FLIR Systems Announces First Quarter 2014 Financial Results

FLIR Systems Announces First Quarter 2014 Financial Results 
WILSONVILLE, OR -- (Marketwired) -- 04/25/14 --  FLIR Systems, Inc.
(NASDAQ: FLIR) today announced financial results for the first
quarter ended March 31, 2014. Revenue was $351.5 million, up 1%
compared to first quarter 2013 revenue of $348.6 million. Operating
income in the first quarter was $42.5 million, compared to $69.1
million in the first quarter of 2013, and was impacted by $8.4
million in pretax charges related to previously-announced
restructuring initiatives. First quarter 2014 net income was $29.9
million, or $0.21 per diluted share, compared with net income of
$51.6 million, or $0.35 per diluted share in the first quarter a year
ago. The net after tax impact of the restructuring charges in the
first quarter was approximately $6.4 million, or $0.04 per diluted
share. Cash provided by operations in the first quarter was $59.8
million, a decrease of 3% compared to the first quarter of 2013.  
Revenue from FLIR's Surveillance segment was $117.2 million, a
decrease of 1% from the first quarter results last year. The
Instruments segment contributed $84.1 million of revenue during the
first quarter, up 7% from the prior year. The OEM & Emerging Markets
segment had $53.8 million of revenue, an increase of 7% over the
prior year. Revenue from the Maritime segment was $52.6 million, and
was up 4% over the first quarter of 2013. FLIR's Security segment
recorded revenue of $29.3 million in the first quarter, down 1% from
the prior year. The Detection segment contributed $14.6 million of
revenue, a decrease of 33% from the prior year. 
FLIR's backlog of firm orders for delivery within the next twelve
months was approximately $514 million as of March 31, 2014, an
increase of $24 million during the quarter.  
"Our first quarter results were in-line with our expectations.
Healthy growth in our commercial-oriented markets was offset by
declines in government-funded sectors. We continued executing on our
realignment plan, which we believe will be a valuable investment for
our long-term performance," said Andy Teich, President and CEO of
FLIR. "We expect continued improvement as we move throughout this
year and are excited about our product pipeline that is enabled by
our new Lept
on core." 
Revenue and Earnings Outlook for 2014
 Based on financial results for
the first three months of 2014 and the outlook for the remainder of
the year, FLIR is reaffirming its outlook for revenue and earnings
per share for the full year 2014. Management expects revenue for 2014
to be in the range of $1.45 billion to $1.55 billion and net earnings
excluding restructuring charges associated with the business
realignment to be in the range of $1.40 to $1.50 per diluted share.  
Dividend Declaration
 FLIR's Board of Directors has declared a
quarterly cash dividend of $0.10 per share on FLIR common stock,
payable June 6, 2014, to shareholders of record as of close of
business on May 20, 2014. 
Conference Call
 FLIR has scheduled a conference call at 11:00 a.m.
ET (8:00 a.m. PT) today to discuss its results for the quarter and
the year. A simultaneous webcast of the conference call may be
accessed online from a link in the Events & Presentations section of
www.FLIR.com/investor. A replay will be available after 2:00 p.m. ET
(11:00 a.m. PT) at this same Internet address. Summary first quarter
and historical financial data can be accessed online 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 systems and components are
used for a wide variety of thermal imaging, situational awareness,
and security applications, including airborne and ground-based
surveillance, condition monitoring, navigation, recreation, research
and development, manufacturing process control, search and rescue,
drug interdiction, transportation safety, border and maritime patrol,
environmental monitoring, and chemical, biological, radiological,
nuclear, and explosives (CBRNE) threat detection. For more
information, 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 2014" 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 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.  
(Tables Below) 


 
                                                                            
                                                                            
                             FLIR SYSTEMS, INC.                             
                     CONSOLIDATED STATEMENTS OF INCOME                      
            (In thousands, except per share amounts)(Unaudited)             
                                                                            
                                                        Three Months Ended  
                                                             March 31,      
                                                       -------------------- 
                                                          2014       2013   
                                                       ---------  --------- 
                                                                            
Revenue                                                $ 351,542  $ 348,583 
Cost of goods sold                                       183,010    164,596 
                                                       ---------  --------- 
    Gross profit                                         168,532    183,987 
                                                                            
Operating expenses:                                             
            
  Research and development                                36,326     36,684 
  Selling, general and administrative                     81,942     78,173 
  Restructuring expenses                                   7,813          - 
                                                       ---------  --------- 
    Total operating expenses                             126,081    114,857 
    Earnings from operations                              42,451     69,130 
                                                                            
Interest expense                                           3,708      2,897 
Interest income                                             (264)      (191)
Other income, net                                           (198)      (764)
                                                       ---------  --------- 
    Earnings from continuing operations before income                       
     taxes                                                39,205     67,188 
                                                                            
Income tax provision                                       9,311     15,552 
                                                       ---------  --------- 
    Net earnings                                       $  29,894  $  51,636 
                                                       =========  ========= 
                                                                            
Earnings per share:                                                         
  Basic                                                $    0.21  $    0.36 
                                                       =========  ========= 
  Diluted                                              $    0.21  $    0.35 
                                                       =========  ========= 
                                                                            
Weighted average shares outstanding:                                        
  Basic                                                  140,932    144,629 
                                                       =========  ========= 
  Diluted                                                143,828    146,291 
                                                       =========  ========= 
                                                                            
                                                                            

 
                                                                            
                                                                            
                             FLIR SYSTEMS, INC.                             
                         CONSOLIDATED BALANCE SHEETS                        
                          (In thousands)(Unaudited)                         
                                                                            
