<Page>

================================================================================

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                 ---------------

                                    FORM 10-Q

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

                  FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2002

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

             FOR THE TRANSITION PERIOD FROM __________ TO __________

                          COMMISSION FILE NUMBER 1-8533

                                 ---------------

                             DRS TECHNOLOGIES, INC.

             DELAWARE                            13-2632319
     (State or other jurisdiction of             (I.R.S. Employer
      incorporation or organization)             Identification No.)

                   5 SYLVAN WAY, PARSIPPANY, NEW JERSEY 07054
                                 (973) 898-1500

                                 ---------------

   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 AND 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 /X/                     NO / /

As of August 13, 2002, 16,861,162 shares of DRS Technologies, Inc. Common Stock,
$.01 par value, were outstanding.

================================================================================

<Page>

                     DRS TECHNOLOGIES, INC. AND SUBSIDIARIES

                               ------------------

                     INDEX TO QUARTERLY REPORT ON FORM 10-Q
                       FOR THE QUARTER ENDED JUNE 30, 2002

<Table>
<Caption>
                                      PART I - FINANCIAL INFORMATION                                PAGE NO.
       <S>       <C>                                                                                <C>
       ITEM 1.   Financial Statements

                 Consolidated Balance Sheets - June 30, 2002 and March 31, 2002..................   1

                 Consolidated Statements of Earnings - Three Months Ended June 30, 2002 and 2001    2

                 Consolidated Statements of Cash Flows - Three Months Ended June 30, 2002 and
                 2001............................................................................   3

                 Notes to Consolidated Financial Statements......................................   4 - 9

       ITEM 2.   Management's Discussion and Analysis of Financial Condition and Results of
                 Operations......................................................................   10 - 18

       ITEM 3.   Quantitative and Qualitative Disclosures about Market Risk......................   18

                                       PART II - OTHER INFORMATION

       ITEM 1.   Legal Proceedings...............................................................   19

       ITEM 6.   Exhibits and Reports on Form 8-K................................................   19

  SIGNATURES     ................................................................................   20
</Table>

<Page>


PART I - FINANCIAL INFORMATION

ITEM 1.                           FINANCIAL STATEMENTS


                     DRS TECHNOLOGIES, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                        (IN THOUSANDS, EXCEPT SHARE DATA)


<Table>
<Caption>
                                                                                  (UNAUDITED)
                                                                                     JUNE 30,      MARCH 31,
                                                                                       2002          2002
                                                                                  ---------       ----------
<S>                                                                               <C>             <C>

                                    ASSETS

Current assets:
          Cash and cash equivalents                                               $ 114,523      $ 117,782
          Accounts receivable, net                                                   96,356        110,861
          Inventories, net of progress payments                                     117,545        120,910
          Prepaid expenses and other current assets                                  10,321          9,276
                                                                                  ---------      ---------
                                  Total current assets                              338,745        358,829
                                                                                  ---------      ---------

Property, plant and equipment, less accumulated depreciation and amortization
          of $42,613 and $45,389 at June 30, 2002 and March 31, 2002,
          respectively                                                               52,326         50,481

Acquired intangible assets, less accumulated amortization of $7,584 and $7,028
        at June 30, 2002 and March 31, 2002,
        respectively                                                                 33,577         34,133

Goodwill                                                                            144,014        142,610

Deferred income taxes and other noncurrent assets                                    17,647         15,038
                                                                                  ---------      ---------

                                  TOTAL ASSETS                                    $ 586,309      $ 601,091
                                                                                  =========      =========

                     LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
          Current installments of long-term debt                                    $ 1,400         $1,435
          Short-term bank debt                                                          927            226
          Accounts payable                                                           30,399         49,671
          Accrued expenses and other current liabilities                            137,770        142,260
                                                                                  ---------       --------
                                  Total current liabilities                         170,496        193,592

Long-term debt, excluding current installments                                      137,550        138,060
Other noncurrent liabilities                                                         12,492         12,204
                                                                                  ---------       --------
                                  TOTAL LIABILITIES                                 320,538        343,856
                                                                                  ---------       --------

Stockholders' equity:
Preferred stock, no par value. Authorized 2,000,000 shares;
          none issued at June 30, 2002 and March 31, 2002                                --             --
Common Stock, $.01 par value per share.  Authorized 30,000,000
          shares; issued 16,859,912 and 16,834,052 shares at June 30,
          2002 and March 31, 2002, respectively                                         169            168
Additional paid-in capital                                                          197,987        197,387
Retained earnings                                                                    69,790         64,356
Accumulated other comprehensive losses                                               (2,152)        (4,630)
Unamortized stock compensation                                                          (23)           (46)
                                                                                  ---------      ----------
                                  TOTAL STOCKHOLDERS' EQUITY                        265,771        257,235
                                                                                  ---------      ----------

Commitments and contingencies

                                  TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY      $ 586,309      $ 601,091
                                                                                  =========     ==========

</Table>

          See accompanying Notes to Consolidated Financial Statements.


                                       1
<Page>

                DRS TECHNOLOGIES, INC. AND SUBSIDIARIES
                  Consolidated Statements of Earnings
                 (in thousands, except per-share data)

                                   (UNAUDITED)


<Table>
<Caption>
                                                           THREE MONTHS ENDED JUNE 30,
                                                           ---------------------------
                                                              2002          2001
                                                            ---------     ---------


<S>                                                         <C>           <C>
REVENUES                                                    $ 131,238     $ 103,352

Costs and expenses                                            118,565        93,668
                                                            ---------     ---------

OPERATING INCOME                                               12,673         9,684

Interest income                                                   478            25

Interest and related expenses                                   2,283         2,125

Other expense (income), net                                       521           (28)
                                                            ---------     ---------

   Earnings before minority interest
     and income taxes                                          10,347         7,612

Minority interest                                                 284           258
                                                            ---------     ---------

   Earnings before income taxes                                10,063         7,354

Income taxes                                                    4,629         3,456
                                                            ---------     ---------

   NET EARNINGS                                             $   5,434     $   3,898
                                                            =========     =========

NET EARNINGS PER SHARE OF COMMON STOCK:

   BASIC EARNINGS PER SHARE                                 $    0.32     $    0.32

   DILUTED EARNINGS PER SHARE                               $    0.31     $    0.30


</Table>

          See accompanying Notes to Consolidated Financial Statements.


                                       2
<Page>


                     DRS TECHNOLOGIES, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)

                                   (UNAUDITED)


<Table>
<Caption>

                                                                                  THREE MONTHS ENDED JUNE 30,
                                                                                 ---------------------------
                                                                                     2002            2001
                                                                                 ------------     ----------
<S>                                                                                <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
         Net earnings                                                              $   5,434      $   3,898

Adjustments to reconcile net earnings to cash flows from operating activities:
         Depreciation and amortization                                                 3,161          2,881
         Other, net                                                                      491          1,269

Changes in assets and liabilities, net of effects from business combinations:
         Decrease in accounts receivable                                              13,875         23,937
         Decrease (increase) in inventories                                            2,958        (17,239)
         Increase in prepaid expenses and other current assets                          (922)        (2,103)
         Decrease in accounts payable                                                (19,561)        (6,470)
         Decrease in accrued expenses and other current liabilities                   (9,533)        (3,414)
         Increase in customer advances                                                 4,933          2,258
         Other, net                                                                      244           (460)
                                                                                   ---------      ---------

NET CASH PROVIDED BY OPERATING ACTIVITIES                                              1,080          4,557

CASH FLOWS FROM INVESTING ACTIVITIES:
         Capital expenditures                                                         (4,161)        (3,526)
         Payments pursuant to business combinations                                     (750)            --
         Other, net                                                                       96             --
                                                                                   ---------      ---------

NET CASH USED IN INVESTING ACTIVITIES                                                 (4,815)        (3,526)

CASH FLOWS FROM FINANCING ACTIVITIES:
         Net borrowings of short-term debt                                               709            184
         Borrowings on long-term debt                                                     --         16,600
         Repayment of borrowings of long-term debt                                      (545)       (19,819)
         Proceeds from stock option exercises                                            255            729
                                                                                   ---------      ---------

NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES                                      419         (2,306)
                                                                                   ---------      ---------

EFFECT OF EXCHANGE RATES ON CASH AND CASH EQUIVALENTS                                     57            749
                                                                                   ---------      ---------

NET DECREASE IN CASH AND CASH EQUIVALENTS                                             (3,259)          (526)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                                       117,782          2,324
                                                                                   ---------      ---------

CASH AND CASH EQUIVALENTS, END OF PERIOD                                           $ 114,523      $   1,798
                                                                                   =========      =========

</Table>

          See accompanying Notes to Consolidated Financial Statements.


