<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(MARK ONE)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934.
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934.
FOR THE TRANSITION PERIOD FROM _______________ TO _________________
Commission file number 0-21918
FLIR SYSTEMS, INC.
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C>
OREGON 93-0708501
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
</TABLE>
16505 S.W. 72ND AVENUE, PORTLAND, OREGON 97224
(Address of principal executive offices) (Zip Code)
(503) 684-3731
(Registrant's telephone number, including area code)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X . No _____.
At June 30, 1996, there were 5,332,031 shares of the Registrant's common stock,
$0.01, par value, outstanding.
<PAGE> 2
FLIR SYSTEMS, INC.
INDEX
PART I. FINANCIAL INFORMATION
<TABLE>
<S> <C> <C>
Item 1. Financial Statements
Consolidated Statement of Operations -- Three Months and Six
Months Ended June 30, 1996 and 1995 3
Consolidated Balance Sheet -- June 30, 1996 and December 31,
1995 4
Consolidated Statement of Cash Flows -- Six Months Ended June
30, 1996 and 1995 5
Notes to the Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations 8
PART II. OTHER INFORMATION
Item 4 Submission of Matters to a Vote of Shareholders 12
Item 6. Exhibits and Reports on Form 8-K 12
Signatures 13
</TABLE>
2
<PAGE> 3
PART 1. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
FLIR SYSTEMS, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
(in thousands, except per share amounts)
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
---------------------- ----------------------
1996 1995 1996 1995
------- ------- ------- -------
<S> <C> <C> <C> <C>
Revenues:
Night vision systems and sensors $ 9,991 $ 9,980 $16,470 $15,713
Commercial imaging systems 5,138 3,958 9,895 7,431
------- ------- ------- -------
15,129 13,938 26,365 23,144
Cost of goods sold 7,386 6,588 12,630 10,559
Research and development 2,166 2,228 4,283 4,109
Selling and other operating costs 4,039 3,848 7,775 6,786
------- ------- ------- -------
13,591 12,664 24,688 21,454
Earnings from operations 1,538 1,274 1,677 1,690
Interest income -- 31 29 129
Interest expense and other (129) (41) (225) (82)
------- ------- ------- -------
Earnings before income taxes 1,409 1,264 1,481 1,737
Provision for income taxes 303 140 319 197
------- ------- ------- -------
Net earnings $ 1,106 $ 1,124 $ 1,162 $ 1,540
======= ======= ======= =======
Net earnings per share $ 0.20 $ 0.20 $ 0.21 $ 0.28
======= ======= ======= =======
Weighted average number of common
shares and equivalents outstanding 5,603 5,513 5,559 5,532
======= ======= ======= =======
</TABLE>
The accompanying notes are an integral part of these financial statements
3
<PAGE> 4
FLIR SYSTEMS, INC.
CONSOLIDATED BALANCE SHEET
(in thousands, except share amounts)
<TABLE>
<CAPTION>
ASSETS
June 30, December 31,
1996 1995
----------- ------------
(unaudited)
<S> <C> <C>
Current assets:
Cash and cash equivalents . . . . . . . . . . . . . . . . . . $ 217 $ 1,154
Accounts receivable . . . . . . . . . . . . . . . . . . . . 25,653 24,898
Inventories . . . . . . . . . . . . . . . . . . . . . . . . 26,545 23,666
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . 581 439
------- -------
Total current assets . . . . . . . . . . . . . . . . . . 52,996 50,157
Property and equipment . . . . . . . . . . . . . . . . . . . . . 5,244 4,003
Software development costs . . . . . . . . . . . . . . . . . . . 631 469
Deferred income taxes . . . . . . . . . . . . . . . . . . . . . 1,800 1,800
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . 587 489
------- -------
$61,258 $56,918
======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Notes payable . . . . . . . . . . . . . . . . . . . . . . . $ 2,798 $ 2,056
Accounts payable . . . . . . . . . . . . . . . . . . . . . . 4,537 5,477
Accounts payable to related parties . . . . . . . . . . . . 404 273
Accrued payroll and other liabilities . . . . . . . . . . . 703 1,631
Accrued warranty reserve . . . . . . . . . . . . . . . . . . 863 893
Accrued commissions . . . . . . . . . . . . . . . . . . . . 256 923
Accrued income taxes . . . . . . . . . . . . . . . . . . . . 417 585
Current portion of long-term debt . . . . . . . . . . . . . 1,227 435
------- -------
Total current liabilities . . . . . . . . . . . . . . . 11,205 12,273
