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Trimble Navigation Limited
935 Stewart Drive
Post Office Box 3642
Sunnyvale, CA 94085
1.408.481.8000 phone
1.408.481.7781 fax

  NEWS RELEASE

 

Trimble Third Quarter 2010 Revenue $318.2 Million, Up 18 Percent;
Non-GAAP EPS $0.39, Up 56 Percent

SUNNYVALE, Calif., Nov. 2, 2010 /PRNewswire via COMTEX News Network/ -- Trimble (Nasdaq: TRMB) today announced revenue of $318.2 million for its third quarter ended Oct. 1, 2010, up approximately 18 percent as compared to revenue of $269.7 million in the third quarter of 2009.

Operating income for the third quarter of 2010 was $31.7 million, up approximately 57 percent as compared to the third quarter of 2009. Operating margin in the third quarter of 2010 was 10.0 percent, as compared to an operating margin of 7.5 percent in the third quarter of 2009.

Amortization of intangibles was $14.4 million in the third quarter of 2010, as compared to $13.6 million in the third quarter of 2009. The impact of stock-based compensation expense was $5.5 million, as compared to $4.5 million in the third quarter of 2009. There was also $290 thousand of restructuring expense, a $69 thousand acquisition-related inventory step-up charge, and $2.5 million of non-recurring acquisition-related net gains in the third quarter of 2010. In the third quarter of 2009 there was a $1.1 million restructuring expense, no acquisition-related inventory step-up charge, and $577 thousand of non-recurring acquisition costs.

Excluding these items, third quarter 2010 non-GAAP operating income of $52.6 million was up 31 percent, as compared to the third quarter of 2009. Non-GAAP operating margin was 16.5 percent in the third quarter of 2010, as compared to 14.8 percent in the third quarter of 2009.

Third quarter 2010 net income was $32.8 million, up 111 percent, as compared to the third quarter of 2009. Diluted earnings per share for the third quarter of 2010 were $0.27, as compared to diluted earnings per share of $0.13 for the third quarter of 2009. The tax rate for the third quarter of 2010 was 14 percent as compared to 27 percent in the third quarter of 2009. The tax rate is lower primarily due to a previously announced settlement with the IRS and the geographical mix of pre-tax income.

Adjusting for the items noted above, non-GAAP net income of $48.2 million for the third quarter of 2010 was up 60 percent, as compared to the third quarter of 2009. Diluted non-GAAP earnings per share for the third quarter of 2010 were $0.39, as compared to diluted non-GAAP earnings per share of $0.25 in the third quarter of 2009.

"Trimble continues to see recovery in most of its markets, most particularly agriculture. We continue to work the issues in our Mobile Solutions segment and have established an improving trend which should continue into 2011," said Steven W. Berglund, Trimble's president and chief executive officer. "In spite of still uncertain economic conditions, we currently expect strengthening results for the total company in 2011."

Trimble Results by Business Segment

Segment operating income is revenue less cost of goods sold and operating expenses, excluding general corporate expenses, restructuring expenses, amortization of intangibles, amortization of acquisition-related inventory step-up charges, non-recurring acquisition costs, and the impact of stock-based compensation expense.

Engineering and Construction (E&C)

Third quarter 2010 E&C revenue was $189.6 million, up approximately 27 percent as compared to the third quarter of 2009, with strength across most product lines and geographies.

Operating income in E&C for the third quarter 2010 was $36.6 million, or 19.3 percent of revenue, as compared to $21.1 million, or 14.1 percent of revenue, in the third quarter of 2009. Non-GAAP operating income was $38.5 million, or 20.3 percent of revenue, as compared to $22.7 million, or 15.2 percent of revenue, in the third quarter of 2009. The improvement in non-GAAP operating margin was due to operating leverage from increased revenue.

Field Solutions

Third quarter 2010 Field Solutions revenue was $67.2 million, up 21 percent as compared to the third quarter of 2009. Sales of agricultural products were strong, driven by new product introductions and a better macro environment in agriculture. Geographic Information System (GIS) product sales were also up.

Operating income in Field Solutions for the third quarter 2010 was $21.0 million, or 31.3 percent of revenue, as compared to $16.3 million, or 29.3 percent of revenue, in the third quarter of 2009. Non-GAAP operating income was $21.5 million, or 32.0 percent of revenue, as compared to $16.6 million, or 29.8 percent of revenue, in the third quarter of 2009. The increase in operating margin was due to product mix and higher revenue.

Mobile Solutions

Third quarter 2010 Mobile Solutions revenue was $37.7 million, down 5 percent as compared to the third quarter of 2009 primarily due to the loss of a large customer in the second quarter partially offset by the acquisition of Punch Telematics.

