What was the primary reason for filing an amendment (10-Q/A) to the quarterly report?

The primary reason for filing the amendment was to restate the company's basic and diluted earnings per share (EPS) and weighted-average shares outstanding calculations. This restatement was necessary to properly account for 'participating securities,' specifically vested stock options that include non-forfeitable rights to dividends, using the two-class method.

What is the impact of the EPS restatement on investors?

The restatement led to lower reported basic and diluted EPS compared to the originally reported figures for the period. For instance, basic EPS was restated to $0.75 from $0.81, and diluted EPS was restated to $0.75 from $0.78. While this reduces the per-share earnings figures, it provides a more accurate reflection of earnings allocation according to accounting standards, ensuring all participating securities are appropriately considered.

Did TransDigm Group make any significant acquisitions during this period?

Yes, TransDigm Group completed three significant acquisitions during the period: Aircraft Parts Corporation (APC) for approximately $67.4 million, the Unison Product Line for approximately $68.3 million, and CEF Industries, Inc. (CEF) for approximately $84.4 million. These acquisitions contributed to the increase in goodwill on the balance sheet.

Were there any issues with internal controls identified?

Yes, the company identified a material weakness related to the application of the two-class method in calculating basic and diluted EPS. This led to a conclusion that disclosure controls and procedures were not effective as of December 27, 2008. However, the company has since implemented a review process to address this issue and believes the material weakness has been remediated.

TDG 10-Q Quarterly Report Q1 FY2009 — Revenue, Net Income, EPS

Summary

TransDigm Group Inc. (TDG) filed an amendment to its Form 10-Q for the quarter ended December 27, 2008, primarily to restate its earnings per share (EPS) calculations. This restatement accounts for "participating securities" using the two-class method, impacting both basic and diluted EPS and weighted-average shares outstanding. The company has identified and remediated a material weakness in its disclosure controls related to this EPS calculation. Operationally, the company reported an increase in net sales to $181.3 million for the thirteen-week period ended December 27, 2008, up from $163.1 million in the prior year period. Net income also saw a significant increase, rising to $39.6 million from $27.0 million in the comparable period. This improvement was driven by strong operational performance and aided by a lower effective income tax rate due to the retroactive reinstatement of the research and development tax credit.

Key Highlights

1Restatement of EPS due to the adoption of the two-class method for participating securities (vested stock options).
2Net sales increased by approximately 11.1% to $181.3 million for the thirteen-week period ended December 27, 2008.
3Net income rose significantly to $39.6 million, a 46.9% increase compared to $27.0 million in the prior year period.
4Effective income tax rate decreased to 35.0% from 36.4% primarily due to the retroactive R&D tax credit.
5The company made a significant acquisition of Aircraft Parts Corporation (APC) for approximately $67.4 million.
6A material weakness in disclosure controls related to EPS calculation was identified and subsequently remediated.
7Goodwill increased substantially due to acquisitions, reaching $1.41 billion.

TransDigm Group INC Quarterly Report (Amendment) for Q1 Ended Dec 27, 2008

Summary

Key Highlights

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