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Trimble's Fourth Quarter Revenue Up 4 Percent and Non-GAAP Operating Income Up 18 Percent as Compared to the Fourth Quarter 2008

SUNNYVALE, Calif., Feb. 2 — (PRNewswire) — Trimble (Nasdaq: TRMB) today announced revenue of $277.5 million for its fourth quarter ended January 1, 2010, up approximately 4 percent from revenue of $268.1 million in the fourth quarter of 2008.

Operating income for the fourth quarter of 2009 was $12.7 million, up approximately 21 percent as compared to the fourth quarter of 2008. Operating margin in the fourth quarter of 2009 was 4.6 percent, as compared to an operating margin of 3.9 percent in the fourth quarter of 2008.

Amortization of intangibles was $13.7 million in the fourth quarter of 2009, as compared to $12.0 million in the fourth quarter of 2008. The impact of stock-based compensation expense was $5.3 million, as compared to $4.6 million in the fourth quarter of 2008. There was also $1.6 million in restructuring expense, no acquisition-related inventory step-up charges, and $0.8 million in non-recurring acquisition costs in the fourth quarter of 2009.  This compares to $0.8 million in restructuring expense, $0.8 million in acquisition-related inventory step-up charges, and no non-recurring acquisition costs in the fourth quarter of 2008.

Excluding these items, non-GAAP operating income of $33.8 million was up 18 percent, as compared to the fourth quarter of 2008. Non-GAAP operating margin was 12.2 percent in the fourth quarter of 2009, as compared to 10.7 percent in the fourth quarter of 2008.

Fourth quarter 2009 net income was $9.5 million, down 31 percent, as compared to the fourth quarter of 2008. Diluted earnings per share for the fourth quarter of 2009 was $0.08, as compared to diluted earnings per share of $0.11 for the fourth quarter of 2008.

Adjusting for the items noted above, non-GAAP net income of $25.3 million for the fourth quarter of 2009 was down 13 percent, as compared to the fourth quarter of 2008. Non-GAAP earnings per share for the fourth quarter of 2009 was $0.21, as compared to non-GAAP earnings per share of $0.24 in the fourth quarter of 2008.  The tax rate for the fourth quarter of 2009 was 27 percent, compared to a tax benefit of 48 percent in the fourth quarter of 2008.  

For the full year 2009, Trimble's revenue was $1.13 billion, down approximately 15 percent from revenue of $1.33 billion in 2008.

Operating income for the full year 2009 was $85.8 million, down approximately 54 percent from 2008. Operating margin in 2009 was 7.6 percent, as compared to operating margin of 14.0 percent in 2008.

Amortization of intangibles was $52.5 million in 2009, as compared to $44.9 million in 2008. The impact of stock-based compensation expense was $18.7 million, as compared to $16.2 million in 2008. There was also $10.8 million in restructuring expense, $0.5 million in acquisition-related inventory step-up charges, and $3.8 million in non-recurring acquisition costs in 2009.  This compares to $4.6 million in restructuring expense, $1.4 million in acquisition-related inventory step-up charges, and no non-recurring acquisition costs in 2008.

Excluding these items, full year non-GAAP operating income of $172.1 million was down 32 percent, as compared to 2008. Full year 2009 non-GAAP operating margin was 15.3 percent in 2009, as compared to 19.0 percent in 2008.

Net income for the full year 2009 was $63.4 million, down 55 percent as compared to 2008. Diluted earnings per share for 2009 was $0.52, as compared to diluted earnings per share of $1.14 in 2008.

Adjusting for the items noted above, non-GAAP net income of $126.5 million for the full year 2009 was down 34 percent, as compared to 2008. Non-GAAP earnings per share for 2009 was $1.04, as compared to non-GAAP earnings per share of $1.54 in 2008.  The tax rate for the full year 2009 was 27 percent, as compared to 26 percent for the full year 2008.  

Cash flow from operations for the full year 2009 was $194.6 million, as compared to $176.1 million in 2008.

