FLIR’s third-quarter results were “somewhat mixed,” according to CEO Jim Cannon, who added that he was not satisfied with the company’s quarterly revenue.
Revenue in the third quarter was $471.2 million, 8.4 percent higher than the third quarter of 2018 revenue of $434.9 million. Organic revenue growth was 2.5 percent, which excludes revenue from acquisitions within the last 12 months. Third quarter total bookings increased 13 percent from the third quarter of 2018 to $495.3 million.
Cannon said performance in the government and defense and industrial business units were strong. However, several product lines within the commercial business unit, which includes maritime, “continue to face headwinds, and some key end-markets served by the commercial business unit were negatively impacted by geopolitical and macroeconomic factors,” Cannon said in a statement. “While consolidated earnings were in line with our expectations and cash flow from operations was very strong, I am not satisfied with FLIR’s third quarter revenue performance.”
Commercial business unit revenues totaled $81.3 million, down 5.3 percent from the prior year. Revenues were adversely affected by foreign exchange effects, as well as lower customer demand in the maritime business primarily related to macroeconomic conditions.
Third quarter operating income of $7.6 million and operating margin of 9.3 percent decreased 27.5 percent and 286 basis points year-over-year, respectively. The decrease was primarily driven by revenue declines in the Maritime and Outdoor and Tactical Systems businesses due to weaker end-markets impacted by geopolitical and macroeconomic factors, as well as the impact from foreign currency exchange and U.S. import tariffs, according to the company.