OSIS - Earnings call transcript Q1 2019

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Operator

Good day, ladies and gentlemen. Welcome to the OSI Systems Incorporated First Quarter 2019 Conference Call. At this time, all participants are in a listen-only mode. Later, we'll conduct a question-and-answer session, and instructions will follow at that time. [Operator Instructions] As a reminder, this call maybe recorded. to Financial host Officer. like Alan today’s now Chief Edrick, would introduce for your conference, I Please ahead, go sir.

Alan Edrick

President OSI Well, thank with to I’m Vice the us. you Deepak for CFO you. Good and fiscal afternoon Alan and Chopra, our OSI Edrick, CEO. here Systems And I’m Systems. thank President joining and today of Welcome Executive a participant XXXX press results. today, anyone who to a warm first quarter welcome fiscal Earlier our conference announcing calls. call. a release We on first-time XXXX would we financial conference issued like to extend quarter our is first

of statements risks, in results, tax current that the be information filed date like of company expected statements on including be are to factors Private results earnings speak contains wishes operating Such and this subject based deemed Act otherwise. forward-looking Reform actual its untrue statements no forward-looking because enacted subsequent our are or should may discuss call. periodic made numerous we company’s the regarding the company’s of without statements or under only with to Securities the Undue company today’s statements uncertainties, connection call, that forward-looking on All of events of conference factors, as legislation. remind performance take discussion time-to-time. advantage operational based currently financial and Before regarding from on and to this Litigation statements. on from with the forward-looking statement information as company’s control. the any the forward-looking In statements include call update laws. XXXX I’d SEC obligation that new And provisions reports becomes of to undertakes to limitation, and of recently expectations and are this materially These company revenues, everyone outside of respect reliance the forward-looking of assumptions are the the and available be information the forward-looking Harbor the to contingencies, divisions; expected growth; and described could management’s securities with to the effects expectations which many due our not differ placed Safe

call, to both GAAP operating conference results. may of financial we the today’s measures During non-GAAP refer and company’s

For on GAAP and refer information quantitative please SEC release to of figures, to been regarding to the non-GAAP regarding exhibit our today’s has measures Form press and X-K. first XXXX measures comparable as a fiscal results, an current report those which furnished a quarter reconciliation

over and the Deepak call turning a first general fiscal the discuss the to company’s provide quarter. business high-level to overview Before operations, financial I’ll of

Security, record a driven first was revenues equipment $XXX related reported In Revenues Healthcare revenue X% and division year-over-year Security by revenues, of division Opto year-over-year by was revenue turnkey of increase. and This we our Opto we quarter First, sales divisions. the by QX and year-over-year record partially increase offset driven million, $XXX cargo primarily of in which performance were reported million, growth year-over-year, XX% decrease with acquisition growth. increased and of combination the security offset from reduction a current XX% in by a division intercompany contract. in Mexico staff the in expected revenues. Opto organic, partially our sales The revenue growth service

excluded in the the Earnings diluted share year QX light in basis, non-GAAP of $X.XX $X.XX same especially changes fiscal of of the as GAAP all of with expense, to tax strong, amortization of comparison non-cash acquired softer in the of prior were departure intangible interest quarter the prior compared period. per effects. sales assets in the year Security related difficult $X.XX as of the a restructuring to the charges, from detection we of and of and a On costs, Department items. non-GAAP QX $X.XX last Second, and as discrete trace other of compared explosive EPS 'XX. Homeland tax QX result prior year was earnings share the contract Healthcare. net legal EPS point fiscal Mexico well certain earnings It reported XXXX including in QX per benefit share diluted diluted impact also excluded to per program

Third, ratio first finally, XXXX gross margin the was improved years. to highest X.X. QX, gross eight And margin in book-to-bill fiscal XX%, the quarter the quarter in

billion, over of a as XX% and Our the XXXX, figure backlog an sequential increase as XX, XXXX, backlog $X.XXX was XX, September of X% approximately September of increase.

guidance, diving XXXX let and updated discussing me more our call our deeply results to the financial turn fiscal over Deepak. Before into

