Itron, Inc. (NASDAQ:ITRI) reported financial results for its fourth quarter and full-year ended December 31, 2006.
Highlights include:
Quarterly and full-year revenues of $160 million and $644 million;
Quarterly and full-year new order bookings of $211 million and $652 million;
Quarterly and full-year GAAP diluted EPS of $.28 and $1.28;
Quarterly and full-year non-GAAP diluted EPS of $.56 and $2.39; and
Full-year cash flows from operations of $95 million.
“2006 was a banner year for Itron,” said LeRoy Nosbaum, chairman and CEO. “We set new records for revenue, backlog, non-GAAP earnings per share and cash flow from operations. We delivered results to our shareholders while continuing to build a platform to drive growth.”
For the year, revenue was $644 million, an increase of 16.5% over 2005 revenue of $553 million. Gross margin of 41.5% in 2006 was lower than gross margin of 42.3% in 2005 due primarily to an increase in lower margin installation revenue in 2006.
For Q4, revenue was $160 million, equal to revenue in the fourth quarter of 2005 although 250,000 fewer electricity meters were shipped in the 2006 quarter due to the substantial completion of the Progress Energy contract.
Gross margin of 40.1% was slightly lower than the 40.5% in 2005 due primarily to shipments of our first-generation advanced metering infrastructure (AMI) meters, which have higher costs as expected.
“We had excellent financial results for both the quarter and the year,” said Nosbaum. “Although our fourth quarter net income was slightly less than we would have liked, it was caused in part by activities that Itron will eventually benefit from, including our initial AMI product shipments and related development efforts. The AMI products were shipped at lower than normal margins because they are new, which we expected. We also incurred legal and accounting charges related to a potential acquisition opportunity that came up during the quarter. We did not complete the acquisition, but felt that evaluating the opportunity was in our best interest.”
Outlook for 2007:
Revenues between $680 and $700 million;
Diluted non-GAAP EPS of between $2.70 and $2.90 (excludes approximately $0.27 – $0.31 of stock-based compensation expense);
Adjusted EBITDA of $130 to $135 million; and First quarter revenues between $140 and $150 million.
About Itron:
Nearly 3,000 utilities worldwide rely on Itron technology to deliver the knowledge they require to optimize the delivery and use of energy and water. Itron delivers value to its clients by providing industry-leading solutions for electricity metering, meter data collection, energy information management, demand side management and response, load forecasting, analysis and consulting services, distribution system design and optimization, Web-based workforce automation, commercial and industrial customer care and residential energy management.
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