Consolidated Balance Sheets
Consolidated Balance Sheets (USD $) | ||
In Thousands | Dec. 26, 2009
| Dec. 27, 2008
|
Current assets: | ||
Cash and cash equivalents | $1,091,581 | $696,335 |
Marketable securities (Note 3) | 19,583 | 12,886 |
Accounts receivable, less allowance for doubtful accounts of $36,673 in 2009 and $42,409 in 2008 | 874,110 | 741,321 |
Inventories, net | 309,938 | 425,312 |
Deferred income taxes (Note 6) | 59,189 | 49,825 |
Prepaid expenses and other current assets | 39,470 | 58,746 |
Total current assets | 2,393,871 | 1,984,425 |
Property and equipment, net | ||
Land and improvements | 92,088 | 88,272 |
Building and improvements | 268,011 | 244,804 |
Office furniture and equipment | 84,544 | 72,665 |
Manufacturing equipment | 115,179 | 113,956 |
Engineering equipment | 65,240 | 59,009 |
Vehicles | 15,247 | 14,698 |
Total property and equipment, cost | 640,309 | 593,404 |
Accumulated depreciation | (198,971) | (148,152) |
Property and equipment, net | 441,338 | 445,252 |
Restricted cash (Note 4) | 2,047 | 1,941 |
Marketable securities (Note 3) | 746,464 | 262,009 |
License agreements, net | 15,400 | 16,013 |
Noncurrent deferred income tax (Note 6) | 20,498 | 9,840 |
Other intangible assets | 206,256 | 214,941 |
Total assets | 3,825,874 | 2,934,421 |
Current liabilities: | ||
Accounts payable | 203,388 | 160,094 |
Salaries and benefits payable | 45,236 | 34,241 |
Accrued warranty costs | 87,424 | 87,408 |
Accrued sales program costs | 119,150 | 90,337 |
Deferred revenue | 27,910 | 680 |
Accrued royalty costs | 103,195 | 30,941 |
Accrued advertising expense | 34,146 | 31,071 |
Other accrued expenses | 40,373 | 24,329 |
Income taxes payable | 22,846 | 20,075 |
Total current liabilities | 683,668 | 479,176 |
Deferred income taxes (Note 6) | 10,170 | 13,910 |
Non-current income taxes | 255,748 | 214,366 |
Non-current deferred revenue | 38,574 | 0 |
Other liabilities | 1,267 | 1,115 |
Stockholders' equity: | ||
Common stock, $0.005 par value, 1,000,000,000 shares authorized (Notes 9, 10, and 11): Issued and outstanding shares - 200,274,000 in 2009, and 200,363,000 in 2008 | 1,001 | 1,002 |
Additional paid-in capital | 32,221 | 0 |
Retained earnings (Note 2) | 2,816,607 | 2,262,503 |
Accumulated other comprehensive gain/(loss) | (13,382) | (37,651) |
Total stockholders' equity | 2,836,447 | 2,225,854 |
Total liabilities and stockholders' equity | $3,825,874 | $2,934,421 |
Consolidated Balance Sheets [Pa
Consolidated Balance Sheets [Parenthetical] (USD $) | ||
In Thousands, except Share data | Dec. 26, 2009
| Dec. 27, 2008
|
Consolidated Balance Sheets [Parenthetical] | ||
Allowance for Doubtful Accounts | $36,673 | $42,409 |
Common Stock, Par or Stated Value Per Share | 0.005 | 0.005 |
Common Stock, Shares Authorized | 1,000,000,000 | 1,000,000,000 |
Common Stock, Shares, Issued | 200,274,000 | 200,363,000 |
Common Stock, Shares, Outstanding | 200,274,000 | 200,363,000 |
Consolidated Statements of Inco
Consolidated Statements of Income (USD $) | |||
In Thousands, except Per Share data | 12 Months Ended
Dec. 26, 2009 | 12 Months Ended
Dec. 27, 2008 | 12 Months Ended
Dec. 29, 2007 |
Net sales | $2,946,440 | $3,494,077 | $3,180,319 |
Cost of goods sold | 1,502,329 | 1,940,562 | 1,717,064 |
Gross profit | 1,444,111 | 1,553,515 | 1,463,255 |
Advertising expense | 155,521 | 208,177 | 206,948 |
Selling, general and administrative expenses | 264,202 | 277,212 | 189,550 |
Research and development expense | 238,378 | 206,109 | 159,406 |
Total operating expense | 658,101 | 691,498 | 555,904 |
Operating income | 786,010 | 862,017 | 907,351 |
Other income (expense): | |||
Interest income | 23,519 | 35,535 | 41,995 |
Interest expense | 0 | (607) | (207) |
Foreign currency | (6,040) | (35,286) | 22,964 |
Gain on sale of equity securities | 2,741 | 50,884 | 5,101 |
Other | 2,421 | 1,823 | 1,069 |
Total other income | 22,641 | 52,349 | 70,922 |
Income before income taxes | 808,651 | 914,366 | 978,273 |
Income tax provision (benefit): (Note 6) | |||
Current | 128,036 | 136,252 | 179,355 |
Deferred | (23,335) | 45,266 | (56,093) |
Total income tax provision, net | 104,701 | 181,518 | 123,262 |
Net income | $703,950 | $732,848 | $855,011 |
Basic net income per share (Note 10) | 3.51 | 3.51 | 3.95 |
Diluted net income per share (Note 10) | 3.5 | 3.48 | 3.89 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (USD $) | |||||
In Thousands | Additional Paid-In Capital
| Common Stock
| Retained Earnings
| Accumulated Other Comprehensive Gain/(Loss)
| Total
|
Balances, Value at Dec. 30, 2006 | $83,438 | $1,082 | $1,478,654 | ($5,275) | $1,557,899 |
Balances, Shares at Dec. 30, 2006 | 216,098 | ||||
Net income | 855,011 | 855,011 | |||
Translation adjustment | 992 | 992 | |||
Adjustment related to unrealized gains (losses) on available-for-sale securities, net of income tax effects | 50,413 | 50,413 | |||
Dividends paid | (162,531) | (162,531) | |||
