Teledyne Technologies Inc. (TDY, Financial) filed Quarterly Report for the period ended 2009-03-29.
Teledyne Technologies Inc. is a leading provider of sophisticated electronic and communication products systems engineering solutions and information technology services and aerospace engines and components. The company customers include aerospace prime contractors general aviation companies government agencies and major communications and other commercial companies. Teledyne Technologies Inc. has a market cap of $1.17 billion; its shares were traded at around $32.41 with a P/E ratio of 10.3 and P/S ratio of 0.6. Teledyne Technologies Inc. had an annual average earning growth of 33.2% over the past 5 years.
The first quarter 2009 sales improvement resulted from revenue growth in electronic instruments and defense electronics, partially offset by lower sales of other commercial electronics. The revenue growth in electronic instruments was driven by organic sales growth and acquisitions made in 2008. Organic sales growth in electronic instruments primarily reflected increased sales of geophysical sensors for the energy exploration market partially offset by lower sales of electronic instruments for the environmental monitoring and industrial markets. The revenue growth in defense electronics was primarily driven by acquisitions made in 2008. Lower sales of other commercial electronics reflected reduced sales of avionics, medical manufacturing services and other electronic components. The increase in segment revenue in the first quarter of 2009 from acquisitions made in 2008 was $16.3 million. The incremental operating loss in the first quarter of 2009 from businesses acquired in 2008, was $0.5 million and reflected the impact of intangible asset amortization and the timing of research and development expenditures. Operating profit included pension expense under SFAS No. 87 and No. 158, of $2.4 million in the first quarter of 2009, compared with $0.8 million in the first quarter of 2008. Pension expense allocated to contracts pursuant to CAS was $0.6 million in the first quarter of 2009, compared with $0.4 million in the first quarter of 2008. Total year sales of marine instruments, which serve the offshore exploration market, are expected to decline in 2009, especially in the second half of 2009, compared with total year 2008.
Our net cash used by investing activities was $18.7 million for the first three months of 2009, compared with cash used by investing activities of $174.9 million for the first three months of 2008. The 2009 amount included $5.9 million paid for the purchase of ODI shares and a $0.3 million receipt for a purchase price adjustment . The 2008 amount included $166.2 million for the purchase of businesses, net of cash acquired.
On August 16, 2006, Teledyne Technologies through its subsidiary, Teledyne Instruments, Inc., acquired an initial majority interest in ODI for approximately $30 million in cash. Pursuant to agreements in connection with our acquisition of a majority interest in ODI, the ODI minority stockholders have the contractual option to sell their shares to Teledyne Instruments following the end of each quarter through the quarter ended March 31, 2009, at a formula-determined price based principally on ODIs earnings before interest, taxes, depreciation and amortization (EBITDA) for the twelve months preceding each applicable quarter end. Ownership purchases in ODI were as follows, including the initial purchase: 2006 60.9% for $35.8 million, 2007 0.9% for $0.9 million, 2008 24.1% for $38.5 million and 2009 3.4% for $5.9 million. All shares not sold to Teledyne Instruments following the quarter ended March 31, 2009, are required to be purchased by Teledyne Instruments following the quarter ended June 30, 2009, at a same formula-determined price, at which time Teledyne Instruments will own all of the ODI shares held by the stockholders. Based on the formula-determined purchase price as of the quarter ended
March 29, 2009, the aggregate amount of funds required to purchase all the shares held by the remaining minority ODI stockholders would be approximately $18.3 million and is recorded at fair value of $18.3 million and is included as part of redeemable noncontrolling interest on the balance sheet. However, the actual aggregate amount of funds that we will spend to purchase the shares held by minority stockholders through June 30, 2009, could be higher or lower than this amount, as that amount will depend on when individual stockholders elect to exercise their put options and on the financial performance of ODI. Teledyne Technologies has guaranteed the payment obligation of its subsidiary, Teledyne Instruments. The balance of redeemable noncontrolling interest at March 29, 2009, includes the $18.3 million obligation and a noncontrolling interest in ODI of $3.3 million.
Cash used by financing activities for the first three months of 2009 included net borrowings of $28.4 million, primarily to fund the pension contribution in the first quarter and to purchase an additional shares in ODI. Cash used by financing activities for the first three months of 2008 included net borrowings of $157.2 million, primarily to fund acquisitions. Proceeds from the exercise of stock options were $0.1 million and $1.8 million for the first three months of 2009 and 2008, respectively. The first three months of 2008 included $1.1 million, in excess tax benefits related to stock-based compensation. Teledyne Technologies paid $0.8 million to repurchase 36,239 shares of Teledyne common stock under a stock repurchase program announced in February 2009. Under the stock repurchase program, Teledyne can repurchase up to 1,500,000 shares of its common stock. Shares may be repurchased from time to time in open market transactions at prevailing market prices or in privately negotiated transactions through February 28, 2010. The timing and actual number of shares repurchased will depend on a variety of factors, such as price, corporate and regulatory requirements, alternative investment opportunities, and other market and economic conditions. Repurchases will be funded with cash on hand and borrowings under the Companys credit facility.
Read the The complete ReportTDY is in the portfolios of John Keeley of Keeley Fund Management, Kenneth Fisher of Fisher Asset Management, LLC, Kenneth Fisher of Fisher Asset Management, LLC.
