Teradyne (TER) 8-K Completion of Acquisition or Disposition of Assets

Exhibit 99.1

TERADYNE, INC.

UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET

	October 2, 2005
	Company Historical (1)			Sale of Connection Systems (2)			Pro Forma Adjustments			Company Pro Forma Combined
	($ in thousands, except per share amounts)
ASSETS
Current assets:
Cash and cash equivalents	$	230,345		$	—		$	383,314	(a)	$	613,659
Marketable securities		91,291			—			—			91,291
Accounts receivable, net		269,283			(64,311	)		7,908	(b)		212,880
Inventories, net		222,190			(52,546	)		—			169,644
Prepayments and other current assets		32,675			(7,030	)		486	(b)		26,131
Total current assets		845,784			(123,887	)		391,708			1,113,605
Property, plant and equipment		1,327,064			(274,606	)		48,166			1,100,624
Less: Accumulated depreciation		(813,115	)		174,202			(24,762	)		(663,675	)
Net property, plant and equipment		513,949			(100,404	)		23,404	(b)		436,949
Marketable securities		244,196			—			—			244,196
Goodwill		116,176			(47,031	)		—			69,145
Other assets		40,450			(2,618	)		2,550	(b)		40,383
Total assets	$	1,760,556		$	(273,940	)	$	417,662		$	1,904,278
LIABILITIES
Current liabilities:
Notes payable—banks	$	2,657		$	—		$	—		$	2,657
Current portion of long-term debt		294			—			—			294
Accounts payable		89,746			(21,323	)		1,564	(c)		69,987
Accrued employees’ compensation and withholdings		78,416			(24,067	)		13,186	(c)		67,535
Deferred revenue and customer advances		29,032			(1,044	)		—			27,988
Other accrued liabilities		57,247			(419	)		2,103	(c)		58,931
Income taxes payable		7,891			(656	)		454	(c)		7,689
Total current liabilities		265,283			(47,509	)		17,307			235,081
Pension liability		41,755			—			—			41,755
Long-term other accrued liabilities		45,527			—			—			45,527
Convertible senior notes		371,500			—			—			371,500
Other long-term debt		7,012			—			—			7,012
Total liabilities		731,077			(47,509	)		17,307			700,875
Commitments and contingencies
SHAREHOLDERS’ EQUITY
Common stock, $0.125 par value, 1,000,000,000 shares authorized, 196,868,000 shares outstanding at October 2, 2005		24,608			—			—			24,608
Additional paid-in capital		801,574			—			—			801,574
Accumulated other comprehensive loss		(65,008	)		—			—			(65,008	)
Retained earnings		268,305			(226,431	)		400,355	(d)		442,229
Total liabilities and shareholders’ equity	$	1,760,556		$	(273,940	)	$	417,662		$	1,904,278

(1) As reported in Teradyne’s unaudited Quarterly Report on Form 10-Q for the nine months ended October 2, 2005.

(2) Derived from Teradyne’s unaudited financial information as of October 2, 2005.

TERADYNE, INC.

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

	For the Nine Months Ended October 2, 2005
	Company Historical (1)			Sale of Connection Systems (2)			Pro Forma Adjustments			Company Pro Forma Combined
	($ in thousands, except per share amounts)
Net revenues:
Products	$	856,711		$	(282,364	)	$	—		$	574,347
Services		155,734			—			—			155,734
Total net revenues		1,012,445			(282,364	)		—			730,081
Cost of revenues:
Cost of products		595,998			(229,104	)		(444	)(e)		366,450
Cost of services		125,501			—			—			125,501
Gross profit		290,946			(53,260	)		444			238,130
Operating expenses:
Engineering and development		181,414			(7,959	)		(210	)(e)		173,245
Selling and administrative		198,166			(29,193	)		9,395	(e), (f), (g)		178,368
Restructuring and other charges		35,772			(7,735	)		—			28,037
Gain on sale of business		(612	)		612			—			—
Total operating expenses		414,740			(44,275	)		9,185			379,650
Loss from operations		(123,794	)		(8,985	)		(8,741	)		(141,520	)
Interest income		12,218			—			—			12,218
Interest expense		(12,646	)		—			—			(12,646	)
Other income and expense, net		—			—			—			—
Loss before income taxes		(124,222	)		(8,985	)		(8,741	)		(141,948	)
Provision for income taxes		9,192			(1,205	)		(174	)(i)		7,813
Net loss	$	(133,414	)	$	(7,780	)	$	(8,567	)	$	(149,761	)
Net loss per common share—basic	$	(0.68	)							$	(0.76	)
Shares used in computing net loss per common share—basic		196,070									196,070
Net loss per common share—diluted	$	(0.68	)							$	(0.76	)
Shares used in computing net loss per common share—diluted		196,070									196,070

(1) As reported in Teradyne’s unaudited quarterly report on Form 10-Q for the nine months ended October 2, 2005.

(2) Derived from Teradyne’s unaudited financial information for the nine months ended October 2, 2005.

TERADYNE, INC.

