Trimble First Quarter 2011 Revenue of $384.3 Million up 20 Percent: Non-GAAP Earnings Per Share of $0.50 Up 47 Percent

(PRNewswire) — Trimble (NASDAQ: TRMB) today announced first quarter 2011 revenue of $384.3 million up 20 percent as compared to the first quarter of 2010.  

 

Operating income for the first quarter of 2011 was $43.7 million, up 21 percent as compared to the first quarter of 2010.  Operating margin in the first quarter of 2011 was 11.4 percent, approximately flat compared to the first quarter of 2010.  

First quarter 2011 non-GAAP operating income of $70.1 million was up 23 percent as compared to the first quarter of 2010.  Non-GAAP operating margin was 18.2 percent compared to 17.9 percent in the first quarter of 2010.  

First quarter 2011 net income was $39.7 million, up 42 percent as compared to the first quarter of 2010.  Diluted earnings per share in the first quarter of 2011 were $0.32 as compared to diluted earnings per share of $0.23 in the first quarter of 2010.  

Non-GAAP net income of $62.5 million for the first quarter of 2011 was up 47 percent as compared to the first quarter of 2010.  Diluted non-GAAP earnings per share in the first quarter of 2011 were $0.50 as compared to diluted non-GAAP earnings per share of $0.34 in the first quarter of 2010. 

First quarter 2011 non-GAAP results exclude:

  • Restructuring expense of  $866 thousand as compared to $674 thousand in the first quarter of 2010;
  • Amortization of intangibles of $16.1 million as compared to $13.8 million in the first quarter of 2010;
  • Stock-based compensation expense of $6.8 million as compared to $5.6 million in the first quarter of 2010;
  • Acquisition-related inventory step-up charge of $508 thousand as compared to $71 thousand in the first quarter of 2010 and;
  • Non-recurring acquisition-related cost of $3.0 million as compared to $538 thousand in the first quarter of 2010.

 

"We continued to track against expectations in the first quarter," commented Steven W. Berglund, Trimble's president and chief executive officer.  "Engineering and Construction segment results reflected growth in all regions driven by increasing demand for survey and heavy and highway products as well as the increasing number of SITECH dealerships.  Field Solutions results reflected growth in both agricultural and GIS product sales.  Although Mobile Solutions showed higher revenue it did not produce operating margins consistent with our expectations," Berglund continued.  "At this point, we remain comfortable with our original outlook for the full year."  

Tri mble 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 and non-recurring acquisition costs.  Non-GAAP segment operating income also excludes the impact of stock-based compensation expense.

Engineering and Construction (E&C)

First quarter 2011 E&C revenue was $190.0 million, up 21 percent as compared to the first quarter of 2010, with growth across geographies and product lines. 

Operating income in E&C for the first quarter 2011 was $22.8 million, or 12.0 percent of revenue, as compared to $18.8 million or 11.9 percent of revenue in the first quarter of 2010.  Non-GAAP operating income was $25.1 million, or 13.2 percent of revenue, as compared to $20.5 million, or 13.0 percent of revenue, in the first quarter of 2010.  Non-GAAP operating margin was up slightly due to increased leverage, offset by higher investment in the VirtualSite Solutions joint venture with Caterpillar, increased marketing expenditures related to tradeshows and the impact of foreign exchange.

Field Solutions

First quarter 2011 Field Solutions revenue was $123.1 million, up 28 percent as compared to the first quarter of 2010 due to strength in both GIS and agricultural product sales.

First quarter 2010 Field Solutions operating income was $52.5 million, or 42.7 percent of revenue, as compared to $39.3 million, or 41.0 percent of revenue, in the first quarter of 2010.  Non-GAAP operating income was $53.0, or 43.1 percent of revenue, as compared to $39.8 million, or 41.5 percent of revenue, in the first quarter of 2010.  The increase in non-GAAP operating margin was due to higher revenue.

Mobile Solutions

First quarter 2011 Mobile Solutions revenue was $44.4 million, up 17 percent as compared to the first quarter of 2010 due primarily to acquisitions. 

The operating loss in Mobile Solutions in the first quarter 2011 was $1.3 million, or negative 3.0 percent of revenue, as compared to operating income of $1.9 million, or 5.0 percent of revenue, in the first quarter of 2010.  Non-GAAP operating loss was $338 thousand, or approximately break-even, as compared to a profit of $3.1 million, or 8.2 percent of revenue, in the first quarter of 2010.  The decline in non-GAAP operating margin was due to the mix of hardware and subscription services revenue, including the loss of a large high-margin customer in the second quarter of 2010, and the impact of acquisitions.

Advanced Devices

First quarter 2011 Advanced Devices revenue was $26.8 million, down 3 percent as compared to the first quarter of 2010 due to slower sales of timing products. 

The operating income in Advanced Devices for the first quarter 2011 was $3.9 million, or 14.4 percent of revenue, as compared to $5.6 million, or 20.4 percent of revenue, in the first quarter of 2010.  Non-GAAP operating income in Advanced Devices was $4.5 million, or 16.9 percent of revenue, as compared to $6.1 million, or 22.0 percent of revenue, in the first quarter of 2010.  The decline in non-GAAP operating margin was due to 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 .

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