This release includes projections and other forward-looking statements regarding Garmin Ltd. and its business. Any statements regarding the company’s estimated earnings and revenue for fiscal 2010, the Company’s expected segment revenue growth rate, margins, new products to be introduced in 2010 and the company’s plans and objectives are forward-looking statements. The forward-looking events and circumstances discussed in this release may not occur and actual results could differ materially as a result of risk factors affecting Garmin, including, but not limited to, the risk factors that are described in the Annual Report on Form 10-K for the year ended December 26, 2009 filed by Garmin with the Securities and Exchange Commission (Commission file number 0-31983). A copy of Garmin’s 2009 Form 10-K can be downloaded from
http://www.garmin.com/aboutGarmin/invRelations/finReports.html.
The global leader in satellite navigation, Garmin Ltd. and its subsidiaries have designed, manufactured, marketed and sold navigation, communication and information devices and applications since 1989 – most of which are enabled by GPS technology. Garmin’s products serve automotive, mobile, wireless, outdoor recreation, marine, aviation, and OEM applications. Garmin Ltd. is incorporated in the Cayman Islands, and its principal subsidiaries are located in the United States, Taiwan and the United Kingdom. For more information, visit Garmin's virtual pressroom at www.garmin.com/pressroom or contact the Media Relations department at 913-397-8200.
Garmin, nüvi and Forerunner are registered trademarks, and G Motion, trafficTrends, myTrends, nüvifone and Garminfone are trademarks, of Garmin Ltd. or its subsidiaries. All other brands, product names, company names, trademarks and service marks are the properties of their respective owners. All rights reserved.
Garmin Ltd. And Subsidiaries | ||||||||||||||||||
Condensed Consolidated Balance Sheets | ||||||||||||||||||
(In thousands, except share information) | ||||||||||||||||||
(Unaudited) | ||||||||||||||||||
March 27, | December 26, | |||||||||||||||||
2010 | 2009 | |||||||||||||||||
Assets | ||||||||||||||||||
Current assets: | ||||||||||||||||||
Cash and cash equivalents | $ | 1,291,343 | $ | 1,091,581 | ||||||||||||||
Marketable securities | 19,635 | 19,583 | ||||||||||||||||
Accounts receivable, net | 418,520 | 874,110 | ||||||||||||||||
Inventories, net | 356,073 | 309,938 | ||||||||||||||||
Deferred income taxes | 60,361 | 59,189 | ||||||||||||||||
Prepaid expenses and other current assets | 63,427 | 39,470 | ||||||||||||||||
Total current assets | 2,209,359 | 2,393,871 | ||||||||||||||||
Property and equipment, net | 432,606 | 441,338 | ||||||||||||||||
Marketable securities | 681,049 | 746,464 | ||||||||||||||||
Restricted cash | 941 | 2,047 | ||||||||||||||||
Licensing agreements, net | 6,573 | 15,400 | ||||||||||||||||
Noncurrent deferred income tax | 20,499 | 20,498 | ||||||||||||||||
Other intangible assets, net | 200,501 | 206,256 | ||||||||||||||||
Total assets | $ | 3,551,528 | $ | 3,825,874 | ||||||||||||||
Liabilities and Stockholders' Equity | ||||||||||||||||||
Current liabilities: | ||||||||||||||||||
Accounts payable | $ | 109,904 | $ | 203,388 | ||||||||||||||
Salaries and benefits payable | 34,017 | 45,236 | ||||||||||||||||
Accrued warranty costs | 58,814 | 87,424 | ||||||||||||||||
