2014 annual report, proxy statement and notice of 2015 annual meeting of shareholders

176 Pages·2015·6.8 MB·English

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RR 2013 ANNUAL REPORT – 10-K AND PROxy
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280664_CS_Cvr_R1.indd 1 1/22/15 3:51 PM
DIRECTORS OFFICERS INVESTOR INFORMATION
CURTIS C. REUSSER CURTIS C. REUSSER CORPORATE HEADQUARTERS
Chairman, President & Chief Executive Officer Chairman, President & 500 108th Avenue N.E.
FINANCIAL HIGHLIGHTS Esterline Technologies Corporation Chief Executive Officer Suite 1500
Bellevue, WA 98004
In thousands, except per share amounts
DELORES M. ETTER ALAIN M. DURAND [phone]
Director, Caruth Institute for President, Sensors & [email protected]
Engineering Education and Systems Segment
Texas Instruments Distinguished STOCK EXCHANGE LISTING
For Fiscal Years 2014 2013 Chair in Engineering Education, ROBERT D. GEORGE New York Stock Exchange
Southern Methodist University Chief Financial Officer, Symbol – ESL
Vice President and
OPERATING RESULTS ANTHONY P. FRANCESCHINI Corporate Development TRANSFER AGENT AND REGISTRAR
Net sales $ 2,051,169 $ 1,888,777 President and Computershare
Segment earnings 312, 119 308,830 Chief Executive Officer (Retired) PAUL P. BENSON
Stantec Inc. Vice President, Human Resources SHAREHOLDER WEBSITE
Earnings from continuing operations, net of tax 166,007 170,994
www.computershare.com/investor
Loss from discontinued operations, net of tax (63,589) (6,260) PAUL V. HAACK FRANK E. HOUSTON
Net earnings 102,418 164,734 Senior Partner (Retired) President, Avionics & SHAREHOLDER ONLINE INQUIRIES
Deloitte & Touche LLP Controls Segment https://www-us.computershare.com/investor/Contact
EARNINGS (LOSS) PER SHARE — DILUTED
MARY L. HOWELL MARCIA J. MASON SHAREHOLDER RELATIONS
Continuing operations $ 5.12 $ 5.39 Executive Vice President (Retired) Vice President and [phone]
Textron, Inc. General Counsel
Discontinued operations (1.96) (0.20)
OUTSIDE OF THE U.S.
Total earnings per share - diluted 3.16 5.19 SCOTT E. KUECHLE GARY J. POSNER [phone]
Executive Vice President and Corporate Controller and
Weighted average shares outstanding - diluted 32,448 31,738
Chief Financial Officer (Retired) Chief Accounting Officer TDD HEARING IMPAIRED
Goodrich Corporation [phone]
FINANCIAL POSITION AMY L. WATSON
JERRY D. LEITMAN Associate General Counsel TDD HEARING IMPAIRED OUTSIDE
Total assets $ 3,193,467 $ 3,262,112 Chairman (Retired) and Corporate Secretary of the U.S.
Property, plant and equipment, net 319,342 371,197 FuelCell Energy, Inc. [phone]
ALBERT S. YOST
Long-term debt, net 609,720 667,859 JAMES J. MORRIS President, Advanced Materials SHAREHOLDER CORRESPONDENCE
Esterline shareholders’ equity 1,887,817 1,873,605 Vice President, Engineering Segment and Treasurer Computershare
and Manufacturing (Retired) P.O. Box 30170
The Boeing Company College Station, TX 77842-3170
$2,000 $170 $350 $2,000
GARY E. PRUITT OVERNIGHT DELIVERY
Chairman (Retired) Computershare
Univar 211 Quality Circle, Suite 210
College Station, TX 77845
HENRY W. WINSHIP IV
Principal and Senior ANNUAL MEETING OF SHAREHOLDERS
Managing Director The annual meeting will be held on
Relational Investors, LLC March 11, 2015, at 10:30 a.m. at
1,000 85 175 1,000
Perkins Coie LLP
1201 Third Avenue, 49th Floor
Seattle, WA 98101-3099
STOCK HELD IN STREET NAME
Esterline maintains a direct mailing list to
help ensure that shareholders whose stock
is held in street name (broker or similar
0 0 0 0 accounts) receive information on a timely
NET SALES EARNINGS FROM EBITDA * ESTERLINE basis. If you would like your name added
CONTINUING SHAREHOLDERS’ to this list, please send your request to
OPERATIONS, EQUITY the corporate headquarters, attention:
NET OF TAX
$ 2,051.2 $ 166.0 $ 344.6 $ 1,887.8 Director, Corporate Communications
1,888.8 171.0 343.4 1,873.6
1,877.8 113.2 279.8 1,610.5 STOCK EXCHANGE CERTIFICATIONS
Esterline has filed the CEO and CFO
1,625.9 135.6 275.8 1,562.8
certifications required by Section 302
1,458.8 124.9 249.2 1,412.8
of the Sarbanes-Oxley Act of 2002
2010 - 2014 2010 - 2014 2010 - 2014 2010 - 2014 as exhibits to its Annual Report on
dollars in millions dollars in millions dollars in millions dollars in millions
Form 10-K for the fiscal year ended
October 31, 2014, and has submitted
*This is a non-GAAP financial measure. See definition and reconciliation for EBITDA under “Item 6. Selected Financial Data” in the annual to the NYSE the annual CEO certification
report on Form 10-K included herein. required by Section 303A.12 (a)
of the NYSE listing standards.
ESTERLINE
SHAREHOLDERS’
EQUITY
280664_CS_Cvr_R1.indd 2 1/22/15 3:51 PM
10-K
ESTERLINE 2014
3 Business Overview
24 Management’s Discussion and Analysis
42 Financial Statements
48 Notes to Consolidated Financial Statements
99 Exhibit Index
UNITED STATES
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, SECURITIES AND EXCHANGE COMMISSION
and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated WASHINGTON, D.C. 20549
by reference in Part III of this Form 10-K or any amendment to this Form 10-K. 
FORM 10-K
K Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See E
- S
0 definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
T
1 E
M Large accelerated filer  Accelerated filer  For the fiscal year ended October 31, 2014. R
R Non-accelerated filer  (Do not check if a smaller reporting company) Smaller reporting company  L
O I
F OR N
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes E
 No   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
3

1 2
0 For the transition period from to 0
2 1
As of December 16, 2013, 31,575,039 shares of the Registrant’s common stock were outstanding. The aggregate market 4

value of shares of common stock held by non-affiliates as of April 26, 2013, was $2,308,350,938 (based upon the closing Commission file number 1-6357
E
N sales price of $73.86 per share). F
I O
L R

R M
TE Documents Incorpo rated by Reference ESTERLINE TECHNOLOGIES CORPORATION 1
S (Exact name of registrant as specified in its charter) 0
Part III incorporates information by reference to the registrant’s definitive proxy statement, to be filed with the Securities -
E K
and Exchange Commission within 120 days after the close of the fiscal year ended October 25, 2013.
Delaware 13-2595091

(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
500 108th Avenue N.E., Bellevue, Washington 98004
(Address of principal executive offices)(Zip Code)
Registrant’s telephone number, including area code [phone]
Securities registered pursuant to Section 12(b) of the Act:

Name of each exchange
Title of each class on which registered
Common Stock ($.20 par value) New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities
Act. Yes  No 
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the
Act. Yes  No 
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to
file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  No 
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every
Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter)
during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such
files). Yes  No 
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and
will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this Form 10-K. 
