OSI Systems (NASDAQ:OSIS)
Historical Stock Chart
From Jul 2019 to Jul 2024
OSI Systems, Inc. (Nasdaq:OSIS):
-0-
*T
-- Operating income of $2.9 million after stock-based
compensation expenses of $1.3 million;
-- Breakeven Diluted Earnings Per Share:
-- Stock-based compensation expenses of $1.3 million, or
$0.06 per diluted share;
-- Minority Interest provision of approximately $1 million
associated with Spacelabs Healthcare, or $0.06 per diluted
share;
-- Tax expense for the quarter of $1.9 million, tax rate of
64.4%.
*T
OSI Systems, Inc. (Nasdaq:OSIS) today announced its revenues and
results for the second quarter of fiscal 2006.
The company reported record revenues of $117.1 million for the
second quarter of fiscal 2006, an increase of 14% from $102.5 million
reported for the second quarter of fiscal 2005. For the six months of
fiscal 2006, revenues increased by $28.8 million, or 15%, to $219.0
million, from $190.2 million for the first six months of fiscal 2005.
Operating income for the second quarter was $2.9 million, which
included stock-based compensation expenses of $1.3 million. This
compares to operating income of $3.2 million for the second quarter of
fiscal 2005, which did not include stock-based compensation expenses.
For the first six months of fiscal 2006, the company reported an
operating loss of $3.6 million, which included stock-based
compensation expenses of $2.5 million. This compares to operating
income of $5.0 million for the first six months of fiscal 2005, which
did not include stock-based compensation expenses.
The tax rate for the second quarter of fiscal 2006 was 64.4%,
compared to 24.3% for the second quarter of fiscal 2005. The increase
in the tax rate for the second quarter of fiscal 2006 was due to the
Company not receiving any tax benefit for losses in certain non-US
subsidiaries and inclusion of incentive stock options in the stock
compensation expense, which does not qualify as a tax deduction. For
the first six months of fiscal 2006 the tax benefit was 24%, compared
to a tax provision of 26.9% for the first six months of fiscal 2005.
Net income for the second quarter of fiscal 2006 was $85,000,
compared to net income of $2.5 million for the second quarter of
fiscal 2005. For the six months of fiscal 2006, the Company reported a
net loss of $4.1 million, compared to net income of $3.8 million for
the first six months of fiscal 2005.
For the second quarter of fiscal 2006, the Company reported
earnings of $0.00 per diluted share, compared to earnings of $0.15 per
diluted share for the second quarter of fiscal 2005. For the first six
months of fiscal year 2006, the Company reported a loss of $0.26 per
diluted share, compared to earnings of $0.23 per diluted share for the
first six months of fiscal 2005.
In accordance with the Statement of Financial Accounting Standards
No. 123(R), Share-Based Payment, the Company incurred stock-based
compensation expenses of $1.3 million pre-tax, or $0.06 per diluted
share, for the second quarter of fiscal 2006. For the first half of
fiscal 2006, the Company incurred stock-based compensation expenses of
$2.5 million, or $0.12 per diluted share. For fiscal 2006, the Company
anticipates that the total stock-based compensation expenses will be
approximately $5.5 million. Results for fiscal 2005 do not include
stock-based compensation expenses.
As of December 31, 2005, cash and cash equivalents were
approximately $17.1 million, compared to $14.6 million as of June 30,
2005. During the second quarter of fiscal 2006, the Company repaid
approximately $24 million under its lines of credit.
OSI Chairman and CEO Deepak Chopra said, "I am very pleased with
the company's operating performance in the second quarter as we turned
the corner and returned to profitability. I expect that the company
will improve on this performance in the second half of fiscal 2006,
supported by the Company's strong backlog position, which currently
stands at approximately $134 million. The Security Group continues to
improve its operating performance, and we expect that the Group will
be profitable in the second half of fiscal 2006. Additionally, both
the Healthcare Group and Opto-electronics Group will continue to be
profitable for the remainder of fiscal 2006.
"The Security Group has been investing heavily in their Cargo and
Vehicle Inspection and Hold Baggage Screening ("HBS") product
portfolio over the last five quarters. In the second quarter of fiscal
2006, we were excited to announce the launch and market acceptance of
our first product offering in the HBS market, the Rapiscan MVXR5000
Inline Automated Hold Baggage Screening System for checked baggage.