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . 5,047 1,175
Commitments and contingencies . . . . . . . . . . . . . . . . . -- --
Shareholders' equity:
Preferred stock, $0.01 par value, 10,000,000 shares authorized;
no shares issued at June 30, 1996, and December 31, 1995 -- --
Common stock, $0.01 par value, 30,000,000 shares authorized,
5,332,031 and 5,282,988 shares issued at June 30, 1996,
and December 31, 1995, respectively . . . . . . . . . . . 53 53
Additional paid-in capital . . . . . . . . . . . . . . . . . 40,626 40,252
Retained earnings . . . . . . . . . . . . . . . . . . . . . 4,327 3,165
------- -------
Total shareholders' equity . . . . . . . . . . . . . . . 45,006 43,470
------- -------
$61,258 $56,918
======= =======
</TABLE>
The accompanying notes are an integral part of these financial statements
4
<PAGE> 5
FLIR SYSTEMS, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(in thousands)
(unaudited)
<TABLE>
<CAPTION>
Six Months Ended June 30,
----------------------------
1996 1995
------- -------
<S> <C> <C>
Cash used by operations:
Net earnings . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,162 $ 1,540
Adjustments to reconcile net earnings to net cash used
by operating activities:
Depreciation . . . . . . . . . . . . . . . . . . . . . . . 936 941
Amortization . . . . . . . . . . . . . . . . . . . . . . . 209 247
Disposals and write-offs of property and equipment . . . . 244 28
Deferred income taxes . . . . . . . . . . . . . . . . . . -- (450)
Changes in certain assets and liabilities:
Increase in accounts receivable . . . . . . . . . . . . . (755) (4,219)
Increase in inventories . . . . . . . . . . . . . . . . . (2,879) (3,498)
Increase in prepaid expenses . . . . . . . . . . . . . . . (142) (2)
(Additions to) reduction of other assets . . . . . . . . . (98) 52
(Decrease) increase in accounts payable . . . . . . . . . (940) 54
Increase (decrease) in accounts payable to related parties 131 (169)
Decrease in accrued payroll and other liabilities . . . . (928) (609)
Decrease in accrued warranty reserve . . . . . . . . . . . (30) (7)
(Decrease) increase in accrued commissions . . . . . . . . (667) 29
Decrease in accrued income taxes . . . . . . . . . . . . . (168) (169)
------- -------
Cash used by operating activities . . . . . . . . . . . . . . (3,925) (6,232)
------- -------
Cash used by investing activities:
Additions to property and equipment . . . . . . . . . . . . . (2,505) (1,525)
Software development costs . . . . . . . . . . . . . . . . . . (287) (294)
------- -------
Cash used by investing activities . . . . . . . . . . . . . . (2,792) (1,819)
------- -------
Cash provided by financing activities:
Net increase in notes payable . . . . . . . . . . . . . . . . 742 1,974
Proceeds from long term debt . . . . . . . . . . . . . . . . . 5,000 94
Repayment of long term debt including current portion . . . . (336) (241)
Issuance of common stock . . . . . . . . . . . . . . . . . . . -- 39
Proceeds from exercise of stock options . . . . . . . . . . . 374 205
------- -------
Cash provided by financing activities . . . . . . . . . . . . 5,780 2,071
------- -------
Net decrease in cash and cash equivalents . . . . . . . . . . . . (937) (5,980)
Cash and cash equivalents, beginning of period . . . . . . . . . . 1,154 6,183
------- -------
Cash and cash equivalents, end of period . . . . . . . . . . . . . $ 217 $ 203
======= =======
</TABLE>
The accompanying notes are an integral part of these financial statements
5
<PAGE> 6
FLIR SYSTEMS, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
NOTE 1 -- BASIS OF PRESENTATION:
The accompanying consolidated financial statements are unaudited and have been
prepared by the Company pursuant to the rules and regulations of the Securities
and Exchange Commission. In the opinion of management, these statements have
been prepared on the same basis as the audited consolidated financial
statements and include all adjustments, consisting of only normal recurring
adjustments, necessary for a fair presentation of the consolidated financial
position and results of operations for the interim periods. Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such rules and regulations. These
consolidated financial statements should be read in conjunction with the
Company's audited financial statements and the notes thereto for the year ended
December 31, 1995.
