SPY390.69+10.33 2.72%
DIA316.80+7.35 2.38%
IXIC13,592.46+400.12 3.03%

Press Release: Motorola Solutions Reports Fourth-Quarter and Full-Year Financial Results

· 02/04/2021 16:10
-- $100 million+ P25 managed services contract with State of Tasmania, Australia -- $79 million TETRA managed services contract extension in Europe -- $30 million P25 multi-year service contract with Minnesota DOT -- $29 million P25 multi-year service contract with Austin, Texas -- $11 million for a command center software contract in Norway-- Revenue - Full-year revenue was $7.4 billion, down 6% driven by declines in North America and International. The Products and Systems Integration segment declined 13% primarily due to lower sales of public safety LMR products and PCR, partially offset by growth in video security. The Software and Services segment grew 9% driven by growth in LMR services, video security and command center software. Revenue from acquisitions was $203 million, and the impact of unfavorable currency rates was $12 million. -- Operating earnings - For the full year, GAAP operating margin was 18.7% of revenue, compared with 20.0% for the prior year. The decrease was primarily driven by lower sales in the Products and Systems Integration segment, partially offset by higher sales and improved operating leverage in the Software and Services segment. Non-GAAP operating margin was 24.8% of revenue, compared with 25.0% for the prior year, driven by lower sales in Products and Systems Integration, partially offset by higher sales and improved operating leverage in the Software and Services segment. -- Taxes - The 2020 GAAP effective tax rate was 18.8%, compared to 13.0% for the prior year. The year-over-year increase in the GAAP rate was primarily due to the valuation allowance release of the US foreign tax credit in the prior year, offset by a higher tax benefit from share based compensation deduction in 2020. The non-GAAP effective tax rate was 20.0% compared with 22.4% in the previous year. The year-over-year decrease was driven by higher credits related to research and development and share based compensation recognized in the current year. -- Cash flow - The company generated $1.6 billion in operating cash, compared to $1.8 billion in the prior year. Free cash flow was $1.4 billion, compared to $1.6 billion in the prior year. The decrease in cash flow was driven by lower sales and higher cash taxes, partially offset by improvements in working capital. -- Backlog - The company ended the year with record backlog of $11.4 billion, up $175 million from the prior year. Software and Services segment backlog was up 3% or $213 million, primarily driven by growth in North America and $139 million of favorable currency rates, partially offset by revenue recognized for the Airwave and ESN contracts. Products and Systems Integrations segment backlog was down 1% or $38 million driven by delay in sales engagements related to COVID-19. -- Capital allocation - In 2020, the company repurchased $612 million of its common stock at an average price of $155.93, paid $436 million in dividends, and used $287 million for acquisitions. Additionally, the company refinanced approximately $900 million of debt with a new ten-year debt issuance at 2.3%.-- Revenue - Fourth-quarter revenue was $2.3 billion, down 4% from the year-ago quarter driven by declines in North America and International. The Products and Systems Integration segment declined 10% primarily due to lower sales of public safety LMR products and professional and commercial radio (PCR), partially offset by growth in video security. The Software and Services segment grew 8% driven by growth in LMR services, video security and command center software. Revenue from acquisitions was $60 million, and the impact of favorable currency rates was $19 million. -- Operating earnings - GAAP operating margin was 24.4% of sales, down from 24.8% in the year-ago quarter primarily due to lower sales in the Products and Systems Integration segment, partially offset by higher sales and improved operating leverage in the Software and Services segment. Non-GAAP operating margin was 29.3% of sales, down from 29.7% in the year-ago quarter primarily due to lower sales in the Products and Systems Integration segment, partially offset by higher sales and improved operating leverage in the Software and Services segment. -- Taxes - The GAAP effective tax rate was 20.9%, compared to (26.4)% in the year-ago quarter. The year-over-year increase in the GAAP rate was primarily due to the valuation allowance release of the US foreign tax credit in the year-ago quarter. The Non-GAAP effective tax rate was 21.0%, compared to 22.0% in the year-ago quarter. The year-over-year decrease was primarily driven by research and development credits recognized in 2020. -- Cash flow - The company generated $703 million in operating cash, compared with $795 million in the year-ago quarter. Free cash flow was $637 million, compared with $736 million in the year-ago quarter. The year-over-year decline in cash flow was primarily driven by lower sales in Q4 2020. -- Capital allocation - During the quarter, the company repurchased $171 million of its common stock and paid $109 million in dividends. Additionally, the company repaid the remaining $200 million of its revolving credit facility borrowing.Fourth Quarter Full Year Q4 2020 Q4 2019 % Change 2020 2019 % Change ------------- ---------- ---------- ---------- ---------- ---------- ---------- Sales $2,273 $2,377 (4)% $7,414 $7,887 (6)% -------------- ------ ------ ---- ------ ------ ----- GAAP Operating Earnings $555 $590 (6)% $1,383 $1,581 (13)% % of Sales 24.4% 24.8% 18.7% 20.0% EPS $2.37 1.39 71% $5.45 $4.95 10% -------------- ------ ------ ---- --- ------ ------ ----- Non-GAAP* Operating Earnings $667 $707 (6)% $1,835 $1,975 (7)% % of Sales 29.3% 29.7% 24.8% 25.0% EPS $2.86 $2.94 (3)% $7.69 $7.96 (3)% -------------- ------ ------ ---- ------ ------ ----- Products and Systems Integration Segment Sales $1,510 $1,673 (10)% $4,634 $5,329 (13)% GAAP Operating Earnings $351 $426 (18)% $656 $994 (34)% % of Sales 23.2% 25.5% 14.2% 18.7% Non-GAAP Operating Earnings* $408 $484 (16)% $880 $1,173 (25)% % of Sales 27.0% 28.9% 19.0% 22.0% -------------- ------ ------ ---------- ------ ------ ---------- Software and Services Segment Sales $763 $704 8% $2,780 $2,558 9% GAAP Operating Earnings $204 $164 24% $727 $587 24% % of Sales 26.7% 23.3% 26.2% 22.9% Non-GAAP Operating Earnings* $259 $223 16% $955 $802 19% % of Sales 33.9% 31.7% 34.3% 31.4% -------------- ------ ------ ---------- ------ ------ ------------ Revenue of $2.3 billion, down 4% from Q4 in the prior year; down 6% for full year -- Software and Services segment grew 8% in Q4; 9% for full year -- Record backlog of $11.4 billion, up $175 million or 2% from a year ago -- GAAP earnings per share (EPS) of $2.37; $5.45 for full year -- Non-GAAP EPS* of $2.86, down 3% from Q4 in the prior year; $7.69 for full year, down 3% -- Generated $703 million in operating cash flow in the quarter; $1.6 billion for full year CHICAGO--(BUSINESS WIRE)--February 04, 2021--