Operating loss in Mobile Solutions for the third quarter 2010 was $83 thousand, or negative 0.2 percent of revenue, as compared to operating income of $3.4 million, or 8.5 percent of revenue, in the third quarter of 2009. Non-GAAP operating income was $744 thousand, or 2.0 percent of revenue, as compared to $4.3 million or 10.9 percent of revenue, in the third quarter of 2009. The decline in non-GAAP margins is due to lower revenue and product mix.

Advanced Devices

Third quarter 2010 Advanced Devices revenue was $23.7 million, down approximately 6 percent as compared to the third quarter of 2009 due to slower sales of embedded products.

Operating income in Advanced Devices for the third quarter 2010 was $4.1 million, or 17.2 percent of revenue, as compared to $4.5 million, or 17.9 percent of revenue, in the third quarter of 2009. Non-GAAP operating income in Advanced Devices was $4.5 million, or 19.1 percent of revenue, as compared to $4.9 million, or 19.5 percent of revenue, in the third quarter of 2009.

Stock Repurchase Program

Trimble repurchased $6.1 million in stock at an average price of $28.40 during the third quarter of 2010.

Use of Non-GAAP Financial Information

To help our readers understand our past financial performance and our future results, we supplement the financial results that we provide in accordance with generally accepted accounting principles, or GAAP, with non-GAAP financial measures. The specific non-GAAP measures which we use along with a reconciliation to the nearest comparable GAAP measures and the explanation for why management chose to exclude selected items and the additional purposes for which these non-GAAP measures are used can be found at the end of this release. The method we use to produce non-GAAP results is not computed according to GAAP and may differ from the methods used by other companies. Our non-GAAP results are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. Our management regularly uses our supplemental non-GAAP financial measures internally to understand, manage and evaluate our business, and to make operating decisions. These non-GAAP measures are among the primary factors management uses in planning for and forecasting future periods. We believe that these non-GAAP financial measures reflect an additional way of viewing aspects of our operations that, when viewed with our GAAP results, provide a more complete understanding of factors and trends affecting our business. Management generally compensates for the limitations in the use of non-GAAP financial measures by relying on comparable GAAP financial measures and providing investors with a reconciliation of the non-GAAP financial measure to the most directly comparable GAAP financial measure or measures. Investors are encouraged to review the reconciliation of our non-GAAP financial measures to the comparable GAAP results, which is attached to this earnings release. Additional financial information about our use of non-GAAP results can be found on the investor relations page of our Web site at http://investor.trimble.com.

Forward Looking Guidance

For the fourth quarter of 2010 Trimble expects revenue between $313 million and $318 million, representing a year over year growth rate of 13 to 15 percent, with GAAP earnings per share of $0.18 to $0.20 and non-GAAP earnings per share of $0.33 to $0.35. Non-GAAP guidance for the fourth quarter of 2010 excludes the amortization of intangibles of $14.6 million related to previous acquisitions, the anticipated impact of stock-based compensation expense of $6.5 million, and expected acquisition costs of $1.6 million. Both GAAP and non-GAAP earnings per share assume an 18 to 20 percent tax rate and 124.2 million shares outstanding.

Investor Conference Call / Webcast Details

Trimble will hold a conference call on Nov. 2, 2010 at 1:30 p.m. PT to review its third quarter 2010 results. It will be broadcast live on the Web at http://investor.trimble.com. Investors without Internet access may dial into the call at (800) 528-9198 (U.S.) or (702) 928-6633 (international). A replay of the call will be available for seven days at (800) 642-1687 (U.S.) or (706) 645-9291 (international) and the pass code is 20117040. The replay will also be available on the Web at the address above.

About Trimble

Trimble applies technology to make field and mobile workers in businesses and government significantly more productive. Solutions are focused on applications requiring position or location--including surveying, construction, agriculture, fleet and asset management, public safety and mapping. In addition to utilizing positioning technologies, such as GPS, lasers and optics, Trimble solutions may include software content specific to the needs of the user. Wireless technologies are utilized to deliver the solution to the user and to ensure a tight coupling of the field and the back office. Founded in 1978, Trimble is headquartered in Sunnyvale, Calif.

For more information visit www.trimble.com.

Safe Harbor

Certain statements made in this press release are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and are made pursuant to the safe harbor provisions of the Securities Litigation Reform Act of 1995. These statements include expectations for future financial market and economic conditions, the ability to deliver revenue, earnings per share that Trimble has guided for the Fourth quarter and full year 2010 and 2011, the expected tax-rate, the anticipated impact of stock-based compensation expense, the amortization of intangibles related to previous acquisitions. The Company may suspend its stock repurchase plan at any time and for any reason without further notice. These forward-looking statements are subject to change, and actual results may materially differ from those set forth in this press release due to certain risks and uncertainties. If the current economic conditions worsen it may negatively impact our customers' purchasing decisions worldwide, including in emerging markets. In addition, the Company's results may be adversely affected if the Company is unable to market, manufacture and ship new products or obtain new customers for its mobile solutions segment. Any weakening of our accounts receivable or write-off of goodwill could also impair our financial results. Any failure to achieve predicted results could negatively impact the Company's revenues, cash flow from operations, and other financial results. The Company's financial results will also depend on a number of other factors, including the risks 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. Undue reliance should not be placed on any forward-looking statement contained herein, especially in light of greater uncertainty than normal in the economy in general. These statements reflect the Company's position as of the date of this release. The Company expressly disclaims any undertaking to release publicly any updates or revisions to any statements to reflect any change in the Company's expectations or any change of events, conditions, or circumstances on which any such statement is based.