2
Ind icate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See PPAARRTT I I
defIinnditiicoante o bf y“ acchceeclke rmataerdk f iifl edri sacnldo slaurrgee o af cdceellienrqauteedn tf iflieler”rs i np uRrsuulea n1t2 tbo- 2It eomf t h4e0 5E oxfc hRaengguel aAticotn. S-K is not contained herein,
and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated ThTish Rise Rpoerpto irntc ilnucdleusd ae sn au mnubmerb oerf ofofr fwoarwrda-rldo-olkoionkgi nsgta stetamteemntesn tthsa tth raetf rleecflte tchte t hCeo Cmopmanpya’nsy c’su rcruernrte vnite vwiesw wsi twh irtehs rpeescpte tcot ftuot ure
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KK NoInn-daicccaetlee rbayt ecdh eficlker m ark whether th e r e(gDisot rnaontt cihs eac lka rigf ea ascmcaellleerra treedp ofirlteinr,g a cno amcpcaenleyr)a t e Sd mfialellre, ro rre ap onrotnin-gac ccoemlepraatneyd filer. Se e subCsoidripaorrieasti,o unn alensds soutbhesirdwiaisreie ns,o utendl eosrs coothneterxwti oseth neorwteids eo ri ncdoinctaetxest .o therwise indicates. EE
0-0- definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. SS
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  No TT
1 1  IteImte 1m. 1B. u Bsiunseisnse ss EE
MM Large accelerated filer  Accelerated filer  RR
RR Non-accelerated filer  (Do not check if a smaller reporting company) Smaller reporting company  GeGneernaelr Dale Dveelvoeplmopemnte notf oBfu Bsiunseisnse ss LL
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FF As of December 17, 2014, 31,750,610 shares of the Registrant’s common stock were outstanding. The aggregate market value NN
Esterline, a Delaware corporation formed in 1967, is a leading specialized manufacturing company principally serving
of Isnhdairceast oe fb cyo cmhmecokn m staorckk w hheeldth beyr tnhoen r-eagffisiltiraatnets iass a o sfh Mella yc o2m, 2p0an1y4 ,( wasa ds e$f3in,4e9d1 i,n1 9R2u,6le1 152 (bb-a2s eodf uthpeo nE xthceh acnlogsei nAgc st)a.l e s pYriecse of Esterline, a Delaware corporation formed in 1967, is a leading specialized manufacturing company principally serving EE
aerospace and defense customers. We design, manufacture and market highly engineered products and systems for application
13 14 $10 9 . 3 0 N poe r sh are). witaahpeirpnol tsihcpaeat ciione nda unwsdtir tdiheeisnf e wtnhesee s iecnrudvsuetso. tm rieesrs w. eW seer dvees. ign, manufacture and market highly engineered products and systems for 2 2
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22 Our current business and strategic plan focuses on continued development of our products principally for aerospace and 11
As of December 16, 2013, 31,575,039 shDaroecsu omf ethnet sR Iengciostrrpaonrt’ast ecdom bmy oRne fsetorcekn cwe e re outstanding. The aggregate market defOenusre s tmraatrekgeyt si si nto t hmreaein kteayin t eac lhenaodleorgshyi pse pgomsietniotsn: i nA nviicohneic ms &ar kCeotsn ftroorl tsh, eS ednesvoerlso p&m Senyts taenmds m, aanndu fAadctvuarnec oefd hMigahtleyr ials. Our 43
NE NE Parvstaa IlleIuIse i pnorcfi ocserhp aoorfre a$st 7eo3sf . i8cn6of mopremmr oasnthi aosrtneo )bc.k y hreefledr ebnyc neo tno- tahfefi lrieagteisst raasn ot’fs A dpefriinl i2t6iv, e2 p0r1o3x, yw satsa t$e2m,3e0n8t,, 3to5 0b,e9 3fi8le (db awsietdh uthpeo nS ethcue rcitlioessi nagn d pcarosecedansupg ccaitanbsnei la eiorrteniee dlosy fp itbnreeo nt dh rmueepcsitlessas mcitoehandar tkcb aeryirt tespi, cr etaosolds, e auwnncthttiisiac cloih pft oa hot aeothv uteehrr ecb m uegsealtonnob umdafelae scnristgeu.ne r deeWdss eofi onfa tlrooleou pwcr aoicrnnutgicsc etauon lmftaroraer trmmisn iaagllin tocadeur tyrrot iea frfniefcdosa prtctoioson mntdo m p teorexo rspccueaicanshsld . p ns lWeeaeltefedoc satr irwmveei stcl hyao n nodcu eirnn t rcaetritnagin F F
LILI E x change Commission within 120 days after the close of the fiscal year ended October 31, 2014. ourcp oreomffdopurrctesths t eoinn es tixhvpreea enso dkl ueoytui rot enccsah.p n aOobluiolrig tciyeu ssr reiegnnm tth ebenustsesi :nm eAasrsvk iaeontnsdi c assnt rd&a ta eCngtoiiccn itgprroaotlesw, ttShhee pn glsaloonrb sfa o&lc n uSesyeedsst seo omnf st oh, uea rnc dco unAsttidonvmuaoneurcsse dda neMvde arlteoesprpimaolnesnd. t t Ooof us rtuh cehs e OROR
RR needs with comprehensive solutions. These efforts focus on continuous research and new product development, acquisitions, MM
EE Documents Incorporated by Reference andp rsotrdautecgtsi ca rree aolfitgennm meinsts oiofn o cpreirtaictiaol,n ws thoi cehx phaanvde obueer nc adpeasbigilniteide si natso a p marotirceu claorm mpirleithaernys aivned scuopmplmieerr ctoia ol uprl actufostrommse arns da cinro ss
TT certain cases can only be replaced by products of other manufacturers following a formal certification process. As part of 11
our entire product offering. Such expansion included the December 2013 acquisition of the Sunbank Family of Companies, 00
SS Part III incorporates information by reference to the registrant’s definitive proxy statement, to be filed with the Securities our implementation of this growth plan, we focus on expansion of our capabilities as a more comprehensive supplier to our --
EE LLC (Sunbank), and the February 2013 acquisition of the Gamesman Group (Gamesman), which is a global supplier of input KK
and Exchange Commission within 120 days after the close of the fiscal year ended October 25, 2013. customers. Such expansion included the February 4, 2013, acquisition of the Gamesman Group (Gamesman), which is a
devices principally serving the gaming industry. These acquisitions are described in more detail in the “Overview” section of
Magnlaogbeaml seunpt’psl iDeri socfu isnspiount daenvdi cAens aplryisnicsi opfa lFlyin saenrcviianlg C tohen dgiatimonin agn idn dRuessturylt;s tohfe CJuolnyt i2n6u,i n2g0 1O1p, earcaqtuioisnist icoonn otaf itnheed S ino uIrtieamu G7 roofu p
(Souriau), which is a leading global supplier of highly engineered connection technologies for harsh environments; and the
this report.
December 30, 2010, acquisition of Eclipse Electronic Systems, Inc. (Eclipse), which develops and manufactures embedded
communication intercept receivers for signal intelligence applications. These acquisitions are described in more detail in
In December 2013, we announced the acceleration of our plans to consolidate certain facilities and create cost efficiencies
the “Overview” section of Management’s Discussion and Analysis of Financial Condition and Results of Continuing
through shared services in sales, general and administrative and support functions. Our integration activities are expected to
Operations contained in Item 7 of this report.
result in charges and expenses for a total of $35 million for fiscal 2014 and fiscal 2015. We incurred costs of $20.4 million in

fiscal 2014, with the balance to be incurred in fiscal 2015. The costs include severance, relocation of facilities, and losses from
Our products have a long history in the aerospace and defense industry and are found on most military and commercial
the write off of certain property, plant and equipment. Expense savings on short-cycle activities commenced in fiscal 2014,
aircraft, helicopters, and land-based systems. For example, our products are used on the majority of active and in-
with substantially more savings projected in fiscal 2015.
production U.S. military aircraft and on every Boeing commercial aircraft platform manufactured in the past 75 years. In
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andre ttoro cfoitn, trienpuaei rto s eimrvpicleems, eanntd o snpgaorien pga crotsm. pSlpiaanrcee p raermts eadloianle m meaadsuer uesp aanpdp rtoox iimmpalteemlye 1n0t %ad doift itoontaall sraelmese dinia fli smcaela s2u0r1e3s .r elated to
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andth eaxnp sepcat rteo pinacrtusr s aableosu. t I$n7 mmainllyio cna sine si,n ocurerm afetnetraml acroksetst sinal efiss csapla n2 0t1h5e .e nMtiorer el iifnef oorfm anat aioirnc raabfot.u t the Consent Agreement is set
for th under U.S. Government Contracts and Subcontracts in Part I, Item 1 of this report.
We differentiate ourselves through our engineering and manufacturing capabilities and our reputation for safety, quality,
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thea duidsittrsi.b uOtiuorn i nbduusisntreisess aarree ihnicglhuldye dre ignu olautre dA, vainodn iccosm &p lCiaonnctero wlsi tshe gamppelnict,a bWlea lrleogpu ilsa tiinocnlsu,d iendc liund oinugr eAxdpvoarnt cceodn tMroal taenrida lasn ti-
segbmriebnetr,y a rnedg uPlAat&ioEn si,s iisn acnlu idmedp oirnt aonutr f Soecnusso irns o&u rS byussteinmess ss.e gFmore next.a mThpeles,e w beu shianveess ae sg aloreb arle cpoodrtee do fa bs udsiisnceosnst icnouneddu ocpt earnadt ions.
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disIcno natdidniuteiodn o, pweer amtiaoinnst.a in local ethics advisors and export control specialists in our business units to support our compliance
efforts.
In S eptember 2014, we agreed to acquire the aerospace and defense display businesses of Barco N.V. The business designs
andO mura snaulfeasc aturere dsi hviegrhsi-ftieecdh ancorloosgsy t,h hraeres hb-reonavdi rmoanrmkeetnst: d disepfelanysse ,a cnodm vmisueracliizaal taioerno ssoplaucteio, nans,d h goelndeinragl pinodsiutisotrnisa li.n Faovrio fnisiccas,l
def2e0n1s3e,, aaiprp trroaxffiimc actoenlytr o3l5,% an odf torauirn sinagle sa nwde sriem furolamti othne m daerfkenetsse. m Tahrek etrta, n4s5a%ct iforno mis tehxep ceocmtedm teor ccilaols aee irno sJpaancuea rmy a2r0k1et5,, and 20%
confrtionmge tnhte u gpeonne rcaolm inpdleutsitornia lo mf caerrkteati.n French regulatory procedures, and other customary closing conditions. The acquisition
pur chase price of €150 million, or approximately $187 million, will be funded primarily by international cash reserves. The
bus iness will be included in our Avioni cs & Controls segment.
