<PAGE>
Page 1 of 15
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of
1934
For Quarter Ended June 26, 1999
Commission File Number 1-3985
EDO CORPORATION
(Exact name of registrant as specified in its charter)
New York No. 11-0707740
(State or other jurisdiction (I.R.S. Employee
of incorporation or organization) Identification No.)
60 East 42nd Street, Suite 5010, New York, NY 10165
(Address of principal executive offices) (Zip Code)
Telephone Number (212) 716-2000
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirement for the past 90 days.
Yes X No
----- -----
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the close of the period covered by this report.
Class Outstanding at Jun. 26, 1999
- ------------------------------------- ----------------------------
Common shares, par value $1 per share 6,718,078
<PAGE>
Page 2
EDO CORPORATION
INDEX
Page No.
Face Sheet 1
Index 2
Part I Financial Information
Item 1. Financial Statements
Consolidated Balance Sheets -
June 26, 1999 and
December 31, 1998 3
Consolidated Statements of Earnings -
Three Months Ended
June 26, 1999 and
June 27, 1998 4
Consolidated Statements of Earnings -
Six Months Ended
June 26, 1999 and
June 27, 1998 5
Consolidated Statements of Cash Flows -
Six Months Ended
June 26, 1999 and
June 27, 1998 6
Notes to Consolidated Financial Statements 7-8
Item 2. Management's Discussion and Analysis
of Financial Condition and
Results of Operations 9-13
Part II Other Information 14
Signature 15
<PAGE>
Page 3
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
EDO Corporation and Subsidiaries
Consolidated Balance Sheets
(in thousands, except share and per share amounts)
Jun. 26, 1999 Dec. 31, 1998
Assets (unaudited)
Current assets:
Cash and cash equivalents $ 14,000 $ 21,801
Marketable securities 16,095 11,519
Accounts receivable, net 39,839 39,853
Inventories 12,568 9,830
Deferred tax asset, net 1,280 1,280
Prepayments and other current assets 2,748 2,177
--------- ---------
Total current assets 86,530 86,460
Property, plant and equipment, net 13,269 13,964
Notes receivable 1,875 2,300
Cost in excess of fair value of net
assets acquired, net 11,116 11,736
Other assets 13,169 12,293
--------- ---------
$ 125,959 $ 126,753
========= =========
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable and accrued liabilities $ 22,614 $ 24,427
Contract advances and deposits 18,808 14,538
Note payable - 5,460
Current portion of long-term debt 1,317 1,317
--------- ----------
Total current liabilities 42,739 45,742
Long-term debt 28,000 28,000
ESOT loan obligation 8,192 8,955
Postretirement obligation 3,443 3,443
Environmental obligation 2,467 2,562
Shareholders' equity:
Preferred shares, par value $1 per share
(liquidation preference $213.71 per share
or $12,459 in the aggregate in 1999),
authorized 500,000 shares, 58,299 issued
in 1999 and 60,641 in 1998) 58 61
Common shares, par value $1 per share,
authorized 25,000,000 shares, issued
8,453,902 in both periods 8,454 8,454
Additional paid-in capital 28,992 30,142
Retained earnings 37,336 35,294
--------- ---------
74,840 73,951
Less: Treasury shares at cost
(1,735,824 shares in 1999 and
1,821,634 shares in 1998) (24,561) (25,775)
ESOT loan obligation ( 8,192) ( 8,955)
Deferred compensation under
Long-Term Incentive Plan ( 969) ( 1,170)
--------- ---------
Total shareholders' equity 41,118 38,051
--------- ---------
$125,959 $126,753
========= =========
See accompanying Notes to Consolidated Financial Statements.
<PAGE>
Page 4
EDO Corporation and Subsidiaries
Consolidated Statements of Earnings
(in thousands, except per share amounts)
For the three months ended
Jun. 26, 1999 Jun. 27, 1998
(unaudited)
Net sales $ 27,768 $ 23,397
Costs and expenses
Cost of sales 20,347 16,608
Selling, general and administrative 4,242 3,596
Research and development 789 824
-------- --------
25,378 21,028
Operating earnings 2,390 2,369
Non-operating income (expense)
Interest income 397 482
Interest expense (592) (548)
Other, net - ( 25)
--------- ---------
(195) ( 91)
--------- ---------
Earnings before Federal income taxes 2,195 2,278
Federal income tax expense 665 -
--------- ---------
Net earnings 1,530 2,278
Dividends on preferred shares 249 263
--------- ---------
Net earnings available for common shares $ 1,281 $ 2,015
========= =========
Earnings per common share:
Basic $ 0.19 $ 0.31
========= =========
Diluted $ 0.17 $ 0.27
========= =========
Weighted average shares outstanding:
Basic 6,676 6,527
========= =========
Diluted 7,903 7,644
========= =========
See accompanying Notes to Consolidated Financial Statements.
