Trimble Reports Fiscal 2008 Revenue Growth of 9 Percent and Non-GAAP Earnings Per Share Growth of 23 Percent: Prepares For Challenging Year

Advanced Devices

Fourth quarter 2008 Advanced Devices revenue was $27.2 million, down approximately 5 percent when compared to the fourth quarter of 2007. Fiscal 2008 Advanced Devices revenue was $119.7 million down approximately one percent compared to 2007. The decline in fourth quarter revenue was due mainly to slower sales of component technology products which are sold to OEMs.

Operating income in Advanced Devices for the fourth quarter 2008 was $6.3 million, or 23.3 percent of revenue, compared to $3.7 million, or 12.7 percent of revenue, in the fourth quarter of 2007. For 2008 operating income in Advanced Devices was $24.4 million, or 20.4 percent of revenue, compared to $17.3 million, or 14.3 percent of revenue, in 2007.

In the fourth quarter of 2008, non-GAAP operating income in Advanced Devices was $6.7 million, or 24.7 percent of revenue, compared to 14.0 percent of revenue in the fourth quarter of 2007. For fiscal 2008, non-GAAP operating income in Advanced Devices was $25.8 million, or 21.6 percent of revenue compared to 15.4 percent of revenue in fiscal 2007. For both the quarter and the full year margin improvement was the result of increased licensing revenue and product mix.

Stock Repurchase Program

As part of its stock repurchase program, in the fourth quarter of 2008, Trimble repurchased 536,000 shares of Trimble stock at an average price of $18.69.

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://www.investor.trimble.com.

Forward Looking Guidance

Trimble assumes that fourth quarter market uncertainty will continue into the first quarter of 2009. The Company currently estimates first quarter 2009 revenue of $300 million. However, given the volatility of current market conditions we believe this revenue estimate could vary plus or minus five percent. Using a $300 million dollar revenue estimate, first quarter 2009 GAAP earnings per share are projected to be $0.12 and non-GAAP earnings per share are projected to be $0.27. Non-GAAP guidance for the first quarter of 2009 excludes the amortization of intangibles of $14.2 million related to previous acquisitions, the anticipated impact of stock-based compensation expense of $4.2 million and $5.5 million in restructuring charges. Both GAAP and non-GAAP guidance use a 28 percent tax rate and assume 122 million shares outstanding.

Investor Conference Call / Webcast Details

Trimble will hold a conference call on February 3, 2009 at 1:30 p.m. PT to review its fourth quarter and fiscal year 2008 results. It will be broadcast live on the Web at http://investor.trimble.com. Investors without Internet access may dial into the call at (800) 528-9198 (U.S.) or (706) 634-6089 (international). A replay of the call will be available for seven days at (800) 642-1687 (U.S.) or (706) 645-9291 (international) and the pass code is 80512820. The replay will also be available on the Web at the address above.

About Trimble

Trimble applies technology to make field and mobile workers in businesses and government significantly more productive. Solutions are focused on applications requiring position or location-including surveying, construction, agriculture, fleet and asset management, public safety and mapping. In addition to utilizing positioning technologies, such as GPS, lasers and optics, Trimble solutions may include software content specific to the needs of the user. Wireless technologies are utilized to deliver the solution to the user and to ensure a tight coupling of the field and the back office. Founded in 1978, Trimble is headquartered in Sunnyvale, Calif.

For more information visit Trimble's Web site at http://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 for future financial market and economic conditions, engineering and construction market spending, revenue and earnings per share that Trimble expects to report in the first quarter 2009, changes in tax-rate, our estimated restructuring costs and the impact of cost-reduction efforts on financial results in fiscal 2009. These forward-looking statements are subject to change, and actual results may materially differ from those set forth in this press release due to certain risks and uncertainties. If the current global economic crisis and recessionary conditions in the U.S. and Europe show no signs of recovery it may negatively impact our customers' purchasing decisions worldwide including in emerging markets. In addition, the Company's results may be adversely affected if the Company is unable to market, manufacture and ship new products. Any weakening of our accounts receivable or write-off of goodwill could also impair our financial results. Any failure to achieve predicted results could negatively impact the Company's revenues, cash flow from operations and other financial results. Whether the Company achieves growth will also depend on a number of other factors, including the 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, especially in light of greater uncertainty than normal in the economy in general. 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

