SUNNYVALE, Calif., Aug. 2, 2016 /PRNewswire/ -- Trimble
(NASDAQ: TRMB) today announced financial results for the second
quarter of 2016.
Second Quarter 2016 Financial Summary
Second quarter 2016 revenue of $609.6
million was up 4 percent as compared to the second quarter
of 2015. Engineering and Construction revenue was $351.2 million, up 4 percent. Field Solutions
revenue was $87.1 million,
approximately flat. Mobile Solutions revenue was $138.1 million, up 8 percent. Advanced Devices
revenue was $33.2 million, up 4
percent. Foreign currency translation had a neutral impact on
company revenue compared to the second quarter of 2015.
GAAP operating income was $40.5
million, up 13 percent as compared to the second quarter of
2015. GAAP operating margin was 6.7 percent of revenue as compared
to 6.1 percent of revenue in the second quarter of 2015.
GAAP net income was $35.7 million,
up 38 percent as compared to the second quarter of 2015. Diluted
GAAP earnings per share were $0.14 as
compared to diluted GAAP earnings per share of $0.10 in the second quarter of 2015.
Non-GAAP operating income of $99.0
million was up 2 percent as compared to the second quarter
of 2015. Non-GAAP operating margin was 16.2 percent of revenue as
compared to 16.6 percent of revenue in the second quarter of
2015.
Non-GAAP net income of $74.1
million was flat as compared to the second quarter of 2015.
Diluted non-GAAP earnings per share were $0.29 as compared to diluted non-GAAP earnings
per share of $0.28 in the second
quarter of 2015.
The GAAP tax rate for the quarter was 7 percent as compared to
28 percent in the second quarter of 2015, and the non-GAAP tax rate
was 24 percent, unchanged from the second quarter of
2015.
Operating cash flow for the first two quarters of 2016 was
$192.5 million, down 6 percent as
compared to the first two quarters of 2015. Deferred revenue for
the second quarter of 2016 was $315.2
million, up 10 percent as compared to the second quarter of
2015.
During the second quarter, Trimble repurchased approximately
$80 million of its common stock, and
has repurchased approximately $92
million of its common stock year to date. Approximately
$158 million remains under the
current share repurchase authorization as of the end of the second
quarter.
"Second quarter results were consistent with expectations and
reinforced the trend towards higher revenue growth," said
Steven W. Berglund, Trimble's
president and chief executive officer. "Although Brexit and the
outcome of the US elections have introduced new uncertainties, we
continue to anticipate higher growth in the second half of 2016
which is expected to carry into 2017. Higher revenue growth,
combined with our cost and portfolio rationalization efforts, will
enable operating margin expansion."
Forward Looking Guidance
For the third quarter of 2016 Trimble expects revenue to be
between $587 million and $617 million
with GAAP earnings per share of $0.11 to
$0.16 and non-GAAP earnings per share of $0.28 to $0.33. Non-GAAP guidance excludes the
amortization of intangibles of $37
million related to previous acquisitions, anticipated
acquisition costs of $1 million, the
anticipated impact of stock-based compensation expense of
$14 million, and $5 million in anticipated restructuring charges.
GAAP guidance assumes a tax rate of 26 percent and non-GAAP
guidance assumes a tax rate of 24 percent. Both GAAP and non-GAAP
earnings per share assume approximately 253 million shares
outstanding.
Investor Conference Call / Webcast Details
Trimble will hold a conference call on August 2 at 2:00 p.m.
PT to review its second quarter 2016 results. An
accompanying slide presentation will be made available on the
"Investors" section of the Trimble website, www.trimble.com, under
the subheading "Events & Presentations". The call 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). The passcode is 53406055.
The replay will also be available on the Web at the address
above.
Use of Non-GAAP Financial Information
To help our investors understand our past financial performance
and our future results, as well as our performance relative to
competitors, we supplement the financial results that we provide in
accordance with generally accepted accounting principles, or GAAP,
with non-GAAP financial measures. These non-GAAP measures can be
used to evaluate our historical and prospective financial
performance, as well as our performance relative to competitors.
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. Further, we believe some of our investors track our "core
operating performance" as a means of evaluating our performance in
the ordinary, ongoing, and customary course of our operations. Core
operating performance excludes items that are non-cash, not
expected to recur or not reflective of ongoing financial results.
Management also believes that looking at our core operating
performance provides a supplemental way to provide consistency in
period to period comparisons.
The specific non-GAAP measures, which we use along with a
reconciliation to the nearest comparable GAAP measures and the
explanation for why these non-GAAP measures provide useful
information to investors regarding our financial condition and
results of operations and why management chose to exclude selected
items 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. 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.
