Annual Meeting Remarks 1/10/07

01 / 10 / 2007

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Marty is a Corporate Vice President of the Company and is now responsible for our Medical Devices Segment. Marty spoke at last year's Annual Meeting representing our Industrial Segment in describing the FCS Controls acquisition. He's been with Moog since 1980 and over his career has worked in Aircraft, Space and Defense, our Industrial Segment and now Medical Devices. Marty is a life-long resident of Western New York except for a three-year assignment in the early '90's when he and his family lived in Germany while he was the General Manager of our German company. Marty has a Bachelor's degree in Physics from Canisius and an MBA from St. Bonaventure. In addition to his career with the Company, he's been active in a number of local and national business organizations. He recently completed a term as the Chairman of the National Fluid Power Association. He's currently Co-Chairman of the Life Sciences Council of the Buffalo Niagara Partnership.

Here's Marty.

Thanks Marty.

Thanks guys. As I said, a little while ago, these presentations describe only a few interesting facets of our various business segments and it's hardly a comprehensive description of our entire enterprise.

Let me move now to our forecast for fiscal '07. Currently, we're forecasting sales of $1.438 billion plus or minus about $10 million. This is a forecast without the potential of any acquisitions. If we achieve the mid-range forecast, it will represent an organic sales increase of about 10%.

In the Aircraft business, we're projecting total sales of $548 million, an increase of 4%. The increase will come on the commercial side. Commercial sales will increase as a result of increased activity with Boeing Commercial, including the early revenues on the new 787, and an increase in production for Business Jets. Original equipment sales on military aircraft will actually be down somewhat. We're in that period on the F-35 when development revenue winds down and production begins slowly. We are looking for increases in both the military and commercial aftermarket.

In Space and Defense, we're projecting another 15% increase to a total of $170 million. The big story in '07 will be continued growth in Defense Controls including increased delivery on the Light Armored Vehicle program for the Marine Corp and the development work that Mike described on Future Combat Systems.

In our Industrial segment, we're projecting '07 sales in the range between $412 and $432 million, the mid-point, $422 million. This sales level would be an 11% increase over '06. We're looking for increased sales in the plastics market and an up-tick in metal forming and test equipment. We expect a leveling off in the sales of turbine controls, simulator equipment and gauge controls for steel mills.

Given the fantastic growth of the Components Group in '06, we're projecting a more down-to-earth 9% increase for fiscal '07. This would result in sales of $258 million. We are expecting continued growth in components used in the medical market and industrial systems and we're looking for moderate growth in military aircraft and defense controls. We think that our sales of military products have, in the last couple of years, been influenced by the conflict in the Mideast and that the current level may continue, but not grow at last year's rate. Perhaps conservatively, we're forecasting a similar effect in Mike Glister's marine products.

As Marty mentioned, we're anticipating sales in the medical market of $40 million.

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