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November 1, 2001
Garmin® Reports Third Quarter Earnings of
$0.23 Per Share
CAYMAN ISLANDS, Nov. 1, 2001 /PRNewswire/ -- Garmin Ltd today
announced EPS of $0.23 for its third fiscal quarter ended
Sept. 29, 2001, which is two cents above the high end of its
revised guidance of $0.20 to $0.21. This compares to $0.26
per share on a proforma basis in the year-ago quarter. Revenue
was $86.9 million for its third fiscal quarter ended Sept.
29, 2001 -- down 3 percent from the $89.5 million generated
in the year-ago quarter. Net income for the third quarter
of fiscal 2001 was $25.0 million compared to $28.3 million
in the year-ago quarter.
Third quarter 2001 net income included a $0.3 million foreign
currency gain as a result of a stronger U.S. dollar compared
to the New Taiwan dollar. Excluding the foreign currency gain,
EPS for the quarter was $0.23.
Consumer revenue totaled $64.1 million -- a 9 percent growth
compared to the third quarter of 2000. Aviation revenue totaled
$22.8 million -- a 26 percent decline compared to the year-ago
quarter. Total units sold for the quarter increased to 311,000
from 298,000 in 2000 -- representing an increase of 4 percent
compared to the year-ago quarter.
"We are pleased with the level of revenue and unit growth
within the consumer segment given the difficult economic environment,"
said Gary Burrell, co-CEO and co-chairman of Garmin Ltd. "The
increase in the consumer segment in this market environment
further evidences the continued growth of the GPS market and
is a tribute to the popularity of Garmin products among marine,
recreational, business and automotive users around the world.
However, there have been challenges within the aviation segment
due to the overall weak economy and recent restrictions on
U.S. airspace that occurred after Sept. 11. We believe that
the general aviation industry will gradually return to normal
levels as the FAA continues to ease restrictions on VFR flights.
There is reason to believe that the additional cost, inconvenience
and delays resulting from tightened commercial airline security
and reduction of scheduled flights will have a positive long-term
benefit relative to the efficiency and convenience of travel
on general aviation aircraft. According to the most recent
market report published by the Aircraft Electronics Association,
Garmin remains well positioned in the U.S. general aviation
retrofit GPS market, with unit volume market share of 73 percent
for GPS panel-mount products and 90 percent for portable aviation
GPS products."
Revenue for the nine-month year-to-date period ended Sept.
29, 2001 was $276.1 million -- up 6 percent from the $260.1
million generated in the year-ago period. Net income increased
9 percent for the period to $85.4 million, or $0.79 per share,
compared to $78.1 million or $0.72 per share on a proforma
basis in the year-ago period.
Net income for the nine-month period ended September 29,
2001 included a $7.7 million foreign currency gain as a result
of a stronger U.S. dollar compared to the New Taiwan Dollar.
Excluding the foreign currency gain, EPS for the period was
$0.73.
Consumer revenue totaled $193.5 million -- a 12 percent
growth compared to the prior period. Aviation revenue totaled
$82.6 million -- a 5 percent decline compared to the year-ago
period. Total units sold for the nine-month period increased
to 993,000 from 883,000 in 2000 -- representing an increase
of 12 percent so far this year.
"During the third fiscal quarter, gross margin increased
sequentially compared to the second fiscal quarter, from 53
percent to 55 percent due to changes in product mix and our
continuous improvement in manufacturing efficiencies,"
said Kevin Rauckman, chief financial officer of Garmin Ltd.
"We continue to generate significant cash flow, as net
cash flow increased to $61.3 million as of the year-to-date
period ended Sept. 29, 2001 compared to $31.9 million in the
year-ago period. We also continue to manage inventory levels
as inventory decreased by $24.0 million since fiscal year-end
2000."
Earnings Call Information
The information for Garmin Ltd.'s earnings call is
as follows:
When: Thursday, Nov. 1, 2001 at 11:00 a.m. Eastern
Where: event
calendar
How: Simply log on to the web at the address above or call
to listen in at 800-473-8796.
Contact: investor.relations@garmin.com
A phone recording will be available for 24 hours following
the earnings call and can be accessed by dialing 800-252-6030
utilizing the access code 10149840. An archive of the live
webcast will be available until November 15, 2001 on the Garmin
website. To access the replay, click on Investor
Relations, then Events
Calendar.
This release includes projections and other forward-looking
statements regarding Garmin Ltd. and its business. Any statements
regarding the company’s future financial position, revenues,
earnings, product introductions, 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. Information concerning risk factors
that could affect Garmin's actual results is contained
in the Annual Report on Form 10-K for the year ended December
30, 2000 filed by Garmin with the Securities and Exchange
Commission (Commission file number 0-31983). A copy of Garmin's
Form 10-K can be downloaded from http://www.garmin.com/aboutGarmin/invRelations/finReports.html.
