UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C.   20549

_________________

FORM 10-Q

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

For the quarterly period ended
April 29, 2005

OR

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

For the transition period from _____________________ to ________________________

Commission file number  1-6357

ESTERLINE TECHNOLOGIES CORPORATION
(Exact name of registrant as specified in its charter)

| |                                                                        |  |                                                | 
| | ---------------------------------------------------------------------- |  | ---------------------------------------------- | 
| | Delaware
(State or other Jurisdictionof incorporation or organization) |  | 13-2595091
(I.R.S. EmployerIdentification No.) | 

500  108th Avenue NE, Bellevue, Washington  98004
(Address of principal executive offices)    (Zip Code)

Registrants
telephone number, including area code 425/453-9400

Indicate by check mark whether the
registrant:  (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.

Yes   X    
No

Indicate by check mark whether the
registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

Yes   X    
No

As of June 3, 2005,
25,181,597 shares of the issuers common stock were outstanding.






# PART 1  FINANCIAL
INFORMATION

# Item 1.        
  Financial
 Statements

ESTERLINE TECHNOLOGIES
CORPORATIONCONSOLIDATED BALANCE SHEETAs of
April 29, 2005 and October 29, 2004(In thousands, except
share amounts)

|                                        | April 29,
2005 |  | October 29,
2004 |            
|--------------------------------------- | -------------- |  | ---------------- | -----------
|ASSETS                                  |                |  |                  | (Unaudited)
|                                        |                |  |                  |            
|Current Assets                          |                | 
|Cash and cash equivalents               |                |  | $                | 137,704    
|Cash in escrow                          |                |  |                  | 7,537      
|Short-term investments                  |                |  |                  | 45,486     
|Accounts receivable, net of allowances  |                | 
|of $4,163 and $3,687                    |                |  |                  | 128,212    
|Inventories                             |                | 
|Raw materials and purchased parts       |                |  |                  | 67,288     
|Work in process                         |                |  |                  | 46,324     
|Finished goods                          |                |  |                  | 18,485     
|                                        |                |  |                  |            
|                                        |                |  |                  | 132,097    
|                                        |                |  |                  |            
|Deferred income tax benefits            |                |  |                  | 22,324     
|Prepaid expenses                        |                |  |                  | 8,733      
|Other current assets                    |                |  |                  | 288        
|                                        |                |  |                  |            
|Total Current Assets                    |                |  |                  | 482,381    
|                                        |                |  |                  |            
|Property, Plant and Equipment           |                |  |                  | 273,817    
|Accumulated depreciation                |                |  |                  | 136,468    
|                                        |                |  |                  |            
|                                        |                |  |                  | 137,349    
|                                        |                |  |                  |            
|Other Non-Current Assets                |                | 
|Goodwill                                |                |  |                  | 246,032    
|Intangibles, net                        |                |  |                  | 166,593    
|Debt issuance costs, net of accumulated |                | 
|amortization of $1,265 and $928         |                |  |                  | 5,481      
|Deferred income tax benefits            |                |  |                  | 9,986      
|Other assets                            |                |  |                  | 28,266     
|                                        |                |  |                  |            
|                                        |                |  | $                | 1,076,088  
|                                        |                |  |                  |            

-2-

---

ESTERLINE TECHNOLOGIES
CORPORATIONCONSOLIDATED BALANCE SHEETAs of
April 29, 2005 and October 29, 2004(In thousands, except
share amounts)

|                                             | April 29,
2005 |  | October 29,
2004 |            
|-------------------------------------------- | -------------- |  | ---------------- | -----------
|LIABILITIES AND SHAREHOLDERS EQUITY         |                |  |                  | (Unaudited)
|                                             |                |  |                  |            
|Current Liabilities                          |                | 
|Accounts payable                             |                |  | $                | 42,387     
|Accrued liabilities                          |                |  |                  | 95,388     
|Credit facilities                            |                |  |                  | 2,567      
|Current maturities of long-term debt         |                |  |                  | 30,901     
|Federal and foreign income taxes             |                |  |                  | 7,213      
|                                             |                |  |                  |            
|Total Current Liabilities                    |                |  |                  | 178,456    
|                                             |                |  |                  |            
|Long-Term Liabilities                        |                | 
|Long-term debt, net of current maturities    |                |  |                  | 217,722    
|Deferred income taxes                        |                |  |                  | 45,280     
|Other liabilities                            |                |  |                  | 26,185     
|                                             |                |  |                  |            
|Commitments and Contingencies                |                |  |                  |           
|                                             |                |  |                  |            
|Minority Interest                            |                |  |                  | 2,427      
|                                             |                |  |                  |            
|Shareholders Equity                         |                | 
|Common stock, par value $.20 per share,      |                | 
|authorized 60,000,000 shares, issued and     |                | 
|outstanding 25,154,109 and 21,319,698 shares |                |  |                  | 5,031      
|Additional paid-in capital                   |                |  |                  | 231,130    
|Retained earnings                            |                |  |                  | 340,428    
|Accumulated other comprehensive income       |                |  |                  | 29,429     
|                                             |                |  |                  |            
|Total Shareholders Equity                   |                |  |                  | 606,018    
|                                             |                |  |                  |            
|                                             |                |  | $                | 1,076,088  
|                                             |                |  |                  |            

-3-

---



ESTERLINE TECHNOLOGIES
CORPORATION CONSOLIDATED STATEMENT OF
OPERATIONSFor the Three and Six Month Periods Ended April 29, 2005 and
April 30, 2004(Unaudited)(In thousands, except
per share amounts)

|                                  | Three Months Ended |  | Six Months Ended |        
|--------------------------------- | ------------------ |  | ---------------- | -------
|
|                                  |                    |  |                  |        
|Net Sales                         |                    |  | $                | 211,592
|Cost of Sales                     |                    |  |                  | 143,054
|                                  |                    |  |                  |        
|                                  |                    |  |                  | 68,538 
|Expenses                          |                    | 
|Selling, general & administrative |                    |  |                  | 34,455 
|Research, development &           |                    | 
|engineering                       |                    |  |                  | 9,866  
|                                  |                    |  |                  |        
|Total Expenses                    |                    |  |                  | 44,321 
|                                  |                    |  |                  |        
|                                  |                    |  |                  |        
|Operating Earnings From           |                    | 
|Continuing Operations             |                    |  |                  | 24,217 
|                                  |                    |  |                  |        
|Other (income) expense            |                    |  |                  | 28     
|Interest income                   |                    |  |                  | (1,025 
|Interest expense                  |                    |  |                  | 4,097  
|                                  |                    |  |                  |        
|Other Expense, Net                |                    |  |                  | 3,100  
|                                  |                    |  |                  |        
|                                  |                    |  |                  |        
|Income From Continuing Operations |                    | 
|Before Income Taxes               |                    |  |                  | 21,117 
|Income Tax Expense                |                    |  |                  | 6,415  
|                                  |                    |  |                  |        
|Income From Continuing Operations |                    | 
|Before Minority Interest          |                    |  |                  | 14,702 
|                                  |                    |  |                  |        
|Minority Interest                 |                    |  |                  | (35    
|                                  |                    |  |                  |        
|Income From Continuing Operations |                    |  |                  | 14,667 
|                                  |                    |  |                  |        
|Income (Loss) From Discontinued   |                    | 
|Operations, Net of Tax            |                    |  |                  | (562   
|                                  |                    |  |                  |        
|                                  |                    |  |                  |        
|Net Earnings                      |                    |  | $                | 14,105 
|                                  |                    |  |                  |        

-4-

---

ESTERLINE TECHNOLOGIES CORPORATION
CONSOLIDATED STATEMENT OF OPERATIONSFor the Three and Six Month Periods Ended
April 29, 2005 and April 30, 2004(Unaudited)(In thousands, except per share amounts)

|                                     | Three Months Ended |  | Six Months Ended |     
|------------------------------------ | ------------------ |  | ---------------- | ----
|
|Earnings (Loss) Per Share  Basic:   |                    |  |                  |     
|Continuing operations                |                    |  | $                | .58 
|Discontinued operations              |                    |  |                  | (.02
|                                     |                    |  |                  |     
|Earnings per share  basic           |                    |  | $                | .56 
|                                     |                    |  |                  |     
|                                     |                    |  |                  |     
|Earnings (Loss) Per Share  Diluted: |                    | 
|Continuing operations                |                    |  | $                | .58 
|Discontinued operations              |                    |  |                  | (.03
|                                     |                    |  |                  |     
|Earnings per share  diluted         |                    |  | $                | .55 
|                                     |                    |  |                  |     

-5-

---

ESTERLINE TECHNOLOGIES
CORPORATIONCONSOLIDATED STATEMENT OF
CASH FLOWSFor the Six Month
Periods Ended April 29, 2005 and April 30, 2004(Unaudited)(In thousands)

|                                                       | Six Months Ended | 
|------------------------------------------------------ | ---------------- | 
|
|Cash Flows Provided (Used) by Operating Activities     |                  | 
|Net earnings                                           |                  | 
|Minority interest                                      |                  | 
|Depreciation and amortization                          |                  | 
|Deferred income taxes                                  |                  | 
|Gain on sale of discontinued operations                |                  | 
|Loss on sale of building                               |                  | 
|Gain on sale of land                                   |                  | 
|Working capital changes, net of effect of acquisitions |                  | 
|Accounts receivable                                    |                  | 
|Inventories                                            |                  | 
|Prepaid expenses                                       |                  | 
|Accounts payable                                       |                  | 
|Accrued liabilities                                    |                  | 
|Federal and foreign income taxes                       |                  | 
|Other liabilities                                      |                  | 
|Other, net                                             |                  | 
|                                                       |                  | 
|                                                       |                  | 
|                                                       |                  | 
|Cash Flows Provided (Used) by Investing Activities     |                  | 
|Purchases of capital assets                            |                  | 
|Proceeds from sale of discontinued operations          |                  | 
|Proceeds from sale of building                         |                  | 
|Proceeds from sale of land                             |                  | 
|Capital dispositions                                   |                  | 
|Purchase of short-term investments                     |                  | 
|Acquisitions of businesses, net of cash acquired       |                  | 
|                                                       |                  | 
|                                                       |                  | 