                                       3
<Page>

                     DRS TECHNOLOGIES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                   (UNAUDITED)

1.   BASIS OF PRESENTATION

          The accompanying unaudited Consolidated Financial Statements of DRS
     Technologies, Inc. and Subsidiaries (DRS or the Company) have been prepared
     in accordance with accounting principles generally accepted in the United
     States of America and with the instructions to Form 10-Q and Article 10 of
     Regulation S-X. The Company has continued to follow the accounting policies
     set forth in the consolidated financial statements included in its fiscal
     2002 Annual Report on Form 10-K filed with the Securities and Exchange
     Commission. In the opinion of the Company, the interim financial
     information provided herein reflects all adjustments (consisting of normal
     and recurring adjustments) necessary for a fair presentation of the
     Company's consolidated financial position as of June 30, 2002, and the
     results of operations and cash flows for the three-month periods ended June
     30, 2002 and 2001. The results of operations for the three-months ended
     June 30, 2002 are not necessarily indicative of the results to be expected
     for the full year.

          For further information, these interim financial statements should be
     read in conjunction with the Consolidated Financial Statements of the
     Company for the fiscal year ended March 31, 2002, included in the Company's
     Annual Report on Form 10-K for the fiscal year ended March 31, 2002.

2.   BUSINESS COMBINATIONS AND DISPOSALS

          On July 15, 2002, the Company acquired the assets and assumed certain
     liabilities of the Navy Controls Division of Eaton Corporation for $92.2
     million in cash, subject to adjustment. The Company financed the
     acquisition with existing cash on hand. Renamed DRS Power & Control
     Technologies, Inc. (DRS PCT), and located in Milwaukee, Wisconsin, and
     Danbury, Connecticut, the company is a leading supplier of high-performance
     power conversion and instrumentation and control systems for the U.S.
     Navy's combatant fleet, including nuclear-powered and conventionally
     powered ships, as well as to specialized industrial customers. Products
     include ship electric propulsion equipment, power electronics equipment,
     high-performance networks, shipboard control equipment and control panels,
     tactical displays, and specialty reactor instrumentation and control
     equipment. DRS PCT is being managed as a part of the Electronic Systems
     Group. The addition of this unit to ESG complements our presence in naval
     advanced command and control computer display and other ship systems. DRS
     PCT has over 600 employees. The acquisition will be accounted for using the
     purchase method of accounting.

          On May 27, 2002, the Company sold the assets of the DRS Ahead
     Technology operating unit. DRS Ahead Technology produces magnetic head
     components used in the manufacturing process of computer disk drives and
     manufactures magnetic video recording heads used in broadcast television
     equipment. The operating unit recorded $1.3 million of revenue and $0.4
     million of operating loss for the period it was owned by the Company during
     the first quarter of fiscal 2003 and $2.2 million of revenue and $0.3
     million of operating loss for the first quarter of fiscal 2002. The assets
     of DRS Ahead Technology were sold for their aggregate book value, and DRS
     received an interest bearing promissory note in the amount of $3.1 million
     as consideration for the sale. The promissory note bears interest and is
     payable over an 80-month term. No gain or loss was recorded on the sale.

          On April 11, 2002, the Company acquired the assets of the U.S.-based
     Unmanned Aerial Vehicle (UAV) business of Meggitt Defense Systems - Texas,
     Inc., a unit of Meggitt plc for $0.8 million in cash. The business, located
     in Mineral Wells, Texas and now operating as DRS Unmanned Technologies,
     Inc. provides close-range, low-weight, low-noise, medium-duration UAVs
     supporting military special operations missions. Applications for these
     products include tactical short-range surveillance, radio relay, and
     command, control, communications, computers, intelligence, surveillance and
     reconnaissance. The operations of DRS Unmanned Technologies are not
     significant to DRS's consolidated operating results. The acquisition was
     accounted for using the purchase method of accounting.

                                        4
<Page>

                     DRS TECHNOLOGIES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                   (UNAUDITED)

3.   INVENTORIES

          Inventories are summarized as follows:

<Table>
<Caption>
                                             JUNE 30,       MARCH 31,
                                               2002           2002
                                           ------------   ------------
                                                 (IN THOUSANDS)
               <S>                         <C>            <C>
               Work-in-process             $    143,729   $    139,748
               Raw material and finished
                goods                             8,104          9,127
                                           ------------   ------------
                                                151,833        148,875
                                           ------------   ------------
               Less progress payments           (34,288)       (27,965)
                                           ------------   ------------

               Total                       $    117,545   $    120,910
                                           ============   ============
</Table>

          General and administrative costs included in work-in-process were
     approximately $17.4 million and $16.3 million at June 30, 2002 and March
     31, 2002, respectively. General and administrative expenses included in
     costs and expenses amounted to approximately $28.7 million and $20.7
     million for the three-month periods ended June 30, 2002 and 2001,
     respectively. Included in those amounts are expenditures for internal
     research and development amounting to approximately $2.9 million and $2.1
     million for the fiscal quarters ended June 30, 2002 and 2001, respectively.

4.   GOODWILL AND INTANGIBLE ASSETS

          The following disclosure presents certain information on the Company's
     acquired intangible assets as of June 30, 2002 and March 31, 2002. All
     acquired intangible assets are being amortized over their estimated useful
     lives, as indicated below, with no estimated residual values.

<Table>
<Caption>
                                         WEIGHTED AVERAGE     GROSS CARRYING    ACCUMULATED
ACQUIRED INTANGIBLE ASSETS              AMORTIZATION PERIOD      AMOUNT        AMORTIZATION   NET BALANCE
-------------------------------------   -------------------   --------------   ------------   -----------
                                                                             (IN THOUSANDS)
<S>                                           <C>             <C>              <C>            <C>
AS OF JUNE 30, 2002
Amortized acquired intangible assets:
  Technology-based intangibles                21 years        $       22,931   $     (5,449)  $    17,482
  Customer-related intangibles                19 years                18,230         (2,135)       16,095
                                                              --------------   ------------   -----------
TOTAL                                                         $       41,161   $     (7,584)  $    33,577
                                                              ==============   ============   ===========

AS OF MARCH 31, 2002
Amortized acquired intangible assets:
  Technology-based intangibles                21 years        $       22,931   $     (5,155)  $    17,776
  Customer-related intangibles                19 years                18,230         (1,873)       16,357
                                                              --------------   ------------   -----------
TOTAL                                                         $       41,161   $     (7,028)  $    34,133
                                                              ==============   ============   ===========
</Table>

          The aggregate acquired intangible asset amortization expense for the
     three-month periods ended June 30, 2002 and 2001 were $0.6 million and $0.4
     million, respectively. The estimated acquired intangible amortization
     expense for the fiscal year ending March 31, 2003 and for each of the
     subsequent four fiscal years ending March 31, 2007 is approximately $2.2
     million.

                                        5
<Page>

                     DRS TECHNOLOGIES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                   (UNAUDITED)

          The table below reconciles the change in the carrying amount of
     goodwill by operating segment for the period from March 31, 2002 to June
     30, 2002.

