<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
FORM 10-Q
/x/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For quarterly period ended July 31, 1997
----------------------------------------------------
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
-------------- ----------------
Commission file number 1-6357
--------------------------------------------------------
ESTERLINE TECHNOLOGIES CORPORATION
-----------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 13-2595091
- ---------------------------------------- ----------------------------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
10800 NE 8th Street, Bellevue, Washington 98004
------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 425/453-9400
------------
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 requirements for the past 90 days.
Yes X No
-------- --------
As of September 9, 1997, 8,624,539 shares of the issuer's common stock were
outstanding.
1
<PAGE>
PART 1 - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
- ------- --------------------
ESTERLINE TECHNOLOGIES CORPORATION
CONSOLIDATED BALANCE SHEET
As of July 31, 1997 and October 31, 1996
(In thousands, except share amounts)
July 31, October 31,
1997 1996
----------- -----------
ASSETS (unaudited)
- ------
Current Assets
Cash and equivalents $ 46,711 $ 46,436
Accounts receivable, net of allowances
of $2,777 and $4,084 for doubtful accounts 61,002 69,120
Inventories
Raw materials and purchased parts 18,777 15,880
Work in process 27,129 23,195
Finished goods 8,714 6,324
--------- ---------
54,620 45,399
--------- ---------
Deferred income taxes 14,921 15,321
Prepaid expenses 2,636 2,504
--------- ---------
Total Current Assets 179,890 178,780
--------- ---------
Property, Plant and Equipment 167,471 160,303
Accumulated depreciation 114,126 106,813
--------- ---------
53,345 53,490
--------- ---------
Intangibles, net and Other Assets 39,207 44,376
--------- ---------
$ 272,442 $ 276,646
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
- ------------------------------------
Current Liabilities
Accounts payable $ 17,780 $ 20,836
Accrued liabilities 59,912 68,492
Credit facilities 5,110 5,242
Current maturities of long-term debt 6,236 6,660
Federal and foreign income taxes 3,592 4,105
--------- ---------
Total Current Liabilities 92,630 105,335
--------- ---------
Long-Term Debt, net of current maturities 23,129 29,007
Shareholders' Equity
Common stock, par value $.20 per share,
authorized 30,000,000 shares, issued and
outstanding 8,624,539 and 8,501,668 shares 1,725 1,700
Capital in excess of par value 48,529 48,417
Retained earnings 110,972 93,686
Cumulative translation adjustment (4,543) (1,499)
--------- ---------
Total Shareholders' Equity 156,683 142,304
--------- ---------
$ 272,442 $ 276,646
========= =========
2
<PAGE>
ESTERLINE TECHNOLOGIES CORPORATION
CONSOLIDATED STATEMENT OF OPERATIONS
For the Three and Nine Months Ended July 31, 1997 and 1996
(Unaudited)
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
July 31, July 31,
--------------------- ----------------------
1997 1996 1997 1996
--------- -------- --------- ---------
<S> <C> <C> <C> <C>
Net Sales $ 102,068 $ 81,729 $ 282,217 $ 254,701
Costs and Expenses
Cost of sales 64,246 49,524 173,586 153,392
Selling, general and
administrative 27,251 24,264 81,442 77,805
Interest income (579) (772) (1,689) (1,636)
Interest expense 912 1,116 2,816 3,431
--------- -------- --------- ---------
91,830 74,132 256,155 232,992
--------- -------- --------- ---------
Earnings Before Income Taxes 10,238 7,597 26,062 21,709
Income Tax Expense 3,313 2,569 8,776 7,137
--------- -------- --------- ---------
Net Earnings $ 6,925 $ 5,028 $ 17,286 $ 14,572