About Trimble
Trimble is transforming the way the world works by delivering
products and services that connect the physical and digital worlds.
Core technologies in positioning, modeling, connectivity and data
analytics enable customers to improve productivity, quality, safety
and sustainability. From purpose built products to enterprise
lifecycle solutions, Trimble software, hardware and services are
transforming a broad range of industries such as agriculture,
construction, geospatial and transportation and logistics. For more
information about Trimble (NASDAQ:TRMB),
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 impact of
acquisitions, the ability to deliver revenue, earnings per share
and other financial projections that Trimble has guided for the
third quarter and full year, including the expected tax rate,
anticipated impact of stock-based compensation expense,
amortization of intangibles related to previous acquisitions,
anticipated acquisition costs, restructuring charges, and the
anticipated number of diluted shares outstanding. 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. The Company's
results may be adversely affected if the Company is unable to
market, manufacture and ship new products, obtain new customers, or
integrate new acquisitions. The Company's results would also be
negatively impacted by weakening in the macro environment or
foreign exchange fluctuations. 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 and
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, such as changes in economic conditions, further
worsening in the agricultural market, critical part supply chain
shortages, and possible write-offs of goodwill. 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 millions, except
per share data)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Second Quarter
of
|
|
First Two Quarters
of
|
|
|
|
|
|
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
|
|
|
|
|
|
|
|
Revenue:
|
|
|
|
|
|
|
|
|
Product
|
$
407.0
|
|
$
394.6
|
|
$
800.6
|
|
$
795.2
|
|
Service
|
109.7
|
|
105.7
|
|
211.3
|
|
206.6
|
|
Subscription
|
92.9
|
|
85.5
|
|
180.7
|
|
166.6
|
|
Total
revenue
|
609.6
|
|
585.8
|
|
1,192.6
|
|
1,168.4
|
|
|
|
|
|
|
|
|
|
Cost of
sales:
|
|
|
|
|
|
|
|
|
Product
|
199.4
|
|
190.8
|
|
389.4
|
|
378.5
|
|
Service
|
44.0
|
|
42.2
|
|
85.6
|
|
83.6
|
|
Subscription
|
26.6
|
|
25.9
|
|
53.3
|
|
49.7
|
|
Amortization of purchased intangible assets
|
24.0
|
|
23.0
|
|
48.1
|
|
45.5
|
|
Total cost of
sales
|
294.0
|
|
281.9
|
|
576.4
|
|
557.3
|
|
Gross
margin
|
315.6
|
|
303.9
|
|
616.2
|
|
611.1
|
|
Gross margin
(%)
|
51.8%
|
|
51.9%
|
|
51.7%
|
|
52.3%
|
|
|
|
|
|
|
|
|
|
Operating
expense:
|
|
|
|
|
|
|
|
|
Research and development
|
92.0
|
|
84.5
|
|
179.7
|
|
171.7
|
|
Sales and marketing
|
97.4
|
|
96.2
|
|
194.1
|
|
192.7
|
|
General and administrative
|
65.6
|
|
64.2
|
|
133.9
|
|
128.9
|
|
Restructuring charges
|
4.5
|
|
5.2
|
|
6.3
|
|
6.3
|
|
Amortization of purchased intangible assets
|
15.6
|
|
17.8
|
|
31.8
|
|
36.0
|
|
Total operating
expense
|
275.1
|
|
267.9
|
|
545.8
|
|
535.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
40.5
|
|
36.0
|
|
70.4
|
|
75.5
|
|
|
|
|
|
|
|
|
|
Non-operating income
(expense), net:
|
|
|
|
|
|
|
|
|
Interest expense
|
(6.6)
|
|
(6.3)
|
|
(13.2)
|
|
(12.7)
|
|
Foreign currency transaction gain (loss), net
|
(1.5)
|
|
-
|
|
(1.6)
|
|
1.1
|
|
Income from equity method investments, net