<PAGE>
Page 5
EDO Corporation and Subsidiaries
Consolidated Statements of Earnings
(in thousands, except per share amounts)
For the six months ended
Jun. 26, 1999 Jun. 27, 1998
(unaudited)
Net sales $ 54,995 $ 46,698
Costs and expenses
Cost of sales 40,477 33,664
Selling, general and administrative 8,381 7,176
Research and development 1,525 1,546
-------- --------
50,383 42,386
Operating earnings 4,612 4,312
Non-operating income (expense)
Interest income 788 1,027
Interest expense (1,185) (1,106)
Other, net - ( 50)
--------- ---------
(397) (129)
--------- ---------
Earnings before Federal income taxes 4,215 4,183
Federal income tax expense 1,265 -
--------- ---------
Net earnings 2,950 4,183
Dividends on preferred shares 508 540
--------- ---------
Net earnings available for common shares $ 2,442 $ 3,643
========= =========
Earnings per common share:
Basic $ 0.37 $ 0.56
========= =========
Diluted $ 0.32 $ 0.49
========= =========
Weighted average shares outstanding:
Basic 6,660 6,488
========= =========
Diluted 7,948 7,608
========= =========
See accompanying Notes to Consolidated Financial Statements.
<PAGE>
Page 6
EDO Corporation and Subsidiaries
Consolidated Statements of Cash Flows
(in thousands)
For the six months ended
Jun. 26, 1999 Jun. 27, 1998
(unaudited)
Operating activities:
Net earnings $ 2,950 $ 4,183
Adjustments to net earnings to arrive at
cash provided (used) by operations:
Depreciation and amortization 3,007 2,135
Deferred compensation expense 201 202
Common shares issued for directors' fees 27 23
Changes in:
Accounts receivable 14 (4,740)
Inventories (2,738) (2,655)
Prepayments, other current assets
and other (1,247) 1,808
Accounts payable, accrued liabilities
and other (1,908) (1,390)
Contract advances and deposits 4,270 (2,461)
-------- --------
Cash provided (used) by operating activities 4,576 (2,895)
Investing activities:
Purchase of property, plant and equipment (1,466) (2,312)
Purchase of marketable securities (8,112) (6,030)
Sale or redemption of marketable securities 3,536 14,877
-------- --------
Cash (used) provided by investing activities (6,042) 6,535
Financing activities:
Proceeds from exercise of stock options 34 262
Payments received on notes receivable - 222
Payment made on note payable (5,460) -
Payment of common share cash dividends (401) (359)
Payment of preferred share cash dividends (508) (540)
-------- --------
Cash used by financing activities (6,335) (415)
Net (decrease) increase in cash and cash (7,801) 3,225
equivalents
Cash and cash equivalents at beginning
of year 21,801 20,351
-------- --------
Cash and cash equivalents at end of period $14,000 $23,576
======== ========
Supplemental disclosures:
Cash paid for: Interest $ 1,026 $ 1,057
Income taxes
(Federal, state and local) 800 1,278
See accompanying Notes to Consolidated Financial Statements.
<PAGE>
Page 7
Notes to Consolidated Financial Statements
Unaudited Consolidated Financial Statements
The accompanying unaudited, consolidated financial statements have been
prepared in accordance with instructions to Form 10-Q and, therefore, do not
include all information and footnotes normally included in consolidated
financial statements prepared in conformity with generally accepted accounting
principles. They should be read in conjunction with the consolidated financial
statements of EDO Corporation and subsidiaries (the "Company") for the fiscal
year ended December 31, 1998, filed by the Company on Form 10-K with the
Securities and Exchange Commission on March 17, 1999.
The accompanying consolidated financial statements are unaudited and include
all adjustments (consisting of normal recurring adjustments and accruals) that
management considers necessary for a fair presentation of its consolidated
financial position and results of operations for the interim periods presented.
The results of operations for the interim periods are not necessarily
indicative of the results that may be expected for the entire year.
Backlog Data
The dollar amount of backlog of firm orders at June 26, 1999 was $153,910,000
compared to $139,018,000 at June 27, 1998.
