-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, JwhSbxj6mmPkmHEFzZbRbi7h3OMvYgba8ms4IbILKGQbuRYU6wBpxFgnmjY1BTMM iTJp8yG/vqTdIAmKyCL4ZQ== 0001121788-03-000002.txt : 20030212 0001121788-03-000002.hdr.sgml : 20030212 20030212121319 ACCESSION NUMBER: 0001121788-03-000002 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20030212 ITEM INFORMATION: FILED AS OF DATE: 20030212 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GARMIN LTD CENTRAL INDEX KEY: 0001121788 STANDARD INDUSTRIAL CLASSIFICATION: SEARCH, DETECTION, NAVIGATION, GUIDANCE, AERONAUTICAL SYS [3812] IRS NUMBER: 980229227 FISCAL YEAR END: 1230 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-31983 FILM NUMBER: 03553166 BUSINESS ADDRESS: STREET 1: PO BOX 309 UGLAND HOUSE STREET 2: SOUTH CHURCH ST GEORGETOWN CITY: GRAND CAYMAN BUSINESS PHONE: 9133978200 MAIL ADDRESS: STREET 1: C/O GARMIN INTERNATIONAL INC STREET 2: 1200 E 151ST STREET CITY: OLATHE STATE: KS ZIP: 66062 8-K 1 form8k_021203.txt SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 8-K Current Report Pursuant to Section 13 or 15(d) of the Securities Act of 1934 Date of Report (Date of earliest event reported): February 12, 2003 GARMIN LTD. (Exact name of registrant as specified in its charter) Cayman Islands 0-31983 98-0229227 (State or other (Commission (I.R.S. Employer jurisdiction File Number) Identification No.) of incorporation) P.O. Box 30464 SMB 5th Floor, Harbour Place 103 South Church Street George Town, Grand Cayman, Cayman Islands (Address of principal executive offices) Registrant's telephone number, including area code: (345) 946-5203* Not Applicable (Former name or former address, if changed since last report) - -------- * The executive offices of the Registrant's principal United States subsidiary are located at 1200 East 151st Street, Olathe, Kansas 66062. The telephone number there is (913) 397-8200. Item 9. Regulation FD Disclosure See attached as Exhibit 99.1 to this Form 8-K a press release dated February 12, 2003 concerning the announcement of financial results. The information in this Form 8-K, including the exhibit, is furnished pursuant to Item 9 and shall not be deemed to be "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section. The information in this Form 8-K shall not be deemed to be incorporated by reference into the Registrant's filings under the Securities Act of 1933. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. GARMIN LTD. Date: February 12, 2003 /s/ Andrew R. Etkind Andrew R. Etkind General Counsel and Secretary EXHIBIT INDEX Exhibit No. Description 99.1 Press release dated February 12, 2003 concerning the announcement of financial results. Exhibit 99.1 Garmin Reports Record Fourth Quarter and Fiscal Year, Provides 2003 Guidance CAYMAN ISLANDS, February 12, 2003/PRNewswire/ -- Garmin Ltd. (Nasdaq: GRMN - news) today announced record revenue and earnings for its fourth fiscal quarter ended December 28, 2002. "Fiscal 2002 has been a remarkable year for us. We are pleased to report that, in the face of weak overall consumer spending, demand for our products remains strong," said Dr. Min Kao, CEO of Garmin Ltd. "Overall revenue grew 26 percent, primarily spurred by growth in our consumer segment. This segment recorded a 46 percent growth in revenues during this quarter, and 33.2 percent during 2002, with strength across all of our consumer product lines. Additionally, during the fourth quarter we experienced a 80.6 percent growth in EPS when excluding the effects of foreign currency from the prior year quarter. Including effects of foreign currency, the fourth quarter EPS growth rate was 62.2 percent. Net income for the fourth quarter increased to $45.5 million, or $0.42 per share, compared to $28 million or $0.26 per share in the prior year. Net foreign currency gains and losses were in total insignificant in 2002, and had no impact on EPS. Given this fact, diluted EPS (including the effects of foreign currency) for the year was $1.32, which compares to a diluted EPS of $1.05 for fiscal year 2001. New products have been enthusiastically received across the board. Consumer awareness of the utility of GPS navigation continues to grow, we have experienced continued growth in our core markets as a result." Fourth Quarter 2002 Revenue for the quarter increased 43.7 percent to $133.7 million from $93.0 million in the year-ago quarter, in line with guidance given of $132-$135 million. Net income increased to $45.5 million, or $0.42 diluted earnings per share, compared to $28 million or $0.26 diluted earnings per share in the year-ago quarter. Fourth quarter net income included a $157,000 foreign currency