Garmin reports 3Q results

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Garmin Ltd. increased its third-quarter revenue by 3 percent, to $743 million, with outdoor, aviation, marine and fitness collectively growing 9 percent from the prior year’s quarter and contributing 75 percent of total revenue.

The marine segment alone grew 10 percent, to $77.3 million, in the third quarter, compared with $70 million last year, which the company attributed to its strong lineup of chart plotters and fishfinders.

Garmin’s gross margin improved to 58.4 percent, compared with 56.2 percent in the year-earlier quarter.

Operating margin improved to 22.8 percent, compared with 22.1 percent last year. Operating income was $170 million, up 6 percent.

The company reported a profit of $147.4 million for the quarter that ended Sept. 30, compared with $125.1 million in the quarter last year.

GAAP earnings per share was 78 cents, an 18 percent improvement from the prior-year quarter, and pro forma EPS was 75 cents, which was consistent with the quarter last year.

“We continued our strong performance through the third quarter, with double-digit revenue and operating profit growth in outdoor, aviation and marine,” said Cliff Pemble, president and chief executive officer of Garmin Ltd., in a statement. “We are well positioned for the remainder of 2017 with a strong lineup of new products and opportunities in each business segment.”

Gross margin in the marine segment increased year over year to 58 percent, and the operating margin improved to 24 percent.

For the third consecutive year Garmin was recognized as the Manufacturer of the Year by the National Marine Electronics Association, winning a total of nine awards across a broad range of product categories.

The company recently completed the acquisition of Navionics S.p.A., a privately held provider of electronic navigational charts and mobile applications.

Garmin announced its 2018 lineup of marine electronics, with updated echoMap and Striker products. Looking forward, the company said it is focused on product innovations and gaining share in the inland fishing category.

Garmin raised its 2017 revenue guidance to $3.07 billion, driven primarily by higher expectations for its outdoor, aviation and auto segments — partially offset by lower expectations for the fitness segment. The company’s outlook for marine is unchanged.

Garmin anticipates that its full-year pro-forma EPS will be about $2.90, based on a gross margin of about 57.5 percent, an operating margin of about 21.5 percent, and a full-year pro-forma effective tax rate of about 21.5 percent.


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