Inventories
Inventories are summarized by major classification as follows:
Jun. 26, 1999 Dec. 31, 1998
(in thousands)
Raw materials and supplies $ 4,970 $ 4,292
Work-in-process 7,195 5,262
Finished goods 403 276
------- -------
$ 12,568 $ 9,830
======= =======
Earnings Per Share
The following table sets forth the computation of basic and diluted earnings
per share:
Three months ended Six months ended
6/26/99 6/27/98 6/26/99 6/27/98
(in thousands) (in thousands)
Numerator:
Net earnings available
for common shares $ 1,281 $ 2,015 $ 2,442 $ 3,643
Impact of assumed conversion
of preferred shares 35 28 73 51
------ ------- ------- -------
Numerator for diluted
calculation $ 1,316 $ 2,043 $ 2,515 $ 3,694
======= ======= ======= =======
<PAGE>
Page 8
Denominator:
Weighted average common
shares outstanding 6,676 6,527 6,660 6,488
Dilutive effect of stock
options 50 187 60 190
Dilutive effect of conversion
of preferred shares 1,177 930 1,228 930
------ ------ ------ ------
Denominator for diluted
calculation 7,903 7,644 7,948 7,608
======= ======= ======= ======
Business Segments
The Company operates in two segments that have been organized by the products
and services they offer, as follows: Defense and Aerospace Systems and
Satellite Products. The Defense and Aerospace Systems segment sells its
products and services primarily to customers in the defense industry. The
Satellite Products segment sells its products to customers in the satellite
industry.
Principal products and services by segment are as follows:
Defense and Aerospace Systems Segment
Aircraft Stores Suspension and Release Equipment
Airborne Mine Countermeasures Systems
Command, Control and Communications Systems
Undersea Warfare Sonar
Technology and Analysis Services
Electro-Ceramic Products
Fiber Composite Products
Satellite Products Segment
Satellite Products
Three months ended Six months ended
6/26/99 6/27/98 6/26/99 6/27/98
(in thousands) (in thousands)
Net sales:
Defense and Aerospace Systems $ 23,661 $ 18,949 $ 46,683 $ 37,835
Satellite Products 4,107 4,448 8,312 8,863
------- ------- ------- -------
$ 27,768 $ 23,397 $ 54,995 $ 46,698
======= ======= ======= =======
Operating earnings (loss):
Defense and Aerospace Systems $ 2,271 $ 2,508 $ 4,345 $ 4,688
Satellite Products 119 (139) 267 (376)
------- ------- ------- -------
2,390 2,369 4,612 4,312
Interest expense, net 195 66 397 79
Other expense - 25 - 50
------- ------- ------- -------
Earnings before
Federal income taxes $ 2,195 $ 2,278 $ 4,215 $ 4,183
======= ======= ======= =======
<PAGE>
Page 9
Item 2.
Management's Discussion and Analysis
of Financial Condition and Results of Operations
Results of Operations
Three Months Ended June 26, 1999 compared with Three Months Ended June 27, 1998
Net sales for the second quarter of 1999 were $27.8 million compared with $23.4
million reported in the same period in 1998. The increase is attributable to
increased sales in the Defense and Aerospace Systems segment, partially offset
by a decrease in the Satellite Products segment.
Sales in the Defense and Aerospace Systems segment were $4.7 million greater
than the prior year quarter. Sales increases were recorded in airborne mine
countermeasures systems, command, control and communications systems,
technology services and analysis, and fiber composite products. These
increases were offset by a decrease in sales of electro-ceramic products
resulting from a delay in the receipt of orders. The increase in technology
services and analysis sales is attributable to the acquisition in July 1998, of
the assets of the Technology Services Group of Global Associates, Ltd., now
operating as EDO Technology Services and Analysis (EDO TSA). The net increase
in sales of fiber composite products resulted from the acquisition in December
1998, of Specialty Plastics, Inc., a manufacturer of lightweight fiber
composite pipe, now operating as EDO Specialty Plastics. This increase in
sales was partially offset by lower sales of fiber composite waste tanks due to
a reduction in orders. Sales in the Satellite Products segment were $0.3
million lower than the prior year quarter due to the winding down of certain
programs, partially offset by new programs.
Earnings from operations in the second quarter of 1999 were $2.4 million, the
same as the second quarter of 1998. Operating earnings and margin in the
Defense and Aerospace Systems segment were lower than the prior year quarter
due to lower relative margins of the recent aforementioned acquisitions and the
lower sales level of electro-ceramic products and fiber composite waste tanks.
