Updates Full-Year 2016 Guidance to Reflect
Strong Business Momentum
Announces New Restructuring Projects; Targeting
Additional Annualized Cost Savings of Approximately $40 Million
Itron, Inc. (NASDAQ:ITRI) announced today financial results for
its second quarter ended June 30, 2016. Highlights for the quarter
include:
- Revenues of $513 million, an increase
of 9 percent from the second quarter 2015;
- Gross margin of 33.1 percent, an
increase of 790 basis points;
- GAAP diluted earnings per share of 52
cents, compared with a loss of 37 cents per diluted share in the
second quarter 2015; and
- Non-GAAP diluted earnings per share of
65 cents, compared with a loss of 39 cents per diluted share in the
2015 period.
“We are pleased with our second quarter results, which reflect
continued success with our smart meters in North America and EMEA
and further progress on our cost saving initiatives,” said Philip
Mezey, Itron’s president and chief executive officer. “In the
second quarter we delivered significantly improved financial
performance as compared to the prior year, including revenue growth
of more than 10 percent, excluding foreign currency impacts.
Following a great start to 2016, we have updated our full year
guidance to reflect Itron’s strong business momentum and prospects
for continued success in the second half of 2016.”
Mezey added, “As we continue to realize benefits from our 2014
restructuring initiatives, we remain focused on our ongoing efforts
to drive operational improvements as well as product development
and supply chain efficiencies across our business. Accordingly, we
announced new restructuring projects to further reduce expenses
through streamlining our global operations. We expect to achieve
additional annualized cost savings of approximately $40 million by
the end of 2018 from these projects.”
Summary of Second Quarter Consolidated Financial
Results(All comparisons made are against the prior year period
unless otherwise noted)
Revenue
Total revenue for the quarter grew 9 percent to $513 million
compared with $471 million in 2015. Changes in foreign currency
exchange rates unfavorably impacted revenue by approximately $7
million for the quarter. Excluding the impact of foreign currency,
revenues increased $49 million, or 10 percent, driven by growth in
all segments, particularly in the Electricity and Gas segments.
Total advanced and smart meter volumes increased 25 percent
primarily due to smart metering projects in North America and
Europe. Electricity revenues grew 14 percent with growth in all
regions and Gas revenues grew 8 percent driven by smart meters in
Europe and a record level of North American revenue. Revenues in
the Water segment grew 2 percent compared with the prior year.
Gross Margin
Gross margin for the quarter increased to 33.1 percent compared
with the prior year period margin of 25.2 percent, with increases
in all segments. The improvement was driven by lower warranty
expense, favorable product mix and operational efficiencies. In the
prior year period, the company recorded a warranty expense of $23.6
million in the Water segment, which negatively impacted gross
margin by approximately 500 basis points in that quarter.
Operating Expenses
Operating expenses for the quarter were $134 million compared
with $123 million in 2015. The increase was primarily driven by
higher general and administrative (“G&A”) costs related to
professional fees associated with the company’s review of software
related revenue recognition and revision of previously issued
financial statements in the 2015 Annual Report on Form 10-K. In
addition, GAAP G&A costs were $4.6 million lower in the prior
year period as a result of an expense recovery from a litigation
matter associated with a prior acquisition.
Non-GAAP operating expenses were $128 million, an increase of $5
million compared with 2015, due to the higher G&A costs for
professional fees associated with the review of software related
revenue recognition and revision of previously issued financial
statements.
GAAP Operating Income, Net Income,
Earnings per Share
GAAP operating income improved to $35 million for the quarter
compared with an operating loss of $4 million in 2015. Net income
for the quarter was $20 million, or 52 cents per diluted share,
compared with a net loss of $14 million, or 37 cents per diluted
share. The increases in operating income and net income for the
quarter reflected the strong performance in revenue and gross
margin.
Non-GAAP Operating Income, Net Income,
Earnings per Share
Non-GAAP operating income improved to $42 million for the
quarter compared with an operating loss of $5 million. Non-GAAP net
income for the quarter was $25 million, or 65 cents per diluted
share, compared with a net loss of $15 million, or 39 cents per
share. The increases in non-GAAP operating and net income for the
quarter reflected the strong performance in revenue and gross
margin.
