HAWTHORNE, CA – OSI Systems reported fiscal third quarter revenues of $292.9 million, down 3.7% year-over-year.

Net income for the quarter ended Mar. 31 was $19.6 million, flat with the same period last year.

During the quarter, the company’s book-to-bill ratio was 0.9x. As of Mar. 31, the company's backlog was $863 million, compared to $911 million as of June 30, 2019. Operating cash flow during the quarter was $45.9 million, and capital expenditures were $4.5 million.

“Our Optoelectronics and Manufacturing division continued its strong performance, with year-over-year operating margin expansion,” said Deepak Chopra, chairman and CEO. “We faced operational challenges associated with Covid-19 in the latter part of the third fiscal quarter and expect these challenges to continue as the world battles coronavirus.

“During this unprecedented time, we want to thank all the healthcare professionals, first responders, and others who are on the front lines fighting the Covid-19 pandemic. As responsible global citizens, we are assisting this effort by carrying out our mission to create solutions for a safer and healthier world. Thank you to our employees and our business network for their incredible efforts to maintain supply of our critically important products around the globe. It is a unique time, and we are rising to meet the challenge, while simultaneously focusing on the safety of our employees.

“We are pleased with our third quarter performance, as we delivered record earnings per share and continue to have a strong balance sheet with a robust pipeline of opportunities. Although there has recently been increased demand for our healthcare products as a result of the pandemic, we expect certain delays in product deliveries and new orders in our other divisions, as some of our customers are being negatively impacted by Covid-19.

“Our Security division reported a 3% sales decline, with third quarter revenues of $187 million. Toward the end of the quarter, we began to feel the impact of the pandemic, most notably with our aviation and cargo customers. We are well positioned in the marketplace as we target significant opportunities globally, although we do expect some continued headwinds.”

For the nine months ended Mar. 31, revenues increased 2% to $889.1 million compared to the same period a year ago. Net income was $61.3 million, up 27.4% year-over-year.

OSI is revising its fiscal 2020 sales guidance to a range of $1.165 billion to $1.185 billion. Management’s current estimate of the impact of the Covid-19 pandemic is included in the guidance. However, given uncertainties as to the duration and scope of the pandemic and other variables, the extent to which Covid-19 may impact financial results is difficult to predict and could vary materially from these estimates.

“We have a strong balance sheet with net leverage of approximately 1.4 and a $535 million credit facility that provides liquidity to meet our operational needs for the foreseeable future,” said Alan Edrick, executive VP and CFO. “In this current environment, we are focused on maintaining our financial flexibility to support long-term growth and be in a nimble position to take advantage of strategic opportunities.”