Deepak Chopra

Healthcare and division, revenue all into and strategic had a also. Alan, performance, approximately as bolstering on you, and of $XXX a revenue the we starting first The the performed double performance reported increase are we division's where and division's that growth Thank the in generated we security each its very started the for while small X% but half. over year digit division strong a second EPS quarter, 'XX strong revenues quarter operating with The of Way again completed acquisition. improve record prior optimistic trajectory million, financial margins, period. the an of The disappointing to Fiscal good will Security well, the Non-GAAP delivered you. with quarter. division and division bookings afternoon Manufacturing during backlog nice Optoelectronics

MSAT were for last in book-to-bill We non-turnkey million departure the experienced due the bookings growth, $XXX Mexico, which trace division. the of Europe international the which U.S. Security after bookings a announced for highlights larger the disclosed million are we Shortly Homeland over explosive agencies. the quarter and much demand Breaking comp have over were further, and bookings quarter, infrastructure generated detection trace and reduced end, X.X previous of to a airport government of on the for the especially the calls, the performance as of Security this portfolio continue prior across products division. expand. the we A the of prior given transactions. few from product to tough border had ratio in of the stemming $XXX contract and program. the Department down Security of the for few a Bookings pleased strong efforts U.S. year with in in from of economics the both and point Security strong year security in very Asia

support for our another platform. from example, Customs units to mobile U.S. ZBZ contract delivery and million and inspection For from government systems. for base government our vehicle million screening a a inspection order vehicle and customer agency systems, the installed order service $XX equipment A $XX of million of Z-Portalcargoand cargo for maintenance $XX multiple and another to provide Border

baggage. trace inspection part to which detectors demographic an carry-on This order prisons In the other locations other of computed for airport. the systems operate military detection to of airports, airport a includes base products securing Return XXXCT, XXXCT and that headquarters, during Systems, high borders include agency embassies, international addition located of activity and system airport larger profile metal contract become the expanding Highlighting folks order inspection we is checkpoint a near deployment and Australia, at examples where government for announced an explosive quarter, first is Tray the examples. among basis, our our Melbourne,

On certification and the ongoing. to expand baggage TSA RTT is base internationally check installed front, continues the

continue on the to update you will the of progress TSA We certification.

happy go gearing Rico, XXXX. and and we on Albania Our continue to require fiscal that announce and integrated perform in services two to in up to well Puerto support turnkey are we solutions contracts that are contracts live Mexico,

screening sporting this Our entertainment are to we provides to of technology efforts events provide to at increasing security security using slated venues and grow fiscal gaining for are several us believe grow. the an We also ample event in opportunity that security traction to sports for improve as demand year.

very for XXXX. and the strong remainder position opportunities us our near-term well fiscal of Going sales forward, security backlog the

the division, where onto fiscal the Moving XXXX. quarter declined compared QX sales XX%, first of Healthcare as to

challenges we are performance this on division. This focused in the quarterly But is working through disappointing.

our overall senior the expect on recent accessories improve leadership related our supplies focus changes the We and core and patient cardiology performance should combined operating marketplace. with of in narrowing us and positioning monitoring, products senior

The which backlog. finish division, strong outstanding where the prior been an robust had XX% improving a the revenues had margins. quarter, than in division we and including to higher year bookings with revenues intercompany Moving Optoelectronic with grew as Manufacturing this

talk is quarter, division start to in numerous strong an forward quarter, synergistic line, a second current in coming strong and their thank to product the take electronics is excited had Security the efforts about in Opto complementary and that future quarters. performance look our completed with Alan great to a questions. have I'm back year. which The near-term moment pleased also With we in our fiscal We I'd a robust with backlog detail opportunities the and believe all position Thank improve for of the the the are for before employees in Healthcare and our financial about QX. call the to the half going acquisition like over to a offerings. I'm that, XXXX, call and During during to Overall, of will opening pipeline. the you. it division to we hand the Edrick, the

Alan Edrick

Thank you, Deepak.

