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

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

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes þ No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 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 ¨ No þ

As of September ~~2, 2014, 31,939,799~~3, 2015, 29,545,713 shares of the issuer’s common stock were outstanding.

					July 31,		October 31,
	August 1,		October 25,		2015		2014
	2014		2013		(Unaudited)
ASSETS	(Unaudited)

Current Assets
Cash and cash equivalents	$	210,456	$	179,178	$	187,682	$	238,144
Cash in escrow		-		4,018
Accounts receivable, net of allowances of $9,946 and $9,215		361,827		383,666
Accounts receivable, net of allowances of $10,397 and $10,023						373,699		379,889
Inventories
Raw materials and purchased parts		181,885		165,231		174,346		165,839
Work in progress		206,935		182,882		191,519		178,354
Finished goods		104,992		99,550		103,835		89,402
		493,812		447,663		469,700		433,595

Income tax refundable		7,681		6,526		17,515		5,266
Deferred income tax benefits		50,716		47,277		36,945		48,679
Prepaid expenses		24,816		18,183		21,407		20,336
Other current assets		4,286		5,204		17,196		2,149
Current assets of businesses held for sale						14,398		41,446
Total Current Assets		1,153,594		1,091,715		1,138,542		1,169,504

Property, Plant and Equipment		790,516		767,861		723,746		721,460
Accumulated depreciation		427,311		396,664		417,355		402,118
		363,205		371,197		306,391		319,342

Other Non-Current Assets
Goodwill		1,132,987		1,128,977		1,040,443		1,071,786
Intangibles, net		560,893		580,949		459,968		471,377
Debt issuance costs, net of accumulated amortization of $5,400 and $4,359		4,637		6,211
Debt issuance costs, net of accumulated amortization of $2,789 and $5,743						11,035		4,295
Deferred income tax benefits		68,416		71,840		75,612		71,307
Other assets		24,726		11,223		22,103		14,179
	$	3,308,458	$	3,262,112
Non-current assets of businesses held for sale						31,558		71,677
Total Assets					$	3,085,652	$	3,193,467

							July 31,			October 31,
	August 1,			October 25,			2015			2014
	2014			2013			(Unaudited)
LIABILITIES AND SHAREHOLDERS' EQUITY	(Unaudited)

Current Liabilities
Accounts payable	$	123,376		$	123,597		$	111,415		$	115,284
Accrued liabilities		238,968			253,561			267,386			262,536
Current maturities of long-term debt		12,822			21,279			1,014			12,774
Deferred income tax liabilities		3,205			2,307			2,993			1,773
Federal and foreign income taxes		2,309			7,348			3,853			1,571
Current liabilities of businesses held for sale								8,885			14,191
Total Current Liabilities		380,680			408,092			395,546			408,129

Long-Term Liabilities
Credit facilities		115,000			130,000			200,000			100,000
Long-term debt, net of current maturities		513,119			537,859			712,809			509,720
Deferred income tax liabilities		178,796			193,119			133,499			149,165
Pension and post-retirement obligations		62,759			68,102			56,758			62,693
Other liabilities		47,313			40,188			30,512			46,884
Non-current liabilities of businesses held for sale								1,859			18,876

Shareholders' Equity
Common stock, par value $.20 per share, authorized 60,000,000 shares, issued and outstanding 31,996,510 and 31,441,949 shares		6,399			6,288
Common stock, par value $.20 per share, authorized 60,000,000 shares, issued 32,365,349 and 32,123,717 shares								6,473			6,425
Additional paid-in capital		648,974			604,511			679,647			655,723
Treasury stock at cost, repurchased 45,979 and 0 shares		(5,176	)		-
Treasury stock at cost, repurchased 2,831,350 and 269,228 shares								(289,780	)		(30,262	)
Retained earnings		1,390,980			1,285,090			1,444,134			1,387,508
Accumulated other comprehensive loss		(42,012	)		(22,284	)		(295,835	)		(131,577	)
Total Esterline shareholders' equity		1,999,165			1,873,605
Total Esterline Shareholders' Equity								1,544,639			1,887,817
Noncontrolling interests		11,626			11,147			10,030			10,183
Total Shareholders' Equity		2,010,791			1,884,752			1,554,669			1,898,000
	$	3,308,458		$	3,262,112
Total Liabilities and Shareholders' Equity							$	3,085,652		$	3,193,467

For the Three and Nine Month Periods Ended July 31, 2015 and August 1, 2014 ~~and July 26, 2013~~

		Three Months Ended						Nine Months Ended							Three Months Ended						Nine Months Ended
		August 1,			July 26,			August 1,			July 26,				July 31,			August 1,			July 31,			August 1,
		2014			2013			2014			2013				2015			2014			2015			2014

Net Sales		$	531,124		$	478,068		$	1,565,678		$	1,435,592			$	496,217		$	506,309		$	1,442,641		$	1,503,110
Cost of Sales			348,651			299,166			1,027,565			914,969				326,421			329,222			963,844			976,063
			182,473			178,902			538,113			520,623				169,796			177,087			478,797			527,047
Expenses
Selling, general & administrative			95,293			101,822			289,969			298,711				91,968			88,884			286,366			270,051
Research, development and engineering			25,134			24,103			78,441			72,837				29,245			24,259			78,700			75,441
Restructuring charges			3,405			-			10,279			-				1,403			3,405			5,375			10,279
Goodwill impairment			-			3,454			-			3,454
Other (income) expense																-			-			(12,744	)		-
Total Expenses			123,832			129,379			378,689			375,002				122,616			116,548			357,697			355,771

Operating Earnings from Continuing Operations			58,641			49,523			159,424			145,621				47,180			60,539			121,100			171,276
Interest Income			(146	)		(132	)		(403	)		(381	)			(144	)		(145	)		(447	)		(400	)
Interest Expense			7,870			9,050			24,939			30,976				10,618			7,865			25,023			24,924
Loss on Extinguishment of Debt			533			-			533			946				-			533			329			533

Earnings from Continuing Operations Before Income Taxes			50,384			40,605			134,355			114,080				36,706			52,286			96,195			146,219
Income Tax Expense			11,430			1,151			27,693			13,027				6,405			12,403			19,097			31,415
Earnings from Continuing Operations Including Noncontrolling Interests			38,954			39,454			106,662			101,053				30,301			39,883			77,098			114,804

Earnings Attributable to Noncontrolling Interests			(46	)		(241	)		(429	)		(1,207	)			(111	)		(46	)		(218	)		(429	)
Earnings from Continuing Operations Attributable to Esterline, Net of Tax			38,908			39,213			106,233			99,846				30,190			39,837			76,880			114,375

Loss from Discontinued Operations Attributable to Esterline, Net of Tax			-			(975	)		(343	)		(975	)			(1,693	)		(929	)		(20,254	)		(8,485	)

Net Earnings Attributable to Esterline		$	38,908		$	38,238		$	105,890		$	98,871			$	28,497		$	38,908		$	56,626		$	105,890

Earnings (Loss) Per Share Attributable to Esterline - Basic:	Earnings (Loss) Per Share Attributable to Esterline - Basic:													Earnings (Loss) Per Share Attributable to Esterline - Basic:
Continuing operations		$	1.22		$	1.25		$	3.34		$	3.21			$	1.00		$	1.25		$	2.48		$	3.60
Discontinued operations			-			(0.03	)		(0.01	)		(0.03	)			(0.06	)		(0.03	)		(0.65	)		(0.27	)
Earnings (Loss) Per Share Attributable to Esterline - Basic		$	1.22		$	1.22		$	3.33		$	3.18			$	0.94		$	1.22		$	1.83		$	3.33

Earnings (Loss) Per Share Attributable to Esterline - Diluted:	Earnings (Loss) Per Share Attributable to Esterline - Diluted:													Earnings (Loss) Per Share Attributable to Esterline - Diluted:
Continuing operations		$	1.19		$	1.23		$	3.28		$	3.15			$	0.97		$	1.22		$	2.44		$	3.53
Discontinued operations			-			(0.03	)		(0.01	)		(0.03	)			(0.05	)		(0.03	)		(0.64	)		(0.26	)
Earnings (Loss) Per Share Attributable to Esterline - Diluted		$	1.19		$	1.20		$	3.27		$	3.12			$	0.92		$	1.19		$	1.80		$	3.27

Comprehensive Income (Loss)		$	16,479		$	45,201		$	86,162		$	83,459			$	(990	)	$	16,479		$	(107,632	)	$	86,162

For the Nine Month Periods Ended July 31, 2015 and August 1, 2014 ~~and July 26, 2013~~

	Nine Months Ended						July 31,			August 1,
	August 1,			July 26,			2015			2014
	2014			2013
Cash Flows Provided (Used) by Operating Activities
Net earnings including noncontrolling interests	$	106,319		$	100,078		$	56,844		$	106,319
Adjustments to reconcile net earnings including noncontrolling interests to net cash provided (used) by operating activities:
Depreciation and amortization		87,443			87,941			77,310			87,443
Deferred income taxes		(13,104	)		(12,238	)		(9,333	)		(13,104	)
Share-based compensation		9,833			7,667			8,618			9,833
Gain on sale of capital assets		-			(915	)
Goodwill impairment		-			3,454
Gain on release of non-income tax liability								(15,656	)		-
Loss on assets held for sale								16,963			-
Working capital changes, net of effect of acquisitions:
Accounts receivable		23,480			51,063			17,943			23,480
Inventories		(42,411	)		(32,774	)		(18,313	)		(42,411	)
Prepaid expenses		(6,202	)		(135	)		(2,588	)		(6,202	)
Other current assets		(99	)		(836	)		142			(99	)
Accounts payable		(4,508	)		5,424			(16,809	)		(4,508	)
Accrued liabilities		(16,458	)		4,277			(7,189	)		(16,458	)
Federal and foreign income taxes		(7,983	)		(5,321	)		(8,501	)		(7,983	)
Other liabilities		(1,440	)		(10,394	)		3,243			(1,440	)
Other, net		(155	)		(1,012	)		1,526			(155	)
		134,715			196,279			104,200			134,715

Cash Flows Provided (Used) by Investing Activities
Purchase of capital assets		(35,009	)		(37,765	)		(37,777	)		(35,009	)
Proceeds from sale of capital assets		-			915
Acquisition of business, net of cash acquired		(44,745	)		(40,689	)
Proceeds from sale of discontinued operations								32,053			-
Acquisition of businesses, net of cash acquired								(171,070	)		(44,745	)
								(176,794	)		(79,754	)
		(79,754	)		(77,539	)
Cash Flows Provided (Used) by Financing Activities
Proceeds provided by stock issuance under employee stock plans		23,173			20,450			13,477			23,173
Excess tax benefits from stock option exercises		6,392			2,237			1,877			6,392
Share repurchases		(5,176	)		-
Shares repurchased								(259,518	)		(5,176	)
Repayment of long-term credit facilities		(40,000	)		(70,000	)		(235,000	)		(40,000	)
Repayment of long-term debt		(34,076	)		(209,541	)		(167,065	)		(34,076	)
Proceeds from issuance of long-term credit facilities		25,000			175,000			335,000			25,000
Proceeds from issuance of long-term debt								356,532			-
Proceeds from government assistance		3,362			5,114			3,054			3,362
Dividends paid to noncontrolling interests		(780	)		(1,044	)		-			(780	)
Debt and other issuance costs		-			(453	)		(8,213	)		-
		(22,105	)		(78,237	)		40,144			(22,105	)

Effect of Foreign Exchange Rates on Cash and Cash Equivalents		(1,578	)		(1,930	)		(18,012	)		(1,578	)
Net Increase (Decrease) in Cash and Cash Equivalents		31,278			38,573			(50,462	)		31,278

Cash and Cash Equivalents - Beginning of Period		179,178			160,675
Cash and Cash Equivalents - Beginning of Year								238,144			179,178
Cash and Cash Equivalents - End of Period	$	210,456		$	199,248		$	187,682		$	210,456

Supplemental Cash Flow Information:
Cash paid for interest	$	26,066		$	25,873		$	15,939		$	26,066
Cash paid for taxes		49,036			30,608			29,790			49,036

For the Three and Nine Month Periods Ended July 31, 2015 and August 1, 2014 ~~and July 26, 2013~~

The consolidated balance sheet as of ~~August 1, 2014,~~July 31, 2015, the consolidated statement of operations and comprehensive income (loss) for the three and nine month periods ended July 31, 2015, and August 1, 2014, ~~and July 26, 2013,~~ and the consolidated statement of cash flows for the nine month periods ended July 31, 2015, and August 1, 2014, ~~and July 26, 2013,~~ are unaudited but, in the opinion of management, all of the necessary adjustments, consisting of normal recurring accruals, have been made to present fairly the financial statements referred to above in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the above statements do not include all of the footnotes required for complete financial statements. The results of operations and cash flows for the interim periods presented are not necessarily indicative of results that can be expected for the full year.

The notes to the consolidated financial statements in the Company’s Annual Report on Form 10-K for the fiscal year ended October ~~25, 2013,~~31, 2014, provide a summary of significant accounting policies and additional financial information that should be read in conjunction with this Form 10-Q.

The timing of the Company’s revenues is impacted by the purchasing patterns of customers and, as a result, revenues are not generated evenly throughout the year. Moreover, the Company’s first fiscal quarter, November through January, includes significant holiday periods in both Europe and North America. The first nine months of fiscal ~~2014 contained 40~~2015 was 39 weeks, while the first nine months of fiscal ~~2013 contained 39~~2014 was 40 weeks.

On June 5, 2014, the Company’s board of directors authorized a change in the Company’s fiscal year end to the last Friday of September from the last Friday in ~~October, effective for fiscal year 2016.~~October. The Company plans to report its financial results for the 11-month transition period of November 1, 2014, through October 2, 2015, on an Annual Report on Form 10-K and to thereafter file its annual report for each ~~twelve-month~~12-month period ending the last Friday of September of each year, beginning with the ~~twelve-month~~12-month period ending September 30, 2016. ~~The Company’s fiscal year 2014 remains unchanged and will end on October 31, 2014.~~

In ~~May~~April 2014, the Financial Accounting Standards Board (FASB) issued guidance that modifies the criteria used to qualify divestitures for classification as discontinued operations and expands disclosure related to disposals of significant components. The amendment will become effective for the Company in fiscal 2016, with early adoption permitted; however, the Company does not expect to early adopt the amended guidance. The amended guidance is expected to decrease the likelihood that future disposals will qualify for discontinued operations treatment, meaning that the results of operation of some future disposals may be reported as continuing operations.

In May 2014, FASB amended requirements for an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The updated standard will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective and permits the use of either the retrospective or cumulative effect transition method. Early adoption is ~~not~~ permitted. The updated standard becomes effective for the Company in the first fiscal quarter of ~~2018.~~2019. The Company has not yet selected a transition method and is currently evaluating the effect that the updated standard will have on consolidated financial statements and related disclosures.

In April 2015, FASB amended requirements related to the presentation of debt issuance costs. The updated standard requires debt issuance costs related to recognized debt liability to be presented in the balance sheet as a direct deduction from the carrying amount of the related debt liability instead of being presented as an asset. The recognition and measurement of debt issuance costs are not affected by this amendment. The updated standard is effective for the Company in the first fiscal quarter of 2016. The Company does not expect that the standard will have a material impact on its consolidated financial statements and related disclosures.

Basic earnings per share is computed on the basis of the weighted average number of shares outstanding during the year. Diluted earnings per share includes the dilutive effect of stock options and restricted stock units. Common shares issuable from stock options excluded from the calculation of diluted earnings per share because they were anti-dilutive were ~~170,300~~370,050 and ~~219,800~~170,300 in the third fiscal quarter of ~~2014~~2015 and ~~2013,~~2014, respectively. Shares used for calculating earnings per share are disclosed in the following ~~table.~~table:

(In thousands)	Three Months Ended				Nine Months Ended
In Thousands									Three Months Ended				Nine Months Ended
									July 31,		August 1,		July 31,		August 1,
	August 1,		July 26,		August 1,		July 26,		2015		2014		2015		2014
	2014		2013		2014		2013
Shares used for basic earnings per share		31,995		31,297		31,818		31,100		30,397		31,995		31,003		31,818
Shares used for diluted earnings per share		32,591		31,870		32,427		31,663		30,914		32,591		31,531		32,427

The authorized capital stock of the Company consists of 25,000 shares of preferred stock ($100 par value), 475,000 shares of serial preferred stock ($1.00 par value), each issuable in series, and 60,000,000 shares of common stock ($.20 par value). As of July 31, 2015, and October 31, 2014, there were no shares of preferred stock or serial preferred stock outstanding.

On June 19, 2014, the Company’s board of directors approved a $200 million share repurchase program. In March 2015, the Company’s board of directors approved an additional $200 million for the share repurchase program. Under the program, the Company is authorized to repurchase up to ~~$200~~$400 million of outstanding shares of common stock from time to time, depending on market conditions, share price and other factors. Repurchases may be made in the open market or through private transactions, in accordance with SEC requirements. The Company may enter into a Rule 10(b)5-1 plan designed to facilitate the repurchase of all or a portion of the repurchase amount. The program does not require the Company to acquire a specific number of shares. Common stock repurchased can be reissued, and accordingly, the Company accounts for repurchased stock under the cost method of accounting.

During the ~~three~~nine months ended ~~August 1, 2014,~~July 31, 2015, the Company repurchased ~~45,979~~2,562,122 shares under this program at an average price paid per share of ~~$112.57,~~$101.29, for an aggregate purchase price of ~~$5.2~~$259.5 million.

The Company’s pension plans principally include a U.S. pension plan maintained by Esterline and a non-U.S. plan maintained by CMC Electronics, Inc. (CMC). The Company also sponsors a number of other non-U.S. defined benefit pension plans, primarily in Belgium, France and Germany. In fiscal 2014, the Company offered vested terminated participants of its U.S. pension plan a one-time opportunity to elect a lump-sum payment from the plan in lieu of a lifetime annuity. In the first fiscal quarter of 2015, the Company made a $16.6 million lump-sum payment to vested terminated pension plan participants from the plan, which resulted in an actuarial estimated settlement charge of $3.2 million. The charge was recorded in selling, general and administrative expenses. Components of periodic pension cost consisted of the following:

(In thousands)

Three Months Ended

Nine Months Ended

August 1,

July 26,

August 1,

July 26,

2014

2013

2014

2013

Service cost

$
2,621

$
2,832

$
8,244

$
9,103

Interest cost

4,737

4,414

14,314

13,208

Expected return on plan assets

(6,504
)

(5,836
)

(19,398
)

(17,142
)

Amortization of prior service costs

19

20

58

62

Amortization of actuarial loss

1,213

3,465

3,913

10,320

Net Periodic Cost

$
2,086

$
4,895

$
7,131

$
15,551

In Thousands	Three Months Ended						Nine Months Ended
	July 31,			August 1,			July 31,			August 1,
	2015			2014			2015			2014
Components of Net Periodic Cost
Service cost	$	3,028		$	2,621		$	8,728		$	8,244
Interest cost		4,334			4,737			12,863			14,314
Expected return on plan assets		(6,398	)		(6,504	)		(19,257	)		(19,398	)
Settlement		184			-			3,175			-
Amortization of prior service cost		271			19			305			58
Amortization of actuarial (gain) loss		1,462			1,213			3,860			3,913
Net periodic cost (benefit)	$	2,881		$	2,086		$	9,674		$	7,131

The Company’s principal post-retirement plans include non-U.S. plans, which are non-contributory healthcare and life insurance plans. The components of expense of these other retirement benefits consisted of the following:

The Company amortizes prior service cost and actuarial gains and losses from accumulated other comprehensive income to expense over the remaining service period.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A fair value hierarchy has been established that prioritizes the inputs to valuation

techniques used to measure fair value. An asset’s or liability’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The hierarchy of fair value measurements is described below:

Level 1 – Valuations are based on quoted prices that the Company has the ability to obtain in actively traded markets for identical assets and liabilities. Since valuations are based on quoted prices that are readily and regularly available in an active market or exchange traded market, a valuation of these instruments does not require a significant degree of judgment.

Level 2 – Valuations are based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market.

Level 3 – Valuations are based on model-based techniques for which some or all of the assumptions are obtained from indirect market information that is significant to the overall fair value measurement and which require a significant degree of management judgment.

The following table sets forth the Company’s financial assets and liabilities that were measured at fair value on a recurring basis by level within the fair value hierarchy at ~~August 1, 2014,~~July 31, 2015, and October ~~25, 2013.~~31, 2014.

(In thousands)	Level 2
In Thousands					Level 2
	August 1,		October 25,		July 31,		October 31,
	2014		2013		2015		2014
Assets:
Derivative contracts designated as hedging instruments	$	1,381	$	2,270	$	892	$	24
Derivative contracts not designated as hedging instruments		2,763		3,670		1,213		1,081
Embedded derivatives		1,222		706		4,454		2,351

Liabilities:
Derivative contracts designated as hedging instruments	$	8,129	$	4,541	$	28,277	$	14,592
Derivative contracts not designated as hedging instruments		941		122		1,837		4,188
Embedded derivatives		518		344		132		15

(In thousands)	Level 3
In Thousands					Level 3
	August 1,		October 25,		July 31,		October 31,
	2014		2013		2015		2014
Liabilities:
Contingent purchase obligation	$	5,000	$	4,000	$	3,750	$	5,000

The Company’s embedded derivatives are the result of entering into sales or purchase contracts that are denominated in a currency other than the Company’s functional currency or the supplier’s or customer’s functional currency. The fair value is determined by calculating the difference between quoted exchange rates at the time the contract was entered into and the period-end exchange rate. These contracts are categorized as Level 2 in the fair value hierarchy.

