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Astronics Corporation is involved in two distinct niches: high-tech electroluminescent lamps and keyboards, and specialty packaging. Astronics supplies various types of lighting for military aircraft and 300 commercial airlines; its Aerospace and Electronics division counts commercial and military clients in 47 countries. Specialty Packaging has 10,000 customers in two dozen countries. Continually investing a hefty portion of earnings into RD and process improvements, Astronics has placed more than once on the Forbes list of the "200 Best Small Companies."

Luminous Origins

French physicist G. Destriau discovered electroluminescence in 1937. In this phenomenon, a cool light emits from an electroluminescent material sandwiched between two electrodes under alternating current (ac power). Scientists spent the next couple of decades making the discovery practical.

In December 1968, Thomas L. Robinson, Sr. established the Astronics Corp., the first company solely dedicated to developing electroluminescent panels. (It was founded independently of the Santa Monica-based Lear Astronics, formed in 1958 by aviation pioneer Bill Lear.) Robinson had been a project engineer at the Cornell Aeronautical Laboratory, where he developed electro-optical devices. He formed Astronics because existing technology was not advanced enough to allow him to complete an electroluminescent flat screen display for the Goddard Space Center while he was at Cornell. (This was completed in 1972.)

Flexible, lightweight, and thin as paper, these solid-state devices produced more light at lower voltage and lower frequencies than conventional incandescent or fluorescent bulbs. They stayed cool and wore out gradually rather than burning out like light bulbs.

The company's first home was the Gardenville Industrial Park in West Seneca, near Buffalo, New York. It later rented space from Moog Inc. at 300 French Road in Cheektowaga. Peter Gombirch, formerly a regional sales manager at Singer Co.'s Industrial Control Division, headed sales and marketing. Its four other employees were all related: Robinson's wife, Bessie, and two sons Thomas, Jr., and Roy.

First year revenues were only $13,000. Sales volume fell to just $1,777 in 1970 as the company devoted its time to research and development. Robinson called on George F. Rand III, chairman of Rand Capital Corp., for financial backing. Rand sent Kevin T. Keane to evaluate the company's business prospects. Keane liked them; he left Maday Body Equipment Corp. (of which he was part owner) at the end of 1970 to help the inventor's company along. He became president two years later when Robinson retired.

Rand Capital's investment in late 1970 allowed Astronics to document its RD efforts and gain a contract from NASA via the Singer Co. That project involved making displays for Skylab. The panels also were used in aircraft and sea vessels. Sometimes called Astronics Luminescent Inc., Astronics had about eleven employees and billed $14,000 during 1971. At year end, Keane asked John Kerr, an engineer and Harvard MBA, to join the company as a vice-president. The company filed a stock offering in December 1971 to raise $1.8 million. Before the offering, the Robinson family and Rand Capital Corp. each owned a third of the stock. Half of the money was to fund research and development and establish production facilities. After expenses, however, only about $800,000 was raised; the company decided to use some of it for acquisitions.

Contained Growth in the 1970s and 1980s

Astronics bought A~T-O Inc.'s Scott Aviation Division for $120,000 in May 1972. Scott manufactured panel lighting for Piper and Cessna aircraft. The Scott purchase also gave Astronics entr‚e into the military market. In December, Astronics bought 90 percent of MOD-PAC Corp., which manufactured paperboard cartons and boxes. It had nearly $2 million in annual sales, more than ten times that of Astronics. Formerly the Cooper Box Co., its history dated back to 1888. Although ostensibly unrelated to the aerospace business, MOD-PAC represented good investment potential; there was also some transferable expertise in its graphics department.

A 14,000-square-foot building at 77 Olean Road in East Aurora was purchased in January 1973. The company relocated its entire electroluminescent operation there. Employment increased to 105 by October 1973. By this time, Astronics was supplying electroluminescent instrument lighting to the Big Three U.S. automakers as well as all levels of aerospace producers including Beech Aircraft and Lear. Military aircraft used exterior lighting strips to facilitate formation flying in low visibility. The company also supplied the nascent copy machine industry.

Profits were $130,340 on sales of $2.7 million in 1974. Sales reached $3.4 million in 1976 and $4.3 million the next, with earnings of $283,000. In November 1977, Astronics bought United Business Equipment Corp. (UBEC) of Buffalo, which sold $1 million of filing systems a year.

Astronics continued to develop printed circuit processes. It worked with Gloucester, Massachusetts-based Flex-Key Corp. to develop a lighted keypad. (Astronics later acquired Flex-Key.) Prototypes of lighted safety vests for park rangers were made for the Park Service; Astronics also was developing applications in ophthalmology and photography and toying with consumer applications. Eastman Kodak used the lighting strips within its darkened film processing plant in Rochester, New York. They were tinted so as not to mar undeveloped film. Kodak also used special electroluminescent flashlights, which used much less power than ones with conventional bulbs.

By 1979, Astronics was posting annual sales of $8 million a year. MOD-PAC had 90 employees and contributed sales of about $3.5 million. This growth came against a backdrop of layoffs and plant closings among Buffalo's traditional industries such as steel and automobiles. Astronics had created 115 jobs in its first decade.

Although executives were pursuing opportunities for vertical integration, the company acquired Buffalo-based Rodgard Manufacturing Co. in 1981. Rodgard produced industrial plastics products and employed 40 persons. Its annual sales were about $2 million.

