United States
                     Securities and Exchange Commission
                            Washington, DC 20549


                                  Form 10-K

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


                For the fiscal year ended September 30, 2005


                        Commission File Number 1-9788


                               LANDAUER, INC.
            ----------------------------------------------------
           (Exact name of registrant as specified in its charter)


                Delaware                           06-1218089
      (State or other jurisdiction              (I.R.S. Employer
      of incorporation or organization)         Identification Number)


                  2 SCIENCE ROAD, GLENWOOD, ILLINOIS 60425
            (Address of principal executive offices and zip code)


     Registrant's telephone number, including area code: (708) 755-7000


         Securities registered pursuant to Section 12(b) of the Act:

      COMMON STOCK WITH PAR VALUE OF $.10       NEW YORK STOCK EXCHANGE
            (Title of each class)                (Name of exchange on
                                                  which registered)


         Securities registered pursuant to Section 12(g) of the Act:

                                    None


      Indicate by check mark if the Registrant is a well-known seasoned
issuer, as defined in Rule 405 of the Securities Act. Yes [   ]  No [ X ]

      Indicate by check mark if the Registrant is not required to file
reports pursuant to Section 13 or Section 15(d) of the Act.
Yes [  ]  No [ X ]

      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 if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of Registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K.  [ X ]





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<PAGE>


      Indicate by check mark whether the Registrant is an accelerated filer
(as defined in Rule 12b-2 of the Act).  Yes [ X ]  No [   ]

      Indicate by check mark whether the Registrant is a shell company (as
defined in Rule 12b-2 of the Act).  Yes [   ]  No [ X ]

      As of March 31, 2005 the aggregate market value of the voting and
nonvoting common equity (based upon the closing price on the New York Stock
Exchange) held by non-affiliates was approximately $411,000,000. The number
of shares of common stock ($.10 per value) outstanding as of December 9,
2005 was 9,033,530.


                     DOCUMENTS INCORPORATED BY REFERENCE

      Portions of the Registrant's definitive Proxy Statement in connection
with the February 9, 2006 Annual Meeting of Stockholders (the "Proxy
Statement") are incorporated by reference into Part III of this Annual
Report on Form 10-K.



















































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<PAGE>


                                    INDEX


Item                                                                Page
----                                                                ----

PART I
      1.    Business
              General Description. . . . . . . . . . . . . . . .       4
              Marketing and Sales. . . . . . . . . . . . . . . .       5
              Seasonality. . . . . . . . . . . . . . . . . . . .       6
              International Activities . . . . . . . . . . . . .       6
              Patents. . . . . . . . . . . . . . . . . . . . . .       6
              Raw Materials. . . . . . . . . . . . . . . . . . .       6
              Competition. . . . . . . . . . . . . . . . . . . .       7
              Research and Development . . . . . . . . . . . . .       7
              Environmental and Other Governmental
                Regulations. . . . . . . . . . . . . . . . . . .       8
              Employees and Labor Relations. . . . . . . . . . .       8
              Available Information. . . . . . . . . . . . . . .       8
      1A.   Risk Factors . . . . . . . . . . . . . . . . . . . .       9
      1B.   Unresolved Staff Comments. . . . . . . . . . . . . .      11
      2.    Properties . . . . . . . . . . . . . . . . . . . . .      11
      3.    Legal Proceedings. . . . . . . . . . . . . . . . . .      11
      4.    Submission of Matters to a Vote of
              Security Holders . . . . . . . . . . . . . . . . .      11

PART II
      5.    Market for Registrant's Common Equity,
              Related Stockholder Matters and
              Issuer Purchases of Equity Securities. . . . . . .      11
      6.    Selected Financial Data. . . . . . . . . . . . . . .      12
      7.    Management's Discussion and Analysis of
              Financial Condition and Results of Operations. . .      13
      7A.   Quantitative and Qualitative Disclosures
              About Market Risk. . . . . . . . . . . . . . . . .      21
      8.    Consolidated Financial Statements and
             Supplementary Data
              Consolidated Balance Sheets. . . . . . . . . . . .      22
              Consolidated Statements of Income. . . . . . . . .      24
              Consolidated Statements of Stockholders'
                Investment and Comprehensive Income. . . . . . .      25
              Consolidated Statements of Cash Flows. . . . . . .      26
              Notes to Consolidated Financial Statements . . . .      28
              Report of Independent Registered
                Public Accounting Firm . . . . . . . . . . . . .      44
      9.    Changes in and Disagreements with Accountants
              on Accounting and Financial Disclosure . . . . . .      46
      9A.   Controls and Procedures. . . . . . . . . . . . . . .      46
      9B.   Other Information. . . . . . . . . . . . . . . . . .      46

PART III
      10.   Directors and Executive Officers of
              the Registrant . . . . . . . . . . . . . . . . . .      47
      11.   Executive Compensation . . . . . . . . . . . . . . .      47
      12.   Security Ownership of Certain Beneficial Owners
              and Management and Related Stockholder
              Matters. . . . . . . . . . . . . . . . . . . . . .      47
      13.   Certain Relationships and Related Transactions . . .      48
      14.   Principal Accounting Fees and Services . . . . . . .      48

PART IV
      15.   Exhibits, Financial Statement Schedules
              Financial Statements . . . . . . . . . . . . . . .      48
              List of Exhibits . . . . . . . . . . . . . . . . .      48
              Signatures . . . . . . . . . . . . . . . . . . . .      51
              Quarterly Financial Data (Unaudited) . . . . . . .      52



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                                   PART I

ITEM 1.  BUSINESS

GENERAL DESCRIPTION

      Landauer, Inc. is a Delaware corporation organized on December 22,
1987 to carry on the radiation monitoring business previously established
by Tech/Ops, Inc. ("Tech/Ops"). On February 6, 1991, the Company changed
its name from Tech/Ops Landauer, Inc. to Landauer, Inc. As used herein, the
"Company" or "Landauer" refers to Landauer, Inc. and its subsidiaries.

      The Company's shares are listed on the New York Stock Exchange under
the symbol LDR. As of September 30, 2005, there were 9,029,793 shares
outstanding.

      Substantially all of the Company's revenues are realized from
radiation monitoring services and other services incidental to radiation
dose measurement. The Company enters into agreements with customers to
provide them with radiation monitoring services, generally for a twelve-
month period, and such agreements have a high degree of renewal.
Relationships with customers are generally stable and recurring, and the
Company provides customers with on-going services. As part of its services,
the Company provides radiation detection badges, which are produced and
owned by the Company, to its customers. The badges are worn for a period
selected by the customers ("wear period"), which is usually one, two, or
three months in duration. At the end of the wear period, the badges are
returned to the Company for analysis. The Company analyzes the badges that
have been worn and provides its customers with a report indicating their
radiation exposures. The Company recycles certain badge components for
reuse, while also producing replacement badges on a continual basis.

      The Company offers its service for measuring the dosages of x-ray,
gamma radiation and other penetrating ionizing radiations to which the
wearer has been exposed, primarily through optically stimulated luminescent
("OSL") badges worn by client personnel. This technology is marketed under
the trade name Luxel+<registered trademark>. While most of the Company's
revenues are domestic, these services are also marketed by Landauer in
Canada and by its subsidiaries in other parts of the world. On October 1,
1998, the Company acquired a 75% interest in SAPRA-Landauer, Ltda., which
provides radiation dosimetry services in Brazil. On December 28, 1998,
SAPRA-Landauer acquired the radiation dosimetry service business formerly
conducted by REM in Sao Paulo, Brazil. During July 1999, the Chinese
government approved the Company's joint venture agreement with China
National Nuclear Corporation to form Beijing-Landauer, Ltd., which provides
radiation monitoring services in China. Landauer, Inc. owns a 70% interest
in Beijing-Landauer.

      On April 2, 2002, the Company completed an agreement to merge its
European operations with the radiation monitoring business operated by
Laboratoire Central des Industries Electriques ("LCIE"), a wholly-owned
subsidiary of Bureau Veritas ("BV"), a professional services company
involved in quality, health and safety, and environmental management. Under
the agreement, Landauer exchanged its United Kingdom radiation monitoring
business and certain technologies for a 51% controlling interest in the new
company named LCIE-Landauer, Ltd. LCIE contributed its radiation monitoring
business, all of which is located in France. LCIE-Landauer has its
headquarters and laboratory in Fontenay-aux-Roses, a Paris suburb. LCIE-
Landauer serves France-based customers from this location and will continue
to serve the United Kingdom customers from Oxford, England. As part of the
formation of the new entity, LCIE-Landauer purchased the Philips France
radiation monitoring business and also serves these customers from the
Fontenay-aux-Roses laboratory. In April 2004, Landauer consummated an
agreement with BV to acquire the remaining 49% minority interest in LCIE-
Landauer, Ltd. owned by BV's subsidiary, LCIE, for $10.4 million in cash.





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<PAGE>


      Landauer's activities also include the operations of Nagase-Landauer,
Ltd., a 50%-owned joint venture in Japan involved in radiation monitoring
in that country. Nagase-Landauer commenced operations in 1974.

      Landauer operates a crystal manufacturing facility in Stillwater,
Oklahoma that it acquired in August 1998. Crystal material is a component
in the Company's OSL technology.

      Landauer's InLightTM dosimetry system, introduced in 2003, provides
small and mid-sized in-house and commercial laboratories with the ability
to provide in-house radiation monitoring services using OSL technology.
InLight services may involve a customer acquiring or leasing dosimetry
devices as well as analytical reading equipment from the Company. The
system is based on the Company's proprietary technology and instruments,
and dosimetry devices developed by Mitsushita Industrial Equipment Company
and allows customers the flexibility to tailor their precise dosimetry
needs.

      Landauer's operations include services for the measurement and
monitoring of radon gas (referred to as "sales of radon kits"). Its wholly-
owned subsidiary, HomeBuyer's Preferred, Inc., offers a radon monitoring
service and, when necessary, remediation to purchasers of personal
residences. Testing requires the customer to deploy a radon detector and
return the detector to the Company's laboratories for dose determination
and reporting. The Company may assist with remediation services on
properties where radon measurements exceed a specified threshold. The
service is targeted to corporate employee relocation programs.

      Other radiation measurement-related services (ancillary services)
augment the basic radiation measurement services that the Company offers,
providing administrative and informational tools to customers for the
management of their radiation safety programs.

MARKETING AND SALES

      Landauer's dosimetry services are marketed in the U.S. and Canada
primarily by full-time Company personnel located in Illinois, California,
Connecticut, Georgia, and Texas. The Company's services are marketed
through ventures in Japan, Brazil and China, as well as its wholly owned
subsidiary operating in the United Kingdom and France. Other firms and
individuals market the Company's services on a commission basis, primarily
to small customers.

      Worldwide, the Company and its affiliates serve approximately 60,000
customers representing approximately 1.5 million individuals. Typically, a
client will contract for one year of service in advance, representing
monthly, bimonthly or quarterly badges, readings, and reports. Sales are
made principally on a subscription basis. Customer relationships in the
radiation monitoring market served by the Company are generally stable and
recurring. Deferred contract revenue, as shown on the consolidated balance
sheet, represents advance payment for services to be rendered. At September
30, 2005 and 2004, deferred contract revenue was $12,702,000 and
$12,554,000, respectively.

      The Company's radiation monitoring services are largely based on the
Luxel+ dosimeter system in which all analyses are performed at the
Company's laboratories in Glenwood, Illinois. Luxel+ employs the Company's
proprietary OSL technology. Recently, the Company introduced the InLight
dosimetry system that enables certain customers to make their own
measurements using OSL technology. InLight is marketed to the smaller
radiation measurement laboratories found at nuclear power plants, military
installations, national research laboratories, and commercial services.
InLight also forms the basis for Landauer's European operations and other
future operations that might occur where local requirements preclude using
a U.S. or other foreign-based laboratory. The medical physics market, where
there is a need to perform dosimetry associated with the use of radiation
in diagnostic and therapeutic radiology, is also served by the InLight
dosimetry system.


                                      5


<PAGE>


      Radon gas detection kits are marketed directly by the Company
primarily to institutional customers and government agencies. The
HomeBuyer's Preferred<registered trademark> Radon Protection Plan service
agreement is marketed directly by Landauer to companies and to their
corporate relocation service providers for the benefit of purchasers of
residences incident to transfers of personnel.

SEASONALITY

      The services provided by the Company to its customers are ongoing and
are of a subscription nature. As such, revenues are recognized in the
periods in which such services are rendered, irrespective of whether
invoiced in advance or in arrears. Given the subscription nature of
Landauer's services, quarterly revenues are fairly consistent. During the
second quarter of each fiscal year, however, the Company provides
additional services for reporting annual radiation dose summaries that
generate increased revenues. The introduction of the Company's InLight
product line may result in some variability in quarter-to-quarter revenue
comparisons given the nature of purchase cycles associated with sales of
radiation dose measurement instruments and detectors.

INTERNATIONAL ACTIVITIES

      Information regarding the Company's activities by geographic region
is contained under the footnote "Geographic Information" on page 42 of this
Annual Report on Form 10-K.

PATENTS

      The Company holds exclusive worldwide licenses to patent rights for
certain technologies that measure and image radiation exposure to
crystalline materials when stimulated with light. These licenses were
acquired by the Company from Battelle Memorial Institute and Oklahoma State
University as part of collaborative efforts to develop and commercialize a
new generation of radiation dosimetry technology. These licenses expire
from the years 2011 through 2015.

      As of September 30, 2005, the Company is using OSL technology to
provide dosimetry services to essentially all of its domestic and many of
its international customers. These licenses and systems represent an
important proprietary component of the OSL based radiation monitoring
services and products sold under the trade names Luxel, Luxel+ and InLight.
Additionally, the Company holds certain patents that relate to various
dosimeter designs, radiation measurement materials and methods, and optical
data storage techniques using aluminum oxide generated from the Company's
research and development activities. These patents expire in 2017 through
2022.

      Landauer believes that its business is primarily dependent upon the
Company's technical competence, the quality, reliability and price of its
services and products, and its prompt and responsive performance.

      Rights to inventions of employees working for Landauer are assigned
to the Company.

RAW MATERIALS

      The Company has multiple sources for many of its raw materials and
supplies, and believes that the number of sources and availability of items
are adequate. Landauer internally produces certain of its requirements,
such as OSL detector materials and plastic badge holders. All crystal
materials used in the Company's OSL technology are produced at the
Company's crystal manufacturing facility in Stillwater, Oklahoma. The
InLight dosimetry system and its components are manufactured by Matsushita
Industrial Equipment Company under an exclusive agreement. If the Company
were to lose availability of its Stillwater facility or materials from
Matsushita due to a fire, natural disaster or other disruptions, such loss
could have a material adverse effect on the Company and its operations.


                                      6


<PAGE>


COMPETITION

      In the United States, Landauer competes against a number of dosimetry
service providers. One of these providers, Global Dosimetry Solutions,
Inc., is a significant competitor with substantial resources. Other
competitors in the United States that provide dosimetry services tend to be
smaller companies, some of which operate on a regional basis. Outside of
the United States, radiation monitoring activities are conducted by a
combination of private entities and government agencies.

      The Japanese market is served by the Company through its 50%-owned
joint venture, Nagase-Landauer, Ltd. In early 1995, the Company began
offering radiation monitoring services to customers in Canada following
approval of the Company's devices by Canadian authorities. The Company
began offering service to customers in China during fiscal 2000. Customers
in Brazil are served through the Company's joint venture, SAPRA-Landauer,
Ltda., while customers in the United Kingdom and France are served through
the Company's wholly owned subsidiary, LCIE-Landauer Ltd., by its
laboratory in suburban Paris, France and sales office in Oxford, England.

      In the United States, most government agencies, such as the
Department of Energy and Department of Defense, have their own in-house
radiation monitoring services, as do many large private nuclear power
plants.

      The Company competes on the basis of advanced technologies, competent
execution of these technologies, the quality, reliability and price of its
services, and its prompt and responsive performance. The Company's InLight
dosimetry system, while competitive with a number of systems offered by
other companies, is believed to provide the only OSL-based radiation
monitoring system.

      Radon gas detection services represent a market where Landauer has
many large and small competitors, many of whom use short-term charcoal
detectors rather than the Company's long-term alpha-track detectors. The
HomeBuyer's Preferred Radon Protection Plan represents a product sold
exclusively to the corporate relocation market through firms providing
relocation services and directly to corporate customers.

RESEARCH AND DEVELOPMENT

      Presently, research efforts seek to expand the use of OSL,
particularly as it applies to radiation measurements in therapeutic and
diagnostic radiology and nuclear medicine, as well as to environmental
radiation dosimetry. The InLight dosimetry system, recently released for
commercial application, provides the Company's subsidiaries and other small
dosimetry laboratories with an economical approach to practice the OSL
technology.

      The Company's technological expertise has been an important factor in
its growth. The Company regularly pursues product improvements to maintain
its technical position. The development of OSL dosimetry, announced in
1994, was funded by the Company in its collaborative effort with Battelle
Memorial Institute and Oklahoma State University. The Company
commercialized this technology beginning in 1998 and has converted most of
its customers to the new technology.