~~The~~From time to time, the Company’s derivative contracts consist of foreign currency exchange contracts and interest rate swap agreements. These derivative contracts are over the counter, and their fair value is determined using modeling techniques that include market inputs such as interest rates, yield curves, and currency exchange rates. These contracts are categorized as Level 2 in the fair value hierarchy.

The Company’s contingent purchase ~~obligations consist~~obligation consists of additional contingent consideration in connection with the acquisition of Sunbank Family of Companies, LLC (Sunbank) of $3.8 million as of July 31, 2015, and $5.0 million as of ~~August 1,~~October 31, 2014. The Company paid the first installment of $1.3 million in the third fiscal quarter of 2015. The contingent ~~considerations~~consideration will be payable to the sellers if certain performance objectives are met following the acquisition in accordance with the terms of the purchase agreement. The values recorded on the balance sheet were derived from the estimated probability that the performance objectives will be met. The contingent purchase obligation is categorized as Level 3 in the fair value hierarchy. ~~The Company paid $4.0 million of contingent consideration in the second fiscal quarter of 2014 for satisfaction of its obligation related to Eclipse Electronic Systems, Inc. (Eclipse).~~

The Company uses derivative financial instruments in the form of foreign currency forward exchange contracts and interest rate swap contracts for the purpose of minimizing exposure to changes in foreign currency exchange rates on business transactions and interest rates, respectively. The Company’s policy is to execute such instruments with banks the Company believes to be creditworthy and not to enter into derivative financial instruments for speculative purposes. These derivative financial instruments do not subject the

Company to undue risk, as gains and losses on these instruments generally offset gains and losses on the underlying assets, liabilities, or anticipated transactions that are being hedged.

All derivative financial instruments are recorded at fair value in the Consolidated Balance Sheet. For a derivative that has not been designated as an accounting hedge, the change in the fair value is recognized immediately through earnings. For a derivative that has been designated as an accounting hedge of an existing asset or liability (a fair value hedge), the change in the fair value of both the derivative and underlying asset or liability is recognized immediately through earnings. For a derivative designated as an accounting hedge of an anticipated transaction (a cash flow hedge), the change in the fair value is recorded on the Consolidated Balance Sheet in Accumulated Other Comprehensive Income (AOCI) to the extent the derivative is effective in mitigating the exposure related to the anticipated transaction. The change in the fair value related to the ineffective portion of the hedge, if any, is immediately recognized in earnings. The amount recorded within AOCI is reclassified into earnings in the same period during which the underlying hedged transaction affects earnings.

The fair ~~values~~value of derivative instruments are presented on a gross basis, as the Company does not have any derivative contracts which are subject to master netting arrangements. At ~~August 1,~~July 31, 2015, and October 31, 2014, the Company did not have any hedges with credit-risk-related contingent features or that required the posting of collateral. The cash flows from derivative contracts are recorded in operating activities in the Consolidated Statement of Cash Flows.

The Company transacts business in various foreign currencies, which subjects the Company’s cash flows and earnings to exposure related to changes in foreign currency exchange rates. These exposures arise primarily from purchases or sales of products and services from third parties. Foreign currency forward exchange contracts provide for the purchase or sale of foreign currencies at specified future dates at specified exchange rates, and are used to offset changes in the fair value of certain assets or liabilities or forecasted cash flows resulting from transactions denominated in foreign currencies. At ~~August 1, 2014,~~July 31, 2015, and October ~~25, 2013,~~31, 2014, the Company had outstanding foreign currency forward exchange contracts principally to sell U.S. dollars with notional amounts of ~~$375.7~~$380.3 million and ~~$369.0~~$396.2 million, respectively. These notional values consist primarily of contracts for the European euro, British pound sterling and Canadian dollar, and are stated in U.S. dollar equivalents at spot exchange rates at the respective dates.

The Company manages its exposure to interest rate risk by maintaining an appropriate mix of fixed and variable rate debt, which over time should moderate the costs of debt financing. When considered necessary, the Company may use financial instruments in the form of interest rate swaps to help meet this objective. In fiscal 2010, the Company entered into interest rate swap agreements for $175.0 million on the 2017 Notes. The swap agreements exchanged the fixed interest rate on the 2017 Notes of 6.625% for a variable interest rate. In the second fiscal quarter of 2013, the swap agreements were terminated and the Company redeemed the 2017 Notes with the proceeds from the $175.0 million U.S. Term Loan. The Company recorded a gain on the swap termination of $2.9 million in the second fiscal quarter of 2013.

In April 2015, the Company issued €330.0 million in 3.625% Senior Notes due April 2023 (2023 Notes) and requiring semi-annual interest payments in April and October each year until maturity. The Company designated the 2023 Notes a hedge of the investment of certain foreign business units. The foreign currency gain or loss that is effective as a hedge is reported as a component of other comprehensive income (loss) in shareholders’ equity. To the extent that this hedge is ineffective, the foreign currency gain or loss is recorded in earnings. There was no ineffectiveness since inception of the hedge. The Company also designated the accrued interest on the 2023 Notes as a net investment hedge.

In July 2011, the Company entered into a Euro Term Loan for €125.0 million under the secured credit facility. The Company designated the Euro Term Loan a hedge of the investment in a certain French business unit. The foreign currency gain or loss that is effective as a hedge is reported as a component of other comprehensive income (loss) in shareholders’ equity. To the extent that this hedge is ineffective, the foreign currency gain or loss is recorded in earnings. There was no ineffectiveness since inception of the hedge. On June 30, 2014, the Company paid off the remaining balance of the Euro Term Loan. As a result, the Company recorded a net loss of $0.5 million on extinguishment of ~~debt.~~debt in the third fiscal quarter of 2014.

Fair ~~values~~value of derivative instruments in the Consolidated Balance Sheet at ~~August 1, 2014,~~July 31, 2015, and October ~~25, 2013,~~31, 2014, consisted of:

(In thousands)		Fair Value
In Thousands							Fair Value
		August 1,		October 25,			July 31,		October 31,
	Classification	2014		2013		Classification	2015		2014
Foreign Currency Forward Exchange Contracts:
	Other current assets	$	2,969	$	4,547	Other current assets	$	1,739	$	1,052
	Other assets		1,175		1,393	Other assets		366		53
	Accrued liabilities		7,612		3,002	Accrued liabilities		22,683		15,490
	Other liabilities		1,458		1,661	Other liabilities		7,431		3,290

Embedded Derivative Instruments:
	Other current assets	$	141	$	59	Other current assets	$	497	$	296
	Other assets		1,081		647	Other assets		3,957		2,055
	Accrued liabilities		312		344	Accrued liabilities		132		15
	Other liabilities		206		-	Other liabilities		-		-

The effect of derivative instruments on the Consolidated Statement of Operations and Comprehensive Income (Loss) for the three and nine month periods ended July 31, 2015, and August 1, 2014, ~~and July 26, 2013,~~ consisted of:

We recognized the following gains (losses) on contracts designated as fair value hedges:

We recognized the following gains (losses) on contracts designated as cash flow hedges:

(In thousands)	Three Months Ended						Nine Months Ended
In Thousands													Three Months Ended						Nine Months Ended
Gain (Loss)	August 1,			July 26,			August 1,			July 26,			July 31,			August 1,			July 31,			August 1,
													2015			2014			2015			2014
	2014			2013			2014			2013
Foreign currency forward exchange contracts:
Recognized in AOCI (effective portion)	$	1,873		$	(544	)	$	(858	)	$	(1,975	)	$	(1,468	)	$	1,873		$	6,305		$	(858	)
Reclassified from AOCI into sales		(893	)		(551	)		(3,638	)		(1,187	)		(5,775	)		(893	)		(19,176	)		(3,638	)

We recognized the following gains (losses) on contracts designated as net investment hedges:

(In thousands)	Three Months Ended					Nine Months Ended
In Thousands											Three Months Ended				Nine Months Ended
Gain (Loss)	August 1,		July 26,			August 1,		July 26,			July 31,		August 1,		July 31,			August 1,
	2014		2013			2014		2013			2015		2014		2015			2014
Euro term loan:

Euro Term Loan:
Recognized in AOCI	$	162	$	(886	)	$	134	$	(1,310	)	$	-	$	162	$	-		$	134

2023 Notes:
Recognized in AOCI											$	7,095	$	-	$	(5,940	)	$	-

2023 Notes Interest:
Recognized in AOCI											$	34	$	-	$	34		$	-

During the first nine months of fiscal ~~2014~~2015 and ~~2013,~~2014, the Company recorded ~~losses~~a gain of ~~$0.8~~$1.0 million and ~~$1.5~~a loss of $0.8 million, respectively, on foreign currency forward exchange contracts that have not been designated as an accounting ~~hedge.~~hedges. These foreign currency exchange ~~losses~~gains (losses) are included in selling, general and administrative expense.

There was no significant impact to the Company’s earnings related to the ineffective portion of any hedging instruments during the first nine months of fiscal ~~2014~~2015 and ~~2013.~~2014. In addition, there was no significant impact to the Company’s earnings when a hedged firm commitment no longer qualified as a fair value hedge or when a hedged forecasted transaction no longer qualified as a cash flow hedge during the first nine months of fiscal ~~2014~~2015 and ~~2013.~~2014.

Amounts included in AOCI are reclassified into earnings when the hedged transaction settles. The Company expects to reclassify approximately ~~$5.7~~$20.8 million of net loss into earnings over the next 12 months. The $20.8 million loss will reduce the Company’s U.S.-dollar-denominated sales covered by qualified forward contracts to the forward rate when the Company entered into the forward contracts. The maximum duration of the Company’s foreign currency cash flow hedge contracts at ~~August 1, 2014,~~July 31, 2015, is 24 months.

The income tax ~~rates were 20.6% and 11.4% for~~rate was 17.4% in the ~~first nine months~~third fiscal quarter of ~~fiscal 2014 and 2013, respectively.~~2015 compared with 23.7% in the prior-year period. In the ~~first nine months~~third fiscal quarter of ~~2014,~~2015, the Company recognized ~~approximately $1.4~~$0.9 million of discrete tax benefits principally related to the following items. The first item was approximately ~~$0.9~~$1.2 million of tax benefits due to the release of reserves upon the expiration of a statute of limitations. The second item was approximately $0.3 million of discrete tax expense principally related to reconciling the prior year’s income tax return to the income tax provision. In the third fiscal quarter of 2014, the Company recognized $0.2 million of discrete tax expense. The income tax rate differed from the statutory rate in the third fiscal quarters of 2015 and 2014, as both years benefited from various tax credits and certain foreign interest expense deductions.

The income tax rates were 19.9% and 21.5% for the first nine months of fiscal 2015 and 2014, respectively. In the first nine months of fiscal 2015, the Company recognized $0.1 million of discrete tax benefits principally related to the following items. The first item was approximately $1.5 million of discrete tax benefits due to the retroactive extension of the U.S. federal research and experimentation credits. The second item was approximately $1.2 million of tax benefits due to the release of reserves upon the expiration of a statute of limitations. The third item was approximately $2.6 million of discrete tax expense principally related to reconciling the prior year’s income tax return to the income tax provision. In the first nine months of fiscal 2014, the Company recognized approximately $0.9 million of discrete tax benefits principally related to the following items. The first item was approximately $0.7 million of tax benefits upon the release of reserves due to the expiration of ~~applicable statutes~~a statute of limitations. The second item was a $0.5 million reduction of net deferred income tax liabilities as a result of the enactment of tax laws reducing the U.K. statutory income tax rate. ~~In the first nine months of fiscal 2013, the Company recognized $12.4~~The third item was approximately $0.3 million of discrete tax ~~benefits~~expense principally related to reconciling the ~~following items. The first item was approximately $1.5 million of~~prior year’s income tax ~~benefits due~~return to the retroactive extension of the U.S. federal research and experimentation credits. The second item was approximately $2.3 million of tax benefits related to the settlement of U.S. and foreign tax examinations. The third item was a $4.3 million tax benefit related to the release of tax reserves due to the expiration of applicable statutes of limitations. The fourth item was a $3.8 million reduction of net deferred income tax ~~liabilities as a result of the enactment of tax laws reducing the U.K. statutory income tax rate.~~provision. The income tax rate differed from the statutory rate in the first nine months of fiscal ~~2014~~2015 and ~~2013,~~2014, as both years benefited from various tax credits and certain foreign interest expense deductions.

It is reasonably possible that within the next twelve months approximately ~~$1.6~~$0.9 million of tax benefits that are currently unrecognized could be recognized as a result of settlement of examinations and/or the expiration of applicable statutes of limitations.

In March 2011, the Company entered into a secured credit facility for $460 million made available through a group of banks. The credit facility is secured by substantially all of the Company’s assets and interest is based on standard inter-bank offering rates. ~~The~~On April 9, 2015, the Company amended the secured credit facility ~~expires July 20, 2016.~~to extend the expiration to April 9, 2020, increase the revolving credit facility to $500 million, and provide for a delayed-draw term loan facility of $250 million. Borrowing under the delayed-draw term loan facility, if utilized, may be used only for working capital and repayment or refinancing of our existing indebtedness and to pay the fees and expenses in connection therewith. The ~~spread~~interest rate on the credit facility ranges from LIBOR plus ~~1.5%~~1.25% to LIBOR plus ~~2.25%~~2.00% depending on the leverage ratios at the time the funds are drawn. At ~~August 1, 2014,~~July 31, 2015, the Company had ~~$115.0~~$200.0 million outstanding under the secured credit facility at an interest rate of LIBOR plus 1.50%, which was ~~1.66%~~1.69% at ~~August 1, 2014.~~

In July 2011, the Company amended the secured credit facility to provide for a €125.0 million term loan (Euro Term Loan). On June 30, 2014, the Company redeemed the €125.0 million Euro Term Loan. In connection with the redemption, the Company wrote off $0.5 million in unamortized debt issuance costs as a loss on extinguishment of debt in the third fiscal quarter of 2014.31, 2015.

In April 2013, the Company amended the secured credit facility to provide for a $175.0 million term loan (U.S. Term Loan). The interest rate on the U.S. Term Loan ranges from LIBOR plus 1.5% to LIBOR plus 2.25% depending on the leverage ratios at the time the funds are drawn. ~~At August 1, 2014,~~On April 8, 2015, the Company ~~had $164.1~~paid off the $175 million ~~outstanding under the~~ U.S. Term Loan at an interest rate of LIBOR plus 1.50%, which was 1.66% at August 1, 2014. The loan amortizes at 1.25% of the original principal balance quarterly through March 31, 2016, with the remaining balance due in July 20, 2016.

In June 2014, the Company amended the secured credit facility to increase the U.K. borrower sublimit and to permit additional borrowers under the revolving credit facility in order to give the Company greater flexibility on foreign borrowing.

~~In April 2013, the Company redeemed the $175.0 million 6.625% Senior Notes due March 1, 2017 (2017 Notes).~~Loan. In connection with the redemption, the Company wrote off ~~$1.3~~$0.3 million in unamortized debt issuance costs as a charge against interest expense. In addition, the Company incurred a $3.9 million redemption premium and received proceeds of $2.9 million from the termination of its $175.0 million interest rate swap agreements. As a result, the redemption of the 2017 Notes resulted in a net loss ~~of $0.9 million~~ on extinguishment of debt in the second fiscal quarter of ~~2013.~~2015.

In August 2010, the Company issued $250.0 million in 7% Senior Notes due August 1, 2020 (2020 Notes), and requiring semi-annual interest payments in February and August of each year until maturity. The net proceeds from the sale of the notes, after deducting $4.4 million of debt issuance costs, were $245.6 million. The 2020 Notes are general unsecured senior obligations of the Company. The 2020 Notes are guaranteed, jointly and severally on a senior basis, by all the existing and future domestic subsidiaries of the

Company unless designated as an “unrestricted subsidiary,” and those foreign subsidiaries that executed related subsidiary guarantees under the indenture covering the 2020 Notes. The 2020 Notes are subject to redemption at the option of the Company at any time prior to August 1, 2015, at a price equal to 100% of the principal amount, plus any accrued interest to the date of redemption and a make-whole provision. The 2020 Notes are also subject to redemption at the option of the Company, in whole or in part, on or after August 1, 2015, at redemption prices starting at 103.500% of the principal amount plus accrued interest during the period beginning August 1, 2015, and declining annually to 100% of principal and accrued interest on or after August 1, 2018.

Subsequent to period end, on August 3, 2015, the Company borrowed $250 million under the delayed-draw term loan provided for under the amended credit facility. The delayed-draw term loan carries the same interest rate as the amended credit facility. On August 4, 2015, the proceeds from the delayed-draw term loan were used to redeem all of the 7% Senior Notes due 2020. As part of the redemption, the Company incurred an $8.75 million redemption premium and wrote off $2.4 million in unamortized debt issuance costs which will be expensed in the fourth fiscal quarter of 2015.

In April 2015, the Company issued €330.0 million in 3.625% 2023 Notes requiring semi-annual interest payments in April and October of each year until maturity. The net proceeds from the sale of the notes, after deducting $5.7 million of debt issuance costs, were $350.8 million. The 2023 Notes are general unsecured senior obligations of the Company. The 2023 Notes are unconditionally guaranteed on a senior basis by the Company and certain subsidiaries of the Company that are guarantors under the Company’s existing secured credit facility. The 2023 Notes are subject to redemption at the option of the Company at any time prior to April 15, 2018, at a price equal to 100% of the principal amount, plus any accrued interest to the date of redemption and a make-whole provision. The Company may also redeem up to 35% of the 2023 Notes before April 15, 2018, with the net cash proceeds from equity offerings. The 2023 Notes are also subject to redemption at the option of the Company, in whole or in part, on or after April 15, 2018, at redemption prices starting at 102.719% of the principal amount plus accrued interest during the period beginning April 15, 2018, and declining annually to 100% of principal and accrued interest on or after April 15, 2021.

Based on quoted market prices, the approximate fair value of the Company’s ~~$250.0 million 7.0% Senior~~2020 Notes ~~due August 1, 2020 (2020 Notes)~~ was approximately ~~$268.9~~$255.3 million and ~~$272.5~~$266.9 million as of ~~August 1, 2014,~~July 31, 2015, and October ~~25, 2013,~~31, 2014, respectively. Based on quoted market prices, the approximate fair value of the Company’s 2023 Notes was approximately $352.5 million as of July 31, 2015. The carrying ~~amounts~~amount of the secured credit facility ~~and U.S. Term Loan approximate~~approximates fair value. Estimates of fair value for the 2020 Notes and 2023 Notes are based on quoted market prices, and are considered Level 2 inputs as defined in the fair value hierarchy described in Note 5.

Government refundable advances consist of payments received from the Canadian government to assist in research and development related to commercial aviation. The repayment of this advance is based on year-over-year commercial aviation revenue growth at CMC beginning in 2014. Imputed interest on the advance was ~~4.55%~~4.29% at ~~August 1, 2014.~~July 31, 2015. The ~~discounted value of~~ debt recognized was ~~$52.9~~$43.2 million and ~~$56.9~~$51.9 million as of ~~August 1, 2014,~~July 31, 2015, and October ~~25, 2013,~~31, 2014, respectively.

~~During the third fiscal quarter~~As of ~~2013,~~July 31, 2015, and October 31, 2014, the Company ~~recorded~~had a liability of $1.5 million ~~liability~~in both periods, related to environmental remediation at a previously sold business for which the Company provided indemnification. ~~A loss~~

In the first fiscal quarter of ~~$1.0~~2015, the Company recognized a $15.7 million ~~net~~gain and a $2.4 million reduction in interest expense upon the lapse of a statutory period related to a liability for a non-income tax ~~is reflected in discontinued operations on the Consolidated Statement~~position of ~~Operations and Comprehensive Income (Loss).~~an acquired company.

On March 5, 2014, the Company entered into a Consent Agreement with the U.S. Department of State’s Directorate of Defense Trade Controls Office of Defense Trade Controls Compliance (DTCC) to resolve alleged International Traffic in Arms Regulations (ITAR) civil violations. The Consent Agreement ~~settles~~settled the pending ITAR compliance matter with the DTCC previously reported by the Company that resulted from voluntary reports the Company filed with DTCC that disclosed possible technical and administrative violations of the ITAR. The Consent Agreement has a three-year term and provides for: (i) a payment of $20 million, $10 million of which is suspended and eligible for offset credit based on verified expenditures for past and future remedial compliance measures; (ii) the appointment of an external Special Compliance Official to oversee compliance with the Consent Agreement and the ITAR; (iii) two external audits of the Company’s ITAR compliance program; and (iv) continued implementation of ongoing remedial compliance measures and additional remedial compliance measures related to automated systems and ITAR compliance policies, procedures, and training.