"The macroeconomic environment represented a significant challenge for Trimble throughout 2009.  Although difficult, we saw improving stability in the second half of the year which provided us with the opportunity to demonstrate year-over-year progression in the fourth quarter," said Steven W. Berglund, Trimble's president and chief executive officer. "This reinforces our anticipation of meaningful revenue growth in 2010, with strong operating leverage providing the potential to grow earnings significantly faster than revenue.  Trimble employees have distinguished themselves in a historically unprecedented period by confronting the needs of the short term while continuing to develop the platform for future growth.  As a result, our fundamental long-term strategy and financial model remain intact and have not been impaired by the cost reductions taken during the recession," concluded Berglund.  

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)

Fourth quarter 2009 E&C revenue was $154.3 million, up approximately 8 percent as compared to the fourth quarter of 2008, largely due to stronger sales of both survey instruments and machine control products.  

E&C revenue for the full year 2009 was $578.6 million, down approximately 22 percent as compared to 2008 due to recessionary conditions, concentrated in the U.S. and Europe.

Operating income in E&C for the fourth quarter 2009 was $15.5 million, or 10.0 percent of revenue, as compared to $2.3 million, or 1.6 percent of revenue, in the fourth quarter of 2008.  Non-GAAP operating income was $17.5 million, or 11.3 percent of revenue, as compared to $3.9 million, or 2.7 percent of revenue, in the fourth quarter of 2008. The improvement in non-GAAP operating margin was primarily due to year-over-year cost reductions as a result of restructuring in the segment, as well as increased revenue.  

Operating income in E&C for the full year 2009 was $58.3 million, or 10.1 percent of revenue, as compared to $126.0 million, or 17.0 percent of revenue, in 2008.  Non-GAAP operating income was $64.6 million, or 11.2 percent of revenue, as compared to $130.7 million, or 17.6 percent of revenue, in 2008. The decline in non-GAAP operating margin was primarily due to lower revenue.

Field Solutions

Fourth quarter 2009 Field Solutions revenue was $57.2 million, down approximately 2 percent as compared to the fourth quarter of 2008.  

Field Solutions full year 2009 revenue was $291.8 million, down approximately 3 percent as compared to 2008.    

Operating income in Field Solutions for the fourth quarter 2009 was $15.9 million, or 27.8 percent of revenue, as compared to $17.5 million, or 30.1 percent of revenue, in the fourth quarter of 2008.  Non-GAAP operating income was $16.2 million, or 28.3 percent of revenue, as compared to $17.7 million, or 30.5 percent of revenue, in the fourth quarter of 2008.  The decrease in non-GAAP operating margin was due to slightly lower revenue.  

Operating income in Field Solutions for the full year 2009 was $104.5 million, or 35.8 percent of revenue, as compared to $109.5 million, or 36.4 percent of revenue, in 2008.  Non-GAAP operating income was $105.6 million, or 36.2 percent of revenue, as compared to $110.3 million, or 36.7 percent of revenue, in 2008.  

Mobile Solutions

Fourth quarter 2009 Mobile Solutions revenue was $38.0 million, down approximately 5 percent as compared to the fourth quarter of 2008 primarily due to churn among smaller accounts that were impacted by the economic environment throughout the year.  

For the full year 2009 Mobile Solutions revenue was $154.9 million, down approximately 7 percent as compared to 2008 primarily due to reduced sales of ready mix products for construction.

Operating income in Mobile Solutions for the fourth quarter 2009 was $4.2 million, or 11.0 percent of revenue, as compared to $3.3 million, or 8.3 percent of revenue, in the fourth quarter of 2008.  Non-GAAP operating income in Mobile Solutions was $5.2 million, or 13.7 percent of revenue, as compared to $4.5 million, or 11.2 percent of revenue, in the fourth quarter of 2008 due to cost reductions.  

Operating income in Mobile Solutions for the full year 2009 was $14.3 million, or 9.3 percent of revenue, as compared to $11.3 million, or 6.8 percent of revenue, in 2008.  For the full year 2009 non-GAAP operating income in Mobile Solutions was $18.6 million, or 12.0 percent of revenue, as compared to $16.1 million, or 9.6 percent of revenue, in 2008.  Improvements in the non-GAAP operating margin are primarily due to improving operational efficiency.

Advanced Devices

Fourth quarter 2009 Advanced Devices revenue was $28.1 million, up approximately 3 percent as compared to the fourth quarter of 2008.  

Full year 2009 Advanced Devices revenue was $101.0 million, down approximately 16 percent as compared to 2008 due to reduced sales of embedded and aerial survey products.  

