<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[_] Definitive Proxy Statement
[X] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
TELEDYNE, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[_] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
[_] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[X] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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Notes:
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FOR IMMEDIATE RELEASE Contact: Rosanne O'Brien
Teledyne, Inc.
310/551-4265
TELEDYNE REPORTS HIGHER SECOND QUARTER RESULTS--
SEVENTH CONSECUTIVE QUARTER OF EARNINGS GROWTH
Los Angeles, Calif., July 18, 1996 - Teledyne, Inc. (NYSE:TDY) announced
today that income for the second quarter ended June 30, 1996, increased 22
percent to $39.9 million, or $0.69 per common share, from $32.6 million, or
$0.59 per common share, for the second quarter of 1995. Sales from continuing
operations were $654.7 million for the second quarter of 1996 compared to $676.5
million for the same period of 1995.
"Teledyne reported another strong performance in the second quarter led by
our Specialty Metals Segment, with improved sales and margins in our Consumer
Segment," stated William P. Rutledge, Chairman and CEO and Donald B. Rice,
President and COO.
"Our seven consecutive quarters of increased profitability reflect the
successful execution of our business plans. Our outlook for Teledyne's
businesses remains positive, and we believe our strategic combination with
Allegheny Ludlum Corporation will provide even greater opportunities to enhance
shareholder value."
Income for the six months ended June 30, 1996, increased 17 percent to $77.6
million, or $1.35 per common share, from $66.6 million, or $1.19 per common
share, for the 1995 period excluding
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gains on sales of businesses. Including those gains in both years, net income
for the first six months of 1996 increased to $102.4 million, or $1.79 per
common share, compared to $96.9 million, or $1.74 per common share, for the 1995
period. After-tax gains were $24.8 million in 1996 from the sale of the
Company's defense vehicle business and $30.3 million in 1995 from the sale of
its defense electronics business. Sales from continuing operations increased to
$1.29 billion for the first six months of 1996 from $1.25 billion for the same
period of 1995.
As previously announced, Teledyne and Allegheny Ludlum have agreed to
combine. Under the agreement, each Company will become a wholly owned
subsidiary of the new company, Allegheny Teledyne Incorporated. Teledyne
shareholders will receive 1.925 shares of common stock in Allegheny Teledyne for
each of their Teledyne common shares. Allegheny Ludlum shareholders will
receive one share of common stock in the new company for each of their shares in
Allegheny Ludlum. Both companies will hold special shareholder meetings on
August 15, 1996 to vote on the proposed combination.
RESULTS OF OPERATIONS
- ---------------------
Specialty Metals
- ----------------
Sales increased to $269.7 million for the second quarter of 1996 from $226.1
million for the same period of 1995 and increased to $515.9 million for the
first half of 1996 from $450.1 million in the same period of 1995. Sales
significantly increased for titanium and nickel-based alloys and specialty
steels due to continued improvement in worldwide commercial aerospace and other
industrial markets, and for thin-rolled products due to new market
opportunities. Sales also
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increased significantly due to the acquisition in December 1995 of the European-
based Stellram Group, a manufacturer of high precision milling, boring and
drilling systems. Lower zirconium sales and decreased demand for forgings due
to softness in the truck market partially offset the sales increases.
Operating profit increased to $35.9 million for the second quarter of 1996
from $23.5 million for the same period of 1995 and increased to $66.2 million
for the first half of 1996 from $48.3 million for the 1995 period. Operating
profit increased for both periods of 1996 primarily due to higher sales and
improved margins particularly in titanium and nickel-based alloys. Margins also
significantly improved in zirconium and niobium alloys. The improvement in
operating profit was partially offset by lower margins on thin-rolled products.
Aviation and Electronics
- ------------------------
Sales from continuing operations decreased to $239.3 million for the second
quarter of 1996 from $317.8 million for the same period of 1995 and decreased to
$487.4 million for the first half of 1996 from $542.5 million in the same period
of 1995. Sales for 1996 would have increased over 1995 but for non-recurring
sales of $102 million in the second quarter of 1995 related to the completion of
a fixed price contract to develop and produce ground power generators for the
U.S. Air Force. Without the 1995 contract completion, 1996 sales would have
improved principally due to increased development work on the United States' new
High Altitude Endurance Unmanned Aerial Surveillance/Reconnaissance Vehicle
("Global Hawk"). Sales improvements for the 1996 second quarter and six months
also occurred
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in electronic devices and electromechanical relays for commercial customers, and
engineering services related to environmental cleanup of chemical munitions.
