**UNITED STATES**

**SECURITIES AND EXCHANGECOMMISSION**

**Washington,D.C. 20549**

**FORM 10-Q**

**QUARTERLYREPORT**

Pursuant to Section 13 or 15(d)of the Securities Exchange Act of 1934

**For theQuarter Ended June 30, 2007**

**1-8931**

Commission File Number

##### **CUBICCORPORATION**

Exact Name of Registrant asSpecified in its Charter

| **Delaware**                     |   | **95-1678055**                   |
|----------------------------------|--------|----------------------------------|
| State of  Incorporation          |   | IRS Employer  Identification No. |
|                             |   |                             |
|                             |   |                             |
| **9333  Balboa Avenue**          |
| **San  Diego, California 92123** |
| **Telephone  (858) 277-6780**    |

 

Indicate by check markwhether the Registrant (1) has filed all reports required to be filed bySection 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding12 months, and (2) has been subject to such filing requirements for the past 90days.

Yes  x    No  o

Indicate by check mark whether the registrant isa large accelerated filer, an accelerated filer, or a non-accelerated filer (asdefined in Rule 12b-2 of the Exchange Act).
| Large accelerated filer   o | Accelerated filer   x | Non-accelerated filer   o |
|--------------------------------------------|--------------------------------------|------------------------------------------|

 

Indicate by check mark whether the registrant isa shell company (as defined in Rule 12-b-2 of the Exchange Act).                                                                                      Yes  o    No  x

Asof July 27, 2007, registrant had only one class of common stock of which therewere 26,719,663 shares outstanding (after deducting 8,945,066 shares held astreasury stock).

 

----

**PART I - FINANCIAL INFORMATION**

ITEM 1 - FINANCIAL STATEMENTS

### **CUBIC CORPORATION**

CONDENSED CONSOLIDATEDSTATEMENTS OF INCOME (UNAUDITED)

(amounts in thousands, exceptper share data)
| ** **                                     | ** ** | **Nine Months Ended  June 30,**                                  | ** ** | **Three Months Ended  June 30,** | ** ** |
|------------------------------------------------|------------|---------------------------------------------------------------------------------|------------|-------------------------------------------------|------------|
| ** **                                     | ** ** | **2007**                                                                        | ** ** | **2006**                                        | ** ** | **2007** | ** ** | **2006** | ** ** |
| ** **                                     | ** ** | **(amounts in thousands, except per share data)** | ** ** |
| Net sales:                                     |       |                                                                            |       |                                            |       |   |   |   |   |
| Products                                       |       | $                                                                               | 391,563    |                                            | $          | 371,230 |   | $ | 138,120 |   | $ | 125,286 |   |
| Services                                       |       | 275,162                                                                         |       | 245,404                                         |       | 95,629 |   | 89,668 |   |
|                                           |       | 666,725                                                                         |       | 616,634                                         |       | 233,749 |   | 214,954 |   |
| Costs and expenses:                            |       |                                                                            |       |                                            |       |   |   |   |   |
| Products                                       |       | 318,031                                                                         |       | 317,987                                         |       | 111,226 |   | 104,763 |   |
| Services                                       |       | 227,874                                                                         |       | 202,680                                         |       | 79,461 |   | 75,423 |   |
| Selling, general  and administrative           |       | 72,169                                                                          |       | 70,420                                          |       | 25,252 |   | 23,458 |   |
| Research and  development                      |       | 2,601                                                                           |       | 5,137                                           |       | 1,250 |   | 991 |   |
|                                           |       | 620,675                                                                         |       | 596,224                                         |       | 217,189 |   | 204,635 |   |
| Operating income                               |       | 46,050                                                                          |       | 20,410                                          |       | 16,560 |   | 10,319 |   |
|                                           |       |                                                                            |       |                                            |       |   |   |   |   |
| Other income (expense):                        |       |                                                                            |       |                                            |       |   |   |   |   |
| Gain on sale of  investment real estate        |       | —                                                                          |       | 7,237                                           |       | — |   | — |   |
| Interest and  dividends                        |       | 1,791                                                                           |       | 1,321                                           |       | 893 |   | 670 |   |
| Interest expense                               |       | (2,202                                                                          | )          | (3,534                                          | )          | (726 | ) | (1,318 | ) |
| Other income                                   |       | 1,195                                                                           |       | 172                                             |       | 665 |   | (447 | ) |
| Minority  interest in loss of subsidiary       |       | 579                                                                             |       | 808                                             |       | 185 |   | 152 |   |
|                                           |       |                                                                            |       |                                            |       |   |   |   |   |
| Income before income  taxes                    |       | 47,413                                                                          |       | 26,414                                          |       | 17,577 |   | 9,376 |   |
|                                           |       |                                                                            |       |                                            |       |   |   |   |   |
| Income taxes                                   |       | 16,700                                                                          |       | 9,200                                           |       | 6,400 |   | 3,400 |   |
|                                           |       |                                                                            |       |                                            |       |   |   |   |   |
| Net income                                     |       | $                                                                               | 30,713     |                                            | $          | 17,214 |   | $ | 11,177 |   | $ | 5,976 |   |
|                                           |       |                                                                            |       |                                            |       |   |   |   |   |
| Basic and diluted net  income per common share |       | $                                                                               | 1.15       |                                            | $          | 0.64 |   | $ | 0.42 |   | $ | 0.22 |   |
|                                           |       |                                                                            |       |                                            |       |   |   |   |   |
| Dividends per common  share                    |       | $                                                                               | 0.09       |                                            | $          | 0.09 |   | $ | — |   | $ | — |   |
|                                           |       |                                                                            |       |                                            |       |   |   |   |   |
| Average number of common shares outstanding    |       | 26,720                                                                          |       | 26,720                                          |       | 26,720 |   | 26,720 |   |

 

