Aerospace operating profit for the first quarter of 2012 was $11.9 million, or 19.2% of sales, compared with $9.3 million, or 18.6% of sales, in the same period last year. The increase in the 2012 first quarter margin reflects leverage gained from increased sales volume partially offset by higher E&D and increased SG&A expenses. The SG&A increase was due to the addition of Ballard’s SG&A as well as higher legal and compensation expenses.

Bookings for the Aerospace segment during the first quarter were $58.6 million, up 20.3% from $48.7 million in the first quarter of 2011, and up 8.5% from bookings of $54.0 million in the trailing fourth quarter of 2011. Backlog at the end of the first quarter was $94.5 million.

Test Systems Segment Review (refer to sales by market and segment data in accompanying tables)

Sales in the 2012 first quarter decreased to $3.1 million when compared with $4.9 million for the same period in 2011.

Test Systems operating loss for the first quarter of 2012 was $1.1 million compared with break even in the same period last year.

Test Systems bookings in the first quarter of $2.3 million were down when compared with $5.8 million in the first quarter of 2011, and down from the trailing 2012 fourth quarter, which had bookings of $2.5 million. Backlog was $7.5 million at the end of the first quarter.

Balance Sheet

Cash at the end of the 2012 first quarter declined by $2.7 million to $8.2 million compared with December 31, 2011, primarily as a result of the early extinguishment in January, 2012 of a $5.0 million, 6% subordinated note and increased investment in net working capital assets.

Capital expenditures during the first quarter of 2012 were $1.7 million compared with $0.8 million in 2011.

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