Tax benefit from exercise of employee stock options | 17,434 | 17,434 | |||
Issuance of common stock from exercise of stock options, Shares | 819 | ||||
Issuance of common stock from exercise of stock options, Value | 11,278 | 4 | 11,282 | ||
Stock appreciation rights | 22,164 | 22,164 | |||
Purchase and retirement of common stock, Shares | (57) | ||||
Purchase and retirement of common stock, Value | (7,780) | (7,780) | |||
Issuance of common stock through stock purchase plan, Shares | 120 | ||||
Issuance of common stock through stock purchase plan, Value | 5,730 | 5,730 | |||
Balances, Shares at Dec. 29, 2007 | 216,980 | ||||
Balances, Value at Dec. 29, 2007 | 132,264 | 1,086 | 2,171,134 | 46,130 | 2,350,614 |
Net income | 732,848 | 732,848 | |||
Translation adjustment | (3,053) | (1,595) | (14,991) | (19,639) | |
Adjustment related to unrealized gains (losses) on available-for-sale securities, net of income tax effects | (68,790) | (68,790) | |||
Dividends paid | (150,251) | (150,251) | |||
Tax benefit from exercise of employee stock options | 2,143 | 2,143 | |||
Issuance of common stock from exercise of stock options, Shares | 158 | ||||
Issuance of common stock from exercise of stock options, Value | 2,873 | 2 | 2,875 | ||
Stock appreciation rights | 38,872 | 38,872 | |||
Purchase and retirement of common stock, Shares | (17,138) | ||||
Purchase and retirement of common stock, Value | (182,128) | (86) | (489,633) | (671,847) | |
Issuance of common stock through stock purchase plan, Shares | 363 | ||||
Issuance of common stock through stock purchase plan, Value | 9,029 | 9,029 | |||
Balances, Shares at Dec. 27, 2008 | 200,363 | 200,363 | |||
Balances, Value at Dec. 27, 2008 | 1,002 | 2,262,503 | (37,651) | 2,225,854 | |
Net income | 703,950 | 703,950 | |||
Translation adjustment | 24,537 | 24,537 | |||
Adjustment related to unrealized gains (losses) on available-for-sale securities, net of income tax effects | (268) | (268) | |||
Dividends paid | (149,846) | (149,846) | |||
Tax benefit from exercise of employee stock options | 1,366 | 1,366 | |||
Issuance of common stock from exercise of stock options, Shares | 409 | ||||
Issuance of common stock from exercise of stock options, Value | 3,781 | 3 | 3,784 | ||
Stock appreciation rights | 43,616 | 43,616 | |||
Purchase and retirement of common stock, Shares | (708) | ||||
Purchase and retirement of common stock, Value | (20,254) | (4) | (20,258) | ||
Issuance of common stock through stock purchase plan, Shares | 210 | ||||
Issuance of common stock through stock purchase plan, Value | 3,712 | 3,712 | |||
Balances, Shares at Dec. 26, 2009 | 200,274 | 200,274 | |||
Balances, Value at Dec. 26, 2009 | $32,221 | $1,001 | $2,816,607 | ($13,382) | $2,836,447 |
1_Consolidated Statements of St
Consolidated Statements of Stockholders' Equity (Parenthetical) (USD $) | |||
In Thousands | 12/28/2008 - 12/26/2009
| 12/30/2007 - 12/27/2008
| 12/31/2006 - 12/29/2007
|
Consolidated Statements of Stockholders' Equity (Parenthetical) | |||
Other Comprehensive Income, Available-for-sale Securities, Tax, Portion Attributable to Parent, Total | $150 | $150 | $31 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (USD $) | |||
In Thousands | 12 Months Ended
Dec. 26, 2009 | 12 Months Ended
Dec. 27, 2008 | 12 Months Ended
Dec. 29, 2007 |
Operating Activities: | |||
Net income | $703,950 | $732,848 | $855,011 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation | 56,695 | 46,910 | 35,524 |
Amortization | 39,791 | 31,507 | 28,513 |
Loss on sale of property and equipment | (14) | 124 | 560 |
Provision for doubtful accounts | (1,332) | 32,355 | 3,617 |
Provision for obsolete and slow-moving inventories | 61,323 | 24,461 | 34,975 |
Unrealized foreign currency losses/(gains) | 7,480 | 15,887 | (926) |
Deferred income taxes | (25,096) | 50,887 | (57,843) |
Stock compensation | 43,616 | 38,872 | 22,164 |
Realized gains on marketable securities | (2,741) | (50,884) | (5,101) |
Changes in operating assets and liabilities, net of acquisition: | |||
Accounts receivable | (131,978) | 206,101 | (477,108) |
Inventories | 61,189 | 83,035 | (224,180) |
Prepaid expenses and other current assets | 2,740 | (4,356) | 6,213 |
License fees | (13,735) | (15,289) | (23,569) |
Accounts payable | 38,875 | (236,287) | 174,781 |
Other current and non-current liabilities | 172,215 | (4,507) | 253,909 |
Deferred revenue | 65,706 | 680 | 0 |
Income taxes payable | 15,772 | (90,180) | 55,548 |
Net cash provided by operating activities | 1,094,456 | 862,164 | 682,088 |
Investing activities: | |||
Purchases of property and equipment | (49,199) | (119,623) | (156,777) |
Proceeds from sale of property and equipment | 5 | 19 | 5 |
Purchase of intangible assets | (7,573) | (6,971) | (2,918) |
Purchase of marketable securities | (776,966) | (373,580) | (1,672,041) |
Redemption of marketable securities | 285,970 | 504,324 | 1,784,816 |
