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Oct 25, 2001
FLIR Systems Third Quarter 2001 Net Earnings Increase to $0.38 Per Share; Revenue Increases 19% to $47.5 Million; Company Increases Revenue and Earnings Guidance for 2001
FLIR Systems Third Quarter 2001 Net Earnings Increase to $0.38 Per Share; Revenue Increases 19% to $47.5 Million; Company Increases Revenue and Earnings Guidance for 2001PORTLAND, Ore., Oct 25, 2001 (BUSINESS WIRE) -- FLIR Systems, Inc. (Nasdaq:FLIR) announced today that net earnings for the third quarter ended Sept. 30, 2001 totaled $6.2 million, or $0.38 per diluted share. Revenue for the third quarter was $47.5 million, as compared to $39.9 million for last year's third quarter.

For the nine months ended Sept. 30, 2001, net earnings were $15.7 million, or $1.01 per diluted share. Revenue for the first nine months of 2001 totaled $149.4 million.

For the quarter ended Sept. 30, 2001, gross margin rose to 54.7% and operating margin rose to 18.7%. Cash generated from operations totaled $8.7 million for the 2001 third quarter and $28.4 million for the first nine months of the year. The Company reduced debt by $6.9 million for the third quarter and $27.4 million for the first nine months of 2001.

FLIR also reported a firm order backlog of approximately $74 million at Sept. 30, 2001 as compared to $68 million at June 30, 2001.

"FLIR is continuing to achieve impressive financial performance, including record net earnings, continued significant cash flow and further growth in orders. These gains reflect higher sales of our imaging and thermography products to both commercial and government customers. This impressive performance is a tribute to everyone at the company who has worked so hard to successfully implement our strategy to realign operations, eliminate lower margin products, improve manufacturing efficiencies and reduce production and distribution costs, all while keeping our new product pipeline full and our technology ahead of the curve. The company is running efficiently, and we are optimistic about FLIR's continued strong performance for the fourth quarter," said Earl R. Lewis, President and Chief Executive Officer of FLIR.

Company Increases Revenue and Earnings Guidance for 2001

The following statements are based on current expectations. These statements are forward-looking, and actual results may differ materially.

"Based on FLIR's performance during the first nine months of 2001, we are increasing our guidance for revenue for the year to approximately $215 million, which represents an increase of 15 percent over last year's revenue of $186.4 million. We also are once again increasing our earnings guidance for 2001 to the range of $1.45 to $1.55 per diluted share," Lewis said.

Forward-Looking Statements

The statements in this release by Earl R. Lewis and the statements in the 2001 Outlook above are forward-looking statements within the meaning of the Securities Litigation Reform Act of 1995. Such statements are based on current expectations, estimates and projections about the company's business based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including the following: changes in demand for the company's products, product mix, the timing of customer orders and deliveries, the impact of competitive products and pricing, constraints on supplies of critical components, excess or shortage of production capacity, actual purchases under agreements, the amount and availability of government procurement funds and other risks discussed from time to time in the company's Securities and Exchange Commission filings and reports. In addition, such statements could be affected by general industry and market conditions and growth rates, and general domestic and international economic conditions. Such forward-looking statements speak only as of the date on which they are made and the company does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release.

Conference Call

FLIR has scheduled a conference call at 11:00 am EST today. A simultaneous WebCast of the conference call may be accessed online at or at A replay will be available approximately one hour after the WebCast at these same Internet addresses. For a telephone replay, dial 800/633-8284, reservation No. 19825182 beginning at approximately 1:00 PM EDT.

About FLIR Systems

FLIR Systems, Inc. is a world leader in the design, manufacture and marketing of thermal imaging and stabilized camera systems for a wide variety of thermography and imaging applications including condition monitoring, research and development, manufacturing process control, airborne observation and broadcast, search and rescue, drug interdiction, surveillance and reconnaissance, navigation safety, border and maritime patrol, environmental monitoring and ground-based security. Visit the company's Web site at

                          FLIR SYSTEMS, INC.
               (In thousands, except per share amounts)
                           Three Months Ended      Nine Months Ended
                              September 30,          September 30,
                             2001      2000         2001        2000
Revenue                    $47,499  $ 39,912    $ 149,366   $ 129,150
Cost of goods sold          21,537    29,214       67,418      76,595
      Gross profit          25,962    10,698       81,948      52,555
Operating expenses:
Research and development     6,053     6,816       18,793      23,251
Selling and other
 operating costs            11,005    15,995       37,857      48,811
  Total operating expenses  17,058    22,811       56,650      72,062
Earnings (loss) from
 operations                  8,904   (12,113)      25,298     (19,507)
Interest expense             2,846     3,307        8,304       8,245
Other income -- net           (180)     (242)        (418)       (257)
    Earnings (loss) before
     income taxes            6,238   (15,178)      17,412     (27,495)
Income tax provision            65     2,971        1,741       1,135
Net earnings (loss)        $ 6,173  $(18,149)     $15,671   $ (28,630)
Net earnings (loss) per share:
   Basic                   $  0.41  $  (1.25)      $ 1.06     $ (1.98)
   Diluted                 $  0.38  $  (1.25)      $ 1.01     $ (1.98)
                          FLIR SYSTEMS, INC.
                      CONSOLIDATED BALANCE SHEET
                 (In thousands, except share amounts)
                                September 30,     December 31,
                                    2001             2000
Current assets:
   Cash and cash equivalents     $ 13,083          $ 11,858
   Accounts receivable, net        41,166            39,663
   Inventories                     45,929            55,495
   Prepaid expenses and other
    current assets                  5,972             4,943
   Deferred income taxes           11,943            11,943
   Total current assets           118,093           123,902
Property and equipment, net        13,467            13,843
Deferred income taxes, net         11,772            11,772
Intangible assets, net             17,178            16,635
Other assets                        1,486               839
                                $ 161,996         $ 166,991
Current liabilities:
    Notes payable                $ 65,834         $  17,716
    Accounts payable               10,993            16,247
    Accrued payroll and other
     liabilities                   25,055            19,186
    Accrued income taxes            1,156             2,217
    Current portion of capital
     lease obligations                766             1,103
       Total current liabilities  103,804            56,469
Long-term debt                         --            75,485
Pension and other long-term
 liabilities                        8,948             6,012
Commitments and contingencies
Shareholders' equity:
Preferred stock, $0.01 par value,
    10,000,000 shares authorized;
    no shares issued at Sept. 30,
    2001, and Dec. 31, 2000            --                --
Common stock, $0.01 par value,
    30,000,000 shares authorized,
    15,252,259 and 14,548,370
    shares issued at Sept. 30,
    2001, and Dec. 31, 2000,
    respectively                      152               145
Additional paid-in capital        149,579           144,118
Accumulated deficit               (95,127)         (110,798)
Accumulated other comprehensive
 loss                              (5,360)           (4,440)
     Total shareholders' equity    49,244            29,025
                                $ 161,996         $ 166,991

CONTACT:          FLIR Systems, Inc.  
                  Jim Fitzhenry, 503/684-3731             
                  Neil Berkman Associates, 310/277-5162 (Investor Contact)

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