Garmin 2005 Annual Report Download - page 100

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70
The purchase price of the UPS Aviation Technologies acquisition was allocated to the estimated fair values
of assets acquired and liabilities assumed based on management’s estimates and third-party appraisals. The excess
purchase price over the fair value of the net assets acquired was allocated to deductible goodwill in the amount of
$11.4 million. UPS Aviation Technologies, Inc. was subsequently renamed Garmin AT, Inc. by the Company. The
results of Garmin AT, Inc. are included in the financial statements for the periods subsequent to August 22, 2003.
The following table summarizes the purchase price allocation and the useful life of intangibles for the
aforementioned acquisition:
The following table is prepared on a pro forma basis for the fiscal year ended December 27, 2003 as though
the business had been acquired as of the beginning of the period presented, after including the estimated impact of
certain adjustments such as amortization of intangibles:
The pro forma results are not necessarily indicative of what would have occurred if the acquisition had
been in effect for the periods presented. In addition, they are not intended to be a projection of future results and do
not reflect any synergies that might be achieved from combining the operations.
15. Warranty Reserves
The Company’s products sold are generally covered by a warranty for periods ranging from one to two
years. The Company’s estimate of costs to service its warranty obligations are based on historical experience and
expectation of future conditions and are recorded as a liability on the balance sheet. The following reconciliation
provides an illustration of changes in the aggregate warranty reserve:
Intangibles
Amount Useful Life (years)
Working capital $8,562
Fixed assets 7,092
Intangibles:
Technology / Patents 4,151 8
Tradenames 824 3
Non-Competition Agreements 2,122 4
Customer Contracts 292 3
Customer Relationships 3,344 10
Order Backlogs 372 3
Goodwill 11,418
Purchase price paid, net of cash acquired $38,177
Fiscal Year Ended
December 27,
2003
(Unaudited)
Net sales $591,050
Net income after income taxes 178,524
Basic net income per share 1.65
Diluted net income per share 1.64