      The Company also participates regularly in several technical
professional societies, both domestic and international, that are active in
the fields of health physics and radiation detection and monitoring.

      In fiscal 2005, 2004, and 2003, the Company spent $1,704,000,
$1,758,000, and $1,819,000, respectively, on research and development
activities.






                                      7


<PAGE>


ENVIRONMENTAL AND OTHER GOVERNMENTAL REGULATIONS

      The Company believes that it complies with federal, state and local
provisions that have been enacted or adopted regulating the discharge of
materials into the environment or otherwise protecting the environment.
This compliance has not had, nor is it expected to have, a material effect
on the capital expenditures, financial condition, liquidity, results of
operations, or competitive position of Landauer.

      Many of the Company's technology based services must comply with
various national and international standards that are used by regulatory
and accreditation bodies for approving such services and products. These
accreditation bodies include, for example, the National Voluntary
Laboratory Accreditation Program in the U.S. and governmental agencies,
generally, in international markets. Changes in these standards and
accreditation requirements can result in the Company having to incur costs
to adapt its offerings and procedures. Such adaptations may introduce
quality assurance issues during transition that need to be addressed to
ensure timely and accurate analyses and data reporting. Additionally,
changes affecting radiation protection practices, including new
understandings of the hazards of radiation exposure and amended
regulations, may impact how the Company's services are used by its
customers and may, in some circumstances, cause the Company to alter its
products and delivery of its services.

EMPLOYEES AND LABOR RELATIONS

      As of September 30, 2005, the Company employed approximately 450
full-time employees worldwide. As a matter of policy, Landauer seeks to
maintain good relations with employees at all locations.

AVAILABLE INFORMATION

      As a reporting company, Landauer is subject to the informational
requirements of the Securities Exchange Act of 1934 (the "Exchange Act")
and, accordingly, files its annual report on Form 10-K, quarterly reports
on Form 10-Q, current reports on Form 8-K, proxy statements and other
information with the Securities and Exchange Commission (the "SEC"). The
public may read and copy any materials filed with the SEC at the SEC's
Public Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549.
Please call the SEC at (800) SEC-0330 for further information on the Public
Reference Room. As an electronic filer, Landauer's public filings are
maintained on the SEC's Internet site that contains reports, proxy and
information statements, and other information regarding issuers that file
electronically with the SEC. The address of that website is
http://www.sec.gov. In addition, Landauer's annual report on Form 10-K,
quarterly reports on Form 10-Q, current reports on Form 8-K and amendments
to those reports filed or furnished pursuant to Section 13(a) or 15(d) of
the Exchange Act may be accessed free of charge through Landauer's website
as soon as reasonably practicable after Landauer has electronically filed
such material with, or furnished it to, the SEC. The address of Landauer's
website is http://www.landauerinc.com.

      A copy of the Company's Annual Report on Form 10-K is available upon
the written request of any shareholder.















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ITEM 1A. RISK FACTORS

      In addition to factors discussed elsewhere in this Annual Report on
Form 10-K, the following are important factors that could cause actual
results or events to differ materially from those contained in any forward-
looking statement made by or on behalf of the Company.

WE RELY ON A SINGLE FACILITY FOR THE MANUFACTURING AND PROCESSING OF OUR
PRODUCTS AND SERVICES.

      Landauer conducts its primary manufacturing and laboratory processing
operations from a single facility in Glenwood, Illinois. In addition, the
Company performs significant functions for some of its international
operations from the Glenwood facility. If the Company were to lose
availability of its primary facility due to fire, natural disaster or other
disruptions, the Company's operations could be significantly impaired.
Although the Company maintains business interruption insurance, there can
be no assurance that the proceeds of such insurance would be sufficient to
offset any loss the Company might incur or that the Company would be able
to retain its customer base if operations were so disrupted.

WE RELY ON A SINGLE FACILITY FOR THE MANUFACTURING OF CRYSTAL MATERIAL, A
KEY COMPONENT IN OUR OSL TECHNOLOGY.

      Crystal material is a key component in Landauer's OSL technology. The
Company operates a single crystal manufacturing facility in Stillwater,
Oklahoma that currently supplies all OSL crystal radiation measurement
material used by the Company. If the Company were to lose availability of
its Stillwater facility due to a fire, natural disaster or other
disruptions, such loss could have a significant adverse effect on the
Company and its operations. Although multiple sources for raw crystal
material exist, there can be no assurance that the Company could secure
another source to produce finished crystal materials to Landauer's
specification in the event of a disruption at the Stillwater facility.

IF WE ARE UNABLE TO DEVELOP NEW TECHNOLOGIES, OUR FINANCIAL CONDITION AND
RESULTS OF OPERATIONS COULD BE MATERIALLY AND ADVERSELY AFFECTED.

      Landauer's technological expertise has been an important factor in
its growth. The Company regularly pursues product improvements to maintain
its technical position. The development and introduction of new
technologies, the adaptability of OSL to new platforms and new formats, the
usefulness of older technologies as well as the introduction of new
technologies by the competition present various risks to the Company's
business. The failure or lack of market acceptance of a new technology or
the inability to respond to market requirements for new technology could
adversely affect the Company's operations or reputation with customers. The
cancellation of technology projects or the cessation of use of an existing
technology can result in write-downs and charges to the Company's earnings.
In the normal course of its business, Landauer must record and process
significant amounts of data quickly and accurately and relies on various
computer and telecommunications equipment and software systems. Any failure
of such equipment or systems could adversely affect the Company's
operations.

BECAUSE A PORTION OF OUR BUSINESS IS CONDUCTED OUTSIDE OF THE UNITED
STATES, ADVERSE INTERNATIONAL DEVELOPMENTS COULD NEGATIVELY IMPACT OUR
BUSINESS AND RESULTS OF OPERATIONS.

      Landauer conducts business in numerous international markets such as
Japan, France, the United Kingdom, Brazil, Canada and China. Foreign
operations are subject to a number of special risks, including, among
others, currency exchange rate fluctuations; disruption in relations;
political and economic unrest; trade barriers; exchange controls;
expropriation; and changes in laws and policies, including those governing
foreign owned operations.




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<PAGE>


OUR BUSINESS IS SUBJECT TO EXTENSIVE DOMESTIC AND FOREIGN GOVERNMENT
REGULATIONS, WHICH COULD INCREASE OUR COSTS, CAUSE US TO INCUR LIABILITIES
AND ADVERSELY AFFECT OUR RESULTS OF OPERATION.

      Regulation, present and future, is a constant factor affecting the
Company's business. The radiation monitoring industry is subject to
federal, state, and international governmental regulation. Unknown matters,
new laws and regulations, or stricter interpretations of existing laws or
regulations may materially affect Landauer's business or operations in the
future and/or could increase the cost of compliance.

      Many of the Company's technology-based services must comply with
various national and international standards that are used by regulatory
and accreditation bodies for approving such services and products. Changes
in these standards and accreditation requirements can result in the Company
having to incur costs to adapt its offerings and procedures. Such
adaptations may introduce quality assurance issues during transition that
need to be addressed to ensure timely and accurate analyses and data
reporting. Additionally, changes affecting radiation protection practices,
including new understandings of the hazards of radiation exposure and
amended regulations, may impact how the Company's services are used by its
customers and may, in some circumstances, cause the Company to alter its
products and delivery of its services.

FLUCTUATIONS IN CURRENCY EXCHANGE RATES COULD ADVERSELY AFFECT OUR RESULTS.

      The Company is exposed to market risk, including changes in foreign
currency exchange rates and interest rates. The financial statements of the
Company's non-U.S. subsidiaries are remeasured into U.S. dollars using the
U.S. dollar as the functional currency. To date, the market risk associated
with foreign currency exchange rates has not been material in relation to
the Company's financial position, results of operations, or cash flows.
These risks could increase, however, as the Company expands in
international markets. The Company does not have any significant trade
accounts receivable, trade accounts payable, or commitments in a currency
other than that of the reporting unit's functional currency. As such, the
Company does not currently use derivative financial instruments to manage
the exposure in its non-U.S. operations.

WE MAY FACE COMPETITORS, SEVERAL OF WHICH HAVE GREATER FINANCIAL AND OTHER
RESOURCES.

      The Company competes on the basis of advanced technologies, competent
execution of these technologies, the quality, reliability and price of its
services and its prompt and responsive performance. In much of the world,
radiation monitoring activities are conducted by a combination of private
entities and governmental agencies. The Company's primary competitor in the
United States is large and has substantial resources. The Company also
faces competitive pressures from a number of smaller competitors.

WE ARE SUBJECT TO INTERNAL CONTROLS EVALUATIONS AND ATTESTATION
REQUIREMENTS OF SECTION 404 OF THE SARBANES-OXLEY ACT OF 2002.

      Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, the
Company's management must perform evaluations of the Company's internal
controls over financial reporting. Beginning as of the end of fiscal 2005
and annually thereafter, the Company must include with its Form 10-K a
report on management's assessment of the adequacy of such internal
controls, and the Company's independent registered public accounting firm
must publicly attest to the adequacy of management's assessment and the
effectiveness of our internal controls.  The Company has prepared and
implemented a plan of action for compliance. Compliance with these
requirements is complex and time-consuming. If the Company fails to timely
or successfully comply with the requirements of Section 404, or if its
independent registered public accounting firm does not timely attest to the
evaluation, the Company could be subject to increased regulatory scrutiny
and the public's perception of the Company may change.



                                     10


<PAGE>


ITEM 1B. UNRESOLVED STAFF COMMENTS

      At September 30, 2005, the Company does not have any unresolved
written comments from the Commission staff regarding its periodic or
current reports under the Act.

ITEM 2. PROPERTIES

      Landauer owns three adjacent buildings totaling approximately 60,000
square feet in Glenwood, Illinois, about 30 miles south of Chicago. The
properties house the Company's administrative offices, laboratory, assembly
and reading operations, and warehouse. The properties and equipment of the
Company are in good condition and, in the opinion of management, are
suitable and adequate for the Company's operations. The Company maintains a
crystal growth facility in Stillwater, Oklahoma and maintains laboratories
in Japan, Brazil, China, and France, as well as a sales office in Oxford
England.

ITEM 3. LEGAL PROCEEDINGS

      The Company is a party, from time to time, to various legal
proceedings, lawsuits and other claims arising in the ordinary course of
its business. The Company does not believe that any such litigation pending
as of September 30, 2005, if adversely determined, would have a material
effect on its business, financial position, results of operations, or cash
flows.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

      There were no matters submitted to a vote of security holders during
the three months ended September 30, 2005.



                                   PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER
        MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

      The Company's common stock is traded on the New York Stock Exchange
under the trading symbol LDR, since its listing in January 2002.
Previously, the Company's common stock was traded on the American Stock
Exchange. A summary of market prices of the Company's common stock is set
forth in the table on page 52 of this Annual Report on Form 10-K. As of
December 9, 2005, there were approximately 600 shareholders of record.
There were no sales of unregistered securities of the Company and no
repurchases of equity securities of the Company during fiscal 2005 by the
Company.

      The Company has paid regular quarterly cash dividends since January
1990. The Company also paid special cash dividends in 1990 and 1992. On
November 28, 2005, the Company announced that it had increased the regular
quarterly cash dividend by 6% to $0.45 per share for the first quarter of
fiscal 2006. This increase represents an annual rate of $1.80 per share
compared with $1.70 paid in fiscal 2005. A summary of cash dividends paid
for the last two years is set forth in the table on page 52 of this Annual
Report on Form 10-K.













                                     11


<PAGE>


ITEM 6. SELECTED FINANCIAL DATA


                      FIVE YEAR SELECTED FINANCIAL DATA
                       LANDAUER, INC. AND SUBSIDIARIES



                             (Dollars in Thousands Except Per Share Data)
                             --------------------------------------------
For the years
ended September 30,          2001     2002    2003(1)   2004(2)  2005(3)
-------------------         -------  -------  -------   -------  -------
OPERATING RESULTS
-----------------

Net revenues . . . . . . .  $53,028  $58,608  $64,818   $69,809  $75,221

Operating income . . . . .   21,874   24,399   23,857    27,720   26,551

Net income . . . . . . . .   14,324   16,180   15,019    17,770   17,208

Diluted net income
  per share. . . . . . . .  $  1.64  $  1.83  $  1.69   $  1.98  $  1.90

Cash dividends
  per share. . . . . . . .  $  1.40  $  1.40  $  1.50   $  1.60  $  1.70

Total assets . . . . . . .  $50,550  $60,257  $64,238   $77,518  $85,859

----------

  (1) Fiscal 2003 includes an asset impairment charge of $2,750,000 related
      to the Company's Aurion product line, offset by $500,000 lower
      incentive compensation expense. The resulting decline in operating
      income of $2,250,000 lowered diluted earnings per share by $0.15
      (after income tax benefit of $894,000).

  (2) The Company acquired the remaining 49% minority interest in LCIE
      Landauer, Ltd in fiscal 2004.

  (3) Fiscal 2005 includes a management reorganization charge of
      $2,300,000, reducing net income by $1,386,000 (after income tax
      benefit of $914,000) or $0.15 per diluted share.


























                                     12


<PAGE>


ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
         AND RESULTS OF OPERATIONS

OVERVIEW

      Landauer is a leading provider of analytical services to determine
occupational and environmental radiation exposure. For over 50 years, the
Company has provided complete radiation dosimetry services to hospitals,
medical and dental offices, universities, national laboratories, and other
industries in which radiation poses a potential threat to employees.
Landauer's services include the manufacture of various types of radiation
detection monitors, the distribution and collection of the monitors to and
from clients, and the analysis and reporting of exposure findings. These
services are provided to approximately 1.5 million individuals in the U.S.,
Japan, France, the United Kingdom, Brazil, Canada, China, Australia and
other countries.

      Substantially all of the Company's revenues are realized from
radiation monitoring services and other services incidental to radiation
dose measurement. The Company enters into agreements with customers to
provide them with radiation monitoring services, generally for a twelve-
month period; these agreements generally have a high degree of renewal.
Relationships with customers are generally stable and recurring, and the
Company provides customers with on-going services. As part of its services,
the Company provides its customers with radiation detection badges that are
produced and owned by the Company. The badges are worn for a period
selected by the customers ("wear period"), generally one, two, or three
months in duration. At the end of the wear period, the badges are returned
to the Company for analysis. The Company analyzes the badges that have been
worn and provides its customers with a report indicating radiation
exposures. The Company recycles certain badge components for reuse, while
also producing replacement badges on a continual basis. Additional
reporting and other radiation measurement and management services
("ancillary services") are provided to customers at their option.

      Landauer's InLight dosimetry system, introduced in late fiscal 2003,
provides smaller in-house and commercial laboratories the ability to offer
a complete radiation monitoring service. The system is based on the
Company's propriety OSL technology and instruments and dosimetry devices
developed by Matsushita Industrial Equipment Company, and allows customers
the flexibility to tailor their precise dosimetry needs. InLight services
may involve a customer acquiring or leasing dosimetry detectors and reading
equipment from the Company.

      Landauer's operations include services for the measurement and
monitoring of radon gas (referred to as "sales of radon kits") and services
related to the remediation of radon gas, which require the customer to
deploy a radon detector and return the detector to the Company's
laboratories for dose determination and reporting. Where a customer has
purchased a radon services agreement, the Company may assist with
remediation services on properties where radon measurements exceed a
specified threshold.

      Combined InLight and radon related products and services currently
represent less than 5% of consolidated revenues.

      Landauer operates a mature business, and growth in numbers of
customers is modest. In recent years, the Company's strategy has been to
expand into new international markets, primarily by partnering with
existing dosimetry service providers with a prominent local presence. In
addition, the Company has been developing new platforms and formats for its
OSL technology, such as InLight, to gain access to markets where the
Company previously did not have a significant presence, such as smaller in-
house and commercial laboratories. Revenue growth in recent years has
occurred as a result of increased prices for certain services, entry into
new markets through joint ventures and acquisitions, modest unit growth,
and new ancillary services and products.



                                     13


<PAGE>


      The services provided by the Company to its customers are ongoing and
of a subscription nature. As such, revenues are recognized in the periods
in which such services are rendered, irrespective of whether invoiced in
advance or in arrears. Given the subscription nature of Landauer's
services, quarterly revenues are fairly consistent. During the second
quarter of each fiscal year, however, the Company provides additional
services of reporting annual radiation dose summaries that generate
increased revenues. The introduction of the Company's InLight product line
may result in some variability in quarter-to-quarter revenue comparisons,
given the nature of purchase cycles associated with sales of radiation dose
measurement instruments and detectors.

RESULTS OF OPERATIONS

FISCAL 2005 COMPARED TO FISCAL 2004

      Revenues reported for fiscal 2005 were $75,221,000, an increase of
7.8% compared with revenues of $69,809,000 reported for fiscal 2004.
Domestic revenue growth for fiscal 2005 was $2,500,000, or 4.5%, and was
attributable to gains in pricing, unit volume and ancillary service fees
for the Company's core radiation monitoring business. International revenue
growth was $1,700,000, or 14.6%, for the year and reflected continued
favorable currency translation, pricing gains and unit volume in most
foreign markets. The InLight product line contributed the balance of
revenue growth of $1,200,000 for 2005.

