Exhibit 99.1
 | NEWS RELEASE
Company Contact: Tony Trunzo +1 503.498.3547 www.flir.com |
FLIR Systems Reports Record Fourth Quarter and Full Year
2008 Financial Results
PORTLAND, OR - February 5, 2009 —FLIR Systems, Inc. (NASDAQ:FLIR) today announced financial results for the fourth quarter ended December 31, 2008. Revenue was $302.3 million, up 25% compared to fourth quarter 2007 revenue of $242.6 million. Operating income for the quarter was $88.1 million, up 40% from $62.9 million in the fourth quarter of 2007. Net income for the quarter was $65.3 million, or $0.41 per diluted share, compared with net income of $46.6 million, or $0.30 per diluted share, in the fourth quarter a year ago. Cash provided by operations during the quarter was $90.1 million.
Revenue from the Company’s Government Systems division increased 50% over the fourth quarter of 2007, to a record $172.0 million, driven by strength in airborne and land-based applications. Revenue from the Company’s Commercial Vision Systems division increased 12% over the fourth quarter of last year, to $42.4 million, reflecting strong growth in the security and surveillance market. Revenue from the Company’s Thermography division decreased 3% from the fourth quarter of last year, to $87.9 million. Excluding the effect of exchange rates, total Thermography revenue increased by approximately 3% in the quarter. The Extech Instruments and Cedip Infrared Systems acquisitions contributed approximately $13.2 million in Thermography revenue in the fourth quarter of 2008, compared with $5.4 million in the fourth quarter of 2007. Thermography unit volumes, excluding Extech and Cedip products, increased by 33% in the fourth quarter of 2008 compared to the fourth quarter of 2007.
Revenue for the year ended December 31, 2008 was $1,077.0 million, up 38% compared to $779.4 million for the year ended December 31, 2007. Operating income for 2008 was $284.5 million, up 48% from $191.8 million during 2007. Net income for 2008 was $203.7 million, or $1.28 per diluted share, compared with 2007 net income of $136.7 million, or $0.89 per diluted share. Cash provided by operations during the year was $218.3 million.
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FLIR Systems Reports Record Fourth Quarter and Full Year 2008
Financial Results
February 5, 2009
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The backlog of firm orders for delivery within the next twelve months was approximately $663 million at December 31, 2008, an increase of $13 million during the quarter, and an increase of $270 million, or 69% compared with backlog at December 31, 2007. Backlog in the Government Systems division was $552 million, up $5 million during the quarter, as demand remained strong across multiple product lines. Backlog in the Commercial Vision Systems division was $91 million, up $10 million during the quarter due primarily to strong demand for its security and surveillance product lines. Backlog in the Thermography division was $19 million, down $3 million during the quarter.
“We are very pleased with our financial performance in 2008, as we recorded our eighth straight year of record revenue, operating income and earnings per share, and achieved the highest operating income margin and cash flow from operations in the Company’s history,” noted Earl Lewis, President and CEO. “We are well positioned for continued growth, and each of our divisions remains focused on their core strategies. Our 2009 outlook anticipates continued growth in all three divisions, particularly our Government Systems and Commercial Vision Systems businesses, which are supported by strong backlogs. We have taken a more cautious outlook for Thermography due to expected weak economic conditions through 2009.”
Revenue and Earnings Outlook for 2009
FLIR also announced today that it expects net revenue in fiscal 2009 to be in the range of $1.2 billion to $1.25 billion, an increase of approximately 14% compared with 2008, and net earnings to be in the range of $1.40 to $1.47 per diluted share, an increase of approximately 12% compared with 2008. This guidance assumes slower revenue growth in the Thermography division than originally expected as a result of continued economic weakness, and assumes a tax rate for the year of 32% to 34%, and an average diluted share count of approximately 164 million shares.
FLIR Systems Reports Record Fourth Quarter and Full Year 2008
Financial Results
February 5, 2009
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Conference Call
FLIR has scheduled a conference call at 11:00 am EST today. A simultaneous webcast will be available from theInvestor Relationslink at www.FLIR.com. A replay will be available after 3:00 PM EST at this same internet address. For a telephone replay, dial (800) 642-1687, Conference ID #80367906 after 3:00 PM EST.