<Table>
<Caption>
                                                                                              FLIGHT SAFETY AND
                                                    ELECTRONIC          ELECTRO-OPTICAL        COMMUNICATIONS
                                                  SYSTEMS GROUP          SYSTEMS GROUP             GROUP              TOTAL
                                               --------------------   --------------------   --------------------   ----------
                                                                                  (IN THOUSANDS)
     <S>                                       <C>                    <C>                    <C>                    <C>
     Balance as of March 31, 2002              $             28,127   $             84,410   $             30,073   $  142,610
     Foreign currency translation adjustment                    513                      -                    789        1,302
     Other adjustments                                            -                    102                      -          102
                                               --------------------   --------------------   --------------------   ----------
     Balance as of June 30, 2002               $             28,640   $             84,512   $             30,862   $  144,014
                                               ====================   ====================   ====================   ==========
</Table>

5.   EARNINGS PER SHARE

     The following table presents the computation of basic and diluted earnings
     per share (EPS):

<Table>
<Caption>
                                                THREE MONTHS ENDED JUNE 30,
                                               ----------------------------
                                                  2002            2001
                                               ------------   -------------
                                                   (IN THOUSANDS, EXCEPT
                                                      PER-SHARE DATA)
          <S>                                  <C>            <C>
          BASIC EPS COMPUTATION:
             Net earnings                      $      5,434   $       3,898
                                               ------------   -------------
             Weighted average common shares
               outstanding                           16,843          12,095
                                               ------------   -------------
          Basic earnings per share             $       0.32   $        0.32
                                               ============   =============

          DILUTED EPS COMPUTATION:
             Net earnings                      $      5,434   $       3,898
                                               ------------   -------------
             Diluted common shares outstanding:
               Weighted average common shares
                outstanding                          16,843          12,095
               Stock options and warrants               801             936
                                               ------------   -------------
             Diluted common shares outstanding       17,644          13,031
                                               ------------   -------------
             Diluted earnings per share        $       0.31   $        0.30
                                               ============   =============
</Table>

                                        6
<Page>

                     DRS TECHNOLOGIES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                   (UNAUDITED)

6.   COMPREHENSIVE EARNINGS

          The components of comprehensive earnings for the three-month periods
     ended June 30, 2002 and 2001 consisted of the following:

<Table>
<Caption>
                                                                    THREE MONTHS ENDED JUNE 30,
                                                                    ---------------------------
                                                                        2002           2001
                                                                    ------------   ------------
                                                                         (IN THOUSANDS)
          <S>                                                       <C>            <C>
          Net earnings                                              $      5,434   $      3,898
          Other comprehensive earnings (losses):
            Foreign currency translation adjustments                       2,460            215
            Unrealized losses on hedging instruments:
              Cumulative adjustment at April 1, 2001                           -           (289)
              Unrealized gains (losses) arising during the period             18            (71)
                                                                    ------------   ------------
          Comprehensive earnings                                    $      7,912   $      3,753
                                                                    ============   ============
</Table>

7.   OPERATING SEGMENTS

          DRS operates in three principal business segments on the basis of
     products and services offered: the Electronic Systems Group (ESG), the
     Electro-Optical Systems Group (EOSG), and the Flight Safety and
     Communications Group (FSCG). All other operations are grouped in "Other."
     Information about the Company's segments for the fiscal periods ended June
     30, 2002 and 2001 is as follows:

<Table>
<Caption>
                                         ESG          EOSG        FSCG         OTHER        TOTAL
                                      ----------   ----------   ----------   ----------   ----------
                                                              (IN THOUSANDS)
     <S>                              <C>          <C>          <C>          <C>          <C>
     QUARTER ENDED JUNE 30, 2002
     Total revenues                   $   34,911   $   69,178   $   27,309   $    1,858   $  133,256
       Intersegment revenues                   -         (184)      (1,834)           -       (2,018)
                                      ----------   ----------   ----------   ----------   ----------
     External  revenues               $   34,911   $   68,994   $   25,475   $    1,858   $  131,238
                                      ----------   ----------   ----------   ----------   ----------
     Operating income (loss)          $    1,343   $    9,875   $    2,257   $     (802)  $   12,673
     Identifiable assets              $  109,411   $  246,357   $  112,971   $  117,570   $  586,309
     Depreciation and amortization    $      471   $    1,707   $      690   $      293   $    3,161
     Capital expenditures             $      405   $    3,409   $      142   $      205   $    4,161

     QUARTER ENDED JUNE 30, 2001
     Total revenues                   $   38,096   $   41,933   $   22,297   $    2,236   $  104,562
       Intersegment revenues                 (17)         (94)      (1,099)           -       (1,210)
                                      ----------   ----------   ----------   ----------   ----------
     External  revenues               $   38,079   $   41,839   $   21,198   $    2,236   $  103,352
                                      ----------   ----------   ----------   ----------   ----------
     Operating income (loss)          $    4,808   $    4,477   $      801   $     (402)  $    9,684
     Identifiable assets              $  109,129   $  112,763   $   94,136   $   13,725   $  329,753
     Depreciation and amortization    $      374   $    1,271   $      764   $      472   $    2,881
     Capital expenditures             $      831   $    1,764   $      624   $      307   $    3,526
</Table>

                                        7
<Page>

                     DRS TECHNOLOGIES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                   (UNAUDITED)

8.   SUPPLEMENTAL CASH FLOW INFORMATION

<Table>
<Caption>
                                                        THREE MONTHS ENDED JUNE 30,
                                                        ---------------------------
                                                            2002          2001
                                                        ------------   ------------
                                                               (IN THOUSANDS)
          <S>                                           <C>            <C>
          Cash paid for:
            Income taxes                                $      1,826   $      6,353
            Interest                                    $      2,937   $      1,869

          Noncash investing and financing activities:
            Note receivable - sale of operating unit    $      3,070   $          -
</Table>

9.   CONTINGENCIES

          The Company is a party to various legal actions and claims arising in
     the ordinary course of its business. In the Company's opinion, the Company
     has adequate legal defenses for each of the actions and claims, and
     believes that their ultimate disposition will not have a material adverse
     effect on the Company's consolidated financial position or results of
     operations.

          The Company currently is involved in a dispute with Spar Aerospace
     Ltd. (Spar) with respect to the working capital adjustment, if any,
     provided for in the purchase agreement between the Company and Spar dated
     as of September 19, 1997, pursuant to which the Company acquired, through
     certain of its subsidiaries, certain assets of Spar. On January 11, 2002,
     the Company was notified that an arbitrator awarded Spar $4,616,000
     Canadian (or approximately $2,890,000 U.S.) plus interest in respect of
     such working capital adjustment. As of March 31, 2002, the Company had
     accrued approximately $3.9 million, including interest associated with the
     potential award. On February 5, 2002, the Company filed a notice of appeal
     of such arbitral award with the Ontario Superior Court of Justice. The
     appeal currently is scheduled to be heard in September 2002.

          On October 3, 2001, a lawsuit was filed in the United States District
     Court for the Eastern District of New York by Miltope Corporation, a
     corporation of the State of Alabama, and IV Phoenix Group, Inc., a
     corporation of the State of New York, against DRS Technologies, Inc., DRS
     Electronic Systems, Inc. and a number of individual defendants, several of
     whom are employed by DRS Electronic Systems, Inc. The plaintiffs allege
     claims against the Company of infringement of a number of patents, breach
     of a confidentiality agreement, misappropriation of trade secrets, unjust
     enrichment and unfair competition. The claims relate generally to the
     activities of certain former employees of IV Phoenix Group and the hiring
     of some of those employees by DRS. The plaintiffs seek damages of not less
     than $5.0 million for each of the claims. The plaintiffs also allege claims
     for tortious interference with business relationships, tortious
     interference with contracts and conspiracy to breach fiduciary duty. The
     plaintiffs seek damages of not less than $47.1 million for each such claim.
     In addition, plaintiffs seek punitive and treble damages, injunctive relief
     and attorney's fees. In its answer, the Company has denied the plaintiffs'
     allegations and intends to vigorously defend this action. In February 2002,
     plaintiffs filed an amended complaint, which eliminated the patent
     infringement claims and added claims related to statutory and common law
     trademark infringement. Although this action is in its early stages, the
     Company believes it has meritorious defenses and does not believe the
     action will have a material adverse effect on its earnings or financial
     condition.