Now greater let's detail. first the for in review the fiscal financial quarter results

our strong by increased sales. and division QX inspection revenues of equipment X% growth in previously, QX 'XX, cargo by driven X% revenues of in fiscal increased 'XX by QX Security in As fiscal the mentioned from vehicle year-over-year.

our in sales as year-over-year our field revenue service in external grown, revenues optical ongoing circuit sensor In assemblies January reported acquired for level division. growth higher division as acquired addition, intercompany driven our as XX% sales, have and our well July both business also businesses was from 'XX, has by primarily installed The 'XX, division to strength Opto organic increased. in the flex base Security revenues and from and Security

Healthcare experienced divisions the QX in revenues Deepak continued period. same XX% challenges As to prior we of year compared the fell mentioned, as

improvement improvement compared margin years. efficiencies favorable in QX the This gross as by first driven year. division XX.X% sales margin a fiscal in of Healthcare XX.X% margin by result the product the QX countered mix focus and was in highest gross the as Again, of operating Opto well improved Our more was our decreased in profitable was product to lines. last in as as division, in on our our eight quarter were gross XX% improvements

fluctuate revenue mix among other on gross our based will on period-to-period margin factors. mentioned As from calls, previous

the well Security mentioned Moving QX growth two operating Opto up fiscal of to Opto due and the division due were expenses previously. added as from primarily support 'XX, to division as $X In the expenses million, SG&A acquisitions expenses.

prudently innovative of on division current success and our focused acquired to of from development, costs. remain amount businesses, products, prior R&D by QX We of consolidation which million post expenses and fiscal structure. of call. business. from improving in $XX.X de-emphasis view were year, quarter's our focus product of the last on investigations $X.X on divisions our the our million legal cost on from efficiencies in as due year QX acquisitions, down to of all vital were division primarily reductions Security acquisition This consisted and charges our 'XX. employee term operations million, associated we to $X.X continue long We and efficiencies in of managing in Healthcare litigation mentioned with and costs related as as as QX severance Restructuring well other anesthesia

Moving to taxes.

tax the of QX rate discrete fiscal of fiscal was in effective the items, of Excluding XX.X% XX.X% to in 'XX. 'XX tax QX company's compared impact

During September tax XX.X%. compensation rate in resulting based discrete under the equity recognized $X.X ended of we've tax a for million of 'XX, months effective X an ASU-XXXX-XX XX, benefit

charge approximate rate an tax three effective XX, recognized the we've ended During $XXX,XXX net XX.X%. in tax discrete months September of resulting XXXX, an

offset 'XX, turn X.X% non-GAAP operating in adjusted earlier adjusted non-GAAP margin discussion from items in to factors, of in resulted in margin, division QX decreased division, call. slightly of was which This expansion division. QX excludes mentioned now Healthcare reduced operating 'XX. down partially Mexico to X.X% the margin revenues, company's fiscal the Security fiscal and among Opto in The losses, Let's operating our of by a due margin the contract from decrease the other

the shipments of of million higher used announced million, 'XX. $X.X expenditures Cash of in and inventories days took Moving XX fiscal over impacted flow operating certain the we expected cash turnkey QX was paid to timing to opportunities, taxes were by fiscal collections. cash advantage quarter while fiscal $X.X fiscal earlier, to a flow. as was we sales of remainder depreciation 'XX, or days DSO, QX in day's year, the year outstanding DSO compared amounts to flow. buildup repatriation pertaining as and $XX.X of Deepak the included In 'XX, of XX in of amortization due support million. customer we to and Capital program new which QX was in referenced 'XX last

Our balance to our net We turning with finally the ended approximately quarter strong. guidance. And of sheet remains leverage X.X.

to to fiscal diluted of earnings our year raising -- interest $X.XX expense And per through are diluted tax non-GAAP year EPS range effects $X.XX other range $X.XXX non-cash share fiscal to guidance and share assets a our we non-GAAP associated discrete excludes billion restructuring charges items. increasing guidance tax and billion. sales are amortization, XXXX and acquired and This $X.XX. XXXX and We intangible per their

reasonable known to believe SEC evolving sales reflect be Actual however, tax earnings, include timing making readiness our tax rate rate, to or risks updated our on these and anticipated continue in The division affecting due vary and more strategic impact intangible our while effective beyond of acceptance new development uncertainties, our as ranges each government of with in is of which items such for risks and filings. estimates. in specifically is and selective from derived and effective installations, and GILTI, known industries We the other will evaluate and uncertainties the information investing we product currently discussed control, provisions These as effect taxes is business complex. risks foreign and could earnings grow orders and the policies, product to generally income tax the and and as customer volatility low Additionally, Each we uncertainties including FDII. reform guidance and business, site analysis to We've the operate. subject the acquisitions. continued trade sales the significant associated available. our income in affecting tax of computations intangible global as

and And to to to call time, industries. like various would you Our our across questions. acquisition the products this investments products and enable call. continue at participating conference innovative our OSI solutions Thank role in leadership for with open we this

Operator

Drexel question from Ruttenbur first Thank Brian you. our [Operator Instructions] comes And with Hamilton.

