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FOR IMMEDIATE RELEASE
Esterline To Open Sales/Engineering Facility In Toulouse,
France
Updates Outlook: Solid Defense Business Continues
to Balance Commercial Aerospace Softness
BELLEVUE, Wash., July 1, 2003--Esterline Technologies (NYSE/ESL www.esterline.com)
today announced plans to open a sales and engineering facility in Toulouse,
France, to better serve its growing presence in Europe. More than 25%
of Esterline’s nearly $600 million annualized sales are now generated
from its manufacturing operations in France and the UK.
Robert W. Cremin, Esterline CEO, said, “…we add value by
addressing our customers’ complex requirements with unique, highly
engineered aerospace solutions, ranging from flight controls to advanced
materials. Our success lies in our customers’ confidence that they
will have maximum access to our engineers whenever they need it.” Cremin
said that Esterline has “…a long standing reputation for
investing in its operations no matter where we are in a given cycle.” Despite
the current softness in commercial aerospace, he said, “…there’s
no better time to strengthen our presence in the heart of Europe’s
aerospace community.”
Two weeks ago, Esterline finalized the acquisition of UK-based Weston
Aerospace. “This move,” said Cremin, “when combined
with our existing France-based sensors operation, increases our high-end
aerospace sensors business by nearly 50%, and creates a true market leader
to serve the world’s jet engine manufacturers.”
Esterline also
recently completed a private placement of $175 million in senior subordinated
notes. Cremin said that the “…bond
investors looked very favorably on our performance and our ability to
continue executing on our strategy, pricing the offering at 7.75%, a
very attractive rate for a first time issuer.” He said the proceeds
would be used in part to fund the Weston acquisition and pay down some
existing debt but also to “…continue to invest in the future
of the company with such strategic moves as our new Toulouse facility.”
Cremin said the recent Paris Airshow provided a good forum to announce “…our
new facility and also a unique opportunity to take the pulse of our industry.
While commercial aircraft customers continue to reflect the uncertainties
of the market, defense customers are optimistic if not bullish.”
With about 35% of Esterline’s revenues generated from commercial
aerospace, 45% from defense, and another 20% from expanding industrial
applications, “…we’re cautiously optimistic about the
remainder of the year,” Cremin said. “Defense business is solid,
commercial is still uncertain, but, all things considered, our best estimate
for fiscal 2003 earnings from continuing operations is about $1.20 per
share.”
In addition, on June 28, Esterline entered into an agreement to sell substantially
all the assets of its discontinued Excellon Automation subsidiary to a
private party. Details of the agreement were not disclosed; the sale is
subject to customary closing conditions. As previously reported, Esterline
adopted a formal plan on July 25, 2002, to sell its Automation segment,
which included Excellon. As part of this decision, the Automation segment
was recorded as a “discontinued operation” as defined by GAAP
(Generally Accepted Accounting Principles) in the company’s fiscal
third quarter of 2002 ended July 26. Esterline continues to report this
segment as a “discontinued operation.”
This press release contains "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements are based on the current intent and
expectations of the management of Esterline, are not guarantees of future
performance, and involve risks and uncertainties that are difficult to
predict. 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 changes in aerospace/defense industry
demand or because of current uncertainties associated with telecommunications
and computer markets and other risks detailed in the company's public
filings with the Securities and Exchange Commission, including the company's
Annual Report on Form 10-K for the year ended October 25, 2002.
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