The settlement amount in the Consent Agreement iswas consistent with the amount proposed by DTCC in August 2013, for which the Company estimated and recorded a $10 million charge in the third fiscal quarter ended July 26, 2013. The $10 million portion of the settlement that is not subject to suspension will be paid in installments, with $4 million paid in March 2014, $2 million paid in February 2015, and $2 million to be paid in each of March ~~2015,~~ 2016 and 2017. The Company expects some part of recent investments made in ~~our~~its ITAR compliance

program will be eligible for credit against the suspended portion of the settlement amount, which include: additional staffing, ongoing implementation of a new software system, employee training, and establishment of a regular

compliance audit program and corrective action process. The Company expects recent and future investments in remedial compliance measures will be sufficient to cover the $10 million suspended payment.

As of ~~August 1, 2014,~~July 31, 2015, the Company had three share-based compensation plans, which are described below. The compensation cost that has been charged against income for those plans was ~~$9.8~~$8.6 million and ~~$7.7~~$9.8 million for the first nine months of fiscal ~~2014~~2015 and ~~2013,~~2014, respectively. During the first nine months of fiscal ~~2014~~2015 and ~~2013,~~2014, the Company issued ~~600,540~~241,632 and ~~502,946~~600,540 shares, respectively, under its share-based compensation plans.

The ESPP is a “safe-harbor” designed plan whereby shares are purchased by participants at a discount of 5% of the market value on the purchase date and, therefore, compensation cost is not recorded.

The Company offers shares under its employee sharesave scheme for U.K. employees. This plan allows participants the option to purchase shares at a 5% discount ~~of 5%~~ of the market price of the stock as of the beginning of the offering period. The term of these options is three years. The sharesave scheme is not a “safe-harbor” design, and therefore, compensation cost is recognized on this plan. Under the sharesave scheme, option exercise prices are equal to the fair market value of the Company’s common stock on the date of grant. The Company granted ~~29,242~~25,984 and ~~16,722~~29,242 options in the ~~first~~ nine month periods ended July 31, 2015, and August 1, 2014, ~~and July 26, 2013,~~ respectively. The weighted-average grant date fair value of options granted during the nine month periods ended July 31, 2015, and August 1, 2014, was $24.31 and ~~July 26, 2013, was~~ $27.03 ~~and $20.24~~ per share, respectively.

The fair value of the awards under the employee sharesave scheme was estimated using a Black-Scholes pricing model which uses the assumptions noted in the following table. The risk-free rate for the contractual life of the option is based on the U.S. Treasury zero coupon issues in effect at the time of grant.

			Nine Months Ended
	Nine Months Ended		July 31,			August 1,
	August 1,	July 26,	2015			2014
	2014	2013
Volatility	33.69%	36.97%		25.80	%		33.69	%
Risk-free interest rate	0.73%	0.40%		0.93	%		0.73	%
Expected life (years)	3	3	3			3
Dividends	0	0	0			0

Under the equity incentive plan, option exercise prices are equal to the fair market value of the Company’s common stock on the date of grant. The Company granted ~~193,200~~192,700 and ~~244,700~~193,200 options to purchase shares in the nine month periods ended July 31, 2015, and August 1, 2014, ~~and July 26, 2013,~~ respectively. The weighted-average grant date fair value of options granted during the nine month periods ended July 31, 2015, and August 1, 2014, was $48.48 and ~~July 26, 2013, was~~ $45.23 ~~and $29.24~~ per share, respectively.

The fair value of each option granted by the Company was estimated using a Black-Scholes pricing model, which uses the assumptions noted in the following table. The Company uses historical data to estimate volatility of the Company’s common stock and option exercise and employee termination assumptions. The risk-free rate for the contractual life of the option is based on the U.S. Treasury zero coupon issues in effect at the time of the grant.

			Nine Months Ended
	Nine Months Ended		July 31,	August 1,
	August 1,	July 26,	2015	2014
	2014	2013
Volatility	41.87 - 43.17%	41.89 - 44.25%	40.73 - 41.89%	41.87 - 43.17%
Risk-free interest rate	1.73 - 2.99%	0.79 - 1.88%	1.43 - 2.00%	1.73 - 2.99%
Expected life (years)	5 - 9	4.5 - 9.5	5 - 9	5 - 9
Dividends	0	0	0	0

The Company granted ~~77,575~~22,000 and ~~32,200~~77,575 restricted stock units ~~during~~in the nine month periods ended July 31, 2015, and August 1, 2014, ~~and July 26, 2013,~~ respectively. The weighted-average grant date fair value of restricted stock units granted during the nine month periods ended July 31, 2015, and August 1, 2014, was $112.53 and ~~July 26, 2013, was~~ $84.50 ~~and $62.52~~ per share, respectively. The fair value of each restricted stock unit granted by the Company is equal to the fair market value of the Company’s common stock on the date of grant.

On January 31, 2015, the Company acquired the defense, aerospace and training display (DAT) business of Belgium-based Barco N.V. (Barco) for €150 million, or approximately $171 million, in cash before a working capital adjustment of approximately $15 million which decreased the purchase price and was received subsequent to the third fiscal quarter of 2015. The Company incurred a $2.9 million foreign currency exchange loss in the funding of the acquisition in the first fiscal quarter of 2015. Acquisition related costs of $3.4 million have been recognized as selling, general and administrative expense. The Company financed the acquisition primarily using international cash reserves, with the balance funded by borrowings under its existing credit facility. The display business develops and manufactures visualization solutions for a variety of demanding defense and commercial aerospace applications. The display business is included in our Avionics & Controls segment.

The following summarizes the allocation of the estimated fair value of the assets acquired and liabilities assumed at the date of acquisition. The fair value adjustment for inventory was $7.1 million, which will be recognized as cost of goods sold over 13 months, the estimated inventory turnover. The fair value of acquired programs represented the value of visualization solutions sold under long-term supply agreements with aerospace companies, military contractors, and OEM manufacturers using similar technology. The valuation of the program included the values of program-specific technology, the backlog of contracts, and the relationship with customers which lead to potential future contracts. The valuation of the programs was based upon the discounted cash flow at a market-based discount rate. The purchase price includes the value of existing technologies, the introduction of new technologies, and the addition of new customers. These factors resulted in recording goodwill of $48.0 million. The amount allocated to goodwill is not deductible for income tax purposes.

On December 20, 2013, the Company acquired Sunbank for $51.7 million. The purchase price included $5 million in additional contingent consideration based upon achievement of certain sales levels over a two-year ~~period.~~period, of which the Company paid the first installment of $1.3 million in the third fiscal quarter of 2015. The remaining $3.7 million in additional contingent consideration is expected to be paid. Sunbank is a manufacturer of electrical cable accessories, connectors and flexible conduit systems. Sunbank is included in the Sensors & Systems segment.

On February 4, 2013, the Company acquired the Gamesman Group (Gamesman) for $40.8 million. Gamesman is a global supplier of input devices principally serving the gaming industry. Gamesman is included in the Avionics & Controls segment.

~~The Company’s accumulated other comprehensive loss is comprised of the following:~~

On December 5, 2013, the Company announced the acceleration of its plans to consolidate certain facilities and create cost efficiencies through shared services in sales, general and administrative and support functions. These integration activities are expected to result in charges and expenses for a total of ~~approximately $40 million. The Company expects to incur costs of $20 million to $25~~$35 million in fiscal 2014 ~~to support these efforts, with the balance to be incurred~~and fiscal 2015. Total restructuring expenses were $20.4 million in fiscal ~~2015.~~2014. The costs are ~~mainly~~ for exit and relocation of facilities, losses on the write off of certain property, plant and equipment, and severance. In the first nine months of fiscal 2015, restructuring expense totaled $10.1 million, as more fully described in the following table:

In the first nine months of fiscal 2014, restructuring expense totaled $14.3 million, as more fully described in the following ~~table.~~table:

(In thousands)			Write Off of
In Thousands												Write Off of
	Exit &		of Property,							Exit &		Property,
	Relocation		Plant &							Relocation		Plant &
	of Facilities		Equipment			Severance		Total		of Facilities		Equipment		Severance		Total

Cost of sales	$	4,029	$	9		$	-	$	4,038	$	4,029	$	9	$	-	$	4,038
Restructuring charges		2,866		2,542	��		4,871		10,279		2,866		2,542		4,871		10,279
Total	$	6,895	$	2,551		$	4,871	$	14,317	$	6,895	$	2,551	$	4,871	$	14,317

The Company has recorded an accrued liability ~~for $6.4~~of $4.2 million and $5.9 million for these activities as of ~~August 1, 2014.~~July 31, 2015, and October 31, 2014, respectively.

(In thousands)	Accrued
In Thousands				Accrued
				Liabilities
	Liabilities
Beginning Balance as of October 25, 2013	$	-		$	-
Amounts accrued and incurred		14,317			20,388
Amounts paid		(5,313	)		(11,688	)
Write-off		(2,542	)		(2,585	)
Currency translation adjustment		(37	)		(200	)
Ending Balance as of August 1, 2014	$	6,425
Balance as of October 31, 2014				$	5,915

Amounts accrued and incurred					10,126
Amounts paid					(10,968	)
Write-off					(651	)
Currency translation adjustment					(227	)
Balance as of July 31, 2015				$	4,195

On September 3, 2014, the Company approved a plan to sell certain non-core business units including Eclipse, a manufacturer of embedded communication intercept receivers for signal intelligence ~~applications,~~applications; Wallop Defence Systems, Ltd. (Wallop), a manufacturer of flare countermeasure ~~devices,~~devices; Pacific Aerospace and Electronics Inc. (PA&E), a manufacturer of hermetically sealed electrical ~~connectors,~~connectors; and ~~an immaterial~~a small distribution business. These businesses were not separate reporting units as defined under U.S. GAAP and no indicator of impairment existed at August 1, 2014, requiring an impairment test of their corresponding reporting units’ goodwill or these businesses’ long-lived assets. ~~Due to~~Based upon the ~~Company’s plan to sell these businesses, during~~estimated fair values, the Company incurred an estimated after-tax loss of $49.5 million in the fourth fiscal quarter of 2014 on assets held for sale in discontinued operations. Principal assumptions used in measuring the ~~assets will be valued at fair value and goodwill~~estimated after-tax loss included estimated selling price of the ~~reporting unit will be allocated to each~~discontinued business, ~~based upon~~discount rates, industry growth rates, and pricing of comparable transactions in the ~~relative fair value of the business units and the reporting unit.~~market. Eclipse and the distribution business are included in the Avionics & Controls segment, Wallop is included in the Advanced Materials segment, and PA&E is included in the Sensors & Systems segment. ~~Beginning in~~

On June 5, 2015, the ~~fourth~~Company completed the sale of Eclipse for approximately $10 million. The Company retained ownership of the land, building and building improvements, which are being held for sale. On July 20, 2015, the Company completed the sale of PA&E for approximately $22 million. The selling price for both businesses is subject to customary working capital adjustments.

During the third fiscal quarter of ~~2014, these businesses will be reported as~~2015, the Company incurred a loss of $1.7 million on discontinued operations. ~~Based upon~~During the first nine months of fiscal 2015, the Company incurred a ~~range~~loss on discontinued operations of ~~projected fair values, management expects to incur an estimated after-tax~~$20.3 million, including a $16.4 million loss ~~between $55~~on assets held for sale. For the first nine months of fiscal 2015, a $11.9 million ~~and $75 million in the fourth fiscal quarter of 2014~~loss on ~~the~~ assets ~~to be~~ held for sale at Avionics & Controls was principally due the reduction of Eclipse’s estimated selling price based upon lower expectations of earnings for the business and continuing negotiations with the buyer. The $5.1 million write-off in Advanced Materials was due to the effects of valuing Wallop’s balance sheet at the current exchange rate incurred in the first nine months of fiscal 2015.

During the first nine months of fiscal 2015, the Company recorded a $2.0 million increase in a liability related to environmental remediation at a previously sold business for which the Company provided indemnification. A loss of $1.3 million, net of tax, is reflected in discontinued operations.

The operating results of the discontinued operations for the three month period ended July 31, 2015, consisted of the following:

The operating results of the discontinued operations for the nine month period ended July 31, 2015, consisted of the following:

The operating results of the discontinued operations for the three month period ended August 1, 2014, consisted of the following:

The operating results of the discontinued operations for the nine month period ended August 1, 2014, consisted of the following:

Assets and Liabilities Held for Sale within the Consolidated Balance Sheet at July 31, 2015, are comprised of the following:

In Thousands	Avionics &		Sensors &		Advanced
	Controls		Systems		Materials		Total

Accounts receivable, net	$	1,589	$	-	$	4,949	$	6,538
Inventories		2,451		-		5,111		7,562
Prepaid expenses		21		-		277		298
Deferred income tax benefits		-		-		-		-
Income tax refundable		-		-		-		-
Current Assets of Businesses Held for Sale	$	4,061	$	-	$	10,337	$	14,398

Net property, plant and equipment	$	5,324	$	-	$	16,817	$	22,141
Intangibles, net		950		-		6,905		7,855
Deferred income tax benefits		-		-		-		-
Other assets		-		-		1,562		1,562
Non-Current Assets of Businesses Held for Sale	$	6,274	$	-	$	25,284	$	31,558

Accounts payable	$	1,533	$	-	$	5,389	$	6,922
Accrued liabilities		506		-		1,457		1,963
Current Liabilities of Businesses Held for Sale	$	2,039	$	-	$	6,846	$	8,885

Deferred income tax liabilities	$	-	$	-	$	1,795	$	1,795
Other liabilities		64		-		-		64
Non-Current Liabilities of Businesses Held for Sale	$	64	$	-	$	1,795	$	1,859

Net Assets of Businesses Held for Sale	$	8,232	$	-	$	26,980	$	35,212

Assets and Liabilities Held for Sale within the Consolidated Balance Sheet at October 31, 2014, were comprised of the following:

In Thousands	Avionics &		Sensors &			Advanced
	Controls		Systems			Materials		Total

Accounts receivable, net	$	5,154	$	3,752		$	2,106	$	11,012
Inventories		12,646		7,972			5,258		25,876
Prepaid expenses		408		86			335		829
Deferred income tax benefits		671		680			-		1,351
Income tax refundable		-		-			2,378		2,378
Current Assets of Businesses Held for Sale	$	18,879	$	12,490		$	10,077	$	41,446

Net property, plant and equipment	$	4,949	$	4,105		$	19,839	$	28,893
Intangibles, net		22,228		10,659			8,327		41,214
Deferred income tax benefits		-		(30	)		-		(30	)
Other assets		-		-			1,600		1,600
Non-Current Assets of Businesses Held for Sale	$	27,177	$	14,734		$	29,766	$	71,677

Accounts payable	$	2,194	$	873		$	6,326	$	9,393
Accrued liabilities		1,765		1,008			2,025		4,798
Current Liabilities of Businesses Held for Sale	$	3,959	$	1,881		$	8,351	$	14,191

Deferred income tax liabilities	$	11,084	$	6,243		$	1,537	$	18,864
Other liabilities		-		-			12		12
Non-Current Liabilities of Businesses Held for Sale	$	11,084	$	6,243		$	1,549	$	18,876

Net Assets of Businesses Held for Sale	$	31,013	$	19,100		$	29,943	$	80,056

Business segment information for continuing operations includes the segments of Avionics & Controls, Sensors & Systems and Advanced Materials.

(In thousands)		Three Months Ended						Nine Months Ended
In Thousands															Three Months Ended						Nine Months Ended
		August 1,			July 26,			August 1,			July 26,				July 31,			August 1,			July 31,			August 1,
		2014			2013			2014			2013				2015			2014			2015			2014
Sales
Avionics & Controls		$	200,109		$	179,572		$	596,149		$	546,272			$	207,467		$	192,860		$	594,534		$	571,366
Sensors & Systems			198,106			175,864			595,929			524,638				175,530			192,246			515,611			579,131
Advanced Materials			132,909			122,632			373,600			364,682				113,220			121,203			332,496			352,613
Total Sales		$	531,124		$	478,068		$	1,565,678		$	1,435,592
															$	496,217		$	506,309		$	1,442,641		$	1,503,110

Earnings from Continuing Operations Before Income Taxes	Earnings from Continuing Operations Before Income Taxes													Earnings from Continuing Operations Before Income Taxes
Avionics & Controls ⁽¹⁾		$	29,055		$	20,597		$	75,386		$	60,651
Avionics & Controls															$	23,473		$	30,902		$	52,024		$	81,952
Sensors & Systems			18,196			21,584			61,533			63,792				23,356			18,055			55,491			61,811
Advanced Materials			27,532			28,135			70,903			74,402				24,396			27,724			65,908			75,911
Segment Earnings			74,783			70,316			207,822			198,845				71,225			76,681			173,423			219,674

Corporate expense			(16,142	)		(20,793	)		(48,398	)		(53,224	)			(24,045	)		(16,142	)		(65,067	)		(48,398	)
Other income																-			-			12,744			-
Interest income			146			132			403			381				144			145			447			400
Interest expense			(7,870	)		(9,050	)		(24,939	)		(30,976	)			(10,618	)		(7,865	)		(25,023	)		(24,924	)
Loss on extinguishment of debt			(533	)		-			(533	)		(946	)			-			(533	)		(329	)		(533	)
		$	50,384		$	40,605		$	134,355		$	114,080			$	36,706		$	52,286		$	96,195		$	146,219

The following schedules set forth condensed consolidating financial information as required by Rule 3-10 of Securities and Exchange Commission Regulation S-X as of ~~August 1, 2014,~~July 31, 2015, and October ~~25, 2013,~~31, 2014, and for the applicable periods ended July 31, 2015, and August 1, 2014, ~~and July 26, 2013,~~ for (a) Esterline Technologies Corporation (the Parent); (b) TA Mfg. Limited, the issuer of the 2023 Notes; (c) on a combined basis, the current subsidiary guarantors (Guarantor Subsidiaries) of the secured credit facility, the 2020 Notes and ~~2020 Notes;~~the 2023 Notes for the periods after April 2015; and ~~(c)~~(d) on a combined basis, the subsidiaries that are not guarantors (Non-Guarantor Subsidiaries) of the secured credit facility, ~~and~~the 2020 Notes ~~(Non-Guarantor Subsidiaries).~~and the 2023 Notes for the periods after April 2015. The Guarantor Subsidiaries are direct and indirect wholly-owned subsidiaries of Esterline Technologies Corporation and have fully and unconditionally, jointly and severally, guaranteed the secured credit facility, the 2020 Notes and the ~~2020~~2023 Notes.

(In thousands)							Non-
In Thousands																							Non-
				Guarantor			Guarantor										TA Mfg.			Guarantor			Guarantor
	Parent			Subsidiaries			Subsidiaries		Eliminations			Total		Parent			Ltd.			Subsidiaries			Subsidiaries		Eliminations			Total
ASSETS

Current Assets
Cash and cash equivalents	$	4,039		$	5,617		$	200,800	$	-		$	210,456	$	16,454		$	995		$	1,376		$	168,857	$	-		$	187,682
Cash in escrow		-			-			-		-			-
Accounts receivable, net		(212	)		145,086			216,953		-			361,827		33			-			136,624			237,042		-			373,699
Inventories		-			216,485			277,327		-			493,812		-			-			193,345			276,355		-			469,700
Income tax refundable		-			-			7,681		-			7,681		-			-			-			17,515		-			17,515
Deferred income tax benefits		29,042			169			21,505		-			50,716		29,330			-			(14,519	)		22,134		-			36,945
Prepaid expenses		169			7,968			16,679		-			24,816		93			-			7,648			13,666		-			21,407
Other current assets		84			116			4,086		-			4,286		74			-			111			17,011		-			17,196
Current assets of businesses held for sale															-			-			-			14,398		-			14,398
Total Current Assets		33,122			375,441			745,031		-			1,153,594		45,984			995			324,585			766,978		-			1,138,542

Property, Plant & Equipment, Net		1,470			169,712			192,023		-			363,205		1,992			-			158,658			145,741		-			306,391
Goodwill		-			362,192			770,795		-			1,132,987		-			-			372,021			668,422		-			1,040,443
Intangibles, net		-			155,050			405,843		-			560,893		-			-			109,929			350,039		-			459,968
Debt issuance costs, net		4,453			-			184		-			4,637		5,380			5,655			-			-		-			11,035
Deferred income tax benefits		14,799			(1	)		53,618		-			68,416		18,659			-			14,670			42,283		-			75,612
Other assets		515			16,020			8,191		-			24,726		281			-			10,386			11,436		-			22,103
Non-current assets of businesses held for sale															-			-			5,262			26,296		-			31,558
Amounts Due From (To) Subsidiaries		-			651,862			-		(651,862	)		-		-			353,831			817,896			-		(1,171,727	)		-
Investment in Subsidiaries		2,772,194			1,415,794			115,373		(4,303,361	)		-		3,098,201			653,386			1,009,069			14,644		(4,775,300	)		-
Total Assets	$	2,826,553		$	3,146,070		$	2,291,058	$	(4,955,223	)	$	3,308,458	$	3,170,497		$	1,013,867		$	2,822,476		$	2,025,839	$	(5,947,027	)	$	3,085,652

LIABILITIES AND SHAREHOLDERS' EQUITY														LIABILITIES AND SHAREHOLDERS' EQUITY

LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts payable	$	1,831		$	38,140		$	83,405	$	-		$	123,376	$	2,846		$	-		$	36,884		$	71,685	$	-		$	111,415
Accrued liabilities		10,770			85,711			142,487		-			238,968		19,441			4,124			80,197			163,624		-			267,386
Current maturities of long-term debt		8,750			371			3,701		-			12,822		-			-			898			116		-			1,014
Deferred income tax liabilities		444			19			2,742		-			3,205		15,159			-			(14,669	)		2,503		-			2,993
Federal and foreign income taxes		(2,054	)		(8,882	)		13,245		-			2,309		(9,624	)		(51	)		(5,165	)		18,693		-			3,853
Current liabilities of businesses held for sale															-			-			-			8,885		-			8,885
Total Current Liabilities		19,741			115,359			245,580		-			380,680		27,822			4,073			98,145			265,506		-			395,546

Credit Facilities		115,000			-			-		-			115,000		170,000			-			-			30,000		-			200,000
Long-Term Debt, Net		405,313			55,273			52,533		-			513,119		250,000			362,472			56,976			43,361		-			712,809
Deferred Income Tax Liabilities		54,211			(7	)		124,592		-			178,796		24,867			-			14,658			93,974		-			133,499
Pension and Post-Retirement Obligations		17,388			713			44,658		-			62,759		18,591			-			754			37,413		-			56,758
Other Liabilities		16,313			3,944			27,056		-			47,313		14,134			-			194			16,184		-			30,512
Non-current liabilities of businesses held for sale															-			-			-			1,859		-			1,859
Amounts Due To (From) Subsidiaries		187,796			-			454,020		(641,816	)		-		1,110,414			-			-			398,562		(1,508,976	)		-
Shareholders' Equity		2,010,791			2,970,788			1,342,619		(4,313,407	)		2,010,791		1,554,669			647,322			2,651,749			1,138,980		(4,438,051	)		1,554,669
Total Liabilities and Shareholders' Equity	$	2,826,553		$	3,146,070		$	2,291,058	$	(4,955,223	)	$	3,308,458	$	3,170,497		$	1,013,867		$	2,822,476		$	2,025,839	$	(5,947,027	)	$	3,085,652

Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the three month period ended July 31, 2015.