2 33
Ind icate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See PART I
defIinnditiicoante o bf y“ acchceeclke rmataerdk f iifl edri sacnldo slaurrgee o af cdceellienrqauteedn tf iflieler”rs i np uRrsuulea n1t2 tbo- 2It eomf t h4e0 5E oxfc hRaengguel aAticotn. S-K is not contained herein,
and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated This Report includes a number of forward-looking statements that reflect the Company’s current views with respect to future
Larbgye raecfecreelenrcaet eidn fPialerrt III of this For m  1 0-K or any amendment to this Form 10-K.  Accelerated filer  events and financial performance. Please refer to the section addressing forward-looking information on page 10 for further
discussion. In this report, “we,” “our,” “us,” “Company,” and “Esterline” refer to Esterline Technologies Corporation and
K NoInn-daicccaetlee rbayt ecdh eficlker m ark whether th e r e(gDisot rnaontt cihs eac lka rigf ea ascmcaellleerra treedp ofirlteinr,g a cno amcpcaenleyr)a t e Sd mfialellre, ro rre ap onrotnin-gac ccoemlepraatneyd filer. Se e subsidiaries, unless otherwise noted or context otherwise indicates. E
0- definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. S
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  No T
1  Item 1. Business E
M Large accelerated filer  Accelerated filer  R
R Non-accelerated filer  (Do not check if a smaller reporting company) Smaller reporting company  General Development of Business L
O I
F As of December 17, 2014, 31,750,610 shares of the Registrant’s common stock were outstanding. The aggregate market value N
Esterline, a Delaware corporation formed in 1967, is a leading specialized manufacturing company principally serving
of Isnhdairceast oe fb cyo cmhmecokn m staorckk w hheeldth beyr tnhoen r-eagffisiltiraatnets iass a o sfh Mella yc o2m, 2p0an1y4 ,( wasa ds e$f3in,4e9d1 i,n1 9R2u,6le1 152 (bb-a2s eodf uthpeo nE xthceh acnlogsei nAgc st)a.l e s pYriecse of E
aerospace and defense customers. We design, manufacture and market highly engineered products and systems for application
3 $109 . 3 0 N poe r sh are). within the industries we serve.
1 2
0 0
2 Our current business and strategic plan focuses on continued development of our products principally for aerospace and 1
As of December 16, 2013, 31,575,039 shDaroecsu omf ethnet sR Iengciostrrpaonrt’ast ecdom bmy oRne fsetorcekn cwe e re outstanding. The aggregate market defense markets in three key technology segments: Avionics & Controls, Sensors & Systems, and Advanced Materials. Our 4
NE Parvstaa IlleIuIse i pnorcfi ocserhp aoorfre a$st 7eo3sf . i8cn6of mopremmr oasnthi aosrtneo )bc.k y hreefledr ebnyc neo tno- tahfefi lrieagteisst raasn ot’fs A dpefriinl i2t6iv, e2 p0r1o3x, yw satsa t$e2m,3e0n8t,, 3to5 0b,e9 3fi8le (db awsietdh uthpeo nS ethcue rcitlioessi nagn d pcarosedsu cctasn a oren loyf tbeen rmepilsascioend cbryi tpicraold, uwchtsi cohf hoathveer b meeann udfeascitgunreeds fiontlolo pwairntgic au lfaorr mmialli tcaeryrt iafnicda tcioomn mpreorcceiassl .p lWatfeo arrme sc aonndc einnt rcaetritnagin F
LI E x change Commission within 120 days after the close of the fiscal year ended October 31, 2014. our efforts to expand our capabilities in these markets and anticipate the global needs of our customers and respond to such OR
R needs with comprehensive solutions. These efforts focus on continuous research and new product development, acquisitions, M
E Documents Incorporated by Reference and strategic realignment of operations to expand our capabilities as a more comprehensive supplier to our customers across
T 1
our entire product offering. Such expansion included the December 2013 acquisition of the Sunbank Family of Companies, 0
S
Part III incorporates information by reference to the registrant’s definitive proxy statement, to be filed with the Securities -
E LLC (Sunbank), and the February 2013 acquisition of the Gamesman Group (Gamesman), which is a global supplier of input K
and Exchange Commission within 120 days after the close of the fiscal year ended October 25, 2013.
devices principally serving the gaming industry. These acquisitions are described in more detail in the “Overview” section of
Management’s Discussion and Analysis of Financial Condition and Results of Continuing Operations contained in Item 7 of
this report.
In December 2013, we announced the acceleration of our plans to consolidate certain facilities and create cost efficiencies
through shared services in sales, general and administrative and support functions. Our integration activities are expected to
result in charges and expenses for a total of $35 million for fiscal 2014 and fiscal 2015. We incurred costs of $20.4 million in
fiscal 2014, with the balance to be incurred in fiscal 2015. The costs include severance, relocation of facilities, and losses from
the write off of certain property, plant and equipment. Expense savings on short-cycle activities commenced in fiscal 2014,
with substantially more savings projected in fiscal 2015.
In March 2014, we entered into a Consent Agreement with the U.S. Department of State’s Directorate of Defense Trade
Controls Office of Defense Trade Controls Compliance (DDTC) to resolve alleged International Traffic in Arms Regulations
(ITAR) civil violations. Among other things, the Consent Agreement requires us to pay a $20 million penalty, of which
$10 million was suspended and eligible for offset credit based upon verified expenditures for past and future remedial actions,
and to continue to implement ongoing compliance remedial measures and to implement additional remedial measures related to
ITAR compliance activities. Due to these requirements, in fiscal 2014 we incurred $9 million in incremental compliance costs
and expect to incur about $7 million in incremental costs in fiscal 2015. More information about the Consent Agreement is set
forth under U.S. Government Contracts and Subcontracts in Part I, Item 1 of this report.
In September 2014, our board of directors approved the plan to sell certain non-core business units including Eclipse Electronic
Systems, Inc. (Eclipse), a manufacturer of embedded communication intercept receivers for signal intelligence applications;
Wallop Defence Systems, Ltd. (Wallop), a manufacturer of flare countermeasure devices; Pacific Aerospace and Electronics
Inc. (PA&E), a manufacturer of hermetically sealed electrical connectors; and an immaterial distribution business. Eclipse and
the distribution business are included in our Avionics & Controls segment, Wallop is included in our Advanced Materials
segment, and PA&E is included in our Sensors & Systems segment. These businesses are reported as discontinued operations.
We recorded an estimated after-tax loss of $49.5 million in the fourth fiscal quarter of 2014 on the assets held for sale in
discontinued operations.
In September 2014, we agreed to acquire the aerospace and defense display businesses of Barco N.V. The business designs
and manufactures high-technology, harsh-environment displays and visualization solutions, holding positions in avionics,
defense, air traffic control, and training and simulation markets. The transaction is expected to close in January 2015,
contingent upon completion of certain French regulatory procedures, and other customary closing conditions. The acquisition
purchase price of €150 million, or approximately $187 million, will be funded primarily by international cash reserves. The
business will be included in our Avionics & Controls segment.
2 3
Ou r products have a long history in the aerospace and defense industry and are found on most military and commercial aircraft, In addition, we design and manufacture ruggedized military pPeArsRoTna Il communication equipment, primarily headsets, handsets
helIincdoipctaetres ,b ayn cdh leacnkd -mbaarsked i fs dyisstcelmossu. r Fe oorf edxealminpqluee, notu fri lperros dpuucrtssu aarnet utos eIdte omn 4th0e5 mofa Rjoergituyl aotfi oanc tSiv-eK a insd n iont- cporondtauicnteiodn h Uer.eSin. , and field communications. We are the sole supplier of Active No ise Reduction (ANR) headsets to the British Army’s tracked
milaintadr yw aililr cnroatf tb aen cdo notna ienveedr,y t oB otheein bge scto omfm reegricsitarla anitr’csr kanfto pwlaletfdogrem, imn adneufifnaicttiuvree pdr ionx tyh eo rp iansfto 7rm5 ayteiaorns .s tIante amdednittiso inn, coourrp oprraotdeudc ts andT hwihs eReelepdo rvte ihniccllued feles eat sn uunmdbeerr t hoef fBoorwwamrda-nl ocookminmgu sntiactaetmioenn tssy tshteamt r epfrloegcrt atmhe. C Wome spuapnpyl’ys AcuNrrRen hte vaideswests w toit hth ree Usp.eSc. tA tor my’s
areb syu rpepfleireedn tcoe Aini rPbaurst, ImIIa onfy t hoifs t Fheo rmma 1jo0r- Kre goiro annayl aanmde bnudsmineensts tjoe tt hmisa nFuoframc t1u0re-rKs,. a nd the major aircraft engine manufacturers. tracfukteudr ea nedv ewnthse aenledd fvineahniccliea lf lpeeertfso, rimncalnucdei.n gP Mleainsee -rRefeesri sttoa ntht eA smecbtuiosnh Padrodtreecstseindg ( MfoRrwAaPrds)- laonodk iMngR iAnfPo rAmlla Ttioenrr aoinn pVaeghei c1l0e f(oMr -
We work closely with OEMs on new, highly engineered products with the objective of such products becoming designed into ATfVurst)h tehrr doiusgchu stshieo nV. e Ihnic tlhei sI nrteeprocrotm, “ Swyes,”te “mo u(Vr,”IS “)u asn,”d “ VCIoSm-Xpa pnryo,g” raanmds “ cEosmteprlriinsien”g r oefveerr t2o0 E0s,0te0r0li nvee hTiecclehsn. o Wlogei easre the sole
KK ourI ncduisctaotme ebrys ’c phleactkfo mrmarsk; twhihse itnhteerg trhaeti roeng oisfttreann tr eiss ual tlsa rign es oalcec-esloeurarcteed p foilseitri,o anns afcocr eOleEraMte dp rfoidleurc, toior na annodn -aafctecremlearrakteedt bfiulseirn. e Ssse.e supCpolirepro troa ttihoen Uan.Sd. sMubasriidniea rCieosr,p us nfloers sth oetihr eMrwRiAseP n aontedd M or- AcoTnVte fxlte eottsh.e rWweis ear ien daliscoa ttehse. sole ANR headset supplier to the EE
