Garmin reports fiscal year 2018 revenue and strong operating income growth; proposes dividend increase

Garmin Ltd. (Nasdaq: GRMN – News) today announced results for the fourth quarter and fiscal year ended December 29, 2018.

Highlights for the fourth quarter 2018 include:

• Total revenue of $932 million, a 4% increase, with aviation, marine, outdoor and fitness collectively increasing 13% over the prior year quarter
• Gross margin improved to 58.9% compared to 56.1% in the prior year quarter
• Operating margin improved to 23.9% compared to 20.4% in the prior year quarter
• Operating income of $223 million, representing 21% growth over the prior year
• GAAP EPS was $1.00 and pro forma EPS⁽¹⁾ was $1.02 for fourth quarter 2018, representing growth of 26% over the prior year
• Recently signed an agreement to acquire Tacx, a leading provider of indoor bike trainers
• Launched our first marine chartplotters with a combined Garmin and Navionics® chart database, offering industry leading breadth and depth of coverage

Highlights for the fiscal year 2018 include:

• Total revenue of $3,347 million, a 7% increase, with aviation, marine, outdoor and fitness collectively increasing 16% over the prior year
• Gross margin improved to 59.1% compared to 57.6% in the prior year
• Operating margin improved to 23.3% compared to 21.9% in the prior year
• Operating income of $778 million, representing 14% growth over the prior year
• GAAP EPS was $3.66 and pro forma EPS⁽¹⁾ was $3.69, representing 22% growth over the prior year
• Launched new categories of innovative wearables including Instinct™, a GPS smartwatch that expands the market for adventure watches, and Descent™, a dive computer in a watch style design for recreational, technical and free divers
• Expanded our portfolio of music compatible devices and integrated seven music providers into our Connect IQ™ app store including Spotify, Deezer and KKBOX
• Shipped nearly 15 million units and over 205 million since inception, including over one million certified aviation products.
• Completed the strategic acquisitions of FltPlan, a leading electronic flight planning and service provider, and Trigentic, a privately-held worldwide provider of marine electronic digital switching
• Opened our new aviation manufacturing facility in Olathe, Kansas, more than doubling our North American manufacturing capacity

(in thousands,			13-Weeks Ended											52-Weeks Ended
except per share data)			December 29,				December 30,				Yr over Yr			December 29,				December 30,				Yr over Yr
				2018				2017			Change				2018				2017			Change
Net sales			$	932,108			$	897,319			4	%		$	3,347,444			$	3,121,560			7	%
Aviation				158,314				129,800			22	%			603,459				501,359			20	%
Marine				94,652				83,699			13	%			441,560				374,001			18	%
Outdoor				254,568				203,278			25	%			809,883				698,867			16	%
Fitness				277,014				276,195			0	%			858,329				762,194			13	%
Auto				147,560				204,347			-28	%			634,213				785,139			-19	%
Gross margin %				58.9	%			56.1	%						59.1	%			57.6	%
Operating income %				23.9	%			20.4	%						23.3	%			21.9	%
GAAP diluted EPS			$	1.00			$	0.75			33	%		$	3.66			$	3.76			-3	%
Pro forma diluted EPS (1)			$	1.02			$	0.81			26	%		$	3.69			$	3.02			22	%

(1) See attached Non-GAAP Financial Information for discussion and reconciliation of non-GAAP financial measures, including pro forma diluted EPS

Executive Overview from Cliff Pemble, President and Chief Executive Officer:

“2018 was another remarkable year of revenue and operating income growth driven by strong performance in our aviation, marine, outdoor and fitness segments,” said Cliff Pemble, president and chief executive officer of Garmin Ltd. “Entering 2019, we see many opportunities ahead and believe that we are well positioned to seize these opportunities with a strong lineup of products across all of our segments.”

Aviation:

Revenue from the aviation segment grew 22% in the quarter with contributions from both the aftermarket and OEM categories. Gross and operating margins were 73% and 33%, respectively, resulting in 27% operating income growth. Aftermarket systems and ADS-B solutions contributed to our positive results as we move toward the ADS-B mandate deadline. We were honored to receive the supplier of the year award from Airbus Helicopters, and recently ranked #1 in avionics support for the 15^th consecutive year by both Professional Pilot Magazine and Aviation International News.