Astronics had sales of $125 million in 1986-87. It invested in automating its PC board assembly processes. The company bought the Grimes Electroluminescent Lighting Product Group in 1988. Earnings dwindled to earned $20,000 on sales of $21.9 million in 1988. A $2 million loss on sales of $22.2 million in 1989 prompted Keane to implement a restructuring plan. The company had several more years of declining defense spending to endure.

New Heights in the 1990s

Annual sales held at $7 million in 1991 and 1992. The company began to invest $2 to $3 million a year in capital improvements in the mid~1990s while reducing its debt load. In 1994, Flex-Key operations were moved from Massachusetts to East Aurora, New York, where they were consolidated with those of the E~L Products Co. under the name E~L FlexKey Technologies Inc. Both units had significant military sales. Flex-Key had 40 employees at the time. Astronics had about 300 employees in all. Astronics acquired the assets of Loctite Luminescent Systems Inc. in November 1995 for about $6.5 million, also integrating the new unit, expected to contribute $11 million a year to revenues, into the E~L FlexKey Technologies Inc. subsidiary.

Concerned by its depressed share price, the company began buying back stock in July 1994. Profits rose ten percent to $1.3 million in 1994 on slightly increased sales of $24.9 million. In February 1995, the company announced that it was relocating its headquarters to the MOD-PAC plant as a practical consideration. Keane had been running that packaging subsidiary for the previous four years. That year, MOD-PAC installed the first Heidelberg printing press in the western hemisphere. Its unique coating capabilities won Astronics preferred supplier status to Hershey Foods. In 1996, the company doubled the capacity of its Blasdell, New York specialty packaging facility.

The Rodgard Division was sold to Trenton, New Jersey-based Hutchinson Industries, Inc. (a subsidiary of the French company Hutchinson S.A.) for $2.25 million in late 1996. The sale completed plans to focus Astronics on just two business segments: Specialized Packaging and Printing and Electronic Systems. (The latter was renamed Aerospace and Electronics in 1997.)

1968:Cornell engineer founds Astronics to develop electroluminescent lamp technology.

1970:Rand Capital provides cash infusion needed to land major Skylab contract.

1972:Astronics enters specialty packaging business through purchase of MOD-PAC Corp.

1989:A $2 million dollar loss prompts a restructuring program.

1994:After reducing debt and investing in process improvements, Astronics begins buying back shares.

1999:Astronics wins a major contract to retrofit F-16s with night vision equipment.

2000:The Specialty Packaging division wins its biggest contract ever, from Tyco Healthcare.

By 1996, the process improvements were paying off as Astronics posted record results: profits increased 51 percent to $2.7 million on sales of $38.4 million, up 35 percent. The company had begun to implement ISO 9001 quality standards throughout the Aerospace and Electronics and Specialty Packaging divisions and picked up the Staples Office Superstore chain as a client.

In April 1999, Astronics officials announced plans for a new $6 million plant for the Luminescent Systems division. A $50 million award to make night vision modification kits for U.S. Air Force F-16s was responsible for half of the 70 new jobs tied to the expansion. Military contracts accounted for less than 30 percent of the division's business, however. In October 1999, Aerospace and Electronics moved into new facilities in Lebanon, New Hampshire, consolidating four locations in the state.

Astronics continued to post record sales and earnings in 1999. Profits were $4.8 million on sales of $50.6 million. Aerospace and Electronics accounted for slightly more than half (52 percent) of total sales. The company had doubled sales in the previous five years, when it averaged compounded annual earnings growth of 22 percent.

Astronics continued to expand its specialty packaging business as well, which had logged more than 25 years of double digit sales growth. It invested nearly 30 percent of 1999 sales in new technology, installing computer to plate technology for made-to-order packaging. In January 2000 MOD-PAC won the largest contract in its history, worth $15 million, to supply printed folding cartons for the Tyco Healthcare Group's northeastern manufacturing plants. The new business prompted plans to hire up to 30 more workers at the Buffalo packaging plant, bringing employment there to 250. MOD-PAC won the contract through its relationship with Graphic Controls Corp., which was acquired by Tyco in 1998. Specialty Packaging contributed about $24 million a year to total sales. The division was also preferred supplier to Hershey Foods and Staples Office Superstores.

As it moved up the defense contractor "food chain" in 1999, Astronics was farming out 75 percent of its F~16-related work. It hoped to take half of that in~house again with its new plants in New Hampshire and East Aurora to double or triple profit margins. In May 2000, Astronics acquired some F~16-related switches and indicators lines from Aerospace Avionics, Inc., a Bohemia, New York-based subsidiary of Smiths Industries. The company bought CRL Technologies of Quebec for CD $4 million in the same month. CRL produced lighted keyboards with applications in the F-16 cockpit and many other places.

Company officials expected sales to rise by 40 percent in 2000, topping $70 million. Commercial and private aircraft manufacturers and operators were ordering more cockpit and exit lighting as well. New aerospace programs included the Lockheed F-22 fighter and Embraer regional jets. The company also was lighting up portable electronic devices such as digital watches and cellular phones through its MaxEL line of high-volume, low~cost electroluminescent devices.

Principal Subsidiaries: Luminescent Systems, Inc.; MOD-PAC Corporation.

Principal Divisions: Aerospace and Electronics; Specialty Packaging.

Principal Competitors: All American Packaging; Field Container Company L.P.; Inductotherm Industries; James River Corp.; Targetti-Tivoli; Universal Packaging Corp.; Westvaco Corp.

Source: International Directory of Company Histories, Vol. 35. St. James Press, 2001.