10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

x Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended June 30, 2012

or

¨ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from              to             

Commission File Number 0-7087

ASTRONICS CORPORATION

(Exact name of registrant as specified in its charter)

New York	16-0959303
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification Number)
130 Commerce Way, East Aurora, New York	14052
(Address of principal executive offices)	(Zip code)

(716) 805-1599

(Registrant’s telephone number, including area code)

NOT APPLICABLE

(Former name, former address and former fiscal year, if changed since last report)

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

$.01 par value Common Stock, $.01 par value Class B Stock

(Title of Class)

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, and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “large accelerated filer”, an “accelerated filer”, a “non-accelerated filer” and a “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	¨	Accelerated filer	x
Non-accelerated filer	¨	Smaller Reporting Company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  x

As of June 30, 2012, 12,396,288 shares of common stock were outstanding consisting of 9,783,503 shares of common stock ($.01 par value) and 2,612,785 shares of Class B common stock ($.01 par value).

TABLE OF CONTENTS

				PAGE
PART 1	FINANCIAL INFORMATION
	Item 1	Financial Statements:
		•	Consolidated Condensed Balance Sheets as of June 30, 2012 and December 31, 2011	3
		•	Consolidated Condensed Statements of Operations for the Three and Six Months Ended June 30, 2012 and July 2, 2011	4
		•	Consolidated Condensed Statements of Comprehensive Income for the Three and Six Months Ended June 30, 2012 and July 2, 2011	5
		•	Consolidated Condensed Statements of Cash Flows for the Six Months Ended June 30, 2012 and July 2, 2011	6
		•	Notes to Consolidated Condensed Financial Statements	7 - 18
	Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations		19 -24
	Item 3	Quantitative and Qualitative Disclosures about Market Risk		24
	Item 4	Controls and Procedures		24
PART II	OTHER INFORMATION
	Item 1	Legal Proceedings		25
	Item 1a	Risk Factors		25
	Item 2	Unregistered Sales of Equity Securities and Use of Proceeds		26
	Item 3	Defaults Upon Senior Securities		26
	Item 4	Mine Safety Disclosures		26
	Item 5	Other Information		26
	Item 6	Exhibits		26
SIGNATURES				27 - 30
	EX-31.1	302 Certification for CEO
	EX-31.2	302 Certification for CFO
	EX-32.1	906 Certification for CEO and CFO
	EX-101	Instance Document
	EX-101	Schema Document
	EX-101	Calculation Linkbase Document
	EX-101	Labels Linkbase Document
	EX-101	Presentation Linkbase Document
	EX-101	Definition Linkbase Document

2

Part 1 – Financial Information

Item 1. Financial Statements

ASTRONICS CORPORATION

Consolidated Condensed Balance Sheets

June 30, 2012 with Comparative Figures for December 31, 2011

(In thousands)

	June 30, 2012		December 31, 2011
	(Unaudited)
Current Assets:
Cash and Cash Equivalents	$	8,168	$	10,919
Accounts Receivable, net of allowance for doubtful accounts		43,536		35,669
Inventories		44,572		40,094
Other Current Assets		5,567		5,628
Total Current Assets		101,843		92,310
Property, Plant and Equipment, net of accumulated depreciation		43,562		41,122
Deferred Income Taxes		8,886		7,039
Other Assets		2,749		3,249
Intangible Assets, net of accumulated amortization		13,347		14,000
Goodwill		17,185		17,185
Total Assets	$	187,572	$	174,905
Current Liabilities:
Current Maturities of Long-term Debt	$	5,273	$	5,290
Accounts Payable		11,164		10,559
Accrued Expenses		11,692		11,568
Accrued Income Taxes		340		—
Billings in Excess of Recoverable Costs and Accrued Profits on Uncompleted Contracts		—		264
Customer Advance Payments and Deferred Revenue		10,556		5,796
Total Current Liabilities		39,025		33,477
Long-term Debt		20,484		27,973
Other Liabilities		16,437		10,592
Total Liabilities		75,946		72,042
Shareholders’ Equity:
Common Stock		129		129
Other Shareholders’ Equity		111,497		102,734
Total Shareholders’ Equity		111,626		102,863
Total Liabilities and Shareholders’ Equity	$	187,572	$	174,905

See notes to consolidated condensed financial statements

3

ASTRONICS CORPORATION

Consolidated Condensed Statements of Operations

Three and Six Months Ended June 30, 2012 With Comparative Figures for 2011

(Unaudited)

(In thousands, except per share data)

	Six Months Ended				Three Months Ended
	June 30, 2012		July 2, 2011		June 30, 2012		July 2, 2011
Sales	$	130,127	$	110,603	$	64,989	$	55,475
Cost of Products Sold		94,953		81,711		47,935		41,089
Gross Profit		35,174		28,892		17,054		14,386
Selling, General and Administrative Expenses		18,133		13,489		9,278		7,144
Income from Operations		17,041		15,403		7,776		7,242
Interest Expense, Net of Interest Income		529		1,071		266		534
Income Before Income Taxes		16,512		14,332		7,510		6,708
Provision for Income Taxes		5,223		4,575		2,316		2,160
Net Income	$	11,289	$	9,757	$	5,194	$	4,548
Earnings per share:
Basic	$	0.91	$	0.81	$	0.42	$	0.37
Diluted	$	0.86	$	0.76	$	0.39	$	0.35

See notes to consolidated condensed financial statements.

4

ASTRONICS CORPORATION

Consolidated Condensed Statements of Comprehensive Income

Three and six months ended June 30, 2012 With Comparative Figures for 2011

(Unaudited)

(In thousands)

	Six Months Ended					Three Months Ended
	June 30, 2012			July 2, 2011		June 30, 2012			July 2, 2011
Net Income	$	11,289		$	9,757	$	5,194		$	4,548
Other Comprehensive Income:
Foreign Currency Translation Adjustments		(7	)		203		(117	)		(1	)
Mark to Market Adjustments for Derivatives – Net of Tax		50			37		27			(13	)
Retirement Liability Adjustment – Net of Tax		(3,587	)		45		140			22
Other Comprehensive (Loss) Income		(3,544	)		285		50			8
Comprehensive Income	$	7,745		$	10,042	$	5,244		$	4,556

See notes to consolidated condensed financial statements.

5

ASTRONICS CORPORATION

Consolidated Condensed Statements of Cash Flows

Six months ended June 30, 2012

With Comparative Figures for 2011

(Unaudited)

(In thousands)

	June 30, 2012			July 2, 2011
Cash Flows from Operating Activities:
Net Income	$	11,289		$	9,757
Adjustments to Reconcile Net Income to Cash Provided by (Used For) Operating Activities:
Depreciation and Amortization		2,831			2,394
Provision for Non-Cash Losses on Inventory and Receivables		574			597
Stock Compensation Expense		723			537
Deferred Tax Expense		(476	)		370
Other		143			(85	)
Cash Flows from Changes in Operating Assets and Liabilities:
Accounts Receivable		(7,903	)		(4,735	)
Inventories		(5,021	)		(3,559	)
Accounts Payable		607			(774	)
Other Current Assets and Liabilities		265			(701	)
Billings in Excess of Recoverable Costs and Accrued Profits on Uncompleted Contracts		(264	)		(393	)
Customer Advanced Payments and Deferred Revenue		4,760			(147	)
Income Taxes		1,049			(17	)
Supplemental Retirement and Other Liabilities		381			(88	)
Cash Provided By Operating Activities		8,958			3,156
Cash Flows from Investing Activities:
Capital Expenditures		(4,496	)		(6,979	)
Cash Used For Investing Activities		(4,496	)		(6,979	)
Cash Flows from Financing Activities:
Payments for Long-term Debt		(7,507	)		(3,499	)
Proceeds from Exercise of Stock Options		151			490
Income Tax Benefit from Exercise of Stock Options		144			196
Cash Used For Financing Activities		(7,212	)		(2,813	)
Effect of Exchange Rates on Cash		(1	)		2
Decrease in Cash and Cash Equivalents		(2,751	)		(6,634	)
Cash and Cash Equivalents at Beginning of Period		10,919			22,709
Cash and Cash Equivalents at End of Period	$	8,168		$	16,075

See notes to consolidated condensed financial statements.

6

ASTRONICS CORPORATION

Notes to Consolidated Condensed Financial Statements

June 30, 2012

(Unaudited)

1) Basis of Presentation

The accompanying unaudited statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information. Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments, consisting of normal recurring accruals, considered necessary for a fair presentation have been included.

Operating Results

The results of operations for any interim period are not necessarily indicative of results for the full year. Operating results for the three and six month periods ended June 30, 2012 are not necessarily indicative of the results that may be expected for the year ending December 31, 2012.

The balance sheet at December 31, 2011 has been derived from the audited financial statements at that date, but does not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements.

For further information, refer to the financial statements and footnotes thereto included in Astronics Corporation’s 2011 annual report on Form 10-K.

Description of the Business

Astronics is a leading supplier of advanced, high-performance lighting systems, electrical power generation and distribution systems, avionics databus solutions, enhanced vision systems, aircraft safety systems for the global aerospace industry as well as test, training and simulation systems primarily for the military. We sell our products to airframe manufacturers (OEMs) in the commercial transport, business jet and military markets as well as FAA/Airport, OEM suppliers and aircraft operators around the world. The Company provides its products through its wholly owned subsidiaries Luminescent Systems, Inc. (“LSI”), Luminescent Systems Canada, Inc. (“LSI Canada”), DME Corporation (“DME”), Ballard Technology, Inc. (“Ballard”), Max-Viz Inc. (“Max-Viz”) and Astronics Advanced Electronic Systems Corp. (“AES”). On November 30, 2011, Astronics acquired 100% of the stock of Ballard. Ballard designs and produces avionics databus solutions for defense and commercial aerospace applications. Ballard is part of our Aerospace segment. On July 30, 2012 Astronics acquired 100% of the stock of Max-Viz, Inc. Max-Viz is a manufacturer of industry‑leading Enhanced Vision Systems for defense and commercial aerospace applications for the purpose of improving situational awareness.

The Company has two reportable segments, Aerospace and Test Systems. The Aerospace segment designs and manufactures products for the global aerospace industry. The Test Systems segment designs, manufactures and maintains communications and weapons test systems and training and simulation devices for military applications.

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated. Acquisitions are accounted for under the purchase method and, accordingly, the operating results for the acquired companies are included in the consolidated statements of earnings from the respective dates of acquisition.

Revenue and Expense Recognition

In the Aerospace segment, revenue is recognized on the accrual basis at the time of shipment of goods and transfer of title. There are no significant contracts allowing for right of return.

In the Test Systems segment, revenue of approximately 39% and 68% for the three months ending June 30, 2012 and July 2, 2011 respectively and approximately 39% and 83% for the six months ending June 30, 2012 and July 2, 2011 respectively, is recognized from long-term, fixed-price contracts using the percentage-of-completion method of accounting, measured by multiplying the estimated total contract value by the ratio of actual contract costs incurred to date to the estimated total contract costs. Substantially all long-term contracts are with U.S. government agencies and contractors thereto. The Company makes significant estimates involving its usage of percentage-of-completion accounting to recognize contract revenues. The Company periodically reviews contracts in process for estimates-to-completion, and revises estimated gross profit accordingly. While the Company believes

7

its estimated gross profit on contracts in process is reasonable, unforeseen events and changes in circumstances can take place in a subsequent accounting period that may cause the Company to revise its estimated gross profit on one or more of its contracts in process. Accordingly, the ultimate gross profit realized upon completion of such contracts can vary significantly from estimated amounts between accounting periods. Revenue not recognized using the percentage-of-completion method is recognized at the time of shipment of goods and transfer of title.

Cost of Products Sold, Engineering and Development and Selling, General and Administrative Expenses

Cost of products sold includes the costs to manufacture products such as direct materials and labor and manufacturing overhead as well as all engineering and developmental costs. The Company is engaged in a variety of engineering and design activities as well as basic research and development activities directed to the substantial improvement or new application of the Company’s existing technologies. These costs are expensed when incurred and included in cost of sales. Research and development, design and related engineering amounted to $11.1 million and $8.8 million for the three months ended June 30, 2012 and July, 2, 2011 respectively and $21.1 million and $17.1 million for the six months ended June 30, 2012 and July 2, 2011, respectively. Selling, general and administrative expenses include costs primarily related to our sales and marketing departments and administrative departments. Interest expense is shown net of interest income. Interest income was insignificant for each of the three and six months ended for both June 30, 2012 and July 2, 2011.

Financial Instruments

The Company’s financial instruments consist primarily of cash and cash equivalents, accounts receivable, accounts payable, notes payable, long-term debt and interest rate swaps. The Company performs periodic credit evaluations of its customers’ financial condition and generally does not require collateral and the Company does not hold or issue financial instruments for trading purposes. Due to their short-term nature the carrying value of cash and equivalents, accounts receivable, accounts payable, and notes payable, if any, approximate fair value. The carrying value of the Company’s variable rate long-term debt also approximates fair value due to the variable rate feature of these instruments. The Company’s interest rate swaps are recorded at fair value as described under Note 16  ‑ Fair Value and Note 17 ‑ Derivative Financial Instruments.

Derivatives

The accounting for changes in the fair value of derivatives depends on the intended use and resulting designation. The Company’s use of derivative instruments is limited to cash flow hedges for interest rate risk associated with long-term debt. Interest rate swaps are used to adjust the proportion of total debt that is subject to variable and fixed interest rates. The interest rate swaps are designated as hedges of the amount of future cash flows related to interest payments on variable-rate debt that, in combination with the interest payments on the debt, convert a portion of the variable-rate debt to fixed-rate debt. The Company records all derivatives on the balance sheet at fair value as described under Note 16 - Fair Value and Note 17 ‑ Derivative Financial Instruments. The related gains or losses, to the extent the derivatives are effective as a hedge, are deferred in shareholders’ equity as a component of Accumulated Other Comprehensive Income (Loss) (AOCI). Any ineffectiveness is immediately recorded in the statement of operations.

Foreign Currency Translation

The Company accounts for its foreign currency translation in accordance with ASC Topic 830, Foreign Currency Translation. The aggregate transaction gain or loss included in operations was insignificant for the periods ending June 30, 2012 and July 2, 2011.

Loss contingencies

Loss contingencies may from time to time arise from situations such as warranty claims and other legal actions. Loss contingencies are recorded as liabilities when it is probable that a liability has been incurred and the amount of the loss is reasonably estimable. Disclosure is required when there is a reasonable possibility that the ultimate loss will exceed the recorded provision. Contingent liabilities are often resolved over long time periods. In recording liabilities for probable losses, management is required to make estimates and judgments regarding the amount or range of the probable loss. Management continually assesses the adequacy of estimated loss contingencies and, if necessary, adjusts the amounts recorded as better information becomes known.

8

Accounting Pronouncements Adopted in 2012

On January 1, 2012, the Company adopted the new provisions of Accounting Standards Update (“ASU”) No. 2011-05, Comprehensive Income (Topic 220). The amendments in this Update require an entity to report all non-owner changes in stockholders’ equity either in a single continuous statement of comprehensive income or in two separate but consecutive statements. The ASU prohibits the presentation of the components of comprehensive income in the statement of stockholder’s equity. The amendments are effective for annual and interim periods beginning after December 15, 2011 and should be applied retrospectively. In December 2011, the Financial Accounting Standards Board issued ASU No. 2011-12, Comprehensive Income (Topic 220): Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05). The amendments in this Update defer the effective date pertaining only to reclassification adjustments out of accumulated other comprehensive income in Accounting Standards Update 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income, until the Financial Accounting Standards Board is able to reconsider those presentation requirements. Other than requiring an additional statement and disclosures, the impact on the Company’s financial statements was not significant.

On January 1, 2012, the Company adopted the new provisions of ASU No. 2011-04, “Fair Value Measurement (Topic 820) – Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS.” The amendments provide a consistent definition of fair value and ensure that the fair value measurement and disclosure requirements are similar between U.S. GAAP and International Financial Reporting Standards. The amendments also change certain fair value measurement principles and enhance the disclosure requirements, particularly for Level 3 fair value measurements. The amendments are effective during interim and annual periods beginning after December 15, 2011 and should be applied prospectively. Other than requiring additional disclosures, the adoption of this amendment did not have a material impact on our consolidated financial statements.

On January 1, 2012, the Company adopted the new provisions of ASU No. 2011-08, Intangibles - Goodwill and Other (Topic 350). The amendments in this Update will allow an entity to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. Under these amendments, an entity would not be required to calculate the fair value of a reporting unit unless the entity determines, based on a qualitative assessment, that it is more likely than not that its fair value is less than its carrying amount. The amendments are effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011. The adoption of this pronouncement had no impact on the Company’s financial statements.

2) Inventories

Inventories are stated at the lower of cost or market, cost being determined in accordance with the first-in, first-out method. Inventories are as follows:

(In thousands)	June 30, 2012		December 31, 2011
Finished Goods	$	10,546	$	7,420
Work in Progress		8,089		8,477
Raw Material		25,937		24,197
	$	44,572	$	40,094

The Company records valuation reserves to provide for excess, slow moving or obsolete inventory or to reduce inventory to the lower of cost or market value. In determining the appropriate reserve, the Company considers the age of inventory on hand, the overall inventory levels in relation to forecasted demands as well as reserving for specifically identified inventory that the Company believes is no longer salable.