Cash Flow
Net cash provided by operating activities was $17 million in the
second quarter of 2016 compared with $22 million in 2015. Free cash
flow was $6 million for the second quarter compared with $10
million in the prior year quarter. The decrease in free cash flow
was primarily due to increased tax payments, prepayments on
software programs and working capital requirements.
Other Measures
Total backlog was $1.3 billion and twelve-month backlog was $688
million at the end of the quarter. Bookings in the quarter totaled
$349 million, reflecting a number of diverse bookings in all
segments across many customers.
Financial Guidance Update – Full Year 2016
Itron’s guidance for the full year 2016 is as follows:
- Revenue between $1.95 and $2.0
billion
- Non-GAAP diluted EPS between $2.20 and
$2.45
This guidance assumes current currency exchange rates for the
remaining portion of the year, average shares outstanding of
approximately 38 million for the year and a non-GAAP effective tax
rate for the year of approximately 37 percent.
With respect to the company’s expectations for the full year,
the company has not reconciled non-GAAP diluted earnings per share
to GAAP diluted earnings per share due to the inherent difficulty
in forecasting restructuring charges, which is a reconciling item
between the non-GAAP and GAAP measure. Due to the uncertain effect,
timing and potential significance of such charges that will impact
GAAP net earnings, the company is not able to provide such
guidance.
Operational Update
The company filed a Form 8-K today announcing projects to
restructure its operations. These projects will improve operational
efficiency, reduce expenses and improve our
competitiveness. The company expects to close or consolidate
several facilities and reduce its global workforce as a result of
the restructuring. Certain projects will begin immediately and we
target to substantially complete the activities by the end of 2018.
We forecast annualized savings of approximately $40 million upon
completion of these projects. We expect to incur pre-tax
restructuring charges of approximately $55 to $65 million related
to these projects. As many of our employees are represented by
unions or works councils, any specific employment actions related
to the projects may be subject to legal requirements, including
prior consultation on the projects with work councils and
authorities in some of the countries in which Itron operates. This
may affect the timing of the charges and planned savings in certain
jurisdictions. See the Form 8-K for further details on the
restructuring.
Update on Second Quarter 2016 Form 10-Q Filing
The company expects to file its Form 10-Q for the second quarter
no later than Sept. 12, 2016, remediating its delinquency in its
Quarterly Reports.
Earnings Conference Call
Itron will host a conference call to discuss the financial
results and guidance contained in this release at 4:30 p.m. Eastern
Time on Sept. 1, 2016. The call will be webcast in a listen-only
mode. Webcast information and conference call materials will be
made available 10 minutes before the start of the call and will be
accessible on Itron’s website at
http://investors.itron.com/events.cfm. A replay of the audio
webcast will be made available at
http://investors.itron.com/events.cfm. A telephone replay of the
conference call will be available through Sept. 6, 2016. To access
the telephone replay, dial (888) 203-1112 (Domestic) or (719)
457-0820 (International) and enter passcode 833920.
About Itron
Itron is a world-leading technology and services company
dedicated to the resourceful use of energy and water. We provide
comprehensive solutions that measure, manage and analyze energy and
water. Our broad product portfolio includes electricity, gas, water
and thermal energy measurement devices and control technology;
communications systems; software; as well as managed and consulting
services. With thousands of employees supporting nearly 8,000
customers in more than 100 countries, Itron applies knowledge and
technology to better manage energy and water resources. Together,
we can create a more resourceful world. Join us: www.itron.com.
Itron® is a registered trademark of Itron, Inc.
Forward-Looking Statements
This release contains forward-looking statements within in the
meaning of the Private Securities Litigation Reform Act of 1995.
