FLIR Systems Announces Second Quarter 2013 Financial ResultsSecond Quarter Revenue and EPS Increase 15% and 30%, Respectively; Record Quarterly Cash Flow From Operations
PORTLAND, OR -- (Marketwired - July 25, 2013) - FLIR Systems, Inc. (NASDAQ: FLIR) today announced financial results for the second quarter ended June 30, 2013. Revenue was $389.3 million, up 15% compared to second quarter 2012 revenue of $338.3 million. Operating income in the second quarter increased by 16% to $70.3 million and net income increased 22% to $50.2 million. Second quarter earnings per diluted share were $0.35, an increase of 30% compared to the second quarter a year ago. Cash provided by operations in the second quarter was $134.3 million and represented a quarterly record.
Revenue from the Company's Commercial Systems division increased 17% from the second quarter of 2012, to $221.8 million. Within the Commercial Systems division, revenue from the Thermal Vision and Measurement segment was $175 million, an increase of 23% from the second quarter results last year. The Raymarine segment contributed $46.9 million of revenue during the second quarter, down 1% from the prior year.
Revenue from the Company's Government Systems division increased 13% from the second quarter of 2012, to $167.5 million. Within the Government Systems division, revenue from the Surveillance segment was $118.6 million, a decrease of 1% from the second quarter of 2012. Revenue from the Detection segment was $14.4 million, a decrease of 9% compared to the second quarter of 2012. The Integrated Systems segment contributed $34.5 million of revenue during the second quarter, an increase of 160% from the prior year as a result of deliveries under the MSC program to U.S. Customs and Border Protection.
The Company's backlog of firm orders for delivery within the next twelve months was approximately $528 million as of June 30, 2013, an increase of $23 million during the quarter and $30 million from a year ago. Backlog in the Government Systems division was $339 million, increasing $5 million during the quarter and over the prior year. Backlog in the Commercial Systems division was $190 million, an increase of $18 million during the quarter and $25 million over the prior year.
"We saw solid growth in revenue, operating income, cash flow, and earnings per share in the second quarter, and increased backlog in both divisions," noted Andy Teich, President and CEO of FLIR. "We introduced several new products during the quarter, with more on the horizon. I am very excited about our future given our market presence, product suite, and ability to execute for our customers and our shareholders."
Revenue and Earnings Outlook for 2013
Based on financial results for the first six months of 2013 and the outlook for the remainder of the year, FLIR is reaffirming its outlook for revenue and earnings per share for the full year 2013. Management expects revenue for 2013 to be in the range of $1.5 billion to $1.6 billion and net earnings to be in the range 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 September 6, 2013, to shareholders of record as of close of business on August 19, 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 Upcoming Events link at the Investor Relations page of www.FLIR.com. A replay will be available after 11:00 a.m. ET (8:00 a.m. PT) at this same Internet address. Summary second quarter and historical financial data, including segment details, may be accessed online from the Summary Financial Data section of 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 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 Six Months Ended
June 30, June 30,
-------------------- --------------------
2013 2012 2013 2012
--------- --------- --------- ---------
Revenue $ 389,329 $ 338,291 $ 737,912 $ 686,743
Cost of goods sold 199,288 168,262 363,884 333,988
--------- --------- --------- ---------
Gross profit 190,041 170,029 374,028 352,755
Operating expenses:
Research and development 39,601 37,510 76,285 74,080
Selling, general and
administrative 80,168 71,798 158,341 149,658
--------- --------- --------- ---------
Total operating expenses 119,769 109,308 234,626 223,738
Earnings from operations 70,272 60,721 139,402 129,017
Interest expense 3,767 2,768 6,664 5,834
Interest income (274) (377) (465) (805)
Other expense (income), net 175 240 (589) (984)
--------- --------- --------- ---------
Earnings from continuing
operations before income
taxes 66,604 58,090 133,792 124,972
Income tax provision 16,446 15,685 31,998 33,742
--------- --------- --------- ---------
Earnings from continuing
operations 50,158 42,405 101,794 91,230