9

3) Property, Plant and Equipment

The following table summarizes Property, Plant and Equipment as follows:

(In thousands)	June 30, 2012		December 31, 2011
Land	$	2,819	$	2,819
Buildings and Improvements		22,774		22,760
Machinery and Equipment		39,209		37,289
Construction in Progress		10,239		7,702
		75,041		70,570
Less Accumulated Depreciation		31,479		29,448
	$	43,562	$	41,122

4) Intangible Assets

The following table summarizes acquired intangible assets as follows:

		June 30, 2012				December 31, 2011
(In thousands)	Weighted Average Life	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Patents	12 Years	$	1,271	$	735	$	1,271	$	685
Trade Names	0 - 10 Years		1,853		72		1,853		7
Completed and Unpatented Technology	10 - 15 Years		5,277		1,472		5,277		1,242
Backlog and Customer Relationships	3 - 20 Years		9,985		2,760		9,985		2,452
Total Intangible Assets		$	18,386	$	5,039	$	18,386	$	4,386

All acquired intangible assets other than goodwill and one trade name are being amortized. Amortization expense for acquired intangibles is summarized as follows:

	Six Months Ended				Three Months Ended
(In thousands)	June 30, 2012		July 2, 2011		June 30, 2012		July 2, 2011
Amortization Expense	$	653	$	217	$	304	$	103

Amortization expense for intangible assets for each of the next five years is summarized as follows:

(In thousands)
2012	$	1,261
2013		1,215
2014		1,215
2015		1,170
2016		1,166

5) Goodwill

The following table summarizes the changes in the carrying amount of goodwill for 2012:

(In thousands)	December 31, 2011		Foreign Currency Translation		June 30, 2012
Aerospace Segment	$	17,185	$	—	$	17,185

6) Long-term Debt and Notes Payable

The Company extended and modified its existing credit facility by entering into a Second Amended and Restated Credit Agreement (the “Credit Agreement”), dated August 31, 2011. The Company’s Credit Agreement provides for a revolving credit line in the amount of $35 million, less outstanding letters of credit, through August 31, 2016 and for the Company’s $16 million term loan maturing January 30, 2014, with interest on both loans at a rate of LIBOR plus between 1.50% and 2.50% based on the Company’s

10

Leverage Ratio. The credit facility allocates up to $20 million of the $35 million revolving credit line for the issuance of letters of credit, including certain existing letters of credit. The credit facility is secured by substantially all of the Company’s assets.

Prior to the August 31, 2011 amendment of the credit facility, the Company’s Credit Agreement provided for a revolving credit line of $35 million for working capital requirements which was committed through January 2012, with interest at LIBOR plus between 2.75% and 4.50%. In addition, the Company was required to pay a commitment fee of between 0.30% and 0.50% on the unused portion of the total credit commitment for the preceding quarter, based on the Company’s leverage ratio under the Credit Agreement.

There was nothing outstanding on our revolving credit facility at June 30, 2012 and December 31, 2011. The Company had available on its credit facility $23.3 million at June 30, 2012. The credit facility allocates up to $20 million of the revolving credit line for the issuance of letters of credit. At June 30, 2012, outstanding letters of credit totaled $11.7 million. In addition, the Company is required to pay a commitment fee quarterly at a rate of between 0.25% and 0.35% per annum on the unused portion of the total revolving credit commitment, also based on the Company’s Leverage Ratio.

The $5.0 million subordinated promissory note with interest fixed at 6.0% was paid in its entirety on January 13, 2012.

7) Product Warranties

In the ordinary course of business, the Company warrants its products against defects in design, materials and workmanship typically over periods ranging from twelve to sixty months. The Company determines warranty reserves needed by product line based on experience and current facts and circumstances. Activity in the warranty accrual is summarized as follows:

	Six months ended						Three Months Ended
(In thousands)	June 30, 2012			July 2, 2011			June 30, 2012			July 2, 2011
Balance at beginning of period	$	1,092		$	1,699		$	1,448		$	1,657
Warranties issued		772			987			246			448
Warranties settled		(473	)		(953	)		(303	)		(408	)
Reassessed warranty exposure		—			(343	)		—			(307	)
Balance at end of period	$	1,391		$	1,390		$	1,391		$	1,390

8) Income Taxes

The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial reporting and tax basis of assets and liabilities. Deferred tax assets are reduced, if deemed necessary, by a valuation allowance for the amount of tax benefits which are not expected to be realized. Investment tax credits are recognized on the flow through method.

ASC Topic 740-10 “Overall - Uncertainty in Income Taxes” (“ASC Topic 740-10”) clarifies the accounting and disclosure for uncertainty in tax positions. ASC Topic 740-10 seeks to reduce the diversity in practice associated with certain aspects of the recognition and measurement related to accounting for income taxes. The Company is subject to the provisions of ASC Topic 740-10 and has analyzed filing positions in all of the federal and state jurisdictions where it is required to file income tax returns, as well as all open tax years in these jurisdictions. Should the Company need to accrue a liability for uncertain tax benefits, any interest associated with that liability will be recorded as interest expense. Penalties, if any, would be recognized as operating expenses. There are no penalties or interest liability accrued as of June 30, 2012 or December 31, 2011, nor are any penalties or interest costs included in expense for the periods ending June 30, 2012 and July 2, 2011. The years under which we conducted our evaluation coincided with the tax years currently still subject to examination by major federal and state tax jurisdictions, those being 2010 through 2011 for federal purposes and 2008 through 2011 for state purposes.

The effective tax rate was 31.6% and 31.9% for the six months and 30.8% and 32.2% for the three months ended June 30, 2012 and July 2, 2011, respectively. The effective tax rate for the three and six months of 2012 was impacted primarily by the domestic production activity deduction, as well as lower state and foreign taxes. The effective tax rate for the three and six months of 2011 was impacted primarily by the domestic production activity deduction as well as the impact of domestic R&D tax credits, offset somewhat by higher state and foreign taxes.

11

9) Shareholders’ Equity

The changes in shareholders’ equity for the six months ended June 30, 2012 are summarized as follows:

				Number of Shares
	Amount			Common Stock			Convertible Class B Stock
Shares Authorized					20,000,000			5,000,000
Share Par Value				$	0.01		$	0.01
(Dollars in thousands)
COMMON STOCK
Beginning of Period	$	129			9,680,825			3,194,229
Conversion of Class B Shares to Common Shares		—			249,793			(249,793	)
Exercise of Stock Options		—			31,431			18,144
End of Period	$	129			9,962,049			2,962,580
ADDITIONAL PAID IN CAPITAL
Beginning of Period	$	19,279
Stock Compensation Expense		723
Exercise of Stock Options		295
End of Period	$	20,297
ACCUMULATED OTHER COMPREHENSIVE LOSS
Beginning of Period	$	(886	)
Foreign Currency Translation Adjustment		(7	)
Mark to Market Adjustment for Derivatives		50
Retirement Liability Adjustment		(3,587	)
End of Period	$	(4,430	)
RETAINED EARNINGS
Beginning of Period	$	86,622
Net Income		11,289
End of Period	$	97,911
TREASURY STOCK
Beginning of Period	$	(2,281	)		(178,546	)		(349,795	)
Purchase (disposal)		—			—			—
End of Period	$	(2,281	)		(178,546	)		(349,795	)
TOTAL SHAREHOLDERS’ EQUITY
Beginning of Period	$	102,863			9,502,279			2,844,434
End of Period	$	111,626			9,783,503			2,612,785

10) Earnings Per Share

Basic and diluted weighted-average shares outstanding are as follows:

	Six Months Ended				Three Months Ended
(In thousands)	June 30, 2012		July 2, 2011		June 30, 2012		July 2, 2011
Basic earnings per share weighted average shares		12,374		12,093		12,390		12,107
Net effect of dilutive stock options		764		739		772		766
Diluted earnings per share weighted average shares		13,138		12,832		13,162		12,873

On August 2, 2011, Astronics Corporation announced a one-for-ten distribution of Class B Stock to holders of both Common and Class B Stock. On or about August 30, 2011, stockholders received one share of Class B Stock for every ten shares of Common and Class B Stock held on the record date of August 16, 2011. All share quantities, share prices and per share data reported throughout this report have been adjusted to reflect the impact of this distribution.

12

11) Comprehensive Income and Accumulated Other Comprehensive Income (Loss)

The components of accumulated other comprehensive income (loss) are as follows:

(In thousands)	June 30, 2012			Dec. 31, 2011
Foreign Currency Translation Adjustments	$	1,225		$	1,232
Mark to Market Adjustments for Derivatives – Before Tax		(316	)		(393	)
Tax Benefit		110			137
Mark to Market Adjustments for Derivatives – After Tax		(206	)		(256	)
Retirement Liability Adjustment – Before Tax		(8,415	)		(2,865	)
Tax Benefit		2,966			1,003
Retirement Liability Adjustment – After Tax		(5,449	)		(1,862	)
Accumulated Other Comprehensive Loss	$	(4,430	)	$	(886	)

The components of other comprehensive income (loss) are as follows:

	Six Months Ended						Three Months Ended
(In thousands)	June 30, 2012			July 2, 2011			June 30, 2012			July 2, 2011
Foreign Currency Translation Adjustments	$	(7	)	$	203		$	(117	)	$	(1	)
Reclassification to Interest Expense		114			155			54			78
Mark to Market Adjustments for Derivatives		(37	)		(98	)		(12	)		(98	)
Tax Expense		(27	)		(20	)		(15	)		7
Mark to Market Adjustments for Derivatives		50			37			27			(13	)
Retirement Liability Adjustment		(5,550	)		69			183			34
Tax (Expense) Benefit		1,963			(24	)		(43	)		(12	)
Retirement Liability Adjustment		(3,587	)		45			140			22
Other Comprehensive (Loss) Income	$	(3,544	)	$	285		$	50		$	8

12) Supplemental Retirement Plan and Related Post Retirement Benefits

The Company has two non-qualified supplemental retirement defined benefit plans (“SERP” and “SERP II”) for certain executive officers. The following table sets forth information regarding the net periodic pension cost for the plans.

	Six Months Ended				Three Months Ended
(In thousands)	June 30, 2012		July 2, 2011		June 30, 2012		July 2, 2011
Service cost	$	128	$	24	$	88	$	12
Interest cost		252		164		147		82
Amortization of prior service cost		181		54		122		27
Amortization of net actuarial losses		46		6		23		3
Net periodic cost	$	607	$	248	$	380	$	124

13

Participants in the SERP are entitled to paid medical, dental and long-term care insurance benefits upon retirement under the plan. The following table sets forth information regarding the net periodic cost recognized for those benefits:

	Six Months Ended					Three Months Ended
(In thousands)	June 30, 2012		July 2, 2011			June 30, 2012		July 2, 2011
Service cost	$	1	$	—		$	—	$	—
Interest cost		12		14			6		7
Amortization of prior service cost		13		12			7		6
Amortization of net actuarial gains		—		(2	)		—		(1	)
Net periodic cost	$	26	$	24		$	13	$	12

On March 6, 2012 the Company adopted a second non-qualified supplemental retirement defined benefit plan (“SERP II”) for eligible executive officers. The Company recorded a liability at the date of adoption of $5.8 million for the projected benefit obligation. Pension cost of the new plan for the year ending December 31, 2012 is estimated to be approximately $0.8 million. The plan is unfunded and the Company does not expect to make and contributions to the plan, nor does it expect any benefits will be paid from the plan in 2012.

13) Sales to Major Customers

The Company has a significant concentration of business with two major customers, Panasonic Aviation Corporation and various departments of the U.S. Government, primarily branches of the Department of Defense and the Federal Aviation Administration. The following is information relating to the activity with those customers:

	Six Months Ended						Three Months Ended
	June 30, 2012			July 2, 2011			June 30, 2012			July 2, 2011
Percent of consolidated revenue
Panasonic		37	%		34	%		32	%		31	%
U.S. Government		8	%		10	%		7	%		8	%

(In thousands)	June 30, 2012		Dec. 31, 2011
Accounts Receivable
Panasonic	$	12,872	$	9,878
U.S. Government		2,776		3,866

14) Legal Proceedings

The Company is subject to various legal proceedings, claims, and litigation arising in the ordinary course of business. While the outcome of these matters is currently not determinable, we do not expect these matters will have a material adverse effect on our business, financial position, results of operations, or cash flows. However, the results of these matters cannot be predicted with certainty. Should the Company fail to prevail in any legal matter or should several legal matters be resolved against the Company in the same reporting period, then the financial results of that particular reporting period could be materially adversely affected.

On November 11, 2010, AE Liquidation Inc. filed an action in the United States Bankruptcy Court for the District of Delaware (AE Liquidation, Inc., et al v. Luminescent Systems Inc., and AE Liquidation, Inc., et al., v Astronics Advanced Electronic Systems Corp.) seeking to recover $1.4 million of alleged preferential payments received from Eclipse Aviation Corporation. The Company disputes the Trustee’s allegations and believes any loss, as a result of future proceedings would not have a material adverse effect on our business. We intend to defend this claim vigorously.

We are a defendant in an action filed in the Regional State Court of Mannheim, Germany (Lufthansa Technik AG v. Astronics Advanced Electronics Systems Corp.) relating to an allegation of patent infringement. The damages sought include injunctive relief, as well as monetary damages. We dispute the allegation and intend to vigorously defend ourselves in this action. We have filed a nullity action with the Federal Patent Court in Munich Germany, requesting the court to revoke the German part of the European patent that is subject to the claim. In November 2011, the regional state court of Manheim Germany, issued an interim decision to the effect that the infringement litigation proceedings be stayed

14

until the Federal Patent Court decides on the concurrent nullity action. At this time we are unable to provide a reasonable estimate of our potential liability or the potential amount of loss related to this action, if any. If the outcome of this litigation is adverse to us, our results and financial condition could be materially affected.

15) Segment Information

Below are the sales and operating profit by segment for the three and six months ended June 30, 2012 and July 2, 2011 and a reconciliation of segment operating profit to earnings before income taxes. Operating profit is the net sales less cost of sales and other operating expenses excluding interest and other expenses and corporate expenses. Cost of sales and other operating expenses are directly identifiable to the respective segment.

	Six Months Ended						Three Months Ended
(Dollars in thousands)	June 30, 2012			July 2, 2011			June 30, 2012			July 2, 2011
Sales
Aerospace	$	124,424		$	102,141		$	62,423		$	51,942
Test Systems		5,703			8,462			2,566			3,533
Sales	$	130,127		$	110,603		$	64,989		$	55,475
Operating Profit (Loss) and Margins
Aerospace	$	22,781		$	18,330		$	10,903		$	9,011
		18.3	%		17.9	%		17.5	%		17.3	%
Test Systems		(2,393	)		(528	)		(1,318	)		(545	)
		(42.0	)%		(6.2	)%		(51.4	)%		(15.4	)%
Total Operating Profit		20,388			17,802			9,585			8,466
		15.7	%		16.1	%		14.7	%		15.3	%
Deductions from Operating Profit
Interest Expense		529			1,071			266			534
Corporate Expenses and Other		3,347			2,399			1,809			1,224
Income Before Income Taxes	$	16,512		$	14,332		$	7,510		$	6,708

Identifiable Assets

(In thousands)	June 30, 2012		Dec. 31, 2011
Aerospace	$	152,736	$	136,930
Test Systems		18,133		20,020
Corporate		16,703		17,955
Total Assets	$	187,572	$	174,905

16) Fair Value

ASC Topic 820, “Fair value Measurements and Disclosures”, (“ASC Topic 820”) defines fair value, establishes a framework for measuring fair value and expands the related disclosure requirements. This statement applies under other accounting pronouncements that require or permit fair value measurements. The statement indicates, among other things, that a fair value measurement assumes that the transaction to sell an asset or transfer a liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability. ASC Topic 820 defines fair value based upon an exit price model. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and involves consideration of factors specific to the asset or liability.

ASC Topic 820 establishes a valuation hierarchy for disclosure of the inputs to valuation used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows:

Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.

15

Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument.

Level 3 inputs are unobservable inputs based on our own assumptions used to measure assets and liabilities at fair value.

On a Recurring Basis:

A financial asset or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. The following table provides the financial assets and liabilities carried at fair value measured on a recurring basis as of June 30, 2012 and December 31, 2011:

(In thousands)	Classification	Total			Level 1		Level 2			Level 3
Interest rate swaps	Other Liabilities
June 30, 2012		$	(316	)	$	—	$	(316	)	$	—
December 31, 2011			(393	)		—		(393	)		—
Acquisition contingent consideration	Other Liabilities
June 30, 2012		$	(741	)	$	—	$	—		$	(741	)
December 31, 2011			(720	)		—		—			(720	)

Interest rate swaps are securities with no quoted readily available Level 1 inputs, and therefore are measured at fair value using inputs that are directly observable in active markets and are classified within Level 2 of the valuation hierarchy, using the income approach (See Note 17).

Our Level 3 fair value liabilities represent contingent consideration recorded related to the Ballard acquisition to be paid up to a maximum of $5.5 million if certain revenue growth targets are met over the next five years. The amounts recorded were calculated using an estimate of the probability of the future cash outflows. The varying contingent payments were then discounted to the present value utilizing a discounted cash flow methodology. The contingent consideration liability has no observable Level 1 or Level 2 inputs. There was no significant change in the fair value of this liability from December 31, 2011.

On a Non-recurring Basis:

In accordance with the provisions of ASC Topic 350 “Intangibles – Goodwill and Other” the Company estimates the fair value of reporting units, utilizing unobservable Level 3 inputs. Level 3 inputs require significant management judgment due to the absence of quoted market prices or observable inputs for assets of a similar nature. The Company utilizes a discounted cash flow analysis to estimate the fair value of reporting units utilizing unobservable inputs. The fair value measurement of the reporting unit under the step-one and step-two analysis of the goodwill impairment test are classified as Level 3 inputs.

Intangible assets that are amortized are evaluated for recoverability whenever adverse effects or changes in circumstances indicate that the carrying value may not be recoverable. The recoverability test consists of comparing the undiscounted projected cash flows with the carrying amount. Should the carrying amount exceed undiscounted projected cash flows, an impairment loss would be recognized to the extent the carrying amount exceeds fair value. For indefinite-lived intangible assets, the impairment test consists of comparing the fair value, determined using the relief from royalty method, with its carrying amount. An impairment loss would be recognized for the carrying amount in excess of its fair value.

At June 30, 2012, the fair value of goodwill and intangible assets classified using Level 3 inputs are as follows:

• Beginning January 1, 2012, previously unamortized trade names in the Test Systems segment with a fair value of $0.4 million are now being amortized over 10 years. The fair value measurement of total amortized intangible assets in the Test Systems reporting unit is $3.9 million. Inputs used to calculate the fair value were internal forecasts used to estimate undiscounted future cash flows. There was no change in fair value from December 31, 2011.

