FLIR Systems Inc. (FLIR) released its second-quarter 2012 results before
the market opened today, reporting earnings from continuing
operations of 30 cents, above the Zacks Consensus Estimate of 28
cents but below the prior-year earnings of 35 cents.
Total revenue was $338.3 million, a decrease of 14% year over
year. Total backlog at the end of the second quarter 2012 was about
$498 million, reflecting a 9% increase over the year-ago
Commercial Systems division's revenue was $189.8 million in the
quarter, down 12% year over year. Within the Commercial Systems
division, the Thermal Vision and Measurement segment revenue
decreased by 13% to $142.6 million. Commercial Systems' Raymarine
segment revenue was $47.2 million, down 6% year over year.
Government Systems division's revenue came in at $148.5 million
in the quarter, down 16% year over year. Within the division, the
Surveillance segment revenue declined 16% to $119.5 million.
Detection segment revenue was $15.7 million, down 9% while
Integrated Systems segment revenue was $13.3 million, down 26%.
Income and Expenses
Operating earnings, for the quarter, was $60.7 million compared
with $41.8 million in the prior-year period. Selling and general
expense was $71.8 million, down considerably from $124.1 million in
the year-ago quarter, whereas research and development expense was
$37.5 million down roughly from $39.5 million in the second quarter
Balance Sheet/Cash Flow
Exiting the second quarter 2012, the company had cash and cash
equivalents of approximately $429.8 million compared with $448.2
million at the end of the previous quarter. Long-term debt stood at
$248.1 million roughly in line with $248.0 million in the previous
quarter. Shareholders equity in the quarter was $1.56 billion.
Cash flow from operations amounted to $77.2 million, up compared
with $19.4 million in the year-ago quarter. Capital spending was
down 6.7% to $13.5 million.
During the second quarter 2012, the company expended roughly
$64.8 million on repurchasing 3 million shares at an average price
of $21.60 and paid dividends amounting to $10.7 million.
Along with its earnings results the company's Board of Directors
also declared a dividend of 7 cents per share. The dividend is
payable on September 7 to shareholders of record as of August
Management reiterated its recently revised guidance and expects
earnings per share for 2012 to be in the range of $1.40 to $1.50,
up 1% to 9% over 2011. Total revenue is anticipated within
$1.4-$1.5 billion range, down 3%-9% year over year.
FLIR Systems Inc. is a leader in design, manufacture and
marketing of thermal imaging systems. Its products are used in a
wide variety of applications in commercial, industrial and
government markets, internationally as well as domestically. It
offers a wide variety of system configurations to suit specific
The company's business is organized into three divisions:
Government Systems, Commercial Vision Systems and Thermography
Products. Major competitors of FLIR Systems are L-3
Communications Holdings Inc. (LLL) and Lockheed Martin Corporation
We continue to maintain an Underperform recommendation on FLIR
System. The stock also bears a Zacks #4 Rank (Sell) over the next
FLIR SYSTEMS (FLIR): Free Stock Analysis Report
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