Acquisitions, net of cash acquired | 0 | (60,131) | (128,751) |
Change in restricted cash | (106) | (387) | (29) |
Net cash used in investing activities | (547,869) | (56,349) | (175,695) |
Financing activities: | |||
Dividends | (149,846) | (150,251) | (162,531) |
Payment on long-term debt | 0 | 0 | (248) |
Proceeds from issuance of common stock through stock purchase plan | 3,712 | 9,029 | 5,730 |
Proceeds from issuance of common stock from exercise of stock options | 3,783 | 2,875 | 11,278 |
Tax benefit related to stock option exercise | 1,366 | 2,143 | 17,434 |
Purchase of common stock | (20,258) | (671,847) | (7,780) |
Net cash used in financing activities | (161,243) | (808,051) | (136,117) |
Effect of exchange rate changes on cash and cash equivalents | 9,902 | (9,118) | 92 |
Net increase/(decrease) in cash and cash equivalents | 395,246 | (11,354) | 370,368 |
Cash and cash equivalents at beginning of year | 696,335 | 707,689 | 337,321 |
Cash and cash equivalents at end of year | 1,091,581 | 696,335 | 707,689 |
Supplemental disclosures of cash flow information | |||
Cash paid during the year for income taxes | 69,186 | 134,421 | 54,963 |
Cash received during the year from income tax refunds | 2,934 | 177 | 779 |
Cash paid during the year for interest | 0 | 607 | 207 |
Supplemental disclosure of non-cash investing and financing activities | |||
Change in marketable securities related to unrealized appreciation (depreciation) | 408 | (68,668) | 51,210 |
Fair value of assets acquired | 0 | 136,952 | 256,609 |
Liabilities assumed | 0 | (60,336) | (106,654) |
Less: cash acquired | 0 | (16,485) | (21,204) |
Net cash paid | $0 | $60,131 | $128,751 |
Description of the Business
Description of the Business | |
12 Months Ended
Dec. 26, 2009 USD / shares | |
Description of Business [Abstract] | |
Description of the Business | 1. Description of the Business Garmin Ltd. and subsidiaries (together, the Company) manufacture, market, and distribute Global Positioning System-enabled products and other related products.Garmin Corporation (GC), wholly-owned by Garmin Ltd., is primarily responsible for the manufacturing and distribution of the Companys products to Garmin International, Inc. (GII), a wholly-owned subsidiary of GC, and Garmin (Europe) Limited (GEL), a wholly-owned subsidiary of Garmin Ltd., and, to a lesser extent, new product development and sales and marketing of the Companys products in Asia and the Far East.GII is primarily responsible for sales and marketing of the Companys products in many international markets and in the United States as well as research and new product development. GII also manufactures certain products for the Companys aviation segment.GEL is responsible for sales and marketing of the Companys products, principally within the European market.In addition, the Company acquired ten European distributors in 2007 and 2008 which distribute Garmin product throughout Europe. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | |
12 Months Ended
Dec. 26, 2009 USD / shares | |
Summary of Significant Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2.Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States.The accompanying consolidated financial statements reflect the accounts of Garmin Ltd. and its wholly owned subsidiaries. All significant inter-company balances and transactions have been eliminated.Prior year reclassifications have been made between noncurrent deferred tax liabilities and noncurrent deferred tax assets to reflect the net tax position in various jurisdictions and between deferred revenue and other accrued expenses to reflect the 2008 balance. The change was not material. Fiscal Year The Company has adopted a 5253-week period ending on the last Saturday of the calendar year. Due to the fact that there are not exactly 52 weeks in a calendar year and there is slightly more than one additional day per year (not including the effects of leap year) in each calendar year as compared to a 52-week fiscal year, the Company will have a fiscal year comprising 53 weeks in certain fiscal years, as determined by when the last Saturday of the calendar year occurs. In those resulting fiscal years that have 53 weeks, the Company will record an extra week of sales, costs, and related financial activity. Therefore, the financial results of those fiscal years, and the associated 14-week fourth quarter, will not be entirely comparable to the prior and subsequent 52-week fiscal years and the associated quarters having only 13 weeks.Fiscal 2009, 2008, and 2007 included 52 weeks. Foreign Currency Translation Many Garmin Ltd. subsidiaries utilize currencies other than the United States Dollar (USD) as their functional currency.As required by the Foreign Currency Matters topic of the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC), the financial statements of these subsidiaries for all periods presented have been translated into USD, the functional