In Thousands										Non-
				TA Mfg.			Guarantor			Guarantor
	Parent			Ltd.			Subsidiaries			Subsidiaries			Eliminations			Total

Net sales	$	-		$	-		$	225,105		$	272,137		$	(1,025	)	$	496,217
Cost of sales		-			-			147,206			180,240			(1,025	)		326,421
		-			-			77,899			91,897			-			169,796
Expenses
Selling, general and administrative		-			55			38,794			53,119			-			91,968
Research, development & engineering		-			-			10,158			19,087			-			29,245
Restructuring charges		-			-			1,228			175			-			1,403
Other (income) expense		-			-			-			-			-			-
Total Expenses		-			55			50,180			72,381			-			122,616

Operating Earnings from Continuing Operations		-			(55	)		27,719			19,516			-			47,180
Interest Income		(3,928	)		(3,401	)		(3,766	)		(7,597	)		18,548			(144	)
Interest Expense		8,790			3,500			8,838			8,038			(18,548	)		10,618
Loss on Extinguishment of Debt		(122	)		-			-			122			-			-
Earnings (Loss) from Continuing Operations Before Income Taxes		(4,740	)		(154	)		22,647			18,953			-			36,706
Income Tax Expense (Benefit)		(943	)		(31	)		3,678			3,701			-			6,405
Earnings (Loss) from Continuing Operations Including Noncontrolling Interests		(3,797	)		(123	)		18,969			15,252			-			30,301
Earnings Attributable to Noncontrolling Interests		-			-			-			(111	)		-			(111	)
Earnings (Loss) from Continuing Operations Attributable to Esterline, Net of Tax		(3,797	)		(123	)		18,969			15,141			-			30,190
Loss from Discontinued Operations Attributable to Esterline, Net of Tax		(541	)		-			63			(1,215	)		-			(1,693	)
Equity in Net Earnings of Consolidated Subsidiaries		32,835			10,457			27			-			(43,319	)		-

Net Earnings (Loss) Attributable to Esterline	$	28,497		$	10,334		$	19,059		$	13,926		$	(43,319	)	$	28,497

Comprehensive Income (Loss)	$	(1,797	)	$	14,871		$	19,728		$	(4,972	)	$	(28,820	)	$	(990	)

Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the nine month period ended July 31, 2015.

In Thousands										Non-
				TA Mfg.			Guarantor			Guarantor
	Parent			Ltd.			Subsidiaries			Subsidiaries			Eliminations			Total

Net sales	$	-		$	-		$	668,970		$	776,796		$	(3,125	)	$	1,442,641
Cost of sales		-			-			440,583			526,386			(3,125	)		963,844
		-			-			228,387			250,410			-			478,797
Expenses
Selling, general and administrative		-			71			113,087			173,208			-			286,366
Research, development & engineering		-			-			32,455			46,245			-			78,700
Restructuring charges		-			-			4,588			787			-			5,375
Other (income) expense		-			-			-			(12,744	)		-			(12,744	)
Total Expenses		-			71			150,130			207,496			-			357,697

Operating Earnings from Continuing Operations		-			(71	)		78,257			42,914			-			121,100
Interest Income		(11,922	)		(4,261	)		(18,232	)		(23,485	)		57,453			(447	)
Interest Expense		21,991			4,389			33,633			22,463			(57,453	)		25,023
Loss on Extinguishment of Debt		207			-			-			122			-			329
Earnings (Loss) from Continuing Operations Before Income Taxes		(10,276	)		(199	)		62,856			43,814			-			96,195
Income Tax Expense (Benefit)		(2,052	)		(40	)		10,625			10,564			-			19,097
Earnings (Loss) from Continuing Operations Including Noncontrolling Interests		(8,224	)		(159	)		52,231			33,250			-			77,098
Earnings Attributable to Noncontrolling Interests		-			-			-			(218	)		-			(218	)
Earnings (Loss) from Continuing Operations Attributable to Esterline, Net of Tax		(8,224	)		(159	)		52,231			33,032			-			76,880
Loss from Discontinued Operations Attributable to Esterline, Net of Tax		(1,315	)		-			(9,592	)		(9,347	)		-			(20,254	)
Equity in Net Earnings of Consolidated Subsidiaries		66,165			31,991			140			-			(98,296	)		-

Net Earnings (Loss) Attributable to Esterline	$	56,626		$	31,832		$	42,779		$	23,685		$	(98,296	)	$	56,626

Comprehensive Income (Loss)	$	(95,254	)	$	25,408		$	43,723		$	(109,270	)	$	27,761		$	(107,632	)

Condensed Consolidating Statement of Cash Flows for the nine month period ended July 31, 2015.

In Thousands										Non-
				TA Mfg.			Guarantor			Guarantor
	Parent			Ltd.			Subsidiaries			Subsidiaries			Eliminations			Total

Cash Flows Provided (Used) by Operating Activities
Net earnings (loss) including noncontrolling interests	$	56,844		$	31,832		$	42,779		$	23,685		$	(98,296	)	$	56,844
Depreciation & amortization		-			-			28,339			48,971			-			77,310
Deferred income taxes		(17,829	)		-			16,243			(7,747	)		-			(9,333	)
Share-based compensation		-			5			3,722			4,891			-			8,618
Gain on release of non-income tax liability		-			-			-			(15,656	)		-			(15,656	)
Loss on assets held for sale		-			-			10,842			6,121			-			16,963
Working capital changes, net of effect of acquisitions:
Accounts receivable		577			-			8,228			9,138			-			17,943
Inventories		-			-			(5,268	)		(13,045	)		-			(18,313	)
Prepaid expenses		54			-			(918	)		(1,724	)		-			(2,588	)
Other current assets		6			-			3			133			-			142
Accounts payable		1,095			-			(4,430	)		(13,474	)		-			(16,809	)
Accrued liabilities		(2,286	)		-			(12,976	)		8,073			-			(7,189	)
Federal and foreign income taxes		(7,342	)		(51	)		(2,522	)		1,414			-			(8,501	)
Other liabilities		3,608			-			(528	)		163			-			3,243
Other, net		(28,400	)		-			(42,771	)		72,697			-			1,526
		6,327			31,786			40,743			123,640			(98,296	)		104,200

Cash Flows Provided (Used) by Investing Activities
Purchases of capital assets		(804	)		-			(14,480	)		(22,493	)		-			(37,777	)
Proceeds from sale of discontinued operations		-			-			32,053			-			-			32,053
Acquisition of businesses, net of cash acquired		-			-			-			(171,070	)		-			(171,070	)
		(804	)		-			17,573			(193,563	)		-			(176,794	)

In Thousands										Non-
				TA Mfg.			Guarantor			Guarantor
	Parent			Ltd.			Subsidiaries			Subsidiaries			Eliminations		Total

Cash Flows Provided (Used) by Financing Activities
Proceeds provided by stock issuance under employee stock plans		13,477			-			-			-			-		13,477
Excess tax benefits from stock option exercises		1,877			-			-			-			-		1,877
Shares repurchased		(259,518	)		-			-			-			-		(259,518	)
Repayment of long-term credit facilities		(235,000	)		-			-			-			-		(235,000	)
Repayment of long-term debt		(161,875	)		-			(416	)		(4,774	)		-		(167,065	)
Proceeds from issuance of long-term credit facilities		305,000			-			-			30,000			-		335,000
Proceeds from issuance of long-term debt		-			356,532			-			-			-		356,532
Proceeds from government assistance		-			-			-			3,054			-		3,054
Dividends paid to noncontrolling interests		-			-			-			-			-		-
Debt and other issuance costs		(2,333	)		(5,880	)		-			-			-		(8,213	)
Net change in intercompany financing		333,610			(380,925	)		(60,805	)		9,824			98,296		-
		(4,762	)		(30,273	)		(61,221	)		38,104			98,296		40,144

Effect of Foreign Exchange Rates on Cash and Cash Equivalents		1,059			(518	)		827			(19,380	)		-		(18,012	)

Net Increase (Decrease) in Cash and Cash Equivalents		1,820			995			(2,078	)		(51,199	)		-		(50,462	)
Cash and Cash Equivalents - Beginning of Year		14,634			-			3,454			220,056			-		238,144

Cash and Cash Equivalents - End of Period	$	16,454		$	995		$	1,376		$	168,857		$	-	$	187,682

In Thousands									Non-
				TA Mfg.		Guarantor			Guarantor
	Parent			Ltd.		Subsidiaries			Subsidiaries		Eliminations			Total
ASSETS

Current Assets
Cash and cash equivalents	$	14,634		$	-	$	3,454		$	220,056	$	-		$	238,144
Accounts receivable, net		610			-		143,158			236,121		-			379,889
Inventories		-			-		188,982			244,613		-			433,595
Income tax refundable		-			-		-			5,266		-			5,266
Deferred income tax benefits		31,486			-		(1,191	)		18,384		-			48,679
Prepaid expenses		147			-		6,703			13,486		-			20,336
Other current assets		80			-		114			1,955		-			2,149
Current assets of businesses held for sale		-			-		26,800			14,646		-			41,446
Total Current Assets		46,957			-		368,020			754,527		-			1,169,504

Property, Plant & Equipment, Net		1,489			-		158,089			159,764		-			319,342
Goodwill		-			-		347,700			724,086		-			1,071,786
Intangibles, net		-			-		106,164			365,213		-			471,377
Debt issuance costs, net		4,134			-		-			161		-			4,295
Deferred income tax benefits		20,455			-		30			50,822		-			71,307
Other assets		130			-		7,502			6,547		-			14,179
Non-current assets of businesses held for sale		-			-		40,737			30,940		-			71,677
Amounts Due From (To) Subsidiaries		-			-		797,342			-		(797,342	)		-
Investment in Subsidiaries		3,307,454			-		1,127,237			20,768		(4,455,459	)		-
Total Assets	$	3,380,619		$	-	$	2,952,821		$	2,112,828	$	(5,252,801	)	$	3,193,467


LIABILITIES AND SHAREHOLDERS' EQUITY

Current Liabilities
Accounts payable	$	1,751		$	-	$	36,905		$	76,628	$	-		$	115,284
Accrued liabilities		20,178			-		93,168			149,190		-			262,536
Current maturities of long-term debt		8,750			-		349			3,675		-			12,774
Deferred income tax liabilities		76			-		8			1,689		-			1,773
Federal and foreign income taxes		(2,282	)		-		(2,643	)		6,496		-			1,571
Current liabilities of businesses held for sale		-			-		4,010			10,181		-			14,191
Total Current Liabilities		28,473			-		131,797			247,859		-			408,129

Credit Facilities		100,000			-		-			-		-			100,000
Long-Term Debt, Net		403,125			-		55,176			51,419		-			509,720
Deferred Income Tax Liabilities		58,615			-		(17,333	)		107,883		-			149,165
Pension and Post-Retirement Obligations		18,683			-		1,226			42,784		-			62,693
Other Liabilities		16,762			-		3,944			26,178		-			46,884
Non-current liabilities of businesses held for sale		-			-		17,327			1,549		-			18,876
Amounts Due To (From) Subsidiaries		856,961			-		-			456,861		(1,313,822	)		-
Shareholders' Equity		1,898,000			-		2,760,684			1,178,295		(3,938,979	)		1,898,000
Total Liabilities and Shareholders' Equity	$	3,380,619		$	-	$	2,952,821		$	2,112,828	$	(5,252,801	)	$	3,193,467

Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the three month period ended August 1, 2014.

(In thousands)							Non-
In Thousands																								Non-
																			TA Mfg.		Guarantor			Guarantor
				Guarantor			Guarantor									Parent			Ltd.		Subsidiaries			Subsidiaries			Eliminations			Total
	Parent			Subsidiaries			Subsidiaries			Eliminations			Total
Net sales	$	-		$	248,443		$	284,366		$	(1,685	)	$	531,124		$	-		$	-	$	239,134		$	268,860		$	(1,685	)	$	506,309
Cost of sales		-			156,486			193,850			(1,685	)		348,651			-			-		150,139			180,768			(1,685	)		329,222
		-			91,957			90,516			-			182,473			-			-		88,995			88,092			-			177,087
Expenses
Selling, general and administrative		-			37,686			57,607			-			95,293			-			-		33,454			55,430			-			88,884
Research, development and engineering		-			11,452			13,682			-			25,134
Research, development & engineering																	-			-		10,932			13,327			-			24,259
Restructuring charges		-			2,577			828			-			3,405			-			-		2,577			828			-			3,405
Goodwill impairment		-			-			-			-			-
Other (income) expense																	-			-		-			-			-			-
Total Expenses		-			51,715			72,117			-			123,832			-			-		46,963			69,585			-			116,548

Operating Earnings from Continuing Operations		-			40,242			18,399			-			58,641			-			-		42,032			18,507			-			60,539
Interest Income		(3,837	)		(1,948	)		(13,932	)		19,571			(146	)		(3,837	)		-		(1,948	)		(13,931	)		19,571			(145	)
Interest Expense		5,777			6,832			14,832			(19,571	)		7,870			5,777			-		6,832			14,827			(19,571	)		7,865
Loss on Extinguishment of Debt		-			-			533			-			533			-			-		-			533			-			533
Earnings (Loss) from Continuing Operations Before Income Taxes		(1,940	)		35,358			16,966			-			50,384			(1,940	)		-		37,148			17,078			-			52,286
Income Tax Expense (Benefit)		(466	)		7,446			4,450			-			11,430			(466	)		-		8,449			4,420			-			12,403
Earnings (Loss) from Continuing Operations Including Noncontrolling Interests		(1,474	)		27,912			12,516			-			38,954			(1,474	)		-		28,699			12,658			-			39,883
Earnings Attributable to Noncontrolling Interests		-			-			(46	)		-			(46	)		-			-		-			(46	)		-			(46	)
Earnings (Loss) from Continuing Operations Attributable to Esterline, Net of Tax		(1,474	)		27,912			12,470			-			38,908			(1,474	)		-		28,699			12,612			-			39,837
Loss from Discontinued Operations Attributable to Esterline, Net of Tax		-			-			-			-			-			-			-		(787	)		(142	)		-			(929	)
Equity in Net Earnings of Consolidated Subsidiaries		40,382			883			114			(41,379	)		-			40,382			-		883			114			(41,379	)		-

Net Earnings (Loss) Attributable to Esterline	$	38,908		$	28,795		$	12,584		$	(41,379	)	$	38,908		$	38,908		$	-	$	28,795		$	12,584		$	(41,379	)	$	38,908

Comprehensive Income (Loss)	$	15,707		$	26,224		$	(9,163	)	$	(16,289	)	$	16,479		$	15,707		$	-	$	26,224		$	(9,163	)	$	(16,289	)	$	16,479

Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the nine month period ended August 1, 2014.

(In thousands)							Non-
In Thousands																								Non-
																			TA Mfg.		Guarantor			Guarantor
				Guarantor			Guarantor									Parent			Ltd.		Subsidiaries			Subsidiaries			Eliminations			Total
	Parent			Subsidiaries			Subsidiaries			Eliminations			Total
Net sales	$	-		$	733,826		$	836,055		$	(4,203	)	$	1,565,678		$	-		$	-	$	702,424		$	804,889		$	(4,203	)	$	1,503,110
Cost of sales		-			468,901			562,867			(4,203	)		1,027,565			-			-		446,042			534,224			(4,203	)		976,063
		-			264,925			273,188			-			538,113			-			-		256,382			270,665			-			527,047
Expenses
Selling, general and administrative		-			120,154			169,815			-			289,969			-			-		107,162			162,889			-			270,051
Research, development and engineering		-			37,005			41,436			-			78,441
Research, development & engineering																	-			-		35,245			40,196			-			75,441
Restructuring charges		-			6,898			3,381			-			10,279			-			-		6,898			3,381			-			10,279
Goodwill impairment		-			-			-			-			-
Other (income) expense																	-			-		-			-			-			-
Total Expenses		-			164,057			214,632			-			378,689			-			-		149,305			206,466			-			355,771

Operating Earnings from Continuing Operations		-			100,868			58,556			-			159,424			-			-		107,077			64,199			-			171,276
Interest Income		(11,588	)		(5,886	)		(42,306	)		59,377			(403	)		(11,588	)		-		(5,886	)		(42,303	)		59,377			(400	)
Interest Expense		18,350			20,619			45,347			(59,377	)		24,939			18,350			-		20,619			45,332			(59,377	)		24,924
Loss on Extinguishment of Debt		-			-			533			-			533			-			-		-			533			-			533
Earnings (Loss) from Continuing Operations Before Income Taxes		(6,762	)		86,135			54,982			-			134,355			(6,762	)		-		92,344			60,637			-			146,219
Income Tax Expense (Benefit)		(1,462	)		18,122			11,033			-			27,693			(1,462	)		-		20,686			12,191			-			31,415
Earnings (Loss) from Continuing Operations Including Noncontrolling Interests		(5,300	)		68,013			43,949			-			106,662			(5,300	)		-		71,658			48,446			-			114,804
Earnings Attributable to Noncontrolling Interests		-			-			(429	)		-			(429	)		-			-		-			(429	)		-			(429	)
Earnings (Loss) from Continuing Operations Attributable to Esterline, Net of Tax		(5,300	)		68,013			43,520			-			106,233			(5,300	)		-		71,658			48,017			-			114,375
Loss from Discontinued Operations Attributable to Esterline, Net of Tax		(343	)		-			-			-			(343	)		(343	)		-		(3,645	)		(4,497	)		-			(8,485	)
Equity in Net Earnings of Consolidated Subsidiaries		111,533			2,117			1,434			(115,084	)		-			111,533			-		2,117			1,434			(115,084	)		-

Net Earnings (Loss) Attributable to Esterline	$	105,890		$	70,130		$	44,954		$	(115,084	)	$	105,890		$	105,890		$	-	$	70,130		$	44,954		$	(115,084	)	$	105,890

Comprehensive Income (Loss)	$	88,374		$	68,693		$	35,471		$	(106,376	)	$	86,162		$	88,374		$	-	$	68,693		$	35,471		$	(106,376	)	$	86,162

Condensed Consolidating Statement of Cash Flows for the nine month period ended August 1, 2014.