      Costs and expenses for fiscal 2005 grew by almost $6,600,000 compared
with 2004. In September 2005, Landauer recognized expense in the amount of
$2,300,000 associated with various organizational changes, including early
retirement incentives and related pension benefit expenses arising from the
retirement of the Company's former chief executive officer, recruitment
expenses related to the recent election of a new chief executive officer
and severance and other costs related to additional personnel changes. The
resulting decline in operating income by $2,300,000 reduced net income by
$1,386,000 (after income tax benefit of $914,000) and lowered fiscal 2005
diluted earnings per share by $0.15. Exclusive of the reorganization
charge, costs and expenses for 2005 increased by approximately $4,300,000,
or 10.2%, primarily due to increased costs associated with foreign
operations including the effect of foreign currency translation and
operations growth, $1,500,000; higher depreciation and amortization,
$1,138,000; higher professional fees and outside services costs for
Sarbanes-Oxley compliance, information services support and marketing
studies, $1,098,000; higher postage costs, $235,000; and increased direct
labor, $157,000.

      Net other income was higher in 2005 primarily due to higher Nagase-
Landauer, Ltd. earnings compared with 2004. Landauer's 2004 acquisition of
the remaining equity in LCIE-Landauer resulted in lower minority interest
expense compared with a year ago. The effective tax rate for 2005 was 38.0%
compared with 37.4% for 2004 as a result of higher state income taxes and
lower foreign tax credits this year.

      Net income for the year just ended was $17,208,000, a decrease of
3.2% compared with net income of $17,770,000 for fiscal 2004 with resulting
diluted earnings per share for the current year at $1.90 compared with
$1.98 reported a year ago.

FISCAL 2004 COMPARED TO FISCAL 2003

      Revenues reported for fiscal 2004 were $69,809,000, an increase of
7.7% compared with revenues of $64,818,000 reported for fiscal 2003.
Domestic revenue growth during fiscal 2004, at 6.4%, was attributable to
gains in pricing, unit volume and ancillary service fees for the Company's
core radiation monitoring business. International revenue growth was more
than 14% for the year and reflected favorable currency translation, pricing
gains and unit volume in most foreign markets.




                                     14


<PAGE>


      The comparison of 2004 results with fiscal 2003 reflects the
recognition of a non-cash asset impairment charge, related to Landauer's
Aurion service, in the amount of $2,750,000 in 2003, offset by lower
incentive compensation expense in the amount of $500,000. The resulting
decline in fiscal 2003 operating income of $2,250,000 lowered diluted
earnings per share by $0.15 (after income tax benefit of $894,000).
Exclusive of the non-cash charge, costs and expenses for fiscal 2004 grew
by $3,878,000 due to increased labor, incentive compensation and employee
benefits expenses, $1,977,000, combined; costs associated with foreign
operations, $887,000, impacted by expansion and currency translation;
depreciation, $524,000; professional fees, $211,000 and direct materials,
$206,000. The increased costs and expenses were impacted by the development
of the InLight product line and the introduction of Luxel+.

      Net other income was $80,000 higher in 2004 as Nagase-Landauer, Ltd.
earnings improved $216,000 from 2003, offset by lower net interest income
of $136,000 due to financing costs associated with the acquisition of the
remaining interest in LCIE-Landauer early in fiscal 2004. The effective tax
rate for 2004 was 37.4% compared with 36.9% for 2003. Net income for fiscal
2004 was $17,770,000, an increase of 18.3% compared with net income of
$15,019,000 for fiscal 2003; $369,000 of the net income increase is
attributable to foreign currency. Diluted earnings per share for fiscal
2004 were $1.98 compared with $1.69 reported in fiscal 2003.

FOURTH QUARTER RESULTS OF OPERATIONS

   Revenues for the fourth fiscal quarter of 2005 were $18,990,000, an
increase of 8.1% compared with $17,566,000 a year ago. Revenue growth
during the fourth quarter of fiscal 2005 was attributable to modest gains
in pricing, unit volume, and a weak U.S. dollar versus the Euro
contributing to international increases. Costs and expenses for the fourth
quarter of fiscal 2005 were $3,100,000, or 29% higher than for the same
period a year ago and primarily reflect the $2,300,000 in expense
associated with the organizational changes effected in September 2005.
Exclusive of the reorganization expense, costs and expenses were slightly
more than $800,000 higher compared to the prior year period, primarily
reflecting increased costs for depreciation and amortization expense,
$260,000; professional and outside services fees, $187,000; indirect labor,
$63,000; real estate taxes, $50,000; and international expenses including
the effect of foreign currency translation, $173,000. Additionally, income
tax expense for the fourth quarter of fiscal 2005 was higher as the result
of a change in the overall effective tax rate for 2005, due to higher state
taxes and lower foreign tax credits. Net income for the quarter ended
September 30, 2005 was $3,104,000 compared with earnings of $4,532,000 in
the same quarter a year ago. Earnings per diluted share for the quarter
were $0.34 compared with $0.50 in 2004.

OUTLOOK FOR FISCAL 2006

      Landauer's business plan for fiscal 2006 anticipates aggregate
revenue growth for the year to be in the range of 5 - 6%, with revenues
from the Company's traditional domestic and international revenue expected
to grow at a slightly lower rate. Sales for the InLight service line are
expected to comprise the balance of revenue growth. Both domestic and
international revenue growth are expected to result from a mix of higher
pricing, moderate unit growth and increased sales of ancillary services.
Costs and operating expenses for fiscal 2006 are expected to grow at an
aggregate rate of 3 - 5%; excluding the $2,300,000 organizational charges
recorded in fiscal 2005, costs and expenses are anticipated to grow 8 -
10%. Net other income in fiscal 2006 is anticipated to be moderately higher
than fiscal 2005, and minority interest should be comparable to fiscal 2005
levels. The effective income tax rate for fiscal 2006 is expected to be
comparable to 2005 at approximately 37.5 - 38%. Resulting net income for
2006 is anticipated to be higher by 7 - 9% compared with fiscal 2005.






                                     15


<PAGE>


LIQUIDITY AND CAPITAL RESOURCES

      Landauer's cash flows, as shown in the statement of cash flows, can
differ from year to year as a result of the Company's operating, investing,
and financing activities.

      Investing activities included acquisitions of property, plant and
equipment in the amounts of $4,068,000, $4,773,000 and $4,715,000,
respectively, in fiscal 2005, 2004 and 2003, as well as the investment in
LCIE-Landauer of $10,404,000 in fiscal 2004. Cash paid for income taxes was
$10,501,000, $10,156,000, and $9,086,000, respectively, in fiscal 2005,
2004 and 2003.

      The Company's financing activities are comprised of credit facility
activities and payments of cash dividends to shareholder and minority
partners, offset partially by proceeds from the exercise of stock options
and, in 2004 and 2003, foreign dividends received from Nagase-Landauer,
Ltd., the Company's Japanese joint venture, and the Company's subsidiary in
Brazil. During fiscal 2005, 2004 and 2003, the Company paid cash dividends
of $15,002,000, or $1.70 per share; $13,990,000, or $1.60 per share; and
$12,977,000, or $1.50 per share, respectively, and such amounts have been
provided from operations.

      The Company has long-term liabilities in the amount of $7,300,000 and
$5,162,000 at September 30, 2005 and 2004, respectively, and its
requirement for cash flows to support investing activities is generally
limited. Capital expenditures for fiscal 2006 are expected to be
approximately $6,500,000, principally for the acquisition of equipment to
support the Company's InLight service line, introduction of new products,
the development of supporting software systems, and computer hardware. The
Company anticipates that funds for these capital improvements will be
provided from operations.

      As described in Note 6 to the financial statements, the Company
maintains a credit facility, which expires in March 2006. The credit
facility permits borrowing up to a maximum of $15,000,000. In April 2004,
the Company borrowed $7,724,000 to acquire the remaining 49% minority
interest in LCIE-Landauer Ltd. At September 30, 2005 and 2004, outstanding
borrowings under the credit agreement were $4,048,000 and $5,262,000,
respectively. The borrowings are classified as current liabilities and are
denominated in euros, which is the functional currency of LCIE-Landauer,
Ltd. In the event the credit facility is not renewed at maturity, it is
expected that cash on hand, cash flow from operations, and the Company's
borrowing capacity will be sufficient to satisfy the obligation. In the
opinion of management, cash flows from operations and the Company's
borrowing capacity under its line of credit are adequate for projected
operations and capital spending programs, as well as continuation of the
regular cash dividend program. From time to time, the Company may have the
opportunity to make investments for acquisitions or other purposes, and
borrowings can be made under the credit facility to fund such investments.
The Company intends to renew the credit facility prior to expiration.

      Landauer requires limited working capital for its operations since
many of its customers pay for services in advance. Such advance payments,
reflected on the balance sheet as "Deferred Contract Revenue", amounted to
$12,702,000 and $12,554,000, respectively, as of September 30, 2005 and
2004. While these amounts represent approximately 43% and 44% of current
liabilities, respectively as of September 30, 2005 and 2004, such amounts
generally do not represent a cash requirement.

      All customers are invoiced in accordance with the Company's standard
terms, with payment due thirty days from date of invoice. Considering the
Company's invoicing practices and that a significant portion of the
Company's revenues are subject to health care industry reimbursement
cycles, the average days of sales outstanding for the Company have ranged
from 43 to 78 days over the course of fiscal 2005 and fiscal 2004.




                                     16


<PAGE>


      Landauer offers radiation monitoring services in the United Kingdom,
Canada, Japan, Brazil, China, and France. The Company's operations in these
markets generally do not depend on significant capital resources.

      The Company is exposed to market risk, including changes in foreign
currency exchange rates and interest rates. As discussed in Note 1,
"Summary of Significant Accounting Policies" to the consolidated financial
statements, the financial statements of the Company's non-U.S. subsidiaries
are remeasured into U.S. dollars using the U.S. dollar as the functional
currency. The market risk associated with foreign currency exchange rates
is not material in relation to the Company's financial position, results of
operations, or cash flows. The Company does not have any significant trade
accounts receivable, trade accounts payable, commitments or borrowings in a
currency other than that of the reporting units' functional currencies. As
such, the Company does not use derivative financial instruments to manage
the exposure in its non-U.S. operations.

CONTRACTUAL OBLIGATIONS

      As of September 30, 2005, the resources required for scheduled
payment of contractual obligations were as follows:

                                  Scheduled payments by fiscal year
                             -------------------------------------------
(Dollars in                                                       There-
Thousands)                   Total     2006   2007-08   2009-10   after
-----------                 -------  -------  -------   -------  -------
Notes payable (1). . . . .  $ 4,048  $ 4,048  $    --   $    --  $    --
Interest payable (2) . . .       66       66       --        --       --
Operating leases (3) . . .      734      366      337        31       --
Purchase obligations (4) .    4,336    4,336       --        --       --
Postretirement
  benefits (5) . . . . . .    3,912      894      305       613    2,100
Dividends (6). . . . . . .    3,815    3,815       --        --       --
                            -------  -------  -------   -------  -------

                            $16,911  $13,525  $   642   $   644  $ 2,100
                            =======  =======  =======   =======  =======
----------

  (1) Notes payable pertain to the line of credit with a maturity
      date of March 25, 2006. The credit agreement is annually renewable
      upon agreement of the parties.

  (2) Interest payable is computed through the March 25, 2006 line of
      credit maturity date using 3.37%, the rate at which the line of
      credit is fixed through January 25, 2006.

  (3) The Company has several small operating leases that are short-term
      in nature; it has no material operating or capital leases.

  (4) Includes accounts payable under other agreements to purchase goods
      or services including open purchase orders.

  (5) Includes expected contributions to the Company's defined benefit
      pension plan in fiscal 2006 and estimated future benefit payments for
      the supplemental key executive retirement plans and a terminated
      retirement plan that provides certain retirement benefits payable to
      non-employee directors.

  (6) Cash dividends in the amount of $0.425 per share were declared on
      September 6, 2005 and paid on October 7, 2005.








                                     17


<PAGE>


NEW ACCOUNTING PRONOUNCEMENTS

      In October 2004, the American Jobs Creation Act (the "Act") was
signed into law. The Act includes a temporary incentive for U.S.
corporations to repatriate accumulated income earned abroad by providing an
85 percent dividends-received deduction for certain qualifying cash
dividends received from controlled foreign corporations. The Act also
includes a deduction related to U.S. manufacturing income of 3% of eligible
income in 2005 and 2006. These deductions are subject to certain
limitations and, as of September 30, 2005, uncertainty remains as to how
certain provisions of the Act will be interpreted. Therefore, the Company
is not in a position as of September 30, 2005 to determine whether, and to
what extent, it would repatriate unremitted foreign earnings or deduct
eligible manufacturing income. In addition, the Financial Accounting
Standards Board ("FASB") released FASB Staff Position No. FAS 109-1 (FSP
109-1), "Application of FASB Statement No. 109, 'Accounting for Income
Taxes', for the Tax Deduction Provided to U.S.-Based Manufacturers by the
American Jobs Creation Act of 2004." This FSP clarifies that the tax
deduction for domestic manufacturers under the American Jobs Creation Act
of 2004 should be accounted for as a special deduction in accordance with
FASB Statement No. 109, "Accounting for Income Taxes" (FAS 109). In
December 2004, the FASB released FSP 109-2, "Accounting and Disclosure
Guidance for the Foreign Earnings Repatriation Provision within the
American Jobs Creation Act of 2004", which provides enterprises more time
(beyond the financial-reporting period during which the Act took effect) to
evaluate the Act's impact on the enterprise's plan for reinvestment or
repatriation of certain foreign earnings for purposes of applying FASB
Statement No. 109, "Accounting for Income Taxes" (FAS 109). The Company
continues to evaluate the impact that the final standard and the Staff
Positions will have on the Company's results of operations and financial
statements.

      In November 2004, the FASB issued Statement of Financial Accounting
Standards ("SFAS") No. 151, "Inventory Cost." This Statement amends the
guidance in Accounting Research Bulletin No. 43, Chapter 4, "Inventory
Pricing", to clarify the accounting for abnormal amounts of idle facility
expense, freight, handling costs, and wasted material (scrap). SFAS No. 151
requires that those items be recognized as current-period charges. In
addition, this Statement requires that the allocation of fixed production
overheads to the costs of conversion be based on the normal capacity of the
production facilities. The provisions of SFAS No. 151 are effective for
inventory costs incurred in fiscal years beginning after June 15, 2005. As
such, the Company is required to adopt these provisions at the beginning of
fiscal year 2006. The Company does not believe that implementing SFAS
No. 151 will have a material impact on its consolidated financial
statements.

      In December 2004, the FASB issued SFAS 123R, "Share-Based Payment."
This revised standard addresses the accounting for share-based payment
transactions in which a company receives employee services in exchange for
either equity instruments of the company or liabilities that are based on
the fair value of the company's equity instruments or liabilities that may
be settled by the issuance of such equity instruments. Under the new
standard, companies will no longer be able to account for share-based
compensation transactions using the intrinsic method, in accordance with
APB 25. Instead, companies will be required to account for such
transactions using a fair-value method and recognize the expense in the
consolidated statement of income. In April 2005, the SEC approved a new
rule that delays the effective date of SFAS 123R for public companies to
annual, rather than interim, periods that begin after June 15, 2005.  In
addition, the SEC issued Staff Accounting Bulletin ("SAB") No. 107, "Share-
Based Payment" in March 2005, which provides supplemental SFAS 123R
guidance based on the views of the SEC. Further guidance to be used in the
implementation of SFAS 123R has been issued in FSP Nos. FAS 123(R)-1,
"Classification and Measurement of Freestanding Financial Instruments
Originally Issued in Exchange for Employee Services under FASB Statement
No. 123(R)", FAS 123(R)-2, "Practical Accommodation to the Application of



                                     18


<PAGE>


Grant Date as Defined in FASB Statement No. 123(R)", and FAS 123(R)-3,
"Transition Election Related to Accounting for the Tax Effects of Share-
Based Payment Awards". The Company has assessed the impact of SFAS 123R on
its consolidated financial statements and adopted SFAS 123R beginning
October 1, 2005, using the modified-prospective application method and the
Black-Scholes valuation for stock options issued prior to September 30,
2005. Fiscal 2006 expense for stock options and restricted stock grants
issued prior to October 1, 2006 is not expected to be material.

INFLATION

      The Company strives to reflect the inflationary impact of materials,
labor and other operating costs and expenses in its prices. The market for
the services and products that the Company offers, however, is highly
competitive, and in some cases has limited the ability of the Company to
offset inflationary cost increases.