currency of Garmin Ltd. and GII, and the reporting currency herein, for purposes of consolidation at rates prevailing during the year for sales, costs, and expenses and at end-of-year rates for all assets and liabilities. The effect of this translation is recorded in a separate component of stockholders equity. Cumulative translation adjustments of $9,231 and ($15,306) as of December 26, 2009 and December 27, 2008, respectively, net of related taxes, have been included in accumulated other comprehensive gain/(loss) in the accompanying consolidated balance sheets. Transactions in foreign currencies are recorded at the approximate rate of exchange at the transaction date. Assets and liabilities resulting from these transactions are translated at the rate of exchange in effect at the balance sheet date. All differences are recorded in results of operations and amounted to exchange gains/(losses) of ($6,040), ($35,286), and $22,964 for the years ended December 26, 2009, December 27, 2008, and December 29, 2007, respectively.The loss in fiscal 2009 was primarily the result of the weakening of the USD again |
Marketable Securities
Marketable Securities | |
12 Months Ended
Dec. 26, 2009 USD / shares | |
Marketable Securities [Abstract] | |
Marketable Securities | 3. Marketable Securities The FASB ASC topic entitled Fair Value Measurements and Disclosures defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price).The accounting guidance classifies the inputs used to measure fair value into the following hierarchy: Level 1 Unadjusted quoted prices in active markets for identical assets or liability Level 2 Unadjusted quoted prices in active markets for similar assets or liabilities, or Unadjusted quoted prices for identical or similar assets Level 3 Unobservable inputs for the asset or liability The Company endeavors to utilize the best available information in measuring fair value.Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. For fair value measurements using significant unobservable inputs, an independent third party provided the valuation.The inputs used in the valuations used the following methodology.The collateral composition was used to estimate Weighted Average Life based on historical and projected payment information.Cash flows were projected for the issuing trusts, taking into account underlying loan principal, bonds outstanding, and payout formulas.Taking this information into account, assumptions were made as to the yields likely to be required, based upon then current market conditions for comparable or similar term Asset Based Securities as well as other fixed income securities. Assets and liabilities measured at estimated fair value on a recurring basis are summarized below: FairValueMeasurementsas ofDecember26,2009 Description Total Level1 Level2 Level3 Available for-sale securities $ 695,795 $ 695,795 $ - $ - Failed Auction rate securities $ 70,252 $ 70,252 Total $ 766,047 $ 695,795 $ - $ 70,252 FairValueMeasurementsas ofDecember27,2008 Description Total Level1 Level2 Level3 Available for-sale securities $ 203,592 $ 203,592 $ - $ - Failed Auction rate securities $ 71,303 $ 71,303 Total $ 274,895 $ 203,592 $ - $ 71,303 All Level 3 investments have been in a continuous unrealized loss position for 12 months or longer.For assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the period, the accounting guidance requires a reconciliation of the beginning and ending balances, separately for each major category of assets.The reconciliation is as follows: FairValueMeasurementsUsing SignificantUnobservableInputs(Level3) 52-WeeksEnded 52-WeeksEnded December27,2008 December26,2009 Beginning balance of auction rate securities $ 0 $ 71,303 |
Commitments and Contingencies
Commitments and Contingencies | |
12 Months Ended
Dec. 26, 2009 USD / shares | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | 4. Commitments and Contingencies Rental expense related to office, equipment, warehouse space and real estate amounted to $10,293, $8,419, and $5,546 for the years ended December 26, 2009, December 27, 2008, and December 29, 2007, respectively. Future minimum lease payments are as follows: Year Amount 2010 $ 9,105 2011 7,789 2012 6,687 2013 5,882 2014 5,024 Thereafter 6,856 Total $ 41,343 Certain cash balances of GEL are held as collateral by a bank securing payment of the United Kingdom value-added tax requirements. The total amount of restricted cash balances were $2,047 and $1,941 at December 26, 2009 and December 27, 2008, respectively. In the normal course of business, the Company and its subsidiaries are parties to various legal claims, actions, and complaints, including matters involving patent infringement and other intellectual property claims and various other risks. It is not possible to predict with certainty whether or not the Company and its subsidiaries will ultimately be successful in any of these legal matters, or if not, what the impact might be. However, the Companys management does not expect that the results in any of these legal proceedings will have a material adverse effect on the Companys results of operations, financial position or cash flows. |