The accompanying financial statements include the accounts of FLIR Systems,
Inc. and its subsidiaries. All intercompany accounts and transactions have
been eliminated. The results of the interim period are not necessarily
indicative of the results for the entire year.
Certain reclassifications have been made to the prior year's data to conform
with the current year's presentation. These reclassifications had no impact on
previously reported results of operations or shareholders' equity.
NOTE 2 -- REVENUE RECOGNITION:
Revenue is recognized when products are shipped or when services are performed,
except for certain long term contracts which are recorded on the
percentage-of-completion method. The percentage-of-completion method is used
for research and development contracts and for production contracts which
require significant amounts of initial engineering and development costs. The
percentage-of-completion is determined by relating the actual costs incurred to
date to total costs to complete the respective contract.
NOTE 3 -- NET EARNINGS PER SHARE:
Net earnings per share are based on the weighted average number of shares of
common stock and common stock equivalents outstanding during the periods,
computed using the treasury stock method for stock options.
6
<PAGE> 7
NOTE 4 -- INVENTORIES:
Inventories consist of the following (in thousands):
<TABLE>
<CAPTION>
June 30, December 31,
1996 1995
------- -------
<S> <C> <C>
Materials . . . . . . . . . . . . . . . . . . . . . . . $17,960 $16,151
Work-in-progress . . . . . . . . . . . . . . . . . . . . 6,686 6,057
Finished goods . . . . . . . . . . . . . . . . . . . . . 1,906 1,580
------- -------
26,552 23,788
Less - progress payments received from customers . . . . (7) (122)
------- -------
$26,545 $23,666
======= =======
</TABLE>
NOTE 5 -- CHANGES IN SHAREHOLDERS' EQUITY:
Changes in Shareholders' Equity consist of the following (in thousands):
<TABLE>
<CAPTION>
Additional
Preferred Common Paid-in Retained
stock stock Capital Earnings Total
--------- ------- ----------- -------- ------
<S> <C> <C> <C> <C> <C>
Balance, December 31, 1995 . . $ -- $ 53 $40,252 $3,165 $43,470
Common stock options exercised -- -- 374 -- 374
Net income for six month
period . . . . . . . . . . . -- -- -- 1,162 1,162
--------- ----- ------- ------ -------
Balance, June 30, 1996 . . . . $ -- $ 53 $40,626 $4,327 $45,006
========= ===== ======= ====== =======
</TABLE>
7
<PAGE> 8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS:
Overall. Net earnings for the three months ended June 30, 1996
remained consistent at $1.1 million or $0.20 per share in the second quarter of
1995 and 1996. For the six months ended June 30, 1996, net earnings decreased
24.5%, from $1.5 million or $0.28 per share in the first half of 1995 to $1.2
million or $0.21 per share in the first half of 1996. However, earnings from
operations for the three months ended June 30, 1996 increased 20.7%, from $1.3
million in the second quarter of 1995 to $1.5 million in the second quarter of
1996. The relatively constant net earnings for the second quarter compared to
fiscal 1995 and the decrease in net earnings for the six months ended June 30,
1996 compared to the first half of 1995 were primarily due to the increased
selling and other operating costs associated with the continued expansion of
sales and marketing personnel, the slight reduction in the gross profit
percentage, the increase in interest expense and the increase in the effective
tax rate for the Company.