========= ======== ========= =========
Net Earnings Per Share $ .79 $ .58 $ 1.97 $ 1.82
========= ======== ========= =========
</TABLE>
3
<PAGE>
ESTERLINE TECHNOLOGIES CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS
For the Nine Months Ended July 31, 1997 and 1996
(Unaudited)
(In thousands)
Nine Months Ended
July 31,
------------------------
1997 1996
--------- --------
Cash Flows Provided (Used) by Operating Activities
Net earnings $ 17,286 $ 14,572
Depreciation and amortization 12,577 12,166
Deferred income taxes 950 1,418
Working capital changes
Accounts receivable 5,738 6,412
Inventories (10,992) (7,146)
Prepaid expenses (244) (613)
Accounts payable (2,033) (3,432)
Accrued liabilities (7,703) (5,593)
Federal and foreign income taxes (512) (444)
Other, net 2,399 1,474
-------- --------
17,466 18,814
-------- --------
Cash Flows Provided (Used) by Investing Activities
Capital expenditures (12,336) (13,778)
Capital dispositions 2,235 796
-------- --------
(10,101) (12,982)
-------- --------
Cash Flows Provided (Used) by Financing Activities
Net change in credit facilities 560 2,262
Repayment of long-term debt (6,104) (6,668)
Net proceeds provided by sale of common stock -- 38,549
-------- --------
(5,544) 34,143
-------- --------
Effect of Exchange Rates (1,546) (508)
-------- --------
Net Increase in Cash and Equivalents 275 39,467
Cash and Equivalents - Beginning of Period 46,436 22,097
-------- --------
Cash and Equivalents - End of Period $ 46,711 $ 61,564
======== ========
Supplemental Cash Flow Information
Cash paid during the period for
Interest expense $ 3,516 $ 4,307
Income taxes 5,376 4,490
4
<PAGE>
ESTERLINE TECHNOLOGIES CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Three and Nine Months Ended July 31, 1997 and 1996
1. The consolidated balance sheet as of July 31, 1997 and the consolidated
statements of operations and cash flows for the three and nine months ended
July 31, 1997 and 1996 are unaudited, but in the opinion of management all
adjustments necessary to present fairly the financial statements referred
to above have been made. The results of operations and cash flows for the
interim periods presented are not necessarily indicative of results for the
full year.
2. The notes to the consolidated financial statements in the Company's 1996
Annual Report provide a summary of significant accounting policies and
additional financial information that should be read in conjunction with
this Form 10-Q.
5
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
- ------- ---------------------------------------------------------------
RESULTS OF OPERATIONS
---------------------
CERTAIN SECTIONS IN THIS FORM 10-Q CONTAIN FORWARD-LOOKING STATEMENTS WITHIN THE
MEANINGS OF SECTION 27A OF THE SECURITIES ACT OF 1933, AS AMENDED, AND SECTION
21E OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. SUCH STATEMENTS INVOLVE
RISKS AND UNCERTAINTIES REGARDING MATTERS THAT COULD SIGNIFICANTLY AFFECT
EXPECTED RESULTS INCLUDING INFORMATION ABOUT INDUSTRY TRENDS, GROWTH, ORDERS,
CAPITAL EXPENDITURES AND BACKLOG. THUS, ACTUAL RESULTS MAY VARY MATERIALLY FROM
THESE FORWARD-LOOKING STATEMENTS DEPENDING ON A VARIETY OF FACTORS WHICH
INCLUDE, BUT ARE NOT LIMITED TO, CHANGES IN THE TELECOMMUNICATIONS, COMPUTER,
AEROSPACE AND DEFENSE MARKETS; REDUCTIONS, TERMINATIONS OR CHANGES IN U.S.
GOVERNMENT DEFENSE BUDGET PRIORITIES; VARIABILITY OF CAPITAL EQUIPMENT MARKETS
AND OTHER RISKS WHICH ARE DETAILED IN OTHER COMPANY DOCUMENTS FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THE COMPANY DOES NOT UNDERTAKE ANY
OBLIGATION TO PUBLICLY RELEASE THE RESULTS OF ANY REVISIONS THAT MAY BE MADE TO
THESE FORWARD-LOOKING STATEMENTS TO REFLECT ANY FUTURE EVENTS OR CIRCUMSTANCES.