-6-

---

ESTERLINE TECHNOLOGIES
CORPORATIONCONSOLIDATED STATEMENT OF
CASH FLOWSFor the Six Month
Periods Ended April 29, 2005 and April 30, 2004(Unaudited)(In thousands)

|                                                     | Six Months Ended | 
|---------------------------------------------------- | ---------------- | 
|
|Cash Flows Provided (Used) by Financing Activities   |                  | 
|Proceeds provided by stock issuance under            |                  | 
|employee stock plans                                 |                  | 
|Proceeds provided by sale of common stock            |                  | 
|Net change in credit facilities                      |                  | 
|Repayment of long-term obligations                   |                  | 
|Debt and other issuance costs                        |                  | 
|                                                     |                  | 
|                                                     |                  | 
|                                                     |                  | 
|Effect of Foreign Exchange Rates on Cash             |                  | 
|                                                     |                  | 
|Net Increase (Decrease) in Cash and Cash Equivalents |                  | 
|                                                     |                  | 
|Cash and Cash Equivalents  Beginning of Period      |                  | 
|                                                     |                  | 
|Cash and Cash Equivalents  End of Period            |                  | 
|                                                     |                  | 
|                                                     |                  | 
|Supplemental Cash Flow Information                   |                  | 
|Cash Paid for Interest                               |                  | 
|Cash Paid for Taxes                                  |                  | 

-7-

---

ESTERLINE TECHNOLOGIES
CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTSFor the Three and Six Month Periods Ended
April 29, 2005 and April 30, 2004

|1. | The consolidated balance sheet as of April 29, 2005, the consolidated
          statement of operations for the three and six month periods ended
          April 29, 2005 and April 30, 2004, and the consolidated
          statement of cash flows for the six month periods ended April 29, 2005
          and April 30, 2004 are unaudited, but in the opinion of management,
          all of the necessary adjustments, consisting of normal recurring accruals, have
          been made to present fairly the financial statements referred to above in
          accordance with generally accepted accounting principles for interim financial
          information and with the instructions to Form 10-Q and Article 10 of
          Regulation S-X. Accordingly, the above statements do not include all of the
          footnotes required for complete financial statements. The results of operations
          and cash flows for the interim periods presented are not necessarily indicative
          of results that can be expected for the full year.
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|2. | The notes to the consolidated financial statements in the Companys Annual
          Report on Form 10-K for the fiscal year ended October 29, 2004
          provide a summary of significant accounting policies and additional financial
          information that should be read in conjunction with this Form 10-Q.
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|3. | The timing of the Companys revenues is impacted by the purchasing patterns
          of customers and, as a result, revenues are not generated evenly throughout the
          year. Moreover, the Companys first fiscal quarter, November through
          January, includes significant holiday vacation periods in both Europe and North
          America.
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|4. | Basic earnings per share is computed on the basis of the weighted average number
          of shares outstanding during the period. Diluted earnings per share includes the
          dilutive effect of stock options. The weighted average number of shares
          outstanding used to compute basic earnings per share was 25,120,000 and
          21,167,000 for the three month periods ended April 29, 2005 and
          April 30, 2004, respectively. The weighted average number of shares
          outstanding used to compute diluted earnings per share was 25,484,000 and
          21,495,000 for the three month periods ended April 29, 2005 and
          April 30, 2004, respectively. The weighted average number of shares
          outstanding used to compute basic earnings per share was 24,577,000 and
          21,133,000 for the six month periods ended April 29, 2005, and
          April 30, 2004, respectively. The weighted average number of shares
          outstanding used to compute diluted earnings per share was 24,953,000 and
          21,466,000 for the six month periods ended April 29, 2005 and
          April 30, 2004, respectively.
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|5. | In December 2004, the Financial Accounting Standards Board issued Statement
          of Financial Accounting Standards No. 123R, Share-Based Payment
          (Statement No. 123R), which is effective for the Company no later than the
          beginning of its first fiscal quarter of 2006. This statement will have a
          significant impact on the Companys consolidated statements of operations,
          as the Company will be required to expense the fair value of its stock option
          grants and stock purchases under its employee stock purchase plan rather than
          disclose the
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

-8-

---

| | impact on the consolidated net income within the footnotes as is
          the Companys current practice. Management intends to comply with the
          standard at the beginning of our first fiscal quarter of 2006. The impact of
          adoption cannot be predicted at this time because it will depend on levels of
          share-based payments granted in the future. However, had we adopted Statement
          No. 123R in prior periods, the impact of that standard would have
          approximated the impact of Statement No. 123 as described in the disclosure
          of pro forma net income and earnings per share under Note 9.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|6. | The Companys comprehensive income is as follows:
|-- | -------------------------------------------------

| | (In thousands)
| | --------------

| |  | Three Months Ended |                                    | Six Months Ended | 
| |  | ------------------ | ---------------------------------- | ---------------- | 
|
| |  |                    |                                    |                  | 
| |  |                    | Net Earnings                       |                  | 
| |  |                    | Change in Fair Value of Derivative |                  | 
| |  |                    | Financial Instruments, Net of Tax  |                  | 
| |  |                    | Foreign Currency Translation Adj   |                  | 
| |  |                    |                                    |                  | 
| |  |                    | Comprehensive Income               |                  | 
| |  |                    |                                    |                  | 

|7. | On January 28, 2005, the Company completed the sale of the outstanding
          stock of its wholly owned subsidiary Fluid Regulators Corporation (Fluid
          Regulators), which was included in the Companys Sensors & Systems
          segment, for approximately $23.7 million. As a result of the sale, the
          Company recorded a gain of $7.0 million, net of tax of $2.4 million.
          Sales and net earnings were $3.5 million and $0.3 million, respectively, during the
          three month period ended April 30, 2004. Sales and net earnings were
          $3.4 million and $0.3 million, respectively, during the six month
          period ended April 29, 2005 and $6.6 million and
          $0.7 million, respectively, during the six month period ended
          April 30, 2004.
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | On
July 25, 2002, the Board of Directors adopted a formal plan for the sale of the
assets and operations of its former Automation segment. On July 23, 2003, the
Company sold the assets of its Excellon Automation subsidiary. On
August 31, 2004, the Company sold the stock of W. A. Whitney for
$10.0 million in cash. Upon the final disposition of its discontinued Automation
operations in the fourth fiscal quarter of 2004, the Company recorded an $8.0 million
gain, net of $4.5 million in tax, including the reversal of estimated reserves which
were recognizable upon sale of the business. Sales in the Automation segment were
$5.7 million and $10.3 million for the three month and six month period ended
April 30, 2004, respectively.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | On
May 13, 2005, management closed a small unit in the Companys Other segment
and incurred $0.4 million in severance, net of $0.2 million in tax, in the
second quarter of fiscal 2005.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

-9-

---

| | The dispositions and closure described above are reported as discontinued operations and the
consolidated financial statements for all prior periods have been adjusted to reflect this
presentation.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|8. | The effective tax rate for the first six months of fiscal 2005 was 29.4%, compared with
          30.3% (before a $1.9 million reduction of previously estimated tax
          liabilities) for the first six months of fiscal 2004. The effective tax rate differed
          from the statutory rate, as both years benefited from various tax credits and
          benefits. On February 4, 2004, the Company received a Notice of
          Proposed Adjustment (NOPA) from the Internal Revenue Service covering the audit
          of research and development tax credits for fiscal years 1997 through 1999. As a
          result of the NOPA and the expectation of a similar result for fiscal years 2000
          through 2003, management revised the Companys estimated liability for
          income taxes as of January 30, 2004. The revision resulted in a
          $1.9 million reduction of previously estimated tax liabilities.
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|9. | The Company follows Accounting Principles Board Opinion No. 25,
          Accounting for Stock Issued to Employees, to account for stock
          option and employee stock purchase plans, which does not require income
          statement recognition of options granted at the market price on the date of
          issuance. The following table illustrates the effect on net income and earnings
          per share as if the Company had applied the fair value recognition provisions of
          Statement of Financial Accounting Standards No. 123 (FAS 123 Adjustment),
          Accounting for Stock-Based Compensation (Statement No. 123):
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (In thousands, except per share amounts)
| | ----------------------------------------

| |  | Three Months Ended |                                       | Six Months Ended | 
| |  | ------------------ | ------------------------------------- | ---------------- | 
|
| |  |                    |                                       |                  | 
| |  |                    | Net earnings, as reported             |                  | 
| |  |                    | Deduct:  FAS 123 Adjustment           |                  | 
| |  |                    |                                       |                  | 
| |  |                    | Pro forma net earnings                |                  | 
| |  |                    |                                       |                  | 
| |  |                    |                                       |                  | 
| |  |                    | Basic earnings per share, as reported |                  | 
| |  |                    | Deduct:  FAS 123 Adjustment           |                  | 
| |  |                    |                                       |                  | 
| |  |                    | Pro forma basic earnings per share    |                  | 
| |  |                    |                                       |                  | 
| |  |                    |                                       |                  | 
| |  |                    | Diluted earnings per share,           |                  | 
| |  |                    | as reported                           |                  | 
| |  |                    | Deduct:  FAS 123 Adjustment           |                  | 
| |  |                    |                                       |                  | 
| |  |                    | Pro forma diluted earnings per share  |                  | 
| |  |                    |                                       |                  | 

