Garmin announces fourth quarter and fiscal year 2021 results

In addition, the board has established March 31, 2022 as the payment date and March 15, 2022 as the record date for the final dividend installment of $0.67 per share, per the prior approval at the 2021 annual shareholders’ meeting. The first, second and third payments of $0.67 per share were made on June 30, 2021, September 30, 2021, and December 31, 2021, respectively.

Webcast Information/Forward-Looking Statements:

The information for Garmin Ltd.’s earnings call is as follows:

When: Wednesday, February 16, 2022 at 10:30 a.m. Eastern
Where: https://www.garmin.com/en-US/investors/events/
How: Simply log on to the web at the address above or call to listen in at 855-757-3897

An archive of the live webcast will be available until February 15, 2023 on the Garmin website at www.garmin.com. To access the replay, click on the Investors link and click over to the Events Calendar page.

This release includes projections and other forward-looking statements regarding Garmin Ltd. and its business that are commonly identified by words such as “anticipates,” “would,” “may,” “expects,” “estimates,” “plans,” “intends,” “projects,” and other words or phrases with similar meanings. Any statements regarding the Company’s expected fiscal 2022 GAAP and pro forma estimated earnings, EPS, and effective tax rate, and the Company’s expected segment revenue growth rates, consolidated revenue, gross margins, operating margins, potential future acquisitions, currency movements, expenses, pricing, new products launches, market reach, statements relating to possible future dividends, and the Company’s plans and objectives are forward-looking statements. The forward-looking events and circumstances discussed in this release may not occur and actual results could differ materially as a result of risk factors and uncertainties affecting Garmin, including, but not limited to, the risk factors that are described in the Annual Report on Form 10-K for the year ended December 25, 2021 filed by Garmin with the Securities and Exchange Commission (Commission file number 001-41118). A copy of Garmin’s 2021 Form 10-K can be downloaded from https://www.garmin.com/en-US/investors/sec/. All information provided in this release and in the attachments is as of December 25, 2021. Undue reliance should not be placed on the forward-looking statements in this press release, which are based on information available to us on the date hereof. We undertake no duty to update this information unless required by law.

This release and the attachments contain non-GAAP financial measures. A reconciliation to the nearest GAAP measure and a discussion of the Company's use of these measures are included in the attachments.

Garmin, the Garmin logo and the Garmin delta, G3000 and GPSMAP are trademarks of Garmin Ltd. or its subsidiaries and are registered in one or more countries, including the U.S. Drive, DriveSmart, Descent, GFC, GMR Fantom and SubWave are trademarks of Garmin Ltd. or its subsidiaries. All other brands, product names, company names, trademarks and service marks are the properties of their respective owners. All rights reserved.

Garmin Ltd. and Subsidiaries

 

Condensed Consolidated Statements of Income (Unaudited)

 

(In thousands, except per share information)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

13-Weeks Ended

 

 

52-Weeks Ended

 

 

 

December 25,

 

 

December 26,

 

 

December 25,

 

 

December 26,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Net sales

 

$

1,391,589

 

 

$

1,351,405

 

 

$

4,982,795

 

 

$

4,186,573

 

Cost of goods sold

 

 

619,484

 

 

 

560,422

 

 

 

2,092,336

 

 

 

1,705,237

 

Gross profit

 

 

772,105

 

 

 

790,983

 

 

 

2,890,459

 

 

 

2,481,336

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Advertising expense

 

 

61,124

 

 

 

61,135

 

 

 

171,829

 

 

 

151,166

 

Selling, general and administrative expense

 

 

174,090

 

 

 

158,910

 

 

 

659,986

 

 

 

570,245

 

Research and development expense

 

 

221,772

 

 

 

199,672

 

 

 

840,024

 

 

 

705,685

 

Total operating expenses

 

 

456,986

 

 

 

419,717

 

 

 

1,671,839

 

 

 

1,427,096

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

 

315,119

 

 

 

371,266

 

 

 

1,218,620

 

 

