Itron Inc. (ITRI) reported fourth-quarter earnings of 82 cents per share, above the Zacks Consensus Estimate of 60 cents and 15.5% higher than the prior-year EPS of 71 cents. The earnings growth was primarily driven by higher revenues.
Quarterly revenue of $476.8 million was up 10.3% from $432.4 million in the fourth quarter of 2008. Itron North America revenue increased 16% compared to prior-year quarter as a result of higher shipments of OpenWay meters and modules, partially offset by fewer shipments of non-AMI electric meters and AMR modules. International revenues were up 6% from the year-ago level due to a favorable impact of foreign currency translation, which was partially offset by weak demand conditions in certain markets.
Gross margin in the quarter was 30.5%, compared to 33.6% in the fourth quarter of 2008 due to lower margins in both the North American and International operations. The gross margin in North American operations was lower than last year due to unfavorable product mix, i.e. higher shipments of OpenWay meters and fewer AMR meter and module shipments. International gross margin declined due to expenses related to discontinuation of product lines and streamlining of the company’s service operations in Brazil.
The company had a total backlog of $1.5 billion as of December 31, 2009. This includes a twelve month backlog of $807 million, which was higher than the previous year’s level of $418 million, due to the inclusion of substantial amount of AMI shipments in the current twelve month backlog.
Itron generated $141 million in operating cash flow and $88 million of free cash flow in 2009. The company ended the year with cash and cash equivalents of $122 million and long-term debt of $771 million on its balance sheet.
For 2010, Itron anticipates a low single-digit growth in international revenues, excluding currency translation impact. Also, the company forecast a 25%-35% growth in revenues in its North American operations. The growth is expected to come from the rollout of booked AMI projects as well as additional expected new contracts resulting from the stimulus funding.
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