The product received `Approval for Use' accreditation from the UK
Department of Transport in December, allowing the Group to begin
selling the system internationally with the exception of the US
market. Additionally, we continue to invest in the development of the
first-of-its-kind, high speed, solid-state CT system that we call
`Real Time Tomography,' or RTT. The RTT, being electronic and
non-mechanical, can achieve a throughput of up to 1,500 bags per hour,
compared to the current systems on the market, which have a throughput
of approximately 600 bags an hour. The RTT will also result in the
reduction of installation costs and maintenance issues.
"This quarter also saw the successful IPO of Spacelabs Healthcare,
Inc., our Healthcare Group, on the London AIM market. The IPO will
provide us with an independent share currency, which we intend to
utilize for the growth and expansion of Spacelabs Healthcare.
Operationally, the Group achieved record revenues in the second
quarter, helped by a 36% bookings increase for patient monitoring
solutions in the US market. Additionally, Blease Medical, recently
acquired in February 2005, received 510(k) approval from the FDA for
the distribution of its Sirius anaesthesia system and ventilators in
the US market. We expect to launch this product in the US market in
2007."
Guidance for the Six Months Ended June 30, 2006
For the second half of fiscal 2006 the Company announced revenue
guidance of $231 million to $236 million, compared to revenues of $219
million for the first half of fiscal 2006, and $194.9 million for the
second half of fiscal 2005.
The Company expects to be profitable for the second half of fiscal
2006 and anticipates that revenues and earnings will be stronger in
the fourth quarter when compared to the third quarter of fiscal 2006.
The Company expects that the effective tax rate for the full year
of fiscal 2006 will be in the mid-forties.
Segment Information
Security Group
The Security Group reported revenues of $30.4 million for the
second quarter of fiscal 2006, a decrease of 5%, from $32.0 million
reported for the second quarter of fiscal 2005. For the first six
months of fiscal 2006, revenues decreased by $4.7 million, or 8%, to
$57.3 million, from $62 million for the first six months of fiscal
2005.
Loss from operations for the second quarter of fiscal 2006 was
$651,000, compared to a loss from operations of $1.3 million for the
second quarter of fiscal 2005, and $3.2 million for the first quarter
of fiscal 2006. For the first six months of fiscal 2006, the Group had
a loss from operations of $3.8 million, compared to income from
operations of $1.1 million for the first six months of fiscal 2005.
For the second quarter and first six months of fiscal 2006, the Group
incurred stock-based compensation expenses of $0.2 million and $0.4
million, respectively. In fiscal 2005, the Group did not incur
stock-based compensation expenses.
Healthcare Group
The Healthcare Group reported record revenues of $61.0 million for
the second quarter of fiscal 2006, compared to $54.0 million reported
for the second quarter of fiscal 2005. For the first six months of
fiscal 2006, revenues increased by $15.6 million to a record level of
$112.4 million from $96.8 million for the first six months of fiscal
2005. Adjusting for the Blease acquisition completed in February 2005,
revenues grew for the second quarter of fiscal 2006 by approximately
6%, compared to the second quarter of fiscal 2005.
Income from operations for the second quarter of fiscal 2006 was
$5.3 million, compared to $4.9 million for the second quarter of
fiscal 2005. For the first six months of fiscal 2006, income from
operations increased by $1.4 million, or 27%, to $6.5 million, from
$5.1 million for the first half of fiscal 2005. Operating results for
the second quarter and six months ending December 31, 2005, included
stock-based compensation-related expenses of $0.3 million and $0.5
million, respectively. In fiscal 2005, the Group did not incur stock
based-compensation expenses.
Optoelectronics Group
The Optoelectronics & Manufacturing Group reported external
revenues of $25.8 million for the second quarter of fiscal 2006, an
increase of 56% from $16.5 million reported for the second quarter of
fiscal 2005. For the first half of fiscal 2006, external revenues
increased by $17.9 million, or 57%, to $49.3 million from $31.4
million for first six months of fiscal 2005.
Income from operations for the second quarter of fiscal 2006 was
$2.6 million, compared to $2 million for the second quarter of fiscal
2005. For the first half of fiscal 2006, income from operations
increased by $0.1 million, to $3.8 million from $3.7 million for the
first six months of fiscal 2005. For the second quarter and first six
months of fiscal 2006, the Group incurred stock-based compensation
expenses of $0.1 million and $0.3 million, respectively. In fiscal
2005, the Group did not incur stock-based compensation expenses.
