-
Record Q4 Earnings per Share
-
Non-GAAP EPS of $1.02 (29% increase over prior year)
-
GAAP EPS of $0.58
-
FY 2014 Revenue Guidance of $870 million - $895 million (8% - 12%
growth)
-
FY 2014 Non-GAAP Earnings Guidance of $3.22 - $3.38 per Share (17%
- 22% growth)
HAWTHORNE, Calif.--(BUSINESS WIRE)--
OSI Systems, Inc. (NASDAQ: OSIS) today announced financial results for
its fourth quarter and fiscal year ended June 30, 2013.
Deepak Chopra, OSI Systems President and CEO, stated, "We are pleased to
announce the results of our fourth quarter, as we finished the year
strong, positioning us well for future growth. We achieved record
non-GAAP earnings for the 16th consecutive quarter as a result of
significant operating margin expansion. As expected, sales decreased 3%
as our fourth quarter sales from the prior year were unusually high due
to a large U.S. Army program that was substantially completed during
that quarter, making our prior fourth quarter results a difficult point
of comparison. Excluding the impact of this program, sales increased by
20%."
Mr. Chopra continued, "The momentum gained from a strong finish by each
division, combined with a year-end backlog of approximately $1 billion
and a significant pipeline of opportunities, positions us well for solid
growth in fiscal 2014."
The Company reported revenues of $228 million for the fourth quarter of
fiscal 2013, a decrease of 3% from the $235 million reported for the
fourth quarter of fiscal 2012. Net income for the fourth quarter of
fiscal 2013 was $11.8 million, or $0.58 per diluted share, compared to
net income of $15.9 million, or $0.78 per diluted share for the fourth
quarter of fiscal 2012. Excluding the impact of impairment,
restructuring and other charges, and the impact of tax elections
discussed below, net income for the fourth quarter of fiscal 2013 would
have been approximately $20.9 million, or $1.02 per diluted share,
compared to net income of $16.3 million, or $0.79 per diluted share for
the fourth quarter of fiscal 2012.
For the fiscal year ended June 30, 2013, the Company reported revenues
of $802 million, a 1% increase from the $793 million reported for fiscal
2012. Net income for fiscal 2013 was $44.1 million, or $2.15 per diluted
share, compared to net income of $45.5 million, or $2.24 per diluted
share in fiscal 2012. Excluding the impact of impairment, restructuring
and other charges, and the impact of tax elections discussed below, net
income for fiscal 2013 would have been approximately $56.8 million, or
$2.76 per diluted share, compared to net income of $46.6 million, or
$2.29 per diluted share for the comparable period of fiscal 2012.
During the fourth quarter, the Company made certain tax elections
related to the turnkey program in Mexico to accelerate depreciation and
realize cash tax savings of approximately $26 million. In doing so, the
Company forfeited tax basis in certain fixed assets that resulted in a
charge to income tax of $6.8 million, resulting in an effective tax rate
of 52.7% and 36.4% for the three months and fiscal year ended June 30,
2013, respectively. Had this election not been made, the effective tax
rate would have been 25.4% and 26.6% for the three months and fiscal
year ended June 30, 2013, respectively.
As of June 30, 2013, the Company's backlog was approximately $1.0
billion, which was comparable to the amount as of March 31, 2013. During
fiscal 2013, the Company generated cash flow from operations of $58.7
million and capital expenditures were $157.4 million primarily as a
result of the significant investment in the turnkey program in Mexico.
Mr. Chopra continued, "During the fourth quarter, our Security Division
achieved record operating profits as the higher margin turnkey screening
solution business was a key factor in increasing our operating margins
from 7% in fiscal 2012 to 16% in fiscal 2013. As expected, sales
declined as we recognized $47 million in revenues in the prior year
quarter related to a $98 million contract where we served as a prime
contractor and hardware systems integrator. The success of our turnkey
screening solution programs, the pipeline of opportunities and our
expanded product portfolio continue to provide an outstanding outlook
for our Security Division."
