Esterline Technologies 8-K Esterline 3Q Earnings from Continuing Operations

FOR IMMEDIATE RELEASE

Contact: Brian Keogh 425-453-9400

ESTERLINE 3Q EARNINGS FROM CONTINUING OPERATIONS

$32.5 MILLION – $1.09 PER SHARE – ON $361.5 MILLION SALES

Third Quarter Tax Benefit Contributes About $.10 Per Share

BELLEVUE, Wash., September 3, 2009 — Esterline Corporation, (NYSE: ESL www.esterline.com), a leading specialty manufacturer serving aerospace/defense markets, today reported fiscal 2009 third quarter (ended July 31) income from continuing operations of $32.5 million, or $1.09 per diluted share, on sales of $361.5 million. Earnings include a tax benefit of approximately $.10 per share. Year-ago income from continuing operations was $18.4 million, or $.61 per diluted share, on sales of $363.5 million.

Robert W. Cremin, Esterline CEO, said, “…Esterline posted a very solid quarter, keeping us on pace with our full-year guidance despite continued uncertainty in the commercial airline industry.” Esterline’s full-year earnings guidance now stands at $3.10 to $3.30 per share, reflecting the third quarter tax benefit.

Cremin said, “...we feel good going into our fourth quarter, though our guidance range reflects some caution.” He said commercial aviation spares sales appear to have bottomed as customers work to balance inventory levels, but he noted that “...these sales can be difficult to forecast accurately due to short lead times.” The extent of the business jet market decline also continues to affect the performance of certain operations, especially in the company’s Sensors & Systems segment.

Cremin reiterated comments he made last quarter regarding the timing of military countermeasure flares shipments. He said, “...the scarcity of specialized ships for transporting foreign orders of these products continues to be an issue. We know the orders will ship; we just aren’t certain at this point if they’ll ship in fiscal 2009 or push into 2010.”

Gross margin improved in the quarter as a percentage of sales to 32.4%, compared to 31.2% in the same period a year ago. Cremin said the margin increase was due “…primarily to improved performance in our Avionics & Controls segment.”

He said, “…we continue to focus on operational excellence—making appropriate adjustments to individual business circumstances.” He noted that the company has continued to tighten SG&A (selling, general and administrative) expenses. He also said that R&D spending “…is coming down to our more normalized level of 4.5%, following the ramp-up over the last several years to win positions on significant new programs, such as the JSF, 787 and T-6B.”

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Page 2 of 4 Esterline Reports Third Quarter 2009

“Investing in the future remains a cornerstone of our strategy,” he said, adding that Esterline “…recently stepped up to partner with Rolls-Royce to develop the sensors for its new Trent XWB engine for the Airbus A350.” He said, “…we’re also in the midst of several important plant expansions to prepare for the growth we anticipate as new programs come on-line and economic conditions improve.”

The effective income tax rate for the third quarter of 2009 was 8.5% including a reversal of prior expenses related to the application of certain foreign tax laws, and a tax benefit associated with the reconciliation of the prior year’s tax returns. The tax rate excluding these two events was 17.5%. Last year’s effective income tax rate was 25.3%.

Income from discontinued operations in the third quarter of 2009 was less than $.01 per diluted share, compared with $.07 per diluted share in the prior-year period. Net income was $32.6 million, or $1.09 per diluted share, compared with $20.5 million, or $.68 per diluted share, in the prior-year period.

For the first nine months of fiscal 2009, Esterline reported net earnings from continuing operations of $69.3 million, or $2.32 per diluted share, on sales of $1.03 billion. This compared with net earnings from continuing operations of $72.1 million, or $2.41 per diluted share, on $1.08 billion in sales for the same period in 2008. Income from discontinued operations in the first nine months of 2009 was $.54 per diluted share, compared with $.15 per diluted share in the prior-year period. Net income was $85.3 million, or $2.86 per diluted share, compared with $76.7 million, or $2.56 per diluted share, in the prior-year period.

New orders for the first nine months of 2009 were $1.01 billion compared with $1.15 billion for the same period in 2008. Backlog was $1.07 billion compared with $1.02 billion at the end of the prior-year period and $1.1 billion at the end of fiscal 2008.