Employee Benefit Plans
Employee Benefit Plans | |
12 Months Ended
Dec. 26, 2009 USD / shares | |
Employee Benefit Plans [Abstract] | |
Employee Benefit Plans | 5. Employee Benefit Plans GII sponsors a defined contribution employee retirement plan under which its employees may contribute up to 50% of their annual compensation subject to Internal Revenue Code maximum limitations and to which GII contributes a specified percentage of each participants annual compensation up to certain limits as defined in the Plan. Additionally, GEL has a defined contribution plan under which its employees may contribute up to 7.5% of their annual compensation. Both GII and GEL contribute an amount determined annually at the discretion of the Board of Directors. During the years ended December 26, 2009, December 27, 2008, and December 29, 2007, expense related to these plans of $16,399, $14,927, and $11,412, was charged to operations. Certain of the Companys foreign subsidiaries participate in local defined benefit pension plans. Contributions are calculated by formulas that consider final pensionable salaries. Neither obligations nor contributions for the years ended December 26, 2009, December 27, 2008, and December 29, 2007, were significant. |
Income Taxes
Income Taxes | |
12 Months Ended
Dec. 26, 2009 USD / shares | |
Income Taxes [Abstract] | |
Income Taxes | 6. Income Taxes The Companys income tax provision (benefit) consists of the following: FiscalYearEnded December26, December27, December29, 2009 2008 2007 Federal: Current $ 104,186 $ 90,655 $ 132,452 Deferred (12,021 ) 23,639 (42,193 ) 92,165 114,294 90,259 State: Current 5,381 1,318 12,569 Deferred (947 ) 1,090 (2,916 ) 4,434 2,408 9,653 Foreign: Current 18,469 44,279 34,334 Deferred (10,367 ) 20,537 (10,984 ) 8,102 64,816 23,350 Total $ 104,701 $ 181,518 $ 123,262 The income tax provision differs from the amount computed by applying the statutory federal income tax rate to income before taxes. The sources and tax effects of the differences, including the impact of establishing tax contingency accruals, are as follows: FiscalYearEnded December26, December27, December29, 2009 2008 2007 Federal income tax expense at U.S. statutory rate $ 287,228 $ 332,278 $ 342,396 State income tax expense, net of federal tax effect 2,604 2,030 5,922 Foreign tax rate differential (219,482 ) (233,928 ) (230,243 ) Taiwan tax holiday benefit (18,556 ) (24,904 ) (44,128 ) Net change in uncertain tax postions 41,400 87,800 56,100 Other foreign taxes less incentives and credits 10,379 20,428 (117 ) Other, net 1,128 (2,186 ) (6,668 ) Income tax expense $ 104,701 $ 181,518 $ 123,262 The Companys income before income taxes attributable to non-U.S. operations was $678,868, $823,364, and $850,102, for the years ended December 26, 2009, December 27, 2008, and December 29, 2007, respectively. The Taiwan tax holiday benefits included in the table above reflect $0.09, $0.12, and $0.20 per weighted-average common share outstanding for the years ended December 26, 2009, December 27, 2008, and December 29, 2007, respectively. The Company currently expects to benefit from these Taiwan tax holidays through 2013, at which time these tax benefits expire. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Companys deferred tax assets and liabilities are as follows: December26, December27, December29, 2009 2008 2007 Deferred tax assets: Product warranty accruals $ 1,642 $ 1,696 $ 18,975 Allowance for doubtful accounts 15,346 15,098 2,430 Inventory reserves 10,145 5,331 7,699 Sales program allowances 12,902 14,471 42,832 Reserve for sales returns - 2,914 5,565 Other accruals 5,414 5,411 3,911 Unrealized in |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | |
12 Months Ended
Dec. 26, 2009 USD / shares | |
Fair Value of Financial Instruments [Abstract] | |
Fair Value of Financial Instruments | 7. Fair Value of Financial Instruments As required by the Financial Instruments topic of the FASB ASC, the following summarizes required information about the fair value of certain financial instruments for which it is currently practicable to estimate such value. None of the financial instruments are held or issued for trading purposes. The carrying amounts and fair values of the Companys financial instruments are as follows: December26,2009 December27,2008 Carrying Fair Carrying Fair Amount Value Amount Value Cash and cash equivalents $ 1,091,581 $ 1,091,581 $ 696,335 $ 696,335 Restricted cash 2,047 2,047 1,941 1,941 Marketable securities 766,047 766,047 274,895 274,895 For certain of the Companys financial instruments, including accounts receivable, accounts payable and other accrued liabilities, the carrying amounts approximate fair value due to their short maturities. |