gain as a result of a weaker U.S. dollar compared to the Taiwan dollar. Excluding the effects of foreign currency, diluted EPS for the quarter was $0.42 compared to $0.23 in the year-ago quarter. Consumer revenue for the fourth quarter totaled $102 million - a 46 percent growth compared to the fourth quarter of 2001. Aviation revenue totaled $31.7 million - a 36.7 percent increase compared to the year-ago quarter. Total units sold for the quarter increased to 478,000 from 338,000 - representing an increase of 41.4 percent. Revenue increased across all geographic regions during the fourth quarter of fiscal 2002 when compared to the year-ago quarter: - - North America revenue was $100.1 million compared to $67.8 million, up 47.6 percent. - - Europe revenue was $27.1 million compared to $20.0 million, up 35.5 percent. - - Asia revenue was $6.5 million compared to $5.2 million, up 25.0 percent. "We are pleased with our financial performance during the fourth quarter," said Kevin Rauckman, chief financial officer of Garmin Ltd. "Our consumer business has now logged its fifth consecutive quarter of year-over-year revenue growth in excess of twenty percent. Gross margins strengthened to 55.2 percent compared to 53.2 percent in the prior year's fourth quarter. We also generated $39.2 million of free cash flow for the quarter, resulting in a cash and marketable securities balance of $462.5 million at the end of fiscal 2002." Fiscal 2002 Results Revenue for the fiscal year ending December 28, 2002 was $465.1 million - up 26 percent from the $369.1 million generated in the year-ago period, in line with guidance given of $464-$467 million. Net income increased to $142.8 million, or $1.32 diluted earnings per share, compared to $104.8 million or $0.97 diluted earnings per share in the year-ago period, excluding the effects of foreign currency. On a year-to-date basis, foreign currency fluctuations were an insignificant dollar amount and did not impact the EPS calculation. Consumer revenue for the fiscal year totaled $350.6 million - a 33.2 percent growth compared to the year-ago period. Aviation revenue totaled $114.5 million - - an 8.2 percent increase compared to fiscal 2001. Total units sold for the period increased to 1,557,000 from 1,331,000 - representing an increase of 17 percent. Revenue increased across all geographic regions during fiscal 2002 when compared to 2001: - - North America revenue was $339.4 million compared to $275.6 million, up 23.1 percent. - - Europe revenue was $103.0 million compared to $78.5 million, up 31.2 percent. - - Asia revenue was $22.7 million compared to $15.0 million, up 51.3 percent. 2003 Outlook The Company estimates that its diluted EPS for the first fiscal quarter of 2003, excluding effects for foreign currency, will be in the range of $0.29 to $0.32 on revenues of $113 million to $117 million. Diluted EPS estimates for fiscal year 2003, excluding effects of foreign currency, will be in the range of $1.45 to $1.54 on revenues of $515 million to $540 million. Two innovative products were introduced in January 2003 at the Consumer Electronics Show in Las Vegas, Nevada. Both the new iQue (the first PDA with fully integrated GPS navigation) and the Geko (miniature-sized basic GPS unit priced under $100) were enthusiastically received, and both were given innovation awards at the show. Garmin believes innovations and ongoing growth are in the Company's future, in 2003 and beyond. The Company has previously announced the following activities to support future growth: o Complete the installation of two newly purchased surface-mount technology lines for the production facility in Taiwan to support the Company's growing consumer product demands. o Expand the Olathe, Kansas facility, with scheduled completion in 2004. This $60 million expansion will include additional floor space to support Garmin's current and future research and development needs, expansion of the customer call center, additional warehouse facilities, and other business needs. o Implement Oracle's E-Business suite, a fully integrated enterprise suite of business applications and supporting technologies, to upgrade its existing MRPII system. The new Oracle ERP (Enterprise Resource Planning) system will provide improved integration among the major Garmin business entities in Taiwan, Europe, and the United States, and enable the company to achieve a higher level of efficiency. The system will be implemented in phases over the next couple of years. Earnings Call Information The information for Garmin Ltd.'s earnings call is as follows: When: Wednesday, February 12, 2003 at 11:00 a.m. Eastern Where: http://www.garmin.com/aboutGarmin/invRelations/irCalendar.html How: Simply log on to the web at the address above or call to listen in at 866-783-5359. 