FLIR Systems Announces First Quarter 2011 Financial ResultsRevenue Up by 30%; Narrowing EPS Outlook for 2011
PORTLAND, OR -- (Marketwire - April 29, 2011) - FLIR Systems, Inc. (NASDAQ: FLIR) today announced financial results for the first quarter ended March 31, 2011. Revenue was $373.5 million, up 30% compared to first quarter 2010 revenue of $287.3 million. Operating income in the first quarter was $76.6 million, compared to $84.3 million in the first quarter of 2010, and was impacted by a lack of RAID shipments as well as acquisition-related charges. First quarter 2011 net income was $51.3 million, or $0.32 per diluted share, compared with net income of $55.9 million, or $0.35 per diluted share in the first quarter a year ago. Cash provided by operations in the first quarter was $62.4 million.
Revenue from the Company's Commercial Systems division increased 51% from the first quarter of 2010, to $194.6 million. Within the Commercial Systems division, revenue from the Thermal Vision and Measurement segment, made up of FLIR's former Thermography and Commercial Vision Systems ("CVS") businesses, was $144.1 million, an increase of 12% over the first quarter combined results of Thermography and CVS last year. Commercial Systems' Raymarine segment contributed $50.5 million of revenue during the quarter.
Revenue from the Company's Government Systems division increased 13% over the first quarter of 2010, to $178.8 million. Within the Government Systems division, revenue from the Surveillance segment, comprised of the legacy Government Systems business and the imaging and radars businesses acquired with the fourth quarter 2010 acquisition of ICx Technologies, Inc., was $149.9 million, a decrease of 5% from the first quarter of 2010 results of the Company's legacy Government Systems business. Revenues from Government Systems' other two new segments, Detection and Integrated Systems, which were created following the acquisition of ICx, were $17.9 and $11.1 million, respectively.
The Company's backlog of firm orders for delivery within the next twelve months was approximately $528 million at March 31, 2011, a decrease of $6 million during the quarter. Backlog in the Government Systems division was $360 million, decreasing $27 million during the quarter despite significant international order activity. Backlog in the Commercial Systems division was $168 million, up $21 million during the quarter, a result of successful new product introductions.
"This quarter showcased the diversified nature of the business and the resiliency of our company. We released innovative products during the quarter that resulted in order volumes that outstripped our production forecasts. As anticipated, our Government Systems division was impacted by slowed U.S. procurement, but executed well and worked diligently to position the businesses for continued growth. Overall, we performed as we had expected during the quarter, had excellent cash flow, and believe the balance of the year will show improved results," noted Earl Lewis, President and CEO of FLIR.
Revenue and Earnings Outlook for 2011
Based on financial results for the first three months of 2011 and the outlook for the remainder of the year, FLIR management is increasing its outlook for revenue and narrowing its outlook for earnings per share for the full year 2011. Management currently expects revenue for 2011 to be in the range of $1.7 billion to $1.75 billion and net earnings to be in the range of $1.70 to $1.75 per diluted share.
Dividend Declaration
FLIR's Board of Directors has declared a quarterly cash dividend of $0.06 per share on FLIR common stock, payable June 10, 2011, to shareholders of record as of close of business on May 20, 2011.
Conference Call
FLIR has scheduled a conference call at 11:00 AM ET today. A simultaneous webcast will be available from the Investor Relations link at www.FLIR.com. A replay will be available after 2:00 PM ET at this same internet address. For a telephone replay, dial (800) 642-1687, Conference ID #56026734 after 2:00 PM ET.
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 R. Lewis and the statements in the section captioned "Revenue and Earnings Outlook for 2011" 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 March 31,
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2011 2010
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Revenue $ 373,465 $ 287,298
Cost of goods sold 177,820 121,944
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Gross profit 195,645 165,354
Operating expenses:
Research and development 37,260 24,803
Selling, general and administrative 81,739 56,208
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Total operating expenses 118,999 81,011
Earnings from operations 76,646 84,343
Interest expense 350 1,224
Interest income (262) (254)
Other expense (income), net 845 (53)
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Earnings from continuing operations before income
taxes 75,713 83,426
Income tax provision 23,849 27,531
--------- ---------
Earnings from continuing operations 51,864 55,895
Loss from discontinued operations, net of tax (549) --
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Net earnings $ 51,315 $ 55,895
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Basic earnings per share:
Earnings from continuing operations $ 0.33 $ 0.37
Discontinued operations (0.00) --
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Basic earnings per share $ 0.32 $ 0.37
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Diluted earnings per share:
Earnings from continuing operations $ 0.32 $ 0.35
Discontinued operations (0.00) --
--------- ---------
Diluted earnings per share $ 0.32 $ 0.35
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Weighted average shares outstanding:
Basic 159,400 152,899
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Diluted 162,310 161,604
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FLIR SYSTEMS, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)(Unaudited)
March 31, December 31,
2011 2010
------------ ------------
ASSETS
Current assets:
Cash and cash equivalents $ 250,229 $ 193,137
Accounts receivable, net 321,769 339,723
Inventories 321,072 303,156
Prepaid expenses and other current assets 106,006 95,663
Deferred income taxes, net 23,364 23,128
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Total current assets 1,022,440 954,807
Property and equipment, net 185,063 189,119
Deferred income taxes, net 22,746 22,742
Goodwill 492,431 482,019
Intangible assets, net 178,760 177,385
Other assets 32,519 31,280
------------ ------------
$ 1,933,959 $ 1,857,352
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 85,352 $ 85,881
Deferred revenue 19,790 17,867
Accrued payroll and related liabilities 46,126 54,894
Accrued product warranties 15,888 15,711
Advance payments from customers 21,700 22,616
Accrued expenses 32,325 36,578
Accrued income taxes 12,683 8,218
Other current liabilities 4,632 8,186
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Total current liabilities 238,496 249,951
Deferred income taxes 13,787 13,163
Accrued income taxes 22,197 19,793
Pension and other long-term liabilities 56,763 51,897
Commitments and contingencies
Shareholders' equity 1,602,716 1,522,548
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$ 1,933,959 $ 1,857,352
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Company Contact:
Shane Harrison
+1 503.498.3547
www.flir.com