Operating income in Advanced Devices for the fourth quarter 2009 was $3.6 million, or 12.8 percent of revenue, as compared to $6.3 million, or 23.3 percent of revenue, in the fourth quarter of 2008.  Non-GAAP operating income in Advanced Devices was $4.1 million, or 14.7 percent of revenue, as compared to $6.7 million, or 24.7 percent of revenue, in the fourth quarter of 2008.  

Operating income in Advanced Devices for the full year 2009 was $17.2 million, or 17.0 percent of revenue, as compared to $24.4 million, or 20.4 percent of revenue, in 2008.  For the full year 2009 non-GAAP operating income in Advanced Devices was $18.8 million, or 18.6 percent of revenue, as compared to $25.8 million, or 21.6 percent of revenue, in 2008.  The reduction in non-GAAP operating margin was due primarily to reduced revenue and product mix.

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 first quarter of 2010 Trimble expects revenue between $308 million and $313 million, with GAAP earnings per share of $0.19 to $0.21 and non-GAAP earnings per share of $0.30 to $0.32. Non-GAAP guidance for the first quarter of 2010 excludes the amortization of intangibles of $14.0 million related to previous acquisitions and the anticipated impact of stock-based compensation expense of $4.9 million. Both GAAP and non-GAAP earnings per share assume a 27 to 29 percent tax rate and 123.5 million shares outstanding.  

Investor Conference Call / Webcast Details

Trimble will hold a conference call on Feb. 2, 2010 at 1:30 p.m. PT to review its fourth quarter 2009 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 (706) 634-6089 (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 51195518. 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 Trimble's Web site at 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 the operating margins, revenue, and earnings per share that Trimble has guided for the first quarter and full year 2010, changes in tax-rate, the anticipated impact of stock-based compensation expense and the amortization of intangibles related to previous acquisitions.  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 in the U.S. and Europe worsen or do not improve 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.  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    Twelve Months Ended  
                                  ------------------    -------------------  
                                                                             
                                    Jan-1,    Jan-2,      Jan-1,      Jan-2,
                                     2010      2009        2010        2009 
                                     ----      ----        ----        ---- 
                                                                             
    Revenue                       $277,529  $268,084  $1,126,259  $1,329,234 
    Cost of sales                  146,877   146,046     576,391     680,098 
                                   -------   -------     -------     ------- 
    Gross margin                   130,652   122,038     549,868     649,136 
                                   -------   -------     -------     ------- 
    Gross margin (%)                  47.1%     45.5%       48.8%       48.8%
                                                                             
    Operating expenses                                                       
        Research and development    35,795    36,167     136,639     148,265 
        Sales and marketing         48,739    44,564     189,859     196,290 
        General and administrative  24,929    23,972     100,830      94,023 
        Restructuring                  588       287       6,385       2,722 
        Amortization of purchased                                            
         intangible assets           7,924     6,608      30,335      22,376 
                                     -----     -----      ------      ------ 
           Total operating                                                   
            expenses               117,975   111,598     464,048     463,676 
                                   -------   -------     -------     ------- 
                                                                             
                                                                             
    Operating income                12,677    10,440      85,820     185,460 
                                                                             
    Non-operating income (loss), net                                         
        Interest income                237       675         783       2,044 
        Interest expense              (404)   (1,371)     (1,812)     (2,760)
        Foreign currency                                                     
         transaction gain (loss), net (297)     (829)        463       1,509 
        Income from joint                                                    
         ventures, net                  60     1,185         429       7,981 
        Other income (expense), net    410    (1,130)      1,938      (2,791)
                                       ---    ------       -----      ------ 
           Total non-operating                                               
            income (loss), net           6    (1,470)      1,801       5,983 
                                         -    ------       -----       ----- 
                                                                             
    Income before taxes             12,683     8,970      87,621     191,443 
                                                                             
    Income tax provision             3,414    (4,270)     23,658      50,470 
                                     -----    ------      ------      ------ 
    Net income                       9,269    13,240      63,963     140,973 
      Less: Net income (loss)                                                
       attributable to                                                       
       noncontrolling interests       (278)     (499)        517        (499)
                                      ----      ----         ---        ---- 
    Net income attributable to                                               
     Trimble Navigation Ltd.        $9,547   $13,739     $63,446    $141,472 
                                    ======   =======     =======    ======== 
                                                                             