• The Ballard goodwill and intangible assets acquired on November 30, 2011, were valued at fair value using a discounted cash flow methodology and are classified as Level 3 inputs.

16

As of June 30, 2012, the Company concluded that no indicators of intangible or goodwill impairment existed and an interim test was not performed.

Due to their short-term nature, the carrying value of cash and equivalents, accounts receivable, accounts payable, and notes payable approximate fair value. The carrying value of the Company’s variable rate long-term debt also approximates fair value due to the variable rate feature of these instruments.

17) Derivative Financial Instruments

At June 30, 2012, we had interest rate swaps consisting of the following:

a) An interest rate swap with a notional amount of approximately $2.2 million at June 30, 2012, entered into on February 6, 2006, related to the Company’s Series 1999 New York Industrial Revenue Bond which effectively fixes the rate at 3.99% plus a spread based on the Company’s leverage ratio on this obligation through February 1, 2016.

b) An interest rate swap with a notional amount of $7.0 million at June 30, 2012, entered into on March 19, 2009 related to the Company’s term note issued January 30, 2009. The swap effectively fixes the rate at 2.115% plus a spread based on the Company’s leverage ratio on the notional amount (which decreases in concert with the scheduled note repayment schedule). The swap agreement became effective October 1, 2009 and expires January 30, 2014.

At June 30, 2012 and December 31, 2011, the fair value of interest rate swaps was a liability of $0.3 million and $0.4 million respectively, which is included in other long-term liabilities (See Note 16). Amounts expected to be reclassified to earnings in the next 12 months is approximately $0.1 million.

To the extent the interest rate swaps are not perfectly effective in offsetting the change in the value of the payments being hedged; the ineffective portion of these contracts is recognized in earnings immediately as interest expense. Ineffectiveness, if any, was not significant for the three and six months ended June 30, 2012 and July 2, 2011, respectively. The Company classifies the cash flows from hedging transactions in the same category as the cash flows from the respective hedged items. Amounts from ineffectiveness, if any, to be reclassified during 2012 are not expected to be significant.

Activity in accumulated other comprehensive income (“AOCI”) related to these derivatives is summarized below:

	Six Months Ended						Three Months Ended
(In thousands)	June 30, 2012			July 2, 2011			June 30, 2012			July 2, 2011
Derivative balance at the beginning of the period in AOCI	$	(256	)	$	(338	)	$	(233	)	$	(288	)
Net deferral in AOCI of derivatives:
Net (increase) decrease in fair value of derivatives		(37	)		(98	)		(12	)		(98	)
Tax effect		14			35			4			35
		(23	)		(63	)		(8	)		(63	)
Net reclassification from AOCI into earnings:
Reclassification from AOCI into earnings – Interest expense		114			155			54			78
Tax effect		(41	)		(55	)		(19	)		(28	)
		73			100			35			50
Net change in derivatives for the period		50			37			27			(13	)
Derivative balance at the end of the period in AOCI	$	(206	)	$	(301	)	$	(206	)	$	(301	)

18) Recent Accounting Pronouncements

The Company’s management has reviewed recent accounting pronouncements issued through the date of the issuance of financial statements. In management’s opinion, none of these new pronouncements apply or will have a material effect on the Company’s financial statements.

17

19) Subsequent Events

On July 30, 2012 we acquired 100% of the stock of Max-Viz, Inc. (“Max-Viz”) a manufacturer of industry-leading Enhanced Vision Systems for defense and commercial aerospace applications for the purpose of improving situational awareness. Max-Viz will be included in our aerospace reporting segment. The addition of Max-Viz diversifies the products and technologies that Astronics offers. We purchased the outstanding stock of Max-Viz for $10.0 million in cash plus contingent purchase consideration up to a maximum of $8.0 million subject to meeting certain revenue growth targets over the next three years. The additional contingent purchase consideration will be recorded at its estimated fair value at the date of acquisition based upon the Company’s assessment of the probability of Max-Viz achieving the revenue growth targets.

The allocation of the purchase price paid for Max-Viz will be based on fair values of the acquired assets and liabilities assumed of Max-Viz as of July 30, 2012. Max-Viz’s unaudited 2011 revenue was approximately $5.4 million.

18

Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(The following should be read in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in the Company’s Form 10-K for the year ended December 31, 2011.)

OVERVIEW

Astronics Corporation, through its subsidiaries Astronics Advanced Electronic Systems Corp., Ballard Technology, DME Corporation, Luminescent Systems Inc., Luminescent Systems Canada Inc., and Max- Viz, Inc. designs and manufactures electrical power generation systems, control and distribution systems, lighting systems and components, aircraft safety products, avionics databus solutions, enhanced vision systems and test, training and simulation systems. The Company operates in two distinct segments, Aerospace and Test Systems and has eight principal facilities. The Company has one location in each of New York State, New Hampshire, Oregon and Quebec, Canada and two facilities in each of Washington State, and Florida.

Our Aerospace segment serves four primary markets. They are the military, commercial transport, business jet and FAA/airport markets. We serve one primary market in the Test Systems segment, which is the military. Our strategy is to develop and maintain positions of technical leadership in chosen aerospace and test system markets, to leverage those positions to grow the amount of content and volume of product it sells to the markets in those segments and to selectively acquire businesses with similar technical capabilities that could benefit from our leadership position and strategic direction.

Key factors affecting our growth and profitability are the rate at which new aircraft are produced, government funding of military programs, our ability to have our products designed into the plans for new aircraft and the rates at which aircraft owners, including commercial airlines, refurbish or install upgrades to their aircraft. Once designed into a new aircraft, the spare parts business is frequently retained by the Company. We continue to look for opportunities in all of our markets to capitalize on our core competencies to expand our existing business and to grow through strategic acquisitions.

ACQUISITIONS

On July 30, 2012 we acquired 100% of the stock of Max-Viz, Inc. (“Max-Viz”) a manufacturer of industry-leading Enhanced Vision Systems for defense and commercial aerospace applications for the purpose of improving situational awareness. Max-Viz will be included in our aerospace reporting segment. The addition of Max-Viz diversifies the products and technologies that Astronics offers. We purchased the outstanding stock of Max-Viz for $10.0 million in cash plus contingent purchase consideration up to a maximum of $8.0 million subject to meeting certain revenue growth targets over the next three years. The additional purchase consideration will be recorded at its estimated fair value at the date of acquisition based upon the Company’s assessment of the probability of Max-Viz achieving the revenue growth targets.

CONSOLIDATED RESULTS OF OPERATIONS AND OUTLOOK

	Six Months Ended						Three Months Ended
(Dollars in thousands)	June 30, 2012			July 2, 2011			June 30, 2012			July 2, 2011
Sales	$	130,127		$	110,603		$	64,989		$	55,475
Gross Margin	$	35,174		$	28,892		$	17,054		$	14,386
Gross Margin Percentage		27.0	%		26.1	%		26.2	%		25.9	%
SG&A Expenses as a Percentage of Sales		13.9	%		12.2	%		14.3	%		12.9	%
Interest Expense, net of interest income	$	529		$	1,071		$	266		$	534
Effective Tax Rate		31.6	%		31.9	%		30.8	%		32.2	%
Net Earnings	$	11,289		$	9,757		$	5,194		$	4,548

A discussion by segment can be found at “Segment Results of Operations and Outlook” in this MD&A.

Our consolidated sales for the second quarter of 2012 increased by 17.2% to $65.0 million compared with $55.5 million for the same period last year. Aerospace sales increased by $10.5 million while Test Systems revenue decreased by $1.0 million. Consolidated sales for the first six months of 2012 increased by 17.7% to $130.1 million compared with $110.6 million for the same period last year. Aerospace sales increased by $22.3 million while Test Systems revenue decreased by $2.8 million in the first six months of 2012.

19

Consolidated gross margins improved slightly to 26.2% in the second quarter of 2012 compared with 25.9% in the second quarter of 2011. The improved margins were a result of leverage that was achieved from increased sales volumes in the Aerospace segment, offset by decreased margins due to lower sales volumes in the Test system segment as well as increased engineering and development (“E&D”) costs in the aerospace segment. E&D costs were $11.1 million in the second quarter of 2012 compared with $8.8 million in the same period of 2011. Consolidated gross margins improved to approximately 27.0% in the first six months of 2012 compared with approximately 26.1% in the first six months of 2011. The improved margins were a result of leverage that was achieved from increased sales volumes in the Aerospace segment, offset by decreased margins due to lower sales volumes in the Test system segment and increased E&D costs in the aerospace segment. E&D costs were $21.1 million in the first six months of 2012 compared with $17.1 million in the same period of 2011. We expect our full year consolidated E&D expenses for 2012 to be in the range of $40 million to $43 million.

Selling, general and administrative (“SG&A”) expenses were approximately $9.3 million, or 14.3% of sales in the second quarter of 2012, compared with $7.1 million, or 12.9% of sales in the same period last year. The increase was due primarily to the November 2011 acquisition of Ballard Technology (“Ballard”), which added $1.2 million to SG&A in the second quarter of 2012 as well as increased compensation costs incurred during the second quarter of 2012 when compared with the prior year. For the first six months of 2012, SG&A expenses were approximately $18.1 million, or 13.9% of sales, compared with $13.5 million, or 12.2% of sales in the same period last year. The increase was due primarily to the acquisition of Ballard, which added $2.4 million to SG&A in the first half of 2012 as well as increased compensation and increased legal expenses incurred during the period when compared with the prior year.

Interest expense, net of interest income for the second quarter decreased by $0.2 million from $0.5 million to $0.3 million and for the first six months decreased by $0.6 million from $1.1 million to $0.5 million. The decrease in interest for both the second quarter and the six months of 2012 was due primarily to a combination of lower interest rates and reduced debt levels when compared with the same periods last year.

The effective tax rates for the three and six months ended June 30, 2012 were 30.8% and 31.6 %, respectively, lower than would be expected by applying the U.S. federal statutory tax rate to earnings before income taxes. The effective tax rates for second quarter and first six months of 2012 were lower than the federal statutory rate, due to the domestic production activity deduction, lower tax rates on foreign income and foreign R&D tax credits. The second quarter and first six months of 2011 tax rates were lower than the federal statutory rate, due to the domestic production activity deduction, a lower tax rate on foreign income and the impact of domestic R&D tax credits.

Net income for the second quarter of 2012 was $5.2 million or $0.39 per diluted share, an increase of $0.7 million from $4.5 million, or $0.35 per diluted share in the second quarter of 2011. For the first six months of 2012, net income was $11.3 million or $0.86 per diluted share, an increase of $1.5 million from $9.8 million, or $0.76 per diluted share in the first half of 2011. The earnings per share increase in the second quarter and first six months of 2012 when compared with the same periods in 2011 is due to higher net income.

20

SEGMENT RESULTS OF OPERATIONS AND OUTLOOK

Operating profit, as presented below, is sales less cost of sales and other operating expenses, excluding interest expense and other corporate expenses. Cost of sales and other operating expenses are directly identifiable to the respective segment. Operating profit is reconciled to earnings before income taxes in Note 15 of the Notes to Consolidated Condensed Financial Statements included in this report.

AEROSPACE

	Six Months Ended						Three Months Ended
(In thousands)	June 30, 2012			July 2, 2011			June 30, 2012			July 2, 2011
Sales	$	124,424		$	102,141		$	62,423		$	51,942
Operating profit	$	22,781		$	18,330		$	10,903		$	9,011
Operating Margin		18.3	%		17.9	%		17.5	%		17.3	%

	June 30, 2012		Dec. 31, 2011
Total Assets	$	152,736	$	136,930
Backlog	$	107,699	$	97,903

Aerospace Sales by Market

	Six Months Ended				Three Months Ended
(In thousands)	June 30, 2012		July 2, 2011		June 30, 2012		July 2, 2011
Commercial Transport	$	85,287	$	67,196	$	41,179	$	34,271
Military		19,081		17,179		10,162		7,919
Business Jet		14,937		14,063		8,283		7,426
FAA/Airport		5,119		3,703		2,799		2,326
	$	124,424	$	102,141	$	62,423	$	51,942

Aerospace Sales by Product Line

	Six Months Ended				Three Months Ended
(In thousands)	June 30, 2012		July 2, 2011		June 30, 2012		July 2, 2011
Cabin Electronics	$	66,254	$	52,949	$	31,215	$	26,874
Aircraft Lighting		37,299		35,720		20,311		17,549
Airframe Power		9,712		9,769		5,183		5,193
Airfield Lighting		5,119		3,703		2,799		2,326
Avionics Databus		6,040		—		2,915		—
	$	124,424	$	102,141	$	62,423	$	51,942

In the second quarter, sales to the Commercial Transport market increased primarily on higher demand for Cabin Electronics products as global demand for passenger power systems continued to be strong. Additionally, increased sales of aircraft lighting, airframe power and the addition of Ballard’s avionics databus products acquired in November of 2011 added to the increase. Military sales increased compared with the prior year’s second quarter primarily as a result of higher aircraft lighting sales and the addition of avionics databus products. Sales to the Business Jet market were up slightly when compared with last year’s second quarter primarily from higher aircraft lighting sales. The increase in second quarter FAA airport sales was due to increased volume from the FAA.

In the first six months of 2012, sales to the Commercial Transport market increased primarily on higher demand for Cabin Electronics products, as well as increased sales of aircraft lighting, airframe power and the addition of Ballard’s avionics databus products. Military sales in the first six months were up compared with last year primarily as a result of the addition of avionics databus products offset by lower sales of aircraft lighting products and airframe power products. Sales to the Business Jet market were up slightly when compared with the first six months of last year as increased aircraft lighting sales were partially offset by lower airframe power sales. FAA/Airport sales in the first six months were higher as compared with last year from increased volume.

21

Aerospace operating profit for the second quarter of 2012 was $10.9 million, or 17.5% of sales, compared with $9.0 million, or 17.3% of sales, in the same period last year. The increase in the operating profit was due to leverage from the increased sales volume partially offset by increased E&D costs and increased compensation costs. SG&A expense increased from 2011 primarily due to the November 2011 acquisition of Ballard Technology, which added $1.2 million to SG&A in the second quarter of 2012 as well as increased compensation costs when compared with the prior year’s second quarter.

Aerospace operating profit for the first half of 2012 was $22.8 million, or 18.3% of sales, compared with $18.3 million, or 17.9% of sales, in the same period last year. The increase in the operating profit was due to leverage from the increased sales volume partially offset by increased E&D costs and increased compensation and legal expense. The increased SG&A expense for the first six months of 2012 was due primarily to the Ballard acquisition, which added $2.4 million to SG&A in the first half of 2012 as well as increased compensation expenses and increased legal expenses. Legal expenses increased by $0.5 million when compared with the prior year.

2012 Outlook for Aerospace – We are increasing our 2012 sales forecast for our Aerospace segment to be in the range of $250 million to $264 million. The Aerospace segment’s backlog at the end of the second quarter of 2012 was $107.7 million with approximately $76.2 million expected to be shipped over the remaining part of 2012 and $89.5 million is expected to ship over the next 12 months.

TEST SYSTEMS

	Six Months Ended						Three Months Ended
(In thousands)	June 30, 2012			July 2, 2011			June 30, 2012			July 2, 2011
Sales	$	5,703		$	8,462		$	2,566		$	3,533
Operating loss	$	(2,393	)	$	(528	)	$	(1,318	)	$	(545	)
Operating Margin		(42.0	)%		(6.2	)%		(51.4	)%		(15.4	)%

	June 30, 2012		Dec. 31, 2011
Total Assets	$	18,133	$	20,020
Backlog	$	6,504	$	8,409

All sales for the Test Systems segment are from the Military Market.

Sales in the 2012 second quarter decreased $0.9 million to $2.6 million when compared with sales of $3.5 million for the same period in 2011. Sales for the first half of 2012 decreased $2.8 million to $5.7 million when compared with sales of $8.5 million for the same period in 2011.

Test Systems operating loss for the second quarter of 2012 was $1.3 million or (51.4)%, compared with $0.5 million or (15.4)% in the same period last year. The operating loss for the first half of 2012 was $2.4 million or (42.0)%, compared with $0.5 million or (6.2)% in the same six month period last year. The margins for both the second quarter and first six months of 2012 from the lower sales volume were not sufficient to cover fixed operating costs.

2012 Outlook for Test Systems – We are maintaining our sales forecast for 2012 for our Test Systems segment to be in the range of $10 million to $11 million. The Test Systems segment’s backlog at the end of the second quarter of 2012 was $6.5 million with approximately $5.5 million expected to be shipped over the remaining part of 2012 and $6.5 million is expected to ship over the next 12 months.

22

LIQUIDITY AND CAPITAL RESOURCES

Cash provided by operating activities totaled $9.0 million during the first six months of 2012, as compared with $3.2 million during the first six months of 2011. The change was due to higher net income and less cash used for working capital components in 2012 compared with 2011.

Cash used for investing activities was $4.5 million in the first six months of 2012 compared with $7.0 million used in the first six months of 2011. In the first six months of 2011 we acquired real estate and a partially constructed building in Kirkland Washington for approximately $5 million. During 2012 we will be completing the building and our Astronics Advanced Electronic Systems Corp. subsidiary will move into that building near the end of 2012.

In the first six months of 2012 cash used for financing activities totaled $7.2 million compared with cash used by financing activities of $2.8 million in the first six months of 2011. The change was due primarily to the early payoff of the $5.0 million subordinated promissory note in January, 2012.

The Company expects capital spending in 2012 to be approximately $18 million to $20 million including the completion of the build out and occupation of the Kirkland property. Management believes that the Company’s cash flow from operations and revolving credit facility will be sufficient to provide funding for future capital requirements.