FORWARD LOOKING STATEMENTS

      Certain matters contained in this report are forward-looking
statements, including, without limitation, the information contained under
the heading "Outlook for Fiscal 2006" in Item 7 of this report and
statements concerning the development and introduction of new technologies,
the adaptability of OSL to new platforms and new formats (such as InLight),
the usefulness of older technologies, the cost associated with the
Company's business development and research efforts, the valuation of the
Company's long-lived assets or business units relative to future cash
flows, the anticipated results of the operations of the Company and its
subsidiaries or ventures, the Company's business plans, foreign exchange
risks, government regulations, changes in pricing of products and services,
changes in postal and delivery practices, the Company's market position,
anticipated revenue and cost growth, the risks of conducting business
internationally, other anticipated financial events, the effects of
changing economic and competitive conditions, government regulations,
accreditation requirements, assumptions used for management's estimates,
and pending accounting announcements. Such assumptions may not materialize
to the extent assumed and such risks and uncertainties may cause actual
results to differ from anticipated results. Such risks and uncertainties
may also result in changes to the Company's business plan and prospects and
could create the need, from time to time, to write down the value of the
assets or otherwise cause the Company to incur unanticipated expenses.
Additional information may be obtained by reviewing the information set
forth in Item 1A. "Risk Factors" and Item 7A. "Quantitative and Qualitative
Disclosures About Market Risk" and information contained in the Company's
reports filed, from time to time, with the SEC.

CRITICAL ACCOUNTING POLICIES

      The SEC issued statements regarding disclosure by companies within
their management's discussion and analysis of financial condition and
results of operations. In those statements, the SEC encouraged companies to
identify critical accounting policies. Critical accounting policies are
those that are most important to the portrayal of a company's financial
condition and results, and that require management's most difficult,
subjective or complex judgments, often as a result of the need to make
estimates about the effect of matters that are inherently uncertain.
Management has identified the following critical accounting policies used
in the preparation of the Company's financial statements and accompanying
notes.











                                     19


<PAGE>


REVENUE RECOGNITION AND DEFERRED CONTRACT REVENUE

      The services provided by the Company to its customers are of a
subscription nature and are continuous. The Company views its business as
services provided to customers over a period of time and the wear period is
the period over which those services are provided. Badge production,
wearing of badges, badge analysis, and report preparation are integral to
the benefit that the Company provides to its customers. These services are
provided to customers on an agreed-upon recurring basis (monthly, bi-
monthly or quarterly) that the customer chooses for the wear period.
Revenue is recognized on a straight-line basis, adjusted for changes in
pricing and volume, over the wear period as the service is continuous and
no other discernible pattern of recognition is evident. Revenues are
recognized over the periods in which the customers wear the badges
irrespective of whether invoiced in advance or in arrears. The amounts
recorded as deferred contract revenue in the consolidated balance sheet
represent customer deposits invoiced in advance during the preceding twelve
months for services rendered over the succeeding twelve months, and are net
of services rendered through the respective consolidated balance sheet
date. Such advance billings amounted to $12,702,000 and $12,554,000,
respectively, as of September 30, 2005 and September 30, 2004. Management
believes that the amount of deferred revenue shown at the respective
consolidated balance sheet dates fairly represents the level of business
activity it expects to conduct with customers invoiced under this
arrangement.

PROPERTY, PLANT & EQUIPMENT

      Plant and equipment (including dosimetry badges and software) are
recorded at cost and are depreciated or amortized on a straight-line basis
over the estimated useful lives, which are primarily 30 years for buildings
and three to eight years for equipment. Landauer assesses the carrying
value of its property, plant and equipment and the remaining useful lives
whenever events or circumstances indicate the carrying value may not be
recoverable or the estimated useful life may no longer be appropriate.
Factors that could trigger this review include competitive conditions,
government regulations and technological changes. Maintenance and repairs
are charged to expense, and renewals and betterments are capitalized.
Landauer capitalizes, as a component of equipment, internal software costs
in accordance with SOP 98-1, "Accounting for the Costs of Computer Software
Developed or Obtained for Internal Use", and such costs amounted to
$1,449,000, $1,960,000 and $1,568,000, respectively, for fiscal years 2005,
2004 and 2003.

GOODWILL AND OTHER INTANGIBLE ASSETS

      The Company's intangible assets are comprised of goodwill, purchased
customer lists, licenses and patents. On October 1, 2001, the Company
adopted SFAS No. 142 which requires that goodwill and certain intangible
assets no longer be amortized to earnings, but be reviewed periodically for
impairment. For acquisitions completed prior to June 30, 2001, the
amortization of goodwill and certain intangible assets ceased beginning in
fiscal year 2002. Under SFAS 142, the impairment review of goodwill and
other intangible assets that are not being amortized must be based
generally on fair values. As a result of applying the impairment provisions
of SFAS No. 142, no impairment loss was required. Purchased customer lists
are recorded at cost and are amortized on a straight-line basis over
estimated useful lives, which range from 10 to 15 years. Patents and
licenses are also recorded at cost and are amortized on a straight-line
basis over their useful lives, which range from 10 to 17 years. Other
assets are reviewed for impairment whenever circumstances indicate that
impairment may exist. Such review is based on estimates of future
undiscounted cash flows and an assessment of fair value based on discounted
cash flows or other indicators of fair market value.






                                     20


<PAGE>


EMPLOYEE BENEFIT PLANS

      In the United States, Landauer maintains a qualified noncontributory
defined benefit pension plan covering substantially all full-time employees
and a supplemental key executive retirement plan that provides for certain
retirement benefits payable to key officers and managers. While charges for
the supplemental plan are expensed annually, the plan is not separately
funded. The Company maintains a directors' retirement plan that provides
for certain retirement benefits payable to non-employee directors. The
directors' plan was terminated in 1997. Additionally, the Company maintains
an unfunded retiree medical expense reimbursement plan.

      The pension expenses and benefit obligations recorded for these plans
are dependent on actuarial assumptions. These assumptions include discount
rates, expected return on plan assets, interest costs, expected
compensation increases, benefits earned, mortality rates, and other
factors. If actual results are significantly different than those
forecasted or if future changes are made to these assumptions, the amounts
recognized for these plans could change significantly. The weighted-average
actuarial assumptions used to determine the fiscal 2005 pension expense
included the following: discount rate of 6.25%, unchanged from prior year;
expected return on plan assets of 8.00%, unchanged from prior year; and
rate of compensation increase of 5.17%, slightly lower than fiscal 2004.
The weighted-average assumptions used to determine benefit obligations at
September 30, 2005 were a discount rate of 5.75%, lower than the fiscal
2004 rate of 6.25%, and a rate of compensation increase of 5.17%, slightly
lower than the rate for fiscal 2004.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

      The Company is exposed to market risk, including changes in foreign
currency exchange rates and interest rates. The financial statements of the
Company's non-U.S. subsidiaries are remeasured into U.S. dollars using the
U.S. dollar as the functional currency. To date, the market risk associated
with foreign currency exchange rates has not been material in relation to
the Company's financial position, results of operations, or cash flows.
These risks could increase, however, as the Company expands in
international markets. The Company does not have any significant trade
accounts receivable, trade accounts payable, or commitments in a currency
other than that of the reporting unit's functional currency. A 10% adverse
change in the underlying foreign currency exchange rates would not have a
material impact to our financial condition and reported results of
operations would decline by approximately $300,000. As such, the Company
does not currently use derivative financial instruments to manage the
exposure in its non-U.S. operations or for trading or speculative purposes.

      The Company seeks to manage its exposure to adverse interest rate
changes through its normal operations and does not use any derivative
financial instruments to manage such exposure. The Company uses a line of
credit to provide for a portion of its financing needs. At September 30,
2005, the balance outstanding under this arrangement was $4,048,000.
Interest costs would increase by approximately $40,500 for each percentage
point increase in the rate of interest on this credit facility assuming
current balances.
















                                     21


<PAGE>


ITEM 8. CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA


                         CONSOLIDATED BALANCE SHEETS
                       LANDAUER, INC. AND SUBSIDIARIES


                                                         (DOLLARS IN
                                                          THOUSANDS)
                                                      ------------------
AS OF SEPTEMBER 30,                          NOTES     2005       2004
-------------------                         -------  --------   --------

ASSETS

Current assets:
  Cash and cash equivalents. . . . . . . . .      1  $  9,598   $  8,595
  Receivables, net of allowances
    of $408 in 2005 and $460
    in 2004. . . . . . . . . . . . . . . . .           17,987     15,060
  Inventories. . . . . . . . . . . . . . . .      1     2,634      3,206
  Prepaid expenses and other
    current assets . . . . . . . . . . . . .     10     2,703      1,116
  Prepaid income taxes . . . . . . . . . . .  1 & 5     1,153      2,292
  Deferred income taxes. . . . . . . . . . .      5     1,514         21
                                                     --------   --------
Current assets . . . . . . . . . . . . . . .           35,589     30,290
                                                     --------   --------

Property, plant and equipment, at cost:           1
  Land and improvements. . . . . . . . . . .              634        634
  Buildings and improvements . . . . . . . .            4,073      4,104
  Equipment. . . . . . . . . . . . . . . . .           38,694     36,283
                                                     --------   --------
                                                       43,401     41,021
  Less: accumulated depreciation
    and amortization . . . . . . . . . . . .           25,494     22,481
                                                     --------   --------

Net property, plant and equipment. . . . . .           17,907     18,540
                                                     --------   --------

Equity in joint venture. . . . . . . . . . .      3     4,467      3,916
Goodwill and other intangible assets,
  net of amortization. . . . . . . . . . . .      4    20,187     19,493
Dosimetry devices, net of amortization
  of $5,911 in 2005 and $4,447 in 2004 . . .      1     6,537      4,791
Other assets . . . . . . . . . . . . . . . .      3     1,172        488
                                                     --------   --------

ASSETS . . . . . . . . . . . . . . . . . . .         $ 85,859   $ 77,518
                                                     ========   ========
















 The accompanying notes are an integral part of these financial statements.

                                     22


<PAGE>


                         CONSOLIDATED BALANCE SHEETS
                                 (CONTINUED)
                       LANDAUER, INC. AND SUBSIDIARIES


                                                         (DOLLARS IN
                                                          THOUSANDS)
                                                      ------------------
AS OF SEPTEMBER 30,                          NOTES     2005       2004
-------------------                         -------  --------   --------

LIABILITIES AND STOCKHOLDERS' INVESTMENT

Current liabilities:
  Accounts payable . . . . . . . . . . . . .         $  1,595   $  1,306
  Notes payable. . . . . . . . . . . . . . .      6     4,048      5,262
  Dividends payable. . . . . . . . . . . . .            3,815      3,577
  Deferred contract revenue. . . . . . . . .      1    12,702     12,554
  Accrued compensation and
    related costs. . . . . . . . . . . . . .            2,329      2,230
  Accrued pension costs. . . . . . . . . . .      8       864        834
  Accrued taxes on income. . . . . . . . . .  1 & 5       444         20
  Deferred income taxes. . . . . . . . . . .      5       --          94
  Other accrued expenses . . . . . . . . . .            4,036      2,399
                                                     --------   --------
Current liabilities. . . . . . . . . . . . .           29,833     28,276
                                                     --------   --------

Non-current liabilities:
  Pension and postretirement
    obligations. . . . . . . . . . . . . . .      8     7,062      3,845
  Deferred income taxes. . . . . . . . . . .      5       238      1,317
                                                     --------   --------
Non-current liabilities. . . . . . . . . . .            7,300      5,162
                                                     --------   --------

Minority interest in subsidiary. . . . . . .               128        83

Commitments and contingencies. . . . . . . .      9        --         --

STOCKHOLDERS' INVESTMENT . . . . . . . . . . 7 & 10
Preferred stock, $.10 par value
  per share, authorized 1,000,000
  shares; none issued. . . . . . . . . . . .               --         --
Common stock, $.10 par value per share,
  authorized 20,000,000 shares;
  9,029,793 and 8,945,665 issued and
  outstanding, respectively, in
  2005 and 2004. . . . . . . . . . . . . . .              903        895
Premium paid in on common stock. . . . . . .           17,147     14,400
Accumulated other comprehensive loss . . . .             (375)      (251)
Retained earnings. . . . . . . . . . . . . .           30,923     28,953
                                                     --------   --------
Stockholders' investment . . . . . . . . . .           48,598     43,997
                                                     --------   --------

LIABILITIES AND STOCKHOLDERS' INVESTMENT . .         $ 85,859   $ 77,518
                                                     ========   ========










 The accompanying notes are an integral part of these financial statements.

                                     23


<PAGE>


                      CONSOLIDATED STATEMENTS OF INCOME
                        LANDAUER, INC. & SUBSIDIARIES


                                               (DOLLARS IN THOUSANDS,
                                                 EXCEPT PER SHARE)
                                            ----------------------------
FOR THE YEARS
ENDED SEPTEMBER 30,                 NOTES    2005      2004       2003
-------------------                ------  --------  --------   --------

NET REVENUES . . . . . . . . . . .         $ 75,221  $ 69,809   $ 64,818
                                           --------  --------   --------

Costs and expenses
  Cost of sales. . . . . . . . . .           28,308    25,452     23,403
  Selling, general, and
    administrative . . . . . . . .      1    18,062    16,637     14,808
  Reorganization charge. . . . . .     11     2,300        --         --
  Impairment in value of assets. .     11        --        --      2,750
                                           --------  --------   --------
                                             48,670    42,089     40,961
                                           --------  --------   --------

Operating income . . . . . . . . .           26,551    27,720     23,857
Equity in income of joint
  venture. . . . . . . . . . . . .      3     1,352     1,083        867
Other income, net. . . . . . . . .               29        40        176
                                           --------  --------   --------
Income before taxes. . . . . . . .           27,932    28,843     24,900
Income taxes . . . . . . . . . . .  1 & 5   (10,623)  (10,786)    (9,193)
                                           --------  --------   --------

Income before minority interest. .           17,309    18,057     15,707
Minority interest. . . . . . . . .             (101)     (287)      (688)
                                           --------  --------   --------

Net income . . . . . . . . . . . .         $ 17,208  $ 17,770   $ 15,019
                                           ========  ========   ========

Net income per share:                   2
  Basic. . . . . . . . . . . . . .         $   1.92  $   2.00   $   1.71
                                           ========  ========   ========
  Diluted. . . . . . . . . . . . .         $   1.90  $   1.98   $   1.69
                                           ========  ========   ========























 The accompanying notes are an integral part of these financial statements.

                                     24


<PAGE>


<table>
                                CONSOLIDATED STATEMENTS OF STOCKHOLDERS' INVESTMENT
                                             AND COMPREHENSIVE INCOME
                                           LANDAUER, INC. & SUBSIDIARIES
<caption>
                                                                                         (Dollars in Thousands)
                                                  Premium
                                                  Paid        Accumulated                  Total
                                                  in on          Other                     Stock-     Compre-
                                       Common     Common      Comprehensive  Retained     holders'    hensive
                                       Stock      Stock       Income (Loss)  Earnings    Investment   Income
                                      --------    --------    -------------  --------    ----------   --------

                                   <c>         <c>         <c>            <c>         <c>          <c>
Balance September 30, 2002 . . . . .     $ 878    $ 10,946          $ (855)  $ 23,637      $34,606
Options exercised. . . . . . . . . .         6       1,261              --         --        1,267
Net income . . . . . . . . . . . . .        --          --              --     15,019       15,019    $ 15,019
Foreign currency translation
  adjustment . . . . . . . . . . . .        --          --             755         --          755         755
Dividends. . . . . . . . . . . . . .        --          --              --    (13,222)     (13,222)
                                         -----    --------          ------   --------     --------    --------
Comprehensive income . . . . . . . .                                                                  $ 15,774
                                                                                                      ========

Balance September 30, 2003 . . . . .     $ 884    $ 12,207          $ (100)  $ 25,434     $ 38,425
Options exercised. . . . . . . . . .        11       2,193              --         --        2,204
Net income . . . . . . . . . . . . .        --          --              --     17,770       17,770    $ 17,770
Foreign currency translation
  adjustment . . . . . . . . . . . .        --          --            (151)        --         (151)       (151)
Dividends. . . . . . . . . . . . . .        --          --              --    (14,251)     (14,251)
                                         -----    --------          ------   --------     --------    --------
Comprehensive Income . . . . . . . .                                                                  $ 17,619
                                                                                                      ========

Balance September 30, 2004 . . . . .     $ 895    $ 14,400          $ (251)  $ 28,953     $ 43,997
Options exercised. . . . . . . . . .         8       2,747              --         --        2,755
Net Income . . . . . . . . . . . . .        --          --              --     17,208       17,208    $ 17,208
Foreign currency translation
  adjustment . . . . . . . . . . . .        --          --             111         --          111         111
Increase in minimum pension
  liability. . . . . . . . . . . . .        --          --            (235)        --         (235)       (235)
Dividends. . . . . . . . . . . . . .        --          --              --    (15,238)     (15,238)
                                         -----    --------          ------   --------     --------    --------
Comprehensive Income . . . . . . . .                                                                  $ 17,084
                                                                                                      ========

Balance September 30, 2005 . . . . .     $ 903    $ 17,147          $ (375)  $ 30,923     $ 48,598
                                         =====    ========          ======   ========     ========

<fn>
                    The accompanying notes are an integral part of these financial statements.