Your now line open. is

Brian Ruttenbur

off of Thank for guidance? low expect the with questions very first in you very and much. all your start to quick rate, What quarter. Very guidance in housekeeping was we first the quarter. Couple of good your year, tax earnings in included what’s -- should

Alan Edrick

Yes, on $X.X the you're was the a was rate from effective Sure, comparable about at XX.X%, tax low basis This Brian. Alan. item. year, which tax is we benefit effective discrete exclude looking GAAP which to a pretty rate million our If so XX.X%. discrete includes items, last was

tax assumes guidance more our annual So rate less. that effective or

Brian Ruttenbur

Okay.

tax we what is So we for quarter roughly continue year? assume we rest out in see of that the the should should XX% then? Or this rate back kind this of

Alan Edrick

related Yes. onetime That But occurred. may that the that in year. There tends QX, of was to items largest item. those throughout the a discrete to occur particular further benefit be

XX% the we appropriate. using rate, believe will it So be

time. appropriate to rate. opportunities We think tax point continue that this to evaluate at do effective planning tax in would But that be lower we use to

Brian Ruttenbur

related less certification? no some or to Is you this Can could I seasonal? idea. is And Okay. And to housekeeping a was then The R&D investment with another us just anything give Healthcare, there? year-over-year. -- this related the kind -- be of down amount on it it side. have RTT

Alan Edrick

on some Alan. our of Sure, last well. line. Brian. This then deemphasizing you to talked One, point you And that I'll take no mentioned year, really continued. spending so one in doing things. It's that anesthesia last is were related this anesthesia about from R&D like Healthcare, two recall we as longer year, product we as the at

our So in would healthcare a we R&D down bit. come see

opportunities trace post detection of be acquisition we We took of some consolidate and opportunities. advantage second gather saw further synergies, to would those and business. the The

Both the helpful us. Security things side. very bit So little that for of of down those type were our R&D drove of on a

Brian Ruttenbur

a Okay. And just on questions of then other housekeeping. couple

side, Healthcare the On to it continues be weak.

start You you the growth. expect actually up revenue When see the same do to made changes in those showing line?

Deepak Chopra

product monitoring said, the Brian, positive. on focused in should feel half the I also, said about We Deepak this and we and like in and changes and is supplies the here. be said that that speech the I second accessories. cardiology of my good some line

Alan Edrick

basis, half, than even before the second QX much expect we the would And anticipate stronger on certainly QX. being sequential we

Brian Ruttenbur

the year, a do to on XXXX anticipate as or fair? be Healthcare in Then your up year-over-year anticipating recover you're going Okay. in guidance, in down to you going basis? Or down on be is it's to what XXXX? that Is still

Alan Edrick

Yes.

So we in quarter. saw that, which only basis. company performance anticipating provide the division Healthcare first out the much guidance overall we on of than an But are we stronger

Brian Ruttenbur

just a about Middle Okay. exposure, that. of that a and seeing Middle issues that Saudi products. And Can questions like Arabia Saudi I of been questions, East, you about a your stop. of in specifically Middle seeing [indiscernible]. maybe couple exposure there the other folks East and any companies you're kind lot quick then in or slowdown bit lot has know fire little I'll you're of talk is to a that East of

Deepak Chopra

Brian, here. this is Deepak

We seen you that is is in a our But perspective, broad. if places. reach always We and it look of at of total a line activity. global some anything. world. is some there the haven't at And product so there lot look world, part In turmoil geographic from the our

see anything Some move places into are all opportunities. Saudi. today We to at great don't

Brian Ruttenbur

services, final on Okay. field Alan. question And then,

on you give think fast. really services fast field that how some that of us hand that or growing around get Can our mentioned stride? our something I number we that's you percentage kind can

Alan Edrick

growth. really source been of a Yes, Brian. for nice Sure, -- it's been us it's

the been with products come base our increase a warranty, off past as has as over service result, revenues that. install increasing significantly And Our several years.

security field our service significant that with lines. revenues specific the throughout numbers, in and did point So different our really product we see growth

Brian Ruttenbur

to also? Europe Would that in RTT relate

Alan Edrick

of a part RTT in that. certainly Europe was

area. the saw cargo We it trace the also area, in in

Brian Ruttenbur

you. thank Okay,

Operator

from Jefferies. our Kahyaoglu Sheila question comes And with next

open. is now Your line

Sheila Kahyaoglu

and Alan, for afternoon, talk bit that you guess good what’s the about to a such and there, elaborate you strengths if you a and the on profitability. security little Hi, mix could thank I more, on time. driving bit

Alan Edrick

Sure, Sheila.