|
5.8
|
|
6.4
|
|
8.7
|
|
9.4
|
|
Other income, net
|
0.1
|
|
(0.3)
|
|
3.4
|
|
6.7
|
|
Total
non-operating income (expense), net
|
(2.2)
|
|
(0.2)
|
|
(2.7)
|
|
4.5
|
|
|
|
|
|
|
|
|
|
Income before
taxes
|
38.3
|
|
35.8
|
|
67.7
|
|
80.0
|
|
|
|
|
|
|
|
|
|
Income tax
provision
|
2.7
|
|
10.0
|
|
12.4
|
|
20.2
|
|
Net income
|
35.6
|
|
25.8
|
|
55.3
|
|
59.8
|
|
Less: Net income
(loss) attributable to noncontrolling interests
|
(0.1)
|
|
(0.1)
|
|
(0.2)
|
|
(0.2)
|
|
Net income
attributable to Trimble Navigation Limited
|
$
35.7
|
|
$
25.9
|
|
$
55.5
|
|
$
60.0
|
|
|
|
|
|
|
|
|
|
Earnings per share
attributable to Trimble Navigation Limited:
|
|
|
|
|
|
|
|
|
Basic
|
$
0.14
|
|
$
0.10
|
|
$
0.22
|
|
$
0.23
|
|
Diluted
|
$
0.14
|
|
$
0.10
|
|
$
0.22
|
|
$
0.23
|
|
|
|
|
|
|
|
|
|
Shares used in
calculating earnings per share:
|
|
|
|
|
|
|
|
|
Basic
|
250.5
|
|
258.4
|
|
250.8
|
|
258.9
|
|
Diluted
|
253.7
|
|
261.4
|
|
253.9
|
|
261.9
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
(In
millions)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
Second Quarter
of
|
|
Fiscal Year
End
|
|
As of
|
2016
|
|
2015
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and
cash equivalents
|
$
231.9
|
|
$
116.0
|
|
Accounts
receivable, net
|
377.5
|
|
361.9
|
|
Other
receivables
|
36.1
|
|
14.9
|
|
Inventories
|
241.7
|
|
261.1
|
|
Other
current assets
|
49.6
|
|
44.5
|
|
Total current
assets
|
936.8
|
|
798.4
|
|
|
|
|
|
Property and
equipment, net
|
152.0
|
|
159.2
|
|
Goodwill
|
2,107.9
|
|
2,106.4
|
|
Other purchased
intangible assets, net
|
408.9
|
|
487.1
|
|
Other non-current
assets
|
146.0
|
|
129.6
|
|
|
|
|
|
Total
assets
|
$
3,751.6
|
|
$
3,680.7
|
|
|
|
|
|
Liabilities and
Shareholders' Equity
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Short-term debt
|
$
130.3
|
|
$
118.3
|
|
Accounts
payable
|
106.7
|
|
99.8
|
|
Accrued
compensation and benefits
|
101.3
|
|
98.9
|
|
Deferred
revenue
|
280.5
|
|
234.6
|
|
Accrued
warranty expense
|
17.8
|
|
18.5
|
|
Other
current liabilities
|
84.4
|
|
90.8
|
|
Total current
liabilities
|
721.0
|
|
660.9
|
|
|
|
|
|
Long-term
debt
|
594.7
|
|
611.4
|
|
Non-current deferred
revenue
|
34.7
|
|
29.6
|
|
Deferred income tax
liabilities
|
48.1
|
|
51.7
|
|
Other non-current
liabilities
|
108.4
|
|
106.5
|
|
Total
liabilities
|
1,506.9
|
|
1,460.1
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
Common
stock
|
1,276.4
|
|
1,238.3
|
|
Retained
earnings
|
1,128.1
|
|
1,148.2
|
|
Accumulated other comprehensive loss
|
(159.7)
|
|
(166.8)
|
|
Total Trimble
Navigation Limited shareholders'
equity
|
2,244.8
|
|
2,219.7
|
|
Noncontrolling
interests
|
(0.1)
|
|
0.9
|
|
Total shareholders'
equity
|
2,244.7
|
|
2,220.6
|
|
|
|
|
|
Total liabilities and
shareholders' equity
|
$
3,751.6
|
|
$
3,680.7
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(In
millions)
|
|
(Unaudited)
|
|
First Two Quarters
of
|
|
2016
|
|
2015
|
|
|
|
|
|
Cash flow from
operating activities:
|
|
|
|
|
Net Income
|
$
55.3
|
|
$
59.8
|
|
|
|
|
|
Adjustments to reconcile net income to net cash provided
by
|
|
|
|
|
operating
activities:
|
|
|
|
|
Depreciation expense
|
18.8
|
|
17.9
|
|
Amortization expense
|
79.9
|
|
81.5
|
|
Provision for doubtful accounts
|
2.4
|
|
1.2
|
|
Deferred income taxes
|
0.5
|
|
(0.8)
|
|
Stock-based compensation
|
26.7
|
|
24.5
|
|
Income from equity method investments
|
(8.7)
|
|
(9.4)
|
|
Divestiture gain, net
|
(2.7)
|
|