*See accompanying notes.*

2

----

CUBIC CORPORATION

CONDENSED CONSOLIDATED BALANCESHEETS

(in thousands) 
| ** **                                     | ** ** | **June 30,  2007** | ** ** | **September 30,  2006**   | ** ** |
|------------------------------------------------|------------|-------------------------|------------|--------------------------------|------------|
| ** **                                     | ** ** | **(Unaudited)**         | ** ** | **(See note below)** | ** ** |
| **ASSETS**                                     | ** ** | ** **              | ** ** | ** **                     | ** ** |
| Current assets:                                |       |                    |       |                           |       |
| Cash and cash equivalents                      |       | $                       | 76,450     |                           | $          | 42,380 |   |
| Short-term investments                         |       | 21,186                  |       | 8,874                          |       |
| Accounts receivable - net                      |       | 308,016                 |       | 330,447                        |       |
| Inventories                                    |       | 26,548                  |       | 20,209                         |       |
| Deferred income taxes and other current assets |       | 33,596                  |       | 36,159                         |       |
| Total current  assets                          |       | 465,796                 |       | 438,069                        |       |
|                                           |       |                    |       |                           |       |
| Long-term contract  receivables                |       | 16,300                  |       | 2,200                          |       |
| Property, plant  and equipment - net           |       | 56,492                  |       | 54,564                         |       |
| Goodwill                                       |       | 35,902                  |       | 34,750                         |       |
| Other assets                                   |       | 16,886                  |       | 18,488                         |       |
|                                           |       | $                       | 591,376    |                           | $          | 548,071 |   |
|                                           |       |                    |       |                           |       |
| **LIABILITIES  AND SHAREHOLDERS' EQUITY**      | ** ** | ** **              | ** ** | ** **                     | ** ** |
| Current  liabilities:                          |       |                    |       |                           |       |
| Short-term borrowings                          |       | $                       | —     |                           | $          | 10,000 |   |
| Trade accounts payable                         |       | 25,913                  |       | 23,240                         |       |
| Customer advances                              |       | 66,627                  |       | 43,752                         |       |
| Other current liabilities                      |       | 65,740                  |       | 64,095                         |       |
| Accrued pension liability                      |       | 3,414                   |       | 6,283                          |       |
| Income taxes payable                           |       | 4,227                   |       | 7,099                          |       |
| Current portion of long-term debt              |       | 6,126                   |       | 6,078                          |       |
| Total current  liabilities                     |       | 172,047                 |       | 160,547                        |       |
|                                           |       |                    |       |                           |       |
| Long-term debt                                 |       | 32,737                  |       | 38,159                         |       |
| Accrued pension  liability                     |       | 19,982                  |       | 18,208                         |       |
| Deferred  compensation                         |       | 7,949                   |       | 7,565                          |       |
| Minority  interest                             |       | —                  |       | 366                            |       |
|                                           |       |                    |       |                           |       |
| Shareholders'  equity:                         |       |                    |       |                           |       |
| Common stock                                   |       | 234                     |       | 234                            |       |
| Additional paid-in capital                     |       | 12,123                  |       | 12,123                         |       |
| Retained earnings                              |       | 366,831                 |       | 338,523                        |       |
| Accumulated other comprehensive income         |       | 15,542                  |       | 8,415                          |       |
| Treasury stock at cost                         |       | (36,069                 | )          | (36,069                        | )          |
|                                           |       | 358,661                 |       | 323,226                        |       |
|                                           |       | $                       | 591,376    |                           | $          | 548,071 |   |

 

*Note: The balance sheet at September 30, 2006 has been derived from theaudited financial statements at that date.*

# *See accompanying notes.*

3

----

**CUBIC CORPORATION**

CONDENSED CONSOLIDATEDSTATEMENTS OF CASH FLOWS (UNAUDITED)

(in thousands)
| ** **                                                                                   | ** ** | **Nine Months Ended  June 30,** | ** ** | **Three Months Ended  June 30,** | ** ** |
|----------------------------------------------------------------------------------------------|------------|------------------------------------------------|------------|-------------------------------------------------|------------|
| ** **                                                                                   | ** ** | **2007**                                       | ** ** | **2006**                                        | ** ** | **2007** | ** ** | **2006** | ** ** |
| Operating  Activities:                                                                       |       |                                           |       |                                            |       |   |   |   |   |
| Net income                                                                                   |       | $                                              | 30,713     |                                            | $          | 17,214 |   | $ | 11,177 |   | $ | 5,976 |   |
| Adjustments to reconcile net income to net cash  provided by (used in) operating activities: |       |                                           |       |                                            |       |   |   |   |   |
| Depreciation and amortization                                                                |       | 6,782                                          |       | 6,819                                           |       | 2,262 |   | 2,219 |   |
| Gain on sale of investment real estate                                                       |       | —                                         |       | (7,237                                          | )          | — |   | — |   |
| Changes in operating assets and liabilities                                                  |       | 32,351                                         |       | (18,610                                         | )          | 18,742 |   | (4,339 | ) |
| NET CASH  PROVIDED BY (USED IN)                                                              |       |                                           |       |                                            |       |   |   |   |   |
| OPERATING ACTIVITIES                                                                         |       | 69,846                                         |       | (1,814                                          | )          | 32,181 |   | 3,856 |   |
|                                                                                         |       |                                           |       |                                            |       |   |   |   |   |
| Investing  Activities:                                                                       |       |                                           |       |                                            |       |   |   |   |   |
| Net additions to property, plant and equipment                                               |       | (6,756                                         | )          | (8,082                                          | )          | (3,430 | ) | (2,452 | ) |
| Proceeds from sale of investment real estate                                                 |       | —                                         |       | 8,028                                           |       | — |   | — |   |
| Change in short-term investments, net                                                        |       | (12,312                                        | )          | —                                          |       | (12,760 | ) | — |   |
| NET CASH USED IN                                                                             |       |                                           |       |                                            |       |   |   |   |   |
| INVESTING ACTIVITIES                                                                         |       | (19,068                                        | )          | (54                                             | )          | (16,190 | ) | (2,452 | ) |
|                                                                                         |       |                                           |       |                                            |       |   |   |   |   |
| Financing  Activities:                                                                       |       |                                           |       |                                            |       |   |   |   |   |
| Change in short-term borrowings, net                                                         |       | (10,000                                        | )          | 8,898                                           |       | — |   | 200 |   |
| Principal payments on long-term borrowings                                                   |       | (5,937                                         | )          | (5,428                                          | )          | (173 | ) | — |   |
| Purchases of treasury stock                                                                  |       | —                                         |       | (3                                              | )          | — |   | (3 | ) |
| Dividends paid                                                                               |       | (2,405                                         | )          | (2,405                                          | )          | (2,405 | ) | (2,405 | ) |
| NET CASH  PROVIDED BY (USED IN)                                                              |       |                                           |       |                                            |       |   |   |   |   |
| FINANCING ACTIVITIES                                                                         |       | (18,342                                        | )          | 1,062                                           |       | (2,578 | ) | (2,208 | ) |
|                                                                                         |       |                                           |       |                                            |       |   |   |   |   |
| Effect of  exchange rates on cash                                                            |       | 1,634                                          |       | (570                                            | )          | 669 |   | 992 |   |
|                                                                                         |       |                                           |       |                                            |       |   |   |   |   |
| NET INCREASE  (DECREASE) IN CASH AND                                                         |       |                                           |       |                                            |       |   |   |   |   |
| CASH EQUIVALENTS                                                                             |       | 34,070                                         |       | (1,376                                          | )          | 14,082 |   | 188 |   |
|                                                                                         |       |                                           |       |                                            |       |   |   |   |   |
| Cash and cash  equivalents at the beginning of the period                                    |       | 42,380                                         |       | 48,860                                          |       | 62,368 |   | 47,296 |   |
|                                                                                         |       |                                           |       |                                            |       |   |   |   |   |
| CASH AND CASH  EQUIVALENTS AT THE END OF THE PERIOD                                          |       | $                                              | 76,450     |                                            | $          | 47,484 |   | $ | 76,450 |   | $ | 47,484 |   |