RESULTS OF OPERATIONS
- ---------------------
THREE MONTHS ENDED JULY 31, 1997 COMPARED WITH THREE MONTHS ENDED JULY 31, 1996
Net sales for the three months ended July 31, 1997 increased 25% to
$102.1 million compared with $81.7 million in the prior year period.
Net sales by Group were as follows:
(In thousands)
1997 1996
--------- --------
Automation $ 42,985 $ 32,642
Aerospace and Defense 32,974 27,006
Instrumentation 26,109 22,081
--------- --------
Total Net Sales $ 102,068 $ 81,729
========= ========
The Automation Group improvement was principally due to increased demand for the
Company's printed circuit board drilling equipment. Improvement in the
Company's Aerospace/Defense Group was due to the continued strengthening of
commercial aerospace markets and also reflected the addition of Mason Electric
Co. to the Group in August 1996. Instrumentation Group sales grew 18%, despite
the divestiture of Angus Electronics Co. in May 1997, reflecting both strong
sales to aerospace customers and improved demand for the Company's quality
control instrumentation.
Total gross margin as a percentage of net sales was 37% for the three months
ended July 31, 1997, lower by 2% from the prior year period. Group gross
margins ranged from 33% to 40% compared with the prior year period of 38% to
40%. For the three months ended July 31, 1997, the margin for one Group was
reduced largely as the result of increased pressure on prices. Selling, general
and administrative expenses for the three months ended July 31, 1997 increased
to $27.3 million, compared with $24.3 million during the same
6
<PAGE>
period in 1996. As a percentage of net sales, selling, general and
administrative expenses were 3% lower at 27% for the three months ended
July 31, 1997, when compared with 30% during the same period in 1996.
Interest income was $579,000 for the three months ended July 31, 1997, compared
with $772,000 during the same period in 1996. This reduction was attributable
to an overall decrease in cash as a result of acquisitions. Interest expense
was $912,000 for the three months ended July 31, 1997, compared with
$1.1 million during the same period in 1996, primarily due to a reduction of
principal in the outstanding 8.75% Senior Notes.
The effective income tax rate for the three months ended July 31, 1997 decreased
to 32%, compared with 34% for the same period in 1996, due primarily to state
tax credits that became available, partially offset by a lower proportion of
tax-exempt interest income.
New orders for the three months ended July 31, 1997 were $101.6 million,
compared with $79.7 million during the same period in 1996. The new order
increase was 27% for the three months ended July 31, 1997, principally due to
market improvements.
NINE MONTHS ENDED JULY 31, 1997 COMPARED WITH NINE MONTHS ENDED JULY 31, 1996
Net sales for the nine months ended July 31, 1997 increased 11% to
$282.2 million compared with $254.7 million in the prior year period.
Net sales by Group were as follows:
(In thousands)
1997 1996
--------- ---------
Automation $ 111,853 $ 113,883
Aerospace and Defense 97,114 72,796
Instrumentation 73,250 68,022
--------- ---------
Total Net Sales $ 282,217 $ 254,701
========= =========
Although sales for the Automation Group are slightly below the prior year, sales
of printed circuit board drilling equipment have increased over the last two
quarters and returned to levels experienced prior to the sharp decline that
started during the third quarter of 1996. Improvement in the Company's
Aerospace/Defense Group was primarily due to the continued strengthening of
commercial aerospace markets and the addition of Mason to the Group in
August 1996. Improvement in sales to aerospace customers was principally
responsible for the growth in Instrumentation Group sales, in spite of the
divestiture of Angus in May 1997.
Total gross margin as a percentage of net sales for the nine months of ended
July 31, 1997 was 39% compared with 40% in the first nine months of 1996. Group
gross margins ranged from 37% to 40% in the first nine months of 1997 compared
with 38% to 40% during the same period in 1996. Selling, general and
administrative expenses for the first nine months of 1997 increased to
$81.4 million, compared with $77.8 million in the same period in 1996. As a
percentage of net sales, selling, general and administrative expenses decreased
from 31% for the first nine months of 1996 to 29% during the same period in
1997.
