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Teledyne Technologies Annual Report, Year Ended Jan 1, 2006

Filing Date
Filed March 3, 2006
Period End
January 1, 2006
Security
TDY
In the record · 2016–202610-K1210-Q338-K120

TDY filed 12 annual reports (10-K), 33 quarterly reports (10-Q) and 120 current reports (8-K) between 2016 and 2026.

  1. Deal closed8-K · Jun ’17Jun ’17
  2. Material agreement8-K · Nov ’19Nov ’19
  3. Leadership change8-K · Jan ’22Jan ’22
  4. Leadership change8-K · Jan ’26Jan ’26

01—Abstract

Summary

Summary of the 10-K filed March 3, 2006. Cited figures are marked; the original filing is the authoritative source.

Teledyne Technologies Incorporated (NYSE: TDY) reported 2005 sales of $1,206.5 milliona, up from $1,016.6 million in 2004 and $840.7 million in 2003, and net income of $64.2 million, or $1.85 per diluted share, compared with $41.7 million ($1.24 per diluted share) in 2004.

Electronics and Communications was the largest segment at $717.8 millionb in sales and $84.0 million in operating profit, driven largely by acquisitions including Cougar Components, RD Instruments and the Celeritek defense electronics business. Acquisition-related revenue added $100.8 million to that segment's 2005 sales compared with 2004. U.S. Government sales were $510.6 million in 2005, about 42% of total sales, and the company's backlog of confirmed orders stood at $521.9 million at January 1, 2006.

The filing highlights significant exposure to government contracting risk, a pension plan that was underfunded at year-end 2005 (accrued pension obligation of $68.2 millionc), and a $38.9 million non-cash reduction to stockholders' equity under SFAS No. 87. Cash flow from continuing operations was $92.3 million, and total debt at year-end 2005 included $39.0 million under a $280.0 million credit facility, with $220.2 million of committed credit available. For 2006, management's outlook calls for full-year diluted earnings per share of approximately $1.85 to $1.90 on a GAAP basis, after roughly $0.10 per share of stock option expense and higher pension expense.

The company acquired Benthos, Inc. in January 2006 for approximately $40.6 milliond including stock option settlements, or $32.2 million net of cash acquired. Teledyne does not pay cash dividends and intends to retain earnings for growth.

02—Key points

Key Highlights

  1. Total sales rose to $1,206.5 million in 2005 from $1,016.6 million in 2004; net income increased to $64.2 million from $41.7 million.
  2. Electronics and Communications segment sales were $717.8 million, with segment operating profit of $84.0 million, up from $54.4 million in 2004.
  3. U.S. Government sales totaled $510.6 million in 2005, approximately 42% of total sales, and the filing notes exposure to congressional funding and contract termination risk.
  4. Backlog of confirmed orders was $521.9 million at January 1, 2006, with 99% expected to be fulfilled during 2006.
  5. Pension plan remained underfunded; the company expects 2006 SFAS No. 87 pension expense of approximately $16.4 million and cash contributions of approximately $18.8 million.
  6. 2006 GAAP diluted EPS outlook is $1.85 to $1.90, including approximately $0.10 per share of stock option expense under SFAS No. 123R.
  7. Acquired Benthos, Inc. in January 2006 for approximately $40.6 million including option settlements, funded primarily through the $280.0 million credit facility.

03—Questions

Frequently Asked Questions

  1. How much did Teledyne's sales and earnings grow in 2005?

    Sales increased to $1,206.5 million in 2005 from $1,016.6 million in 2004. Net income rose to $64.2 million, or $1.85 per diluted share, from $41.7 million, or $1.24 per diluted share, in 2004. The filing attributes the sales increase to growth in all four segments, with acquisitions contributing $100.8 million of incremental Electronics and Communications revenue.

  2. How dependent is Teledyne on U.S. Government business?

    Approximately 42% of 2005 total sales were derived from contracts with U.S. Government agencies and prime contractors, totaling $510.6 million, compared with 43% in 2004 and 46% in 2003. The Department of Defense represented 32% of total sales in 2005. The filing warns that government contracts depend on congressional appropriations and can be terminated for convenience, and that defense spending is expected to moderate over the next few years.

  3. What is the outlook for 2006 earnings?

    Management expects first-quarter 2006 earnings per share of approximately $0.43 to $0.46 and full-year 2006 GAAP diluted EPS of approximately $1.85 to $1.90. The outlook includes approximately $16.4 million of SFAS No. 87 pension expense and $5.4 million of stock option expense, and it assumes an effective tax rate of 37.6%. It excludes future acquisitions.

  4. What are the main financial obligations and liquidity sources?

    At year-end 2005, total debt included $39.0 million outstanding under a $280.0 million credit facility that expires in June 2009, leaving $220.2 million of available committed credit. Contractual obligations totaled $166.9 million, including $82.3 million of operating lease obligations. Cash and cash equivalents were $9.3 million, and net cash provided by continuing operations was $92.3 million in 2005. Planned 2006 capital expenditures are approximately $28.0 million.

04—Continue

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