 

# *See accompanying notes.*

4

----

# **CUBIC CORPORATION**

NOTESTO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

June 30, 2007

**Note1 — Basis for Presentation**

The accompanying unaudited consolidated condensed financial statementshave been prepared in accordance with generally accepted accounting principlesfor interim financial information and with the instructions to Form 10-Q andArticle 10 of Regulation S-X. Accordingly, they do not include all informationand footnotes required by accounting principles generally accepted in the UnitedStates for complete financial statements.

In the opinion of management, all adjustments considered necessary fora fair presentation have been included. Operating results for the three andnine month periods ended June 30, 2007 are not necessarily indicative of theresults that may be expected for the year ending September 30, 2007. Forfurther information, refer to the consolidated financial statements andfootnotes thereto included in the Company’s annual report on Form 10-K for theyear ended September 30, 2006.

The preparation of the financial statements in conformity with U. S.generally accepted accounting principles requires management to make estimatesand assumptions that affect the reported amounts of assets and liabilities anddisclosure of contingent assets and liabilities at the date of the financialstatements and the reported amounts of revenues and expenses during thereporting period. Actual results could differ from those estimates.

### **Note 2 — Balance Sheet Details**

The components of accountsreceivable are as follows (in thousands):
| ** **                                | ** ** | **June 30,  2007** | ** ** | **September 30,  2006** | ** ** |
|-------------------------------------------|------------|-------------------------|------------|------------------------------|------------|
| ** **                                | ** ** | **(unaudited)**         | ** ** | ** **                   | ** ** |
| Trade and other  receivables              |       | $                       | 13,360     |                         | $          | 15,686 |   |
| Long-term contracts:                      |       |                    |       |                         |       |
| Billed                                    |       | 92,344                  |       | 71,215                       |       |
| Unbilled                                  |       | 223,907                 |       | 250,832                      |       |
| Allowance for doubtful  accounts          |       | (5,295                  | )          | (5,086                       | )          |
| Total accounts  receivable                |       | 324,316                 |       | 332,647                      |       |
| Less estimated amounts  not currently due |       | (16,300                 | )          | (2,200                       | )          |
| Current accounts  receivable              |       | $                       | 308,016    |                         | $          | 330,447 |   |

 

The amount classified as not currently due is an estimate of the amountof long-term contract accounts receivable that will not be collected within oneyear from June 30, 2007 under transportation systems contracts in the U.S.,Australia and the U.K. and a defense contract in Canada. The non-currentbalance at September 30, 2006 represented non-current amounts due from onetransportation systems contract in the U.K.

5

----

Inventoriesconsist of the following (in thousands):
| ** **                        | ** ** | **June 30,  2007** | ** ** | **September 30,  2006** | ** ** |
|-----------------------------------|------------|-------------------------|------------|------------------------------|------------|
| ** **                        | ** ** | **(unaudited)**         | ** ** | ** **                   | ** ** |
| Finished  products                |       | $                       | 629        |                         | $          | 563 |   |
| Work in process  and inventoried  |       |                    |       |                         |       |
| costs under long-term contracts   |       | 22,381                  |       | 16,194                       |       |
| Raw material and  purchased parts |       | 3,538                   |       | 3,452                        |       |
| Total  inventories                |       | $                       | 26,548     |                         | $          | 20,209 |   |

 

At June 30, 2007, work inprocess and inventoried costs under long-term contracts includes approximately$8.1 million in costs incurred in advance of contract award or outside thescope of work on several contracts, primarily in the defense segment. Suchcosts were $7.7 million as of September 30, 2006.  Management believes it is probable that thesecosts, plus appropriate profit margin, will be recovered under contract changeorders or upon the award of new contracts within the next year.

###### **Note 3 — Comprehensive Income**

###### Comprehensiveincome is as follows (in thousands):

|                                            | ** ** | **Nine Months Ended  June 30,** | ** ** | **Three Months Ended  June 30,** | ** ** |
|--------------------------------------------|------------|------------------------------------------------|------------|-------------------------------------------------|------------|
| ** **                                 | ** ** | **2007**                                       | ** ** | **2006**                                        | ** ** | **2007** | ** ** | **2006** | ** ** |
|                                       |       |                                           |       |                                            |       |   |   |   |   |
| Net income                                 |       | $                                              | 30,713     |                                            | $          | 17,214 |   | $ | 11,177 |   | $ | 5,976 |   |
| Foreign currency  translation adjustments  |       | 7,127                                          |       | 2,315                                           |       | 2,520 |   | 5,321 |   |
| Net unrealized  loss from cash flow hedges |       | —                                         |       | (425                                            | )          | 7 |   | (417 | ) |
| Comprehensive income                       |       | $                                              | 37,840     |                                            | $          | 19,104 |   | $ | 13,704 |   | $ | 10,880 |   |

 

