SEC Info - Teledyne Technologies Inc. - ‘10-Q’ for 9/27/20

Page	(sequential)		(alphabetic)	↑Top
		Alternative Formats (Word, et al.) Condensed Consolidated Balance Sheets Condensed Consolidated Statements of Cash Flows Condensed Consolidated Statements of Comprehensive Income Condensed Consolidated Statements of Income Condensed Consolidated Statements of Stockholders' Equity Controls and Procedures Exhibits Financial Information Financial Statements Management's Discussion and Analysis of Financial Condition and Results of Operations Notes to Condensed Consolidated Financial Statements Other Information Quantitative and Qualitative Disclosures About Market Risk Risk Factors Signatures Table of Contents
1	1st Page – Filing Submission
"	Table of Contents
"	Financial Information
"	Item 1. Financial Statements
"	Condensed Consolidated Statements of Income
"	Condensed Consolidated Statements of Comprehensive Income
"	Condensed Consolidated Balance Sheets
"	Condensed Consolidated Statements of Stockholders' Equity
"	Condensed Consolidated Statements of Cash Flows
"	Notes to Condensed Consolidated Financial Statements
"	Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
"	Item 3. Quantitative and Qualitative Disclosures About Market Risk
"	Item 4. Controls and Procedures
"	Other Information
"	Item 1A. Risk Factors
"	Item 6. Exhibits
"	Signatures

