OSI Systems(US:OSIS)2024-01-26 21:00Financial Performance - Total net revenues for the six months ended December 31, 2023, increased to $652,445,000, up 15.7% from $563,668,000 in the same period of 2022[9] - Net income for the three months ended December 31, 2023, was $36,553,000, representing a 123.5% increase compared to $16,354,000 in the same period of 2022[11] - Gross profit for the six months ended December 31, 2023, rose to $240,046,000, a 30.5% increase from $183,704,000 in the same period of 2022[9] - Net income for the six months ended December 31, 2023, increased to $49,432 thousand, up from $27,589 thousand in the same period of 2022, representing an increase of 79%[16] - Basic earnings per share for the six months ended December 31, 2023, rose to $2.92, compared to $1.63 for the same period in 2022, reflecting an increase of 79%[20] - The company reported a diluted earnings per share of $2.11 for the three months ended December 31, 2023, compared to $0.96 for the same period in 2022, marking a 119.8% increase[9] - Total revenues for the six months ended December 31, 2023, were $652,445,000, an increase from $563,668,000 in the same period of 2022, representing a growth of 15.7%[86] Cash and Liquidity - Cash and cash equivalents decreased to $76,750,000 as of June 30, 2023, down from $127,258,000 as of December 31, 2022[8] - Cash and cash equivalents at the end of the period totaled $127,258 thousand, a significant increase from $45,600 thousand at the end of the previous year[16] - Cash and cash equivalents increased by $50.5 million, or 65.8%, to $127.3 million at December 31, 2023, from $76.8 million at June 30, 2023[133] - As of December 31, 2023, cash and cash equivalents totaled $127.3 million, with approximately 92% held by foreign subsidiaries[141] Assets and Liabilities - Total current liabilities decreased to $571,694,000 as of June 30, 2023, from $700,391,000 as of December 31, 2022, reflecting a reduction of approximately 18.3%[8] - Total assets decreased to $1,555,686,000 as of June 30, 2023, from $1,726,477,000 as of December 31, 2022, a decline of approximately 9.9%[8] - The company’s retained earnings as of December 31, 2023, were $782,508,000, down from $735,957,000 as of June 30, 2023[13] - The warranty provision balance at the end of the period was $10,496,000, down from $10,734,000 at the beginning of the period[76] Research and Development - Research and development expenses for the six months ended December 31, 2023, were $32,272,000, up from $28,996,000 in the same period of 2022, indicating a growth of 7.9%[9] - Research and development expenses for YTD Q2 fiscal 2024 increased by $3.3 million, or 11.4%, to $32.3 million, primarily due to compensation costs related to new product development initiatives[129] Acquisitions and Investments - In December 2023, the company acquired a privately held contract manufacturer for approximately $6.3 million, financed with cash on hand[33] - In October 2023, the company acquired a provider of radiation detection technology for approximately $2.8 million, plus up to $3.6 million in potential contingent consideration[34] Revenue by Division - The Security division generated revenues of $414,604,000 for the six months ended December 31, 2023, up from $312,436,000 in the prior year, reflecting a growth of 32.8%[86] - Revenues from the Security division accounted for 64% of total consolidated revenues for the six months ended December 31, 2023, up from 55% in the same period of 2022[94] - The Security division's revenues increased by 49.3% year-over-year in Q2 fiscal 2024, reaching $250 million, driven by growth in cargo and vehicle inspection systems sales[111] - The Optoelectronics and Manufacturing division's revenues decreased by 3.8% year-over-year in Q2 fiscal 2024, totaling $81.4 million[113] - The Healthcare division's revenues decreased by 3.9% year-over-year in Q2 fiscal 2024, primarily due to a reduction in patient monitoring sales of $4.8 million[114] Operating Expenses - Total operating expenses for YTD Q2 fiscal 2024 were $165.2 million, an increase of $25.3 million, or 18.1%, from $139.9 million in the same prior-year period[128] - The company recognized $1.5 million in restructuring and other charges for the six months ended December 31, 2023, compared to $3.5 million for the same period in 2022[50] Market Conditions and Risks - The company faces uncertainties due to global economic factors, including inflationary pressures and supply chain disruptions, which may impact demand for its products and services[98] - The ongoing conflict between Russia and Ukraine has increased global economic and political uncertainty, potentially disrupting the company's supply chain and access to resources[106] Tax and Compliance - The effective tax rate for the six months ended December 31, 2023, was 21.0%, compared to 21.6% for the same period in 2022[83] - The company recognized a net discrete tax benefit of $2.3 million from changes in prior year tax estimates during the six months ended December 31, 2023[83] Other Financial Metrics - Interest expense related to the credit facility increased from $5.0 million in Q4 2022 to $7.0 million in Q4 2023[55] - Stock-based compensation expense for Q4 2023 was $7.328 million, slightly up from $7.239 million in Q4 2022[59] - Total unrecognized compensation cost related to share-based compensation grants was estimated at $1.2 million for stock options and $23.8 million for restricted stock units as of December 31, 2023[59]