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 |
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Pro Forma Net Income (Earnings) Per Share |
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(In thousands, except per share information) |
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13-Weeks Ended |
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39-Weeks Ended |
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September 26, |
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September 28, |
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September 26, |
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September 28, |
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2020 |
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2019 |
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2020 |
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2019 |
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GAAP net income |
$ |
313,417 |
|
$ |
227,866 |
|
$ |
658,776 |
|
$ |
591,695 |
|
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Foreign currency gains / losses(1) |
|
(10,113 |
) |
|
16,296 |
|
|
9,802 |
|
|
12,568 |
|
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Tax effect of foreign currency gains / losses(2) |
|
700 |
|
|
(1,890 |
) |
|
(929 |
) |
|
(1,942 |
) |
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Pro forma discrete tax item(3) |
|
— |
|
|
— |
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(14,308 |
) |
|
— |
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| Pro forma net income |
$ |
304,004 |
|
$ |
242,272 |
|
$ |
653,341 |
|
$ |
602,321 |
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| GAAP net income per share: |
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| Basic |
$ |
1.64 |
|
$ |
1.20 |
|
$ |
3.45 |
|
$ |
3.12 |
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| Diluted |
$ |
1.63 |
|
$ |
1.19 |
|
$ |
3.44 |
|
$ |
3.10 |
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| Pro forma net income per share: |
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| Basic |
$ |
1.59 |
|
$ |
1.27 |
|
$ |
3.42 |
|
$ |
3.17 |
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| Diluted |
$ |
1.58 |
|
$ |
1.27 |
|
$ |
3.41 |
|
$ |
3.16 |
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| Weighted average common shares outstanding: |
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| Basic |
|
191,234 |
|
|
190,102 |
|
|
191,021 |
|
|
189,853 |
|
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| Diluted |
|
191,998 |
|
|
190,962 |
|
|
191,760 |
|
|
190,790 |
|
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(1) Foreign currency gains and losses for the Company are driven by movements of a number of currencies 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 a given legal entity. However, there is minimal cash impact from such foreign currency gains and losses.
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(2) The tax effect of foreign currency gains and losses was calculated using the pro forma effective tax rate of 6.9% and 9.5% for the 13-weeks and 39-weeks ended September 26, 2020, respectively, and an effective tax rate of 11.6% and 15.4% for the 13-weeks and 39-weeks ended September 28, 2019, respectively.
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| (3) The discrete tax item is discussed in the pro forma effective tax rate section above. |