Revenues. The Company's revenues for the three months ended June 30,
1996, increased 8.5%, from $13.9 million in the second quarter of 1995 to $15.1
million in the second quarter of 1996. Revenues from the sale of the Company's
commercial imaging systems continued their significant growth pattern,
increasing 29.8%, from $4.0 million in the second quarter of 1995 to $5.1
million in the second quarter of 1996. The improvement was principally
attributable to the inclusion of revenues from sales of the Company's new
aerial broadcast systems for the broadcast and entertainment markets which were
introduced in April of this year and the continued strong market acceptance of
the entire Prism family of products and other commercial products. Revenues
from the sale of night vision systems totaled $10.0 million in the second
quarter of 1996, which was consistent with the amount of revenues generated in
the second quarter of 1995. The lack of change was primarily a result of the
relatively consistent number of SAFIRE systems delivered in the second quarter
of 1995 and 1996 under contracts awarded by the United States Navy for use on
the Marine Corps' fleet of UH-1N "Huey" helicopters.
Revenues for the six months ended June 30, 1996, increased 13.9%, from $23.1
million in the first half of 1995 to $26.4 million in the first half of 1996.
Revenues from the sale of the Company's commercial imaging systems for the six
months ended June 30, 1996, increased 33.2% from the comparable period in 1995,
from $7.4 million in 1995 to $9.9 million in 1996. The improvement was
principally attributable to the inclusion of revenues from sales of the
Company's new aerial broadcast systems for the broadcast and entertainment
markets which were introduced in April of this year and the continued strong
market acceptance of the entire Prism family of products and other industrial
products. Revenues from the sale of night vision systems and sensors for the
six months ended June 30, 1996, totaled $16.5 million, an increase of 4.8% from
the $15.7 million in revenues generated in the first half of 1995. This growth
is primarily due to the increased sales of the SAFIRE thermal imaging system.
8
<PAGE> 9
As discussed in previous quarters, the Company is continuing to work through a
variety of supplier-related difficulties, as well as the complications of
dealing with a much more complex and extensive manufacturing process for the
industrial product line. Some of the Company's suppliers also experienced yield
declines due to higher production rates, which further limited the Company's
ability to effectively increase production. The Company has addressed these
problems with each of the suppliers by working with them to improve output by
expanding testing procedures and removing poor performing parts earlier in the
production process. In addition, the Company has qualified additional
suppliers to ensure there is sufficient material to meet the Company's growing
demand. These procedures are now beginning to achieve their objectives and the
new suppliers are beginning to deliver components from low rate production
runs. This has been an ongoing process and the Company is just now beginning to
see improved yields. The results for the quarter, however, continue to reflect
the lingering effects of the production issues in the Company's industrial
business.
As a percentage of total revenue, revenues from the sale of commercial imaging
systems for the second quarter of 1996 increased to 34.0%, as compared to 28.4%
in the second quarter of 1995. For the six months ended June 30, 1996 revenues
from the sale of commercial imaging systems increased to 37.5%, as compared to
32.1% for the first six months of 1995. These increases indicate that sales of
the Company's commercial imaging systems continue to comprise a larger
percentage of the Company's total revenue.
Revenue from sales outside the United States increased slightly as a percentage
of total revenue from approximately 28.6% to approximately 30.1% for the
quarters ended June 30, 1995 and 1996, respectively. The increase in the
percentage of international sales, despite the significant shipments to the
United States Government during the quarter was primarily due to increased
deliveries on existing international contracts and increased market penetration
of commercial products in Europe. For the first half of 1996, revenue from
sales outside the United States constituted 34.5% of total revenue, as compared
to 45.8% for the first half of 1995. While the percentage of revenues from
international sales will continue to fluctuate from quarter to quarter due to
the timing of shipments under existing international and domestic government
contracts, management anticipates that revenues from international sales as a
percentage of total revenues will continue to comprise a significant percentage
of revenues.
Gross profit. As a percentage of revenues, gross profit decreased
slightly from 52.7% in the second quarter of 1995 to 51.2% in the second
quarter of 1996 and decreased slightly from 54.4% to 52.1% for the six month
periods ended June 30, 1995 and 1996, respectively. These decreases in gross
profit as a percentage of revenue are principally attributed to increased
manufacturing costs associated with the detector production for the Prism SP
and Prism DS, increased shipments to instrumentalities of the U.S. Government
which aggregated $10.2 million in the first half of 1996 compared to $9.7 in
the first half of 1995 and the relatively low percentage of higher margin
international sales. Gross profit percentages are affected by a variety of
factors, including the mix of domestic and international night vision sales,
the more competitive nature of the commercial imaging market, and the impact of
competitive bids for significant government contracts.