6

----

**Note 4 — Segment Information**

Businesssegment financial data is as follows (in millions):
| ** **                    | ** ** | **Nine Months Ended  June 30,** | ** ** | **Three Months Ended  June 30,** | ** ** |
|-------------------------------|------------|------------------------------------------------|------------|-------------------------------------------------|------------|
| ** **                    | ** ** | **2007**                                       | ** ** | **2006**                                        | ** ** | **2007** | ** ** | **2006** | ** ** |
|                          |       |                                           |       |                                            |       |   |   |   |   |
| **Sales:**                    | ** ** | ** **                                     | ** ** | ** **                                      | ** ** | ** ** | ** ** | ** ** | ** ** |
| Defense                       |       | $                                              | 484.7      |                                            | $          | 422.1 |   | $ | 176.6 |   | $ | 149.4 |   |
| Transportation  systems       |       | 172.0                                          |       | 183.3                                           |       | 54.0 |   | 61.8 |   |
| Corporate and  other          |       | 10.0                                           |       | 11.2                                            |       | 3.1 |   | 3.7 |   |
| Total sales                   |       | $                                              | 666.7      |                                            | $          | 616.6 |   | $ | 233.7 |   | $ | 214.9 |   |
|                          |       |                                           |       |                                            |       |   |   |   |   |
| **Operating  income (loss):** | ** ** | ** **                                     | ** ** | ** **                                      | ** ** | ** ** | ** ** | ** ** | ** ** |
| Defense                       |       | $                                              | 35.1       |                                            | $          | 20.7 |   | $ | 13.7 |   | $ | 9.6 |   |
| Transportation  systems       |       | 13.3                                           |       | 1.5                                             |       | 4.1 |   | 1.1 |   |
| Corporate and  other          |       | (2.3                                           | )          | (1.8                                            | )          | (1.2 | ) | (0.4 | ) |
| Total operating  income       |       | $                                              | 46.1       |                                            | $          | 20.4 |   | $ | 16.6 |   | $ | 10.3 |   |

 

### **Note 5 — Financing Arrangements**

TheCompany has a committed five-year revolving credit agreement with a group offinancial institutions in the amount of $150 million, expiring in March 2010.As of June 30, 2007, there were no borrowings under this agreement; however,there were letters of credit outstanding under the agreement totaling $10.9million.

### **Note 6 — Pension Plans**

The components of netperiodic pension benefits costs are as follows (in thousands):
| ** **                      | ** ** | **Nine Months Ended  June 30,** | ** ** | **Three Months Ended  June 30,** | ** ** |
|---------------------------------|------------|------------------------------------------------|------------|-------------------------------------------------|------------|
| ** **                      | ** ** | **2007**                                       | ** ** | **2006**                                        | ** ** | **2007** | ** ** | **2006** | ** ** |
| Service cost                    |       | $                                              | 4,476      |                                            | $          | 6,261 |   | $ | 1,108 |   | $ | 2,133 |   |
| Interest cost                   |       | 7,212                                          |       | 6,594                                           |       | 2,400 |   | 2,228 |   |
| Expected return  on plan assets |       | (8,525                                         | )          | (7,253                                          | )          | (2,837 | ) | (2,449 | ) |
| Amortization of:                |       |                                           |       |                                            |       |   |   |   |   |
| Prior service cost              |       | 8                                              |       | 23                                              |       | 2 |   | 8 |   |
| Actuarial loss                  |       | 353                                            |       | 1,629                                           |       | 117 |   | 548 |   |
| Administrative  expenses        |       | 75                                             |       | 75                                              |       | 25 |   | 25 |   |
| Net pension cost                |       | $                                              | 3,599      |                                            | $          | 7,329 |   | $ | 815 |   | $ | 2,493 |   |

 

7

----

### **Note 7 — New Accounting Pronouncements**

In July 2006, the Financial Accounting Standards Board issuedInterpretation No. 48, *Accounting forUncertainty in Income Taxes*(FIN 48), which is effective for fiscalyears beginning after December 31, 2006. The purpose of FIN 48 is to clarifyand set forth consistent rules for accounting for uncertain tax positions inaccordance with FAS 109, *Accounting forIncome Taxes*. The cumulative effect of applying the provisions ofthis interpretation is required to be reported separately as an adjustment tothe opening balance of retained earnings in the year of adoption. Management isin the process of reviewing and evaluating FIN 48, and therefore the ultimateimpact of its adoption is not yet known.

In September 2006, the Financial AccountingStandards Board published FASB Statement of Financial Accounting Standards No.158 (SFAS 158), **Employers’ Accounting for Defined Benefit Pension andOther Postretirement Plans,**to require an employer to fullyrecognize the obligations associated with single-employer defined benefitpension, retiree healthcare, and other postretirement plans in their financialstatements. The new standard will be effective for the Company as of the end ofthe current fiscal year ending September 30, 2007. Under SFAS 158 , the Companywill recognize in its balance sheet an asset for each plan’s overfunded statusor a liability for each plan’s underfunded status and recognize, as a componentof other comprehensive income, the changes in the funded status of the plansthat arise during the year but are not recognized as components of net periodicbenefit cost. The measurement date provisions of SFAS 158 will have no impacton the Company’s financial statements because the Company already uses thebalance sheet date as the measurement date for its defined benefit pensionplans. Adoption of the statement will also have no impact on the Company’sConsolidated Statements of Income. It is not possible at this time to determinewhat impact adoption of the statement will have on the Consolidated BalanceSheet and on Other Comprehensive Income as of, and for the year ending,September 30, 2007. However, adoption of the statement would have had thefollowing incremental effects on the Consolidated Balance Sheet as of September30, 2006 (in thousands):
| ** **                                      | ** ** | **Before**   | ** ** | **Effect of** | ** ** | **After**    | ** ** |
|-------------------------------------------------|------------|--------------|------------|--------------------|------------|--------------|------------|
| ** **                                      | ** ** | **Adoption** | ** ** | **Adoption**       | ** ** | **Adoption** | ** ** |
| Balance Sheet  Line Item at September 30, 2006: |       |         |       |               |       |         |       |
| OTHER ASSETS  (non-current)                     |       |         |       |               |       |         |       |
| Deferred income taxes                           |       | $            | 7,360      |               | $          | 2,682        |       | $ | 10,042 |   |
| OTHER CURRENT  LIABILITIES                      |       |         |       |               |       |         |       |
| Accrued pension liability                       |       | 6,283        |       | —             |       | 6,283        |       |
| OTHER  LIABILITIES (non-current)                |       |         |       |               |       |         |       |
| Accrued pension liability                       |       | 18,208       |       | 7,664              |       | 25,872       |       |
| SHAREHOLDER’S  EQUITY                      |       |         |       |               |       |         |       |
| Accumulated  other comprehensive income         |       | 8,415        |       | (4,982             | )          | 3,433        |       |
|                                                 |            |              |            |                    |            |              |            |  |  |  |

 

8

----

### **CUBIC CORPORATION**

ITEM 2 - MANAGEMENT’S DISCUSSIONAND ANALYSIS OF FINANCIAL

CONDITIONAND RESULTS OF OPERATIONS

June30, 2007

Our two primary businesses are in the defense and transportation industries. These are high technology businesses that design, manufacture and integrate complex systems and provide essential services to meet the needs of various federal and regional government agencies in the U.S. and other nations around the world.