These statements relate to our expectations about revenues,
operations, financial performance, earnings, earnings per share,
cash flows and restructuring activities including headcount
reductions and other cost savings initiatives. Although we believe
the estimates and assumptions upon which these forward-looking
statements are based are reasonable, any of these estimates or
assumptions could prove to be inaccurate and the forward-looking
statements based on these estimates and assumptions could be
incorrect. Our operations involve risks and uncertainties, many of
which are outside our control, and any one of which, or a
combination of which, could materially affect our results of
operations and whether the forward-looking statements ultimately
prove to be correct. Actual results and trends in the future may
differ materially from those suggested or implied by the
forward-looking statements depending on a variety of factors. Some
of the factors that we believe could affect our results include our
ability to execute on our restructuring plan, our ability to
achieve estimated cost savings, the rate and timing of customer
demand for our products, rescheduling of current customer orders,
changes in estimated liabilities for product warranties, adverse
impacts of litigation, changes in laws and regulations, our
dependence on new product development and intellectual property,
future acquisitions, changes in estimates for stock-based and bonus
compensation, increasing volatility in foreign exchange rates,
international business risks and other factors that are more fully
described in our Annual Report on Form 10-K for the year ended
December 31, 2015 and other reports on file with the Securities and
Exchange Commission. Itron undertakes no obligation to update or
revise any information in this press release.
Non-GAAP Financial Information
To supplement our consolidated financial statements presented in
accordance with GAAP, we use certain non-GAAP financial measures,
including non-GAAP operating expense, non-GAAP operating income,
non-GAAP net income, non-GAAP diluted EPS, adjusted EBITDA,
constant currency and free cash flow. We provide these non-GAAP
financial measures because we believe they provide greater
transparency and represent supplemental information used by
management in its financial and operational decision making. We
exclude certain costs in our non-GAAP financial measures as we
believe the net result is a measure of our core business. The
company believes these measures facilitate operating performance
comparisons from period to period by eliminating potential
differences caused by the existence and timing of certain expense
items that would not otherwise be apparent on a GAAP basis. GAAP
performance measures should be considered in addition to, and not
as a substitute for, results prepared in accordance with GAAP. Our
non-GAAP financial measures may be different from those reported by
other companies. A more detailed discussion of why we use non-GAAP
financial measures, the limitations of using such measures, and
reconciliations between non-GAAP and the nearest GAAP financial
measures are included in this press release.
Statements of operations, segment information, balance sheets,
cash flow statements and reconciliations of non-GAAP financial
measures to the most directly comparable GAAP financial measures
follow.
ITRON, INC. CONSOLIDATED STATEMENTS OF
OPERATIONS (Unaudited, in thousands, except per share
data)
Three Months Ended June 30, Six Months Ended June 30,
2016 2015 2016
2015 Revenues $ 513,024 $ 470,811 $ 1,010,614 $ 917,557 Cost
of revenues 343,319 352,257
677,706 660,581
Gross profit 169,705 118,554 332,908 256,976 Operating
expenses Sales and marketing 39,376 43,058 80,143 84,085 Product
development 43,354 43,318 88,700 84,840 General and administrative
45,328 32,492 90,397 72,077 Amortization of intangible assets 7,796
7,888 14,006 15,861 Restructuring (1,622 )
(4,234 ) 615 (9,415 )
Total operating expenses 134,232
122,522 273,861 247,448
Operating income (loss) 35,473 (3,968 ) 59,047 9,528
Other income (expense) Interest income 221 212 492 260 Interest
expense (2,735 ) (3,855 ) (5,653 ) (6,537 ) Other income (expense),
net (264 ) (1,905 ) (1,781 )
(1,884 ) Total other income (expense)
(2,778 ) (5,548 ) (6,942 )
(8,161 ) Income (loss) before income taxes
32,695 (9,516 ) 52,105 1,367 Income tax provision (12,193 )
(4,098 ) (20,819 )
(9,128 ) Net income (loss) 20,502 (13,614 ) 31,286 (7,761 ) Net
income attributable to non-controlling interests 585
732 1,280
1,187 Net income (loss) attributable to Itron, Inc. $