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00 Wed ebfrionaitdiloyn c oaft e“gaocrciezlee roauter dc ofimlemr aerncdi alla ragned amccileiltearrayt eade rfoislepra”c ien a Rftuelrem 1a2rkbe-2t soafl eths ea sE rxecthroafnigt,e r eApcati.r services, and spare parts. Ca nadian Army. We have a long-standing relationship with armies around the world, including forces in Australia, India,
TT
1 1 Sp are parts alone made up approximately 8.5% of total sales in fiscal 2014. Retrofit and repair services, which represent 5% of SauItdeim A r1a.b iBa,u asninde Sssp ain. In fiscal 2014, some of our largest customers for these products included BAE Systems, The Boeing EE
MM tot al saLleasr igne faiscccaell e2r0a1te4d, fcialerrry hig her margins than OEM sales but lower margiAnsc cthealenr astpeadr ef iplearr ts sales. In many cases, our Co mpany, the British Ministry of Defence (MoD), L-3 Communications, Lockheed Martin, Northrop Grumman, and Sanmina. RR
RR afte rmaNrkoent- saaclceesl esrpaatne dt hfeil eern tire li f(eD oo fn oatn c haeicrkc riaf fat s. m aller reporting company) Smaller reporting company  General Development of Business LL
OO II
FF We also manufacture a full line of keyboard, switch and input technologies for specialized medical equipment and NN
WeIn ddiifcfeartee nbtyia cteh eocukrs melavreks wthhreotuhgehr tohuer reenggisintreaenrti nisg aa nshde mll acnoumfapcatnuyri n(ags cdaepfainbeildit iiens R aunlde o1u2rb r-e2p ouft athtieo nE fxocrh saanfgeety A, qctu)a. l i t y ,Y oens- comEsmteurnliincea,t iao nD seylaswteamres fcoorr pmoirlaittaioryn afoprpmliecdat iionn 1s9. 6 T7,h eiss ea pleraoddiuncgt ss ipneccliuadliez ecdu smtoamnu kfeayctbuorainrdgs c, okmeyppaandys ,p arinndc iipnaplulyt dseevrvicinegs that EE
time d e lNivoe r y, r eliability, and innovation – all embodied in the Esterline Performance System, our way of approaching business inteagerroatsep accuers aonrd c odneftreonls ed ecvuiscteosm, bearsr.c o Wdee sdceasningenr,s m, dainsupflaacytsu, rvei daenod, manadrk veot ihcieg ahclyti veantgioinne. e rWede parlosod upcrtosd auncde sinyssttreummse fnotrs that are
34
11 tha t helps ensure all employees are focused on continuous improvement. Safety of our operations is a critical factor in our useadp pfolirc patoiionnt -wofi-thusine tahned i pnodiunstt-roief-sc waree sdeiravgen. ostics. We have developed a wide variety of technologies, including plastic and 2 2
00 bus iness, and accordingly, we incorporate applicable regulatory guidance in the design of our facilities and train our employees vin yl membranes that protect high-use switches and fully depressible buttons, and backlit elastomer switch coverings that are 00
22 11
usiAngs oa fb Deheacveimorb-ebra 1se6d, 2a0p1p3ro, a3c1h,5 t7h5at,0 f3o9c ussheasr eosn o sfa tfheety R-deegsiisgtnraendt ’ws ocrokm hmaboints s atoncdk o wn-egreo ionugt sstaafnedtyin agu. d Titsh.e Oagugrr iengdautes tmrieasr kaerte resOisutarn stt rtoat eegxpyo issu troe mfraoimnt ahianr sah l ecahdeemrsichaipls p. o Tshiteiosen tienc nhincohleo gmieasr kneotsw f oser rtvhee adse tvheel ofpomunednat taionnd fmora nau sfmacatlul rbeu ot fg hroigwhilnyg portion of 43

higvhallyu ere ogfu slahtaerde,s a onfd c coommmpolina nsctoec wk ihthe ladp bpyli cnaobnl-ea rfefigliualtaetsio anss o, fin Aclpurdili n2g6 ,e 2x0p1o3rt, cwoanst r$o2l ,a3n0d8 ,a3n5t0i-,b9r3i8b e(rbya sreedg uulpaotino nths,e i cs laons ing oure npgroindeuecrte ldin per.o dInu cftiss ctahla 2t 0ar1e4 ,e sssoemneti aolf toou oru lra rcguesstto mcuesrtso.m Weres aforer tchoenscee pnrtoradtuincgts oiunrc leufdfoerdt sA tloe reex,p Aanrids tsoeclreactt iTveeclyh nooulro gies,
NENE impsaolretsa nptr ifcoec uosf i$n7 3o.u8r6 b puesrin sehsasr.e )F. or example, we have a global code of business conduct and ethics that covers compliance Gecnaepraalb Eililteicetsr iicn, tIhnesspei rmeda rGkeatms,i ntog ,a Mntiecricpka,t eN tuhaen gcelo, bPahli nliepesd, sR oofc hoeu,r acnuds tSoimemeresn asn. d to respond to such needs with F F
II wit h laws, and we provide training on this code to our worldwide employees. In addition, we maintain local ethics advisors comprehensive solutions. Our current business and strategic growth plan focuses on the continuous development of these OO
LL and export control specialists in our business units to support our compliance efforts. Senpsroodrsu c&ts Siny stthermees k ey technology segments: Avionics & Controls, Sensors & Systems, and Advanced Materials. Our RR
RR MM
TETE Our sales are diversified across three broad mDaorckuemts:e n dtesf Ienncsoe,r pcoo mramteedrc biayl Raeerfoesrpeanccee, and general industrial. For fiscal 2014, Oupcre rSortedanuisnco tcsras a s&rees Socfyatsnetn eo mnmlsiy sb sbuieos inrne ceprslisat icsceeadgl ,mb wye hnpitrc oihnd chulacuvtdsee osb fep oeontwh deerer smsiygasnnteeudmf aiscn,t tucoor penransre tficoctluiloloanwr timencgihl inata ofrloyor gmaineadsl accneordmt iamfidcevaratcinioacnle dpp lrsaoetcfnoessromsr.s s Acaansp dpa abinritl iotife s. 1 1
SS appPraorxt iImIIa itneclyo r3p0o%ra toefs oinufro sramleast iwone rbey f rroefme rtehnec ed etfoe tnhsee rmegairskterat,n 5t’0s% d effrionmiti vthee p croomxym setracteiaml eanetr,o tsop abcee f mileadr kweitt, ha nthde 2 S0e%cu frriotimes the Weo udre vimelpolpe manedn tmataionnu foafc ttuhries ghrigohw-tphr epcliasnio, nw ete fmopcuersa otunr ee,x ppraensssiuorne oafn odu srp ceaepda sbeinlistioerss apsr ian cmipoarell yc ofmorp areerhoesnpsaivcee csuupstpolmieer rtso, our 0-0-
EE general industrial market. electrical interconnection systems for severe environments for aerospace, defense, geophysics & marine, and nuclear KK
and Exchange Commission within 120 days after the close of the fiscal year ended October 25, 2013. customers. Such expansion included the February 4, 2013, acquisition of the Gamesman Group (Gamesman), which is a
customers, as well as electrical power switching, control and data communication devices, and other related systems
global supplier of input devices principally serving the gaming industry; the July 26, 2011, acquisition of the Souriau Group
Financial Information About Industry Segments principally for aerospace and defense customers. We are the OEM sole-source and aftersales supplier of temperature probes
(Souriau), which is a leading global supplier of highly engineered connection technologies for harsh environments; and the
for use on all versions of the General Electric/Snecma CFM-56 jet engine. The CFM-56 jet engine has an installed base of
December 30, 2010, acquisition of Eclipse Electronic Systems, Inc. (Eclipse), which develops and manufactures embedded
A summary of net sales to unaffiliated customers, operating earnings and identifiable assets attributable to our business 25,700, is standard equipment on the current generation Boeing 737 aircraft, and was selected as the engine for approximately
communication intercept receivers for signal intelligence applications. These acquisitions are described in more detail in
segments for fiscal years 2014, 2013, and 2012 is reported in Note 17 to the Company’s Consolidated Financial Statements, 55% of all Airbus single-aisle aircraft delivered to date. We manufacture sensors for the environmental control system for
the “Overview” section of Management’s Discussion and Analysis of Financial Condition and Results of Continuing
and appears in Item 8 of this report. Boeing 787 aircraft, and provide the primary power distribution assembly for the Airbus A400M military transport.
Operations contained in Item 7 of this report.
Additionally, we have a Tier 1 position with Rolls-Royce for a large suite of sensors for the engines that power the A400M and

Description of Business A350. We design and manufacture micro packaging, planet probe interconnectors, launcher umbilicals, and composite
Our products have a long history in the aerospace and defense industry and are found on most military and commercial
connectors for the Boeing 787. Unique electrical interconnection products account for a significant portion of our connection
Avionics & Controls aircraft, helicopters, and land-based systems. For example, our products are used on the majority of active and in-
technologies sales. The principal customers for our products in this business segment are jet engine manufacturers, airframe
production U.S. military aircraft and on every Boeing commercial aircraft platform manufactured in the past 75 years. In
and industrial manufacturers. In fiscal 2014, some of our largest customers for these products included Airbus, The Boeing
Our Avionics & Controls business segment includes avionics systems, control and communication systems, and interface addition, our products are supplied to Airbus, many of the major regional and business jet manufacturers, and the major
Company, Bombardier, Dassault, Flame, General Electric, Honeywell, Labinal, Rolls-Royce, SAFRAN, Sercel, TTI, Inc., and
technologies capabilities. Avionics systems designs and develops cockpit systems integration and avionics subsystems for aircraft engine manufacturers. We work closely with OEMs on new, highly engineered products with the objective of such
UTC.
commercial and military applications. Control and communication systems designs and manufactures technology interface products becoming designed into our customers’ platforms; this integration often results in sole-source positions for OEM
systems for military and commercial aircraft and land-based as well as sea-based military vehicles. Additionally, control and production and aftermarket business. We broadly categorize our commercial and military aerospace aftermarket sales as
Advanced Materials
communication systems designs and manufactures military audio and data products for severe battlefield environments and retrofit, repair services, and spare parts. Spare parts alone made up approximately 10% of total sales in fiscal 2013.
