Osi Systems Inc (OSIS) SEC Filing 10-K Annual report for the fiscal year ending Sunday, June 30, 2013

Exhibit 99.1

OSI Systems Reports Fourth Quarter and Fiscal Year 2013 Financial Results

• Record Q4 Earnings per Share
  • Non-GAAP EPS of $1.02 (29% increase over prior year)
  • GAAP EPS of $0.58
• FY 2014 Revenue Guidance of $870 million - $895 million (8% - 12% growth)
• FY 2014 Non-GAAP Earnings Guidance of $3.22 - $3.38 per Share (17% - 22% growth)

HAWTHORNE, Calif.--(BUSINESS WIRE)--August 14, 2013--OSI Systems, Inc. (NASDAQ: OSIS) today announced financial results for its fourth quarter and fiscal year ended June 30, 2013.

Deepak Chopra, OSI Systems President and CEO, stated, “We are pleased to announce the results of our fourth quarter, as we finished the year strong, positioning us well for future growth. We achieved record non-GAAP earnings for the 16th consecutive quarter as a result of significant operating margin expansion. As expected, sales decreased 3% as our fourth quarter sales from the prior year were unusually high due to a large U.S. Army program that was substantially completed during that quarter, making our prior fourth quarter results a difficult point of comparison. Excluding the impact of this program, sales increased by 20%.”

Mr. Chopra continued, “The momentum gained from a strong finish by each division, combined with a year-end backlog of approximately $1 billion and a significant pipeline of opportunities, positions us well for solid growth in fiscal 2014.”

The Company reported revenues of $228 million for the fourth quarter of fiscal 2013, a decrease of 3% from the $235 million reported for the fourth quarter of fiscal 2012. Net income for the fourth quarter of fiscal 2013 was $11.8 million, or $0.58 per diluted share, compared to net income of $15.9 million, or $0.78 per diluted share for the fourth quarter of fiscal 2012. Excluding the impact of impairment, restructuring and other charges, and the impact of tax elections discussed below, net income for the fourth quarter of fiscal 2013 would have been approximately $20.9 million, or $1.02 per diluted share, compared to net income of $16.3 million, or $0.79 per diluted share for the fourth quarter of fiscal 2012.

For the fiscal year ended June 30, 2013, the Company reported revenues of $802 million, a 1% increase from the $793 million reported for fiscal 2012. Net income for fiscal 2013 was $44.1 million, or $2.15 per diluted share, compared to net income of $45.5 million, or $2.24 per diluted share in fiscal 2012. Excluding the impact of impairment, restructuring and other charges, and the impact of tax elections discussed below, net income for fiscal 2013 would have been approximately $56.8 million, or $2.76 per diluted share, compared to net income of $46.6 million, or $2.29 per diluted share for the comparable period of fiscal 2012.

During the fourth quarter, the Company made certain tax elections related to the turnkey program in Mexico to accelerate depreciation and realize cash tax savings of approximately $26 million. In doing so, the Company forfeited tax basis in certain fixed assets that resulted in a charge to income tax of $6.8 million, resulting in an effective tax rate of 52.7% and 36.4% for the three months and fiscal year ended June 30, 2013, respectively. Had this election not been made, the effective tax rate would have been 25.4% and 26.6% for the three months and fiscal year ended June 30, 2013, respectively.

As of June 30, 2013, the Company’s backlog was approximately $1.0 billion, which was comparable to the amount as of March 31, 2013. During fiscal 2013, the Company generated cash flow from operations of $58.7 million and capital expenditures were $157.4 million primarily as a result of the significant investment in the turnkey program in Mexico.

Mr. Chopra continued, “During the fourth quarter, our Security Division achieved record operating profits as the higher margin turnkey screening solution business was a key factor in increasing our operating margins from 7% in fiscal 2012 to 16% in fiscal 2013. As expected, sales declined as we recognized $47 million in revenues in the prior year quarter related to a $98 million contract where we served as a prime contractor and hardware systems integrator. The success of our turnkey screening solution programs, the pipeline of opportunities and our expanded product portfolio continue to provide an outstanding outlook for our Security Division.”

Mr. Chopra further commented, “Our Healthcare Division finished a challenging year with a strong quarter. Although our fourth quarter revenues were slightly lower than the prior year, we rebounded sharply with 41% sequential sales growth leading to both record operating income and operating margin, excluding the impact of restructuring and other charges.”