Esterline Technologies Corp. (ESL, Financial) filed Quarterly Report for the period ended 2009-05-01.
Esterline Technologies Corporation is a specialized engineering and manufacturing company principally serving aerospace and defense markets. They design manufacture and market highly engineered products and systems for application within the industries they serve. Their products are found on most military and commercial aircraft helicopters and land-based systems. Their sales are diversified across three broad markets: defense commercial aerospace and general industrial. Esterline Technologies Corp. has a market cap of $863.1 million; its shares were traded at around $29.07 with a P/E ratio of 8.9 and P/S ratio of 0.6. Esterline Technologies Corp. had an annual average earning growth of 3.5% over the past 10 years.
Income from discontinued operations was $0.53 per diluted share, compared with $0.08 per diluted share in the prior-year period, reflecting the gain on sale of our U.K.-based Muirhead and Traxsys subsidiaries in November 2008. Net income was $52.7 million, or $1.76 per diluted share, compared with net income of $56.2 million, or $1.88 per diluted share, in the prior-year period.
The $0.3 million tax benefit in the first six months of 2009 was the result of three events. The first event was a $2.0 million reduction of previously recorded withholding tax liabilities as a result of the enactment of a U.S.-Canadian tax treaty. The second event was the recording of a $1.6 million tax expense as a result of accruing a penalty due to a development with regard to certain foreign tax laws. The third event was a $0.7 million expense resulting from the reversal of previously recorded tax benefits associated with the implementation of CMCs SADI program. The $6.2 million tax benefit in the first six months of 2008 was the result of three events. The first event was the settlement of an examination of the U.S. federal income tax returns for fiscal years 2003 through 2005, which resulted in a $2.8 million reduction of previously estimated income tax liabilities. The second event was the enactment of tax laws reducing the Canadian statutory corporate income tax rate, which resulted in a $4.1 million net reduction of deferred income tax liabilities. The third event was the recognition of $0.7 million of additional income tax liabilities at CMC. The effective tax rate differed from the statutory rate in the first six months of 2009 and 2008, as both years benefited from various tax credits and certain foreign interest expense deductions.
Cash and cash equivalents at May 1, 2009, totaled $115.4 million, a decrease of $45.2 million from October 31, 2008. Net working capital decreased to $429.0 million at May 1, 2009, from $456.2 million at October 31, 2008. Sources and uses of cash flows from operating activities principally consist of cash received from the sale of products and cash payments for material, labor and operating expenses. Cash flows provided by operating activities were $40.3 million and $59.2 million in the first six months of 2009 and 2008, respectively. The decrease principally reflected lower income from continuing operations, increased payments for income taxes, inventory for new program builds, and incentive compensation payments, which are paid annually in the first fiscal quarter of each year. The decrease in cash flows provided by operating activities was partially offset by increased cash receipts from customers for shipments and advanced payments on long-term contracts.
Cash flows used by investing activities were $208.4 million and $32.7 million in the first six months of 2009 and 2008, respectively. Cash flows used by investing activities in the first six months of 2009 primarily reflected approximately $250.8 million for the acquisitions of NMC and Racal, and $20.9 million in purchases of capital assets, partially offset by proceeds from the sale of Muirhead and Traxsys of $62.9 million. Cash flows used by investing activities in the prior-year period included $21.3 million in purchases of capital assets and $12.1 million in purchases of short-term investments.
Total debt at May 1, 2009, was $528.4 million and consisted of $175.0 million of Senior Notes due in 2017, $175.0 million of Senior Subordinated Notes due in 2013, $125.0 million under our U.S. term loan, $29.6 million under our GBP term loan, and $23.8 million of various foreign currency debt agreements and other debt agreements, including capital lease obligations.
Read the The complete ReportESL is in the portfolios of David Dreman of Dreman Value Management, Kenneth Fisher of Fisher Asset Management, LLC.
Esterline Technologies Corporation is a specialized engineering and manufacturing company principally serving aerospace and defense markets. They design manufacture and market highly engineered products and systems for application within the industries they serve. Their products are found on most military and commercial aircraft helicopters and land-based systems. Their sales are diversified across three broad markets: defense commercial aerospace and general industrial. Esterline Technologies Corp. has a market cap of $863.1 million; its shares were traded at around $29.07 with a P/E ratio of 8.9 and P/S ratio of 0.6. Esterline Technologies Corp. had an annual average earning growth of 3.5% over the past 10 years.
