Garmin Ltd. reported that revenue at its Outdoor segment increased 24 percent to $100 million, while Fitness revenues increased 5 percent to $82 million in the second quarter. The company, which also operates Aviation and Marine segments, reported overall sales increase 7 percent to $718 million.

 

In the Outdoor segment growth was driven by golf, dog tracking and training products and Garmin's recently refreshed eTrex series. During the quarter, the company introduced its latest outdoor product, the fçnix wristwatch, which offers both a feature-rich experience for the outdoorsman and also a classic style for everyday use.

The fitness segment posted revenue growth of 5 percent in the quarter compared against strong performance in 2011 driven by promotional activity on the Forerunner 305 and the launch of the Forerunner 610. In the current quarter, new products such as the high-end Forerunner 910XT sold well and drove margin expansion for the fitness segment.

 

“In late June, we introduced the Garmin Swim C targeting a new niche for us in the fitness market,” said Dr. Min Kao, chairman and chief executive officer of Garmin Ltd. “The product has already been well-received in the swimming community. We anticipate growth rates will improve in the second half of 2012 as we launch new products for the holiday season to drive further market penetration.”

 

Garmin's revenue in the Americas reached $392 million, up 9 percent; $269 million in Europe, the Middle East and Africa, up 6 percent; and $57 million in the Asia Pacific, down 9 percent.

 

Year-to-date Outdoor segment revenue increased 20 percent to $178 million, while Fitness segment revenue increased 14 percent to $153 million. That compared to a 4 percent increase in Aviation segment to  $149 million, a 5 percent increase in the Marine segment to $124 million.

“In the second quarter of 2012 we again posted strong revenue, unit volumes, and operating income even though the global economy is still difficult,” said Kao. “We have had a great first half; yet, we remain cautious given the macroeconomic dynamics facing each of our segments. Based on our first half performance, we are narrowing our full year revenue guidance to $2.75 – $2.80 billion. This represents the high end of our prior range with improvement in auto/mobile and outdoor offset by the remaining segments. We are increasing our EPS guidance to $2.70 – $2.85 due to the outstanding margins in the first half. Overall, we believe we are executing well in both the current environment and in preparation for long-term sustained growth.













































































2012 Guidance Update
    
     

 
 

 

 

 

 

 

 



 


 


 

 

 

 

 

2012



 


 


 

Revenue

 

 

 

$2.75 C 2.80 B



 


 


 

Gross Margin

 

 

 

52-53%



 


 


 

Operating Margin

 

 

 

21-22%



 


 


 

EPS (Pro Forma)

 

 

 

$2.70 – $2.85



 


 


 


 


 


 


 

 



“We now expect revenue in 2012 between $2.75 and $2.80 billion as strong results in auto/mobile and outdoor are partially offset by macroeconomic headwinds for other business segments. Due to the strong first half margin performance in our automotive/mobile, outdoor and fitness segments, we are increasing our EPS range to $2.70 – $2.85. We still anticipate an effective tax rate of approximately 13% for the full year.”