FTRMB

                           CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                              (In thousands, except per share data)
                                           (Unaudited)

                                                     Three Months Ended
                                                     ------------------

                                                   Oct-1,         Oct-2,
                                                      2010           2009
                                                      ----           ----

    Revenue                                       $318,210       $269,713
    Cost of sales                                  158,462        137,255
                                                   -------        -------
    Gross margin                                   159,748        132,458
                                                   -------        -------
    Gross margin (%)                                  50.2%          49.1%

    Operating expenses
        Research and development                    36,897         33,250
        Sales and marketing                         53,228         47,022
        General and administrative                  29,637         23,237
        Restructuring                                  238            872
        Amortization of purchased intangible
         assets                                      8,078          7,912
           Total operating expenses                128,078        112,293
                                                   -------        -------


    Operating income                                31,670         20,165

    Non-operating income, net
        Interest income                                221            124
        Interest expense                              (576)          (450)
        Foreign currency transaction gain (loss),
         net                                            77            792
        Income (loss) from equity method
         investments, net                            3,404            (58)
        Other income, net                            3,533            988
           Total non-operating income, net           6,659          1,396
                                                     -----          -----

    Income before taxes                             38,329         21,561

    Income tax provision                             5,487          5,714
    Net income                                      32,842         15,847
      Less: Net income (loss) attributable to
       noncontrolling interests                         (3)           270
    Net income attributable to Trimble
     Navigation Ltd.                               $32,845        $15,577
                                                   =======        =======

    Earnings per share attributable to
     Trimble Navigation Ltd.
         Basic                                       $0.27          $0.13
                                                     -----          -----
         Diluted                                     $0.27          $0.13
                                                     -----          -----

    Shares used in calculating earnings per
     share:
        Basic                                      119,474        120,047
        Diluted                                    122,869        122,854
                                                   -------        -------



                                                      Nine Months Ended
                                                      -----------------

                                                   Oct-1,         Oct-2,
                                                      2010           2009
                                                      ----           ----

    Revenue                                       $970,588       $848,730
    Cost of sales                                  488,417        429,514
                                                   -------        -------
    Gross margin                                   482,171        419,216
                                                   -------        -------
    Gross margin (%)                                  49.7%          49.4%

    Operating expenses
        Research and development                   109,339        100,844
        Sales and marketing                        153,518        141,120
        General and administrative                  85,474         75,901
        Restructuring                                1,244          5,797
        Amortization of purchased intangible
         assets                                     24,250         22,411
           Total operating expenses                373,825        346,073
                                                   -------        -------


    Operating income                               108,346         73,143

    Non-operating income, net
        Interest income                                864            546
        Interest expense                            (1,385)        (1,408)
        Foreign currency transaction gain (loss),
         net                                        (1,046)           760
        Income (loss) from equity method
         investments, net                            9,025            421
        Other income, net                            3,022          1,476
           Total non-operating income, net          10,480          1,795
                                                    ------          -----

    Income before taxes                            118,826         74,938

    Income tax provision                            51,061         20,244
    Net income                                      67,765         54,694
      Less: Net income (loss) attributable to
       noncontrolling interests                        669            795
    Net income attributable to Trimble
     Navigation Ltd.                               $67,096        $53,899
                                                   =======        =======

    Earnings per share attributable to
     Trimble Navigation Ltd.
         Basic                                       $0.56          $0.45
                                                     -----          -----
         Diluted                                     $0.54          $0.44
                                                     -----          -----

    Shares used in calculating earnings per
     share:
        Basic                                      120,296        119,620
        Diluted                                    123,599        121,893
                                                   -------        -------


                  CONDENSED CONSOLIDATED BALANCE SHEETS
                              (In thousands)
                               (Unaudited)




                                                    Oct-1,          Jan-1
                                                        2010           2010
                                                        ----           ----
    Assets

    Current assets:
       Cash and cash equivalents                    $211,056       $273,848
       Accounts receivables, net                     229,746        202,293
       Other receivables                              18,172         11,856
       Inventories, net                              176,853        144,012
       Deferred income taxes                          29,600         39,686
       Other current assets                           20,673         18,383
                                                      ------         ------
          Total current assets                       686,100        690,078