Cubic Defense Applications is a diversified supplierof constructive, live and virtual military training systems, services andcommunication systems and products to the U.S. Department of Defense, othergovernment agencies and allied nations. We design instrumented range systemsfor fighter aircraft, armored vehicles and infantry force-on-force livetraining; weapons effects simulations; laser-based tactical engagement andvirtual simulation systems; and precision gunnery solutions. Our services arefocused on training mission support,computer simulation training, distributed interactive simulation, developmentof military training doctrine, force modernization services for NATOentrants and field operations andmaintenance. Our communications products are aimed at intelligence,surveillance, and search and rescue markets.

Cubic Transportation Systems develops and deliversinnovative fare collection systems for public transit authoritiesworldwide.  We provide hardware, softwareand multi-agency, multimodal transportation integration technologies andservices that allow the agencies to efficiently collect fares, manage theiroperations, reduce shrinkage and make using public transit a more convenientand attractive option for commuters.

**Consolidated Overview**

Sales for the quarter ended June 30, 2007 increased 9% to $233.7 millioncompared to $214.9 million in the same quarter last year. All of the salesgrowth came from the defense segment while transportation systems salesdecreased for the quarter. Operating income increased to $16.6 million in thequarter compared to $10.3 million in the third quarter last year, with theimprovement coming from both segments.

Salesincreased to $666.7 million for the first nine months of the fiscal yearcompared to $616.6 million for the first nine months of 2006, an increase of8%. All of the sales increase came from the defense segment, whiletransportation systems sales decreased. Operating income for the first ninemonths of the fiscal year more than doubled, increasing from $20.4 million in2006 to $46.1 million this year. The operating income improvement came fromboth segments, with defense operating income increasing by $14.4 million andtransportation systems by $11.8 million compared to the first nine months of2006. See the segment discussions following for further analysis of segmentsales and operating income.

Net income for the third quarter of fiscal 2007 was $11.2 million, or42 cents per share, compared to $6.0 million, or 22 cents per share, last yeardue primarily to the increase in operating income. For the first ninemonths of the year, net income increased to $30.7 million, or $1.15 per share,from $17.2 million, or 64 cents per share last year. This year’s net income forthe first nine months was primarily from operations, while last year’s netincome included a gain on 

9

----

the sale of realestate of approximately $4.3 million, afterapplicable income taxes, or about 16 cents per share.

In December 2006, the U.S. Congress reinstated the Research andExperimentation (R&E) credit retroactive to January 1, 2006. As a result,we recorded a tax benefit of approximately $0.5 million (2 cents per share) inthe first quarter of fiscal 2007 that represents the expected R&E creditfor the nine-month period ended September 30, 2006, which was not previouslyreflected in our operating results.

Selling, general and administrative (SG&A) expenses in the thirdfiscal quarter increased over last year from $23.5 million to $25.3 millionthis year and decreased slightly as a percentage of sales from 10.9% to 10.8%.Most of the increase in SG&A expenses in the quarter came from the defensesegment, commensurate with the increase in sales, while transportation systemsSG&A increased slightly due to higher legal fees. For the first nine monthsof the year SG&A expenses increased over last year by $1.7 million, withall of the increase coming from the defense segment, while transportationsystems SG&A decreased slightly. Research and development expense decreasedin the first nine months this fiscal year compared to last year due primarilyto the completion of a project at the end of fiscal 2006 for the development ofnew weapons simulations systems for the small arms training systems productline. In addition, research and development efforts this year have been focusedprimarily on customer funded programs rather than company sponsored programs.

As a result of strongcash flows, interest and dividend income increased, while interest expensedecreased during the quarter and nine-month periods. In addition, currencyexchange gains on cash advances to our foreign subsidiaries added $0.2 millionand $0.8 million this year to other income for the quarter and nine-monthperiods, respectively. The net improvement this year over last year frominterest, dividends and other income, less interest expense, was $1.9 millionfor the quarter and $2.8 million for the nine-month period, before applicableincome taxes.

Our projected effective tax rate for fiscal 2007 is 35.6%; however, asmentioned above, the retroactive reinstatement of the U.S. R&E creditreduced the first quarter provision by about $0.5 million, thereby reducing thetax rate for the first three quarters of the year to 35.2%. The projectedeffective rate for fiscal 2007 is higher than last year’s effective ratethrough the first three quarters of 34.8% because we are now providing taxes onearnings in the U.K. at the higher U.S. rate as we do not consider the earningsto be permanently reinvested; however, this increase is partially offset by theestimated R&E credit we expect to realize in fiscal 2007. The effectiverate for fiscal 2007 could be affected by, among other factors, the mix ofbusiness between the U.S. and foreign jurisdictions, our ability to takeadvantage of available tax credits and audits of our records by taxingauthorities.

10

----

**Defense Segment**
| ** **                             | ** ** | **Nine Months Ended  June 30,** | ** ** | **Three Months Ended  June 30,** | ** ** |
|----------------------------------------|------------|------------------------------------------------|------------|-------------------------------------------------|------------|
| ** **                             | ** ** | **2007**                                       | ** ** | **2006**                                        | ** ** | **2007** | ** ** | **2006** | ** ** |
| ** **                             | ** ** | **(in millions)**                         | ** ** |
| **Defense Segment Sales**              | ** ** | ** **                                     | ** ** | ** **                                      | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** |
| Communications  and electronics (CEBU) |       | $                                              | 44.3       |                                            | $          | 48.4 |   | $ | 15.0 |   | $ | 15.5 |   |
| Readiness  systems (RSBU)              |       | 202.5                                          |       | 172.4                                           |       | 76.5 |   | 59.5 |   |
| Mission support  services (MSBU)       |       | 230.1                                          |       | 195.4                                           |       | 82.1 |   | 72.0 |   |
| Tactical systems  and other            |       | 7.8                                            |       | 5.9                                             |       | 3.0 |   | 2.4 |   |
|                                   |       | $                                              | 484.7      |                                            | $          | 422.1 |   | $ | 176.6 |   | $ | 149.4 |   |
|                                   |       |                                           |       |                                            |       |   |   |   |   |
| **Defense Segment Operating Income**   | ** ** | ** **                                     | ** ** | ** **                                      | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** |
| Communications  and electronics (CEBU) |       | $                                              | 0.1        |                                            | $          | 3.0 |   | $ | (0.9 | ) | $ | 0.8 |   |
| Readiness  systems (RSBU)              |       | 13.8                                           |       | 4.7                                             |       | 5.7 |   | 4.7 |   |
| Mission support  services (MSBU)       |       | 21.8                                           |       | 14.6                                            |       | 8.4 |   | 4.5 |   |
| Tactical systems  and other            |       | (0.6                                           | )          | (1.6                                            | )          | 0.5 |   | (0.4 | ) |
|                                   |       | $                                              | 35.1       |                                            | $          | 20.7 |   | $ | 13.7 |   | $ | 9.6 |   |
|                                        |            |                                                |            |                                                 |            |  |  |  |  |  |  |  |  |  |  |  |  |

