Teledyne Technologies Incorporated
2006
Annual Report
Sales (in millions)
Diluted Earnings per Share
Operating Margin
$1,433
$1,207
$1,017
$ 841
$ 773
$2.26
$1.85
$1.24
$0.91
$0.77
8.7%
8.3%
6.6%
5.6%
16.7%
2002 2003 2004 2005 2006
30.9%
2002 2003 2004 2005 2006
2002 2003 2004 2005 2006
2 0 0 6 F I N A N C I A L H I G H L I G H T S
Selected Consolidated Financial Data
(In millions, except per-share data)
Summary Financial Information
Sales
Net income
2006
2005
2004
2003
2002
$ 1,433.2
$ 1,206.5
$ 1,016.6
$ 840.7
$ 772.7
$ 80.3
$ 64.2
$ 41.7
$ 29.7
$ 25.4
Diluted earnings per share
$ 2.26
$ 1.85
$ 1.24
$ 0.91
$ 0.77
Weighted average diluted common
shares outstanding
35.5
34.7
33.7
32.7
32.9
Summary Balance Sheet Data
Cash and cash equivalents
$ 13.0
$ 9.3
$ 11.4
$ 37.8
$ 19.0
2006
2005
2004
2003
2002
Working capital
Total assets
Long-term debt and
$ 216.4
$ 154.0
$ 124.4
$ 129.5
$ 102.6
$ 1,061.4 $ 728.2 $ 624.8
$ 433.6
$ 398.9
capital lease obligations
$ 230.7 $ 47.0 $ 74.4
$ —
$ —
Stockholders’ equity
$ 431.8
$ 326.0
$ 262.1
$ 221.0
$ 176.8
See “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the “Notes to
Consolidated Financial Statements” in this 2006 Annual Report on Form 10-K for additional information regarding
Teledyne Technologies Incorporated fi nancial data.
Teledyne Technologies Incorporated Annual Report
Page 1
Sales by Segment
OPERATIONS AT A GLANCE
2%
63%
20%
15%
Electronics and Communications
Systems Engineering Solutions
Aerospace Engines and Components
Energy Systems
Defense Electronics
Overview
Selected Products / Services
24%
Through our defense electronics businesses,
Teledyne provides a wide array of highly
specialized components, subsystems and
engineering resources to our government, as
well as to other defense contractors
(cid:129) Integrated microwave assemblies
(cid:129) Infrared and visible light imaging sensors
(cid:129) High-voltage connector assemblies
(cid:129) Government funded applied research
(cid:129) Defense electronics manufacturing services
Electronic Instrumentation
24%
Teledyne’s instruments detect trace contaminants
in air and water, help locate and retrieve new
energy reserves, are used in drug discovery and
assist with industrial process control applications
(cid:129) Ambient air monitoring instruments
(cid:129) Acoustic Doppler water current profi lers
(cid:129) Hydrophones and streamer cables
(cid:129) Continuous emissions monitoring systems
(cid:129) Subsea wet-mateable connectors
(cid:129) Flash chromatography systems
Other Commercial Electronics
Our aircraft information management solutions are
designed to increase the reliability and effi ciency
of aircraft transportation. In addition, alongside
our defense electronics, we produce precision
electronics for other markets, including implantable
medical devices, commercial aviation and wireless
communication
15%
(cid:129) Wireless aircraft data acquisition systems
(cid:129) Electromechanical relays and coaxial switches
(cid:129) Tranceivers for cellular infrastructure
(cid:129) Medical device electronics manufacturing
Systems Engineering Solutions and Energy Systems
2%
20%
Our government engineering services are focused
on protecting the United States, expanding national
interests in space, and improving environmental
safety. We also provide long-life power systems
for government applications, as well as high purity
hydrogen gas generation systems
(cid:129) Missile defense systems engineering
(cid:129) Space hardware and engineering services
(cid:129) Chemical weapons demilitarization services
(cid:129) Power systems for deep space probes
(cid:129) Hydrogen gas generators
Aerospace Engines and Components
In business for over 100 years, Teledyne
Continental Motors currently provides piston
engines for a number of today’s most popular
general aviation aircraft, including models from