Segment Information
Segment Information | |
12 Months Ended
Dec. 26, 2009 USD / shares | |
Segment Information [Abstract] | |
Segment Information | 8. Segment Information The Company operates within its targeted markets through four reportable segments, those being related to products sold into the marine, automotive/mobile, outdoor/fitness, and aviation markets. For external reporting purposes, we aggregate operating segments which have similar economic characteristics, products, production processes, types or classes of customers and distribution methods into reportable segments. All of the Companys reportable segments offer products through the Companys network of independent dealers and distributors as well as through OEMs. However, the nature of products and types of customers for the four reportable segments vary significantly. The Companys marine, automotive/mobile, and outdoor/fitness segments include portable global positioning system (GPS) receivers and accessories sold primarily to retail outlets. These products are produced primarily by the Companys subsidiary in Taiwan. The Companys aviation products are portable and panel mount avionics for Visual Flight Rules and Instrument Flight Rules navigation and are sold primarily to aviation dealers and certain aircraft manufacturers. The Companys Chief Executive Officer has been identified as the Chief Operating Decision Maker (CODM). The CODM evaluates performance and allocates resources based on income before income taxes of each segment.Income before income taxes represents net sales less operating expenses including certain allocated general and administrative costs, interest income and expense, foreign currency adjustments, and other non-operating corporate expenses. The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies. There are no inter-segment sales or transfers. The identifiable assets associated with each reportable segment reviewed by the CODM include accounts receivable and inventories. The Company does not report property and equipment, intangible assets, depreciation and amortization, or capital expenditures by segment to the CODM. Revenues, interest income and interest expense, income before income taxes, and identifiable assets for each of the Companys reportable segments are presented below: FiscalYearEndedDecember26,2009 Outdoor/ Auto/ Aviation Fitness Marine Mobile Total Net sales to external customers $ 245,745 $ 468,924 $ 177,644 $ 2,054,127 $ 2,946,440 Allocated interest income 737 1,836 1,469 19,477 23,519 Allocated interest expense 0 0 0 0 0 Income before income taxes 56,595 206,042 57,430 488,584 808,651 Assets: Accounts receivable 72,904 139,114 52,701 609,391 874,110 Inventories 25,850 49,326 18,687 216,075 309,938 FiscalYearEndedDecember27,2008 Outdoor/ Auto/ Aviation Fitness Marine Mobile Total Net sales to exte |
Stock Compensation Plans
Stock Compensation Plans | |
12 Months Ended
Dec. 26, 2009 USD / shares | |
Stock Compensation Plans [Abstract] | |
Stock Compensation Plans | 9. Stock Compensation Plans Accounting for Stock-Based Compensation The various Company stock compensation plans are summarized below: 2005 Equity Incentive Plan In June 2005, the shareholders adopted an equity incentive plan (the 2005 Plan) providing for grants of incentive and nonqualified stock options, stock appreciation rights (SARs), restricted stock units (RSUs) and/or performance shares to employees of the Company and its subsidiaries, pursuant to which up to 10,000,000 common shares were available for issuance. The stock options and stock appreciation rights vest evenly over a period of five years or as otherwise determined by the Board of Directors or the Compensation Committee and generally expire ten years from the date of grant, if not exercised. During 2009, 2008 and 2007, the Company granted 0, 1,454,050 and 2,838,200 stock appreciation rights, respectively. During 2009, 2008 and 2007, 470,950, 1,043,800, and 0 restricted stock units were granted under the 2005 Plan. In 2009, 2008, and 2007, 0, 30,000 and 0 performance shares were also granted under the 2005 Plan. 2000 Equity Incentive Plan In October 2000, the shareholders adopted an equity incentive plan (the 2000 Plan) providing for grants of incentive and nonqualified stock options, stock appreciation rights (SARs), restricted stock units (RSUs) and/or performance shares to employees of the Company and its subsidiaries, pursuant to which up to 7,000,000 common shares were available for issuance. The stock options and stock appreciation rights vest evenly over a period of five years or as otherwise determined by the Board of Directors or the Compensation Committee and generally expire ten years from the date of grant, if not exercised. During 2009, 2008, and 2007, the Company granted 0, 0, and 20,000 stock appreciation rights. 