 

Defense segment sales in the third quarter increased 18%to $176.6 million this year from $149.4 million last year and for thenine-month period increased 15% to $484.7 million from $422.1 million in 2006.The growth in sales came from both RSBU and MSBU, while CEBU sales decreased comparedto the third quarter and nine-month periods last year. The caption “Tacticalsystems and other” in the table above includes operating results of our 50%owned joint venture company as well as advanced programs for the development ofnew defense technologies.

Operating income in thedefense segment improved again in the third quarter this year to $13.7 millionfrom $9.6 million last year and for the nine-month period operating incomeincreased to $35.1 million from $20.7 million in 2006. Operating incomeincreased in both the MSBU and RSBU, while CEBU incurred an operating loss forthe quarter and essentially broke even for the nine-month period. The tactical systems joint venture companyincurred an operating loss of approximately $0.5 million in the third quarterthis year compared to $0.4 million last year. Operating income amounts in theabove table for the three and nine-month periods ended June 30, 2006 have beenrevised from previous reports to conform to the current method of allocatingcorporate costs to the business units.

**Communications and Electronics (CEBU)**

Sales from CEBU were $15.0 million in the third quarterof fiscal 2007 compared to $15.5 million in the same quarter last year, a 3%decrease. For the first nine months of the fiscal year, CEBU salesdecreased 8% from $48.4 million in 2006 to $44.3 million this year. Sales increased fromcontracts for the supply of data links for unmanned aerial vehicles in the U.K., however, these increases were offset by decreases in other data link sales,as well as sales of personnel locator systems and surveillance receivers.

CEBU operating incomedecreased from $0.8 million in the third quarter last year to an operating lossof $0.9 million in the third quarter this year. Cost growth of $1.8 million ona contract for 

11

----

the development of a newdata link system was the cause of this decrease. For the nine-month period,estimated costs on this contract grew a total of $3.2 million, resulting in adecrease in operating income from $3.0 million in 2006 to $0.1 million thisyear. Improved profit margins from the sale of power amplifiers andsurveillance receivers were largely offset by decreased sales and profitmargins from other data link contracts and personnel locator systems.

**Readiness Systems (RSBU)**

RSBU sales for the quarter increased 29%, from $59.5million in the third quarter last year to $76.5 million this year. For thenine-month period, sales increased 17% from $172.4 million last year to $202.5million this year. New task orders for development of the next generation aircombat training system in addition to a new contract for an Australian aircombat training system resulted in higher air combat training sales. Groundcombat training systems sales also increased, due primarily to increased salesto a customer in the Far East. Sales of small arms training systems increasedfor the quarter compared to last year, but were down for the nine-month perioddue to a delay in start up of production earlier in the year resulting from agovernment funding delay.

Readiness systemsoperating income improved from $4.7 million in the third quarter last year to$5.7 million this year. Higher sales of air combat training systems, small armstraining systems and a ground combat training system in the Far East contributedto the increase in operating income. This increase was partially offset by costgrowth of $1.6 million in the quarter for the development of a ground combattraining system in the Middle East. For the nine-month period, operating incomeincreased from $4.7 million in 2006 to $13.8 million this year due to higherprofits from air and ground combat training systems and small arms trainingsystems. Higher sales volume contributed to the increase, as well as higherprofit margins from sales to the customer in the Far East. In addition,operating income from small arms training systems improved this year due to thecompletion last year of the development of new weapons simulations systems.Further adding to the profit improvement in RSBU for the nine-month period wasthe settlement of a previously disputed amount on a contract completed in themid-1990’s, totaling $1.2 million.

**Mission Support Services (MSBU)**

MSBU sales increased 14% to $82.1 million in the thirdquarter this year, compared to $72.0 million last year. For the first ninemonths of the fiscal year, MSBU sales increased 18%, from $195.4 million in2006 to $230.1 million this year. Higher sales from live and constructivetraining support activities, contracts for modeling the effects of weapons ofmass destruction and from other mission support activities contributed to theincrease in sales.

Mission support services operating incomeincreased from $4.5 million in the third quarter last year to $8.4 million thisyear, while operating income for the first nine months of the fiscal yearimproved from $14.6 million in 2006 to $21.8 million this year. The increase inoperating income was due to the increase in sales volume and improved profitmargins on several live and constructive training support contracts, includinghigher fees awarded by the customer for performance.

12

----

**TransportationSystems Segment**
| ** **                               | ** ** | **Nine Months Ended  June 30,** | ** ** | **Three Months Ended  June 30,** | ** ** |
|------------------------------------------|------------|------------------------------------------------|------------|-------------------------------------------------|------------|
| ** **                               | ** ** | **2007**                                       | ** ** | **2006**                                        | ** ** | **2007** | ** ** | **2006** | ** ** |
| ** **                               | ** ** | **(in millions)**                         | ** ** |
|                                     |       |                                           |       |                                            |       |   |   |   |   |
| Transportation  Segment Sales            |       | $                                              | 172.0      |                                            | $          | 183.3 |   | $ | 54.0 |   | $ | 61.8 |   |
|                                     |       |                                           |       |                                            |       |   |   |   |   |
| Transportation Segment  Operating Income |       | $                                              | 13.3       |                                            | $          | 1.5 |   | $ | 4.1 |   | $ | 1.1 |   |

 

Transportationsegment sales decreased 13% from $61.8 million in the third quarter last yearto $54.0 million this year. For the first nine months of the fiscal year, salesdecreased 6% from $183.3 million to $172.0 million. The decrease resulted fromlower sales on system installation contracts in North America and Sweden, aswell as from a service contract in the U.K. that was phased-out because oldticket issuing equipment was replaced by modern equipment requiring lessmaintenance. These decreases were partially offset by increased sales in theU.K. due to the strong British Pound, which caused the dollar value of sales inthe U.K. to increase approximately $2.1 million for the third quarter and $7.9million for the first nine months when compared to average exchange ratesexperienced last year.