Lower sales of electronic countermeasure equipment for the international market,
and lower sales to the U.S. Government of fabricated products, airframe
structures, and other military unmanned aerial vehicles offset increased 1996
sales for the quarter and year.
Operating profit from continuing operations decreased to $21.9 million for
the second quarter of 1996 from $29.2 million for the same period of 1995 and
decreased to $47.3 million for the first half of 1996 from $57.7 million for the
1995 period. Operating profit declined primarily due to non-recurring income of
$6.1 million and $9.3 million for the second quarter and first half of 1995,
respectively, from the reversal of estimated losses on the ground power
generator contract. Results for the second quarter and six months of 1996 were
enhanced by strong performances of electronic devices and electromechanical
relays.
Consumer
- --------
Sales increased to $90.5 million for the second quarter of 1996 from $80.0
million for the same period of 1995 and increased to $172.8 million for the
first half of 1996 from $155.0 million in the same period of 1995. Sales
improved primarily due to the acquisitions of Jandy Industries, the major United
States producer of water flow control valves and electronic control systems for
the residential swimming pool industry, in May 1996, and Envases Comerciales,
S.A., a Costa Rican manufacturer of specialty packaging for pharmaceutical and
food companies, in December 1995. In
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addition, sales improved for the Teledyne Water Pik Pour-Thru Water Filter
device introduced in 1995.
Operating profit increased to $7.3 million in the second quarter of 1996 from
$3.9 million for the same period of 1995 and increased to $12.3 million for the
first half of 1996 from $6.6 million for the 1995 period. The increase in
operating profit was due primarily to the higher sales discussed above and lower
start-up costs incurred for new product introductions.
Industrial
- ----------
Sales from continuing operations increased to $55.2 million for the second
quarter of 1996 from $52.6 million for the same period of 1995 and increased to
$111.3 million for the first half of 1996 from $99.0 million for the 1995
period. Sales improved in both periods of 1996 primarily in metal stamping dies
and compression molds for the automotive and truck markets. In addition, sales
of nitrogen cylinder systems for the metal stamping industry and sales of
breaker systems for the construction and mining industries had strong
performances. The improvement in sales was partially offset by lower sales of
vehicle control valves to the trucking industry and material handling equipment.
Operating profit from continuing operations increased to $5.9 million for the
second quarter of 1996 from $5.5 million for the same period of 1995 and
increased to $11.0 million for the first half of 1996 from $10.9 million for the
1995 period. Increased profits from the sales increases discussed above were
offset by a decline in margins of material handling equipment.
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CORPORATE EXPENSE
Corporate expense increased to $22.4 million for the second quarter of 1996
from $20.9 million for the same period of 1995 primarily due to legal and
advisory costs associated with the pending combination with Allegheny Ludlum.
For the first half of 1996, corporate expense decreased to $40.5 million from
$43.4 million for the 1995 period due to a decline in costs related to
unsolicited merger proposals and ensuing proxy contests.
PENSION INCOME
Teledyne's pension income reflects the amount by which the amortization into
income of pension surplus and estimated return on plan assets exceeded the
current year's cost of providing benefits. Pension income before tax was $19.5
million in the second quarter of 1996 compared to $21.1 million for the same
period of 1995 and was $39.3 million for the first half of 1996 compared to
$42.2 million for the 1995 period. The decrease in pension income was a result
of reduced amortization of actuarial pension gains and a decrease in the
discount rate, to 7.5% from 8.5%, used to calculate the pension benefit
obligation, partially offset by a higher expected return on pension assets.
INCOME TAXES
The Company's lower effective tax rate for 1995 was the result of a $2.1
million reduction in 1995 of prior years' estimated tax liabilities not repeated
in 1996.
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Teledyne, Inc. is a federation of technology-based manufacturing businesses
serving worldwide customers with specialty metals for consumer, industrial and
aerospace applications; commercial and government-related aviation and
electronics products; and consumer and industrial products.
