Moog Reports Second Quarter Earnings of $23.7 Million

EAST AURORA, N.Y., April 24  /PRNewswire-FirstCall/ -- Moog Inc. (NYSE: MOG.ANYSE:andNYSE:MOG.B) today announced second quarter earnings of $23.7 million, and earnings per share of $.55, down 17% from last year's second quarter.  Sales of $453 million were down 3% from a year ago.  This is the first quarter in 14 years that the Company has been unable to report an increase in quarterly earnings.  The Company's situation reflects the impact of the global economic recession, particularly as it affects the Company's industrial business in Europe and Asia.

Total Aircraft sales in the quarter of $162 million were unchanged from a year ago.  Military aircraft sales of $107 million were up 9%.  Production activity increased on the F-18 Fighter, the V-22 Tilt Rotor aircraft and the Blackhawk helicopter.  Revenues on the F-35 Joint Strike Fighter development program are winding down.  Much of the development work is complete.  The flight test aircraft for two configurations of the F-35 are in the air and the Company's flight control actuation systems are performing very well.  Military aftermarket sales in the quarter increased 26% to $35.8 million.

The Company's commercial aircraft sales in the quarter, at $53.3 million, were down $10 million from last year.  Most of this change was the result of lower sales to Boeing Commercial.  Activity on the 7-series production aircraft has slowed somewhat and the production ramp up on the new 787 airplane has been delayed.  Revenue on business jet programs actually increased slightly in the quarter, but commercial aftermarket sales at $18.8 million were down 16% from a year ago.

The Space and Defense segment had a very strong quarter with sales of $68 million.  Last year's second quarter had the benefit of extraordinary sales volume on the Driver Vision Enhancer system for the MRAP vehicles, which provided $18 million in sales.  That program is now 10% of that level, but most other Space and Defense product lines had increased sales.  Sales of controls for satellites were up 17%.  Revenue in launch vehicles, strategic and tactical missiles, and missile defense were, in total, up 19%.  Sales of defense controls, other than the Driver Vision Enhancer, were up 69%, reflecting increased activity on the Stryker mobile gun system and a number of European platforms.  The Constellation Program, NASA's replacement for the Space Shuttle system, experienced a temporary slowdown while NASA develops its requirements for the Orion Crew Vehicle.

The Industrial Systems segment is the part of the Company most affected by the global industrial recession.  Sales in the quarter of $105 million were down 20% from a year ago.  Sales of controls for plastic making machinery were down 59% and metal forming was down 45%.  Many of the Company's customers for these products are suppliers to the auto and construction industries all around the globe, and demand for their products has slowed dramatically.  On a more positive note, power generation sales were up 32% from a year ago and test equipment sales were up 16%.

Sales for the Components Group of $85 million were at the same level as last year's second quarter.  Within the same sales total, however, there were some big swings.  Total sales of aircraft and space and defense products were up 16% from a year ago.  Marine product sales were about the same as last year but medical and industrial product sales were down 15% and 29%, respectively.  The biggest sales increase was in military aircraft.  Sales were up 35% to $26 million driven by the Guardian program.  The Guardian system is a Northrop Grumman program which protects aircraft from shoulder fired missiles.

The Medical Devices segment had sales of $34 million, a 50% improvement over the same quarter last year.  Of the $11 million increase, $6.7 million was revenue from the recently acquired companies AITECS and Ethox. Sales in the quarter of intravenous and enteral pumps were up 30% and administration set revenues were up 24%.

The Company's twelve month backlog of $913 million is up 6% from a year ago.

The Company has confirmed the earnings guidance it provided on April 9th with a slight modification to sales.  Total sales for fiscal '09 are now projected at $1.841 billion with net earnings forecasted at $83.5 million, and earnings per share estimated at $1.95 with a range of plus or minus $.20.

"Last year our Industrial Systems segment was our biggest profit producer," said R. T. Brady, Chairman and CEO.  "Despite a slowdown in some major industrial markets, the segment will be profitable this year, but not at the same level.  On the positive side, our Military Aircraft and Space and Defense product lines, including those in the Components Group, are performing very well.  As a result, in the midst of a global economic recession, we hope to earn over $83 million, or 4.5% of sales."