7
<PAGE>
The effective income tax rate for the nine months ended July 31, 1997 was 34%,
an increase of 1% over the prior year period.
New orders for the nine months ended July 31, 1997 were $303.7 million, compared
with $264 million during the same period in 1996. Companywide, backlog at
July 31, 1997 was $148.8 million, compared with $112.5 million at July 31, 1996,
an increase of 32%. It is expected that $78.5 million in backlog will ship
after 1997. All orders are subject to cancellation until delivery.
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
Cash and equivalents on hand at July 31, 1997 totaled $46.7 million, an increase
of $275,000 from October 31, 1996. Net working capital increased $13.9 million
from $73.4 million at October 31, 1996 to $87.3 million at July 31, 1997. The
net increase in working capital was attributed primarily to increases in
inventory offset by decreases in accounts receivable, accounts payable and
accrued liabilities.
Capital expenditures, consisting of buildings, machinery, equipment and
computers, are anticipated to be $20 to $25 million during 1997, compared with
$17.2 million in 1996. Capital expenditures for the nine months ended
July 31, 1997 totaled $12.3 million and were primarily for enhancements to
information technology and additions to manufacturing capabilities in order to
support the growth and expansion of some of the Company's facilities.
Total debt decreased to $34.5 million at July 31, 1997 from $40.9 million at
October 31, 1996. Of the total debt outstanding at July 31, 1997,
$28.6 million was related to the Company's 8.75% Senior Notes and $5.9 million
was outstanding under various foreign currency debt agreements. There were no
borrowings outstanding under the Company's primary credit facility. An
annual principal repayment on the Senior Notes in the amount of $5.7 million
was made on July 30, 1997. The scheduled repayments will continue annually
until maturity on July 30, 2002.
8
<PAGE>
RECENT ACCOUNTING PRONOUNCEMENTS
- --------------------------------
In February 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 128, "Earnings per Share" which supersedes
APB Opinion 15 and will require the Company to report earnings per outstanding
share in addition to diluted earnings per share. Basic and diluted earnings per
share under the new standard are not expected to be materially different from
currently reported earnings per share for the Company. The standard becomes
effective for financial statements for both interim and annual periods ending
after December 15, 1997 and early application is not permitted.
In June 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 131, "Disclosures about Segments of an
Enterprise and Related Information". This statement establishes standards for
the way that public business enterprises report information about operating
segments in annual financial statements and requires that those enterprises
report selected information about operating segments in interim financial
reports issued to shareholders. This statement will not be effective for the
Company until the first quarter of fiscal 1999. At this time, it is not known
what the effect of this pronouncement will be on future disclosures made by the
Company.
9
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
- ------- -----------------
In October 1995, the Company identified irregularities in the allocation of
certain labor charges at its Armtec Defense Products ("Armtec") subsidiary and
participated in the Department of Defense ("DOD") Voluntary Disclosure Program.
On July 30, 1997, Armtec reached a negotiated settlement with the DOD for
$294,050, which was net of related amounts that the DOD agreed it owed to
Armtec. The Company's management believes that such settlement resolves all
outstanding issues for Armtec and the Company with respect to the matters that
were the subject of Armtec's participation in the Voluntary Disclosure Program.
In addition, the Company has various lawsuits and claims, both offensive and
defensive, and contingent liabilities arising from the conduct of business,
including those associated with government contracting activities, none of
which, in the opinion of management, is expected to have a material effect on
the Company's financial position or results of operations.
10
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
- ------- --------------------------------
(a) Exhibits.
Exhibit
Number Exhibit
------ -------
3.1 Composite Restated Certificate of Incorporation of the Company as
amended by Certificate of Amendment dated March 14, 1990.