Operatingincome from transportationsystems improved to $4.1 million in the third quarter this year compared to$1.1 million last year. Cost growth on North American and Australian systeminstallation contracts was reduced to $1.1 million in the third quarter thisyear, compared to $4.8 million last year. In addition, operating income fromthe Prestige contract in London increased by nearly $2 million during the thirdquarter compared to last year, including bonuses earned for system usage andthe effect of a higher currency exchange rate, which added $0.3 million tooperating income when compared to the 2006 exchange rate. Lower operatingincome from the U.K. service contract described above and from spare partssales in the U.S. partially offset these improvements. In addition, higherlegal fees further reduced operating income for the quarter by $0.9 million.

Forthe nine-month period, operating income increased to $13.3 million this yearfrom $1.5 million last year. Settlements were reached in the first and secondquarters with three customers, adding $8.6 million to operating income,although we also added $3.4 million to our estimate of costs to complete two ofthese contracts, yielding a net improvement to operating income of $5.2 millionfrom these contract settlements. Operating income from the Prestige contract inLondon increased nearly $6 million compared to last year, including bonusesearned for system usage and the effect of a higher currency exchange rate,which added $1.3 million to operating income when compared to the 2006 exchangerate. Cost growth on North American system installation contracts for the ninemonth period was about $ 6.3 million this year compared to $13.6 million lastyear, helping to improve operating income, although cost growth in the first quarter this year on acontract in Sweden resulted in an increase of approximately $3.9 million in ourestimate to complete that contract. As mentioned above, lower operating income from a U.K. servicecontract and from spare parts sales in the U.S. partially offset theseimprovements. In addition, higher legal fees this year further reducedoperating income for the nine-month period by $1.4 million compared to lastyear.

13

----

**Backlog**

As reflected in the table below, total backlog increased approximately$534 million at June 30, 2007 compared to September 30, 2006. Transportationsystems backlog increased $94 million, while defense backlog increased $440million during the nine-month period. In June 2007, the Company was awarded acontract with a potentialceiling value of $468 million to provide highly realistic pre-deploymenttraining to U.S. troops at the U.S. Army’s Joint Readiness Training Center atFort Polk, Louisiana. The contract includes one base year with nine renewableoption years. Funded backlog increased $122 million during theperiod, with transportation systems increasing $94 million and defense fundedbacklog increasing by $28 million. Of the increase in transportation systems backlogduring the nine-month period, approximately $38 million was the result ofstrengthening of the British Pound vs. the U.S. Dollar between September 30,2006 and June 30, 2007.
| ** **                     | ** ** | **June 30,  2007** | ** ** | **September 30,  2006** | ** ** |
|--------------------------------|------------|-------------------------|------------|------------------------------|------------|
| ** **                     | ** ** | **(in millions)**  | ** ** |
| **Total backlog**              | ** ** | ** **              | ** ** | ** **                   | ** ** | ** ** | ** ** |
| Transportation systems         |       | $                       | 809.9      |                         | $          | 715.6 |   |
| Defense:                       |       |                    |       |                         |       |
| Communications and electronics |       | 54.1                    |       | 71.9                         |       |
| Training systems               |       | 328.6                   |       | 285.9                        |       |
| Mission support services       |       | 787.0                   |       | 366.4                        |       |
| Tactical systems and other     |       | 32.7                    |       | 38.8                         |       |
| Total defense                  |       | 1,202.4                 |       | 763.0                        |       |
| Total                          |       | $                       | 2,012.3    |                         | $          | 1,478.6 |   |
|                           |       |                    |       |                         |       |
| **Funded backlog**             | ** ** | ** **              | ** ** | ** **                   | ** ** | ** ** | ** ** |
| Transportation systems         |       | $                       | 809.9      |                         | $          | 715.6 |   |
| Defense:                       |       |                    |       |                         |       |
| Communications and electronics |       | 54.1                    |       | 71.9                         |       |
| Training systems               |       | 328.6                   |       | 285.9                        |       |
| Mission support services       |       | 121.2                   |       | 112.2                        |       |
| Tactical systems and other     |       | 32.7                    |       | 38.8                         |       |
| Total defense                  |       | 536.6                   |       | 508.8                        |       |
| Total                          |       | $                       | 1,346.5    |                         | $          | 1,224.4 |   |
|                                |            |                         |            |                              |            |  |  |  |  |  |  |

 

In defense, the difference between total backlog and funded backlogrepresents options under multi-year service contracts. Funding for thesecontracts comes from annual operating budgets of the U.S. government and theoptions are normally exercised annually. Options for the purchase of additionalsystems or equipment are not included in backlog until exercised nor areindefinite delivery, indefinite quantity contracts until an order is received.

14

----

###### **Liquidityand Capital Resources**

Operating activities provided cash of $69.8 millionfor the first nine months of the fiscal year. In addition to net income for theperiod, customer advances and reductions in accounts receivable and prepaidexpenses contributed to the positive cash flows. Positive operating cash flowscame from both the transportation systems and defense segments, with themajority coming from the transportation systems segment.

Investing activities for the nine-month period included capitalexpenditures of $6.8 million and investment in short-term investments of $12.3million. During the first nine months, we repaid $10.0 million borrowed on ashort-term basis, made scheduled payments on our long-term debt of $5.9 millionand paid dividends of $2.4 million to our shareholders.

Ourfinancial condition remains strong with working capital of $293.7 million and acurrent ratio of 2.7 to 1 at June 30, 2007. We expect that cash on hand and ourunused lines of credit will be adequate to meet our liquidity requirements forthe foreseeable future.

**Critical Accounting Policies, Estimates and Judgments**

Our financial statements are prepared in accordance with accounting principles that are generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. We continually evaluate our estimates and judgments, the most critical of which are those related to revenue recognition, income taxes, valuation of goodwill and pension costs. We base our estimates and judgments on historical experience and other factors that we believe to be reasonable under the circumstances. Materially different results can occur as circumstances change and additional information becomes known.

Besides the estimates identified above that are considered critical, we make many other accounting estimates in preparing our financial statements and related disclosures. All estimates, whether or not deemed critical affect reported amounts of assets, liabilities, revenues and expenses, as well as disclosures of contingent assets and liabilities. These estimates and judgments are also based on historical experience and other factors that are believed to be reasonable under the circumstances. Materially different results can occur as circumstances change and additional information becomes known, even for estimates and judgments that are not deemed critical.