communication control systems to enhance security and aural clarity in military applications. Interface technologies Retrofit and repair services, which represent 5% of total sales, carry higher margins than OEM sales, but lower margins
Our Advanced Materials business segment includes engineered materials and defense technologies capabilities. We develop
manufactures and develops custom control panels and input systems for medical, industrial, military and gaming industries. than spare parts sales. In many cases, our aftermarket sales span the entire life of an aircraft.
and manufacture high-performance elastomer products used in a wide range of commercial aerospace, space, military
We are a market leader in global positioning systems (GPS), head-up displays, enhanced vision systems, and electronic flight
applications, and highly engineered thermal components for commercial aerospace and industrial applications. We also
management systems that are used in a broad variety of control and display applications. In addition, we develop, manufacture We differentiate ourselves through our engineering and manufacturing capabilities and our reputation for safety, quality,
develop and manufacture combustible ordnance and countermeasures for military applications.
and market sophisticated, highly reliable technology interface systems for commercial and military aircraft. These products on-time delivery, reliability, and innovation – all embodied in the Esterline Performance System, our way of approaching
include lighted push-button and rotary switches, keyboards, lighted indicators, panels and displays. Our products have been Spebcuisailnizeesds tHhaigt hh-ePlpesr feonrmsuarne cael lA epmpplilcoayteioens sa.r eW foec supseecdi aolniz ceo innt itnhue oduesv eimlopprmoveenmt oefn tp.r oSparfieettya royf foourmr ouplaetriaotniosn fso ris s ail iccroitnicea rlu bber
integrated into many existing aircraft designs, including every Boeing commercial aircraft platform currently in production. andfa octthoerr i nel oasutro bmuesri npersosd, uacntds. a cOcuorr deilnasgtloym, were pinrocdourpctosr aatree aepnpgliinceaebrleed r etog ualdadtoreryss g supiedcainficce cinu stthoem deers riegqnu oirfe omuer nftasc wilihtieerse asnudp erior
Our large installed base provides us with a significant spare parts and retrofit business. We are a Tier 1 supplier on the Boeing pertfroarinm oanucr ee minp hloigyhe etes muspienrga tau rbee,h haivgiho rp-rbeassseudr ea,p cparuosatcich, tahbarta fsoivceu saensd o ont hsaefre dtyif-fdiceusilgt neendv iwroonrmk ehnatbsi tiss acnridti coanl-.g oTihnegs esa pferotyd ucts
787 program to design and manufacture all of the cockpit overhead panels and embedded software for these systems. We incaluuddeit sc.l a Omupri ningd duesvtriiceess ,a rthe ehrimghally f irreeg bualarrtieedr, iannsdu lcaotimonp lpiarondceu cwtsi,t hs eaaplpinligc asybslete rmegsu, ltautbioinngs ,a inndc lcuodvinergi negxsp odrets icgonnetdro iln a cnuds atonmti--
manufacture control sticks, grips and wheels, as well as specialized switching systems. In this area, we primarily serve mobldriebde rsyh arepgeus.l a Stioomnse, iosf atnh ei mprpoodrutacntst finoccluusd ien poruorp briuestainryes esl.a sFtoorm eexrasm thpalte ,a rwee s pheacvief iac agllloyb dael sciogdnee do ff obru ussinee osns coor nndeuacr ta a jnedt
commercial and military aviation, and airborne and ground-based military equipment manufacturing customers. For example, engeitnheic. s W thea ta creo vae lresa cdoinmgp Ulia.Sn.c seu wppitlhie lra wofs h, iagnhd- pweer fporromvaidnecde etrlaaisntoinmge or np rthoidsu ccotsd eto t oth oeu are wroosrpldacwei dined eumstprylo, yweietsh ionu fri spcraiml 2a0r1y 3.
we are a leading manufacturer of pilot control grips for most types of military fighter jets and helicopters. Additionally, our cusItno madedrist ifoonr, twhees em parinotdauinct slo bceailn egt hjeict sa anddv rioscokrse ta enndg einxep omrta cnounfatrcotul rsepresc, icaolimstms ienr coiuarl abnudsi mneislist aurnyi tasi rtofr asmupep morat nouufra ccotumreprlsi,a nasc e
software engineering center supports our customers’ needs with such applications as primary flight displays, flight weellf faosr tcso. m mercial airlines. In fiscal 2014, some of the largest customers for these products included The Boeing Company,
management systems, air data computers and engine control systems. KA PCO, Lockheed Martin, Northrop Grumman, Spirit AeroSystems, and Wesco Aircraft.
Our sales are diversified across three broad markets: defense, commercial aerospace, and general industrial. For fiscal
Our proprietary products meet critical operational requirements and provide customers with significant technological We2 0a1ls3o, daepvperoloxpim anadte lmy a3n5u%fa cotfu oreu rh isgahle tse wmepreer afrtuorme, tlhige hdtewfeenigshet mmaertkaellti,c 4 i5n%su flarotimon t hsye scteommsm feorrc aiaelr oaesproascpea acned m marakriente, and 20%
advantages in such areas as night vision compatibility and active-matrix liquid-crystal displays (a technology enabling pilots to appfrliocmat itohnes g. e Oneurra cl oinmdmusetrrciaial lm aaerrkoespt.a ce programs include the Boeing 737, A320, and A380 series aircraft and the V2500 and
read display screens in a variety of light conditions as well as from extreme angles). Our products are incorporated in a wide BR 710 engines. Our insulation material is used on diesel engine manifolds for earthmoving and agricultural applications. In
variety of platforms ranging from military helicopters, fighters and transports, to commercial wide- and narrow-body, regional add ition, we specialize in the developm ent of thermal protection for fire, nuclear, and petro-chemical industries. We design
and business jets. In fiscal 2014, some of our largest customers for these products included Airbus, BAE Systems, The Boeing and manufacture high temperature components for industrial and marine markets. Our manufacturing processes consist of
Company, Hawker Beechcraft, Honeywell, Lockheed Martin, Pilatus Aircraft, Rockwell Collins, Sikorsky, and Thales. cutting, pressing, and welding stainless steel, inconel, and titanium fabrications. In fiscal 2014, some of the largest customers
42 53
Ou r products have a long history in the aerospace and defense industry and are found on most military and commercial aircraft, In addition, we design and manufacture ruggedized military personal communication equipment, primarily headsets, handsets
helIincdoipctaetres ,b ayn cdh leacnkd -mbaarsked i fs dyisstcelmossu. r Fe oorf edxealminpqluee, notu fri lperros dpuucrtssu aarnet utos eIdte omn 4th0e5 mofa Rjoergituyl aotfi oanc tSiv-eK a insd n iont- cporondtauicnteiodn h Uer.eSin. , and field communications. We are the sole supplier of Active Noise Reduction (ANR) headsets to the British Army’s tracked
milaintadr yw aililr cnroatf tb aen cdo notna ienveedr,y t oB otheein bge scto omfm reegricsitarla anitr’csr kanfto pwlaletfdogrem, imn adneufifnaicttiuvree pdr ionx tyh eo rp iansfto 7rm5 ayteiaorns .s tIante amdednittiso inn, coourrp oprraotdeudc ts and wheeled vehicle fleets under the Bowman communication system program. We supply ANR headsets to the U.S. Army’s
areb syu rpepfleireedn tcoe Aini rPbaurst, ImIIa onfy t hoifs t Fheo rmma 1jo0r- Kre goiro annayl aanmde bnudsmineensts tjoe tt hmisa nFuoframc t1u0re-rKs,. a nd the major aircraft engine manufacturers. tracked and wheeled vehicle fleets, including Mine-Resistant Ambush Protected (MRAPs) and MRAP All Terrain Vehicle (M-
We work closely with OEMs on new, highly engineered products with the objective of such products becoming designed into ATVs) through the Vehicle Intercom System (VIS) and VIS-X programs comprising over 200,000 vehicles. We are the sole
K ourI ncduisctaotme ebrys ’c phleactkfo mrmarsk; twhihse itnhteerg trhaeti roeng oisfttreann tr eiss ual tlsa rign es oalcec-esloeurarcteed p foilseitri,o anns afcocr eOleEraMte dp rfoidleurc, toior na annodn -aafctecremlearrakteedt bfiulseirn. e Ssse.e supplier to the U.S. Marine Corps for their MRAP and M-ATV fleets. We are also the sole ANR headset supplier to the E
- S
0 Wed ebfrionaitdiloyn c oaft e“gaocrciezlee roauter dc ofimlemr aerncdi alla ragned amccileiltearrayt eade rfoislepra”c ien a Rftuelrem 1a2rkbe-2t soafl eths ea sE rxecthroafnigt,e r eApcati.r services, and spare parts. Canadian Army. We have a long-standing relationship with armies around the world, including forces in Australia, India,
T
1 Sp are parts alone made up approximately 8.5% of total sales in fiscal 2014. Retrofit and repair services, which represent 5% of Saudi Arabia, and Spain. In fiscal 2014, some of our largest customers for these products included BAE Systems, The Boeing E
M tot al saLleasr igne faiscccaell e2r0a1te4d, fcialerrry hig her margins than OEM sales but lower margiAnsc cthealenr astpeadr ef iplearr ts sales. In many cases, our Company, the British Ministry of Defence (MoD), L-3 Communications, Lockheed Martin, Northrop Grumman, and Sanmina. R
R afte rmaNrkoent- saaclceesl esrpaatne dt hfeil eern tire li f(eD oo fn oatn c haeicrkc riaf fat s. m aller reporting company) Smaller reporting company  L
O I
F We also manufacture a full line of keyboard, switch and input technologies for specialized medical equipment and N
WeIn ddiifcfeartee nbtyia cteh eocukrs melavreks wthhreotuhgehr tohuer reenggisintreaenrti nisg aa nshde mll acnoumfapcatnuyri n(ags cdaepfainbeildit iiens R aunlde o1u2rb r-e2p ouft athtieo nE fxocrh saanfgeety A, qctu)a. l i t y ,Y oens- communication systems for military applications. These products include custom keyboards, keypads, and input devices that E
time d e lNivoe r y, r eliability, and innovation – all embodied in the Esterline Performance System, our way of approaching business integrate cursor control devices, barcode scanners, displays, video, and voice activation. We also produce instruments that are
3
1 tha t helps ensure all employees are focused on continuous improvement. Safety of our operations is a critical factor in our used for point-of-use and point-of-care diagnostics. We have developed a wide variety of technologies, including plastic and 2
0 bus iness, and accordingly, we incorporate applicable regulatory guidance in the design of our facilities and train our employees vinyl membranes that protect high-use switches and fully depressible buttons, and backlit elastomer switch coverings that are 0
2 1