On the on profitability, or the sales?

Sheila Kahyaoglu

profitability the side. On

Alan Edrick

Yes.

products inspection has internationally, is team a related revenues our and other notable from especially and the the might that and really the bit. in But, the sales pipeline seen everybody sales. the the the growing both service efficiencies, the that. of the in of -- service Similarly bookings and growth explosive of light done perspective in and that. in go with really side. opportunities difficult that our security detection And resulting growing to a job comps, So the on supply outstanding it an cargo the and probably and And driving little teams The equipment profitability comes the I we've outstanding improve regard. and in parcels U.S. guess cargo profits team same job, hand that job the a hand it'll done equipment has and line of on have in systems continue really management business side done we're our chain achievement. realization Mexico, security the to side has on both opportunities comparable year pleased products, baggage looking for at year and the with top to having nice focused of over and have been related performance to on year last profits to improving At a other type an trace really the time,

bottom to think, question. line factor helped all a drive your together, So those I nice things really

Sheila Kahyaoglu

terms of, still adjusted sequentially on in an Mexico. XXX post are bps basis, your And margins up

-- is putting what’s just services quantifying seeing? driving it. that is your with they're But it? you’re am ways So amount growth near Or that that really I it coupled

Alan Edrick

and equipment that. growth, higher right. which operating to service absolutely, margin basic carries has revenue, non-turnkey You're margin partially therefore and revenue sale, contributed gross The a absolutely generally service

So you’re absolutely right.

Sheila Kahyaoglu

timing, then more? And little on we flow, just a of from here, cash improves if free cadence extend the could can bit the just talk on what growth if you that about it's

Alan Edrick

Sure.

was free And off light. part little cash in bit that of inventories. here in the flow increase fiscal reason of big very was strong multifaceted. was that for 'XX, a coming QX the A So a

that's our QX, we all really that So have to buildup the we QX sell to large the quite inventories and geared increased substantially, into and backlog head as QX.

was slower saw that collections. We little bit all customer a anticipated. So

DSO. had higher we a So bit

build Going down. great cash in up forward, for we of free think burned inventory because some that flow there's be will opportunity

DSO we So have profitability we’ll generally on our then faster do we QX, we’ll and improve day's collections, than inventory, in some our QX, higher in improve QX.

we anticipate would really flow cash will that So our gear to. up

had to on in of some but going beneficial to initiatives residual we some a to payments. that we there repatriation the fiscal that from executed company, QX, In the we XXXX the had of those in effect we're timing that addition, taxes was just lag pay

Sheila Kahyaoglu

one then, I so last and just And can. if one,

booked million in terms In $XXX that quarter. the of that bookings securities within you

I U.S. expand think is $XXX Is could you -- If from on pickup mentioned that U.S. What's You the that agencies? budget the a driving agencies. from million driven? that.

Deepak Chopra

for new Well additional year this But is September some mention government of been are us, is a the of not very are Deepak. that service, definitely this the also the happy some total that does bookings, good proud them for we've These U.S. very, for to a government, for of more we help. are on budget them are the is And, time. and as to long them so products, world that And say related to security. focused U.S. end year-end had has international. and initiatives customers some

Operator

our question comes CJS from And Larry next Solow with Securities.

now is line Your open.

Larry Solow

thanks. Great,

a of couple clarifications. Just

the Non-GAAP on on for take tax actually, benefit, you quarter, right, On Alan, the out you EPS, adjustment, the the rates.