For further information, refer to theconsolidated financial statements and notes thereto included in the Company’sannual report on Form 10-K for the year ended September 30, 2006.

**CAUTIONARY STATEMENT ABOUTFORWARD-LOOKING INFORMATION**

This report,including the documents that we incorporate by reference, containsforward-looking statements within the meaning of Section 21E of the SecuritiesExchange Act of 1934, as amended, that are subject to the “safe harbor” createdby those sections. Any statements about our expectations, beliefs, plans,objectives, assumptions or future events or our future financial and/oroperating performance are not historical and may be forward-looking. Thesestatements are often, but not always, made through the use of words or phrasessuch as “may,” “will,” “anticipate,” “estimate,” “plan,” “project,”“continuing,” “ongoing,” “expect,” “believe,” 

15

----

“intend,”“predict,” “potential,” “opportunity” and similar words or phrases or thenegatives of these words or phrases. These statements involve estimates, assumptions and uncertainties,including those discussed in “Risk Factors” inthe Company’s annual report on Form 10-K for the year ended September 30, 2006,and throughout this filing that could cause actual results to differmaterially from those expressed in these statements.

Because the riskfactors referred to above could cause actual results or outcomes to differmaterially from those expressed in any forward-looking statements made by us oron our behalf, you should not place undue reliance on any forward-lookingstatements.  In addition, past financialand/or operating performance is not necessarily a reliable indicator of futureperformance and you should not use our historical performance to anticipateresults or future period trends. Further, any forward-looking statement speaks only as of the date onwhich it is made, and we undertake no obligation to update any forward-lookingstatement to reflect events or circumstances after the date on which thestatement is made or to reflect the occurrence of unanticipated events. Newfactors emerge from time to time, and it is not possible for us to predictwhich factors will arise. In addition, we cannot assess the impact of eachfactor on our business or the extent to which any factor, or combination offactors, may cause actual results to differ materially from those contained inany forward-looking statements.

ITEM4 - STATEMENT ON DISCLOSURE CONTROLS AND PROCEDURES.

We maintain disclosurecontrols and procedures, including internal control over financial reporting,which are designed to ensure that information required to be disclosed in ourperiodic filings with the SEC is reported within the time periods specified inthe SEC’s rules and forms, and to provide reasonable assurance that assets aresafeguarded and transactions are properly executed and recorded. Our disclosurecontrols and procedures are also designed to ensure that information isaccumulated and communicated to our management, including our Chief ExecutiveOfficer (CEO) and Chief Financial Officer (CFO), as appropriate, to allowtimely decisions regarding required disclosure. In designing and evaluatingsuch controls and procedures, we recognize that any controls and procedures, nomatter how well designed and operated, can provide only reasonable assurance ofachieving the desired control objectives, and management necessarily isrequired to use its judgment in evaluating the cost-benefit relationship ofpossible controls and procedures.

We routinely review our system of internalcontrol over financial reporting and make changes to our processes and systemsto improve controls and increase efficiency, while ensuring that we maintain aneffective internal control environment. Changes may include such activities asimplementing new, more efficient systems and migrating certain processes fromour operating units to our corporate shared service center. In addition, if weacquire new businesses, we will review the controls and procedures of theacquired business as part of our integration activities.

We performed an evaluation of theeffectiveness of our disclosure controls and procedures as of June 30, 2007.The evaluation was performed with the participation of senior management ofeach business segment and key corporate functions, and under the supervision ofthe CEO and CFO. Based on our evaluation, we concluded that our disclosurecontrols and procedures were effective as of June 30, 2007.

There were no changes in our internal controlover financial reporting during the most recently completed fiscal quarter thatmaterially affected, or are reasonably likely to materially affect, ourinternal control over financial reporting.

16

----

**PART II -OTHER INFORMATION**

ITEM 6 - EXHIBITS

(a)The following exhibits are included herein:
| **Exhibit No.** | ** ** | **Description**                                                                                                                                                       |
|-----------------|------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  3.1       |       | Amended and Restated Certificate of Incorporation.  Incorporated by reference to Form 10-Q filed for the quarter ended June, 30,  2006, file No. 1-8931, Exhibit 3.1. |
|  3.2       |       | Bylaws. Incorporated by reference to Form 10-K filed  for the fiscal year ended September 30, 2004, file No. 1-8931, Exhibit 3.                                       |
| 10.1            |       | 2005 Equity Incentive Plan. Incorporated by  reference to Form 10-K filed for the fiscal year ended September 30, 2005,  file No. 1-8931, Exhibit 10.1.               |
| 10.2            |       | Transition Protection Plan. Incorporated by  reference to Form 10-K filed for the fiscal year ended September 30, 2005,  file No. 1-8931, Exhibit 10.2.               |
| 10.3            |       | Credit Agreement dated March 10, 2005. Incorporated  by reference to Form 10-Q for the quarter ended March 31, 2005, file No.  1-8931, Exhibit 10.                    |
| 10.4            |       | Deferred Compensation Plan Summary. Incorporated by  reference to Form 8-K filed April 6, 2005, file No. 1-8931, Exhibit 10.                                          |
| 10.5            |       | Employment Agreement.                                                                                                                                                 |
| 15              |       | Report of Independent Registered Public Accounting  Firm                                                                                                              |
| 31.1            |       | Certification of CEO                                                                                                                                                  |
| 31.2            |       | Certification of CFO                                                                                                                                                  |
| 32.1            |       | CEO Certification                                                                                                                                                     |
| 32.2            |       | CFO Certification                                                                                                                                                     |

SIGNATURES

Pursuant to the requirements ofthe Securities Exchange Act of 1934, the registrant has duly caused this reportto be signed on its behalf by the undersigned thereunto duly authorized.
|        |           |   | CUBIC CORPORATION                   |   |
|--------|----------------|--------|-------------------------------------|--------|
|   |           |   |                                |   |
|   |           |   |                                |   |
| Date   | August 1, 2007 |   | /s/ W. W. Boyle                     |   |
|   |           |   |  W. W. Boyle                   |   |
|   |           |   |  Senior Vice President and CFO |   |
|   |           |   |                                |   |
| Date   | August 1, 2007 |   | /s/ Mark A. Harrison                |   |
|   |           |   | Mark A. Harrison                    |   |
|   |           |   | Vice President and Controller       |   |

 

17

----