19,917 $ (14,346 ) $ 30,006
$ (8,948 ) Earnings (loss) per common share -
Basic $ 0.52 $ (0.37 ) $ 0.79
$ (0.23 ) Earnings (loss) per common share - Diluted $ 0.52
$ (0.37 ) $ 0.78 $ (0.23
) Weighted average common shares outstanding - Basic
38,236 38,434 38,147 38,438 Weighted average common shares
outstanding - Diluted 38,516 38,434 38,446 38,438
ITRON, INC. SEGMENT INFORMATION
(Unaudited, in thousands)
Three Months Ended June 30, Six Months Ended June 30,
2016 2015 2016
2015 Revenues Electricity $ 232,823 $ 204,349 $
450,118 $ 396,189 Gas 150,266 139,292 289,522 264,373 Water
129,935 127,170 270,974
256,995 Total Company $ 513,024
$ 470,811 $ 1,010,614
$ 917,557
Gross profit Electricity $
70,892 $ 52,741 $ 135,478 $ 106,945 Gas 53,483 44,027 102,060
88,064 Water 45,330 21,786
95,370 61,967
Total Company $ 169,705 $ 118,554 $
332,908 $ 256,976
Operating
income (loss) Electricity $ 20,008 $ 4,025 $ 30,640 $ 5,139 Gas
25,376 14,659 41,675 29,150 Water 14,177 (11,565 ) 32,253 (2,850 )
Corporate unallocated (24,088 ) (11,087
) (45,521 ) (21,911 ) Total Company $
35,473 $ (3,968 ) $ 59,047
$ 9,528
METER AND MODULE SUMMARY
(Units in thousands)
Three Months Ended June 30,
Six Months Ended June 30, 2016
2015 2016 2015 Meters
Standard 4,130 4,700 8,500 9,440 Advanced and Smart 2,320
1,860 4,510
3,400 Total meters 6,450
6,560 13,010
12,840
Stand-alone communication
modules Advanced and Smart 1,440
1,410 2,900 2,720
ITRON, INC. CONSOLIDATED BALANCE
SHEETS (Unaudited, in thousands)
June 30, 2016 December 31, 2015
ASSETS Current assets Cash and cash equivalents $ 132,014 $
131,018 Accounts receivable, net 369,251 330,895 Inventories
188,181 190,465 Other current assets 115,302
106,562 Total current assets 804,748 758,940
Property, plant, and equipment, net 187,699 190,256 Deferred
tax assets noncurrent, net 102,411 109,387 Other long-term assets
48,324 51,679 Intangible assets, net 87,105 101,932 Goodwill
471,746 468,122 Total assets $
1,702,033 $ 1,680,316
LIABILITIES AND EQUITY Current liabilities Accounts payable
$ 192,169 $ 185,827 Other current liabilities 66,401 78,630 Wages
and benefits payable 91,801 76,980 Taxes payable 16,184 14,859
Current portion of debt 11,250 11,250 Current portion of warranty
26,825 36,927 Unearned revenue 89,508
73,301 Total current liabilities 494,138 477,774
Long-term debt 333,535 358,915 Long-term warranty 18,632
17,585 Pension benefit obligation 87,669 85,971 Deferred tax
liabilities noncurrent, net 1,650 1,723 Other long-term obligations
108,435 115,645 Total
liabilities 1,044,059 1,057,613 Equity Common stock
1,255,313 1,246,671 Accumulated other comprehensive loss, net
(203,222 ) (200,607 ) Accumulated deficit (411,300 )
(441,306 ) Total Itron, Inc. shareholders' equity
640,791 604,758 Non-controlling interests 17,183
17,945 Total equity 657,974
622,703 Total liabilities and
equity $ 1,702,033 $ 1,680,316
ITRON, INC. CONSOLIDATED STATEMENTS OF CASH
FLOWS (Unaudited, in thousands)
Six Months Ended June 30, 2016
2015 Operating activities Net income (loss) $ 31,286 $
(7,761 ) Adjustments to reconcile net income (loss) to net cash
provided by operating activities: Depreciation and amortization
35,481 38,792 Stock-based compensation 7,878 7,997 Amortization of
prepaid debt fees 534 1,579 Deferred taxes, net 9,706 1,885
Restructuring, non-cash (131 ) (110 ) Other adjustments, net (366 )
919 Changes in operating assets and liabilities: Accounts
receivable (35,283 ) (8,641 ) Inventories 2,882 (49,928 ) Other
current assets (10,549 ) (6,254 ) Other long-term assets 2,667
(3,185 ) Accounts payable, other current liabilities, and taxes
payable (735 ) 23,965 Wages and benefits payable 14,709 (5,846 )
Unearned revenue 5,513 10,649 Warranty (9,065 ) 23,046 Other
operating, net (3,400 ) (9,540 ) Net
cash provided by operating activities 51,127 17,567
Investing activities Acquisitions of property, plant, and equipment
(19,884 ) (20,992 ) Business acquisitions, net of cash and cash
equivalents acquired (951 ) - Other investing, net (974 )
693 Net cash used in investing
activities (21,809 ) (20,299 ) Financing activities Proceeds
from borrowings - 74,183 Payments on debt (26,218 ) (22,373 )
Issuance of common stock 1,956 1,864 Repurchase of common stock -
(23,185 ) Other financing, net (4,679 )
(3,942 ) Net cash provided by (used in) financing activities
(28,941 ) 26,547 Effect of foreign exchange rate changes on
cash and cash equivalents 619
(7,372 ) Increase in cash and cash equivalents 996 16,443 Cash and
cash equivalents at beginning of period 131,018
112,371 Cash and cash equivalents at
end of period $ 132,014 $ 128,814
Itron, Inc.