Marine:

Revenue from the marine segment grew 13% in the quarter driven by our new lineup of chartplotters, advanced sonars, and cartography offerings that combine the best of both Garmin and Navionics content. Gross and operating margins improved to 58% and 9%, respectively. We recently began shipping the 2019 lineup of marine electronics including the GPSMAP® 8600 series, our flagship product line with combined Garmin and Navionics chart content.

Outdoor:

Revenue from the outdoor segment grew 25% in the quarter with significant contributions from adventure watches. Gross and operating margins improved to 67% and 38%, respectively, resulting in 31% operating income growth. During the quarter, we launched Instinct, our newest line of adventure watch, and the GPSMAP 66 series of outdoor handhelds.

Fitness:

Revenue from the fitness segment was flat in the quarter compared to a strong prior year quarter. Gross and operating margins increased to 52% and 21%, resulting in 2% operating income growth. We recently introduced the vívoactive® 3 Music with 4G LTE, bringing connected safety features to the wrist. The pending acquisition of Tacx is an exciting opportunity to expand into the year-round indoor cycling and training market.

Auto:

The auto segment recorded revenue decline of 28% in the quarter, primarily due to the ongoing PND market contraction and lower year-over-year OEM sales. Gross margin improved to 43% and operating margin declined to 5%. At the recent Consumer Electronics Show, we announced our new line of Drive™ navigators with simplified, road trip-ready features and our updated OEM scalable infotainment platform.

Additional Financial Information:

Total operating expenses in the quarter were $326 million, a 2% increase from the prior year. Research and development increased 10%, primarily due to engineering personnel costs. Selling, general and administrative expenses decreased 2%, due primarily to reduced litigation related costs. Advertising decreased 6%, primarily due to lower media spend as we strategically focused our promotions.

The effective tax rate in the fourth quarter of 2018 was 18.0% compared to the pro forma effective tax rate of 20.5% in the prior year quarter. The decrease in the current quarter effective tax rate is primarily due to the benefits from U.S. tax reform.

In the fourth quarter of 2018, we generated approximately $185 million of free cash flow (see attached table for reconciliation of this non-GAAP measure). We ended the quarter with cash and marketable securities of approximately $2.7 billion.

2019 Guidance ⁽²⁾ :

We currently expect 2019 revenue of approximately $3.5 billion as growth in fitness, aviation, outdoor and marine is partially offset by declines in the auto segment. We currently expect our full year EPS will be approximately $3.70 based upon improved gross margin of approximately 59.5%, operating margin of approximately 22.7% and a full year effective tax rate of approximately 16.5%.

										Revenue
										Growth
					2019 Guidance			Segment		Estimates
			Revenue		~$3.5B			Fitness(3)		~13%
			Gross Margin		~59.5%			Aviation		~10%
			Operating Margin		~22.7%			Outdoor		~10%
			Tax Rate		~16.5%			Marine		~10%
			EPS		~$3.70			Auto		~(18%)

			(2) See attached discussion on Forward-looking Financial Measures
			(3) Fitness revenue growth estimate assumes the acquisition of Tacx will close within the second quarter of 2019

Dividend Recommendation:

The board of directors intends to recommend to the shareholders for approval at the annual meeting to be held on June 7, 2019, a cash dividend in the amount of $2.28 per share (subject to possible adjustment based on the total amount of the dividend in Swiss Francs as approved at the annual meeting), payable in four equal installments on dates to be determined by the Board. The Board currently anticipates the scheduling of the dividend in four installments as follows:

					Dividend Date			Record Date			$s per share
					June 28, 2019			June 17, 2019			$0.57
					September 30, 2019			September 16, 2019			$0.57
					December 31, 2019			December 16, 2019			$0.57
					March 31, 2020			March 16, 2020			$0.57

In addition, the board of directors has established March 29, 2019 as the payment date and March 15, 2019 as the record date for the final dividend installment of $0.53 per share, per the prior approval at the 2018 annual shareholders’ meeting. The first, second and third payments of $0.53 per share were made on June 29, 2018, September 28, 2018, and December 31, 2018, respectively.

Revenue Standard Adoption

We adopted the new revenue standard in the first quarter of 2018. The prior periods presented have been restated to reflect adoption of this new standard.