                                                        25
</table>


<PAGE>


                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                        LANDAUER, INC. & SUBSIDIARIES


                                                (DOLLARS IN THOUSANDS)
FOR THE YEARS ENDED                         ----------------------------
SEPTEMBER 30,                                2005      2004       2003
-------------------                        --------  --------   --------

Cash flows from operating activities:
  Net income . . . . . . . . . . . . . . . $ 17,208  $ 17,770   $ 15,019

Adjustments to reconcile net income
 to net cash provided by operating
 activities:
  Depreciation . . . . . . . . . . . . . .    6,626     5,197      4,673
  Amortization . . . . . . . . . . . . . .      642       497        384
  Equity in net income of joint venture. .   (1,352)   (1,083)      (867)
  Tax effect of stock options. . . . . . .      887     1,451        920
  Loss on sale and disposition of
    assets . . . . . . . . . . . . . . . .       78        87      2,750
  Increase in accounts receivable, net . .   (2,979)   (1,290)      (149)
  Increase in other current assets . . . .     (993)     (862)    (1,392)
  Increase in dosimetry devices at cost. .   (3,758)   (2,492)    (1,811)
  (Increase) decrease in other
    long-term assets . . . . . . . . . . .     (222)     (294)       101
  Increase (decrease) in accounts
    payable and other current
    liabilities. . . . . . . . . . . . . .    2,461     1,075     (2,174)
  Increase in deferred contract revenue. .       87        89        580
  Increase in long-term liabilities. . . .    2,372     1,184        751
  Increase in minority interest. . . . . .      100       278        809
                                           --------  --------   --------
      Net cash provided by
        operating activities . . . . . . .   21,157    21,607     19,594
                                           --------  --------   --------

Cash flows used by investing activities:
  Acquisition of property, plant
    & equipment. . . . . . . . . . . . . .   (4,068)   (4,773)    (4,715)
  Acquisition of minority interests. . . .       --   (10,404)        --
                                           --------  --------   --------
      Net cash used by
        investing activities . . . . . . .   (4,068)  (15,177)    (4,715)
                                           --------  --------   --------

Cash flows used by financing activities:
  Proceeds from revolving credit
    facilities . . . . . . . . . . . . . .    1,500     8,025         --
  Payments on revolving credit
    facilities . . . . . . . . . . . . . .   (2,593)   (2,763)        --
  Dividends paid to minority interest. . .      (85)     (915)      (287)
  Dividends paid to stockholders . . . . .  (15,002)  (13,990)   (12,977)
  Proceeds from the exercise of
    stock options. . . . . . . . . . . . .      111       753        348
  Repayment to affiliate . . . . . . . . .       --      (404)      (185)
  Advance from affiliate . . . . . . . . .       --       598        535
                                           --------  --------   --------
      Net cash used by
        financing activities . . . . . . .  (16,069)   (8,696)   (12,566)
                                           --------  --------   --------
  Effects of foreign currency
    translation. . . . . . . . . . . . . .      (17)     (151)       755







                                     26


<PAGE>


                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (CONTINUED)
                        LANDAUER, INC. & SUBSIDIARIES


                                                (DOLLARS IN THOUSANDS)
FOR THE YEARS ENDED                         ----------------------------
SEPTEMBER 30,                                2005      2004       2003
-------------------                        --------  --------   --------

Net increase (decrease)
  in cash and cash equivalents . . . . . .    1,003    (2,417)     3,068
Opening balance -
  cash and cash equivalents. . . . . . . .    8,595    11,012      7,944
                                           --------  --------   --------
Ending balance -
  cash and cash equivalents. . . . . . . . $  9,598  $  8,595   $ 11,012
                                           ========  ========   ========

Supplemental disclosure of
 cash flow information:
  Cash paid for income taxes . . . . . . . $ 10,501  $ 10,156   $  9,086
                                           ========  ========   ========

Supplemental non-cash investing
 & financing information:
  Dividends declared but not paid. . . . . $  3,815  $  3,577   $  3,316
                                           ========  ========   ========








































 The accompanying notes are an integral part of these financial statements.

                                     27


<PAGE>


                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       LANDAUER, INC. AND SUBSIDIARIES


1.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF CONSOLIDATION

      The accompanying consolidated financial statements include the
accounts of Landauer, Inc.; LCIE-Landauer, Ltd. and HomeBuyer's Preferred,
Inc., its wholly-owned subsidiaries; SAPRA-Landauer, Ltda., its 75%-owned
subsidiary and Beijing-Landauer, Ltd., its 70%-owned subsidiary,
("Landauer" or the "Company"). Nagase-Landauer, Ltd. (50%-owned) is a
Japanese corporation that is accounted for on the equity basis. All
material intercompany transactions have been eliminated.

CASH EQUIVALENTS

      Cash equivalents include investments with an original maturity of
three months or less. Primarily all investments are short-term money market
instruments.

INVENTORIES

      Inventories, principally the components associated with dosimetry
devices, are valued at lower of cost or market utilizing a first-in, first-
out method.

REVENUES AND DEFERRED CONTRACT REVENUE

      The source of revenues for the Company is radiation measuring and
monitoring services including other services incidental to measuring and
monitoring. The measuring and monitoring services provided by the Company
to its customers are of a subscription nature and are continuous. The
Company views its business as services provided to customers over a period
of time and the wear period is the period over which those services are
provided. Badge production, wearing of badges, badge analysis, and report
preparation are integral to the benefit that the Company provides to its
customers. These services are provided to customers on an agreed-upon
recurring basis (monthly, bi-monthly or quarterly) that the customer
chooses for the wear period. Revenue is recognized on a straight-line
basis, adjusted for changes in pricing and volume, over the wear period as
the service is continuous and no other discernible pattern of recognition
is evident. Revenues are recognized over the periods in which the customers
wear the badges irrespective of whether invoiced in advance or in arrears.

      Many customers pay for these services in advance. The amounts
recorded as deferred contract revenue in the consolidated balance sheet
represent customer deposits invoiced in advance during the preceding twelve
months for services to be rendered over the succeeding twelve months, and
are net of services rendered through the respective consolidated balance
sheet date. Management believes that the amount of deferred contract
revenue shown at the respective consolidated balance sheet date fairly
represents the level of business activity it expects to conduct with
customers invoiced under this arrangement.

      Other services incidental to measuring and monitoring augment the
basic radiation measurement services that the Company offers, providing
administrative and informational tools to customers for the management of
their radiation detection programs. Other service revenues are recognized
upon delivery of the reports to customers or as other such services are
provided.

      The Company sells radiation monitoring products to its customers,
principally InLight products, for their use in conducting radiation
measurements or managing radiation detection programs. Currently, revenues
from product sales are not material.

      Revenues are shown net of nominal sales allowance adjustments.

                                     28


<PAGE>


RESEARCH AND DEVELOPMENT

      The cost of research and development programs is charged to selling,
general and administrative expense as incurred and amounted to
approximately  $1,704,000 in 2005, $1,758,000 in 2004 and $1,819,000 in
2003. Research and development costs include salaries and allocated
employee benefits, third-party research contracts, depreciation and
supplies.

DEPRECIATION, AMORTIZATION AND MAINTENANCE

      Property, plant and equipment are recorded at cost. Plant and
equipment are depreciated on a straight-line basis over their estimated
useful lives, which are primarily 30 years for buildings and three to eight
years for equipment. Dosimetry devices (principally badges) and software
are amortized on a straight-line basis over their estimated lives, which
are three to five years. Maintenance and repairs are charged to expense,
and renewals and betterments are capitalized.

ADVERTISING

      The Company expenses the costs of advertising as incurred.
Advertising expense amounted to $408,000 in fiscal 2005, $396,000 in fiscal
2004 and $345,000 in fiscal 2003.

INCOME TAXES

      Landauer files income tax returns in the jurisdictions in which it
operates. For financial statement purposes, provisions for federal, state,
and foreign income taxes have been computed in accordance with the
provisions of SFAS No. 109, "Accounting for Income Taxes."

USE OF ESTIMATES

      The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions 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. Actual results could differ from those
estimates.

RECLASSIFICATIONS

      Certain reclassifications have been made in the financial statements
for comparative purposes. These reclassifications have no effect on the
results of operations or financial position.

STOCK-BASED COMPENSATION PLANS

      The Company maintains three stock-based compensation plans for key
employees and/or non-employee directors: (i) the Landauer, Inc. 1996 Equity
Plan, as amended and restated through November 8, 2001 (the "1996 Equity
Plan"); (ii) the Landauer, Inc. 1997 Non-Employee Director's Stock Option
Plan, as amended and restated through November 8, 2001 (the "1997
Director's Plan"); and (iii) the Landauer, Inc. 2005 Long-Term Incentive
Plan (the "2005 LTI Plan"). Through September 30, 2005, the Company
accounted for these plans under the recognition and measurement principles
of APB Opinion No. 25, "Accounting for Stock Issued to Employees", and
related interpretations. Accordingly, no compensation costs have been
recognized for stock options awarded under these plans.









                                     29


<PAGE>


      In December 2002, the Financial Accounting Standards Board ("FASB")
issued Statement of Financial Accounting Standards ("SFAS") No. 148,
"Accounting for Stock-Based Compensation - Transition and Disclosure - An
Amendment of SFAS No. 123."  SFAS No. 148 requires disclosure in both
annual and quarterly financial statements about the method of accounting
for stock-based compensation, and the effect of the method used on reported
results.  Had compensation costs for these plans been determined consistent
with SFAS No. 123, "Accounting for Stock-Based Compensation," the Company's
net income and earnings per share in each period would have been as
follows:

(AMOUNTS IN THOUSANDS,
EXCEPT PER SHARE)                            2005      2004       2003
---------------------                       -------   -------    -------

Net income, as reported. . . . . . . . . .  $17,208   $17,770    $15,019

Deduct: Total stock-based employee
  compensation expense determined
  under fair value based method
  for all awards, net of related
  tax effects. . . . . . . . . . . . . . .    1,849     1,282        243

Pro forma net income . . . . . . . . . . .  $15,359   $16,488    $14,776

Earnings per share:
  Basic - As Reported. . . . . . . . . . .  $  1.92   $  2.00    $  1.71
  Basic - Pro Forma. . . . . . . . . . . .  $  1.71   $  1.85    $  1.68

  Diluted - As Reported. . . . . . . . . .  $  1.90   $  1.98    $  1.69
  Diluted - Pro Forma. . . . . . . . . . .  $  1.70   $  1.84    $  1.66

      Because the SFAS No. 123 method of accounting has not been applied to
options granted prior to October 1, 1996, the resulting pro forma
compensation cost may not be representative of that to be expected in
future years.

      In fiscal 2005, the Company recognized $61,000 in compensation
expense related to the grant of 8,225 shares of restricted stock under the
Landauer, Inc. 2005 Long-Term Incentive Plan. Fiscal 2006 expense for stock
options and restricted stock grants issued prior to October 1, 2006 is not
expected to be material. For additional information regarding stock-based
compensation, refer to Note 10.

RECENT ACCOUNTING PRONOUNCEMENTS

      In October 2004, the American Jobs Creation Act (the "Act") was
signed into law. The Act includes a temporary incentive for U.S.
corporations to repatriate accumulated income earned abroad by providing an
85 percent dividends-received deduction for certain qualifying cash
dividends received from controlled foreign corporations. The Act also
includes a deduction related to U.S. manufacturing income of 3% of eligible
income in 2005 and 2006. These deductions are subject to certain
limitations and, as of September 30, 2005, uncertainty remains as to how
certain provisions of the Act will be interpreted. Therefore, the Company
is not in a position as of September 30, 2005 to determine whether, and to
what extent, it would repatriate unremitted foreign earnings or deduct
eligible manufacturing income. In addition, the Financial Accounting
Standards Board ("FASB") released FASB Staff Position No. FAS 109-1 (FSP
109-1), "Application of FASB Statement No. 109, 'Accounting for Income
Taxes', for the Tax Deduction Provided to U.S.-Based Manufacturers by the
American Jobs Creation Act of 2004." This FSP clarifies that the tax
deduction for domestic manufacturers under the American Jobs Creation Act
of 2004 should be accounted for as a special deduction in accordance with
FASB Statement No. 109, "Accounting for Income Taxes" (FAS 109). In
December 2004, the FASB released FSP 109-2, "Accounting and Disclosure
Guidance for the Foreign Earnings Repatriation Provision within the
American Jobs Creation Act of 2004", which provides enterprises more time
(beyond the financial-reporting period during which the Act took effect) to

                                     30


<PAGE>


evaluate the Act's impact on the enterprise's plan for reinvestment or
repatriation of certain foreign earnings for purposes of applying FASB
Statement No. 109, "Accounting for Income Taxes" (FAS 109). The Company
continues to evaluate the impact that the final standard and the Staff
Positions will have on the Company's results of operations and financial
statements.

      In November 2004, the FASB issued Statement of Financial Accounting
Standards ("SFAS") No. 151, "Inventory Cost." This Statement amends the
guidance in Accounting Research Bulletin No. 43, Chapter 4, "Inventory
Pricing", to clarify the accounting for abnormal amounts of idle facility
expense, freight, handling costs, and wasted material (scrap). SFAS No. 151
requires that those items be recognized as current-period charges. In
addition, this Statement requires that the allocation of fixed production
overheads to the costs of conversion be based on the normal capacity of the
production facilities. The provisions of SFAS No. 151 are effective for
inventory costs incurred in fiscal years beginning after June 15, 2005. As
such, the Company is required to adopt these provisions at the beginning of
fiscal year 2006. The Company does not believe that implementing SFAS No.
151 will have a material impact on its consolidated financial statements.

      In December 2004, the FASB issued SFAS 123R, "Share-Based Payment."
This revised standard addresses the accounting for share-based payment
transactions in which a company receives employee services in exchange for
either equity instruments of the company or liabilities that are based on
the fair value of the company's equity instruments or liabilities that may
be settled by the issuance of such equity instruments. Under the new
standard, companies will no longer be able to account for share-based
compensation transactions using the intrinsic method, in accordance with
APB 25. Instead, companies will be required to account for such
transactions using a fair-value method and recognize the expense in the
consolidated statement of income. In April 2005, the SEC approved a new
rule that delays the effective date of SFAS 123R for public companies to
annual, rather than interim, periods that begin after June 15, 2005.  In
addition, the SEC issued Staff Accounting Bulletin ("SAB") No. 107, "Share-
Based Payment" in March 2005, which provides supplemental SFAS 123R
guidance based on the views of the SEC. Further guidance to be used in the
implementation of SFAS 123R has been issued in FSP Nos. FAS 123(R)-1,
"Classification and Measurement of Freestanding Financial Instruments
Originally Issued in Exchange for Employee Services under FASB Statement
No. 123(R)", FAS 123(R)-2, "Practical Accommodation to the Application of
Grant Date as Defined in FASB Statement No. 123(R)", and FAS 123(R)-3,
"Transition Election Related to Accounting for the Tax Effects of Share-
Based Payment Awards". The Company has assessed the impact of SFAS 123R on
its consolidated financial statements and adopted SFAS 123R beginning
October 1, 2005, using the modified-prospective application method and the
Black-Scholes valuation for stock options issued prior to September 30,
2005.

2.    INCOME PER COMMON SHARE

      Basic earnings per share were computed by dividing net income by the
weighted average number of shares of common stock outstanding during each
year. Diluted earnings per share were computed by dividing net income by
the weighted average number of shares of common stock that would have been
outstanding assuming dilution during each year.














                                     31


<PAGE>


      Following is a table that shows the weighted average number of shares
of common stock for the years ended September 30:

(AMOUNTS IN THOUSANDS)                        2005      2004       2003
----------------------                       ------    ------     ------
Weighted average number of shares
  of common stock outstanding. . . . . . .    8,966     8,894      8,808

Effect of dilutive securities: options
  issued to employees. . . . . . . . . . .       72        77         83
                                             ------    ------     ------
Weighted average number of shares
  of common stock assuming dilution. . . .    9,038     8,971      8,891
                                             ======    ======     ======

      Following is a table that provides net income and earnings per share
for the years ended September 30:

(DOLLARS IN THOUSANDS,
EXCEPT PER SHARE)                            2005      2004       2003
----------------------                      -------   -------    -------
Net income . . . . . . . . . . . . . . . .  $17,208   $17,770    $15,019
  Basic EPS. . . . . . . . . . . . . . . .  $  1.92   $  2.00    $  1.71
  Diluted EPS. . . . . . . . . . . . . . .  $  1.90   $  1.98    $  1.69

3.    EQUITY IN JOINT VENTURE

      Landauer's 50% interest in the common stock of Nagase-Landauer, Ltd.,
a Japanese corporation located in Tokyo and engaged in providing radiation
monitoring services in Japan, is accounted for on the equity basis. The
related equity in earnings of this joint venture is included in its own
caption in the accompanying Statements of Income. At September 30, 2005,
Landauer, Inc. dividends receivable due from Nagase-Landauer, Ltd of
$581,000 are reported in other assets. In fiscal 2004 and 2003, Nagase-
Landauer, Ltd distributed dividends to Landauer, Inc. in the amount of
$598,000 and $535,000, respectively.

