Zebra Technologies Corp. : Zebra Technologies Announces 2012 First Quarter Financial Results
04/27/2012| 03:05am US/Eastern
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LINCOLNSHIRE, Ill., April 27, 2012 /PRNewswire/ -- Zebra Technologies Corporation (NASDAQ: ZBRA) today announced 2012 first quarter diluted earnings per share of $0.58, up 7.4% from $0.54 from continuing operations for the first quarter of 2011. Net sales for the quarter ended March 31, 2012, increased 2.8% to $243,875,000 from $237,301,000 for the first quarter of 2011.
Summary Financial Performance (Unaudited)
----------------------------------------
1Q12 1Q11 Change
---- ---- ------
Net sales (in 000s) $243,875 $237,301 2.8%
Gross margin (%) 49.1 50.6 -1.5 pts.
Operating margin (%) 17.2 18.7 -1.5 pts.
Income from continuing $30,164 $30,128 0.1%
operations (in 000s)
Income from
discontinued -- $31,506 NM
operations, net of tax
(in 000s)
Net income (in 000s) $30,164 $61,634 -51.1%
Diluted earnings per
share:
Income from continuing
operations $0.58 $0.54 7.4%
Income from
discontinued
operations -- $0.56 -100.0%
Net income $0.58 $1.10 -47.3%
---------- ----- ----- -----
"Strategically-driven activities to gain share, penetrate targeted industries more deeply and extend geographic reach led to sales growth in all geographic regions," stated Anders Gustafsson, Zebra's chief executive officer. "Our formidable product line, extensive global channel relationships and business diversity enabled us to win more business with customers in a broad range of industries. In a challenged business environment, we matched excellent execution with effective control over operating expenses. We continued to invest in those areas critical to Zebra's long-term success. This year, we are on target to deliver a high number of innovative new printer products. These and other solutions are enabling our customers to gain greater visibility into assets, transactions and people across their value chains. We remain confident in Zebra's future and our ability to accelerate growth and deliver higher returns for our shareholders."
As of March 31, 2012, Zebra had $362,244,000 in cash and investments, and no long-term debt. Net inventories were $126,119,000, and net accounts receivable were $157,114,000.
Discussion and Analysis
-- Net sales for the first quarter of 2012 included year-over-year growth
in all four of the company's geographic regions. Sales growth of
supplies and card printers were notably strong. The impact of movements
in foreign exchange, net of hedges, was not material to sales growth.
-- Gross margin of 49.1%, versus 50.6% a year ago, primarily reflects
movements in product mix.
-- Operating expense growth of 2.9% includes a modest increase in
administrative expenses, as well as higher sales and marketing expenses
which were principally related to activities supporting the company's
geographic expansion and market development activities. This growth was
partially offset by a decline in engineering expenses. Operating profit
margin decreased from 18.7% to 17.2%.
Stock Purchase Update
During the first quarter of 2012, Zebra repurchased 264,567 shares of Zebra Technologies Corporation Class A Common Stock. At March 31, 2012, the company had 3,231,632 shares remaining in its stock buyback authorization, and 51,908,000 shares of common stock were outstanding.
Second Quarter Outlook
Zebra announced its financial forecast for the second quarter of 2012. Net sales are expected within a range of $250,000,000 to $260,000,000. Diluted earnings per share are expected within a range of $0.58 to $0.63.
Conference Call Notification
Investors are invited to listen to a live webcast of Zebra's conference call discussing the company's financial results for the first quarter of 2012. The conference call will be held at 11:00 AM Eastern Time today. To listen to the call, visit the company's website at http://www.zebra.com.
Forward-looking Statement
This press release contains forward-looking statements, as defined by the Private Securities Litigation Reform Act of 1995, including, without limitation, the statements regarding the company's financial forecast for the second quarter of 2012 stated in the paragraph above captioned "Second Quarter Outlook." Actual results may differ from those expressed or implied in the company's forward-looking statements. These statements represent estimates only as of the date they were made. Zebra undertakes no obligation, other than as may be required by law, to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason after the date of this release.
These forward-looking statements are based on current expectations, forecasts and assumptions and are subject to the risks and uncertainties inherent in Zebra's industry, market conditions, general domestic and international economic conditions, and other factors. These factors include customer acceptance of Zebra's hardware and software products and competitors' product offerings, and the potential effects of technological changes. The continued uncertainty over future global economic conditions, the availability of credit, capital markets volatility, may have adverse effects on Zebra, its suppliers and its customers. In addition, a disruption in our ability to obtain products from vendors as a result of supply chain constraints, natural disasters or other circumstances could restrict sales and negatively affect customer relationships. Profits and profitability will be affected by Zebra's ability to control manufacturing and operating costs. Because of a large investment portfolio, interest rates and financial market conditions will also have an impact on results. Foreign exchange rates will have an effect on financial results because of the large percentage of our international sales. The outcome of litigation in which Zebra may be involved is another factor. These and other factors could have an adverse effect on Zebra's sales, gross profit margins and results of operations and increase the volatility of our financial results. When used in this release and documents referenced, the words "anticipate," "believe," "estimate," and "expect" and similar expressions, as they relate to the company or its management, are intended to identify such forward-looking statements, but are not the exclusive means of identifying these statements. Descriptions of the risks, uncertainties and other factors that could affect the company's future operations and results can be found in Zebra's filings with the Securities and Exchange Commission. In particular, readers are referred to Zebra's Form 10-K for the year ended December 31, 2011.