Webcast Information/Forward-Looking Statements:

The information for Garmin Ltd.’s earnings call is as follows:

			When:			Wednesday, February 20, 2019 at 10:30 a.m. Eastern
			Where:			http://www.garmin.com/en-US/company/investors/events/
			How:			Simply log on to the web at the address above or call to listen in at 855-757-3897

An archive of the live webcast will be available until February 27, 2020 on the Garmin website at www.garmin.com. To access the replay, click on the Investor Relations link and click over to the Events Calendar page.

This release includes projections and other forward-looking statements regarding Garmin Ltd. and its business that are commonly identified by words such as “would,” “may,” “expects,” “estimates,” “plans,” “intends,” “projects,” and other words or phrases with similar meanings. Any statements regarding the Company’s GAAP and pro forma estimated earnings, EPS, and effective tax rate, and the Company’s expected segment revenue growth rates, consolidated revenue, gross margins, operating margins, potential future acquisitions, currency movements, expenses, pricing, new products to be introduced in 2019, statements relating to possible future dividends and the Company’s plans and objectives are forward-looking statements. The forward-looking events and circumstances discussed in this release may not occur and actual results could differ materially as a result of risk factors and uncertainties affecting Garmin, including, but not limited to, the risk factors that are described in the Annual Report on Form 10-K for the year ended December 29, 2018 filed by Garmin with the Securities and Exchange Commission (Commission file number 0-31983). A copy of Garmin’s 2018 Form 10-K can be downloaded from https://www.garmin.com/en-US/company/investors/sec/form-10-K/ .

Non-GAAP Financial Measures

This release and the attachments contain non-GAAP financial measures. A reconciliation to the nearest GAAP measure and a discussion of the Company’s use of these measures are included in the attachments.

Garmin, the Garmin logo, the Garmin delta, Navionics, GPSMAP and vívoactive, are trademarks of Garmin Ltd. or its subsidiaries and are registered in one or more countries, including the U.S.; Descent, Drive and Instinct are trademarks of Garmin Ltd. or its subsidiaries. All other brands, product names, company names, trademarks and service marks are the properties of their respective owners. All rights reserved

Garmin Ltd. And Subsidiaries
Condensed Consolidated Statements of Income (Unaudited)
(In thousands, except per share information)
			13-Weeks Ended								52-Weeks Ended
			December 29,				December 30,				December 29,				December 30,
				2018				2017				2018				2017
Net sales			$	932,108			$	897,319			$	3,347,444			$	3,121,560
Cost of goods sold				382,942				393,837				1,367,725				1,323,619
Gross profit				549,166				503,482				1,979,719				1,797,941
Advertising expense				55,394				58,711				155,394				164,693
Selling, general and administrative expense				125,942				128,879				478,177				437,977
Research and development expense				145,157				132,552				567,805				511,634
Total operating expense				326,493				320,142				1,201,376				1,114,304
Operating income				222,673				183,340				778,343				683,637
Other income (expense):
Interest income				14,837				9,994				47,147				36,925
Foreign currency losses				(4,211	)			(8,772	)			(7,616	)			(22,579	)
Other (expense) income				(1,426	)			(107	)			5,373				(912	)
Total other income (expense)				9,200				1,115				44,904				13,434
Income before income taxes				231,873				184,455				823,247				697,071
Income tax provision (benefit)				41,723				41,905				129,167				(11,936	)
Net income			$	190,150			$	142,550			$	694,080			$	709,007
Net income per share:
Basic			$	1.01			$	0.76			$	3.68			$	3.77
Diluted			$	1.00			$	0.75			$	3.66			$	3.76
Weighted average common shares outstanding:
Basic				188,878				187,607				188,635				187,828
Diluted				190,177				188,915				189,734				188,732

