Garmin reports second quarter revenue and earnings growth;

Garmin reports second quarter revenue and earnings growth; raises guidance

The net release of uncertain tax position reserves, amounting to approximately $2.9 million and $4.9 million in the first half of 2017 and 2016, respectively, have not been included as pro forma adjustments in the above presentation of pro forma income tax provision as such amounts tend to be more recurring in nature.

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
	July 1,		June 25,		July 1,		June 25,
	2017		2016		2017		2016

Net income (GAAP)	$170,950		$161,064		$408,762		$249,155
Foreign currency gains / losses ⁽¹⁾	(15,110	)	5,743		22,387		10,582
Tax effect of foreign currency gains / losses ⁽²⁾	3,302		(1,204	)	(4,855	)	(2,114	)
Discrete tax items ⁽³⁾	7,275		-		(161,480	)	-
Net income (Pro Forma)	$166,417		$165,603		$264,814		$257,623

Net income per share (GAAP):
Basic	$0.91		$0.85		$2.17		$1.32
Diluted	$0.91		$0.85		$2.17		$1.31

Net income per share (Pro Forma):
Basic	$0.89		$0.88		$1.41		$1.36
Diluted	$0.88		$0.87		$1.40		$1.36

Weighted average common shares outstanding:
Basic	187,757		188,892		187,974		189,195
Diluted	188,492		189,356		188,691		189,491

(1) The majority of the Company’s consolidated foreign currency gains and losses are typically 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 gains and losses.

(2) The tax effect of foreign currency gains and losses was calculated using the pro forma effective tax rate of 21.9% and 21.7% for the quarter and year-to-date ended July 1, 2017, respectively, and an effective tax rate of 21.0% and 20.0% for the quarter and year-to-date ended June 25, 2016, respectively.

(3) The discrete tax items are discussed in the pro forma effective tax rate section.

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