    Earnings per share attributable
     to Trimble Navigation Ltd.                                               
         Basic                       $0.08     $0.12       $0.53       $1.17 
                                     -----     -----       -----       ----- 
         Diluted                     $0.08     $0.11       $0.52       $1.14 
                                     -----     -----       -----       ----- 
                                                                             
    Shares used in calculating                                               
     earnings per share:                                                     
        Basic                      120,395   119,342     119,814     120,714 
                                   -------   -------     -------     ------- 
        Diluted                    123,155   121,728     122,208     124,235 
                                   -------   -------     -------     ------- 
    
    
    
    
    
                   CONDENSED CONSOLIDATED BALANCE SHEETS               
                               (In thousands)                          
                                (Unaudited)                            
                                                                       
                                                                       
                                                     Jan-1,     Jan-2, 
                                                      2010       2009
                                                      ----       ----
    Assets                                                             
                                                                       
    Current assets:                                                    
       Cash and cash equivalents                    $273,848   $142,531
       Short-term investments                              -      5,000
       Accounts receivables, net                     202,293    204,269
       Other receivables                              11,856     17,540
       Inventories, net                              144,012    160,893
       Deferred income taxes                          39,686     41,810
       Other current assets                           18,383     16,404
                                                      ------     ------
          Total current assets                       690,078    588,447
                                                                       
    Property and equipment, net                       44,635     50,175
    Goodwill                                         764,193    715,571
    Other purchased intangible assets, net           202,782    228,901
    Other non-current assets                          51,589     51,922
                                                      ------     ------
                                                                       
          Total assets                            $1,753,277 $1,635,016
                                                  ========== ==========
                                                                       
    Liabilities                                                        
                                                                       
    Current liabilities:                                               
       Current portion of long-term debt                $445       $124
       Accounts payable                               53,775     49,611
       Accrued compensation and benefits              43,272     41,291
       Deferred revenue                               68,968     55,241
       Accrued warranty expense                       14,744     13,332
       Other accrued liabilities                      42,041     63,719
                                                      ------     ------
          Total current liabilities                  223,245    223,318
                                                                       
    Non-current portion of long-term debt            151,038    151,464
    Non-current deferred revenue                      15,599     12,418
    Deferred income taxes                             38,857     42,207
    Other non-current liabilities                     59,983     61,553
                                                      ------     ------
          Total liabilities                          488,722    490,960
                                                     -------    -------
                                                                       
    Commitments and contingencies                                      
                                                                       
    Equity                                                             
                                                                       
    Shareholders' equity:                                              
       Common stock                                  720,248    684,831
       Retained earnings                             491,368    427,921
       Accumulated other comprehensive income         48,296     27,649
                                                      ------     ------
    Total Trimble Navigation Ltd. shareholders'                        
     equity                                        1,259,912  1,140,401
    Noncontrolling interests                           4,643      3,655
                                                       -----      -----
          Total equity                             1,264,555  1,144,056
                                                                       
          Total liabilities and equity            $1,753,277 $1,635,016
                                                  ========== ==========
    
    
    
    
    
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS              
                                  (In thousands)                              
                                    (Unaudited) 
                                 
                                                              Twelve Months 
                                                                  Ended    
                                                             ---------------
                                                             Jan-1,    Jan-2,
                                                              2010      2009 
                                                              ----      ---- 
                                                                              
    Cash flow from operating activities:                                      
        Net Income                                          $63,963  $140,973 
                                                                              
        Adjustments to reconcile net income  to net cash                      
         provided by operating activities:                                    
                                                                              
             Depreciation expense                            18,795    19,047 
             Amortization expense                            52,672    45,066 
             Provision for doubtful accounts                  4,139     2,709 
             Amortization of debt issuance cost                 226       169 
             Deferred income taxes                           (7,473)  (17,356)
             Stock-based compensation                        18,659    16,166 
             Equity gain from joint ventures                   (429)   (7,981)
             Excess tax benefit for stock-based compensation (1,453)   (5,970)
             Provision for excess and obsolete inventories    3,530     4,426 
             Other non-cash items                            (3,036)      151 
                                                                              
        Add decrease (increase) in assets:                                    
             Accounts receivables                            (3,935)   33,414 
             Other receivables                                3,516    (7,422)
             Inventories                                     13,292   (16,461)
             Other current and non-current assets              (620)      779 
                                                                              