Mr. Chopra further commented, "Our Healthcare Division finished a
challenging year with a strong quarter. Although our fourth quarter
revenues were slightly lower than the prior year, we rebounded sharply
with 41% sequential sales growth leading to both record operating income
and operating margin, excluding the impact of restructuring and other
charges."
Mr. Chopra concluded, "Our Optoelectronics and Manufacturing Division
achieved record sales during our fourth quarter. Although our operating
margins were lower than the prior year due primarily to product mix and
increased reserves, we believe that our expanded customer base provides
optimism for continued growth."
Company Outlook — Guidance for Fiscal 2014
Subject to the risk factors referenced in the Safe Harbor section of
this press release, the Company announced that it anticipates fiscal
2014 sales to be between $870 million and $895 million, representing an
8% to 12% increase over fiscal 2013. In addition, the Company
anticipates approximately 17% - 22% growth in earnings per diluted share
to $3.22 to $3.38, excluding the impact of impairment, restructuring and
other non-recurring charges, and the impact of certain tax elections.
Non-GAAP Figures
Discussion of adjustments to arrive at non-GAAP figures for the three
months and fiscal year ended June 30, 2013 is provided to allow for the
comparison of underlying earnings, net of impairment, restructuring and
other non-recurring charges, and the impact of tax elections made
related to the Company's turnkey program in Mexico that result in tax
charges, thus providing additional insight into the on-going operations
of the Company. Non-GAAP financial measures should not be considered a
substitute for, or superior to, measures of financial performance
prepared in accordance with GAAP. We believe that these non-GAAP
financial measures provide meaningful supplemental information regarding
the Company's results primarily because they exclude amounts that we do
not view as reflective of ongoing financial results when planning and
forecasting and when assessing the performance of the business. We
believe that our non-GAAP financial measures also facilitate the
comparison of results for current periods and guidance for future
periods with results for past periods. Please see the reconciliation of
GAAP to non-GAAP net income and earnings per share at the end of this
release.
Conference Call Information
OSI Systems, Inc. will host a conference call and simultaneous webcast
over the Internet beginning at 9:00am PT (12:00pm ET) today to discuss
its results for the fourth quarter of fiscal 2013. To listen, please
visit the investor relations section of OSI Systems' website, http://investors.osi-systems.com/index.cfm,
and follow the link that will be posted on the front page. A replay of
the webcast will be available shortly after the conclusion of the
conference call until 11:59pm PT on August 31, 2013. The replay can
either be accessed through the Company's website, www.osi-systems.com,
or via telephonic replay by calling 1-888-286-8010 and entering the
conference call identification number ‘98153730' when prompted for the
replay code.
About OSI Systems, Inc.
OSI Systems, Inc. is a vertically integrated designer and manufacturer
of specialized electronic systems and components for critical
applications. The Company sells its products and services in diversified
markets, including homeland security, healthcare, defense and aerospace.
The Company has more than 30 years of experience in electronics
engineering and manufacturing and maintains offices and production
facilities located in more than a dozen countries. It implements a
strategy of expansion by leveraging its electronics and contract
manufacturing capabilities into selective end product markets through
organic growth and acquisitions. For more information on OSI Systems,
Inc. or any of its subsidiary companies, visit www.osi-systems.com.
News Filter: OSIS-E
This press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995, Section
27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Forward-looking statements
relate to the Company's current expectations, beliefs, projections and
similar expressions concerning matters that are not historical facts.