-10-

---

|10. | The Companys pension plans principally include a U.S. pension plan maintained by Esterline and U.S. and non-U.S.
plans maintained by Leach Holding Corporation. Components of net periodic pension cost consisted of the following:
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (In thousands)
| | --------------

| |  | Three Months Ended |                                         | Six Months Ended | 
| |  | ------------------ | --------------------------------------- | ---------------- | 
|
| |  |                    | Components of Net Periodic Pension Cost |                  | 
| |  |                    | Service cost                            |                  | 
| |  |                    | Interest cost                           |                  | 
| |  |                    | Expected return on plan assets          |                  | 
| |  |                    | Amortization of prior                   |                  | 
| |  |                    | service cost                            |                  | 
| |  |                    | Amortization of actuarial loss          |                  | 
| |  |                    |                                         |                  | 
| |  |                    | Net Periodic Cost                       |                  | 
| |  |                    |                                         |                  | 

|11. | Segment information:
|--- | --------------------

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

| | (In thousands)
| | --------------

| |  | Three Months Ended |                                   | Six Months Ended | 
| |  | ------------------ | --------------------------------- | ---------------- | 
|
| |  |                    | Sales                             |                  | 
| |  |                    | Avionics & Controls               |                  | 
| |  |                    | Sensors & Systems                 |                  | 
| |  |                    | Advanced Materials                |                  | 
| |  |                    |                                   |                  | 
| |  |                    | Total Sales                       |                  | 
| |  |                    |                                   |                  | 
| |  |                    |                                   |                  | 
| |  |                    | Income from Continuing Operations |                  | 
| |  |                    | Avionics & Controls               |                  | 
| |  |                    | Sensors & Systems                 |                  | 
| |  |                    | Advanced Materials                |                  | 
| |  |                    |                                   |                  | 
| |  |                    | Segment Earnings                  |                  | 
| |  |                    |                                   |                  | 
| |  |                    | Corporate expense                 |                  | 
| |  |                    | Other income (expense)            |                  | 
| |  |                    | Interest income                   |                  | 
| |  |                    | Interest expense                  |                  | 
| |  |                    |                                   |                  | 
| |  |                    |                                   |                  | 
| |  |                    |                                   |                  | 

-11-

---

|12. | On December 1, 2003, the Company acquired all of the outstanding
          capital stock of AVISTA, Incorporated (AVISTA), a $10 million (sales)
          Wisconsin-based developer of embedded avionics software, for approximately
          $6.5 million in cash. A purchase price adjustment was paid to the seller in
          December 2004 and an additional amount will be paid in December 2005
          contingent upon the achievement of financial results as defined in the Stock
          Purchase Agreement. The December 2004 purchase price adjustment was
          approximately $3.3 million. AVISTA provides a software engineering center
          to support the Companys customers with such applications as primary flight
          displays, flight management systems, air data computers and engine control
          systems. AVISTA is included in the Avionics & Controls segment and the
          results of its operations were included from the effective date of the
          acquisition. Revenues are largely fees charged for software engineering
          services.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|13. | On November 24, 2004, the Company
completed a public offering of 3.7 million shares of common stock, including shares sold under the underwriters
over-allotment option, priced at $31.25 per share, generating net proceeds of approximately $109 million, of which
$5.0 million was used to pay off existing credit facilities. The funds provide additional financial resources for
acquisitions and general corporate purposes. The Company issued 154,411 and 105,954 shares under its employee stock plans
during the six month periods ended April 29, 2005 and April 30, 2004, respectively.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|14. | The following schedules set forth condensed consolidating financial information
          as required by Rule 3-10 of Securities and Exchange Commission
          Regulation S-X for the periods ended April 29, 2005, and
          April 30, 2004, for (a) Esterline Technologies Corporation (the
          Parent); (b) on a combined basis, the subsidiary guarantors (Guarantor
          Subsidiaries) of the Senior Subordinated Notes which include Advanced Input
          Devices, Inc., Amtech Automated Manufacturing Technology, Angus
          Electronics Co., Armtec Countermeasures Co., Armtec Defense
          Products Co., Auxitrol Co., AVISTA, Incorporated, Boyar-Schultz
          Corporation, BVR Technologies Co., Equipment Sales Co., EA
          Technologies Corporation, Esterline Technologies Holdings Limited, H.A.
          Sales Co., Hauser Inc., Hytek Finishes Co., Janco Corporation,
          Kirkhill-TA Co., Korry Electronics Co., Leach Holding Corporation,
          Leach International Corporation, Leach Technology Group, Inc., Mason
          Electric Co., MC Tech Co., Memtron Technologies Co., Norwich Aero
          Products, Inc., Pressure Systems, Inc., Pressure Systems
          International, Inc., Surftech Finishes Co., UMM Electronics Inc., and
          (c) on a combined basis, the subsidiary non-guarantors (Non-Guarantor
          Subsidiaries), which include Advanced Input Devices Ltd.
          (England), Auxitrol S.A., Auxitrol Technologies S.A., Auxitrol Asia
          PTE Ltd., Esterline Input Devices Asia Ltd., Esterline Input Devices
          Ltd. (China), Esterline Technologies DK Aps (Denmark), Esterline
          Technologies Ltd. (England), Esterline Technologies Ltd. (Hong Kong),
          Excellon Europa GmbH, Excellon France S.A.R.L., Guizhou Leach-Tianyi
          Aviation Electrical Company Ltd. (China), Leach International Asia-Pacific Ltd.
          (Hong Kong), Leach International Europe S.A. (France), Leach International
          Germany GmbH (Germany), Leach International Mexico S. de R.L. de C.V. (Mexico),
          Leach International U.K. (England), LRE Medical GmbH (Germany), Muirhead
          Aerospace Ltd., Norcroft Dynamics Ltd., Pressure Systems International
          Ltd., TA Mfg. Limited, Weston Aero Ltd. (England), and Weston Aerospace
          Ltd. (England). The guarantor subsidiaries are direct
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

-12-

---

| | and indirect wholly-owned
          subsidiaries of Esterline Technologies and have fully and unconditionally,
          jointly and severally, guaranteed the Senior Subordinated Notes.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

-13-

---

Condensed Consolidating Balance Sheet
as of April 29, 2005.

(In thousands)

|                                 | Parent |  | Guarantor
Subsidiaries |         | Non-
Guarantor
Subsidiaries |   | Eliminations |  | Total |        
|-------------------------------- | ------ |  | ---------------------- | ------- | --------------------------- | - | ------------ |  | ----- | -------
|
|Assets                           |        |  |                        |         |                             |   |              |  |       |        
|                                 |        | 
|Current Assets                   |        | 
|Cash and cash equivalents        |        |  | $                      | 100,208 |                             | $ | 1,592        |  | $     | 35,904 
|Cash in escrow                   |        |  |                        | 7,537   |                             |   |             |  |       |       
|Short-term investments           |        |  |                        | 45,486  |                             |   |             |  |       |       
|Accounts receivable, net         |        |  |                        | 672     |                             |   | 73,433       |  |       | 54,107 
|Inventories                      |        |  |                        |        |                             |   | 85,101       |  |       | 46,996 
|Deferred income tax benefits     |        |  |                        | 37,124  |                             |   |             |  |       | (14,800
|Prepaid expenses                 |        |  |                        | 246     |                             |   | 5,427        |  |       | 3,060  
|Other current assets             |        |  |                        |        |                             |   | 288          |  |       |       
|                                
|Total Current Assets             |        |  |                        | 191,273 |                             |   | 165,841      |  |       | 125,267
|                                 |        | 
|Property, Plant & Equipment, Net |        |  |                        | 2,367   |                             |   | 93,383       |  |       | 41,599 
|Goodwill                         |        |  |                        |        |                             |   | 172,415      |  |       | 73,617 
|Intangibles, Net                 |        |  |                        | 141     |                             |   | 74,258       |  |       | 92,194 
|Debt Issuance Costs, Net         |        |  |                        | 5,481   |                             |   |             |  |       |       
|Deferred Income Tax Benefits     |        |  |                        | 9,986   |                             |   |             |  |       |       
|Other Assets                     |        |  |                        | 4,108   |                             |   | 18,407       |  |       | 5,751  
|Amounts Due (To) From            |        | 
|Subsidiaries                     |        |  |                        | 118,913 |                             |   | 79,650       |  |       |       
|Investment in Subsidiaries       |        |  |                        | 597,634 |                             |   |             |  |       |       
|                                
|Total Assets                     |        |  | $                      | 929,903 |                             | $ | 603,954      |  | $     | 338,428
|                                

-14-

---

(In thousands)

|                                     | Parent |  | Guarantor
Subsidiaries |         | Non-
Guarantor
Subsidiaries |   | Eliminations |  | Total |        
|------------------------------------ | ------ |  | ---------------------- | ------- | --------------------------- | - | ------------ |  | ----- | -------
|
|Liabilities and Shareholders Equity |        |  |                        |         |                             |   |              |  |       |        
|                                     |        | 
|Current Liabilities                  |        | 
|Accounts payable                     |        |  | $                      | 235     |                             | $ | 16,958       |  | $     | 25,194 
|Accrued liabilities                  |        |  |                        | 29,348  |                             |   | 40,925       |  |       | 25,115 
|Credit facilities                    |        |  |                        |        |                             |   |             |  |       | 2,567  
|Current maturities of                |        | 
|long-term debt                       |        |  |                        | 30,000  |                             |   |             |  |       | 901    
|Federal and foreign                  |        | 
|income taxes                         |        |  |                        | (1,841  | )                           |   | 80           |  |       | 8,974  
|                                    
|Total Current Liabilities            |        |  |                        | 57,742  |                             |   | 57,963       |  |       | 62,751 
|                                     |        | 
|Long-Term Debt, Net                  |        |  |                        | 215,767 |                             |   |             |  |       | 1,955  
|Deferred Income Taxes                |        |  |                        | 44,984  |                             |   |             |  |       | 296    
|Other Liabilities                    |        |  |                        | 5,392   |                             |   | 13,884       |  |       | 6,909  
|Amounts Due To (From)                |        | 
|Subsidiaries                         |        |  |                        |        |                             |   |             |  |       | 177,763
|Minority Interest                    |        |  |                        |        |                             |   |             |  |       | 2,427  
|Shareholders Equity                 |        |  |                        | 606,018 |                             |   | 532,107      |  |       | 86,327 
|                                    
|Total Liabilities and                |        | 
|Shareholders Equity                 |        |  | $                      | 929,903 |                             | $ | 603,954      |  | $     | 338,428
|                                    

-15-

---

Condensed Consolidating Statement of
Operations for the three month period ended April 29, 2005.