(Incorporated by reference to Exhibit 19 to the Company's
Quarterly Report on Form 10-Q for the quarter ended
July 31, 1990.)
3.2 By-laws of the Company, as amended and restated December 15, 1988.
(Incorporated by reference to Exhibit 3.2 to the Company's
Annual Report on Form 10-K for the fiscal year ended
October 31, 1988.)
4.2 Form of Rights Agreement, dated as of December 9, 1992, between
the Company and Chemical Bank, which includes as Exhibit A
thereto the form of Certificate of Designation, Preferences and
Rights of Series A Serial Preferred Stock and as Exhibit B
thereto the form of Rights Certificate. (Incorporated by
reference to Exhibit 1 to the Company's Registration Statement on
Form 8-A filed December 17, 1992.)
10.1 Amendment of Lease and Agreement, dated March 11, 1959, between
the City of Torrance, California, and Longren Aircraft Company,
Inc., as original lessee; Lease, dated July 1, 1959, between the
City of Torrance and Aeronca Manufacturing Corporation, as
original lessee; and Assignment of Ground Lease, dated
September 26, 1985, from Robert G. Harris, as successor lessee
under the foregoing leases, to Excellon Industries, Inc.,
relating to principal manufacturing facility of Excellon at
24751 Crenshaw Boulevard, Torrance, California. (Incorporated by
reference to Exhibit 10.1 to the Company's Annual Report on Form
10-K for the fiscal year ended October 31, 1986.)
10.4 Industrial Lease dated July 17, 1984 between 901 Dexter
Associates and Korry Electronics Co., First Amendment to Lease
dated May 10, 1985, Second Amendment to Lease dated
June 20, 1986, Third Amendment to Lease dated September 1, 1987,
and Notification of Option Exercise dated January 7, 1991,
relating to the manufacturing facility of Korry Electronics at
901 Dexter Avenue N., Seattle, Washington. (Incorporated by
reference to Exhibit 10.4 to the Company's Annual Report on
Form 10-K for the fiscal year ended October 31, 1991.)
11
<PAGE>
Exhibit
Number Exhibit
------ -------
10.4a Fourth Amendment dated July 27, 1994 to Industrial Lease dated
July 17, 1984 between Houg Family Partnership, as successor to
901 Dexter Associates, and Korry Electronics Co. (Incorporated by
reference to Exhibit 10.4a to the Company's Annual Report on Form
10-K for the fiscal year ended October 31, 1994.)
10.5 Industrial Lease dated July 17, 1984 between 801 Dexter
Associates and Korry Electronics Co., First Amendment to Lease
dated May 10, 1985, Second Amendment to Lease dated June 20, 1986,
Third Amendment to Lease dated September 1, 1987, and
Notification of Option Exercise dated January 7, 1991, relating
to the manufacturing facility of Korry Electronics at 801 Dexter
Avenue N., Seattle, Washington. (Incorporated by reference to
Exhibit 10.5 to the Company's Annual Report on Form 10-K for the
fiscal year ended October 31, 1991.)
10.5a Fourth Amendment dated March 28, 1994 to Industrial Lease dated
July 17, 1984 between Michael Maloney and the Bancroft & Maloney
general partnership, as successor to 801 Dexter Associates, and
Korry Electronics Co. (Incorporated by reference to Exhibit 10.5a
to the Company's Annual Report on Form 10-K for the fiscal year
ended October 31, 1994.)
10.9 Note Agreement, dated as of July 15, 1992, among Esterline
Technologies Corporation, certain of its subsidiaries, The
Northwestern Mutual Life Insurance Company and New England Mutual
Life Insurance Company relating to 8.75% Senior Notes due
July 30, 2002 of Esterline Technologies Corporation and certain of
its subsidiaries. (Incorporated by reference to Exhibit 10.9 to
the Company's Quarterly Report on Form 10-Q for the quarter ended
July 31, 1992.)