(In thousands)

Non-

Guarantor

Guarantor

Parent

Subsidiaries

Subsidiaries

Eliminations

Total

Cash Flows Provided (Used) by Operating Activities

Net earnings (loss) including
   noncontrolling interests

$
106,319

$
70,130

$
44,954

$
(115,084
)

$
106,319

Depreciation & amortization

-

32,336

55,107

-

87,443

Deferred income taxes

(4,971
)

(2
)

(8,131
)

-

(13,104
)
Share-based compensation

-

4,248

5,585

-

9,833

Gain from sale of capital assets

-

-

-

-

-

Goodwill impairment

-

-

-

-

-

Working capital changes, net of effect
   of acquisitions:

Accounts receivable

528

13,887

9,065

-

23,480

Inventories

-

(17,289
)

(25,122
)

-

(42,411
)
Prepaid expenses

(52
)

(1,913
)

(4,237
)

-

(6,202
)
Other current assets

2

(1
)

(100
)

-

(99
)
Accounts payable

117

3,585

(8,210
)

-

(4,508
)
Accrued liabilities

(10,486
)

(1,534
)

(4,438
)

-

(16,458
)
Federal and foreign income taxes

(4,462
)

21,809

(25,330
)

-

(7,983
)
Other liabilities

5,415

95

(6,950
)

-

(1,440
)
Other, net

(497
)

(10,962
)

11,304

-

(155
)

91,913

114,389

43,497

(115,084
)

134,715

Cash Flows Provided (Used) by Investing Activities

Purchases of capital assets

(186
)

(11,748
)

(23,075
)

-

(35,009
)
Proceeds from sale of capital assets

-

-

-

-

-

Acquisition of business, net of cash
   acquired

-

(44,745
)

-

-

(44,745
)

(186
)

(56,493
)

(23,075
)

-

(79,754
)

(In thousands)

Non-

Guarantor

Guarantor

Parent

Subsidiaries

Subsidiaries

Eliminations

Total

Cash Flows Provided (Used) by Financing Activities

Proceeds provided by stock issuance under
   employee stock plans

23,173

-

-

-

23,173

Excess tax benefits from stock option
   exercises

6,392

-

-

-

6,392

Share repurchases

(5,176
)

-

-

-

(5,176
)
Repayment of long-term credit facilities

(40,000
)

-

-

-

(40,000
)
Repayment of long-term debt

(6,562
)

(245
)

(27,269
)

-

(34,076
)
Proceeds from issuance of long-term
   credit facilities

25,000

-

-

-

25,000

Proceeds from government assistance

-

-

3,362

-

3,362

Dividends paid to noncontrolling interests

-

-

(780
)

-

(780
)
Debt and other issuance costs

-

-

-

-

-

Net change in intercompany financing

(98,319
)

(56,888
)

40,123

115,084

-

(95,492
)

(57,133
)

15,436

115,084

(22,105
)

Effect of Foreign Exchange Rates on Cash
   and Cash Equivalents

(22
)

(22
)

(1,534
)

-

(1,578
)

Net Increase (Decrease) in Cash and
   Cash Equivalents

(3,787
)

741

34,324

-

31,278

Cash and Cash Equivalents -
   Beginning of Period

7,826

4,876

166,476

-

179,178

Cash and Cash Equivalents - End of Period

$
4,039

$
5,617

$
200,800

$
-

$
210,456

(In thousands)

Non-

Guarantor

Guarantor

Parent

Subsidiaries

Subsidiaries

Eliminations

Total

ASSETS

Current Assets

Cash and cash equivalents

$
7,826

$
4,876

$
166,476

$
-

$
179,178

Cash in escrow

4,018

-

-

-

4,018

Accounts receivable, net

316

154,492

228,858

-

383,666

Inventories

-

190,830

256,833

-

447,663

Income tax refundable

-

6,526

-

-

6,526

Deferred income tax benefits

26,731

171

20,375

-

47,277

Prepaid expenses

117

5,510

12,556

-

18,183

Other current assets

86

115

5,003

-

5,204

Total Current Assets

39,094

362,520

690,101

-

1,091,715

Property, Plant & Equipment, Net

1,754

175,402

194,041

-

371,197

Goodwill

-

344,995

783,982

-

1,128,977

Intangibles, net

-

144,222

436,727

-

580,949

Debt issuance costs, net

5,252

-

959

-

6,211

Deferred income tax benefits

16,782

-

55,058

-

71,840

Other assets

18

3,692

7,513

-

11,223

Amounts Due From (To) Subsidiaries

-

549,307

-

(549,307
)

-

Investment in Subsidiaries

2,588,478

979,123

349,104

(3,916,705
)

-

Total Assets

$
2,651,378

$
2,559,261

$
2,517,485

$
(4,466,012
)

$
3,262,112

LIABILITIES AND SHAREHOLDERS' EQUITY

Current Liabilities

Accounts payable

$
1,714

$
29,064

$
92,819

$
-

$
123,597

Accrued liabilities

21,652

87,826

144,083

-

253,561

Current maturities of long-term debt

8,750

237

12,292

-

21,279

Deferred income tax liabilities

568

24

1,715

-

2,307

Federal and foreign income taxes

2,408

(27,399
)

32,339

-

7,348

Total Current Liabilities

35,092

89,752

283,248

-

408,092

Credit Facilities

130,000

-

-

-

130,000

Long-Term Debt, Net

411,875

55,562

70,422

-

537,859

Deferred Income Tax Liabilities

57,757

(7
)

135,369

-

193,119

Pension and Post-Retirement Obligations

17,500

618

49,984

-

68,102

Other Liabilities

12,298

194

27,696

-

40,188

Amounts Due To (From) Subsidiaries

102,104

-

405,018

(507,122
)

-

Shareholders' Equity

1,884,752

2,413,142

1,545,748

(3,958,890
)

1,884,752

Total Liabilities and Shareholders' Equity

$
2,651,378

$
2,559,261

$
2,517,485

$
(4,466,012
)

$
3,262,112

~~Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the three month period ended July 26, 2013.~~

(In thousands)

Non-

Guarantor

Guarantor

Parent

Subsidiaries

Subsidiaries

Eliminations

Total

Net sales

$
-

$
216,949

$
262,068

$
(949
)

$
478,068

Cost of sales

-

132,786

167,329

(949
)

299,166

-

84,163

94,739

-

178,902

Expenses

Selling, general and administrative

-

38,045

63,777

-

101,822

Research, development and engineering

-

12,684

11,419

-

24,103

Restructuring charges

-

-

-

-

-

Goodwill impairment

-

-

3,454

-

3,454

Total Expenses

-

50,729

78,650

-

129,379

Operating Earnings from Continuing
   Operations

-

33,434

16,089

-

49,523

Interest Income

(4,028
)

(2,028
)

(13,198
)

19,122

(132
)
Interest Expense

6,489

7,052

14,631

(19,122
)

9,050

Loss on Extinguishment of Debt

-

-

-

-

-

Earnings (Loss) from Continuing Operations
   Before Income Taxes

(2,461
)

28,410

14,656

-

40,605

Income Tax Expense (Benefit)

(671
)

6,264

(4,442
)

-

1,151

Earnings (Loss) from Continuing Operations
   Including Noncontrolling Interests

(1,790
)

22,146

19,098

-

39,454

Earnings Attributable to Noncontrolling
   Interests

-

-

(241
)

-

(241
)
Earnings (Loss) from Continuing Operations
   Attributable to Esterline, Net of Tax

(1,790
)

22,146

18,857

-

39,213

Loss from Discontinued Operations
   Attributable to Esterline, Net of Tax

(975
)

-

-

-

(975
)
Equity in Net Earnings of Consolidated
   Subsidiaries

41,003

294

50

(41,347
)

-

Net Earnings (Loss) Attributable to Esterline

$
38,238

$
22,440

$
18,907

$
(41,347
)

$
38,238

Comprehensive Income (Loss)

$
45,816

$
22,610

$
26,689

$
(49,914
)

$
45,201

In Thousands									Non-
				TA Mfg.		Guarantor			Guarantor
	Parent			Ltd.		Subsidiaries			Subsidiaries			Eliminations			Total

Cash Flows Provided (Used) by Operating Activities
Net earnings (loss) including noncontrolling interests	$	106,319		$	-	$	70,130		$	44,954		$	(115,084	)	$	106,319
Depreciation & amortization		-			-		32,336			55,107			-			87,443
Deferred income taxes		(4,971	)		-		(2	)		(8,131	)		-			(13,104	)
Share-based compensation		-			-		4,248			5,585			-			9,833
Gain on release of non-income tax liability		-			-		-			-			-			-
Loss on assets held for sale		-			-		-			-			-			-
Working capital changes, net of effect of acquisitions:
Accounts receivable		528			-		13,887			9,065			-			23,480
Inventories		-			-		(17,289	)		(25,122	)		-			(42,411	)
Prepaid expenses		(52	)		-		(1,913	)		(4,237	)		-			(6,202	)
Other current assets		2			-		(1	)		(100	)		-			(99	)
Accounts payable		117			-		3,585			(8,210	)		-			(4,508	)
Accrued liabilities		(10,486	)		-		(1,534	)		(4,438	)		-			(16,458	)
Federal and foreign income taxes		(4,462	)		-		21,809			(25,330	)		-			(7,983	)
Other liabilities		5,415			-		95			(6,950	)		-			(1,440	)
Other, net		(497	)		-		(10,962	)		11,304			-			(155	)
		91,913			-		114,389			43,497			(115,084	)		134,715

Cash Flows Provided (Used) by Investing Activities
Purchases of capital assets		(186	)		-		(11,748	)		(23,075	)		-			(35,009	)
Proceeds from sale of discontinued operations		-			-		-			-			-			-
Acquisition of businesses, net of cash acquired		-			-		(44,745	)		-			-			(44,745	)
		(186	)		-		(56,493	)		(23,075	)		-			(79,754	)

~~Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the nine month period ended July 26, 2013.~~

(In thousands)

Non-

Guarantor

Guarantor

Parent

Subsidiaries

Subsidiaries

Eliminations

Total

Net sales

$
-

$
653,959

$
784,389

$
(2,756
)

$
1,435,592

Cost of sales

-

405,830

511,895

(2,756
)

914,969

-

248,129

272,494

-

520,623

Expenses

Selling, general and administrative

-

112,881

185,830

-

298,711

Research, development and engineering

-

37,448

35,389

-

72,837

Restructuring charges

-

-

-

-

-

Goodwill impairment

-

-

3,454

-

3,454

Total Expenses

-

150,329

224,673

-

375,002

Operating Earnings from Continuing
   Operations

-

97,800

47,821

-

145,621

Interest Income

(11,680
)

(5,723
)

(41,022
)

58,044

(381
)
Interest Expense

23,722

20,019

45,279

(58,044
)

30,976

Loss on Extinguishment of Debt

946

-

-

-

946

Earnings (Loss) from Continuing Operations
   Before Income Taxes

(12,988
)

83,504

43,564

-

114,080

Income Tax Expense (Benefit)

(2,894
)

15,178

743

-

13,027

Earnings (Loss) from Continuing Operations
   Including Noncontrolling Interests

(10,094
)

68,326

42,821

-

101,053

Earnings Attributable to Noncontrolling
   Interests

-

-

(1,207
)

-

(1,207
)
Earnings (Loss) from Continuing Operations
   Attributable to Esterline, Net of Tax

(10,094
)

68,326

41,614

-

99,846

Loss from Discontinued Operations
   Attributable to Esterline, Net of Tax

(975
)

-

-

-

(975
)
Equity in Net Earnings of Consolidated
   Subsidiaries

109,940

677

80

(110,697
)

-

Net Earnings (Loss) Attributable to Esterline

$
98,871

$
69,003

$
41,694

$
(110,697
)

$
98,871

Comprehensive Income (Loss)

$
87,090

$
68,102

$
35,100

$
(106,833
)

$
83,459

~~Condensed Consolidating Statement of Cash Flows for the nine month period ended July 26, 2013.~~

(In thousands)

Non-

Guarantor

Guarantor

Parent

Subsidiaries

Subsidiaries

Eliminations

Total

Cash Flows Provided (Used) by Operating Activities

Net earnings (loss) including
   noncontrolling interests

$
100,078

$
69,003

$
41,694

$
(110,697
)

$
100,078

Depreciation & amortization

-

35,547

52,394

-

87,941

Deferred income taxes

11,252

(332
)

(23,158
)

-

(12,238
)
Share-based compensation

-

3,321

4,346

-

7,667

Gain from sale of capital assets

-

(322
)

(593
)

(915
)
Goodwill impairment

-

-

3,454

-

3,454

Working capital changes, net of effect
   of acquisitions:

Accounts receivable

(311
)

14,744

36,630

-

51,063

Inventories

-

(17,500
)

(15,274
)

-

(32,774
)
Prepaid expenses

29

287

(451
)

-

(135
)
Other current assets

22

433

(1,291
)

-

(836
)
Accounts payable

449

1,616

3,359

-

5,424

Accrued liabilities

9,740

7,382

(12,845
)

-

4,277

Federal and foreign income taxes

1,607

(3,706
)

(3,222
)

-

(5,321
)
Other liabilities

11,907

(13,422
)

(8,879
)

-

(10,394
)
Other, net

1,284

(675
)

(1,621
)

-

(1,012
)

136,057

96,376

74,543

(110,697
)

196,279

Cash Flows Provided (Used) by Investing Activities

Purchases of capital assets

(105
)

(11,949
)

(25,711
)

-

(37,765
)
Proceeds from sale of capital assets

-

322

593

-

915

Acquisition of business, net of cash
   acquired

-

-

(40,689
)

-

(40,689
)

(105
)

(11,627
)

(65,807
)

-

(77,539
)

(In thousands)

Non-

Guarantor

Guarantor

Parent

Subsidiaries

Subsidiaries

Eliminations

Total

Cash Flows Provided (Used) by Financing Activities

Proceeds provided by stock issuance under
   employee stock plans

20,450

-

-

-

20,450

Excess tax benefits from stock option
   exercises

2,237

-

-

-

2,237

Shares repurchased

-

-

-

-

-

Repayment of long-term credit facilities

(70,000
)

-

-

-

(70,000
)
Repayment of long-term debt

(177,187
)

(151
)

(32,203
)

-

(209,541
)
Proceeds from issuance of long-term
   credit facilities

175,000

-

-

-

175,000

Proceeds from government assistance

-

-

5,114

-

5,114

Dividends paid to noncontrolling interests

-

-

(1,044
)

-

(1,044
)
Debt and other issuance costs

(453
)

-

-

-

(453
)
Net change in intercompany financing

(81,084
)

(84,563
)

54,950

110,697

-

(131,037
)

(84,714
)

26,817

110,697

(78,237
)

Effect of Foreign Exchange Rates on Cash
   and Cash Equivalents

5

(12
)

(1,923
)

-

(1,930
)

Net Increase (Decrease) in Cash and
   Cash Equivalents

4,920

23

33,630

-

38,573

Cash and Cash Equivalents -
   Beginning of Period

16,770

1,324

142,581

-

160,675

Cash and Cash Equivalents - End of Period

$
21,690

$
1,347

$
176,211

$
-

$
199,248

In Thousands									Non-
				TA Mfg.		Guarantor			Guarantor
	Parent			Ltd.		Subsidiaries			Subsidiaries			Eliminations		Total

Cash Flows Provided (Used) by Financing Activities
Proceeds provided by stock issuance under employee stock plans		23,173			-		-			-			-		23,173
Excess tax benefits from stock option exercises		6,392			-		-			-			-		6,392
Shares repurchased		(5,176	)		-		-			-			-		(5,176	)
Repayment of long-term credit facilities		(40,000	)		-		-			-			-		(40,000	)
Repayment of long-term debt		(6,562	)		-		(245	)		(27,269	)		-		(34,076	)
Proceeds from issuance of long-term credit facilities		25,000			-		-			-			-		25,000
Proceeds from issuance of long-term debt		-			-		-			-			-		-
Proceeds from government assistance		-			-		-			3,362			-		3,362
Dividends paid to noncontrolling interests		-			-		-			(780	)		-		(780	)
Debt and other issuance costs		-			-		-			-			-		-
Net change in intercompany financing		(98,319	)		-		(56,888	)		40,123			115,084		-
		(95,492	)		-		(57,133	)		15,436			115,084		(22,105	)

Effect of Foreign Exchange Rates on Cash and Cash Equivalents		(22	)		-		(22	)		(1,534	)		-		(1,578	)

Net Increase (Decrease) in Cash and Cash Equivalents		(3,787	)		-		741			34,324			-		31,278
Cash and Cash Equivalents - Beginning of Year		7,826			-		4,876			166,476			-		179,178

Cash and Cash Equivalents - End of Period	$	4,039		$	-	$	5,617		$	200,800		$	-	$	210,456

We operate our businesses in three segments: Avionics & Controls, Sensors & Systems and Advanced Materials. Our segments are structured around our technical capabilities. Sales in all segments include domestic, international, defense and commercial customers.

The Avionics & Controls segment includes avionics systems, control and communication systems, and interface technologies capabilities. Avionics systems designs and develops cockpit systems integration and avionics solutions for commercial and military applications. Control and communication systems designs and manufactures technology interface systems for military and commercial aircraft and land- and sea-based military vehicles. Additionally, control and communication systems designs and manufactures military audio and data products for severe battlefield environments ~~embedded communication intercept receivers for signal intelligence applications, as well as~~and communication control systems to enhance security and aural clarity in military applications. Defense, aerospace and training display (DAT), which will be integrated into our avionics systems and control and communication systems capabilities develops and manufactures visualization solutions for a variety of demanding defense and commercial aerospace applications. Interface technologies manufactures and develops custom control panels, input systems for medical, industrial, military and gaming industries.

The Sensors & Systems segment includes power systems, connection technologies and advanced sensors capabilities. Power systems develops and manufactures electrical power switching and other related systems, principally for aerospace and defense customers. Connection technologies develops and manufactures highly engineered connectors for harsh environments and serves the aerospace, defense & space, power generation, rail and industrial equipment markets. Advanced sensors develops and manufactures ~~high-precision~~high precision temperature and pressure sensors for aerospace and defense customers.

The Advanced Materials segment includes engineered materials and defense technologies capabilities. Engineered materials develops and manufactures thermally engineered components and high-performance elastomer products used in a wide range of commercial aerospace and military applications. Defense technologies develops and manufactures combustible ordnance components and ~~airborne~~warfare countermeasure devices for military customers.

Our current business and strategic plan focuses on the continued development of our products principally for aerospace and defense markets. We are concentrating our efforts to expand our capabilities in these markets and to anticipate the global needs of our customers and respond to such needs with comprehensive solutions. These efforts focus on continuous research and new product development, acquisitions and strategic realignments of operations to expand our capabilities as a more comprehensive supplier to our customers across our entire product offering. Our business has been impacted by reductions in defense spending.

On January 31, 2015, we acquired the DAT business of Belgium-based Barco N.V. (Barco) for €150 million net of acquired cash, or approximately $171 million in cash. A working capital adjustment of approximately $15 million was paid by Barco subsequent to July 31, 2015. We financed the acquisition primarily using international cash reserves, with the balance funded by borrowings under our existing credit facility. DAT develops and manufactures visualization solutions for a variety of demanding defense and commercial aerospace applications. DAT employs roughly 600 people in Belgium, France, Israel, Singapore and the U.S. The display business is included in our Avionics & Controls segment. We incurred a $2.9 million foreign currency exchange loss in funding the acquisition at the end of the first fiscal quarter of 2015. We estimate that DAT will break even in fiscal 2015, excluding integration and purchase accounting expenses and the above referenced foreign currency loss.

In September 3, 2014, our board of directors approved ~~the~~a plan to sell certain non-core business units including Eclipse Electronic Systems, Inc. (Eclipse), a manufacturer of embedded communication intercept receivers for signal intelligence ~~applications,~~applications; Wallop Defence Systems, Ltd. (Wallop), a manufacturer of flare countermeasure ~~devices,~~devices; Pacific Aerospace and Electronics Inc. (PA&E), a manufacturer of hermetically sealed electrical ~~connectors,~~connectors; and ~~an immaterial~~a small distribution business. These ~~businesses were not separate reporting~~business units as defined under U.S. GAAP and no indicator of impairment existed at August 1, 2014, requiring an impairment test of their corresponding reporting units’ goodwill or these businesses’ long-lived assets. Due to our plan to sell these businesses, during the fourth fiscal quarter of 2014, the assets will be valued at fair value and goodwill of the reporting unit will be allocated to each business unit based upon the relative fair value of the business unit and the reporting unit. Eclipse and the distribution business are included in our Avionics & Controls segment, Wallop is included in our Advanced Materials segment, and PA&E is included in our Sensors & Systems segment. Beginning in our fourth fiscal quarter of 2014, these businesses will be reported as discontinued ~~operations.~~operations for all periods presented. Based upon ~~a range of projected~~the estimated fair values, we ~~expect to incur~~incurred an estimated after-tax loss ~~between $55 million and $75~~of $49.5 million in the fourth ~~fiscal~~ quarter of fiscal 2014 on the assets held for sale in discontinued operations. During the first nine months of fiscal 2015 and 2014, we incurred a loss on discontinued operations of $20.3 million and $8.5 million, respectively. On June 5, 2015, we sold Eclipse for approximately $10 million. We retained ownership of the land, building and building improvements, which are being held for sale. In addition, on July 20, 2015, we sold PA&E for approximately $22 million. The selling price for both businesses is subject to customary working capital adjustments.

On June 19, 2014, our board of directors approved a share repurchase program and authorized the repurchase of up to $200 million ~~share~~of outstanding shares of common stock. In March 2015, our board of directors authorized an additional $200 million for repurchase of outstanding shares of common stock under the program. Under the program, ~~we are~~the Company is authorized to repurchase up to ~~$200~~$400 million of the outstanding shares of common stock from time to time, depending on market conditions, share price and other factors. During ~~the third~~ fiscal ~~quarter of~~ 2014, we repurchased ~~45,979~~269,228 shares under this program at an average price paid per share of ~~$112.57,~~$112.40, for an aggregate purchase price of ~~$5.2~~$30.3 million. During the first nine months of fiscal 2015, we repurchased 2,562,122 shares under this program at an average price paid per share of $101.29, for an aggregate purchase price of $259.5 million.