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

	For the Nine Months Ended October 3, 2004
	Company Historical (1)			Sale of Connection Systems (2)			Pro Forma Adjustments			Company Pro Forma Combined
	($ in thousands, except per share amounts)
Net revenues:
Products	$	1,238,207		$	(288,637	)	$	—		$	949,570
Services		176,659			—			—			176,659
Total net revenues		1,414,866			(288,637	)		—			1,126,229
Cost of revenues:
Cost of products		702,515			(223,181	)		(1,901	)(e), (h)		477,433
Cost of services		121,292			—			—			121,292
Gross profit		591,059			(65,456	)		1,901			527,504
Operating Expenses:
Engineering and development		198,851			(8,222	)		(901	)(e), (h)		189,728
Selling and administrative		206,503			(30,051	)		8,119	(e), (f), (g), (h)		184,571
Restructuring and other charges		236			(616	)		—			(380	)
Gain on sale of business		(865	)		865			—			—
Total operating expenses		404,725			(38,024	)		7,218			373,919
Income from operations		186,334			(27,432	)		(5,317	)		153,585
Interest income		10,845			—			—			10,845
Interest expense		(14,223	)		—			—			(14,223	)
Other income and expense, net		1,277			—			—			1,277
Income before income taxes		184,233			(27,432	)		(5,317	)		151,484
Provision for income taxes		22,344			(786	)		(106	)(i)		21,452
Net income	$	161,889		$	(26,646	)	$	(5,211	)	$	130,032
Net income per common share—basic	$	0.83								$	0.67
Shares used in computing net income per common share—basic		193,998									193,998
Net income per common share—diluted (3)	$	0.81								$	0.66
Shares used in computing net income per common share—diluted		213,137									197,915

(1) As reported in Teradyne’s unaudited quarterly report on Form 10-Q for the nine months ended October 3, 2004.

(2) Derived from Teradyne’s unaudited financial information for the nine months ended October 3, 2004.

(3) For the Company Pro Forma, diluted shares do not assume the conversion of the convertible debentures as the effect on EPS would be anti-dilutive.

TERADYNE, INC.

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

	For the Year Ended December 31, 2004
	Company Historical (1)			Sale of Connection Systems (2)			Pro Forma Adjustments			Company Pro Forma Combined
	($ in thousands, except per share amounts)
Net revenues:
Products	$	1,554,847		$	(381,658	)	$	—		$	1,173,189
Services		237,033			—			—			237,033
Total net revenues		1,791,880			(381,658	)		—			1,410,222
Cost of revenues:
Cost of products		903,496			(301,342	)		(2,057	)(e), (h)		600,097
Cost of services		164,511			—			—			164,511
Gross profit		723,873			(80,316	)		2,057			645,614
Operating Expenses:
Engineering and development		262,000			(11,060	)		(974	)(e), (h)		249,966
Selling and administrative		268,576			(40,728	)		11,292	(e), (f), (g), (h)		239,140
Restructuring and other charges		5,359			(4,148	)		—			1,211
Gain on sale of business		(865	)		865			—			—
Total operating expenses		535,070			(55,071	)		10,318			490,317
Income from operations		188,803			(25,245	)		(8,261	)		155,297
Interest income		15,387			—			—			15,387
Interest expense		(18,752	)		—			—			(18,752	)
Other income and expenses, net		2,536			—			—			2,536
Income before income taxes		187,974			(25,245	)		(8,261	)		154,468
Provision for income taxes		22,737			(914	)		(165	)(i)		21,658
Net income	$	165,237		$	(24,331	)	$	(8,096	)	$	132,810
Net income per common share—basic	$	0.85								$	0.68
Shares used in computing net income per common share—basic		194,048									194,048
Net income per common share—diluted	$	0.84								$	0.67
Shares used in computing net income per common share—diluted		197,432									197,432

(1) As reported in Teradyne’s audited annual report on Form 10-K for the year ended December 31, 2004.

(2) Derived from Teradyne’s audited financial information for the year ended December 31, 2004.

TERADYNE, INC.

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

	For the Year Ended December 31, 2003
	Company Historical (1)			Sale of Connection Systems (2)			Pro Forma Adjustments			Company Pro Forma Combined
	($ in thousands, except per share amounts)
Net revenues:
Products	$	1,115,888		$	(357,175	)	$	—		$	758,713
Services		236,979			—			—			236,979
Total net revenues		1,352,867			(357,175	)		—			995,692
Cost of revenues:
Cost of products		798,748			(316,848	)		(274	)(e)		481,626
Cost of services		155,220			—			—			155,220
Gross profit		398,899			(40,327	)		274			358,846
Operating Expenses:
Engineering and development		254,600			(10,235	)		(130	)(e)		244,235
Selling and administrative		249,464			(38,484	)		13,310	(e), (f), (g)		224,290
Restructuring and other charges		71,284			(27,581	)		—			43,703
Total operating expenses		575,348			(76,300	)		13,180			512,228
Loss from operations		(176,449	)		35,973			(12,906	)		(153,382	)
Interest income		14,013			—			—			14,013
Interest expense		(20,883	)		—			—			(20,883	)
Other income and expense, net		(2,874	)		—			—			(2,874	)
Loss before income taxes		(186,193	)		35,973			(12,906	)		(163,126	)
Provision for income taxes		7,800			(919	)		—			6,881
Net Loss	$	(193,993	)	$	36,892		$	(12,906	)	$	(170,007	)
Net loss per common share—basic	$	(1.03	)							$	(0.91	)
Shares used in computing net loss per common share—basic		187,845									187,845
Net loss per common share—diluted	$	(1.03	)							$	(0.91	)
Shares used in computing net loss per common share—diluted		187,845									187,845

(1) As reported in Teradyne’s audited annual report on Form 10-K for the year ended December 31, 2004.