 

1,054,240

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

7,005

 

 

 

6,744

 

 

 

28,573

 

 

 

37,002

 

Foreign currency (losses) gains

 

 

(14,642

)

 

 

12,627

 

 

 

(45,263

)

 

 

2,825

 

Other income

 

 

1,355

 

 

 

828

 

 

 

4,866

 

 

 

9,343

 

Total other income (expense)

 

 

(6,282

)

 

 

20,199

 

 

 

(11,824

)

 

 

49,170

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

 

308,837

 

 

 

391,465

 

 

 

1,206,796

 

 

 

1,103,410

 

Income tax provision

 

 

22,702

 

 

 

57,918

 

 

 

124,596

 

 

 

111,086

 

Net income

 

$

286,135

 

 

$

333,547

 

 

$

1,082,200

 

 

$

992,324

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

1.49

 

 

$

1.74

 

 

$

5.63

 

 

$

5.19

 

Diluted

 

$

1.48

 

 

$

1.73

 

 

$

5.61

 

 

$

5.17

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

192,353

 

 

 

191,278

 

 

 

192,180

 

 

 

191,085

 

Diluted

 

 

193,306

 

 

 

192,303

 

 

 

193,043

 

 

 

191,895

 

Garmin Ltd. and Subsidiaries

 

Condensed Consolidated Balance Sheets (Unaudited)

 

(In thousands, except per share information)

 

 

 

 

 

 

 

 

 

 

 

 

December 25,

 

 

December 26,

 

2021

2020

Assets

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

1,498,058

 

 

$

1,458,442

 

Marketable securities

 

 

347,980

 

 

 

387,642

 

Accounts receivable, net

 

 

843,445

 

 

 

849,469

 

Inventories

 

 

1,227,609

 

 

 

762,084

 

Deferred costs

 

 

15,961

 

 

 

20,145

 

Prepaid expenses and other current assets

 

 

328,719

 

 

 

191,569

 

Total current assets

 

 

4,261,772

 

 

 

3,669,351

 

 

 

 

 

 

 

 

 

 

Property and equipment, net

 

 

1,067,478

 

 

 

855,539

 

Operating lease right-of-use assets

 

 

89,457

 

 

 

94,626

 

Noncurrent marketable securities

 

 

1,268,698

 

 

 

1,131,175

 

Deferred income tax assets

 

 

260,205

 

 

 

245,455

 

Noncurrent deferred costs

 

 

12,361

 

 

 

16,510

 

Intangible assets, net

 

 

791,073

 

 

 

828,566

 

Other noncurrent assets

 

 

103,383

 

 

 

190,151

 

Total assets

 

$

7,854,427

 

 

$

7,031,373

 

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

$

370,048

 

 

$

258,885

 

Salaries and benefits payable

 

 

211,371

 

 

 

181,937

 

Accrued warranty costs

 

 

45,467

 

 

 

42,643

 

Accrued sales program costs

 

 

121,514

 

 

 

109,891

 

Other accrued expenses

 

 

225,988

 

 

 

181,767

 

Deferred revenue

 

 

87,654

 

 

 

86,865

 

Income taxes payable

 

 

128,083

 

 

 

68,585

 

Dividend payable

 

 

258,023

 

 

 

233,644

 

Total current liabilities

 

 

1,448,148

 

 

 

1,164,217

 

 

 

 

 

 

 

 

 

 

Deferred income tax liabilities

 

 

117,595

 

 

 

116,844

 

Noncurrent income taxes payable

 

 

62,539

 

 

 

92,810

 

Noncurrent deferred revenue

 

 

41,618

 

 

 

49,934

 

Noncurrent operating lease liabilities

 

 

70,044

 

 

 

75,958

 

Other noncurrent liabilities

 

 

324

 

 

 

15,494

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

 

 

Shares, CHF 0.10 par value, 198,077 shares authorized and issued, 192,608 shares outstanding at December 25, 2021; and 191,571 shares outstanding at December 26, 2020