i false i 2020 i Q3 i 0001094285 i --01-03 i P3Y i P3Y i 1.50 i 1.75 i P1Y i 00010942852019-12-302020-09-27xbrli:shares00010942852020-10-20iso4217:USD00010942852020-06-292020-09-2700010942852019-07-012019-09-2900010942852018-12-312019-09-29iso4217:USDxbrli:shares00010942852020-09-2700010942852019-12-290001094285us-gaap:CommonStockMember2019-12-290001094285us-gaap:AdditionalPaidInCapitalMember2019-12-290001094285us-gaap:TreasuryStockMember2019-12-290001094285us-gaap:RetainedEarningsMember2019-12-290001094285us-gaap:AccumulatedOtherComprehensiveIncomeMember2019-12-290001094285us-gaap:RetainedEarningsMember2019-12-302020-03-2900010942852019-12-302020-03-290001094285us-gaap:AccumulatedOtherComprehensiveIncomeMember2019-12-302020-03-290001094285us-gaap:AdditionalPaidInCapitalMember2019-12-302020-03-290001094285us-gaap:TreasuryStockMember2019-12-302020-03-290001094285us-gaap:CommonStockMember2020-03-290001094285us-gaap:AdditionalPaidInCapitalMember2020-03-290001094285us-gaap:TreasuryStockMember2020-03-290001094285us-gaap:RetainedEarningsMember2020-03-290001094285us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-03-2900010942852020-03-290001094285us-gaap:RetainedEarningsMember2020-03-302020-06-2800010942852020-03-302020-06-280001094285us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-03-302020-06-280001094285us-gaap:AdditionalPaidInCapitalMember2020-03-302020-06-280001094285us-gaap:TreasuryStockMember2020-03-302020-06-280001094285us-gaap:CommonStockMember2020-06-280001094285us-gaap:AdditionalPaidInCapitalMember2020-06-280001094285us-gaap:TreasuryStockMember2020-06-280001094285us-gaap:RetainedEarningsMember2020-06-280001094285us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-06-2800010942852020-06-280001094285us-gaap:RetainedEarningsMember2020-06-292020-09-270001094285us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-06-292020-09-270001094285us-gaap:AdditionalPaidInCapitalMember2020-06-292020-09-270001094285us-gaap:TreasuryStockMember2020-06-292020-09-270001094285us-gaap:CommonStockMember2020-09-270001094285us-gaap:AdditionalPaidInCapitalMember2020-09-270001094285us-gaap:TreasuryStockMember2020-09-270001094285us-gaap:RetainedEarningsMember2020-09-270001094285us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-09-270001094285us-gaap:CommonStockMember2018-12-300001094285us-gaap:AdditionalPaidInCapitalMember2018-12-300001094285us-gaap:TreasuryStockMember2018-12-300001094285us-gaap:RetainedEarningsMember2018-12-300001094285us-gaap:AccumulatedOtherComprehensiveIncomeMember2018-12-3000010942852018-12-300001094285us-gaap:RetainedEarningsMember2018-12-312019-03-3100010942852018-12-312019-03-310001094285us-gaap:AccumulatedOtherComprehensiveIncomeMember2018-12-312019-03-310001094285us-gaap:AdditionalPaidInCapitalMember2018-12-312019-03-310001094285us-gaap:TreasuryStockMember2018-12-312019-03-310001094285us-gaap:CommonStockMember2019-03-310001094285us-gaap:AdditionalPaidInCapitalMember2019-03-310001094285us-gaap:TreasuryStockMember2019-03-310001094285us-gaap:RetainedEarningsMember2019-03-310001094285us-gaap:AccumulatedOtherComprehensiveIncomeMember2019-03-3100010942852019-03-310001094285us-gaap:RetainedEarningsMember2019-04-012019-06-3000010942852019-04-012019-06-300001094285us-gaap:AccumulatedOtherComprehensiveIncomeMember2019-04-012019-06-300001094285us-gaap:AdditionalPaidInCapitalMember2019-04-012019-06-300001094285us-gaap:TreasuryStockMember2019-04-012019-06-300001094285us-gaap:CommonStockMember2019-06-300001094285us-gaap:AdditionalPaidInCapitalMember2019-06-300001094285us-gaap:TreasuryStockMember2019-06-300001094285us-gaap:RetainedEarningsMember2019-06-300001094285us-gaap:AccumulatedOtherComprehensiveIncomeMember2019-06-3000010942852019-06-300001094285us-gaap:RetainedEarningsMember2019-07-012019-09-290001094285us-gaap:AccumulatedOtherComprehensiveIncomeMember2019-07-012019-09-290001094285us-gaap:AdditionalPaidInCapitalMember2019-07-012019-09-290001094285us-gaap:TreasuryStockMember2019-07-012019-09-290001094285us-gaap:CommonStockMember2019-09-290001094285us-gaap:AdditionalPaidInCapitalMember2019-09-290001094285us-gaap:TreasuryStockMember2019-09-290001094285us-gaap:RetainedEarningsMember2019-09-290001094285us-gaap:AccumulatedOtherComprehensiveIncomeMember2019-09-2900010942852019-09-290001094285us-gaap:AccumulatedTranslationAdjustmentMember2020-06-280001094285us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2020-06-280001094285us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2020-06-280001094285us-gaap:AccumulatedTranslationAdjustmentMember2020-06-292020-09-270001094285us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2020-06-292020-09-270001094285us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2020-06-292020-09-270001094285us-gaap:AccumulatedTranslationAdjustmentMember2020-09-270001094285us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2020-09-270001094285us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2020-09-270001094285us-gaap:AccumulatedTranslationAdjustmentMember2019-06-300001094285us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2019-06-300001094285us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2019-06-300001094285us-gaap:AccumulatedTranslationAdjustmentMember2019-07-012019-09-290001094285us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2019-07-012019-09-290001094285us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2019-07-012019-09-290001094285us-gaap:AccumulatedTranslationAdjustmentMember2019-09-290001094285us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2019-09-290001094285us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2019-09-290001094285us-gaap:AccumulatedTranslationAdjustmentMember2019-12-290001094285us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2019-12-290001094285us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2019-12-290001094285us-gaap:AccumulatedTranslationAdjustmentMember2019-12-302020-09-270001094285us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2019-12-302020-09-270001094285us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2019-12-302020-09-270001094285us-gaap:AccumulatedTranslationAdjustmentMember2018-12-300001094285us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2018-12-300001094285us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2018-12-300001094285us-gaap:AccumulatedTranslationAdjustmentMember2018-12-312019-09-290001094285us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember2018-12-312019-09-290001094285us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2018-12-312019-09-290001094285us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2020-06-292020-09-270001094285us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2019-07-012019-09-290001094285us-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetPriorServiceCostCreditMember2020-06-292020-09-270001094285us-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetPriorServiceCostCreditMember2019-07-012019-09-290001094285us-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetUnamortizedGainLossMember2020-06-292020-09-270001094285us-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetUnamortizedGainLossMember2019-07-012019-09-290001094285us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2019-12-302020-09-270001094285us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2018-12-312019-09-290001094285us-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetPriorServiceCostCreditMember2019-12-302020-09-270001094285us-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetPriorServiceCostCreditMember2018-12-312019-09-290001094285us-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetUnamortizedGainLossMember2019-12-302020-09-270001094285us-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetUnamortizedGainLossMember2018-12-312019-09-290001094285tdy:OakGateTechnologyMember2020-01-052020-01-050001094285tdy:MicralyneIncMember2019-08-302019-08-300001094285tdy:MicralyneIncMember2020-01-012020-01-310001094285tdy:A3MGasAndFlameDetectionBusinessMember2019-08-012019-08-010001094285tdy:RoperTechnologiesIncMember2019-02-052019-02-050001094285us-gaap:ForeignExchangeForwardMemberus-gaap:DesignatedAsHedgingInstrumentMember2020-09-270001094285us-gaap:DesignatedAsHedgingInstrumentMembertdy:CurrencySwapAndInterestRateSwapMember2020-09-270001094285us-gaap:ForeignExchangeForwardMemberus-gaap:DesignatedAsHedgingInstrumentMembertdy:SellUsDollarsAndBuyCanadianDollarsMember2020-09-270001094285tdy:SellUsDollarsAndBuyGreatBritainPoundsMemberus-gaap:ForeignExchangeForwardMemberus-gaap:DesignatedAsHedgingInstrumentMember2020-09-27iso4217:EUR0001094285us-gaap:DesignatedAsHedgingInstrumentMembertdy:CurrencySwapMaturingMarch2023Member2020-09-270001094285us-gaap:DesignatedAsHedgingInstrumentMembertdy:CurrencySwapMaturingOctober2024Member2020-09-270001094285us-gaap:InterestRateSwapMemberus-gaap:DesignatedAsHedgingInstrumentMember2020-09-270001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2020-06-292020-09-270001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2019-07-012019-09-290001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2019-12-302020-09-270001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMember2018-12-312019-09-290001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMemberus-gaap:SalesMemberus-gaap:ForeignExchangeContractMember2020-06-292020-09-270001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMemberus-gaap:SalesMemberus-gaap:ForeignExchangeContractMember2019-07-012019-09-290001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMemberus-gaap:SalesMemberus-gaap:ForeignExchangeContractMember2019-12-302020-09-270001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMemberus-gaap:SalesMemberus-gaap:ForeignExchangeContractMember2018-12-312019-09-290001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateContractMemberus-gaap:CashFlowHedgingMember2020-06-292020-09-270001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateContractMemberus-gaap:CashFlowHedgingMember2019-07-012019-09-290001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateContractMemberus-gaap:CashFlowHedgingMember2019-12-302020-09-270001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateContractMemberus-gaap:CashFlowHedgingMember2018-12-312019-09-290001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:OtherOperatingIncomeExpenseMemberus-gaap:CashFlowHedgingMemberus-gaap:ForeignExchangeContractMember2020-06-292020-09-270001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:OtherOperatingIncomeExpenseMemberus-gaap:CashFlowHedgingMemberus-gaap:ForeignExchangeContractMember2019-07-012019-09-290001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:OtherOperatingIncomeExpenseMemberus-gaap:CashFlowHedgingMemberus-gaap:ForeignExchangeContractMember2019-12-302020-09-270001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:OtherOperatingIncomeExpenseMemberus-gaap:CashFlowHedgingMemberus-gaap:ForeignExchangeContractMember2018-12-312019-09-290001094285us-gaap:InterestExpenseMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMemberus-gaap:ForeignExchangeContractMember2020-06-292020-09-270001094285us-gaap:InterestExpenseMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMemberus-gaap:ForeignExchangeContractMember2019-07-012019-09-290001094285us-gaap:InterestExpenseMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMemberus-gaap:ForeignExchangeContractMember2019-12-302020-09-270001094285us-gaap:InterestExpenseMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:CashFlowHedgingMemberus-gaap:ForeignExchangeContractMember2018-12-312019-09-290001094285us-gaap:InterestExpenseMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateContractMemberus-gaap:CashFlowHedgingMember2020-06-292020-09-270001094285us-gaap:InterestExpenseMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateContractMemberus-gaap:CashFlowHedgingMember2019-07-012019-09-290001094285us-gaap:InterestExpenseMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateContractMemberus-gaap:CashFlowHedgingMember2019-12-302020-09-270001094285us-gaap:InterestExpenseMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateContractMemberus-gaap:CashFlowHedgingMember2018-12-312019-09-29iso4217:CAD0001094285us-gaap:ForeignExchangeForwardMemberus-gaap:NondesignatedMemberus-gaap:LongMembertdy:SellUsDollarsAndBuyCanadianDollarsMember2020-09-270001094285us-gaap:ForeignExchangeForwardMemberus-gaap:NondesignatedMemberus-gaap:ShortMembertdy:SellUsDollarsAndBuyCanadianDollarsMember2020-09-270001094285us-gaap:ForeignExchangeForwardMemberus-gaap:NondesignatedMemberus-gaap:LongMembertdy:SellEurosandBuyCanadianDollarsMember2020-09-270001094285us-gaap:ForeignExchangeForwardMemberus-gaap:NondesignatedMemberus-gaap:ShortMembertdy:SellEurosandBuyCanadianDollarsMember2020-09-27iso4217:GBP0001094285tdy:SellUsDollarsAndBuyGreatBritainPoundsMemberus-gaap:ForeignExchangeForwardMemberus-gaap:NondesignatedMemberus-gaap:LongMember2020-09-270001094285tdy:SellUsDollarsAndBuyGreatBritainPoundsMemberus-gaap:ForeignExchangeForwardMemberus-gaap:NondesignatedMemberus-gaap:ShortMember2020-09-270001094285us-gaap:ForeignExchangeForwardMemberus-gaap:NondesignatedMembertdy:SellUSDollarsandBuyEurosMemberus-gaap:LongMember2020-09-270001094285us-gaap:ForeignExchangeForwardMemberus-gaap:NondesignatedMemberus-gaap:ShortMembertdy:SellUSDollarsandBuyEurosMember2020-09-27iso4217:DKK0001094285us-gaap:ForeignExchangeForwardMemberus-gaap:NondesignatedMembertdy:SellUSDollarsAndBuyDanishKroneMemberMemberus-gaap:LongMember2020-09-270001094285us-gaap:ForeignExchangeForwardMemberus-gaap:NondesignatedMembertdy:SellUSDollarsAndBuyDanishKroneMemberMemberus-gaap:ShortMember2020-09-270001094285us-gaap:ForeignExchangeForwardMemberus-gaap:NondesignatedMembertdy:SellEurosAndBuyGreatBritishPoundsMemberus-gaap:LongMember2020-09-270001094285us-gaap:ForeignExchangeForwardMemberus-gaap:NondesignatedMemberus-gaap:ShortMembertdy:SellEurosAndBuyGreatBritishPoundsMember2020-09-270001094285us-gaap:NondesignatedMember2020-06-292020-09-270001094285us-gaap:NondesignatedMember2019-12-302020-09-270001094285us-gaap:NondesignatedMember2019-07-012019-09-290001094285us-gaap:NondesignatedMember2018-12-312019-09-290001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:OtherAssetsMemberus-gaap:ForeignExchangeContractMember2020-09-270001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:OtherAssetsMemberus-gaap:ForeignExchangeContractMember2019-12-290001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:AccruedLiabilitiesMemberus-gaap:ForeignExchangeContractMember2020-09-270001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:AccruedLiabilitiesMemberus-gaap:ForeignExchangeContractMember2019-12-290001094285tdy:CashFlowCrossCurrencySwapMemberus-gaap:OtherCurrentAssetsMemberus-gaap:DesignatedAsHedgingInstrumentMember2020-09-270001094285tdy:CashFlowCrossCurrencySwapMemberus-gaap:OtherCurrentAssetsMemberus-gaap:DesignatedAsHedgingInstrumentMember2019-12-290001094285tdy:CashFlowCrossCurrencySwapMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:AccruedLiabilitiesMember2020-09-270001094285tdy:CashFlowCrossCurrencySwapMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:AccruedLiabilitiesMember2019-12-290001094285tdy:CashFlowCrossCurrencySwapMemberus-gaap:OtherNoncurrentLiabilitiesMemberus-gaap:DesignatedAsHedgingInstrumentMember2020-09-270001094285tdy:CashFlowCrossCurrencySwapMemberus-gaap:OtherNoncurrentLiabilitiesMemberus-gaap:DesignatedAsHedgingInstrumentMember2019-12-290001094285us-gaap:OtherCurrentAssetsMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateContractMember2020-09-270001094285us-gaap:OtherCurrentAssetsMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateContractMember2019-12-290001094285us-gaap:OtherNoncurrentAssetsMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateContractMember2020-09-270001094285us-gaap:OtherNoncurrentAssetsMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateContractMember2019-12-290001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateContractMemberus-gaap:OtherCurrentLiabilitiesMember2020-09-270001094285us-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateContractMemberus-gaap:OtherCurrentLiabilitiesMember2019-12-290001094285us-gaap:OtherNoncurrentLiabilitiesMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateContractMember2020-09-270001094285us-gaap:OtherNoncurrentLiabilitiesMemberus-gaap:DesignatedAsHedgingInstrumentMemberus-gaap:InterestRateContractMember2019-12-290001094285us-gaap:DesignatedAsHedgingInstrumentMember2020-09-270001094285us-gaap:DesignatedAsHedgingInstrumentMember2019-12-290001094285us-gaap:OtherCurrentAssetsMemberus-gaap:NondesignatedMemberus-gaap:ForeignExchangeContractMember2020-09-270001094285us-gaap:OtherCurrentAssetsMemberus-gaap:NondesignatedMemberus-gaap:ForeignExchangeContractMember2019-12-290001094285us-gaap:NondesignatedMemberus-gaap:AccruedLiabilitiesMemberus-gaap:ForeignExchangeContractMember2020-09-270001094285us-gaap:NondesignatedMemberus-gaap:AccruedLiabilitiesMemberus-gaap:ForeignExchangeContractMember2019-12-290001094285us-gaap:NondesignatedMember2020-09-270001094285us-gaap:NondesignatedMember2019-12-290001094285us-gaap:EmployeeStockOptionMembertdy:EmployeeMember2019-12-302020-09-270001094285srt:ScenarioForecastMember2019-12-302021-01-03xbrli:pure0001094285us-gaap:EmployeeStockOptionMember2019-12-302020-09-270001094285tdy:EmployeeandNonEmployeeStockOptionMember2020-06-280001094285tdy:EmployeeandNonEmployeeStockOptionMember2019-12-290001094285tdy:EmployeeandNonEmployeeStockOptionMember2020-06-292020-09-270001094285tdy:EmployeeandNonEmployeeStockOptionMember2019-12-302020-09-270001094285tdy:EmployeeandNonEmployeeStockOptionMember2020-09-270001094285us-gaap:PerformanceSharesMember2019-12-302020-03-290001094285us-gaap:PerformanceSharesMember2018-12-312019-03-310001094285us-gaap:PerformanceSharesMember2018-01-012018-04-010001094285us-gaap:PerformanceSharesMembersrt:MaximumMember2020-09-270001094285us-gaap:RestrictedStockMember2019-12-290001094285us-gaap:RestrictedStockMember2019-12-302020-09-270001094285us-gaap:RestrictedStockMember2020-09-270001094285srt:MinimumMember2019-12-302020-09-270001094285srt:MaximumMember2019-12-302020-09-270001094285tdy:DigitalImagingMember2019-12-302020-09-270001094285tdy:DigitalImagingMember2018-12-312019-09-2900010942852020-09-282020-09-2700010942852021-09-282020-09-2700010942852021-06-282020-09-270001094285us-gaap:RevolvingCreditFacilityMemberus-gaap:LineOfCreditMember2019-12-290001094285us-gaap:RevolvingCreditFacilityMemberus-gaap:LineOfCreditMember2020-09-270001094285us-gaap:LoansPayableMembertdy:UnsecuredTermLoanDueOctober2024Member2020-09-270001094285us-gaap:LoansPayableMembertdy:UnsecuredTermLoanDueOctober2024Member2019-12-290001094285tdy:UnsecuredSeniorNotesDueSeptemberFifteenTwoThousandTwentyMemberMemberus-gaap:SeniorNotesMember2020-09-270001094285tdy:UnsecuredSeniorNotesDueSeptemberFifteenTwoThousandTwentyMemberMemberus-gaap:SeniorNotesMember2019-12-290001094285us-gaap:SeniorNotesMembertdy:SeniorUnsecuredNotes2.81DueNovember52020Member2020-09-270001094285us-gaap:SeniorNotesMembertdy:SeniorUnsecuredNotes2.81DueNovember52020Member2019-12-290001094285us-gaap:SeniorNotesMembertdy:SeniorUnsecuredNotesDueDecember62021Member2020-09-270001094285us-gaap:SeniorNotesMembertdy:SeniorUnsecuredNotesDueDecember62021Member2019-12-290001094285us-gaap:SeniorNotesMembertdy:A3.28percentUnsecuredSeniorNotesDueNovember2022Member2020-09-270001094285us-gaap:SeniorNotesMembertdy:A3.28percentUnsecuredSeniorNotesDueNovember2022Member2019-12-290001094285tdy:A0.70UnsecuredSeniorNotesdueApril2022Memberus-gaap:SeniorNotesMember2020-09-270001094285tdy:A0.70UnsecuredSeniorNotesdueApril2022Memberus-gaap:SeniorNotesMember2019-12-290001094285us-gaap:SeniorNotesMembertdy:A0.92UnsecuredSeniorNotesdueApril2023Member2020-09-270001094285us-gaap:SeniorNotesMembertdy:A0.92UnsecuredSeniorNotesdueApril2023Member2019-12-290001094285us-gaap:SeniorNotesMembertdy:A1.09UnsecuredSeniorNotesdueApril2024Member2020-09-270001094285us-gaap:SeniorNotesMembertdy:A1.09UnsecuredSeniorNotesdueApril2024Member2019-12-290001094285tdy:OtherUnsecuredDebtDueThrough2018Member2020-09-270001094285tdy:OtherUnsecuredDebtDueThrough2018Member2019-12-290001094285us-gaap:LineOfCreditMemberus-gaap:LetterOfCreditMember2020-09-270001094285us-gaap:LetterOfCreditMember2020-09-270001094285us-gaap:ReserveForEnvironmentalCostsMember2020-09-27tdy:numberOfPlans0001094285us-gaap:QualifiedPlanMember2020-01-010001094285us-gaap:QualifiedPlanMembertdy:RetirementPlanActiveParticipantsMember2020-01-010001094285us-gaap:QualifiedPlanMembertdy:RetirementPlanInactiveParticipantsMember2020-01-010001094285us-gaap:QualifiedPlanMembertdy:RetirementPlanInactiveParticipantsMember2019-12-302020-09-270001094285country:US2020-09-270001094285country:US2019-12-290001094285us-gaap:PensionPlansDefinedBenefitMember2020-06-292020-09-270001094285us-gaap:PensionPlansDefinedBenefitMember2019-07-012019-09-290001094285us-gaap:PensionPlansDefinedBenefitMember2019-12-302020-09-270001094285us-gaap:PensionPlansDefinedBenefitMember2018-12-312019-09-29tdy:segment0001094285tdy:EmployeeSeveranceAndFacilityConsolidationMember2020-06-292020-09-270001094285tdy:EmployeeSeveranceAndFacilityConsolidationMember2019-12-302020-09-270001094285tdy:EmployeeSeveranceAndFacilityConsolidationMember2019-07-012019-09-290001094285tdy:EmployeeSeveranceAndFacilityConsolidationMember2018-12-312019-09-290001094285tdy:EmployeeSeveranceAndFacilityConsolidationMember2020-09-270001094285tdy:InstrumentationMemberus-gaap:OperatingSegmentsMember2020-06-292020-09-270001094285tdy:InstrumentationMemberus-gaap:OperatingSegmentsMember2019-07-012019-09-290001094285tdy:InstrumentationMemberus-gaap:OperatingSegmentsMember2019-12-302020-09-270001094285tdy:InstrumentationMemberus-gaap:OperatingSegmentsMember2018-12-312019-09-290001094285tdy:DigitalImagingMemberus-gaap:OperatingSegmentsMember2020-06-292020-09-270001094285tdy:DigitalImagingMemberus-gaap:OperatingSegmentsMember2019-07-012019-09-290001094285tdy:DigitalImagingMemberus-gaap:OperatingSegmentsMember2019-12-302020-09-270001094285tdy:DigitalImagingMemberus-gaap:OperatingSegmentsMember2018-12-312019-09-290001094285us-gaap:OperatingSegmentsMembertdy:AerospaceAndDefenseElectronicsMember2020-06-292020-09-270001094285us-gaap:OperatingSegmentsMembertdy:AerospaceAndDefenseElectronicsMember2019-07-012019-09-290001094285us-gaap:OperatingSegmentsMembertdy:AerospaceAndDefenseElectronicsMember2019-12-302020-09-270001094285us-gaap:OperatingSegmentsMembertdy:AerospaceAndDefenseElectronicsMember2018-12-312019-09-290001094285tdy:EngineeredSystemsMemberus-gaap:OperatingSegmentsMember2020-06-292020-09-270001094285tdy:EngineeredSystemsMemberus-gaap:OperatingSegmentsMember2019-07-012019-09-290001094285tdy:EngineeredSystemsMemberus-gaap:OperatingSegmentsMember2019-12-302020-09-270001094285tdy:EngineeredSystemsMemberus-gaap:OperatingSegmentsMember2018-12-312019-09-290001094285us-gaap:CorporateNonSegmentMember2020-06-292020-09-270001094285us-gaap:CorporateNonSegmentMember2019-07-012019-09-290001094285us-gaap:CorporateNonSegmentMember2019-12-302020-09-270001094285us-gaap:CorporateNonSegmentMember2018-12-312019-09-290001094285us-gaap:IntersegmentEliminationMember2020-06-292020-09-270001094285us-gaap:IntersegmentEliminationMember2019-12-302020-09-270001094285us-gaap:IntersegmentEliminationMember2019-07-012019-09-290001094285us-gaap:IntersegmentEliminationMember2018-12-312019-09-290001094285tdy:InstrumentationMemberus-gaap:OperatingSegmentsMember2020-09-270001094285tdy:InstrumentationMemberus-gaap:OperatingSegmentsMember2019-12-290001094285tdy:DigitalImagingMemberus-gaap:OperatingSegmentsMember2020-09-270001094285tdy:DigitalImagingMemberus-gaap:OperatingSegmentsMember2019-12-290001094285us-gaap:OperatingSegmentsMembertdy:AerospaceAndDefenseElectronicsMember2020-09-270001094285us-gaap:OperatingSegmentsMembertdy:AerospaceAndDefenseElectronicsMember2019-12-290001094285tdy:EngineeredSystemsMemberus-gaap:OperatingSegmentsMember2020-09-270001094285tdy:EngineeredSystemsMemberus-gaap:OperatingSegmentsMember2019-12-290001094285us-gaap:CorporateNonSegmentMember2020-09-270001094285us-gaap:CorporateNonSegmentMember2019-12-29tdy:product_line0001094285tdy:InstrumentationMember2020-09-270001094285tdy:DigitalImagingMember2020-09-270001094285tdy:AerospaceAndDefenseElectronicsMember2020-09-270001094285tdy:EngineeredSystemsMember2020-09-270001094285tdy:MarineInstrumentationMembertdy:InstrumentationMemberus-gaap:OperatingSegmentsMember2020-06-292020-09-270001094285tdy:MarineInstrumentationMembertdy:InstrumentationMemberus-gaap:OperatingSegmentsMember2019-07-012019-09-290001094285tdy:MarineInstrumentationMembertdy:InstrumentationMemberus-gaap:OperatingSegmentsMember2019-12-302020-09-270001094285tdy:MarineInstrumentationMembertdy:InstrumentationMemberus-gaap:OperatingSegmentsMember2018-12-312019-09-290001094285tdy:InstrumentationMemberus-gaap:OperatingSegmentsMembertdy:EnvironmentalInstrumentationMember2020-06-292020-09-270001094285tdy:InstrumentationMemberus-gaap:OperatingSegmentsMembertdy:EnvironmentalInstrumentationMember2019-07-012019-09-290001094285tdy:InstrumentationMemberus-gaap:OperatingSegmentsMembertdy:EnvironmentalInstrumentationMember2019-12-302020-09-270001094285tdy:InstrumentationMemberus-gaap:OperatingSegmentsMembertdy:EnvironmentalInstrumentationMember2018-12-312019-09-290001094285tdy:InstrumentationMemberus-gaap:OperatingSegmentsMembertdy:TestAndMeasurementInstrumentationMember2020-06-292020-09-270001094285tdy:InstrumentationMemberus-gaap:OperatingSegmentsMembertdy:TestAndMeasurementInstrumentationMember2019-07-012019-09-290001094285tdy:InstrumentationMemberus-gaap:OperatingSegmentsMembertdy:TestAndMeasurementInstrumentationMember2019-12-302020-09-270001094285tdy:InstrumentationMemberus-gaap:OperatingSegmentsMembertdy:TestAndMeasurementInstrumentationMember2018-12-312019-09-290001094285tdy:InstrumentationMembertdy:USGovernmentMember2020-06-292020-09-270001094285tdy:InstrumentationMembertdy:CommercialMember2020-06-292020-09-270001094285tdy:InstrumentationMember2020-06-292020-09-270001094285tdy:InstrumentationMembertdy:USGovernmentMember2019-12-302020-09-270001094285tdy:InstrumentationMembertdy:CommercialMember2019-12-302020-09-270001094285tdy:InstrumentationMember2019-12-302020-09-270001094285tdy:DigitalImagingMembertdy:USGovernmentMember2020-06-292020-09-270001094285tdy:DigitalImagingMembertdy:CommercialMember2020-06-292020-09-270001094285tdy:DigitalImagingMember2020-06-292020-09-270001094285tdy:DigitalImagingMembertdy:USGovernmentMember2019-12-302020-09-270001094285tdy:DigitalImagingMembertdy:CommercialMember2019-12-302020-09-270001094285tdy:AerospaceAndDefenseElectronicsMembertdy:USGovernmentMember2020-06-292020-09-270001094285tdy:CommercialMembertdy:AerospaceAndDefenseElectronicsMember2020-06-292020-09-270001094285tdy:AerospaceAndDefenseElectronicsMember2020-06-292020-09-270001094285tdy:AerospaceAndDefenseElectronicsMembertdy:USGovernmentMember2019-12-302020-09-270001094285tdy:CommercialMembertdy:AerospaceAndDefenseElectronicsMember2019-12-302020-09-270001094285tdy:AerospaceAndDefenseElectronicsMember2019-12-302020-09-270001094285tdy:EngineeredSystemsMembertdy:USGovernmentMember2020-06-292020-09-270001094285tdy:EngineeredSystemsMembertdy:CommercialMember2020-06-292020-09-270001094285tdy:EngineeredSystemsMember2020-06-292020-09-270001094285tdy:EngineeredSystemsMembertdy:USGovernmentMember2019-12-302020-09-270001094285tdy:EngineeredSystemsMembertdy:CommercialMember2019-12-302020-09-270001094285tdy:EngineeredSystemsMember2019-12-302020-09-270001094285tdy:USGovernmentMember2020-06-292020-09-270001094285tdy:CommercialMember2020-06-292020-09-270001094285tdy:USGovernmentMember2019-12-302020-09-270001094285tdy:CommercialMember2019-12-302020-09-270001094285tdy:InstrumentationMemberus-gaap:FixedPriceContractMember2020-06-292020-09-270001094285tdy:InstrumentationMembertdy:CostTypeMember2020-06-292020-09-270001094285tdy:InstrumentationMemberus-gaap:FixedPriceContractMember2019-12-302020-09-270001094285tdy:InstrumentationMembertdy:CostTypeMember2019-12-302020-09-270001094285tdy:DigitalImagingMemberus-gaap:FixedPriceContractMember2020-06-292020-09-270001094285tdy:DigitalImagingMembertdy:CostTypeMember2020-06-292020-09-270001094285tdy:DigitalImagingMemberus-gaap:FixedPriceContractMember2019-12-302020-09-270001094285tdy:DigitalImagingMembertdy:CostTypeMember2019-12-302020-09-270001094285us-gaap:FixedPriceContractMembertdy:AerospaceAndDefenseElectronicsMember2020-06-292020-09-270001094285tdy:AerospaceAndDefenseElectronicsMembertdy:CostTypeMember2020-06-292020-09-270001094285us-gaap:FixedPriceContractMembertdy:AerospaceAndDefenseElectronicsMember2019-12-302020-09-270001094285tdy:AerospaceAndDefenseElectronicsMembertdy:CostTypeMember2019-12-302020-09-270001094285tdy:EngineeredSystemsMemberus-gaap:FixedPriceContractMember2020-06-292020-09-270001094285tdy:EngineeredSystemsMembertdy:CostTypeMember2020-06-292020-09-270001094285tdy:EngineeredSystemsMemberus-gaap:FixedPriceContractMember2019-12-302020-09-270001094285tdy:EngineeredSystemsMembertdy:CostTypeMember2019-12-302020-09-270001094285us-gaap:FixedPriceContractMember2020-06-292020-09-270001094285tdy:CostTypeMember2020-06-292020-09-270001094285us-gaap:FixedPriceContractMember2019-12-302020-09-270001094285tdy:CostTypeMember2019-12-302020-09-270001094285tdy:InstrumentationMembercountry:US2020-06-292020-09-270001094285srt:EuropeMembertdy:InstrumentationMember2020-06-292020-09-270001094285tdy:InstrumentationMembertdy:OtherGeographicalAreasMember2020-06-292020-09-270001094285tdy:InstrumentationMembercountry:US2019-12-302020-09-270001094285srt:EuropeMembertdy:InstrumentationMember2019-12-302020-09-270001094285tdy:InstrumentationMembertdy:OtherGeographicalAreasMember2019-12-302020-09-270001094285tdy:DigitalImagingMembercountry:US2020-06-292020-09-270001094285srt:EuropeMembertdy:DigitalImagingMember2020-06-292020-09-270001094285tdy:DigitalImagingMembertdy:OtherGeographicalAreasMember2020-06-292020-09-270001094285tdy:DigitalImagingMembercountry:US2019-12-302020-09-270001094285srt:EuropeMembertdy:DigitalImagingMember2019-12-302020-09-270001094285tdy:DigitalImagingMembertdy:OtherGeographicalAreasMember2019-12-302020-09-270001094285country:UStdy:AerospaceAndDefenseElectronicsMember2020-06-292020-09-270001094285srt:EuropeMembertdy:AerospaceAndDefenseElectronicsMember2020-06-292020-09-270001094285tdy:OtherGeographicalAreasMembertdy:AerospaceAndDefenseElectronicsMember2020-06-292020-09-270001094285country:UStdy:AerospaceAndDefenseElectronicsMember2019-12-302020-09-270001094285srt:EuropeMembertdy:AerospaceAndDefenseElectronicsMember2019-12-302020-09-270001094285tdy:OtherGeographicalAreasMembertdy:AerospaceAndDefenseElectronicsMember2019-12-302020-09-270001094285tdy:EngineeredSystemsMembercountry:US2020-06-292020-09-270001094285srt:EuropeMembertdy:EngineeredSystemsMember2020-06-292020-09-270001094285tdy:EngineeredSystemsMembertdy:OtherGeographicalAreasMember2020-06-292020-09-270001094285tdy:EngineeredSystemsMembercountry:US2019-12-302020-09-270001094285srt:EuropeMembertdy:EngineeredSystemsMember2019-12-302020-09-270001094285tdy:EngineeredSystemsMembertdy:OtherGeographicalAreasMember2019-12-302020-09-270001094285country:US2020-06-292020-09-270001094285srt:EuropeMember2020-06-292020-09-270001094285tdy:OtherGeographicalAreasMember2020-06-292020-09-270001094285country:US2019-12-302020-09-270001094285srt:EuropeMember2019-12-302020-09-270001094285tdy:OtherGeographicalAreasMember2019-12-302020-09-270001094285tdy:InstrumentationMembertdy:USGovernmentMember2019-07-012019-09-290001094285tdy:InstrumentationMembertdy:CommercialMember2019-07-012019-09-290001094285tdy:InstrumentationMember2019-07-012019-09-290001094285tdy:InstrumentationMembertdy:USGovernmentMember2018-12-312019-09-290001094285tdy:InstrumentationMembertdy:CommercialMember2018-12-312019-09-290001094285tdy:InstrumentationMember2018-12-312019-09-290001094285tdy:DigitalImagingMembertdy:USGovernmentMember2019-07-012019-09-290001094285tdy:DigitalImagingMembertdy:CommercialMember2019-07-012019-09-290001094285tdy:DigitalImagingMember2019-07-012019-09-290001094285tdy:DigitalImagingMembertdy:USGovernmentMember2018-12-312019-09-290001094285tdy:DigitalImagingMembertdy:CommercialMember2018-12-312019-09-290001094285tdy:AerospaceAndDefenseElectronicsMembertdy:USGovernmentMember2019-07-012019-09-290001094285tdy:CommercialMembertdy:AerospaceAndDefenseElectronicsMember2019-07-012019-09-290001094285tdy:AerospaceAndDefenseElectronicsMember2019-07-012019-09-290001094285tdy:AerospaceAndDefenseElectronicsMembertdy:USGovernmentMember2018-12-312019-09-290001094285tdy:CommercialMembertdy:AerospaceAndDefenseElectronicsMember2018-12-312019-09-290001094285tdy:AerospaceAndDefenseElectronicsMember2018-12-312019-09-290001094285tdy:EngineeredSystemsMembertdy:USGovernmentMember2019-07-012019-09-290001094285tdy:EngineeredSystemsMembertdy:CommercialMember2019-07-012019-09-290001094285tdy:EngineeredSystemsMember2019-07-012019-09-290001094285tdy:EngineeredSystemsMembertdy:USGovernmentMember2018-12-312019-09-290001094285tdy:EngineeredSystemsMembertdy:CommercialMember2018-12-312019-09-290001094285tdy:EngineeredSystemsMember2018-12-312019-09-290001094285tdy:USGovernmentMember2019-07-012019-09-290001094285tdy:CommercialMember2019-07-012019-09-290001094285tdy:USGovernmentMember2018-12-312019-09-290001094285tdy:CommercialMember2018-12-312019-09-290001094285tdy:InstrumentationMemberus-gaap:FixedPriceContractMember2019-07-012019-09-290001094285tdy:InstrumentationMembertdy:CostTypeMember2019-07-012019-09-290001094285tdy:InstrumentationMemberus-gaap:FixedPriceContractMember2018-12-312019-09-290001094285tdy:InstrumentationMembertdy:CostTypeMember2018-12-312019-09-290001094285tdy:DigitalImagingMemberus-gaap:FixedPriceContractMember2019-07-012019-09-290001094285tdy:DigitalImagingMembertdy:CostTypeMember2019-07-012019-09-290001094285tdy:DigitalImagingMemberus-gaap:FixedPriceContractMember2018-12-312019-09-290001094285tdy:DigitalImagingMembertdy:CostTypeMember2018-12-312019-09-290001094285us-gaap:FixedPriceContractMembertdy:AerospaceAndDefenseElectronicsMember2019-07-012019-09-290001094285tdy:AerospaceAndDefenseElectronicsMembertdy:CostTypeMember2019-07-012019-09-290001094285us-gaap:FixedPriceContractMembertdy:AerospaceAndDefenseElectronicsMember2018-12-312019-09-290001094285tdy:AerospaceAndDefenseElectronicsMembertdy:CostTypeMember2018-12-312019-09-290001094285tdy:EngineeredSystemsMemberus-gaap:FixedPriceContractMember2019-07-012019-09-290001094285tdy:EngineeredSystemsMembertdy:CostTypeMember2019-07-012019-09-290001094285tdy:EngineeredSystemsMemberus-gaap:FixedPriceContractMember2018-12-312019-09-290001094285tdy:EngineeredSystemsMembertdy:CostTypeMember2018-12-312019-09-290001094285us-gaap:FixedPriceContractMember2019-07-012019-09-290001094285tdy:CostTypeMember2019-07-012019-09-290001094285us-gaap:FixedPriceContractMember2018-12-312019-09-290001094285tdy:CostTypeMember2018-12-312019-09-290001094285tdy:InstrumentationMembercountry:US2019-07-012019-09-290001094285srt:EuropeMembertdy:InstrumentationMember2019-07-012019-09-290001094285tdy:InstrumentationMembertdy:OtherGeographicalAreasMember2019-07-012019-09-290001094285tdy:InstrumentationMembercountry:US2018-12-312019-09-290001094285srt:EuropeMembertdy:InstrumentationMember2018-12-312019-09-290001094285tdy:InstrumentationMembertdy:OtherGeographicalAreasMember2018-12-312019-09-290001094285tdy:DigitalImagingMembercountry:US2019-07-012019-09-290001094285srt:EuropeMembertdy:DigitalImagingMember2019-07-012019-09-290001094285tdy:DigitalImagingMembertdy:OtherGeographicalAreasMember2019-07-012019-09-290001094285tdy:DigitalImagingMembercountry:US2018-12-312019-09-290001094285srt:EuropeMembertdy:DigitalImagingMember2018-12-312019-09-290001094285tdy:DigitalImagingMembertdy:OtherGeographicalAreasMember2018-12-312019-09-290001094285country:UStdy:AerospaceAndDefenseElectronicsMember2019-07-012019-09-290001094285srt:EuropeMembertdy:AerospaceAndDefenseElectronicsMember2019-07-012019-09-290001094285tdy:OtherGeographicalAreasMembertdy:AerospaceAndDefenseElectronicsMember2019-07-012019-09-290001094285country:UStdy:AerospaceAndDefenseElectronicsMember2018-12-312019-09-290001094285srt:EuropeMembertdy:AerospaceAndDefenseElectronicsMember2018-12-312019-09-290001094285tdy:OtherGeographicalAreasMembertdy:AerospaceAndDefenseElectronicsMember2018-12-312019-09-290001094285tdy:EngineeredSystemsMembercountry:US2019-07-012019-09-290001094285srt:EuropeMembertdy:EngineeredSystemsMember2019-07-012019-09-290001094285tdy:EngineeredSystemsMembertdy:OtherGeographicalAreasMember2019-07-012019-09-290001094285tdy:EngineeredSystemsMembercountry:US2018-12-312019-09-290001094285srt:EuropeMembertdy:EngineeredSystemsMember2018-12-312019-09-290001094285tdy:EngineeredSystemsMembertdy:OtherGeographicalAreasMember2018-12-312019-09-290001094285country:US2019-07-012019-09-290001094285srt:EuropeMember2019-07-012019-09-290001094285tdy:OtherGeographicalAreasMember2019-07-012019-09-290001094285country:US2018-12-312019-09-290001094285srt:EuropeMember2018-12-312019-09-290001094285tdy:OtherGeographicalAreasMember2018-12-312019-09-29

