SOURCE: FLIR Systems, Inc.

FLIR Systems, Inc.

April 25, 2014 07:30 ET

FLIR Systems Announces First Quarter 2014 Financial Results

WILSONVILLE, OR--(Marketwired - Apr 25, 2014) - FLIR Systems, Inc. (NASDAQ: FLIR) today announced financial results for the first quarter ended March 31, 2014. Revenue was $351.5 million, up 1% compared to first quarter 2013 revenue of $348.6 million. Operating income in the first quarter was $42.5 million, compared to $69.1 million in the first quarter of 2013, and was impacted by $8.4 million in pretax charges related to previously-announced restructuring initiatives. First quarter 2014 net income was $29.9 million, or $0.21 per diluted share, compared with net income of $51.6 million, or $0.35 per diluted share in the first quarter a year ago. The net after tax impact of the restructuring charges in the first quarter was approximately $6.4 million, or $0.04 per diluted share. Cash provided by operations in the first quarter was $59.8 million, a decrease of 3% compared to the first quarter of 2013.

Revenue from FLIR's Surveillance segment was $117.2 million, a decrease of 1% from the first quarter results last year. The Instruments segment contributed $84.1 million of revenue during the first quarter, up 7% from the prior year. The OEM & Emerging Markets segment had $53.8 million of revenue, an increase of 7% over the prior year. Revenue from the Maritime segment was $52.6 million, and was up 4% over the first quarter of 2013. FLIR's Security segment recorded revenue of $29.3 million in the first quarter, down 1% from the prior year. The Detection segment contributed $14.6 million of revenue, a decrease of 33% from the prior year.

FLIR's backlog of firm orders for delivery within the next twelve months was approximately $514 million as of March 31, 2014, an increase of $24 million during the quarter.

"Our first quarter results were in-line with our expectations. Healthy growth in our commercial-oriented markets was offset by declines in government-funded sectors. We continued executing on our realignment plan, which we believe will be a valuable investment for our long-term performance," said Andy Teich, President and CEO of FLIR. "We expect continued improvement as we move throughout this year and are excited about our product pipeline that is enabled by our new Lepton core."

Revenue and Earnings Outlook for 2014
Based on financial results for the first three months of 2014 and the outlook for the remainder of the year, FLIR is reaffirming its outlook for revenue and earnings per share for the full year 2014. Management expects revenue for 2014 to be in the range of $1.45 billion to $1.55 billion and net earnings excluding restructuring charges associated with the business realignment to be in the range of $1.40 to $1.50 per diluted share. 

Dividend Declaration
FLIR's Board of Directors has declared a quarterly cash dividend of $0.10 per share on FLIR common stock, payable June 6, 2014, to shareholders of record as of close of business on May 20, 2014.

Conference Call
FLIR has scheduled a conference call at 11:00 a.m. ET (8:00 a.m. PT) today to discuss its results for the quarter and the year. A simultaneous webcast of the conference call may be accessed online from a link in the Events & Presentations section of www.FLIR.com/investor. A replay will be available after 2:00 p.m. ET (11:00 a.m. PT) at this same Internet address. Summary first quarter and historical financial data can be accessed online from the Financial Info Database link at www.FLIR.com/investor.

About FLIR Systems
FLIR Systems, Inc. is a world leader in the design, manufacture, and marketing of sensor systems that enhance perception and awareness. FLIR's advanced systems and components are used for a wide variety of thermal imaging, situational awareness, and security applications, including airborne and ground-based surveillance, condition monitoring, navigation, recreation, research and development, manufacturing process control, search and rescue, drug interdiction, transportation safety, border and maritime patrol, environmental monitoring, and chemical, biological, radiological, nuclear, and explosives (CBRNE) threat detection. For more information, visit FLIR's web site at www.FLIR.com.

Forward-Looking Statements
The statements in this release by Andy Teich and the statements in the section captioned "Revenue and Earnings Outlook for 2014" above are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are based on current expectations, estimates, and projections about FLIR's business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including the following: changes in demand for FLIR's products, product mix, the timing of customer orders and deliveries, the impact of competitive products and pricing, FLIR's continuing compliance with U.S. export control laws and regulations, the timely receipt of any required export licenses, constraints on supplies of critical components, excess or shortage of production capacity, the ability to manufacture and ship the products in the time period required, actual purchases under agreements, the continuing eligibility of FLIR to act as a federal contractor, the amount and availability of appropriated government procurement funds and other risks discussed from time to time in FLIR's Securities and Exchange Commission filings and reports. In addition, such statements could be affected by general industry and market conditions and growth rates, and general domestic and international economic conditions. Such forward-looking statements speak only as of the date on which they are made and FLIR does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release, or for changes made to this document by wire services or internet service providers.