(2) Derived from Teradyne’s audited financial information for the year ended December 31, 2003.

TERADYNE, INC.

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

	For the Year Ended December 31, 2002
	Company Historical (1)			Sale of Connection Systems (2)			Pro Forma Adjustments			Company Pro Forma Combined
	($ in thousands, except per share amounts)
Net revenues:
Products	$	992,127		$	(396,994	)	$	—		$	595,133
Services		230,109			—			—			230,109
Total net revenues		1,222,236			(396,994	)		—			825,242
Cost of revenues:
Cost of products		829,172			(372,356	)		(235	)(e)		456,581
Cost of services		160,395			—			—			160,395
Gross profit		232,669			(24,638	)		235			208,266
Operating Expenses:
Engineering and development		293,922			(13,137	)		(111	)(e)		280,674
Selling and administrative		290,376			(40,385	)		10,256	(e), (f), (g)		260,247
Restructuring and other charges		125,240			(54,511	)		—			70,729
Goodwill Impairment		78,936			—			—			78,936
Total operating expenses		788,474			(108,033	)		10,145			690,586
Loss from operations		(555,805	)		83,395			(9,910	)		(482,320	)
Interest income		16,953			—			—			16,953
Interest expense		(21,783	)		—			—			(21,783	)
Other income and expense, net		(310	)		—			—			(310	)
Loss before income taxes		(560,945	)		83,395			(9,910	)		(487,460	)
Provision for income taxes		157,524			(17,769	)		—			139,755
Net Loss	$	(718,469	)	$	101,164		$	(9,910	)	$	(627,215	)
Net loss per common share—basic	$	(3.93	)							$	(3.43	)
Shares used in computing net loss per common share—basic		182,861									182,861
Net loss per common share—diluted	$	(3.93	)							$	(3.43	)
Shares used in computing net loss per common share—diluted		182,861									182,861

(1) As reported in Teradyne’s audited annual report on Form 10-K for the year ended December 31, 2004.

(2) Derived from Teradyne’s audited financial information for the year ended December 31, 2002.

NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS

Pro forma adjustments reflect only those adjustments which are supportable and directly attributable to the transaction and do not include the impact of contingencies. Pro forma adjustments include the following ($ in thousands):

(a) To record cash proceeds net of transaction costs of $383,314 for the sale of TCS.

(b) To add back certain assets of TCS which will be retained by Teradyne.

(c) To add back certain liabilities of TCS which will be retained by Teradyne, primarily employee compensation and benefit accruals.

(d) Adjustment to Equity of $400,355, consists of net assets of TCS sold to Amphenol of $209,390, net assets remaining with Teradyne of $17,041, and the estimated gain on sale of net assets of $173,924.

(e) To remove TCS’ variable compensation expense that is included in Corporate:

	Cost of Goods Sold		Selling & Administrative		Engineering & Development		Total
Twelve Months Ended:
December 31, 2004	$	484	$	560	$	229	$	1,273
December 31, 2003		274		318		130		722
December 31, 2002		235		272		111		618
Nine Months Ended:
October 2, 2005	$	444	$	514	$	210	$	1,168
October 3, 2004		363		420		172		955

(f) To add back G&A expenses that will remain with Teradyne of $9,232 and $9,578 for the nine months ended October 2, 2005 and October 3, 2004, respectively, and $12,685, $12,673 and $9,637 for the years ended December 31, 2004, 2003 and 2002, respectively.

(g) To add back depreciation for assets that will remain with Teradyne of $677 and $742 for the nine months ended October 2, 2005 and October 3, 2004, respectively, and $989 and $955 and $891 for the years ended December 31, 2004, 2003 and 2002, respectively.

(h) To remove TCS’ profit sharing expense that is included in Corporate:

	Cost of Goods Sold		Selling & Administrative		Engineering & Development		Total
Twelve Months Ended:
December 31, 2004	$	1,573	$	1,822	$	745	$	4,140
Nine Months Ended:
October 3, 2004	$	1,538	$	1,781	$	729	$	4,048

(i) Expenses incurred in the United States subject to Alternative Minimum Tax.

(j) The pro forma financial statements do not include interest income on the estimated net proceeds. Assuming a 4.25% annual rate of return on the estimated net proceeds from the transaction of $383,314, the following is the estimated interest income:

Twelve Months Ended:
12/31/2004	$	17,705
12/31/2003		16,983
12/31/2002		16,291
Nine Months Ended
10/2/2005	$	13,843
10/3/2004		13,279