usiAngs oa fb Deheacveimorb-ebra 1se6d, 2a0p1p3ro, a3c1h,5 t7h5at,0 f3o9c ussheasr eosn o sfa tfheety R-deegsiisgtnraendt ’ws ocrokm hmaboints s atoncdk o wn-egreo ionugt sstaafnedtyin agu. d Titsh.e Oagugrr iengdautes tmrieasr kaerte resistant to exposure from harsh chemicals. These technologies now serve as the foundation for a small but growing portion of 4

higvhallyu ere ogfu slahtaerde,s a onfd c coommmpolina nsctoec wk ihthe ladp bpyli cnaobnl-ea rfefigliualtaetsio anss o, fin Aclpurdili n2g6 ,e 2x0p1o3rt, cwoanst r$o2l ,a3n0d8 ,a3n5t0i-,b9r3i8b e(rbya sreedg uulpaotino nths,e i cs laons ing our product line. In fiscal 2014, some of our largest customers for these products included Alere, Aristocrat Technologies,
NE impsaolretsa nptr ifcoec uosf i$n7 3o.u8r6 b puesrin sehsasr.e )F. or example, we have a global code of business conduct and ethics that covers compliance General Electric, Inspired Gaming, Merck, Nuance, Philips, Roche, and Siemens. F
I wit h laws, and we provide training on this code to our worldwide employees. In addition, we maintain local ethics advisors O
L and export control specialists in our business units to support our compliance efforts. Sensors & Systems R
R M
TE Our sales are diversified across three broad mDaorckuemts:e n dtesf Ienncsoe,r pcoo mramteedrc biayl Raeerfoesrpeanccee, and general industrial. For fiscal 2014, Our Sensors & Systems business segment includes power systems, connection technologies and advanced sensors capabilities. 1
S approximately 30% of our sales were from the defense market, 50% from the commercial aerospace market, and 20% from the We develop and manufacture high-precision temperature, pressure and speed sensors principally for aerospace customers, 0
Part III incorporates information by reference to the registrant’s definitive proxy statement, to be filed with the Securities -
E general industrial market. electrical interconnection systems for severe environments for aerospace, defense, geophysics & marine, and nuclear K
and Exchange Commission within 120 days after the close of the fiscal year ended October 25, 2013.
customers, as well as electrical power switching, control and data communication devices, and other related systems

Financial Information About Industry Segments principally for aerospace and defense customers. We are the OEM sole-source and aftersales supplier of temperature probes
for use on all versions of the General Electric/Snecma CFM-56 jet engine. The CFM-56 jet engine has an installed base of
A summary of net sales to unaffiliated customers, operating earnings and identifiable assets attributable to our business 25,700, is standard equipment on the current generation Boeing 737 aircraft, and was selected as the engine for approximately
segments for fiscal years 2014, 2013, and 2012 is reported in Note 17 to the Company’s Consolidated Financial Statements, 55% of all Airbus single-aisle aircraft delivered to date. We manufacture sensors for the environmental control system for
and appears in Item 8 of this report. Boeing 787 aircraft, and provide the primary power distribution assembly for the Airbus A400M military transport.
Additionally, we have a Tier 1 position with Rolls-Royce for a large suite of sensors for the engines that power the A400M and
Description of Business A350. We design and manufacture micro packaging, planet probe interconnectors, launcher umbilicals, and composite
connectors for the Boeing 787. Unique electrical interconnection products account for a significant portion of our connection
Avionics & Controls
technologies sales. The principal customers for our products in this business segment are jet engine manufacturers, airframe
and industrial manufacturers. In fiscal 2014, some of our largest customers for these products included Airbus, The Boeing
Our Avionics & Controls business segment includes avionics systems, control and communication systems, and interface
Company, Bombardier, Dassault, Flame, General Electric, Honeywell, Labinal, Rolls-Royce, SAFRAN, Sercel, TTI, Inc., and
technologies capabilities. Avionics systems designs and develops cockpit systems integration and avionics subsystems for
UTC.
commercial and military applications. Control and communication systems designs and manufactures technology interface
systems for military and commercial aircraft and land-based as well as sea-based military vehicles. Additionally, control and
Advanced Materials
communication systems designs and manufactures military audio and data products for severe battlefield environments and
communication control systems to enhance security and aural clarity in military applications. Interface technologies
Our Advanced Materials business segment includes engineered materials and defense technologies capabilities. We develop
manufactures and develops custom control panels and input systems for medical, industrial, military and gaming industries.
and manufacture high-performance elastomer products used in a wide range of commercial aerospace, space, military
We are a market leader in global positioning systems (GPS), head-up displays, enhanced vision systems, and electronic flight
applications, and highly engineered thermal components for commercial aerospace and industrial applications. We also
management systems that are used in a broad variety of control and display applications. In addition, we develop, manufacture
develop and manufacture combustible ordnance and countermeasures for military applications.
and market sophisticated, highly reliable technology interface systems for commercial and military aircraft. These products
include lighted push-button and rotary switches, keyboards, lighted indicators, panels and displays. Our products have been Specialized High-Performance Applications. We specialize in the development of proprietary formulations for silicone rubber
integrated into many existing aircraft designs, including every Boeing commercial aircraft platform currently in production. and other elastomer products. Our elastomer products are engineered to address specific customer requirements where superior
Our large installed base provides us with a significant spare parts and retrofit business. We are a Tier 1 supplier on the Boeing performance in high temperature, high pressure, caustic, abrasive and other difficult environments is critical. These products
787 program to design and manufacture all of the cockpit overhead panels and embedded software for these systems. We include clamping devices, thermal fire barrier insulation products, sealing systems, tubing and coverings designed in custom-
manufacture control sticks, grips and wheels, as well as specialized switching systems. In this area, we primarily serve molded shapes. Some of the products include proprietary elastomers that are specifically designed for use on or near a jet
commercial and military aviation, and airborne and ground-based military equipment manufacturing customers. For example, engine. We are a leading U.S. supplier of high-performance elastomer products to the aerospace industry, with our primary
we are a leading manufacturer of pilot control grips for most types of military fighter jets and helicopters. Additionally, our customers for these products being jet and rocket engine manufacturers, commercial and military airframe manufacturers, as
software engineering center supports our customers’ needs with such applications as primary flight displays, flight well as commercial airlines. In fiscal 2014, some of the largest customers for these products included The Boeing Company,
management systems, air data computers and engine control systems. KAPCO, Lockheed Martin, Northrop Grumman, Spirit AeroSystems, and Wesco Aircraft.
Our proprietary products meet critical operational requirements and provide customers with significant technological We also develop and manufacture high temperature, lightweight metallic insulation systems for aerospace and marine
advantages in such areas as night vision compatibility and active-matrix liquid-crystal displays (a technology enabling pilots to applications. Our commercial aerospace programs include the Boeing 737, A320, and A380 series aircraft and the V2500 and
read display screens in a variety of light conditions as well as from extreme angles). Our products are incorporated in a wide BR710 engines. Our insulation material is used on diesel engine manifolds for earthmoving and agricultural applications. In
variety of platforms ranging from military helicopters, fighters and transports, to commercial wide- and narrow-body, regional addition, we specialize in the development of thermal protection for fire, nuclear, and petro-chemical industries. We design
and business jets. In fiscal 2014, some of our largest customers for these products included Airbus, BAE Systems, The Boeing and manufacture high temperature components for industrial and marine markets. Our manufacturing processes consist of
Company, Hawker Beechcraft, Honeywell, Lockheed Martin, Pilatus Aircraft, Rockwell Collins, Sikorsky, and Thales. cutting, pressing, and welding stainless steel, inconel, and titanium fabrications. In fiscal 2014, some of the largest customers
42 5
of these products included Acktiv Nuclear, Airbus, The Boeing Company, Rolls-Royce, Short Brothers, and Spirit Research and Development PART I
AeIrnodSiycsatteem bsy. c heck mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein,
and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated OuTr hpirso Rduecpto drte vineclolupdmese nat naunmd bdeers iogfn f porrowgarradm-lso ouktiilnizge s atant eemxteenntssi vthea bt arseef loefc tp trhoef eCssoimonpaaln eyn’sg icnuererresn, tt evciehwnisc iwanitsh arnedsp seucpt ptoo rt
Orbdyn arnefceer eanncde C ino uPnatretr ImIIe oafs uthreis A Fpoprlmic a1t0io-Kns o. r Waney d aemveelnodpm aenndt mtoa tnhuisfa Fcoturrme c1o0m-Kb.u s tib le ordnance and warfare countermeasure perfsuotnunree le, vseunptps laenmde fnitneadn bcyia lo uptesrifdoer menagnicnee.e rPinlega saen dre cfeorn stou ltthineg s eficrtmiosn w ahddenre nsseiendge dfo. r wIna frids-claolo 2k0in1g4 ,i nwfoe remxapteinodne odn $ p9a8g.e9 1m0i lfloior n
dev ices for military customers. We manufacture molded fiber cartridge cases, mortar increments, igniter tubes and other forf urerstheaerr cdhi,s cduesvseiloonp.m Ienn tth ains dre epnogritn, e“ewrien,”g ,“ cooumr,”p a“ruesd,” w “iCtho $m9p0a.n2y m,”i lalniodn “ iEn sftiesrclainl e2”0 r1e3f earn tdo $E1s0te0r.l9i nme iTllieocnh nino lfoigscieasl 2012.
