SOURCE: FLIR Systems, Inc.

FLIR Systems, Inc.

February 10, 2012 07:30 ET

FLIR Systems Announces Fourth Quarter and Full Year 2011 Financial Results

Fourth Quarter EPS From Continuing Operations Increases 14%; Announces 17% Increase in Dividend

PORTLAND, OR--(Marketwire - Feb 10, 2012) - FLIR Systems, Inc. (NASDAQ: FLIR) today announced financial results for the fourth quarter ended December 31, 2011. Revenue was $405.2 million, down 7% compared to fourth quarter 2010 revenue of $437.5 million. Operating income in the fourth quarter was $109.7 million, up 9% compared to $100.4 million in the fourth quarter of 2010. Fourth quarter 2011 earnings from continuing operations was $76.8 million, or $0.49 per diluted share, compared with earnings from continuing operations of $70.1 million, or $0.43 per diluted share in the fourth quarter a year ago. Cash provided by operations in the fourth quarter was $116.2 million. During the quarter, the Company repurchased 1.4 million shares of its common stock at an average price of $25.51 per share.

Revenue from the Company's Commercial Systems division increased 3% from the fourth quarter of 2010, to $224.8 million. Within the Commercial Systems division, revenue from the Thermal Vision and Measurement segment was $189.5 million, an increase of 7% over the fourth quarter combined results of Thermography and Commercial Vision Systems last year. Commercial Systems' Raymarine segment contributed $35.3 million of revenue during the quarter, a decrease of 12% compared to the fourth quarter of 2010.

Revenue from the Company's Government Systems division decreased 18% from the fourth quarter of 2010, to $180.4 million. Within the Government Systems division, revenue from the Surveillance segment was $146.4 million, a decrease of 19% from the fourth quarter of 2010 results of the Company's legacy Government Systems business. Revenues from Government Systems' other two segments, Detection and Integrated Systems were $23.6 and $10.4 million, respectively.

For the full year, revenue was $1,544.1 million, up 11% compared to $1,388.4 million for the year ended December 31, 2010. Operating income for 2011 was $313.2 million, down 13% from $360.3 million in 2010. Net income from continuing operations for 2011 was $222.7 million, or $1.38 per diluted share, compared with 2010 net income from continuing operations of $248.4 million, or $1.54 per diluted share. Excluding the net after tax impact of litigation and severance costs, 2011 net income from continuing operations was $254.4 million, or $1.58 per diluted share. Cash provided by operations during the year was $243.9 million.

The Company's backlog of firm orders for delivery within the next twelve months was approximately $456 million at December 31, 2011, a decrease of $90 million during the quarter. Backlog in the Government Systems division was $314 million, decreasing $60 million during the quarter. Backlog in the Commercial Systems division was $142 million, down $30 million during the quarter.

"The fourth quarter showcased our ability to adapt and persevere through a challenging macro environment. During the quarter, we expanded margins -- gross, operating, and net income -- to their highest levels in over a year and cash flow from operations reached its highest quarterly total ever," said Earl Lewis, President and CEO of FLIR. "Our focus on operational efficiency and innovation throughout 2011 enabled us to drive profitability and has positioned the company for success in the future."

Revenue and Earnings Outlook for 2012
FLIR also announced today that it expects revenue in 2012 to be in the range of $1.55 billion to $1.65 billion, an increase of approximately 0% to 7% compared to 2011, and net income to be in the range of $1.60 to $1.70 per diluted share, an increase of approximately 16% to 23% compared to 2011.

Dividend Increase and Declaration
FLIR's Board of Directors has approved a quarterly cash dividend of $0.07 per share on FLIR common stock, an increase of 17% over the previous paid quarterly dividend of $0.06 per share. The Board of Directors has declared the dividend payable March 9, 2012, to shareholders of record as of close of business on February 21, 2012.

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 year. A simultaneous webcast of the conference call may be accessed online from a link in the Upcoming Events section of www.FLIR.com/investor. A replay will be available after 2:00 p.m. ET (5:00 p.m. PT) at this same internet address. For a telephone replay, dial (855) 859-2056, Conference ID #45459716 after 2:00 p.m. ET. Summary fourth quarter and historical financial data, including segment details, may be accessed online from the Summary Financial Data section 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. The Company's advanced thermal imaging and threat detection systems are used for a wide variety of imaging, thermography, and security applications, including airborne and ground-based surveillance, condition monitoring, research and development, manufacturing process control, search and rescue, drug interdiction, navigation, transportation safety, border and maritime patrol, environmental monitoring, and chemical, biological, radiological, nuclear, and explosives (CBRNE) detection. Visit the Company's web site at www.FLIR.com.

Forward-Looking Statements
The statements in this release by Earl Lewis and the statements in the section captioned "Revenue and Earnings Outlook for 2012" 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 the Company'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 the Company's products, product mix, the timing of customer orders and deliveries, the impact of competitive products and pricing, the Company'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 the Company to act as a federal contractor, the amount and availability of appropriated government procurement funds and other risks discussed from time to time in the Company'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 the Company 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.