        Add increase (decrease) in liabilities:                               
             Accounts payable                                 2,631   (20,898)
             Accrued compensation and benefits                  245   (12,487)
             Accrued liabilities                              4,433     3,069 
             Deferred revenue                                25,476    (1,320)
                                                             ------    ------ 
     Net cash provided by operating activities              194,631   176,074 
                                                            -------   ------- 
                                                                              
     Cash flow from investing activities:                                     
          Acquisitions of businesses, net of cash acquired  (52,018) (115,137)
          Acquisition of property and equipment             (12,706)  (16,196)
          Acquisitions of intangible assets                 (26,839)        - 
          Net maturities of short-term investments            5,000    (5,000)
          Investment in joint venture                          (750)        - 
          Capital infusion from minority investor                 -     4,200 
          Dividends received                                  2,896    10,648 
          Other                                                 491    (5,211)
                                                                ---    ------ 
     Net cash used in investing activities                  (83,926) (126,696)
                                                            -------  -------- 
                                                                              
     Cash flow from financing activities:                                     
          Issuance of common stock                           14,855    22,802 
          Excess tax benefit for stock-based compensation     1,453     5,970 
          Repurchase and retirement of common stock               -  (125,888)
            Proceeds from long-term debt and revolving                        
            credit lines                                          -   151,000 
           Payments on long-term debt and revolving credit                    
           lines                                               (183)  (60,314)
          Other                                                   -       (11)
                                                                ---       --- 
     Net cash provided by (used in) financing activities     16,125    (6,441)
                                                             ------    ------ 
                                                                              
      Effect of exchange rate changes on cash and cash                        
      equivalents                                             4,487    (3,608)
                                                              -----    ------ 
                                                                              
     Net increase in cash and cash equivalents              131,317    39,329 
     Cash and cash equivalents - beginning of period        142,531   103,202 
                                                            -------   ------- 
                                                                              
     Cash and cash equivalents - end of period             $273,848  $142,531 
                                                           ========  ======== 
    
    
    
    
    
                                REPORTING SEGMENTS                            
                              (Dollars in thousands)                          
                                    (Unaudited)                               
                                                                              
                                                                              
                                              Reporting Segments              
                                              ------------------              
                                  Engineering                                 
                                      and        Field      Mobile   Advanced 
                                 Construction  Solutions  Solutions   Devices 
                                 ------------  ---------  ---------   ------- 
                                                                              
    THREE MONTHS ENDED JANUARY 1,                                             
     2010:                                                                    
      Revenue                        $154,304    $57,154    $37,956   $28,115 
                                                                              
      Operating income before                                                 
       corporate allocations:         $15,482    $15,861     $4,178    $3,594
        Operating margin (% of
         segment external net
         revenues)                       10.0%      27.8%      11.0%     12.8%
                                                                              
    THREE MONTHS ENDED JANUARY 2,                                          
     2009:                                                                    
      Revenue                        $142,611    $58,247    $39,995   $27,231 
                                                                              
      Operating income before                                                 
       corporate allocations:          $2,339    $17,528     $3,331    $6,340 
        Operating margin (% of 
         segment external net
         revenues)                        1.6%      30.1%       8.3%     23.3%
                                                                              
    TWELVE MONTHS ENDED JANUARY 1,                                        
     2010:                                                                    
      Revenue                        $578,579   $291,752   $154,881  $101,047 
                                                                              
      Operating income before                                                 
       corporate allocations:         $58,282   $104,498    $14,341   $17,227 
        Operating margin (% of
         segment external net
         revenues)                       10.1%      35.8%       9.3%     17.0%
                                                                              
    TWELVE MONTHS ENDED JANUARY 2,                                            
     2009:                                                                    
      Revenue                        $741,668   $300,708   $167,113  $119,745 
                                                                              
      Operating income before                                                 
       corporate allocations:        $126,014   $109,489    $11,328   $24,445 
        Operating margin (% of
         segment external net
         revenues)                       17.0%      36.4%       6.8%     20.4%
    
    
    
    
    
                            GAAP TO NON-GAAP RECONCILIATION
                     (Dollars in thousands, except per share data)
                                     (Unaudited)
    