About FLIR Systems
FLIR Systems, Inc. is a world leader in the design, manufacture, and marketing of thermal imaging and stabilized camera systems for a wide variety of thermography and imaging applications including condition monitoring, research and development, manufacturing process control, airborne observation and broadcast, search and rescue, drug interdiction, surveillance and reconnaissance, navigation safety, border and maritime patrol, environmental monitoring and ground-based security. Visit the Company’s website 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 2009” 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 US 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.
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FLIR SYSTEMS, INC.
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)(Unaudited)
| Three Months Ended December 31, | Twelve Months Ended December 31, | |||||||||||||||
| 2008 | 2007 | 2008 | 2007 | |||||||||||||
Revenue | $ | 302,349 | $ | 242,634 | $ | 1,076,974 | $ | 779,397 | ||||||||
Cost of goods sold | 128,862 | 105,395 | 470,832 | 346,167 | ||||||||||||
Gross profit | 173,487 | 137,239 | 606,142 | 433,230 | ||||||||||||
Operating expenses: | ||||||||||||||||
Research and development | 21,668 | 20,835 | 89,964 | 72,458 | ||||||||||||
Selling, general and administrative | 63,740 | 53,540 | 231,687 | 168,940 | ||||||||||||
Total operating expenses | 85,408 | 74,375 | 321,651 | 241,398 | ||||||||||||
Earnings from operations | 88,079 | 62,864 | 284,491 | 191,832 | ||||||||||||
Interest expense | 2,107 | 2,681 | 8,987 | 10,230 | ||||||||||||
Other income, net | (10,756 | ) | (5,016 | ) | (19,383 | ) | (9,551 | ) | ||||||||
Earnings before income taxes | 96,728 | 65,199 | 294,887 | 191,153 | ||||||||||||
Income tax provision | 31,404 | 18,602 | 91,154 | 54,442 | ||||||||||||
Net earnings | $ | 65,324 | $ | 46,597 | $ | 203,733 | $ | 136,711 | ||||||||
Net earnings per share: | ||||||||||||||||
Basic | $ | 0.47 | $ | 0.34 | $ | 1.47 | $ | 1.02 | ||||||||
Diluted | $ | 0.41 | $ | 0.30 | $ | 1.28 | $ | 0.89 | ||||||||
Weighted average shares outstanding: | ||||||||||||||||
Basic | 139,679 | 136,224 | 138,490 | 134,244 | ||||||||||||
Diluted | 162,728 | 161,426 | 162,901 | 159,241 | ||||||||||||
FLIR SYSTEMS, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)(Unaudited)
| December 31, 2008 | December 31, 2007 | |||||
ASSETS | ||||||
Current assets: | ||||||
Cash and cash equivalents | $ | 289,442 | $ | 203,681 | ||
Accounts receivable, net | 239,183 | 203,371 | ||||
Inventories | 207,487 | 179,366 | ||||
Prepaid expenses and other current assets | 59,824 | 58,056 | ||||
Deferred income taxes, net | 16,566 | 11,033 | ||||
Total current assets | 812,502 | 655,507 | ||||
Property and equipment, net | 122,304 | 120,873 | ||||
Deferred income taxes, net | 5,047 | 2,237 | ||||
Goodwill | 225,685 | 176,230 | ||||
Intangible assets, net | 56,174 | 52,819 | ||||
Other assets | 22,195 | 16,650 | ||||
| $ | 1,243,907 | $ | 1,024,316 | |||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||
Current liabilities: | ||||||
Notes payable | $ | 4 | $ | 19,000 | ||
Accounts payable | 47,823 | 53,990 | ||||
Deferred revenue | 27,554 | 14,371 | ||||
Accrued payroll and related liabilities | 43,337 | 39,431 | ||||
Accrued product warranties | 7,826 | 6,594 | ||||
Advance payments from customers | 19,183 | 9,156 | ||||
Other current liabilities | 26,527 | 14,600 | ||||
Accrued income taxes | — | 3,752 | ||||
Current portion of long-term debt | 21 | 7 | ||||
Total current liabilities | 172,275 | 160,901 | ||||
Long-term debt | 190,318 | 207,889 | ||||
Deferred income taxes | 5,983 | 1,902 | ||||
Accrued income taxes | 5,697 | 4,295 | ||||
Pension and other long-term liabilities | 29,572 | 26,054 | ||||
Commitments and contingencies | ||||||
Shareholders’ equity | 840,062 | 623,275 | ||||
| $ | 1,243,907 | $ | 1,024,316 | |||