Garmin Ltd. And Subsidiaries
Condensed Consolidated Balance Sheets (Unaudited)
(In thousands, except per share information)
			December 29,					December 30,
				2018					2017
Assets
Current assets:
Cash and cash equivalents			$	1,201,732				$	891,488
Marketable securities				182,989					161,687
Accounts receivable, net				569,833					590,882
Inventories				561,840					517,644
Deferred costs				28,462					30,525
Prepaid expenses and other current assets				120,512					153,912
Total current assets				2,665,368					2,346,138
Property and equipment, net				663,527					595,684
Restricted cash				73					271
Marketable securities				1,330,123					1,260,033
Deferred income taxes				176,959					195,981
Noncurrent deferred costs				29,473					33,029
Intangible assets, net				417,080					409,801
Other assets				100,255					107,352
Total assets			$	5,382,858				$	4,948,289
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable			$	204,985				$	169,640
Salaries and benefits payable				113,087					102,802
Accrued warranty costs				38,276					36,827
Accrued sales program costs				90,388					93,250
Deferred revenue				96,372					103,140
Accrued royalty costs				24,646					32,204
Accrued advertising expense				31,657					30,987
Other accrued expenses				69,777					93,652
Income taxes payable				51,642					33,638
Dividend payable				200,483					95,975
Total current liabilities				921,313					792,115
Deferred income taxes				92,944					76,612
Noncurrent income taxes				127,211					138,295
Noncurrent deferred revenue				76,566					87,060
Other liabilities				1,850					1,788
Stockholders’ equity:
Shares, CHF 0.10 par value, 198,077 shares authorized and issued; 189,461 shares outstanding at December 29, 2018 and 188,189 shares outstanding at December 30, 2017				17,979					17,979
Additional paid-in capital				1,823,638					1,828,386
Treasury stock				(397,692	)				(468,818	)
Retained earnings				2,710,619					2,418,444
Accumulated other comprehensive income				8,430					56,428
Total stockholders’ equity				4,162,974					3,852,419
Total liabilities and stockholders’ equity			$	5,382,858				$	4,948,289

Garmin Ltd. And Subsidiaries
Condensed Consolidated Statements of Cash Flows (Unaudited)
(In thousands)
			52-Weeks Ended
			December 29,					December 30,
				2018					2017
Operating activities:
Net income			$	694,080				$	709,007
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation				64,798					59,895
Amortization				31,396					26,357
Gain on sale or disposal of property and equipment				(479	)				(230	)
Provision for doubtful accounts				2,123					1,021
Provision for obsolete and slow moving inventories				24,579					31,071
Unrealized foreign currency loss				13,790					21,681
Deferred income taxes				38,978					(90,000	)
Stock compensation expense				56,391					44,735
Realized losses on marketable securities				827					991
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable				5,167					(40,088	)
Inventories				(82,316	)				(38,575	)
Other current and non-current assets				7,358					(21,608	)
Accounts payable				40,628					(17,240	)
Other current and non-current liabilities				(1,323	)				5,627
Deferred revenue				(17,208	)				(20,754	)
Deferred costs				5,611					2,395
Income taxes payable				35,120					(13,443	)
Net cash provided by operating activities				919,520					660,842
Investing activities:
Purchases of property and equipment				(155,755	)				(139,696	)
Proceeds from sale of property and equipment				1,600					361
Purchase of intangible assets				(4,600	)				(12,232	)
Purchase of marketable securities				(403,181	)				(587,656	)
Redemption of marketable securities				283,603					635,311
Acquisitions, net of cash acquired				(29,170	)				(90,471	)
Net cash used in investing activities				(307,503	)				(194,383	)
Financing activities:
Dividends				(296,148	)				(382,976	)
Proceeds from issuance of treasury stock related to equity awards				26,642					21,860
Purchase of treasury stock related to equity awards				(16,655	)				(12,773	)
Purchase of treasury stock under share repurchase plan				–					(74,523	)
Net cash used in financing activities				(286,161	)				(448,412	)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash				(15,810	)				26,716
Net increase in cash, cash equivalents, and restricted cash				310,046					44,763
Cash, cash equivalents, and restricted cash at beginning of period				891,759					846,996
Cash, cash equivalents, and restricted cash at end of period			$	1,201,805				$	891,759

