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Teledyne hopeful of imaging rebound

27 Jan 2021

Company sees strong bookings in the closing quarter of 2020, as both X-ray and optical imaging sectors recover.

Digital imaging, aerospace electronics and advanced instrumentation provider Teledyne Technologies has reported solid financial results for the closing quarter of 2020, alongside expectations of a strong recovery across imaging applications this year.

In the three months ending December 29, the firm’s digital imaging business unit posted sales of $262 million, down slightly on the equivalent period in 2019.

“The fourth quarter 2020 net sales primarily reflected lower sales of X-ray detectors for dental and medical imaging, partially offset by greater sales of infrared and visible detectors for space applications,” explained the Thousand Oaks, California, company.

Full-year sales for the division totalled $986 million, down a little on the 2019 total. Overall, the wider Teledyne business - comprising instrumentation, defense electronics, and advanced engineering systems as well as imaging - came in at $3.1 billion, down slightly on the prior year.

Imaging recovery
However, executive chairman Robert Mehrabian struck an optimistic tone when assessing the prospects for 2021 - with the imaging business set to lead the way, even ahead of the planned $8 billion acquisition of FLIR Systems.

He said: “We enter 2021 with a clear improvement in demand across the majority of our businesses. In fact, we received record orders in the fourth quarter and ended 2020 with a record backlog.

“While it's still early in [the year], we are expecting continuing recovery in our commercial business, as well as growth in our government business - in both cases, strongest within our digital imaging segment.”

Mehrabian predicted that digital imaging sales should be up around 10 per cent this year, with applications in industrial machine vision and scientific cameras set to enjoy the strongest recovery.

Pointing to very strong bookings activity in the December quarter, he said: “[This] bodes well for us, [as it] cuts across all of our businesses - including aerospace, defense electronics, and MEMS systems.”

‘Uniquely complementary’
Turning to the FLIR acquisition, which Teledyne revealed at the start of January and should be completed by the end of June, Mehrabian told an investor conference call:

“We’ve been watching FLIR since we first entered the space-based infrared imaging market in 2006, when we acquired Teledyne Scientific & Imaging. We believed then - and we believe now - that our infrared imaging technologies and market segments are uniquely complementary.”

Since then, Mehrabian observed, the two companies have evolved to become even more complementary. “For example, Teledyne entered the sub-sea drone business in 2008, and FLIR entered the airborne unmanned business in 2016 - and more recently the land-based robotics business,” Mehrabian said.

“While our respective technologies and market segments are different, the fundamental desire of our end customers is an image. Or even better: information. This is true for X-ray imaging, infrared imaging, industrial machine vision, and even our underwater marine sonar imaging and software businesses.

“In other words there is similarity and synergy in digitization, imaging algorithms, machine learning, and other related technologies across each of our organizations.”

To help fund the FLIR deal and refinance some existing debt, Teledyne has already arranged a $4.5 billion one-year credit commitment. The company says it expects to complete the purchase with new financing.

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