    Property and equipment, net                       49,525         44,635
    Goodwill                                         812,564        764,193
    Other purchased intangible assets, net           203,230        202,782
    Other non-current assets                          64,661         51,589
                                                      ------         ------

          Total assets                            $1,816,080     $1,753,277
                                                  ==========     ==========

    Liabilities

    Current liabilities:
       Current portion of long-term debt              $1,913           $445
       Accounts payable                               73,064         53,775
       Accrued compensation and benefits              60,908         43,272
       Deferred revenue                               74,392         68,968
       Accrued warranty expense                       13,802         14,744
       Other accrued liabilities                      38,187         42,041
                                                      ------         ------
          Total current liabilities                  262,266        223,245

    Non-current portion of long-term debt            151,180        151,038
    Non-current deferred revenue                      12,606         15,599
    Deferred income taxes                             29,388         38,857
    Other non-current liabilities                     41,313         59,983
          Total liabilities                          496,753        488,722
                                                     -------        -------

    Commitments and contingencies

    Equity

    Shareholders' equity:
       Common stock                                  754,664        720,248
       Retained earnings                             500,407        491,367
       Accumulated other comprehensive income         50,689         48,297
                                                      ------         ------
    Total Trimble Navigation Ltd.
     shareholders' equity                          1,305,760      1,259,912
    Noncontrolling interests                          13,567          4,643
          Total equity                             1,319,327      1,264,555

          Total liabilities and equity            $1,816,080     $1,753,277
                                                  ==========     ==========


            CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (In thousands)
                              (Unaudited)

                                                    Nine Months Ended
                                                    Oct-1,         Oct-2,
                                                        2010          2009
                                                        ----          ----

    Cash flow from operating activities:
        Net Income                                   $67,765       $54,694

        Adjustments to reconcile net income  to
         net cash provided by
           operating activities:
             Depreciation expense                     13,310        13,941
             Amortization expense                     42,165        38,968
             Provision for doubtful accounts           3,022         2,933
             Amortization of debt issuance cost          169           169
             Deferred income taxes                    (3,827)       (9,268)
             Stock-based compensation                 16,165        13,321
             Income from equity method investments    (9,025)         (421)
             Excess tax benefit for stock-based
              compensation                            (1,971)       (1,304)
             Provision for excess and obsolete
              inventories                              3,573         2,943
             Other non-cash items                     (3,799)       (2,876)

        Add decrease (increase) in assets:
             Accounts receivables                    (17,030)        2,613
             Other receivables                           191         6,288
             Inventories                             (32,549)        1,300
             Other current and non-current assets        366         1,915

        Add increase (decrease) in liabilities:
             Accounts payable                         15,796        (1,068)
             Accrued compensation and benefits        15,780         2,273
             Accrued liabilities                     (25,051)        1,947
             Deferred revenue                          1,982        10,753
     Net cash provided by operating activities        87,032       139,121
                                                      ------       -------

     Cash flow from investing activities:
          Acquisitions of businesses, net of cash
           acquired                                  (90,757)     (50,824)
          Acquisition of property and equipment      (17,162)       (9,541)
          Acquisitions of intangible assets             (625)     (26,839)
          Purchases of equity method investments      (5,692)            -
          Net purchases of short term investments          -        (2,000)
          Dividends received                           5,000         2,896
          Other                                           99          (379)
                                                         ---
     Net cash used in investing activities          (109,137)     (86,687)
                                                    --------       -------

     Cash flow from financing activities:
          Issuance of common stock                    31,901        13,673
          Repurchase and retirement of common stock  (73,853)            -
          Excess tax benefit for stock-based
           compensation                                1,971         1,304
          Payments on long-term debt and revolving
           credit lines                                 (467)         (168)
          Tax withholding on restricted stock            (16)            -
     Net cash provided by (used in) financing
      activities                                     (40,464)       14,809
                                                     -------        ------

     Effect of exchange rate changes on cash
      and cash equivalents                              (223)        5,325
                                                        ----         -----

     Net increase (decrease) in cash and cash
      equivalents                                    (62,792)       72,568
     Cash and cash equivalents -beginning of
      period                                         273,848       142,531
                                                     -------       -------

     Cash and cash equivalents -end of period       $211,056      $215,099
                                                    ========      ========


                                      REPORTING SEGMENTS
                                    (Dollars in thousands)
                                          (Unaudited)



                                                    Reporting Segments
                                                    ------------------
                                                Engineering
                                                     and             Field
                                                Construction      Solutions
                                                ------------      ---------

    THREE MONTHS ENDED OCTOBER 1, 2010:
      Revenue                                       $189,598         $67,240

      Operating income (loss) before
       corporate allocations:                        $36,589         $21,027
        Operating margin (% of segment
         external net revenues)                         19.3%           31.3%

    THREE MONTHS ENDED OCTOBER 2, 2009:
      Revenue                                       $149,384         $55,654

