Teledyne Technologies Inc. (NYSE:TDY) Q1 2018 Earnings Conference Call - Final Transcript
May 03, 2018 • 11:00 am ET
well as in our manufacturing. And the reason for this is, the budget, for a change, is got a very healthy increase in electronic warfare, which helps us a lot, because that's what we do in most of our products. And also, two other things, one is, the Virginia-class submarine program, where we have a significant business in, that's going to continue about two per year. And missile defense is up, which is where our Teledyne Brown Engineering, which is part of our systems engineering segment does a lot of work. So, overall, I would say, the defense budget increases have been very healthy for us. I must have conclude by saying, because the budget came in late, there are some issues about being able to -- for the government to be able to get the numbers out -- to get the awards also. The awards and contracts are lagging the 10% so far outside their closest to 5%.
Thank you, Greg.
Next, we have the line of Jim Ricchiuti with Needham & Company. Your line is open.
Hi, thank you. Robert, I'm little surprised that you see the kind of organic growth over the balance of the year in the Digital Imaging segment being strong as it is. Is that mainly coming from the X-ray detector and MEMS businesses? I would assume, you've got tougher comparisons I had in the industrial machines vision area, or you just see that is continuing to be a good growth area over the balance of year?
Thanks Jim, and good morning to you.
Let me just note, first, on a larger picture. Our Digital Imaging ground rate, right now is about $800 million. Of that, machine vision is about $285 million. So about 6% of that or less than $50 million is in flat panel displays. As you know, there is a little bit of concern about flat panel displays. When you look at the overall budget in Digital Imaging, that business, that part of business is only 6% of Digital Imaging, and less than 1.8% of Teledyne as a whole. So if that goes up and down, goes down a little, it's not going to change things for us, where we are enjoying really good out lift is in the lot of barcode ID's, senors, cameras for identifications. We also have a very strong ophthalmology digital program. We have also -- where we do -- provide cameras for optical coherence tomography. We have other things in printing, factory automation. Of course, we have a strong program in defense and space. And we have a -- some -- we also play some in food and solar recycling and other sensors. So, all in all, what we anticipate is that, we may have a little headwind as some people are project in FPD, but that's not going to effect us much, because the business portfolio in Digital Imaging is very well distributed among many industries, and like the portfolio for