10.9a Amendment to Note Agreement, executed as of October 31, 1993, to
that certain Note Agreement, dated and effective as of
July 15, 1992, among Esterline Technologies Corporation, certain
of its subsidiaries, The Northwestern Mutual Life Insurance
Company and New England Mutual Life Insurance Company relating to
8.75% Senior Notes due July 30, 2002 of Esterline Technologies
Corporation and certain of its subsidiaries. (Incorporated by
reference to Exhibit 10.9a to the Company's Annual Report on Form
10-K for the fiscal year ended October 31, 1993.)
12
<PAGE>
Exhibit
Number Exhibit
------ -------
10.10 Compensation of Directors. (Incorporated by reference to first
paragraph under "Other Information as to Directors" in the
definitive form of the Company's Proxy Statement, relating to its
1997 Annual Meeting of Shareholders held on March 5, 1997, filed
with the Securities and Exchange Commission and the New York
Stock Exchange on January 17, 1997.)
10.21 Credit Agreement executed and effective as of October 31, 1996
among Esterline Technologies Corporation and certain of its
subsidiaries, various financial institutions and Bank of America,
National Trust and Savings Association, as Agent. (Incorporated
by reference to Exhibit 10.21 to the Company's Annual Report on
Form 10-K for the fiscal year ended October 31, 1996.)
10.22 Real Property Lease and Sublease, dated June 28, 1996, between
810 Dexter L.L.C. and Korry Electronics Co. (Incorporated by
reference to Exhibit 10.22 to the Company's Annual Report on Form
10-K for the fiscal year ended October 31, 1996.)
10.23 Single Tenant Industrial Lease, dated April 1, 1994, between G&G
8th Street Partners, Ltd., James and Loralee Cassidy and Mason
Electric Company. (Incorporated by reference to Exhibit 10.23 to
the Company's Quarterly Report on Form 10-Q for the quarter ended
January 31, 1997.)
10.23a Single Tenant Industrial Sublease, dated August 1, 1996, between
Mason Electric Company, Inc. and ME Acquisition Co.
(Incorporated by reference to Exhibit 10.23 to the Company's
Quarterly Report on Form 10-Q for the quarter ended
January 31, 1997.)
10.23b Amendment of Lease, Estoppel, and Consent to Sublease, dated
August 6, 1996, between G&G 8th Street Partners, Ltd., Mason
Electric Company, Inc. and ME Acquisition Co. (Incorporated by
reference to Exhibit 10.23 to the Company's Quarterly Report on
Form 10-Q for the quarter ended January 31, 1997.)
11. Schedule setting forth computation of earnings per common share
for the three and nine months ended July 31, 1997 and 1996.
27. Financial Data Schedule (EDGAR only).
13
<PAGE>
Exhibit
Number Exhibit
------ -------
Management Contracts or Compensatory Plans or Arrangements
----------------------------------------------------------
10.13 Amended and Restated 1987 Stock Option Plan. (Incorporated by
reference to Exhibit 10.13 to the Company's Quarterly Report on
Form 10-Q for the quarter ended January 31, 1992.)
10.15 Esterline Corporation Supplemental Retirement Income Plan for Key
Executives. (Incorporated by reference to Exhibit 10.15 to the
Company's Annual Report on Form 10-K for the fiscal year ended
October 31, 1989.)
10.19 Executive Officer Termination Protection Agreement.
(Incorporated by reference to Exhibit 10.19 to the Company's
Annual Report on Form 10-K for the fiscal year ended
October 31, 1992.)
10.20c Esterline Technologies Corporation Corporate Management Incentive
Compensation Plan for Fiscal Year 1997. (Incorporated by
reference to Exhibit 10.20c to the Company's Annual Report on
Form 10-K for the fiscal year ended October 31, 1996.)
(b) Reports on Form 8-K.
No reports on Form 8-K were filed during the quarter for which this report is
filed.
14
<PAGE>
SIGNATURES
----------
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 hereunto duly authorized.