(5.6)
|
|
Excess tax benefit for stock-based compensation
|
(3.1)
|
|
(0.9)
|
|
Provision for excess and obsolete inventories
|
8.8
|
|
2.0
|
|
Other non-cash items
|
3.0
|
|
10.0
|
|
|
|
|
|
Decrease (increase) in assets:
|
|
|
|
|
Accounts receivables
|
(18.2)
|
|
1.3
|
|
Other receivables
|
(1.5)
|
|
3.7
|
|
Inventories
|
11.2
|
|
(11.8)
|
|
Other current and non-current assets
|
(7.8)
|
|
(8.3)
|
|
|
|
|
|
Increase (decrease) in liabilities:
|
|
|
|
|
Accounts payable
|
6.4
|
|
6.1
|
|
Accrued compensation and benefits
|
2.2
|
|
(0.8)
|
|
Deferred revenue
|
53.8
|
|
49.5
|
|
Accrued warranty
|
(0.7)
|
|
(1.4)
|
|
Other liabilities
|
(33.8)
|
|
(14.5)
|
|
Net cash
provided by operating activities
|
192.5
|
|
204.0
|
|
|
|
|
|
Cash flow from
investing activities:
|
|
|
|
|
Acquisitions of
businesses, net of cash acquired
|
(20.0)
|
|
(59.1)
|
|
Acquisitions of
property and equipment
|
(12.2)
|
|
(26.5)
|
|
Purchases of equity
method investments
|
(1.5)
|
|
(2.8)
|
|
Net proceeds from sale
of businesses
|
10.7
|
|
12.6
|
|
Dividends received
from equity method investments
|
10.7
|
|
7.7
|
|
Other
|
(0.3)
|
|
0.4
|
|
Net cash used
in investing activities
|
(12.6)
|
|
(67.7)
|
|
|
|
|
|
Cash flow from
financing activities:
|
|
|
|
|
Issuance of common
stock, net of tax withholdings
|
25.0
|
|
16.0
|
|
Repurchases and
retirement of common stock
|
(88.3)
|
|
(73.0)
|
|
Excess tax benefit for
stock-based compensation
|
3.1
|
|
0.9
|
|
Proceeds from debt and
revolving credit lines
|
202.0
|
|
220.0
|
|
Payments on debt and
revolving credit lines
|
(207.0)
|
|
(312.1)
|
|
Net cash used
in financing activities
|
(65.2)
|
|
(148.2)
|
|
|
|
|
|
Effect of
exchange rate changes on cash and cash equivalents
|
1.2
|
|
(7.1)
|
|
|
|
|
|
Net increase
(decrease) in cash and cash equivalents
|
115.9
|
|
(19.0)
|
|
Cash and cash
equivalents - beginning of period
|
116.0
|
|
148.0
|
|
|
|
|
|
Cash and cash
equivalents - end of period
|
$
231.9
|
|
$129.0
|
|
REPORTING
SEGMENTS
|
|
(Dollars in
millions)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reporting
Segments
|
|
|
|
Engineering
|
|
|
|
|
|
|
|
|
|
and
|
|
Field
|
|
Mobile
|
|
Advanced
|
|
|
|
Construction
|
|
Solutions
|
|
Solutions
|
|
Devices
|
|
|
|
|
|
|
|
|
|
|
|
SECOND QUARTER OF
FISCAL 2016 :
|
|
|
|
|
|
|
|
|
Revenue
|
$
351.2
|
|
$
87.1
|
|
$
138.1
|
|
$
33.2
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
before corporate allocations
|
$
61.8
|
|
$
25.5
|
|
$
18.9
|
|
$
11.5
|
|
|
Operating margin (%
of segment external net revenue)
|
17.6%
|
|
29.3%
|
|
13.7%
|
|
34.6%
|
|
|
|
|
|
|
|
|
|
|
|
SECOND QUARTER OF
FISCAL 2015 :
|
|
|
|
|
|
|
|
|
Revenue
|
$
338.5
|
|
$
87.1
|
|
$
128.3
|
|
$
31.9
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
before corporate allocations
|
$
60.5
|
|
$
24.9
|
|
$
18.9
|
|
$
11.1
|
|
|
Operating margin (%
of segment external net revenue)
|
17.9%
|
|
28.6%
|
|
14.7%
|
|
34.8%
|
|
|
|
|
|
|
|
|
|
|
|
FISCAL YEAR 2016
:
|
|
|
|
|
|
|
|
|
Revenue
|
$
661.0
|
|
$
193.1
|
|
$
274.4
|
|
$
64.1
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
before corporate allocations
|
$
105.9
|
|
$
59.4
|
|
$
37.8
|
|
$
21.8
|
|
|
Operating margin (%
of segment external net revenue)
|
16.0%
|
|
30.8%
|
|
13.8%
|
|
34.0%
|
|
|
|
|
|
|
|
|
|
|
|
FISCAL YEAR 2015
:
|
|
|
|
|
|
|
|
|
Revenue
|
$
637.8
|
|
$
202.4
|
|
$
256.5
|
|
$
71.7
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
before corporate allocations
