Garmin (GRMN) expects 2014 revenue of $2.6B-$2.7B and EPS of $2.50-$2.60. While the latter is only in-line with a $2.56 consensus, the former is above a $2.58B consensus.
Garmin also announces: 1) It's hiking its quarterly dividend by $0.02 to $0.48/share. Garmin now sports a 3.6% yield. 2) Kevin Rauckman, the company's CFO/treasurer since its 2000 IPO, will be leaving within the next year. Garmin will search for a replacement.
Q4 results trounced estimates with the help of a 25% Y/Y increase in aviation product sales, up from 15% in Q3. Automotive/mobile sales, which still accounted for nearly half of 2013 sales, fell 12% in seasonally strong Q4 vs. 16% in Q3. Outdoor sales +7% vs. -4% in Q3, fitness +14% vs. +25%, marine +13% vs. +24%.
Gross margin rose 300 bps Y/Y in Q4 to 52%. Garmin projects a 2014 GM of 54%-55%, up from a 2013 level of 53%. Op. margin is expected to slip to 21% from 2013's 22% due to R&D investments.
While total opex fell 1% Y/Y in Q4 due to a 28% drop in ad spend to $34.9M, R&D spend rose 11% to $92.6M. $31M was spent on buybacks.
Q4 results, PR