- Third Quarter 2015 Revenue $562.3 Million
(PRNewswire) — Trimble (NASDAQ: TRMB) today announced financial results for the third quarter of 2015.
Third Quarter 2015 Financial Summary
Third quarter 2015 revenue of $562.3 million was down 4 percent as compared to the third quarter of 2014, and was approximately flat on a constant currency basis. Engineering and Construction revenue was $326.4 million, down 5 percent. Field Solutions revenue was $73.5 million, down 17 percent. Mobile Solutions revenue was $131.6 million, up 9 percent. Advanced Devices revenue was $30.8 million, down 6 percent.
GAAP operating income was $46.0 million, up 314 percent as compared to the third quarter of 2014. GAAP operating margin was 8.2 percent of revenue as compared to 1.9 percent of revenue in the third quarter of 2014.
GAAP net income was $37.1 million, up 214 percent as compared to the third quarter of 2014. Diluted GAAP earnings per share were $0.14 as compared to diluted GAAP earnings per share of $0.04 in the third quarter of 2014.
Third quarter 2014 GAAP results were negatively impacted by an approximately $51 million reserve for legal matters related to a jury verdict, which was reversed in the fourth quarter of 2014 when the verdict was overturned.
Non-GAAP operating income of $104.9 million was down 11 percent as compared to the third quarter of 2014. Non-GAAP operating margin was 18.7 percent of revenue as compared to 20.2 percent of revenue in the third quarter of 2014.
Non-GAAP net income of $77.8 million was down 11 percent as compared to the third quarter of 2014. Diluted non-GAAP earnings per share were $0.30 as compared to diluted non-GAAP earnings per share of $0.33 in the third quarter of 2014.
The GAAP tax rate for the quarter was 15 percent and the non-GAAP tax rate was 24 percent.
Operating cash flow for the first three quarters of 2015 was $276.4 million, down 11 percent as compared to the first three quarters of 2014.
During the third quarter of 2015, Trimble repurchased approximately 8.2 million shares of its common stock for a total of $154.6 million. Trimble received approximately 3.7 million of these shares through the accelerated share repurchase program announced on September 2, 2015, and additional shares will be delivered in the fourth quarter upon completion of the program. Following the completion of the program, approximately $250 million will remain on the current share repurchase authorization.
"We met our revenue expectations and improved operating margins sequentially in the quarter," said Steven W. Berglund, Trimble's president and chief executive officer. "Revenue was negatively impacted by continued poor conditions in the agriculture market, the effects of oil price declines, and foreign exchange effects. As these conditions lessen we anticipate a return to growth in 2016."
Forward Looking Guidance
For the fourth quarter of 2015 Trimble expects revenue to be between $520 million and $550 million with GAAP earnings per share of $0.01 to $0.08 and non-GAAP earnings per share of $0.19 to $0.26. Non-GAAP guidance excludes the amortization of intangibles of $40 million related to previous acquisitions, anticipated acquisition costs of $3 million, the anticipated impact of stock-based compensation expense of $14 million, and $3 million in anticipated restructuring charges. GAAP guidance assumes a tax rate of 25 percent and non-GAAP guidance assumes a tax rate of 24 percent. Both GAAP and non-GAAP earnings per share assume approximately 253 million shares outstanding.
Investor Conference Call / Webcast Details
Trimble will hold a conference call on October 29 at 1:30 p.m. PT to review its third quarter 2015 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 (702) 928-6633 (international). The pass code is 56821478. The replay will also be available on the Web at the address above.
Use of Non-GAAP Financial Information
To help our investors understand our past financial performance and our future results, as well as our performance relative to competitors, we supplement the financial results that we provide in accordance with generally accepted accounting principles, or GAAP, with non-GAAP financial measures. These non-GAAP measures can be used to evaluate our historical and prospective financial performance, as well as our performance relative to competitors. 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. Further, we believe some of our investors track our "core operating performance" as a means of evaluating our performance in the ordinary, ongoing, and customary course of our operations. Core operating performance excludes items that are non-cash, not expected to recur or not reflective of ongoing financial results. Management also believes that looking at our core operating performance provides a supplemental way to provide consistency in period to period comparisons.
The specific non-GAAP measures, which we use along with a reconciliation to the nearest comparable GAAP measures and the explanation for why these non-GAAP measures provide useful information to investors regarding our financial condition and results of operations and why management chose to exclude selected items 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. 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://investor.trimble.com.
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: www.trimble.com.
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, the impact of acquisitions, the ability to deliver revenue, earnings per share and other financial projections that Trimble has guided for the fourth quarter, the expected tax rate, the anticipated impact of stock-based compensation expense, the amortization of intangibles related to previous acquisitions and the anticipated number of shares outstanding and interest costs. 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. The Company's results may be adversely affected if the Company is unable to market, manufacture and ship new products, obtain new customers, or integrate new acquisitions. The Company's results would also be negatively impacted by weakening in the macro environment including declining oil prices or foreign exchange fluctuations. Any failure to achieve predicted results could negatively impact the Company's revenues, cash flow from operations, and other financial results. The Company's financial results will also depend on a number of other factors and 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, such as changes in economic conditions, further worsening in the agricultural market, critical part supply chain shortages, possible write-offs of goodwill, and regulatory proceedings affecting GPS. 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.