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OSI Systems Inc. Reports Operating Results (10-Q)

January 26, 2011 | About:
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10qk

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OSI Systems Inc. (OSIS) filed Quarterly Report for the period ended 2010-12-31.

Osi Systems Inc has a market cap of $695.2 million; its shares were traded at around $37.25 with a P/E ratio of 26 and P/S ratio of 1.1. Hedge Fund Gurus that owns OSIS: Kenneth Fisher of Fisher Asset Management, LLC, Jim Simons of Renaissance Technologies LLC. Mutual Fund and Other Gurus that owns OSIS: Chuck Royce of Royce& Associates.

Highlight of Business Operations:

Revenues for the Security division for the three months ended December 31, 2010, increased $17.6 million, or 30%, to $76.7 million, from $59.1 million for the comparable prior-year period. The increase was attributed to: (i) a $15.9 million, or 35% increase in equipment sales mainly driven by a $12.2 million increase in our baggage and parcel inspection, hold baggage screening and people screening equipment, as well as a $1.9 million increase in cargo and vehicle inspection equipment; and (ii) a $1.7 million or 13% increase in revenue related to contracts to service such equipment. The increase in service revenue was due to the growing installed equipment base, from which we derive service revenues as warranty periods expire.

Revenues for the Healthcare division for the three months ended December 31, 2010, decreased $1.2 million, or 2%, to $55.8 million, from $57.0 million for the comparable prior-year period. The decrease was primarily attributable to a $1.1 million decrease in cardiology product revenues.

Revenues for the Optoelectronics and Manufacturing division for the three months ended December 31, 2010, increased by $4.0 million, or 9%, to $47.7 million, from $43.7 million for the comparable prior-year period. This increase was primarily the result of a $6.9 million increase in commercial optoelectronics sales due to both a $5.2 million growth in sales to external customers as well as $1.7 million growth in intersegment sales, primarily to our Security division partially offset by expected decreases in contract manufacturing sales of $2.9 million primarily due to the winding down of a defense-industry related contract. Included in this total revenue amount for the three months ended December 31, 2010, the Optoelectronics and Manufacturing division recorded intersegment sales of $10.9 million, compared to $9.2 million in the comparable prior-year period as previously noted. Such intersegment sales are eliminated in consolidation.

Revenues for the Security division for the six months ended December 31, 2010, increased $21.4 million or 20%, to $127.8 million, from $106.4 million for the comparable prior-year period. The increase was attributed to: (i) an $18.6 million, or 23% increase in equipment sales mainly driven by a $19.1 million increase in our baggage and parcel inspection, hold baggage screening and people screening equipment; and (ii) a $2.8 million or 11% increase in revenue related to contracts to service such equipment. The increase in service revenue was due to the growing installed equipment base, from which we derive service revenues as warranty periods expire.

Revenues for the Healthcare division for the six months ended December 31, 2010, decreased $2.3 million, or 2%, to $101.7 million, from $104.0 million for the comparable prior-year period. The decrease was primarily due to: (i) a $2.3 million decrease in patient monitoring revenues mainly in North America; and (ii) a $1.0 million decrease in cardiology product revenues. These decreases were partially offset by a $1.3 million increase in anesthesia revenues.

Revenues for the Optoelectronics and Manufacturing division for the six months ended December 31, 2010, were virtually unchanged at $89.6 million as compared to $89.5 million for the comparable prior-year period. This was due to a $12.1 million increase in commercial optoelectronic revenues both due to growth in revenue to external customers as well as due to growth in intersegment sales, primarily to the Security division, offset by a $12.0 million decrease in contract manufacturing mainly driven by the expected winding down of a large defense-industry related contract. Included in this total revenue amount for the six months ended December 31, 2010, the Optoelectronics and Manufacturing division recorded intersegment sales of $21.4 million, compared to $15.5 million in the comparable prior-year period. Such intersegment sales are eliminated in consolidation.

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