      Condensed unaudited results of operations for Nagase-Landauer, Ltd.
are as follows, converted into U.S. dollars at the then-current rate of
exchange, for the years ended September 30:

(DOLLARS IN THOUSANDS)                       2005      2004       2003
----------------------                      -------   -------    -------
Revenues . . . . . . . . . . . . . . . . .  $13,892   $13,687    $14,227
Income before income taxes . . . . . . . .    4,261     3,838      3,218
Net income . . . . . . . . . . . . . . . .    2,704     2,166      1,734
                                            -------   -------    -------
Average exchange rate (<yen>/$). . . . . .    107.3     108.8      118.9
                                            =======   =======    =======

      Condensed unaudited balance sheets for the years ended September 30,
2005 and 2004, converted into U.S. dollars at the then-current rate of
exchange, are as follows:

(DOLLARS IN THOUSANDS)                            2005        2004
----------------------                           -------     -------
Current assets . . . . . . . . . . . . . . . .   $14,754     $12,699
Other assets . . . . . . . . . . . . . . . . .     1,514       1,529
                                                 -------     -------
Total assets . . . . . . . . . . . . . . . . .   $16,268     $14,228
                                                 =======     =======

Liabilities. . . . . . . . . . . . . . . . . .   $ 7,334     $ 6,376
Stockholders' investment . . . . . . . . . . .     8,934       7,852
                                                 -------     -------
Total liabilities and
  stockholders' investment . . . . . . . . . .   $16,268     $14,228
                                                 =======     =======


                                     32


<PAGE>


4.    GOODWILL AND OTHER INTANGIBLE ASSETS

      The components of goodwill and other intangible assets for the years
ended September 30, 2005 and 2004 are as follows:

(DOLLARS IN THOUSANDS)                            2005        2004
----------------------                           -------     -------
Goodwill, net of pre-2002 amortization
  of $3,281 in 2005 and $3,264 in 2004
  (no longer amortized). . . . . . . . . . . .   $13,261     $13,156
Customer list, net of amortization of
  $1,474 in 2005 and $953 in 2004
  (useful life of 10-15 years) . . . . . . . .     5,181       5,702
Licenses and patents, net of amortization
  of $369 in 2005 and $306 in 2004
  (useful life of 10-17 years) . . . . . . . .       449         393
Deferred pension cost (not amortized). . . . .     1,109          --
Other intangibles, net of amortization
  of $390 in 2005 and $334 in 2004
  (useful life of 10 years). . . . . . . . . .       187         242
                                                 -------     -------
Total. . . . . . . . . . . . . . . . . . . . .   $20,187     $19,493
                                                 =======     =======

      The intangible asset amounts noted above are presented net of
accumulated amortization of $5,514,000 at September 30, 2005 and $4,857,000
at September 30, 2004. Amortization of intangible assets was $642,000,
$497,000, and $384,000 for the years ended September 30, 2005, 2004 and
2003, respectively. Estimated annual aggregate amortization expense related
to intangible assets will be approximately $646,000, $629,000, $632,000,
$580,000, and $580,000, respectively, for each of the next five years.

5.    INCOME TAXES

      The components of the provision for income taxes for the years ended
September 30, 2005, 2004 and 2003 are as follows:

                                                       2005

(DOLLARS IN THOUSANDS)                     Current   Deferred    Total
---------------------                      --------  --------   --------
Federal. . . . . . . . . . . . . . . . . . $ 10,916  $ (2,151)  $  8,765
State. . . . . . . . . . . . . . . . . . .    2,292      (434)     1,858
                                           --------  --------   --------
Total. . . . . . . . . . . . . . . . . . . $ 13,208  $ (2,585)  $ 10,623
                                           ========  ========   ========

                                                       2004

                                           Current   Deferred    Total
                                           --------  --------   --------
Federal. . . . . . . . . . . . . . . . . . $  8,757  $    220   $  8,977
State. . . . . . . . . . . . . . . . . . .    1,765        44      1,809
                                           --------  --------   --------
Total. . . . . . . . . . . . . . . . . . . $ 10,522  $    264   $ 10,786
                                           ========  ========   ========

                                                       2003

                                           Current   Deferred    Total
                                           --------  --------   --------
Federal. . . . . . . . . . . . . . . . . . $  9,120  $ (1,457)  $  7,663
State. . . . . . . . . . . . . . . . . . .    1,821      (291)     1,530
                                           --------  --------   --------
Total. . . . . . . . . . . . . . . . . . . $ 10,941  $ (1,748)  $  9,193
                                           ========  ========   ========




                                     33


<PAGE>


      The provision for taxes on income in each period differs from that
which would be computed by applying the statutory U.S. federal income tax
rate to the income before taxes. The following is a summary of the major
items affecting the provision:

(DOLLARS IN THOUSANDS)                       2005      2004       2003
----------------------                      -------   -------    -------
Statutory federal income tax rate. . . . .      35%       35%        35%

Computed tax provision at statutory rate .  $ 9,776   $10,095    $ 8,715
Increases (decreases) resulting from:
  State income tax provision net of
    federal benefit. . . . . . . . . . . .    1,208     1,176        959
  Other. . . . . . . . . . . . . . . . . .     (361)     (485)      (481)
                                            -------   -------    -------
Income tax provision in the statement
  of income. . . . . . . . . . . . . . . .  $10,623   $10,786    $ 9,193
                                            =======   =======    =======

      The Company has adopted SFAS No. 109, "Accounting For Income Taxes."
Accordingly, the Company recognizes certain income and expense items in
different years for financial and tax reporting purposes. These temporary
differences are primarily attributable to (a) utilization of accelerated
depreciation methods for tax purposes, (b) amortization of badge holder and
software development costs, (c) limitations on deductibility of pension
costs, (d) accrued benefit claims, vacation pay, and other compensation-
related costs, and (e) allowances for obsolete inventory.

      Significant components of deferred taxes are as follows:

(DOLLARS IN THOUSANDS)                            2005        2004
----------------------                           -------     -------
Deferred tax assets:
  Tangible asset amortization. . . . . . . . .   $ 1,977     $ 1,356
  Pension accrual. . . . . . . . . . . . . . .     1,695       1,267
  Compensation expense . . . . . . . . . . . .       666          37
  Inventory reserve. . . . . . . . . . . . . .        43         146
  Medical insurance claims . . . . . . . . . .       549         457
  Foreign tax credit carryforward. . . . . . .       414         --
  Other. . . . . . . . . . . . . . . . . . . .       847         699
                                                 -------     -------
                                                 $ 6,191     $ 3,962
                                                 =======     =======
Deferred tax liabilities:
  Depreciation . . . . . . . . . . . . . . . .   $ 1,285     $  (298)
  Software development . . . . . . . . . . . .     2,532       4,661
  Intangible asset amortization. . . . . . . .       945         989
  Other. . . . . . . . . . . . . . . . . . . .       153          --
                                                 -------     -------
                                                 $ 4,915     $ 5,352
                                                 =======     =======

6.    NOTES PAYABLE

      In April 2004, the Company negotiated a $25 million line of credit
provided by LaSalle Bank, N.A. and borrowed $7,724,000 (euro denominated)
under this facility as part of funding the acquisition of the remaining 49%
minority interest in LCIE-Landauer, Ltd. The credit facility provides funds
that are to be used for working capital and other general corporate
purposes. The credit agreement is annually renewable upon agreement of the
parties and provides the Company with the option of electing to borrow
funds denominated in U.S. dollars or Euros that bear interest rates based
on the federal funds rate, prime rate, EURIBOR or LIBOR. It also contains
certain covenants, including a covenant for minimum tangible net worth. The
credit agreement was amended, effective March 25, 2005, to extend the
maturity date to March 25, 2006 and reduce the aggregate loan commitment
under the credit facility to $15 million, with an option for the Company to
increase to $25 million. The remaining terms of the amended credit facility


                                     34


<PAGE>


are consistent with the original credit facility. As of September 30, 2005,
the Company was in compliance with all of the covenants contained in the
credit agreement.

      The outstanding balance under the line of credit of $4,048,000 at
September 30, 2005 is denominated in euros and bears interest at 3.37%
until January 25, 2006, at which time the Company may execute a new EURIBOR
election notice for an additional interest period and rate for the
remaining balance of the advance, as permitted under the terms of the
credit agreement. In the event the credit facility is not renewed at
maturity, it is expected that cash on hand, cash flow from operations, and
the Company's borrowing capacity will be sufficient to satisfy the
obligation. The Company funds euro-based debt service payments from euro-
denominated cash flows. The Company intends to renew the credit facility
prior to expiration.

7.    CAPITAL STOCK

      Landauer has two classes of capital stock, preferred and common, with
a par value of $0.10 per share for each class. As of September 30, 2005 and
2004, there were 9,029,793 and 8,945,665 shares of common stock issued and
outstanding (20,000,000 shares are authorized), respectively. There are no
shares of preferred stock issued (1,000,000 shares are authorized). Cash
dividends of $1.70 per common share were paid in fiscal 2005. At Septem-
ber 30, 2005, there were accrued and unpaid dividends of $3,815,000.

      Landauer has reserved 500,000 shares of common stock under its long-
term incentive plan approved on February 3, 2005. Previously, Landauer had
reserved 1,450,000 shares of common stock for grants under its equity
compensation plans. Upon approval of the new plan in 2005, all shares
reserved under prior plans were cancelled. Recipients of grants or options
must execute a standard form of a non-compete agreement. As of Septem-
ber 30, 2005, there have been no bonus shares issued under the plans.

8. EMPLOYEE BENEFIT PLANS

      In the United States, Landauer maintains a qualified noncontributory
defined benefit pension plan covering substantially all full-time
employees. The Company also maintains a supplemental key executive
retirement plan that provides for certain retirement benefits payable to
key officers and managers. While charges for the supplemental plan are
expensed annually, the plan is not separately funded. The Company maintains
a directors' retirement plan that provides for certain retirement benefits
payable to non-employee directors. The directors' plan was terminated in
1997. Pensions for international employees are generally provided under
government sponsored programs funded by employment taxes.

      Plan assets for the qualified defined benefit pension plan include
marketable equity securities, corporate and government debt securities, and
cash and short-term investments. The plan assets are not directly invested
in the Company's common stock. The supplemental key executive retirement
plan and the directors' retirement plan are not separately funded.

      Landauer maintains a 401(k) savings plan covering substantially all
U.S. full-time employees. Qualified contributions made by employees to the
plan are partially matched by the Company. For the fiscal years ended
September 30, 2005, 2004 and 2003, $143,000, $141,000, and $124,000,
respectively, were provided to expense under the plan.

      Landauer has adopted SFAS No. 106, "Accounting for Postretirement
Benefits Other than Pensions" to account for the Company's unfunded retiree
medical expense reimbursement plan. Under the terms of the plan, which
covers retirees with ten or more years of service, the Company will
reimburse retirees to age 70 for (i) a portion of the cost of coverage
under the then-current medical and dental insurance plans if the retiree is





                                     35


<PAGE>


under age 65, or (ii) all or a portion of the cost of Medicare and
supplemental coverage if the retiree is over age 64. The assumption for
health-care cost trend rates were 6% for those younger than 65, and 5% for
those 65 and older. The effect of a one percent increase on service and
interest costs and postretirement benefit obligation would be $21,000 and
$168,000, respectively. For a one percent decrease, the effect would be a
reduction to service and interest costs and postretirement benefit
obligation of $18,000 and $150,000, respectively. The amount of the
Company's unrecognized transition obligation resulting from the adoption of
SFAS No. 106 was $159,000 as of September 30, 2005. The liability is
included in "pension and postretirement obligations."

      The Company uses a September 30 measurement date for its plans.

      The following tables set forth the status of these combined plans at
September 30, 2005 and 2004 in accordance with SFAS Nos. 87 and 132.

                                          PENSION             OTHER
                                          BENEFITS           BENEFITS
                                     ----------------   ----------------
(DOLLARS IN THOUSANDS)                 2005     2004      2005     2004
----------------------               -------  -------   -------  -------
Change in benefit obligation:
Benefit obligation at
  beginning of year. . . . . . . . . $17,737  $16,390   $ 1,494  $ 1,148
Service cost . . . . . . . . . . . .   1,031    1,001       102       98
Interest cost. . . . . . . . . . . .   1,072      986       108       82
Special termination benefits (1) . .     701       --        --       --
Actuarial (gain) loss. . . . . . . .   1,106     (347)      339      182
Benefits paid. . . . . . . . . . . .    (298)    (293)      (36)     (16)
                                     -------  -------   -------  -------
Benefit obligation at
  end of year. . . . . . . . . . . . $21,349  $17,737   $ 2,007  $ 1,494
                                     =======  =======   =======  =======
----------

  (1) Represents benefit costs arising from the early retirement of the
      Company's former chief executive officer and additional personnel
      changes. Refer to Note 11 for additional information.


                                          PENSION             OTHER
                                          BENEFITS           BENEFITS
                                    -----------------   ----------------
(DOLLARS IN THOUSANDS)                2005      2004      2005     2004
----------------------              --------  -------   -------  -------
Change in plan assets:
Fair value of assets at
  beginning of year. . . . . . . .  $  8,942  $ 8,025   $    --  $    --
Actual return on plan assets . . .       547      373        --       --
Employer contribution. . . . . . .       843      837        36       16
Benefits paid. . . . . . . . . . .      (298)    (293)      (36)     (16)
                                    --------  -------   -------  -------
Fair value of assets at
  end of year. . . . . . . . . . .  $ 10,034  $ 8,942   $    --  $    --
                                    ========  =======   =======  =======

Reconciliation of funded status:
Funded status. . . . . . . . . . .  $(11,315) $(8,795)  $(2,007) $(1,494)
Unrecognized transition
  obligation (asset) . . . . . . .       (12)     (19)      159      182
Unrecognized prior service cost. .     1,232    1,387        17       34
Unrecognized net actuarial loss. .     5,027    3,848       480      187
                                    --------  -------   -------  -------
Net amount recognized. . . . . . .  $ (5,068) $(3,579)  $(1,351) $(1,091)
                                    ========  =======   =======  =======




                                     36


<PAGE>


      The accumulated benefit obligation for all defined benefit pension
plans was $16,413,000 and $11,961,000 at September 30, 2005 and 2004,
respectively.

      Information for pension plans with an accumulated benefit obligation
in excess of plan assets:

                                                    SEPTEMBER 30,
(DOLLARS IN THOUSANDS)                            2005        2004
----------------------                           -------     -------
Projected benefit obligation . . . . . . . . .   $21,349     $ 4,040
Accumulated benefit obligation . . . . . . . .    16,413       3,514
Fair value of plan assets. . . . . . . . . . .    10,034          --

      In 2005, the accumulated benefit obligation exceeded plan assets for
all pension plans. In 2004, the accumulated benefit obligation exceeded
plan assets for the supplemental key executive retirement plan and the
directors' retirement plan. At September 30, 2005, the Company recorded an
additional minimum pension liability of $1,499,000 along with a related
deferred pension cost reported in intangible assets of $1,109,000 and
minimum pension liability charge in accumulated other comprehensive income
of $235,000, net of tax.

COMPONENTS OF NET PERIODIC BENEFIT COST:

                                          PENSION             OTHER
                                          BENEFITS           BENEFITS
                                    -----------------   ----------------
(DOLLARS IN THOUSANDS)                2005      2004      2005     2004
----------------------              --------  -------   -------  -------
Service cost . . . . . . . . . . .  $  1,031  $ 1,001   $   102  $    98
Interest cost. . . . . . . . . . .     1,072      986       108       82
Expected return on plan assets . .      (724)    (650)       --       --
Amortization of transition
  obligation (asset) . . . . . . .        (6)      (6)       23       23
Amortization of prior
  service cost . . . . . . . . . .       156      156        17       17
Recognized net actuarial loss. . .       104      120        46       11
Special termination benefits . . .       701       --        --       --
                                    --------  -------   -------  -------
Net periodic benefit cost. . . . .  $  2,334  $ 1,607   $   296  $   231
                                    ========  =======   ======= ========

ASSUMPTIONS

      The weighted-average assumptions used to determine benefit
obligations at September 30 were as follows:

                                          PENSION             OTHER
                                          BENEFITS           BENEFITS
                                     ----------------   ----------------
                                       2005     2004      2005     2004
                                     -------  -------   -------  -------
Discount rate. . . . . . . . . . .     5.75%    6.25%     5.75%    6.25%
Rate of compensation increase. . .     5.17%    5.19%     6.00%    6.00%

      The weighted-average assumptions used to determine net periodic
benefit cost for years ended September 30 were as follows:

                                          PENSION             OTHER
                                          BENEFITS           BENEFITS
                                     ----------------   ----------------
                                       2005     2004      2005     2004
                                     -------  -------   -------  -------
Discount rate. . . . . . . . . . .     6.25%    6.25%     6.25%    6.25%
Expected long-term return
  on plan assets . . . . . . . . .     8.00%    8.00%     0.00%    0.00%
Rate of compensation increase. . .     5.17%    5.19%     6.00%    6.00%


                                     37


<PAGE>


      The expected long-term rate of return of plan assets is based on
historical and projected rates of return for current and planned asset
classes in the plan's investment portfolio. Based on the target asset
allocation for each asset class, the overall expected rate of return for
the portfolio was developed and adjusted for historical and expected
experience of the active portfolio management results compared to the
benchmark returns and for the effect of expenses paid from plan assets. The
Company reviews this long-term assumption on an annual basis.

