Itron Inc. (ITRI, Financial) filed Quarterly Report for the period ended 2012-09-30.
Itron Inc. has a market cap of $1.62 billion; its shares were traded at around $39.94 with a P/E ratio of 9.8 and P/S ratio of 0.7. Itron Inc. had an annual average earning growth of 14.3% over the past 10 years. GuruFocus rated Itron Inc. the business predictability rank of 3.5-star.
Revenues decreased $111.5 million and $136.8 million, or 18% and 8%, for the three and nine months ended September 30, 2012, compared with the same periods last year. The net translation effect of our operations denominated in foreign currencies resulted in an unfavorable impact to revenues of $35.5 million and $83.1 million for the three and nine months ended September 30, 2012, compared with the same periods in 2011. A more detailed analysis of these fluctuations is provided in Operating Segment Results.
Energy operating expenses decreased $215.8 million, or 69.5%, for the three months ended September 30, 2012, compared with the same period last year, primarily due to the goodwill impairment of $216.1 million recognized in 2011, favorable foreign currency translation impact of $5.9 million, and scheduled decreases in amortization of intangible assets. These decreases were offset by increased sales and marketing costs and product development costs for the development of new and enhanced products. Apart from the goodwill impairment and restructuring, operating expenses as a percentage of revenues were 25% for the three months ended September 30, 2012, compared with 19% for the same period last year. Itron Cellular Solutions, formerly SmartSynch, contributed $5.5 million of operating expenses during the third quarter of 2012.
For the first nine months of 2012, Energy operating expenses decreased $211.2 million, or 42%, compared with 2011, primarily due to the goodwill impairment of $216.1 million recognized in 2011, favorable foreign currency translation impact of $13.6 million during the nine months ended September 30, 2012, and scheduled decreases in amortization of intangible assets. These decreases were offset by increased sales and marketing and product development costs for development of new and enhanced products and $1.7 million in increased restructuring expenses. Operating expenses, excluding the goodwill impairment and restructuring, as a percentage of revenues were 23% for the nine months ended September 30, 2012, compared with 21% for the same period last year. Itron Cellular Solutions contributed $10.2 million of operating expenses since the acquisition on May 1, 2012.
Operating expenses decreased $548.4 million and $533.0 million for the three and nine months ended September 30, 2012, compared with the same periods last year, primarily due to the absence of goodwill impairment in 2012 compared with $540.4 million of goodwill impairment recognized during the three and nine months ended September 30, 2011. In addition, there was a scheduled decrease in amortization of intangible assets of $4.1 and $11.9 million and a favorable impact from foreign currency translation of $47.6 million and $59.1 million for the three and nine months ended September 30, 2012. These decreases were partially offset by increased sales and marketing and product development costs for development of new and enhanced products, acquisition related expenses for the SmartSynch acquisition of $44,000 and $3.0 million for the three and nine months ended September 30, 2012. In addition, we incurred approximately $616,000 and $3.4 million during the three and nine months ended September 30, 2012 for management training and development costs in connection with the implementation of our new organization and for preliminary planning costs, prior to application development, for our global ERP software initiative which commenced in the third quarter of 2012.
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Itron Inc. has a market cap of $1.62 billion; its shares were traded at around $39.94 with a P/E ratio of 9.8 and P/S ratio of 0.7. Itron Inc. had an annual average earning growth of 14.3% over the past 10 years. GuruFocus rated Itron Inc. the business predictability rank of 3.5-star.
Highlight of Business Operations:
Revenues for the three and nine months ended September 30, 2012 were $504 million and $1.7 billion, compared with $616 million and $1.8 billion for the same periods last year. Fluctuations in foreign currency exchange rates unfavorably impacted revenues by $35 million and $83 million for the three and nine months ended September 30, 2012. Excluding the foreign currency translation impact, revenues decreased during these same periods in 2012 due to our five largest OpenWay projects in North America nearing completion, lower gas module shipments in North America, and lower Energy product shipments in Asia/Pacific, the combination of which was partially offset by an increase in Water revenue. Gross margin for the third quarter of 2012 was 34.1%, compared with a gross margin of 28.8% for the same period last year. Gross margin for the nine months ended September 30, 2012 was 33.3% compared with a gross margin of 30.9% for the corresponding period in 2011. Reduced warranty costs accounted for gross margin improvement of 5.4 percentage points for the quarter and 1.9 percentage points for the nine month period in 2012.Revenues decreased $111.5 million and $136.8 million, or 18% and 8%, for the three and nine months ended September 30, 2012, compared with the same periods last year. The net translation effect of our operations denominated in foreign currencies resulted in an unfavorable impact to revenues of $35.5 million and $83.1 million for the three and nine months ended September 30, 2012, compared with the same periods in 2011. A more detailed analysis of these fluctuations is provided in Operating Segment Results.
Energy operating expenses decreased $215.8 million, or 69.5%, for the three months ended September 30, 2012, compared with the same period last year, primarily due to the goodwill impairment of $216.1 million recognized in 2011, favorable foreign currency translation impact of $5.9 million, and scheduled decreases in amortization of intangible assets. These decreases were offset by increased sales and marketing costs and product development costs for the development of new and enhanced products. Apart from the goodwill impairment and restructuring, operating expenses as a percentage of revenues were 25% for the three months ended September 30, 2012, compared with 19% for the same period last year. Itron Cellular Solutions, formerly SmartSynch, contributed $5.5 million of operating expenses during the third quarter of 2012.
For the first nine months of 2012, Energy operating expenses decreased $211.2 million, or 42%, compared with 2011, primarily due to the goodwill impairment of $216.1 million recognized in 2011, favorable foreign currency translation impact of $13.6 million during the nine months ended September 30, 2012, and scheduled decreases in amortization of intangible assets. These decreases were offset by increased sales and marketing and product development costs for development of new and enhanced products and $1.7 million in increased restructuring expenses. Operating expenses, excluding the goodwill impairment and restructuring, as a percentage of revenues were 23% for the nine months ended September 30, 2012, compared with 21% for the same period last year. Itron Cellular Solutions contributed $10.2 million of operating expenses since the acquisition on May 1, 2012.
Operating expenses decreased $548.4 million and $533.0 million for the three and nine months ended September 30, 2012, compared with the same periods last year, primarily due to the absence of goodwill impairment in 2012 compared with $540.4 million of goodwill impairment recognized during the three and nine months ended September 30, 2011. In addition, there was a scheduled decrease in amortization of intangible assets of $4.1 and $11.9 million and a favorable impact from foreign currency translation of $47.6 million and $59.1 million for the three and nine months ended September 30, 2012. These decreases were partially offset by increased sales and marketing and product development costs for development of new and enhanced products, acquisition related expenses for the SmartSynch acquisition of $44,000 and $3.0 million for the three and nine months ended September 30, 2012. In addition, we incurred approximately $616,000 and $3.4 million during the three and nine months ended September 30, 2012 for management training and development costs in connection with the implementation of our new organization and for preliminary planning costs, prior to application development, for our global ERP software initiative which commenced in the third quarter of 2012.
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