We expect revenues to decline in 2011 as the growth in the outdoor, fitness, marine and aviation segments, as well as auto OEM opportunities, is offset by ongoing declines in the PND market. We anticipate gross margins to be stable and operating margins to decline slightly from the strong margins generated in 2010. The operating margin declines will be primarily driven by ongoing investment in the business. These factors and an anticipated effective tax rate of 20% result in a forecasted 2011 earnings per share range of $2.25 - $2.50.

Non-GAAP Measures

Pro Forma net income (earnings) per share

Management believes that net income per share before the impact of foreign currency translation gain or loss and other one-time items is an important measure. The majority of the Company’s consolidated foreign currency gain or loss results from transactions involving the Euro, the British Pound Sterling and the Taiwan Dollar and from the exchange rate impact of the significant cash and marketable securities, receivables and payables held in U.S. dollars at the end of each reporting period by the Company’s various non U.S. subsidiaries. Such gain or loss is required under GAAP because the functional currency of the subsidiaries differs from the currency in which various assets and liabilities are held. However, there is minimal cash impact from such foreign currency gain or loss. Accordingly, earnings per share before the impact of foreign currency translation gain or loss allow an assessment of the Company’s operating performance before the non-cash impact of the position of the U.S. Dollar versus other currencies, which permits a consistent comparison of results between periods.

The following table contains a reconciliation of GAAP net income per share to pro forma net income per share.

Garmin Ltd. And Subsidiaries
Net income per share (Pro Forma)
(in thousands, except per share information)
		13-Weeks Ended						52-weeks Ended
		December 25,			December 26,			December 25,				December 26,
		2010			2009			2010				2009
Net Income (GAAP)		$	132,907		$	278,408		$	584,603			$	703,950
Foreign currency (gain) / loss, net of normalized tax effects		$	28,687		$	10,022		$	74,383			$	5,258
One-time tax adjustment			-			-			($98,737	)			-
Net income (Pro Forma)		$	161,594		$	288,430		$	560,249			$	709,208
Net income per share (GAAP):
Basic		$	0.68		$	1.39		$	2.97			$	3.51
Diluted		$	0.68		$	1.38		$	2.95			$	3.50
Net income per share (Pro Forma):
Basic		$	0.83		$	1.44		$	2.84			$	3.54
Diluted		$	0.83		$	1.43		$	2.83			$	3.53
Weighted average common shares outstanding:
Basic			194,043			200,385			196,979				200,395
Diluted			194,858			201,584			198,009				201,161

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