Cirrus, Raytheon, Columbia and Liberty
(cid:129) Aircraft piston engines and spare parts
(cid:129) Small turbine engines for military applications
(cid:129) Gill brand general aviation batteries
(cid:129) Digital electronic engine control systems
15%
To Our Stockholders
Robert Mehrabian
Chairman, President and
Chief Executive Offi cer
In 2006, Teledyne achieved a number of milestones:
• Sales increased 18.8% to over $1.43 billion, from
approximately $1.21 billion in 2005
• Earnings per share increased 22.2% to $2.26 compared
to $1.85 in 2005
• Market value of Teledyne’s common stock increased
37.9% from year-end 2005 to year-end 2006
• We closed fi ve acquisitions, including our largest to date
For the last fi ve years, we have been successfully executing a strategy
to strengthen our core businesses, improve operational effi ciency and
grow both organically and by acquisition. We have focused primarily
on two of our core markets, defense electronics and instrumentation,
both of which require specialized technology and have high barriers to
entry. Teledyne is now a much stronger competitor in each of those
markets, with a much greater breadth and depth of products, and the
ability to provide integrated solutions to our customers.
As a result of this focused strategy and our continuous emphasis on
operational excellence, our sales have grown by about 85% from $773
million in 2002 to over $1.43 billion in 2006, or at a compound
annual growth rate of 16.7%. Over the same timeframe, our earnings
per share have improved from $0.77 to $2.26, or at a compound
annual growth rate of over 30.9%. Our operating margin has increased
318 basis points since 2002 due to a combination of improved
Teledyne Technologies Incorporated Annual Report
Page 3
operational performance and the acquisition of complementary higher-
margin product lines in our core markets.
In 2006, we continued our strong financial performance and made
fi ve acquisitions, including our largest and most strategic to date, the
Cumulative Total Stockholder Return
The graph set forth below shows the cumulative
total stockholder return (i.e., price change plus
reinvestment of dividends) on our common stock
from our fiscal year end December 30, 2001 through
our fiscal year end December 31, 2006, as
compared to the Standard & Poor’s 500 Composite
Index, the Russell 2000 Index and the Dow Jones
World Aerospace & Defense Index.
The graph assumes that $100 was invested on
December 28, 2001.
In accordance with the rules of the Securities
and Exchange Commission, this presentation is not
incorporated by reference into any of our registra-
tion statements under the Securities Act of 1933.
250
200
150
100
50
Rockwell Scientifi c Company.
Th is acquisition provides Teledyne
a greatly expanded base of
technology and highly-skilled
scientists and engineers, enabling
us to accelerate the pace of product
development in our current
markets and giving us the resources
to become a signifi cant competitor
in adjacent markets.
Gaining Scale
Our strategy for making Teledyne
Technologies a stronger, more
competitive corporation has
evolved progressively. Early on,
we focused on manufacturing,
updating our factories and
12/30/01
12/29/02
12/28/03
01/02/05
01/01/06
12/31/06
training our workforce in lean
12/30/01
12/29/02
12/28/03
01/02/05
01/01/06
12/31/06
Teledyne Technologies
100
91
117
177
175
242
Dow Jones World
Aerospace & Defense
Russell 2000
S&P 500 Composite
100
100
100
87
79
77
112
115
98
136
137
110
165
143
115
204
170
134
manufacturing techniques that
both reduce defects and improve
manufacturing cycle times. By
continually reducing the cost
of rework, scrap and warranty
expense, we have not only improved our operating margins, but have
also enhanced our reputation as a high-quality supplier with the
fl exibility to respond quickly to the changing needs of our customers.