In March 2014, we entered into a Consent Agreement with the U.S. Department of State’s Directorate of Defense Trade Controls Office of Defense Trade Controls Compliance (DDTC) to resolve alleged International Traffic in Arms Regulations (ITAR) civil violations. Among other things, the Consent Agreement requires us to pay a $20 million penalty, of which $10 million was suspended and eligible for offset credit based upon verified expenditures for past and future remedial actions, and to continue to implement ongoing compliance remedial measures and to implement additional remedial measures related to ITAR compliance activities. As a result of these remedial measures, remedial compliance expense was $15 million in the first nine months of fiscal 2015 compared with $7 million in the same period in fiscal 2014. More information about the Consent Agreement is set forth in Note 9 to the Consolidated Financial Statements included in Part 1, Item 1 of this report.

On December 20, 2013, we acquired ~~the~~ Sunbank Family of Companies, LLC (Sunbank) for $51.7 million. The purchase price included $5 million in additional contingent consideration based upon achievement of certain sales levels over a two-year period. Sunbank is a manufacturer of electrical cable accessories, connectors and flexible conduit systems. Sunbank is included in the Sensors & Systems segment.

On December 5, 2013, we announced the acceleration of our plans to consolidate certain facilities and create cost efficiencies through shared services in sales, general and administrative and support functions. ~~Our~~For fiscal 2014 and 2015 our integration activities are expected to result in aggregate charges and expenses of ~~approximately $40 million over the next two years. We expect to incur costs of $20 million to $25~~$35 million. Total restructuring expenses were $20.4 million in fiscal ~~2014, with the balance to be incurred~~2014. Restructuring expenses in fiscal ~~2015. The costs include~~2014 were mainly comprised of $5.7 million in severance and $11.9 million in exit and relocation of facilities expenses, and ~~losses from~~a $2.8 million loss on the write off of certain property, plant and equipment. Total restructuring expenses in the first nine months of fiscal 2015 were $10.1 million, of which $5.4 million was reported separately as restructuring expenses and $4.7 million was reported as cost of goods sold. Total restructuring expenses in the first nine months of fiscal 2014 were $14.3 million, of which $10.3 million was reported separately as restructuring expenses and $4.0 million was reported as cost of goods sold. Expense savings were $11.5 million in the first nine months of fiscal 2015.

For further explanation about changes in sales and gross margin in the third fiscal quarter of 2015 over the prior year period, please see the table at the end of the Overview section for a roll forward presentation of sales and gross margin.

Total sales for the third fiscal quarter decreased by $10.1 million, or 2.0%, over the prior-year period. Sales decreased $23 million due to the effect of a weakening Canadian dollar, U.K. pound and euro compared with the prior-year period. Additionally, sales decreased $5 million due the impact of the settlement of forward foreign currency contracts qualifying under hedge accounting. These decreases were partially offset by $32 million in incremental sales from the DAT acquisition. Excluding the foreign currency exchange effects and the other items listed in the roll forward, sales volume decreased $14 million compared with the prior-year period and was mainly due to lower demand for Avionics & Controls and Advanced Materials segment products.

Consolidated gross margin was 34.2% in the third fiscal quarter of 2015 compared with 35.0% in the prior-year period. Gross margin in the third quarter of fiscal 2015 was impacted by lower sales volume and mix of Avionics & Controls and Advanced Materials. Additionally, Avionics & Controls gross margin was impacted by an inventory fair value adjustment due to the shipment of acquired DAT inventory recorded at fair value. Sensors & Systems segment gross margin improved over the prior-year period on ~~short-cycle activities will commence~~stronger sales mix.

Selling, general and administrative expense increased by $3.1 million and by 0.9 percentage points over the prior-year period to 18.5% of sales, reflecting incremental selling, general and administrative expenses from the acquisition of DAT of $8.9 million and a $7.9 million increase in corporate expense, mainly due to increased expenses for compliance activities. These increases were partially offset by the favorable translation effects of foreign currencies.

Research, development and engineering spending increased by $5.0 million over the prior-year period to 5.9% of sales due to incremental research, development and engineering expenses from the acquisition of DAT of $7.7 million, partially offset by lower spending for Avionics & Controls research, development and engineering.

The income tax rate was 17.4% in the third fiscal ~~2014,~~quarter of 2015 compared with ~~substantially~~23.7% in the prior-year period, mainly reflecting certain discrete tax benefits and additional tax benefits resulting from DAT operating losses.

Earnings from continuing operations in the third fiscal quarter of 2015 were $30.2 million, or $0.97 per diluted share, compared with $39.8 million, or $1.22 per diluted share, in the prior-year period. Loss from discontinued operations in the third fiscal quarter of 2015 was $1.7 million, or $0.05 per diluted share, compared with $0.9 million, or $0.03 per diluted share, in the prior-year period. Net income in the third fiscal quarter was $28.5 million, or $0.92 per diluted share, compared with $38.9 million, or $1.19 per diluted share, in the prior-year period.

For further explanation about changes in sales and gross margin for the first nine months of fiscal 2015 over the prior year period, please see the table at the end of the Overview section for a roll forward presentation of sales and gross margin.

~~more savings projected in~~Sales for the first nine months of fiscal ~~2015. We expect these projects~~2015 decreased $60 million, or 4.0%, over the prior-year period. Sales decreased $55 million due to ~~result in savings in excess~~effects of a weakening Canadian dollar, U.K. pound and euro compared with the prior-year period. Additionally, sales decreased $15 million ~~annually commencing~~due to the settlement of forward foreign currency contracts qualifying under hedge accounting. These decreases were partially offset by $62 million in incremental sales from the DAT acquisition. Excluding the foreign currency exchange effects and the other items noted in the roll forward, sales volume decreased $53 million compared with the prior-year period and was due to lower demand across all three segments.

Consolidated gross margin was 33.2% in the first nine months of fiscal ~~2016.~~2015 compared with 35.1% in the prior-year period. Gross margin was mainly impacted by the effect of weakening foreign currencies, an unfavorable estimate at completion (EAC) for certain long-term development contracts, and the impact from the settlement of our foreign currency forward contracts in the period. Additionally, gross margin was impacted by an inventory fair value adjustment due to the shipment of acquired DAT inventory recognized at fair value. Gross margin was also impacted by unfavorable sales mix at Avionics & Controls and Advanced Materials.

Selling, general and administrative expense increased by $16.3 million and by 1.9 percentage points over the first nine months of fiscal 2014 to 19.9% of sales, reflecting incremental selling, general and administrative expenses from the DAT acquisition of $17.8 million and increased corporate expenses of $16.7 million, partially offset by a decrease in segment selling, general and administrative expense. The ~~projects have payback periods~~increase in corporate expense was mainly due to increased expenses for compliance activities. The decrease in segment selling, general and administrative expense was principally due to the effect of translating selling, general and administrative expenses denominated in non-U.S. functional currencies to the U.S. dollar.

Research, development and engineering spending increased by $3.3 million over the first nine months of fiscal 2014 to 5.5% of sales. The increase in research, development and engineering spending principally reflects incremental research, development and engineering expense from the DAT acquisition of $11.4 million, partially offset by lower spending on Avionics & Controls developments.

During the first nine months of fiscal 2015, we recognized a $15.7 million gain in other income and a $2.4 million reduction in interest expense upon the lapse of a statutory period related to a liability for a non-income tax position of an acquired company. In addition, we incurred a $2.9 million loss in other income on foreign currency exchange resulting from the funding of the acquisition of DAT.

The income tax rate was 19.9% in the first nine months of fiscal 2015 compared to 21.5% in the prior-year period, mainly reflecting additional tax benefits resulting from DAT operating losses.

Earnings from continuing operations in the first nine months of fiscal 2015 were $76.9 million, or $2.44 per diluted share, compared with $114.4 million, or $3.53 per diluted share, in the prior-year period. Loss from discontinued operations in the first nine months of fiscal 2015 was $20.3 million, or $0.64 per diluted share, compared with $8.5 million, or $0.26 per diluted share, in the prior-year period. Net income in the first nine months of fiscal 2015 was $56.6 million, or $1.80 per diluted share, compared with $105.9 million, or $3.27 per diluted share, in the prior-year period.

Cash flows from operating activities were $104.2 million in the first nine months of fiscal 2015 compared with $134.7 million in the prior-year period. The decrease in cash flow from operating activities reflected lower net earnings, partially offset by lower cash payments for interest and income taxes compared to the prior-year period.

Our sales, gross margin and earnings results for the three month and nine month period ended July 31, 2015, compared with the three month and nine month period ended August 1, 2014, included a number of significant items which are summarized in the tables below.

The following is a roll forward of sales and gross margin from the three month period ending August 1, 2014, to the three month period ending July 31, 2015:

In Thousands	Avionics &			Sensors &			Advanced
	Controls			Systems			Materials			Total
Sales:
Three month period ended August 1, 2014	$	192,860		$	192,246		$	121,203		$	506,309
Foreign currency gain (loss)		(1,895	)		(17,985	)		(2,805	)		(22,685	)
Forward contract gain (loss)		(2,756	)		(2,449	)		-			(5,205	)
Acquired DAT business		31,885			-			-			31,885
Sales volume		(12,627	)		3,718			(5,178	)		(14,087	)
Three month period ended July 31, 2015	$	207,467		$	175,530		$	113,220		$	496,217

Gross Margin:
Three month period ended August 1, 2014		71,565			63,619			41,903			177,087
Foreign currency gain (loss)		2,424			(2,732	)		(788	)		(1,096	)
Forward contract gain (loss)		(2,756	)		(2,449	)		-			(5,205	)
Acquired DAT business		15,661			-			-			15,661
Volume/mix		(9,334	)		2,961			(6,667	)		(13,040	)
DAT inventory fair value adjustment		(2,720	)		-			-			(2,720	)
Inventory reserves and EAC adjustment		(878	)		-			-			(878	)
Other		(3,185	)		1,218			1,954			(13	)
Three month period ended July 31, 2015	$	70,777		$	62,617		$	36,402		$	169,796

The following is a roll forward of sales and gross margin from the nine month period ending August 1, 2014, to the nine month period ending July 31, 2015:

In Thousands	Avionics &			Sensors &			Advanced
	Controls			Systems			Materials			Total
Sales:
Nine month period ended August 1, 2014	$	571,366		$	579,131		$	352,613		$	1,503,110
Foreign currency gain (loss)		(1,724	)		(45,350	)		(7,493	)		(54,567	)
Forward contract gain (loss)		(8,684	)		(6,814	)		-			(15,498	)
Acquired DAT business		62,496			-			-			62,496
Sales volume		(28,920	)		(11,356	)		(12,624	)		(52,900	)
Nine month period ended July 31, 2015	$	594,534		$	515,611		$	332,496		$	1,442,641

Gross Margin:
Nine month period ended August 1, 2014		211,935			194,566			120,546			527,047
Foreign currency gain (loss)		6,290			(6,875	)		(2,062	)		(2,647	)
Forward contract gain (loss)		(8,684	)		(6,814	)		-			(15,498	)
Acquired DAT business		24,220			-			-			24,220
Volume/mix		(20,368	)		26			(12,683	)		(33,025	)
DAT inventory fair value adjustment		(5,444	)		-			-			(5,444	)
Inventory reserves and EAC adjustment		(10,167	)		(500	)		-			(10,667	)
Other		(7,011	)		1,438			384			(5,189	)
Nine month period ended July 31, 2015	$	190,771		$	181,841		$	106,185		$	478,797

For further explanation, please see the roll forward table of sales and gross margin at the end of the Overview section.

Three Month Period Ended July 31, 2015, Compared with Three Month Period Ended August 1, 2014

Total sales for the third fiscal quarter decreased by $10.1 million, or 2.0%, over the prior-year period. Sales by segment were as follows:

The $14.6 million, or 7.6%, increase in Avionics & Controls sales over the prior-year period reflected incremental sales from the DAT acquisition of $32 million. This increase was partially offset by the effect of weakening foreign currencies, which reduced segment sales by $2 million compared with the prior-year period. In addition, the settlement of forward foreign currency contracts qualifying under hedge accounting reduced sales by $3 million. Excluding the foreign currency exchange effects and the other items listed in the roll forward, sales volume decreased by $13 million and mainly reflected lower sales of avionics systems for defense applications of $9 million and lower sales of switches and cockpit control devices and military communication systems of $5 million.

The $16.7 million, or 8.7%, decrease in Sensors & Systems sales over the prior-year period reflected the effect of weakening foreign currencies of approximately ~~two years.~~$18 million. Additionally, the impact of forward contracts under hedge accounting reduced sales by $2 million. Excluding the foreign currency exchange effects and the other items listed in the roll forward, sales volume increased $4 million, reflecting higher sales of advanced sensors and power systems, partially offset by lower sales of connection technologies of $3 million due to lower demand from defense and industrial customers, including oil and gas and nuclear.

The $8.0 million, or 6.6%, decrease in Advanced Materials sales over the prior-year period reflected the effect of weakening foreign currencies of $3 million. Excluding the foreign currency exchange effects and the other items listed in the roll forward, sales volume decreased by $5 million, primarily reflecting decreased sales volumes of engineered materials for defense applications of $7 million, partially offset by higher sales volumes of defense technologies for combustible ordnance applications.

Overall, gross margin was 34.2% and 35.0% for the third fiscal quarter of 2015 and 2014, respectively. Gross profit was $169.8 million and $177.1 million for the third fiscal quarter of 2015 and 2014, respectively. Gross margin was impacted by $1.4 million and $2.0 million in restructuring expense in the third fiscal quarter of 2015 and 2014, respectively.

Avionics & Controls segment gross margin was 34.1% and 37.1% for the third fiscal quarter of 2015 and 2014, respectively. Segment gross profit was $70.8 million compared with $71.6 million in the prior-year period. The decrease in gross margin reflected a $5 million decrease on sales of avionics systems and an $8 million decrease on sales of control and communication systems. The decrease in avionics systems gross margin was mainly due to lower sales volumes. Additionally, avionics systems gross margin was impacted by a $0.9 million estimate at completion adjustment due to development program realignments. The decrease in control and communication systems was due to lower sales volumes and mix as well as higher manufacturing costs. These decreases were partially offset by incremental gross profit from the DAT acquisition of $13 million. DAT gross profit included the effect of selling acquired inventory valued at fair value at acquisition. A fair value adjustment of $2.7 million lowered incremental gross profit from DAT from $15.7 million to $13 million.

Sensors & Systems segment gross margin was 35.7% and 33.1% for the third fiscal quarter of 2015 and 2014, respectively. Segment gross profit was $62.6 million compared with $63.6 million in the prior-year period. Gross margin was impacted by the effects of weakening foreign currencies of $3 million and the impact from settlement of forward contracts of $2 million. These decreases were substantially offset by a $4 million increase in gross margin mainly due to improved mix on sales of connection technologies.

Advanced Materials segment gross margin was 32.2% compared with 34.6% for the prior-year period. Segment gross profit was $36.4 million compared with $41.9 million in the prior-year period. The decrease in gross margin reflected lower sales volumes of engineered materials for defense applications and a less favorable sales mix of $7 million, partially offset by lower cost of sales of defense technologies of $3 million.

Selling, general and administrative expenses (which include corporate expenses) totaled $92 million, or 18.5% of sales, and $88.9 million, or 17.6% of sales, for the third fiscal quarter of 2015 and 2014, respectively. The increase in selling, general and administrative expenses reflected incremental selling, general and administrative expenses from the DAT acquisition of $8.9 million. Corporate expenses increased by $7.9 million mainly due to higher compliance costs. These increases were partially offset by the effect of translating selling, general and administrative expenses denominated in non-U.S. functional currencies to the U.S. dollar of approximately $6.8 million and foreign currency gains on monetary assets and forward contracts of $5.7 million.

Research, development and engineering spending was $29.2 million, or 5.9% of sales, for the third fiscal quarter of 2015 compared with $24.3 million, or 4.8% of sales, for the third fiscal quarter of 2014. The increase in research, development and engineering spending principally reflected incremental research, development and engineering from the DAT acquisition of $7.7 million, substantially offset by lower spending on control and communication systems development.

Total restructuring expenses were $2.8 million, or 0.6% of sales, in the third fiscal quarter of 2015, of which $1.4 million is reported separately as restructuring expenses and $1.4 million is included in cost of goods sold. Total restructuring expenses were $5.4 million, or ~~1.0%~~1.1% of sales, in the third fiscal quarter of 2014, of which $3.4 million is reported separately as restructuring expenses and $2.0 million is included in cost of goods sold.

Segment earnings (operating earnings excluding corporate expenses and other income or expense) for the third fiscal quarter of 2015 totaled $71.2 million, or 14.4% of sales, compared with $76.7 million, or 15.1% of sales, for the third fiscal quarter in 2014. Excluding restructuring expenses of $2.8 million and $5.4 million, segment earnings were $74.0 million, or 14.9% of sales, and $82.1 million, or 16.2% of sales, for the third fiscal quarters of 2015 and 2014, respectively.

Avionics & Controls segment earnings were $23.5 million, or 11.3% of sales, in the third fiscal quarter of 2015 and $30.9 million, or 16.0% of sales, in the third fiscal quarter of 2014, mainly reflecting a $3.7 million incremental loss from the DAT acquisition and a $6 million decrease in control and communication systems earnings, partially offset by a $1 million increase on sales of avionics systems. The decrease in earnings from sales of control and communication systems was principally due to lower sales volumes and mix. The $1 million increase in avionics systems earnings reflected a $5 million foreign currency exchange gain on monetary assets and embedded derivatives, substantially offset by a comparable decrease in gross margin. Restructuring expenses were $0.2 million and $1.0 million in the third fiscal quarter of 2015 and 2014, respectively.

Sensors & Systems segment earnings were $23.4 million, or 13.3% of sales, for the third fiscal quarter of 2015 compared with $18.1 million, or 9.4% of sales, for the third fiscal quarter of 2014. Sensors & Systems earnings benefited from lower selling, general and administrative expenses mainly ~~comprised~~due to translating selling, general and administrative expenses denominated in non-U.S. functional currencies to the U.S. dollar. In addition, restructuring expenses were $1.6 million and $3.3 million in the third fiscal quarter of 2015 and 2014, respectively.

Advanced Materials segment earnings were $24.4 million, or 21.5% of sales, for the third fiscal quarter of 2015 compared with $27.7 million, or 22.9% of sales, for the third fiscal quarter of 2014, primarily reflecting lower earnings from sales of engineered materials, partially offset by higher earnings from sales of defense technologies of $3 million. Restructuring expenses were $0.7 million in both the third fiscal quarter of 2015 and 2014. The effect of foreign currencies was not material on segment earnings in the third fiscal quarter of 2015 compared with the prior-year period.

Interest expense for the third fiscal quarter of 2015 was $10.6 million compared with $7.9 million for the third fiscal quarter of 2014, reflecting the refinancing of our credit facility with an interest rate of about 1.7% with the €330.0 million 2023 Notes bearing interest at 3.625%. Subsequent to July 31, 2015, we repaid our $250.0 million 7% 2020 Senior Notes. Given our current debt levels, we expect interest expense to be approximately $30 million in both fiscal year 2015 and 2016.

The income tax rate was 17.4% in the third fiscal quarter of 2015 compared with 23.7% in the prior-year period. In the third fiscal quarter of 2015, we recognized $0.9 million of discrete tax benefits principally related to the following items. The first item was approximately $1.2 million of tax benefits due to the release of reserves upon the expiration of a statute of limitations. The second item was approximately $0.3 million of discrete tax expense principally related to reconciling the prior year’s income tax return to the income tax provision. In the third fiscal quarter of 2014, we recognized $0.2 million of discrete tax expense. The income tax rate differed from the statutory rate in the third fiscal quarter of 2015 and 2014, as both years benefited from various tax credits and certain foreign interest expense deductions.

Nine Month Period Ended July 31, 2015, Compared with Nine Month Period Ended August 1, 2014

For further explanation, please see the roll forward table of sales and gross margin at the end of the Overview section.

Total sales for the first nine months decreased $60.5 million, or 4.0%, over the prior-year period. Sales by segment were as follows:

The $23.2 million, or 4.1%, increase in Avionics & Controls sales over the prior-year period reflected incremental sales of $62 million from the DAT acquisition. This increase was partially offset by a $9 million reduction in sales due to the settlement of forward contracts under hedge accounting. Excluding the foreign currency exchange effects and the other items listed in the roll forward, Avionics & Controls sales volume decreased $29 million. Avionics systems sales volume decreased by $22 million due to lower demand for aviation products for defense applications. Control and communication systems decreased by $4 million, reflecting lower sales of switches and cockpit control devices and military communication systems. Interface technologies sales decreased by $3 million due to lower demand for gaming and medical applications.

