Operating income for the quarter was $10.0 million, up 53 percent from $6.5 million in the previous quarter.
We managed our business very effectively throughout 2001, successfully adjusting our expenses to reflect our revenue, said Alex Davern, CFO of NI. This enabled us to deliver solid profitability and record annual cash flow from operations of $57 million.
Q4 2001 Highlights
Solid profitability with diluted EPS of 14 cents
Delivered 11 percent operating margins
Strong growth in PXI hardware and LabVIEW Real-Time software
TestStand software named one of year’s best test products by Test & Measurement World
Continued investment in strategic R&D and sales initiatives
During Q4, NI’s revenue from instrument control products showed signs of stabilization while revenue from the company’s computer-based measurement and automation products increased 14 percent from Q3 2001 and now represents 82 percent of revenue. Geographically, the breakdown of revenue in U.S. dollar terms for Q4 2001 as compared to Q4 2000 was as follows: Americas, down 23 percent; Europe, down 14 percent; Asia, down 8 percent; and down 17 percent worldwide. In local currency terms, revenue was down 9 percent in Europe, down 6 percent in Asia, and down 16 percent worldwide.
While 2001 proved very challenging, we continued to aggressively invest in our key strategic initiatives and started 2002 with the introduction of LabVIEW 6.1, the latest-generation of our flagship software product, said James Truchard, NI President and CEO. In addition, we recently held our worldwide sales conference here in Austin where we previewed many of the exciting new products we are working on for the coming year. Feedback from our sales force affirmed these new product initiatives are right on track.
2001 Highlights
Named to FORTUNE 100 Best Places to Work for third consecutive year
Increased R&D investment by 9 percent and added 217 new engineers to sales, marketing, and R&D
Released major product innovations such as FieldPoint 2000, LabVIEW Real-Time 6i, TestStand 2.0, and Measurement Studio 6.0
Strengthened business model with award-winning ni.com
Held operating expenses flat with 2000 and delivered 13 percent operating margin
Delivered record cash flow from operations of $57 million
For the year, net income was $36.4 million as compared to $55.2 million for 2000; diluted EPS for 2001 was $0.68 compared to $1.03 in 2000. For the year, revenue was down 6 percent in U.S. dollar terms, totaling $385 million compared to $410 million in 2000. In local currency terms, revenue was down 2 percent.
While the company still has a relatively difficult compare in the first quarter of 2002, the compares will ease significantly in the second and third quarters. Through Jan. 22, NI’s daily order rate for the first quarter was down 12 percent compared to this time last year. If the order rate remains consistent for the rest of the quarter, revenue in Q1 2002 would be flat sequentially. This would be consistent with our pattern where for the four years prior to 2001, revenue in Q1 was within 1 percent of the previous Q4. The actual order rate for the remainder of Q1 2002 will be impacted by the performance of the overall economy. NI estimates that Q1 expenses will be approximately $61 million, flat with Q1 2001.