(In thousands)

|                              | Parent |  | Guarantor
Subsidiaries |        | Non-
Guarantor
Subsidiaries |   | Eliminations |   | Total |       
|----------------------------- | ------ |  | ---------------------- | ------ | --------------------------- | - | ------------ | - | ----- | ------
|
|                              |        |  |                        |        |                             |   |              |   |       |       
|Net Sales                     |        |  | $                      |       |                             | $ | 141,165      |   | $     | 75,528
|Cost of Sales                 |        |  |                        |       |                             |   | 97,380       |   |       | 50,775
|                             
|                              |        |  |                        |       |                             |   | 43,785       |   |       | 24,753
|                              |        |  |                        |        |                             |   |              |   |       |       
|Expenses                      |        | 
|Selling, general              |        | 
|and administrative            |        |  |                        |       |                             |   | 23,091       |   |       | 11,364
|Research, development         |        | 
|and engineering               |        |  |                        |       |                             |   | 4,191        |   |       | 5,675 
|                             
|Total Expenses                |        |  |                        |       |                             |   | 27,282       |   |       | 17,039
|                             
|Operating Earnings from       |        | 
|Continuing Operations         |        |  |                        |       |                             |   | 16,503       |   |       | 7,714 
|                              |        |  |                        |        |                             |   |              |   |       |       
|Other (income) expense        |        |  |                        | 50     |                             |   | 16           |   |       | (38   
|Interest income               |        |  |                        | (4,027 | )                           |   | (571         | ) |       | (666  
|Interest expense              |        |  |                        | 4,492  |                             |   | 1,033        |   |       | 2,811 
|                             
|Other Expense, Net            |        |  |                        | 515    |                             |   | 478          |   |       | 2,107 
|                              |        |  |                        |        |                             |   |              |   |       |       
|Income (Loss) from Continuing |        | 
|Operations Before Taxes       |        |  |                        | (515   | )                           |   | 16,025       |   |       | 5,607 
|Income Tax Expense (Benefit)  |        |  |                        | (165   | )                           |   | 4,911        |   |       | 1,669 
|                             
|Income (Loss) From            |        | 
|Continuing Operations         |        | 
|Before Minority Interest      |        |  |                        | (350   | )                           |   | 11,114       |   |       | 3,938 
|                              |        |  |                        |        |                             |   |              |   |       |       
|Minority Interest             |        |  |                        |       |                             |   |             |   |       | (35   
|                             
|Income (Loss) From            |        | 
|Continuing Operations         |        |  |                        | (350   | )                           |   | 11,114       |   |       | 3,903 
|                              |        |  |                        |        |                             |   |              |   |       |       
|Loss From Discontinued        |        | 
|Operations, Net of Tax        |        |  |                        |       |                             |   | (562         | ) |       |      
|Equity in Net Income of       |        | 
|Consolidated Subsidiaries     |        |  |                        | 14,455 |                             |   |             |   |       |      
|                             
|Net Income (Loss)             |        |  | $                      | 14,105 |                             | $ | 10,552       |   | $     | 3,903 
|                             

-16-

---

Condensed Consolidating Statement of Operations
for the six month period ended April 29, 2005.

(In thousands)

|                              | Parent |  | Guarantor
Subsidiaries |        | Non-
Guarantor
Subsidiaries |   | Eliminations |   | Total |        
|----------------------------- | ------ |  | ---------------------- | ------ | --------------------------- | - | ------------ | - | ----- | -------
|
|                              |        |  |                        |        |                             |   |              |   |       |        
|Net Sales                     |        |  | $                      |       |                             | $ | 266,494      |   | $     | 143,846
|Cost of Sales                 |        |  |                        |       |                             |   | 187,164      |   |       | 96,538 
|                             
|                              |        |  |                        |       |                             |   | 79,330       |   |       | 47,308 
|                              |        |  |                        |        |                             |   |              |   |       |        
|Expenses                      |        | 
|Selling, general              |        | 
|and administrative            |        |  |                        |       |                             |   | 41,903       |   |       | 23,862 
|Research, development         |        | 
|and engineering               |        |  |                        |       |                             |   | 7,722        |   |       | 11,391 
|                             
|Total Expenses                |        |  |                        |       |                             |   | 49,625       |   |       | 35,253 
|                             
|Operating Earnings from       |        | 
|Continuing Operations         |        |  |                        |       |                             |   | 29,705       |   |       | 12,055 
|                              |        |  |                        |        |                             |   |              |   |       |        
|Other expense                 |        |  |                        | 50     |                             |   | 16           |   |       |       
|Interest income               |        |  |                        | (7,580 | )                           |   | (1,696       | ) |       | (1,274 
|Interest expense              |        |  |                        | 8,981  |                             |   | 2,565        |   |       | 6,223  
|                             
|Other Expense, Net            |        |  |                        | 1,451  |                             |   | 885          |   |       | 4,949  
|                              |        |  |                        |        |                             |   |              |   |       |        
|Income (Loss) from Continuing |        | 
|Operations Before Taxes       |        |  |                        | (1,451 | )                           |   | 28,820       |   |       | 7,106  
|Income Tax Expense (Benefit)  |        |  |                        | (426   | )                           |   | 8,459        |   |       | 2,086  
|                             
|Income (Loss) From            |        | 
|Continuing Operations         |        | 
|Before Minority Interest      |        |  |                        | (1,025 | )                           |   | 20,361       |   |       | 5,020  
|                              |        |  |                        |        |                             |   |              |   |       |        
|Minority Interest             |        |  |                        |       |                             |   |             |   |       | (48    
|                             
|Income (Loss) From            |        | 
|Continuing Operations         |        |  |                        | (1,025 | )                           |   | 20,361       |   |       | 4,972  
|                              |        |  |                        |        |                             |   |              |   |       |        
|Income From Discontinued      |        | 
|Operations, Net of Tax        |        |  |                        |       |                             |   | 6,965        |   |       |       
|Equity in Net Income of       |        | 
|Consolidated Subsidiaries     |        |  |                        | 32,298 |                             |   |             |   |       |       
|                             
|Net Income (Loss)             |        |  | $                      | 31,273 |                             | $ | 27,326       |   | $     | 4,972  
|                             

-17-

---

Condensed Consolidating Statement of
Cash Flows for the six month period ended April 29, 2005.

(In thousands)

|                                | Parent |  | Guarantor
Subsidiaries |         | Non-
Guarantor
Subsidiaries |   | Eliminations |   | Total |       
|------------------------------- | ------ |  | ---------------------- | ------- | --------------------------- | - | ------------ | - | ----- | ------
|
|Cash Flows Provided (Used)      |        |  |                        |         |                             |   |              |   |       |       
|by Operating Activities         |        | 
|Net earnings (loss)             |        |  | $                      | 31,273  |                             | $ | 27,326       |   | $     | 4,972 
|Minority interest               |        |  |                        |        |                             |   |             |   |       | 49    
|Depreciation & amortization     |        |  |                        |        |                             |   | 11,059       |   |       | 8,776 
|Deferred income taxes           |        |  |                        | 4,056   |                             |   |             |   |       | (2,464
|Gain on sale of discontinued    |        | 
|operations                      |        |  |                        |        |                             |   | (9,456       | ) |       |      
|Loss on sale of building        |        |  |                        |        |                             |   | 59           |   |       |      
|Working capital changes, net of |        | 
|effect of acquisitions          |        | 
|Accounts receivable             |        |  |                        | 1,549   |                             |   | 8,019        |   |       | (6,528
|Inventories                     |        |  |                        |        |                             |   | (11,112      | ) |       | (3,423
|Prepaid expenses                |        |  |                        | 107     |                             |   | (1,895       | ) |       | 2,561 
|Accounts payable                |        |  |                        | (285    | )                           |   | 144          |   |       | 4,355 
|Accrued liabilities             |        |  |                        | 442     |                             |   | 1,226        |   |       | (914  
|Federal & foreign income taxes  |        |  |                        | (4,837  | )                           |   | 5            |   |       | 5,304 
|Other liabilities               |        |  |                        | 1,109   |                             |   | 44           |   |       | 147   
|Other, net                      |        |  |                        | 665     |                             |   | (651         | ) |       | (2,023
|                               
|                                |        |  |                        | 34,079  |                             |   | 24,768       |   |       | 10,812
|                                |        |  |                        |         |                             |   |              |   |       |       
|Cash Flows Provided (Used)      |        | 
|by Investing Activities         |        | 
|Purchases of capital assets     |        |  |                        | (208    | )                           |   | (6,669       | ) |       | (2,465
|Proceeds from sale of           |        | 
|discontinued operations         |        |  |                        |        |                             |   | 21,421       |   |       |      
|Proceeds from sale of building  |        |  |                        |        |                             |   | 2,319        |   |       |      
|Capital dispositions            |        |  |                        | 5       |                             |   | 74           |   |       | 67    
|Purchase of short-term          |        | 
|investments                     |        |  |                        | (45,486 | )                           |   |             |   |       |      
|Acquisitions of businesses, net |        |  |                        |        |                             |   | (3,346       | ) |       |      
|                               
|                                |        |  |                        | (45,689 | )                           |   | 13,799       |   |       | (2,398
|                                |        |  |                        |         |                             |   |              |   |       |       