KK comInbduicstaitbel eb yo rcdhneacnkc em caorkm wpohneethnetsr tphreim reagriilsytr faonrt tihs ea Ula.rSg. eD aecpcaerltemraetnetd offi lDere, faenn saec.c eSlaerfeatteyd o ffi loeurr, oorp ea rnaotino-nasc icse lae craritteidc afli lfearc. t oSre ien ReCseoarrpcohr aantido nd eavnedl osupbmseidnita erxiepse, nusnel ehsass oatvheerrawgiesde 5n.o0t%ed oofr scaolneste fxotr otthhee trhwriesee yineadrisc aetneds.e d October 31, 2014. We believe EE
0-0- madneuffiancittiuornin ogf o“radcncaenlecrea atendd fciloeur natnedrm laeragseu raecsc, ealnerda atecdc ofirldeirn”g ilny ,R wuele i n1c2obr-p2o oraf tteh ea pEpxlicchaabnleg er eAgcutl.a tory guidance in the design of con tinued product development is key to our long-term growth, and consequently, we consistently invest in research and SS
TT
1 1 our facilities and in the training of our employees. As part of our behavior-based approach to training, employees learn safety- devIetelomp m1.e nBt.u sEinxaesmsp les include research and development projects relating to avionics control panels, A350 engine sensors, EE
MM des igneLda wrgoer ka chcaebleitrsa taendd f pileerrf orm on-going safety audits. We also monitor safeAtycc meleetrraictesd t ofi leenrs ure compliance. We are hig h temperature, low observable material for military applications, and spectral countermeasure flares for military RR
RR cur rentlNyo tnh-ea scocleel esruaptepdli efirl eorf comb (uDsoti nbolte c cheacski nifg as sumtaillliezre rdep boryti nthg ec oUm.pSa.n yA) rmed FSormceasll.e rS raelpeso ratrien gm caodme peaitnhye r direc tly to the U.S. appGliecnaetiroanls D. eWveel oapctmiveenlyt poaf rBtiucispinatees si n customer-funded research and development programs, including applications on C-130 LL
OO II
FF De partment of Defense or through prime contractors, Alliant Techsystems and General Dynamics. These products include the coc kpit upgrades, P-8 aircraft and power systems for the HH-47 Chinook helicopter and A400M. NN
comInbduicstaitbel eb yc acshee fcokr mthaer kU w.Sh. eAthrmery t’hse n reewgi sgterannetr aitsi oan s h1e5l5l mcomm Mpaondyu (laasr dAerftiinlleedry i nC Rhaurlgee 1 S2ybs-2te omf, tthhee E1x2c0hmamng ce oAmcbt)u. s t i b lYe ecsa se Esterline, a Delaware corporation formed in 1967, is a leading specialized manufacturing company principally serving EE
used w i tNh oth e m ain armament system on the U.S. Army and Marine Corps’ M1-A1/2 tanks, and the 60mm, 81mm and 120mm Foareerigonsp Oacpee arnadti odnefse nse customers. We design, manufacture and market highly engineered products and systems for
34
11 com bustible mortar increments. We are one of two suppliers to the U.S. Army of infrared decoy flares used by aircraft to help application within the industries we serve. 2 2
00 pro tect against radar and infrared guided missiles. We are currently the only supplier of radar countermeasures to the U.S. Ou r foreign operations consist of manufacturing facilities located in Canada, China, the Dominican Republic, France, 00
22 Germany, India, Japan, Mexico, Morocco, and the United Kingdom, and include sales and service operations located in Brazil, 11
ArAmsy .o f December 16, 2013, 31,575,039 shares of the Registrant’s common stock were outstanding. The aggregate market Our strategy is to maintain a leadership position in niche markets for the development and manufacture of highly 43
China, and Singapore. For further information regarding foreign operations, see Note 17 to the Consolidated Financial
value of shares of common stock held by non-affiliates as of April 26, 2013, was $2,308,350,938 (based upon the closing engineered products that are essential to our customers. We are concentrating our efforts to expand selectively our
NENE A ssuamlesm parriyc eo fo fp r$o7d3u.8ct6 lpineers s choarnetr)i. buting sales of 10% or more of total sales for fiscal years 2014, 2013, and 2012 is reported in Stactaepmaebniltist iuens dienr t Ihteesme m8 aorfk tehtiss, rteop aonrtti.c ipate the global needs of our customers and to respond to such needs with F F
Note 17 to the Consolidated Financial Statements under Item 8 of this report.
LILI U.Scpo.r omGdpourvceethsr eninnms tiehvnreet es Co klouenytit otrenacsch.t n sO oalunorgd cy uS srurebegncmto enbnuttrssai:n c etAss sv iaonndic sst r&at eCgoicn tgrroolsw, tShe pnlsaonr sf o&c uSsyesst eomn sth, ea ncdo nAtidnvuaonucse dd eMvealtoeprimalesn. t Oofu rth ese OROR
RR Marketing and Distribution MM
EE Documents Incorporated by Reference Asp ar ocdounctrtas catroer oafntden s umbicsosniotrna ccrtoitri ctaol ,t hweh Uic.hS .h gaovvee brenemne dnet s(ipgrnimeda riniltyo tphaer tUic.Sul.a Dr empialirttamrye natn odf cDoemfemnesrec)i,a wl pe laartfeo srumbsj eacntd t oin
TT We believe that a key to continued success is our ability to meet customer requirements both domestically and internationally. varcieorutsa ilna wcass aens dc areng ounlalyti obnes r ethpalat caerde mbyo prer ordesutcrtisc toivf eo tthhaern mthaonsuef aapctpulricearsb lfeo ltloo wpriinvga tae fsoercmtoarl ccoenrttirfaicctaotiros.n Aprpopcreosxs.i m Aaste plya r4t %of of 1010
ESES WeP ahratv IeI Ia inndc owriplol rcaotnesti ninufeo trom iamtiporno bvye roeufre rweonrcled -tow itdhee sreagleiss taranndt ’dsi sdterifbinuittiiovne cphroanxnye sltsa itnem oerdnet,r ttoo bper ofviliedde wwiitdhe trh me aSrekceutr ities ouro usarl iems pwlaesm menatdaeti odnir eocft lthy itso g trhoew Uth.S p.l gano,v weren mfoecnuts ionn f iesxcpala n2s0i1o4n. o Ifn o audr dciatipoanb,i wliteie ess atism aa mte otrhea tc oomurp sruebhceonnsitvraec stiunpgp alicetri vtoit ioeus rt o -K-K
covaenrda gEex acnhdan tgoe i mCopmromvei stshieo ne fwfeicthtiivne 1n2e0ss d oafy os uarf tceurs tthoem celross’e s oufp pthlye fcihsacianl .y eFaorr eenxdaemdp Olec,t oobuer rm 2e5d, i2c0al1 d3e. vice assembly conctursatcotmoresr fso. r Sthuec hU e.Sxp. agnosvieornn minecnlut daecdc othuen tFeedb froura aryp p4r,o 2x0im13a,t ealcyq u1i4s%iti oonf soafl ethse d Guraimnge sfimscaanl G20ro1u4p. (IGn atomtaels,m waen e),s twimhiacthe itsh aat
operation in Shanghai, China, serves our global medical custome rs, our service center in Singapore im proves our capabilities in appgrlooxbiaml asuteplpyl i1e8r% of o ifn pouutr dsaelveisc edsu prirningc tihpea lfliys csaelr vyienagr wthaes g saumbjiencgt itnod Uus.Str.y g; othvee rJnumlye 2nt6 ,c o2n0t1r1a,c taicnqgu riesigtuiolant ioofn tsh. e SSuocuhr icaoun Gtrraocutsp
(Souriau), which is a leading global supplier of highly engineered connection technologies for harsh environments; and the
Asia for our temperature sensor customers, and our marketing representative office in Bangalore, India, facilitates marketing may be subject to termination, reduction or modification in the event of changes in government requirements, reductions in
December 30, 2010, acquisition of Eclipse Electronic Systems, Inc. (Eclipse), which develops and manufactures embedded
opportunities in India. Other enhancements include combining sales and marketing forces of our operating units where federal spending, and other factors.
communication intercept receivers for signal intelligence applications. These acquisitions are described in more detail in
appropriate, cross-training our sales representatives on multiple product lines, and cross-stocking our spares and components.
