Garmin Reports Strong First Quarter 2016 Sales

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Garmin Ltd. And Subsidiaries
Condensed Consolidated Statements of Income (Unaudited)
(In thousands, except per share information)

	13-Weeks Ended
	Mar 26,		Mar 28,
	2016		2015
Net sales	$624,040		$585,394

Cost of goods sold	284,190		241,272

Gross profit	339,850		344,122

Advertising expense	32,233		27,672
Selling, general and administrative expense	95,610		98,750
Research and development expense	108,204		106,002
Total operating expense	236,047		232,424

Operating income	103,803		111,698

Other income (expense):
Interest income	7,428		8,024
Foreign currency (losses)	(4,839	)	(44,264	)
Other income	1,155		738
Total other income (expense)	3,744		(35,502	)

Income before income taxes	107,547		76,196

Income tax provision	19,455		9,403

Net income	$88,092		$66,793

Net income per share:
Basic	$0.46		$0.35
Diluted	$0.46		$0.35

Weighted average common
shares outstanding:
Basic	189,497		191,762
Diluted	189,651		192,341


Garmin Ltd. And Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands, except per share information)

	(Unaudited)
	Mar 26,		Dec 26,
	2016		2015
Assets
Current assets:
Cash and cash equivalents	$857,679		$833,070
Marketable securities	198,147		215,161
Accounts receivable, net	408,283		531,481
Inventories, net	517,767		500,554
Deferred costs	50,861		49,176
Prepaid expenses and other current assets	96,396		81,645
Total current assets	2,129,133		2,211,087

Property and equipment, net	448,967		446,089

Marketable securities	1,279,799		1,343,387
Restricted cash	261		259
Noncurrent deferred income tax	117,467		116,518
Noncurrent deferred costs	39,663		38,769
Intangible assets, net	306,303		245,552
Other assets	88,731		97,730
Total assets	$4,410,324		$4,499,391

Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable	$137,162		$178,905
Salaries and benefits payable	75,862		70,601
Accrued warranty costs	31,407		30,449
Accrued sales program costs	49,236		67,613
Deferred revenue	154,965		164,982
Accrued royalty costs	25,737		30,310
Accrued advertising expense	20,185		33,547
Other accrued expenses	75,217		74,926
Income taxes payable	14,524		21,674
Dividend payable	96,425		192,991
Total current liabilities	680,720		865,998

Deferred income taxes	60,915		56,210
Non-current income taxes	103,035		101,689
Non-current deferred revenue	126,731		128,731
Other liabilities	1,676		1,637

Stockholders' equity:
Shares, CHF 10 par value, 208,077 shares authorized and issued;
189,193 shares outstanding at March 26, 2016
and 189,722 shares outstanding at December 26, 2015	1,797,435		1,797,435
Additional paid-in capital	70,413		62,239
Treasury stock	(434,346	)	(414,637	)
Retained earnings	2,018,609		1,930,517
Accumulated other comprehensive income	(14,864	)	(30,428	)
Total stockholders' equity	3,437,247		3,345,126
Total liabilities and stockholders' equity	4,410,324		$4,499,391


Garmin Ltd. And Subsidiaries
Condensed Consolidated Statements of Cash Flows (Unaudited)
(In thousands)

		13-Weeks Ended
		Mar 26,		Mar 28,
		2016		2015
Operating Activities:
Net income		$88,092		$66,793
Adjustments to reconcile net income to net cash
provided by operating activities:
	Depreciation	13,078		12,280
	Amortization	7,115		6,584
	Loss on sale or disposal of property and equipment	38		24
	Provision for doubtful accounts	285		(1,080	)
	Deferred income taxes	3,906		(3,647	)
	Unrealized foreign currency (gain) loss	(5,412	)	47,877
	Provision for obsolete and slow moving inventories	8,026		4,344
	Stock compensation expense	8,172		7,769
	Realized gain on marketable securities	(452	)	(340	)
Changes in operating assets and liabilities:
	Accounts receivable	130,036		129,448
	Inventories	(18,873	)	(56,897	)
	Other current and non-current assets	(3,937	)	(11,537	)
	Accounts payable	(45,515	)	(25,957	)
	Other current and non-current liabilities	(31,606	)	(73,408	)
	Deferred revenue	(12,337	)	(29,870	)
	Deferred cost	(2,496	)	6,470
	Income taxes payable	(8,733	)	2,802
Net cash provided by operating activities		129,387		81,655

Investing activities:
Purchases of property and equipment		(13,908	)	(18,143	)
Proceeds from sale of property and equipment		-		664
Purchase of intangible assets		(1,716	)	(717	)
Purchase of marketable securities		(151,070	)	(254,741	)
Redemption of marketable securities		237,464		308,751
Change in restricted cash		(2	)	(5	)
Acquisitions, net of cash acquired		(62,137	)	(12,632	)
Net cash provided by investing activities		8,631		23,177

Financing activities:
Dividends paid		(96,566	)	(91,964	)
Purchase of treasury stock under share repurchase plan		(19,796	)	(16,260	)
Purchase of treasury stock related to equity awards		(16	)	(89	)
Proceeds from issuance of treasury stock related to equity awards		103		246
Tax benefit from issuance of equity awards		2		399
Net cash used in financing activities		(116,273	)	(107,668	)

Effect of exchange rate changes on cash and cash equivalents		2,864		(22,044	)

Net increase (decrease) in cash and cash equivalents		24,609		(24,880	)
Cash and cash equivalents at beginning of period		833,070		1,196,268
Cash and cash equivalents at end of period		$857,679		$1,171,388


Net Sales, Gross Profit, and Operating Income by Segment (Unaudited)
(In thousands)

	Reporting Segments
	Outdoor	Fitness	Marine	Auto	Aviation	Total

13-Weeks Ended March 26, 2016

Net sales	$96,827	$142,418	$82,880	$195,599	$106,316	$624,040
Gross profit	$58,932	$72,294	$44,149	$86,144	$78,331	$339,850
Operating income	$27,885	$16,573	$10,293	$18,566	$30,486	$103,803

13-Weeks Ended March 28, 2015 ⁽³⁾

Net sales	$72,815	$130,994	$64,297	$219,226	$98,062	$585,394
Gross profit	$49,064	$83,075	$35,513	$104,959	$71,511	$344,122
Operating income	$23,770	$34,638	$4,566	$22,544	$26,180	$111,698

(3) Action camera related operating results for the 13-weeks ended March 28, 2015 have been recast from the Outdoor segment to
the Auto segment to conform to the current year presentation.


Garmin Ltd. And Subsidiaries
Net Sales by Geography (Unaudited)
(In thousands)

	13-Weeks Ended
	Mar 26,	Mar 28,	Yr over Yr
	2016	2015	Change
Net sales	$624,040	$585,394	7%
Americas	317,957	305,261	4%
EMEA	225,728	208,351	8%
APAC	80,355	71,782	12%

EMEA - Europe, Middle East and Africa; APAC - Asia Pacific

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