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_____________________________________


i ☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


i ☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number i 1-15295

_____________________________________

i TELEDYNE TECHNOLOGIES INCORPORATED

_____________________________________

i Delaware

i 25-1843385

(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer
Identification Number)

i 1049 Camino Dos Rios

i Thousand Oaks

i California

i 91360-2362

(Address of principal executive offices)

(Zip Code)

(Registrant’s telephone number, including area code)

____________________________________

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
i Common Stock, $0.01 par value	i TDY	i New York Stock Exchange

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. i Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files). i Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):


i Large accelerated filer	☒	Accelerated filer	☐

Non-accelerated filer	☐	Smaller reporting company	i ☐

Emerging growth company	i ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes i ☐

There were i 36,881,725 shares of common stock, $.01 par value per share, outstanding as of October 20, 2020.

TELEDYNE TECHNOLOGIES INCORPORATED

PART I FINANCIAL INFORMATION

Item 1. Financial Statements

TELEDYNE TECHNOLOGIES INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

FOR THE THIRD QUARTER AND NINE MONTHS ENDED SEPTEMBER 27, 2020 AND SEPTEMBER 29, 2019

(Unaudited - Amounts in millions, except per-share amounts)

Third Quarter

Nine Months

2020

2019

2020

2019

Net sales

i 749.0

i 802.2

i 2,276.9

i 2,329.4

Costs and expenses

Cost of sales

i 458.5

i 487.7

i 1,411.7

i 1,415.2

Selling, general and administrative expenses

i 168.0

i 185.8

i 528.9

i 556.3

Total costs and expenses

i 626.5

i 673.5

i 1,940.6

i 1,971.5

Operating income

i 122.5

i 128.7

i 336.3

i 357.9

Interest and debt expense, net

( i 4.1)

( i 5.5)

( i 11.9)

( i 16.3)

Non-service retirement benefit income

i 3.2

i 1.9

i 8.9

i 6.1

Other expense, net

( i 1.9)

( i 1.7)

( i 4.7)

( i 3.5)

Income before income taxes

i 119.7

i 123.4

i 328.6

i 344.2

Provision for income taxes

i 25.8

i 16.7

i 58.8

i 57.6

Net income

i 93.9

i 106.7

i 269.8

i 286.6

Basic earnings per common share

i 2.55

i 2.93

i 7.35

i 7.92

Weighted average common shares outstanding

i 36.8

i 36.4

i 36.7

i 36.2

Diluted earnings per common share

i 2.48

i 2.84

i 7.14

i 7.66

Weighted average diluted common shares outstanding

i 37.8

i 37.6

i 37.8

i 37.4

The accompanying notes are an integral part of these condensed consolidated financial statements.

TELEDYNE TECHNOLOGIES INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

FOR THE THIRD QUARTER AND NINE MONTHS ENDED SEPTEMBER 27, 2020 AND SEPTEMBER 29, 2019

(Unaudited - Amounts in millions)

Third Quarter

Nine Months

2020

2019

2020

2019

Net income

i 93.9

i 106.7

i 269.8

i 286.6

Other comprehensive income (loss):

Foreign exchange translation adjustment

i 38.7

( i 27.4)

( i 21.2)

( i 15.0)

Hedge activity, net of tax

i 2.6

( i 1.1)

i 0.6

i 2.0

Pension and postretirement benefit adjustments, net of tax

i 2.9

i 4.9

i 9.6

i 14.4

Other comprehensive income (loss)

i 44.2

( i 23.6)

( i 11.0)

i 1.4

Comprehensive income

i 138.1

i 83.1

i 258.8

i 288.0

The accompanying notes are an integral part of these condensed consolidated financial statements.

TELEDYNE TECHNOLOGIES INCORPORATED

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited - Amounts in millions, except share amounts)


	September 27, 2020		December 29, 2019
Assets
Current Assets
Cash and cash equivalents	$	i 454.5	$	i 199.5

Accounts receivable, net	i 411.4		i 460.4
Unbilled receivables, net	i 238.8		i 200.5
Inventories, net	i 365.4		i 393.4

Prepaid expenses and other current assets	i 65.0		i 59.9

Total current assets	i 1,535.1		i 1,313.7
Property, plant and equipment, net of accumulated depreciation and amortization of $ i 673.0 at September 27, 2020 and $ i 623.9 at December 29, 2019	i 475.7		i 487.9
Goodwill	i 2,091.3		i 2,050.5
Acquired intangibles, net	i 408.8		i 430.8
Prepaid pension assets	i 88.7		i 71.8
Operating lease right-of-use assets	i 126.2		i 127.1
Other assets, net	i 111.2		i 98.0
Total Assets	$	i 4,837.0	$	i 4,579.8
Liabilities and Stockholders’ Equity
Current Liabilities
Accounts payable	$	i 216.6	$	i 271.1
Accrued liabilities	i 429.0		i 391.5
Current portion of long-term debt and other debt, net	i 25.6		i 100.6

Total current liabilities	i 671.2		i 763.2
Long-term debt	i 761.1		i 750.0
Long-term operating lease liabilities	i 117.0		i 119.3

Other long-term liabilities	i 261.7		i 232.6
Total Liabilities	i 1,811.0		i 1,865.1
Commitments and contingencies	i		i
Stockholders’ Equity
Preferred stock, $ i i 0.01 / par value; outstanding shares - i i none /	i —		i —
Common stock, $ i i 0.01 / par value; authorized i i 125,000,000 / shares; issued shares: i i 37,697,865 / at September 27, 2020 and December 29, 2019; outstanding shares: i 36,871,712 at September 27, 2020 and i 36,547,966 at December 29, 2019	i 0.4		i 0.4
Additional paid-in capital	i 382.9		i 360.5
Retained earnings	i 3,195.8		i 2,926.0
Treasury stock, i 826,153 shares at September 27, 2020 and i 1,149,899 shares at December 29, 2019	( i 66.3)		( i 96.4)
Accumulated other comprehensive loss	( i 486.8)		( i 475.8)


Total Stockholders’ Equity	i 3,026.0		i 2,714.7
Total Liabilities and Stockholders’ Equity	$	i 4,837.0	$	i 4,579.8

The accompanying notes are an integral part of these condensed consolidated financial statements.

TELEDYNE TECHNOLOGIES INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

Common Stock

Additional Paid-in Capital

Treasury Stock

Retained Earnings

Accumulated Other Comprehensive Income (Loss)

Total

Balance, December 29, 2019

i 0.4

i 360.5

( i 96.4)

i 2,926.0

( i 475.8)

i 2,714.7

Net income

—

i 82.2

—

i 82.2

Other comprehensive income, net of tax

—

( i 63.7)

Treasury stock issued

—

( i 9.4)

i 9.4

—

i —

Stock-based compensation

—

i 9.6

—

i 9.6

Exercise of stock options

—

i 10.2

—

i 10.2

Balance, March 29, 2020

i 0.4

i 370.9

( i 87.0)

i 3,008.2

( i 539.5)

i 2,753.0

Net income

—

i 93.7

—

i 93.7

Other comprehensive income, net of tax

—

i 8.5

Treasury stock issued

—

( i 19.4)

i 19.4

—

i —

Stock-based compensation

—

i 6.7

—

i 6.7

Exercise of stock options

—

i 18.0

—

i 18.0

Balance, June 28, 2020

i 0.4

i 376.2

( i 67.6)

i 3,101.9

( i 531.0)

i 2,879.9

Net income

—

i 93.9

—

i 93.9

Other comprehensive income, net of tax

—

i 44.2

Treasury stock issued

—

( i 1.3)

i 1.3

—

i —

Stock-based compensation

—

i 6.7

—

i 6.7

Exercise of stock options and other

—

i 1.3

—

i 1.3

Balance, September 27, 2020

i 0.4

i 382.9

( i 66.3)

i 3,195.8

( i 486.8)

i 3,026.0

Common Stock

Additional Paid-in Capital

Treasury Stock

Retained Earnings

Accumulated Other Comprehensive Income (Loss)

Total

Balance, December 30, 2018

i 0.4

i 343.7

( i 144.9)

i 2,523.7

( i 493.2)

i 2,229.7

Net income

—

i 75.3

—

i 75.3

Other comprehensive income, net of tax

—

i 23.4

Treasury stock issued

—

( i 15.0)

i 15.0

—

i —

Stock-based compensation

—

i 10.9

—

i 10.9

Exercise of stock options

—

i 10.2

—

i 10.2

Balance, March 31, 2019

i 0.4

i 349.8

( i 129.9)

i 2,599.0

( i 469.8)

i 2,349.5

Net income

—

i 104.6

—

i 104.6

Other comprehensive income, net of tax

—

i 1.6

Treasury stock issued

—

( i 14.7)

i 14.7

—

i —

Stock based compensation

—

i 6.8

—

i 6.8

Exercise of stock options

—

i 10.5

—

i 10.5

Balance, June 30, 2019

i 0.4

i 352.4

( i 115.2)

i 2,703.6

( i 468.2)

i 2,473.0

Net income

—

i 106.7

—

i 106.7

Other comprehensive loss, net of tax

—

( i 23.6)

Treasury stock issued

—

( i 10.6)

i 10.6

—

i —

Stock-based compensation

—

i 6.4

—

i 6.4

Exercise of stock options and other

—

i 8.5

—

i 8.5

Balance, September 29, 2019

i 0.4

i 356.7

( i 104.6)

i 2,810.3

( i 491.8)

i 2,571.0

The accompanying notes are an integral part of these condensed consolidated financial statements.

TELEDYNE TECHNOLOGIES INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 27, 2020 AND SEPTEMBER 29, 2019

(Unaudited - Amounts in millions)

Nine Months

2020

2019

Operating Activities

Net income

i 269.8

i 286.6

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

i 87.5

i 82.6

Stock-based compensation

i 23.0

i 24.1

Changes in operating assets and liabilities excluding the effect of business acquired:

Accounts receivable and unbilled receivables

i 8.7

( i 49.1)

Inventories

i 27.1

( i 2.7)

Accounts payable

( i 52.2)

i 7.3

Deferred and income taxes receivable/payable, net

i 10.8

( i 18.7)

Prepaid expenses and other assets

( i 9.1)

( i 18.0)

Accrued expenses and other liabilities

i 11.1

i 8.0

Other operating, net

i 5.8

( i 5.9)

Net cash provided by operating activities

i 382.5

i 314.2

Investing Activities

Purchases of property, plant and equipment

( i 52.0)

( i 64.5)

Purchase of businesses, net of cash acquired

( i 29.0)

( i 483.7)

Other investing, net

i 0.1

i 0.4

Net cash used in investing activities

( i 80.9)

( i 547.8)

Financing Activities

Net proceeds from credit facility

—

i 196.0

Net payments on other debt

( i 75.4)

( i 7.1)

Proceeds from exercise of stock options

i 29.5

i 29.2

Other financing, net

—

( i 1.4)

Net cash provided by financing activities

( i 45.9)

i 216.7

Effect of exchange rate changes on cash

( i 0.7)

i 2.9

Change in cash and cash equivalents

i 255.0

( i 14.0)

Cash and cash equivalents—beginning of period

i 199.5

i 142.5

Cash and cash equivalents—end of period

i 454.5

i 128.5

The accompanying notes are an integral part of these condensed consolidated financial statements.

TELEDYNE TECHNOLOGIES INCORPORATED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared by Teledyne Technologies Incorporated (“Teledyne” or the “Company”) pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and disclosures normally included in notes to consolidated financial statements have been condensed or omitted pursuant to such rules and regulations, but resultant disclosures are in accordance with accounting principles generally accepted in the United States (“GAAP”) as they apply to interim reporting. The condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the related notes in Teledyne’s Annual Report on Form 10-K for the fiscal year ended December 29, 2019 (“2019 Form 10-K”).

In the opinion of Teledyne’s management, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting of normal recurring adjustments) necessary to present fairly, in all material respects, Teledyne’s consolidated financial position as of September 27, 2020 and the consolidated results of operations, consolidated comprehensive income for the third quarter and nine months then ended and the consolidated cash flows for the nine months then ended. The results of operations and cash flows for the periods ended September 27, 2020 are not necessarily indicative of the results of operations or cash flows to be expected for any subsequent quarter or the full fiscal year. Certain prior year amounts have been reclassified to conform to the current period presentation.

Cash equivalents consist of highly liquid money-market mutual funds and bank deposits with maturities of three months or less when purchased. Cash equivalents totaled $ i 254.0 million at September 27, 2020. There were i no cash equivalents at December 29, 2019.

Recent Accounting Pronouncements

In January 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2017-04, Simplifying the Test for Goodwill Impairment, which eliminates the computation of the implied fair value of goodwill to measure a goodwill impairment charge. Instead, entities will record a goodwill impairment charge based on the excess of a reporting unit’s carrying amount over its fair value. We adopted the new guidance as of December 30, 2019 which reduced the complexity surrounding the evaluation of goodwill for impairment. The adoption of this guidance did not have a material impact on our condensed consolidated financial statements.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326). The standard replaces the incurred loss impairment methodology under current GAAP with a methodology that reflects expected credit losses and requires the use of a forward-looking expected credit loss model for accounts receivables, loans, and other financial instruments. The standard requires a modified retrospective approach through a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. We adopted the new guidance as of December 30, 2019 using the modified retrospective approach related to our accounts receivables and contract assets, resulting in no cumulative adjustment to retained earnings. The adoption of this guidance did not have a material impact on our condensed consolidated financial statements.