      Operating income before corporate
       allocations:                                  $21,131         $16,286
        Operating margin (% of segment
         external net revenues)                         14.1%           29.3%

    NINE MONTHS ENDED OCTOBER 1, 2010:
      Revenue                                       $535,657        $243,299

      Operating income before corporate
       allocations:                                  $89,317         $89,320
        Operating margin (% of segment
         external net revenues)                         16.7%           36.7%

    NINE MONTHS ENDED OCTOBER 2, 2009:
      Revenue                                       $424,275        $234,598

      Operating income before corporate
       allocations:                                  $42,800         $88,637
        Operating margin (% of segment
         external net revenues)                         10.1%           37.8%


                                               Reporting Segments
                                               ------------------

                                                 Mobile       Advanced
                                               Solutions      Devices
                                               ---------      -------

    THREE MONTHS ENDED OCTOBER 1, 2010:
      Revenue                                    $37,692       $23,680

      Operating income (loss) before
       corporate allocations:                       $(83)       $4,073
        Operating margin (% of segment
         external net revenues)                    (0.2%)         17.2%

    THREE MONTHS ENDED OCTOBER 2, 2009:
      Revenue                                    $39,572       $25,103

      Operating income before corporate
       allocations:                               $3,367        $4,488
        Operating margin (% of segment
         external net revenues)                      8.5%         17.9%

    NINE MONTHS ENDED OCTOBER 1, 2010:
      Revenue                                   $113,839       $77,793

      Operating income before corporate
       allocations:                               $2,140       $14,879
        Operating margin (% of segment
         external net revenues)                      1.9%         19.1%

    NINE MONTHS ENDED OCTOBER 2, 2009:
      Revenue                                   $116,925       $72,932

      Operating income before corporate
       allocations:                              $10,163       $13,633
        Operating margin (% of segment
         external net revenues)                      8.7%         18.7%


            GAAP TO NON-GAAP RECONCILIATION
     (Dollars in thousands, except per share data)
                      (Unaudited)


                                               Three Months Ended
                                               ------------------
                                             Oct-1,                Oct-2,

                                                     2010                2009
                                                     ----                ----
                                        Dollar     % of     Dollar     % of
                                        Amount   Revenue    Amount   Revenue
                                        ------   -------    ------   -------
    GROSS MARGIN:
      GAAP gross margin:               $159,748      50.2% $132,458      49.1%
        Restructuring      ( A )             52       0.0%      270       0.1%
        Amortization of
         purchased
         intangibles       ( B )          6,356       2.0%    5,661       2.1%
        Stock-based
         compensation      ( C )            485       0.2%      453       0.2%
        Amortization of
         acquisition-
         related inventory
         step-up           ( D )             69       0.0%        -       0.0%
                                            ---       ---       ---       ---
      Non-GAAP gross
       margin:                         $166,710      52.4% $138,842      51.5%
                                       --------      ----  --------      ----

    OPERATING EXPENSES:
      GAAP operating
       expenses:                       $128,078      40.3% $112,293      41.6%
        Restructuring      ( A )           (238)     -0.1%     (872)     -0.3%
        Amortization of
         purchased
         intangibles       ( B )         (8,078)     -2.5%   (7,912)     -3.0%
        Stock-based
         compensation      ( C )         (5,055)     -1.6%   (4,088)     -1.5%
        Non-recurring
         acquisition costs ( E )           (569)     -0.2%     (577)     -0.2%
                                           ----      ----      ----      ----
      Non-GAAP operating
       expenses:                       $114,138      35.9%  $98,844      36.6%
                                       --------      ----   -------      ----

    OPERATING INCOME:
      GAAP operating
       income:                          $31,670      10.0%  $20,165       7.5%
        Restructuring      ( A )            290       0.1%    1,142       0.4%
        Amortization of
         purchased
         intangibles       ( B )         14,434       4.5%   13,573       5.0%
        Stock-based
         compensation      ( C )          5,540       1.7%    4,541       1.7%
        Amortization of
         acquisition-
         related inventory
         step-up           ( D )             69       0.0%        -       0.0%
        Non-recurring
         acquisition costs ( E )            569       0.2%      577       0.2%
                                            ---       ---       ---       ---
      Non-GAAP operating
       income:                          $52,572      16.5%  $39,998      14.8%
                                        -------      ----   -------      ----

    NON-OPERATING
     INCOME, NET:
      GAAP non-operating
       income, net:                      $6,659              $1,396
        Non-recurring
         acquisition
         (gains) costs     ( E )         (3,022)                  -
                                         ------                 ---
      Non-GAAP non-
       operating income,
       net:                              $3,637              $1,396
                                         ------              ------