2000 Non-employee Directors Option Plan Also in October 2000, the stockholders adopted a stock option plan for non-employee directors (the Directors Plan) providing for grants of options for up to 100,000 common shares. The term of each award is ten years. All awards vest evenly over a three-year period. During 2009, 2008 and 2007, options to purchase 34,648, 15,696, and 5,562 shares, respectively, were granted under this plan. In 2009, the stockholders approved an additional 150,000 shares to the plan, making the total shares authorized under the plan 250,000. Stock-Based Compensation Activity A summary of the Companys stock-based compensation activity and related information under the 2005 Equity Incentive Plan, the 2000 Equity Incentive Plan and the 2000 Non-employee Directors Option Plan for the years ended December 26, 2009, December 27, 2008, and December 29, 2007 is provided below: StockOptionsandSARs Weighted-Average ExercisePrice NumberofShares (InThousands) Outstanding at December 30, 2006 $ 29.24 7,726 Granted $ 84.61 2,864 Exercised $ 18.29 (934 ) Forfeited $ 38.11 (125 ) Outstanding at December 29, 2007 $ 46.82 9,531 Granted $ 51.00 1,470 Exercised $ 22.35 |
Earnings Per Share
Earnings Per Share | |
12 Months Ended
Dec. 26, 2009 USD / shares | |
Earnings Per Share [Abstract] | |
Earnings Per Share | 10. Earnings Per Share The following table sets forth the computation of basic and diluted net income per share: FiscalYearEnded December26, December27, December29, 2009 2008 2007 Numerator (in thousands): Numerator for basic and diluted net income per share - net income $ 703,950 $ 732,848 $ 855,011 Denominator (in thousands): Denominator for basic net income per share -weighted-average common shares 200,395 208,993 216,524 Effect of dilutive securities -employee stock-based awards 766 1,687 3,351 Denominator for diluted net income per share -weighted-average common shares 201,161 210,680 219,875 Basic net income per share $ 3.51 $ 3.51 $ 3.95 Diluted net income per share $ 3.50 $ 3.48 $ 3.89 Options to purchase 7,814,000, 5,846,000, and 886,000 common shares were outstanding during 2009, 2008, and 2007 respectively, but were not included in the computation of diluted earnings per share because the effect was antidilutive. |
Share Repurchase Program
Share Repurchase Program | |
12 Months Ended
Dec. 26, 2009 USD / shares | |
Share Repurchase Program [Abstract] | |
Share Repurchase Program | 11. Share Repurchase Program The Board of Directors approved a share repurchase program on October 22, 2008, authorizing the Company to purchase up to $300 million of its common shares as market and business conditions warrant. The share repurchase authorization expired on December 31, 2009. From inception to expiration, $60 million of common shares were repurchased and retired under this plan. The Board of Directors approved a share repurchase program on June 6, 2008, authorizing the Company to purchase up to 10,000,000 of its common shares as market and business conditions warrant. The share repurchase authorization expired on December 31, 2009. During fiscal 2008, 10,000,000 shares were repurchased and retired under this plan. The Board of Directors approved a share repurchase program on February 4, 2008, authorizing the Company to purchase up to 5,000,000 of its common shares as market and business conditions warrant. The share repurchase authorization expired on December 31, 2009. During fiscal 2008, 5,000,000 shares were repurchased and retired under this plan. The Board of Directors approved a share repurchase program on August 3, 2006, authorizing the Company to purchase up to 3,000,000 of its common shares as market and business conditions warrant. The share repurchase authorization expired on December 31, 2007. From inception to expiration, 1,212,535 shares were repurchased and retired under this plan. |
Shareholder Rights Plan
Shareholder Rights Plan | |
12 Months Ended
Dec. 26, 2009 USD / shares | |
Shareholder Rights Plan [Abstract] | |
Shareholder Rights Plan | 12. Shareholder Rights Plan On October 24, 2001, Garmins Board of Directors adopted a shareholder rights plan (the Rights Plan). Pursuant to the Rights Plan, the Board declared a dividend of one preferred share purchase right on each outstanding common share of Garmin to shareholders of record as of November 1, 2001. The rights trade together with Garmins common shares. The rights generally will become exercisable if a person or group acquires or announces an intention to acquire 15% or more of Garmins outstanding common shares. Each right (other than those held by the new 15% shareholder) will then be exercisable to purchase preferred shares of Garmin (or in certain instances other securities of Garmin) having at that time a market value equal to two times the then current exercise price. Garmins Board of Directors may redeem the rights at $0.001 per right at any time before the rights become exercisable. The rights expire on October 31, 2011. |
