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News
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FOR IMMEDIATE RELEASE
Esterline Reports Fourth Quarter EPS of $.44; Earnings
of $9.4 Million on $160.3 Million Sales
Solid Sales to Defense and Other Specialty Markets
Help Outpace Earlier Forecast
BELLEVUE, Wash., Dec. 4, 2003 — Esterline Technologies (NYSE/ESL
www.esterline.com), a leading specialty manufacturer serving aerospace/defense
markets, today reported strong fourth quarter performance, exceeding
forecasted results for the quarter and fiscal year ended October 31.
Fourth quarter income from continuing operations was $9.4 million, or
$.44 per diluted share, on sales of $160.3 million. In the same period
last year, income from continuing operations was $10.5 million, or $.50
per diluted share including $.14 per share from the favorable resolution
of income tax audits, on sales of $124.9 million. Net income for the
fourth quarter was $9.4 million,
or $.44 per diluted share, compared with $7.6 million, or $.36 per share.
Full year 2003 income
from continuing operations was $29.7 million, or $1.41 per diluted share,
including a third quarter foreign currency gain of approximately $1.9
million net of tax, or $.09 per share. The prior year’s income
from continuing operations was $31.3 million, or $1.49 per diluted share,
including the favorable tax resolution of tax audits. Fiscal 2003 sales
were $562.5 million compared with last year’s sales of $434.8 million.
Robert W. Cremin, Esterline CEO, noted that the company continues to
perform well despite commercial aerospace market conditions that remain
sluggish. Cremin said that the company is focused on consolidating recent
acquisitions—transactions that added about $90 million in incremental
sales during the year. “As consolidation progresses, combined with
slowly improving market conditions, we expect to begin to see steady
performance improvement.” And he emphasized that even without acquisitions, “…the
performance was solid, with organic growth of roughly 10%.”
He attributed this performance principally to improved sales volumes
of technology interface systems, including specialized switches, displays
and controls for aircraft and land-based military vehicles and high-end
medical equipment, as well as increased shipments of combustible ordnance
components.
Cremin said he was encouraged
by the results, including two consecutive quarters of improving margins.
He remained cautious about the near-term,
however, reminding shareholders that Esterline’s first quarter
results are typically weaker than other quarters due to holiday plant
closures and customer buying patterns. In addition, he said the company
anticipates “…a one-time charge of about $.10 per share in
the first half for severance expense related to the
merger of recently acquired Weston Aerospace and our Auxitrol operation.”
He added though, that commercial aerospace “…appears to be
at the bottom of the cycle, and we expect defense markets to remain strong
and key industrial business to improve.” He said that “…all
in all, a reasonable earnings expectation for fiscal 2004 would be in
the “…$1.50 to $1.60 range.”
Including charges for discontinued operations of $5.8 million net of
tax, fiscal 2003 net earnings were $23.9 million, or $1.13 per diluted
share. This compared with a loss of $1.3 million, or ($.06) per diluted
share, for fiscal 2002, including a loss from discontinued operations
of $25.0 million, or ($1.19) per diluted share, and a $7.6 million charge,
or ($.36) per diluted share, for the cumulative effect of an accounting
change as a result of the adoption of Financial Accounting Standards
No. 142, “Goodwill and Other Intangible Assets.”
Orders received in the fourth quarter totaled $140.0 million compared
with $155.2 million a year ago. Backlog at October 31, 2003, was $300.9
million compared with $281.7 million at the end of the prior-year period.
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 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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