Garmin reports quarterly increases in profit and revenue

Garmin Ltd. on Wednesday reported fourth-quarter gains in profit and revenue, pumped up by a 70 percent increase in the sale of activity trackers and other fitness products.

The company, whose operating headquarters are in Olathe, earned $210.2 million in the final quarter of 2014 that ended Dec. 27, up from a profit of $163.6 million in the year-earlier period.

Revenue climbed in the fourth quarter to $803.3 million from $759.7 million the prior year.

Garmin, the maker of a broad product line that relies on Global Positioning System technology, reported an 11 percent decrease in sales in its automotive business to $339.8 million. The outdoor products segment fell 8 percent to $116.4 million.

However, those weaknesses were more than offset in the quarter by the surge in its fitness lineup, which accounted for $201.3 million in sales.

The company also reported sales increases during the quarter in its marine and aviation markets.

Those non-automotive-mobile segments of its business accounted for 58 percent of Garmin’s revenues in the fourth quarter, reflecting sales trends from previous quarters.

For the year, Garmin posted a profit of $364.2 million on revenue of $2.9 billion.

“We have redefined our earnings power as a company and further diversified our operating profit base,” Cliff Pemble, Garmin’s president and CEO, said in the earnings release.

In 2015, the company said it expects revenue of about $2.9 billion as “growth in the fitness, marine and aviation segments offset ongoing declines” in its car navigation line. Garmin also said currency volatility is expected to slow revenue growth this year.

However, Garmin expects its fitness business to again be the largest contributor to sales growth, thanks to the launch of several new products such as a GPS-enabled smartwatch.

Garmin also said it plans to repurchase up to $300 million of its shares through 2016.

This story was originally published February 18, 2015 at 3:21 PM with the headline "Garmin reports quarterly increases in profit and revenue."