

 

        Income before other income and expense and taxes

 

 

18.7

 

 

18.3

 

             Other income

 

 

0.1

 

 

0.3

 

             Interest expense, net

 

 

1.8

 

 

2.0

 

        Income before taxes

 

 

17.0

 

 

16.6

 

             Provision for taxes

 

 

6.8

 

 

6.9

 

        Net income

 

$

10.2

 

$

9.7

 

Diluted earnings per common share

 

$

0.38

 

$

0.35

 

 

 

 

 

 

Weighted average common shares outstanding

 

 

27.1

 

 

27.6

 

 

 

 

 

 

EBITDA

 

$

23.1

 

$

21.7

 

The pro forma financial information has been presented for informational purposes only and may not reflect the results of operations or financial position of Teledyne Technologies that would have occurred had Teledyne Technologies operated as a separate, independent company for the 1999 period presented.  The pro forma financial information should not be relied upon as being indicative of future results. Pro forma adjustments reflect the estimated expense impacts (primarily interest expense and corporate expenses) that would have been incurred had Teledyne Technologies been operated as a separate company as of the beginning of the 1999 fiscal year and as capitalized at the time of the spin-off for the 1999 period presented.  As part of the spin-off, Teledyne Technologies incurred $100 million in long-term debt and Allegheny Teledyne (its former parent) retained the proceeds.  Pro forma income includes pro forma interest expense on the long-term debt as if it was outstanding for the 1999 period presented.  Pro forma income adjusts corporate expenses to an annual level of $15 million from the amount previously allocated, which was lower.

 

TELEDYNE TECHNOLOGIES INCORPORATED

HISTORICAL CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE QUARTERS ENDED APRIL 2, 2000 AND APRIL 4, 1999

(Unaudited - In millions, except per share amounts)

 

 

 

First

 

 

First

 

 

 

 

Quarter

 

 

Quarter

 

 

 

 

2000

 

 

1999

 

 

 

 

 

 

        Net sales

 

$

203.5

 

$

202.0

 

        Costs and expenses:

 

 

 

 

 

 

 

             Costs of sales

 

 

147.9

 

 

151.5

 

             Selling, general and administrative expenses

 

 

36.9

 

 

30.5

 

        Income before other income and expense and taxes

 

 

18.7

 

 

20.0

 

              Other income

 

 

0.1

 

 

0.3

 

              Interest expense, net

 

 

1.8

 

 

 

        Income before taxes

 

 

17.0

 

 

20.3

 

              Provision for taxes

 

 

6.8

 

 

8.4

 

        Net income

 

$

10.2

 

$

11.9

 

Diluted earnings per common share

 

$

0.38

 

$

0.43

 

 

 

 

 

 

Weighted average common shares outstanding

 

 

27.1

 

 

27.6

 

 

 

 

 

 

EBITDA

 

$

23.1

 

$

23.4

 


 

TELEDYNE TECHNOLOGIES INCORPORATED

SUMMARY OF SEGMENT NET SALES AND OPERATING PROFIT

FOR THE QUARTERS ENDED APRIL 2, 2000 AND APRIL 4, 1999

(Unaudited - In millions of dollars)

 

 

 

First

 

 

First

 

 

 

 

Quarter

 

 

Quarter

 

 

 

 

2000

 

 

1999

 

 

 

 

 

 

        NET SALES:

 

 

 

 

 

 

 

        Electronics and Communications

 

$

85.7

 

$

83.2

 

        Systems Engineering Solutions

 

 

57.2

 

 

59.6

 

        Aerospace Engines and Components

 

 

60.6

 

 

59.2

 

             Total net sales

 

$

203.5

 

$

202.0

 

       

 

 

 

 

 

 

 

        OPERATING PROFIT:

 

 

 

 

 

 

 

        Electronics and Communications

 

$

9.5

 

$

8.5

 

        Systems Engineering Solutions

 

 

5.6

 

 

4.9

 

        Aerospace Engines and Components

 

 

7.5

 

 

8.7

 

             Total operating profit

 

$

22.6

 

$

22.1

 

 


 

TELEDYNE TECHNOLOGIES INCORPORATED

BALANCE SHEET FOR THE QUARTER ENDED APRIL 2, 2000

AND THE FISCAL YEAR ENDED JANUARY 2, 2000.

(Current period unaudited - In millions of dollars)

 

 

 

 

 

 

 

 

 

 

 

 

   April 2,

    January 2,

 

 

 

 

2000

 

 

2000

 

 

 

 

 

 

 

 

        ASSETS

 

 

 

 

 

 

 

 

        Cash and cash equivalents

 

$

4.6

 

$

7.1

 

 

        Accounts receivable, net

 

 

127.2

 

 

117.6

 

 

        Inventories, net

 

 

54.4

 

 

53.7

 

 

        Deferred income taxes, net

 

 

24.0

 

 

21.7

 

 

        Prepaid expenses and other current assets

 

 

3.7

 

 

4.5

 

 

             Total Current Assets

 

 

213.9

 

 

204.6

 

 

 

 

 

 

 

 

 

 

 

        Property, plant and equipment, net

 

 

62.2

 

 

62.1

 

 

        Deferred income taxes, net

 

 

25.9

 

 

25.6

 

 

        Cost in excess of net assets acquired, net

 

 

8.0

 

 

8.2

 

 

        Other assets

 

 

18.0

 

 

16.9

 

 

             Total Assets

 

$

328.0

 

$

317.4

 

 

 

 

 

 

 

 

 

 

 

        LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

        Accounts payable

 

$

50.3

 

$

46.9

 

 

        Accrued liabilities

 

 

56.4

 

 

48.6

 

 

        Income taxes payable

 

 

8.5

 

 

3.8

 

 

             Total Current Liabilities

 

 

115.2

 

 

99.3

 

 

 

 

 

 

 

 

        Long-term debt

 

 

83.5

 

 

97.0

 

 

        Other long-term liabilities

 

 

74.0

 

 

76.6

 

 

             Total Liabilities

 

 

272.7

 

 

272.9

 

 

 

 

 

 

 

 

             Total Stockholders' Equity

 

 

55.3

 

 

44.5

 

 

 

 

 

 

 

 

              Total Liabilities and Stockholders’ Equity

 

$

328.0

 

$

317.4

 

 

 

Investor Contact:
Jason VanWees
(310) 893-1642

Press Contact:
Robyn McGowan
(310) 893-1640




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