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<TABLE>
<CAPTION>
Teledyne, Inc. and Subsidiaries
(In millions)
Quarter Ended Six Months Ended
June 30, June 30,
--------------- ----------------
1996 1995 1996 1995
------ ------ ------- ------
<S> <C> <C> <C> <C>
Sales:
Specialty metals: $269.7 $226.1 $515.9 $450.1
------ ------ ------ ------
Aviation and electronics:
Continuing 239.3 317.8 487.4 542.5
Discontinued 6.8 8.4 14.4 18.8
------ ------ ------ ------
246.1 326.2 501.8 561.3
------ ------ ------ ------
Consumer: 90.5 80.0 172.8 155.0
------ ------ ------ ------
Industrial:
Continuing 55.2 52.6 111.3 99.0
Discontinued 1.3 21.8 29.7 66.8
------ ------ ------ ------
56.5 74.4 141.0 165.8
------ ------ ------ ------
Total:
Continuing 654.7 676.5 1,287.4 1,246.6
Discontinued 8.1 30.2 44.1 85.6
------ ------ ------- -------
$662.8 $706.7 $1,331.5 $1,332.2
====== ====== ======== ========
</TABLE>
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Teledyne, Inc. and Subsidiaries
(In millions except per share amounts)
<TABLE>
<CAPTION>
Quarter Ended Six Months Ended
June 30, June 30,
--------------- ----------------
Operating Profit (Loss): 1996 1995 1996 1995
------ ----- ---- ----
<S> <C> <C> <C> <C>
Specialty metals:
Continuing $35.9 $23.5 $66.2 $48.3
Pension income 0.7 2.6 2.7 5.2
------- ----- ----- -----
36.6 26.1 68.9 53.5
------- ----- ----- -----
Aviation and electronics:
Continuing 21.9 29.2 47.3 57.7
Discontinued (0.6) (1.6) (1.2) (2.4)
Pension income 3.9 4.5 8.3 9.0
------ ----- ----- -----
25.2 32.1 54.4 64.3
------ ----- ----- -----
Consumer:
Continuing 7.3 3.9 12.3 6.6
Pension income (0.2) 0.1 (0.2) 0.1
------ ----- ----- -----
7.1 4.0 12.1 6.7
------ ----- ----- -----
Industrial:
Continuing 5.9 5.5 11.0 10.9
Discontinued (0.3) (0.9) 0.1 (0.8)
Pension income 0.4 5.9 6.7 11.9
----- ----- ----- -----
6.0 10.5 17.8 22.0
----- ----- ----- -----
Total Continuing 71.0 62.1 136.8 123.5
Discontinued (0.9) (2.5) (1.1) (3.2)
----- ----- ----- -----
70.1 59.6 135.7 120.3
Corporate expense:
Salaries and benefits (5.9) (6.0) (10.4) (11.8)
Closed businesses' expenses (4.5) (3.4) (7.3) (4.5)
Other (12.0) (11.5) (22.8) (27.1)
Interest expense (10.3) (10.4) (21.1) (21.0)
Pension income 19.5 21.1 39.3 42.2
Other income 7.6 2.7 52.0 56.9
----- ----- ----- -----
Income Before Taxes 64.5 52.1 165.4 155.0
Provision for Taxes 24.6 19.5 63.0 58.1
----- ----- ----- -----
Net Income 39.9 32.6 102.4 96.9
Preferred Stock Dividends (1.3) (0.4) (2.0) (0.4)
----- ----- ----- -----
Net Income Applicable to Common Shareholders $ 38.6 $ 32.2 $100.4 $ 96.5
====== ====== ====== ======
Net Income Per Share $ 0.69 $ 0.59 $ 1.79 $ 1.74
====== ====== ====== ======
</TABLE>
Average shares - There were 56,016,608 and 55,938,099 shares of common stock
outstanding during the three and six months ended June 30, 1996, respectively,
and 55,627,166 and 55,563,892 for the three and six months ended June 30, 1995,
respectively.
Note - In March 1996, the Company sold its defense industrial vehicle business
at a pretax gain of $41.0 million, included in other income. Sales and operating
results for this operation and the Company's aviation and electronics wire and
cable business, which was sold in May 1996, have been reclassified and presented
in discontinued results. In January 1995, the Company sold substantially all of
its defense electronic systems business at a pretax gain of $50.7 million,
included in other income. Certain amounts for 1995 have been reclassified to
conform with the 1996 presentation.
July 18, 1996
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