Through its operating subsidiaries, Garmin Ltd. designs
and manufactures navigation, communication and information
electronics. The company's primary markets are aviation, marine,
outdoor recreation, automotive, wireless and OEM. Garmin Ltd.
is incorporated in the Cayman Islands, and its principal subsidiaries
are located in the United States, Taiwan and United Kingdom.
For more information, visit the Investor
Relations site of Garmin Ltd. at www.garmin.com
or contact the Investor Relations department at 913-397-8200.
Garmin Ltd. And Subsidiaries
Condensed Consolidated Statements of Income
(In thousands, except per share information)
| |
Three
Months Ended |
(Unaudited)
September 29, 2001 |
September
23, 2000 |
| Net sales |
$86,930 |
$89,539 |
| Cost of goods sold |
39,201 |
40,508 |
| Gross profit |
47,729 |
49,031 |
| Selling, general, and administrative expense |
9,663 |
8,603 |
| Research and development expense |
7,306 |
5,755 |
| |
16,969 |
14,358 |
| Operating income |
30,760 |
34,673 |
| Other income (expense) (A) |
2,742 |
2,360 |
| Income before income taxes |
33,502 |
37,033 |
| Income tax provision |
8,501 |
9,010 |
| Net income |
$36,603 |
8,741 |
|
Net income per share:
Basic
Diluted
|
$ 0.23
$ 0.23 |
$ 0.28
$ 0.28 |
|
Weighted average common shares outstanding:
Basic
Diluted
|
108,232
108,599 |
100,000
100,000 |
(A) Includes $0.3 million of foreign currency gain in Q3
2001 and a $1.6 million gain in Q3 2000.
Garmin Ltd. And Subsidiaries
Condensed Consolidated Statements of Income
(In thousands, except per share information)
| |
Nine
Months Ended |
(Unaudited)
September 29, 2001 |
September
23, 2000 |
| Net sales |
$276,098 |
$260,079 |
| Cost of goods sold |
127,401 |
119,110 |
| Gross profit |
148,697 |
140,969 |
| Selling, general, and administrative expense |
28,723 |
23,678 |
| Research and development expense |
20,367 |
15,474 |
| |
49,090 |
39,152 |
| Operating income |
99,607 |
101,817 |
| Other income (expense) (A) |
14,862 |
351 |
| Income before income taxes |
114,469 |
102,168 |
| Income tax provision |
29,066 |
24,116 |
| Net income |
$85,403 |
$78,052 |
|
Net income per share:
Basic
Diluted
|
$ 0.79
$ 0.79
|
$ 0.78
$ 0.78 |
|
Weighted average common shares outstanding:
Basic
Diluted
|
108,239
108,621 |
100,000
100,000 |
(A) Includes $7.7 million of foreign currency gain for the
nine-month period ended September 29, 2001 and a $1.4 million
loss for the nine-month period ended September 23, 2000.
Garmin Ltd. And Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands)
| Assets |
|
J(Unaudited)
September 29, 2001 |
September
23, 2000 |
|
Current assets:
Cash and cash equivalents
Accounts receivable
Inventories
Deferred income taxes
Prepaid expenses and other current assets
|
$313,269
43,190
65,840
11,719
5,447 |
$251,731
32,719
89,855
12,293
1,423 |
| Total current assets |
439,465 |
388,021 |
| Property and equipment, net |
68,790 |
64,704 |
| Other assets, net |
21,206 |
10,622 |
| Total assets |
$529,461 |
$463,347 |
|
Liabilities
and Stockholders' Equity |
|
|
|
Current liabilities:
Accounts payable
Salaries and benefits payable
Warranty reserve
Income taxes payable
Other accrued liabilities
|
$14,662
3,314
4,696
14,529
6,202 |
$22,496
3,441
5,228
5,795
5,081 |
| Total current liabilities |
43,403 |
42,041 |
| Long-term debt |
35,544 |
46,359 |
| Deferred income taxes |
8,216 |
9,616 |
| Other liabilities |
1,021 |
92 |
|
Stockholders' equity:
Common stock
Additional paid-in capital
Retained earnings
Accumulated other comprehensive loss
|
1,082
133,925
338,396
(32,126)
|
1,082
133,925
253,140
(22,908) |
| Total stockholders' equity |
441,277 |
365,239 |
| Total liabilities and stockholders' equity |
$529,461 |
$463,347 |
Source: Garmin Ltd.
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