      Assumed health care cost trend rates at September 30 were:

                                                  2005        2004
                                                 -------     -------
Health care cost trend rate assumed
  for next year. . . . . . . . . . . . . . . .       12%         12%
Rate to which the cost trend rate is
  assumed to decline (the ultimate
  trend rate). . . . . . . . . . . . . . . . .        6%          6%
Year that the rate reaches the
  ultimate trend rate. . . . . . . . . . . . .      2011        2010

      Assumed health care cost trend rates have a significant effect on the
amounts reported for the health care plans. A one-percentage-point change
in assumed health care cost trend rates would have the following effects:

                                         1-PERCENTAGE-  1-PERCENTAGE-
                                             POINT          POINT
(DOLLARS IN THOUSANDS)                     INCREASE       DECREASE
----------------------                   -------------  -------------
Effect on total of service and
  interest cost. . . . . . . . . . . . .        $  21          $ (18)
Effect on postretirement
  benefit obligation . . . . . . . . . .          168           (150)


PLAN ASSETS

      Landauer's pension plan weighted-average asset allocations at
September 30, 2005, and 2004, by asset category were as follows:

                                                   PLAN ASSETS AT
                                                    SEPTEMBER 30
ASSET CATEGORY                                    2005        2004
--------------                                   -------     -------
Fixed income . . . . . . . . . . . . . . . . .       53%         55%
Equity securities. . . . . . . . . . . . . . .       46%         44%
Cash equivalents . . . . . . . . . . . . . . .        1%          1%
                                                    ----        ----
Total. . . . . . . . . . . . . . . . . . . . .      100%        100%
                                                    ====        ====


      The plan's investment strategy supports the objectives of the plan.
These objectives are to maximize returns in order to minimize contributions
within reasonable and prudent levels of risk. To achieve these objectives,
the Company has established a strategic asset allocation policy which is to
maintain approximately one half of plan assets in high quality fixed income
securities such as investment grade bonds and short term government
securities, with the other half containing large capitalization equity
securities. The plan's objective is to periodically rebalance its assets to
approximate weighted-average target asset allocations. Investments are
diversified across classes and within each class to minimize the risk of
large losses.







                                     38


<PAGE>


CONTRIBUTIONS

      The Company expects to contribute $835,000 to its defined benefit
pension plan in fiscal 2006, the maximum amount permitted under U.S. tax
law.

ESTIMATED FUTURE BENEFIT PAYMENTS

      The following benefit payments, which reflect expected future
service, as appropriate, are expected to be paid:

                                                PENSION      OTHER
(DOLLARS IN THOUSANDS)                          BENEFITS    BENEFITS
----------------------                          --------    --------
  2006 . . . . . . . . . . . . . . . . . . . .    $  320      $   35
  2007 . . . . . . . . . . . . . . . . . . . .       335          43
  2008 . . . . . . . . . . . . . . . . . . . .       640          66
  2009 . . . . . . . . . . . . . . . . . . . .       779          88
  2010 . . . . . . . . . . . . . . . . . . . .       775         120
  Years 2011-2015. . . . . . . . . . . . . . .     5,893         828


9.    COMMITMENTS AND CONTINGENCIES

      The Company is a party, from time to time, to various legal
proceedings, lawsuits and other claims arising in the ordinary course of
its business. The Company does not believe that any such litigation pending
as of September 30, 2005, if adversely determined, would have a material
effect on its business, financial position, results of operations, or cash
flows.

10.   STOCK-BASED COMPENSATION PLANS

      The Company maintains three stock-based compensation plans for key
employees and/or non-employee directors: (i) the Landauer, Inc. 1996 Equity
Plan, as amended and restated through November 8, 2001 (the "1996 Equity
Plan"); (ii) the Landauer, Inc. 1997 Non-Employee Director's Stock Option
Plan, as amended and restated through November 8, 2001 (the "1997
Director's Plan"); and (iii) the Landauer, Inc. 2005 Long-Term Incentive
Plan (the "2005 LTI Plan"). Through September 30, 2005, the Company
accounted for these plans under the recognition and measurement principles
of APB Opinion No. 25, "Accounting for Stock Issued to Employees", and
related interpretations. Accordingly, no compensation costs have been
recognized for stock options awarded under these plans.

      Under the 1996 Equity Plan the Company may grant stock options, as
well as other equity awards, for up to 1,350,000 shares. This plan also
provided for the grant of restricted shares or the grant of stock
appreciation rights, either separately or in relation to options granted.
As of September 30, 2005, no stock appreciation rights had been granted.
Under the 1997 Director's Plan the Company may grant stock options for up
to 100,000 shares. Through September 30, 2005, the Company has granted
options on 1,228,684 and 45,840 shares, respectively, under these two
plans. Under each plan, the option exercise price equals the stock's fair
market value on the date of the grant. Options granted under the 1996
Equity Plan vest over varying periods of time and may include sale
restrictions. Options granted during fiscal 2005 under the 1996 Equity Plan
vested immediately and sale of shares realized through exercise of such
options was prohibited for three years. The initial grant of options in
1997 under the 1997 Director' Plan vests ratably over ten years and
subsequent grants vest ratably over three years.









                                     39


<PAGE>


      During fiscal 2005, options for 185,000 shares were granted under the
1996 Equity Plan and the 1997 Director's Plan and 136,638 options were
exercised. As of September 30, 2005, non-qualified options for 477,875
shares had been granted under these two plans at prices from $19.36 -
$46.80 per share. At year-end, 425,250 shares were exercisable. The term of
all options granted under these two plans is for a period of ten years. All
options granted under these two plans have been non-qualified options.
Grants of any awards under the 1996 Equity Plan and the 1997 Director's
Plan were terminated on February 3, 2005, and any shares reserved for award
and unused were cancelled.

      In February 2005, the Company adopted the 2005 LTI Plan, following
shareholder approval, and reserved 500,000 shares of its common stock for
grant under the plan. Eligible participants include key employees and
officers of the Company and non-employee directors. This plan provides for
the grant of stock options (incentive or non-qualified), stock shares
(restricted, restricted stock units and performance shares or performance
share units), performance units, and stock appreciation rights, either
separately or in relation to options granted. The plan expires on
February 2, 2015. For future grants, the 2005 LTI Plan replaces the 1996
Equity Plan and the 1997 Director's Plan.

      During fiscal 2005, the Company granted non-qualified options for
56,000 shares, at prices from $45.94 - $49.88 per share, under the 2005 LTI
Plan and awarded 8,225 restricted shares. Options granted during fiscal
2005 under this plan vested immediately and sales of shares realized
through exercise of such options were prohibited for three years. At year-
end, options for 56,000 shares were exercisable. The term of all options
granted under this plan is for a period of ten years.  The restricted
shares vest over a period of three years. During fiscal 2005, the Company
recognized $61,000 in compensation expense related to the 8,225 shares of
restricted stock granted. The weighted average fair value of the restricted
shares was $47.48.

      Pursuant to the terms of his employment agreement with the Company,
the President and Chief Executive Officer will participate in a performance
share award in the amount of 10,500 shares beginning with the 2006 fiscal
year.  Vesting of the award is subject to financial performance criteria
for fiscal 2006, 2007 and 2008 measured in terms of actual net income
compared with planned net income over the combined three-year period.

      The summary of the status of these plans at September 30, 2005, 2004,
and 2003 and changes for the years then ended is presented in the following
tables and narrative:

                                                            2005
                                                      -----------------
                                                               WEIGHTED
(AMOUNTS IN THOUSANDS,                                         AVERAGE
EXCEPT PER SHARE)                                     SHARES    PRICE
----------------------                                ------   --------
Outstanding at beginning of year . . . . . . . . .       440    $ 34.73
Granted. . . . . . . . . . . . . . . . . . . . . .       241      47.24
Exercised. . . . . . . . . . . . . . . . . . . . .      (137)     32.68
Forfeited. . . . . . . . . . . . . . . . . . . . .       (10)     35.79
                                                        ----    -------
Outstanding at end of year . . . . . . . . . . . .       534    $ 40.88
                                                        ----    -------
Exercisable at end of year . . . . . . . . . . . .       481    $ 41.57
                                                        ====    =======
Weighted average fair value of options granted . .              $ 10.76
                                                                =======








                                     40


<PAGE>


                                                            2004
                                                      -----------------
                                                               WEIGHTED
(AMOUNTS IN THOUSANDS,                                         AVERAGE
EXCEPT PER SHARE)                                     SHARES    PRICE
----------------------                                ------   --------
Outstanding at beginning of year . . . . . . . . .       445    $ 28.05
Granted. . . . . . . . . . . . . . . . . . . . . .       210      39.78
Exercised. . . . . . . . . . . . . . . . . . . . .      (186)     24.37
Forfeited. . . . . . . . . . . . . . . . . . . . .       (29)     35.08
                                                        ----    -------
Outstanding at end of year . . . . . . . . . . . .       440    $ 34.73
                                                        ----    -------
Exercisable at end of year . . . . . . . . . . . .       281    $ 36.26
                                                        ====    =======
Weighted average fair value of options granted . .              $  8.17
                                                                =======

                                                            2003
                                                      -----------------
                                                               WEIGHTED
(AMOUNTS IN THOUSANDS,                                         AVERAGE
EXCEPT PER SHARE)                                     SHARES    PRICE
----------------------                                ------   --------
Outstanding at beginning of year . . . . . . . . .       436    $ 23.63
Granted. . . . . . . . . . . . . . . . . . . . . .       142      34.54
Exercised. . . . . . . . . . . . . . . . . . . . .      (123)     20.16
Forfeited. . . . . . . . . . . . . . . . . . . . .       (10)     25.18
                                                        ----    -------
Outstanding at end of year . . . . . . . . . . . .       445    $ 28.05
                                                        ----    -------
Exercisable at end of year . . . . . . . . . . . .       193    $ 25.12
                                                        ====    =======
Weighted average fair value of options granted . .              $  6.24
                                                                =======


      Following is a table that summarizes information about options
outstanding as of September 30, 2005:

                                                             Options
                         Options Outstanding                Exercisable
                    --------------------------------    ------------------
                                Average     Weighted              Weighted
Range of                       Remaining    Average               Average
Exercise                      Contractual   Exercise              Exercise
Prices               Shares      Life        Price       Shares    Price
--------            --------  -----------   --------    --------  --------

$ 19.36-$ 25.00       26,750            4    $ 21.18      22,750   $ 20.98
$ 25.01-$ 31.00       20,000            3      26.44      20,000     26.44
$ 31.01-$ 37.00       79,375            7      34.25      37,875     34.32
$ 37.01-$ 43.00      165,750            8      39.67     160,125     39.59
$ 43.01-$ 49.00      237,000            9      47.17     235,500     47.19
$ 49.01+               5,000           10      49.88       5,000     49.88
                     -------          ---    -------     -------   -------
                     533,875            7    $ 40.87     481,250   $ 41.57
                     =======          ===    =======     =======   =======

      The fair value of each option grant is estimated on the date of grant
using the Black-Scholes option pricing model with the following weighted
average assumptions used for grants in fiscal 2005, 2004, and 2003:

                                             2005      2004       2003
                                            -------   -------    -------
Risk free interest rate. . . . . . . . . .    4.27%     4.27%      4.13%
Expected dividend yield. . . . . . . . . .    3.44%     4.02%      4.35%
Expected life (years). . . . . . . . . . .       10        10         10
Expected volatility. . . . . . . . . . . .   23.73%    24.22%     23.13%

                                     41


<PAGE>


      Fiscal 2006 expense for stock options and restricted stock grants
issued prior to October 1, 2006 is not expected to be material.

      Prepaid expenses and other current assets as of September 30, 2005
include $1.8 million related to amounts owed to the Company by the former
Chief Executive Officer related to the exercise of vested options. Such
amount was collected in October 2005.

11.   REORGANIZATION AND IMPAIRMENT CHARGES

      In September 2005, Landauer recognized expense in the amount of
$2,300,000 associated with various management organizational changes,
including early retirement incentives and related pension benefit expenses
arising from the retirement of the Company's former chief executive
officer, recruitment expenses related to the recent election of a new chief
executive officer and severance and other costs related to additional
personnel changes. The resulting decline in operating income by $2,300,000
reduced net income by $1,386,000 (after income tax benefit of $914,000) and
lowered fiscal 2005 diluted earnings per share by $0.15.

      Following a period of product introduction, marketing efforts and an
analysis of second quarter fiscal 2003 results, it was determined that
spending constraints placed on targeted customers by health care cost
pressures and state and local government budget deficits had significantly
reduced the future net cash flows expected to be realized from the
Company's Aurion product line. Accordingly, the Company recorded a non-cash
pre-tax charge of $2,750,000, or $0.19 per diluted share for the fiscal
quarter ended March 31, 2003, to recognize an impairment in the value of
assets for the Aurion product line. The operating results for Aurion were
not significant for any period presented. Based on the estimated
identifiable cash flows from this service offering, the impairment charge
represented the Company's entire investment in Aurion-related inventories,
fixed assets, licenses, software, and badge components.

12.   GEOGRAPHIC INFORMATION

      The Company operates in a single business segment, radiation
monitoring services. The Company provides these services primarily to
customers in the United States, as well as to customers in other geographic
markets. The following table shows the geographical distribution of
revenues for the fiscal years ended September 30, 2005, 2004 and 2003:

(DOLLARS IN THOUSANDS)                       2005      2004       2003
----------------------                      -------   -------    -------
Domestic . . . . . . . . . . . . . . . . .  $61,056   $58,133    $54,618
Europe - France and UK . . . . . . . . . .   10,068     8,104      6,891
Other countries. . . . . . . . . . . . . .    4,097     3,572      3,309
                                            -------   -------    -------
                                            $75,221   $69,809    $64,818
                                            =======   =======    =======

      Revenues of Nagase-Landauer, Ltd., the Company's joint venture in
Japan, are not consolidated and are not included in the above table.
Unaudited revenues of Nagase-Landauer, Ltd. for fiscal years 2005, 2004,
and 2003 were $13,892,000, $13,687,000, and $14,227,000, respectively. See
Note 3 for additional information on Nagase-Landauer, Ltd.

      The Company does not have any significant long-lived assets in
foreign countries.











                                     42


<PAGE>


13. ACQUISITION OF MINORITY INTEREST IN LCIE-LANDAUER, LTD.

      In April 2004, Landauer, Inc. consummated an agreement with Bureau
Veritas ("BV") to acquire the 49% minority interest in LCIE-Landauer, Ltd.
owned by BV's subsidiary, Laboratoire Central Industries des Electriques
("LCIE"), for $10.4 million in cash. The purchase price was allocated to
identifiable intangible assets based on estimates of fair value as
determined by an independent third party valuation consultant.
Substantially all of the purchase price, plus deferred tax liabilities
recorded, was allocated to intangible assets including $3.9 million of
customer lists (amortized over the estimated useful life of 15 years) and
goodwill of $7.9 million. Had the acquisition occurred at the beginning of
the periods presented, unaudited net income of the Company, on a proforma
basis, would have been as follows (amounts in thousands, except per share
data):

                                                     YEAR ENDED
                                                    SEPTEMBER 30
                                                  2004        2003
                                                 -------     -------
Proforma Net Income. . . . . . . . . . . . . .   $17,887     $15,367
Diluted earnings per share . . . . . . . . . .   $  1.99     $  1.73

      The unaudited proforma net income is for illustrative purposes only
and is not necessarily indicative of the financial results had the
acquisition actually occurred at the beginning of the periods presented.

      Landauer funded the purchase price from a combination of working
capital funds in the amount of $2.7 million and $7.7 million borrowed under
a credit facility obtained in April 2004. See Note 6 for additional
information on the credit facility.







































                                     43


<PAGE>


           REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


To Stockholders and Directors of Landauer, Inc.:

We have completed an integrated audit of Landauer, Inc.'s 2005 consolidated
financial statements and of its internal control over financial reporting
as of September 30, 2005, and audits of its 2004 and 2003 consolidated
financial statements in accordance with the standards of the Public Company
Accounting Oversight Board (United States).  Our opinions, based on our
audits, are presented below.

CONSOLIDATED FINANCIAL STATEMENTS
---------------------------------

In our opinion, the consolidated financial statements listed in the index
appearing under Item 15(a)(1) present fairly, in all material respects, the
financial position of Landauer, Inc. and its subsidiaries at September 30,
2005 and 2004, and the results of their operations and their cash flows for
each of the three years in the period ended September 30, 2005, in
conformity with accounting principles generally accepted in the United
States of America.  These financial statements are the responsibility of
the Company's management.  Our responsibility is to express an opinion on
these financial statements based on our audits.  We conducted our audits of
these statements in accordance with the standards of the Public Company
Accounting Oversight Board (United States).  Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement.  An audit of
financial statements includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

INTERNAL CONTROL OVER FINANCIAL REPORTING
-----------------------------------------

Also, in our opinion, management's assessment, included in Management's
Report on Internal Control over Financial Reporting appearing under Item
9A, that the Company maintained effective internal control over financial
reporting as of September 30, 2005, based on criteria established in
Internal Control - Integrated Framework issued by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO), is fairly
stated, in all material respects, based on those criteria. Furthermore, in
our opinion, the Company maintained, in all material respects, effective
internal control over financial reporting as of September 30, 2005, based
on criteria established in Internal Control - Integrated Framework issued
by the COSO.  The Company's management is responsible for maintaining
effective internal control over financial reporting and for its assessment
of the effectiveness of internal control over financial reporting.  Our
responsibility is to express opinions on management's assessment and on the
effectiveness of the Company's internal control over financial reporting
based on our audit. We conducted our audit of internal control over
financial reporting in accordance with the standards of the Public Company
Accounting Oversight Board (United States).  Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether
effective internal control over financial reporting was maintained in all
material respects.  An audit of internal control over financial reporting
includes obtaining an understanding of internal control over financial
reporting, evaluating management's assessment, testing and evaluating the
design and operating effectiveness of internal control, and performing such
other procedures as we consider necessary in the circumstances.  We believe
that our audit provides a reasonable basis for our opinions.