Moog Inc. is a worldwide designer, manufacturer, and integrator of precision control components and systems.  Moog's high-performance systems control military and commercial aircraft, satellites and space vehicles, launch vehicles, missiles, automated industrial machinery, marine and medical equipment.  Additional information about the company can be found at http://www.moog.com/.

Cautionary Statement

Information included herein or incorporated by reference that does not consist of historical facts, including statements accompanied by or containing words such as "may," "will," "should," "believes," "expects," "expected," "intends," "plans," "projects," "estimates," "predicts," "potential," "outlook," "forecast," "anticipates," "presume" and "assume," are forward-looking statements. Such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are not guarantees of future performance and are subject to several factors, risks and uncertainties, the impact or occurrence of which could cause actual results to differ materially from the expected results described in the forward-looking statements. These important factors, risks and uncertainties include (i) fluctuations in general business cycles for commercial aircraft, military aircraft, space and defense products, industrial capital goods and medical devices, (ii) our dependence on government contracts that may not be fully funded or may be terminated, (iii) our dependence on certain major customers, such as The Boeing Company, for a significant percentage of our sales, (iv) the possibility that the demand for our products may be reduced if we are unable to adapt to technological change, (v) intense competition which may require us to lower prices or offer more favorable terms of sale, (vi) our indebtedness which could limit our operational and financial flexibility, (vii) the possibility that new product and research and development efforts may not be successful which could reduce our sales and profits, (viii) increased cash funding requirements for pension plans, which could occur in future years based on assumptions used for our defined benefit pension plans, including returns on plan assets and discount rates, (ix) a write-off of all or part of our goodwill, which could adversely affect our operating results and net worth and cause us to violate covenants in our bank agreements, (x) the potential for substantial fines and penalties or suspension or debarment from future contracts in the event we do not comply with regulations relating to defense industry contracting, (xi) the potential for cost overruns on development jobs and fixed price contracts and the risk that actual results may differ from estimates used in contract accounting, (xii) the possibility that our subcontractors may fail to perform their contractual obligations, which may adversely affect our contract performance and our ability to obtain future business, (xiii) our ability to successfully identify and consummate acquisitions, and integrate the acquired businesses and the risks associated with acquisitions, including that the acquired businesses do not perform in accordance with our expectations, and that we assume unknown liabilities in connection with the acquired businesses for which we are not indemnified, (xiv) our dependence on our management team and key personnel, (xv) the possibility of a catastrophic loss of one or more of our manufacturing facilities, (xvi) the possibility that future terror attacks, war or other civil disturbances could negatively impact our business, (xvii) that our operations in foreign countries could expose us to political risks and adverse changes in local, legal, tax and regulatory schemes, (xviii) the possibility that government regulation could limit our ability to sell our products outside the United States, (xix) product quality or patient safety issues with respect to our medical devices business that could lead to product recalls, withdrawal from certain markets, delays in the introduction of new products, sanctions, litigation, declining sales or actions of regulatory bodies and government authorities, (xx) the impact of product liability claims related to our products used in applications where failure can result in significant property damage, injury or death and in damage to our reputation, (xxi) the possibility that litigation may result unfavorably to us, (xxii) our ability to adequately enforce our intellectual property rights and the possibility that third parties will assert intellectual property rights that prevent or restrict our ability to manufacture, sell, distribute or use our products or technology, (xxiii) foreign currency fluctuations in those countries in which we do business and other risks associated with international operations, (xxiv) the cost of compliance with environmental laws, (xxv) the risk of losses resulting from maintaining significant amounts of cash and cash equivalents at financial institutions that are in excess of amounts insured by governments, (xxvi) the inability to utilize amounts available to us under our credit facilities given uncertainties in the credit markets and (xxvii) our customer's inability to pay us due to adverse economic conditions or their inability to access available credit. The factors identified above are not exhaustive. New factors, risks and uncertainties may emerge from time to time that may affect the forward-looking statements made herein. Given these factors, risks and uncertainties, investors should not place undue reliance on forward-looking statements as predictive of future results. We disclaim any obligation to update the forward-looking statements made in this report.