Note 2. i Accumulated Other Comprehensive Loss

The changes in AOCI by component, net of tax, for the third quarter and nine months ended September 27, 2020 and September 29, 2019 are as follows (in millions):

Foreign Currency Translation

Cash Flow Hedges and Other

Pension and Postretirement Benefits

Total

Balance as of June 28, 2020

( i 210.3)

( i 4.3)

( i 316.4)

( i 531.0)

Other comprehensive income/(loss) before reclassifications

i 38.7

( i 5.4)

i —

i 33.3

Amounts reclassified from AOCI

i —

i 8.0

i 2.9

i 10.9

Net other comprehensive income

i 38.7

i 2.6

i 2.9

i 44.2

Balance as of September 27, 2020

( i 171.6)

( i 1.7)

( i 313.5)

( i 486.8)

Foreign Currency Translation

Cash Flow Hedges and Other

Pension and Postretirement Benefits

Total

Balance as of June 30, 2019

( i 169.1)

( i 1.8)

( i 297.3)

( i 468.2)

Other comprehensive income/(loss) before reclassifications

( i 27.4)

i 3.9

i —

( i 23.5)

Amounts reclassified from AOCI

i —

( i 5.0)

i 4.9

( i 0.1)

Net other comprehensive income/(loss)

( i 27.4)

( i 1.1)

i 4.9

( i 23.6)

Balance as of September 29, 2019

( i 196.5)

( i 2.9)

( i 292.4)

( i 491.8)

Foreign Currency Translation

Cash Flow Hedges and Other

Pension and Postretirement Benefits

Total

Balance as of December 29, 2019

( i 150.4)

( i 2.3)

( i 323.1)

( i 475.8)

Other comprehensive loss before reclassifications

( i 21.2)

( i 9.2)

i —

( i 30.4)

Amounts reclassified from AOCI

i —

i 9.8

i 9.6

i 19.4

Net other comprehensive income/(loss)

( i 21.2)

i 0.6

i 9.6

( i 11.0)

Balance as of September 27, 2020

( i 171.6)

( i 1.7)

( i 313.5)

( i 486.8)

Foreign Currency Translation

Cash Flow Hedges and Other

Pension and Postretirement Benefits

Total

Balance as of December 30, 2018

( i 181.5)

( i 4.9)

( i 306.8)

( i 493.2)

Other comprehensive income (loss) before reclassifications

( i 15.0)

i 7.7

i —

( i 7.3)

Amounts reclassified from AOCI

i —

( i 5.7)

i 14.4

i 8.7

Net other comprehensive income (loss)

( i 15.0)

i 2.0

i 14.4

i 1.4

Balance as of September 29, 2019

( i 196.5)

( i 2.9)

( i 292.4)

( i 491.8)

The reclassifications out of AOCI to net income for the third quarter and nine months ended September 27, 2020 and September 29, 2019 are as follows (in millions):

Amount Reclassified from AOCI for the Three Months Ended

Statement of Income

September 27, 2020

September 29, 2019

Presentation

(Gain) loss on cash flow hedges:

(Gain) loss recognized in income on derivatives

i 10.8

( i 6.8)

See Note 4

Income tax impact

( i 2.8)

i 1.8

Provision for income taxes

Total

i 8.0

( i 5.0)

Amortization of defined benefit pension and postretirement plan items:

Amortization of prior service cost

( i 1.5)

Costs and expenses

Amortization of net actuarial loss

i 5.4

i 8.0

Costs and expenses

Total before tax

i 3.9

i 6.5

Income tax impact

( i 1.0)

( i 1.6)

Provision for income taxes

Total

i 2.9

i 4.9

Amount Reclassified from AOCI for the Nine Months Ended

Statement of Income

September 27, 2020

September 29, 2019

Presentation

(Gain) loss on cash flow hedges:

(Gain) loss recognized in income on derivatives

i 13.2

( i 7.6)

See Note 4

Income tax impact

( i 3.4)

i 1.9

Provision for income taxes

Total

i 9.8

( i 5.7)

Amortization of defined benefit pension and postretirement plan items:

Amortization of prior service cost

( i 4.5)

Costs and expenses

Amortization of net actuarial loss

i 17.1

i 23.3

Costs and expenses

Total before tax

i 12.6

i 18.8

Income tax impact

( i 3.0)

( i 4.4)

Provision for income taxes

Total

i 9.6

i 14.4

Note 3. i Business Combinations, Goodwill and Acquired Intangible Assets

Acquisition of the OakGate Technology, Inc.

On January 5, 2020, we acquired OakGate Technology, Inc. (“OakGate”) for $ i 28.5 million in cash, net of cash acquired. Based in Loomis, California, OakGate provides software and hardware designed to test electronic data storage devices from development through manufacturing and end-use applications. The acquired business is part of the Test and Measurement product line of the Instrumentation segment.

Acquisition of Micralyne, Inc.

On August 30, 2019, we acquired Micralyne Inc. (“Micralyne”) for $ i 26.2 million in cash, net of cash acquired and including a $ i 0.5 million purchase price adjustment paid in January 2020. Based in Edmonton, Alberta, Canada, Micralyne is a foundry providing Micro Electro Mechanical Systems or MEMS devices. In particular, Micralyne possesses unique microfluidic technology for biotech applications, as well as capabilities in non-silicon-based MEMS (e.g. gold, polymers) often required for human body compatibility. The acquired business is part of the Digital Imaging segment.

Acquisition of the gas and flame detection business of 3M Company

On August 1, 2019, we acquired the gas and flame detection business of 3M Company for $ i 233.5 million in cash, net of cash acquired. The gas and flame detection business includes Oldham, Simtronics, Gas Measurement Instruments, Detcon and select Scott Safety products. The gas and flame detection business provides a portfolio of fixed and portable industrial gas and flame detection instruments used in a variety of industries including petrochemical, power generation, oil and gas, food and beverage, mining and waste water treatment. Principally located in France, the United Kingdom and the United States, the acquired business is part of the Environmental product line of the Instrumentation segment.

Acquisition of the scientific imaging businesses of Roper Technologies, Inc.

On February 5, 2019, we acquired the scientific imaging businesses of Roper Technologies, Inc. for $ i 224.8 million in cash, net of cash acquired and including a purchase price adjustment. Principally located in the United States and Canada, the acquired businesses are part of the Digital Imaging segment. The acquired businesses include Princeton Instruments, Photometrics and Lumenera. The acquired businesses provide a range of imaging solutions, primarily for life sciences, academic research and customized OEM industrial imaging solutions. Princeton Instruments and Photometrics manufacture state-of-the-art cameras, spectrographs and optics for advanced research in physical sciences, life sciences research and spectroscopy imaging. Applications and markets include materials analysis, quantum technology and cell biology imaging using fluorescence and chemiluminescence. Lumenera primarily provides rugged USB-based customized cameras for markets such as traffic management, as well as life sciences applications.

Goodwill and Acquired Intangible Assets

Teledyne’s goodwill was $ i 2,091.3 million at September 27, 2020 and $ i 2,050.5 million at December 29, 2019. The increase in the balance of goodwill in 2020 resulted from goodwill from recent acquisitions, mostly offset by exchange rate changes. Goodwill resulting from the acquisition of OakGate will not be deductible for tax purposes. Teledyne’s net acquired intangible assets were $ i 408.8 million at September 27, 2020 and $ i 430.8 million at December 29, 2019. The decrease in the balance of net acquired intangible assets resulted from amortization of acquired intangible assets and exchange rate changes. The Company completed the process of specifically identifying the amount to be assigned to certain assets, including acquired intangible assets, and liabilities and the related impact on taxes and goodwill for acquisitions made in 2019. The Company is in the process of specifically identifying the amount to be assigned to certain assets, including acquired intangible assets, and liabilities and the related impact on taxes and goodwill for the OakGate acquisition since there was insufficient time between the acquisition dates and the end of the period to finalize the analysis.

Teledyne funded the acquisitions with borrowings under its credit facility and cash on hand. The results of each acquisition have been included in Teledyne’s results since the date of each respective acquisition.

During the third quarter of 2020, the Company evaluated the effects of the COVID-19 pandemic and its negative impact on the global economy on each of the Company’s reporting units and indefinite-lived intangible assets. Management reviewed key assumptions, including revisions of projected future revenues for reporting units and the results of the previous annual impairment testing performed during the fourth quarter of 2019. The Company did not identify an indication of impairment for each of its reporting units and indefinite-lived intangible assets. Although it was determined that a triggering event had not occurred as of September 27, 2020, we will continue to monitor the impacts of the COVID-19 pandemic on the Company’s reporting units and indefinite-lived intangible assets.

Note 4. i Derivative Instruments

Teledyne transacts business in various foreign currencies and has international sales and expenses denominated in foreign currencies, subjecting the Company to foreign currency risk. The Company’s primary foreign currency risk management objective is to protect the U.S. dollar value of future cash flows and minimize the volatility of reported earnings. The Company utilizes foreign currency forward contracts to reduce the volatility of cash flows primarily related to forecasted revenues and expenses denominated in Canadian dollars for our Canadian companies, and in British pounds for our UK companies. These contracts are designated and qualify as cash flow hedges. The Company has also converted a U.S. dollar denominated, variable rate obligation into a euro fixed rate obligation using a receive float, pay fixed cross currency swap. These cross currency swaps are designated as cash flow hedges. In addition the Company has converted domestic U.S. variable rate debt to fixed rate debt using a receive variable, pay fixed interest rate swap. The interest rate swap is also designated as a cash flow hedge.

The effectiveness of the cash flow hedge forward contracts, is assessed prospectively and retrospectively using regression analysis, as well as using other timing and probability criteria. To receive hedge accounting treatment, all hedging relationships are formally documented at the inception of the hedges, and hedges must be highly effective in offsetting changes to future cash flows on hedged transactions. The effective portion of the cash flow hedge forward contracts’ gains or losses resulting from changes in the fair value of these hedges is initially reported, net of tax, as a component of AOCI in stockholders’ equity until the underlying hedged item is reflected in our consolidated statements of income, at which time the effective amount in AOCI is reclassified to revenue in our consolidated statements of income. Net deferred gains recorded in AOCI, net of tax, for the

forward contracts that will mature in the next twelve months total $ i 0.9 million. These gains are expected to be offset by anticipated losses in the value of the forecasted underlying hedged item. Amounts related to the cross currency swaps and interest rate swap expected to be reclassified from AOCI into income in the next twelve months total $ i 2.0 million.

In the event that the underlying forecasted transactions do not occur, or it becomes remote that they will occur, within the defined hedge period, the gains or losses on the related cash flow hedges will be reclassified from AOCI to other income and expense. During the current reporting period, all forecasted transactions occurred and, therefore, there were no such gains or losses reclassified to other income and expense.

As of September 27, 2020, Teledyne had foreign currency forward contracts designated as cash flow hedges to buy Canadian dollars and to sell U.S. dollars totaling $ i 147.9 million. These foreign currency forward contracts have maturities ranging from December 2020 to February 2022. Teledyne had foreign currency forward contracts designated as cash flow hedges to buy British pounds and to sell U.S. dollars totaling $ i 2.7 million. These foreign currency forward contracts have maturities ranging from December 2020 to February 2021. The cross currency swaps have notional amounts of € i 113.0 million and $ i 125 million, and € i 135.0 million and $ i 150.0 million, and matures in March 2023 and October 2024, respectively. The interest rate swap has a notional amount of $ i 125.0 million and matures in March 2023.

The effect of derivative instruments designated as cash flow hedges in the condensed consolidated financial statements for the third quarter and nine months ended September 27, 2020 and September 29, 2019 was as follows (in millions):


	Third Quarter						Nine Months
	2020		2019		2020		2019
Net gain (loss) recognized in AOCI - Foreign Exchange Contracts (a)	$	( i 7.2)	$	i 5.2	$	( i 7.6)	$	i 10.2
Net gain (loss) reclassified from AOCI into COS - Foreign Exchange Contracts (a)	$	( i 0.2)	$	( i 0.3)	$	( i 1.9)	$	( i 1.5)
Net gain (loss) recognized in AOCI - Interest Rate Contracts	$	( i 0.1)	$	i —	$	( i 4.7)	$	i —
Net gain (loss) reclassified from AOCI into other income and expense, net - Foreign Exchange Contracts (b)	$	( i 11.2)	$	i 6.0	$	( i 14.2)	$	i 6.5
Net gain (loss) reclassified from AOCI into interest expense - Foreign Exchange Contracts	$	i 0.9	$	i —	$	i 3.4	$	i —
Net gain (loss) reclassified from AOCI into interest expense - Interest Rate Contracts	$	( i 0.3)	$	i 1.1	( i 0.5)		$	i 2.6
Net foreign exchange gain (loss) recognized in other income, net (c)	$	i —	$	( i 0.1)	$	i —	$	( i 0.5)

a) Effective portion, pre-tax

b) Amount reclassified to offset earnings impact of liability hedged by cross currency swap

c) Amount excluded from effectiveness testing

Non-Designated Hedging Activities

In addition, the Company utilizes foreign currency forward contracts to mitigate foreign exchange rate risk associated with foreign currency denominated monetary assets and liabilities, including intercompany receivables and payables. i As of September 27, 2020, Teledyne had non-designated foreign currency contracts, of this type in the following pairs (in millions):

Contracts to Buy

Contracts to Sell

Currency

Amount

Currency

Amount

Canadian Dollars

i 78.7

U.S. Dollars

US$

i 60.0

Canadian Dollars

i 16.9

Euros

€

i 10.9

Great Britain Pounds

i 61.4

U.S. Dollars

US$

i 80.9

Euros

€

i i 38.2 /

U.S. Dollars

US$

i i 45.1 /

Danish Krone

DKR

i 175.6

U.S. Dollars

US$

i 27.9

Great Britain Pounds

i 8.8

Euros

€

i 9.7

The above table includes non-designated hedges derived from terms contained in triggered or previously designated cash flow hedges. The gains and losses on these derivatives which are not designated as hedging instruments are intended to, at a minimum, partially offset the transaction gains and losses recognized in earnings. Teledyne does not use foreign currency forward contracts for speculative or trading purposes.