About Zebra Technologies
A global leader respected for innovaion and reliability, Zebra Technologies Corporation (NASDAQ: ZBRA) provides enabling technologies that allow customers to take smarter actions. Our extensive portfolio of bar code, receipt, card, kiosk and RFID printers and supplies, as well as real-time location solutions give a digital voice to assets, people and transactions that provides greater visibility into mission-critical information. For more information about Zebra's solutions, visit http://www.zebra.com.
Contact:
Investors: Media:
---------- ------
Douglas A. Fox,
CFA Kerry Kelly-Guiliano
Vice President,
Investor
Relations Vice President, Strategic Communications
and Treasurer F T I Consulting
+1 847 793 6735 +1 617 747 3603
dfox@zebra.com kerry.guiliano@fticonsulting.com
ZEBRA TECHNOLOGIES CORPORATION
CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
---------------------
March 31, December 31,
2012 2011
---- ----
ASSETS (Unaudited)
Current assets:
Cash and cash equivalents $41,943 $36,418
Investments and marketable
securities 175,169 182,398
Accounts receivable, net 157,114 155,230
Receivable from buyer 13,790 27,580
Inventories, net 126,119 133,288
Deferred income taxes 14,194 13,931
Income tax receivable 6,917 13,111
Prepaid expenses and other
current assets 15,036 22,917
Total current assets 550,282 584,873
------- -------
Property and equipment at cost,
less accumulated depreciation
and amortization 101,985 97,822
Long-term deferred income taxes 11,995 11,866
Goodwill 79,703 79,703
Other intangibles, net 11,897 12,667
Long-term investments and
marketable securities 145,132 107,879
Other assets 4,092 4,196
----- -----
Total assets $905,086 $899,006
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $33,019 $33,273
Accrued liabilities 47,769 64,612
Deferred revenue 12,065 11,089
Total current liabilities 92,853 108,974
Deferred rent 1,496 1,592
Other long-term liabilities 11,674 11,515
------ ------
Total liabilities 106,023 122,081
------- =======
Stockholders' equity:
Preferred Stock -- --
Class A Common Stock 722 722
Additional paid-in capital 134,472 131,422
Treasury stock (603,705) (596,622)
Retained earnings 1,275,780 1,245,616
Accumulated other comprehensive
loss (8,206) (4,213)
------ ------
Total stockholders' equity 799,063 776,925
------- -------
Total liabilities and
stockholders' equity $905,086 $899,006
======== ========
ZEBRA TECHNOLOGIES CORPORATION
CONSOLIDATED STATEMENTS OF EARNINGS
(Amounts in thousands, except per share data)
(Unaudited)
Three Months Ended
------------------
March 31, 2012 April 2, 2011
-------------- -------------
Net
sales:
Net
sales
of
tangible
products $232,476 $226,120
Revenue
from
services
and
software 11,399 11,181
------ ------
Total
net
sales 243,875 237,301
------- -------
Cost
of
sales
Cost
of
sales
of
tangible
products 119,053 110,781
Cost
of
services
and
software 4,959 6,522
----- -----
Total
cost
of
sales 124,012 117,303
------- -------
Gross
profit 119,863 119,998
------- -------
Operating
expenses:
Selling
and
marketing 32,114 28,528
Research
and
development 20,419 21,681
General
and
administrative 24,551 22,706
Amortization
of
intangible
assets 770 835
Exit
and
restructuring
costs -- 1,886
Total
operating
expenses 77,854 75,636
------ ------
Operating
income 42,009 44,362
------ ------
Other
income
(expense):
Investment
income 592 560
Foreign
exchange
loss (342) (294)
Other,
net (364) (254)
---- ----
Total
other
income
(expense) (114) 12
---- ---
Income
from
continuing
operations 41,895 44,374
before
income
taxes
Income
taxes 11,731 14,246
------ ------
Income
from
continuing
operations 30,164 30,128
Income
from
discontinued
operations,
net of
tax -- 31,506
Net
income $30,164 $61,634
======= =======
Basic
earnings
per
share:
Income
from
continuing
operations $0.58 $0.54
Income
from
discontinued
operations -- 0.57
--- ----
Net
income $0.58 $1.11
===== =====
Diluted
earnings
per
share:
Income
from
continuing
operations $0.58 $0.54
Income
from
discontinued
operations -- 0.56
--- ----
Net
income $0.58 $1.10
===== =====
Basic
weighted
average
shares
outstanding 51,998 55,353
Diluted
weighted
average
and
equivalent
shares
outstanding 52,301 55,774
ZEBRA TECHNOLOGIES CORPORATION
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Amounts in thousands)