Highlight of Business Operations:
Income from continuing operations for the first six months of 2009 includes a $2.0 million, or $0.07 per diluted share, reduction of previously recorded withholding tax liabilities as a result of the enactment of a U.S.-Canadian tax treaty, a $1.6 million, or $0.05 per diluted share, penalty due to a development with regard to certain foreign tax laws and a $0.7 million, or $0.03 per diluted share, expense resulting from the reversal of previously recorded tax benefits associated with CMCs SADI program. Prior-year results include a $2.8 million, or $0.09 per diluted share, reduction of previously estimated income tax liabilities, a $4.1 million, or $0.14 per diluted share, net reduction in deferred income tax liabilities resulting from the enactment of tax laws reducing the Canadian statutory corporate income tax rate, and a $0.7 million, or $0.02 per diluted share, net increase in income tax liabilities at CMC.Income from discontinued operations was $0.53 per diluted share, compared with $0.08 per diluted share in the prior-year period, reflecting the gain on sale of our U.K.-based Muirhead and Traxsys subsidiaries in November 2008. Net income was $52.7 million, or $1.76 per diluted share, compared with net income of $56.2 million, or $1.88 per diluted share, in the prior-year period.
The $0.3 million tax benefit in the first six months of 2009 was the result of three events. The first event was a $2.0 million reduction of previously recorded withholding tax liabilities as a result of the enactment of a U.S.-Canadian tax treaty. The second event was the recording of a $1.6 million tax expense as a result of accruing a penalty due to a development with regard to certain foreign tax laws. The third event was a $0.7 million expense resulting from the reversal of previously recorded tax benefits associated with the implementation of CMCs SADI program. The $6.2 million tax benefit in the first six months of 2008 was the result of three events. The first event was the settlement of an examination of the U.S. federal income tax returns for fiscal years 2003 through 2005, which resulted in a $2.8 million reduction of previously estimated income tax liabilities. The second event was the enactment of tax laws reducing the Canadian statutory corporate income tax rate, which resulted in a $4.1 million net reduction of deferred income tax liabilities. The third event was the recognition of $0.7 million of additional income tax liabilities at CMC. The effective tax rate differed from the statutory rate in the first six months of 2009 and 2008, as both years benefited from various tax credits and certain foreign interest expense deductions.
Cash and cash equivalents at May 1, 2009, totaled $115.4 million, a decrease of $45.2 million from October 31, 2008. Net working capital decreased to $429.0 million at May 1, 2009, from $456.2 million at October 31, 2008. Sources and uses of cash flows from operating activities principally consist of cash received from the sale of products and cash payments for material, labor and operating expenses. Cash flows provided by operating activities were $40.3 million and $59.2 million in the first six months of 2009 and 2008, respectively. The decrease principally reflected lower income from continuing operations, increased payments for income taxes, inventory for new program builds, and incentive compensation payments, which are paid annually in the first fiscal quarter of each year. The decrease in cash flows provided by operating activities was partially offset by increased cash receipts from customers for shipments and advanced payments on long-term contracts.
Cash flows used by investing activities were $208.4 million and $32.7 million in the first six months of 2009 and 2008, respectively. Cash flows used by investing activities in the first six months of 2009 primarily reflected approximately $250.8 million for the acquisitions of NMC and Racal, and $20.9 million in purchases of capital assets, partially offset by proceeds from the sale of Muirhead and Traxsys of $62.9 million. Cash flows used by investing activities in the prior-year period included $21.3 million in purchases of capital assets and $12.1 million in purchases of short-term investments.
Total debt at May 1, 2009, was $528.4 million and consisted of $175.0 million of Senior Notes due in 2017, $175.0 million of Senior Subordinated Notes due in 2013, $125.0 million under our U.S. term loan, $29.6 million under our GBP term loan, and $23.8 million of various foreign currency debt agreements and other debt agreements, including capital lease obligations.
Read the The complete ReportESL is in the portfolios of David Dreman of Dreman Value Management, Kenneth Fisher of Fisher Asset Management, LLC.
