WILSONVILLE, OR--(Marketwired - Oct 24, 2013) - FLIR Systems, Inc. (
Revenue from FLIR's Commercial Systems division increased 17% from the third quarter of 2012, to $212.9 million. Within the Commercial Systems division, revenue from the Thermal Vision and Measurement segment was $177.1 million, an increase of 18% from the third quarter results last year, due to the addition of the Lorex and Traficon businesses. The Raymarine segment contributed $35.8 million of revenue during the third quarter, up 13% from the prior year, driven by successful new product introductions.
Revenue from FLIR's Government Systems division decreased 4% from the third quarter of 2012, to $145.2 million. Within the Government Systems division, revenue from the Surveillance segment was $103 million, a decrease of 11% from the third quarter of 2012, impacted negatively by weak book-and-ship order flow from the U.S. Government. Revenue from the Detection segment was $13.1 million, a decrease of 15% compared to the third quarter of 2012 as the business continues its strategy to reduce contract R&D activity. The Integrated Systems segment contributed $29.2 million of revenue during the third quarter, an increase of 48% from the prior year, due to deliveries under the MSC contract during the third quarter of 2013.
The Company's backlog of firm orders for delivery within the next twelve months was approximately $523 million as of September 30, 2013, a decrease of $5 million during the quarter and $42 million from a year ago. Backlog in the Government Systems division was $334 million, decreasing $5 million during the quarter and $58 million from the prior year. Backlog in the Commercial Systems division was $189 million, a decrease of $1 million during the quarter but an increase of $16 million over the prior year.
"Results for the third quarter were disappointing; however, with the exception of our OEM cores business, our Commercial Systems business grew mid-single digits with each of the major geographic regions showing growth for the first time in two years. We were also pleased with the performance of our recently acquired businesses, which delivered good growth and profitability for the quarter," noted Andy Teich, President and CEO of FLIR. "The weakness in order flow from U.S. Government-funded customers affected our book-and-ship business in the third quarter and, more importantly, the outlook for the fourth quarter. In addition to our strategic realignment plan, we have initiated changes to our cost structure to better operate under the assumption of a challenging domestic government procurement environment. We expect to see significant productivity and profitability gains from these actions in 2014 and beyond."
Revenue and Earnings Outlook for 2013
Based on financial results for the first nine months of 2013 and the outlook for the remainder of the year, FLIR now expects 2013 revenue to be in the range of $1.45 billion to $1.5 billion and net income, excluding restructuring charges associated with business realignment and cost reduction initiatives as well as executive retirement charges, to be in the range of $1.38 to $1.43 per diluted share. These estimates compare with management's prior outlook of revenue of $1.5 billion to $1.6 billion and net income of $1.56 to $1.66 per diluted share.
Dividend Declaration
FLIR's Board of Directors has declared a quarterly cash dividend of $0.09 per share on FLIR common stock, payable December 6, 2013, to shareholders of record as of close of business on November 18, 2013.
Conference Call
FLIR has scheduled a conference call at 8:00 a.m. ET (5:00 a.m. PT) today to discuss its results for the quarter. A simultaneous webcast of the conference call may be accessed online from the Events & Presentations section at www.FLIR.com/investor. A replay will be available after 11:00 a.m. ET (8:00 a.m. PT) at this same internet address. Summary third quarter and historical financial data can be accessed online soon after the release of the third quarter results 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 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 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 2013" 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 ability to develop new products in an efficient and timely manner, 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.