                                        8
<Page>

                     DRS TECHNOLOGIES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                   (UNAUDITED)

10.  RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

          In June 2001, the Financial Accounting Standards Board (FASB) issued
     Statement of Financial Accounting Standards (SFAS) No. 143, "Accounting for
     Retirement Obligations" (SFAS 143). SFAS 143 establishes accounting
     standards for the recognition and measurement of an asset retirement
     obligation and its associated asset retirement cost. It also provides
     accounting guidance for legal obligations associated with the retirement of
     tangible long-lived assets. SFAS 143 is effective for fiscal years
     beginning after June 15, 2002, with early adoption permitted. The Company
     currently is evaluating the provisions of SFAS 143, but expects that the
     provisions will not have a material impact on its consolidated financial
     statements.

          In October 2001, the FASB issued SFAS No. 144, "Accounting for the
     Impairment or Disposal of Long-Lived Assets" (SFAS 144). SFAS 144
     supersedes SFAS 121, but retains its fundamental provisions for the (a)
     recognition/measurement of impairment of long-lived assets to be held and
     used, and (b) measurement of long-lived assets to be disposed of by sale.
     SFAS 144 also supersedes the accounting/reporting provisions of APB No. 30
     for segments of a business to be disposed of, but retains the requirement
     to report discontinued operations separately from continuing operations and
     extends that reporting to a component of an entity that either has been
     disposed of or is classified as held for sale. SFAS 144 became effective
     for DRS on April 1, 2002. The adoption of SFAS 144 did not have an impact
     on the Company's consolidated financial statements.

          In April 2002, the FASB issued Statement No. 145, "Rescission of FASB
     Statements No. 4, 44 and 64, Amendment of FASB Statement No. 13, and
     Technical Corrections" (SFAS 145). SFAS 145 updates, clarifies and
     simplifies existing accounting pronouncements. SFAS 145 rescinds Statement
     No. 4, which required all gains and losses from extinguishment of debt to
     be aggregated and, if material, classified as an extraordinary item, net of
     related income tax effect. As a result, the criteria in Accounting
     Principles Board Opinion No. 30 will now be used to classify those gains
     and losses. Statement No. 44 was issued to establish accounting
     requirements for the effects of transition to provisions of the Motor
     Carrier Act of 1980. Because the transition has been completed, Statement
     No. 44 is no longer necessary. SFAS 145 amends Statement No. 13 to require
     that certain lease modifications that have economic effects similar to
     sale-leaseback transactions be accounted for in the same manner as
     sale-leaseback transactions. This amendment is consistent with the FASB's
     goal of requiring similar accounting treatment for transactions that have
     similar economic effects. SFAS 145 also makes technical corrections to
     existing pronouncements. While those corrections are not substantive in
     nature, in some instances, they may change accounting practice. The Company
     is required to adopt SFAS 145, effective for fiscal 2003. SFAS No. 145 will
     not have a material effect on the Company's consolidated results of
     operations, financial position or cash flows.

          In July 2002, the FASB issued SFAS No. 146, "Accounting for Costs
     Associated with Exit or Disposal Activities" (SFAS 146). SFAS 146 requires
     Companies to recognize costs associated with exit or disposal activities
     when they are incurred rather than at the date of a commitment to an exit
     or disposal plan. Previous accounting guidance was provided by EITF Issue
     No. 94-3, "Liability Recognition for Certain Employee Termination Benefits
     and Other Costs to Exit an Activity (including Certain Costs Incurred in a
     Restructuring)" (EITF 94-3). SFAS 146 replaces EITF 94-3. The Statement is
     to be applied prospectively to exit or disposal activities initiated after
     December 31, 2002. The Company is currently evaluating the provisions of
     the Statement.

                                        9
<Page>

                     DRS TECHNOLOGIES, INC. AND SUBSIDIARIES

     ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
               RESULTS OF OPERATIONS

          The following is management's discussion and analysis (MD&A) of the
     consolidated financial condition and results of operations of DRS
     Technologies, Inc. and Subsidiaries (hereinafter, we, us, our, the Company
     or DRS) as of June 30, 2002, and for the three-month periods ended June 30,
     2002 and 2001. This discussion should be read in conjunction with the
     audited consolidated financial statements and related notes contained in
     our March 31, 2002 Form 10-K.

     FORWARD-LOOKING STATEMENTS

          The following discussion and analysis contains certain forward-looking
     statements, within the meaning of Section 27A of the Securities Act of
     1933, as amended, and Section 21E of the Securities Exchange Act of 1934.
     Forward-looking statements in this report are made pursuant to the safe
     harbor provisions of the Private Securities Litigation Reform Act of 1995.
     Persons reading this report are cautioned that risks and uncertainties are
     inherent to forward-looking statements. Accordingly, our actual results
     could differ materially from those suggested by such forward-looking
     statements. Risks include, without limitation: the effect of our
     acquisition strategy on future operating results, including our ability to
     effectively integrate acquired companies into our existing operations; the
     uncertainty of acceptance of new products and successful bidding for new
     contracts; the effect of technological changes or obsolescence relating to
     our products and services; and the effects of government regulation or
     shifts in government policy, as they may relate to our products and
     services.

     OVERVIEW

          We are a leading supplier of defense electronic products and systems.
     We provide high-technology products and services to all branches of the
     U.S. military, major aerospace and defense prime contractors, government
     intelligence agencies, international military forces and industrial
     markets. Incorporated in 1968, DRS has served the defense industry for over
     thirty years. We are a leading provider of thermal imaging devices, combat
     display workstations, electronic sensor systems, ruggedized computers,
     mission recorders and deployable flight incident recorders. Our products
     are deployed on a wide range of high-profile military platforms, such as
     the DDG-51 Aegis destroyer, the M1A2 Abrams Main Battle Tank, the M2A3
     Bradley Fighting Vehicle, the OH-58D Kiowa Warrior helicopter, the AH-64
     Apache helicopter and the F/A-18E/F Super Hornet jet fighter, as well as in
     other military and non-military applications.

     COMPANY ORGANIZATION AND PRODUCTS

          We operate in three principal operating segments on the basis of
     products and services offered. Each operating segment is comprised of
     separate and distinct businesses: the Electronic Systems Group, the
     Electro-Optical Systems Group and the Flight Safety and Communications
     Group. All other operations are grouped in Other.

          Our Electronic Systems Group (ESG) is a supplier of computer
     workstations used to process and display integrated combat information. ESG
     produces rugged computers and peripherals, surveillance, radar and tracking
     systems, radar support and antennae systems, acoustic signal processing and
     display equipment, and combat control systems. The Group's products are
     used on front-line platforms, including Aegis destroyers and cruisers,
     aircraft carriers, submarines and surveillance aircraft. ESG's products
     also are used in U.S. Army and international battlefield digitization
     programs.

          Our Electro-Optical Systems Group (EOSG) produces systems and
     subsystems for infrared night vision and targeting on the U.S. Army's
     Abrams Main Battle Tanks, Bradley Fighting Vehicles, OH-58D Kiowa Warrior
     helicopters, Aegis destroyers and cruisers, and High-Mobility Multipurpose
     Wheeled Vehicle Scouts. EOSG designs, manufactures and markets these and
     other products that allow operators to detect, identify and target objects
     based upon their infrared signatures, regardless of the ambient light
     level. This Group is one of two key suppliers to the U.S. government for
     advanced focal plane array technology. In addition to military
     applications, EOSG also manufactures electro-optical modules for commercial
     devices used in corrective laser eye surgery and provides system
     integration for retinal scanning and imaging devices.

                                        10
<Page>

                     DRS TECHNOLOGIES, INC. AND SUBSIDIARIES

          Our Flight Safety and Communications Group (FSCG) is a manufacturer of
     airborne deployable recorders and surveillance and communications systems.
     FSCG's products are used by U.S. and international militaries, as well as
     commercial customers. FSCG produces integrated naval ship communications
     systems, information management systems, mission recorders, coastal and
     border radar surveillance systems, ultra high-speed digital imaging systems
     for F/A-18 aircraft and industrial purposes, and multiple-platform weapons
     calibration systems for air platforms, such as the AH-64 Apache attack
     helicopter and the AC-130U gunship. The Group also provides electronics
     manufacturing services to the defense and space industries.