They are not intended to be guarantees of future performance. Forward-looking
statements involve uncertainties, risks, assumptions and contingencies,
many of which are outside the Company's control and which cause actual
results to differ materially from those described in or implied by any
forward-looking statement. Such statements include, but are not limited
to, information provided regarding expected revenues and earnings growth
in fiscal 2014, sales of recently-introduced products and expectations
surrounding the performance of the Company under its agreement with
Mexico's tax and customs authority. All forward-looking
statements are based on currently available information and speak only
as of the date on which they are made. The Company assumes no
obligation to update any forward-looking statement made in this press
release that becomes untrue because of subsequent events, new
information or otherwise, except to the extent it is required to do so
in connection with its ongoing requirements under Federal securities
laws. For a further discussion of these and other factors that
could cause the Company's future results to differ materially from any
forward-looking statements, see the section entitled "Risk Factors" in
the Company's Quarterly Report on Form 10-Q for the quarter ended March
31, 2013 and other risks described in documents filed by the Company
from time to time with the Securities and Exchange Commission.
OSI SYSTEMS, INC. AND SUBSIDIARIES
|
|
|
Consolidated Statements of Operations
|
|
(in thousands, except per share data)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
|
|
|
|
Year Ended June 30,
|
|
|
|
|
|
2012
|
|
|
|
2013
|
|
|
|
|
|
2012
|
|
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
$
|
235,241
|
|
|
|
|
$
|
227,895
|
|
|
|
|
|
|
$
|
792,990
|
|
|
|
|
$
|
802,047
|
|
|
Cost of goods sold
|
|
|
|
|
154,411
|
|
|
|
|
|
140,750
|
|
|
|
|
|
|
|
524,348
|
|
|
|
|
|
511,621
|
|
|
Gross profit
|
|
|
|
|
80,830
|
|
|
|
|
|
87,145
|
|
|
|
|
|
|
|
268,642
|
|
|
|
|
|
290,426
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative
|
|
|
|
|
44,337
|
|
|
|
|
|
45,255
|
|
|
|
|
|
|
|
151,746
|
|
|
|
|
|
159,761
|
|
|
Research and development
|
|
|
|
|
14,207
|
|
|
|
|
|
12,680
|
|
|
|
|
|
|
|
49,565
|
|
|
|
|
|
48,240
|
|
|
Restructuring and other charges
|
|
|
|
|
460
|
|
|
|
|
|
2,978
|
|
|
|
|
|
|
|
1,391
|
|
|
|
|
|
7,987
|
|
|
Total operating expenses
|
|
|
|
|
59,004
|
|
|
|
|
|
60,913
|
|
|
|
|
|
|
|
202,702
|
|
|
|
|
|
215,988
|
|
|
Income from operations
|
|
|
|
|
21,826
|
|
|
|
|
|
26,232
|
|
|
|
|
|
|
|
65,940
|
|
|
|
|
|
74,438
|
|
|
Interest expense and other income, net
|
|
|
|
|
(1,645
|
)
|
|
|
|
|
(1,200
|
)
|
|
|
|
|
|
|
(3,957
|
)
|
|
|
|
|
(5,024
|
)
|
|
Income before income taxes
|
|
|
|
|
20,181
|
|
|
|
|
|
25,032
|
|
|
|
|
|
|
|
61,983
|
|
|
|
|
|
69,414
|
|
|
Income tax expense
