In-Line Q4 Earnings & Revs at iRobot - Analyst Blog
Robot maker, iRobot Corporation ( IRBT ) reported fourth-quarter 2013 results, showing year-over-year improvement in both earnings and revenues. The company posted earnings of 11 cents a share which compared favorably with a loss of 21 cents in the year-ago quarter. Earnings for the reported quarter were in line with the Zacks Consensus Estimate.
For 2013, iRobot reported earnings per share of 94 cents, missing the Zacks Consensus Estimate of 95 cents. Reported earnings were, however, above the year-ago figure of 61 cents per share.
Revenues : Revenues for the reported quarter improved roughly 25.5% year over year to $126.3 million and were roughly in line with the Zacks Consensus Estimate of $126.0 million. The increase in revenues was a result of improved demand in the Home Robots segment.
During the quarter, product revenues of $125.4 million accounted for 99.3% of the total revenue, while the remaining 0.7% was contributed by services revenues which came in at $917,000.
For 2013, iRobot reported revenues of $487.4 million, roughly flat with the Zacks Consensus Estimate of $488.0 million. Revenues were, however, higher than $436.2 million generated in 2012.
Margins/Costs: Gross margin in the reported quarter was 46.6%, up 244 basis points (bps) compared with 44.2% in the year-ago quarter. Operating expenses increased 1.6% year over year in the quarter to $54.2 million. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) in the quarter were recorded at $12.8 million compared with $981.0 million in the year-ago quarter.
Segment Details: The Home Robots segment generated revenues of $108.3 million in the quarter, up 30.6% year over year. The sales increase was a result of improvement in domestic as well as overseas markets. The segment's gross margin declined 160 bps year over year to 49.6%. In the quarter, iRobot shipped 494 units of Home Robots, compared with 387 units shipped in the fourth quarter of 2012.
The Defense & Security segment's revenues were recorded at $16.3 million compared with $15.7 million in the year-ago quarter. The year-over-year sales hike of 3.9% was in line with the company expectations. The segment's gross margin reached 59.4% compared with 45.3% in the year-ago quarter.
Balance Sheet/Cash Flow: Exiting the fourth quarter of 2013, iRobot's cash and cash equivalents were recorded at $165.4 million, compared with $139.7 million in the preceding quarter. iRobot had long-term debt of $4.7 million, up from $4.5 million in the quarter ended Sep 30, 2013.
In the reported quarter, iRobot generated cash flow from operations of $31.3 million, against $26.6 million generated in the year-ago comparable quarter. In the quarter, capital expenditure was recorded at $1.7 million against $2.7 million in the quarter ended Dec 2012.
Outlook: Management expects the products launched in and after the reported quarter to derive a significant market share in the coming quarters. Home Robots segment is expected to continue generating higher revenues. In the first-quarter 2014, revenues are expected in the range of $110.0 to $113.0 million, with earnings per share in the 13 cents to 17 cents range. Adjusted EBITDA in the quarter is expected in the range of $13 to $15 million.
iRobot expects revenues in 2014 to be within $560.0 to $570.0 million. Adjusted EBITDA is estimated in the range of $74.0 to $78.0 million, with earnings per share in the range of $1.00 to $1.15.
In 2014, Home Robots segment is expected to generate revenues in the range of $500.0 to $515.0 million while Defense & Security segment's revenues are expected to be $50.0 million.
Other Stocks to Consider
iRobot currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the industry include Altra Industrial Motion Corp. ( AIMC ), Barnes Group Inc. ( B ) and The Middleby Corporation ( MIDD ). All these stocks carry a Zacks Rank #2 (Buy).
ALTRA HOLDINGS (AIMC): Free Stock Analysis Report
BARNES GRP (B): Free Stock Analysis Report
IROBOT CORP (IRBT): Free Stock Analysis Report
MIDDLEBY CORP (MIDD): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research