The effect of derivative instruments not designated as cash flow hedges recognized in other income and expense for the third quarter and nine months ended September 27, 2020 was income of $ i 3.0 million and expense of $ i 5.5 million, respectively.. The effect of derivative instruments not designated as cash flow hedges in other income and expense for the third quarter and nine months ended September 29, 2019 was expense of $ i 0.7 million and income of $ i 0.2 million, respectively. The income/expense was largely offset by losses/gains in the value of the underlying hedged item excluding the impact of forward points.

Fair Value of Derivative Financial Instruments

The Company has elected to use the income approach to value the derivatives, using observable Level 2 market expectations at measurement date and standard valuation techniques to convert future amounts to a single present amount. Level 2 inputs for the valuations are limited to quoted prices for similar assets or liabilities in active markets (specifically futures contracts on LIBOR and EURIBOR) and inputs other than quoted prices that are observable for the asset or liability (specifically LIBOR and EURIBOR cash and swap rates, foreign currency forward rates and cross currency basis spreads). Mid-market pricing is used as a practical expedient for fair value measurements. The fair value measurement of an asset or liability must reflect the nonperformance risk of the entity and the counterparty. Therefore, the impact of the counterparty’s creditworthiness when in an asset position and the Company’s creditworthiness when in a liability position has also been factored into the fair value measurement of the derivative instruments and did not have a material impact on the fair value of these derivative instruments. Both the counterparty and the Company are expected to continue to perform under the contractual terms of the instruments.

The fair values of the Company’s derivative financial instruments are presented below. All fair values for these derivatives were measured using Level 2 information as defined by the accounting standard hierarchy (in millions):

Asset/(Liability) Derivatives

Balance sheet location

September 27, 2020

December 29, 2019

Derivatives designated as hedging instruments:

Cash flow forward contracts

Other assets

i 1.6

i 1.3

Cash flow forward contracts

Accrued liabilities

( i 0.6)

( i 0.1)

Cash flow cross currency swap

Other current assets

i 3.5

i 5.4

Cash flow cross currency swap

Accrued liabilities

i —

i 0.3

Cash flow cross currency swap

Other non-current liabilities

( i 14.7)

( i 7.8)

Interest rate contracts

Other current assets

i —

i 0.2

Interest rate contracts

Other non-current assets

i —

i 0.3

Interest rate contracts

Other current liabilities

( i 1.5)

i —

Interest rate contracts

Other non-current liabilities

( i 2.1)

i —

Total derivatives designated as hedging instruments

( i 13.8)

( i 0.4)

Derivatives not designated as hedging instruments:

Non-designated forward contracts

Other current assets

i 0.5

i 0.1

Non-designated forward contracts

Accrued liabilities

( i 5.4)

( i 0.4)

Total derivatives not designated as hedging instruments

( i 4.9)

( i 0.3)

Total derivatives, net

( i 18.7)

( i 0.7)

Note 5. i Earnings Per Share

For the third quarter and first nine months of 2020, i 239,422 and i 242,602 stock options, respectively, were excluded in the computation of diluted earnings per share because they had exercise prices that were greater than the weighted average market price of the Company’s common stock during the respective periods. For the third quarter of 2019, i no stock options were excluded in the computation of earnings per share. For the first nine months of 2019, i 2,160 stock options were excluded in the computation of diluted earnings per share because they had exercise prices that were greater than the weighted average market price of the Company’s common stock during the period. i The weighted average number of common shares used in the calculation of basic and diluted earnings per share consisted of the following (in millions):

Third Quarter

Nine Months

2020

2019

2020

2019

Weighted average basic common shares outstanding

i 36.8

i 36.4

i 36.7

i 36.2

Effect of dilutive securities (primarily stock options)

i 1.0

i 1.2

i 1.1

i 1.2

Weighted average diluted common shares outstanding

i 37.8

i 37.6

i 37.8

i 37.4

Note 6. i Stock-Based Compensation Plans

Teledyne has long-term incentive plans pursuant to which it has granted non-qualified stock options, restricted stock and performance shares to certain employees. The Company also has non-employee Board of Director stock compensation plans, pursuant to which common stock, stock options and restricted stock units have been issued to its directors.

Stock Incentive Plan

Stock option compensation expense was $ i i 5.7 / million for both the third quarter of 2020 and 2019. Stock option compensation expense was $ i 18.8 million for the first nine months of 2020 and was $ i 20.4 million for the first nine months of 2019. Employee stock option grants are charged to expense evenly over the three year vesting period except for stock options that were granted after 2018 to Teledyne’s Executive Chairman and Teledyne’s President and Chief Executive Officer which were expensed immediately. For 2020, the Company currently expects approximately $ i 25.0 million in stock option compensation expense based on stock options outstanding at September 27, 2020. This amount can be impacted by employee retirements and terminations or stock options granted during the remainder of the year. The Company issues shares of common stock upon the exercise of stock options.

The following assumptions were used in the valuation of stock options granted in the first nine months of 2020:


			2020
Expected volatility			i 23.7%
Risk-free interest rate range			1.50% to 1.75%
Expected life in years			i 6.6
Expected dividend yield			i —

Based on the assumptions used in the valuation of stock options, the grant date weighted average fair value of stock options granted in the first nine months of 2020 was $ i 106.26 per share.

Stock option transactions for the third quarter and first nine months of 2020 are summarized as follows:

2020

Third Quarter

Nine Months

Weighted
Average
Exercise
Price

Beginning balance

i 1,927,076

i 166.66

i 1,988,576

i 130.67

Granted

i 820

i 304.19

i 247,273

i 382.91

Exercised

( i 14,486)

i 86.13

( i 302,659)

i 97.40

Canceled

( i 7,173)

i 270.61

( i 26,953)

i 253.13

Ending balance

i 1,906,237

i 166.93

i 1,906,237

i 166.93

Options exercisable at end of period

i 1,322,591

i 116.55

i 1,322,591

i 116.55

Performance Share Plan and Restricted Stock Award Program

Under the 2015 to 2017 Performance Share Plan, the Company issued i 7,673 shares of Teledyne common stock in the first quarter of 2020, i 8,586 shares in the first quarter of 2019 and i 6,481 shares in the first quarter of 2018.

In the first quarter of 2018, the performance cycle for the three-year period ending December 31, 2020, was set. Subject to the terms of the plan, the maximum number of shares that could be issued in three equal installments in 2021, 2022 and 2023 is i 61,194.

The following table shows the restricted stock activity for the first nine months of 2020:


	Shares	Weighted average fair value per share
Balance, December 29, 2019	i 56,412	$	i 158.62
Granted	i 10,080	$	i 360.33
Vested	( i 23,087)	$	i 114.74

Balance, September 27, 2020	i 43,405	$	i 228.80

Note 7. i Inventories

Inventories are stated at current cost, net of reserves for excess, slow moving and obsolete inventory. Inventories are valued under the FIFO method, LIFO method or average cost method. Inventories at cost determined on the average cost or the FIFO methods were $ i 339.7 million at September 27, 2020 and $ i 361.2 million at December 29, 2019. The remainder of the inventories using the LIFO method is $ i 33.0 million at September 27, 2020 and $ i 40.0 million at December 29, 2019. Interim LIFO calculations are based on the Company’s estimates of expected year-end inventory levels and costs since an actual valuation of inventory under the LIFO method can be made only at the end of each year based on the inventory levels and costs at that time. Because these estimates are subject to many factors beyond the Company’s control, interim results are subject to the final year-end LIFO inventory valuation.

Balance at

Inventories (in millions):

September 27, 2020

December 29, 2019

Raw materials and supplies

i 243.1

i 231.2

Work in process

i 70.2

i 108.3

Finished goods

i 59.4

i 61.7

i 372.7

i 401.2

Reduction to LIFO cost basis

( i 7.3)

( i 7.8)

Total inventories, net

i 365.4

i 393.4

Note 8. i Customer Contracts

Estimate at Completion Process

For over time contracts using the cost-to-cost method, we have an Estimate at Completion (“EAC”) process in which management reviews the progress and execution of our performance obligations. This EAC process requires management judgment relative to assessing risks, estimating contract revenue and cost, and making assumptions for schedule and technical issues. Since certain contracts extend over multiple reporting periods, the impact of revisions in cost and revenue estimates during the progress of work may adjust the current period earnings through a cumulative catch-up basis. This method recognizes, in the current period, the cumulative effect of the changes on current and prior quarters. Additionally, if the current contract estimate indicates a loss, a provision is made for the total anticipated loss in the period that it becomes evident. Contract cost and revenue estimates for significant contracts are reviewed and reassessed quarterly. The majority of revenue recognized over time uses an EAC process. The net aggregate effects of changes in estimates on contracts accounted for under the cost-to-cost method in the first nine months of 2020 was approximately $ i 16.6 million of favorable operating income, primarily related to favorable changes in estimates that impacted revenue within the Digital Imaging and Engineered Systems operating segments. The net aggregate effects of changes in estimates on contracts accounted for under the cost-to-cost method in the first nine months of 2019 was approximately $ i 17.0 million of favorable operating income, primarily related to favorable changes in estimates that impacted revenue, and, to a lesser degree, cost of sales within the Digital Imaging operating segment. None of the effects of changes in estimates on any individual contract were material to the condensed consolidated statements of income for any period presented.

Contract Liabilities

We recognize a liability for interim and advance payments in excess of revenue recognized and present it as a contract liability which is included within accrued liabilities and other long-term liabilities on the Condensed Consolidated Balance Sheet, which represented $ i 125.9 million and $ i 14.3 million as of September 27, 2020, and $ i 126.8 million and $ i 17.9 million as of December 29, 2019, respectively.

The Company recognized revenue of $ i 65.7 million during the nine months ended September 27, 2020 from contract liabilities that existed at the beginning of year. The Company recognizes the incremental costs of obtaining or fulfilling a contract as expense when incurred if the amortization period of the asset is one year or less. Incremental costs to obtain or fulfill contracts with an amortization period greater than one year were not material.

Remaining Performance Obligations

Remaining performance obligations represent the transaction price of firm orders for which work has not been performed as of the period end date and excludes unexercised contract options and potential orders under ordering-type contracts (e.g., indefinite-delivery, indefinite-quantity). As of September 27, 2020, the aggregate amount of the transaction price allocated to remaining performance obligations was $ i 1,742.0 million. The Company expects approximately i 74% of remaining performance obligations to be recognized into revenue within the next twelve months, with the remaining i 26% recognized thereafter.

Product Warranty Costs

Some of the Company’s products are subject to specified warranties, and the Company provides for the estimated cost of product warranties. The adequacy of the warranty reserve is assessed regularly, and the reserve is adjusted as necessary based on a review of historic warranty experience with respect to the applicable business or products, as well as the length and actual terms of the warranties. The warranty reserve is included in current and long-term accrued liabilities on the Condensed Consolidated Balance Sheet.

Nine Months

Warranty Reserve (in millions):

2020

2019

Balance at beginning of year

i 24.8

i 21.0

Accruals for product warranties charged to expense and other

i 3.1

i 7.2

Cost of product warranty claims

( i 7.7)

( i 7.6)

Acquisition

i 2.5

i 3.0

Balance at end of period

i 22.7

i 23.6

Accounts Receivable, Net

The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables (contract assets), and customer advances and deposits (contract liabilities, which are included in accrued liabilities and other long-term liabilities) on the Condensed Consolidated Balance Sheet. Under the typical payment terms of our over time contracts, the customer pays us either performance-based payments or progress payments. Amounts billed and due from our customers are classified as receivables on the Condensed Consolidated Balance Sheet. Accounts receivable is presented net of an allowance for doubtful accounts of $ i 11.4 million at September 27, 2020, and $ i 10.2 million at December 29, 2019.

An allowance for doubtful accounts is established for losses expected to be incurred on accounts receivable balances. Judgment is required in the estimation of the allowance and we evaluate the collectability of our accounts receivable and contract assets based on a combination of factors. If we become aware of a customer’s inability to meet its financial obligations, a specific allowance is recorded to reduce the net receivable to the amount reasonably believed to be collectible from the customer. For all other customers, we use an aging schedule and recognize allowances for doubtful accounts based on the creditworthiness of the debtor, the age and status of outstanding receivables, the current business environment and our historical collection experience adjusted for current expectations for the customers or industry. Accounts receivable are written off against the allowance for uncollectible accounts when we determine amounts are no longer collectible.

Nine Months

Allowance for doubtful accounts (in millions):

2020

Balance at beginning of period

i 10.2

Accruals for credit loss charged to expense

i 3.5

Other deductions

( i 2.3)

Balance at end of period

i 11.4

Note 9. i Income Taxes

The income tax provision is calculated using an estimated annual effective tax rate, based upon expected annual income, permanent items, statutory rates and planned tax strategies in the various jurisdictions in which the Company operates. However, losses in certain jurisdictions and discrete items, such as the resolution of uncertain tax positions, are treated separately.

The Company’s effective income tax rate for the third quarter and first nine months of 2020 was i 21.5% and i 17.9%, respectively. The Company's effective income tax rate for the third quarter and first nine months of 2019 was i 13.5% and i 16.7%, respectively. The third quarter and first nine months of 2020 include net discrete income tax benefits of $ i 1.2 million and $ i 15.8 million, respectively. The third quarter and first nine months of 2020 net discrete income tax benefits include $ i 0.7 million and $ i 15.2 million, respectively, related to share-based accounting. The third quarter and first nine months of 2019 include net discrete income tax benefits of $ i 10.4 million and $ i 17.8 million, respectively. The 2019 third quarter and first nine months net discrete tax benefits includes $ i 3.5 million and $ i 11.2 million, respectively, related to share-based accounting. Excluding the net discrete income tax benefits in both periods, the effective tax rates would have been i 22.5% for the third quarter and i 22.7% for the first nine months of 2020. Excluding the net discrete income tax benefits in both periods, the effective tax rates would have been i i 21.9 / % for both the third quarter and first nine months of 2019.

