The company posted double-digit revenue growth for the quarter in its fitness, aviation, outdoor and marine segments, offsetting a 4% decline in its automotive/mobile segment. Year-over-year growth in the fitness segment equaled 38%, totaling slightly more than $100 million. Fitness has now passed aviation as the company’s second largest segment, though it still trails well behind the automotive/mobile section, which posted revenues of nearly $243 million.
Garmin offered no guidance in its press release, saying that the first quarter is traditionally the company’s weakest and that it will provide updated guidance when it reports second-quarter results. At the end of the fourth-quarter, Garmin guided revenue in a range of $2.6 billion to $2.7 billion and EPS at $2.50 to $2.60. Overall gross margins were forecast at 54% to 55%, and operating margin is estimated at approximately 21%. The current consensus estimates call for full-year EPS of $2.63 on revenues of $2.64 billion.
The company’s CEO said:
The markets that we serve are dynamic and competitive so we must capitalize on our strong portfolio of products in 2014 while also identifying new opportunities and innovations that will provide future growth potential.
Garmin reiterated its statement from the end of the fourth quarter that it plans to recommend an increase in its yearly dividend from $1.80 to $1.92 at the June annual meeting. If approved, the new dividend rate would be payable beginning in the second quarter of this year.
Garmin shares were up about 5% Wednesday morning, at $57.81 in a 52-week range of $33.12 to $59.55. Thomson Reuters had a consensus analyst price target of around $55.40 before the report. Year-to-date, Garmin’s stock price is up nearly 23%, and for the trailing 12 months the shares are up about 57%.
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