|
$
97.5
|
|
$
65.5
|
|
$
39.4
|
|
$
26.3
|
|
|
Operating margin (%
of segment external net revenue)
|
15.3%
|
|
32.4%
|
|
15.4%
|
|
36.7%
|
|
GAAP TO NON-GAAP
RECONCILIATION
(Dollars in millions, except per share data)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Second Quarter
of
|
|
First Two Quarters
of
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
|
|
Dollar
Amount
|
% of
Revenue
|
|
Dollar
Amount
|
% of
Revenue
|
|
Dollar
Amount
|
% of
Revenue
|
|
Dollar
Amount
|
% of
Revenue
|
|
|
GROSS
MARGIN:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP gross
margin:
|
|
$
315.6
|
51.8%
|
|
$
303.9
|
51.9%
|
|
$
616.2
|
51.7%
|
|
$
611.1
|
52.3%
|
|
|
|
Restructuring
charges
|
( A )
|
0.4
|
0.1%
|
|
0.3
|
0.1%
|
|
0.7
|
0.1%
|
|
0.5
|
0.0%
|
|
|
|
Amortization of
purchased intangible assets
|
( B )
|
24.0
|
3.9%
|
|
23.0
|
3.9%
|
|
48.1
|
4.0%
|
|
45.5
|
3.9%
|
|
|
|
Stock-based
compensation
|
( C )
|
0.9
|
0.1%
|
|
1.0
|
0.2%
|
|
1.9
|
0.1%
|
|
1.9
|
0.2%
|
|
|
Non-GAAP gross
margin:
|
|
$
340.9
|
55.9%
|
|
$
328.2
|
56.1%
|
|
$
666.9
|
55.9%
|
|
$
659.0
|
56.4%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING
EXPENSES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating
expenses:
|
|
$
275.1
|
45.1%
|
|
$
267.9
|
45.7%
|
|
$
545.8
|
45.8%
|
|
$
535.6
|
45.8%
|
|
|
|
Restructuring
charges
|
( A )
|
(4.5)
|
-0.7%
|
|
(5.2)
|
-0.9%
|
|
(6.3)
|
-0.5%
|
|
(6.3)
|
-0.5%
|
|
|
|
Amortization of
purchased intangible assets
|
( B )
|
(15.6)
|
-2.6%
|
|
(17.8)
|
-3.0%
|
|
(31.8)
|
-2.7%
|
|
(36.0)
|
-3.1%
|
|
|
|
Stock-based
compensation
|
( C )
|
(12.1)
|
-2.0%
|
|
(11.0)
|
-1.9%
|
|
(24.8)
|
-2.1%
|
|
(22.6)
|
-1.9%
|
|
|
|
Acquisition /
divestiture items
|
( D )
|
(0.9)
|
-0.1%
|
|
(2.8)
|
-0.5%
|
|
(2.5)
|
-0.2%
|
|
(5.6)
|
-0.5%
|
|
|
|
Executive transition
costs
|
( E )
|
(0.1)
|
0.0%
|
|
-
|
0.0%
|
|
(1.0)
|
-0.1%
|
|
-
|
0.0%
|
|
|
Non-GAAP operating
expenses:
|
|
$
241.9
|
39.7%
|
|
$
231.1
|
39.4%
|
|
$
479.4
|
40.2%
|
|
$
465.1
|
39.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING
INCOME:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating
income:
|
|
$
40.5
|
6.7%
|
|
$
36.0
|
6.1%
|
|
$
70.4
|
5.9%
|
|
$
75.5
|
6.5%
|
|
|
|
Restructuring
charges
|
( A )
|
4.9
|
0.8%
|
|
5.5
|
0.9%
|
|
7.0
|
0.6%
|
|
6.8
|
0.6%
|
|
|
|
Amortization of
purchased intangible assets
|
( B )
|
39.6
|
6.5%
|
|
40.8
|
7.0%
|
|
79.9
|
6.7%
|
|
81.5
|
7.0%
|
|
|
|
Stock-based
compensation
|
( C )
|
13.0
|
2.1%
|
|
12.0
|
2.0%
|
|
26.7
|
2.2%
|
|
24.5
|
2.0%
|
|
|
|
Acquisition /
divestiture items
|
( D )
|
0.9
|
0.1%
|
|
2.8
|
0.0%
|
|
2.5
|
0.2%
|
|
5.6
|
0.5%
|
|
|
|
Executive transition
costs
|
( E )
|
0.1
|
0.0%
|
|
-
|
0.6%
|
|
1.0
|
0.1%
|
|
-
|
0.0%
|
|
|
Non-GAAP operating
income:
|
|
$
99.0
|
16.2%
|
|
$
97.1
|
16.6%
|
|
$
187.5
|
15.7%
|
|
$
193.9
|
16.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NON-OPERATING
INCOME (EXPENSE), NET:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP non-operating
income (expense), net:
|
|
$
(2.2)
|
|
|
$
(0.2)
|
|
|
$
(2.7)
|
|
|
$
4.5
|
|
|
|
|
Acquisition /
divestiture items
|
( D )
|
0.4
|
|
|
0.2
|
|
|
(2.7)
|
|
|
(5.6)
|
|
|
|
|
Debt issuance cost
write-off
|
( F )
|
-
|
|
|
0.1
|
|
|
-
|
|
|
-
|
|
|
|
Non-GAAP
non-operating income (expense), net:
|
|
$
(1.8)
|
|
|
$
0.1
|
|
|
$
(5.4)
|
|
|
$
(1.1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP
and
|
|
|
GAAP
and
|
|
|
GAAP
and
|
|
|
