Teledyne Technologies Reports First Quarter Earnings

LOS ANGELES - April 27, 2000 - Teledyne Technologies Incorporated (NYSE: TDY) today reported first quarter 2000 sales of $203.5 million, compared with sales of $202.0 million for the same period in 1999. Net income was $10.2 million ($0.38 per diluted share) for the first quarter, compared with pro forma net income of $9.7 million ($0.35 per diluted share) for the first quarter of 1999.

Teledyne Technologies was spun off from Allegheny Teledyne Incorporated effective November 29, 1999. Pro forma adjustments in 1999 reflect the estimated expense impacts (primarily interest expense and corporate expenses) that would have been incurred had Teledyne Technologies operated as a separate company and as capitalized at the time of the spin-off for the 1999 period presented. Net income, before pro forma adjustments, was $11.9 million ($0.43 per diluted share) for the first quarter of 1999.

"As we complete our first full quarter as a public company, I am pleased to report that we met our earnings expectations for the quarter,'' said Robert Mehrabian, president and chief executive officer.

"We are pleased with our success in key commercial markets as well as our position in several important defense programs. Compared to last year, we experienced significant growth in airborne communication products, microwave power amplifiers, high frequency relays, electronic manufacturing services and piston engines for general aviation. In addition to growing our systems engineering, information technology and environmental businesses, we received a substantial production phase order from Lockheed Martin Corporation for cruise missile turbine engines. We are focusing more attention on leveraging our manufacturing skills to pursue opportunities in high growth markets such as wireless communications and fiber optics packaging."

The Electronics and Communications segment first quarter sales were $85.7 million, up 3.0 percent from 1999 first quarter sales of $83.2 million. First quarter operating profit rose 11.8 percent to $9.5 million, from $8.5 million in the first quarter of 1999.

First quarter sales, compared with the same period in 1999, grew significantly in electronic manufacturing services, relay products, business and commuter aircraft communications equipment and microwave products. Sales from electronic manufacturing services and microwave products grew as a result of new orders from both military and commercial customers. Relay products reported its strongest quarterly sales in over two years based on demand from the communications and semiconductor test equipment markets. Sales of medical and military microelectronics were down from the same period last year. Increased profitability resulted from increased revenue and operational improvements.

The Systems Engineering Solutions segment first quarter sales were $57.2 million, down 4.0 percent from 1999 first quarter sales of $59.6 million. Operating profit for the first quarter improved 14.3 percent to $5.6 million, from $4.9 million in the same period last year.

First quarter performance reflected strong sales growth and profitability improvements in systems engineering and integration, information technology, space programs, energy systems and environmental programs. The first quarter comparisons were negatively impacted by the significant decline in sales of marine products for the petroleum exploration market, which has been very weak since the second quarter of 1999. Operating results reflect a gain of approximately $1.4 million in the company's chemical weapon demilitarization business related to additional program funding, offset by a writedown of approximately $0.9 million in the company's process control software business.

The Aerospace Engines and Components segment first quarter sales were $60.6 million, up 2.4 percent from $59.2 million in 1999 first quarter. Operating profit declined by 13.8 percent to $7.5 million, from $8.7 million in the first quarter of 1999.

Sales and operating profit of piston engines for general aviation aircraft grew significantly, driven by strong sales of new engines to both OEMs and the aftermarket. The company is currently investigating a vendor related crankshaft issue involving approximately 1,100 engines. Teledyne Technologies has just begun field testing and continues to evaluate the matter. At this point, the company does not believe that it will have a material impact on earnings in 2000.

Sales and operating profit in the turbine engine business were down slightly due to reduced revenue from development phase work on new turbine engine programs. Sales of engines for the Harpoon missile and its derivatives continue to be strong, and during the quarter, the company reached an agreement with Lockheed Martin Corporation to supply turbine engines for the Joint Air-to-Surface Standoff Missile (JASSM) program.

Sales and operating profit from aerospace castings declined from the prior year due to market conditions, operational inefficiencies and a shift in product mix.

The financial information for the first quarter of 1999 before pro forma adjustments includes a corporate allocation from Teledyne Technologies' former parent company.

First quarter earnings before interest, taxes, depreciation and amortization (EBITDA) for 2000 were $23.1 million, compared with pro forma EBITDA of $21.7 million for the first quarter of 1999. Net pension income for the first quarter was $2.2 million, compared with net pension income of $1.6 million for the same period of 1999. Capital expenditures for the first quarter increased to $3.6 million, compared with $2.8 million for the first quarter in 1999.

This press release contains forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995, relating to earnings, growth opportunities, capital investments and strategic plans. Actual results could differ materially from these forward-looking statements. Many factors, including the extent and timing of the required public offering, market, economic and political conditions, and funding and continuation of government programs, as well as the outcome of the crankshaft investigation, could change the anticipated results. Additional information concerning factors that could cause actual results to differ materially from those projected in the forward-looking statements is contained in Teledyne Technologies' periodic filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K.

Teledyne Technologies is a leading provider of sophisticated electronics and communication products, systems engineering solutions and aerospace engines and components. Teledyne Technologies has operations in the United States, the United Kingdom and Mexico. For more information, visit Teledyne Technologies' website at http://www.teledyne.com.