Teledyne Technologies Inc. is a leading provider of sophisticated electronic and communication products systems engineering solutions and information technology services and aerospace engines and components. The company customers include aerospace prime contractors general aviation companies government agencies and major communications and other commercial companies. Teledyne Technologies Inc. has a market cap of $1.17 billion; its shares were traded at around $32.41 with a P/E ratio of 10.3 and P/S ratio of 0.6. Teledyne Technologies Inc. had an annual average earning growth of 33.2% over the past 5 years.
Highlight of Business Operations:
Teledyne Technologies first quarter 2009 sales were $440.3 million, compared with sales of $451.8 million for the same period of 2008, a decrease of 2.5%. Net income attributable to common stockholders for the first quarter of 2009 was $20.8 million ($0.57 per diluted share) compared with net income attributable to common stockholders of $27.9 million ($0.77 per diluted share) for the first quarter of 2008, a decrease of 25.4%. The decrease in sales for the 2009 period, compared with the same 2008 period, reflected the impact of the general economic downturn, partially offset by revenue from acquisitions.The first quarter 2009 sales improvement resulted from revenue growth in electronic instruments and defense electronics, partially offset by lower sales of other commercial electronics. The revenue growth in electronic instruments was driven by organic sales growth and acquisitions made in 2008. Organic sales growth in electronic instruments primarily reflected increased sales of geophysical sensors for the energy exploration market partially offset by lower sales of electronic instruments for the environmental monitoring and industrial markets. The revenue growth in defense electronics was primarily driven by acquisitions made in 2008. Lower sales of other commercial electronics reflected reduced sales of avionics, medical manufacturing services and other electronic components. The increase in segment revenue in the first quarter of 2009 from acquisitions made in 2008 was $16.3 million. The incremental operating loss in the first quarter of 2009 from businesses acquired in 2008, was $0.5 million and reflected the impact of intangible asset amortization and the timing of research and development expenditures. Operating profit included pension expense under SFAS No. 87 and No. 158, of $2.4 million in the first quarter of 2009, compared with $0.8 million in the first quarter of 2008. Pension expense allocated to contracts pursuant to CAS was $0.6 million in the first quarter of 2009, compared with $0.4 million in the first quarter of 2008. Total year sales of marine instruments, which serve the offshore exploration market, are expected to decline in 2009, especially in the second half of 2009, compared with total year 2008.
Our net cash used by investing activities was $18.7 million for the first three months of 2009, compared with cash used by investing activities of $174.9 million for the first three months of 2008. The 2009 amount included $5.9 million paid for the purchase of ODI shares and a $0.3 million receipt for a purchase price adjustment . The 2008 amount included $166.2 million for the purchase of businesses, net of cash acquired.
On August 16, 2006, Teledyne Technologies through its subsidiary, Teledyne Instruments, Inc., acquired an initial majority interest in ODI for approximately $30 million in cash. Pursuant to agreements in connection with our acquisition of a majority interest in ODI, the ODI minority stockholders have the contractual option to sell their shares to Teledyne Instruments following the end of each quarter through the quarter ended March 31, 2009, at a formula-determined price based principally on ODIs earnings before interest, taxes, depreciation and amortization (EBITDA) for the twelve months preceding each applicable quarter end. Ownership purchases in ODI were as follows, including the initial purchase: 2006 60.9% for $35.8 million, 2007 0.9% for $0.9 million, 2008 24.1% for $38.5 million and 2009 3.4% for $5.9 million. All shares not sold to Teledyne Instruments following the quarter ended March 31, 2009, are required to be purchased by Teledyne Instruments following the quarter ended June 30, 2009, at a same formula-determined price, at which time Teledyne Instruments will own all of the ODI shares held by the stockholders. Based on the formula-determined purchase price as of the quarter ended
March 29, 2009, the aggregate amount of funds required to purchase all the shares held by the remaining minority ODI stockholders would be approximately $18.3 million and is recorded at fair value of $18.3 million and is included as part of redeemable noncontrolling interest on the balance sheet. However, the actual aggregate amount of funds that we will spend to purchase the shares held by minority stockholders through June 30, 2009, could be higher or lower than this amount, as that amount will depend on when individual stockholders elect to exercise their put options and on the financial performance of ODI. Teledyne Technologies has guaranteed the payment obligation of its subsidiary, Teledyne Instruments. The balance of redeemable noncontrolling interest at March 29, 2009, includes the $18.3 million obligation and a noncontrolling interest in ODI of $3.3 million.
Cash used by financing activities for the first three months of 2009 included net borrowings of $28.4 million, primarily to fund the pension contribution in the first quarter and to purchase an additional shares in ODI. Cash used by financing activities for the first three months of 2008 included net borrowings of $157.2 million, primarily to fund acquisitions. Proceeds from the exercise of stock options were $0.1 million and $1.8 million for the first three months of 2009 and 2008, respectively. The first three months of 2008 included $1.1 million, in excess tax benefits related to stock-based compensation. Teledyne Technologies paid $0.8 million to repurchase 36,239 shares of Teledyne common stock under a stock repurchase program announced in February 2009. Under the stock repurchase program, Teledyne can repurchase up to 1,500,000 shares of its common stock. Shares may be repurchased from time to time in open market transactions at prevailing market prices or in privately negotiated transactions through February 28, 2010. The timing and actual number of shares repurchased will depend on a variety of factors, such as price, corporate and regulatory requirements, alternative investment opportunities, and other market and economic conditions. Repurchases will be funded with cash on hand and borrowings under the Companys credit facility.
Read the The complete ReportTDY is in the portfolios of John Keeley of Keeley Fund Management, Kenneth Fisher of Fisher Asset Management, LLC, Kenneth Fisher of Fisher Asset Management, LLC.
