Zebra Technologies Announces 2011 Fourth Quarter Financial Results:
Strength in North America and Europe lead to favourable results
Lincolnshire, IL, February 14, 2012─Zebra Technologies Corporation (NASDAQ: ZBRA) today announced 2011 fourth quarter net income of $35,044,000, or $0.67 per diluted share, compared with $28,217,000, or $0.50 per diluted share, for the fourth quarter of 2010.
Quarterly net income for 2011 includes income of $2,185,000, or $0.04 per diluted share, from discontinued operations. Net sales for the quarter ended December 31, 2011, increased 5.7% to $247,308,000 from $234,019,000 for the corresponding period for 2010.
"The great diversity of Zebra's business and excellent execution on several fronts contributed to our solid fourth quarter results," stated Anders Gustafsson, Zebra's chief executive officer. "During 2011, Zebra increased the pace of innovation with the introduction of 13 new printer products and 10 location software and hardware releases. Through our strategic sales and marketing activities, we built relationships with a broader base of customers to penetrate targeted industries more deeply. Our investments to extend geographic reach have resulted in improved coverage in attractive high-growth regions. These actions position Zebra for further profitable growth and the capacity for creating greater shareholder value."
For all of 2011, net sales increased 10.0% to a record $983,488,000 from $894,359,000 for 2010. Annual income from continuing operations was $130,343,000, or $2.40 per diluted share, compared with $104,614,000, or $1.82 per diluted share. Net income for 2011 was $174,643,000, or $3.22 per diluted share, which was up from $101,778,000, or $1.77 per diluted share, for 2010.
As of December 31, 2011, Zebra had $326,695,000 in cash and investments, and no long-term debt. Net inventories were $133,288,000, and net accounts receivable were $155,230,000.
Discussion and Analysis
- Net sales for the fourth quarter of 2011 benefited primarily from particularly strong business activity in the company's North American and Europe, Middle East and Africa (EMEA) regions. Quarterly sales increased 5.9% on a constant-currency basis from a year ago.
- Gross margin of 49.1%, versus 48.9% a year ago, reflects lower costs for raw materials and higher volumes, partially offset by less favourable movements in foreign exchange rates.
- Operating expense growth of 11.3% includes higher employee-related payroll and benefit costs driven by increased headcount from a year ago and higher market development activities primarily to support the company's geographic expansion activities. The company also held a global partner conference in 2011, not held in the prior year. Operating profit margin decreased from 18.4% to 17.0% due to the increases in selling and marketing expenses and a modest increase in research and development costs.
Stock Purchase Update
During the fourth quarter of 2011, Zebra repurchased 428,891 shares of Zebra Technologies Corporation Class A Common Stock.
At December 31, 2011, the company had 3,496,199 shares remaining in its stock buyback authorization, and 52,095,000 shares of common stock were outstanding.
First Quarter Outlook
Zebra announced its financial forecast for the first quarter of 2012. Net sales are expected within a range of $237,000,000 to $246,000,000. Diluted earnings per share from continuing operations are expected within a range of $0.52 to $0.59.
Conference Call Notification
Investors are invited to listen to a live webcast of Zebra's conference call discussing the company's financial results for the fourth quarter of 2011. The conference call will be held at 11:00 AM Eastern Time today. To listen to the call, visit the company's website at www.zebra.com.
This press release contains forward-looking statements, as defined by the Private Securities Litigation Reform Act of 1995, including, without limitation, the statements regarding the company's financial forecast for the first quarter of 2012 stated in the paragraph above captioned "First Quarter Outlook."
Actual results may differ from those expressed or implied in the company's forward-looking statements. These statements represent estimates only as of the date they were made. Zebra undertakes no obligation, other than as may be required by law, to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason after the date of this release.
These forward-looking statements are based on current expectations, forecasts and assumptions and are subject to the risks and uncertainties inherent in Zebra's industry, market conditions, general domestic and international economic conditions, and other factors. These factors include customer acceptance of Zebra's hardware and software products and competitors' product offerings, and the potential effects of technological changes.
The continued uncertainty over future global economic conditions, the availability of credit, capital markets volatility, may have adverse effects on Zebra, its suppliers and its customers. In addition, a disruption in our ability to obtain products from vendors as a result of supply chain constraints, natural disasters or other circumstances could restrict sales and negatively affect customer relationships. Profits and profitability will be affected by Zebra's ability to control manufacturing and operating costs.
Because of a large investment portfolio, interest rates and financial market conditions will also have an impact on results. Foreign exchange rates will have an effect on financial results because of the large percentage of our international sales. The outcome of litigation in which Zebra may be involved is another factor. These and other factors could have an adverse effect on Zebra's sales, gross profit margins and results of operations and increase the volatility of our financial results.
When used in this release and documents referenced, the words "anticipate," "believe," "estimate," and "expect" and similar expressions, as they relate to the company or its management, are intended to identify such forward-looking statements, but are not the exclusive means of identifying these statements. Descriptions of the risks, uncertainties and other factors that could affect the company's future operations and results can be found in Zebra's filings with the Securities and Exchange Commission. In particular, readers are referred to Zebra's Form 10-K for the year ended December 31, 2010.
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About Zebra Technologies
A global leader respected for innovation and reliability, Zebra Technologies Corporation (NASDAQ: ZBRA) provides enabling technologies that allow customers to take smarter actions. Our extensive portfolio of barcode, receipt, card, kiosk and RFID printers and supplies, as well as real-time location solutions give a digital voice to assets, people and transactions that provides greater visibility into mission-critical information. For more information about Zebra's solutions, visit www.zebra.com.