Tuesday, March 3, 2009

Financial indicator?

ISRA is one of the biggest vision integrators in the industry, so their finances ought to give the rest of us a clue as to how 2009 is shaping up.

Their results for the last quarter of ’08 (which is the first quarter of their financial year,) show that they managed increases in both revenues and EBITDA. (Check out the report in ‘
Vision Systems Design.’)

Why then are they so cautious about the outlook for the rest of this year?

I suggest that this is because integration is a long leadtime kind of business. The systems they delivered, and got paid for, at the end of calendar 2008 had been quoted and ordered very much earlier – perhaps 12 months earlier – in other words, before manufacturing industry followed the Banks over the cliff. A more telling indicator would be a measure of order input and on that subject they seem to be keeping quiet.

Let’s just hope that recovery appears before they’ve worked their way through that big “order backlog.”

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