Motorola Solutions Reports Third-Quarter Financial Results
Friday, November 03, 2017 | Comments

Motorola Solutions reported its earnings results for the third quarter. Sales increased 7 percent overall from the year-ago quarter and increased 5 percent organically driven by the Americas region.

Products segment sales increased 8 percent driven by the Americas and Europe, Middle East and Africa (EMEA) regions. The services segment increased 7 percent driven by the Americas, with global managed and support services growth of 8 percent.

GAAP operating margin was 20.5 percent of sales compared with 22.3 percent in the year-ago quarter. The decline reflects higher costs related to non-U.S. pension settlement losses and intangible amortization expenses.

The company generated $270 million in operating cash, a decrease of $78 million from the year-ago quarter. Free cash flow was $185 million, down $95 million. Cash flow for the quarter was down because of higher working capital and higher capital expenses associated with the implementation of a new enterprise resource planning (ERP) system and higher tax payments.

The company repurchased about $100 million of its common stock and paid approximately $76 million in cash dividends. Additionally, the company paid $205 million in cash associated with the acquisition of Kodiak Networks.

The company ended the quarter with record backlog of $8.9 billion, up $768 million from the year-ago quarter. Products segment backlog was up 24 percent or $344 million, and services backlog was up 6 percent or $424 million. LMR demand led by the Americas continues to drive the backlog growth.

“Q3 was another outstanding quarter of revenue and earnings growth,” said Greg Brown, chairman and CEO of Motorola Solutions. “I’m particularly pleased with our record backlog position, demonstrating continued strength of our LMR business.”

In a list of strategic wins, Motorola cited the following contracts:
• $79 million for a Project 25 (P25) system serving three counties in Oregon
• $54 million for a P25 system in Memphis, Tennessee
• $26 million for a 10-year managed and support services contract for the city of Phoenix
• $24 million for a P25 system in Burlington, New Jersey
• $10 million for a radio system expansion in Ecuador

For the fourth quarter, Motorola Solutions expects revenue growth of about 3 percent compared with the fourth quarter of 2016. For the full year, the company expects revenue growth of about 5 percent versus the prior outlook of 3 to 4 percent. The company’s board of directors increased its regular quarterly dividend by 11 percent to 52 cents per share.

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