          Other includes the activities of DRS Corporate Headquarters, DRS
     Unmanned Technologies (see Business Combinations and Disposals Below), DRS
     Ahead Technology (for the period it was owned by us during the first
     quarter of fiscal 2003) and certain non-operating subsidiaries of the
     Company. The assets of DRS Ahead Technology were sold on May 27, 2002 (see
     business combinations and disposals below). DRS Unmanned Technologies
     provides close-range, low-weight, low-noise, medium-duration UAVs
     supporting military special operations missions. DRS Ahead Technology
     produces magnetic head components used in the manufacturing process of
     computer disk drives, which burnish and verify the quality of disk
     surfaces. DRS Ahead Technology also services and manufactures magnetic
     video recording heads used in broadcast television equipment.

     BUSINESS COMBINATIONS AND DISPOSALS

          On July 15, 2002, we acquired the assets and assumed certain
     liabilities of the Navy Controls Division of Eaton Corporation for $92.2
     million in cash, subject to adjustment. We financed the acquisition with
     existing cash on hand. Renamed DRS Power & Control Technologies, Inc. (DRS
     PCT) and located in Milwaukee, Wisconsin, and Danbury, Connecticut, the
     company is a leading supplier of high-performance power conversion and
     instrumentation and control systems for the U.S. Navy's combatant fleet,
     including nuclear-powered and conventionally powered ships, as well as to
     specialized industrial customers. Products include ship electric propulsion
     equipment, power electronics equipment, high-performance networks,
     shipboard control equipment and control panels, tactical displays, and
     specialty reactor instrumentation and control equipment. DRS PCT is being
     managed as a part of ESG. DRS PCT's operating results will be included in
     the Company's consolidated results of operations from the date of
     acquisition. The addition of this unit to ESG complements our presence in
     naval advanced command and control computer display and other ship systems.
     DRS PCT has over 600 employees. The acquisition will be accounted for using
     the purchase method of accounting.

          On May 27, 2002, we sold the assets of our DRS Ahead Technology
     operating unit. DRS Ahead Technology produces magnetic head components used
     in the manufacturing process of computer disk drives and manufactures
     magnetic video recording heads used in broadcast television equipment. The
     operating unit recorded $1.3 million of revenue and $0.4 million of
     operating losses for the period it was owned by us during the first quarter
     of fiscal 2003 and $2.2 million of revenue and $0.3 million of operating
     losses for the first quarter of fiscal 2002. The assets of DRS Ahead
     Technology were sold for their aggregate book value, and we received an
     interest bearing promissory note in the amount of $3.1 million as
     consideration for the sale. The note bears interest and is payable over an
     80-month term. No gain or loss was recorded on the sale.

          On April 11, 2002, we acquired the assets of the U.S.-based Unmanned
     Aerial Vehicle (UAV) business of Meggitt Defense Systems - Texas, Inc., a
     unit of Meggitt plc for $0.8 million in cash. The business, located in
     Mineral Wells, Texas and now operating as DRS Unmanned Technologies,
     Inc. provides close-range, low-weight, low-noise, medium-duration UAVs
     supporting military special operations missions. Applications for these
     products include tactical short-range surveillance, radio relay, and
     command, control, communications, computers, intelligence, surveillance and
     reconnaissance. The operations of DRS Unmanned Technologies are not
     significant to our consolidated operating results. The acquisition was
     accounted for using the purchase method of accounting.

                                       11
<Page>

                     DRS TECHNOLOGIES, INC. AND SUBSIDIARIES

     CRITICAL ACCOUNTING POLICIES

          Our consolidated financial statements and accompanying notes are
     prepared in accordance with accounting principles generally accepted in the
     United States of America. Preparing consolidated financial statements
     requires us to make estimates and assumptions that affect the reported
     amounts of assets, liabilities, revenue and expenses. These estimates and
     assumptions are affected by the application of our accounting policies. Our
     significant accounting policies are described in Note 1 to the March 31,
     2002 consolidated financial statements included in our Form 10-K. Critical
     accounting policies are those that require application of management's most
     difficult, subjective or complex judgments, often as a result of matters
     that are inherently uncertain and may change in subsequent periods.
     Critical accounting policies for us include revenue recognition on
     contracts and contract estimates, goodwill and intangible assets,
     long-lived assets and acquired intangible assets, valuation of deferred tax
     assets and liabilities, and management estimates. For additional discussion
     of our critical accounting policies, see our MD&A in our March 31, 2002
     Form 10-K.

     RESULTS OF OPERATIONS

          Our operating cycle is long-term and involves various types of
     production contracts and varying production delivery schedules.
     Accordingly, results of a particular quarter, or quarter-to-quarter
     comparisons of recorded revenues and earnings, may not be indicative of
     future operating results. The following comparative analysis should be
     viewed in this context.

     CONSOLIDATED SUMMARY

     THREE MONTHS ENDED JUNE 30, 2002 COMPARED WITH THREE MONTHS ENDED
     JUNE 30, 2001

          Revenues and operating income for the three months ended June 30, 2002
     were $131.2 million and $12.7 million, respectively, increasing $27.9
     million and $3.0 million, respectively, as compared with the corresponding
     prior-year period. The Electro-Optical Systems Group and Flight Safety and
     Communications Group revenues increased $27.2 million and $4.3 million,
     respectively, and the Electronic Systems Group revenues decreased $3.2
     million. Fiscal 2002 second quarter acquisitions of the Sensors and
     Electronics Systems (SES) business of The Boeing Company (operating as part
     of EOSG) and the Electro Mechanical Systems unit of Lockheed Martin
     (operating as part of ESG) contributed $19.0 million and $3.4 million of
     revenues, respectively, to fiscal 2003 first quarter revenues. The 31%
     increase in operating income was due primarily to the overall increase in
     revenues, partially offset by the impact of certain charges at our
     operating segments (see discussion of operating segments below for
     additional information).

          Interest income increased approximately $0.5 million for the quarter
     ended June 30, 2002, as compared with the prior-year period. The increase
     in interest income reflects a higher average cash and cash equivalents
     balance during the quarter, resulting from our common stock offering in the
     third quarter of fiscal 2002.

          Interest and related expenses increased $0.2 million for the quarter
     ended June 30, 2002, as compared with the corresponding prior-year period.
     The increase in interest expense was attributable to an overall increase in
     term loan borrowings outstanding during the quarter. The increase in our
     term loan borrowings was a result of our fiscal 2002 third quarter
     acquisition of the SES business of The Boeing Company. Partially offsetting
     the increase in interest expense was the favorable impact of an overall
     decrease in weighted average interest rates on our outstanding borrowings
     during the first quarter of fiscal 2003, as compared with the prior-year
     period. Our revolving line of credit borrowings were repaid in the third
     quarter of the prior fiscal year with proceeds from our fiscal 2002 common
     stock offering. As of June 30, 2002, we had no borrowings outstanding under
     our revolving credit facility.

          Minority interest was $0.3 million for the three months ended June 30,
     2002 and 2001. Minority interest is generated by ESG's DRS Laurel
     Technologies unit in which we have an 80% interest.


                                       12
<Page>

                     DRS TECHNOLOGIES, INC. AND SUBSIDIARIES

          The provision for income taxes for the three months ended June 30,
     2002 reflects an annual estimated effective income tax rate of
     approximately 46%, as compared with 47% in the prior-year period. There are
     two primary factors that negatively impact our effective income tax rate;
     losses in ESG's U.K. operation for which the full tax benefit has not been
     recognized, and the effect of non-deductible lobbying expenses. It is
     anticipated that our effective tax rate will continue to decline moderately
     in future years, as we continue to grow.