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. 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 forward-looking statements are only predictions based on the current intent and expectations of the management of Esterline, are not guarantees of future performance or actions, and involve risks and uncertainties that are difficult to predict and may cause Esterline’s or its industry’s actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Esterline’s actual results and the timing and outcome of events may differ materially from those expressed in or implied by the forward-looking statements due to risks detailed in Esterline’s public filings with the Securities and Exchange Commission including its most recent Annual Report on Form 10-K

Page 3 of 4 Esterline Reports Third Quarter 2009

ESTERLINE TECHNOLOGIES CORPORATION

Consolidated Statement of Operations (unaudited)

In thousands, except per share amounts

	Three months ended						Nine months ended
	July 31, 2009			August 1, 2008			July 31, 2009			August 1, 2008
Segment Sales
Avionics & Controls	$	171,027		$	147,926		$	468,606		$	438,008
Sensors & Systems		84,460			103,320			255,770			294,193
Advanced Materials		105,999			112,218			306,329			346,621
Net Sales		361,486			363,464			1,030,705			1,078,822
Cost of Sales		244,339			250,106			698,808			728,864
		117,147			113,358			331,897			349,958
Expenses
Selling, general and administrative		59,694			60,957			174,038			178,082
Research, development and engineering		14,868			21,460			50,560			68,138
Total Expenses		74,562			82,417			224,598			246,220
Other
Other expense		218			--			7,946			86
Total Other		218			--			7,946			86
Operating Earnings From Continuing Operations		42,367			30,941			99,353			103,652
Interest income		(168	)		(1,066	)		(949	)		(3,297	)
Interest expense		7,024			7,339			21,370			22,517
Gain on derivative financial instruments		--			--			--			(1,850	)
Other Expense, Net		6,856			6,273			20,421			17,370
Income From Continuing Operations
Before Income Taxes		35,511			24,668			78,932			86,282
Income Tax Expense		3,009			6,232			9,493			13,981
Income From Continuing Operations
Before Minority Interest		32,502			18,436			69,439			72,301
Minority Interest		(24	)		(36	)		(136	)		(229	)
Income From Continuing Operations		32,478			18,400			69,303			72,072
Income From Discontinued Operations,
Net of Tax		163			2,082			15,994			4,579
Net Earnings	$	32,641		$	20,482		$	85,297		$	76,651
Earnings Per Share – Basic:
Continuing Operations	$	1.09		$	.62		$	2.33		$	2.45
Discontinued Operations		.01			.07			.54			.15
Earnings Per Share – Basic	$	1.10		$	.69		$	2.87		$	2.60
Earnings Per Share – Diluted:
Continuing Operations	$	1.09		$	.61		$	2.32		$	2.41
Discontinued Operations		.00			.07			.54			.15
Earnings Per Share – Diluted	$	1.09		$	.68		$	2.86		$	2.56
Weighted Average Number of Shares Outstanding – Basic		29,736			29,575			29,701			29,466
Weighted Average Number of Shares Outstanding – Diluted		29,870			29,994			29,855			29,894

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Page 4 of 4 Esterline Reports Third Quarter 2009

Consolidated Balance Sheet (unaudited)
In thousands	July 31,		August 1,
	2009		2008
Assets
Current Assets
Cash and cash equivalents	$	148,807	$	162,552
Accounts receivable, net		248,476		249,083
Inventories		296,398		298,461
Income tax refundable		9,453		6,495
Deferred income tax benefits		28,636		31,907
Prepaid expenses		17,013		15,774
Other current assets		19,240		--
Total Current Assets		768,023		764,272
Property, Plant and Equipment, Net		243,955		215,909
Other Non-Current Assets
Goodwill		743,864		651,381
Intangibles, net		435,433		339,146
Debt issuance costs, net		7,612		7,957
Deferred income tax benefits		65,518		46,041
Other assets		8,541		25,715
	$	2,272,946	$	2,050,421
Liabilities and Shareholders’ Equity
Current Liabilities
Accounts payable	$	70,754	$	88,763
Accrued liabilities		211,208		181,583
Credit facilities		3,798		8,550
Current maturities of long-term debt		798		8,649
Federal and foreign income taxes		4,372		14,173
Total Current Liabilities		290,930		301,718
Long-Term Liabilities
Long-term debt, net of current maturities		509,776		390,221
Deferred income taxes liabilities		129,006		118,307
Other liabilities		98,557		54,051
Commitments and Contingencies		--		--
Minority Interest		2,933		2,643
Shareholders’ Equity		1,241,744		1,183,481
	$	2,272,946	$	2,050,421