Teledyne announces third quarter results, C-Suite changes
It was another quarter of growth for Thousand Oaks-based Teledyne, with sales and earnings both increasing — but the biggest news announced by the technology and defense conglomerate was actually a change in the C-Suite.
Robert Mehrabian, the longtime Teledyne executive, will be stepping down from his post as CEO on Jan. 1 and moving into an executive chairman role, the company announced in a Oct. 24 press release.
As per the contract agreement, Mehrabian will remain at Teledyne for an additional three years, through 2026, with his new role keeping him active with the company with a focus on strategy, technology, mergers and acquisitions and margin expansion programs.
Taking over his role will be Edwin Roks, who will assume the role of Chief Executive Officer, while George C. Bobb III will assume the role of President and Chief Operating Officer, the press release stated.
Roks is currently the executive vice president of Teledyne, leading the company’s successful digital imaging segment, including through the company’s biggest acquisition of Flir Technologies a couple years back.
Bobb III is also an executive vice president of Teledyne, leading the company’s aerospace and defense electronics segment, the marine instrumentation group, the engineered systems segment and Teledyne scientific & imaging.
“I want to congratulate Edwin and George on their well-deserved promotions to CEO and President and COO, respectively,” Robert Mehrabian, Chairman, President and Chief Executive Officer, said in a press release.
“I will work side by side with them to continue the development and execution of Teledyne’s growth strategy.”
Teledyne announced the C-Suite changes after the markets closed on Oct. 24, with shares closing at $386.56 and opening slightly lower the next market open at $383.56.
Shares dipped further on Oct. 25 after the company’s third quarter earnings despite positive numbers. The stock fell as low as 3% with shares hovering above $373 on Oct. 25.
For the quarter ended Sept. 30, Teledyne posted net sales worth $1.4 billion, a 2.5% increase from the year prior.
Although, the company’s revenue did miss analyst expectations by about $30 million, according to Zacks Consensus Estimate.
Net income attributable to Teledyne was $198.6 million, or $4.15 diluted earnings per share, for the third quarter of 2023, compared with $178.3 million, or $3.74 diluted earnings per share, for the third quarter of 2022, an increase of 11.4%.
Non-GAAP earnings per share were $5.05, the company stated, beating analysts expectations by roughly 29 cents, according to Zacks Consensus Estimate.
Teledyne also delivered a record third quarter operating margin of 18.8% while the company’s non-GAAP operating margin of 22.8% is the company’s best mark in any quarter.
“The results across Teledyne were once again driven by our balanced business portfolio. Our overall performance was led by growth in our marine, medical, aerospace and certain defense businesses, coupled with vigilant cost control,” Mehrabian said.
The CEO noted that while sales increased, revenue was impacted by a stronger U.S. dollar throughout the third quarter with some deterioration in certain end markets, such as industrial automation and laboratory instrumentation.
“Nevertheless, given our focus on operational excellence, operating margin increased sequentially and year-over-year in the Digital Imaging and Instrumentation segments, helping generate record earnings,” he said.
Mehrabian also highlighted the company’s latest acquisition, Xena Networks, for an undisclosed amount on Oct. 3, stating that the purchase will help the company’s test and measurement business and added that it “has continued to perform very well in a challenging environment.”
Sales for the company’s digital imaging segment fell less than 1% to be at $775.8 million. On a positive note, $25.8 million in incremental sales were from recent acquisitions, as well as greater sales of x-ray products, infrared imaging detectors and surveillance systems.
These were offset by lower sales of unmanned ground systems for defense applications, micro-electro-mechanical systems (“MEMS”), commercial maritime products and industrial imaging cameras.
Teledyne’s sales for its instrumentation segment grew about 7% to $329.1 million while sales for its aerospace and defense electronics segment grew 8% to $183.3 million.
Teledyne ended the quarter with cash and cash equivalents worth $508.6 million.