Earnings Conference Call Information
OSI Systems, Inc. will webcast the live earnings call over the
Internet at 9:00 am PT (12:00 pm ET) on February 9, 2006. To listen,
please log on to www.earnings.com or www.osi-systems.com and follow
the link that will be posted on the front page. A replay of the
webcast will be available shortly after the presentation and will be
archived on www.earnings.com or www.osi-systems.com. A telephonic
replay of the call will also be available from 11:00 am PT (2:00 pm
ET) on February 9, 2006, until February 16, 2006. The replay may be
accessed by calling 1-888-286-8010 (domestic) or +1-617-801-6888
(international) and entering the replay passcode of "10995854".
About OSI Systems, Inc.
OSI Systems, Inc. is a Hawthorne-based diversified global
developer, manufacturer and seller of security and inspection systems,
medical monitoring and anesthesia delivery products, and
optoelectronic-based components, as well as a provider of engineering
and manufacturing services. 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. OSI Systems 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.
This press release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. Such
statements include information regarding the company's expectations,
goals or intentions about the future, including, but not limited to,
statements regarding its revenues, profitability, tax rates,
stock-based compensation expenses, and operating performance, the
Security Group's real-time tomography product, the use to which the
company will put its Spacelabs Healthcare share currency, the launch
of the Healthcare Group's Sirius anaesthesia system and ventilators in
the US market, and future revenues and operating income of the
Optoelectronics and Manufacturing Group will continue to experience
growth or that the medical OEM device sector will continue to
contribute to such growth. The actual results may differ materially
from those described in or implied by any forward-looking statement.
In particular, there can be no assurance that predictions made in
connection with the foregoing financial matters will be in line with
current expectations, that the Security Group's real-time tomography
product will achieve throughput rates and other currently expected
benefits or be sold, that the Spacelabs Healthcare IPO will ultimately
prove to have been an auspicious undertaking, that the Sirius
anaesthesia system will launch in the US on time or at all. Other
important factors are set forth in our Securities and Exchange
Commission filings. All forward-looking statements speak only as of
the date made, and we undertake no obligation to update these
forward-looking statements.
-0-
*T
OSI SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share amounts)
Three months ended Six months ended
December 31, December 31,
----------------------- -----------------------
2005 2004 2005 2004
----------- ----------- ----------- -----------
Revenues $117,138 $102,531 $219,008 $190,175
Cost of goods sold -
(includes non-cash,
stock-based expense
of $53 and $108 for
the three and six
months ended December
31, 2005) 71,999 66,079 136,917 119,933
----------- ----------- ----------- -----------
Gross profit 45,139 36,452 82,091 70,242
Operating expenses:
Selling, general and
administrative -
(includes non-cash,
stock-based expense
of $1,144 and $2,218
for the three and six
months ended
December 31, 2005) 33,515 25,595 66,929 50,388
Research and development -
(includes non-cash,
stock-based expense of
$103 and $215 for the
three and six months
ended December 31,
2005) 8,700 7,066 17,431 13,736
Management retention
bonus 51 549 572
Restructuring charges - - 800 1,098
----------- ----------- ----------- -----------
Total operating
expenses 42,266 33,210 85,732 65,222
----------- ----------- ----------- -----------
Income (Loss) from
operations 2,873 3,242 (3,641) 5,020
Interest income 69 103 89 191
Interest expense (399) (98) (950) (154)
Gain on marketable
securities 349 349
----------- ----------- ----------- -----------
Income (loss) before
provision (benefit)
for income taxes and
minority interest 2,892 3,247 (4,153) 5,057
Provision (benefit)
for income taxes 1,861 789 (996) 1,358
----------- ----------- ----------- -----------
Income (loss) before
minority interest 1,031 2,458 (3,157) 3,699
Minority interest (946) - (946) 68
----------- ----------- ----------- -----------
Net income (loss) $85 $2,458 ($4,103) $3,767
=========== =========== =========== ===========
Earnings (loss) per
share $0.01 $0.15 ($0.25) $0.23
=========== =========== =========== ===========
Diluted earnings
(loss) per share $0.00 $0.15 ($0.26) $0.23
=========== =========== =========== ===========
Weighted average