Motorola Solutions Reports Fourth-Quarter and Full-Year Financial Results

Company ends year with record backlog

Motorola Solutions, Inc. (NYSE: MSI) today reported its earnings results for the fourth quarter and full year of 2020. Click here for a printable news release and financial tables.

"Our fourth-quarter results, highlighted by record LMR orders in North America and continued strong growth in the Software and Services segment, reflect the criticality of our solutions and our team's unwavering execution throughout an unprecedented year," said Greg Brown, chairman and CEO, Motorola Solutions. "This momentum, combined with our record ending backlog, positions us very well for strong growth in 2021."

KEY FINANCIAL RESULTS (presented in millions, except per share data and percentages)

*Non-GAAP financial information excludes the after-tax impact of approximately $0.49 for Q4 and $2.24 for FY per diluted share related to share-based compensation, intangible assets amortization expense and highlighted items. Details on these non-GAAP adjustments and the use of non-GAAP measures are included later in this news release.

OTHER SELECT FOURTH-QUARTER FINANCIAL RESULTS

OTHER SELECT FULL-YEAR FINANCIAL RESULTS

NOTABLE WINS & ACHIEVEMENTS IN Q4

Software and Services

(MORE TO FOLLOW) Dow Jones Newswires

February 04, 2021 16:10 ET (21:10 GMT)