Contact Information: Contact: Brian D. Keogh 425/453-9400
Esterline Reaches Agreement on Insurance Claim Related to Last Year's Explosion at UK Facility
Company to Receive $32 Million in Addition to Earlier Payments
| Source: Esterline Technologies
BELLEVUE, WA--(Marketwire - June 28, 2007) - Esterline Corporation (NYSE : ESL )
(www.esterline.com) today announced an agreement with its insurance carrier
to settle property damage and business interruption claims related to last
year's explosion at Esterline's UK-based countermeasure flares operation,
Wallop Defence Systems. The agreement calls for a payment to Wallop of
£16 million upon settlement. Including payments already received, the
total settlement is equal to £24 million, or approximately $48 million.
Robert W. Cremin, Esterline's chief executive officer, said he hopes the
settlement brings some closure for employees. He said, "
this has been a
trying time for all Wallop employees and passing this major milestone will
allow us to move forward with the rebuilding and, hopefully, healing
process."
The insurance recovery will be recorded in the company's fiscal third
quarter and is estimated to be $23 million net of tax, or $.87 per diluted
share. Cremin reiterated comments he made to investors in May, reminding
them that, "
we would much rather be shipping product than booking
insurance proceeds." Cremin said the settlement does not change the
fundamental outlook of the company. He said, "
our earnings guidance for
fiscal 2007 remains unchanged at $2.50 to $2.60 per share, plus the
incremental effect from the settlement."
Regarding plans to rebuild the damaged facility, Cremin said, "
we have
begun the formal process by submitting plans to appropriate jurisdictions.
We're working very closely with our principal customer and strategic
partner, the British Ministry of Defence, to provide current and future
countermeasure requirements. Our hope is to have a new facility fully
qualified and operational by the third or fourth quarter of fiscal '08."
About Esterline:
Esterline Corporation is a leading world-wide supplier to the aerospace and
defense industry specializing in three core areas: Avionics & Controls,
Sensors & Systems, and Advanced Materials.
Operations within the Avionics & Controls segment focus on technology
interface systems for commercial and military aircraft and similar devices
for land- and sea-based military vehicles, secure communications systems,
specialized medical equipment, and other high-end industrial applications.
The Sensors & Systems segment includes operations that produce
high-precision temperature and pressure sensors, electrical power
distribution equipment, and other related systems principally for aerospace
and defense customers. Operations within the Advanced Materials segment
focus on technologies including high-temperature resistant materials and
components used for a wide range of military and commercial aerospace
purposes and combustible ordnance and electronic warfare countermeasure
products.
This press release contains "forward-looking statements" within the meaning
of the Private Securities Litigation Reform Act of 1995. These statements
relate to future events or our future financial performance. In some cases,
you can identify forward-looking statements by terminology such as
"anticipate," "believe," "continue," "could," "estimate," "expect,"
"intend," "may," "might," "plan," "potential," "predict," "should" or
"will," or the negative of such terms, or other comparable terminology.
These forward-looking statements are only predictions based on the current
intent and expectations of the management of Esterline, are not guarantees
of future performance or actions, and involve risks and uncertainties that
are difficult to predict and may cause Esterline's or its industry's actual
results, performance or achievements to be materially different from any
future results, performance or achievements expressed or implied by the
forward-looking statements. Esterline's actual results and the timing and
outcome of events may differ materially from those expressed in or implied
by the forward-looking statements due to risks detailed in Esterline's
public filings with the Securities and Exchange Commission.