 

 

17,979

 

 

 

17,979

 

Additional paid-in capital

 

 

1,960,722

 

 

 

1,880,354

 

Treasury stock

 

 

(303,114

)

 

 

(320,016

)

Retained earnings

 

 

4,320,737

 

 

 

3,754,372

 

Accumulated other comprehensive income

 

 

117,835

 

 

 

183,427

 

Total stockholders’ equity

 

 

6,114,159

 

 

 

5,516,116

 

Total liabilities and stockholders’ equity

 

$

7,854,427

 

 

$

7,031,373

 

Garmin Ltd. and Subsidiaries

 

Consolidated Statements of Cash Flows

 

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

52-Weeks Ended

 

 

 

December 25,

 

 

December 26,

 

2021

2020

Operating Activities:

 

 

 

 

 

 

 

 

Net income

 

$

1,082,200

 

 

$

992,324

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

 

 

Depreciation

 

 

103,498

 

 

 

78,121

 

Amortization

 

 

51,320

 

 

 

48,594

 

Loss (gain) on sale of property and equipment

 

 

298

 

 

 

(1,799

)

Unrealized foreign currency losses (gains)

 

 

36,385

 

 

 

(9,873

)

Deferred income taxes

 

 

(5,368

)

 

 

6,931

 

Stock compensation expense

 

 

92,522

 

 

 

80,885

 

Realized gains on marketable securities

 

 

(622

)

 

 

(1,392

)

Changes in operating assets and liabilities, net of acquisitions:

 

 

 

 

 

 

 

 

Accounts receivable, net of allowance for doubtful accounts

 

 

(19,106

)

 

 

(108,859

)

Inventories

 

 

(476,454

)

 

 

28,726

 

Other current and noncurrent assets

 

 

(38,004

)

 

 

(33,690

)

Accounts payable

 

 

108,946

 

 

 

1,447

 

Other current and noncurrent liabilities

 

 

70,007

 

 

 

87,761

 

Deferred revenue

 

 

(7,377

)

 

 

(25,211

)

Deferred costs

 

 

8,288

 

 

 

11,973

 

Income taxes

 

 

5,894

 

 

 

(20,671

)

Net cash provided by operating activities

 

 

1,012,427

 

 

 

1,135,267

 

 

 

 

 

 

 

 

 

 

Investing activities:

 

 

 

 

 

 

 

 

Purchases of property and equipment

 

 

(307,645

)

 

 

(185,401

)

Proceeds from sale of property and equipment

 

 

35

 

 

 

1,977

 

Purchase of intangible assets

 

 

(1,942

)

 

 

(2,065

)

Purchase of marketable securities

 

 

(1,508,712

)

 

 

(1,052,640

)

Redemption of marketable securities

 

 

1,363,070

 

 

 

1,126,253

 

Acquisitions, net of cash acquired

 

 

(20,175

)

 

 

(148,648

)

Net cash used in investing activities

 

 

(475,369

)

 

 

(260,524

)

 

 

 

 

 

 

 

 

 

Financing activities:

 

 

 

 

 

 

 

 

Dividends

 

 

(491,457

)

 

 

(450,631

)

Proceeds from issuance of treasury stock related to equity awards

 

 

35,733

 

 

 

15,201

 

Purchase of treasury stock related to equity awards

 

 

(30,985

)

 

 

(26,330

)

Net cash used in financing activities

 

 

(486,709

)

 

 

(461,760

)

 

 

 

 

 

 

 

 

 

Effect of exchange rate changes on cash and cash equivalents

 

 

(10,254

)

 

 

18,127

 

 

 

 

 

 

 

 

 

 

Net increase in cash, cash equivalents, and restricted cash

 

 

40,095

 

 

 

431,110

 

Cash, cash equivalents, and restricted cash at beginning of year

 

 

1,458,748

 

 

 

1,027,638

 

Cash, cash equivalents, and restricted cash at end of year

 

$

1,498,843

 

 

$

1,458,748

 


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