ESTERLINE TECHNOLOGIES CORPORATION
Consolidated Statement of Operations (unaudited)
In thousands, except per share amounts
Three months ended Fiscal year ended
Oct 31, Oct 26, Oct 31, Oct 26,
2008 2007 2008 2007
---------- ---------- ---------- ----------
Segment Sales
Avionics & Controls $ 173,459 $ 151,611 $ 611,467 $ 461,990
Sensors & Systems 89,987 84,363 384,180 316,485
Advanced Materials 140,904 119,721 487,525 428,558
---------- ---------- ---------- ----------
Net Sales 404,350 355,695 1,483,172 1,207,033
Cost of Sales 263,989 242,595 992,853 833,977
---------- ---------- ---------- ----------
140,361 113,100 490,319 373,056
Expenses
Selling, general and
administrative 61,200 58,594 239,282 199,825
Research, development and
engineering 18,660 19,883 86,798 66,891
---------- ---------- ---------- ----------
Total Expenses 79,860 78,477 326,080 266,716
Other
Other expense -- -- 86 24
Insurance recovery -- (153) -- (37,467)
---------- ---------- ---------- ----------
Total Other -- (153) 86 (37,443)
---------- ---------- ---------- ----------
Operating Earnings From
Continuing Operations 60,501 34,776 164,153 143,783
Interest income (1,077) (1,209) (4,374) (3,095)
Interest expense 7,405 10,257 29,922 35,300
Gain on derivative
financial instrument -- -- (1,850) --
Loss on extinguishment of
debt -- 1,100 -- 1,100
---------- ---------- ---------- ----------
Other Expense, Net 6,328 10,148 23,698 33,305
---------- ---------- ---------- ----------
Income From Continuing
Operations
Before Income Taxes 54,173 24,628 140,455 110,478
Income Tax Expense 12,582 4,123 26,563 22,563
---------- ---------- ---------- ----------
Income From Continuing
Operations
Before Minority Interest 41,591 20,505 113,892 87,915
Minority Interest (154) (36) (383) (153)
---------- ---------- ---------- ----------
Income From Continuing
Operations 41,437 20,469 113,509 87,762
Income From Discontinued
Operations, Net of Tax 2,445 419 7,024 4,522
---------- ---------- ---------- ----------
Net Earnings $ 43,882 $ 20,888 $ 120,533 $ 92,284
========== ========== ========== ==========
Earnings Per Share - Basic:
Continuing Operations $ 1.40 $ .77 $ 3.85 $ 3.40
Discontinued Operations .08 .02 .23 .17
---------- ---------- ---------- ----------
Earnings Per Share - Basic $ 1.48 $ .79 $ 4.08 $ 3.57
========== ========== ========== ==========
Earnings Per Share - Diluted:
Continuing Operations $ 1.38 $ .76 $ 3.80 $ 3.34
Discontinued Operations .08 .02 .23 .18
---------- ---------- ---------- ----------
Earnings Per Share -
Diluted $ 1.46 $ .78 $ 4.03 $ 3.52
========== ========== ========== ==========
Weighted Average Number
of Shares
Outstanding-Basic 29,635 26,484 29,507 25,824
Weighted Average Number
of Shares
Outstanding-Diluted 29,955 26,940 29,908 26,252
Consolidated Balance Sheet (unaudited)
In thousands Oct 31, Oct 26,
2008 2007
----------- -----------
Assets
Current Assets
Cash and cash equivalents $ 160,645 $ 147,069
Accounts receivable, net 297,506 262,087
Inventories 261,973 258,176
Income tax refundable 5,567 11,580
Deferred income tax benefits 30,463 37,830
Prepaid expenses 13,040 13,256
Other current assets 897 --
----------- -----------
Total Current Assets 770,091 729,998
Property, Plant and Equipment, Net 204,462 217,421
Other Non-Current Assets
Goodwill 576,861 656,865
Intangibles, net 290,440 365,317
Debt issuance costs, net 7,587 9,192
Deferred income tax benefits 50,040 43,670
Other assets 9,601 27,843
----------- -----------
$ 1,909,082 $ 2,050,306
=========== ===========
Liabilities and Shareholders' Equity
Current Liabilities
Accounts payable $ 89,807 $ 90,257
Accrued liabilities 210,422 187,596
Credit facilities 5,171 8,634
Current maturities of long-term debt 8,388 12,166
Federal and foreign income taxes 4,442 11,247
----------- -----------
Total Current Liabilities 318,230 309,900
Long-Term Liabilities
Long-term debt, net of current
maturities 388,248 455,002
Deferred income taxes 87,699 123,758
Other liabilities 85,767 36,852
Commitments and Contingencies -- --
Minority Interest 2,797 2,968
Shareholders' Equity 1,026,341 1,121,826
----------- -----------
$ 1,909,082 $ 2,050,306
=========== ===========
Esterline Reports Record Fourth Quarter Results
Income From Continuing Operations $41.4 Million, or $1.38 per Share, on $404.4 Million Sales
| Source: Esterline Technologies
BELLEVUE, WA--(Marketwire - December 11, 2008) - Esterline Corporation (NYSE : ESL )
(www.esterline.com), a leading specialty manufacturer serving
aerospace/defense markets, today reported fiscal 2008 fourth quarter and
full-year results for the period ended October 31, 2008. Net income from
continuing operations for the quarter was a record $41.4 million, or $1.38
per diluted share, on sales of $404.4 million. For the same period last
year, income from continuing operations was $20.5 million, or $.76 per
diluted share, on sales of $355.7 million. (Continuing operations exclude
results from Esterline's Muirhead Aerospace subsidiary, divested on
November 3, 2008.)