                                               Three Months Ended
                                               ------------------
                                            Jan-1,             Jan-2,
                                             2010               2009
                                             ----               ----
                                     Dollar       % of     Dollar    % of
                                     Amount      Revenue   Amount   Revenue
                                     ------      -------   ------   -------
    GROSS MARGIN:
      GAAP gross margin:           $130,652        47.1% $122,038     45.5%
        Restructuring      ( A )      1,036         0.3%      559      0.2%
        Amortization of
         purchased
         intangibles       ( B )      5,780         2.1%    5,418      2.0%
        Stock-based
         compensation      ( C )        486         0.2%      487      0.2%
        Amortization of
         acquisition-
         related inventory
         step-up           ( D )          -         0.0%      813      0.3%
                                        ---         ---       ---      ---
      Non-GAAP gross margin:       $137,954        49.7% $129,315     48.2%
                                   --------        ----  --------     ----
    
    OPERATING EXPENSES:
      GAAP operating
       expenses:                   $117,975              $111,598
        Restructuring      ( A )       (588)                 (287)
        Amortization of
         purchased
         intangibles       ( B )     (7,924)               (6,608)
        Stock-based
         compensation      ( C )     (4,852)               (4,076)
        Non-recurring
         acquisition costs ( E )       (440)                    -
                                       ----                   ---
      Non-GAAP operating expenses: $104,171              $100,627
                                   --------              --------
    
    OPERATING INCOME:
      GAAP operating
       income:                      $12,677         4.6%  $10,440      3.9%
        Restructuring      ( A )      1,624         0.6%      846      0.3%
        Amortization of
         purchased
         intangibles       ( B )     13,704         4.9%   12,026      4.5%
        Stock-based
         compensation      ( C )      5,338         1.9%    4,563      1.7%
        Amortization of
         acquisition-
         related inventory
         step-up           ( D )          -         0.0%      813      0.3%
        Non-recurring
         acquisition costs ( E )        440         0.2%        -      0.0%
                                        ---         ---       ---      ---
      Non-GAAP operating income:    $33,783        12.2%  $28,688     10.7%
                                    -------        ----   -------     ----
    
    NET INCOME:
      GAAP net income attributable
       to Trimble Navigation Ltd.    $9,547               $13,739
        Restructuring      ( A )      1,624                   846
        Amortization of
         purchased
         intangibles       ( B )     13,704                12,026
        Stock-based
         compensation      ( C )      5,338                 4,563
        Amortization of
         acquisition-
         related inventory
         step-up           ( D )          -                   813
        Non-recurring
         acquisition costs ( E )        826                     -
        Income tax effect
         on non-GAAP
         adjustments       ( F )     (5,785)               (3,029)
                                     ------                ------
      Non-GAAP net income
       attributable to Trimble
       Navigation Ltd.              $25,254               $28,958
                                    -------               -------
    
    DILUTED NET INCOME PER SHARE:
      GAAP diluted net income
       per share attributable to
       Trimble Navigation Ltd.        $0.08                 $0.11
        Restructuring      ( A )       0.01                  0.01
        Amortization of
         purchased
         intangibles       ( B )       0.11                  0.10
        Stock-based
         compensation      ( C )       0.05                  0.04
        Amortization of
         acquisition-
         related inventory
         step-up           ( D )          -                  0.01
        Non-recurring
         acquisition costs ( E )       0.01                     -
        Income tax effect
         on non-GAAP
         adjustments       ( F )      (0.05)                (0.03)
                                      -----                 -----
      Non-GAAP diluted net income
       per share attributable to
       Trimble Navigation Ltd.        $0.21                 $0.24
                                      -----                 -----
    
    OPERATING LEVERAGE:
      Increase (decrease) in
       non-GAAP operating income     $5,095
      Increase (decrease) in revenue $9,445
      Operating leverage (increase
       in non-GAAP operating income
       as a % of increase in revenue)  53.9%
    
                                                  % of               % of
                                                 Segment            Segment
    SEGMENT OPERATING INCOME:                    Revenue            Revenue
                                                 -------            -------
      Engineering and Construction
        GAAP operating income
         before corporate
         allocations:               $15,482        10.0%   $2,339      1.6%
          Stock-based
           compensation    ( G )      2,010         1.3%    1,533      1.1%
                                      -----         ---     -----      ---
        Non-GAAP operating income
         before corporate
         allocations:               $17,492        11.3%   $3,872      2.7%
                                    -------        ----    ------      ---
    
