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Trimble Reports Third Quarter 2006 Revenue Growth of 25 Percent

Trimble (Nasdaq: TRMB) today announced results for its third quarter 2006, ended September 29, 2006. Revenue for the third quarter of 2006 was $234.9 million, up 25 percent from revenue of $188.5 million in the third quarter of 2005.

Operating income for the third quarter of 2006 was $36.3 million, up 10 percent from the third quarter of 2005. For year-over-year comparisons it should be noted that third quarter 2006 operating income reflects a $3.0 million impact from stock-based compensation expense resulting from the adoption of FAS 123R. Additionally, the net impact of transactions with the Caterpillar Trimble Control Technologies (CTCT) joint venture, which were included in non-operating results in 2005, reduced operating results by $4.7 million in the quarter. In addition, amortization of purchased intangibles and purchased in-process research and development expense increased by $2.1 million versus the third quarter of 2005 due to acquisitions. Adjusting for the above factors, operating income in the third quarter of 2006 was up 38 percent compared to the third quarter of 2005.

Net income for the third quarter of 2006 was $25.3 million, up 25 percent when compared to net income of $20.2 million in the third quarter of 2005. Earnings per share for the third quarter of 2006 were $0.43, up approximately 23 percent compared to earnings per share of $0.35 in the third quarter of 2005. Earnings per share in the third quarter of 2006 were negatively impacted by approximately $0.03 due to the adoption of FAS 123R and by approximately $0.03 due to higher amortization of intangibles.

Adjusting for the impact of FAS 123R and acquisition related expenses, non-GAAP net income for the third quarter of 2006 was $29.2 million, up 39 percent compared to non-GAAP net income of $21.0 million in the third quarter of fiscal 2005. Non-GAAP earnings per share for the third quarter of 2006 were $0.50, up approximately 36 percent from non-GAAP earnings per share of $0.37 in the third quarter of 2005. GAAP and non-GAAP earnings per share for the third quarter of 2006 were calculated on a diluted basis using approximately 58.5 million shares.

"Our continued success reflects the combination of a robust strategy combined with effective execution. All segments within Trimble contributed to the third quarter. In particular, the Mobile Solutions segment continues to demonstrate rapid development with accompanying improvements in financial performance," said Steven W. Berglund, Trimble's president and chief executive officer. "We believe Trimble should continue to exhibit solid performance in the fourth quarter of 2006 and into 2007."

Trimble Results by Business Segment

For year-over-year comparisons it should be noted that third quarter 2005 results did not include stock-based compensation expense because FAS 123R was not adopted until the first quarter of 2006.

Engineering and Construction

Revenue for Engineering and Construction (E&C) was $162.4 million for the third quarter of 2006, up approximately 21 percent compared to revenue of $134.2 million in the third quarter of 2005.

Operating margins in E&C were 24 percent in the third quarter of 2006, compared to 26 percent in the third quarter of 2005. Excluding the impact of FAS 123R adoption and the CTCT joint venture transactions discussed above, E&C operating margins were 27 percent.

Growth in E&C was driven by continued strength in end markets and strong sales across the E&C product line.

Field Solutions

Field Solutions (TFS) revenue was $29.2 million in the third quarter of 2006, up 18 percent compared to $24.9 million in revenue in the third quarter of 2005. Growth was driven both by increased agricultural product sales and GIS product sales.

TFS operating margins for the third quarter of 2006 were 19 percent, compared to 16 percent in the third quarter of 2005 due to strong operating leverage.

Mobile Solutions

Third quarter 2006 revenue for Mobile Solutions (TMS), was $16.4 million, up 128 percent from revenue of $7.2 million in the third quarter of 2005. Organic revenue growth was strong, while revenue from acquisitions began to contribute meaningfully to results.

TMS operating margins were 7 percent for the third quarter of 2006, compared to a 10 percent loss in the third quarter of 2005. Margin expansion came from increased operating leverage driven principally by higher subscription revenue.

Advanced Devices

Advanced Devices revenue was $26.8 million, up 21 percent from revenue of $22.2 million in the third quarter of 2005, due primarily to increased sales of embedded devices and Applanix products, and licensing revenue from Nokia.

Advanced Devices operating margins were 15 percent, compared to 13 percent in the third quarter of 2005.

Non-GAAP vs. GAAP Financials

The Company provides non-GAAP financial measures including "non-GAAP net income," "non-GAAP operating income," and "non-GAAP earnings per share" to supplement its consolidated financial statements presented in accordance with GAAP. These non-GAAP financial measures are intended to supplement the user's overall understanding of the Company's current financial performance and its prospects for the future. In many cases, non-GAAP financial measures are used by analysts and investors to evaluate the Company.