GAAP
and
|
|
|
|
|
|
|
Non-GAAP
|
|
|
Non-GAAP
|
|
|
Non-GAAP
|
|
|
Non-GAAP
|
|
|
|
|
|
|
Tax Rate %
|
( I )
|
|
Tax Rate %
|
( I )
|
|
Tax Rate %
|
( I )
|
|
Tax Rate %
|
( I )
|
|
INCOME TAX
PROVISION:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP income tax
provision:
|
|
$
2.7
|
7%
|
|
$
10.0
|
28%
|
|
$
12.4
|
18%
|
|
$
20.2
|
25%
|
|
|
|
Non-GAAP items tax
effected
|
( G )
|
4.1
|
|
|
17.2
|
|
|
21.0
|
|
|
29.0
|
|
|
|
|
Difference in GAAP
and Non-GAAP tax rate
|
( H )
|
16.4
|
|
|
(3.9)
|
|
|
10.3
|
|
|
(2.9)
|
|
|
|
Non-GAAP income tax
provision:
|
|
$
23.2
|
24%
|
|
$
23.3
|
24%
|
|
$
43.7
|
24%
|
|
$
46.3
|
24%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET
INCOME:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income
attributable to Trimble Navigation Limited
|
|
$
35.7
|
|
|
$
25.9
|
|
|
$
55.5
|
|
|
$
60.0
|
|
|
|
|
Restructuring
charges
|
( A )
|
4.9
|
|
|
5.5
|
|
|
7.0
|
|
|
6.8
|
|
|
|
|
Amortization of
purchased intangible assets
|
( B )
|
39.6
|
|
|
40.8
|
|
|
79.9
|
|
|
81.5
|
|
|
|
|
Stock-based
compensation
|
( C )
|
13.0
|
|
|
12.0
|
|
|
26.7
|
|
|
24.5
|
|
|
|
|
Acquisition /
divestiture items
|
( D )
|
1.3
|
|
|
3.0
|
|
|
(0.2)
|
|
|
-
|
|
|
|
|
Executive transition
costs
|
( E )
|
0.1
|
|
|
-
|
|
|
1.0
|
|
|
-
|
|
|
|
|
Debt issuance cost
write-off
|
( F )
|
-
|
|
|
0.1
|
|
|
-
|
|
|
-
|
|
|
|
|
Non-GAAP tax
adjustments
|
( G ) + ( H
)
|
(20.5)
|
|
|
(13.3)
|
|
|
(31.3)
|
|
|
(26.1)
|
|
|
|
Non-GAAP net income
attributable to Trimble Navigation Limited
|
|
$
74.1
|
|
|
$
74.0
|
|
|
$
138.6
|
|
|
$
146.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DILUTED NET INCOME
PER SHARE:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP diluted net
income per share attributable to Trimble Navigation
Limited
|
|
$
0.14
|
|
|
$
0.10
|
|
|
$
0.22
|
|
|
$
0.23
|
|
|
|
|
Restructuring
charges
|
( A )
|
0.02
|
|
|
0.02
|
|
|
0.03
|
|
|
0.03
|
|
|
|
|
Amortization of
purchased intangible assets
|
( B )
|
0.15
|
|
|
0.16
|
|
|
0.31
|
|
|
0.31
|
|
|
|
|
Stock-based
compensation
|
( C )
|
0.05
|
|
|
0.04
|
|
|
0.11
|
|
|
0.09
|
|
|
|
|
Acquisition /
divestiture items
|
( D )
|
0.01
|
|
|
0.01
|
|
|
-
|
|
|
-
|
|
|
|
|
Executive transition
costs
|
( E )
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
|
|
Debt issuance cost
write-off
|
( F )
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
|
|
Non-GAAP tax
adjustments
|
( G ) + ( H
)
|
(0.08)
|
|
|
(0.05)
|
|
|
(0.12)
|
|
|
(0.10)
|
|
|
|
Non-GAAP diluted net
income per share attributable to Trimble Navigation
Limited
|
|
$
0.29
|
|
|
$
0.28
|
|
|
$
0.55
|
|
|
$
0.56
|
|
|
FOOTNOTES TO GAAP TO NON-GAAP
RECONCILIATION
(Unaudited)
Our non-GAAP measures are not meant to be considered in
isolation or as a substitute for comparable GAAP measures. The
non-GAAP financial measures included in the previous table as well
as detailed explanations to the adjustments to comparable GAAP
measures, are set forth below:
Non-GAAP gross margin
We believe our investors benefit by understanding our non-GAAP
gross margin as a way of understanding how product mix, pricing
decisions and manufacturing costs influence our business. Non-GAAP
gross margin excludes restructuring costs, amortization of
purchased intangible assets and stock-based compensation from GAAP
gross margin. We believe that these exclusions offer investors
additional information that may be useful to view trends in our
gross margin performance.