          Earnings before net interest and related expenses (primarily
     amortization of debt issuance costs), income taxes, depreciation and
     amortization (EBITDA) for the three months ended June 30, 2002 was $15.0
     million, an increase of 22% over the prior-year period. EBITDA is not a
     substitute for operating income, net earnings or cash flows from operating
     activities, as determined in accordance with accounting principles
     generally accepted in the United States of America, or as measures of our
     profitability or liquidity. We present EBITDA as additional information
     because we believe it to be a useful indicator of our ability to meet debt
     service and capital expenditure requirements. EBITDA, as we define it, may
     differ from similarly named measures used by other entities.

     OPERATING SEGMENTS

          The following tables set forth, by operating segment, revenues,
     operating income and operating margin, and the percentage increase or
     decrease of those items as compared with the prior-year period:

<Table>
<Caption>
                                 THREE MONTHS ENDED
                                       JUNE 30,         PERCENT CHANGES
                              -----------------------   ---------------
                                 2002         2001       2002 VS. 2001
                              ----------   ----------   ---------------

                                (IN THOUSANDS, EXCEPT FOR PERCENTAGES)
          <S>                 <C>          <C>                   <C>
          ESG
          External revenues   $   34,911   $   38,079              (8.3%)
          Operating income    $    1,343   $    4,808             (72.1%)
          Operating margin           3.8%        12.6%            (69.8%)
          EOSG
          External revenues   $   68,994   $   41,839              64.9%
          Operating income    $    9,875   $    4,477             120.6%
          Operating margin          14.3%        10.7%             33.6%
          FSCG
          External revenues   $   25,475   $   21,198              20.2%
          Operating income    $    2,257   $      801             181.8%
          Operating margin           8.9%         3.8%            134.2%
          OTHER
          External revenues   $    1,858   $    2,236             (16.9%)
          Operating loss      $     (802)  $     (402)            (99.5%)
          Operating margin         (43.2%)      (18.0%)          (140.0%)
</Table>

                                       13
<Page>


     THREE MONTHS ENDED JUNE 30, 2002 COMPARED WITH THREE MONTHS ENDED JUNE 30,
     2001

     ELECTRONIC SYSTEMS GROUP

                     DRS TECHNOLOGIES, INC. AND SUBSIDIARIES

          Revenues decreased $3.2 million, or 8%, to $34.9 million in the three
     months ended June 30, 2002, as compared with the corresponding prior-year
     period. Operating income decreased $3.5 million, or 72%, to $1.3 million.
     The decrease in revenues was principally attributed to a decrease in sales
     of our rugged computers and peripherals and timing of shipments of combat
     display workstations and components. Partially offsetting the decrease in
     revenues was $4.3 million of revenue contributed by our fiscal 2002 second
     quarter acquisition of the Electro Mechanical Systems unit of Lockheed
     Martin (operating as DRS Surveillance Support Systems). The decrease in
     operating income was driven by the overall decrease in revenues, as well as
     first quarter charges totaling $0.7 million. The charges were associated
     with restructuring efforts at ESG's U.K operating unit, which included
     provisions for inventory and employee severance. We anticipate improvement
     in ESG's operating results throughout the remainder of fiscal 2003, as the
     scheduled volume of shipments on certain key programs increases.
     Additionally, the operating results of the recently completed acquisition
     of the Navy Controls Division of Eaton Corporation (operating as DRS Power
     & Control Technologies) will favorably impact future operating results.

     ELECTRO-OPTICAL SYSTEMS GROUP

          Revenues increased $27.2 million, or 65%, to $69.0 million in the
     three months ended June 30, 2002, as compared with the corresponding
     prior-year period. Operating income increased $5.4 million to $9.9 million.
     The increase in revenues was driven by our fiscal 2002 second quarter
     acquisition of the SES business of The Boeing Company (the SES acquisition)
     and internal growth from our infrared targeting and imaging systems. The
     programs we acquired with the SES acquisition generated $19.0 million of
     revenues in the first quarter of fiscal 2003. Operating income was
     favorably impacted by the internal growth in revenues, as well as $1.5
     million of operating income associated with the SES revenues. Fiscal 2003
     first quarter operating income reflected a charge of $0.3 million primarily
     for legal costs.

     FLIGHT SAFETY AND COMMUNICATIONS GROUP

          Revenues increased $4.3 million, or 20%, to $25.5 million in the three
     months ended June 30, 2002, as compared with the corresponding prior-year
     period. Operating income increased $1.5 million to $2.3 million. The
     revenue growth was a result of greater volume of contract manufacturing
     services and increased shipments of mission data recording systems and
     components. Partially offsetting the revenue increase were decreases in
     sales of data terminal sets and data modems for tactical network
     interconnections. The increase in operating income reflects the overall
     increase in revenues and favorable operating margins due to improved cost
     absorption at the group's U.K operating unit, as well as to a change in
     revenue mix to higher margin programs. Fiscal 2003 first quarter operating
     income reflects a charge of $0.5 million for potential losses associated
     with a certain mission data recording system. Fiscal 2002 first quarter
     operating income included charges of $0.8 million in connection with the
     closing of FSCG's Santa Clara production facility.

     OTHER

          Revenues decreased $0.4 million to $1.9 million in the three months
     ended June 30, 2002. Operating loss increased $0.4 million to $0.8 million.
     The decrease in revenues was attributable to our sale of substantially all
     of the assets and liabilities of DRS Ahead Technology on May 27, 2002,
     partially offset by revenues generated by our April 11, 2002 acquisition of
     the U.S.-based Unmanned Aerial Vehicle (UAV) business of Meggitt Defense
     Systems - Texas, Inc. (now operating as DRS Unmanned Technologies). The
     increase in the operating loss was due to unfavorable operating results at
     DRS Ahead Technology, as well as research and development costs at DRS
     Unmanned Technologies.

     LIQUIDITY AND CAPITAL RESOURCES

          The following table provides our cash flow data for the three months
     ended June 30, 2002 and 2001.

                                       14
<Page>

                     DRS TECHNOLOGIES, INC. AND SUBSIDIARIES

<Table>
<Caption>
                                                                 THREE MONTHS ENDED
                                                                      JUNE 30,
                                                                -------------------
                                                                  2002       2001
                                                                --------   --------
                                                                  (IN THOUSANDS)
          <S>                                                   <C>        <C>
          Net cash provided by operating activities             $  1,080   $  4,557
          Net cash used in investing activities                 $ (4,815)  $ (3,526)
          Net cash provided by (used in) financing activities   $    419   $ (2,306)
</Table>

     OPERATING ACTIVITIES

          For the fiscal quarter ended June 30, 2002, we generated $1.1 million
     of operating cash flow, $3.5 million less than the $4.6 million reported in
     the prior-year period. During the quarter, we paid $2.5 million completing
     a global settlement with the government resolving all potential allegations
     related to their investigation of DRS Photronics (see Part I, Item 3 of our
     March 31, 2002 10-K). Cash provided by earnings, net of adjustments for
     non-cash items, increased $1.0 million to $9.1 million. Increases in our
     net operating assets and liabilities used approximately $8.0 million of
     cash during the quarter, $4.5 million more than the $3.5 million of cash
     used in the prior-year period. During the current quarter, we used cash to
     reduce our accounts payable and other current liabilities. These uses of
     cash were offset, in part, by customer collections and increases in advance
     payments.

     INVESTING ACTIVITIES

          We paid $4.2 million for capital improvements to our manufacturing
     facilities and equipment for the fiscal quarter ended June 2002, as
     compared with $3.5 million for the corresponding prior-year quarter. Of the
     $4.2 million, $2.7 million related to the transfer and integration of
     certain electro-optical system production programs acquired from the SES
     acquisition to our manufacturing centers in Melbourne, Florida and Dallas,
     Texas. We expect that capital expenditures for fiscal 2003 will be between
     $22.0 million and $27.0 million, as we continue to upgrade our facilities
     and integrate the SES business and Navy Controls Division of Eaton
     Corporation into our existing businesses (see below).