(Unaudited)
Three Months Ended
------------------
March 31, 2012 April 2, 2011
-------------- -------------
Net income $30,164 $61,634
Other
comprehensive
income (loss):
Unrealized
losses on
hedging
transactions,
net of income
taxes (4,646) (2,756)
Unrealized
holding gains
(losses) on
investments,
net of income
taxes 570 (14)
Foreign
currency
translation
adjustment 83 (553)
Comprehensive
income $26,171 $58,311
======= =======
ZEBRA TECHNOLOGIES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands)
(Unaudited)
Three Months Ended
------------------
March 31, 2012 April 2, 2011
-------------- -------------
Cash flows from operating activities:
Net income $30,164 $61,634
Adjustments to reconcile net income to net cash provided
by (used in)
operating activities:
Depreciation and amortization 5,959 5,932
Equity-based compensation 3,800 4,488
Excess tax benefit from
equity-based compensation (66) (645)
Loss on sale of property and
equipment 83 9
Gain on sale of business -- (67,213)
Deferred income taxes (391) 2,540
Changes in assets and liabilities:
Accounts receivable, net (1,862) 12,563
Inventories, net 7,169 (7,136)
Other assets 9,395 (1,690)
Accounts payable (3,378) (7,150)
Accrued liabilities (16,881) (17,120)
Deferred revenue 1,151 (15,749)
Income taxes 6,135 27,732
Other operating activities (4,725) (3,364)
Net cash provided by (used in)
operating activities 36,553 (5,169)
------ ------
Cash flows from investing activities:
Purchases of property and
equipment (7,654) (3,922)
Proceeds from the sale of
business 13,790 164,008
Purchases of investments and
marketable securities (132,390) (382,410)
Maturities of investments and
marketable securities 81,189 209,509
Proceeds from sales of
investments and marketable
securities 21,748 88,304
Net cash provided by (used in)
investing activities (23,317) 75,489
------- ------
Cash flows from financing activities:
Purchase of treasury stock (9,775) (41,567)
Proceeds from exercise of
stock options and stock
purchase plan purchases 1,998 2,757
Excess tax benefit from
equity-based compensation 66 645
Net cash used in financing
activities (7,711) (38,165)
------ -------
Effect of exchange rate
changes on cash -- 336
--- ---
Net increase in cash and cash
equivalents 5,525 32,491
Cash balance of discontinued
operations at beginning of
period -- 1,301
Less: Cash balance of
discontinued operations at
end of period -- 282
Cash and cash equivalents at
beginning of period 36,418 46,175
------ ------
Cash and cash equivalents at
end of period $41,943 $79,685
======= =======
Supplemental disclosures of cash flow information:
Income taxes paid $7,956 $8,958
ZEBRA TECHNOLOGIES CORPORATION
SUPPLEMENTAL SALES INFORMATION
(Amounts in thousands)
(Unaudited)
SALES BY PRODUCT CATEGORY
Three Months Ended
------------------
March 31, April 2, Percent Percent of Percent of
Product Category 2012 2011 Change Net Sales - 2012 Net Sales - 2011
---------------- ---- ---- ------ ---------------- ----------------
Hardware $181,196 $180,136 0.6 74.3 75.9
Supplies 49,962 44,635 11.9 20.5 18.8
Service and
software 11,399 11,181 1.9 4.7 4.7
------ ------ --- ---
Subtotal products 242,557 235,952 2.8 99.5 99.4
Shipping and
handling 1,318 1,349 (2.3) 0.5 0.6
Total net sales $243,875 $237,301 2.8 100.0 100.0
======== ======== ===== =====
SALES BY GEOGRAPHIC REGION
--------------------------
Three Months Ended
------------------
March 31, April 2, Percent Percent of Percent of
Geographic Region 2012 2011 Change Net Sales - 2012 Net Sales - 2011
----------------- ---- ---- ------ ---------------- ----------------
Europe, Middle
East and Africa $86,121 $84,230 2.2 35.3 35.5
Latin America 22,287 20,104 10.9 9.1 8.5
Asia-Pacific 33,148 32,495 2.0 13.6 13.7
------ ------ ---- ----
Total
International 141,556 136,829 3.5 58.0 57.7
North America 102,319 100,472 1.8 42.0 42.3
------- ------- ---- ----
Total net sales $243,875 $237,301 2.8 100.0 100.0
======== ======== ===== =====
ZEBRA TECHNOLOGIES CORPORATION
PRINTER UNITS and AVERAGE UNIT PRICES
(Unaudited)
Three Months Ended
------------------
March 31, April 2, Percent
2012 2011 Change
---- ---- ------
Total
printers
shipped 297,669 284,177 4.7
Average
selling
price
of
printers
shipped $503 $524 (4.0)
SOURCE Zebra Technologies Corporation
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