There was no balance outstanding on our revolving credit facility at June 30, 2012. The revolving credit facility provides for borrowing up to $35.0 million. The credit facility allocates up to $20 million of the revolving credit line for the issuance of letters of credit, including certain existing letters of credit totaling approximately $11.7 million at June 30, 2012. For working capital requirements, the Company had available on its credit facility, $23.3 million and $22.9 million at June 30, 2012 and December 31, 2011, respectively. At June 30, 2012, we were in compliance with all of the covenants pursuant to the credit facility.

In the event of voluntary or involuntary bankruptcy of the Company or any subsidiary, all unpaid principal and other amounts owing under the Credit Agreement automatically become due and payable. Other events of default, such as failure to make payments as they become due and breach of financial and other covenants, give the Agent the option to declare all such amounts immediately due and payable.

BACKLOG

The Company’s backlog at June 30, 2012 was $114.2 million compared with $106.3 million at December 31, 2011 and $102.1 million at July 2, 2011.

CONTRACTUAL OBLIGATIONS AND COMMITMENTS

Company’s contractual obligations and commercial commitments have not changed materially from those disclosed in the Company’s Form 10-K for the year ended December 31, 2011.

MARKET RISK

The Company believes that there have been no material changes in the current year regarding the market risk information for its exposure to currency exchange rates or interest rate fluctuations. Refer to the Company’s Annual Report on Form 10-K for the year ended December 31, 2011 for a complete discussion of the Company’s market risk.

CRITICAL ACCOUNTING POLICIES

Refer to the Company’s annual report on Form 10-K for the year ended December 31, 2011 for a complete discussion of the Company’s critical accounting policies.

RECENT ACCOUNTING PRONOUNCEMENTS

See Part 1, Note 1 and Note 18 to the Financial Statements – Basis of Presentation, Accounting Pronouncements Adopted in 2012.

23

FORWARD-LOOKING STATEMENTS

This Quarterly Report contains certain forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involves uncertainties and risks. These statements are identified by the use of the “may,” “will,” “should,” “believes,” “expects,” “expected,” “intends,” “plans,” “projects,” “estimates,” “predicts,” “potential,” “outlook,” “forecast,” “anticipates,” “presume” and “assume,” and words of similar import. Readers are cautioned not to place undue reliance on these forward looking statements as various uncertainties and risks could cause actual results to differ materially from those anticipated in these statements. These uncertainties and risks include the success of the Company with effectively executing its plans; successfully integrating its acquisitions; the timeliness of product deliveries by vendors and other vendor performance issues; changes in demand for our products from the U.S. government and other customers; the acceptance by the market of new products developed; our success in cross-selling products to different customers and markets; changes in government contracts; the state of the commercial and business jet aerospace market; the Company’s success at increasing the content on current and new aircraft platforms; the level of aircraft build rates; as well as other general economic conditions and other factors. Certain of these factors, risks and uncertainties are discussed in the sections of this report entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

Item 3. Quantitative and Qualitative Disclosures About Market Risk

See Market Risk in Item 2, above.

Item 4. Controls and Procedures

a) The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures as of June 30, 2012. Based on that evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of June 30, 2012.

b) Changes in Internal Control over Financial Reporting - There have been no changes in our internal control over financial reporting during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

24

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

The Company is subject to various legal proceedings, claims, and litigation arising in the ordinary course of business. While the outcome of these matters is currently not determinable, we do not expect these matters will have a material adverse effect on our business, financial position, results of operations, or cash flows. However, the results of these matters cannot be predicted with certainty. Should the Company fail to prevail in any legal matter or should several legal matters be resolved against the Company in the same reporting period, then the financial results of that particular reporting period could be materially adversely affected.

On November 11, 2010, AE Liquidation Inc. filed an action in the United States Bankruptcy Court for the District of Delaware (AE Liquidation, Inc., et al v. Luminescent Systems Inc., and AE Liquidation, Inc., et al., v Astronics Advanced Electronic Systems Corp.) seeking to recover $1.4 million of alleged preferential payments received from Eclipse Aviation Corporation. The Company disputes the Trustee’s allegations and believes any loss, as a result of future proceedings would not have a material adverse effect on our business. We intend to defend this claim vigorously.

We are a defendant in an action filed in the Regional State Court of Mannheim, Germany (Lufthansa Technik AG v. Astronics Advanced Electronics Systems Corp.) relating to an allegation of patent infringement. The damages sought include injunctive relief, as well as monetary damages. We dispute the allegation and intend to vigorously defend ourselves in this action. We have filed a nullity action with the Federal Patent Court in Munich Germany, requesting the court to revoke the German part of the European patent that is subject to the claim. In November 2011, the regional state court of Manheim Germany, issued an interim decision to the effect that the infringement litigation proceedings be stayed until the Federal Patent Court decides on the concurrent nullity action. At this time we are unable to provide a reasonable estimate of our potential liability or the potential amount of loss related to this action, if any. If the outcome of this litigation is adverse to us, our results and financial condition could be materially affected.

Item 1a Risk Factors

In addition to other information set forth in this report, you should carefully consider the factors discussed in Part 1, Item 1A. “Risk Factors,” in our Annual Report on Form 10-K for the year ended December 31, 2011, which could materially affect our business, financial condition or results of operations. The risks described in our Annual Report on Form 10-K are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or results of operations.

The Company has a significant concentration of business with two customers, Panasonic Avionics Corporation and the US Government, where a significant reduction in sales would negatively impact our sales and earnings. We provide Panasonic with cabin electronics products which, in total were approximately 37% of revenue during the first half of 2012. We provide the US Government with military products which, in total were approximately 8% of revenue during the first half of 2012.

25

Item 2. Unregistered sales of equity securities and use of proceeds

(c) The following table summarizes the Company’s purchases of its common stock for the quarter ended June 30, 2012:

Period	(a) Total number of shares Purchased(1)		(b) Average Price Paid per Share		(c) Total number of shares Purchased as part of Publicly Announced Plans or Programs		(d) Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs
April 1, 2012 – April 28, 2012		2,987		29.92		—		—
April 29, 2012 – May 26, 2012		—		—		—		—
May 27, 2012 – June 30, 2012		—		—		—		—
Total		—		—		—		—

(1) In connection with the exercise of stock options, we accept, from time to time, delivery of shares to pay the exercise price of stock options. During April, we accepted delivery of 2,987 shares at $29.92 in connection with the exercise of stock options.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

None.

Item 5. Other Information

None.

Item 6 Exhibits

Exhibit 31.1	Section 302 Certification - Chief Executive Officer
Exhibit 31.2	Section 302 Certification - Chief Financial Officer
Exhibit 32.	Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Exhibit 101.1*	Instance Document
Exhibit 101.2*	Schema Document
Exhibit 101.3*	Calculation Linkbase Document
Exhibit 101.4*	Labels Linkbase Document
Exhibit 101.5*	Presentation Linkbase Document
Exhibit 101.6*	Definition Linkbase Document

* Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Section 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

26

SIGNATURES

Pursuant to the requirements 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.

	ASTRONICS CORPORATION
	(Registrant)
Date: August 8, 2012	By: /s/ David C. Burney
	David C. Burney Vice President-Finance and Treasurer (Principal Financial Officer)

27

EX-31.1

Exhibit 31.1

SECTION 302 CERTIFICATION

Certification of Chief Executive Officer pursuant to Exchange Act rule 13a-14(a) as adopted pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, Peter J. Gundermann, President and Chief Executive Officer, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Astronics Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 8, 2012

/s/ Peter J. Gundermann

Peter J. Gundermann

President and Chief Executive Officer

28

EX-31.2

Exhibit 31.2

SECTION 302 CERTIFICATION

Certification of Chief Financial Officer pursuant to Exchange Act Rule 13a-14(a) as adopted pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, David C. Burney, Chief Financial Officer, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Astronics Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 8, 2012

/s/ David C. Burney

David C. Burney

Chief Financial Officer

29

EX-32

Exhibit 32

Certification pursuant to

18 U.S.C. Section 1350,

as adopted pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officers of Astronics Corporation (the “Company”) hereby certify that:

The Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2012 fully complies with the requirements of section 13(a) or 15(d) of the Securities and Exchange Act of 1934 and the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: August 8, 2012	/s/ Peter J. Gundermann
	Peter J. Gundermann
	Title: Chief Executive Officer
Dated: August 8, 2012	/s/ David C. Burney
	David C. Burney
	Title: Chief Financial Officer

This certification shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section. This certification shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent specifically incorporated by the Company into such filing.

30

XML

Basis of Presentation (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended		3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jul. 02, 2011	Jun. 30, 2012	Jul. 02, 2011	Jun. 30, 2012 Test Systems Segment [Member]	Jul. 02, 2011 Test Systems Segment [Member]	Jun. 30, 2012 Test Systems Segment [Member]	Jul. 02, 2011 Test Systems Segment [Member]	Nov. 30, 2011 Ballard [Member]	Jul. 30, 2012 Max-viz, Inc [Member]
Basis of Presentation (Textual) [Abstract]
Percentage of acquired stock									100.00%	100.00%
Percentage of Revenue Recognized from Long Term Fixed Price Contracts					39.00%	68.00%	39.00%	83.00%
Basis of Presentation (Additional Textual) [Abstract]
Research and development, design and related engineering	$ 11.1	$ 8.8	$ 21.1	$ 17.1

XML

Comprehensive Income and Accumulated Other Comprehensive Income (Loss) (Details 1) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jul. 02, 2011	Jun. 30, 2012	Jul. 02, 2011
Components of other comprehensive income (loss)
Foreign Currency Translation Adjustments	$ (117)	$ (1)	$ (7)	$ 203
Reclassification to Interest Expense	54	78	114	155
Mark to Market Adjustments for Derivatives	(12)	(98)	(37)	(98)
Tax Expense	(15)	7	(27)	(20)
Mark to Market Adjustment for Derivatives	27	(13)	50	37
Retirement Liability Adjustment	183	34	(5,550)	69
Tax (Expense) Benefit	(43)	(12)	1,963	(24)
Retirement Liability Adjustment	140	22	(3,587)	45
Other Comprehensive (Loss) Income	$ 50	$ 8	$ (3,544)	$ 285

XML

Product Warranties (Details Textual)	6 Months Ended
	Jun. 30, 2012
Product Warranties (Textual) [Abstract]
Product warranty period minimum	12 months
Product warranty period maximum	60 months

XML

Supplemental Retirement Plan and Related Post Retirement Benefits (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jul. 02, 2011	Jun. 30, 2012	Jul. 02, 2011
Net periodic pension cost for defined benefit plans
Service cost	$ 88	$ 12	$ 128	$ 24
Interest cost	147	82	252	164
Amortization of prior service cost	122	27	181	54
Amortization of net actuarial losses	23	3	46	6
Net periodic cost	$ 380	$ 124	$ 607	$ 248

XML

Long-term Debt and Notes Payable (Details) (USD $)	Jun. 30, 2012	Jan. 13, 2012	Dec. 31, 2011	Jun. 30, 2012 Minimum [Member]	Aug. 30, 2011 Minimum [Member]	Jun. 30, 2012 Maximum [Member]	Aug. 30, 2011 Maximum [Member]	Jun. 30, 2012 Credit Agreement [Member] Minimum [Member]	Aug. 30, 2011 Credit Agreement [Member] Minimum [Member]	Jun. 30, 2012 Credit Agreement [Member] Maximum [Member]	Aug. 30, 2011 Credit Agreement [Member] Maximum [Member]	Jun. 30, 2012 Revolving Credit Facility [Member]	Aug. 31, 2011 Revolving Credit Facility [Member]	Aug. 31, 2011 Revolving Credit Facility [Member] Credit Agreement [Member]	Jun. 30, 2012 Term Loan [Member]
Long-term Debt and Notes Payable (Textual) [Abstract]
Term loan principal amount															$ 16,000,000
Revolving credit line	0		0										35,000,000	35,000,000
Letter of credit maturity date												Aug. 31, 2016			Jan. 30, 2014
Credit facility allocated	20,000,000												20,000,000
Interest rate on revolving credit at LIBOR rate					2.75%		4.50%	1.50%		2.50%
Percentage of commitment fee on unused portion of the total credit commitment, minimum				0.25%					0.30%
Percentage of commitment fee on unused portion of the total credit commitment, maximum						0.35%					0.50%
Outstanding letters of credit	11,700,000
Long-term Debt and Notes Payable (Additional Textual) [Abstract]
Revolving credit facility	23,300,000
Outstanding letters of credit	11,700,000
Interest rate on revolving credit line and term loan at LIBOR rate	LIBOR plus between 1.50% and 2.50% based on the Company’s Leverage Ratio
Subordinated promissory note amount		$ 5,000,000
Subordinated promissory note interest rate		6.00%

XML

Comprehensive Income and Accumulated Other Comprehensive Income (Loss) (Tables)

6 Months Ended

Jun. 30, 2012

Comprehensive Income and Accumulated Other Comprehensive Income [Abstract]

Components of accumulated other comprehensive income (loss)

(In thousands)	June 30, 2012			Dec. 31, 2011
Foreign Currency Translation Adjustments	$	1,225		$	1,232
Mark to Market Adjustments for Derivatives – Before Tax		(316	)		(393	)
Tax Benefit		110			137
Mark to Market Adjustments for Derivatives – After Tax		(206	)		(256	)
Retirement Liability Adjustment – Before Tax		(8,415	)		(2,865	)
Tax Benefit		2,966			1,003
Retirement Liability Adjustment – After Tax		(5,449	)		(1,862	)
Accumulated Other Comprehensive Loss	$	(4,430	)	$	(886	)

Components of other comprehensive income (loss)

	Six Months Ended						Three Months Ended
(In thousands)	June 30, 2012			July 2, 2011			June 30, 2012			July 2, 2011
Foreign Currency Translation Adjustments	$	(7	)	$	203		$	(117	)	$	(1	)
Reclassification to Interest Expense		114			155			54			78
Mark to Market Adjustments for Derivatives		(37	)		(98	)		(12	)		(98	)
Tax Expense		(27	)		(20	)		(15	)		7
Mark to Market Adjustments for Derivatives		50			37			27			(13	)
Retirement Liability Adjustment		(5,550	)		69			183			34
Tax (Expense) Benefit		1,963			(24	)		(43	)		(12	)
Retirement Liability Adjustment		(3,587	)		45			140			22
Other Comprehensive (Loss) Income	$	(3,544	)	$	285		$	50		$	8

XML

Supplemental Retirement Plan and Related Post Retirement Benefits (Details Textual) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Mar. 06, 2012
Supplemental Retirement Plan and Related Post Retirement Benefits (Textual) [Abstract]
Projected benefit obligation		$ 5.8
Pension cost	$ 0.8

XML

Basis of Presentation (Policies)

6 Months Ended

Jun. 30, 2012

Basis of Presentation [Abstract]

Operating Results

Operating Results

The results of operations for any interim period are not necessarily indicative of results for the full year. Operating results for the three and six month periods ended June 30, 2012 are not necessarily indicative of the results that may be expected for the year ending December 31, 2012.

The balance sheet at December 31, 2011 has been derived from the audited financial statements at that date, but does not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements.

For further information, refer to the financial statements and footnotes thereto included in Astronics Corporation’s 2011 annual report on Form 10-K.

Description of the Business

Description of the Business

Astronics is a leading supplier of advanced, high-performance lighting systems, electrical power generation and distribution systems, avionics databus solutions, enhanced vision systems, aircraft safety systems for the global aerospace industry as well as test, training and simulation systems primarily for the military. We sell our products to airframe manufacturers (OEMs) in the commercial transport, business jet and military markets as well as FAA/Airport, OEM suppliers and aircraft operators around the world. The Company provides its products through its wholly owned subsidiaries Luminescent Systems, Inc. (“LSI”), Luminescent Systems Canada, Inc. (“LSI Canada”), DME Corporation (“DME”), Ballard Technology, Inc. (“Ballard”), Max-Viz Inc. (“Max-Viz”) and Astronics Advanced Electronic Systems Corp. (“AES”). On November 30, 2011, Astronics acquired 100% of the stock of Ballard. Ballard designs and produces avionics databus solutions for defense and commercial aerospace applications. Ballard is part of our Aerospace segment. On July 30, 2012 Astronics acquired 100% of the stock of Max-Viz, Inc. Max-Viz is a manufacturer of industry‑leading Enhanced Vision Systems for defense and commercial aerospace applications for the purpose of improving situational awareness.

The Company has two reportable segments, Aerospace and Test Systems. The Aerospace segment designs and manufactures products for the global aerospace industry. The Test Systems segment designs, manufactures and maintains communications and weapons test systems and training and simulation devices for military applications.

Principles of Consolidation

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated. Acquisitions are accounted for under the purchase method and, accordingly, the operating results for the acquired companies are included in the consolidated statements of earnings from the respective dates of acquisition.

Revenue and Expense Recognition

Revenue and Expense Recognition

In the Aerospace segment, revenue is recognized on the accrual basis at the time of shipment of goods and transfer of title. There are no significant contracts allowing for right of return.

In the Test Systems segment, revenue of approximately 39% and 68% for the three months ending June 30, 2012 and July 2, 2011 respectively and approximately 39% and 83% for the six months ending June 30, 2012 and July 2, 2011 respectively, is recognized from long-term, fixed-price contracts using the percentage-of-completion method of accounting, measured by multiplying the estimated total contract value by the ratio of actual contract costs incurred to date to the estimated total contract costs. Substantially all long-term contracts are with U.S. government agencies and contractors thereto. The Company makes significant estimates involving its usage of percentage-of-completion accounting to recognize contract revenues. The Company periodically reviews contracts in process for estimates-to-completion, and revises estimated gross profit accordingly. While the Company believes its estimated gross profit on contracts in process is reasonable, unforeseen events and changes in circumstances can take place in a subsequent accounting period that may cause the Company to revise its estimated gross profit on one or more of its contracts in process. Accordingly, the ultimate gross profit realized upon completion of such contracts can vary significantly from estimated amounts between accounting periods. Revenue not recognized using the percentage-of-completion method is recognized at the time of shipment of goods and transfer of title.

