Itron, Inc. announced financial results for its first quarter ended March 31, 2022. Key results for the quarter include (compared with the first quarter of 2021):
- Revenue of $475 million, compared with $520 million;
- Gross margin of 28.4%; compared with 32.2%;
- GAAP net income of $1 million, compared with $13 million;
- GAAP diluted earnings per share (EPS) of $0.02, compared with $0.30;
- Non-GAAP diluted EPS of $0.11, compared with $0.52;
- Adjusted EBITDA of $19 million, compared with $50 million;
- Free cash flow of $2 million compared with $39 million; and
- Total backlog of $3.9 billion, compared with $3.4 billion.
"In the first quarter of 2022, customer demand remained strong with a focus on our Networked Solutions and Outcomes offerings. While we continue to be impacted by the current supply constraints and an inflationary environment, we remain focused on driving our strategy forward," said Tom Deitrich, Itron's president and chief executive officer.
Summary of First Quarter Consolidated Financial Results
Total first quarter revenue decreased 9% to $475 million, or 6%, excluding the impact of changes in foreign currency exchange rates. The decrease was due to the impact of component constraints limiting our ability to meet customer demand.
Device Solutions revenue declined 19%, and Networked Solutions and Outcomes revenue each decreased 3%.
Consolidated company gross margin of 28.4% decreased 380 basis points from the prior year, primarily due to higher component costs and manufacturing inefficiencies related to component shortages.
Operating Expenses and Operating Income
GAAP operating expenses of $128 million decreased $8 million from the prior year, primarily due to lower restructuring, amortization and product development expenses. Non-GAAP operating expenses of $126 million decreased $2 million from the prior year primarily due to lower product development expenses.
GAAP operating income of $7 million was $24 million lower than the prior year and non-GAAP operating income of $9 million was $30 million lower than last year. The decreases were due to lower gross profit.
Net Income and Earnings per Share
Net income attributable to Itron, Inc. for the quarter was $1 million, or $0.02 per diluted share, compared with $13 million, or $0.30 per diluted share in 2021. The decrease was driven by lower GAAP operating income.
Non-GAAP net income, which excludes certain charges including amortization of intangible assets, amortization of debt placement fees, debt extinguishment, restructuring, loss on sale of business, acquisition and integration, and the income tax effect of those adjustments, was $5 million, or $0.11 per diluted share, compared with $22 million, or $0.52 per diluted share, in 2021. The lower year over year results were primarily due to lower non-GAAP operating income.
Net cash provided by operating activities was $8 million in the first quarter compared with $50 million in the same quarter of 2021. Free cash flow was $2 million in the first quarter compared with $39 million in the prior year. The year over year decrease in cash flow was primarily due to higher variable compensation payments in the current period.
Total backlog was $3.9 billion and 12-month backlog was $1.6 billion, compared with $3.4 billion and $1.3 billion, respectively, in the prior year. Bookings in the quarter totaled $417 million.