      Field Solutions
        GAAP operating income
         before corporate
         allocations:               $15,861        27.8%  $17,528     30.1%
          Stock-based
           compensation    ( G )        311         0.5%      221      0.4%
                                        ---         ---       ---      ---
        Non-GAAP operating income
         before corporate
         allocations:               $16,172        28.3%  $17,749     30.5%
                                    -------        ----   -------     ----
    
      Mobile Solutions
        GAAP operating income before
         corporate allocations:      $4,178        11.0%   $3,331      8.3%
          Stock-based
           compensation    ( G )      1,011         2.7%    1,167      2.9%
                                      -----         ---     -----      ---
        Non-GAAP operating income
         before corporate
         allocations:                $5,189        13.7%   $4,498     11.2%
                                     ------        ----    ------     ----
    
      Advanced Devices
        GAAP operating income before
         corporate allocations:      $3,594        12.8%   $6,340     23.3%
          Stock-based
           compensation    ( G )        527         1.9%      399      1.4%
                                        ---         ---       ---      ---
        Non-GAAP
         operating income
         before corporate
         allocations:                $4,121        14.7%   $6,739     24.7%
                                     ------        ----    ------     ----
    
    
                                                Twelve Months Ended
                                                -------------------
                                           Jan-1,              Jan-2,
                                            2010                2009
                                            ----                ----
                                                 % of                % of
                                                Revenue             Revenue
                                                -------             -------
    GROSS MARGIN:
      GAAP gross margin:          $549,868        48.8% $649,136      48.8%
        Restructuring                4,369         0.4%    1,919       0.1%
        Amortization of
         purchased intangibles      22,201         2.0%   22,515       1.7%
        Stock-based compensation     1,854         0.2%    1,920       0.2%
        Amortization of
         acquisition-related
         inventory step-up             470         0.0%    1,414       0.1%
                                       ---         ---     -----       ---
      Non-GAAP gross margin:      $578,762        51.4% $676,904      50.9%
                                  --------        ----  --------      ----
    
    OPERATING EXPENSES:
      GAAP operating expenses:    $464,048              $463,676
        Restructuring               (6,385)               (2,722)
        Amortization of
         purchased intangibles     (30,335)              (22,376)
        Stock-based compensation   (16,805)              (14,246)
        Non-recurring
         acquisition costs          (3,822)                    -
                                    ------                   ---
      Non-GAAP operating
       expenses:                  $406,701              $424,332
                                  --------              --------
    
    OPERATING INCOME:
      GAAP operating income:       $85,820         7.6% $185,460      14.0%
        Restructuring               10,754         1.0%    4,641       0.3%
        Amortization of
         purchased intangibles      52,536         4.7%   44,891       3.4%
        Stock-based compensation    18,659         1.7%   16,166       1.2%
        Amortization of
         acquisition-related
         inventory step-up             470         0.0%    1,414       0.1%
        Non-recurring
         acquisition costs           3,822         0.3%        -       0.0%
                                     -----         ---       ---       ---
      Non-GAAP operating income:  $172,061        15.3% $252,572      19.0%
                                  --------        ----  --------      ----
    
    NET INCOME:
      GAAP net income attributable
       to Trimble Navigation Ltd.  $63,446              $141,472
        Restructuring               10,754                 4,641
        Amortization of
         purchased intangibles      52,536                44,891
        Stock-based compensation    18,659                16,166
        Amortization of
         acquisition-related
         inventory step-up             470                 1,414
        Non-recurring
         acquisition costs           3,822                     -
        Income tax effect on
         non-GAAP adjustments      (23,196)              (17,649)
                                   -------               -------
      Non-GAAP net income
       attributable to Trimble
       Navigation Ltd.            $126,491              $190,935
                                  --------              --------
    
    DILUTED NET INCOME PER SHARE:
      GAAP diluted net income
       per share attributable
       to Trimble Navigation
       Ltd.                          $0.52                 $1.14
        Restructuring                 0.09                  0.04
        Amortization of
         purchased intangibles        0.43                  0.36
        Stock-based compensation      0.15                  0.13
        Amortization of
         acquisition-related
         inventory step-up            0.01                  0.01
        Non-recurring
         acquisition costs            0.03                     -
        Income tax effect on
         non-GAAP adjustments        (0.19)                (0.14)
                                     -----                 -----
      Non-GAAP diluted net
       income per share
       attributable to Trimble
       Navigation Ltd.               $1.04                 $1.54
                                     -----                 -----
    