Cost of Products Sold, Engineering and Development and Selling, General and Administrative Expenses

Cost of Products Sold, Engineering and Development and Selling, General and Administrative Expenses

Cost of products sold includes the costs to manufacture products such as direct materials and labor and manufacturing overhead as well as all engineering and developmental costs. The Company is engaged in a variety of engineering and design activities as well as basic research and development activities directed to the substantial improvement or new application of the Company’s existing technologies. These costs are expensed when incurred and included in cost of sales. Research and development, design and related engineering amounted to $11.1 million and $8.8 million for the three months ended June 30, 2012 and July, 2, 2011 respectively and $21.1 million and $17.1 million for the six months ended June 30, 2012 and July 2, 2011, respectively. Selling, general and administrative expenses include costs primarily related to our sales and marketing departments and administrative departments. Interest expense is shown net of interest income. Interest income was insignificant for each of the three and six months ended for both June 30, 2012 and July 2, 2011.

Financial Instruments

Financial Instruments

The Company’s financial instruments consist primarily of cash and cash equivalents, accounts receivable, accounts payable, notes payable, long-term debt and interest rate swaps. The Company performs periodic credit evaluations of its customers’ financial condition and generally does not require collateral and the Company does not hold or issue financial instruments for trading purposes. Due to their short-term nature the carrying value of cash and equivalents, accounts receivable, accounts payable, and notes payable, if any, approximate fair value. The carrying value of the Company’s variable rate long-term debt also approximates fair value due to the variable rate feature of these instruments. The Company’s interest rate swaps are recorded at fair value as described under Note 16  ‑ Fair Value and Note 17 ‑ Derivative Financial Instruments.

Derivatives

Derivatives

The accounting for changes in the fair value of derivatives depends on the intended use and resulting designation. The Company’s use of derivative instruments is limited to cash flow hedges for interest rate risk associated with long-term debt. Interest rate swaps are used to adjust the proportion of total debt that is subject to variable and fixed interest rates. The interest rate swaps are designated as hedges of the amount of future cash flows related to interest payments on variable-rate debt that, in combination with the interest payments on the debt, convert a portion of the variable-rate debt to fixed-rate debt. The Company records all derivatives on the balance sheet at fair value as described under Note 16 - Fair Value and Note 17 ‑ Derivative Financial Instruments. The related gains or losses, to the extent the derivatives are effective as a hedge, are deferred in shareholders’ equity as a component of Accumulated Other Comprehensive Income (Loss) (AOCI). Any ineffectiveness is immediately recorded in the statement of operations.

Foreign Currency Translation

Foreign Currency Translation

The Company accounts for its foreign currency translation in accordance with ASC Topic 830, Foreign Currency Translation. The aggregate transaction gain or loss included in operations was insignificant for the periods ending June 30, 2012 and July 2, 2011.

Loss contingencies

Loss contingencies

Loss contingencies may from time to time arise from situations such as warranty claims and other legal actions. Loss contingencies are recorded as liabilities when it is probable that a liability has been incurred and the amount of the loss is reasonably estimable. Disclosure is required when there is a reasonable possibility that the ultimate loss will exceed the recorded provision. Contingent liabilities are often resolved over long time periods. In recording liabilities for probable losses, management is required to make estimates and judgments regarding the amount or range of the probable loss. Management continually assesses the adequacy of estimated loss contingencies and, if necessary, adjusts the amounts recorded as better information becomes known.

Accounting Pronouncements Adopted in 2012

Accounting Pronouncements Adopted in 2012

On January 1, 2012, the Company adopted the new provisions of Accounting Standards Update (“ASU”) No. 2011-05, Comprehensive Income (Topic 220). The amendments in this Update require an entity to report all non-owner changes in stockholders’ equity either in a single continuous statement of comprehensive income or in two separate but consecutive statements. The ASU prohibits the presentation of the components of comprehensive income in the statement of stockholder’s equity. The amendments are effective for annual and interim periods beginning after December 15, 2011 and should be applied retrospectively. In December 2011, the Financial Accounting Standards Board issued ASU No. 2011-12, Comprehensive Income (Topic 220): Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05). The amendments in this Update defer the effective date pertaining only to reclassification adjustments out of accumulated other comprehensive income in Accounting Standards Update 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income, until the Financial Accounting Standards Board is able to reconsider those presentation requirements. Other than requiring an additional statement and disclosures, the impact on the Company’s financial statements was not significant.

On January 1, 2012, the Company adopted the new provisions of ASU No. 2011-04, “Fair Value Measurement (Topic 820) – Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS.” The amendments provide a consistent definition of fair value and ensure that the fair value measurement and disclosure requirements are similar between U.S. GAAP and International Financial Reporting Standards. The amendments also change certain fair value measurement principles and enhance the disclosure requirements, particularly for Level 3 fair value measurements. The amendments are effective during interim and annual periods beginning after December 15, 2011 and should be applied prospectively. Other than requiring additional disclosures, the adoption of this amendment did not have a material impact on our consolidated financial statements.

On January 1, 2012, the Company adopted the new provisions of ASU No. 2011-08, Intangibles - Goodwill and Other (Topic 350). The amendments in this Update will allow an entity to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. Under these amendments, an entity would not be required to calculate the fair value of a reporting unit unless the entity determines, based on a qualitative assessment, that it is more likely than not that its fair value is less than its carrying amount. The amendments are effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011. The adoption of this pronouncement had no impact on the Company’s financial statements.

Income Taxes Policy

ASC Topic 740-10 “Overall - Uncertainty in Income Taxes” (“ASC Topic 740-10”) clarifies the accounting and disclosure for uncertainty in tax positions. ASC Topic 740-10 seeks to reduce the diversity in practice associated with certain aspects of the recognition and measurement related to accounting for income taxes. The Company is subject to the provisions of ASC Topic 740-10 and has analyzed filing positions in all of the federal and state jurisdictions where it is required to file income tax returns, as well as all open tax years in these jurisdictions. Should the Company need to accrue a liability for uncertain tax benefits, any interest associated with that liability will be recorded as interest expense. Penalties, if any, would be recognized as operating expenses. There are no penalties or interest liability accrued as of June 30, 2012 or December 31, 2011, nor are any penalties or interest costs included in expense for the periods ending June 30, 2012 and July 2, 2011. The years under which we conducted our evaluation coincided with the tax years currently still subject to examination by major federal and state tax jurisdictions, those being 2010 through 2011 for federal purposes and 2008 through 2011 for state purposes.

Fair Value Measurement

ASC Topic 820, “Fair value Measurements and Disclosures”, (“ASC Topic 820”) defines fair value, establishes a framework for measuring fair value and expands the related disclosure requirements. This statement applies under other accounting pronouncements that require or permit fair value measurements. The statement indicates, among other things, that a fair value measurement assumes that the transaction to sell an asset or transfer a liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability. ASC Topic 820 defines fair value based upon an exit price model. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and involves consideration of factors specific to the asset or liability.

ASC Topic 820 establishes a valuation hierarchy for disclosure of the inputs to valuation used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows:

Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument.

Level 3 inputs are unobservable inputs based on our own assumptions used to measure assets and liabilities at fair value.

XML

Shareholders' Equity (Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jul. 02, 2011	Jun. 30, 2012	Jul. 02, 2011
Summary of changes in shareholders' equity
Beginning of Period			$ 102,863
Beginning of Period, Shares			9,502,279
Stock Compensation Expense			723	537
Foreign Currency Translation Adjustment	(117)	(1)	(7)	203
Mark to Market Adjustment for Derivatives	27	(13)	50	37
Retirement Liability Adjustment	(140)	(22)	3,587	(45)
Net Income	5,194	4,548	11,289	9,757
End of Period	111,626		111,626
End of Period, shares	9,783,503		9,783,503
Common Class B [Member]
Summary of changes in shareholders' equity
Shares Authorized			5,000,000
Share Par Value			$ 0.01
Beginning of Period, Shares			2,844,434
End of Period, shares	2,612,785		2,612,785
Common Stock [Member]
Summary of changes in shareholders' equity
Shares Authorized			20,000,000
Share Par Value			$ 0.01
Beginning of Period			129
Beginning of Period, Shares			9,680,825
Conversion of Class B Shares to Common Shares			249,793
Exercise of Stock Options Shares			31,431
End of Period	129		129
End of Period, shares	9,962,049		9,962,049
Common Stock [Member] | Common Class B [Member]
Summary of changes in shareholders' equity
Beginning of Period, Shares			3,194,229
Conversion of Class B Shares to Common Shares			(249,793)
Exercise of Stock Options Shares			18,144
End of Period, shares	2,962,580		2,962,580
Additional Paid-in Capital [Member]
Summary of changes in shareholders' equity
Beginning of Period			19,279
Stock Compensation Expense			723
Exercise of Stock Options Value			295
End of Period	20,297		20,297
Accumulated Other Comprehensive Income (Loss) [Member]
Summary of changes in shareholders' equity
Beginning of Period			(886)
Foreign Currency Translation Adjustment			(7)
Mark to Market Adjustment for Derivatives			50
Retirement Liability Adjustment			(3,587)
End of Period	(4,430)		(4,430)
Retained Earnings [Member]
Summary of changes in shareholders' equity
Beginning of Period			86,622
Net Income			11,289
End of Period	97,911		97,911
Treasury Stock [Member]
Summary of changes in shareholders' equity
Beginning of Period			(2,281)
Beginning of Period, Shares			(178,546)
Purchase (disposal) Value
Purchase (disposal) Shares
End of Period	$ (2,281)		$ (2,281)
End of Period, shares	(178,546)		(178,546)
Treasury Stock [Member] | Common Class B [Member]
Summary of changes in shareholders' equity
Beginning of Period, Shares			(349,795)
Purchase (disposal) Shares
End of Period, shares	(349,795)		(349,795)

XML

Intangible Assets (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2012	Dec. 31, 2011
Summary of acquired intangible assets
Gross Carrying Amount	$ 18,386	$ 18,386
Accumulated Amortization	5,039	4,386
Patents [Member]
Summary of acquired intangible assets
Weighted Average Life	12 years
Gross Carrying Amount	1,271	1,271
Accumulated Amortization	735	685
Trade Names [Member]
Summary of acquired intangible assets
Gross Carrying Amount	1,853	1,853
Accumulated Amortization	72	7
Trade Names [Member] | Minimum [Member]
Summary of acquired intangible assets
Weighted Average Life	0 years
Trade Names [Member] | Maximum [Member]
Summary of acquired intangible assets
Weighted Average Life	10 years
Completed and Unpatented Technology [Member]
Summary of acquired intangible assets
Gross Carrying Amount	5,277	5,277
Accumulated Amortization	1,472	1,242
Completed and Unpatented Technology [Member] | Minimum [Member]
Summary of acquired intangible assets
Weighted Average Life	10 years
Completed and Unpatented Technology [Member] | Maximum [Member]
Summary of acquired intangible assets
Weighted Average Life	15 years
Backlog and Customer Relationships [Member]
Summary of acquired intangible assets
Gross Carrying Amount	9,985	9,985
Accumulated Amortization	$ 2,760	$ 2,452
Backlog and Customer Relationships [Member] | Minimum [Member]
Summary of acquired intangible assets
Weighted Average Life	3 years
Backlog and Customer Relationships [Member] | Maximum [Member]
Summary of acquired intangible assets
Weighted Average Life	20 years

XML

Fair Value (Tables)

6 Months Ended

Jun. 30, 2012

Fair Value [Abstract]

Financial assets and liabilities carried at fair value measured on a recurring basis

(In thousands)	Classification	Total			Level 1		Level 2			Level 3
Interest rate swaps	Other Liabilities
June 30, 2012		$	(316	)	$	—	$	(316	)	$	—
December 31, 2011			(393	)		—		(393	)		—
Acquisition contingent consideration	Other Liabilities
June 30, 2012		$	(741	)	$	—	$	—		$	(741	)
December 31, 2011			(720	)		—		—			(720	)

XML

Earnings Per Share (Details Textual)	Aug. 30, 2011	Aug. 02, 2011
Earnings Per Share (Textual) [Abstract]
Distribution of Class B Stock to holders of both Common and Class B Stock		one-for-ten
Number of Class B Stock received for every ten shares of Common and Class B Stock held	1
Record date	Aug. 16, 2011

XML

Segment Information (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jul. 02, 2011	Jun. 30, 2012	Jul. 02, 2011	Dec. 31, 2011
Summary of segment reporting information
Sales	$ 64,989	$ 55,475	$ 130,127	$ 110,603
Operating Profit (Loss) and Margins	9,585	8,466	20,388	17,802
Percentage of Operating Profit (Loss) and Margins	14.70%	15.30%	15.70%	16.10%
Deductions from Operating Profit
Interest Expense	266	534	529	1,071
Corporate Expenses and Other	1,809	1,224	3,347	2,399
Income Before Income Taxes	7,510	6,708	16,512	14,332
Total Assets	187,572		187,572		174,905
Aerospace [Member]
Summary of segment reporting information
Sales	62,423	51,942	124,424	102,141
Operating Profit (Loss) and Margins	10,903	9,011	22,781	18,330
Percentage of Operating Profit (Loss) and Margins	17.50%	17.30%	18.30%	17.90%
Deductions from Operating Profit
Total Assets	152,736		152,736		136,930
Test Systems [Member]
Summary of segment reporting information
Sales	2,566	3,533	5,703	8,462
Operating Profit (Loss) and Margins	(1,318)	(545)	(2,393)	(528)
Percentage of Operating Profit (Loss) and Margins	(51.40%)	(15.40%)	(42.00%)	(6.20%)
Deductions from Operating Profit
Total Assets	18,133		18,133		20,020
Corporate [Member]
Deductions from Operating Profit
Total Assets	$ 16,703		$ 16,703		$ 17,955

XML

Product Warranties (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jul. 02, 2011	Jun. 30, 2012	Jul. 02, 2011
Summary of activity in the warranty accrual
Beginning balance	$ 1,448	$ 1,657	$ 1,092	$ 1,699
Warranties issued	246	448	772	987
Warranties settled	(303)	(408)	(473)	(953)
Reassessed warranty exposure		(307)		(343)
Ending balance	$ 1,391	$ 1,390	$ 1,391	$ 1,390

XML

Intangible Assets

6 Months Ended

Jun. 30, 2012

Intangible Assets/Goodwill [Abstract]

Intangible Assets

4) Intangible Assets

The following table summarizes acquired intangible assets as follows:

		June 30, 2012				December 31, 2011
(In thousands)	Weighted Average Life	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Patents	12 Years	$	1,271	$	735	$	1,271	$	685
Trade Names	0 - 10 Years		1,853		72		1,853		7
Completed and Unpatented Technology	10 - 15 Years		5,277		1,472		5,277		1,242
Backlog and Customer Relationships	3 - 20 Years		9,985		2,760		9,985		2,452
Total Intangible Assets		$	18,386	$	5,039	$	18,386	$	4,386

All acquired intangible assets other than goodwill and one trade name are being amortized. Amortization expense for acquired intangibles is summarized as follows:

	Six Months Ended				Three Months Ended
(In thousands)	June 30, 2012		July 2, 2011		June 30, 2012		July 2, 2011
Amortization Expense	$	653	$	217	$	304	$	103

Amortization expense for intangible assets for each of the next five years is summarized as follows:

(In thousands)
2012	$	1,261
2013		1,215
2014		1,215
2015		1,170
2016		1,166

XML

Fair Value (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Financial assets and liabilities carried at fair value measured on a recurring basis
Interest rate swaps	$ (316)	$ (393)
Acquisition contingent consideration	(741)	(720)
Level 1 [Member]
Financial assets and liabilities carried at fair value measured on a recurring basis
Interest rate swaps
Acquisition contingent consideration
Level 2 [Member]
Financial assets and liabilities carried at fair value measured on a recurring basis
Interest rate swaps	(316)	(393)
Acquisition contingent consideration
Level 3 [Member]
Financial assets and liabilities carried at fair value measured on a recurring basis
Interest rate swaps
Acquisition contingent consideration	$ (741)	$ (720)

XML

Intangible Assets (Details 1) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jul. 02, 2011	Jun. 30, 2012	Jul. 02, 2011
Summary of amortization expense for acquired intangibles
Amortization Expense	$ 304	$ 103	$ 653	$ 217

XML

Goodwill (Tables)

6 Months Ended

Jun. 30, 2012

Intangible Assets/Goodwill [Abstract]

Summary of changes in the carrying amount of goodwill

(In thousands)	December 31, 2011		Foreign Currency Translation		June 30, 2012
Aerospace Segment	$	17,185	$	—	$	17,185

XML

Intangible Assets (Tables)

6 Months Ended

Jun. 30, 2012

Intangible Assets/Goodwill [Abstract]

Summary of acquired intangible assets

		June 30, 2012				December 31, 2011
(In thousands)	Weighted Average Life	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Patents	12 Years	$	1,271	$	735	$	1,271	$	685
Trade Names	0 - 10 Years		1,853		72		1,853		7
Completed and Unpatented Technology	10 - 15 Years		5,277		1,472		5,277		1,242
Backlog and Customer Relationships	3 - 20 Years		9,985		2,760		9,985		2,452
Total Intangible Assets		$	18,386	$	5,039	$	18,386	$	4,386

Summary of amortization expense for acquired intangibles

	Six Months Ended				Three Months Ended
(In thousands)	June 30, 2012		July 2, 2011		June 30, 2012		July 2, 2011
Amortization Expense	$	653	$	217	$	304	$	103

Summary of Amortization expense for intangible assets for each of the next five years

(In thousands)
2012	$	1,261
2013		1,215
2014		1,215
2015		1,170
2016		1,166

XML

Supplemental Retirement Plan and Related Post Retirement Benefits (Details 1) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jul. 02, 2011	Jun. 30, 2012	Jul. 02, 2011
Net periodic cost recognized for defined benefit plans
Service cost	$ 88	$ 12	$ 128	$ 24
Interest cost	147	82	252	164
Amortization of prior service cost	122	27	181	54
Amortization of net actuarial gains	23	3	46	6
Net periodic cost	380	124	607	248
SERP [Member]
Net periodic cost recognized for defined benefit plans
Service cost			1
Interest cost	6	7	12	14
Amortization of prior service cost	7	6	13	12
Amortization of net actuarial gains		(1)		(2)
Net periodic cost	$ 13	$ 12	$ 26	$ 24