XX% So effective is unchanged that that you're correct? rate using

Alan Edrick

That's correct the We're XX%. not We're using the XX%. Larry. using

Larry Solow

improve? gives What the that that what extraordinary, DSOs one then will sort up bit of particular, And Okay. little thing on a a mentioned in the gives you went more bit, the you sort of as little that collection. you confidence

Alan Edrick

of pickup saw continue And in August September. international the already of typical we've which October. been Yes, the we based necessarily discussions particularly that the a upon is December. the vacations in some will having, that slowdowns some some not seen November summer, and of in we anticipate and just during in We've certain collections customers, during periods

improvement we believe see in an DSO. we our So will

Larry Solow

doesn't Okay. headwind of geopolitical up impacted rising Why of was this guys you [indiscernible] of sort the the know any area at all? particular term. perception in outside short Saudi brought U.S.? been risk the I And have in Is risks there question there sort were, of that any

Deepak Chopra

This is Again, Larry. if Deepak broad. focused here, at is somewhere. we something But so business answer my look all there our globally it on that is happens is very it

broad. Our customer base so is

I Our us. global think broad is reach so don't that that there is for any alarm

Larry Solow

Security, on bookings Any that's And particular obviously, been the of it strength like the any leader lagging Deepak, broad area seems pretty and have few conversely strong area really side? last or quarters, been is seems sort the one base. security that the

Deepak Chopra

has for weak, of on has side, it's kind it's it's very is of the the believe, in news, that the including be over to focal continue know, trace last rest you one is of everybody all you stuff that for the Security But been good is there over products, America to thing. cargo have been the the increase. years. RTT, cargo. going in the U.S. in and that area weak couple of space have The one been international what has There that last time. some days. standard we reason. both the the I it's If Latin to couple with point world, the no

a fact. that's a say, that's but Now thing to sad

Larry Solow

Absolutely.

the think, going will two services. I said integrated live you contracts are that that, mentioned You require

hybrid million contract Is called other you announced of in correct? last this year. what August is? you And $XX was one them one could then the so tell us of that Just

Deepak Chopra

services small is other mentioned which, true that's this going that year and CapEx quarter. International. also is we’ll some what Alan integrated contract the this That live, one you a mentioned. for is That put just And also contract --

Larry Solow

Okay.

not over On helped of second there. - Has years, operating these bit sustainable? result. color the it looks and of any like but Or, realize I number margin been it few Opto back It there's the quarterly highest, on by circled one is highest the sort guess, the last quarterly of side, a I of some that? really good this volatility, acquisitions. little highest

Alan Edrick

Alan. Yes, question. Good Larry this is

the mix. strong margin You're sales operating can type we the It's higher margins. But operating that up very of done strong have continue absolutely very higher contributed gross We’ll business, some leading some believe associated always numbers. quality with with right. the to business volatility margins. to to to margin continue put see operating been margins recently that acquisitions higher have expanding of And

So the shifting a the from margin what operating business continuing and to a margin really of top-line done business some job, higher had away we years expansion. growth of the leveraging to has top-line, to lower business, margin ago grow the few nice and that in

Larry Solow

Okay.

Just lastly on the Healthcare piece.

here, what confidence or sort confidence discuss that confidence Or you that macro? see the back sort anesthesia of worse a of parts But no a sort that almost surprise visibility? efforts bit bit half? had think, some gives the you of you'll of the the -- -- we you What Can I will in maybe directionally -- of that are little Thanks. a little the there, complete? than businesses of gives perhaps rebound thought. have gives you you what has exit the

Deepak Chopra

Larry, but is it's anesthesia, delighted been here. not have been this Bottom-line Deepak in that a we success.

the we decided growing, it put we’re we also not known monitoring. call a And focus, patient mentioned I not that to before so for got this we said basically, it industry the last And conference to on want in and in on focus we because in was anesthesia that has focus, loss but call on that. Alan -- emphasize more And only the think, and making. also, focus,

more that to we believe all that ourselves, we we have the redirect we exit to decided and the we need redirection focus So business. that, that should and get

Healthcare As single you hand, growth know, is a the on digit other anyway.

after both have see time, in of to we capture the business. It us customers top. a both that into talents want it sale. accessories, even same some domestically front focus and good most internationally. at we just the we which can the on is of in And brought puts So the believe what and times At and new we supplies

focus So there, customers. new front we the of that grow that and to make that’s continues very the some because brought predictable of side want leadership long-term business in you business in a and to

Operator

Martin our comes Capital Jeff question next with Partners. from Roth And

Your line is now open.