Note 10. i Long-Term Debt and Letters of Credit

Balance at

Long-Term Debt (in millions):

September 27, 2020

December 29, 2019

$ i i 750 / million credit facility due March 2024, weighted average rate of i 1.07% at September 27, 2020 and i 2.80% at December 29, 2019

i 125.0

Term loan due October 2024, variable rate of i 1.16% at September 27, 2020 and i 2.702% at December 29, 2019, swapped to a Euro fixed rate of i 0.6120%

i 150.0

i 5.30% Fixed Rate Senior Notes repaid September 2020

i —

i 75.0

i 2.81% Fixed Rate Senior Notes due November 2020

i 25.0

i 3.09% Fixed Rate Senior Notes due December 2021

i 95.0

i 3.28% Fixed Rate Senior Notes due November 2022

i 100.0

i 0.70% € i 50 Million Fixed Rate Senior Notes due April 2022

i 58.1

i 56.0

i 0.92% € i 100 Million Fixed Rate Senior Notes due April 2023

i 116.3

i 111.9

i 1.09% € i 100 Million Fixed Rate Senior Notes due April 2024

i 116.3

i 111.9

Other debt

i 1.9

i 2.0

Debt issuance costs

( i 0.9)

( i 1.2)

Total debt

i 786.7

i 850.6

Less: current portion of long-term debt and other debt, net

( i 25.6)

( i 100.6)

Total long-term debt

i 761.1

i 750.0

Available borrowing capacity under the $ i 750.0 million credit facility, which is reduced by borrowings and certain outstanding letters of credit, was $ i 614.7 million at September 27, 2020. The credit agreements require the Company to comply with various financial and operating covenants and at September 27, 2020, the Company was in compliance with these covenants. At September 27, 2020, Teledyne had $ i 26.4 million in outstanding letters of credit.

Teledyne estimates the fair value of its long-term debt based on debt of similar type, rating and maturity and at comparable interest rates. The Company’s long-term debt is considered a level 2 fair value hierarchy and is valued based on observable market data. The estimated fair value of Teledyne’s long-term debt at September 27, 2020 and December 29, 2019, approximated the carrying value.

Note 11. i Lease Commitments

At September 27, 2020, Teledyne has right-of-use assets of $ i 126.2 million and a total lease liability for operating leases of $ i 137.0 million of which $ i 117.0 million is included in long-term lease liabilities and $ i 20.0 million is included in current accrued liabilities. Operating lease expense was $ i 6.7 million and $ i 18.8 million for the third quarter and first nine months of 2020, respectively. Operating lease expense was $ i 6.0 million and $ i 17.6 million for the third quarter and first nine months of 2019, respectively.

Note 12. i Lawsuits, Claims, Commitments, Contingencies and Related Matters

For a further description of the Company’s commitments and contingencies, reference is made to Note 14 of the Company’s financial statements as of and for the fiscal year ended December 29, 2019, included in the 2019 Form 10-K.

At September 27, 2020, the Company’s reserves for environmental remediation obligations totaled $ i 6.6 million, of which $ i 1.5 million is included in current accrued liabilities. At December 29, 2019, the Company’s reserves for environmental remediation obligations totaled $ i 6.0 million. The Company evaluates whether it may be able to recover a portion of future costs for environmental liabilities from its insurance carriers and from third parties. The timing of expenditures depends on a number of factors that vary by site, including the nature and extent of contamination, the number of potentially responsible parties, the timing of regulatory approvals, the complexity of the investigation and remediation, and the standards for remediation. The Company expects that it will expend present accruals over many years and will complete remediation of all sites with which it has been identified in up to i 30 years.

Over the last several weeks the exposure associated with the March 27, 2020 bankruptcy of OneWeb Global Limited and its subsidiaries (“OneWeb”) has been substantially reduced. Teledyne’s customer, Airbus OneWeb Satellites, LLC (“AOS”), is a joint venture of OneWeb and Airbus Defense and Space. OneWeb has secured financing and we received an advance payment in October 2020. Additionally, we recently entered into modified contract terms and in October 2020, we resumed limited production. While some risk remains, including a successful exit by OneWeb from bankruptcy, the exposure is substantially mitigated.

A number of other lawsuits, claims and proceedings have been or may be asserted against the Company, including those pertaining to product liability, acquisitions, patent infringement, contracts, environmental, employment and employee benefits matters. While the outcome of litigation cannot be predicted with certainty, and some of these lawsuits, claims or proceedings may be determined adversely to the Company, management does not believe that the disposition of any such pending matters is likely to have a material adverse effect on the Company’s financial statements.

Note 13. i Pension Plans and Postretirement Benefits

Effective January 1, 2020, Teledyne restructured its domestic qualified defined benefit pension plan. The restructuring involved dividing our domestic qualified defined pension plan into i two separate plans, i i one / comprised primarily of inactive participants (the “inactive plan”) and the other comprised primarily of active participants (the “active plan”). The reorganization was made to efficiently facilitate a targeted investment strategy and to provide additional flexibility in evaluating opportunities to reduce risk and volatility. As a result of the restructuring, the Company re-measured the assets and liabilities of the i two plans, based on assumptions and market conditions on the January 1, 2020 effective date. Actuarial gains and losses associated with the active plan will continue to be amortized over the average remaining service period of the active participants, while the actuarial gains and losses associated with the inactive plan will be amortized over the average remaining life expectancy of the inactive participants which is currently approximately i 17.7 years.

For the domestic qualified pension plans, the weighted-average discount rate decreased to i 3.41% in 2020 compared with a i 4.59% discount rate used in 2019. Teledyne has not made any cash pension contributions to its domestic qualified pension plan since 2013. i No cash pension contributions are planned for 2020 for the domestic qualified pension plans.

Third Quarter

Nine Months

2020

2019

2020

2019

Service cost — benefits earned during the period (in millions)

i 2.6

i 2.4

i 7.8

i 7.1

Pension non-service income (in millions):

Interest cost on benefit obligation

i 6.9

i 8.4

i 20.6

i 25.2

Expected return on plan assets

( i 14.3)

( i 16.6)

( i 42.9)

( i 49.7)

Amortization of prior service cost

( i 1.5)

( i 1.4)

( i 4.5)

( i 4.4)

Amortization of net actuarial loss

i 5.7

i 7.7

i 17.2

i 23.2

Curtailment/settlements

i —

i 0.7

( i 0.4)

Pension non-service income

( i 3.2)

( i 1.9)

( i 8.9)

( i 6.1)

Teledyne sponsors several postretirement defined benefit plans that provide health care and life insurance benefits for certain eligible retirees. Postretirement benefits non-service expense is not material.

Note 14. i Segment Information

Teledyne is a leading provider of sophisticated instrumentation, digital imaging products and software, aerospace and defense electronics, and engineered systems. Our customers include government agencies, aerospace prime contractors, energy exploration and production companies, major industrial companies and airlines. The Company has i four reportable segments: Instrumentation; Digital Imaging; Aerospace and Defense Electronics; and Engineered Systems.

Segment results includes net sales and operating income by segment but excludes non-service retirement benefit income, equity income or loss, unusual non-recurring legal matter settlements, interest income and expense, gains and losses on the disposition of assets, sublease rental income and non-revenue licensing and royalty income, domestic and foreign income taxes and corporate office expenses. Corporate expense includes various administrative expenses relating to the corporate office and certain non-operating expenses, including certain acquisition-related transaction costs, not allocated to our segments.

As part of a continuing effort to reduce costs and improve operating performance, as well as to respond to the impact of COVID-19, the Company has taken actions to reduce headcount across various businesses, reducing our exposure to weak end markets, such as commercial aerospace. Teledyne incurred $ i 3.3 million and $ i 15.1 million in expense related to these actions, including facility consolidation expense, for the third quarter and first nine months of 2020 respectively, compared with $ i 0.3 million and $ i 1.1 million for the third quarter and first nine months of 2019, respectively. At September 27, 2020, Teledyne had a liability of $ i 2.4 million included in other current liabilities related to these actions.

The following table presents Teledyne’s segment disclosures (dollars in millions):

Third Quarter

Nine Months

2020

2019

Change

2020

2019

Change

Net sales(a):

Instrumentation

i 263.5

i 282.9

( i 6.9)

i 811.7

i 803.5

i 1.0

Digital Imaging

i 239.7

i 244.0

( i 1.8)

i 724.0

i 724.8

( i 0.1)

Aerospace and Defense Electronics

i 144.8

i 177.1

( i 18.2)

i 444.2

i 519.7

( i 14.5)

Engineered Systems

i 101.0

i 98.2

i 2.9

i 297.0

i 281.4

i 5.5

Total net sales

i 749.0

i 802.2

( i 6.6)

i 2,276.9

i 2,329.4

( i 2.3)

Operating income:

Instrumentation

i 50.7

i 52.0

( i 2.5)

i 150.0

i 140.9

i 6.5

Digital Imaging

i 45.5

i 41.2

i 10.4

i 136.1

i 129.4

i 5.2

Aerospace and Defense Electronics

i 26.7

i 39.5

( i 32.4)

i 57.6

i 110.6

( i 47.9)

Engineered Systems

i 12.5

i 10.6

i 17.9

i 34.7

i 26.0

i 33.5

Corporate expense

( i 12.9)

( i 14.6)

( i 11.6)

( i 42.1)

( i 49.0)

( i 14.1)

Operating income

i 122.5

i 128.7

( i 4.8)

i 336.3

i 357.9

( i 6.0)

(a) Net sales excludes inter-segment sales of $ i 5.6 million and $ i 18.0 million for the third quarter and first nine months of 2020, respectively, and $ i 8.2 million and $ i 22.2 million for the third quarter and first nine months of 2019, respectively.

Identifiable assets are those assets used in the operations of the segments. Corporate assets primarily consist of cash, deferred taxes, net pension assets/liabilities and other assets (in millions):

Identifiable assets:

September 27, 2020

December 29, 2019

Instrumentation

i 1,691.4

i 1,680.2

Digital Imaging

i 1,920.6

i 1,874.6

Aerospace and Defense Electronics

i 582.0

i 618.3

Engineered Systems

i 163.9

i 143.4

Corporate

i 479.1

i 263.3

Total identifiable assets

i 4,837.0

i 4,579.8

The Instrumentation segment includes i three product lines: Marine Instrumentation, Environmental Instrumentation and Test and Measurement Instrumentation. Teledyne’s other three segments each contain i i i one / / product line.

The following tables provide a summary of the net sales by product line for the Instrumentation segment (in millions):

Third Quarter

Nine Months

Instrumentation

2020

2019

2020

2019

Marine Instrumentation

i 101.5

i 114.4

i 320.7

i 331.0

Environmental Instrumentation

i 100.4

i 102.6

i 304.0

i 276.4

Test and Measurement Instrumentation

i 61.6

i 65.9

i 187.0

i 196.1

Total

i 263.5

i 282.9

i 811.7

i 803.5

We also disaggregate our revenue from contracts with customers by customer type, contract-type and geographic region for each of our segments, as we believe it best depicts how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors.

Third Quarter Ended September 27, 2020

Nine Months Ended September 27, 2020

Customer Type

(in millions)

United States Government (a)

Other, Primarily Commercial

Total

United States Government (a)

Other, Primarily Commercial

Total

Net Sales:

Instrumentation

i 24.1

i 239.4

i 263.5

i 59.6

i 752.1

i 811.7

Digital Imaging

i 32.0

i 207.7

i 239.7

i 91.4

i 632.6

i 724.0

Aerospace and Defense Electronics

i 58.9

i 85.9

i 144.8

i 170.5

i 273.7

i 444.2

Engineered Systems

i 89.7

i 11.3

i 101.0

i 274.5

i 22.5

i 297.0

i 204.7

i 544.3

i 749.0

i 596.0

i 1,680.9

i 2,276.9

a) Includes sales as a prime contractor or subcontractor.

Third Quarter Ended September 27, 2020

Nine Months Ended September 27, 2020

Contract Type

(in millions)

Fixed Price

Cost Type

Total

Fixed Price

Cost Type

Total

Net Sales:

Instrumentation

i 258.9

i 4.6

i 263.5

i 802.9

i 8.8

i 811.7

Digital Imaging

i 216.7

i 23.0

i 239.7

i 652.5

i 71.5

i 724.0

Aerospace and Defense Electronics

i 144.8

i —

i 144.8

i 444.0

i 0.2

i 444.2

Engineered Systems

i 54.2

i 46.8

i 101.0

i 157.2

i 139.8

i 297.0

i 674.6

i 74.4

i 749.0

i 2,056.6

i 220.3

i 2,276.9

Third Quarter Ended September 27, 2020

Nine Months Ended September 27, 2020

Geographic Region (a)

(in millions)

United States

Europe

All other

Total

United States

Europe

All other

Total

Net sales:

Instrumentation

i 208.1

i 44.8

i 10.6

i 263.5

i 637.2

i 142.8

i 31.7

i 811.7

Digital Imaging

i 75.4

i 64.4

i 99.9

i 239.7

i 231.0

i 195.0

i 298.0

i 724.0

Aerospace and Defense Electronics

i 127.3

i 17.4

i 0.1

i 144.8

i 384.3

i 59.4

i 0.5

i 444.2

Engineered Systems

i 101.0

i —

i 101.0

i 297.0

i —

i 297.0

i 511.8

i 126.6

i 110.6

i 749.0

i 1,549.5

i 397.2

i 330.2

i 2,276.9

a) Net sales by geographic region of origin.

Third Quarter Ended September 29, 2019

Nine Months Ended September 29, 2019

Customer Type

(in millions)

United States Government (a)

Other, Primarily Commercial

Total

United States Government (a)

Other, Primarily Commercial

Total

Net Sales:

Instrumentation

i 20.1

i 262.8

i 282.9

i 52.9

i 750.6

i 803.5

Digital Imaging

i 29.1

i 214.9

i 244.0

i 81.5

i 643.3

i 724.8

Aerospace and Defense Electronics

i 58.6

i 118.5

i 177.1

i 166.6

i 353.1

i 519.7

Engineered Systems

i 90.5

i 7.7

i 98.2

i 254.3

i 27.1

i 281.4

i 198.3

i 603.9

i 802.2

i 555.3

i 1,774.1

i 2,329.4

a) Includes sales as a prime contractor or subcontractor.