    NET INCOME:
      GAAP net income
       attributable to
       Trimble Navigation
       Ltd.                             $32,845             $15,577
        Restructuring      ( A )            290               1,142
        Amortization of
         purchased
         intangibles       ( B )         14,434              13,573
        Stock-based
         compensation      ( C )          5,540               4,541
        Amortization of
         acquisition-
         related inventory
         step-up           ( D )             69                   -
        Non-recurring
         acquisition
         (gains) costs     ( E )         (2,453)                577
        Income tax effect
         on non-GAAP
         adjustments       ( F )         (2,560)             (5,256)
                                         ------              ------
      Non-GAAP net
       income
       attributable to
       Trimble Navigation
       Ltd.                    $48,165      $30,154
                                        -------             -------

    DILUTED NET INCOME
     PER SHARE:
      GAAP diluted net
       income per share
       attributable to
       Trimble Navigation
       Ltd.                      $0.27        $0.13
        Restructuring      ( A )              -                0.01
        Amortization of
         purchased
         intangibles       ( B )           0.12                0.11
        Stock-based
         compensation      ( C )           0.04                0.04
        Amortization of
         acquisition-
         related inventory
         step-up           ( D )              -                   -
        Non-recurring
         acquisition
         (gains) costs     ( E )          (0.02)                  -
        Income tax effect
         on non-GAAP
         adjustments       ( F )          (0.02)              (0.04)
                                          -----               -----
      Non-GAAP diluted
       net income per
       share attributable
       to Trimble
       Navigation Ltd.           $0.39        $0.25
                                          -----               -----

    OPERATING LEVERAGE:
      Increase in non-
       GAAP operating
       income                           $12,574
      Increase in revenue               $48,497
      Operating leverage
       (increase in non-
       GAAP operating
      income as a % of
       increase in
       revenue)                            25.9%

                                                   % of                 % of
                                                  Segment             Segment
    SEGMENT OPERATING
     INCOME:                                     Revenue             Revenue
                                                 -------             -------
      Engineering and
       Construction
        GAAP operating
         income before
         corporate
         allocations:                   $36,589      19.3%  $21,131      14.1%
          Stock-based
           compensation    ( G )          1,891       1.0%    1,563       1.1%
        Non-GAAP operating
         income before
         corporate
         allocations:                   $38,480      20.3%  $22,694      15.2%
                                        -------      ----   -------      ----

      Field Solutions
        GAAP operating
         income before
         corporate
         allocations:                   $21,027      31.3%  $16,286      29.3%
          Stock-based
           compensation    ( G )            464       0.7%      293       0.5%
        Non-GAAP operating
         income before
         corporate
         allocations:                   $21,491      32.0%  $16,579      29.8%
                                        -------      ----   -------      ----

      Mobile Solutions
        GAAP operating
         income (loss)
         before corporate
         allocations:                      $(83)     -0.2%   $3,367       8.5%
          Stock-based
           compensation    ( G )            827       2.2%      958       2.4%
        Non-GAAP operating
         income before
         corporate
         allocations:                      $744       2.0%   $4,325      10.9%
                                           ----       ---    ------      ----

      Advanced Devices
        GAAP operating
         income before
         corporate
         allocations:                    $4,073      17.2%   $4,488      17.9%
          Stock-based
           compensation    ( G )            450       1.9%      397       1.6%
        Non-GAAP operating
         income before
         corporate
         allocations:                    $4,523      19.1%   $4,885      19.5%
                                         ------      ----    ------      ----



                                                Nine Months Ended
                                                -----------------
                                              Oct-1,               Oct-02,

                                                     2010                2009
                                                     ----                ----
                                        Dollar     % of     Dollar     % of
                                        Amount   Revenue    Amount   Revenue
                                        ------   -------    ------   -------
    GROSS MARGIN:
      GAAP gross margin:               $482,171      49.7% $419,216      49.4%
        Restructuring      ( A )            150       0.0%    3,333       0.4%
        Amortization of
         purchased
         intangibles       ( B )         17,915       1.8%   16,421       1.9%
        Stock-based
         compensation      ( C )          1,472       0.2%    1,368       0.2%
        Amortization of
         acquisition-
         related inventory
         step-up           ( D )            140       0.0%      470       0.0%
                                            ---       ---       ---       ---
      Non-GAAP gross
       margin:                         $501,848      51.7% $440,808      51.9%
                                       --------      ----  --------      ----

    OPERATING EXPENSES:
      GAAP operating
       expenses:                       $373,825      38.5% $346,073      40.8%
        Restructuring      ( A )         (1,244)     -0.1%   (5,797)     -0.7%
        Amortization of
         purchased
         intangibles       ( B )        (24,250)     -2.5%  (22,411)     -2.7%
        Stock-based
         compensation      ( C )        (14,693)     -1.5%  (11,953)     -1.4%
        Non-recurring
         acquisition costs ( E )         (3,071)     -0.3%   (3,382)     -0.4%
                                         ------      ----    ------      ----
      Non-GAAP operating
       expenses:                       $330,567      34.1% $302,530      35.6%
                                       --------      ----  --------      ----