Jeff Martin

Just and is board. want requiring you're to verify Those right? are the maintenance non-CapEx that contracts, on that service bringing contracts

Alan Edrick

of this is Jeff, contracts, One Alan. the

saw contracts of again so require with associated the the the you QX some does of in CapEx contract, that. was One turnkey to CapEx, that here

Jeff Martin

CapEx this front? expense has that And Okay. been at

Alan Edrick

been CapEx our part yes. That it's incurred, of is yes, --

Jeff Martin

larger been that elaborate about or And on this the you then, on like an think tractions, But quarters on, gaining now. you see could basis for know touch market you it And potentially? put to event that what overtime, timeframe over a I it annual long maybe couple talking the some you specifically you’ve don't but run, getting seems you on of year. the do security continues you're a opportunity? how do for

Deepak Chopra

Number I things, for is, number new I this very it. think that to the we like one but even we on it's always a market. -- that, is put But don't in of Yes. internal difficult kind have us targets obviously were a It's Olympics.

it requiring simple concerts would I repeatable at it I and focusing what looking securities, upgraded. smaller, what and called, stuff, on there is So more call sporting more we not a it these, were security, which would that predictable, events, service long-term and just guard upgraded

hands. to decided. try we went our going We're up. We're to So going

well Tournament. tennis industry the in we And this the received, concert, they the it or because there. whether of or people all football So was Senior name get lines it's a lot allowing or very just PGA or sponsorship it's for It out Golf basketball, whether it's together. whether whatever gets cruise did

believe to there. So platform technology to business. not security predictable. We ability we name out going showing will -- And to and call that I what more million It's show with our make that name a there a grow able safer headroom. our and would more the $XXX become our that make -- are to some think we

believe be if will it's too to -- early take XXs, the into XXs, will we it great it think it I a for business we but say, that us. can

Jeff Martin

all in there your Are as made perhaps acquisition that's segments and Could opportunities you acquisitions not three you've and at enough. Okay, Healthcare on helpful. much? strategy? But, looking touch

standpoint thinking you're I just what helpful. will of So bigger from be a kind picture

Deepak Chopra

what going our business us in one not call And reach, -- The tend the the to will bit turnkey, The put as customers product expansion. anything they focused we In product Opto to then, think, we we line the technology in very be answer little it's acquisitions. Are more? And do. two look line we -- be we’re our a have on much strategic, we're opportunities. going side. to where going at could be already it's their I we’re than add at things not to with broader are doing. synergistically their we some in going the synergistic do the But, you are Well, a of to whether that of share broadening broaden to our whether more We're but us. manufacturing can Security speak turnkey, globally side, we see to to in to it done offer a we is, sporting looking we would or to smaller, they that stuff in been on picture have we customers more it's acquisitions events, have whether cargo tend continue services we or take and that more good can inspection what I the always that. say have not for

Jeff Martin

you question Okay. the that view standpoint? on on do my from competitive Harris then How standpoint an And last also a opportunistic is merger. LX and

Deepak Chopra

people any the consequence with. begin other. that. Well, of to LX big one a lot don't us a way is see anything asked We have guy of

all don't any if at side. much Security [indiscernible] got the bigger. Harris or they So in have

So any on that don't side. synergy bring

business it usual. at look we So as

On the becomes a get other always hand, they look at and if their less they focus we important, -- when consolidate it. will this thus it, and finally together

Jeff Martin

were quarter? there stock Okay. And any in repurchases the then,

Alan Edrick

Yes, shares there were. We XXX,XXX stock repurchased of approximately the during quarter.

Operator

Josh question with Riley. from next comes our And Nichols B.

open. Your line now is

Josh Nichols

I the I was to you fall you expect of backlog? Really us layer that how multiple kind color on into bookings much numbers could over into Any Do roughly? kind strong revenue bookings as especially, these some of end. XXXX fiscal to question. years. of give my U.S. government, taking curious. quarter, ask of can like -- year for for was the with you thanks Yes, But going see especially,

Deepak Chopra

break it is specifics. here. on I This Deepak can’t

we of get orders add. upon that equipment in some all most to of the depending will plus for And of equipment. shipped Some have quarters. is want announced they the orders couple minuses, -- next the if Alan, you

all most time. is million the think I Alan? equipment Some maybe But the $XXX that stuff, contracts multi-years add-on that they is won’t related. mostly service of of on ready, service at are them happen and