Teledyne Technologies Incorporated Annual Report
Page 4
Eyes Wide Open
Teledyne’s high performance infrared and
visible light imaging sensors have been
selected for the most demanding appli-
cations including the new James Webb
Space Telescope, and very high resolution
military surveillance applications.
Illustration courtesy of Northrop Grumman Corporation
Monitoring
the Environment
Teledyne RD Instruments
provides highly sensitive ocean
and inland waterway current
measurement devices. Th ese
instruments are used for a
number of applications,
including monitoring the
health of river deltas and
assisting in tsunami detection.
Th e next step in our strategy was to build a stronger position in our
core markets by acquiring attractive businesses with products that were
complementary to our existing lines. Since our fi rst acquisition of an
environmental instrumentation business in 2001, we have acquired 14
additional defense electronics and instrumentation businesses.
Our defense electronics revenues have grown from approximately
$110 million in 2001, to a run-rate of approximately $400 million
at year-end 2006. We have acquired seven defense electronics
companies, bringing us an ever-broader range of specialized
products. Such products include traveling wave tubes, solid-state
microwave components and subsystems, very high-speed mixed signal
semiconductors, electromechanical and solid-state relays, high voltage
connectors and cables, and infrared and visible light focal plane arrays.
With the new capabilities gained through our acquisitions, fi ve of
which had expertise in specialized defense microwave technologies, we
are now one of a very limited number of companies that are able to
develop highly integrated microwave assemblies that combine multiple
functions into a single unit. During 2006, we delivered prototypes
of several new integrated assemblies, including a broadband data link
for an unmanned aerial vehicle and frequency converters for four new
customers for military satellite communications systems. Noting that
Teledyne is a key supplier to the Air Force for aircraft such as the F-15,
F-16, B-52 and C-130, the Air Force Materials Command awarded a
Teledyne company a ten year contract worth up to $370 million for
parts and assemblies. Teledyne is also a signifi cant supplier to many
defense industry prime contractors. During 2006, one of our fi rst tier
customers reduced its supplier base for outsourced manufacturing and
chose all three relevant Teledyne business units as approved suppliers.
Teledyne Technologies Incorporated Annual Report
Page 7
Our instrumentation revenues have also grown signifi cantly, from $45
million in 2001 to approximately $350 million in 2006. Starting with
a base in industrial gas analysis, we acquired fi ve companies that added
closely-related products, fi rst in environmental gas analysis, then in
laboratory organic and inorganic pollution analysis, and subsequently
in instrumentation for wastewater collection and fl ow measurement.
In 2005, we embarked on a signifi cant expansion in the marine
instrumentation market with the acquisition of RD Instruments,
Inc., a company which applies acoustic Doppler technology to the
measurement of the speed of ocean and river currents and the speed
of surface and underwater vehicles. Th is product line was very
complementary to Teledyne’s existing geophysical instrumentation
business, which manufactures arrays of acoustic sensors, or
hydrophones, used in off shore oil and gas exploration. Next, in January
of 2006, we acquired Benthos, Inc., a manufacturer of hydrophones,
underwater acoustic communication equipment, sonar systems and
remotely operated vehicles.
In August of 2006, we acquired a majority interest in Ocean Design, Inc.
(ODI), a leading manufacturer of subsea interconnect systems. ODI’s
largest market is off shore oil and gas production where its unique wet-
mateable electrical and fi ber-optic connectors and cables are installed at
wellheads on the ocean bottom by remotely operated vehicles.
During 2006, all of our marine instrumentation businesses experienced
strong demand for products for off shore oil and gas exploration and
production. New orders at Ocean Design continued at a record pace
subsequent to the acquisition, resulting in signifi cant growth in year-end
backlog. Th e growth in off shore production also enhanced sales of our
Acoustic Doppler Current Profi lers, which the Department of Interior
mandates for safety on mobile off shore drilling units operating in the
Teledyne Technologies Incorporated Annual Report
Page 8
Discovering Resources
During off shore oil and gas
exploration, hydrophones from
Teledyne Benthos and streamer
cables from Teledyne Geophysical
Instruments help fi nd new
energy reserves.
