Q3 2011 Earnings Call
October 26, 2011 8:00 am ET
LeRoy D. Nosbaum - Chief Executive officer, President and Director
Steven M. Helmbrecht - Chief Financial Officer and Senior Vice President
Barbara J. Doyle - Vice President of Investor Relations
John Quealy - Canaccord Genuity, Research Division
Craig E. Irwin - Wedbush Securities Inc., Research Division
Steven Milunovich - BofA Merrill Lynch, Research Division
Patrick Jobin - Crédit Suisse AG, Research Division
Benjamin J. Kallo - Robert W. Baird & Co. Incorporated, Research Division
Paul Coster - JP Morgan Chase & Co, Research Division
Todd Rosenbluth - S&P Equity Research
Sanjay Shrestha - Lazard Capital Markets LLC, Research Division
Stephen Sanders - Stephens Inc., Research Division
Previous Statements by ITRI
» Itron's CEO Discusses Q2 2011 Results - Earnings Call Transcript
» Itron's CEO Discusses Q1 2011 Results - Earnings Call Transcript
» Itron's CEO Discusses Q4 2010 Results - Earnings Call Transcript
Good day, everyone, and welcome to the Itron, Inc. Q3 2011 Earnings Conference Call. Today's call is being recorded. For opening remarks, I would like to turn the call over to Barbara Doyle. Please go ahead, ma'am.
Barbara J. Doyle
Thank you, Jenny, and good morning to everyone. Thank you for joining us so early. We have several announcements to coordinate today, including with employees around the world. So we're doing our call early today. We really do appreciate you joining us. And on the call today, we have LeRoy Nosbaum, our President and Chief Executive Officer; and Steve Helmbrecht, our Senior Vice President and Chief Financial Officer.
We issued a press release earlier today announcing our results. The press release includes replay information about today's call. We have prepared slides to accompany our remarks in this call, and we also have a copy of our prepared remarks on our web page as well. So the slides and the prepared remarks are available to the webcast link and to our corporate website under the Investor Relations tab.
If you turn to Slide 2, you'll see today's agenda. Before I turn the call over to LeRoy, please let me provide our Safe Harbor statement. Please note that our earnings release and financial presentation include non-GAAP financial information that we believe enhances the overall understanding of our current and future performance. We have included reconciliations of differences between GAAP and non-GAAP financial measures in our earnings release and our financial presentation.
Now if you turn to Slide 3, you'll see our Safe Harbor statement. We will be making statements during this call that are forward-looking. These statements are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could differ materially from these expectations because of factors discussed in today's earnings release and the comments made during this conference call and in the Risk Factors section of our Form 10-K, Form 10-Q and other reports and filings with the Securities and Exchange Commission. We do not undertake any duty to update our forward-looking statements.
Now let me please introduce LeRoy Nosbaum, Itron's President and Chief Executive Officer.
LeRoy D. Nosbaum
Thank you, Barbara. Good morning, everyone. Good to be back with all of you. Kind of interesting for me this morning. Thank you for dialing in to the Itron call. From talking with customers and employees, I'm beginning to understand what is happening in the business and in the field. From talking with many of you in the last several weeks, I think I have a fair idea of the things that are top of mind for investors. I'm listening carefully to our shareholders and the analysts that follow Itron. And I've fully realized that our communication with the investor community has been less than ideal. I'm committed to restoring Itron's credibility with investors and communicating a very clear vision of where Itron is heading.
For the most part, I'm going to let Steve talk about the quarter's results. I will say that while I am not pleased with all of the onetime items, particularly warranty expense, we did have a good operating quarter. I'd like to focus on the following areas in today's call. First, I'd like to share a few of my observations from my first 60 days. Second, bookings trends. I'll also comment on our smart electricity metering business in North America, which has been a significant driver of our bookings. Third, my views on 2012. Fourth, some comments on the restructuring project we announced today. And last, our share repurchase plan. I'll then hand the call over to Steve to cover third quarter results and guidance, and then I'll come back and wrap up with some remarks about long-range market opportunities and my vision for Itron. And then, of course, we'll take questions.
So let's begin starting with my first 60 days. The challenges we are facing as a company, as well as an industry, are becoming apparent. I also see opportunities, opportunities for Itron, for our customers and for our investors. Some investors have lost faith in the industry after all the hype that grew in the last 2 to 3 years about smart grid and energy investment. With so much focus on the hype in the industry, I believe Itron's well-diversified, global water, gas and electric business has been overlooked and undervalued. The deployment of smart grid, smart water and smart gas systems is critical for managing energy and water in this century. A big shift is happening, and Itron will continue to lead such important industry transitions. Large deployments in short periods of time will make any industry lumpy, especially early in the cycle, and they have in this one.
You can see on Slide 5, Itron's stable underlying core business growth, as well as the impact of selling smart meters, has had on the company's business. The point I'd like to make here is we do more than just smart electricity meters and that the other part of our grids business is growing nicely.