Loss from discontinued
operations, net of tax - (1,312) - (1,998)
--------- --------- --------- ---------
Net earnings $ 50,158 $ 41,093 $ 101,794 $ 89,232
========= ========= ========= =========
Basic earnings per share:
Earnings from continuing
operations $ 0.35 $ 0.28 $ 0.71 $ 0.59
Discontinued operations - (0.01) - (0.01)
--------- --------- --------- ---------
Basic earnings per share $ 0.35 $ 0.27 $ 0.71 $ 0.58
========= ========= ========= =========
Diluted earnings per share:
Earnings from continuing
operations $ 0.35 $ 0.27 $ 0.70 $ 0.58
Discontinued operations - (0.01) - (0.01)
--------- --------- --------- ---------
Diluted earnings per share $ 0.35 $ 0.27 $ 0.70 $ 0.57
========= ========= ========= =========
Weighted average shares
outstanding:
Basic 142,085 153,172 143,350 153,829
========= ========= ========= =========
Diluted 143,774 155,033 144,981 155,983
========= ========= ========= =========
FLIR SYSTEMS, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)(Unaudited)
June 30, December 31,
2013 2012
------------- -------------
As
ASSETS adjusted(1)
Current assets:
Cash and cash equivalents $ 492,433 $ 321,739
Accounts receivable, net 278,265 335,163
Inventories 364,671 381,378
Prepaid expenses and other current assets 102,530 96,006
Deferred income taxes, net 30,953 30,960
------------- -------------
Total current assets 1,268,852 1,165,246
Property and equipment, net 216,855 211,615
Deferred income taxes, net 31,826 32,223
Goodwill 558,281 560,784
Intangible assets, net 162,806 175,888
Other assets 47,896 41,377
------------- -------------
$ 2,286,516 $ 2,187,133
============= =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 89,797 $ 94,156
Deferred revenue 26,715 29,465
Accrued payroll and related liabilities 49,565 41,506
Accrued product warranties 13,638 13,169
Advance payments from customers 15,854 12,150
Accrued expenses 43,971 32,772
Other current liabilities 4,403 6,406
Accrued income taxes 5,914 11,943
Current portion long-term debt 15,000 -
------------- -------------
Total current liabilities 264,857 241,567
Long-term debt 379,799 248,319
Deferred income taxes 15,777 15,549
Accrued income taxes 22,398 22,812
Pension and other long-term liabilities 45,676 58,985
Commitments and contingencies
Shareholders' equity 1,558,009 1,599,901
------------- -------------
$ 2,286,516 $ 2,187,133
============= =============
(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 Six Months Ended
June 30, June 30,
---------------------- ----------------------
2013 2012 2013 2012
---------- ---------- ---------- ----------
Cash flows from operating
activities:
Net earnings $ 50,158 $ 41,093 $ 101,794 $ 89,232
Income items not affecting
cash:
Depreciation and
amortization 15,231 14,809 30,102 30,016
Deferred income taxes (18) 86 26 95
Stock-based compensation
arrangements 7,630 7,865 13,327 13,400
Other non-cash items (2,951) 4,056 (577) (1,350)
Changes in operating
assets and liabilities,
net of acquisitions 64,234 9,328 51,571 (5,162)
---------- ---------- ---------- ----------
Cash provided by operating
activities 134,284 77,237 196,243 126,231
---------- ---------- ---------- ----------
Cash flows from investing
activities:
Additions to property and
equipment, net (10,643) (13,494) (23,291) (26,429)
Business acquisitions, net
of cash acquired (5,165) - (5,165) -
Other investments - (3,000) - (3,000)
---------- ---------- ---------- ----------
Cash used by investing
activities (15,808) (16,494) (28,456) (29,429)
---------- ---------- ---------- ----------
Cash flows from financing
activities:
Proceeds from long term
debt 150,000 - 150,000 -
Repayments of long term
debt (3,750) - (3,750) -
Repurchase of common stock (8,469) (64,812) (116,830) (90,201)
Dividends paid (12,802) (10,700) (25,909) (21,485)
Proceeds from shares
issued pursuant to stock-
based compensation plans 2,706 4,780 3,885 5,656
Excess tax benefit of
stock options exercised 236 214 469 552
Other financing activities 74 (98) 54 (140)
---------- ---------- ---------- ----------
Cash provided (used) by
financing activities 127,995 (70,616) 7,919 (105,618)
---------- ---------- ---------- ----------
Effect of exchange rate
changes on cash (45) (8,522) (5,012) (2,259)
---------- ---------- ---------- ----------
Net increase (decrease) in
cash and cash equivalents 246,426 (18,395) 170,694 (11,075)
Cash and cash equivalents,
beginning of period 246,007 448,166 321,739 440,846
---------- ---------- ---------- ----------
Cash and cash equivalents,
end of period $ 492,433 $ 429,771 $ 492,433 $ 429,771
========== ========== ========== ==========
Company Contact:
Shane Harrison
+1 503.498.3547
www.flir.com