                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                      (In thousands, except per share data)
                                   (Unaudited)

                                   Three Months Ended   Twelve Months Ended

                                             Jan-02,      Dec-28,        Jan-02,          Dec-28,
                                                                          2009            2007              2009                2007

        Revenue                                                $268,084    $312,783    $1,329,234    $1,222,270
        Cost  of  sales                                      146,046      157,117          680,098          609,365
        Gross  margin                                        122,038      155,666          649,136          612,905
        Gross  margin  (%)                                    45.5%          49.8%              48.8%              50.1%

        Operating  expenses
                Research  and  development          36,168        34,731          148,265          131,468
                Sales  and  marketing                    44,563        51,528          196,290          186,495
                General  and  administrative      23,972        25,390            94,023            92,572
                Restructuring                                      287                  -              2,722              3,025
                Amortization  of  purchased
                  intangible  assets                        6,608          4,754            22,376            18,966
                In-process  research  and
                  development                                            -                  -                      -              2,112
                      Total  operating
                        expenses                                111,598      116,403          463,676          434,638


        Operating  income                                  10,440        39,263          185,460          178,267

        Non-operating  income
          (expense),  net
                Interest  income                                  675              896              2,044              3,502
                Interest  expense                          (1,371)      (1,127)          (2,760)          (6,602)
                Foreign  currency
                  transaction  gain  (loss),
                  net                                                      (829)          (819)            1,509            (1,351)
                Income  from  joint
                  ventures,  net                                1,185          1,932              7,981              8,377
                Minority  interests  in
                  consolidated  subsidiaries            519                  6                  540                      6
                Other  income  (expense),
                  net                                                  (1,130)            384            (2,812)            1,557
                      Total  non-operating
                        income  (expense),  net            (951)        1,272              6,502              5,489

        Income    before  taxes                            9,489        40,535          191,962          183,756

        Income  tax  provision  (benefit)      (4,250)      14,244            50,490            66,382
        Net  income                                            $13,739      $26,291        $141,472        $117,374


        Earnings  per  share  :
                  Basic                                                $0.12          $0.22              $1.17              $0.98
                  Diluted                                            $0.11          $0.21              $1.14              $0.94

        Shares  used  in  calculating
          earnings  per  share  :
                Basic                                              119,342      121,428          120,714          119,280
                Diluted                                          121,728      126,532          124,235          124,410



                                            CONDENSED  CONSOLIDATED  BALANCE  SHEETS
                                                                  (In  thousands)
                                                                      (Unaudited)


                                                                                                      Jan-02,                      Dec-28,
                                                                                                        2009                            2007
        Assets

        Current  assets:
              Cash  and  cash  equivalents                                    $147,531                    $103,202
              Accounts  receivables,  net                                      204,269                      239,884
              Other  receivables                                                        17,540                        10,201
              Inventories,  net                                                        160,893                      143,018
              Deferred  income  taxes                                                41,810                        44,333
              Other  current  assets                                                  16,404                        15,661
                    Total  current  assets                                          588,447                      556,299

        Property  and  equipment,  net                                          50,175                        51,444
        Goodwill                                                                              715,571                      675,850
        Other  purchased  intangible  assets,
          net                                                                                      228,901                      197,777
        Other  non-current  assets                                                51,922                        57,989

                    Total  assets                                                    $1,635,016                $1,539,359

        Liabilities  and  Shareholders'  Equity

        Current  liabilities:
              Current  portion  of  long-term  debt                            $124                            $126
              Accounts  payable                                                          49,611                        67,589
              Accrued  compensation  and  benefits                        41,291                        55,133
              Deferred  revenue                                                          55,241                        49,416
              Accrued  warranty  expense                                          13,332                        10,806
              Income  taxes  payable                                                        -                            14,802
              Other  accrued  liabilities                                        63,719                        51,980
                    Total  current  liabilities                                223,318                      249,852

        Non-current  portion  of  long-term  debt                    151,464                        60,564
        Non-current  deferred  revenue                                        12,418                        15,872
        Deferred  income  taxes                                                      42,207                        47,917
        Other  non-current  liabilities                                      61,553                        56,128

                    Total  liabilities                                                490,960                      430,333

