- Earnings per share exceed guidance

SUNNYVALE, Calif., May 6, 2020 — (PRNewswire) — Trimble Inc. (NASDAQ: TRMB) today announced financial results for the first quarter of 2020.

First Quarter 2020 Financial Summary

First quarter 2020 GAAP revenue of $792.3 million was down 1 percent as compared to the first quarter of 2019. First quarter 2020 non-GAAP revenue of $794.0 million was down 1 percent as compared to the first quarter of 2019.

Buildings and Infrastructure revenue was $296.9 million, up 1 percent. Geospatial revenue was $146.2 million, down 9 percent. Resources and Utilities revenue was $180.3 million, up 13 percent. Transportation revenue was $170.6 million, down 10 percent.

GAAP operating income was $98.3 million, up 14 percent as compared to the first quarter of 2019. GAAP operating margin was 12.4 percent of revenue as compared to 10.8 percent of revenue in the first quarter of 2019.

GAAP net income was $61.9 million, down 1 percent as compared to the first quarter of 2019. GAAP diluted earnings per share were both $0.25 in the first quarter of 2020 and 2019.

Non-GAAP operating income of $161.2 million was up 4 percent as compared to the first quarter of 2019. Non-GAAP operating margin was 20.3 percent of revenue as compared to 19.4 percent of revenue in the first quarter of 2019.

Non-GAAP net income of $122.5 million was up 8 percent as compared to the first quarter of 2019. Non-GAAP diluted earnings per share were $0.49 as compared to non-GAAP diluted earnings per share of $0.45 in the first quarter of 2019.

The GAAP tax rate for the quarter was 22.0 percent as compared to 17.0 percent in the first quarter of 2019, and the non-GAAP tax rate was 17.5 percent as compared to 20.0 percent in the first quarter of 2019.

Operating cash flow for the first quarter of 2020 was $155.7 million, up 5 percent as compared to the first quarter of 2019. Deferred revenue for the first quarter of 2020 was $551.5 million, up 19 percent as compared to the first quarter of 2019.

During the first quarter, Trimble repurchased approximately 1.2 million shares of its common stock for $50 million. Given the current environment, the Company has suspended further stock repurchases.

"During these unprecedented times, the health and safety of our employees, dealers, partners, and customers is our first priority," said Rob Painter, Trimble's president and chief executive officer. "Our businesses remain essential and we are fully committed to achieving our purpose, to transform the way the world works, and to leverage technology to bring productivity and connectivity to our end markets. In today's distributed and remote work environments, now more than ever technology can be used to help our customers complete and coordinate tasks, increase productivity, and achieve more in their daily work. We have taken decisive action to ensure safe working environments and to enhance our financial position, which will enable us to stay focused on our Connect & Scale 2025 strategy."

Forward Looking Guidance

Trimble's financial results for the remainder of 2020 will be impacted by continued global economic uncertainty due to the COVID-19 pandemic. As such, Trimble is not providing a financial outlook for the second quarter of 2020 or the remainder of 2020 at this time.

Investor Conference Call / Webcast Details

Trimble will hold a conference call on May 6 at 2:00 p.m. PT to review its first quarter 2020 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 (833) 644-0704 (U.S.) or (469) 565-9962 (international). The passcode is 7189788. The replay will also be available on the web at the address above.

Use of Non-GAAP Financial Information

In addition to financial information prepared in accordance with GAAP, this press release also contains certain non-GAAP financial measures based upon management's view of performance, including:

• Non-GAAP revenue
• Non-GAAP recurring revenue
• Non-GAAP operating income
• Non-GAAP operating margin
• Non-GAAP net income
• Non-GAAP diluted earnings per share
• Non-GAAP tax rate

Trimble uses Non-GAAP Recurring Revenue as a component of its performance measure annualized recurring revenue (ARR) in order to provide investors with a supplementary indicator of the value of the Company's current recurring revenue contracts. For the first quarter of 2020, recurring revenue on a GAAP basis was $284.9 million, and non-GAAP recurring revenue was $285.6 million, which excluded $0.7 million related to the elimination of the deferred revenue adjustment in connection with acquisitions.

Segment data reflects the results of Trimble's reportable segments under its management reporting system. Segment revenue and operating income are consistent with the respective non-GAAP measures discussed below and in the attached supplemental schedules. Investors are encouraged to review the specific non-GAAP measures, which Trimble uses 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 the financial condition and results of operations and why management chose to exclude selected items, which can be found at the end of this press release. Additional financial information about Trimble's use of non-GAAP results can be found on the investor relations section of Trimble's website at:  http://investor.trimble.com.

Annualized Recurring Revenue

In addition to providing financial measures, Trimble provides an annualized recurring revenue performance measure. ARR is calculated by dividing Non-GAAP recurring revenue for the current quarter by the number of days in the quarter, and multiplying by 365. ARR should be viewed independently of revenue and deferred revenue as it is a performance measure and is not intended to be combined with or to replace either of those items.