                                 MOOG INC.
                      CONSOLIDATED STATEMENTS OF EARNINGS
                 (dollars in thousands, except per share data)

                                  Three Months Ended     Six Months Ended
                                 March 28,  March 29,   March 28,  March 29,
                                    2009      2008        2009      2008


  Net sales                      $453,335   $468,838    $899,423   $915,245
  Cost of sales                   317,563    319,203     625,803    617,980
  Gross profit                    135,772    149,635     273,620    297,265

  Research and development         24,192     26,076      49,322     50,168
  Selling, general and
   administrative                  68,806     72,939     138,005    144,221
  Interest                          9,422      9,223      19,023     18,935
  Equity in earnings of LTi
   and other                       (3,150)    (1,131)     (5,605)    (1,017)
                                   99,270    107,107     200,745    212,307

  Earnings before income taxes     36,502     42,528      72,875     84,958

  Income taxes                     12,810     13,900      18,913     28,655

  Net earnings                    $23,692    $28,628     $53,962    $56,303

  Net earnings per share
     Basic                         $ 0.56      $0.67      $ 1.27     $ 1.32
     Diluted                       $ 0.55      $0.66      $ 1.26     $ 1.30

  Average common shares
   outstanding
     Basic                     42,535,691 42,601,255  42,571,490 42,543,291
     Diluted                   42,823,791 43,242,298  42,904,940 43,250,479



                                   MOOG INC.
                    CONSOLIDATED SALES AND OPERATING PROFIT
                            (dollars in thousands)

                                  Three Months Ended   Six Months Ended
                                  March 28,  March 29, March 28, March 29,
                                    2009      2008      2009       2008
  Net Sales
     Aircraft Controls            $162,025  $161,616  $325,173  $321,197
     Space and Defense Controls     68,320    70,086   139,702   127,433
     Industrial Systems            104,512   130,176   214,547   252,909
     Components                     84,504    84,241   166,008   163,828
     Medical Devices                33,974    22,719    53,993    49,878
  Net sales                       $453,335  $468,838  $899,423  $915,245

  Operating Profit and Margins
     Aircraft Controls             $14,519   $14,255   $28,019   $29,343
                                       9.0%      8.8%      8.6%      9.1%
     Space and Defense Controls      9,806     9,143    23,386    15,843
                                      14.4%     13.0%     16.7%     12.4%
     Industrial Systems             10,860    18,284    22,359    36,177
                                      10.4%     14.0%     10.4%     14.3%
     Components                     15,049    14,584    30,050    29,420
                                      17.8%     17.3%     18.1%     18.0%
     Medical Devices                   (77)      349    (2,301)    3,936
                                      (0.2%)     1.5%     (4.3%)     7.9%
  Total operating profit            50,157    56,615   101,513   114,719
                                      11.1%     12.1%     11.3%     12.5%

  Deductions from Operating Profit
     Interest expense                9,422     9,223    19,023    18,935
     Equity-based compensation
      expense                        1,031       682     3,620     2,310
     Corporate expenses and other    3,202     4,182     5,995     8,516
  Earnings before Income Taxes     $36,502   $42,528   $72,875   $84,958



                                   MOOG INC.
                        CONSOLIDATED BALANCE SHEETS
                          (dollars in thousands)

                                               March 28,  September 27,
                                                 2009        2008

   Cash                                         $68,258     $86,814
   Receivables                                  521,297     517,361
   Inventories                                  434,299     408,295
   Other current assets                          87,493      77,915
        Total current assets                  1,111,347   1,090,385
   Property, plant and equipment                440,582     428,120
   Goodwill and intangible assets               757,692     635,490
   Other non-current assets                      70,961      73,252
        Total assets                         $2,380,582  $2,227,247


   Notes payable                                $11,170      $7,579
   Current installments of long-term debt         1,309       1,487
   Contract loss reserves                        20,000      20,536
   Other current liabilities                    345,388     347,491
        Total current liabilities               377,867     377,093
   Long-term debt                               787,317     661,994
   Other long-term liabilities                  204,105     193,750
        Total liabilities                     1,369,289   1,232,837
   Shareholders' equity                       1,011,293     994,410
        Total liabilities and shareholders'
         equity                              $2,380,582  $2,227,247


DATASOURCE: Moog Inc.



CONTACT:  Ann Marie Luhr of Moog Inc., [phone]



Web Site:  http://www.moog.com/ 

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