Selected Quarterly Information
Selected Quarterly Information | |
12 Months Ended
Dec. 26, 2009 USD / shares | |
Selected Quarterly Information [Abstract] | |
Selected Quarterly Information | 13. Selected Quarterly Information (Unaudited) FiscalYearEndedDecember26,2009 QuarterEnding March28 June27 September26 December26 Net sales $ 436,699 $ 669,104 $ 781,254 $ 1,059,383 Gross profit 195,995 351,614 409,742 486,760 Net income 48,538 161,871 215,133 278,408 Basic net income per share $ 0.24 $ 0.81 $ 1.07 $ 1.39 FiscalYearEndedDecember27,2008 QuarterEnding March29 June28 September27 December27 Net sales $ 663,805 $ 911,671 $ 870,355 $ 1,048,246 Gross profit 320,115 417,128 385,639 430,633 Net income 147,779 256,092 171,244 157,733 Basic net income per share $ 0.68 $ 1.20 $ 0.83 $ 0.78 The above quarterly financial data is unaudited, but in the opinion of management, all adjustments necessary for a fair presentation of the selected data for these interim periods presented have been included. These results are not necessarily indicative of future quarterly results. |
Warranty Reserves
Warranty Reserves | |
12 Months Ended
Dec. 26, 2009 USD / shares | |
Warranty Reserves [Abstract] | |
Warranty Reserves | 14. Warranty Reserves The Companys products sold are generally covered by a warranty for periods ranging from one to two years. The Companys estimate of costs to service its warranty obligations are based on historical experience and expectation of future conditions and are recorded as a liability on the balance sheet. The following reconciliation provides an illustration of changes in the aggregate warranty reserve: Fiscal Year Ended December 26, December 27, December 29, 2009 2008 2007 Balance - beginning of period $ 87,408 $ 71,636 $ 37,639 Accrual for products sold during the period 164,909 132,644 98,702 Expenditures (164,893 ) (116,872 ) (64,705 ) Balance - end of period $ 87,424 $ 87,408 $ 71,636 |
Subsequent Events
Subsequent Events | |
12 Months Ended
Dec. 26, 2009 USD / shares | |
Subsequent Events [Abstract] | |
Subsequent Events | 15. Subsequent Events On February 12, 2010, the Board of Directors approved a share repurchase program authorizing the Company to repurchase up to $300 million of the common shares of Garmin Ltd. The repurchases may be made from time to time as market and business conditions warrant on the open market or in negotiated transactions in compliance with the SECs Rule 10b-18. The timing and amounts of any repurchases will be determined by the Companys management depending on market conditions and other factors including price, regulatory requirements and capital availability. The program does not require the purchase of any minimum number of shares and may be suspended or discontinued at any time. The share repurchase authorization expires on December 31, 2010. The Company evaluated subsequent events through the time of filing this Annual Report on Form 10-K on February 24, 2010. |
Schedule II - Valuation and Qua
Schedule II - Valuation and Qualifying Accounts | |
12 Months Ended
Dec. 26, 2009 USD / shares | |
Schedule II - Valuation and Qualifying Accounts [Abstract] | |
Schedule II - Valuation and Qualifying Acounts | SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS Garmin Ltd. and Subsidiaries (In thousands) Additions Balanceat Chargedto Chargedto Balanceat Beginningof Costsand Other Endof Description Period Expenses Accounts Deductions Period Year Ended December 26, 2009: Deducted from asset accounts Allowance for doubtful accounts $ 42,409 $ (1,332 ) - $ (4,404 ) $ 36,673 Inventory reserve 23,204 61,324 - (45,630 ) $ 38,898 Deferred tax asset 34,487 1,468 - (338 ) 35,617 Total $ 100,100 $ 61,460 - $ (50,372 ) $ 111,188 Year Ended December 27, 2008: Deducted from asset accounts Allowance for doubtful accounts $ 10,246 $ 32,355 - $ (192 ) $ 42,409 Inventory reserve 31,186 24,461 - (32,443 ) 23,204 Deferred tax asset 15,491 18,996 - - 34,487 Total $ 56,923 $ 75,812 - $ (32,635 ) $ 100,100 Year Ended December 29, 2007: Deducted from asset accounts Allowance for doubtful accounts $ 5,340 $ 3,617 - $ 1,289 $ 10,246 Inventory reserve 19,768 34,975 - (23,557 ) 31,186 Deferred tax asset 28,301 1,486 - (14,296 ) 15,491 Total $ 53,409 $ 40,078 - $ (36,564 ) $ 56,923 |
Document Information
Document Information | |
12 Months Ended
Dec. 26, 2009 USD / shares | |
Document Information [Line Items] | |
Document Type | 10-K |
Amendment Flag | false |
Document Period End Date | 2009-12-26 |
Entity Information
Entity Information (USD $) | |||
12 Months Ended
Dec. 26, 2009 | Feb. 22, 2010
| Jun. 27, 2009
| |
Entity Information [Line Items] | |||
Entity Registrant Name | Garmin Ltd. | ||
Entity Central Index Key | 0001121788 | ||
Current Fiscal Year End Date | --12-26 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $2,975,580,700 | ||
Entity Common Stock, Shares Outstanding | 200,344,095 |