On July 28th, Teledyne Technologies published its financial results for Q2 2021. These show that the company achieved record results during the second quarter. Robert Mehrabian, Executive Chairman, commented: “The second quarter was truly a record for Teledyne with sales, operating margin and earnings, excluding acquisition-related costs, significantly greater than any prior period”. Net sales were $1,121 million, compared with $743.3 million in Q2 2020, an increase of approximately +51%. These results reflect the aggregated performance of the companies four reportable segments:
- Digital Imaging
- Aerospace and Defense Electronics
- Engineered Systems
The Digital Imaging Segment
The digital imaging segment encompasses a portfolio of digital imaging products for use in industrial, government and medical applications. This includes sensors, cameras and systems, within the visible, infrared and X-ray spectra, such as its series of CMOS based X-ray detectors. The segment also includes its semiconductor business, analogue-to-digital converters as well as micro-electro-mechanical systems (“MEMS”). The digital imaging segment has principal operations in the United States, Canada, France, the Netherlands and the United Kingdom.
The Digital Imaging segment’s second-quarter 2021 net sales were $579.5 million, compared with $237.6 million in Q2 2020, an increase of 143.9%. Operating income was $84.6 million for the second quarter of 2021, compared with $46.8 million, an increase of 80.8%. The quarterly sales increase included $301.4 million of incremental net sales from the FLIR acquisition as well as +17% organic sales growth, predominately from industrial and scientific sensors and cameras, micro-electromechanical systems (“MEMS”) and geospatial imaging software.
The second quarter of 2021 net sales reflected the historical concentration of FLIR net sales in the second half of the quarter. The increase in operating income in the second quarter of 2021 reflected the historical concentration of FLIR net sales which were disproportionately higher than the operating expenses, partially offset by $70.2 million of FLIR acquisition-related transaction and purchase accounting expenses, which included $24.0 million of integration-related costs, $22.8 million in acquired intangible asset amortization expense and $23.4 million in inventory step-up expense. The increase in operating income also reflected the impact of organic sales growth.