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 industries such as agriculture, construction, geospatial and transportation. 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 about the impact of the COVID-19 pandemic, including impacts upon our financial or operational results, for future financial market and global or local economic conditions, the Company's ongoing transition to recurring revenue business models, the ability to deliver revenue, earnings per share and other financial projections, including the expected tax rate, anticipated impact of stock-based compensation expense, amortization of intangibles related to previous acquisitions, anticipated acquisition costs, debt issuance costs, restructuring charges, the anticipated number of diluted shares outstanding, and the Company's long-term growth targets and operating margins. These forward-looking statements are subject to change, and actual results may materially differ due to certain risks and uncertainties. Trimble's expected tax rate and current expected income are based on the Company's current tax structure, including where the Company's assets are deemed to reside for tax purposes, and current tax law, including current interpretations of recent US tax reform legislation, and may be affected by evolving interpretations of these laws, the resolution of issues arising from tax audits with various tax authorities, and the ability to realize deferred tax assets. The Company's results may be adversely affected if the Company is unable to market, manufacture and ship new products, obtain new customers, or effectively integrate new acquisitions. The Company's results would also be negatively impacted by further deterioration in economic conditions as a result of the COVID-19 pandemic, adverse geopolitical developments, further weakening in the macro environment, foreign exchange fluctuations, critical part supply chain shortages, the imposition of barriers to international trade, and a further softening in the agricultural or oil & gas sectors. Any failure to achieve predicted results could negatively impact the Company's revenue, 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. Undue reliance should not be placed on any forward-looking statement contained herein. 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

 

 

 

 

FOOTNOTES TO GAAP TO NON-GAAP RECONCILIATION

To help investors understand Trimble's past financial performance and future results, as well as its performance relative to competitors, Trimble supplements the financial results that the Company provides in accordance with generally accepted accounting principles, or GAAP, with non-GAAP financial measures. These non-GAAP measures can be used to evaluate Trimble's historical and prospective financial performance, as well as its performance relative to competitors. The Company's management regularly uses supplemental non-GAAP financial measures internally to understand, manage, and evaluate the business, and to make operating decisions. These non-GAAP measures are among the primary factors management uses in planning for and forecasting future periods. Trimble believes that these non-GAAP financial measures reflect an additional way of viewing aspects of the Company's operations that, when viewed with GAAP results, provide a more complete understanding of factors and trends affecting the business. Further, Trimble believes some of the Company's investors track "core operating performance" as a means of evaluating performance in the ordinary, ongoing, and customary course of the Company's 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 Trimble's core operating performance provides a supplemental way to provide consistency in period to period comparisons.

The method the Company uses to produce non-GAAP results is not computed according to GAAP and may differ from the methods used by other companies including industry peer companies, limiting the usefulness of these measures for comparative purposes.

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 Trimble's consolidated financial statements prepared in accordance with GAAP. 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 revenue

We believe this measure helps investors understand the performance of our business, as non-GAAP revenue excludes the effects of certain acquired deferred revenue that was written down to fair value in purchase accounting. Management believes that excluding fair value purchase accounting adjustments more closely correlates with the ordinary and ongoing course of the acquired company's operations and facilitates analysis of revenue growth and business trends.

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 the effects of acquired deferred revenue that was written down to fair value in purchase accounting, restructuring charges, amortization of purchased intangible assets, stock-based compensation, deferred compensation, and acquisition/divestiture items associated with the acceleration of acquisition stock options from GAAP gross margin. We believe that these adjustments 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 charges, COVID-19 expenses, amortization of purchased intangible assets, stock-based compensation, deferred compensation, and acquisition/divestiture items associated with external and incremental costs resulting directly from merger and acquisition activities such as: legal, due diligence, integration, and other costs including the acceleration of acquisition stock options, adjustment to the fair value of earn-out liabilities, and the effects of certain acquired capitalized commissions that were eliminated in purchase accounting from GAAP operating expenses. We believe that these adjustments 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 the effects of purchase accounting adjustments to certain acquired deferred revenue and acquired capitalized commissions, restructuring charges, COVID-19 expenses, amortization of purchased intangible assets, stock-based compensation, deferred compensation, and acquisition/divestiture items from GAAP operating income. We believe that these adjustments offer an alternative means for our investors to evaluate current operating performance compared to results of other periods.

Non-GAAP non-operating expense, net

We believe this measure helps investors evaluate our non-operating income trends. Non-GAAP non-operating expense, net, excludes deferred compensation, acquisition/divestiture gains/losses associated with unusual acquisition related items such as intangible asset impairment charges, gains or losses related to the acquisitions or sale of certain businesses and investments. 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 the effects of purchase accounting adjustments to certain acquired deferred revenue and acquired capitalized commissions, restructuring charges, COVID-19 expenses, amortization of purchased intangible assets, stock-based compensation, deferred compensation, acquisition/divestiture items, and non-GAAP tax adjustments from GAAP net income. We believe our investors benefit from understanding these adjustments 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 the effects of purchase accounting adjustments to certain acquired deferred revenue and acquired capitalized commissions, restructuring charges, COVID-19 expenses, amortization of purchased intangible assets, stock-based compensation, deferred compensation, acquisition/divestiture items, and non-GAAP tax adjustments from GAAP diluted net income per share. We believe that these adjustments 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 the effects of purchase accounting adjustments to certain acquired deferred revenue and acquired capitalized commissions, restructuring charges, COVID-19 expenses, amortization of purchased intangible assets, stock-based compensation, deferred compensation, acquisition/divestiture items, and non-GAAP tax adjustments.

 

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SOURCE Trimble

Contact:

Company Name: Trimble Michael Leyba, Investor Relations, 415-309-3127 Email Contact Lea Ann McNabb, Media, 408-481-7808 Email Contact Web: http://www.trimble.com Financial data for Trimble