About Non-GAAP Financial Measures
The accompanying press release contains non-GAAP financial
measures. To supplement our consolidated financial statements,
which are prepared and presented in accordance with GAAP, we use
certain non-GAAP financial measures, including non-GAAP operating
expense, non-GAAP operating income, non-GAAP net income, non-GAAP
diluted EPS, adjusted EBITDA, constant currency and free cash flow.
The presentation of this financial information is not intended to
be considered in isolation or as a substitute for, or superior to,
the financial information prepared and presented in accordance with
GAAP. For more information on these non-GAAP financial measures
please see the table captioned “Reconciliations of Non-GAAP
Financial Measures to Most Directly Comparable GAAP Financial
Measures.”
We use these non-GAAP financial measures for financial and
operational decision making and as a means for determining
executive compensation. Management believes that these non-GAAP
financial measures provide meaningful supplemental information
regarding our performance and ability to service debt by excluding
certain expenses that may not be indicative of our recurring core
operating results. These non-GAAP financial measures facilitate
management’s internal comparisons to our historical performance as
well as comparisons to our competitors’ operating results. In
addition, management analyzes revenue growth and operational
results on a constant currency basis to assess how our business
performed excluding the effect of foreign currency rate
fluctuations. Our executive compensation plans exclude non-cash
charges related to amortization of intangibles and certain discrete
cash and non-cash charges such as purchase accounting adjustments,
restructuring charges or goodwill impairment charges. We believe
that both management and investors benefit from referring to these
non-GAAP financial measures in assessing our performance and when
planning, forecasting and analyzing future periods. We believe
these non-GAAP financial measures are useful to investors because
they provide greater transparency with respect to key metrics used
by management in its financial and operational decision making and
because they are used by our institutional investors and the
analyst community to analyze the health of our business.
Non-GAAP operating expense and non-GAAP operating income – We
define non-GAAP operating expense as operating expense excluding
certain expenses related to the amortization of intangible assets
acquired through a business acquisition, restructuring,
acquisitions and goodwill impairment. We define non-GAAP operating
income as operating income excluding the expenses related to the
amortization of intangible assets, restructuring, acquisitions and
goodwill impairment. We consider these non-GAAP financial measures
to be useful metrics for management and investors because they
exclude the effect of expenses that are related to previous
acquisitions and restructurings. By excluding these expenses, we
believe that it is easier for management and investors to compare
our financial results over multiple periods and analyze trends in
our operations. For example, in certain periods expenses related to
amortization of intangible assets may decrease, which would improve
GAAP operating margins, yet the improvement in GAAP operating
margins due to this lower expense is not necessarily reflective of
an improvement in our core business. There are some limitations
related to the use of non-GAAP operating expense and non-GAAP
operating income versus operating expense and operating income
calculated in accordance with GAAP. Non-GAAP operating expense and
non-GAAP operating income exclude some costs that are recurring.
Additionally, the expenses that we exclude in our calculation of
non-GAAP operating expense and non-GAAP operating income may differ
from the expenses that our peer companies exclude when they report
the results of their operations. We compensate for these
limitations by providing specific information about the GAAP
amounts we have excluded from our non-GAAP operating expense and
non-GAAP operating income and evaluating non-GAAP operating expense
and non-GAAP operating income together with GAAP operating expense
and GAAP operating income.
Non-GAAP net income and non-GAAP diluted EPS – We define
non-GAAP net income as income excluding the expenses associated
with amortization of intangible assets, restructuring,
acquisitions, goodwill impairment, amortization of debt placement
fees and the tax effect of excluding these expenses. We define
non-GAAP diluted EPS as non-GAAP net income divided by the weighted
average shares, on a diluted basis, outstanding during each period.
We consider these financial measures to be useful metrics for
management and investors for the same reasons that we use non-GAAP
operating income. The same limitations described above regarding
our use of non-GAAP operating income apply to our use of non-GAAP
net income and non-GAAP diluted EPS. We compensate for these
limitations by providing specific information regarding the GAAP
amounts excluded from these non-GAAP measures and evaluating
non-GAAP net income and non-GAAP diluted EPS together with GAAP net
income and GAAP diluted EPS.
Adjusted EBITDA – We define adjusted EBITDA as net income (a)
minus interest income, (b) plus interest expense, depreciation and
amortization of intangible asset expenses, restructuring expense,
acquisition related expense, goodwill impairment and (c) exclude
the total tax expense or benefit. We believe that providing this
financial measure is important for management and investors to
understand our ability to service our debt as it is a measure of
the cash generated by our core business. Management uses adjusted
EBITDA as a performance measure for executive compensation. A
limitation to using adjusted EBITDA is that it does not represent
the total increase or decrease in the cash balance for the period
and the measure includes some non-cash items and excludes other
non-cash items. Additionally, the items that we exclude in our
calculation of adjusted EBITDA may differ from the items that our
peer companies exclude when they report their results. We
compensate for these limitations by providing a reconciliation of
this measure to GAAP net income.
Free cash flow – We define free cash flow as net cash provided
by operating activities less cash used for acquisitions of
property, plant and equipment. We believe free cash flow provides
investors with a relevant measure of liquidity and a useful basis
for assessing our ability to fund our operations and repay our
debt. The same limitations described above regarding our use of
adjusted EBITDA apply to our use of free cash flow. We compensate
for these limitations by providing specific information regarding
the GAAP amounts and reconciling to free cash flow.
Constant currency - We may refer to the impact of foreign
currency exchange rate fluctuations in our discussions of financial
results, which references the differences between the foreign
currency exchange rates used to translate operating results from
local currencies into U.S. dollars for financial reporting
purposes. We also use the term “constant currency,” which
represents financial results adjusted to exclude changes in foreign
currency exchange rates as compared with the rates in the
comparable prior year period. We calculate the constant currency
change as the difference between the current period results and the
comparable prior period’s results restated using current period
currency exchange rates.
The accompanying tables have more detail on the GAAP financial
measures that are most directly comparable to the non-GAAP
financial measures and the related reconciliations between these
financial measures.
ITRON, INC. RECONCILIATIONS OF NON-GAAP FINANCIAL
MEASURES TO THE MOST DIRECTLY COMPARABLE GAAP FINANCIAL
MEASURES (Unaudited, in thousands, except per share
data)
TOTAL COMPANY RECONCILIATIONS Three Months
Ended June 30, Six Months Ended June 30, 2016