9
<PAGE> 10
Research and development. Research and development expense for the
quarter remained relatively consistent at $2.2 million, and increased 4.2% for
the six months ended June 30, from $4.1 million in the first half of 1995 to
$4.3 million in the first half of 1996. As a percentage of revenue, research
and development expense decreased from 16.0% to 14.3% for the three months
ended June 30, 1995 and 1996, respectively and decreased from 17.8% to 16.2%
for the six months ended June 30, 1995 and 1996, respectively. The overall
level of research and development expense reflects the Company's continuing
emphasis on product development and new product introduction. The overall
decrease as a percentage of revenues reflects the fact that a relatively large
percentage of the research and development expense is fixed in nature. While
the Company expects the absolute dollar amount of research and development
expense to increase as the year progresses, research and development expense as
a percentage of total revenue should decline as revenues increase.
Selling and other operating costs. Selling and other operating costs
for the quarter increased 5.0%, from $3.8 million for the second quarter of
1995 to $4.0 million for the second quarter of 1996, and increased 14.6% for
the six months ended June 30, from $6.8 million in the first half of 1995 to
$7.8 million in the first half of 1996. As a percentage of revenue, selling
and other operating costs decreased from 27.6% to 26.7% for the three months
ended June 30, 1995 and 1996, respectively, and increased slightly from 29.3%
to 29.5% for the six months ended June 30, 1995 and 1996, respectively. The
increases in absolute dollar terms were primarily due to costs associated with
the increased revenues for the quarter, expenses related to the operations of
the Company's two subsidiaries, Broadcast & Surveillance Systems, Ltd. in the
United Kingdom and Optimas Corporation ("Optimas") in Seattle, and to
increased sales and marketing personnel. The Company has continued to expand
and strengthen the direct sales and marketing staff at both FSI and Optimas.
These efforts have directly resulted in increased sales of commercial products
and the Company continues to remain committed to making the strategic
investments necessary to ensure continued growth in revenues.
Income taxes. The provision for income taxes for the three months ended
June 30, 1996 resulted in an effective tax rate of 21.5% compared to 11.1% for
the second quarter of 1995. For the six months ended June 30, 1996 the
effective tax rate was 21.5% compared to 11.3% for the first half of 1995. The
increase in the effective tax rate is primarily due to the fact that the
Company has utilized all of its internally generated net operating loss
carryforwards. The effective tax rate remains substantially below statutory
rates due to utilization of a portion of the Company's acquired net operating
loss carryforwards, utilization of various tax credits, and benefits from the
favorable tax treatment of international revenue.
LIQUIDITY AND CAPITAL RESOURCES
At June 30, 1996, the Company had short term borrowings net of cash on hand of
$2.6 million compared with $902,000 at December 31, 1995 and $1.4 million at
March 31, 1996. Additionally during the quarter, the Company refinanced $5.0
million of short term borrowings over a five year period at 8.77% and increased
the available line of credit to $7.5 million. The increased use of cash during
the six months ended June 30, 1996, was principally attributable to increased
working capital needs, primarily increased inventory levels, greater accounts
receivable and decreased current liabilities.
10
<PAGE> 11
At June 30, 1996, the Company had inventory on hand of $26.5 million compared
to $23.7 million at December 31, 1995 and $26.1 million at March 31, 1996. The
increase in inventory levels is principally due to the build up of components
due to the production constraints related to the Company's Prism DS camera, an
increase in long lead components in anticipation of the SAFIRE deliveries to
the U.S. Government, and an increase in inventory levels to support the
production of the new aerial broadcast products. Additionally, inventory
levels at BSS continue to increase in anticipation of future deliveries under
existing contracts.
At June 30, 1996, the Company had accounts receivable in the amount of $25.7
million compared to $24.9 million at December 31, 1995. The level of accounts
receivable is primarily due to the significant level of sales in the last month
of the quarter primarily to the U.S. Navy.