Accrued sales program costs | 41,201 | 119,150 | ||||||||||||||||
Deferred revenue | 35,835 | 27,910 | ||||||||||||||||
Accrued advertising expense | 10,135 | 34,146 | ||||||||||||||||
Other accrued expenses | 63,877 | 143,568 | ||||||||||||||||
Income taxes payable | 25,816 | 22,846 | ||||||||||||||||
Dividend payable | 299,957 | - | ||||||||||||||||
Total current liabilities | 679,556 | 683,668 | ||||||||||||||||
Deferred income taxes | 10,558 | 10,170 | ||||||||||||||||
Non-current income taxes | 259,751 | 255,748 | ||||||||||||||||
Non-current deferred revenue | 45,470 | 38,574 | ||||||||||||||||
Other liabilities | 1,258 | 1,267 | ||||||||||||||||
Stockholders' equity: | ||||||||||||||||||
Common stock, $0.005 par value, 1,000,000,000 shares authorized: Issued and outstanding shares - 199,128,000 as of March 27, 2010 and 200,274,000 as of December 26, 2009 |
994 | 1,001 | ||||||||||||||||
Additional paid-in capital | - | 32,221 | ||||||||||||||||
Retained earnings | 2,552,920 | 2,816,607 | ||||||||||||||||
Accumulated other comprehensive gain/(loss) | 1,021 | (13,382 | ) | |||||||||||||||
Total stockholders' equity | 2,554,935 | 2,836,447 | ||||||||||||||||
Total liabilities and stockholders' equity | $ | 3,551,528 | $ | 3,825,874 | ||||||||||||||
Garmin Ltd. And Subsidiaries | |||||||||||||||||||
Condensed Consolidated Statements of Income (Unaudited) | |||||||||||||||||||
(In thousands, except per share information) | |||||||||||||||||||
13-Weeks Ended | |||||||||||||||||||
March 27, | March 28, | ||||||||||||||||||
2010 | 2009 | ||||||||||||||||||
Net sales | $ | 431,067 | $ | 436,699 | |||||||||||||||
Cost of goods sold | 200,158 | 240,704 | |||||||||||||||||
Gross profit | 230,909 | 195,995 | |||||||||||||||||
Advertising expense | 17,400 | 23,225 | |||||||||||||||||
Selling, general and administrative expense | 67,678 | 59,777 | |||||||||||||||||
Research and development expense | 62,483 | 55,034 | |||||||||||||||||
Total operating expense | 147,561 | 138,036 | |||||||||||||||||
Operating income | 83,348 | 57,959 | |||||||||||||||||
Interest income | 6,879 | 5,097 | |||||||||||||||||
Foreign currency | (46,537 | ) | (2,438 | ) | |||||||||||||||
Other | 1,833 | (694 | ) | ||||||||||||||||
Total other income (expense) | (37,825 | ) | 1,965 | ||||||||||||||||
Income before income taxes | 45,523 | 59,924 | |||||||||||||||||
Income tax provision | 8,194 | 11,386 | |||||||||||||||||
Net income | $ | 37,329 | $ | 48,538 | |||||||||||||||
Net income per share: | |||||||||||||||||||
Basic | $ | 0.19 | $ | 0.24 | |||||||||||||||
Diluted | $ | 0.19 | $ | 0.24 | |||||||||||||||
|
|||||||||||||||||||
Weighted average common shares outstanding: |
|||||||||||||||||||
Basic | 199,926 | 200,352 | |||||||||||||||||
Diluted | 201,091 | 200,725 | |||||||||||||||||
Garmin Ltd. And Subsidiaries | ||||||||||||||||||||
Condensed Consolidated Statements of Cash Flows (Unaudited) | ||||||||||||||||||||
(In thousands) | ||||||||||||||||||||
13-Weeks Ended | ||||||||||||||||||||
March 27, | March 28, | |||||||||||||||||||
2010 | 2009 | |||||||||||||||||||
Operating Activities: | ||||||||||||||||||||
Net income | $ | 37,329 | $ | 48,538 | ||||||||||||||||
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||||||||||||||
Depreciation | 13,543 | 13,574 | ||||||||||||||||||
Amortization | 8,334 | 8,088 | ||||||||||||||||||
Gain on sale of property and equipment | (6 | ) | (3 | ) | ||||||||||||||||
