OSI Systems [OSIS]
1Q21 1Q20
Sales $254.9M $290.9M
Net Inc. $9.3M, $0.51 $20.7M, $1.10
Sales tumbled 12% on a 29% drop at the Security segment to $134.8million, which continues to suffer due to impacts from the ongoing COVID-19 pandemic. The coronavirus is limiting travel and getting people in place to install equipment, including at airports, ports and borders, Deepak Chopra, OSI’s CEO, said during the company’s earnings call. Bid activity remains strong, he added. The decline at the security segment more than offset a handsome topline increase at the Healthcare segment. The fall in net income was essentially all due to a 57% plunge in the Security business to $8.9 million, again due to COVID impacts limiting sales. Not all is gloom and doom. The company’s bookings were 1.6 times sales and Security bookings tallied $254 million, driving backlog up 17% to $1 billion since the start of the fiscal year. Free cash flow was a robust $50 million. Given strength in all the company’s business lines, OSI boosted its outlook for the year, with adjusted earnings now expected to be between $4.65 and$5.10 EPS versus the prior guidance of between $4.50 and $5.05. Sales are pegged to be a bit higher as well, between $1.1 billion and $1.142 billion versus the prior outlook of between $1.09 billion and $1.14 billion. In fiscal year 2020 the company generated $60 million in sales from a turnkey security services contract with Mexico that has since ended. OSI had expected $30 million in sales from the contract in FY ’21 but for now, nothing.