The Company has available a $7.5 million line of credit which bears interest at
the prime rate. At June 30, 1996, the Company had a $2.8 million balance
outstanding on this line.
While use of the credit facility will vary significantly and is heavily
dependent upon the timing of collections from the U.S. Government, the Company
believes that its existing cash and available credit facilities will be
sufficient to meet its cash requirements for the foreseeable future.
11
<PAGE> 12
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SHAREHOLDERS
The Company's annual shareholders' meeting was held on Monday, April 29, 1996,
at which the following actions were taken by a vote of the shareholders:
1. The following persons were re-elected to the Board of
Directors by the votes and for the terms indicated:
<TABLE>
<CAPTION>
Vote
------------------------------------------
Withhold Term
Director For Authority Ending
-------- --- --------- ------
<S> <C> <C> <C>
Robert P. Daltry 4,423,523 29,523 1999
John C. Hart 4,424,365 28,681 1999
</TABLE>
2. By a vote of 2,811,448 to 712,774 (with 22,827 abstentions and
920,997 Broker Non-Votes), amendments to the FLIR Systems Inc. 1992
Stock Incentive Plan (the "Plan") to increase the number of shares
that are reserved for issuance upon the exercise of stock option
grants from 972,855 to 1,972,855 and to conform the Plan provisions
to certain requirements of the Internal Revenue Code, as amended,
were approved.
3. By a vote of 4,432,572 to 8,562 (with 11,912 abstentions and 15,000
Broker Non-Votes), the Company's selection of Price Waterhouse LLP as
the Company's independent auditors for the year ending December 31,
1996 was ratified.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits.
11.0 Computation of Net Income Per Share
27.1 Financial Data Schedule
(b) No reports on Form 8-K were filed during the three months ended June
30, 1996.
12
<PAGE> 13
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
FLIR SYSTEMS, INC.
Date August 14, 1996 /s/ J. Mark Samper
------------------------------ --------------------------
J. Mark Samper
Vice President of Finance and
Chief Financial Officer
(Principal Accounting and Financial
Officer and Duly Authorized Officer)
13
<PAGE> 1
EXHIBIT 11.0
FLIR SYSTEMS, INC.
COMPUTATION OF NET EARNINGS PER SHARE
(In thousands except per share data)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended June 30, Six Months Ended June 30,
--------------------------- -------------------------
1996 1995 1996 1995
------------ ------------ ---------- ----------
<S> <C> <C> <C> <C>
Net Earnings ...................... $1,106 $1,124 $1,162 $1,540
====== ====== ====== ======
Weighted average number of
common shares outstanding ....... 5,325 5,230 5,312 5,224
Assumed exercise of stock options
net of shares assumed reacquired
under the treasury stock method.. 278 283 247 308
------ ------ ------ ------
5,503 5,513 5,559 5,532
====== ====== ====== ======
Earnings Per Share ................ $ 0.20 $ 0.20 $ 0.21 $ 0.28
====== ====== ====== ======
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000354908
<NAME> FLIR SYSTEMS, INC.
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<EXCHANGE-RATE> 1
<CASH> 217
<SECURITIES> 0
<RECEIVABLES> 26,452
<ALLOWANCES> 800
<INVENTORY> 26,545
<CURRENT-ASSETS> 52,996
<PP&E> 11,638
<DEPRECIATION> 6,395
<TOTAL-ASSETS> 61,258
<CURRENT-LIABILITIES> 11,205
<BONDS> 5,047
0
0
<COMMON> 53
<OTHER-SE> 44,953
<TOTAL-LIABILITY-AND-EQUITY> 61,258
<SALES> 26,365
<TOTAL-REVENUES> 26,365
<CGS> 12,630
<TOTAL-COSTS> 12,630
<OTHER-EXPENSES> 12,058
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 196
<INCOME-PRETAX> 1,481
<INCOME-TAX> 319
<INCOME-CONTINUING> 1,162
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,162
<EPS-PRIMARY> .21
<EPS-DILUTED> .21
</TABLE>