          On May 27, 2002, we sold the assets of our DRS Ahead Technology unit
     for $3.1 million and received a $3.1 million interest bearing promissory
     note as consideration. The promissory note bears interest and is payable
     over an 80-month term.

          On July 16, 2002, we completed the acquisition of the assets and
     certain liabilities of the Navy Controls Division of Eaton Corporation for
     $92.2 million in cash.

          Our long-term growth strategy includes a disciplined program of
     acquiring companies that are expected to be accretive to our earnings.
     Continuation of our acquisition program will depend, in part, on the
     availability of financial resources at interest rates and costs of capital
     that are acceptable to us. We would expect to utilize cash generated by
     operations, as well as cash available under our credit facility, which also
     may include the renegotiation of our credit limit to finance such
     acquisitions. Other sources of capital could include proceeds from a sale
     of our common stock and the placement of convertible or high-yield debt. We
     believe that sufficient capital resources will be available to us from one
     or several of these sources to finance future acquisitions that we believe
     to be strategic and accretive to our net earnings. However, no assurances
     can be provided that such financing will be available and at a cost that is
     acceptable to us.

                                       15
<Page>

                     DRS TECHNOLOGIES, INC. AND SUBSIDIARIES

     FINANCING ACTIVITIES

          For the fiscal quarter ended June 2002, financing activities provided
     $0.4 million. Proceeds from short-term borrowings at one of our foreign
     operating subsidiaries and stock option exercises were offset, in part, by
     a payment made on our Term Loan and the early retirement of a property
     mortgage.

          We currently have a $240 million credit agreement with a syndicate of
     lenders, with Wachovia Bank, N.A. as the lead lender, consisting of a term
     loan in the aggregate principal amount of $140 million (Term Loan) and a
     $100 million revolving line of credit (Line of Credit) (collectively
     referred to as the Credit Facility). The maturity dates of the Term Loan
     and the Line of Credit are September 30, 2008 and September 30, 2006,
     respectively. The Term Loan requires quarterly principal payments of
     $350,000, which began on December 31, 2001. Borrowings under the Credit
     Facility bear interest, at our option, at either: a "base rate" (as defined
     in the Credit Agreement) equal to the higher of 0.50% per annum above the
     latest Prime Rate and Federal Funds Rate plus a spread ranging from 1.25%
     to 2.25% per annum, depending on our Total Leverage Ratio (TLR) at the time
     of determination; or a LIBOR rate (as defined in the Credit Agreement) plus
     a spread ranging from 2.25% to 3.25% per annum depending on our TLR. The
     TLR is defined as total debt minus performance-based letters of credit, as
     compared with EBITDA (as defined in the Credit Agreement). The Credit
     Facility is secured by substantially all of our assets. There were no
     borrowings under our revolving line of credit as of June 30, 2002. The
     interest rate on our outstanding Term Loan was approximately 5.3% at June
     30, 2002.

          There are certain covenants and restrictions placed on us under our
     Credit Facility, including a maximum TLR and a minimum fixed-charge ratio,
     a restriction on the payment of dividends on our capital stock, a
     limitation on the issuance of additional debt, a requirement that we offer
     to make prepayments on our term loans outstanding with 50% of the aggregate
     net cash proceeds from any equity offering. Our ability to continue to
     borrow under the Credit Facility will depend upon on our remaining in
     compliance with the limitations imposed by our lenders. We were in
     compliance with all covenants under the Credit Agreement at June 30, 2002.
     As of June 30, 2002, we had approximately $81.4 million of additional
     available credit, after satisfaction of the borrowing base requirement.

          We use "free cash flow" as a measure to evaluate our performance. The
     calculation of free cash flow is net cash provided by operating activities
     less capital expenditures. Free cash flow was a negative $3.1 million for
     the fiscal quarter ended June 30, 2002 and $1.0 million for the
     corresponding quarter in the prior year.

     CONTRACTUAL OBLIGATIONS

          Our contractual obligations and commitments principally include
     obligations associated with our outstanding indebtedness and future minimum
     operating lease obligations as set forth in the table below:

<Table>
<Caption>
                                                        AS OF JUNE 30,2002
                                     --------------------------------------------------------------
                                                       PAYMENTS DUE BY PERIOD
                                     --------------------------------------------------------------
                                                           (in thousands)
                                                   WITHIN 1                               AFTER 5
                                       TOTAL        YEAR        1-3 YEARS    4-5 YEARS     YEARS
                                     ----------   -----------  ----------   ----------   ----------
                                                             (in thousands)
     <S>                             <C>          <C>          <C>          <C>          <C>
     Long-term debt obligations      $  138,950   $    1,400   $    2,800   $    2,800   $  131,950
     Operating lease commitments         81,557       16,164       23,449       19,569       22,375
                                     ----------   ----------   ----------   ----------   ----------

     Total contractual obligations   $  220,507   $   17,564   $   26,249   $   22,369   $  154,325
                                     ==========   ==========   ==========   ==========   ==========
</Table>

                                       16
<Page>

                     DRS TECHNOLOGIES, INC. AND SUBSIDIARIES

          We enter into standby letter of credit agreements with financial
     institutions and customers primarily relating to the guarantee of future
     performance on certain contracts to provide products and services and to
     secure advance payments we have received from customers. At June 30, 2002,
     we had contingent liabilities on outstanding letters of credit as follows:

<Table>
<Caption>
                                           AS OF JUNE 30, 2002
                                 -----------------------------------------
                                    CONTINGENT PAYMENTS DUE BY PERIOD
                                 -----------------------------------------
                                              (in thousands)
                                            WITHIN 1     1-3       AFTER 3
                                  TOTAL      YEAR       YEARS      YEARS
                                 --------   --------   --------   --------
     <S>                         <C>        <C>        <C>        <C>
     Standby letters of credit   $ 18,593   $  5,482   $ 12,911   $    200
</Table>

          Cash and cash equivalents, internally generated cash flow from
     operations and other available financing resources are expected to be
     sufficient to meet anticipated operating, capital expenditure and debt
     service requirements during the next twelve months and the foreseeable
     future. Consistent with our desire to generate cash to invest in our core
     businesses and reduce debt, we anticipate that, subject to prevailing
     financial, market and economic conditions, we may divest certain non-core
     businesses. There can be no assurance, however, that our business will
     continue to generate cash flow at current levels, or that anticipated
     operational improvements will be achieved. If we are unable to generate
     sufficient cash flow from operations to service our debt, we may be
     required to sell assets, reduce capital expenditures, refinance all or a
     portion of our existing debt or obtain additional financing. Our ability to
     make scheduled principal payments or pay interest on or refinance our
     indebtedness depends on our future performance and financial results,
     which, to a certain extent, are subject to general conditions in or
     affecting the defense industry and to general economic, political,
     financial, competitive, legislative and regulatory factors beyond our
     control.

     BACKLOG

          Backlog represents products or services that our customers have
     committed by contract to purchase from us. Our backlog at June 30, 2002 was
     $610.4 million. The backlog at March 31, 2002 was $595.3 million. We booked
     approximately $139.2 million in new orders in the first three months of
     fiscal 2003.

          Our backlog is subject to fluctuations and is not necessarily
     indicative of future sales. Moreover, cancellations of purchase orders or
     reductions of product quantities in existing contracts could substantially
     and materially reduce our backlog and, consequently, future revenues. Our
     failure to replace canceled or reduced backlog could result in lower
     revenues.

     RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

          In June 2001, the FASB issued SFAS No. 143, "Accounting for Retirement
     Obligations" (SFAS 143). SFAS 143 establishes accounting standards for the
     recognition and measurement of an asset retirement obligation and its
     associated asset retirement cost. It also provides accounting guidance for
     legal obligations associated with the retirement of tangible long-lived
     assets. SFAS 143 is effective for fiscal years beginning after June 15,
     2002, with early adoption permitted. We currently are evaluating the
     statement, and we do not expect that the provisions of SFAS 143 will have a
     material impact on our consolidated financial statements.