    OPERATING INCOME:
      GAAP operating
       income:                         $108,346      11.2%  $73,143       8.6%
        Restructuring      ( A )          1,394       0.1%    9,130       1.1%
        Amortization of
         purchased
         intangibles       ( B )         42,165       4.3%   38,832       4.6%
        Stock-based
         compensation      ( C )         16,165       1.7%   13,321       1.6%
        Amortization of
         acquisition-
         related inventory
         step-up           ( D )            140       0.0%      470       0.0%
        Non-recurring
         acquisition costs ( E )          3,071       0.3%    3,382       0.4%
                                          -----       ---     -----       ---
      Non-GAAP operating
       income:                         $171,281      17.6% $138,278      16.3%
                                       --------      ----  --------      ----

    NON-OPERATING
     INCOME, NET:
      GAAP non-operating
       income, net:                     $10,480              $1,795
        Non-recurring
         acquisition
         (gains) costs     ( E )         (3,212)               (386)
                                         ------                ----
      Non-GAAP non-
       operating income,
       net:                              $7,268              $1,409
                                         ------              ------

    NET INCOME:
      GAAP net income
       attributable to
       Trimble Navigation
       Ltd.                             $67,096             $53,899
        Restructuring      ( A )          1,394               9,130
        Amortization of
         purchased
         intangibles       ( B )         42,165              38,832
        Stock-based
         compensation      ( C )         16,165              13,321
        Amortization of
         acquisition-
         related inventory
         step-up           ( D )            140                 470
        Non-recurring
         acquisition
         (gains) costs     ( E )           (141)              2,996
        Income tax effect
         on non-GAAP
         adjustments       ( F )         15,591             (17,411)
                                         ------             -------
      Non-GAAP net
       income
       attributable to
       Trimble Navigation
       Ltd.                   $142,410     $101,237
                                       --------            --------

    DILUTED NET INCOME
     PER SHARE:
      GAAP diluted net
       income per share
       attributable to
       Trimble Navigation
       Ltd.                      $0.54        $0.44
        Restructuring      ( A )           0.01                0.07
        Amortization of
         purchased
         intangibles       ( B )           0.34                0.32
        Stock-based
         compensation      ( C )           0.13                0.11
        Amortization of
         acquisition-
         related inventory
         step-up           ( D )              -                   -
        Non-recurring
         acquisition
         (gains) costs     ( E )              -                0.03
        Income tax effect
         on non-GAAP
         adjustments       ( F )           0.13               (0.14)
                                           ----               -----
      Non-GAAP diluted
       net income per
       share attributable
       to Trimble
       Navigation Ltd.           $1.15        $0.83
                                          -----               -----

    OPERATING LEVERAGE:
      Increase in non-
       GAAP operating
       income                           $33,003
      Increase in revenue              $121,858
      Operating leverage
       (increase in non-
       GAAP operating
      income as a % of
       increase in
       revenue)                            27.1%

                                                    % of                % of
                                                  Segment             Segment
    SEGMENT OPERATING
     INCOME:                                     Revenue             Revenue
                                                 -------             -------
      Engineering and
       Construction
        GAAP operating
         income before
         corporate
         allocations:                   $89,317      16.7%  $42,800      10.1%
          Stock-based
           compensation    ( G )          5,494       1.0%    4,302       1.0%
        Non-GAAP operating
         income before
         corporate
         allocations:                   $94,811      17.7%  $47,102      11.1%
                                        -------      ----   -------      ----

      Field Solutions
        GAAP operating
         income before
         corporate
         allocations:                   $89,320      36.7%  $88,637      37.8%
          Stock-based
           compensation    ( G )          1,397       0.6%      775       0.3%
        Non-GAAP operating
         income before
         corporate
         allocations:                   $90,717      37.3%  $89,412      38.1%
                                        -------      ----   -------      ----

      Mobile Solutions
        GAAP operating
         income (loss)
         before corporate
         allocations:                    $2,140       1.9%  $10,163       8.7%
          Stock-based
           compensation    ( G )          2,246       2.0%    3,205       2.7%
        Non-GAAP operating
         income before
         corporate
         allocations:                    $4,386       3.9%  $13,368      11.4%
                                         ------       ---   -------      ----

      Advanced Devices
        GAAP operating
         income before
         corporate
         allocations:                   $14,879      19.1%  $13,633      18.7%
          Stock-based
           compensation    ( G )          1,350       1.8%    1,068       1.5%
        Non-GAAP operating
         income before
         corporate
         allocations:                   $16,229      20.9%  $14,701      20.2%
                                        -------      ----   -------      ----


                    FOOTNOTES TO GAAP TO NON-GAAP RECONCILIATION

                                     (Unaudited)