                                     44


<PAGE>


A company's internal control over financial reporting is a process designed
to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes
in accordance with generally accepted accounting principles.  A company's
internal control over financial reporting includes those policies and
procedures that (i) pertain to the maintenance of records that, in
reasonable detail, accurately and fairly reflect the transactions and
dispositions of the assets of the company; (ii) provide reasonable
assurance that transactions are recorded as necessary to permit preparation
of financial statements in accordance with generally accepted accounting
principles, and that receipts and expenditures of the company are being
made only in accordance with authorizations of management and directors of
the company; and (iii) provide reasonable assurance regarding prevention or
timely detection of unauthorized acquisition, use, or disposition of the
company's assets that could have a material effect on the financial
statements.

Because of its inherent limitations, internal control over financial
reporting may not prevent or detect misstatements.  Also, projections of
any evaluation of effectiveness to future periods are subject to the risk
that controls may become inadequate because of changes in conditions, or
that the degree of compliance with the policies or procedures may
deteriorate.



PricewaterhouseCoopers LLP
Chicago, Illinois
December 12, 2005









































                                     45


<PAGE>


ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
        AND FINANCIAL DISCLOSURE

      None.

ITEM 9A. CONTROLS AND PROCEDURES

DISCLOSURE CONTROLS AND PROCEDURES

      As of the end of the period covered by this report, an evaluation was
performed under the supervision and with the participation of the Company's
management, including the Chief Executive Officer ("CEO") and the Chief
Financial Officer ("CFO") (the Company's principal executive officer and
principal financial officer, respectively), of the effectiveness of the
design and operation of the Company's disclosure controls and procedures as
defined in Rule 13(a)-15(e) and 15d-15(e) under the Securities and Exchange
Act of 1934, as amended (the "Exchange Act"). Based upon that evaluation,
the Company's CEO and CFO concluded that the Company's disclosure controls
and procedures as of September 30, 2005 were effective.

MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

      Management of the Company is responsible for establishing and
maintaining adequate internal control over financial reporting, as such
term is defined in Exchange Act Rules 13a-15(f) and 15d-15(f). The
Company's internal control over financial reporting is a process designed
to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external purposes
in accordance with generally accepted accounting principles in the United
States of America. Because of its inherent limitations, internal control
over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods are
subject to the risk that controls may become inadequate because of changes
in conditions, or that the degree of compliance with the policies or
procedures may deteriorate.

      Management, including the CEO and CFO, has assessed the effectiveness
of the Company's internal control over financial reporting as of
September 30, 2005, based on the criteria described in Internal Control -
Integrated Framework issued by the Committee of Sponsoring Organizations of
the Treadway Commission (COSO). Based on its assessment, management
concluded that the Company's internal control over financial reporting was
effective as of September 30, 2005.

      Management's assessment of the effectiveness of the Company's
internal control over financial reporting as of September 30, 2005 has been
audited by PricewaterhouseCoopers LLP, an independent registered public
accounting firm, as stated in their Report of Independent Registered Public
Accounting Firm which is included in Item 8. "Consolidated Financial
Statements and Supplementary Data" on pages 44-45.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

      There have been no changes in the Company's internal control over
financial reporting that occurred during the period ended September 30,
2005 that have materially affected, or are reasonably likely to materially
affect, the Company's internal control over financial reporting.

ITEM 9B. OTHER INFORMATION

      None.









                                     46


<PAGE>


                                  PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

      Information pursuant to this Item relating to the directors of the
Company, contained under the headings "Election of Directors" and
"Beneficial Ownership of Common Stock" in the Proxy Statement, is
incorporated herein by reference. Information pursuant to this Item
relating to the Company's Audit Committee and the Company's code of ethics
contained under the heading "Board of Directors and Committees" in the
Proxy Statement is incorporated herein by reference.

The executive officers of the Company are as follows:

NAME OF OFFICER         AGE   POSITION

William E. Saxelby      49    President and Chief Executive Officer
James M. O'Connell      58    Vice President, Finance, Treasurer,
                              Secretary, and Chief Financial Officer
R. Craig Yoder          53    Senior Vice President, Marketing
                              and Technology
Robert M. Greaney       52    Vice President - Operations

      Mr. Saxelby joined the Company in September 2005 as President and
Chief Executive Officer. Previously, he served as Chief Executive Officer
of Medical Research Laboratories, a manufacturer of defibrillators, prior
to its sale to Welch Allyn in 2003, and consulted with certain private
equity firms between 2003 and 2005. Prior to joining Medical Research
Laboratories, he served as a Corporate Vice President of Allegiance
Healthcare from 1996 to 1999, and from 1978 to 1996 he held executive
positions at Baxter International and its American Hospital Supply
subsidiary.

      Mr. O'Connell, prior to joining the Company in September 1990, served
in various financial capacities in the telecommunications, manufacturing
and financial services industries.

      Dr. Yoder was elected to his position after serving as the Company's
Vice President of Operations since 1994 and Technology Manager since
joining in 1983. Prior to joining the Company, he was a member of the
senior technical staff at Pennsylvania Power and Light, and at Battelle
Pacific Northwest Laboratory.

      Mr. Greaney was elected to his position in February 2001. He has held
positions of increasing responsibility involving operations and project
management since joining the Company in 1973.

      There are no family relationships between any director or executive
officer and any other director or executive officer of the Company.

ITEM 11.  EXECUTIVE COMPENSATION

      Except for the information relating to Item 13 hereof and except for
information referred to in Item 402(a)(8) of Regulation S-K, the
information contained under the headings "Executive Compensation" and
"Compensation Committee Report" in the Proxy Statement is incorporated
herein by reference.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
          AND RELATED STOCKHOLDER MATTERS

      The information contained under the headings "Beneficial Ownership of
Common Stock" and "Equity Compensation Plan Information" in the Proxy
Statement is incorporated herein by reference.






                                     47


<PAGE>


ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

      Except for the information relating to Item 11 hereof and except for
information referred to in Item 402(a)(8) of Regulation S-K, the
information contained under the headings "Election of Directors" and
"Independence of Directors" in the Proxy Statement is incorporated herein
by reference.

ITEM 14.  PRINCIPAL ACCOUNTING FEES AND SERVICES

      The information contained under the heading "Fees Billed by
Independent Auditors" in the Proxy Statement is incorporated herein by
reference.



                                   PART IV

ITEM 15.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES

(a)   The following documents are filed as part of this report:

      (1)   Financial Statements -- The financial statements of
            Landauer listed on page 3 herein.

      (2)   Financial Statement Schedules - None.

      (3)   Exhibits - The following exhibits:

(3)(a)      Certificate of Incorporation of the Registrant, as amended
            through February 4, 1993, is incorporated by reference to
            Exhibit (3)(a) to the Annual Report on Form 10-K for
            the fiscal year ended September 30, 1993.

(3)(b)      By-laws of the Registrant are incorporated by reference to
            Exhibit (3)(b) to the Annual Report on Form 10-K for the fiscal
            year ended September 30, 1992.

(4)(a)      Specimen common stock certificate of the Registrant
            incorporated by reference to Exhibit (4)(a) to the Annual
            Report on Form 10-K for the fiscal year ended September 30,
            1997.

(10)(a)     The Landauer, Inc. 1996 Equity Plan, as amended and restated
            through November 8, 2001, is incorporated by reference to
            Exhibit (10)(a) to the Annual Report on Form 10-K for the
            fiscal year ended September 30, 2002.

(10)(b)     Liability Assumption and Sharing Agreement among Tech/Ops,
            Inc., Tech/Ops Sevcon, Inc., and the Registrant is incorporated
            by reference to Exhibit (10)(d) to the Annual Report on Form
            10-K for the fiscal year ended September 30, 1993.

(10)(c)     Form of Indemnification Agreement between the Registrant and
            each of its directors is incorporated by reference to Exhibit
            (10)(e) to the Annual Report on Form 10-K for the fiscal year
            ended September 30, 1993.

(10)(d)     Landauer, Inc. Directors' Retirement Plan dated March 21, 1990
            is incorporated by reference to Exhibit (10)(f) to the Annual
            Report on Form 10-K for the fiscal year ended September 30,
            1996.

(10)(e)     Form of Supplemental Key Executive Retirement Plan of Landauer,
            Inc., as amended and restated effective October 1, 2003, is
            incorporated by reference to Exhibit (10)(e) to the Annual
            Report on Form 10-K for the fiscal year ended September 30,
            2003.


                                     48


<PAGE>


(10)(f)     The Landauer, Inc. Incentive Compensation Plan for Executive
            Officers is incorporated by reference to Exhibit 10(h) to the
            Annual Report on Form 10-K for the fiscal year ended
            September 30, 2000.

(10)(g)     The Landauer, Inc. 1997 Non-Employee Director's Stock Option
            Plan, as amended and restated through November 8, 2001, is
            incorporated by reference to Exhibit (10)(g) to the Annual
            Report on Form 10-K for the fiscal year ended September 30,
            2003.

(10)(h)     Employment agreements dated February 29, 1996 between the
            Registrant and Brent A. Latta, James M. O'Connell and R. Craig
            Yoder are incorporated by reference to the Annual Report on
            Form 10-K for the fiscal year ended September 30, 1998.

(10)(i)     Employment agreement dated November 9, 2002 between the
            Registrant and Robert M. Greaney is incorporated by reference
            to Exhibit (10)(i) to the Annual Report on Form 10-K for the
            fiscal year ended September 30, 2003.

(10)(j)     The Landauer, Inc. Executive Special Severance Plan dated
            May 22, 2003 is incorporated by reference to Exhibit (10)(j) to
            the Annual Report on Form 10-K for the fiscal year ended
            September 30, 2003.

(10)(k)     The Credit Agreement between Landauer, Inc. and LaSalle Bank
            N.A. is incorporated by reference to Exhibit 10.1 to the
            Quarterly Report on Form 10-Q for the quarter ended June 30,
            2004.

(10)(l)     Form of stock option award pursuant to the Landauer, Inc. 1996
            Equity Plan, as amended and restated through November 8, 2001,
            is incorporated by reference to Exhibit 10(l) to the Annual
            Report on Form 10-K for the fiscal year ended September 30,
            2004.

(10)(m)     The Landauer, Inc. 2005 Long-Term Incentive Plan is attached
            hereto as Exhibit (10)(m).

(10)(n)     Form of stock option award pursuant to the Landauer, Inc. 2005
            Long-Term Incentive Plan is attached hereto as Exhibit (10)(n).

(10)(o)     Form of director's restricted share award pursuant to the
            Landauer, Inc. 2005 Long-Term Incentive Plan is attached hereto
            as Exhibit (10)(o).

(10)(p)     Form of key employee restricted share award pursuant to the
            Landauer, Inc. 2005 Long-Term Incentive plan is attached hereto
            as Exhibit (10)(p).

(10)(q)     Employment agreement dated September 28, 2005 between the
            Registrant and William E. Saxelby is attached hereto as Exhibit
            (10)(q).

(10)(r)     Amendment dated September 27, 2005 to the employment agreement
            between the Registrant and Brent A. Latta is attached hereto as
            Exhibit (10)(r).

(10)(s)     Amendment dated March 25, 2005 to the Credit Agreement between
            Landauer, Inc. and LaSalle Bank N.A. is attached hereto as
            Exhibit (10)(s).








                                     49


<PAGE>


(21)        Subsidiaries of the registrant are:

            Beijing-Landauer, Ltd. (70%)        SAPRA-Landauer, Ltda. (75%)
            Beijing, P.R. China                 Sao Carlos - SP - Brazil

            HomeBuyer's Preferred, Inc.         Nagase-Landauer, Ltd.
            (100%)                              (50%)
            Glenwood, IL  60425-1586            Tokyo, Japan

            LCIE-Landauer, Ltd.
            and subsidiary (100%)
            Paris, France
            Oxford, United Kingdom

31.1        Certification of William E. Saxelby, President and Chief
            Executive Officer, as adopted pursuant to Section 302 of the
            Sarbanes-Oxley Act of 2002 filed herewith.

31.2        Certification of James M. O'Connell, Chief Financial Officer,
            as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of
            2002 filed herewith.

32.1        Certification of William E. Saxelby, President and Chief
            Executive Officer, pursuant to 18 U.S.C. Section 1350, as
            adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
            2002 furnished herewith.

32.2        Certification of James M. O'Connell, Chief Financial Officer,
            pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
            Section 906 of the Sarbanes-Oxley Act of 2002 furnished
            herewith.

      Exhibits 10(a), 10(d), 10(e), 10(f), 10(g), 10(h), 10(i), 10(j),
10(l), 10(m), 10(n), 10(o), 10(p), 10(q), and 10(r) listed above are the
management contracts and compensatory plans or arrangements required to be
filed as exhibits hereto pursuant to the requirements of Item 601 of
Regulation S-K.

































                                     50


<PAGE>


                                 SIGNATURES

      Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.


                        LANDAUER, INC.

                        By:   /s/ William E. Saxelby  December 13, 2005
                              ----------------------
                              William E. Saxelby
                              President and Chief
                              Executive Officer

      Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.

      Signature                       Title                     Date
      ---------                       -----                     ----

/s/ William E. Saxelby       President and Director      December 13, 2005
William E. Saxelby        (Principal Executive Officer)



/s/ James M. O'Connell      Vice President, Finance,     December 13, 2005
James M. O'Connell           Treasurer and Secretary
                            (Principal Financial and
                               Accounting Officer)


/s/ Robert J. Cronin                Director             December 13, 2005
Robert J. Cronin


/s/ E. Gail de Planque              Director             December 13, 2005
E. Gail de Planque


/s/ Gary D. Eppen                   Director             December 13, 2005
Gary D. Eppen


/s/ Stephen C. Mitchell             Director             December 13, 2005
Stephen C. Mitchell


/s/ Richard R. Risk                 Director             December 13, 2005
Richard R. Risk


/s/ Thomas M. White                 Director             December 13, 2005
Thomas M. White


/s/ Michael D. Winfield             Director             December 13, 2005
Michael D. Winfield











                                     51


<PAGE>


<table>

                                       QUARTERLY FINANCIAL DATA (UNAUDITED)

<caption>
                                                              (Amounts in Thousands, Except Per Share)
                                                      -------------------------------------------------------
                                                      First      Second       Third       Fourth       Total
                                                     Quarter     Quarter     Quarter      Quarter      Year
                                                     -------     -------     -------      -------     -------

                            <c>         <c>       <c>         <c>         <c>          <c>         <c>

Net revenues                    2005                 $18,325     $19,706     $18,200      $18,990     $75,221
                                2004                 $16,778     $18,262     $17,203      $17,566     $69,809

Gross profit                    2005                 $11,231     $12,444     $11,129      $12,109     $46,913
                                2004                 $10,640     $11,897     $10,767      $11,053     $44,357

Operating income (1)            2005                 $ 6,720     $ 7,904     $ 6,642      $ 5,285     $26,551
                                2004                 $ 6,359     $ 7,667     $ 6,717      $ 6,977     $27,720

Net income                      2005                 $ 4,430     $ 5,143     $ 4,531      $ 3,104     $17,208
                                2004                 $ 4,005     $ 4,839     $ 4,394      $ 4,532     $17,770

Diluted net income
  per share (1)                 2005                 $  0.49     $  0.57     $  0.50      $  0.34     $  1.90
                                2004                 $  0.45     $  0.54     $  0.49      $  0.50     $  1.98

Cash dividends per share        2005                 $ 0.425     $ 0.425     $ 0.425      $ 0.425     $  1.70
                                2004                 $  0.40     $  0.40     $  0.40      $  0.40     $  1.60

Common stock price per share    2005        high     $ 50.30     $ 49.16     $ 53.00      $ 54.00     $ 54.00
                                             low       44.60       42.88       44.44        47.38       42.88

                                2004        high     $ 41.96     $ 44.75     $ 44.73      $ 47.97     $ 47.97
                                             low       35.48       40.05       38.71        41.45       35.48

Weighted Average Diluted
  Shares Outstanding            2005                   9,019       9,025       9,039        9,071       9,038
                                2004                   8,930       8,978       8,976        8,999       8,971

<fn>

  (1) Includes reorganization charge of $2,300,000, reducing net income by $1,386,000 (after income tax benefit of
      $914,000) or $0.15 per diluted share in the fourth quarter of fiscal year 2005.






                                                        52
</table>