-18-

---

(In thousands)

|                                | Parent |  | Guarantor
Subsidiaries |         | Non-
Guarantor
Subsidiaries |   | Eliminations |   | Total |       
|------------------------------- | ------ |  | ---------------------- | ------- | --------------------------- | - | ------------ | - | ----- | ------
|
|Cash Flows Provided (Used)      |        | 
|by Financing Activities         |        | 
|Proceeds from stock issuance    |        |  |                        | 108,490 |                             |   |             |   |       |      
|Proceeds provided by stock      |        | 
|issuance under employee         |        | 
|stock plans                     |        |  |                        | 2,854   |                             |   |             |   |       |      
|Net change in credit facilities |        |  |                        | (5,000  | )                           |   |             |   |       | 576   
|Repayment of long-term debt     |        |  |                        | (1,002  | )                           |   | (57          | ) |       | (415  
|Investment in subsidiaries      |        |  |                        | (594    | )                           |   | (39,264      | ) |       | 7,560 
|                               
|                                |        |  |                        | 104,748 |                             |   | (39,321      | ) |       | 7,721 
|                                |        |  |                        |         |                             |   |              |   |       |       
|Effect of Foreign Exchange      |        |  |                        |         |                             |   |              |   |       |       
|Rates on Cash                   |        |  |                        | 211     |                             |   | (7           | ) |       | (498  
|                               
|                                |        |  |                        |         |                             |   |              |   |       |       
|Net Increase (Decrease) in Cash |        | 
|and Cash Equivalents            |        |  |                        | 93,349  |                             |   | (761         | ) |       | 15,637
|Cash and Cash Equivalents       |        | 
| Beginning of Period           |        |  |                        | 6,859   |                             |   | 2,353        |   |       | 20,267
|                               
|Cash and Cash Equivalents       |        | 
| End of Period                 |        |  | $                      | 100,208 |                             | $ | 1,592        |   | $     | 35,904
|                               

-19-

---

Condensed Consolidating
Balance Sheet as of October 29, 2004.

(In thousands)

|                                 | Parent |  | Guarantor
Subsidiaries |         | Non-
Guarantor
Subsidiaries |   | Eliminations |  | Total |        
|-------------------------------- | ------ |  | ---------------------- | ------- | --------------------------- | - | ------------ |  | ----- | -------
|Assets                           |        |  |                        |         |                             |   |              |  |       |        
|                                 |        | 
|Current Assets                   |        | 
|Cash and cash equivalents        |        |  | $                      | 6,859   |                             | $ | 2,353        |  | $     | 20,267 
|Cash in escrow                   |        |  |                        | 8,511   |                             |   |             |  |       |       
|Accounts receivable, net         |        |  |                        | 2,221   |                             |   | 83,115       |  |       | 46,870 
|Inventories                      |        |  |                        |        |                             |   | 76,168       |  |       | 42,886 
|Deferred income tax benefits     |        |  |                        | 38,115  |                             |   |             |  |       | (17,131
|Prepaid expenses                 |        |  |                        | 353     |                             |   | 3,598        |  |       | 5,490  
|Other current assets             |        |  |                        | 147     |                             |   | 288          |  |       |       
|                                
|Total Current Assets             |        |  |                        | 56,206  |                             |   | 165,522      |  |       | 98,382 
|                                 |        |  |                        |         |                             |   |              |  |       |        
|Property, Plant & Equipment, Net |        |  |                        | 2,369   |                             |   | 99,360       |  |       | 43,406 
|Goodwill                         |        |  |                        |        |                             |   | 175,607      |  |       | 72,210 
|Intangibles, Net                 |        |  |                        | 141     |                             |   | 77,160       |  |       | 92,575 
|Debt Issuance Costs, Net         |        |  |                        | 5,818   |                             |   |             |  |       |       
|Deferred Income Tax Benefits     |        |  |                        | 11,216  |                             |   |             |  |       |       
|Other Assets                     |        |  |                        | 9,780   |                             |   | 18,309       |  |       | 4,772  
|Amounts Due (To) From            |        | 
|Subsidiaries                     |        |  |                        | 145,244 |                             |   | 41,074       |  |       |       
|Investment in Subsidiaries       |        |  |                        | 565,336 |                             |   |             |  |       | 92     
|                                
|Total Assets                     |        |  | $                      | 796,110 |                             | $ | 577,032      |  | $     | 311,437
|                                

-20-

---

(In thousands)

|                                     | Parent |  | Guarantor
Subsidiaries |         | Non-
Guarantor
Subsidiaries |   | Eliminations |  | Total |        
|------------------------------------ | ------ |  | ---------------------- | ------- | --------------------------- | - | ------------ |  | ----- | -------
|Liabilities and Shareholders Equity |        |  |                        |         |                             |   |              |  |       |        
|                                     |        |  |                        |         |                             |   |              |  |       |        
|Current Liabilities                  |        | 
|Accounts payable                     |        |  | $                      | 520     |                             | $ | 16,814       |  | $     | 20,533 
|Accrued liabilities                  |        |  |                        | 29,880  |                             |   | 41,466       |  |       | 25,692 
|Credit facilities                    |        |  |                        | 5,000   |                             |   |             |  |       | 1,977  
|Current maturities of                |        | 
|long-term debt                       |        |  |                        |        |                             |   | 50           |  |       | 981    
|Federal and foreign                  |        | 
|income taxes                         |        |  |                        | 2,996   |                             |   | 75           |  |       | 3,607  
|                                    
|Total Current Liabilities            |        |  |                        | 38,396  |                             |   | 58,405       |  |       | 52,790 
|                                     |        |  |                        |         |                             |   |              |  |       |        
|Long-Term Debt, Net                  |        |  |                        | 246,769 |                             |   | 7            |  |       | 2,280  
|Deferred Income Taxes                |        |  |                        | 43,149  |                             |   |             |  |       | 294    
|Other Liabilities                    |        |  |                        | 9,283   |                             |   | 13,840       |  |       | 6,729  
|Amounts Due To (From)                |        | 
|Subsidiaries                         |        |  |                        |        |                             |   |             |  |       | 184,094
|Minority Interest                    |        |  |                        |        |                             |   |             |  |       | 2,378  
|Shareholders Equity                 |        |  |                        | 458,513 |                             |   | 504,780      |  |       | 62,872 
|                                    
|Total Liabilities and                |        | 
|Shareholders Equity                 |        |  | $                      | 796,110 |                             | $ | 577,032      |  | $     | 311,437
|                                    

-21-

---

Condensed Consolidating Statement of
Operations for the three month period ended April 30, 2004.

(In thousands)

|                              | Parent |  | Guarantor
Subsidiaries |        | Non-
Guarantor
Subsidiaries |   | Eliminations |   | Total |       
|----------------------------- | ------ |  | ---------------------- | ------ | --------------------------- | - | ------------ | - | ----- | ------
|                              |        |  |                        |        |                             |   |              |   |       |       
|Net Sales                     |        |  | $                      |       |                             | $ | 113,592      |   | $     | 33,106
|Cost of Sales                 |        |  |                        |       |                             |   | 78,189       |   |       | 19,925
|                             
|                              |        |  |                        |       |                             |   | 35,403       |   |       | 13,181
|                              |        |  |                        |        |                             |   |              |   |       |       
|Expenses                      |        | 
|Selling, general              |        | 
|and administrative            |        |  |                        |       |                             |   | 19,215       |   |       | 6,812 
|Research, development         |        | 
|and engineering               |        |  |                        |       |                             |   | 2,402        |   |       | 3,613 
|                             
|Total Expenses                |        |  |                        |       |                             |   | 21,617       |   |       | 10,425
|                             
|Operating Earnings from       |        | 
|Continuing Operations         |        |  |                        |       |                             |   | 13,786       |   |       | 2,756 
|                              |        |  |                        |        |                             |   |              |   |       |       
|Other (income) expense        |        |  |                        |       |                             |   | (20          | ) |       | 1     
|Interest income               |        |  |                        | (1,495 | )                           |   | (628         | ) |       | (56   
|Interest expense              |        |  |                        | 4,078  |                             |   | 625          |   |       | 1,355 
|                             
|Other (Income) Expense, Net   |        |  |                        | 2,583  |                             |   | (23          | ) |       | 1,300 
|                              |        |  |                        |        |                             |   |              |   |       |       
|Income (Loss) from Continuing |        | 
|Operations Before Taxes       |        |  |                        | (2,583 | )                           |   | 13,809       |   |       | 1,456 
|Income Tax Expense (Benefit)  |        |  |                        | (830   | )                           |   | 4,299        |   |       | 261   
|                             
|Income (Loss) From            |        | 
|Continuing Operations         |        |  |                        | (1,753 | )                           |   | 9,510        |   |       | 1,195 
|                              |        |  |                        |        |                             |   |              |   |       |       
|Income From Discontinued      |        | 
|Operations, Net of Tax        |        |  |                        |       |                             |   | 960          |   |       |      
|Equity in Net Income of       |        | 
|Consolidated Subsidiaries     |        |  |                        | 11,665 |                             |   |             |   |       |      
|                             
|Net Income (Loss)             |        |  | $                      | 9,912  |                             | $ | 10,470       |   | $     | 1,195 
|                             

-22-

---

Condensed Consolidating Statement of Operations
for the six month period ended April 30, 2004.

