THOUSAND OAKS, Calif. - July 27, 2022 - Teledyne Technologies Incorporated (NYSE:TDY)
- Record second quarter sales of $1,355.8 million, an increase of 20.9% compared with last year
- Organic sales growth was 8.2% including the negative impact of foreign currency translation
- Record second quarter GAAP diluted earnings per share of $3.59
- Non-GAAP diluted earnings per share of $4.43
- Revising full year 2022 GAAP earnings outlook to $15.13 to $15.45 diluted earnings per share, compared with the prior outlook of $15.34 to $15.66, and full year non-GAAP earnings outlook to $17.45 to $17.70, compared with the prior outlook of $17.75 to $18.00
- Quarter-end Consolidated Leverage Ratio declined to 2.5x
- Capital deployment included repurchases of fixed-rate debt and the recent acquisition of a majority interest in NL Acoustics
Teledyne today reported second quarter 2022 net sales of $1,355.8 million, compared with net sales of $1,121.0 million for the second quarter of 2021, an increase of 20.9%. Net income was $171.3 million ($3.59 diluted earnings per share) for the second quarter of 2022, compared with $64.7 million ($1.48 diluted earnings per share) for the second quarter of 2021, an increase of 164.8%. The second quarter of 2022 net sales included $167.6 million in incremental net sales from the acquisition of FLIR Systems, Inc. ("FLIR"), which was acquired midway through the second quarter of 2021. The second quarter of 2022 also reflected net discrete income tax benefits of $1.0 million compared with net discrete income tax expense of $4.1 million for the second quarter of 2021. The second quarter of 2022 included $51.3 million of pretax acquired intangible asset amortization expense and $0.6 million of acquisition related tax expense. Excluding these charges, non-GAAP net income for the second quarter of 2022 was $211.3 million ($4.43 diluted earnings per share). In the second quarter of 2021, Teledyne incurred pretax expenses of $150.7 million, which included $42.3 million of transaction and integration related costs, $52.2 million for the settlement of FLIR employee and director stock awards, $32.8 million in acquired intangible asset amortization expense and $23.4 million in acquired inventory step-up expense. Excluding these charges, non-GAAP net income for the second quarter of 2021 was $201.0 million ($4.61 diluted earnings per share). Operating margin was 16.9% for the second quarter of 2022, compared with 9.3% for the second quarter of 2021. Excluding acquisition-related transaction and purchase accounting expenses, non-GAAP operating margin for the second quarter of 2022 was 20.7%, compared with 22.8% for the second quarter of 2021.
"The demand environment for Teledyne remained strong in the second quarter. In fact, we achieved record quarterly orders and ended the quarter with over $3.0 billion of backlog. Consolidated book to bill was 1.08x with particular strength at Teledyne FLIR, where orders were 25% greater than sales," said Robert Mehrabian, Chairman, President and Chief Executive Officer. "Despite increased foreign currency headwind, organic sales growth accelerated and was 8.2% in the second quarter. Free cash flow improved from the first quarter, but inventory levels remained elevated to counter supply chain risk. Given the recent and significant appreciation of the U.S. dollar, ongoing supply chain constraints and inflation, we believe it is prudent to revise our reported revenue and adjusted earnings outlook modestly for the remainder of the year. Nevertheless, we continue to see mid-single digit organic sales growth in the second half and full year 2022 including the impact of foreign currency translation. We remain highly confident in our balanced and resilient mix of commercial and government businesses across a broad range of geographies and end markets. Finally, having reached our targeted leverage range, we are again pursuing acquisitions and are pleased to have recently completed our first bolt-on acquisition at Teledyne FLIR."
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