Garmin Ltd. And Subsidiaries
Net Sales, Gross Profit and Operating Income by Segment (Unaudited)
(in thousands)
			Reportable Segments
			Outdoor			Fitness			Marine				Auto			Aviation			Total
13-Weeks Ended December 29, 2018
Net sales			$	254,568		$	277,014		$	94,652			$	147,560		$	158,314		$	932,108
Gross profit				169,425			145,291			54,779				63,405			116,266			549,166
Operating income				95,798			58,446			8,536				6,888			53,005			222,673
13-Weeks Ended December 30, 2017
Net sales			$	203,278		$	276,195		$	83,699			$	204,347		$	129,800		$	897,319
Gross profit				128,952			146,622			45,902				84,954			97,052			503,482
Operating income				73,322			57,315			(10,533	)			21,365			41,871			183,340
52-Weeks Ended December 29, 2018
Net sales			$	809,883		$	858,329		$	441,560			$	634,213		$	603,459		$	3,347,444
Gross profit				528,254			471,764			258,756				270,793			450,152			1,979,719
Operating income				290,510			181,745			63,344				37,998			204,746			778,343
52-Weeks Ended December 30, 2017
Net sales			$	698,867		$	762,194		$	374,001			$	785,139		$	501,359		$	3,121,560
Gross profit				448,410			422,636			212,592				342,698			371,605			1,797,941
Operating income				249,867			146,765			50,328				82,744			153,933			683,637

Garmin Ltd. And Subsidiaries
Net Sales by Geography (Unaudited)
(In thousands)
			13-Weeks Ended									52-Weeks Ended
			December 29,			December 30,			Yr over Yr			December 29,			December 30,			Yr over Yr
				2018			2017		Change				2018			2017		Change
Net sales			$	932,108		$	897,319		4	%		$	3,347,444		$	3,121,560		7	%
Americas				443,386			431,948		3	%			1,596,716			1,504,194		6	%
EMEA				342,853			340,850		1	%			1,204,969			1,172,538		3	%
APAC				145,869			124,521		17	%			545,759			444,828		23	%

EMEA – Europe, Middle East and Africa; APAC – Asia Pacific and Australian Continent

Non-GAAP Financial Information

To supplement our financial results presented in accordance with GAAP, this release includes the following measures defined by the Securities and Exchange Commission as non-GAAP financial measures: pro forma net income (earnings) per share, pro forma effective tax rate and free cash flow. These non-GAAP measures are not based on any comprehensive set of accounting rules or principles and should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and may be different from non-GAAP measures used by other companies, limiting the usefulness of the measures for comparison with other companies. Management believes providing investors with an operating view consistent with how it manages the Company provides enhanced transparency into the operating results of the Company, as described in more detail by category below.

The tables below provide reconciliations between the GAAP and non-GAAP measures.

Pro forma effective tax rate

The Company’s income tax expense is periodically impacted by discrete tax items that are not reflective of income tax expense incurred as a result of current period earnings. Therefore, management believes disclosure of the effective tax rate and income tax provision before the effect of certain discrete tax items are important measures to permit investors’ consistent comparison between periods. In 2018, there were no such discrete tax items identified.

Garmin Ltd. And Subsidiaries
Pro Forma Effective Tax Rate
(in thousands, except effective tax rate (ETR) information)
			13-Weeks Ended								52-Weeks Ended
			December 30,								December 30,
			2017								2017
				$			ETR (1)					$			ETR (1)
U.S. GAAP income tax provision (benefit)			$	41,905			22.7	%			$	(11,936	)		(1.7	%)
Pro forma discrete tax items:
Switzerland corporate tax election(2)				11,279								180,034
Tax expense from share-based award expirations(3)				(15,345	)							(22,620	)
Total pro forma discrete tax items				(4,066	)							157,414
Income tax provision (Pro Forma)			$	37,839			20.5	%			$	145,478			20.9	%

(1) Effective tax rate is calculated by taking the income tax provision divided by income before taxes, as presented on the face of the Condensed Consolidated Statements of Income.

(2) In first quarter 2017, a $169 million tax benefit was recognized resulting from the revaluation of certain Switzerland deferred tax assets. The revaluation is due to the Company’s election in February 2017 to align certain Switzerland corporate tax positions with international tax initiatives. In the fourth quarter 2017, an additional $11 million benefit was recognized as a result of this Switzerland election. These impacts during the transitional period following the election are not reflective of current income tax expense incurred and therefore affect period-to-period comparability.