                                                     March 31,  December 31,
                                                       2014         2013    
                                                   ------------ ------------
                      ASSETS                                                
                                                                            
Current assets:                                                             
  Cash and cash equivalents                        $    584,095 $    542,476
  Accounts receivable, net                              270,165      286,573
  Inventories                                           338,894      344,719
  Prepaid expenses and other current assets              98,386       97,574
  Deferred income taxes, net                             38,660       38,389
                                                   ------------ ------------
    Total current assets                              1,330,200    1,309,731
                                                                            
Property and equipment, net                             232,904      234,041
Deferred income taxes, net                               18,079       17,883
Goodwill                                                574,007      575,701
Intangible assets, net                                  159,602      154,195
Other assets                                             52,359       51,808
                                                   ------------ ------------
                                                   $  2,367,151 $  2,343,359
                                                   ============ ============
                                                                            
       LIABILITIES AND SHAREHOLDERS' EQUITY                                 
                                                                            
Current liabilities:                                                        
  Accounts payable                                 $     91,965 $     85,730
  Deferred revenue                                       23,951       28,844
  Accrued payroll and related liabilities                60,370       62,069
  Accrued expenses                                       36,159       39,316
  Accrued income taxes                                      138          663
  Other current liabilities                              43,578 
      44,893
  Current portion long-term debt                         15,000       15,000
                                                   ------------ ------------
    Total current liabilities                           271,161      276,515
                                                                            
Long-term debt                                          368,892      372,528
Deferred income taxes                                    12,339       12,255
Accrued income taxes                                     20,763       19,996
Other long-term liabilities                              49,966       48,685
                                                                            
Commitments and contingencies                                               
                                                                            
Shareholders' equity                                  1,644,030    1,613,380
                                                   ------------ ------------
                                                   $  2,367,151 $  2,343,359
                                                   ============ ============
                                                                            
                                                                            
                                                                            
                                                                            
                             FLIR SYSTEMS, INC.                             
                   CONSOLIDATED STATEMENTS OF CASH FLOWS                    
                         (In thousands)(Unaudited)                          
                                                                            
                                                        Three Months Ended  
                                                             March 31,      
                                                       -------------------- 
                                                          2014       2013   
                                                       ---------  --------- 
                                                                            
Cash flows from operating activities:                                       
  Net earnings                                         $  29,894  $  51,636 
  Income items not affecting cash:                                          
    Depreciation and amortization                         16,470     14,871 
    Deferred income taxes                                   (235)        44 
    Stock-based compensation arrangements                  8,756      5,696 
  Other non-cash items                                    (1,564)     2,374 
  Changes in operating assets and liabilities, net of                       
   acquisitions                                            6,504    (12,662)
                                                       ---------  --------- 
Cash provided by operating activities                     59,825     61,959 
                                                       ---------  --------- 
                                                                            
Cash flows from investing activities:                                       
  Additions to property and equipment, net                (9,590)   (12,648)
                                                       ---------  --------- 
Cash used by investing activities                         (9,590)   (12,648)
                                                       ---------  --------- 
                                                                            
Cash flows from financing activities:                                       
  Repayments of long term debt                            (3,750)         - 
  Repurchase of common stock                              (1,766)  (108,361)
  Dividends paid                                         (14,085)   (13,106)
  Proceeds from shares issued pursuant to stock-based                       
   compensation plans                                      8,876      1,179 
  Excess tax benefit of stock options exercised            2,698        234 
  Other financing activities                                 252        (22)
                                                       ---------  --------- 
Cash used by financing activities                         (7,775)  (120,076)
                                                       ---------  --------- 
                                                                            
Effect of exchange rate changes on cash                     (841)    (4,967)
                                                       ---------  --------- 
                                                                            
Net increase (decrease) in cash and cash equivalents      41,619    (75,732)
Cash and cash equivalents, beginning of period           542,476    321,739 
                                                       ---------  --------- 
Cash and cash equivalents, end of period               $ 584,095  $ 246,007 
                                                       =========  ========= 
                                                                            
                                                                            
                                                                            
                                                                            
                             FLIR SYSTEMS, INC.                             
              REVENUE AND EARNINGS FROM OPERATIONS BY SEGMENT               
                         (In thousands)(Unaudited)                          
                                                                            
                                                        Three Months Ended  
                                                             March 31,      
                                                       -------------------- 
                                                          2014       2013   
                                                       ---------  --------- 
REVENUE - EXTERNAL CUSTOMERS                                                
  Surveillance                                         $ 117,201  $ 117,987 
  Instruments                                             84,056     78,550 
  OEM and Emerging Markets                                53,801     50,285 
  Maritime                                                52,575     50,462 
  Security                                                29,309     29,472 
  Detection                                               14,600     21,827 
                                                       ---------  --------- 
                                                       $ 351,542  $ 348,583 
                                                       =========  ========= 
                                                                            
EARNINGS (LOSS) FROM OPERATIONS                                             
  Surveillance                                         $  20,361  $  33,726 
  Instruments                                             20,450     20,024 
  OEM and Emerging Markets                                11,711     14,596 
  Maritime                                                 8,830      8,107 
  Security                                                 1,686      4,389 
  Detection                                               (1,800)     2,545 
  Other                                                  (18,787)   (14,257)
                                                       ---------  --------- 
                                                       $  42,451  $  69,130 
                                                       =========  ========= 

  
Company Contact:
Shane Harrison
+1 503.498.3547
www.flir.com 
 
 
Press spacebar to pause and continue. Press esc to stop.