        Minority  interests  in  consolidated
          subsidiaries                                                                        3,655                                  -

        Commitments  and  contingencies

        Shareholders'  equity:
              Common  stock                                                                684,831                      660,749
              Retained  earnings                                                      427,921                      388,557
              Accumulated  other  comprehensive
                income                                                                            27,649                        59,720
                    Total  shareholders'  equity                          1,140,401                  1,109,026

                    Total  liabilities  and
                      shareholders'  equity                                  $1,635,016                $1,539,359




                                CONDENSED  CONSOLIDATED  STATEMENTS  OF  CASH  FLOWS
                                                                  (In  thousands)
                                                                      (Unaudited)
                                                                                                            Twelve  Months  Ended
                                                                                                      Jan-02,                      Dec-28,
                                                                                                        2009                            2007

        Cash  flow  from  operating  activities:
                Net  Income                                                                $141,472                    $117,374

                Adjustments  to  reconcile  net
                  income    to  net  cash  provided  by
                      operating  activities:
                          Depreciation  expense                                      19,047                        17,212
                          Amortization  expense                                      45,066                        38,744
                          Provision  for  doubtful
                            accounts                                                              2,709                          1,410
                          Amortization  of  debt
                            issuance  cost                                                        169                              218
                          Deferred  income  taxes                                  (17,356)                        6,368
                          Non-cash  restructuring
                            expense                                                                    -                              1,725
                          Stock-based  compensation                              16,166                        15,016
                          In-process  research  and
                            development                                                            -                              2,112
                          Equity  gain  from  joint
                            ventures                                                            (7,981)                      (8,377)
                          Excess  tax  benefit  for
                            stock-based  compensation                            (5,970)                    (12,409)
                          Provision  for  excess  and
                            obsolete  inventories                                      4,426                          4,352
                          Other  non-cash  items                                          (348)                            651

                Add  decrease  (increase)  in
                  assets:
                          Accounts  receivables                                      33,414                      (35,696)
                          Other  receivables                                            (7,422)                        4,825
                          Inventories                                                      (16,461)                    (18,678)
                          Other  current  and  non-
                            current  assets                                                      779                          7,650

                Add  increase  (decrease)  in
                  liabilities:
                          Accounts  payable                                            (20,898)                      (3,521)
                          Accrued  compensation  and
                            benefits                                                          (12,487)                        1,691
                          Accrued  liabilities                                          3,183                        (4,635)
                          Deferred  revenue                                              (1,320)                      32,400
                          Income  taxes  payable                                          (114)                      18,553
          Net  cash  provided  by  operating
            activities                                                                      176,074                      186,985

          Cash  flows  from  investing
            activities:
                    Acquisitions  of  businesses,  net
                      of  cash  acquired                                              (115,137)                  (295,848)
                    Acquisition  of  property  and
                      equipment                                                              (16,196)                    (13,187)
                    Purchases  of  debt  and  equity
                      securities                                                                    -                            (5,576)
                    Dividends  received                                                10,648                          2,888
                    Capital  infusion  from  minority
                      investor                                                                    4,200                              -
                    Other                                                                          (5,211)                            331
          Net  cash  used  in  investing
            activities                                                                    (121,696)                  (311,392)

          Cash  flow  from  financing  activities:
                    Issuance  of  common  stock                                    22,802                        31,864
                    Excess  tax  benefit  for  stock-
                      based  compensation                                                5,970                        12,409
                    Repurchase  and  retirement  of
                      common  stock                                                      (125,888)                            -
                    Proceeds  from  long-term  debt
                      and  revolving  credit  lines                            151,000                      250,000
                    Payments  on  long-term  debt  and
                      revolving  credit  lines                                    (60,314)                  (190,457)
                    Other                                                                                (11)                            -
          Net  cash  provided  by  (used  in)
            financing  activities                                                    (6,441)                    103,816

          Effect  of  exchange  rate  changes  on
            cash  and  cash  equivalents                                          (3,608)                      (5,828)

          Net  increase(decrease)  in  cash  and
            cash  equivalents                                                            44,329                      (26,419)
          Cash  and  cash  equivalents  -
            beginning  of  period                                                    103,202                      129,621

          Cash  and  cash  equivalents  -  end  of
            period                                                                            $147,531                    $103,202