shares outstanding 16,299,337 16,168,778 16,270,205 16,185,269
=========== =========== =========== ===========
Weighted average
shares outstanding -
assuming dilution 16,490,714 16,592,724 16,270,205 16,577,752
=========== =========== =========== ===========
Condensed Consolidated Balance Sheets
(in thousands)
December 31, June 30, 2005
2005
---------------- --------------
Cash, cash equivalents and marketable
securities $17,201 $14,623
Accounts receivable, net of allowance
for doubtful accounts 101,392 89,227
Inventory 110,235 107,441
Other current assets 29,218 26,382
---------------- --------------
Total current assets 258,046 237,673
Non-current assets 111,407 109,447
---------------- --------------
Total $369,453 $347,120
================ ==============
Bank lines of credit $2,050 $15,752
Current portion of long-term debt and
capital lease obligations 1,037 499
Other current liabilities 104,091 97,024
---------------- --------------
Total current liabilities 107,178 113,275
Long-term debt 5,567 4,852
Other long-term liabilities 6,095 5,366
Minority interest 8,718
Shareholders' equity 241,894 223,627
---------------- --------------
Total $369,453 $347,120
================ ==============
Segment Information
(in thousands)
Quarter ended December 31, 2005
Security Healthcare Optoelectronics
Group(1) Group(1) Group(1)
--------- ----------- ----------------
Revenues:
External $30,378 $60,999 $25,761
Intercompany - - 5,367
--------- ----------- ----------------
Total Revenues $30,378 $60,999 $31,128
========= =========== ================
Operating (Loss) Income $(651) $5,319 $2,581
========= =========== ================
Quarter ended December 31, 2005
Corporate(1) Eliminations Total
------------ ------------- ---------
Revenues:
External $- $- $117,138
Intercompany - (5,367) -
------------ ------------- ---------
Total Revenues $- $(5,367) $117,138
============ ============= =========
Operating (Loss) Income $(4,293) $(83) $2,873
============ ============= =========
Quarter ended December 31, 2004
Security Healthcare Optoelectronics
Group Group Group
--------- ----------- ----------------
Revenues:
External $32,037 $54,000 $16,494
Intercompany - - 5,652
--------- ----------- ----------------
Total Revenues $32,037 $54,000 $22,146
========= =========== ================
Operating (Loss) Income $(1,283) $4,863 $2,004
========= =========== ================
Quarter ended December 31, 2004
Corporate Eliminations Total
------------ ------------- ---------
Revenues:
External $- $- $102,531
Intercompany - (5,652) -
------------ ------------- ---------
Total Revenues $- $(5,652) $102,531
============ ============= =========
Operating (Loss) Income $(2,062) $(280) $3,242
============ ============= =========
(1) Includes non-cash, stock-based compensation in accordance with
SFAS 123R for the three months ended December 31, 2005,
as follows:
Security Group $206
Healthcare Group 290
Optoelectronics Group 126
Corporate 678
-------
$1,300
Six months ended December 31, 2005
Security Healthcare Optoelectronics
Group(2) Group(2) Group(2)
--------- ----------- ----------------
Revenues:
External $57,341 $112,370 $49,297
Intercompany - - 9,607
--------- ----------- ----------------
Total Revenues $57,341 $112,370 $58,904
========= =========== ================
Operating (Loss) Income $(3,844) $6,502 $3,783
========= =========== ================
Six months ended December 31, 2005
Corporate(2) Eliminations Total
--------------- ------------- ---------
Revenues:
External $- $- $219,008
Intercompany - (9,607) -
--------------- ------------- ---------
Total Revenues $- $(9,607) $219,008
=============== ============= =========
Operating (Loss) Income $(10,115) $33 $(3,641)
=============== ============= =========
Six months ended December 31, 2004
Security Healthcare Optoelectronics
Group Group Group
--------- ----------- ----------------
Revenues:
External $61,980 $96,804 $31,391
Intercompany - - 9,917
--------- ----------- ----------------
Total Revenues $61,980 $96,804 $41,308
========= =========== ================
Operating Income (Loss) $1,076 $5,098 $3,689
========= =========== ================
Six months ended December 31, 2004
Corporate Eliminations Total
--------------- ------------- ---------
Revenues:
External $- $- $190,175
Intercompany - (9,917) -
--------------- ------------- ---------
Total Revenues $- $(9,917) $190,175
=============== ============= =========
Operating Income (Loss) $(4,426) $(417) $5,020
=============== ============= =========
(2) Includes non-cash, stock-based compensation in accordance with
SFAS 123R for the six months ended December 31, 2005, as follows:
Security Group $447
Healthcare Group 457
Optoelectronics Group 277
Corporate 1360
-------
$2,541
*T