    OPERATING LEVERAGE:
      Increase (decrease) in
       non-GAAP operating
       income                     $(80,511)
      Increase (decrease) in
       revenue                   $(202,975)
      Operating leverage
       (increase in non-GAAP
       operating income as a %
       of increase in revenue)         N/A
    
                                                 % of                % of
                                                Segment             Segment
    SEGMENT OPERATING INCOME:                   Revenue             Revenue
                                                -------             -------
      Engineering and Construction
        GAAP operating income
         before corporate
         allocations:              $58,282        10.1% $126,014      17.0%
          Stock-based compensation   6,312         1.1%    4,726       0.6%
                                     -----         ---     -----       ---
        Non-GAAP operating
         income before corporate
         allocations:              $64,594        11.2% $130,740      17.6%
                                   -------        ----  --------      ----
    
      Field Solutions
        GAAP operating income
         before corporate
         allocations:             $104,498        35.8% $109,489      36.4%
          Stock-based compensation   1,086         0.4%      821       0.3%
                                     -----         ---       ---       ---
        Non-GAAP operating
         income before corporate
         allocations:             $105,584        36.2% $110,310      36.7%
                                  --------        ----  --------      ----
    
      Mobile Solutions
        GAAP operating income
         before corporate
         allocations:              $14,341         9.3%  $11,328       6.8%
          Stock-based compensation   4,216         2.7%    4,749       2.8%
                                     -----         ---     -----       ---
        Non-GAAP operating
         income before corporate
         allocations:              $18,557        12.0%  $16,077       9.6%
                                   -------        ----   -------       ---
    
      Advanced Devices
        GAAP operating income
         before corporate
         allocations:              $17,227        17.0%  $24,445      20.4%
          Stock-based compensation   1,595         1.6%    1,378       1.2%
                                     -----         ---     -----       ---
        Non-GAAP operating
         income before corporate
         allocations:              $18,822        18.6%  $25,823      21.6%
                                   -------        ----   -------      ----
    
    
    
    
    
             FOOTNOTES TO GAAP TO NON-GAAP RECONCILIATION         
                        (Dollars in thousands)                    
                              (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 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 and non-recurring acquisition costs,
    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
           they are 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 determined in 
           accordance with SFAS 123(R).  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 twelve months ended 
           January 1, 2010 and January 2, 2009, stock-based compensation was 
           allocated as follows:     
                                                                  
                                      Three Months  Twelve Months 
                                          Ended          Ended    
                                      ------------  ------------- 
                                      Jan-1, Jan-2,  Jan-1,  Jan-2,
                                       2010   2009    2010    2009
                                       ----   ----    ----    ----
        Cost of sales                  $486   $487  $1,854  $1,920
        Research and development        972    860   3,476   3,489
        Sales and Marketing           1,246  1,095   4,446   3,993
        General and administrative    2,634  2,121   8,883   6,764
                                      -----  -----   -----   -----
                                     $5,338 $4,563 $18,659 $16,166
                                     ------ ------ ------- -------
                                                                  
    ( 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 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 indentifiable net assets
           acquired exceeding the consideration transferred) and payments made
           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.     
                                                                  
    ( G )  Stock-based Compensation. The amounts consist of expenses for 
           employee stock options and awards and purchase rights under our 
           employee stock purchase plan determined in accordance with SFAS 
           123(R). 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 to understand the 
           impact of the application of SFAS 123(R) to our results of 
           operations.  Stock-based compensation not allocated to the 
           reportable segments was approximately $1,479K and $1,243K for the 
           three months ended January 1, 2010 and January 2, 2009, 
           respectively and $5,450K and $4,492K for the twelve months ended 
           January 1, 2010 and January 2, 2009, respectively. "    
    
    
    

SOURCE Trimble

Contact:
Trimble
Investor Relations, Willa McManmon
Phone: +1-408-481-7838
Email Contact
Media, Lea Ann McNabb
Phone: +1-408-481-7808
Email Contact both of Trimble
Web: http://www.trimble.com