Net income of $93 million gives hope, even though the company warns of rough times ahead.
By Kathleen Maher
Of the companies transforming themselves lately, Trimble (NASDAQ: TRMB) has made the latest moves and some of the most spectacular with the acquisition of Tekla and of Google’s SketchUp. Most recently the company has announced a new rugged tablet for field work and another acquisition—Vico Software—that takes the company deeper into BIM.
The company reported third-quarter revenue of $504.8 million, a 21% increase compared to the same period last year. The company’s income was $53.4 million, a 91% increase compared to the third quarter of 2011.
Trimble’s president and CEO, Steven Berglund, notes the company has seen significant organic growth and well as growth through acquisition, and adds all reporting segments saw gains. Like all other CEOs in CAD and PLM related fields, Berglund too has warned investors about the uncertain shoals ahead. He says that near-term prospects are uncertain but the quarter’s results reinforce their expectation of sustainable market and financial success.
Trimble has four major reporting segments. The largest is Engineering and Construction, followed by Field Solutions, Mobile Solutions, and Advanced Devices. The company’s roots are in surveying and navigation. Many of the company’s most recent acquisitions have been in Engineering and Acquisition, and they helped bring the segment to $287.2 million in this quarter, a 19% increase over the same period in 2011. The increase came from sales of heavy civil construction and highway and vertical construction products and acquisitions.
In field solutions, Trimble brought in $103 million in revenue, a 13% year-over-year increase, due to the sales of agricultural products.
In Mobile Solutions, Trimble reported $83.8 million in revenue, a 44% increase year over year. Acquisitions helped here and so did subscription revenue.
And, Advanced Devices reported $30.7 million, a 13% increase compared to last year. The increase was due to sales of timing devices.
Trimble says revenue for the fourth quarter will be between $503 and $508 million. The company says that excluding the negative effects of currency, Trimble’s organic growth was in the high teens, and the company reports their largest operating margins ever at 55%.
In his comments to investors, Berglund said that it looks as if the U.S. is moving into the early stages of recovery. The growth Trimble has experienced in Engineering and Construction is driven partly by an increase in North American commercial and residential construction as well as some increase international markets.
On the acquisition front Trimble has most recently acquired TMW Systems, a privately held company that sells transport and logistics enterprise software. Trimble is buying the company for $335 million in cash. This deal is going to affect Trimble’s bottom line slightly, and it has to adjust its forecasts accordingly. In this quarter, the company has also announced the acquisition of Vico Software, a BIM company that enables connections to work in the field. Vico’s Virtual Construction Software enables placement of structural, architectural, mechanical, electrical, and plumbing engineering systems in the construction model. Trimble is calling the technology 5D-capable 3D models plus time and place.
And last but hardly least, Trimble also announced the arrival of the Yuma 2 rugged tablet computer. Designed for work in the field for construction, transportation, public safety, field service, forestry, utilities, mapping, insurance, etc., it’s a device with a 7-inch touch screen, weighing less than 3 pounds. It has 3.75G dual-mode cellular data capability with support for GSM and CDMA. It’s based on Windows 7 and has a 1.6-GHz Intel Atom dual-core with 4 GB of DDR DRAM, a 64-GB solid-state drive, and a dual battery for 8 hours of run time. Customers can interact with the touch screen with fingers, stylus, or capacitive gloves. And of course it has a GPS receiver with 2- to 4-meter accuracy. Trimble has not announced a price yet as far as we could tell, but the previous generation, Yuma sold in the range of $4,000 and up.
Another BIM acquisition for Trimble