Provision for doubtful accounts | (1,260 | ) | (1,101 | ) | ||||||||||||||||
Deferred income taxes | (1,546 | ) | (3,200 | ) | ||||||||||||||||
Foreign currency transaction gains/losses | 47,773 | (420 | ) | |||||||||||||||||
Provision for obsolete and slow moving inventories | 3,140 | 7,709 | ||||||||||||||||||
Stock compensation expense | 9,700 | 10,587 | ||||||||||||||||||
Realized losses/(gains) on marketable securities | (805 | ) | 1,274 | |||||||||||||||||
Changes in operating assets and liabilities, net of acquisitions: | ||||||||||||||||||||
Accounts receivable | 436,446 | 318,095 | ||||||||||||||||||
Inventories | (50,168 | ) | 58,876 | |||||||||||||||||
Other current assets | (606 | ) | (1,128 | ) | ||||||||||||||||
Accounts payable | (94,717 | ) | (77,595 | ) | ||||||||||||||||
Other current and non-current liabilities | (216,868 | ) | (88,727 | ) | ||||||||||||||||
Deferred revenue | 14,286 | - | ||||||||||||||||||
Income taxes payable | (4,048 | ) | 3,993 | |||||||||||||||||
Purchase of licenses | (396 | ) | 856 | |||||||||||||||||
Net cash provided by operating activities | 200,131 | 299,416 | ||||||||||||||||||
Investing activities: | ||||||||||||||||||||
Purchases of property and equipment | (3,935 | ) | (13,136 | ) | ||||||||||||||||
Purchase of intangible assets | (5,029 | ) | (872 | ) | ||||||||||||||||
Purchase of marketable securities | (74,303 | ) | (68,662 | ) | ||||||||||||||||
Redemption of marketable securities | 146,073 | 16,638 | ||||||||||||||||||
Change in restricted cash | 1,106 | 43 | ||||||||||||||||||
Net cash provided by/(used in) investing activities | 63,912 | (65,989 | ) | |||||||||||||||||
Financing activities: | ||||||||||||||||||||
Proceeds from issuance of common stock from stock purchase plan |
2,725 | 119 | ||||||||||||||||||
Stock repurchase | (47,206 | ) | (1,849 | ) | ||||||||||||||||
Tax benefit related to stock option exercise | 1,408 | 26 | ||||||||||||||||||
Net cash used in financing activities | (43,073 | ) | (1,704 | ) | ||||||||||||||||
Effect of exchange rate changes on cash and cash equivalents | (21,208 | ) | (5,729 | ) | ||||||||||||||||
Net increase in cash and cash equivalents | 199,762 | 225,994 | ||||||||||||||||||
Cash and cash equivalents at beginning of period | 1,091,581 | 696,335 | ||||||||||||||||||
Cash and cash equivalents at end of period | $ | 1,291,343 | $ | 922,329 | ||||||||||||||||
Garmin Ltd. And Subsidiaries | ||||||||||||||||||||||||||||
Revenue, Gross Profit, and Operating Income by Segment (Unaudited) | ||||||||||||||||||||||||||||
Reporting Segments | ||||||||||||||||||||||||||||
Outdoor/ | Auto/ | |||||||||||||||||||||||||||
Fitness |
Marine |
Mobile |
Aviation |
Total |
||||||||||||||||||||||||
13-Weeks Ended March 27, 2010 | ||||||||||||||||||||||||||||
Net sales | $ | 102,736 | $ | 41,314 | $ | 220,924 | $ | 66,093 | $ | 431,067 | ||||||||||||||||||
Gross profit | $ | 65,561 | $ | 24,231 | $ | 94,775 | $ | 46,342 | $ | 230,909 | ||||||||||||||||||
Operating income | $ | 38,568 | $ | 8,929 | $ | 16,982 | $ | 18,869 | $ | 83,348 | ||||||||||||||||||
13-Weeks Ended March 28, 2009 | ||||||||||||||||||||||||||||
Net sales | $ | 80,004 | $ | 38,017 | $ | 259,586 | $ | 59,092 | $ | 436,699 | ||||||||||||||||||
Gross profit | $ | 48,424 | $ | 22,878 | $ | 84,183 | $ | 40,510 | $ | 195,995 | ||||||||||||||||||
Operating income | $ | 28,504 | $ | 10,572 | $ | 4,605 | $ | 14,278 | $ | 57,959 |