Third Quarter Ended September 29, 2019

Nine Months Ended September 29, 2019

Contract Type

(in millions)

Fixed Price

Cost Type

Total

Fixed Price

Cost Type

Total

Net Sales:

Instrumentation

i 280.8

i 2.1

i 282.9

i 797.5

i 6.0

i 803.5

Digital Imaging

i 220.4

i 23.6

i 244.0

i 657.7

i 67.1

i 724.8

Aerospace and Defense Electronics

i 175.9

i 1.2

i 177.1

i 517.8

i 1.9

i 519.7

Engineered Systems

i 46.0

i 52.2

i 98.2

i 120.6

i 160.8

i 281.4

i 723.1

i 79.1

i 802.2

i 2,093.6

i 235.8

i 2,329.4

Third Quarter Ended September 29, 2019

Nine Months Ended September 29, 2019

Geographic Region (a)

(in millions)

United States

Europe

All other

Total

United States

Europe

All other

Total

Net sales:

Instrumentation

i 229.9

i 42.7

i 10.3

i 282.9

i 666.1

i 107.1

i 30.3

i 803.5

Digital Imaging

i 83.4

i 71.2

i 89.4

i 244.0

i 236.1

i 213.0

i 275.7

i 724.8

Aerospace and Defense Electronics

i 149.2

i 27.7

i 0.2

i 177.1

i 447.4

i 71.5

i 0.8

i 519.7

Engineered Systems

i 98.2

i —

i 98.2

i 281.4

i —

i 281.4

i 560.7

i 141.6

i 99.9

i 802.2

i 1,631.0

i 391.6

i 306.8

i 2,329.4

a) Net sales by geographic region of origin.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Teledyne Technologies Incorporated provides enabling technologies for industrial growth markets that require advanced technology and high reliability. These markets include aerospace and defense, factory automation, air and water quality environmental monitoring, electronics design and development, oceanographic research, deepwater oil and gas exploration and production, medical imaging and pharmaceutical research. Our products include digital imaging sensors, cameras and systems within the visible, infrared and X-ray spectra, monitoring and control instrumentation for marine and environmental applications, harsh environment interconnects, electronic test and measurement equipment, aircraft information management systems, and defense electronics and satellite communication subsystems. We also supply engineered systems for defense, space, environmental and energy applications. We differentiate ourselves from many of our direct competitors by having a customer and company-sponsored applied research center that augments our product development expertise.

Our strategy continues to emphasize growth in our core markets of instrumentation, digital imaging, aerospace and defense electronics and engineered systems. Our core markets are characterized by high barriers to entry and include specialized products and services not likely to be commoditized. We intend to strengthen and expand our core businesses with targeted acquisitions and through product development. We continue to focus on balanced and disciplined capital deployment among capital expenditures, product development, acquisitions and share repurchases. We aggressively pursue operational excellence to continually improve our margins and earnings by emphasizing cost containment and cost reductions in all aspects of our business. At Teledyne, operational excellence includes the rapid integration of the businesses we acquire. Using complementary technology across our businesses and internal research and development, we seek to create new products to grow our company and expand our addressable markets. We continue to evaluate our businesses to ensure that they are aligned with our strategy.

COVID-19 and Other Matters

With regard to the COVID-19 pandemic, our first priority remains the health and safety of our employees and their families. Up to 18% of our total personnel are working from home. Our manufacturing sites remain operational, and we are practicing social distancing, enhanced cleaning protocols, usage of personal protective equipment and other preventative measures.

While no company is immune to global economic challenges, Teledyne's business portfolio is well-balanced across end markets and geographies, and includes a high degree of businesses serving critical infrastructure sectors such as the defense industrial base, water and wastewater, and healthcare and public health. Teledyne’s balance sheet is strong, with $454.5 million of cash and cash equivalents and $614.7 million available under our credit facility maturing in 2024. However, given the continuing dynamic nature of this situation, the Company may not fully estimate the impacts of COVID-19 on its financial condition, results of operations or cash flows.

Acquisition of the OakGate Technology, Inc.

On January 5, 2020, we acquired OakGate Technology, Inc. (“OakGate”) for $28.5 million in cash, net of cash acquired. Based in Loomis, California, OakGate provides software and hardware designed to test electronic data storage devices from development through manufacturing and end-use applications. The acquired business is part of the Test and Measurement product line within the Instrumentation segment.

Acquisition of Micralyne, Inc.

On August 30, 2019, we acquired Micralyne Inc. (“Micralyne”) for $26.2 million in cash, net of cash acquired and including a $0.5 million purchase price adjustment paid in January 2020. Based in Edmonton, Alberta, Canada, Micralyne is a foundry providing Micro Electro Mechanical Systems or MEMS devices. In particular, Micralyne possesses unique microfluidic technology for biotech applications, as well as capabilities in non-silicon-based MEMS (e.g. gold, polymers) often required for human body compatibility. The acquired business is part of the Digital Imaging segment.

Acquisition of the gas and flame detection business of 3M Company

On August 1, 2019, we acquired the gas and flame detection business of 3M Company for $233.5 million in cash, net of cash acquired. The gas and flame detection business includes Oldham, Simtronics, Gas Measurement Instruments, Detcon and select Scott Safety products. The gas and flame detection business provides a portfolio of fixed and portable industrial gas and flame detection instruments used in a variety of industries including petrochemical, power generation, oil and gas, food and beverage, mining and waste water treatment. Principally located in France, the United Kingdom and the United States, the acquired business is part of the Environmental product line within of the Instrumentation segment.

Acquisition of the scientific imaging businesses of Roper Technologies, Inc.

On February 5, 2019, we acquired the scientific imaging businesses of Roper Technologies, Inc. for $224.8 million in cash, net of cash acquired and including a purchase price adjustment. Principally located in the United States and Canada, the acquired businesses are part of the Digital Imaging segment. The acquired businesses include Princeton Instruments, Photometrics and Lumenera. The acquired businesses provide a range of imaging solutions, primarily for life sciences, academic research and customized OEM industrial imaging solutions. Princeton Instruments and Photometrics manufacture state-of-the-art cameras, spectrographs and optics for advanced research in physical sciences, life sciences research and spectroscopy imaging. Applications and markets include materials analysis, quantum technology and cell biology imaging using fluorescence and chemiluminescence. Lumenera primarily provides rugged USB-based customized cameras for markets such as traffic management, as well as life sciences applications.

Results of Operations


	Third Quarter						Nine Months
(in millions)	2020		2019		2020		2019
Net sales	$	749.0	$	802.2	$	2,276.9	$	2,329.4
Costs and expenses
Cost of sales	458.5		487.7		1,411.7		1,415.2
Selling, general and administrative expenses	168.0		185.8		528.9		556.3
Total costs and expenses	626.5		673.5		1,940.6		1,971.5
Operating income	122.5		128.7		336.3		357.9
Interest expense, net	(4.1)		(5.5)		(11.9)		(16.3)
Non-service retirement benefit income	3.2		1.9		8.9		6.1
Other expense, net	(1.9)		(1.7)		(4.7)		(3.5)
Income before income taxes	119.7		123.4		328.6		344.2
Provision for income taxes	25.8		16.7		58.8		57.6



Net income	$	93.9	$	106.7	$	269.8	$	286.6


	Third Quarter						%		Nine Months				%
(dollars in millions)	2020		2019		Change		2020		2019		Change
Net sales(a):
Instrumentation	$	263.5	$	282.9	(6.9)	%	$	811.7	$	803.5	1.0	%
Digital Imaging	239.7		244.0		(1.8)	%	724.0		724.8		(0.1)	%
Aerospace and Defense Electronics	144.8		177.1		(18.2)	%	444.2		519.7		(14.5)	%
Engineered Systems	101.0		98.2		2.9	%	297.0		281.4		5.5	%
Total net sales	$	749.0	$	802.2	(6.6)	%	$	2,276.9	$	2,329.4	(2.3)	%
Operating income:
Instrumentation	$	50.7	$	52.0	(2.5)	%	$	150.0	$	140.9	6.5	%
Digital Imaging	45.5		41.2		10.4	%	136.1		129.4		5.2	%
Aerospace and Defense Electronics	26.7		39.5		(32.4)	%	57.6		110.6		(47.9)	%
Engineered Systems	12.5		10.6		17.9	%	34.7		26.0		33.5	%
Corporate expense	(12.9)		(14.6)		(11.6)	%	(42.1)		(49.0)		(14.1)	%
Total operating income	$	122.5	$	128.7	(4.8)	%	$	336.3	$	357.9	(6.0)	%
(a) Net sales excludes inter-segment sales of $5.6 million and $18.0 million for the third quarter and first nine months of 2020 respectively, and $8.2 million and $22.2 million for the third quarter and first nine months of 2019.

The table below presents net sales and cost of sales by segment and total company:


	Third Quarter									Nine Months
(dollars in millions)	2020			2019			2020			2019
Instrumentation
Net sales	$	263.5		$	282.9		$	811.7		$	803.5
Cost of sales	$	147.0		$	156.6		$	452.3		$	450.2
Cost of sales as a % of net sales	55.8		%	55.4		%	55.7		%	56.0		%
Digital Imaging
Net sales	$	239.7		$	244.0		$	724.0		$	724.8
Cost of sales	$	139.0		$	144.7		$	420.3		$	421.3
Cost of sales as a % of net sales	58.0		%	59.3		%	58.1		%	58.1		%
Aerospace and Defense Electronics
Net sales	$	144.8		$	177.1		$	444.2		$	519.7
Cost of sales	$	90.6		$	105.2		$	297.8		$	308.6
Cost of sales as a % of net sales	62.6		%	59.4		%	67.0		%	59.4		%
Engineered Systems
Net sales	$	101.0		$	98.2		$	297.0		$	281.4
Costs of sales	$	81.9		$	81.2		$	241.3		$	235.1
Cost of sales as a % of net sales	81.1		%	82.7		%	81.2		%	83.5		%
Total Company
Net sales	$	749.0		$	802.2		$	2,276.9		$	2,329.4
Costs of sales	$	458.5		$	487.7		$	1,411.7		$	1,415.2
Cost of sales as a % of net sales	61.2		%	60.8		%	62.0		%	60.8		%

Third Quarter and First Nine Months Results

The following is a discussion of our 2020 third quarter and first nine months results compared with the 2019 third quarter and first nine months results. Comparisons are with the corresponding reporting period of 2019, unless noted otherwise.


(a)	Exhibits

















	Exhibit 31.1	302 Certification – Aldo Pichelli

	Exhibit 31.2	302 Certification – Susan L. Main

	Exhibit 32.1	906 Certification – Aldo Pichelli

	Exhibit 32.2	906 Certification – Susan L. Main

	Exhibit 101 (INS)	XBRL Instance Document

	Exhibit 101 (SCH)	XBRL Schema Document

	Exhibit 101 (CAL)	XBRL Calculation Linkbase Document

	Exhibit 101 (LAB)	XBRL Label Linkbase Document XBRL Schema Document

	Exhibit 101 (PRE)	XBRL Presentation Linkbase Document XBRL Schema Document

	Exhibit 101 (DEF)	XBRL Definition Linkbase Document XBRL Schema Document

	Exhibit 104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)


Exhibit Number			Description















Exhibit 31.1			302 Certification – Aldo Pichelli

Exhibit 31.2			302 Certification – Susan L. Main

Exhibit 32.1			906 Certification – Aldo Pichelli

Exhibit 32.2			906 Certification – Susan L. Main

Exhibit 101 (INS)			XBRL Instance Document

Exhibit 101 (SCH)			XBRL Schema Document

Exhibit 101 (CAL)			XBRL Calculation Linkbase Document

Exhibit 101 (DEF)			XBRL Definition Linkbase Document XBRL Schema Document

Exhibit 101 (LAB)			XBRL Label Linkbase Document XBRL Schema Document

Exhibit 101 (PRE)			XBRL Presentation Linkbase Document XBRL Schema Document

Exhibit 104			Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

This ‘10-Q’ Filing	Date	Other Filings

	12/31/20	11-K, SD
Filed as of:	10/22/20
Filed on:	10/21/20	8-K
	10/20/20	3, 4, 8-K
For Period end:	9/27/20
	6/28/20	10-Q
	3/29/20	10-Q
	3/27/20
	1/5/20
	1/1/20
	12/30/19
	12/29/19	10-K
	9/29/19	10-Q
	8/30/19
	8/1/19	4, 8-K
	6/30/19	10-Q
	3/31/19	10-Q
	2/5/19	8-K
	12/30/18	10-K
		List all Filings

Teledyne Technologies Inc. – ‘10-Q’ for 9/27/20

On: Wednesday, 10/21/20, at 6:11pm ET · As of: 10/22/20 · For: 9/27/20 · Accession #: 1094285-20-163 · File #: 1-15295

Previous ‘10-Q’: ‘10-Q’ on 7/23/20 for 6/28/20 · Next: ‘10-Q’ on 4/30/21 for 4/4/21 · Latest: ‘10-Q’ on 4/29/24 for 3/31/24

Quarterly Report — Form 10-Q
Filing Table of Contents

‘10-Q’ — Quarterly Report
Document Table of Contents

This is an HTML Document rendered as filed. [ Alternative Formats ]

Dates Referenced Herein and Documents Incorporated by Reference


		PAGE
Part I	Financial Information	2

	Item 1. Financial Statements	2

	Condensed Consolidated Statements of Income	2

	Condensed Consolidated Statements of Comprehensive Income	2

	Condensed Consolidated Balance Sheets	3

	Condensed Consolidated Statements of Stockholders' Equity	4

	Condensed Consolidated Statements of Cash Flows	5

	Notes to Condensed Consolidated Financial Statements	6

	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	20

	Item 3. Quantitative and Qualitative Disclosures About Market Risk	29

	Item 4. Controls and Procedures	30

Part II	Other Information	30

	Item 1. Legal Proceedings	30

	Item 1A. Risk Factors	30





	Item 6. Exhibits	31

Signatures		32

Teledyne Technologies Inc. – ‘10-Q’ for 9/27/20

On: Wednesday, 10/21/20, at 6:11pm ET · As of: 10/22/20 · For: 9/27/20 · Accession #: 1094285-20-163 · File #: 1-15295

Previous ‘10-Q’: ‘10-Q’ on 7/23/20 for 6/28/20 · Next: ‘10-Q’ on 4/30/21 for 4/4/21 · Latest: ‘10-Q’ on 4/29/24 for 3/31/24

Quarterly Report — Form 10-QFiling Table of Contents

‘10-Q’ — Quarterly ReportDocument Table of Contents

This is an HTML Document rendered as filed. [ Alternative Formats ]

Dates Referenced Herein and Documents Incorporated by Reference

Quarterly Report — Form 10-Q
Filing Table of Contents

‘10-Q’ — Quarterly Report
Document Table of Contents