OSI Systems Inc. F4Q09 (Qtr End 06/30/09) Earnings Call Transcript
OSI Systems Inc. (OSIS)
F4Q09 (Qtr End 06/30/09) Earnings Call
August 27, 2009 12:00 pm ET
Executives
Deepak Chopra - President and CEO
Alan Edrick - EVP and CFO
Ajay Mehra - President, Rapiscan Systems
Analysts
Brian Ruttenbur - Morgan Keegan
Tim Quillin - Stephens Inc.
Rick Hoss - Roth Capital Partners
Michael Kim - Imperial Capital
Josephine Millward - Dougherty & Company
Presentation
Operator
Previous Statements by OSIS
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Alan Edrick
Good morning and good afternoon and thank you for joining us. I'm Alan Edrick, Executive Vice President and CFO of OSI Systems. I'm here today with Deepak Chopra, our President and CEO; Ajay Mehra, President of our Security Division, Rapiscan Systems and Victor Sze, our General Counsel.
Welcome to the OSI Systems fiscal 2009 fourth quarter and year end conference call. We'd like to extend a special welcome to anyone who is a first time participant on our conference calls. Please also note that this presentation is being webcast and will remain on our website for approximately two weeks.
Before discussing our financial and operational highlights, I'd like to read the following statement. In connection with this conference call the company wishes to take advantage of the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995 with respect to statements that may be deemed to be forward-looking statements under the act. Such forward-looking statements could include general or specific comments by company officials on this call about future company performance, as well as certain responses to questions posed to company officials about future operating matters.
During today's conference call, we may refer to both GAAP and non-GAAP financial measures of the company's operating and financial results. For complete information regarding non-GAAP financial measures, the most directly comparable GAAP measures, please refer to today's press release regarding our quarterly results. The press release has also been filed with the SEC as part of the Form 8-K.
The company wishes to caution participants on this call that numerous factors could cause actual results to differ materially from any forward-looking statements made by the company. These factors include the risk factors set forth in the company's SEC filings. Any forward-looking statements made on this call speak only as of the date of this call and the company (inaudible) to update any forward-looking statements whether as a result of new information, future results or otherwise.
Before turning the call over to Deepak, I will provide a high level overview of our financial performance during our fourth quarter and full fiscal year. We will again touch on several themes that we discussed during past conference calls. Specifically despite a challenging economic environment, we continue to successfully execute a strategy to position the company for long-term growth.
This strategy is centered upon generating meaningful earnings and free cash flow while simultaneously investing in key sales markets, and research and development initiatives which will pave the way for sales growth. In the face of one of the most challenging sales quarters we have seen, we have never the less been able to achieve bottom line results that demonstrate the power of this plan.
Key data points for our fiscal 2009 fourth quarter and full fiscal year are as follows. First, although sales declined 5% for the year, we achieved a 23% increase in fiscal 2009 earnings per diluted share, excluding an impact of restructuring and other non-recurring charges and last year's one-time tax benefit. Our earnings per share were right in line with our previous guidance and proved operating efficiencies coupled with cost containment initiatives drove the solid increase.
Although Q4 sales for our Security and Opto divisions came in about as we expected, albeit declines with tough year-over-year comps. The challenges in our Healthcare division intensified during the quarter. However, we are confident in our long-term sales growth strategies and we will speak to the market outlook later on this call.
Second, we reported positive free cash flow for the sixth consecutive quarter. For the year, we generated a record $34 million in free cash flow or approximately $1.91 per share, thus reducing our net debt by approximately $22 million during the year after factoring in $7 million of stock repurchases.
Third, we divested the clinical trial services business of our Healthcare division. This business has suffered increasing losses and declining revenues for each of the past two years and was not considered the core ingredient of our business.
Although our sales experienced the negative effects of economic conditions at large, we are pleased with the fiscal '09 earnings and cash flow performance and believe that we begin fiscal 2010 in stronger shape than we entered fiscal '09 poised for growth. I'll be updating you further with more Q4 and fiscal year financial details and providing guidance on the outlook for the future, but first let me turn the call over to Deepak.
Deepak Chopra
Thank you, Alan. And again good morning and welcome to the OSI Systems earnings conference call for the fourth quarter and fiscal year ended June 30, 2009. In light of the challenging economic environment globally, we continue to deliver positive results for our shareholders. I'll touch on the highlights.
Highlights for the fourth quarter and fiscal year include; non-GAAP EPS improved 23% to $0.91 per diluted share. Company reported record free cash flow of $34 million. During the fiscal year we repurchased approximately 620,000 shares of common stock for approximately $7.4 million or at an average purchase price of $11.94 per share. We still have an active share buyback program in place with adequate head room.
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