(In thousands)

|                               | Parent |  | Guarantor
Subsidiaries |        | Non-
Guarantor
Subsidiaries |   | Eliminations |   | Total |       
|------------------------------ | ------ |  | ---------------------- | ------ | --------------------------- | - | ------------ | - | ----- | ------
|                               |        |  |                        |        |                             |   |              |   |       |       
|Net Sales                      |        |  | $                      |       |                             | $ | 213,709      |   | $     | 62,592
|Cost of Sales                  |        |  |                        |       |                             |   | 149,638      |   |       | 39,487
|                              
|                               |        |  |                        |       |                             |   | 64,071       |   |       | 23,105
|                               |        |  |                        |        |                             |   |              |   |       |       
|Expenses                       |        | 
|Selling, general               |        | 
|and administrative             |        |  |                        |       |                             |   | 36,997       |   |       | 18,890
|Research, development          |        | 
|and engineering                |        |  |                        |       |                             |   | 4,426        |   |       | 7,012 
|                              
|Total Expenses                 |        |  |                        |       |                             |   | 41,423       |   |       | 25,902
|                              
|Operating Earnings (Loss) from |        | 
|Continuing Operations          |        |  |                        |       |                             |   | 22,648       |   |       | (2,797
|                               |        |  |                        |        |                             |   |              |   |       |       
|Other (income) expense         |        |  |                        |       |                             |   | (578         | ) |       | 3     
|Interest income                |        |  |                        | (2,972 | )                           |   | (1,258       | ) |       | (140  
|Interest expense               |        |  |                        | 8,295  |                             |   | 1,250        |   |       | 2,683 
|                              
|Other (Income) Expense, Net    |        |  |                        | 5,323  |                             |   | (586         | ) |       | 2,546 
|                               |        |  |                        |        |                             |   |              |   |       |       
|Income (Loss) from Continuing  |        | 
|Operations Before Taxes        |        |  |                        | (5,323 | )                           |   | 23,234       |   |       | (5,343
|Income Tax Expense (Benefit)   |        |  |                        | (1,570 | )                           |   | 5,059        |   |       | (1,577
|                              
|Income (Loss) From             |        | 
|Continuing Operations          |        |  |                        | (3,753 | )                           |   | 18,175       |   |       | (3,766
|                               |        |  |                        |        |                             |   |              |   |       |       
|Income From Discontinued       |        | 
|Operations, Net of Tax         |        |  |                        |       |                             |   | 1,134        |   |       |      
|Equity in Net Income of        |        | 
|Consolidated Subsidiaries      |        |  |                        | 15,543 |                             |   |             |   |       |      
|                              
|Net Income (Loss)              |        |  | $                      | 11,790 |                             | $ | 19,309       |   | $     | (3,766
|                              

-23-

---

Condensed Consolidating Statement of
Cash Flows for the six month period ended April 30, 2004.

(In thousands)

|                                   | Parent |  | Guarantor
Subsidiaries |         | Non-
Guarantor
Subsidiaries |   | Eliminations |   | Total |       
|---------------------------------- | ------ |  | ---------------------- | ------- | --------------------------- | - | ------------ | - | ----- | ------
|Cash Flows Provided (Used)         |        |  |                        |         |                             |   |              |   |       |       
|by Operating Activities            |        | 
|Net earnings (loss)                |        |  | $                      | 11,790  |                             | $ | 19,309       |   | $     | (3,766
|Depreciation & amortization        |        |  |                        |        |                             |   | 10,963       |   |       | 3,973 
|Deferred income taxes              |        |  |                        | (923    | )                           |   |             |   |       | 47    
|Gain on sale of land               |        |  |                        |        |                             |   | (577         | ) |       |      
|Working capital changes, net of    |        | 
|effect of acquisitions             |        | 
|Accounts receivable                |        |  |                        | 1,190   |                             |   | 9,298        |   |       | 3,994 
|Inventories                        |        |  |                        |        |                             |   | (4,821       | ) |       | (1,571
|Prepaid expenses                   |        |  |                        | 76      |                             |   | (1,458       | ) |       | (551  
|Accounts payable                   |        |  |                        | (121    | )                           |   | (1,469       | ) |       | 133   
|Accrued liabilities                |        |  |                        | 1,054   |                             |   | (2,896       | ) |       | 1,639 
|Federal & foreign income taxes     |        |  |                        | 3,685   |                             |   | (102         | ) |       | (782  
|Other, net                         |        |  |                        | (6      | )                           |   | (2,875       | ) |       | 2,446 
|                                  
|                                   |        |  |                        | 16,745  |                             |   | 25,372       |   |       | 5,562 
|                                   |        |  |                        |         |                             |   |              |   |       |       
|Cash Flows Provided (Used)         |        | 
|by Investing Activities            |        | 
|Purchases of capital assets        |        |  |                        | (362    | )                           |   | (10,176      | ) |       | (1,050
|Proceeds from sale of land         |        |  |                        |        |                             |   | 1,179        |   |       |      
|Capital dispositions               |        |  |                        |        |                             |   | 437          |   |       | (4    
|Purchase of short-term investments |        |  |                        | (6,238  | )                           |   |             |   |       |      
|Acquisitions of businesses, net    |        |  |                        |        |                             |   | (6,633       | ) |       |      
|                                  
|                                   |        |  |                        | (6,600  | )                           |   | (15,193      | ) |       | (1,054
|                                   |        |  |                        |         |                             |   |              |   |       |       
|Cash Flows Provided (Used)         |        | 
|by Financing Activities            |        | 
|Proceeds provided by stock         |        | 
|issuance under employee            |        | 
|stock plans                        |        |  |                        | 1,266   |                             |   |             |   |       |      
|Net change in credit facilities    |        |  |                        |        |                             |   |             |   |       | 564   
|Repayment of long-term debt        |        |  |                        | (31,010 | )                           |   | (42          | ) |       | (213  
|Debt and other issuance costs      |        |  |                        | (179    | )                           |   |             |   |       |      
|Investment in subsidiaries         |        |  |                        | (6,617  | )                           |   | (8,777       | ) |       | (149  
|                                  
|                                   |        |  |                        | (36,540 | )                           |   | (8,819       | ) |       | 202   

-24-

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(In thousands)

|                                | Parent |  | Guarantor
Subsidiaries |         | Non-
Guarantor
Subsidiaries |   | Eliminations |  | Total |       
|------------------------------- | ------ |  | ---------------------- | ------- | --------------------------- | - | ------------ |  | ----- | ------
|Effect of Foreign Exchange      |        |  |                        |         |                             |   |              |  |       |       
|Rates on Cash                   |        |  |                        | (742    | )                           |   | 6            |  |       | 1,133 
|                               
|                                |        |  |                        |         |                             |   |              |  |       |       
|Net Increase (Decrease) in Cash |        | 
|and Cash Equivalents            |        |  |                        | (27,137 | )                           |   | 1,366        |  |       | 5,843 
|Cash and Cash Equivalents       |        | 
| Beginning of Period           |        |  |                        | 109,834 |                             |   | 3,030        |  |       | 18,499
|                               
|Cash and Cash Equivalents       |        | 
| End of Period                 |        |  | $                      | 82,697  |                             | $ | 4,396        |  | $     | 24,342
|                               

-25-

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# Item 2.          
Managements Discussion and Analysis of Financial Condition and Results of
Operations

# Overview

We view and operate our businesses in
three segments: Avionics & Controls, Sensors & Systems and Advanced
Materials. The Avionics & Controls segment designs and manufactures technology
interface systems for military and commercial aircraft and land- and sea-based military
vehicles, secure communications systems, specialized medical equipment, and other
industrial applications. The Sensors & Systems segment produces high-precision
temperature and pressure sensors, electrical power switching, control and data
communication devices, micro-motors, motion control sensors, and other related systems,
principally for aerospace and defense customers. The Advanced Materials segment develops
and manufactures high-performance elastomer products used in a wide range of commercial
aerospace and military applications and combustible ordnance components and electronic
warfare countermeasure devices for military customers. Sales in all segments include
domestic, international, defense and commercial customers.

Our current business and strategic
plan focuses on the continued development of our products in three key technology
segments:  avionics and controls, sensors and systems and specialized high-performance
elastomers and other complex materials, principally for the aerospace and defense markets.
We are concentrating our efforts to expand our capabilities in these markets and to
anticipate the global needs of our customers and respond to such needs with comprehensive
solutions. These efforts focus on continuous research and new product development,
acquisitions and establishing strategic realignments of operations to expand our
capabilities as a more comprehensive supplier to our customers across our entire product
offering.

On January 28, 2005, we
completed the sale of the outstanding stock of our wholly owned subsidiary Fluid
Regulators Corporation (Fluid Regulators), which was included in our Sensors &
Systems segment, for approximately $23.7 million. As a result of the sale, we
recorded a gain of approximately $7.0 million, net of tax of $2.4 million, in
the first fiscal quarter of 2005.

On July 25, 2002, our Board
of Directors adopted a formal plan for the sale of the assets and operations of our former
Automation segment. Upon the final disposition of our discontinued Automation operations
in the fourth fiscal quarter of 2004, we recorded an $8.0 million gain, net of
$4.5 million in tax, including the reversal of estimated reserves, which were
recognizable upon the sale of the business.

On May 13, 2005, we closed
a small unit in our Other segment and incurred $0.4 million in severance, net of
$0.2 million in tax, in the second quarter of fiscal 2005.

-26-

---

The dispositions and closure
described above are reported as discontinued operations and the consolidated financial
statements for all prior periods have been adjusted to reflect this presentation.

-27-

---

# Results of Continuing
Operations

Three Month Period Ended
April 29, 2005 Compared to Three Month Period Ended April 30, 2004

Sales for the second fiscal quarter
increased 44.5% when compared with the prior-year period. Sales by segment were as
follows:

(In thousands)

| |  |  |                     | Three Months Ended | 
| |  |  | ------------------- | ------------------ | 
|
| |  |  |                     |                    | 
| |  |  | Avionics & Controls |                    | 
| |  |  | Sensors & Systems   |                    | 
| |  |  | Advanced Materials  |                    | 
| |  |  |                     |                    | 
| |  |  | Total Net Sales     |                    | 
| |  |  |                     |                    | 

The 24.3% increase in
Avionics & Controls principally reflected incremental sales from the Leach
Holding Corporation (Leach) medical unit acquisition in the fourth fiscal quarter of 2004
and higher sales at our AVISTA unit. Sales were also enhanced by increased volumes of
aftermarket spares, cockpit panels and control products. These sales increases were
partially offset by a decrease in sales of technology interface systems for land-based
vehicles.