    The non-GAAP financial measures included in the previous table are
    non-GAAP gross margin, non-GAAP operating expenses, non-GAAP
    operating income, non-GAAP non-operating income, net, non-GAAP
    net income, non-GAAP diluted net income per share and operating
    leverage, and non-GAAP segment operating income before corporate
    allocations.    These non-GAAP measures can be used to evaluate the
    Company's historical and prospective financial performance, as well
    as its performance relative to competitors.  The Company believes
    some of its investors track the Company's "core operating
    performance" as a means of evaluating the Company's performance in
    the ordinary, ongoing, and customary course of its operations.
    Management also believes that looking at its core operating
    performance provides a supplemental way to provide consistency in
    period to period comparisons.  Accordingly, management excludes from
    non-GAAP those items relating to restructuring, amortization of
    purchased intangibles, stock based compensation, amortization of
    acquisition-related inventory step-up,  non-recurring acquisition
    costs, and a $27.5 million charge associated with the IRS
    settlement, which the Company believes are not indicative of its
    core operating performance

    ( A )  Restructuring. Included in our GAAP presentation of cost of sales
           and
           operating expenses, restructuring costs recorded are primarily for
           employee compensation resulting from reductions in employee
           headcount in connection with our company restructurings.  We
           exclude
           restructuring from our non-GAAP measures because we believe it is
           not indicative of our core operating performance.

    ( B )  Amortization of purchased intangibles.  Included in our GAAP
           presentation of cost of sales and operating expenses, amortization
           of purchased intangibles recorded arise from prior acquisitions and
           are non-cash in nature.  We exclude these expenses from our non-
           GAAP measures because we believe they are not indicative of our
           core operating performance.

    ( C )  Stock-based compensation. Included in our GAAP presentation of cost
           of sales and operating expenses, stock-based compensation consists
           of expenses for employee stock options and awards and purchase
           rights under our employee stock purchase plan.  We exclude stock-
           based compensation expense from our non-GAAP measures because some
           investors may view it as not reflective of our core operating
           performance as it is a non-cash expense.   For the three months and
           nine months ended October 1, 2010 and October 2, 2009, stock-based
           compensation was allocated as follows:

                              Three Months Ended     Nine Months Ended
                              ------------------     -----------------
                            Oct-1,       Oct-2,  Oct-1,       Oct-2,
     (Dollars in thousands)    2010         2009    2010         2009
                               ----         ----    ----         ----
     Cost of sales             $485         $453  $1,472       $1,368
     Research and
      development               968          866   2,899        2,504
     Sales and Marketing      1,283        1,134   4,013        3,200
     General and
      administrative          2,804        2,088   7,781        6,249
                             $5,540       $4,541 $16,165      $13,321
                             ------       ------ -------      -------

    ( D ) Amortization of acquisition-related inventory step-up.  The
          purchase accounting entries associated with our business
          acquisitions require us to record inventory at its fair value, which
          is sometimes greater than the previous book value of the inventory.
          Included in our GAAP presentation of cost of sales, the increase in
          inventory value is amortized to cost of sales over the period that
          the related product is sold.  We exclude inventory step-up
          amortization from our non-GAAP measures because we do not believe
          it is indicative of our core operating performance.

    ( E ) Non-recurring acquisition (gains) costs.  Included in our GAAP
          presentation of operating expenses and non-operating income, net,
          non-recurring acquisition costs consist of external and incremental
          costs resulting directly from merger and acquisition activities such
          as legal, due diligence and integration costs.  Also included are
          unusual acquisition related items such as a gain on bargain purchase
          (resulting from the fair value of identifiable net assets acquired
          exceeding the consideration transferred), adjustments to the fair
          value of earnout liabilities and payments made or received to settle
          earnout and holdback disputes.  We exclude these items because they
          are non-recurring and unique to specific acquisitions and are not
          indicative of our core operating performance.

    ( F ) Income tax effect on non-GAAP adjustments. This amount adjusts the
          provision for income taxes to reflect the effect of the non-GAAP
          adjustments on non-GAAP net income.   In addition, the nine months
          ended October 1, 2010 include the net impact of the $27.5 million
          associated with the IRS audit settlement.

    ( G ) Stock-based Compensation. The amounts consist of expenses for
          employee stock options and awards and purchase rights under our
          employee stock purchase plan. As referred to above we exclude stock-
          based compensation here because investors may view it as not
          reflective of our core operating performance.  However, management
          does include stock-based compensation for budgeting and incentive
          plans as well as for reviewing internal financial reporting. We
          discuss our operating results by segment with and without stock-
          based compensation expense, as we believe it is useful to investors.
          Stock-based compensation not allocated to the reportable segments
          was approximately $1.9 million and $1.3 million for the three
          months
          ended October 1, 2010 and October 2, 2009, respectively and $5.7
          million and $4.0 million for the nine months ended October 1, 2010
          and October 2, 2009, respectively.





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