Esterline Technologies Corporation
(Registrant)
Date: September 12, 1997 By: /s/Robert W. Stevenson
---------------------------------------
Robert W. Stevenson
Executive Vice President,
Chief Financial Officer
and Secretary
(Principal Financial Officer)
By: /s/Robert D. George
---------------------------------------
Robert D. George
Treasurer and Controller
(Principal Accounting Officer)
15
<PAGE>
ESTERLINE TECHNOLOGIES CORPORATION
Quarterly Report on Form 10-Q
for the Three Months Ended July 31, 1997
INDEX TO EXHIBITS
-----------------
Exhibit Page
Number Exhibit Number
- ------ ------- ------
11. Schedule setting forth computation of earnings per common 17
share for the three and nine months ended July 31, 1997 and 1996.
27. Financial Data Schedule (EDGAR only).
16
<PAGE>
EXHIBIT 11
ESTERLINE TECHNOLOGIES CORPORATION
Computation of Earnings Per Common Share
For the Three and Nine Months Ended July 31, 1997 and 1996
(Unaudited)
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
July 31, July 31,
------------------- ------------------
1997 1996 1997 1996
--------- ------- -------- --------
<S> <C> <C> <C> <C>
PRIMARY BASIS
- -------------
Net Earnings $ 6,925 $ 5,028 $ 17,286 $ 14,572
======== ======= ======== ========
Average Number of Common Shares
Outstanding 8,575 8,483 8,541 7,747
Net Shares Assumed to be Issued
for Stock Options 233 241 243 254
-------- ------- -------- --------
Total average common shares
on a primary basis 8,808 8,724 8,784 8,001
======== ======= ======== ========
Net Earnings per Common
Share - Primary Basis $ .79 $ .58 $ 1.97 $ 1.82
======== ======= ======== ========
FULLY DILUTED BASIS
- -------------------
Net Earnings $ 6,925 $ 5,028 $ 17,286 $ 14,572
======== ======= ======== ========
Average Number of Common Shares
Outstanding 8,575 8,483 8,541 7,747
Net Shares Assumed to be Issued
for Stock Options 255 241 297 254
-------- ------- -------- --------
Total average common shares
on a fully diluted basis 8,830 8,724 8,838 8,001
======== ======= ======== ========
Net Earnings per Common
Share - Fully Diluted Basis $ .78 $ .58 $ 1.96 $ 1.82
======== ======= ======== ========
Net Earnings per Common
Share - Primary Basis $ .79 $ .58 $ 1.97 $ 1.82
======== ======= ======== ========
Dilutive Effect per Common Share $ (.01) $ None $ (.01) $ None
======== ======= ======== ========
</TABLE>
17
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
ESTERLINE TECHNOLOGIES CORPORATION CONSOLIDATED BALANCE SHEETS AT
JULY 31, 1997 AND THE RELATED CONSOLIDATED STATEMENTS OF OPERATIONS FOR
THE NINE MONTHS THEN ENDED AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> OCT-31-1997
<PERIOD-START> NOV-01-1996
<PERIOD-END> JUL-31-1997
<CASH> 46,711
<SECURITIES> 0
<RECEIVABLES> 63,779
<ALLOWANCES> 2,777
<INVENTORY> 54,620
<CURRENT-ASSETS> 179,890
<PP&E> 167,471
<DEPRECIATION> 114,126
<TOTAL-ASSETS> 272,442
<CURRENT-LIABILITIES> 92,630
<BONDS> 23,129
0
0
<COMMON> 1,725
<OTHER-SE> 154,958
<TOTAL-LIABILITY-AND-EQUITY> 272,442
<SALES> 282,217
<TOTAL-REVENUES> 282,217
<CGS> 173,586
<TOTAL-COSTS> 173,586
<OTHER-EXPENSES> 81,442
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,127
<INCOME-PRETAX> 26,062
<INCOME-TAX> 8,776
<INCOME-CONTINUING> 17,286
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 17,286
<EPS-PRIMARY> 1.97
<EPS-DILUTED> 1.96
</TABLE>