(3) Following adoption in fiscal 2017 of Accounting Standards Update No. 2016-09, Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting (“ASU 2016-09”), the Company may periodically incur tax expense resulting from stock options and stock appreciation rights (SARs) expiring unexercised. New grants of stock options and SARs no longer comprise a significant component of the Company’s compensation arrangements. As the tax expense from expired awards is not related to current period earnings or compensation activities, it has been identified as a pro forma adjustment.

The net release of uncertain tax position reserves, amounting to approximately $31.0 million and $17.9 million for the 52-weeks ended December 29, 2018 and December 30, 2017, respectively, have not been included as pro forma adjustments in the above presentation of pro forma income tax provision as such items tend to be more recurring in nature.

Pro forma net income (earnings) per share

Management believes that net income (earnings) per share before the impact of foreign currency gains or losses and certain discrete income tax items, as discussed above, is an important measure in order to permit a consistent comparison of the Company’s performance between periods.

Garmin Ltd. And Subsidiaries
Pro Forma Net Income (Earnings) Per Share
(in thousands, except per share information)
			13-Weeks Ended									52-Weeks Ended
			December 29,				December 30,					December 29,				December 30,
				2018				2017					2018				2017
Net income (GAAP)			$	190,150			$	142,550				$	694,080			$	709,007
Foreign currency gains / losses(1)				4,211				8,772					7,616				22,579
Tax effect of foreign currency gains / losses(2)				(758	)			(1,799	)				(1,195	)			(4,712	)
Pro forma discrete tax items(3)				–				4,066					–				(157,414	)
Net income (Pro Forma)			$	193,603			$	153,589				$	700,501			$	569,460
Net income per share (GAAP):
Basic			$	1.01			$	0.76				$	3.68			$	3.77
Diluted			$	1.00			$	0.75				$	3.66			$	3.76
Net income per share (Pro Forma):
Basic			$	1.03			$	0.82				$	3.71			$	3.03
Diluted			$	1.02			$	0.81				$	3.69			$	3.02
Weighted average common shares outstanding:
Basic				188,878				187,607					188,635				187,828
Diluted				190,177				188,915					189,734				188,732

(1) The majority of the Company’s consolidated foreign currency gains and losses are driven by movements in the Taiwan Dollar, Euro, and British Pound Sterling in relation to the U.S. Dollar and the related exchange rate impact on the significant cash, receivables, and payables held in a currency other than the functional currency at one of the Company’s subsidiaries. However, there is minimal cash impact from such foreign currency gains and losses.

(2) The tax effect of foreign currency gains and losses was calculated using the effective tax rate of 18.0% and 15.7% for the quarter and year-to-date ended December 29, 2018, respectively, and a pro forma effective tax rate of 20.5% and 20.9% for the quarter and year-to-date ended December 30, 2017, respectively.

(3) The discrete tax items are discussed in the pro forma effective tax rate section above.

Free cash flow

Management believes that free cash flow is an important financial measure because it represents the amount of cash provided by operations that is available for investing and defines it as operating cash flows less capital expenditures for property and equipment. Management believes that excluding purchases of property and equipment provides a better understanding of the underlying trends in the Company’s operating performance and allows more accurate comparisons of the Company’s operating results to historical performance. This metric may also be useful to investors, but should not be considered in isolation as it is not a measure of cash flow available for discretionary expenditures. The most comparable GAAP measure is net cash provided by operating activities.

Garmin Ltd. And Subsidiaries
Free Cash Flow
(in thousands)
			13-Weeks Ended					52-Weeks Ended
			December 29,		December 30,			December 29,		December 30,
			2018		2017			2018		2017
Net cash provided by operating activities			$ 217,737		$ 198,265			$ 919,520		$ 660,842
Less: purchases of property and equipment			(32,909)		(54,484)			(155,755)		(139,696)
Free Cash Flow			$ 184,828		$ 143,781			$ 763,765		$ 521,146

Forward-looking Financial Measures

The forward-looking financial measures in our 2019 guidance provided above do not consider the potential effect of certain discrete tax items, foreign currency exchange gains and losses, and any other impacts that may be identified as pro forma adjustments in calculating the non-GAAP measures described above. At this time management is unable to determine whether or not significant discrete tax items will occur in fiscal 2019, reasonably estimate such foreign currency gains and losses, or anticipate the impact of any other events that may be considered in the calculation of non-GAAP financial measures.