Business News

Zebra Technologies Announces Record Sales and Earnings for the 2013 Third Quarter

Thursday 07. November 2013 - Improving business conditions lead to record sales in North America and Asia Pacific; Profitability increases for second consecutive quarter

Zebra Technologies Corporation (NASDAQ: ZBRA) today announced 2013 third quarter diluted earnings per share from continuing operations of a record $0.76, including exit, restructuring and acquisition costs that reduced earnings by $0.01 per share. Income from continuing operations for the third quarter of 2012 totaled $0.51 per share, which included acquisition costs and a non-cash asset impairment charge that reduced earnings by $0.19 per share. Net sales for the quarter ended September 28, 2013, increased 4.6% to a record $263,523,000 from $252,037,000 for the third quarter of 2012.
“A steady run-rate business through the quarter complemented an improving pipeline for large enterprise deals, as we continued to extend Zebra’s industry leadership,” stated Anders Gustafsson, Zebra’s chief executive officer. “Favorable trends with customers in manufacturing, retail and healthcare, are resulting from our success in developing strong channels and securing tighter engagements with strategic customers. Zebra’s expanding range of products and solutions are enabling our customers to gain greater visibility across their value chains. Zebra remains well positioned to benefit from important technology trends such as the Internet of Things, Big Data and Cloud Computing which are creating new opportunities for growth and shareholder value creation.”
As of September 28, 2013, Zebra had $466,325,000 in cash and investments, and no long-term debt. Net inventories were $106,628,000, and net accounts receivable were $175,639,000.
For the first nine months of 2013, net sales were $753,620,000, compared with $742,989,000 for the first nine months of 2012. Net income for the nine months ending September 28, 2013, was $92,708,000, or $1.81 per diluted share, compared with $87,914,000, or $1.69 per diluted share, for the same period in 2012.
Discussion and Analysis – Third Quarter
— Net sales growth of 4.6% included sales growth in all regions, including
record sales in North America and Asia Pacific. The increase was
primarily due to high sales of supplies, aftermarket parts and services.
The 11.7% growth in supplies, which include labels, thermal ribbons and
wristbands, was all on an organic basis.
— Gross profit margin of 48.8%, versus 50.4% for 2012, reflects changes in
product mix and higher costs for freight-in.
— Operating expenses decreased by 7.2%, principally from a goodwill
impairment charge of $9,114,000 in 2012. Operating expenses before the
impairment charge increased 3.5% from higher compensation costs and
outside professional services, as well as increased amortization and
exit and restructuring costs.
— The effective income tax rate for 2013 reflects the impact of a higher
proportion of income generated in jurisdictions with lower tax rates. In
addition, the 2012 rate includes the effect of a non-deductible non-cash
asset impairment charge.
Stock Purchase Update
During the third quarter of 2013, Zebra returned $29,896,000 to shareholders through the repurchase of 641,719 shares of Zebra Technologies Corporation Class A Common Stock at a weighted average price of $46.59 per share. At September 28, 2013, the company had 753,575 shares remaining in its stock buyback authorization, and 50,229,576 shares of common stock were outstanding.
Fourth Quarter Outlook
Zebra announced its financial forecast for the fourth quarter of 2013. Net sales are expected within a range of $263,000,000 to $273,000,000. Diluted earnings per share are expected within a range of $0.72 to $0.82.