| FLIR SYSTEMS, INC. | ||||||||||||||||||
| CONSOLIDATED STATEMENTS OF INCOME | ||||||||||||||||||
| (In thousands, except per share amounts)(Unaudited) | ||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||
| September 30, | September 30, | |||||||||||||||||
| 2013 | 2012 | 2013 | 2012 | |||||||||||||||
| Revenue | $ | 358,141 | $ | 332,230 | $ | 1,096,053 | $ | 1,018,973 | ||||||||||
| Cost of goods sold | 185,251 | 158,877 | 549,134 | 492,865 | ||||||||||||||
| Gross profit | 172,890 | 173,353 | 546,919 | 526,108 | ||||||||||||||
| Operating expenses: | ||||||||||||||||||
| Research and development | 32,986 | 29,593 | 109,271 | 103,674 | ||||||||||||||
| Selling, general and administrative | 76,365 | 69,523 | 234,706 | 219,181 | ||||||||||||||
| Total operating expenses | 109,351 | 99,116 | 343,977 | 322,855 | ||||||||||||||
| Earnings from operations | 63,539 | 74,237 | 202,942 | 203,253 | ||||||||||||||
| Interest expense | 3,696 | 3,096 | 10,361 | 8,930 | ||||||||||||||
| Interest income | (256 | ) | (268 | ) | (721 | ) | (1,073 | ) | ||||||||||
| Other expense (income), net | 53 | 2,175 | (536 | ) | 1,190 | |||||||||||||
| Earnings from continuing operations before income taxes | 60,046 |
69,234 |
193,838 |
194,206 |
||||||||||||||
| Income tax provision | 13,560 | 13,285 | 45,558 | 47,027 | ||||||||||||||
| Earnings from continuing operations | 46,486 | 55,949 | 148,280 | 147,179 | ||||||||||||||
| Loss from discontinued operations, net of tax | - | (44 | ) | - | (2,042 | ) | ||||||||||||
| Net earnings | $ | 46,486 | $ | 55,905 | $ | 148,280 | $ | 145,137 | ||||||||||
| Basic earnings per share: | ||||||||||||||||||
| Earnings from continuing operations | $ | 0.33 | $ | 0.37 | $ | 1.04 | $ | 0.96 | ||||||||||
| Discontinued operations | - | (0.00 | ) | - | (0.01 | ) | ||||||||||||
| Basic earnings per share | $ | 0.33 | $ | 0.37 | $ | 1.04 | $ | 0.95 | ||||||||||
| Diluted earnings per share: | ||||||||||||||||||
| Earnings from continuing operations | $ | 0.32 | $ | 0.37 | $ | 1.02 | $ | 0.95 | ||||||||||
| Discontinued operations | - | (0.00 | ) | - | (0.01 | ) | ||||||||||||
| Diluted earnings per share | $ | 0.32 | $ | 0.37 | $ | 1.02 | $ | 0.94 | ||||||||||
| Weighted average shares outstanding: | ||||||||||||||||||
| Basic | 141,863 | 150,878 | 142,849 | 152,820 | ||||||||||||||
| Diluted | 144,231 | 152,327 | 144,831 | 154,758 | ||||||||||||||
| FLIR SYSTEMS, INC. | ||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||
| (In thousands)(Unaudited) | ||||||||
| September 30, | December 31, | |||||||
| 2013 | 2012 | |||||||
| ASSETS | As Adjusted(1) | |||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 492,199 | $ | 321,739 | ||||
| Accounts receivable, net | 281,611 | 335,163 | ||||||
| Inventories | 376,033 | 381,378 | ||||||
| Prepaid expenses and other current assets | 98,001 | 96,006 | ||||||
| Deferred income taxes, net | 31,659 | 30,960 | ||||||
| Total current assets | 1,279,503 | 1,165,246 | ||||||
| Property and equipment, net | 229,844 | 211,615 | ||||||
| Deferred income taxes, net | 32,235 | 32,223 | ||||||
| Goodwill | 567,611 | 562,586 | ||||||
| Intangible assets, net | 157,489 | 175,823 | ||||||
| Other assets | 59,194 | 41,442 | ||||||
| $ | 2,325,876 | $ | 2,188,935 | |||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 93,861 | $ | 94,156 | ||||
| Deferred revenue | 30,308 | 29,465 | ||||||
| Accrued payroll and related liabilities | 39,139 | 41,506 | ||||||
| Accrued expenses | 41,977 | 32,772 | ||||||
| Other current liabilities | 31,528 | 31,725 | ||||||
| Accrued income taxes | - | 11,943 | ||||||
| Current portion long-term debt | 15,000 | - | ||||||
| Total current liabilities | 251,813 | 241,567 | ||||||
| Long-term debt | 376,163 | 248,319 | ||||||
| Deferred income taxes | 18,828 | 17,351 | ||||||
| Accrued income taxes | 22,410 | 22,812 | ||||||
| Pension and other long-term liabilities | 50,151 | 58,985 | ||||||
| Commitments and contingencies | ||||||||
| Shareholders' equity | 1,606,511 | 1,599,901 | ||||||
| $ | 2,325,876 | $ | 2,188,935 | |||||
| (1) Amounts have been adjusted for the reclassification of goodwill and intangible assets related to business acquisitions made in December 2012. |