Operating earnings and margin in the Satellite Products segment improved
compared to the second quarter of 1998 due to the mix of programs and the
resolution of technical issues on certain programs.
Selling, general and administrative expenses in the second quarter of 1999 were
$0.6 million higher than the second quarter of 1998. At 15.3 percent of sales,
the level of expenses is consistent with the prior year quarter.
Company-sponsored research and development expenditures of $0.8 million were
comparable to the corresponding period in 1998.
Non-operating expense, net, was $0.2 million in the second quarter of 1999,
compared with $0.1 million in the corresponding period of 1998. This increase
was principally due to lower interest income as a result of lower levels of
average invested cash.
The Company provided for Federal income taxes for the second quarter of 1999 at
an effective rate of 30%, which is currently the expected effective rate for
the full year 1999. The Company recorded a tax provision in the second quarter
of 1999 as it had previously fully recognized the benefit associated with its
tax net operating loss carryforward.
<PAGE>
Page 10
First Six Months of 1999 compared with First Six Months of 1998
Net sales for the first six months of 1999 were $55.0 million compared with
$46.7 million reported in the same period in 1998. The increase is
attributable to increased sales in the Defense and Aerospace Systems segment,
partially offset by a decrease in the Satellite Products segment.
Sales in the Defense and Aerospace Systems segment were $8.8 million greater
than the prior year period. Sales increases were recorded in aircraft stores
suspension and release equipment, command, control and communications systems,
technology services and analysis, and fiber composite products. These
increases were offset by a decrease in sales of electro-ceramic products
resulting from a delay in the receipt of orders. The increase in technology
services and analysis sales is attributable to the acquisition of EDO TSA. The
net increase in sales of fiber composite products resulted from the acquisition
of EDO Specialty Plastics. This increase in sales was partially offset by
lower sales of fiber composite waste tanks due to a reduction in orders. Sales
in the Satellite Products segment were $0.6 million lower than the prior year
period due to the winding down of certain programs, partially offset by new
programs.
Earnings from operations in the first six months of 1999 were $4.6 million
compared to $4.3 million in the first six months of 1998. Operating earnings
and margin in the Defense and Aerospace Systems segment were lower than the
prior year period due to lower relative margins of the recent aforementioned
acquisitions and the lower sales level of electro-ceramic products and fiber
composite waste tanks. Operating earnings and margin in the Satellite Products
segment improved compared to the first six months of 1998 due to the mix of
programs and the resolution of technical issues on certain programs.
Selling, general and administrative expenses in the first six months of 1999
were $1.2 million higher than the first six months of 1998. At 15.2 percent of
sales, the level of expenses is consistent with the prior year period.
Company-sponsored research and development expenditures of $1.5 million were
comparable to the corresponding period in 1998.
Non-operating expense, net, was $0.4 million in the first six months of 1999,
compared with $0.1 million in the corresponding period of 1998. This increase
was principally due to lower interest income as a result of lower levels of
average invested cash.
The Company provided for Federal income taxes for the first six months of 1999
at an effective rate of 30%, which is currently the expected effective rate for
the full year 1999. The Company recorded a tax provision in the first six
months of 1999 as it had previously fully recognized the benefit associated
with its tax net operating loss carryforward.
Financial Condition
The Company's cash, cash equivalents and marketable securities decreased by
$3.2 million from December 31, 1998 to $30.1 million at June 26, 1999. This
decrease was primarily due to the $5.5 million payment in January 1999 of the
note related to the acquisition of EDO Specialty Plastics, $1.5 million for
purchases of capital equipment and $0.9 million for payment of common and
preferred dividends, offset by cash from operating activities of $4.6 million.
In February 1999, the Company announced that it had retained an investment
banking firm to evaluate strategic alternatives regarding its Satellite
Products segment to determine how it best fits with the Company's long-term
growth plan. The alternatives include the possible sale of the business.
<PAGE>
Page 11
Inventories increased by $2.7 million from December 31, 1998, to $12.6 million
at June 26, 1999 primarily due to work-in-process attributable to timing
issues. The level of inventories is expected to decline by year-end.
The notes receivable of $3.2 million at June 26, 1999, of which $1.3 million is
included in current assets, relate to the sale of the Company's College Point
facility in January 1996. The notes are due in varying annual amounts through
2004 and bear interest at 7%. The payer of the note was in arrears as of June
26, 1999. However, in July 1999, the past due amounts were received by the
Company. The notes are fully secured by the related facility.