ODI connectors deliver electrical
power to subsea oil production
systems, as well as transmit sensor
data from the well to the rig.
Return to Space
Teledyne Brown Engineering captured
NASA’s highest honor for excellence and
quality in 2006 - Th e George M. Low
Award. Presented by NASA annually, the
Low Award is bestowed upon a contrac-
tor that has demonstrated excellence and
outstanding technical and managerial
achievements in quality and performance.
Illustration courtesy of NASA
Gulf of Mexico. To accommodate the strong demand for our fl uid-free
hydrophone streamer arrays, we increased manufacturing capacity at
our operations in Houston, Texas and Gloucester, England and added a
repair facility in Singapore to support the Asian market.
Today, the combined revenue run-rate of our marine instrumentation
businesses represents over 40% of our overall instrumentation sales.
All four business units serve three of the primary segments of the
undersea market: petroleum exploration, oceanography and defense.
Th is provides both strong brand recognition for Teledyne Marine
Instruments businesses and the opportunity for joint product
development.
Greater Technical Strength and a New Base in Imaging
Th e next step in the evolution of Teledyne’s capabilities is exemplifi ed
by the acquisition in September of Rockwell Scientifi c Company LLC,
now known as Teledyne Scientifi c & Imaging, LLC. For over four
decades Rockwell Scientifi c Company was a premiere research and
development organization, serving the critical future technology needs
of the Department of Defense, NASA, and several major companies.
It also has a long track record of transitioning cutting-edge technology
into successful products and businesses.
Teledyne Scientifi c & Imaging has a collection of innovative
technology and intellectual property. Th ese technologies are a valuable
source for building new, high-margin products and enhancing the
performance of existing Teledyne products. A few examples of many
technologies that are closely related to Teledyne’s core businesses
include millimeter-wave semiconductors and very high-speed signal
processing devices that are expected to enhance our integrated
microwave products, advanced materials with applications such as
marine instrumentation and turbine engines, optical devices for
Teledyne Technologies Incorporated Annual Report
Page 11
military fi ber optic communication systems and software algorithms
for autonomous vehicle systems.
Th e acquisition of Rockwell Scientifi c Company also provides us an
important foothold in high performance infrared and visible imaging
for astronomy, space surveillance and battlefi eld applications. Th e
imaging sensors business has already made a successful transition
from research to production, and like other Teledyne defense
electronics business units, provides highly-engineered components and
subsystems. We believe that Teledyne Imaging Sensors, with a state-of-
the-art manufacturing facility, will benefi t from Teledyne’s corporate-
wide focus on operational excellence as well as our extensive channels
to defense industry prime contractors. Th e infrared and visible light
sensors complement our existing analog, digital, microwave and
optoelectronic products, allowing us to be the supplier of choice for
very diversifi ed products to our key customers.
Looking Ahead
Our strong fi nancial performance since 2002 is a credit to the
performance and quality of our products and the hard work of our
skilled employees.
I believe that Teledyne Technologies will continue to grow and prosper
by building on our strategy of focusing on technologically-demanding
regulated niche markets, working relentlessly to reduce cost and cycle
time in our operations and achieving critical mass in our core markets
via complementary acquisitions.
While we have become a superior player in our niche markets,
we are now more aggressively seeking ways to expand the size of
our addressable markets, but without reaching beyond our core
competencies or losing management focus.
Teledyne Technologies Incorporated Annual Report
Page 12
System Engineering Strength
CollaborX became part of
Teledyne Brown Engineering this
year, adding new customers and
allowing us to support systems
from concept development to
sustainment and support.