The $63.5 million, or 11.0%, decrease in Sensors & Systems sales over the prior-year period reflected the impact of weakening foreign currencies of $45 million and the impact of forward contracts under hedge accounting of $7 million. Excluding the foreign currency exchange effects and the other items listed in the roll forward, sales volume decreased by $11 million, reflecting a $15 million decrease in connection technologies sales mainly due to lower demand from defense and industrial customers including oil and gas. These decreases were offset by a $4 million increase in advanced sensors sales for OEM and aftermarket.

The $20.1 million, or 5.7%, decrease in Advanced Materials sales compared with the prior-year period reflected the impact of weakening foreign currencies of $7 million. Excluding the foreign currency exchange effects and the other items listed in the roll forward, sales volume decreased by $13 million, reflecting a $6 million decrease in defense technologies sales volume mainly due to lower demand for flare countermeasures and a $7 million decrease in sales of engineered materials due to lower demand for defense applications.

Overall, gross margin as a percentage of sales was 33.2% and 35.1% for the first nine months of fiscal 2015 and 2014, respectively. Gross profit was $478.8 million and $527.0 million for the first nine months of fiscal 2015 and 2014, respectively. Gross margin was impacted by $4.8 million and $4.0 million in restructuring expense in the first nine months of ~~exit~~fiscal 2015 and ~~relocation~~2014, respectively.

Avionics & Controls segment gross margin was 32.1% and 37.1% for the first nine months of ~~facilities~~fiscal 2015 and 2014, respectively. Segment gross profit was $190.8 million compared with $211.9 million in the prior-year period. The decrease in gross margin reflected a $25 million decrease on sales of avionics systems and an $11 million decrease on sales of control and communication systems. The decrease in avionics systems gross margin was mainly due to lower sales volumes. Additionally, avionics systems gross profit was impacted by a $1.4 million inventory write-off due to the uncertainty over a specific cockpit integration program and a $7 million estimate-at-completion adjustment due to development program realignments. The decrease in control and communication systems was mainly due to lower sales volumes and mix and higher manufacturing costs. Control and communication systems was further impacted by a $1.8 million inventory write-off due to a program reassessment. These decreases were partially offset by incremental gross profit from the DAT acquisition of $19 million. DAT gross profit included the effect of shipping acquired inventory valued at fair value at acquisition. A fair value adjustment of $5 million lowered incremental gross profit from DAT from $24 million to $19 million.

Sensors & Systems segment gross margin was 35.3% and 33.6% for the first nine months of fiscal 2015 and 2014, respectively. Segment gross profit was $181.8 million compared with $194.6 million in the prior-year period. The decrease in gross margin dollars mainly reflected a $10 million decrease on sales of connection technologies and a $4 million decrease in advanced sensors. The decrease in connection technologies gross margin was principally due to lower sales volumes of $10 million and the effects of weakening foreign currencies of $7 million partially offset by improved sales mix. The decrease in advanced sensors gross margin mainly reflected the effect from the settlement of forward contracts and weakening foreign currencies.

Advanced Materials segment gross margin was 31.9% for the first nine months of fiscal 2015 compared with 34.2% for the same period one year ago. Segment gross profit was $106.2 million compared with $120.5 million in the prior-year period. A $14 million decrease in volume/mix mainly reflected lower sales of engineered materials for defense applications and a lower recovery of fixed costs.

Selling, general and administrative expenses (which include corporate expenses) totaled $286.4 million, or 19.9% of sales, and $270.1 million, or 18.0% of sales, for the first nine months of fiscal 2015 and 2014, respectively. The increase in selling, general and

administrative expense reflected incremental selling, general and administrative expenses from the DAT acquisition of $17.8 million, increased corporate expenses of $16.7 million, partially offset by a decrease in segment selling, general and administrative expense. The increase in corporate expense was mainly due to higher compliance expense, $3.0 million in related acquisition expenses and ~~$1.3~~$3 million in ~~severance.~~higher pension costs due to our settlement with vested terminated pension plan participants. These increases in corporate expense were partially offset by a $4.2 million reduction in incentive compensation. The decrease in segment selling, general and administrative expense reflected the effect of translating selling, general and administrative expenses denominated in non-U.S. functional currencies to the U.S. dollar of $16.8 million and a decrease in segment incentive compensation expense of $2.5 million. These decreases were partially offset by a $2.1 million write-off of fixed assets due to an avionics systems program.

In fiscal 2014, we offered vested terminated participants of our U.S. pension plan a one-time opportunity to elect a lump-sum payment from the plan in lieu of a lifetime annuity. In the first fiscal quarter of 2015, we made $16.6 million in lump-sum payments to vested terminated pension plan participants from the plan, which resulted in an actuarial settlement charge of $3 million.

Total restructuring expenses were $10.1 million, or 0.7% of sales, in the first nine months of fiscal 2015, of which $5.4 million is reported separately as restructuring expenses and $4.7 million is included in cost of goods sold. Total restructuring expenses were $14.3 million, or ~~0.9%~~1.0% of sales, in the first nine months of fiscal 2014, of which $10.3 million is reported separately as restructuring expenses and $4.0 million is included in cost of goods sold. Restructuring expenses were mainly comprised of $4.9 million in severance, $6.9 million in exit and relocation of facilities expenses, and a $2.6 million loss on the write off of certain property, plant and equipment.

On February 4, 2013, we acquired the Gamesman Group (Gamesman) for $40.8 million. Gamesman is a global supplier of input devices principally serving the gaming industry. Gamesman is included in the Avionics & Controls segment.

For the third fiscal quarter of 2014, earnings from continuing operations were $38.9 million, or $1.19 per diluted share, compared to $39.2 million, or $1.23 per diluted share, in the third fiscal quarter of 2013.

For the third fiscal quarter of 2014, sales increased 11.1% to $531.1 million compared to the prior-year period. Gross margin for the third fiscal quarter of 2014 was 34.4% compared with 37.4% in the prior-year period. Gross margin was lower across all three segments. Research, development and engineering spending in the third fiscal quarter of 2014 decreased 0.3 percentage points over the prior-year period to 4.7% of sales. Selling, general and administrative expense, as a percent of sales, in the third fiscal quarter of 2014 decreased 3.4 percentage points over the prior-year period to 17.9% of sales.

During the third fiscal quarter of 2013, we recorded a $3.5 million, or $0.11 per diluted share, impairment charge against goodwill of Racal Acoustics, Ltd. (Racal Acoustics), our military headset business, which is included in our Avionics & Controls segment. The results for the third fiscal quarter of 2013 also were impacted by a $10 million charge, or $0.31 per diluted share, related to the Directorate of Defense Trade Controls (DDTC) matter for which we entered into a Consent Agreement in March 2014.

The income tax rate was 22.7% compared with 2.8% for the third fiscal quarter of 2014 and 2013, respectively. In the third fiscal quarter of 2014, we recognized $0.3 million of discrete income tax benefits and $8.7 million of discrete income tax benefits in the prior-year period.

~~For the third fiscal quarter of 2014, net earnings were $38.9 million, or $1.19 per diluted share, compared to $38.2 million, or $1.20 per diluted share, in the third fiscal quarter of 2013.~~

For the first nine months of fiscal 2014, earnings from continuing operations were $106.2 million, or $3.28 per diluted share, compared to $99.8 million, or $3.15 per diluted share, during the prior-year period.

Sales increased by 9.1% to $1.6 billion in the first nine months of fiscal 2014, reflecting higher Avionics & Controls, Sensors & Systems, and Advanced Materials sales compared with the prior-year period. The increase in Advanced Materials sales reflected higher sales of engineered materials and weaker sales of defense technologies. Our sales were impacted by uncertainty with respect to future defense spending, which has resulted in delays in the release of orders. The impact of this uncertainty is yet to be fully determined, and lack of clarity will likely result in downward pressure for some period of time.

~~Gross margin decreased to 34.4% in the first nine months of fiscal 2014 compared with 36.3% in the prior-year period. This was due to lower gross margins across all three segments.~~

Research, development and engineering spending in the first nine months of fiscal 2014 increased $5.6 million over the prior-year period to $78.4 million, or 5.0% of sales. Selling, general and administrative expense, as a percent of sales, in the first nine months of fiscal 2014 decreased 2.3 percentage points over the prior-year period to 18.5% of sales.

During the first nine months of fiscal 2013, earnings from continuing operations were impacted by a $3.5 million, or $0.11 per diluted share, impairment charge against goodwill of Racal Acoustics, our military headset business. For the first nine months of fiscal 2013, earnings were also impacted by a $10 million charge, or $0.32 per diluted share, related to our matter with the DDTC as referred to above.

The income tax rate was 20.6% and 11.4% for the first nine months of fiscal 2014 and 2013, respectively. In the first nine months of fiscal 2014 and 2013, we recognized $1.4 million and $12.4 million, respectively, in discrete income tax benefits.

~~For the first nine months of fiscal 2014, net earnings were $105.9 million, or $3.27 per diluted share, compared to $98.9 million, or $3.12 per diluted share, during the prior-year period.~~

During the third fiscal quarter of 2014, the U.S. and other countries expanded the sanctions against Russia, which increased the restrictions on sales of certain products, including aviation products, to Russia and to specified restricted parties in or affiliated with Russia. Our Avionics & Controls and Sensors & Systems segments have programs with Russian customers. We evaluated the impact of these sanctions and determined that during the third fiscal quarter of 2014, the impact from Canadian, European Union and U.S. sanctions against Russia on our sales to Russia was not material. We are currently evaluating the effects of these sanctions on our future operating results, but we could have material impacts on our sales to Russia in future periods due to these sanctions.

~~Three Month Period Ended August 1, 2014, Compared with Three Month Period Ended July 26, 2013~~

~~Sales for the third fiscal quarter increased 11.1% over the prior-year period. Sales by segment were as follows:~~

The 11.4% increase in sales of Avionics & Controls mainly reflected higher sales volumes of control and communication systems and interface technologies of $18 million. Control and communication sales increased $11 million due to increased sales of cockpit controls for OEM commercial aviation applications. Interface technologies sales increase was mainly due to higher sales to gaming customers.

The 12.6% increase in Sensors & Systems principally reflected increased sales of connection technologies and $10 million from incremental sales from the Sunbank acquisition in December 2013. Advanced sensors sales increased $2 million on improved OEM sales partially offset by lower aftermarket sales. Power systems sales increased $4 million mainly due to higher commercial aviation demand. Segment sales also benefited from a stronger euro and U.K. pound relative to the U.S. dollar compared with the prior-year period.

The 8.4% increase in sales of Advanced Materials principally reflected increased sales volumes of engineered materials of $11 million, partially offset by decreased sales volumes of defense technologies. The increase in engineered materials mainly reflected higher sales for defense and commercial aviation applications. The decrease in defense technologies sales volumes was due to lower demand for combustible ordnance and flare countermeasure devices.

Overall, gross margin as a percentage of sales was 34.4%, compared with 37.4% in the same period a year ago. Gross profit was $182.5 million compared with $178.9 million in the same period a year ago. Gross margin was impacted by $2.0 million in restructuring expense in the third fiscal quarter of 2014.

Avionics & Controls segment gross margin was 36.8% and 39.4% for the third fiscal quarter of 2014 and 2013, respectively. Segment gross profit was $73.7 million compared with $70.7 million in the prior-year period. The increase in segment gross profit principally reflected higher gross profit on sales of control and communication systems of $5 million, partially offset by a $2 million decrease in gross profit on sales of avionics systems. The increase in gross profit on cockpit control devices was mainly due to higher gross margin on sales of secure communication systems due to a favorable estimate at completion adjustment on a long-term contract. The decrease in the segment gross margin percentage mainly reflected lower gross margins on sales of avionics systems and interface technologies. Avionics systems gross margin was impacted by a $3 million increase in an estimate at completion for long-term contracts for updated flight management systems, and interface technologies gross margin was impacted by an unfavorable sales mix.

Sensors & Systems segment gross margin was 33.0% and 36.4% for the third fiscal quarter of 2014 and 2013, respectively. Segment gross profit was $65.4 million compared with $64.0 million in the prior-year period. The decrease in the segment gross margin percentage reflected lower aftermarket sales of advanced sensors and higher operating expenses at our advanced sensors operations. Additionally, connection technologies gross margin was impacted by lower connector sales for defense applications.

Advanced Materials segment gross margin for the third fiscal quarter of 2014 was 32.6% compared with 36.1% for the prior-year period. Segment gross profit was $43.4 million compared with $44.2 million in the prior-year period. Gross profit in the third fiscal quarter of 2014 compared to the prior-year period reflected higher sales volumes of engineered materials for defense applications, offset by lower gross profit on decreased sales volumes of combustible ordnance and flare countermeasure devices. Gross margin

~~declined in the third fiscal quarter of 2014 due to lower sales of combustible ordnance and lower yields on flare countermeasure devices.~~

Selling, general and administrative expenses (which include corporate expenses) totaled $95.3 million, or 17.9% of sales, and $101.8 million, or 21.3% of sales, for the third fiscal quarter of 2014 and 2013, respectively. The decrease mainly reflected the $10 million charge for the DDTC matter recorded in the prior-year period, partially offset by $2 million in incremental compliance expense in the third fiscal quarter of 2014.

Research, development and engineering spending was ~~$25.1~~$78.7 million, or ~~4.7% of sales, for the third fiscal quarter of 2014 compared with $24.1 million, or 5.0% of sales, for the third fiscal quarter of 2013.~~

Segment earnings (operating earnings excluding corporate expenses and other income or expense) for the third fiscal quarter of 2014 totaled $74.8 million, or 14.1% of sales, compared with $70.3 million, or 14.7% of sales, for the third fiscal quarter in 2013. Excluding restructuring expenses of $5.1 million, segment earnings were $79.9 million, or 15.0% of sales, for the third fiscal quarter of 2014. In the third fiscal quarter of 2013, we recorded an impairment charge of $3.5 million against goodwill of Racal Acoustics. Excluding the impairment charge recorded, segment earnings totaled $73.8 million, or 15.4% of sales, for the third fiscal quarter of 2013.

Avionics & Controls segment earnings were $29.1 million, or 14.5% of sales, in the third fiscal quarter of 2014 compared with $20.6 million, or 11.5% of sales, in the third fiscal quarter of 2013, mainly reflecting an $11 million increase in control and communication systems, partially offset by a $3 million decrease in avionics systems. Control and communication systems earnings benefited from increased earnings on higher sales and margins of cockpit control devices and improved earnings from sales of secure communication devices. Additionally, the third fiscal quarter of 2013 reflected an impairment charge of $3.5 million against goodwill of Racal Acoustics. Excluding the impairment charge, Avionics & Controls segment earnings were $24.1 million, or 13.4% of sales, in the third fiscal quarter of 2013. Avionics systems earnings were impacted by an unfavorable estimate at completion adjustment.

Sensors & Systems segment earnings were $18.2 million, or 9.2% of sales, for the third fiscal quarter of 2014 compared with $21.6 million, or 12.3% of sales, for the third fiscal quarter of 2013. Sensors & Systems earnings were impacted by $3.3 million in restructuring expense and by lower aftermarket sales of engine sensors.

Advanced Materials segment earnings were $27.5 million, or 20.7% of sales, for the third fiscal quarter of 2014 compared with $28.1 million, or 22.9% of sales, for the third fiscal quarter of 2013, primarily reflecting lower earnings from sales of flare countermeasures of $5 million. This decrease in segment earnings from lower sales of countermeasures was substantially offset by increased earnings on higher sales of elastomer materials for defense applications.

~~Interest expense for the third fiscal quarter of 2014 was $7.9 million compared with $9.1 million for the third fiscal quarter of 2013, reflecting reduced borrowings.~~

The income tax rate was 22.7% for the third fiscal quarter of 2014 compared with 2.8% for the third fiscal quarter of 2013. In the third fiscal quarter of 2014, we recognized $0.3 million of discrete income tax benefits. In the third fiscal quarter of 2013, we recognized $8.7 million of discrete tax benefits principally related to the following items. The first item was a $4.3 million income tax benefit related to the release of income tax reserves due to the expiration of applicable statutes of limitations. The second item was a $3.8 million reduction of net deferred income tax liabilities as a result of the enactment of tax laws reducing the U.K. statutory income tax rate. The income tax rate differed from the statutory rate in the third fiscal quarter of 2014 and 2013, as both quarters benefited from various tax credits and certain foreign interest expense deductions.

~~To the extent that sales are transacted in a currency other than the functional currency of the operating unit, we are subject to foreign currency fluctuation risk.~~

We use forward contracts to hedge our foreign currency exchange risk. To the extent that these contracts qualify as hedges under U.S. GAAP, the amount of gain or loss is deferred in Accumulated Other Comprehensive Income (AOCI) until the related sale occurs. Also, we are subject to foreign currency gains or losses from embedded derivatives on backlog denominated in a currency other than the functional currency of our operating companies or its customers. Gains and losses on forward contracts, embedded derivatives, and revaluation of assets and liabilities denominated in a currency other than the functional currency of the Company for the three-month periods ended August 1, 2014, and July 26, 2013, are as follows:

~~Nine Month Period Ended August 1, 2014, Compared with Nine Month Period Ended July 26, 2013~~

Sales for the first nine months of fiscal 2014 increased by 9.1% over the prior-year period, reflecting 40 weeks in the first nine months in fiscal 2014 and 39 weeks in the prior-year period and incremental sales from the Sunbank acquisition. Sales by segment were as follows:

The 9.1% increase in sales of Avionics & Controls mainly reflected increased sales volumes of control and communication systems and interface technologies. A $28 million increase in interface technologies sales mainly reflected incremental sales from the Gamesman acquisition. A $16 million increase in control and communication systems sales mainly reflected increased sales volumes of control panels and switches of $13 million for OEM commercial aviation applications. Additionally, the increase reflected higher sales volumes of secure communication devices of $7 million. These increases were partially offset by lower sales volumes of controls and grips.

The 13.6% increase in sales of Sensors & Systems principally reflected increased sales of connection technologies of $49 million and power systems of $14 million. The increase in connection technologies reflected incremental sales from the Sunbank acquisition of $23 million and higher sales volumes of connection technologies for commercial aviation and industrial applications. The increase in power systems sales mainly reflected higher OEM sales for commercial aviation applications. Advanced sensors sales increased $8 million on improved OEM sales partially offset by lower aftermarket sales. Segment sales also benefited from a stronger euro and U.K. pound relative to the U.S. dollar compared with the prior-year period.

The 2.4% increase in sales of Advanced Materials principally reflected increased sales of engineered materials for defense and commercial aviation applications of $27 million, partially offset by lower sales volumes of defense technologies of $18 million.

Overall, gross margin as a percentage of sales was 34.4% and 36.3% for the first nine months of fiscal 2014 and 2013, respectively. Gross profit was $538.1 million and $520.6 million for the first nine months of fiscal of 2014 and 2013, respectively. Gross margin was impacted by $4.0 million in restructuring expense in the first nine months of fiscal 2014.

Avionics & Controls segment gross margin was 36.6% and 37.6% for the first nine months of fiscal 2014 and 2013, respectively. Segment gross profit was $218.0 million compared with $205.4 million in the prior-year period, reflecting a $14 million increase on gross profit from sales of avionics systems and interface technologies. Gross profit on avionics systems increased $8 million mainly due to higher sales of aviation products for defense applications, partially offset by $2 million in restructuring expense. Gross profit on interface technologies increased $6 million mainly due to incremental sales from the Gamesman acquisition. The decrease in segment gross margin mainly reflected lower gross margin on sales of control and communication systems due to lower spares sales.

Sensors & Systems segment gross margin was 33.5% and 37.0% for the first nine months of fiscal 2014 and 2013, respectively. Segment gross profit was $199.4 million compared with $194.3 million in the prior-year period. The increase in gross profit mainly reflected the favorable effect of a strong euro and U.K. pound relative to the U.S. dollar. The decrease in segment gross margin principally reflected lower margins on sales of connection technologies and advanced sensors. The decrease in gross margin on connection technologies was due to lower defense sales resulting in a lower recovery of fixed overhead expenses. In addition, connection technologies gross margin was impacted by Sunbank’s current gross margin being lower than segment gross margin and

~~by recording Sunbank’s acquired inventory at fair value. The decrease in advanced sensors gross margin reflected lower aftermarket sales and higher operating expenses.~~

Advanced Materials segment gross margin was 32.3% for the first nine months of fiscal 2014 compared to 33.2% for the same period one year ago. Segment gross profit was $120.8 million compared to $121.0 million in the prior-year period. The decrease in segment gross profit reflected a decrease in gross profit on sales of defense technologies due to lower sales of combustible ordnance and flare countermeasures partially offset by a $15 million increase in gross profit on higher sales of elastomer materials for commercial aviation and defense applications.

~~Selling, general and administrative expenses (which include corporate expenses) totaled $290.0 million, or 18.5% of sales, and $298.7 million, or 20.8%~~5.5% of sales, for the first nine months of fiscal 2014 and 2013, respectively. The $8.7 million decrease in selling, general and administrative expenses mainly reflects a $4.8 million decrease in corporate expense and a $3.7 million decrease in segment selling, general and administrative expense. The decrease in corporate expense reflects the recording of a $10 million charge for the DDTC matter in the prior-year period. This decrease was partially offset by a $2.6 million increase in compliance expense related to U.S. export laws in the first nine months of fiscal 20142015 compared to the prior-year period. The decrease in segment selling, general and administrative expense mainly reflected a $6.8 million decrease in pension expense, partially offset by incremental selling, general and administrative expense from acquisitions of businesses.

