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Zebra Technologies' CEO Discusses Q2 2012 Results - Earnings Call Transcript

Now, let me turn the call over to Anders Gustafsson for some brief opening remarks.

Anders Gustafsson

Thank you, Doug, and good morning everyone. For the second quarter Zebra reported sales of $247 million and earnings from continuing operations of $0.58 per share. Second quarter revenues reflect the constraints of the business environment in Europe, where parts of Western Europe were more challenged than had been expected.

At the same time, the execution of our strategies to take share, penetrate key industries more deeply and build stronger ties from strategic accounts resulted in our delivering year-over-year and sequential sales growth, including strong growth in several emerging regions, 10% sales growth in North America and a new record for printer shipments.

The operational resilience of our business helped sustain a high gross margin of nearly 49%. We also maintained operating expenses in line with guidance with some anticipated expenditures for M&A, and other meaningful investments that position Zebra for long-term success and improving investment returns. We generated a strong $45.2 million in free cash flow reflecting continued effective management of working capital.

During the quarter we returned $14.9 million to shareholders through the buyback of 409,000 shares. Shortly after the end of the quarter, we announced the acquisition of LaserBand, which substantially enhances Zebra's position in healthcare, an attractive area for growth with industry-leading patient identification solutions.

Even with the current economic challenges all companies faced, we continue to have great confidence in Zebra's future. As our accomplishments in the second quarter demonstrate, we continue to build greater value for our customers and shareholders.

Over the past year, we have sharpened our focus on key industries with significant opportunity, such as retail, healthcare and manufacturing. Our performance in North America and emerging regions demonstrates the effectiveness of these strategies.

Zebra together with our partners is working to create a smarter, more connected business community. We are pursuing this vision through five strategic pillars. First, intensify innovation. Second, expand into new markets. Third, maximize operational effectiveness. Fourth, penetrate existing markets further. And lastly, inspire our people and culture.

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