Non-GAAP operating expenses
We believe this measure is important to investors evaluating our
non-GAAP spending in relation to revenue. Non-GAAP operating
expenses exclude restructuring costs, amortization of purchased
intangible assets, stock-based compensation,
acquisition/divestiture costs associated with external and
incremental costs resulting directly from merger and acquisition
activities such as legal, due diligence, and integration costs, and
executive transition costs from GAAP operating expenses. We believe
that these exclusions offer investors supplemental information to
facilitate comparison of our operating expenses to our prior
results.
Non-GAAP operating income
We believe our investors benefit by understanding our non-GAAP
operating income trends which are driven by revenue, gross margin,
and spending. Non-GAAP operating income excludes restructuring
costs, amortization of purchased intangible assets, stock-based
compensation, acquisition/divestiture costs associated with
external and incremental costs resulting directly from merger and
acquisition activities such as legal, due diligence, and
integration costs, and executive transition costs. We believe that
these exclusions offer an alternative means for our investors to
evaluate current operating performance compared to results of other
periods.
Non-GAAP non-operating income (expense), net
We believe this measure helps investors evaluate our
non-operating income trends. Non-GAAP non-operating income
(expense), net excludes acquisition and divestiture gains/losses
associated with unusual acquisition related items such as
intangible asset impairment charges and gains or losses related to
the acquisition or sale of certain businesses and investments.
Non-GAAP non-operating income (expense), net also excludes the
write-off of debt issuance costs associated with terminated and/or
modified credit facilities and costs associated with the issuance
of new credit facilities and Senior Notes that were not capitalized
as debt issuance costs. We believe that these exclusions provide
investors with a supplemental view of our ongoing financial
results.
Non-GAAP income tax provision
We believe that providing investors with the non-GAAP income tax
provision is beneficial because it provides for consistent
treatment of the excluded items in our non-GAAP
presentation.
Non-GAAP net income
This measure provides a supplemental view of net income trends
which are driven by non-GAAP income before taxes and our non-GAAP
tax rate. Non-GAAP net income excludes restructuring costs,
amortization of purchased intangible assets, stock-based
compensation, acquisition and divestiture costs, executive
transition costs, write-off of debt issuance costs and non-GAAP tax
adjustments from GAAP net income. We believe our investors benefit
from understanding these exclusions and from an alternative view of
our net income performance as compared to our past net income
performance.
Non-GAAP diluted net income per share
We believe our investors benefit by understanding our non-GAAP
operating performance as reflected in a per share calculation as a
way of measuring non-GAAP operating performance by ownership in the
company. Non-GAAP diluted net income per share excludes
restructuring costs, amortization of purchased intangible assets,
stock-based compensation, acquisition and divestiture costs,
executive transition costs, a write off of debt issuance costs and
non-GAAP tax adjustments from GAAP diluted net income per share. We
believe that these exclusions offer investors a useful view of our
diluted net income per share as compared to our past diluted net
income per share.
These non-GAAP measures can be used to evaluate our historical
and prospective financial performance, as well as our performance
relative to competitors. We believe some of our investors track our
"core operating performance" as a means of evaluating our
performance in the ordinary, ongoing, and customary course of our
operations. Core operating performance excludes items that are
non-cash, not expected to recur or not reflective of ongoing
financial results. Management also believes that looking at our
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 intangible assets, stock
based compensation, acquisition and divestiture costs, executive
transition costs, write-off of debt issuance costs and non-GAAP tax
adjustments. For detailed explanations of the adjustments
made to comparable GAAP measures, see items (A) - ( I ) below.
|
( A )
|
Restructuring
costs.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 costs from our non-GAAP measures because we
believe they do not reflect expected future operating expenses,
they are not indicative of our core operating performance, and they
are not meaningful in comparisons to our past operating
performance. We have incurred restructuring expense in each
of the periods presented however the amount incurred can vary
significantly based on whether a restructuring has occurred in the
period and the timing of headcount reductions.