FLIR SYSTEMS, INC.
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)(Unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
2011 2010(1) 2011 2010(1)
Revenue $ 405,212 $ 437,509 $ 1,544,062 $ 1,388,437
Cost of goods sold 180,427 204,653 715,458 624,796
Gross profit 224,785 232,856 828,604 763,641
Operating expenses:
Research and development 34,920 35,003 147,177 116,635
Selling, general and administrative 80,197 97,486 368,232 286,695
Total operating expenses 115,117 132,489 515,409 403,330
Earnings from operations 109,668 100,367 313,195 360,311
Interest expense 3,175 412 5,487 2,884
Interest income (768 ) (359 ) (1,273 ) (1,258 )
Other income, net (892 ) (1,596 ) (2,098 ) (4,015 )
Earnings from continuing operations before income taxes 108,153 101,910 311,079 362,700
Income tax provision 31,318 31,840 88,427 114,326
Earnings from continuing operations 76,835 70,070 222,652 248,374
Loss from discontinued operations, net of tax (705 ) (248 ) (1,178 ) (248 )
Net earnings $ 76,130 $ 69,822 $ 221,474 $ 248,126
Basic earnings per share:
Earnings from continuing operations $ 0.49 $ 0.44 $ 1.41 $ 1.59
Discontinued operations (0.00 ) (0.00 ) (0.01 ) (0.00 )
Basic earnings per share $ 0.49 $ 0.44 $ 1.40 $ 1.59
Diluted earnings per share:
Earnings from continuing operations $ 0.49 $ 0.43 $ 1.38 $ 1.54
Discontinued operations (0.00 ) (0.00 ) $ (0.01 ) (0.00 )
Diluted earnings per share $ 0.48 $ 0.43 $ 1.38 $ 1.54
Weighted average shares outstanding:
Basic 155,647 158,867 158,323 156,141
Diluted 157,611 161,510 160,851 161,630
(1) Amounts have been adjusted for the reclassification of certain discontinued operations to continued operations.
FLIR SYSTEMS, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)(Unaudited)
December 31, December 31,
2011 2010
ASSETS
Current assets:
Cash and cash equivalents $ 440,846 $ 193,137
Accounts receivable, net 325,370 339,723
Inventories 336,051 303,156
Prepaid expenses and other current assets 104,285 95,663
Deferred income taxes, net 27,304 23,128
Total current assets 1,233,856 954,807
Property and equipment, net 186,269 189,119
Deferred income taxes, net 31,078 22,742
Goodwill 498,343 482,019
Intangible assets, net 164,440 177,385
Other assets 32,338 31,280
$ 2,146,324 $ 1,857,352
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 84,190 $ 85,881
Deferred revenue 24,046 17,867
Accrued payroll and related liabilities 49,475 54,894
Accrued product warranties 13,370 15,711
Advance payments from customers 13,219 22,616
Accrued expenses 41,183 36,578
Other current liabilities 3,886 8,186
Accrued income taxes 2,161 8,218
Total current liabilities 231,530 249,951
Long-term debt 247,861 -
Deferred income taxes 16,532 13,163
Accrued income taxes 17,537 19,793
Pension and other long-term liabilities 53,835 51,897
Commitments and contingencies
Shareholders' equity 1,579,029 1,522,548
$ 2,146,324 $ 1,857,352
FLIR SYSTEMS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)(Unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
2011 2010 2011 2010
Cash Provided By Operating Activities:
Net earnings $ 76,130 $ 69,822 $ 221,474 $ 248,126
Income items not affecting cash:
Depreciation and amortization 16,290 21,831 77,498 61,297
Deferred income taxes (10,291 ) (5,702 ) (12,195 ) (14,099 )
Stock-based compensation arrangements 5,604 6,565 24,917 25,575
Other non-cash items 9,647 9,518 12,654 10,320
Changes in operating assets and liabilities, net of acquisitions 18,816 (56,728 ) (80,457 ) (75,968 )
Cash provided by operating activities 116,196 45,306 243,891 255,251
Cash Used By Investing Activites:
Additions to property and equipment, net (10,850 ) (14,748 ) (41,946 ) (65,748 )
Business acquisitions, net of cash acquired - (228,026 ) (27,182 ) (402,721 )
Other investments 1,991 - 1,991 3,080
Cash used by investing activities (8,859 ) (242,774 ) (67,137 ) (465,389 )
Cash (Used) Provided by Financing Activities:
Proceeds from long term debt, net - - 247,708 -
Repurchase of common stock (36,286 ) - (160,669 ) (35,725 )
Dividends paid (9,350 ) - (38,037 ) -
Proceeds from shares issued pursuant to stock-based compensation plans 6,620 9,485 21,706 21,469
Excess tax benefit of stock options exercised 727 2,057 5,195 7,649
Other financing activities (140 ) 103 (458 ) 120
Cash (used) provided by financing activities (38,429 ) 11,645 75,445 (6,487 )
Effect of exchange rate changes on cash (2,561 ) (943 ) (4,490 ) (12,285 )
Net increase (decrease) in cash and cash equivalents 66,347 (186,766 ) 247,709 (228,910 )
Cash and cash equivalents, beginning of year 374,499 379,903 193,137 422,047
Cash and cash equivalents, end of year $ 440,846 $ 193,137 $ 440,846 $ 193,137

Contact Information

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