Photo courtesy of the Department of Defense
Flying High
For over 75 years, Teledyne Continental
Motors has been a leader in reciprocating
engines for general aviation. Innovations
like our PowerLinkTM electronic engine
control and maintenance system continue
to advance engine technology for modern
general aviation aircraft, such as the twin
turbocharged Adam A500.
As we continue to grow and to expand into adjacent markets, the
perceptive advice and counsel provided by the broad spectrum of
industry leaders who constitute our board of directors will be ever
more valuable. Our board, which has been a critical factor in Teledyne’s
success to date, was further strengthened in 2006 by the addition of
Kenneth C. Dahlberg, chairman and CEO of Science Applications
International Corporation (SAIC), Wesley W. von Schack, chairman,
president and CEO of Energy East Corporation, and Roxanne S.
Austin, former president and chief operating offi cer of DIRECTV, who
bring to us extensive experience in markets that are important to the
future of Teledyne.
Chairman, President and Chief Executive Offi cer,
Teledyne Technologies Incorporated
February 28, 2007
Teledyne Technologies Incorporated Annual Report
Page 15
Executive Management
Left to right
DALE A. SCHNITTJER*
Senior Vice President and
Chief Financial Offi cer
IVARS R. BLUKIS
Chief Business Risk
Assurance Offi cer
ALDO PICHELLI*
Senior Vice President and
Chief Operating Offi cer, Electronics
and Communications Segment
JASON VANWEES
Vice President,
Corporate Development
and Investor Relations
JOHN T. KUELBS*
Executive Vice President,
General Counsel and Secretary
ROBERT MEHRABIAN*
Chairman, President and
Chief Executive Offi cer
SUSAN L. MAIN*
Vice President and Controller
ROBERT W. STEENBERGE
Vice President,
Chief Technology Offi cer
ROBERT L. SCHAEFER
Associate General Counsel,
Electronics and Communica-
tions General Counsel and
Assistant Secretary
SHELLEY D. GREEN
Treasurer
MELANIE S. CIBIK
Vice President, Associate
General Counsel and
Assistant Secretary
ROBYN E. MCGOWAN
Vice President of Administra-
tion, Human Resources and
Assistant Secretary
KEVIN J. RILEY
President, Teledyne
Scientifi c & Imaging, LLC
* Section 16 Offi cer
Teledyne Technologies Incorporated Annual Report
Page 16
Segment Executives
Stockholder Information
BRYAN L. LEWIS
President,
Aerospace Engines and
Components Segment
JAMES M. LINK
President,
Systems Engineering
Solutions Segment
ALDO PICHELLI
Senior Vice President
and Chief Operating Offi cer,
Electronics and
Communications Segment
RHETT C. ROSS
President,
Energy Systems Segment
CORPORATE OFFICES
Teledyne Technologies Incorporated
1049 Camino Dos Rios
Thousand Oaks, CA 91360
Telephone: (805) 373-4545
Fax: (805) 373-4775
www.teledyne.com
TRANSFER AGENT AND REGISTRAR
Mellon Investor Services LLC
P.O. Box 3315
South Hackensack, NJ 07606
(800) 356-2017
STOCKHOLDER PUBLICATIONS - FORM 10-K
Annual reports (including Form 10-K) and
proxy statements are mailed to all
stockholders of record. Copies of our SEC
periodic reports, corporate governance
guidelines, code of ethics and committee
charters are also available on our web site
at www.teledyne.com. For additional
information, contact Corporate
Communications or Investor Relations.
STOCK EXCHANGE LISTING
The common stock of Teledyne Technologies
Incorporated is traded on the New York Stock
Exchange (symbol TDY).
ANNUAL MEETING
The annual meeting of stockholders
will be held on Wednesday, April 25, 2007,
at 9:00 a.m., at Teledyne Technologies
Incorporated, 1049 Camino Dos Rios,
Thousand Oaks, CA 91360.
INDEPENDENT AUDITORS
Ernst & Young LLP
Los Angeles, California
CURRENT NEWS AND GENERAL INFORMATION
Information about Teledyne is
available at www.teledyne.com.