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 15091084. An archive of the live webcast will be available until March 12, 2003 on the Garmin website at http://www.garmin.com. To access the replay, click on the Investor Relations link and click over to the Events Calendar page. 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 29, 2001 filed by Garmin with the Securities and Exchange Commission (Commission file number 0-31983). A copy of Garmin's 2001 Form 10-K can be downloaded from http://www.garmin.com/aboutGarmin/invRelations/finReports.html. Through its operating subsidiaries, Garmin Ltd. designs, manufactures, and markets navigation, communications and information devices, most of which are enabled by GPS technology. Garmin is a leader in the general aviation and consumer markets and its products serve aviation, marine, general recreation, automotive, wireless and OEM applications. 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) 13-Weeks Ended ------------------------------- Dec. 28, Dec. 29, 2002 2001 ------------------------------- Net sales $133,694 $93,021 Cost of goods sold 59,842 43,559 -------------- ------------- Gross profit 73,852 49,462 Selling, general and Administrative expenses 12,061 9,965 Research and development Expense 8,760 7,793 -------------- ------------- 20,821 17,758 -------------- ------------- Operating income 53,031 31,704 Other income (A) 1,482 5,864 -------------- ------------- Income before income taxes 54,513 37,568 Income tax provision 9,050 9,523 -------------- ------------- Net income $45,463 $28,045 ============== ============= Net income per share: Basic $0.42 $0.26 Diluted $0.42 $0.26 Weighted average common shares outstanding: Basic 107,765 107,662 Diluted 108,251 107,906 (A) Includes $157 thousand of foreign currency gains in Q4 2002 and $3.9 million of gains in Q4 2001 Garmin Ltd. And Subsidiaries Condensed Consolidated Statements of Income (In thousands, except per share information) Fiscal Year Ended ------------------------------- Dec. 28, Dec. 29, 2002 2001 ------------------------------- Net sales $465,144 $369,119 Cost of goods sold 210,088 170,960 -------------- -------------- Gross profit 255,056 198,159 Selling, general and Administrative expenses 45,453 38,709 Research and development Expense 32,163 28,164 -------------- -------------- 77,616 66,873 -------------- -------------- Operating income 177,440 131,286 Other income (A) 5,295 20,749 -------------- -------------- Income before income taxes 182,735 152,035 Income tax provision 39,937 38,587 -------------- -------------- Net income $142,798 $113,448 ============== ============== Net income per share: Basic $1.32 $1.05 Diluted $1.32 $1.05 Weighted average common shares outstanding: Basic 107,774 108,097 Diluted 108,201 108,447 (A) Includes $11 thousand of foreign currency gains in 2002 and $11.6 million of gains in 2001. Garmin Ltd. And Subsidiaries Condensed Consolidated Balance Sheets (In thousands)
--------------------------------------- December 28, December 29, 2002 2001 --------------------------------------- Assets Current assets: Cash and cash equivalents $216,768 $192,842 Marketable securities 75,538 40,835 Accounts receivable, net 58,278 47,998 Inventories 57,507 61,132 Deferred income taxes 13,266 7,007 Prepaid expenses and other current assets 4,490 2,921 ----------------- ---------------- Total current assets 425,847 352,735 Property and equipment, net 74,440 70,086 Restricted cash 1,598 1,600 Marketable securities 170,170 90,749 Other assets, net 24,479 16,985 ----------------- ---------------- Total assets $696,534 $532,155 ================= ================ Liabilities and Stockholders' Equity Current liabilities: Accounts payable $32,446 $18,837 Salaries and benefits payable 4,178 3,308 Warranty reserve 4,376 4,777 Income taxes payable 18,080 12,444 Current portion of long-term debt 1,334 4,177 Other accrued expenses 14,325 5,485 ----------------- ---------------- Total current liabilities 74,739 49,028 Long-term debt 18,666 28,011 Deferred income taxes 631 1,147 Stockholders' equity: Common stock 1,088 1,078 Additional paid-in capital 128,396 127,131 Retained earnings 507,884 365,087 Accumulated other comprehensive loss (34,870) (39,327) ----------------- ---------------- Total stockholders' equity 602,498 453,969 ----------------- ---------------- Total liabilities and stockholders' equity $696,534 $532,155 ================= ================
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