~~Research, development and engineering spending was $78.4~~with $75.4 million, or 5.0% of sales, for the first nine months of fiscal ~~2014 compared with $72.8 million, or 5.1% of sales, for the first nine months of fiscal 2013.~~2014. The increase in research, development and engineering spending ~~principally~~ reflects ~~higher~~incremental research, development and engineering expense from the DAT acquisition of $11.4 million, partially offset by lower spending on ~~avionics~~control and communication systems ~~and advanced sensors.~~developments. Fiscal ~~2014~~2015 research, development and engineering spending is expected to be ~~about 5%~~in the range of approximately 5.5% of sales.

~~Total segment~~Segment earnings (operating earnings excluding corporate expenses and other income or expense) for the first nine months of fiscal ~~2014~~2015 totaled ~~$207.8~~$173.4 million, or ~~13.3%~~12.0% of sales, compared with ~~$198.8~~$219.7 million, or ~~13.9%~~14.6% of sales, for the first nine months in fiscal 2014. Excluding restructuring expenses of $10.1 million, segment earnings were $183.5 million, or 12.7% of sales, for the first nine months of ~~fiscal 2013.~~2015. Excluding restructuring expenses of ~~$13.8~~$14.3 million, segment earnings were ~~$221.7~~$234.0 million, or ~~14.2%~~15.6% of sales, for the first nine months of 2014.

Avionics & Controls segment earnings were ~~$75.4~~$52.0 million, or ~~12.6%~~8.8% of sales, in the first nine months of fiscal 2015 and $82.0 million, or 14.3% of sales, in the first nine months of fiscal 2014, mainly reflecting a $15 million decrease in avionics systems, a $10 million incremental loss from the DAT acquisition, and ~~$60.7~~a $4 million ~~or 11.1%~~decrease in control and communication systems earnings. The decrease in avionics systems earnings mainly reflected lower gross margin as explained above, partially offset by a $9 million decrease in selling, general and administrative expense. The decrease in avionics systems selling, general and administrative expense was mainly due to gains on monetary assets and embedded derivatives of $5 million and a decrease in restructuring expense. The decrease in earnings from sales of control and communication systems principally reflected lower sales volumes and unfavorable product mix, partially offset by lower research, engineering and development expense and selling, general and administrative expenses. Segment restructuring expenses were $0.6 million and $4.4 million in the first nine months of fiscal ~~2013. Excluding restructuring expense, segment earnings were $79.8~~2015 and 2014, respectively. The effect of foreign currencies and forward contracts had a favorable $4 million ~~or 13.4% of sales. Excluding the goodwill impairment charge of $3.5 million associated with Racal Acoustics, segment earnings were $64.1 million, or 11.7% of sales,~~impact in the first nine months of fiscal ~~2013. The increase in segment earnings from~~2015 compared with the prior-year period ~~mainly reflects a $5 million increase in avionics systems earnings, a $6 million increase in control~~ and ~~communication systems earnings,~~was principally due to gains on monetary assets and a $4 million increase in interface technologies earnings. Avionics systems earnings benefited from increased gross profit, partially offset by higher research, development and engineering expense of $4 million. Control and communication systems benefited from lower operating expenses. The increase in interface technologies earnings reflected incremental earnings from the Gamesman acquisition.

Sensors & Systems segment earnings were ~~$61.5~~$55.5 million, or ~~10.3%~~10.8% of sales, for the first nine months of fiscal 2015 compared with $61.8 million, or 10.7% of sales, for the first nine months of fiscal 2014. The decrease in segment earnings principally reflected a $4 million decrease in earnings from sales of connection technologies and a $1 million decrease in advanced sensors. The decrease in both connection technologies and advanced sensors earnings was due to the decrease in gross margin as described above, partially offset by lower selling, general and administrative expense mainly due to the effects of weakening foreign currencies. Additionally, segment restructuring expenses were $6.1 million and $5.5 million in the first nine months of fiscal 2015 and 2014, respectively.

Advanced Materials segment earnings were $65.9 million, or 19.8% of sales, for the first nine months of fiscal 2015 compared with $75.9 million, or 21.5% of sales, for the first nine months of fiscal 2014, ~~compared with $63.8~~primarily reflecting lower earnings from sales of engineered materials. Earnings from sales of defense technologies improved mainly due to lower restructuring expense. Segment restructuring expense was $2.5 million ~~or 12.2% of sales, for~~and $3.9 million in the first nine months of fiscal ~~2013. Sensors & Systems was impacted by lower earnings on sales of advanced sensors, $5.5 million in segment restructuring expense,~~2015 and ~~$1.4 million from recording Sunbank’s acquired inventory at its fair value. These decreases were partially offset by higher earnings on sales of power systems.~~

~~Advanced Materials segment earnings were $70.9 million, or 19.0% of sales, for the first nine months of fiscal~~ 2014, compared with $74.4 million, or 20.4% of sales, for the first nine months of fiscal 2013, primarily reflecting restructuring expense of $4 million and lower earnings from sales of combustible ordnance and countermeasures. The restructuring expense mainly reflected a loss from the write off of certain property, plant and equipment resulting from a planned facility closure. This decrease in segment earnings was partially offset by increased gross profit on higher sales of elastomer materials for commercial aviation and defense applications.

Interest expense for the first nine months of fiscal ~~2014~~2015 was ~~$24.9~~$25.0 million compared with ~~$31.0~~$24.9 million for the first nine months of fiscal ~~2013, reflecting reduced borrowings.~~2014.

The income tax rates were ~~20.6%~~19.9% and ~~11.4%~~21.5% for the first nine months of fiscal ~~2014~~2015 and ~~2013,~~2014, respectively. In the first nine months of ~~2014,~~2015, we recognized ~~approximately $1.4~~$0.1 million of discrete tax benefits principally related to the following items. The first item was approximately ~~$0.9~~$1.5 million of discrete tax benefits due to the retroactive extension of the U.S. federal research and experimentation credits. The second item was approximately $1.2 million of tax benefits due to the release of reserves upon the expiration of a statute

of limitations. The third item was approximately $2.6 million of discrete tax expense principally related to reconciling the prior-year’s income tax return to the income tax provision. In the first nine months of fiscal 2014, we recognized approximately $0.9 million of discrete tax benefits principally related to the following items. The first item was approximately $0.7 million of tax benefits due to the release of reserves upon the expiration of ~~applicable statutes~~a statute of limitations. The second item was a $0.5 million reduction of net deferred income tax liabilities as a result of the enactment of tax laws reducing the U.K. statutory income tax rate. ~~In the first nine months of fiscal 2013, we recognized $12.4~~The third item was approximately $0.3 million of discrete tax ~~benefits~~expense principally related to reconciling the ~~following items. The first item was approximately $1.5 million of~~prior year’s income tax ~~benefits due~~return to the retroactive extension of the U.S. federal research and experimentation credits. The second item was approximately $2.3 million of tax benefits related to the settlement of U.S. and foreign tax examinations. The third item was a $4.3 million tax benefit related to the release of

~~tax reserves due to the expiration of applicable statutes of limitations. The fourth item was a $3.8 million reduction of net deferred~~ income tax ~~liabilities as a result of the enactment of tax laws reducing the U.K. statutory income tax rate.~~provision. The income tax rate differed from the statutory rate in the first nine months of fiscal ~~2014~~2015 and ~~2013,~~2014, as both years benefited from various tax credits and certain foreign interest expense deductions.

To the extent that sales are transacted in a currency other than the functional currency of the operating unit, we are subject to foreign currency fluctuation risk.

We use forward contracts to hedge our foreign currency exchange risk. To the extent that these contracts qualify as hedges under U.S. GAAP, the amount of gain or loss is deferred in Accumulated Other Comprehensive Income (AOCI) until the related sale occurs. Also, we are subject to foreign currency gains or losses from embedded derivatives on backlog denominated in a currency other than the functional currency of our operating companies or its customers. Gains and losses on forward contracts, embedded derivatives, and revaluation of assets and liabilities denominated in a currency other than the functional currency of the Company for the nine month periods ended August 1, 2014, and July 26, 2013, are as follows:

New orders for the first nine months of fiscal ~~2014~~2015 were $1.6 billion compared with ~~$1.4~~$1.5 billion for the same period in ~~2013.~~2014. New orders for the first nine months of fiscal 2015 include the acquired backlog of DAT of $204.0 million. Backlog was $1.3 billion at July 31, 2015, $1.3 billion at August 1, 2014, and $1.1 billion at ~~the end of the prior-year period and at the end of fiscal 2013.~~October 31, 2014.

Cash and cash equivalents at ~~August 1, 2014,~~July 31, 2015, totaled ~~$210.5~~$187.7 million, ~~an increase~~a decrease of ~~$31.3~~$50.5 million from October ~~25, 2013.~~31, 2014. Net working capital ~~increased~~decreased to ~~$772.9~~$743.0 million at ~~August 1, 2014,~~July 31, 2015, from ~~$683.6~~$761.4 million at October ~~25, 2013.~~31, 2014. Sources and uses of cash flows from operating activities principally ~~consist~~consisted of cash received from the sale of products and cash payments for material, labor and operating expenses. Cash flows provided by operating activities were ~~$134.7~~$104.2 million and ~~$196.3~~$134.7 million in the first nine months of fiscal 2015 and 2014, ~~and 2013, respectively, reflecting higher purchases of inventory,~~respectively. The decrease in cash flow from operating activities reflected lower net earnings partially offset by lower cash ~~collections from customers and higher~~ payments for interest and income ~~taxes.~~taxes compared with the prior-year period.

Cash flows used by investing activities were ~~$79.8~~$176.8 million and ~~$77.5~~$79.8 million in the first nine months of fiscal 2015 and 2014, ~~and 2013,~~ respectively. Cash flows used for investing activities for the first nine months of fiscal 2014 primarily reflected cash paid for acquisitions of $44.7 million, net of cash acquired, and capital expenditures of $35.0 million. Cash flows used by investing activities in the first nine months of fiscal ~~2013 primarily~~2015 mainly reflected capital expenditures of $37.8 million and cash paid for acquisitions of $171.1 million, partially offset by proceeds from the sales of discontinued operations. Cash flows used by investing activities in the first nine months of fiscal 2014 mainly reflected cash paid for acquisitions of ~~$40.7~~$44.7 million ~~net of cash acquired,~~ and capital expenditures of ~~$37.8~~$35.0 million.

Cash flows provided by financing activities were $40.1 million in the first nine months of fiscal 2015 and mainly reflected $335 million in proceeds from our credit facilities, $356.5 million in proceeds from issuance of the 2023 Notes, and $13.5 million from the issuance of common stock under our employee stock plans, partially offset by $259.5 million in shares repurchased, $402.1 million in debt repayment, and $8.2 million of debt issuance costs. Cash flows used by financing activities were $22.1 ~~million and $78.2~~ million in the first nine months of fiscal 2014 and ~~2013, respectively. Cash flows used by financing activities in the first nine months~~mainly reflected $40.0 million repayment of ~~fiscal 2014 primarily reflected shares repurchased of $5.2~~long-term credit facilities, $34.1 million repayment of long-term debt, ~~and credit facilities of $74.1~~partially offset by $25.0 million ~~and~~in proceeds from our credit ~~facility of $25 million. Cash flows used by financing activities in~~facilities and $23.2 million from the ~~first nine months of fiscal 2013 primarily reflected proceeds from our new credit facility of $175.0 million and repayment of long-term debt and credit facilities of $279.5 million.~~

~~On June 19, 2014, our board of directors approved a $200 million share repurchase program. Under the program, we are authorized to repurchase up to $200 million of outstanding shares~~issuance of common stock from time to time, depending on market conditions, share price and other factors. Repurchases may be made in the open market or through private transactions, in accordance with SEC requirements. We may enter into a Rule 10(b)5-1 plan designed to facilitate the repurchase of all or a portion of the repurchase amount. The program does not require the Company to acquire a specific number of shares. During the three months ended August 1, 2014, we repurchased 45,979 shares under ~~this program at an average price paid per share of $112.57, for an aggregate purchase price of $5.2 million.~~

~~We believe cash on hand and funds generated from operations are adequate to service operating cash requirements and capital expenditures through the next twelve months.~~our employee stock plans.

Capital expenditures, consisting of machinery, equipment and computers, are anticipated to be approximately ~~$60~~$50 million during fiscal ~~2014,~~2015, compared ~~to $55.3~~with $45.7 million expended in fiscal ~~2013~~2014 (excluding acquisitions).

Total debt at ~~August 1, 2014,~~July 31, 2015, was ~~$640.9~~$913.8 million and consisted of $250.0 million of 2020 Notes, ~~$164.1~~$362.5 million (€330.0 million) of ~~the U.S. Term Loan, $115.0~~2023 Notes, $200.0 million in borrowings under our secured credit facility, ~~$52.9~~$43.2 million ofin government refundable advances, ~~$55.8~~$58.0 million under capital lease obligations, and ~~$3.1~~$0.1 million ofunder our various foreign currency debt agreements and other debt agreements.

We believe cash on hand and funds generated from operations and borrowing capacity available under our debt facilities are sufficient to fund operating cash requirements and capital expenditures through the next twelve months.

This quarterly report on Form 10-Q contains forward-looking statements. These statements relate to future events or our future financial performance. In some cases you can identify forward-looking statements by terminology such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “potential,” “predict,” “should” or “will” or the negative of such terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risk factors set forth in “Forward-Looking Statements” and “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended October ~~25, 2013,~~31, 2014, that may cause our or the industry’s actual results, performance or

achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. You should not place undue reliance on these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, performance or achievements. Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements included or incorporated by reference into this report are made only as of the date hereof. We do not undertake and specifically decline any obligation to update any such statements or to publicly announce the results of any revisions to any such statements to reflect future events or ~~developments, except as required by law.~~developments.

There have been no significant changes in our exposure to market risk during the first nine months of fiscal ~~2014.~~2015. A discussion of our exposure to market risk is provided in the Company’s Annual Report on Form 10-K for the fiscal year ended October ~~25, 2013.~~31, 2014.

Our principal executive and financial officers evaluated our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of ~~August 1, 2014.~~July 31, 2015. Based upon that evaluation, they concluded as of ~~August 1, 2014,~~July 31, 2015, that our disclosure controls and procedures were effective to ensure that information we are required to disclose in the reports that we file under the Exchange Act is recorded, processed, summarized and reported within time periods specified in Securities and Exchange Commission rules and forms. In addition, our principal executive and financial officers concluded as of ~~August 1, 2014,~~July 31, 2015, that our disclosure controls and procedures ~~were~~are also effective to ensure that information required to be disclosed in reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including to our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

During the time period covered by this report, there were no changes in our internal control over financial reporting that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

From time to time we are involved in legal proceedings arising in the ordinary course of business. We believe that adequate reserves for these liabilities have been made and that there is no litigation pending that could have a material adverse effect on our results of operations and financial condition.

See Note 9 to the ~~consolidated financial statements~~Consolidated Financial Statements included in Part 1, Item 1 of this report for information regarding legal proceedings.

Total Number of

Dollar Value

of Shares

of Shares

Purchased as

That May Yet

Total Number

Part of Publicly

Be Purchased

of Shares

Average Price

Announced Plans

Under the Plan

Period

Repurchased

Paid Per Share

or Programs

or Program

May 3, 2014 to May 30, 2014

-

$
-

-

$
-

May 31, 2014 to June 27, 2014

-

-

-

200,000,000

June 28, 2014 to August 1, 2014

45,979

112.57

45,979

194,824,183

Total

45,979

45,979

					Total Number of		Dollar Value
					Shares Purchased		of Shares
					as Part of		That May Yet
	Total Number		Average		Publicly		Be Purchased
	of Shares		Price Paid		Announced Plans		Under the Plans
Period	Repurchased		Per Share		or Programs		or Programs

May 2, 2015 to May 29, 2015		66,136	$	111.01		66,136	$	235,054,745
May 30, 2015 to June 26, 2015		431,431		94.43		431,431		194,313,700
June 27, 2015 to July 31, 2015		902,119		93.22		902,119		110,220,553
Total		1,399,686				1,399,686

On June 19, 2014, our board of directors authorized a ~~new~~ share repurchase program for the repurchase of up to an aggregate of $200 million of the Company’s outstanding common stock. On March 11, 2015, our board of directors authorized an additional $200 million for the repurchase of the Company’s outstanding common stock. All of the repurchases in the table above were made through that program.

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Delaware		13-2595091
(State or other Jurisdiction		(I.R.S. Employer
of incorporation or organization)		Identification No.)

Large accelerated filer	þ	Accelerated filer	¨

Non-accelerated filer	¨ (Do not check if a smaller reporting company)	Smaller reporting company	¨

In Thousands	July 31,			October 31,
	2015			2014

Unrealized gain (loss) on derivative contracts	$	(27,050	)	$	(14,179	)
Tax effect		7,317			3,890
		(19,733	)		(10,289	)

Pension and post-retirement obligations		(77,644	)		(90,225	)
Tax effect		25,941			30,072
		(51,703	)		(60,153	)

Currency translation adjustment		(224,399	)		(61,135	)
Accumulated other comprehensive gain (loss)	$	(295,835	)	$	(131,577	)

In Thousands
As of January 31, 2015

Current assets	$	94,899
Property, plant and equipment		6,211
Intangible assets subject to amortization
Programs (15 year average useful life)		56,513
Programs (3 year average useful life)		677
Trade name (3 year average useful life)		226
Goodwill		48,001
Other assets		3,401
Total assets acquired		209,928

Current liabilities assumed		33,492
Long-term liabilities assumed		5,366
Net assets acquired	$	171,070

In Thousands	Avionics &			Sensors &		Advanced
	Controls			Systems		Materials			Other			Total

Net Sales	$	4,436		$	6,419	$	5,424		$	-		$	16,279

Operating earnings (loss)		(1,132	)		1,533		(830	)		(803	)		(1,232	)
Gain (loss) on net assets held for sale		(1,718	)		619		(18	)		-			(1,117	)
Tax expense (benefit)		(695	)		428		(127	)		(262	)		(656	)
Income (loss) from discontinued operations	$	(2,155	)	$	1,724	$	(721	)	$	(541	)	$	(1,693	)

			Three Months Ended
	Increase (Decrease)		July 31,		August 1,
In Thousands	From Prior Year		2015		2014

Avionics & Controls		7.6%	$	207,467	$	192,860
Sensors & Systems	(8.7)%			175,530		192,246
Advanced Materials	(6.6)%			113,220		121,203
Total Net Sales			$	496,217	$	506,309

(In thousands)			Three Months Ended
	Incr. (Decr.) From		August 1,		July 26,
	Prior Year Period		2014		2013
Avionics & Controls		11.4%	$	200,109	$	179,572
Sensors & Systems		12.6%		198,106		175,864
Advanced Materials		8.4%		132,909		122,632
Total Net Sales			$	531,124	$	478,068

~~Item 6.~~		~~Exhibits~~Exhibit
Number		Exhibit Index

~~3.1~~10.1	*	~~Amended and Restated Bylaws of~~Offer Letter from Esterline Technologies Corporation ~~effective June 5, 2014.~~to Roger Ross dated July 27, 2015. (Incorporated by reference to Exhibit ~~3.1~~10.1 to the ~~Company’s~~Company's Current Report on Form 8-K ~~dated June 5, 2014~~filed on August 13, 2015 [Commission File ~~No. 1-63571]~~Number 1-6357].)

~~10.1~~10.2	*	~~Fifth Amendment dated as of June 9, 2014, among~~Retirement Transition Agreement and Release between Esterline Technologies Corporation and Frank Houston effective August 14, 2015. (Incorporated by reference to Exhibit 10.2 to the ~~Guarantors, Wells Fargo Bank, National Association, as Administrative Agent, and the lenders and other parties thereto.~~Company's Current Report on Form 8-K filed on August 13, 2015 [Commission File Number 1-6357].)

10.3	*	Transition Agreement and Release between Esterline Technologies Corporation and Alain Durand effective August 14, 2015. (Incorporated by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed on August 13, 2015 [Commission File Number 1-6357].)
11
11		Schedule setting forth computation of basic and diluted earnings per ~~common~~ share for the three and nine month periods ended July 31, 2015, and August 1, ~~2014, and July 26, 2013.~~2014.

31.1		Certification of Chief Executive Officer.

31.2		Certification of Chief Financial Officer.

32.1		Certification (of Curtis C. Reusser) pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification (of Robert D. George) pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS		XBRL Instance Document

~~Item 6.~~		~~Exhibits~~

101.SCH		XBRL Taxonomy Extension Schema

101.CAL		XBRL Taxonomy Extension Calculation Linkbase

101.DEF		XBRL Taxonomy Extension Definition Linkbase

101.LAB		XBRL Taxonomy Extension Label Linkbase

101.PRE		XBRL Taxonomy Extension Presentation Linkbase

Dated: September ~~5, 2014~~4, 2015	By:	/s/ Robert D. George
		Robert D. George
		Chief Financial Officer, Vice President, and
		Corporate Development
		(Principal Financial Officer)