For the full year ended October 31, 2008, Esterline reported net earnings
from continuing operations of $113.5 million, or $3.80 per diluted share,
on sales of $1.48 billion, compared with net earnings from continuing
operations of $87.8 million, or $3.34 per diluted share, on $1.21 billion
in sales in 2007. Full year 2007 results included an after-tax gain of
$26.2 million, or $1.00 per diluted share, due to an insurance recovery.
Robert W. Cremin, Esterline CEO, said, "...with strong organic growth we
recorded another solid year, benefiting from improved performance across
the board in each of our three operating segments." Cremin said that
top-line organic growth was 14% and 17% respectively for the fourth quarter
and full year, when compared to
same-period 2007 results. He pointed out that fourth quarter earnings were
bolstered by the recently strengthening U.S. dollar. Noting that aerospace
pricing is primarily denominated in U.S. dollars, Cremin said that with
"...nearly half of our manufacturing operations outside the U.S. -- most
notably in Canada, France and the U.K.
-- the headwind we faced for most of the year has shifted in our favor."
Fourth quarter 2008 research, development and engineering (R&D) expense
totaled $18.7 million, or 4.6% of sales, compared with $19.9 million, or
5.6% of sales, in the same quarter a year ago. Full-year 2008 R&D totaled
$86.8 million, or 5.9% of sales, compared with $66.9 million, or 5.5% of
sales, last year. Cremin noted that the recent downward trend reflects
"...a return to more normalized R&D investment following several years of
successful efforts to secure Tier 1 positions on a number of major programs
that will fly for decades to come." He added that, "...for the hundreds of
active aircraft platforms flying today, our total dollar content per
aircraft is growing steadily due to our constant technology advancements,
new products and market share gains."
Cremin also noted the company's cash generating capability, pointing out
that Esterline retired approximately $64 million in term loans and other
debt during the year.
Backlog at fiscal year end was $1.1 billion, ahead of last year by nearly
14%. Orders received in the fourth quarter totaled $469.4 million
-- up 31% on both a year-over-year and sequential basis. Cremin said he
was optimistic about the company's prospects, and estimated full-year 2009
earnings per share from continuing operations to be in the range of $3.70
to $3.90.
Cremin said, "...our core strategy positions us to perform well no matter
where we are in a cycle." He pointed to Esterline's diverse product mix,
balanced global market position, and underlying entrepreneurial culture as
"...key underpinnings of achieving success during difficult market
conditions."
This press release contains "forward-looking statements" within the meaning
of the Private Securities Litigation Reform Act of 1995. These statements
relate to future events or our future financial performance. In some cases,
you can identify forward-looking statements by terminology such as
"anticipate," "believe," "continue," "could," "estimate," "expect,"
"intend," "may," "might," "plan," "potential," "predict," "should" or
"will," or the negative of such terms, or other comparable terminology.
These forward-looking statements are only predictions based on the current
intent and expectations of the management of Esterline, are not guarantees
of future performance or actions, and involve risks and uncertainties that
are difficult to predict and may cause Esterline's or its industry's actual
results, performance or achievements to be materially different from any
future results, performance or achievements expressed or implied by the
forward-looking statements. Esterline's actual results and the timing and
outcome of events may differ materially from those expressed in or implied
by the forward-looking statements due to risks detailed in Esterline's
public filings with the Securities and Exchange Commission including its
most recent Annual Report on Form 10-K.