The Company has outstanding $29.3 million of 7% Convertible Subordinated
Debentures Due 2011. Commencing in 1996 and until retirement of these
debentures, the Company is making annual sinking fund payments of $1.8 million
which are due each December 15th. As of June 26, 1999, the Company had $0.4
million of these debentures remaining in treasury to be used for these annual
requirements. The remaining amount due in 1999 of $1.3 million is reflected in
the current portion of long-term debt. In July 1999, the Company purchased
$1.6 million face value of these debentures for $1.4 million. The Company,
therefore, now holds $2.0 million of these debentures, of which $1.8 million
will be used to satisfy the next sinking fund requirement on December 15, 1999.
The Company also has an ESOT loan obligation with a balance at June 26, 1999 of
$8.2 million at an interest rate of 82% of the prime lending rate. The
repayment of this obligation is funded through dividends on the Company's
preferred shares and cash contributions from the Company.
Capital expenditures in the first six months of 1999 totaled $1.5 million
compared with $2.3 million in the same period in 1998. The total expenditures
for 1999 are expected to be approximately the same level as the total $3.6
million in 1998.
The Company believes that it has adequate liquidity and sufficient capital to
fund its current operating plans.
The backlog of unfilled orders at June 26, 1999 was $153.9 million compared
with $139.0 million a year ago and $151.8 million at December 31, 1998.
New Accounting Standards
Statement of Financial Accounting Standards No. 133, as amended, establishes
standards for the accounting and reporting of derivative instruments and
hedging activities. This Statement, which is effective for all quarters of
fiscal years beginning after June 15, 2000, requires companies to record
derivatives on the balance sheet as assets or liabilities at their fair values.
In certain circumstances, changes in the values of such derivatives may be
required to be recorded as gains or losses. The Company believes that the
impact of this Statement will not have a material impact on its consolidated
financial statements.
Year 2000
The year 2000 issue ("Y2K") affects computer systems having date-sensitive
programs that may not properly recognize the year 2000. Y2K is reputed to be
able to cause computers and computer controlled equipment to cease functioning.
The Company has been addressing the Y2K issue for some time and established a
formal Y2K program in 1998.
The Company has conducted several informal and formal Y2K reviews over the last
two years of its products and internal systems. Based on these reviews, the
only area
<PAGE>
Page 12
where the Company has noted that Y2K could materially affect the Company's
operations or products is that failures or miscalculations could be caused in
the computerized accounting programs provided by outside vendors and used at
the Company. The applicable vendors have provided modifications to their
programs to deal with Y2K and these modifications are currently being tested.
This testing, which should be completed by the third quarter, has to date shown
these modifications to be mostly effective. If these modifications do not
prove to be entirely successful, the Company would be required to seek other
methods to process its accounting information.
The Company's formal Y2K program was established to ensure that the Company's
initial conclusions were correct. The program is conducted under the direction
of its Vice President & General Counsel and oversight of the Audit Committee of
the Board of Directors. The Y2K "Committee" consists of a Y2K coordinator from
each operating location and has met three times to date. The Committee will
meet formally three times over the next six months to review plans and to share
results of each of the Committee member's efforts.
The Company's Y2K program addresses Y2K from four perspectives:
* the Company looks at the products and services it sells to determine whether
Y2K will impact their performance;
* the Company looks at the materials, products and services it buys to
determine whether the suppliers of such materials, products and services or the
materials, products or services themselves will be impacted by Y2K in such a
way as to adversely impact the Company's operations;
* the Company looks at its interfaces with its customers and suppliers to
determine whether Y2K will adversely affect such interfaces; and
* the Company reviews its internal operations, including engineering,
manufacturing, finance and administrative (office and facilities equipment,
general purpose computers and related systems) to determine whether Y2K will
adversely affect any of these functions.
The formalized Y2K program encompasses three phases:
* Phase 1 established a baseline of Y2K compliance by a thorough review and
audit of each of the above four perspectives and determined readiness by
analysis and/or actual testing as necessary. This phase has been completed.
* Phase 2 determines a budget and actions necessary to bring into compliance
any areas determined to be either deficient, potentially deficient or in an
indeterminable state and a schedule for implementation completion. This phase
is essentially complete. To date, a budget of $250,000 has been established
for costs of those areas and actions identified. These costs are being
expensed as incurred.