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                     DRS TECHNOLOGIES, INC. AND SUBSIDIARIES

          In October 2001, the FASB issued SFAS No. 144, "Accounting for the
     Impairment or Disposal of Long-Lived Assets" (SFAS 144). SFAS 144
     supersedes SFAS 121, but retains its fundamental provisions for the (a)
     recognition/measurement of impairment of long-lived assets to be held and
     used, and (b) measurement of long-lived assets to be disposed of by sale.
     SFAS 144 also supersedes the accounting/reporting provisions of Accounting
     Principles Board Opinion (APB) No. 30 for segments of a business to be
     disposed of, but retains the requirement to report discontinued operations
     separately from continuing operations and extends that reporting to a
     component of an entity that either has been disposed of or is classified as
     held for sale. SFAS 144 became effective for us on April 1, 2002. We do not
     expect the adoption of this standard to have a material impact on our
     consolidated financial statements.

          In April 2002, the FASB issued SFAS No. 145, "Rescission of FASB
     Statements No. 4, 44 and 64, Amendment of FASB Statement No. 13, and
     Technical Corrections" (SFAS 145). SFAS 145 updates, clarifies and
     simplifies existing accounting pronouncements. SFAS 145 rescinds Statement
     No. 4, which required all gains and losses from extinguishment of debt to
     be aggregated and, if material, classified as an extraordinary item, net of
     related income tax effect. As a result, the criteria in APB No. 30 will now
     be used to classify those gains and losses because Statement No. 4 has been
     rescinded. Statement No. 44 was issued to establish accounting requirements
     for the effects of transition to provisions of the Motor Carrier Act of
     1980. Because the transition has been completed, Statement No. 44 is no
     longer necessary. SFAS 145 amends Statement No.13 to require that certain
     lease modifications that have economic effects similar to sale-leaseback
     transactions be accounted for in the same manner as sale-leaseback
     transactions. This amendment is consistent with the FASB's goal of
     requiring similar accounting treatment for transactions that have similar
     economic effects. SFAS 145 also makes technical corrections to existing
     pronouncements. While those corrections are not substantive in nature, in
     some instances, they may change accounting practice. We are required to
     adopt SFAS 145, effective for fiscal 2003. SFAS No. 145 will not have a
     material effect on our consolidated results of operations, financial
     position or cash flows.

          In July 2002, the FASB issued SFAS No. 146, "Accounting for Costs
     Associated with Exit or Disposal Activities" (SFAS 146). SFAS 146 requires
     companies to recognize costs associated with exit or disposal activities
     when they are incurred rather than at the date of a commitment to an exit
     or disposal plan. Previous accounting guidance was provided by EITF Issue
     No. 94-3, "Liability Recognition for Certain Employee Termination Benefits
     and Other Costs to Exit an Activity (including Certain Costs Incurred in a
     Restructuring)" (EITF 94-3). SFAS 146 replaces EITF 94-3. The Statement is
     to be applied prospectively to exit or disposal activities initiated after
     December 31, 2002. We are currently evaluating the provisions of the
     Statement.

     ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

          See Part II, Item 7A, "Quantitative and Qualitative Disclosures About
     Market Risk", of our Annual Report on Form 10-K for the fiscal year ended
     March 31, 2002 for a discussion of our exposure to market risks. There was
     no significant change in those risks during the three months ended June 30,
     2002, except for interest rate risk.

          We currently have a $240 million credit agreement with Wachovia Bank,
     N.A. as the lead bank, consisting of a term loan in the aggregate principal
     amount of $140 million (Term Loan) and a $100 million revolving line of
     credit (Line of Credit) (collectively referred to as the Credit Facility).
     Borrowings under the Credit Facility bear interest based on LIBOR (London
     Interbank Offered Rate), United States Prime Rate or United States Federal
     Funds Rate. Therefore, we are exposed to interest rate risk on our variable
     rate borrowings. Although there were no borrowings outstanding under our
     Line of Credit as of June 30, 2002, we had $139 million outstanding under
     our Term Loan. Excluding the notional amounts covered under our interest
     rate collar agreements, a 12.5 basis point increase/decrease in interest
     rates would have resulted in an increase/decrease in interest expense of
     $37,000 for the three-month period ended June 30, 2002.

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                     DRS TECHNOLOGIES, INC. AND SUBSIDIARIES

     PART II.  OTHER INFORMATION

          ITEM 1.    LEGAL PROCEEDINGS

          We are party to various legal actions and claims arising in the
     ordinary course of our business. In our opinion, we have adequate legal
     defenses for each of the actions and claims, and we believe that their
     ultimate disposition will not have a material adverse effect on our
     consolidated financial position or results of operations.

          We currently are involved in a dispute with Spar Aerospace Ltd. (Spar)
     with respect to the working capital adjustment, if any, provided for in the
     purchase agreement between us and Spar dated as of September 19, 1997,
     pursuant to which we acquired, through certain of our subsidiaries, certain
     assets of Spar. On January 11, 2002, we were notified that an arbitrator
     awarded Spar $4,616,000 Canadian (or approximately $2,890,000 U.S.) plus
     interest in respect of such working capital adjustment. As of March 31,
     2002, we had accrued approximately $3.9 million, including interest,
     associated with the potential award. On February 5, 2002, we filed a notice
     of appeal of such arbitral award with the Ontario Superior Court of
     Justice. The appeal currently is scheduled to be heard in September 2002.

          On October 3, 2001, a lawsuit was filed in the United States District
     Court for the Eastern District of New York by Miltope Corporation, a
     corporation of the State of Alabama, and IV Phoenix Group, Inc., a
     corporation of the State of New York, against DRS Technologies, Inc., DRS
     Electronic Systems, Inc. and a number of individual defendants, several of
     whom are employed by DRS Electronic Systems. The plaintiffs allege claims
     against us of infringement of a number of patents, breach of a
     confidentiality agreement, misappropriation of trade secrets, unjust
     enrichment and unfair competition. The claims relate generally to the
     activities of certain former employees of IV Phoenix Group and the hiring
     of some of those employees by us. The plaintiffs seek damages of not less
     than $5.0 million for each of the claims. The plaintiffs also allege claims
     for tortious interference with business relationships, tortious
     interference with contracts and conspiracy to breach fiduciary duty. The
     plaintiffs seek damages of not less than $47.1 million for each such claim.
     In addition, plaintiffs seek punitive and treble damages, injunctive relief
     and attorneys' fees. In our answer, we have denied the plaintiffs'
     allegations, and we intend to vigorously defend this action. In February
     2002, plaintiffs filed an amended complaint, which eliminated the patent
     infringement claims and added claims related to statutory and common law
     trademark infringement. Although this action is in its early stages, we
     believe we have meritorious defenses and do not believe the action will
     have a material adverse effect on our earnings or financial condition.

     ITEM 6.    EXHIBITS AND REPORTS ON FORM 8-K

                (a)    Exhibits

          Exhibit No.  Description
          -----------  -----------

          99.1         Certification of CEO Pursuant to 18 U.S.C. Section 1350,
                       as Adopted Pursuant to Section 906 of the Sarbanes-Oxley
                       Act of 2002

          99.2         Certification of CFO Pursuant to 18 U.S.C. Section 1350,
                       as Adopted Pursuant to Section 906 of the Sarbanes-Oxley
                       Act of 2002

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                     DRS TECHNOLOGIES, INC. AND SUBSIDIARIES


                (b)    Reports on Form 8-K

                The following report on form 8-K was filed during the quarter
                ending September 30, 2002:

                   1.  Form 8-K filed on July 30, 2002, in connection with DRS
                       Technologies, Inc.'s acquisition of the assets and
                       certain liabilities of the Navy Controls Division of
                       Eaton Corporation.

                                   SIGNATURES

     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 thereunto duly authorized.

                                       Drs Technologies, Inc.
                                       ----------------------
                                              Registrant


     Date: August 14, 2002             /s/ Richard A. Schneider
                                       -----------------------------------------
                                       Richard A. Schneider
                                       EXECUTIVE VICE PRESIDENT, CHIEF FINANCIAL
                                       OFFICER AND TREASURER

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