|
|
|
|
|
4,270
|
|
|
|
|
|
13,185
|
|
|
|
|
|
|
|
16,435
|
|
|
|
|
|
25,279
|
|
|
Net income
|
|
|
|
$
|
15,911
|
|
|
|
|
$
|
11,847
|
|
|
|
|
|
|
$
|
45,548
|
|
|
|
|
$
|
44,135
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted income per share
|
|
|
|
$
|
0.78
|
|
|
|
|
$
|
0.58
|
|
|
|
|
|
|
$
|
2.24
|
|
|
|
|
$
|
2.15
|
|
|
Weighted average shares outstanding — diluted
|
|
|
|
|
20,516
|
|
|
|
|
|
20,521
|
|
|
|
|
|
|
|
20,330
|
|
|
|
|
|
20,568
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Balance Sheets
|
|
(in thousands)
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, 2012
|
|
|
|
|
|
|
|
|
June 30, 2013
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
$
|
91,452
|
|
|
|
|
|
|
|
|
$
|
34,697
|
|
Accounts receivable, net
|
|
|
|
|
156,867
|
|
|
|
|
|
|
|
|
|
206,817
|
|
Inventories
|
|
|
|
|
195,178
|
|
|
|
|
|
|
|
|
|
206,213
|
|
Other current assets
|
|
|
|
|
39,616
|
|
|
|
|
|
|
|
|
|
78,972
|
|
Total current assets
|
|
|
|
|
483,113
|
|
|
|
|
|
|
|
|
|
526,699
|
|
Non-current assets
|
|
|
|
|
266,783
|
|
|
|
|
|
|
|
|
|
393,097
|
|
Total Assets
|
|
|
|
$
|
749,896
|
|
|
|
|
|
|
|
|
$
|
919,796
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders' Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bank lines of credit
|
|
|
|
$
|
---
|
|
|
|
|
|
|
|
|
$
|
59,000
|
|
Current portion of long term debt
|
|
|
|
|
215
|
|
|
|
|
|
|
|
|
|
1,797
|
|
Accounts payable and accrued expenses
|
|
|
|
|
75,252
|
|
|
|
|
|
|
|
|
|
123,660
|
|
Other current liabilities
|
|
|
|
|
85,182
|
|
|
|
|
|
|
|
|
|
96,956
|
|
Total current liabilities
|
|
|
|
|
160,649
|
|
|
|
|
|
|
|
|
|
281,413
|
|
Long-term debt
|
|
|
|
|
2,467
|
|
|
|
|
|
|
|
|
|
10,673
|
|
Advances from customers
|
|
|
|
|
100,000
|
|
|
|
|
|
|
|
|
|
75,000
|
|
Other long-term liabilities
|
|
|
|
|
52,661
|
|
|
|
|
|
|
|
|
|
74,259
|
|
Total liabilities
|
|
|
|
|
315,777
|
|
|
|
|
|
|
|
|
|
441,345
|
|
Total stockholders' equity
|
|
|
|
|
434,119
|
|
|
|
|
|
|
|
|
|
478,451
|
|
Total Liabilities and Equity
|
|
|
|
$
|
749,896
|
|
|
|
|
|
|
|
|
$
|
919,796
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SEGMENT INFORMATION
|
|
(in thousands)
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
|
|
|
|
Year Ended June 30,
|
|
|
|
|
|
2012
|
|
|
|
2013
|
|
|
|
|
|
2012
|
|
|
|
2013
|
|
Revenues — by Segment Group:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Security Group |
|
|
|
$
|
118,438
|
|
|
|
|
$
|
97,545
|
|
|
|
|
|
|
$
|
391,808
|
|
|
|
|
$
|
372,164
|
|
|
Healthcare Group |
|
|
|
|
73,502
|
|
|
|
|
|
72,279
|
|
|
|
|
|
|
|
235,548
|
|
|
|
|
|
231,331
|
|
|
Optoelectronics and Manufacturing Group, including intersegment
revenues
|
|
|
|
|
56,377
|
|
|
|
|
|
69,915
|
|
|
|
|
|
|
|
210,803
|
|
|
|
|
|
239,100
|
|
|
Intersegment revenues elimination
|
|
|
|
|
(13,076
|
)
|
|
|
|
|
(11,844
|
)
|
|
|
|
|
|
|
(45,169
|
)
|
|
|
|