* Phase 3 will verify by analysis and actual testing that any material Y2K
issues have been corrected and that all systems are Y2K compliant. This phase
is nearly complete. Contingency plans will also be established in the fourth
quarter, as necessary. Testing is nearly complete, and no material issues have
been identified.
Based upon the Company's review over the last two years and its testing and
findings to date, the Company does not believe that any costs associated with
Y2K will be material. However, if the modifications to accounting programs
provided by outside vendors, which to date have proven successful, do not
eventually prove entirely successful, the cost of replacing these programs
could have a material adverse effect. The Company presently expects that any
necessary remedial costs will be
<PAGE>
Page 13
expensed. As part of the Company's Y2K program, the Company is currently
seeking information regarding Y2K compliance from vendors, customers,
manufacturers and financial institutions associated with the Company. However,
given the reliance on third party information as it relates to their compliance
programs, no assurance can be given that the Company's information systems or
operations will not be affected by third party failures to complete their Y2K
projects on a timely basis.
"Safe Harbor" Statement Under the Private Securities Litigation Reform Act of
1995
The statements in this Quarterly Report on Form 10-Q and in oral statements
which may be made by representatives of the Company relating to plans,
strategies, economic performance and trends and other statements that are not
descriptions of historical facts may be forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995, Section 27(a)
of the Securities Act of 1933 and Section 21(e) of the Securities Exchange Act
of 1934. Forward-looking statements are inherently subject to risks and
uncertainties, and actual results could differ materially from those currently
anticipated due to a number of factors, which include, but are not limited to
the following for each of the types of information noted.
U.S. and international military program sales, follow-on procurement, contract
continuance, and future program awards, upgrades and spares support are subject
to:
U.S. and international military budget constraints and determinations;
U.S. congressional and international legislative body discretion;
U.S. and international government administration policies and priorities;
changing world military threats, strategies and missions;
competition from foreign manufacturers of platforms and equipment;
NATO country determinations regarding participation in common programs;
changes in U.S. and international government procurement timing,
strategies and practices; and
the general state of world military readiness and deployment.
Commercial satellite programs and equipment sales, follow-on procurement,
contract continuance and future program awards are subject to:
establishment and continuance of various consortiums for satellite
constellation programs;
delay in launch dates due to equipment, weather or other factors
beyond the control of the Company; and
development of sufficient customer base to support a particular
satellite constellation program.
Other commercial product sales are subject to:
success of product development programs currently underway or
planned;
competitiveness of current and future product production costs and
prices; and
market and customer base development for new product programs.
Achievement of margins on sales, earnings and cash flow can be affected by:
unanticipated technical problems; government termination of contracts for
convenience; decline in expected levels of revenues; underestimation of
anticipated costs on specific programs; risks inherent in integrating recent
acquisitions into the Company's overall structure; and risks associated with
year 2000 compliance by the Company, its customers, suppliers and other third
parties. Expectations of future Federal income tax rates can be affected by a
variety of factors, including amounts of profits relating to foreign sales.
The Company has no obligation to update any forward-looking statements.
<PAGE>
Page 14
PART II - OTHER INFORMATION
Item 5. Submissions of Matters to a Vote of Security Holders.
None.
Item 6. (a) Exhibits
27 - Financial Data Schedule
<PAGE>
Page 15
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
EDO Corporation
-----------------------------------------
(Registrant)
by: K. A. Paladino
-----------------------------------------
K. A. Paladino - Vice President Finance
and Treasurer
(Principal Financial Officer)
Date: August 6, 1999
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> JUN-26-1999
<CASH> 14,000
<SECURITIES> 16,095
<RECEIVABLES> 39,839
<ALLOWANCES> 0
<INVENTORY> 12,568
<CURRENT-ASSETS> 86,530
<PP&E> 54,741
<DEPRECIATION> 41,472
<TOTAL-ASSETS> 125,959
<CURRENT-LIABILITIES> 42,739
<BONDS> 36,192
<COMMON> 8,454
0
58
<OTHER-SE> 32,606
<TOTAL-LIABILITY-AND-EQUITY> 125,959
<SALES> 54,995
<TOTAL-REVENUES> 54,995
<CGS> 40,477
<TOTAL-COSTS> 50,383
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,185
<INCOME-PRETAX> 4,215
<INCOME-TAX> 1,265
<INCOME-CONTINUING> 2,442
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,442
<EPS-BASIC> .37
<EPS-DILUTED> .32
</TABLE>