The 112.6% increase in sales of
Sensors & Systems principally reflected $32.9 million in incremental sales
from the Leach acquisition, enhanced sales of temperature and pressure sensors, and motion
control distribution sales to the British Ministry of Defence (British MoD) as well as
increased sales volumes of aftermarket products. Sensors & Systems sales also
reflected a stronger euro relative to the U.S. dollar, as the average exchange rate from
the euro to the U.S. dollar increased from 1.22 in the second quarter of fiscal 2004 to
1.30 in the second quarter of fiscal 2005.

The 14.1% increase in Advanced
Materials reflected higher sales of elastomer material to aerospace customers.
Additionally, sales increased at our metal finishing unit, reflecting an improving
commercial aerospace market.

Overall, for the second quarter of
fiscal 2005, gross margin as a percentage of sales was 32.4% compared with 33.2% for the
second quarter of fiscal 2004. Avionics & Controls segment gross margin was 33.7%
and 34.5% for the second fiscal quarter of 2005 and 2004, respectively.
Avionics & Controls gross margin decreased from the prior-year period due to a
higher mix of medical equipment sales. Sensors & Systems segment gross margin was
35.3% and 39.8% for the second fiscal quarter of 2005 and 2004, respectively.
Sensors & Systems gross margin declined from the prior-year period due to a
higher mix of electrical power switching, control and data communication devices due to
the Leach acquisition, a loss contract reserve and the effect
of a weaker U.S. dollar compared with the euro on U.S. dollar-denominated sales and
euro-denominated cost of sales. Advanced Materials segment gross margin was 27.0% for the second

-28-

---

fiscal quarter of 2005 and 2004. Lower sales volumes of combustible ordnance and
incremental start-up costs on certain flare countermeasure devices were offset by improved
gross margins at our elastomer material and metal finishing operations. Our elastomer
material gross margins were favorably impacted by decreased workers compensation expenses,
lower integration expenses, and higher sales volumes to aerospace customers, which
resulted in an increased recovery of fixed expenses. In the prior-year period, our
elastomer material operations were negatively impacted by certain operational
inefficiencies from integrating acquired businesses which resulted in higher labor costs.
Improved gross margins at our metal finishing operations reflected an improved recovery of
fixed expenses due to higher sales and increased selling prices.

Selling, general and administrative
expenses (which include corporate expenses) totaled $34.5 million and
$26.0 million for the second fiscal quarter of 2005 and 2004, respectively, or 16.3%
of sales for the second fiscal quarter of 2005 compared with 17.8% for the prior-year
period. The overall increase in the amount of selling, general and administrative expenses
primarily reflected incremental selling, general and administrative expenses as a result
of the Leach acquisition. The decrease in selling, general and administrative expenses as
a percentage of sales principally reflected higher sales volumes without a proportional
increase in the expense during the current fiscal quarter. These selling, general and
administrative expenses are typically fixed.

Research, development and engineering
spending was $9.9 million, or 4.7% of sales, for the second fiscal quarter of 2005
compared with $6.0 million, or 4.1% of sales, for the second fiscal quarter of 2004.
The increase in research, development and engineering spending principally reflected the
acquisition of Leach in the fourth quarter of fiscal 2004 and the requirement to fund
development for new programs for our OEM customers.

Segment earnings (operating earnings
excluding corporate expenses) for the second fiscal quarter of 2005 totaled
$30.2 million, compared with $20.9 million for the second fiscal quarter in
2004. Avionics & Controls segment earnings were $9.6 million for the second
fiscal quarter of 2005 compared with $8.6 million for the second fiscal quarter of
2004, principally reflecting the strong results at our newly acquired Leach medical unit
and our AVISTA unit. We believe there is some potential that the earnings growth we experienced
from our medical equipment operations during the first six months of fiscal 2005 will moderate
in the second half of the fiscal year. Sensors & Systems segment earnings were $11.4 million
for the second quarter of fiscal 2005 compared with $4.8 million for the second
quarter of fiscal 2004, primarily reflecting strong sales and earnings in our sensors,
motion control and electrical power switching operations. Advanced Materials segment
earnings were $9.2 million for the second fiscal quarter of 2005 compared with
$7.4 million for the second fiscal quarter of 2004. Advanced Materials earnings were
enhanced by increased earnings at our elastomer material and metal finishing units,
reflecting strong demand from aerospace customers and lower operating expenses. Earnings
at our combustible ordnance and countermeasure operations were impacted by production
inefficiencies on new countermeasure flare products and higher operating expenses.

Interest expense for the second fiscal
quarter of 2005 was $4.1 million compared with $4.2 million for the second
fiscal quarter of 2004.

-29-

---

The effective income tax rate for the
second fiscal quarter of 2005 was 30.4% compared with 29.4% for the second fiscal quarter
of 2004. The effective tax rate differed from the statutory rate, as both years benefited
from various tax credits and benefits.

New orders for the second fiscal
quarter of 2005 were $263.4 million compared with $154.5 million for the same
period in 2004, an increase of 70.5%. The increase in orders reflects the Leach
acquisition, the timing of receiving combustible ordnance orders and increased elastomer
material orders.

Six Month Period Ended
April 29, 2005 Compared to Six Month Period Ended April 30, 2004

Year-to-date sales increased 45.5%
when compared with the prior-year period. Sales by segment were as follows:

(In thousands)

| |  |  |                     | Six Months Ended | 
| |  |  | ------------------- | ---------------- | 
|
| |  |  |                     |                  | 
| |  |  | Avionics & Controls |                  | 
| |  |  | Sensors & Systems   |                  | 
| |  |  | Advanced Materials  |                  | 
| |  |  |                     |                  | 
| |  |  | Total Net Sales     |                  | 
| |  |  |                     |                  | 

The 27.6% increase in sales of
Avionics & Controls principally reflected incremental sales from the Leach medical
unit acquisition. The increase also reflected higher sales of specialized medical
equipment and cockpit controls as well as higher sales at our AVISTA unit. These increases
were partially offset by lower sales of technology interface systems for land-based
military vehicles.

The 113.5% increase in sales of
Sensors & Systems principally reflected $62.2 million in incremental sales
from the Leach acquisition, enhanced sales of temperature and pressure sensors and motion
control distribution sales to the British MoD as well as increased sales volumes of
aftermarket products. The increase also reflected a stronger euro relative to the U.S.
dollar, as the average exchange rate from the euro to the U.S. dollar increased from 1.22
in the first six months of fiscal 2004 to 1.31 in the first six months of fiscal 2005.

The 13.4% increase in Advanced
Materials reflected higher sales of elastomer material and increased sales at our metal
finishing unit. Sales of our combustible ordnance and countermeasure devices were even
with the prior-year period.

Overall, gross margin as a percentage
of sales was 31.6% for the first six months of fiscal 2005 and 2004. Avionics &
Controls segment gross margin was 32.6% and 33.5% for the first six months of fiscal 2005
and 2004, respectively. Avionics & Controls gross margin decreased from the
prior-year period due to a higher mix of medical equipment sales. Sensors &
Systems segment gross margin was 35.0% and 37.6% for the first six months of fiscal 2005
and 2004,

-30-

---

respectively. Sensors & Systems gross margin decreased from the prior-year period, reflecting a sales mix of lower margin sales from the Leach acquisition,
partially offset by greater aftermarket spares sales. Advanced Materials segment gross
margin was 25.7% and 25.4% for the first six months of fiscal 2005 and 2004, respectively.
Advanced Materials gross margin increased when compared with the prior-year period,
reflecting higher sales volume of elastomer material to aerospace customers, lower
acquisition integration expenses, production efficiencies and lower workers compensation
expense.

Selling, general and administrative
expenses (which include corporate expenses) totaled $65.8 million and
$55.9 million for the first six months of fiscal 2005 and 2004, respectively, or
16.4% of sales, for the first six months of fiscal 2005 compared with 20.3% for the prior-year period. The overall increase in the amount of selling, general and administrative
expenses primarily reflected incremental selling, general and administrative expenses as a
result of the Leach acquisition. The decrease in selling, general and administrative
expense as a percentage of sales principally reflected $4.5 million in severance
expense in our Sensors & Systems segment incurred in the prior-year period and
higher sales volumes without a proportional increase in the expense during the six months
ended April 29, 2005. These selling, general and administrative expenses are
typically fixed.

Research, development and engineering
expenses were $19.1 million, or 4.8% of sales, for the first six months of fiscal
2005 compared with $11.4 million, or 4.1% of sales, for the first six months of
fiscal 2004. The increase in research, development and engineering spending principally
reflected the acquisition of Leach in the fourth quarter of fiscal 2004 and the
requirement to fund development for new programs for our OEM customers.

Segment earnings (operating earnings
excluding corporate expenses) for the first six months of fiscal 2005 totaled
$51.9 million, compared with $28.1 million for the prior-year period.
Avionics & Controls segment earnings of $18.8 million for the first six
months of fiscal 2005 compared with $15.4 million in the prior-year period and
reflected increased earnings at our newly acquired Leach medical unit and our AVISTA unit.
We believe there is some potential that the earnings growth we experienced from our
medical equipment operations during the first six months of fiscal 2005 will moderate
in the second half of the fiscal year.
Sensors & Systems segment earnings were $17.7 million for the first six
months of fiscal 2005 compared with $0.8 million in the prior-year period. The
increase in Sensors & Systems earnings from the prior-year period reflected
incremental earnings from the Leach acquisition, higher sales volumes and lower operating
expenses. The decrease in operating expenses compared with the prior-year period reflected
$4.5 million in severance and legal costs covering 35 employees in engineering,
production, quality, research and development and administration functions. In addition,
nearly 20 employees elected early retirement or voluntarily resigned in the 2004 period.
Sensors & Systems earnings also reflected the impact of a weaker U.S. dollar
relative to the euro on U.S. dollar-denominated sales and euro-based operating expenses.
Advanced Materials segment earnings were $15.5 million for the first six months of
fiscal 2005 compared with $11.8 million for the prior-year period. Advanced Materials
earnings reflected higher sales and earnings from our elastomer and metal finishing
operations. Advanced Materials earnings were negatively

-31-

---

impacted by higher operating expenses at our combustible ordnance and countermeasure operations.

