Trimble Announces Significantly Better Than Expected Second Fiscal SUNNYVALE, Calif., Jul 24, 2001 Trimble (Nasdaq: TRMB), a leading innovator of positioning and location-based solutions, today announced that revenue and earnings for its second fiscal quarter ended June 29, 2001 were significantly higher than the Company's previous guidance. The second quarter has traditionally been the Company's strongest quarter due to the seasonal nature of the Engineering and Construction business. Trimble reported second quarter 2001 revenues of approximately $133.6 million, an increase over the Company's previous revenue guidance of $118 to $122 million. Trimble also achieved a return to profitability on an adjusted basis, reporting adjusted earnings per share (EPS) of $.24 for the second quarter. Earlier guidance had been for a profit of $.03 - $.09. Adjusted EPS excludes amortization costs from acquisitions, a previously announced restructuring charge related to the Company's cost cutting actions, and the additional profit realized from the sale of a minority investment.
"The second quarter, which has traditionally been our strongest, marked our expected return to profitability," said Steven W. Berglund, president and CEO. "Despite continued economic uncertainty, we are encouraged by our results, which highlight the fundamental strength of our products. For example, we saw particularly strong sales of our new, advanced line of integrated GPS and optical land survey tools, our GPS machine control products, and timing products for wireless communications networks. Additionally, we achieved a significant improvement in our GIS division. We believe demand for GIS products should remain relatively steady through the second half of the year."
Business Segment Detail
Engineering and Construction revenues grew 18 percent sequentially to $86.7 million from $73.7 million in the first quarter. This represented 65 percent of total revenues. Demand for the Company's newly introduced line of integrated Land Survey products continued to accelerate throughout the second quarter. Other areas of strength included GPS machine control, which grew over 25 percent, both on a sequential and a pro-forma year-over-year basis. Part of this strength was a result of higher sales from Trimble's OEM relationship with Caterpillar due to increased demand in the mining industry.
Revenues from the Components Technologies segment were $16.6 million, a 3 percent increase sequentially and 13 percent year-over-year. This business represented 12 percent of total revenues for the quarter. The Company saw particular strength in its timing products for wireless communication networks. Additionally, in April, Trimble introduced the M-Loc(TM) MPM module based on its FirstGPS(TM) technology. This product has a very small footprint and was designed to provide a low cost and low power module to fill the technology gap between GPS boards and chipsets. It gives high-volume manufacturers of mobile devices a higher level of integration and the economic advantage of faster time to market.
Fleet and Asset Management revenues were $15.2 million, a 29 percent increase over the first quarter. This represented 11 percent of total sales. During the quarter Trimble announced the formation of Trimble Information Services, Inc., to offer Internet location-based services for the mobile workplace. On the GIS side, initial indications showed strong interest for the Company's recently introduced GPS Pathfinder(R) Pocket receiver. Additionally, at the ESRI International User Conference, the Company introduced GPS Pathfinder Express, a new service for processing GPS field data online, and MediaMapper(R) software, which allows easy integration of digital imagery with GPS data from Trimble's GIS data collection systems.
Revenues from Portfolio Technologies were $8.2 million, or 6 percent of total revenues. Tripod Data Systems (TDS) remained a bright spot as revenues increased by greater than 25 percent over the first quarter. Additionally, Trimble's Military and Advanced Systems group was awarded a $2.7 million contract from Boeing.
The Company has previously indicated that the second quarter is historically weaker in the agriculture market due to seasonality. For the second quarter, revenues for this segment were $6.7 million, down 18 percent sequentially. This represented 5 percent of total revenues. Despite the decrease, customer acceptance of Trimble's AgGPS(R) Autopilot system was very positive as farmers continued to discover the benefits and significant cost savings of this tool. The Company also expanded the agriculture product portfolio to offer a portable computing solution for its field management systems with the introduction of the AgGPS160 Portable Computer.
Berglund commented, "As we move forward, Trimble has the broadest portfolio of advanced positioning and location-based solutions in the industry. Our organization-wide focus is now on expanding the distribution of our solutions into new markets and increasing penetration in our existing markets. We are confident that we have the right strategy to grow the Company, and have taken additional steps to enable our success by lowering our operating and manufacturing costs in order to maintain our profitability during this time of economic uncertainty. At the same time, we are continuing to invest in the areas that will drive our long-term growth."
As a result of seasonality in certain end-markets, as well as on a geographic basis, Trimble expects third quarter revenues to be down sequentially to approximately $120 million. This is in-line with previous expectations. At these levels, the Company expects adjusted EPS of approximately $.04-$.06. For fiscal 2001, Trimble now expects revenues of approximately $495 million. Previous guidance was for revenues of $475-$490 million.
The Company will hold a conference call Tuesday, July 24th, 2001 at 8:00 a.m. Pacific Time to review its second quarter results and forward-looking guidance. The dial in number is +1-303-262-2175 for domestic and international callers. A replay of the call will be available for 48 hours beginning at 10:00 a.m., PDT. The replay number is +1-800-405-2236, and the passcode is 371238#. The conference call will also be broadcast live on the web at www.trimble.com, Investors Relations page.
Certain statements made in this press release are forward looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, and are made pursuant to the safe harbor provisions of the Securities Litigation Reform Act of 1995. Actual results may differ from those set forth in this press release due to certain risks and uncertainties, including market acceptance of new product offerings and continued demand for existing products. Among other things, these results may not continue beyond the current quarter due to seasonal and economic trends and additional competitive issues that may have an adverse effect on the ongoing positioning and growth of the Company. These and other risks are detailed from time to time in reports filed with the SEC, including its quarterly reports on Form 10-Q and its annual report on Form 10-K.
Trimble is a leading innovator of Global Positioning System (GPS) technology. In addition to providing advanced GPS components, Trimble augments GPS with other positioning technologies, as well as wireless communications and software, to create complete customer solutions. Trimble's worldwide presence and unique capabilities position the Company for growth in emerging applications including surveying, automobile navigation, machine guidance, asset tracking, wireless platforms, and telecommunications infrastructure. Founded in 1978 and headquartered in Sunnyvale, Calif., Trimble has more than 2,000 employees in more than 20 countries worldwide.
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Media Contact: LeaAnn McNabb, 408-481-7808.