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( B )
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Amortization of
purchased intangible assets.Included in our GAAP presentation
of gross margin and operating expenses is amortization of purchased
intangible assets. US GAAP accounting requires that intangible
assets are recorded at fair value and amortized over their useful
lives. Consequently, the timing and size of our acquisitions will
cause our operating results to vary from period to period, making a
comparison to past performance difficult for investors. This
accounting treatment may cause differences when comparing our
results to companies that grow internally because the fair value
assigned to the intangible assets acquired through acquisition may
significantly exceed the equivalent expenses that a company may
incur for similar efforts when performed internally. Furthermore,
the useful life that we expense our intangible assets over may be
substantially different from the time period that an internal
growth company incurs and recognizes such expenses. We believe that
by excluding the amortization of purchased intangible assets, which
primarily represents technology and/or customer relationships
already developed, it provides an alternative way for investors to
compare our operations pre-acquisition to those post-acquisitions
and to those of our competitors that have pursued internal growth
strategies. However, we note that companies that grow internally
will incur costs to develop intangible assets that will be expensed
in the period incurred, which may make a direct comparison more
difficult.
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( C )
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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 second
quarter and the first two quarters of fiscal years 2016 and 2015,
stock-based compensation was allocated as follows:
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Second Quarter
of
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First Two
Quarters
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(Dollars in
millions)
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2016
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2015
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2016
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2015
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Cost of
sales
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$
0.9
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$
1.0
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$
1.9
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$
1.9
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Research and
development
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2.4
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2.1
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4.7
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4.3
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Sales and
Marketing
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2.2
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2.2
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4.2
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4.5
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General and
administrative
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7.5
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6.7
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15.9
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13.8
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$
13.0
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$
12.0
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$
26.7
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$
24.5
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( D )
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Acquisition /
divestiture items. Included in our GAAP presentation of
operating expenses, acquisition costs consist of external and
incremental costs resulting directly from merger and acquisition
and strategic investment activities such as legal, due diligence,
and integration costs as well as adjustments to the fair value of
earn-out liabilities. Included in our GAAP presentation of
non-operating income (expense), net, acquisition / divestiture
items includes unusual acquisition, investment, or divestiture
gains/losses. Although we do numerous acquisitions, the costs that
have been excluded from the non-GAAP measures are costs specific to
particular acquisitions. These are one-time costs that vary
significantly in amount and timing and are not indicative of our
core operating performance.
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( E )
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Executive
transition costs. Included in our GAAP presentation of
operating expenses are amounts paid to the Company's former CFO
upon his departure under the terms of his executive severance
agreement. We excluded these payments from our non-GAAP measures
because they represent non-recurring expenses and are not
indicative of our ongoing operating expenses. We further believe
that excluding the executive transition costs from our non-GAAP
results is useful to investors in that it allows for
period-over-period comparability.
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( F )
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Debt issuance cost
write-off. Included in our GAAP non-operating
income (expense), net is the write-off of debt issuance costs for
terminated and/or modified credit facilities and costs associated
with the issuance of new credit facilities and Senior Notes in
fiscal 2014 that were not capitalized as debt issuance costs.
We excluded the debt issuance cost write-off from our non-GAAP
measures. We believe that investors benefit from excluding this
item from our non-operating income to facilitate a more meaningful
evaluation of our non-operating income trends.
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( G )
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Non-GAAP items tax
effected. This amount adjusts the provision for
income taxes to reflect the effect of the non-GAAP items ( A ) - (
F ) on non-GAAP net income. We believe this information
is useful to investors because it provides for consistent treatment
of the excluded items in this non-GAAP
presentation.
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( H )
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Difference in GAAP
and Non-GAAP tax rate. This amount represents the
difference between the GAAP and Non-GAAP tax rates applied to the
Non-GAAP operating income plus the Non-GAAP non-operating income
(expense), net.
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( I )
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GAAP and non-GAAP
tax rate %. These percentages are defined as GAAP income
tax provision as a percentage of GAAP income before taxes and
non-GAAP income tax provision as a percentage of non-GAAP income
before taxes. We believe that investors benefit from a
presentation of non-GAAP tax rate percentage as a way of
facilitating a comparison to non-GAAP tax rates in prior
periods.
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To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/trimble-reports-second-quarter-2016-results-300307888.html
SOURCE Trimble