                                                    NON-GAAP  RECONCILIATION
                                CONDENSED  CONSOLIDATED  STATEMENTS  OF  INCOME
                              (Dollars  in  thousands,  except  per  share  data)
                                                                (Unaudited)


                                                          Three  Months  Ended      Twelve  Months  Ended
                                                            Jan-02,      Dec-28,        Jan-02,          Dec-28,
                                                              2009            2007              2009                2007

        REVENUE:                                  $268,084    $312,783    $1,329,234    $1,222,270

        GROSS  MARGIN:
          GAAP  gross  margin:            $122,038    $155,666        $649,136        $612,905
            Restructuring          (A)              559              -                  1,919                  -
            Amortization  of
              purchased
              intangibles            (B)          5,418          5,330            22,515            19,619
            Stock-based
              compensation          (D)              487              493              1,920              1,733
            Amortization  of
              acquisition-
              related  inventory
              step-up                    (E)              813                  -              1,414                      -
          Non-GAAP  gross  margin:    $129,315    $161,489        $676,904        $634,257
          Non-GAAP  gross  margin
            (%  of  revenue)                        48.2%          51.6%              50.9%              51.9%

        OPERATING  EXPENSES:
          GAAP  operating
            expenses:                            $111,598    $116,403        $463,676        $434,638
            Restructuring
                                                (A)            (287)            -                (2,722)          (3,025)
            Amortization  of
              purchased
              intangibles            (B)        (6,608)      (4,754)        (22,376)        (18,966)
            In-process
              research  and
              development            (C)              -                  -                      -                (2,112)
            Stock-based
              compensation          (D)        (4,076)      (3,574)        (14,246)        (13,283)
          Non-GAAP  operating
            expenses:                            $100,627    $108,075        $424,332        $397,252

        OPERATING  INCOME:
          GAAP  operating  income:      $10,440      $39,263        $185,460        $178,267
            Restructuring
                                                (A)              846              -                  4,641              3,025
            Amortization  of
              purchased
              intangibles            (B)        12,026        10,084            44,891            38,585
            In-process
              research  and
              development            (C)                  -                  -                      -              2,112
            Stock-based
              compensation          (D)          4,563          4,067            16,166            15,016
            Amortization  of
              acquisition-
              related  inventory
              step-up                    (E)              813                  -              1,414                      -
          Non-GAAP  operating
            income:                                  $28,688      $53,414        $252,572        $237,005
          Non-GAAP  operating
            margin  (%  of  revenue)          10.7%          17.1%              19.0%              19.4%

        NET  INCOME:
          GAAP  net  income:                  $13,739      $26,291        $141,472        $117,374
            Restructuring
                                                (A)              846              -                  4,641              3,025
            Amortization  of
              purchased
              intangibles            (B)        12,026        10,084            44,891            38,585
            In-process
              research  and
              development            (C)                  -                  -                      -              2,112
            Stock-based
              compensation          (D)          4,563          4,067            16,166            15,016
            Amortization  of
              acquisition-
              related  inventory
              step-up                    (E)              813                  -              1,414                      -
            Income  tax  effect
              on  non-GAAP
              adjustments            (F)        (3,029)      (4,973)        (17,649)        (21,035)
          Non-GAAP  net  income:          $28,958      $35,469        $190,935        $155,077

        DILUTED  NET  INCOME  PER
          SHARE:
          GAAP  diluted  net  income
            per  share:                                $0.11          $0.21              $1.14              $0.94
          Non-GAAP  diluted  net
            income  per  share:                  $0.24          $0.28              $1.54              $1.25

        SHARES  USED  TO  COMPUTE
          DILUTED  NET
        INCOME  PER  SHARE:
          GAAP  and  Non-GAAP
            shares  used  to  compute
          net  income  per  share:        121,728      126,532          124,235          124,410

        OPERATING  LEVERAGE:
          Increase  (decrease)  in
            non-GAAP  operating
            income                                  $(24,726)                            $15,567
          Increase  (decrease)  in
            revenue                                $(44,699)                          $106,964
          Operating  leverage
            (increase  in  non-GAAP
            operating
          income  as  a  %  of
            increase  in  revenue)                  N/A                                14.6%

 


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