Thermal imaging giant FLIR Systems has reported a sharp increase in earnings for its latest financial quarter, sending the US company’s stock price to an all-time high during its 25 years on the Nasdaq index.
At $453 million, revenues in the second quarter of 2018 were up 4 per cent on the same period last year – with organic growth significantly higher at 11 per cent when the recent sale of FLIR’s security business is taken into account.
But there was greater traction on the bottom line as FLIR’s net earnings jumped almost one-third, to $71.6 million. Those figures and a slight upward shift in the company’s sales guidance for the full year cheered the markets, sending FLIR’s stock price up nearly 10 per cent and to its highest valuation since the company floated on the Nasdaq back in 1993.
Automotive dataset
CEO Jim Cannon highlighted a wealth of new products released over the past few months, including the availability of a “machine learning thermal dataset” aimed at advanced driver assistance systems and self-driving vehicles in development.
“Featuring a compilation of more than 10,000 thermal images, it's the first of its kind to include annotations for cars, other vehicles, people, bicycles and even dogs,” he told an analyst call. “The machine learning thermal dataset enables automotive researchers and developers to accelerate testing of thermal sensors on self-driving systems.”
Cannon added: “Recent high-profile autonomous driving-related accidents show a clear need for affordable, intelligent thermal sensors to enable safer autonomous vehicles.”
Of FLIR’s three business units the industrial division provided the sharpest growth in the latest quarter, with sales up 14 per cent year-on-year to $188 million thanks to particular strength in optical gas imaging, unmanned aerial systems, and automotive applications.
Cannon, who says that the current momentum will continue through the second half of the year, remains focused on refining the company’s product portfolios in some areas, and streamlining operations to ensure that product backlogs and lead times are kept under control.
Machine vision targets
The CEO also highlighted how machine vision has become a key part of FLIR’s industrial business unit since its acquisition of camera firm Point Grey Research back in 2016.
The former Point Grey business registered what Cannon described as “tremendous” growth in 2017 – largely thanks to a welter of new smart phone launches that had prompted investment in production lines fitted with machine vision.
This year has proved something of an “off” year in terms of smart phones thus far, but the FLIR unit is still registering growth – partly because of that control over backlogs. Cannon said: “So while we've seen some other competitors in that space have flattish growth because the comp[arison versus 2017] again is so strong, our business is continuing to grow and benefiting from the lead time reductions that we've had.”
He also indicated that FLIR would look to further build its presence in the machine vision sector, telling the analyst call:
“We are acquisitive in that area, and we're looking for opportunities. It's a very fragmented market space in some cases with a lot of regional players involved as well. But you can expect to see us continue to be very active, looking for more Point Grey-like targets to consolidate the market space.”