(Tables Below)

   
   
FLIR SYSTEMS, INC.  
CONSOLIDATED STATEMENTS OF INCOME  
(In thousands, except per share amounts)(Unaudited)  
   
    Three Months Ended  
    March 31,  
    2014     2013  
                 
Revenue   $ 351,542     $ 348,583  
Cost of goods sold     183,010       164,596  
    Gross profit     168,532       183,987  
                     
Operating expenses:                
  Research and development     36,326       36,684  
  Selling, general and administrative     81,942       78,173  
  Restructuring expenses     7,813       -  
    Total operating expenses     126,081       114,857  
    Earnings from operations     42,451       69,130  
                     
Interest expense     3,708       2,897  
Interest income     (264 )     (191 )
Other income, net     (198 )     (764 )
    Earnings from continuing operations before income taxes     39,205       67,188  
                     
Income tax provision     9,311       15,552  
    Net earnings   $ 29,894     $ 51,636  
                 
Earnings per share:                
  Basic   $ 0.21     $ 0.36  
  Diluted   $ 0.21     $ 0.35  
                 
Weighted average shares outstanding:                
  Basic     140,932       144,629  
  Diluted     143,828       146,291  
                   
                   
 
 
FLIR SYSTEMS, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)(Unaudited)
         
    March 31,   December 31,
    2014   2013
ASSETS        
             
Current assets:            
  Cash and cash equivalents   $ 584,095   $ 542,476
  Accounts receivable, net     270,165     286,573
  Inventories     338,894     344,719
  Prepaid expenses and other current assets     98,386     97,574
  Deferred income taxes, net     38,660     38,389
    Total current assets     1,330,200     1,309,731
             
Property and equipment, net     232,904     234,041
Deferred income taxes, net     18,079     17,883
Goodwill     574,007     575,701
Intangible assets, net     159,602     154,195
Other assets     52,359     51,808
    $ 2,367,151   $ 2,343,359
             
LIABILITIES AND SHAREHOLDERS' EQUITY            
             
Current liabilities:            
  Accounts payable   $ 91,965   $ 85,730
  Deferred revenue     23,951     28,844
  Accrued payroll and related liabilities     60,370     62,069
  Accrued expenses     36,159     39,316
  Accrued income taxes     138     663
  Other current liabilities     43,578     44,893
  Current portion long-term debt     15,000     15,000
    Total current liabilities     271,161     276,515
             
Long-term debt     368,892     372,528
Deferred income taxes     12,339     12,255
Accrued income taxes     20,763     19,996
Other long-term liabilities     49,966     48,685
             
Commitments and contingencies            
             
Shareholders' equity     1,644,030     1,613,380
    $ 2,367,151   $ 2,343,359
             
             
   
   
FLIR SYSTEMS, INC.  
CONSOLIDATED STATEMENTS OF CASH FLOWS  
(In thousands)(Unaudited)  
             
    Three Months Ended  
    March 31,  
    2014     2013  
                 
Cash flows from operating activities:                
  Net earnings   $ 29,894     $ 51,636  
  Income items not affecting cash:                
    Depreciation and amortization     16,470       14,871  
    Deferred income taxes     (235 )     44  
    Stock-based compensation arrangements     8,756       5,696  
  Other non-cash items     (1,564 )     2,374  
  Changes in operating assets and liabilities, net of acquisitions     6,504       (12,662 )
Cash provided by operating activities     59,825       61,959  
                 
Cash flows from investing activities:                
  Additions to property and equipment, net     (9,590 )     (12,648 )
Cash used by investing activities     (9,590 )     (12,648 )
                 
Cash flows from financing activities:                
  Repayments of long term debt     (3,750 )     -  
  Repurchase of common stock     (1,766 )     (108,361 )
  Dividends paid     (14,085 )     (13,106 )
  Proceeds from shares issued pursuant to stock-based compensation plans     8,876       1,179  
  Excess tax benefit of stock options exercised     2,698       234  
  Other financing activities     252       (22 )
Cash used by financing activities     (7,775 )     (120,076 )
                 
Effect of exchange rate changes on cash     (841 )     (4,967 )
                 
Net increase (decrease) in cash and cash equivalents     41,619       (75,732 )
Cash and cash equivalents, beginning of period     542,476       321,739  
Cash and cash equivalents, end of period   $ 584,095     $ 246,007  
                 
                 
   
   
FLIR SYSTEMS, INC.  
REVENUE AND EARNINGS FROM OPERATIONS BY SEGMENT  
(In thousands)(Unaudited)  
             
    Three Months Ended  
    March 31,  
    2014     2013  
REVENUE - EXTERNAL CUSTOMERS                
  Surveillance   $ 117,201     $ 117,987  
  Instruments     84,056       78,550  
  OEM and Emerging Markets     53,801       50,285  
  Maritime     52,575       50,462  
  Security     29,309       29,472  
  Detection     14,600       21,827  
    $ 351,542     $ 348,583  
                 
EARNINGS (LOSS) FROM OPERATIONS                
  Surveillance   $ 20,361     $ 33,726  
  Instruments     20,450       20,024  
  OEM and Emerging Markets     11,711       14,596  
  Maritime     8,830       8,107  
  Security     1,686       4,389  
  Detection     (1,800 )     2,545  
  Other     (18,787 )     (14,257 )
    $ 42,451     $ 69,130  
                 
                 

Contact Information

  • Company Contact:
    Shane Harrison
    +1 503.498.3547
    www.flir.com