Histhtoer i“cOalvleyr, voiuerw U” .sSe.c gtioovne ornf mMeannt acgoenmtreanctt’ss a Dndis csuubsscioonnt raancdts A hnaavley sbiese onf pFriendaonmciianla Cteolyn dfiitxieodn- panridc eR ceosuntlrtsa cotfs .C Gonetnineurainllgy , fixed-
In the technical and highly engineered product segments in which we compete, relationship selling is particularly appropriate in priOcep ceoranttiroancst sc oofnfteari nheigdh ienr Imteamrg 7in osf tthhains rceopsot-rpt.l us contracts in return for accepting the risk that increased or unexpected costs
targeted marketing segments where customer and supplier design and engineering inputs need to be tightly integrated. ma y reduce anticipated profits or cause us to sustain losses on the contracts. The accuracy and appropriateness of certain costs
Participation in industry trade shows is an effective method of meeting customers, introducing new products, and exchanging andO euxrp pernosdeusc utss ehda vtoe sau lbosntgan htiiasttoer oyu irn d tihree cate arondsp iancdei raencdt cdoesftesn fsoer itnhdeu Ust.rSy. agnodv aerren mfoeunnt du ondn emr obsott hm ciloistat-rpyl uasn da ncdo mfixmeedr-cpirailc e
technical specifications. In addition to technical and industry conferences, our products are supported through direct internal conatirraccratsf ta, rhee sliucbojpetcetr tso, aenxdte lnasnidve-b raesgeudl astyiostne mansd. aFuodri et xbaym thpele D, oeufern psreo Cduocnttsr aacrte Ausueddi to Ang tehnec my,a ajonr iatrym o fo fa cthtiev eU a.Sn.d D ine-partment
international sales efforts, as well as through manufacturer representatives and selected distributors. As of October 31, 2014, of pDreofdeuncstei.o nT Uhe.S c.o mntirlaitcatrsy a anidrc sruabftc aonndtr aocnt se vtoe rwy hBicohe iwnge caorem am pearrctiya la raeir aclrsaoft spulbajtefoctr mto mpraonfuitf aacntdu rceods ti nc othnetr oplass ta n7d5 syteaanrdsa. r Idn
382 sales people, 324 representatives, and 306 distributors supported our operations internationally. proavdidsiiotinosn ,f ooru tre prmroidnuactitos na raet sthuep pcloiendv etnoi Aenicrbeu osf, tmhea nUy. So.f gthoev emrnajmoer nret.g iUonpaoln a tnedrm biunsaintieosns, joetth mera tnhuafna cftourr eorusr, daenfda uthlte, mwea jwori ll
noramiraclrlayf tb een egnintietl emda tnou rfeaicmtubruerrss.e m Ween tw foorr ka lclloowsealbyl ew cioths tOs EanMd st oo na nn eawllo, whiagnhcley feonrg pinroefeirte. d T por oddautec,t sn ownieth o tfh oeu orb mjeactteivriea lo ffi xsuecdh-
Backlog pripcero cdouncttrsa cbtesc hoams ibnege dne tseirgmneinda itnetdo. o ur customers’ platforms; this integration often results in sole-source positions for OEM
production and aftermarket business. We broadly categorize our commercial and military aerospace aftermarket sales as
Backlog was $1.1 billion at October 31, 2014, and $1.2 billion at October 25, 2013. We estimate that approximately Wer eatrreo fsiut,b rjeepcat itro s Uer.vSi.c eexs,p aonrtd l aspwasr ea npda rrtesg. u Slaptaioren sp,a irntsc lauldoinneg m ITaAdeR u, pth aapt pgreonxeirmaalltye lrye s1t0ri%ct othf et oetxapl osratl eosf idne ffiesncsael p2r0o1d3u. c ts,
$303.5 million of backlog is scheduled to be shipped after fiscal 2015. tecRhneitcroafl idt aatnad, arenpda dire fseenrvseic seesr, vwicheisc.h Orenp rMesaerncth 5 5%, 2 o0f1 t4o,t athl es aCleosm, cpaarnryy ehnigtehreerd m inatrog ian sC tohnasne nOt EAMgr seaelmese,n bt uwt iltohw there mDaTrCgiCn st o
restohlavne sapllaergee pda IrTtsA sRal ecsi.v iIl nv mioalantyio cnass. e sT,h oeu Cr aofntseermnta Arkgerte seamleesn st psaentt ltehde tehnet ipreen ldifien go fI TanA aRi rccoramftp. liance matter with the DTCC
Backlog is subject to cancellation until delivered, and therefore, we cannot assure that our backlog will be converted into pre viously reported by the Company that resulted from voluntary reports the Company filed with DTCC that disclosed possible
revenue in any particular period or at all. Backlog does not include the total contract value of cost-plus reimbursable contracts, tecWhneic dailf faenrde natdiamtein oisutrrsaetlivvees v tihorloautigohn so oufr tehneg iInTeAerRin. g T ahned C moannsuenfat cAtugrrienegm ceanpta hbailsi taie tsh arened- yoeuarr r teeprumta atinodn pfroorv siadfeest yf,o qr:u a(lii)t ya,
which are funded as we incur the costs. Except for the released portion, backlog also does not include fixed-price multi-year payomn-etnimt oe fd $e2li0v emryil,l iroenli,a $b1il0it ym, iallniod ni nonfo wvahtiicohn i –s saulls peemnbdoeddi eadn din e tlhigei bElset eforlri noef fPseetr fcorremdiatn bcaes eSdy sotnem ve, roiufire wd aeyx poefn adpitpurroeasc fhoinr gp ast
contracts. andb ufusitnueres sr ethmaet dhieallp cso emnspuliraen aclel emmeapslouyreese;s ( aiir)e t hfoec aupspedo ionntm ceonntt ionfu aonu se ximteprnroavl eSmpeecnita. l SCaofmetpyl ioafn ocuer O ofpfeicraiatilo tnos o ivse ar scereit ical
comfapcltioarn icne owuirt hb uthsein Cesosn, saenndt aAcgcroeredminegnlty a, nwde tihnec oITrpAoRra;t e(i iaip) ptwlicoa ebxlete rrengaul laautodriyts goufi dthaen cCeo imn pthane yd’ess IiTgnA oRf cooumr fpalciailnictiee sp raongdr am;
Competition andtr a(iivn) ocuorn etimnupelody iemeps luesminegn taa tbioehna ovfi oorn-gboasinegd raepmpreodaicahl ctohmat pfloicaunscees m oena ssaufreetsy -adneds iagdndeidti ownoarlk r ehmabeidtsia al ncdo monp-lgiaoninceg msaefaestyu res
relaatueddi ttso. aOuutorm inadteuds tsriyesst eamres haingdh lIyT rAeRgu claotmedp,l iaanndc ec opmolpicliiaens,c ep rwocitehd auprepsli, caanbdle t rraeignuinlagt.i o ns, including export control and anti-
Our products and services are affected by varying degrees of competition. We compete with other companies in most markets
bribery regulations, is an important focus in our business. For example, we have a global code of business conduct and
we serve. Many of these companies have far greater sales volumes and financial resources than we do. Some of our
Theet hseicttsl etmhaetn cto avmerosu cnot minp tlhiaen Cceo nwsietnht l Aawgsre, eamnde nwt ew parso cvoidnesdis ttreanitn winigth o tnh eth aism cooudnet tpor oopuor swedo rbldyw DidTeC eCm ipnl oAyuegeuss itn 2 f0is1c3a,l f 2o0r 13.
competitors are also our customers on certain programs. The principal competitive factors in the commercial markets in which
whIinc ha dthdeit iCoonm, wpaen my aeisnttiamina tleodc aaln edt hreiccso raddevdi sao r$s1 a0n md iellxipoonr ct hcaorngtero iln s tpheec fiaislcisatls qinu aoruterr b eunsdineeds Jsu ulyn i2ts6 t,o 2 s0u1p3p. o Trth oeu $r1 c0o mmpillliiaonnc e
we participate are product performance, on-time delivery, service and price. Part of product performance requires expenditures
poretfifoonr tosf. t he settlement that is not subject to suspension will be paid in installments, with $4 million paid in March 2014, and
in research and development that lead to product improvement. The market for many of our products may be affected by rapid
$2 million to be paid in each of March 2015, 2016, and 2017. The Company expects that some part of recent investments
and significant technological changes and new product introductions. Our principal competitors include Astronautics, BAE,
maOdeu ri ns aoluers IaTreA dRiv ceormsifpileidan accer opsrso gthrraeme bwriolla db em ealrigkiebtlse: fdoerf cernesdei,t caogmaimnsetr tchiael sauesrpoesnpdaecde, paonrdti ognen oefr athl ein sdeuttsltermiael.n tF aomr ofiusncat,l
Bose, Eaton, Elbit, EMS, GE Aerospace, Honeywell, IAI, L-3, Otto Controls, RAFI, Rockwell Collins, SELEX, Telephonics,
wh2ic0h1 3in, calpupdreo:x iamddatiteiloyn 3a5l %sta offfi nogu,r osnalgeosi nwge rime fprloemm ethneta dtieofne nosfe a m naerwk esto, f4tw5%ar ef rsoymst ethme, ceommpmloeyreceia tlr aaienrionsgp,a acned m easrtkabetl,i sahnmd e2n0t% of
Thales, Ultra Electronics, Universal Avionics Systems Corporation, and Zodiac in our Avionics & Controls segment; Ametek,
a refrgoumla rt hceo mgepnleiaranlc ien aduudsittr iparlo mgraarmke ta.n d corrective action process. The Company expects recent and future investments in
Amphenol, Eaton, Goodrich, Hamilton Sundstrand, Meggitt, STPI-Deutsch, TE Connectivity, and Zodiac in our Sensors &
rem edial compliance measures will be sufficient to cover the $10 million suspended payment.
Systems segment; and Chemring, Doncasters, Hi-Temp, J&M, JPR Hutchinson, Kmass, Meggitt (including Dunlop Standard

Aerospace Group), Rheinmetall, Trelleborg, ULVA, UMPCO, and Woodward Products in our Advanced Materials segment.
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