|
(40,548
|
)
|
|
Total
|
|
|
|
$
|
235,241
|
|
|
|
|
$
|
227,895
|
|
|
|
|
|
|
$
|
792,990
|
|
|
|
|
$
|
802,047
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss) — by Segment Group:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Security Group(i)
|
|
|
|
$
|
8,149
|
|
|
|
|
$
|
14,497
|
|
|
|
|
|
|
$
|
30,552
|
|
|
|
|
$
|
43,748
|
|
|
Healthcare Group(ii)
|
|
|
|
|
11,353
|
|
|
|
|
|
10,835
|
|
|
|
|
|
|
|
28,330
|
|
|
|
|
|
25,224
|
|
|
Optoelectronics and Manufacturing Group(iii)
|
|
|
|
|
5,796
|
|
|
|
|
|
4,652
|
|
|
|
|
|
|
|
18,743
|
|
|
|
|
|
18,213
|
|
|
Corporate
|
|
|
|
|
(3,429
|
)
|
|
|
|
|
(4,298
|
)
|
|
|
|
|
|
|
(11,887
|
)
|
|
|
|
|
(14,002
|
)
|
|
Eliminations
|
|
|
|
|
(43
|
)
|
|
|
|
|
546
|
|
|
|
|
|
|
|
202
|
|
|
|
|
|
1,255
|
|
|
Total
|
|
|
|
$
|
21,826
|
|
|
|
|
$
|
26,232
|
|
|
|
|
|
|
$
|
65,940
|
|
|
|
|
$
|
74,438
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(i)
|
|
|
Includes restructuring and other charges of $0.3 million and $0.7
million for the three months ended June 30, 2012 and 2013,
respectively; and $0.3 million and $5.0 million for the years
ended June 30, 2012 and 2013, respectively.
|
|
|
|
|
|
|
(ii)
|
|
|
Includes restructuring and other charges of $0.2 million and $2.3
million for the three months ended June 30, 2012 and 2013,
respectively; and $0.2 million and $2.4 million for the years
ended June 30, 2012 and 2013, respectively.
|
|
|
|
|
|
|
(iii)
|
|
|
Includes restructuring and other charges of $0.9 million and $0.6
million for the years ended June 30, 2012 and 2013, respectively.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP to Non-GAAP
(in thousands, except earnings per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
|
|
Year Ended June 30,
|
|
|
|
|
|
2012
|
|
|
|
2013
|
|
|
|
2012
|
|
|
|
2013
|
|
|
|
|
|
Net
income
|
|
|
|
EPS
|
|
|
|
Net
income
|
|
|
|
EPS
|
|
|
|
Net
income
|
|
|
|
EPS
|
|
|
|
Net
income
|
|
|
|
EPS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP basis
|
|
|
|
$
|
15,911
|
|
|
|
$
|
0.78
|
|
|
|
$
|
11,847
|
|
|
|
$
|
0.58
|
|
|
|
$
|
45,548
|
|
|
|
$
|
2.24
|
|
|
|
$
|
44,135
|
|
|
|
$
|
2.15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment, restructuring and other charges, net of tax
|
|
|
|
|
363
|
|
|
|
|
0.01
|
|
|
|
|
2,220
|
|
|
|
|
0.11
|
|
|
|
|
1,022
|
|
|
|
|
0.05
|
|
|
|
|
5,862
|
|
|
|
|
0.28
|
|
Impact from election to accelerate depreciation for tax purposes
|
|
|
|
|
--
|
|
|
|
|
--
|
|
|
|
|
6,815
|
|
|
|
|
0.33
|
|
|
|
|
--
|
|
|
|
|
--
|
|
|
|
|
6,815
|
|
|
|
|
0.33
|
|
Non-GAAP basis
|
|
|
|
$
|
16,274
|
|
|
|
$
|
0.79
|
|
|
|
$
|
20,882
|
|
|
|
$
|
1.02
|
|
|
|
$
|
46,570
|
|
|
|
$
|
2.29
|
|
|
|
$
|
56,812
|
|
|
|
$
|
2.76
|
OSI Systems, Inc.
Ajay Vashishat
Vice President,
Business Development
310-349-2237
avashishat@osi-systems.com
Source: OSI Systems, Inc.
News Provided by Acquire Media