Interest expense for the first six
months of fiscal 2005 was $8.8 million compared with $8.5 million for the
prior-year period.

The effective income tax rate for the
first six months of fiscal 2005 was 29.4% compared with 30.3% (before a $1.9 million
reduction of previously estimated tax liabilities) for the prior-year period. The
effective tax rate differed from the statutory rate, as both years benefited from various
tax credits and benefits. On February 4, 2004, we received a Notice of Proposed
Adjustment (NOPA) from the Internal Revenue Service covering the audit of research and
development tax credits for fiscal years 1997 through 1999. As a result of the NOPA and
the expectation of a similar result for fiscal years 2000 through 2003, we revised our
estimated liability for income taxes as of January 30, 2004. The revision
resulted in a $1.9 million reduction of previously estimated tax liabilities.

During the first fiscal quarter of
2004, we sold land in Coachella, California, for cash and recorded a gain on sale of
$577,000, which is included in other income.

New orders for the first six months
of fiscal 2005 were $467.2 million compared with $304.9 million for the same
period in fiscal 2004. Backlog at April 29, 2005, was $489.6 million
compared with $323.7 million at April 30, 2004. The increase in backlog
principally reflected the Leach acquisition. Approximately $190.0 million in backlog
is scheduled for delivery after fiscal 2005. Most orders in backlog are subject to
cancellation until delivery.

-32-

---

# Liquidity and Capital Resources

Cash and cash equivalents and
short-term investments at April 29, 2005 totaled $183.2 million, an
increase of $153.7 million from October 29, 2004. Net working capital
increased to $303.9 million at April 29, 2005 from $170.5 million at
October 29, 2004. Sources of cash flows from operating activities principally
consist of cash received from the sale of products offset by cash payments for material,
labor and operating expenses. Cash flows from operating activities were $37.4 million
and $32.1 million in the first six months of fiscal 2005 and 2004, respectively. The
increase principally reflected higher net earnings, partially offset by increased
inventory purchases. The net increase in cash flows used by investing activities
principally reflected increased purchases of short-term investments, the net proceeds from
the sale of Fluid Regulators of $21.4 million, a $3.3 million purchase price
adjustment payable to the seller of AVISTA and the $6.5 million acquisition of AVISTA
in the first fiscal quarter of 2004. The increase in cash provided by financing activities
principally reflected the net proceeds of $108.5 million from our public offering of
3.7 million shares of common stock completed on November 24, 2004,
partially offset by the repayment of $30 million of the 1999 Senior Notes in
accordance with their terms in the prior-year period.

Capital expenditures, consisting of
machinery, equipment and computers, are anticipated to be approximately $22.0 million
during fiscal 2005, compared with $22.1 million expended in fiscal 2004. Capital
expenditures for the first six months of 2005 totaled $9.3 million, primarily for
machinery and equipment and enhancements to information systems.

Total debt at
April 29, 2005 was $251.2 million and consisted of $175.0 million of
Senior Subordinated Notes, $70.0 million of 1999 Senior Notes, and $6.2 million
of various foreign currency debt agreements, including capital lease obligations. The
Senior Subordinated Notes mature June 15, 2013, bear interest at 7.75% and
contain customary covenants, including restrictions on incurrence of additional debt in
certain circumstances, repurchase of our common stock, declaration of dividends,
retirement or redemption of subordinated debt, creation of liens and certain asset
dispositions. We are in compliance with these covenants and do not view the restrictions
as limiting our planned activities. In September 2003 we entered into an interest
rate swap agreement on $75 million of our Senior Subordinated Notes due in 2013. The
swap agreement exchanged the fixed rate for a variable interest rate on $75 million
of the $175 million principal amount outstanding. The 1999 Senior Notes have
maturities ranging from November 2005 to 2008 and interest rates from 6.4% to 6.77%. We
have a U.S. dollar credit facility totaling up to $60,000,000 of borrowing capacity. The
facility is secured by substantially all of our assets. The credit agreement for the
facility contains customary covenants, including but not limited to, restrictions on
liens, making certain investments in third parties, capital expenditures, incurrence of
additional indebtedness, repurchase of our common stock, declaration of dividends and
certain asset dispositions. In addition, the credit agreement requires that we meet
certain financial covenants, including a maximum leverage ratio, a fixed charge coverage
ratio, a total debt to capitalization ratio and a minimum tangible net worth. As of
April 29, 2005, we were in compliance with these covenants under the credit
facility. We believe cash on hand and funds generated from operations are adequate to
service operating cash requirements and capital

-33-

---

expenditures through April 2006. In addition, we believe that
we have adequate access to capital markets to fund future acquisitions.

# Recent Accounting
Pronouncements

In December 2004, the Financial
Accounting Standards Board issued Statement of Financial Accounting Standards
No. 123R, Share-Based Payment (Statement No. 123R), which is
effective for the Company no later than the beginning of our first fiscal quarter of 2006.
This statement will have a significant impact on our consolidated statements of
operations, as we will be required to expense the fair value of our stock option grants
and stock purchases under our employee stock purchase plan rather than disclose the impact
on our consolidated net income within our footnotes as is our current practice. We intend
to comply with the standard at the beginning of our first fiscal quarter of 2006. The
impact of adoption cannot be predicted at this time because it will depend on levels of
share-based payments granted in the future. However, had we adopted Statement
No. 123R in prior periods, the impact of that standard would have approximated the
impact of Statement 123 as described in the disclosure of pro forma net income and
earnings per share in Note 9 to the Consolidated Financial Statements of Esterline
Technologies in this Form 10-Q.

# Forward-Looking Statements

This quarterly report on
Form 10-Q contains forward-looking statements. These statements relate to future
events or our future financial performance. In some cases you can identify forward-looking
statements by terminology such as anticipate, believe,
continue, could, estimate, expect,
intend, may, might, plan,
potential, predict, should or will or the
negative of such terms or other comparable terminology. These statements are only
predictions and involve known and unknown risks, uncertainties and other factors,
including the risk factors set forth in Forward-Looking Statements and Risk
Factors in our Annual Report on Form 10-K for the fiscal year ended
October 29, 2004, that may cause our or the industrys actual results,
performance or achievements to be materially different from any future results,
performance or achievements expressed or implied by such forward-looking statements. You
should not place undue reliance on these forward-looking statements. Although we believe
that the expectations reflected in the forward-looking statements are reasonable, we
cannot guarantee future results, performance or achievements. Given these risks and
uncertainties, you are cautioned not to place undue reliance on such forward-looking
statements. The forward-looking statements included or incorporated by reference into this
report are made only as of the date hereof. We do not undertake and specifically decline
any obligation to update any such statements or to publicly announce the results of any
revisions to any such statements to reflect future events or developments.

-34-

---

# Item 4.     
     Controls and Procedures

Our principal executive and financial
officers evaluated our disclosure controls and procedures (as defined in
Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of April 29, 2005.
Based upon that evaluation, they concluded as of April 29, 2005 that our
disclosure controls and procedures were effective to ensure that information we are
required to disclose in the reports that we file under the Exchange Act is recorded,
processed, summarized and reported within time periods specified in Securities and
Exchange Commission rules and forms.

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

-35-

---

# PART II  OTHER
INFORMATION

# Item 1.     
     Legal Proceedings

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

# Item 4.     
     
Submission of Matters to a Vote of Security Holders

At our annual meeting of shareholders
held on March 2, 2005, the shareholders acted on the following proposal:

The election of the following
directors for three-year terms expiring at the 2008 annual meeting:

|                        | Votes Cast | 
|----------------------- | ---------- | 
|
|                        |            | 
|Lewis E. Burns          |            | 
|Robert W. Cremin        |            | 
|Anthony P. Franceschini |            | 

The election of the following director
for a two-year term expiring at the 2007 annual meeting:

|                  | Votes Cast | 
|----------------- | ---------- | 
|
|                  |            | 
|Charles R. Larson |            | 

Current directors whose terms are
continuing after the 2005 annual meeting are Ross J. Centanni,
John F. Clearman, Robert S. Cline, Jerry D. Leitman, and
James L. Pierce.

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# Item 5.     
     Other Information

Effective June 2, 2005, John F. Clearman was appointed to the
Audit Committee and resigned from the Compensation Committee.  The members of the committees of our Board of Directors
listed below are as follows:

# Audit Committee

Robert S. Cline,
Chairman         John F. Clearman
         Anthony P. Franceschini         Charles R. Larson
         James L. Pierce

# Compensation Committee

Jerry D. Leitman, Chairman
         Lewis E. Burns         Ross J. Centanni

# Nominating &
Corporate Governance Committee

Ross J. Centanni,
Chairman         Lewis E. Burns         Robert S. Cline
         Anthony P. Franceschini

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|Item 6. | Exhibits | 
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|        |          | 
|        |          | 
|        |          | 
|        |          | 
|        |          | 
|        |          | 
|        |          | 

* Indicates management contract or
compensatory plan or arrangement.

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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 hereunto duly authorized.

|                     |  |     |                                                                                                                                                                 
|-------------------- |  | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------
|                     |  |     | ESTERLINE TECHNOLOGIES CORPORATION     
                     
  (Registrant)                                                                                    
|                     |  |     |                                                                                                                                                                 
|Dated:  June 3, 2005 |  | By: | /s/  Robert D. George                                                                                                                                           
|                     |  |     | Robert D. GeorgeVice President, Chief Financial Officer,           Secretary and Treasurer
             
(Principal Financial            and Accounting Officer)
|                     |  |     |                                                                                                                                                                 

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