Alan Edrick

the Sure, ship in Josh. Yes, both on as nice period, beyond of requirements. based 'XX fiscal certainly of customer well there's it that will abroad though ship and that the will bookings, portion aspects a U.S. in our

can of in be contracts nature. multi-year some addition, the In service

So fiscal be combination of beyond. will 'XX a and those

Josh Nichols

was on provide it's the of I do in far specifics some announced that checklist ask of as Any on that Healthcare so going some business. things? the you to to only for what since I - the what's you plan know a of Thanks. could quarter Or changes as going action been the been those items in date? to are and timeline kind of done some

Deepak Chopra

Focus, this I want about a been That’s it's what to quarter broken here. don’t - a added. Deepak something want we than more focus approximately. like - Again to record. Yes, are focus, is been is

We deemphasizing are anesthesia.

on have area, some about supply that faster the We things to We leadership features which and know want us, the is provide said business. I customers be added delivery, want, service make predictable needs which better they to there. to what more cardiology happy is that trying than chain, higher got sure new to it. our in that. our at a want to else And of partners that and on line, and make experience customers. We’re and focus to line. the to basically whatever we we to accessories And want have the and we product as And growth monitoring margin to stability. expand another Supplies happen,

Josh Nichols

then, work Middle for favorable security is And a impactful Thanks. have business? as Or business I security to I in oil is seeing you of noticed know, know business in historically, that you a prices as do the been generally East. kind diverse rise mentioned other really in people that incremental it thing the materially for benefit Is a small the the have that you company. the tailwind far more, bookings? that as you’re a

Deepak Chopra

all oil last wasn’t to Well, But obviously everything to places good. in just maintained of XX over East years oil Middle always are related when area, And generates protect liquidity, protect whatever of said what it and primary you been have referring ago, stopped. if you the all economies the you before, important assets But even the it, the is years, a prices of is if the superiority I XX it's countries. said time, couple generates I've your the in couple house. the for thing, all the that of dollars that to these important And currency. have because just these your their oil like I to thing

want to you So it. get

looking the we for for goal the solution what be after assets securing right that them. provide a wants to our long-term, is believe customer can So that solution their and

Josh Nichols

there of question but that to related really, really. is then, kind And check of screening last kind two me parts for

or us process process Anything for down approval shipment Europe. long takes for looks on TSA? could you're TSA seeing get you of been impact from do now then how way in the European from you XXXCT also, that's about approval what material tell that that your the So for RTTXXX. how approved the first can And sales? have to like One, that you think the order that first

Deepak Chopra

Well, sided you asked two questions.

the RTT, and On the the on first on not CT checkpoint. one,

Basically evolving are new watch. most how at, benefit We continue demos to much is see to an to trial looking customers this trying put they get.

it. on watching We are

even We have product successful. a

it. other and take we see game, a it's good of but be Everybody want wait it And, careful world. to owning is wants that the there. that how in We're a to just news deploying anyway grows doing and very customer. works. are demos parts are to The to view it how We we socket

TSA, can If the is the certification but in help can't So product, we are them RTTXXX it the there, on add see that of with the to and new commit goes. we where in when. we doors be final certification,

been think it to many saying for I that we go. have We've years.

I think year; we'll the fiscal certification. definitely this get

Operator

[Operator we Instructions] Drexel with Hamilton. follow-up a have do with Brian Ruttenbur And

Your is line open. now

Brian Ruttenbur

Yes.

follow-up. that had post million the quick the that Can It additional you bookings. that number? one you bookings amount Is you in Just the have quarter? of repeat was $XXX

Alan Edrick

quarter-end subsequent bookings QX, that Brian. was during made occurred to I think announcements what referring were Deepak was to for that

were bookings about in QX. $XXX total the million So

Brian Ruttenbur

bookings continued Okay. things be the progressed quarter? the of Are strong? How post end to

Alan Edrick

Yes.

Brian Ruttenbur

that? on elaboration Any Okay.

Deepak Chopra

it. You say know, I'm not to going

Operator

showing any conclude today's not I'm That And questions. does further question-and-answer session.

Deepak Chopra

joining to Well, for our everyone like thank I would you. thank call.

our happy of of fiscal the call. Thank We all in you forward to And very with QX, look are again the very much the beginning you. XXXX. you on speaking next to

Operator

participating Ladies This conference. in and you gentlemen thank today's program. today's for does conclude

all disconnect. may great everyone You a And day. have

OSI Systems (OSIS) 25 Oct 182019 Q1 Earnings call transcript