GAAP TO NON-GAAP RECONCILIATION

(Dollars in thousands, except per share data)

(Unaudited)

Second Quarter of

First Two Quarters of

2013

2012

2013

2012

Dollar

% of

Dollar

% of

Dollar

% of

Dollar

% of

Amount

Revenue

Amount

Revenue

Amount

Revenue

Amount

Revenue

GROSS MARGIN:

GAAP gross margin:

$   302,401

52.5%

$   267,696

51.7%

$   589,315

52.0%

$   526,846

51.7%

Restructuring

( A )

766

0.1%

34

0.0%

821

0.1%

79

0.0%

Amortization of purchased intangible assets

( B )

19,855

3.4%

13,296

2.6%

39,536

3.5%

26,417

2.6%

Stock-based compensation

( C )

607

0.1%

458

0.1%

1,207

0.1%

978

0.1%

Amortization of acquisition-related inventory step-up

( D )

524

0.1%

122

0.0%

1,127

0.1%

130

0.0%

Non-GAAP gross margin: 

$   324,153

56.2%

$   281,606

54.4%

$   632,006

55.8%

$   554,450

54.4%

OPERATING EXPENSES:

GAAP operating expenses:

$   237,496

41.2%

$   208,775

40.3%

$   467,953

41.3%

$   408,077

40.0%

Restructuring

( A )

(2,966)

-0.5%

(1,112)

-0.2%

(4,571)

-0.4%

(1,593)

-0.2%

Amortization of purchased intangible assets

( B )

(19,908)

-3.5%

(15,782)

-3.0%

(39,559)

-3.5%

(31,458)

-3.1%

Stock-based compensation

( C )

(7,828)

-1.4%

(7,697)

-1.5%

(16,046)

-1.4%

(14,966)

-1.4%

Acquisition costs

( E )

(2,976)

-0.4%

(7,815)

-1.5%

(6,394)

-0.6%

(12,581)

-1.2%

Non-GAAP operating expenses:

$   203,818

35.4%

$   176,369

34.1%

$   401,383

35.4%

$   347,479

34.1%

OPERATING INCOME:

GAAP operating income:

$     64,905

11.3%

$     58,921

11.4%

$   121,362

10.7%

$   118,769

11.6%

Restructuring

( A )

3,732

0.6%

1,146

0.2%

5,392

0.5%

1,672

0.2%

Amortization of purchased intangible assets

( B )

39,763

6.9%

29,078

5.6%

79,095

7.0%

57,875

5.7%

Stock-based compensation

( C )

8,435

1.5%

8,155

1.6%

17,253

1.5%

15,944

1.6%

Amortization of acquisition-related inventory step-up

( D )

524

0.1%

122

0.0%

1,127

0.1%

130

0.0%

Acquisition costs

( E )

2,976

0.5%

7,815

1.5%

6,394

0.6%

12,581

1.2%

Non-GAAP operating income: 

$   120,335

20.9%

$   105,237

20.3%

$   230,623

20.4%

$   206,971

20.3%

NON-OPERATING INCOME, NET:

GAAP non-operating income, net:

$      3,786

$      4,370

$       1,698

$      4,849

Acquisition / divestiture gain

( E )

(459)

(557)

(860)

(113)

Foreign exchange loss associated with acquisitions

( F )

-

-

-

1,578

Non-GAAP non-operating income, net: 

$      3,327

$      3,813

$          838

$      6,314

GAAP and 

GAAP and 

GAAP and 

GAAP and 

Non-GAAP

Non-GAAP

Non-GAAP

Non-GAAP

Tax Rate %

( H )

Tax Rate %

( H )

Tax Rate %

( H )

Tax Rate %

( H )

INCOME TAX PROVISION:

GAAP income tax provision:

$     13,738

20%

$     10,126

16%

$     19,175

16%

$     20,381

16%

Non-GAAP items tax effected

( G )

10,994

7,321

16,337

14,785

Non-GAAP income tax provision: 

$     24,732

20%

$     17,447

16%

$     35,512

16%

$     35,166

16%

NET INCOME:  

GAAP net income attributable to Trimble Navigation Ltd.

$     54,581

$     53,692

$   104,389

$   104,510

Restructuring

( A )

3,732

1,146

5,392

1,672

Amortization of purchased intangible assets

( B )

39,763

29,078

79,095

57,875

Stock-based compensation

( C )

8,435

8,155

17,253

15,944

Amortization of acquisition-related inventory step-up

( D )

524

122

1,127

130

Acquisition / divestiture costs, net

( E )

2,517

7,258

5,534

12,468

Foreign exchange loss associated with acquisitions

( F )

-

-

-

1,578

Non-GAAP items tax affected

( G )

(10,994)

(7,321)

(16,337)

(14,785)

Non-GAAP net income attributable to Trimble Navigation Ltd.

$     98,558

$     92,130

$   196,453

$   179,392

DILUTED NET INCOME PER SHARE:

GAAP diluted net income per share attributable to Trimble Navigation Ltd.

$        0.21

$        0.21

$         0.40

$        0.41

Restructuring

( A )

0.01

-

0.02

0.01

Amortization of purchased intangible assets

( B )

0.15

0.11

0.30

0.23

Stock-based compensation

( C )

0.04

0.04

0.07

0.06

Amortization of acquisition-related inventory step-up

( D )

-

-

-

-

Acquisition / divestiture costs, net

( E )

0.01

0.03

0.02

0.05

Foreign exchange loss associated with acquisitions

( F )

-

-

-

0.01

Non-GAAP items tax affected

( G )

(0.04)

(0.03)

(0.06)

(0.07)

Non-GAAP diluted net income per share attributable to Trimble Navigation Ltd.

$        0.38

$        0.36

$         0.75

$        0.70

OPERATING LEVERAGE:

Increase in non-GAAP operating income

$     15,098

$     24,910

$     23,652

$     56,542

Increase in revenue

$     58,733

$   110,391

$   112,577

$   228,365

Operating leverage (increase in non-GAAP operating 

income as a % of increase in revenue)

25.7%

22.6%

21.0%

24.8%