XML

Intangible Assets (Details 2) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012
Summary of Amortization expense for intangible assets for each of the next five years
2012	$ 1,261
2013	1,215
2014	1,215
2015	1,170
2016	$ 1,166

XML

Product Warranties (Tables)

6 Months Ended

Jun. 30, 2012

Product Warranties [Abstract]

Summary of activity in the warranty accrual

	Six months ended						Three Months Ended
(In thousands)	June 30, 2012			July 2, 2011			June 30, 2012			July 2, 2011
Balance at beginning of period	$	1,092		$	1,699		$	1,448		$	1,657
Warranties issued		772			987			246			448
Warranties settled		(473	)		(953	)		(303	)		(408	)
Reassessed warranty exposure		—			(343	)		—			(307	)
Balance at end of period	$	1,391		$	1,390		$	1,391		$	1,390

XML

Shareholders' Equity (Tables)

6 Months Ended

Jun. 30, 2012

Shareholders' Equity [Abstract]

Summary of changes in shareholders' equity

				Number of Shares
	Amount			Common Stock			Convertible Class B Stock
Shares Authorized					20,000,000			5,000,000
Share Par Value				$	0.01		$	0.01
(Dollars in thousands)
COMMON STOCK
Beginning of Period	$	129			9,680,825			3,194,229
Conversion of Class B Shares to Common Shares		—			249,793			(249,793	)
Exercise of Stock Options		—			31,431			18,144
End of Period	$	129			9,962,049			2,962,580
ADDITIONAL PAID IN CAPITAL
Beginning of Period	$	19,279
Stock Compensation Expense		723
Exercise of Stock Options		295
End of Period	$	20,297
ACCUMULATED OTHER COMPREHENSIVE LOSS
Beginning of Period	$	(886	)
Foreign Currency Translation Adjustment		(7	)
Mark to Market Adjustment for Derivatives		50
Retirement Liability Adjustment		(3,587	)
End of Period	$	(4,430	)
RETAINED EARNINGS
Beginning of Period	$	86,622
Net Income		11,289
End of Period	$	97,911
TREASURY STOCK
Beginning of Period	$	(2,281	)		(178,546	)		(349,795	)
Purchase (disposal)		—			—			—
End of Period	$	(2,281	)		(178,546	)		(349,795	)
TOTAL SHAREHOLDERS’ EQUITY
Beginning of Period	$	102,863			9,502,279			2,844,434
End of Period	$	111,626			9,783,503			2,612,785

XML

Property, Plant and Equipment

6 Months Ended

Jun. 30, 2012

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

3) Property, Plant and Equipment

The following table summarizes Property, Plant and Equipment as follows:

(In thousands)	June 30, 2012		December 31, 2011
Land	$	2,819	$	2,819
Buildings and Improvements		22,774		22,760
Machinery and Equipment		39,209		37,289
Construction in Progress		10,239		7,702
		75,041		70,570
Less Accumulated Depreciation		31,479		29,448
	$	43,562	$	41,122

XML

Earnings Per Share (Tables)

6 Months Ended

Jun. 30, 2012

Earnings Per Share [Abstract]

Summary of basic and diluted weighted-average shares outstanding

	Six Months Ended				Three Months Ended
(In thousands)	June 30, 2012		July 2, 2011		June 30, 2012		July 2, 2011
Basic earnings per share weighted average shares		12,374		12,093		12,390		12,107
Net effect of dilutive stock options		764		739		772		766
Diluted earnings per share weighted average shares		13,138		12,832		13,162		12,873

XML

Inventories (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Summary of Inventories
Finished Goods	$ 10,546	$ 7,420
Work in Progress	8,089	8,477
Raw Material	25,937	24,197
Inventory, Net	$ 44,572	$ 40,094

XML

Comprehensive Income and Accumulated Other Comprehensive Income (Loss) (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Components of accumulated other comprehensive income (loss)
Foreign Currency Translation Adjustments	$ 1,225	$ 1,232
Mark to Market Adjustments for Derivatives - Before Tax	(316)	(393)
Tax Benefit	110	137
Mark to Market Adjustments for Derivatives - After Tax	(206)	(256)
Retirement Liability Adjustment - Before Tax	(8,415)	(2,865)
Tax Benefit	2,966	1,003
Retirement Liability Adjustment - After Tax	(5,449)	(1,862)
Accumulated Other Comprehensive Loss	$ (4,430)	$ (886)

XML

Consolidated Condensed Balance Sheets (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Current Assets:
Cash and Cash Equivalents	$ 8,168	$ 10,919
Accounts Receivable, net of allowance for doubtful accounts	43,536	35,669
Inventories	44,572	40,094
Other Current Assets	5,567	5,628
Total Current Assets	101,843	92,310
Property, Plant and Equipment, net of accumulated depreciation	43,562	41,122
Deferred Income Taxes	8,886	7,039
Other Assets	2,749	3,249
Intangible Assets, net of accumulated amortization	13,347	14,000
Goodwill	17,185	17,185
Total Assets	187,572	174,905
Current Liabilities:
Current Maturities of Long-term Debt	5,273	5,290
Accounts Payable	11,164	10,559
Accrued Expenses	11,692	11,568
Accrued Income Taxes	340
Billings in Excess of Recoverable Costs and Accrued Profits on Uncompleted Contracts		264
Customer Advance Payments and Deferred Revenue	10,556	5,796
Total Current Liabilities	39,025	33,477
Long-term Debt	20,484	27,973
Other Liabilities	16,437	10,592
Total Liabilities	75,946	72,042
Shareholders' Equity:
Common Stock	129	129
Other Shareholders' Equity	111,497	102,734
Total Shareholders' Equity	111,626	102,863
Total Liabilities and Shareholders' Equity	$ 187,572	$ 174,905

XML

Goodwill (Details) (USD $) In Thousands, unless otherwise specified			6 Months Ended
	Jun. 30, 2012	Dec. 31, 2011	Jun. 30, 2012 Aerospace Segment [Member]
Summary of changes in the carrying amount of goodwill
Beginning balance	$ 17,185	$ 17,185	$ 17,185
Foreign Currency Translation
Ending balance	$ 17,185	$ 17,185	$ 17,185

XML

Basis of Presentation

6 Months Ended

Jun. 30, 2012

Basis of Presentation [Abstract]

Basis of Presentation

1) Basis of Presentation

The accompanying unaudited statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information. Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments, consisting of normal recurring accruals, considered necessary for a fair presentation have been included.

Operating Results

The results of operations for any interim period are not necessarily indicative of results for the full year. Operating results for the three and six month periods ended June 30, 2012 are not necessarily indicative of the results that may be expected for the year ending December 31, 2012.

The balance sheet at December 31, 2011 has been derived from the audited financial statements at that date, but does not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements.

For further information, refer to the financial statements and footnotes thereto included in Astronics Corporation’s 2011 annual report on Form 10-K.

Description of the Business

Astronics is a leading supplier of advanced, high-performance lighting systems, electrical power generation and distribution systems, avionics databus solutions, enhanced vision systems, aircraft safety systems for the global aerospace industry as well as test, training and simulation systems primarily for the military. We sell our products to airframe manufacturers (OEMs) in the commercial transport, business jet and military markets as well as FAA/Airport, OEM suppliers and aircraft operators around the world. The Company provides its products through its wholly owned subsidiaries Luminescent Systems, Inc. (“LSI”), Luminescent Systems Canada, Inc. (“LSI Canada”), DME Corporation (“DME”), Ballard Technology, Inc. (“Ballard”), Max-Viz Inc. (“Max-Viz”) and Astronics Advanced Electronic Systems Corp. (“AES”). On November 30, 2011, Astronics acquired 100% of the stock of Ballard. Ballard designs and produces avionics databus solutions for defense and commercial aerospace applications. Ballard is part of our Aerospace segment. On July 30, 2012 Astronics acquired 100% of the stock of Max-Viz, Inc. Max-Viz is a manufacturer of industry‑leading Enhanced Vision Systems for defense and commercial aerospace applications for the purpose of improving situational awareness.

The Company has two reportable segments, Aerospace and Test Systems. The Aerospace segment designs and manufactures products for the global aerospace industry. The Test Systems segment designs, manufactures and maintains communications and weapons test systems and training and simulation devices for military applications.

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated. Acquisitions are accounted for under the purchase method and, accordingly, the operating results for the acquired companies are included in the consolidated statements of earnings from the respective dates of acquisition.

Revenue and Expense Recognition

In the Aerospace segment, revenue is recognized on the accrual basis at the time of shipment of goods and transfer of title. There are no significant contracts allowing for right of return.

In the Test Systems segment, revenue of approximately 39% and 68% for the three months ending June 30, 2012 and July 2, 2011 respectively and approximately 39% and 83% for the six months ending June 30, 2012 and July 2, 2011 respectively, is recognized from long-term, fixed-price contracts using the percentage-of-completion method of accounting, measured by multiplying the estimated total contract value by the ratio of actual contract costs incurred to date to the estimated total contract costs. Substantially all long-term contracts are with U.S. government agencies and contractors thereto. The Company makes significant estimates involving its usage of percentage-of-completion accounting to recognize contract revenues. The Company periodically reviews contracts in process for estimates-to-completion, and revises estimated gross profit accordingly. While the Company believes its estimated gross profit on contracts in process is reasonable, unforeseen events and changes in circumstances can take place in a subsequent accounting period that may cause the Company to revise its estimated gross profit on one or more of its contracts in process. Accordingly, the ultimate gross profit realized upon completion of such contracts can vary significantly from estimated amounts between accounting periods. Revenue not recognized using the percentage-of-completion method is recognized at the time of shipment of goods and transfer of title.

Cost of Products Sold, Engineering and Development and Selling, General and Administrative Expenses

Cost of products sold includes the costs to manufacture products such as direct materials and labor and manufacturing overhead as well as all engineering and developmental costs. The Company is engaged in a variety of engineering and design activities as well as basic research and development activities directed to the substantial improvement or new application of the Company’s existing technologies. These costs are expensed when incurred and included in cost of sales. Research and development, design and related engineering amounted to $11.1 million and $8.8 million for the three months ended June 30, 2012 and July, 2, 2011 respectively and $21.1 million and $17.1 million for the six months ended June 30, 2012 and July 2, 2011, respectively. Selling, general and administrative expenses include costs primarily related to our sales and marketing departments and administrative departments. Interest expense is shown net of interest income. Interest income was insignificant for each of the three and six months ended for both June 30, 2012 and July 2, 2011.

Financial Instruments

The Company’s financial instruments consist primarily of cash and cash equivalents, accounts receivable, accounts payable, notes payable, long-term debt and interest rate swaps. The Company performs periodic credit evaluations of its customers’ financial condition and generally does not require collateral and the Company does not hold or issue financial instruments for trading purposes. Due to their short-term nature the carrying value of cash and equivalents, accounts receivable, accounts payable, and notes payable, if any, approximate fair value. The carrying value of the Company’s variable rate long-term debt also approximates fair value due to the variable rate feature of these instruments. The Company’s interest rate swaps are recorded at fair value as described under Note 16  ‑ Fair Value and Note 17 ‑ Derivative Financial Instruments.

Derivatives

The accounting for changes in the fair value of derivatives depends on the intended use and resulting designation. The Company’s use of derivative instruments is limited to cash flow hedges for interest rate risk associated with long-term debt. Interest rate swaps are used to adjust the proportion of total debt that is subject to variable and fixed interest rates. The interest rate swaps are designated as hedges of the amount of future cash flows related to interest payments on variable-rate debt that, in combination with the interest payments on the debt, convert a portion of the variable-rate debt to fixed-rate debt. The Company records all derivatives on the balance sheet at fair value as described under Note 16 - Fair Value and Note 17 ‑ Derivative Financial Instruments. The related gains or losses, to the extent the derivatives are effective as a hedge, are deferred in shareholders’ equity as a component of Accumulated Other Comprehensive Income (Loss) (AOCI). Any ineffectiveness is immediately recorded in the statement of operations.

Foreign Currency Translation

The Company accounts for its foreign currency translation in accordance with ASC Topic 830, Foreign Currency Translation. The aggregate transaction gain or loss included in operations was insignificant for the periods ending June 30, 2012 and July 2, 2011.

Loss contingencies

Loss contingencies may from time to time arise from situations such as warranty claims and other legal actions. Loss contingencies are recorded as liabilities when it is probable that a liability has been incurred and the amount of the loss is reasonably estimable. Disclosure is required when there is a reasonable possibility that the ultimate loss will exceed the recorded provision. Contingent liabilities are often resolved over long time periods. In recording liabilities for probable losses, management is required to make estimates and judgments regarding the amount or range of the probable loss. Management continually assesses the adequacy of estimated loss contingencies and, if necessary, adjusts the amounts recorded as better information becomes known.

Accounting Pronouncements Adopted in 2012

On January 1, 2012, the Company adopted the new provisions of Accounting Standards Update (“ASU”) No. 2011-05, Comprehensive Income (Topic 220). The amendments in this Update require an entity to report all non-owner changes in stockholders’ equity either in a single continuous statement of comprehensive income or in two separate but consecutive statements. The ASU prohibits the presentation of the components of comprehensive income in the statement of stockholder’s equity. The amendments are effective for annual and interim periods beginning after December 15, 2011 and should be applied retrospectively. In December 2011, the Financial Accounting Standards Board issued ASU No. 2011-12, Comprehensive Income (Topic 220): Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05). The amendments in this Update defer the effective date pertaining only to reclassification adjustments out of accumulated other comprehensive income in Accounting Standards Update 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income, until the Financial Accounting Standards Board is able to reconsider those presentation requirements. Other than requiring an additional statement and disclosures, the impact on the Company’s financial statements was not significant.

On January 1, 2012, the Company adopted the new provisions of ASU No. 2011-04, “Fair Value Measurement (Topic 820) – Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS.” The amendments provide a consistent definition of fair value and ensure that the fair value measurement and disclosure requirements are similar between U.S. GAAP and International Financial Reporting Standards. The amendments also change certain fair value measurement principles and enhance the disclosure requirements, particularly for Level 3 fair value measurements. The amendments are effective during interim and annual periods beginning after December 15, 2011 and should be applied prospectively. Other than requiring additional disclosures, the adoption of this amendment did not have a material impact on our consolidated financial statements.

On January 1, 2012, the Company adopted the new provisions of ASU No. 2011-08, Intangibles - Goodwill and Other (Topic 350). The amendments in this Update will allow an entity to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. Under these amendments, an entity would not be required to calculate the fair value of a reporting unit unless the entity determines, based on a qualitative assessment, that it is more likely than not that its fair value is less than its carrying amount. The amendments are effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011. The adoption of this pronouncement had no impact on the Company’s financial statements.

XML

Sales to Major Customers (Details Textual)	6 Months Ended
	Jun. 30, 2012 Customer
Sales to Major Customers (Textual) [Abstract]
Number of major customers	2

XML

Sales to Major Customers (Tables)

6 Months Ended

Jun. 30, 2012

Sales to Major Customers [Abstract]

Information relating to the activity with customers

	Six Months Ended						Three Months Ended
	June 30, 2012			July 2, 2011			June 30, 2012			July 2, 2011
Percent of consolidated revenue
Panasonic		37	%		34	%		32	%		31	%
U.S. Government		8	%		10	%		7	%		8	%

(In thousands)	June 30, 2012		Dec. 31, 2011
Accounts Receivable
Panasonic	$	12,872	$	9,878
U.S. Government		2,776		3,866

XML

Derivative Financial Instruments (Details Textual) (USD $)	Jun. 30, 2012	Dec. 31, 2011
Derivative Financial Instruments (Textual) [Abstract]
Fair value of interest rate derivative liabilities	$ (316,000)	$ (393,000)
Amounts expected to be reclassified to earnings in the next 12 months	100,000
Industrial Revenue Bond [Member]
Derivative Financial Instruments (Textual) [Abstract]
Notional amount of interest rate swap	2,200,000
Industrial Revenue [Member]
Derivative Financial Instruments (Textual) [Abstract]
Interest of interest rate swap	3.99%
Derivative, variable rate basis	3.99% plus a spread based on the Company’s leverage ratio
Term Note [Member]
Derivative Financial Instruments (Textual) [Abstract]
Notional amount of interest rate swap	7,000,000
Interest of interest rate swap	2.115%
Derivative, variable rate basis	2.115% plus a spread based on the Company’s leverage ratio
Interest Rate Swap 1 [Member]
Derivative Financial Instruments (Textual) [Abstract]
Derivative, date inception	Feb. 06, 2006
Derivative, date maturity	Feb. 01, 2016
Interest Rate Swap [Member]
Derivative Financial Instruments (Textual) [Abstract]
Derivative, date inception	Oct. 01, 2009
Derivative, date maturity	Jan. 30, 2014
Fair value of interest rate derivative liabilities	$ 300,000	$ 400,000

XML

Derivative Financial Instruments

6 Months Ended

Jun. 30, 2012

Derivative Financial Instruments [Abstract]

Derivative Financial Instruments

17) Derivative Financial Instruments

At June 30, 2012, we had interest rate swaps consisting of the following:

a) An interest rate swap with a notional amount of approximately $2.2 million at June 30, 2012, entered into on February 6, 2006, related to the Company’s Series 1999 New York Industrial Revenue Bond which effectively fixes the rate at 3.99% plus a spread based on the Company’s leverage ratio on this obligation through February 1, 2016.

b) An interest rate swap with a notional amount of $7.0 million at June 30, 2012, entered into on March 19, 2009 related to the Company’s term note issued January 30, 2009. The swap effectively fixes the rate at 2.115% plus a spread based on the Company’s leverage ratio on the notional amount (which decreases in concert with the scheduled note repayment schedule). The swap agreement became effective October 1, 2009 and expires January 30, 2014.

