Company: TDY
Filing Date: 2025-02-21
Form Type: 10-K
Source: 0001094285-25-000053
Chunk: 263

Company: TELEDYNE TECHNOLOGIES INC
Filing Date: 2025-02-21
Form: 10-K
Item: Item 7
Chunk 263
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  Current inventory costs, the costs of labor, materials, equipment and other costs are considered in establishing sales pricing policies.  In addition, we emphasize cost containment and cost reductions in all aspects of our business. 

Market Risk Disclosures

Our primary exposure to market risk relates to changes in interest rates and foreign currency exchange rates.  We periodically evaluate these risks and have taken measures to mitigate these risks.  We own assets and operate facilities in countries that have been politically stable.

Interest Rate Risk

We are exposed to market risk through the interest rate on our borrowings under our $1.20 billion credit facility.  As of December 29, 2024, no borrowings are outstanding under our credit facility.  Future indebtedness incurred under our credit facility will expose us to interest rate risk.

Foreign Currency Exchange Rate Risk

Teledyne transacts business in various foreign currencies and has international sales and expenses denominated in foreign currencies, subjecting the Company to foreign currency risk.  Our primary foreign currency risk management objective is to protect the U.S. dollar value of future cash flows and minimize the volatility of reported earnings, primarily achieved through the following:

•We utilize foreign currency forward contracts to reduce the volatility of cash flows primarily related to forecasted revenue and expenses denominated in Canadian dollars for our Canadian companies, and in British pounds for our U.K. companies.  These contracts are designated and qualify as cash flow hedges.

•We utilize foreign currency forward contracts to mitigate foreign exchange rate risk associated with foreign currency denominated monetary assets and liabilities, including intercompany receivables and payables.  

All derivatives are recorded on the balance sheet at fair value.  The accounting for gains and losses resulting from changes in fair value depends on the use of the derivative and whether it is designated and qualifies for hedge accounting.  Teledyne does not use foreign currency forward contracts for speculative or trading purposes.  Refer to Notes 2, 14 and 15 for further disclosures around our derivative instruments and hedging activities.

Notwithstanding our efforts to mitigate portions of our foreign currency exchange rate risks, there can be no assurance that our hedging activities will adequately protect us against the risks associated with foreign currency fluctuations.  A hypothetical 10% price change of the U.S. dollar from its value on December 29, 2024, would result in a decrease or increase in the fair value of our foreign currency forward contracts designated as cash flow hedges to buy Canadian dollars and sell U.S. dollars by approximately $8.7