American Science and Engineering [ASEI]
2Q12 2Q11
Sales $54.8M $80.6M
Net Inc. $6.9M, 0.74 $14.7M, 1.59
Net income tumbled 53% on a 32% drop in sales. Margins declined on a one time inventory reserve, higher labor material costs on service work and higher research and development expense. Lower sales in cargo and Z Backscatter Systems more than offset gains in parcel and filed service revenues. The sales breakout by category is as follows: cargo, $9.2M; Z Backscatter Systems, $17.5M; parcel, $3.1M; field service, $23.9M; and contract research and development, $1.1M. Bookings were higher than sales at $93.5M but still less than the $116.2M a year ago. Backlog stood at $211.2M, a 17% decline from the $254.3M a year ago. Company officials say they are still “seeing the effects of global economic uncertainty.” Still, the pipeline of opportunities remains strong and has improved slightly since the first quarter, they say. The volume of international opportunities is increasing at a high rate, they add. The company remains confident in its outlook, boosting its quarterly dividend as a result by 20 cents to 50 cents per share. Free cash flow in the quarter was $22.4M.
OSI Systems [OSIS]
1Q12 1Q11
Sales $161.3M $128.5M
Net Inc. $4.8M, 0.24 $3.4M, 0.18
Sales were a quarterly record, up 26% from a year ago, driven by strong growth at the Security business, followed by strong growth at the Optoelectronics and Manufacturing division. The Healthcare division eked out at 1% sales gain. Net income increased 41%. Sales at the Security division, Rapiscan Systems, increased 42% to $72.6M and operating income soared 80% to $3.8M. Cost overrun on a project integration project Rapiscan is doing at some airports in Mexico are largely behind the company. Overall, OSI’s backlog reached a record $413M, driven by a record backlog at Rapiscan of $319M, which is up 59% since the end of FY11. The increase was driven by the recent $98M Army order for systems integration and security equipment under the entry control point contract. Bookings at Rapiscan were $185 million. The company increased its sales outlook for the fiscal year to between $740M-$760M versus the previous guidance of $722M-$740M and its earnings per share to between $2.27-$2.40 versus previous guidance of between $2.21-$2.32. Free cash flow was $7M in the quarter.