At June 30, 2012 and December 31, 2011, the fair value of interest rate swaps was a liability of $0.3 million and $0.4 million respectively, which is included in other long-term liabilities (See Note 16). Amounts expected to be reclassified to earnings in the next 12 months is approximately $0.1 million.

To the extent the interest rate swaps are not perfectly effective in offsetting the change in the value of the payments being hedged; the ineffective portion of these contracts is recognized in earnings immediately as interest expense. Ineffectiveness, if any, was not significant for the three and six months ended June 30, 2012 and July 2, 2011, respectively. The Company classifies the cash flows from hedging transactions in the same category as the cash flows from the respective hedged items. Amounts from ineffectiveness, if any, to be reclassified during 2012 are not expected to be significant.

Activity in accumulated other comprehensive income (“AOCI”) related to these derivatives is summarized below:

	Six Months Ended						Three Months Ended
(In thousands)	June 30, 2012			July 2, 2011			June 30, 2012			July 2, 2011
Derivative balance at the beginning of the period in AOCI	$	(256	)	$	(338	)	$	(233	)	$	(288	)
Net deferral in AOCI of derivatives:
Net (increase) decrease in fair value of derivatives		(37	)		(98	)		(12	)		(98	)
Tax effect		14			35			4			35
		(23	)		(63	)		(8	)		(63	)
Net reclassification from AOCI into earnings:
Reclassification from AOCI into earnings – Interest expense		114			155			54			78
Tax effect		(41	)		(55	)		(19	)		(28	)
		73			100			35			50
Net change in derivatives for the period		50			37			27			(13	)
Derivative balance at the end of the period in AOCI	$	(206	)	$	(301	)	$	(206	)	$	(301	)

XML

Segment Information (Tables)

6 Months Ended

Jun. 30, 2012

Segment Information [Abstract]

Summary of segment reporting information

	Six Months Ended						Three Months Ended
(Dollars in thousands)	June 30, 2012			July 2, 2011			June 30, 2012			July 2, 2011
Sales
Aerospace	$	124,424		$	102,141		$	62,423		$	51,942
Test Systems		5,703			8,462			2,566			3,533
Sales	$	130,127		$	110,603		$	64,989		$	55,475
Operating Profit (Loss) and Margins
Aerospace	$	22,781		$	18,330		$	10,903		$	9,011
		18.3	%		17.9	%		17.5	%		17.3	%
Test Systems		(2,393	)		(528	)		(1,318	)		(545	)
		(42.0	)%		(6.2	)%		(51.4	)%		(15.4	)%
Total Operating Profit		20,388			17,802			9,585			8,466
		15.7	%		16.1	%		14.7	%		15.3	%
Deductions from Operating Profit
Interest Expense		529			1,071			266			534
Corporate Expenses and Other		3,347			2,399			1,809			1,224
Income Before Income Taxes	$	16,512		$	14,332		$	7,510		$	6,708

(In thousands)	June 30, 2012		Dec. 31, 2011
Aerospace	$	152,736	$	136,930
Test Systems		18,133		20,020
Corporate		16,703		17,955
Total Assets	$	187,572	$	174,905

XML

Subsequent Events

6 Months Ended

Jun. 30, 2012

Subsequent Events [Abstract]

Subsequent Events

19) Subsequent Events

On July 30, 2012 we acquired 100% of the stock of Max-Viz, Inc. (“Max-Viz”) a manufacturer of industry-leading Enhanced Vision Systems for defense and commercial aerospace applications for the purpose of improving situational awareness. Max-Viz will be included in our aerospace reporting segment. The addition of Max-Viz diversifies the products and technologies that Astronics offers. We purchased the outstanding stock of Max-Viz for $10.0 million in cash plus contingent purchase consideration up to a maximum of $8.0 million subject to meeting certain revenue growth targets over the next three years. The additional contingent purchase consideration will be recorded at its estimated fair value at the date of acquisition based upon the Company’s assessment of the probability of Max-Viz achieving the revenue growth targets.

The allocation of the purchase price paid for Max-Viz will be based on fair values of the acquired assets and liabilities assumed of Max-Viz as of July 30, 2012. Max-Viz’s unaudited 2011 revenue was approximately $5.4 million.

XML

Inventories

6 Months Ended

Jun. 30, 2012

Inventories [Abstract]

Inventories

2) Inventories

Inventories are stated at the lower of cost or market, cost being determined in accordance with the first-in, first-out method. Inventories are as follows:

(In thousands)	June 30, 2012		December 31, 2011
Finished Goods	$	10,546	$	7,420
Work in Progress		8,089		8,477
Raw Material		25,937		24,197
	$	44,572	$	40,094

The Company records valuation reserves to provide for excess, slow moving or obsolete inventory or to reduce inventory to the lower of cost or market value. In determining the appropriate reserve, the Company considers the age of inventory on hand, the overall inventory levels in relation to forecasted demands as well as reserving for specifically identified inventory that the Company believes is no longer salable.

XML

Consolidated Condensed Statements of Operations (Unaudited) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jul. 02, 2011	Jun. 30, 2012	Jul. 02, 2011
Consolidated Condensed Statements of Operations [Abstract]
Sales	$ 64,989	$ 55,475	$ 130,127	$ 110,603
Cost of Products Sold	47,935	41,089	94,953	81,711
Gross Profit	17,054	14,386	35,174	28,892
Selling, General and Administrative Expenses	9,278	7,144	18,133	13,489
Income from Operations	7,776	7,242	17,041	15,403
Interest Expense, net of interest income	266	534	529	1,071
Income Before Income Taxes	7,510	6,708	16,512	14,332
Provision for Income Taxes	2,316	2,160	5,223	4,575
Net Income	$ 5,194	$ 4,548	$ 11,289	$ 9,757
Earnings per share:
Basic	$ 0.42	$ 0.37	$ 0.91	$ 0.81
Diluted	$ 0.39	$ 0.35	$ 0.86	$ 0.76

XML

Supplemental Retirement Plan and Related Post Retirement Benefits

6 Months Ended

Jun. 30, 2012

Supplemental Retirement Plan and Related Post Retirement Benefits [Abstract]

Supplemental Retirement Plan and Related Post Retirement Benefits

12) Supplemental Retirement Plan and Related Post Retirement Benefits

The Company has two non-qualified supplemental retirement defined benefit plans (“SERP” and “SERP II”) for certain executive officers. The following table sets forth information regarding the net periodic pension cost for the plans.

	Six Months Ended				Three Months Ended
(In thousands)	June 30, 2012		July 2, 2011		June 30, 2012		July 2, 2011
Service cost	$	128	$	24	$	88	$	12
Interest cost		252		164		147		82
Amortization of prior service cost		181		54		122		27
Amortization of net actuarial losses		46		6		23		3
Net periodic cost	$	607	$	248	$	380	$	124

Participants in the SERP are entitled to paid medical, dental and long-term care insurance benefits upon retirement under the plan. The following table sets forth information regarding the net periodic cost recognized for those benefits:

	Six Months Ended					Three Months Ended
(In thousands)	June 30, 2012		July 2, 2011			June 30, 2012		July 2, 2011
Service cost	$	1	$	—		$	—	$	—
Interest cost		12		14			6		7
Amortization of prior service cost		13		12			7		6
Amortization of net actuarial gains		—		(2	)		—		(1	)
Net periodic cost	$	26	$	24		$	13	$	12

On March 6, 2012 the Company adopted a second non-qualified supplemental retirement defined benefit plan (“SERP II”) for eligible executive officers. The Company recorded a liability at the date of adoption of $5.8 million for the projected benefit obligation. Pension cost of the new plan for the year ending December 31, 2012 is estimated to be approximately $0.8 million. The plan is unfunded and the Company does not expect to make and contributions to the plan, nor does it expect any benefits will be paid from the plan in 2012.

XML

Document and Entity Information	6 Months Ended
	Jun. 30, 2012
Entity Registrant Name	ASTRONICS CORP
Entity Central Index Key	0000008063
Document Type	10-Q
Document Period End Date	Jun. 30, 2012
Amendment Flag	false
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q2
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding	12,396,288
Common Stock
Entity Common Stock, Shares Outstanding	9,783,503
Common Class B
Entity Common Stock, Shares Outstanding	2,612,785

XML

Sales to Major Customers

6 Months Ended

Jun. 30, 2012

Sales to Major Customers [Abstract]

Sales to Major Customers

13) Sales to Major Customers

The Company has a significant concentration of business with two major customers, Panasonic Aviation Corporation and various departments of the U.S. Government, primarily branches of the Department of Defense and the Federal Aviation Administration. The following is information relating to the activity with those customers:

	Six Months Ended						Three Months Ended
	June 30, 2012			July 2, 2011			June 30, 2012			July 2, 2011
Percent of consolidated revenue
Panasonic		37	%		34	%		32	%		31	%
U.S. Government		8	%		10	%		7	%		8	%

(In thousands)	June 30, 2012		Dec. 31, 2011
Accounts Receivable
Panasonic	$	12,872	$	9,878
U.S. Government		2,776		3,866

XML

Consolidated Condensed Statements of Comprehensive Income (Unaudited) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jul. 02, 2011	Jun. 30, 2012	Jul. 02, 2011
Consolidated Condensed Statements of Comprehensive Income [Abstract]
Net Income	$ 5,194	$ 4,548	$ 11,289	$ 9,757
Other Comprehensive Income:
Foreign Currency Translation Adjustments	(117)	(1)	(7)	203
Mark to Market Adjustments for Derivatives - Net of Tax	27	(13)	50	37
Retirement Liability Adjustment - Net of Tax	140	22	(3,587)	45
Other Comprehensive (Loss) Income	50	8	(3,544)	285
Comprehensive Income	$ 5,244	$ 4,556	$ 7,745	$ 10,042

XML

Product Warranties

6 Months Ended

Jun. 30, 2012

Product Warranties [Abstract]

Product Warranties

7) Product Warranties

In the ordinary course of business, the Company warrants its products against defects in design, materials and workmanship typically over periods ranging from twelve to sixty months. The Company determines warranty reserves needed by product line based on experience and current facts and circumstances. Activity in the warranty accrual is summarized as follows:

	Six months ended						Three Months Ended
(In thousands)	June 30, 2012			July 2, 2011			June 30, 2012			July 2, 2011
Balance at beginning of period	$	1,092		$	1,699		$	1,448		$	1,657
Warranties issued		772			987			246			448
Warranties settled		(473	)		(953	)		(303	)		(408	)
Reassessed warranty exposure		—			(343	)		—			(307	)
Balance at end of period	$	1,391		$	1,390		$	1,391		$	1,390

XML

Long-term Debt and Notes Payable

6 Months Ended

Jun. 30, 2012

Long-term Debt and Notes Payable [Abstract]

Long-term Debt and Notes Payable

6) Long-term Debt and Notes Payable

The Company extended and modified its existing credit facility by entering into a Second Amended and Restated Credit Agreement (the “Credit Agreement”), dated August 31, 2011. The Company’s Credit Agreement provides for a revolving credit line in the amount of $35 million, less outstanding letters of credit, through August 31, 2016 and for the Company’s $16 million term loan maturing January 30, 2014, with interest on both loans at a rate of LIBOR plus between 1.50% and 2.50% based on the Company’s Leverage Ratio. The credit facility allocates up to $20 million of the $35 million revolving credit line for the issuance of letters of credit, including certain existing letters of credit. The credit facility is secured by substantially all of the Company’s assets.

Prior to the August 31, 2011 amendment of the credit facility, the Company’s Credit Agreement provided for a revolving credit line of $35 million for working capital requirements which was committed through January 2012, with interest at LIBOR plus between 2.75% and 4.50%. In addition, the Company was required to pay a commitment fee of between 0.30% and 0.50% on the unused portion of the total credit commitment for the preceding quarter, based on the Company’s leverage ratio under the Credit Agreement.

There was nothing outstanding on our revolving credit facility at June 30, 2012 and December 31, 2011. The Company had available on its credit facility $23.3 million at June 30, 2012. The credit facility allocates up to $20 million of the revolving credit line for the issuance of letters of credit. At June 30, 2012, outstanding letters of credit totaled $11.7 million. In addition, the Company is required to pay a commitment fee quarterly at a rate of between 0.25% and 0.35% per annum on the unused portion of the total revolving credit commitment, also based on the Company’s Leverage Ratio.

The $5.0 million subordinated promissory note with interest fixed at 6.0% was paid in its entirety on January 13, 2012.

XML

Recent Accounting Pronouncements

6 Months Ended

Jun. 30, 2012

Recent Accounting Pronouncements [Abstract]

Recent Accounting Pronouncements

18) Recent Accounting Pronouncements

The Company’s management has reviewed recent accounting pronouncements issued through the date of the issuance of financial statements. In management’s opinion, none of these new pronouncements apply or will have a material effect on the Company’s financial statements.

XML

Legal Proceedings

6 Months Ended

Jun. 30, 2012

Legal Proceedings [Abstract]

Legal Proceedings

14) Legal Proceedings

The Company is subject to various legal proceedings, claims, and litigation arising in the ordinary course of business. While the outcome of these matters is currently not determinable, we do not expect these matters will have a material adverse effect on our business, financial position, results of operations, or cash flows. However, the results of these matters cannot be predicted with certainty. Should the Company fail to prevail in any legal matter or should several legal matters be resolved against the Company in the same reporting period, then the financial results of that particular reporting period could be materially adversely affected.

On November 11, 2010, AE Liquidation Inc. filed an action in the United States Bankruptcy Court for the District of Delaware (AE Liquidation, Inc., et al v. Luminescent Systems Inc., and AE Liquidation, Inc., et al., v Astronics Advanced Electronic Systems Corp.) seeking to recover $1.4 million of alleged preferential payments received from Eclipse Aviation Corporation. The Company disputes the Trustee’s allegations and believes any loss, as a result of future proceedings would not have a material adverse effect on our business. We intend to defend this claim vigorously.

We are a defendant in an action filed in the Regional State Court of Mannheim, Germany (Lufthansa Technik AG v. Astronics Advanced Electronics Systems Corp.) relating to an allegation of patent infringement. The damages sought include injunctive relief, as well as monetary damages. We dispute the allegation and intend to vigorously defend ourselves in this action. We have filed a nullity action with the Federal Patent Court in Munich Germany, requesting the court to revoke the German part of the European patent that is subject to the claim. In November 2011, the regional state court of Manheim Germany, issued an interim decision to the effect that the infringement litigation proceedings be stayed until the Federal Patent Court decides on the concurrent nullity action. At this time we are unable to provide a reasonable estimate of our potential liability or the potential amount of loss related to this action, if any. If the outcome of this litigation is adverse to us, our results and financial condition could be materially affected.

XML

Earnings Per Share

6 Months Ended

Jun. 30, 2012

Earnings Per Share [Abstract]

Earnings Per Share

10) Earnings Per Share

Basic and diluted weighted-average shares outstanding are as follows:

	Six Months Ended				Three Months Ended
(In thousands)	June 30, 2012		July 2, 2011		June 30, 2012		July 2, 2011
Basic earnings per share weighted average shares		12,374		12,093		12,390		12,107
Net effect of dilutive stock options		764		739		772		766
Diluted earnings per share weighted average shares		13,138		12,832		13,162		12,873

On August 2, 2011, Astronics Corporation announced a one-for-ten distribution of Class B Stock to holders of both Common and Class B Stock. On or about August 30, 2011, stockholders received one share of Class B Stock for every ten shares of Common and Class B Stock held on the record date of August 16, 2011. All share quantities, share prices and per share data reported throughout this report have been adjusted to reflect the impact of this distribution.

XML

Legal Proceedings (Details) (Eclipse Aviation Corporation [Member], USD $) In Millions, unless otherwise specified	1 Months Ended
	Nov. 30, 2010
Eclipse Aviation Corporation [Member]
Legal Proceedings (Textual) [Abstract]
Alleged preferential payments	$ 1.4

XML

Income Taxes

6 Months Ended

Jun. 30, 2012

Income Taxes [Abstract]

Income Taxes

8) Income Taxes

The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial reporting and tax basis of assets and liabilities. Deferred tax assets are reduced, if deemed necessary, by a valuation allowance for the amount of tax benefits which are not expected to be realized. Investment tax credits are recognized on the flow through method.

ASC Topic 740-10 “Overall - Uncertainty in Income Taxes” (“ASC Topic 740-10”) clarifies the accounting and disclosure for uncertainty in tax positions. ASC Topic 740-10 seeks to reduce the diversity in practice associated with certain aspects of the recognition and measurement related to accounting for income taxes. The Company is subject to the provisions of ASC Topic 740-10 and has analyzed filing positions in all of the federal and state jurisdictions where it is required to file income tax returns, as well as all open tax years in these jurisdictions. Should the Company need to accrue a liability for uncertain tax benefits, any interest associated with that liability will be recorded as interest expense. Penalties, if any, would be recognized as operating expenses. There are no penalties or interest liability accrued as of June 30, 2012 or December 31, 2011, nor are any penalties or interest costs included in expense for the periods ending June 30, 2012 and July 2, 2011. The years under which we conducted our evaluation coincided with the tax years currently still subject to examination by major federal and state tax jurisdictions, those being 2010 through 2011 for federal purposes and 2008 through 2011 for state purposes.

The effective tax rate was 31.6% and 31.9% for the six months and 30.8% and 32.2% for the three months ended June 30, 2012 and July 2, 2011, respectively. The effective tax rate for the three and six months of 2012 was impacted primarily by the domestic production activity deduction, as well as lower state and foreign taxes. The effective tax rate for the three and six months of 2011 was impacted primarily by the domestic production activity deduction as well as the impact of domestic R&D tax credits, offset somewhat by higher state and foreign taxes.