| FLIR SYSTEMS, INC. | ||||||||||||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||||||
| (In thousands)(Unaudited) | ||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||
| September 30, | September 30, | |||||||||||||||||
| 2013 | 2012 | 2013 | 2012 | |||||||||||||||
| As Adjusted(1) | As Adjusted(1) | |||||||||||||||||
| Cash flows from operating activities: | ||||||||||||||||||
| Net earnings | $ | 46,486 | $ | 55,905 | $ | 148,280 | $ | 145,137 | ||||||||||
| Income items not affecting cash: | ||||||||||||||||||
| Depreciation and amortization | 14,876 | 14,843 | 44,978 | 44,859 | ||||||||||||||
| Deferred income taxes | (64 | ) | 504 | (38 | ) | 599 | ||||||||||||
| Stock-based compensation arrangements | 7,347 | 6,598 | 20,673 | 19,997 | ||||||||||||||
| Other non-cash items | 2,061 | 507 | 1,485 | (1,864 | ) | |||||||||||||
| Changes in operating assets and liabilities, net of acquisitions | (18,178 |
) | (31,917 |
) | 34,413 |
(36,057 |
) | |||||||||||
| Cash provided by operating activities | 52,528 | 46,440 | 249,791 | 172,671 | ||||||||||||||
| Cash flows from investing activities: | ||||||||||||||||||
| Additions to property and equipment, net | (13,706 | ) | (12,759 | ) | (36,997 | ) | (39,188 | ) | ||||||||||
| Business acquisitions, net of cash acquired | (14,908 | ) | - | (20,073 | ) | - | ||||||||||||
| Other investments | - | - | - | (3,000 | ) | |||||||||||||
| Cash used by investing activities | (28,614 | ) | (12,759 | ) | (57,070 | ) | (42,188 | ) | ||||||||||
| Cash flows from financing activities: | ||||||||||||||||||
| Proceeds from long term debt | - | - | 150,000 | - | ||||||||||||||
| Repayments of long term debt | (3,750 | ) | - | (7,500 | ) | - | ||||||||||||
| Repurchase of common stock | (16,219 | ) | (38,809 | ) | (133,049 | ) | (129,010 | ) | ||||||||||
| Dividends paid | (12,786 | ) | (10,537 | ) | (38,695 | ) | (32,020 | ) | ||||||||||
| Proceeds from shares issued pursuant to stock- based compensation plans | 2,067 |
1,462 |
5,953 |
7,117 |
||||||||||||||
| Excess tax benefit of stock options exercised | 459 | 679 | 928 | 1,231 | ||||||||||||||
| Other financing activities | (306 | ) | 2 | (1,273 | ) | (139 | ) | |||||||||||
| Cash provided (used) by financing activities | (30,535 | ) | (47,203 | ) | (23,636 | ) | (152,821 | ) | ||||||||||
| Effect of exchange rate changes on cash | 6,387 | 8,240 | 1,375 | 5,981 | ||||||||||||||
| Net increase (decrease) in cash and cash equivalents | (234 | ) | (5,282 | ) | 170,460 | (16,357 | ) | |||||||||||
| Cash and cash equivalents, beginning of period | 492,433 | 429,771 | 321,739 | 440,846 | ||||||||||||||
| Cash and cash equivalents, end of period | $ | 492,199 | $ | 424,489 | $ | 492,199 | $ | 424,489 | ||||||||||
| (1) Amounts have been adjusted to conform to the presentation as of September 30, 2013. |
| FLIR SYSTEMS, INC. | ||||||||||||||||
| REVENUE AND EARNINGS FROM OPERATIONS BY SEGMENT | ||||||||||||||||
| (In thousands)(Unaudited) | ||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||
| September 30, | September 30, | |||||||||||||||
| 2013 | 2012 | 2013 | 2012 | |||||||||||||
| REVENUE - EXTERNAL CUSTOMERS | ||||||||||||||||
| Thermal Vision and Measurement | $ | 177,101 | $ | 149,540 | $ | 519,452 | $ | 447,922 | ||||||||
| Raymarine | 35,800 | 31,659 | 127,087 | 125,443 | ||||||||||||
| Surveillance | 102,966 | 115,915 | 331,824 | 350,005 | ||||||||||||
| Detection | 13,103 | 15,401 | 40,016 | 50,467 | ||||||||||||
| Integrated Systems | 29,171 | 19,715 | 77,674 | 45,136 | ||||||||||||
| $ | 358,141 | $ | 332,230 | $ | 1,096,053 | $ | 1,018,973 | |||||||||
| EARNINGS (LOSS) FROM OPERATIONS | ||||||||||||||||
| Thermal Vision and Measurement | $ | 43,744 | $ | 42,916 | $ | 125,509 | $ | 109,651 | ||||||||
| Raymarine | 2,050 | 374 | 14,345 | 9,944 | ||||||||||||
| Surveillance | 30,535 | 39,243 | 100,835 | 114,965 | ||||||||||||
| Detection | 1,354 | 1,131 | 3,265 | 801 | ||||||||||||
| Integrated Systems | (97 | ) | 1,333 | 112 | 1,267 | |||||||||||
| Other | (14,047 | ) | (10,760 | ) | (41,124 | ) | (33,375 | ) | ||||||||
| $ | 63,539 | $ | 74,237 | $ | 202,942 | $ | 203,253 | |||||||||
Contact Information:
Company Contact:
Shane Harrison
+1 503.498.3547
www.flir.com