Pro forma net income (earnings) per share
Management believes that net income (earnings) per share before the impact of foreign currency gains or losses and certain discrete income tax items, as discussed above, is an important measure in order to permit a consistent comparison of the Company’s performance between periods.
| Garmin Ltd. And Subsidiaries | |||||||||||||||||
| Pro Forma Net Income (Earnings) Per Share | |||||||||||||||||
| (in thousands, except per share information) | |||||||||||||||||
| 13-Weeks Ended | 26-Weeks Ended | ||||||||||||||||
| June 30, | July 1, | June 30, | July 1, | ||||||||||||||
| 2018 | 2017 | 2018 | 2017 | ||||||||||||||
| Net income (GAAP) | $ | 190,342 | $ | 176,979 | $ | 319,715 | $ | 415,382 | |||||||||
| Foreign currency gains / losses (1) | (2,647 | ) | (15,110 | ) | (3,463 | ) | 22,387 | ||||||||||
| Tax effect of foreign currency gains / losses (2) | 513 | 3,229 | 624 | (4,773 | ) | ||||||||||||
| Pro forma discrete tax items (3) | - | 7,275 | - | (161,480 | ) | ||||||||||||
| Net income (Pro Forma) | $ | 188,208 | $ | 172,373 | $ | 316,876 | $ | 271,516 | |||||||||
| Net income per share (GAAP): | |||||||||||||||||
| Basic | $ | 1.01 | $ | 0.94 | $ | 1.70 | $ | 2.21 | |||||||||
| Diluted | $ | 1.00 | $ | 0.94 | $ | 1.69 | $ | 2.20 | |||||||||
| Net income per share (Pro Forma): | |||||||||||||||||
| Basic | $ | 1.00 | $ | 0.92 | $ | 1.68 | $ | 1.44 | |||||||||
| Diluted | $ | 0.99 | $ | 0.91 | $ | 1.67 | $ | 1.44 | |||||||||
| Weighted average common shares outstanding: | |||||||||||||||||
| Basic | 188,542 | 187,757 | 188,432 | 187,974 | |||||||||||||
| Diluted | 189,461 | 188,492 | 189,377 | 188,691 | |||||||||||||
|
(1) |
The majority of the Company’s consolidated foreign currency gains and losses are driven by movements in the Taiwan Dollar, Euro, and British Pound Sterling in relation to the U.S. Dollar and the related exchange rate impact on the significant cash, receivables, and payables held in a currency other than the functional currency at one of the Company’s subsidiaries. However, there is minimal cash impact from such foreign currency losses. |
|
|
(2) |
The tax effect of foreign currency gains and losses was calculated using the effective tax rate of 19.4% and 18.0% for the quarter and year-to-date ended June 30, 2018, respectively, and a pro forma effective tax rate of 21.4% and 21.3% for the quarter and year-to-date ended July 1, 2017, respectively. |
|
|
(3) |
The discrete tax items are discussed in the pro forma effective tax rate section above. |
|