XML

Shareholders' Equity

6 Months Ended

Jun. 30, 2012

Shareholders' Equity [Abstract]

Shareholders' Equity

9) Shareholders’ Equity

The changes in shareholders’ equity for the six months ended June 30, 2012 are summarized as follows:

				Number of Shares
	Amount			Common Stock			Convertible Class B Stock
Shares Authorized					20,000,000			5,000,000
Share Par Value				$	0.01		$	0.01
(Dollars in thousands)
COMMON STOCK
Beginning of Period	$	129			9,680,825			3,194,229
Conversion of Class B Shares to Common Shares		—			249,793			(249,793	)
Exercise of Stock Options		—			31,431			18,144
End of Period	$	129			9,962,049			2,962,580
ADDITIONAL PAID IN CAPITAL
Beginning of Period	$	19,279
Stock Compensation Expense		723
Exercise of Stock Options		295
End of Period	$	20,297
ACCUMULATED OTHER COMPREHENSIVE LOSS
Beginning of Period	$	(886	)
Foreign Currency Translation Adjustment		(7	)
Mark to Market Adjustment for Derivatives		50
Retirement Liability Adjustment		(3,587	)
End of Period	$	(4,430	)
RETAINED EARNINGS
Beginning of Period	$	86,622
Net Income		11,289
End of Period	$	97,911
TREASURY STOCK
Beginning of Period	$	(2,281	)		(178,546	)		(349,795	)
Purchase (disposal)		—			—			—
End of Period	$	(2,281	)		(178,546	)		(349,795	)
TOTAL SHAREHOLDERS’ EQUITY
Beginning of Period	$	102,863			9,502,279			2,844,434
End of Period	$	111,626			9,783,503			2,612,785

XML

Comprehensive Income and Accumulated Other Comprehensive Income (Loss)

6 Months Ended

Jun. 30, 2012

Comprehensive Income and Accumulated Other Comprehensive Income [Abstract]

Comprehensive Income and Accumulated Other Comprehensive Income (Loss)

11) Comprehensive Income and Accumulated Other Comprehensive Income (Loss)

The components of accumulated other comprehensive income (loss) are as follows:

(In thousands)	June 30, 2012			Dec. 31, 2011
Foreign Currency Translation Adjustments	$	1,225		$	1,232
Mark to Market Adjustments for Derivatives – Before Tax		(316	)		(393	)
Tax Benefit		110			137
Mark to Market Adjustments for Derivatives – After Tax		(206	)		(256	)
Retirement Liability Adjustment – Before Tax		(8,415	)		(2,865	)
Tax Benefit		2,966			1,003
Retirement Liability Adjustment – After Tax		(5,449	)		(1,862	)
Accumulated Other Comprehensive Loss	$	(4,430	)	$	(886	)

The components of other comprehensive income (loss) are as follows:

	Six Months Ended						Three Months Ended
(In thousands)	June 30, 2012			July 2, 2011			June 30, 2012			July 2, 2011
Foreign Currency Translation Adjustments	$	(7	)	$	203		$	(117	)	$	(1	)
Reclassification to Interest Expense		114			155			54			78
Mark to Market Adjustments for Derivatives		(37	)		(98	)		(12	)		(98	)
Tax Expense		(27	)		(20	)		(15	)		7
Mark to Market Adjustments for Derivatives		50			37			27			(13	)
Retirement Liability Adjustment		(5,550	)		69			183			34
Tax (Expense) Benefit		1,963			(24	)		(43	)		(12	)
Retirement Liability Adjustment		(3,587	)		45			140			22
Other Comprehensive (Loss) Income	$	(3,544	)	$	285		$	50		$	8

XML

Derivative Financial Instruments (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jul. 02, 2011	Jun. 30, 2012	Jul. 02, 2011
Summary of activity in accumulated other comprehensive income related to derivatives
Derivative balance at the beginning of the period in AOCI	$ (233)	$ (288)	$ (256)	$ (338)
Net deferral in AOCI of derivatives:
Net (increase) decrease in fair value of derivatives	(12)	(98)	(37)	(98)
Tax effect	4	35	14	35
Net deferral in AOCI of derivatives	(8)	(63)	(23)	(63)
Net reclassification from AOCI into earnings:
Reclassification from AOCI into earnings - Interest expense	54	78	114	155
Tax effect	(19)	(28)	(41)	(55)
Net reclassification from AOCI into earnings	35	50	73	100
Net change in derivatives for the period	27	(13)	50	37
Derivative balance at the end of the period in AOCI	$ (206)	$ (301)	$ (206)	$ (301)

XML

Subsequent Events (Details) (USD $)			12 Months Ended
	Jun. 30, 2012	Dec. 31, 2011	Dec. 31, 2011 Max-viz, Inc [Member]	Jul. 30, 2012 Max-viz, Inc [Member]
Subsequent Events (Textual) [Abstract]
Acquired stock of Max-viz, Percentage				100.00%
Purchase consideration in cash				$ 10,000,000
Acquisition contingent consideration	(741,000)	(720,000)		8,000,000
Revenue of Max-Viz			$ 5,400,000

XML

Fair Value (Details Textual) (USD $) In Millions, unless otherwise specified	6 Months Ended
	Jun. 30, 2012
Fair Value (Textual) [Abstract]
Revenue growth target period	5 years
Maximum [Member]
Fair Value (Textual) [Abstract]
Contingent consideration on fair value liabilities	5.5
Test Systems [Member]
Fair Value (Textual) [Abstract]
Unamortized trade names	0.4
Term of amortization	10 years
Total amortized intangible assets	3.9

XML

Supplemental Retirement Plan and Related Post Retirement Benefits (Tables)

6 Months Ended

Jun. 30, 2012

Defined Benefit Plan Disclosure [Line Items]

Net periodic pension cost/net periodic cost recognized for defined benefit plans

	Six Months Ended				Three Months Ended
(In thousands)	June 30, 2012		July 2, 2011		June 30, 2012		July 2, 2011
Service cost	$	128	$	24	$	88	$	12
Interest cost		252		164		147		82
Amortization of prior service cost		181		54		122		27
Amortization of net actuarial losses		46		6		23		3
Net periodic cost	$	607	$	248	$	380	$	124

SERP [Member]

Defined Benefit Plan Disclosure [Line Items]

Net periodic pension cost/net periodic cost recognized for defined benefit plans

	Six Months Ended					Three Months Ended
(In thousands)	June 30, 2012		July 2, 2011			June 30, 2012		July 2, 2011
Service cost	$	1	$	—		$	—	$	—
Interest cost		12		14			6		7
Amortization of prior service cost		13		12			7		6
Amortization of net actuarial gains		—		(2	)		—		(1	)
Net periodic cost	$	26	$	24		$	13	$	12

XML

Earnings Per Share (Details) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jul. 02, 2011	Jun. 30, 2012	Jul. 02, 2011
Summary of basic and diluted weighted-average shares outstanding
Basic earnings per share weighted average shares	12,390	12,107	12,374	12,093
Net effect of dilutive stock options	772	766	764	739
Diluted earnings per share weighted average shares	13,162	12,873	13,138	12,832

XML

Fair Value

6 Months Ended

Jun. 30, 2012

Fair Value [Abstract]

Fair Value

16) Fair Value

ASC Topic 820, “Fair value Measurements and Disclosures”, (“ASC Topic 820”) defines fair value, establishes a framework for measuring fair value and expands the related disclosure requirements. This statement applies under other accounting pronouncements that require or permit fair value measurements. The statement indicates, among other things, that a fair value measurement assumes that the transaction to sell an asset or transfer a liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability. ASC Topic 820 defines fair value based upon an exit price model. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and involves consideration of factors specific to the asset or liability.

ASC Topic 820 establishes a valuation hierarchy for disclosure of the inputs to valuation used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows:

Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument.

Level 3 inputs are unobservable inputs based on our own assumptions used to measure assets and liabilities at fair value.

On a Recurring Basis:

A financial asset or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. The following table provides the financial assets and liabilities carried at fair value measured on a recurring basis as of June 30, 2012 and December 31, 2011:

(In thousands)	Classification	Total			Level 1		Level 2			Level 3
Interest rate swaps	Other Liabilities
June 30, 2012		$	(316	)	$	—	$	(316	)	$	—
December 31, 2011			(393	)		—		(393	)		—
Acquisition contingent consideration	Other Liabilities
June 30, 2012		$	(741	)	$	—	$	—		$	(741	)
December 31, 2011			(720	)		—		—			(720	)

Interest rate swaps are securities with no quoted readily available Level 1 inputs, and therefore are measured at fair value using inputs that are directly observable in active markets and are classified within Level 2 of the valuation hierarchy, using the income approach (See Note 17).

Our Level 3 fair value liabilities represent contingent consideration recorded related to the Ballard acquisition to be paid up to a maximum of $5.5 million if certain revenue growth targets are met over the next five years. The amounts recorded were calculated using an estimate of the probability of the future cash outflows. The varying contingent payments were then discounted to the present value utilizing a discounted cash flow methodology. The contingent consideration liability has no observable Level 1 or Level 2 inputs. There was no significant change in the fair value of this liability from December 31, 2011.

On a Non-recurring Basis:

In accordance with the provisions of ASC Topic 350 “Intangibles – Goodwill and Other” the Company estimates the fair value of reporting units, utilizing unobservable Level 3 inputs. Level 3 inputs require significant management judgment due to the absence of quoted market prices or observable inputs for assets of a similar nature. The Company utilizes a discounted cash flow analysis to estimate the fair value of reporting units utilizing unobservable inputs. The fair value measurement of the reporting unit under the step-one and step-two analysis of the goodwill impairment test are classified as Level 3 inputs.

Intangible assets that are amortized are evaluated for recoverability whenever adverse effects or changes in circumstances indicate that the carrying value may not be recoverable. The recoverability test consists of comparing the undiscounted projected cash flows with the carrying amount. Should the carrying amount exceed undiscounted projected cash flows, an impairment loss would be recognized to the extent the carrying amount exceeds fair value. For indefinite-lived intangible assets, the impairment test consists of comparing the fair value, determined using the relief from royalty method, with its carrying amount. An impairment loss would be recognized for the carrying amount in excess of its fair value.

At June 30, 2012, the fair value of goodwill and intangible assets classified using Level 3 inputs are as follows:

• Beginning January 1, 2012, previously unamortized trade names in the Test Systems segment with a fair value of $0.4 million are now being amortized over 10 years. The fair value measurement of total amortized intangible assets in the Test Systems reporting unit is $3.9 million. Inputs used to calculate the fair value were internal forecasts used to estimate undiscounted future cash flows. There was no change in fair value from December 31, 2011.

• The Ballard goodwill and intangible assets acquired on November 30, 2011, were valued at fair value using a discounted cash flow methodology and are classified as Level 3 inputs.

As of June 30, 2012, the Company concluded that no indicators of intangible or goodwill impairment existed and an interim test was not performed.

Due to their short-term nature, the carrying value of cash and equivalents, accounts receivable, accounts payable, and notes payable approximate fair value. The carrying value of the Company’s variable rate long-term debt also approximates fair value due to the variable rate feature of these instruments.

XML

Inventories (Tables)

6 Months Ended

Jun. 30, 2012

Inventories [Abstract]

Summary of Inventories

(In thousands)	June 30, 2012		December 31, 2011
Finished Goods	$	10,546	$	7,420
Work in Progress		8,089		8,477
Raw Material		25,937		24,197
	$	44,572	$	40,094

XML

Income Taxes (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jul. 02, 2011	Jun. 30, 2012	Jul. 02, 2011	Dec. 31, 2011
Income Taxes (Textual) [Abstract]
Penalties or interest liability accrued	$ 0		$ 0		$ 0
Penalties or interest expense	$ 0	$ 0	$ 0	$ 0
Effective tax rate	30.80%	32.20%	31.60%	31.90%

XML

Property, Plant and Equipment (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
Summary of Property, Plant and Equipment
Property, Plant and Equipment, Gross	$ 75,041	$ 70,570
Less Accumulated Depreciation	31,479	29,448
Property, Plant and Equipment Net	43,562	41,122
Land [Member]
Summary of Property, Plant and Equipment
Property, Plant and Equipment, Gross	2,819	2,819
Buildings and Improvements [Member]
Summary of Property, Plant and Equipment
Property, Plant and Equipment, Gross	22,774	22,760
Machinery and Equipment [Member]
Summary of Property, Plant and Equipment
Property, Plant and Equipment, Gross	39,209	37,289
Construction in Progress [Member]
Summary of Property, Plant and Equipment
Property, Plant and Equipment, Gross	$ 10,239	$ 7,702

XML

Consolidated Condensed Statements of Cash Flows (Unaudited) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2012	Jul. 02, 2011
Cash Flows from Operating Activities:
Net Income	$ 11,289	$ 9,757
Adjustments to Reconcile Net Income to Cash Provided by (Used For) Operating Activities:
Depreciation and Amortization	2,831	2,394
Provision for Non-Cash Losses on Inventory and Receivables	574	597
Stock Compensation Expense	723	537
Deferred Tax Expense	(476)	370
Other	143	(85)
Cash Flows from Changes in Operating Assets and Liabilities:
Accounts Receivable	(7,903)	(4,735)
Inventories	(5,021)	(3,559)
Accounts Payable	607	(774)
Other Current Assets and Liabilities	265	(701)
Billings in Excess of Recoverable Costs and Accrued Profits on Uncompleted Contracts	(264)	(393)
Customer Advanced Payments and Deferred Revenue	4,760	(147)
Income Taxes	1,049	(17)
Supplemental Retirement and Other Liabilities	381	(88)
Cash Provided By Operating Activities	8,958	3,156
Cash Flows from Investing Activities:
Capital Expenditures	(4,496)	(6,979)
Cash Used For Investing Activities	(4,496)	(6,979)
Cash Flows from Financing Activities:
Payments for Long-term Debt	(7,507)	(3,499)
Proceeds from Exercise of Stock Options	151	490
Income Tax Benefit from Exercise of Stock Options	144	196
Cash Used For Financing Activities	(7,212)	(2,813)
Effect of Exchange Rates on Cash	(1)	2
Decrease in Cash and Cash Equivalents	(2,751)	(6,634)
Cash and Cash Equivalents at Beginning of Period	10,919	22,709
Cash and Cash Equivalents at End of Period	$ 8,168	$ 16,075

XML

Goodwill

6 Months Ended

Jun. 30, 2012

Intangible Assets/Goodwill [Abstract]

Goodwill

5) Goodwill

The following table summarizes the changes in the carrying amount of goodwill for 2012:

(In thousands)	December 31, 2011		Foreign Currency Translation		June 30, 2012
Aerospace Segment	$	17,185	$	—	$	17,185

XML

Sales to Major Customers (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jul. 02, 2011	Jun. 30, 2012	Jul. 02, 2011	Dec. 31, 2011
Panasonic [Member]
Information relating to the activity with customers
Percent of consolidated revenue	32.00%	31.00%	37.00%	34.00%
Accounts Receivable	$ 12,872		$ 12,872		$ 9,878
U.S. Government [Member]
Information relating to the activity with customers
Percent of consolidated revenue	7.00%	8.00%	8.00%	10.00%
Accounts Receivable	$ 2,776		$ 2,776		$ 3,866

XML

Property, Plant and Equipment (Tables)

6 Months Ended

Jun. 30, 2012

Property, Plant and Equipment [Abstract]

Summary of Property, Plant and Equipment

(In thousands)	June 30, 2012		December 31, 2011
Land	$	2,819	$	2,819
Buildings and Improvements		22,774		22,760
Machinery and Equipment		39,209		37,289
Construction in Progress		10,239		7,702
		75,041		70,570
Less Accumulated Depreciation		31,479		29,448
	$	43,562	$	41,122

XML

Derivative Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2012

Derivative Financial Instruments [Abstract]

Summary of activity in accumulated other comprehensive income related to derivatives

	Six Months Ended						Three Months Ended
(In thousands)	June 30, 2012			July 2, 2011			June 30, 2012			July 2, 2011
Derivative balance at the beginning of the period in AOCI	$	(256	)	$	(338	)	$	(233	)	$	(288	)
Net deferral in AOCI of derivatives:
Net (increase) decrease in fair value of derivatives		(37	)		(98	)		(12	)		(98	)
Tax effect		14			35			4			35
		(23	)		(63	)		(8	)		(63	)
Net reclassification from AOCI into earnings:
Reclassification from AOCI into earnings – Interest expense		114			155			54			78
Tax effect		(41	)		(55	)		(19	)		(28	)
		73			100			35			50
Net change in derivatives for the period		50			37			27			(13	)
Derivative balance at the end of the period in AOCI	$	(206	)	$	(301	)	$	(206	)	$	(301	)

XML

Segment Information

6 Months Ended

Jun. 30, 2012

Segment Information [Abstract]

Segment Information

15) Segment Information

Below are the sales and operating profit by segment for the three and six months ended June 30, 2012 and July 2, 2011 and a reconciliation of segment operating profit to earnings before income taxes. Operating profit is the net sales less cost of sales and other operating expenses excluding interest and other expenses and corporate expenses. Cost of sales and other operating expenses are directly identifiable to the respective segment.

	Six Months Ended						Three Months Ended
(Dollars in thousands)	June 30, 2012			July 2, 2011			June 30, 2012			July 2, 2011
Sales
Aerospace	$	124,424		$	102,141		$	62,423		$	51,942
Test Systems		5,703			8,462			2,566			3,533
Sales	$	130,127		$	110,603		$	64,989		$	55,475
Operating Profit (Loss) and Margins
Aerospace	$	22,781		$	18,330		$	10,903		$	9,011
		18.3	%		17.9	%		17.5	%		17.3	%
Test Systems		(2,393	)		(528	)		(1,318	)		(545	)
		(42.0	)%		(6.2	)%		(51.4	)%		(15.4	)%
Total Operating Profit		20,388			17,802			9,585			8,466
		15.7	%		16.1	%		14.7	%		15.3	%
Deductions from Operating Profit
Interest Expense		529			1,071			266			534
Corporate Expenses and Other		3,347			2,399			1,809			1,224
Income Before Income Taxes	$	16,512		$	14,332		$	7,510		$	6,708

Identifiable Assets

(In thousands)	June 30, 2012		Dec. 31, 2011
Aerospace	$	152,736	$	136,930
Test Systems		18,133		20,020
Corporate		16,703		17,955
Total Assets	$	187,572	$	174,905