Garmin Reports Record Year in Revenue and Net
Income, Strong Fourth Quarter Sales and Income Growth
CAYMAN ISLANDS, Feb. 14 Garmin Ltd. today
announced revenue of $85.7 million in its fourth fiscal quarter ended Dec. 30,
2000, up 26 percent from the $68.1 million generated in the year-ago quarter.
Net income for the fourth quarter of fiscal 2000 was $27.6 million, or
$0.27 per share -- exceeding consensus EPS estimates of $0.22 -- compared to
$20.6 million or $0.21 per share in the year-ago quarter.
Revenue growth was strong across both business segments during the fourth
quarter as Consumer revenue totaled $56.8 million, an 18 percent growth
compared to the fourth quarter of 1999. Aviation revenue totaled
$28.9 million, a 45 percent growth compared to the year-ago quarter.
For the fiscal year 2000, the company reported record revenue of
$345.7 million, up 49 percent compared to the revenues of $232.6 million in
fiscal 1999. Record net income for the fiscal year 2000 was $105.7 million,
or $1.05 per share, compared to $64.2 million, or $0.64 per share, in fiscal
1999 -- a 63 percent increase.
"We are pleased with concluding our tenth consecutive year with revenue
growth," said Gary Burrell, co-CEO and co-chairman of Garmin Ltd. "Results
were solid across consumer and aviation segments for both the quarter and the
year. Our GPS-enabled products continued to sell well in the fourth quarter,
despite a challenging economic environment."
During the fourth quarter, the company completed an initial public
offering of 10.5 million shares on the Nasdaq National Market, despite
difficult market conditions, and raised net proceeds of $104.4 million. Stock
options, stock purchase and 401K stock plans were established during the
quarter enabling employees an opportunity for direct investment in Garmin.
Q4 2000 net income included an $8.4 million foreign currency gain and the
fiscal 2000 results included a $7.0 million foreign currency gain as a result
of a stronger U.S. dollar compared to the New Taiwan dollar.
Due to Garmin's vertical integration strategy and long-term relationships
with key suppliers, the company was able to meet production schedules despite
industry-wide component shortages. During fiscal 2000, Garmin expanded its
distribution capabilities by offering a broader range of products and entered
into new retail distribution channels such as CompUSA, Canadian Tire and Car
Toys. Additional facility expansion allowed the company to occupy its new
warehouse at Olathe that include automated pick modules that have enhanced
shipping efficiency.
"Because Q4 2000 revenue exceeded our earlier projections by $6 million,
we have lowered our Q1 2001 forecast accordingly to account for earlier than
expected shipments in December 2000," said Kevin Rauckman, chief financial
officer of Garmin Ltd. "However, our fiscal 2001 projections remain
unchanged."
The quarterly earnings call will take place today at 11 a.m. (EDT) and be
broadcast over the Internet at
http://www.garmin.com/aboutGarmin/invRelations/irCalendar2.html . An archive of the
earnings webcast will be available on Garmin's website until Feb. 28.
Through its operating subsidiaries, Garmin Ltd. designs and manufactures
navigation, communication and information devices. 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.
Garmin went public on Dec. 8, 2000. Its stock is traded on the Nasdaq
National Market under the symbol GRMN. More information is available at
http://www.garmin.com .
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, 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 its Registration Statement on Form S-1 filed on Dec. 8, 2000 with the
Securities and Exchange Commission.
Garmin Ltd. And Subsidiaries
Condensed Consolidated Statements of Income
(In thousands, except per share information)
Three Months Ended Year Ended
Dec. 30, Dec. 25, Dec 30, Dec. 25,
2000 1999 2000 1999
Net sales $85,662 $68,050 $345,741 $232,586
Cost of goods sold 42,905(A) 29,224 162,015 105,654
Gross profit 42,757 38,826 183,726 126,932
Selling, general and
administrative expenses 8,991 7,868 32,669 27,063
Research and development
expense 6,290 4,863 21,764 17,339
Operating income 27,476 26,095 129,293 82,530
Other income (expense) 11,278(B) 904 11,629(B) 1,602
Income before income taxes 38,754 26,999 140,922 84,132
Income tax provision 11,143 6,407 35,259 19,965
Net income $27,611 $20,592 $105,663 $64,167
Net income per share
Basic $0.27 $0.21 $1.05 $0.64
Diluted $0.27 $0.21 $1.05 $0.64
Weighted average common
shares outstanding:
Basic 101,850 100,000 100,489 100,000
Diluted 101,915 100,000 100,506 100,000
(A) Includes $2.7 million of charges related to inventory reserves
recorded in Q4 2000
(B) Includes $8.4 million of foreign currency gain in Q4 2000 and a
$7.0 million gain in FY2000
Garmin Ltd. And Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands)
Year Ended
Dec 30, Dec. 25,
2000 1999
Assets
Current assets:
Cash and cash equivalents $251,731 $104,079
Accounts receivable 32,719 35,908
Inventories 89,855 51,248
Deferred income taxes 12,293 5,883
Prepaid expenses 1,423 864
Total current assets 388,021 197,982
Property and equipment, net 64,704 55,851
Deferred income taxes ---- 75
Restricted cash 5,848 ----
Other assets 4,774 737
Total assets $463,347 $254,645
Liabilities and Stockholder's Equity
Current liabilities:
Accounts payable $22,496 $15,402
Salaries and benefits payable 3,441 2,928
Warranty reserve 5,228 4,429
Income taxes payable 5,795 4,580
Other accrued liabilities 5,082 4,902
Total current liabilities 42,042 32,241
Long-term debt 46,359 27,715
Deferred income taxes 9,616 ----
Other liabilities 92 90
Stockholder's equity:
Common stock 1,082 1,000
Additional paid-in capital 133,925 29,593
Retained earnings 253,139 176,431
Accumulated other comprehensive loss (22,908) (12,425)
Total stockholder's equity 365,238 194,599
Total liabilities and stockholder's equity $463,347 $254,645