2015 2016 2015
NON-GAAP NET INCOME & DILUTED EPS GAAP net income (loss)
attributable to Itron, Inc. $ 19,917 $ (14,346 ) $ 30,006 $ (8,948
) Amortization of intangible assets 7,796 7,888 14,006 15,861
Amortization of debt placement fees 248 1,164 495 1,529
Restructuring (1,622 ) (4,234 ) 615 (9,415 ) Acquisition-related
expenses (25 ) (4,607 ) (22 ) (2,283 ) Income tax effect of
non-GAAP adjustments (1,170 ) (773 )
(3,125 ) (3,103 ) Non-GAAP net income
(loss) attributable to Itron, Inc. $ 25,144 $
(14,908 ) $ 41,975 $ (6,359 )
Non-GAAP diluted EPS $
0.65 $ (0.39 ) $ 1.09 $
(0.17 ) Weighted average common shares outstanding - Diluted
38,516 38,434
38,446 38,438
ADJUSTED
EBITDA GAAP net income (loss) attributable to Itron, Inc. $
19,917 $ (14,346 ) $ 30,006 $ (8,948 ) Interest income (221 ) (212
) (492 ) (260 ) Interest expense 2,735 3,855 5,653 6,537 Income tax
provision 12,193 4,098 20,819 9,128 Depreciation and amortization
18,807 19,437 35,481 38,792 Restructuring (1,622 ) (4,234 ) 615
(9,415 ) Acquisition-related expenses (25 )
(4,607 ) (22 ) (2,283 ) Adjusted
EBITDA $ 51,784 $ 3,991 $ 92,060
$ 33,551
FREE CASH FLOW Net cash
provided by operating activities $ 17,322 $ 21,522 $ 51,127 $
17,567 Acquisitions of property, plant, and equipment
(11,093 ) (11,520 ) (19,884 )
(20,992 ) Free Cash Flow $ 6,229
$ 10,002 $ 31,243 $ (3,425 )
NON-GAAP OPERATING INCOME GAAP operating income (loss) $
35,473 $ (3,968 ) $ 59,047 $ 9,528 Amortization of intangible
assets 7,796 7,888 14,006 15,861 Restructuring (1,622 ) (4,234 )
615 (9,415 ) Acquisition-related expenses (25 )
(4,607 ) (22 ) (2,283 )
Non-GAAP operating income (loss) $ 41,622 $
(4,921 ) $ 73,646 $ 13,691
NON-GAAP OPERATING EXPENSES GAAP operating expenses $
134,232 $ 122,522 $ 273,861 $ 247,448 Amortization of intangible
assets (7,796 ) (7,888 ) (14,006 ) (15,861 ) Restructuring 1,622
4,234 (615 ) 9,415 Acquisition-related expenses 25
4,607 22
2,283 Non-GAAP operating expenses $ 128,083
$ 123,475 $ 259,262 $
243,285
ITRON, INC. RECONCILIATIONS
OF NON-GAAP FINANCIAL MEASURES TO THE MOST DIRECTLY
COMPARABLE GAAP FINANCIAL MEASURES
(Unaudited, in thousands, except per
share data)
SEGMENT RECONCILIATIONS
Three Months Ended June 30, Six Months Ended June 30,
2016 2015 2016
2015 NON-GAAP OPERATING INCOME - ELECTRICITY
Electricity - GAAP operating income $ 20,008 $ 4,025 $ 30,640 $
5,139 Amortization of intangible assets 4,617 4,428 7,867 8,883
Restructuring (1,560 ) (2,703 ) (1,032 ) (5,465 )
Acquisition-related expenses (25 )
(4,607 ) (22 ) (2,283 ) Electricity -
Non-GAAP operating income $ 23,040 $ 1,143
$ 37,453 $ 6,274
NON-GAAP OPERATING INCOME - GAS Gas - GAAP operating income
$ 25,376 $ 14,659 $ 41,675 $ 29,150 Amortization of intangible
assets 1,756 1,945 3,375 3,915 Restructuring (12 )
(1,186 ) 1,252
(1,061 ) Gas - Non-GAAP operating income $ 27,120
$ 15,418 $ 46,302 $ 32,004
NON-GAAP OPERATING INCOME - WATER Water - GAAP
operating income (loss) $ 14,177 $ (11,565 ) $ 32,253 $ (2,850 )
Amortization of intangible assets 1,423 1,515 2,764 3,063
Restructuring 115 156
51 273 Water - Non-GAAP
operating income (loss) $ 15,715 $ (9,894 ) $
35,068 $ 486
NON-GAAP
OPERATING INCOME - CORPORATE UNALLOCATED Corporate unallocated
- GAAP operating loss $ (24,088 ) $ (11,087 ) $ (45,521 ) $ (21,911
) Restructuring (165 ) (501 )
344 (3,162 ) Corporate unallocated -
Non-GAAP operating loss $ (24,253 ) $ (11,588 ) $
(45,177 ) $ (25,073 )
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version on businesswire.com: http://www.businesswire.com/news/home/20160901005324/en/
Itron, Inc.Barbara Doyle, 509-891-3443Vice President,
Investor RelationsorMarni Pilcher, 509-891-3847Director, Investor
Relations
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