Why is TransDigm filing an amendment to its 10-Q?

TransDigm is filing an amendment to its 10-Q for the quarter ended March 28, 2009, to restate its basic and diluted earnings per share (EPS) and weighted average shares outstanding calculations. This restatement is to properly account for participating securities, specifically vested stock options, using the two-class method of calculating EPS, rather than the previously used treasury stock method.

What impact did the acquisitions have on the company's financial statements?

The acquisitions of Aircraft Parts Corporation (APC), the Unison Product Line, and CEF Industries significantly increased TransDigm's goodwill, which rose to $1.4 billion. These acquisitions also contributed to the increase in total assets and influenced inventory levels. The company views these acquisitions as strengthening its position in niche aerospace markets with significant aftermarket content.

How did the restatement of EPS affect the reported earnings per share?

The restatement using the two-class method resulted in lower reported EPS compared to the original filing. For instance, for the thirteen-week period ended March 28, 2009, restated basic and diluted EPS were $0.77, compared to the originally reported basic EPS of $0.84 and diluted EPS of $0.80.

What is the company's outlook based on this filing?

While this filing primarily addresses a restatement and covers a period ending March 28, 2009, the company's commentary around acquisitions suggests a strategic focus on growth through acquiring businesses with strong aftermarket potential. The increase in net sales and net income for the period indicates a degree of operational strength despite the then-prevailing economic conditions.

TDG 10-Q Quarterly Report Q2 FY2009 — Revenue, Net Income, EPS

Summary

TransDigm Group Incorporated (TDG) filed an amendment to its Form 10-Q for the quarter ended March 28, 2009, primarily to restate its earnings per share (EPS) calculations. This restatement was due to the adoption of the two-class method for calculating EPS, which accounts for participating securities like vested stock options. For the thirteen-week period ending March 28, 2009, TransDigm reported net sales of $193.0 million, a notable increase from $175.3 million in the prior year. Net income also grew to $40.3 million from $32.2 million year-over-year. The company also highlighted significant acquisitions, including Aircraft Parts Corporation (APC) and the Unison Product Line, which are expected to contribute to future growth, particularly through aftermarket sales. Despite a challenging economic environment, the company demonstrated resilience with positive trends in sales and net income.

Key Highlights

1The filing is an amendment (10-Q/A) to correct the calculation of basic and diluted earnings per share using the two-class method, recognizing vested stock options as participating securities.
2Net sales for the thirteen weeks ended March 28, 2009, increased to $193.0 million from $175.3 million in the prior year period.
3Net income for the thirteen weeks ended March 28, 2009, rose to $40.3 million, compared to $32.2 million in the prior year.
4The company completed several acquisitions during the reporting period, including Aircraft Parts Corporation (APC) and the Unison Product Line, enhancing its product portfolio.
5Goodwill on the balance sheet significantly increased due to these acquisitions, reaching $1.4 billion.
6Total assets grew to $2.32 billion from $2.26 billion, driven by acquisitions and increased inventories.
7Long-term debt remained stable at approximately $1.36 billion, while total liabilities saw a slight increase.

TransDigm Group INC Quarterly Report (Amendment) for Q2 Ended Mar 28, 2009

Summary

Key Highlights

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