Teledyne Technologies Incorporated Annual Report
Page 17
Directors
ROXANNE S. AUSTIN (1)(2)
Former President and
Chief Operating Offi cer
DIRECTV, Inc.
ROBERT P. BOZZONE (1)(3)
Former Chairman,
Allegheny Technologies
Incorporated
FRANK V. CAHOUET (1)(2)
Retired Chairman and Chief
Executive Offi cer, Mellon
Financial Corporation
CHARLES CROCKER (2)(3)
Chairman, Crocker
Capital and Retired
Chairman and CEO,
BEI Technologies, Inc.
MICHAEL T. SMITH (2)(3)
Retired Chairman and Chief
Executive Offi cer, Hughes
Electronics Corporation
WESLEY W. VON SCHACK (2)(3)
Chairman, President and
Chief Executive Offi cer
Energy East Corporation
(1) Audit Committee
(2) Nominating and Governance Committee
(3) Personnel and Compensation Committee
KENNETH C. DAHLBERG (1)(3)
Chairman of the Board
and CEO of Science
Applications International
Corporation (SAIC)
SIMON M. LORNE (1)(2)
Vice Chairman and Chief
Legal Offi cer
Millennium Partners, L.P.
ROBERT MEHRABIAN
Chairman, President and
Chief Executive Offi cer,
Teledyne Technologies
Incorporated
PAUL D. MILLER (1)(2)
Retired Chairman, Alliant
Techsystems, Inc.
Forward-Looking Statements Cautionary Notice
Th is annual report contains forward-
looking statements as defi ned in
the Private Securities Litigation
Reform Act of 1995, relating to
earnings, growth opportunities,
capital expenditures, pension matters,
stock option expense and strategic
plans. Actual results could diff er
materially from these forward-looking
statements. Many factors, including
changes in demand for products
sold to the defense electronics,
instrumentation, energy exploration
and production, commercial aviation,
semiconductor, and communications
markets, funding, continuation and
award of government programs,
continued liquidity of our customers
(including commercial aviation
customers) and economic and
political conditions, could change the
anticipated results. In addition, stock
market fl uctuations aff ect the value of
the Company’s pension assets.
Global responses to terrorism
and other perceived threats increase
uncertainties associated with
forward-looking statements about
our businesses. Various responses
could realign government programs,
and aff ect the composition, funding
or timing of our programs. Flight
restrictions would negatively impact
the market for general aviation aircraft
piston engines and components.
Recent changes in the leadership of the
U.S. Congress could result over time
in reductions in defense spending and
further changes in programs in which
the Company participates.
Th e Company continues to
take action to assure compliance
with the internal controls, disclosure
controls and other requirements of the
Sarbanes-Oxley Act of 2002. While
the Company believes its control
systems are eff ective, there are inherent
limitations in all control systems, and
misstatements due to error or fraud
may occur and not be detected.
While Teledyne’s growth strategy
includes possible acquisitions, the
Company cannot provide any
assurance as to when, if, or on what
terms, any acquisitions will be made.
Acquisitions, involve various inherent
risks, such as, among others, our
ability to integrate acquired businesses
and to achieve identifi ed fi nancial and
operating synergies.
Additional information
concerning factors that could cause
actual results to diff er materially from
those projected in the forward-looking
statements is contained in Teledyne’s
periodic fi lings with the Securities and
Exchange Commission, including
its 2006 Annual Report on Form
10-K. Forward looking statements are
generally accompanied by such words
as “estimates”, “project”, “predict”,
“believes” or “expect”, that convey
the uncertainty of future events or
outcomes. Th e Company assumes
no obligation to publicly update or
revise any forward-looking statements,
whether as a result of new information
or otherwise.
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1049 Camino Dos Rios • Th ousand Oaks, California 91360 • 805.373.4545 • fax 805.373.4775 • www.teledyne.com