The Company excludes the amortization of purchased intangibles, in-process research and development, restructuring charges, and the impact of stock-based compensation in computing non-GAAP measures because the chief executive officer excludes these items when budgeting and evaluating the business. These non-GAAP financial measures are not intended to supersede or replace the Company's GAAP results. Please see the supplemental financial statements, attached to this press release, for a reconciliation of GAAP to non-GAAP results.

Forward Looking Guidance

In the fourth quarter of 2006 the Company expects revenue to grow 18 to 20 percent compared to the fourth quarter of 2005, with revenue between $220 million and $225 million. At a 36 percent tax rate, with approximately 59.0 million shares outstanding, the Company expects fourth quarter 2006 GAAP earnings per share between $0.31 and $0.34.

The above GAAP guidance includes stock-based compensation due to the adoption of FAS 123R. On a post-tax basis, the Company expects stock-based compensation for the fourth quarter of 2006 to be approximately $0.03 per share.

The Company expects non-GAAP earnings per share between $0.40 and $0.43, compared to actual non-GAAP earnings per share of $0.29 in the fourth quarter of 2005. Non-GAAP guidance for the fourth quarter of 2006 uses a 36 percent tax-rate and excludes the amortization of intangibles of $5.6 million in the quarter, as well as the anticipated impact of stock-based compensation expense of $2.7 million.

Investor Conference Call / Webcast Details

The Company will hold a conference call on Oct. 24, 2006 at 1:30 p.m. PDT to review its third quarter 2006 results. It will be broadcast live on the Web at http://www.trimble.com/investors.shtml. A replay of the call will be available for thirty days beginning at 8:00 p.m. PDT on Oct. 24, 2006. The replay number is (800) 642-1687 (U.S.), or (706) 645-9291 (international), and the pass code is 7257038.

About Trimble

Trimble is a leading innovator of Global Positioning System (GPS) technology. In addition to providing advanced GPS components, Trimble augments GPS with other positioning technologies as well as wireless communications and software to create complete customer solutions. Trimble's worldwide presence and unique capabilities position the Company for growth in emerging applications including surveying, agriculture, machine guidance, asset and fleet management, wireless platforms, and telecommunications infrastructure. Founded in 1978 and headquartered in Sunnyvale, California, Trimble has more than 2,400 employees in more than 18 countries worldwide.

Certain statements made in this press release are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and are made pursuant to the safe harbor provisions of the Securities Litigation Reform Act of 1995. These statements include the revenue, effective tax rate, stock-based compensation, amortization of purchased intangibles and earnings per share estimates for the fourth fiscal quarter of 2006 and the Company's belief that it will continue to exhibit solid performance in the fourth quarter and through 2007. These forward- looking statements are subject to change, and actual results may materially differ from those set forth in this press release due to certain risks and uncertainties. For example, strong demand for the Company's products may not continue because of a decline in the overall health of the economy and international markets, which may result in reduced capital spending. Fuel and other operating costs could remain high or increase, which could weaken sales into the agricultural market. In addition, the Company's results may be adversely affected if the growth rates and profitability expectations for each of its four segments are not achieved, or its joint ventures and recent acquisitions do not achieve anticipated results, or if the Company is unable to market, manufacture and ship new products. Any failure to achieve predicted results could negatively impact the Company's revenues, gross margin and other financial results. Whether the Company achieves its guidance for the fourth fiscal quarter of 2006 will also depend on a number of other factors, including the risks detailed from time to time in reports filed with the SEC, including its quarterly reports on Form 10-Q and its annual report on Form 10- K. Undue reliance should not be placed on any forward-looking statement, contained herein. These statements reflect the Company's position as of the date of this release. The Company expressly disclaims any undertaking to release publicly any updates or revisions to any statements to reflect any change in the Company's expectations or any change of events, conditions, or circumstances on which any such statement is based.

FTRMB

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(Unaudited)

Three Months Ended Nine Months Ended

Sep-29, Sep-30, Sep-29, Sep-30,

2006 2005 2006 2005

Revenue $234,851 $188,484 $706,030 $588,092

Cost of sales 118,660 91,192 360,721 290,586

Gross margin 116,191 97,292 345,309 297,506

Gross margin (%) 49.5% 51.6% 48.9% 50.6%

Operating expenses

Research and development 25,180 20,639 77,234 63,332

Sales and marketing 34,902 29,313 103,356 88,388

General and administrative 17,981 13,448 50,016 38,204

Restructuring charges - - - 278

In-process research and

development 50 - 1,000 -

Amortization of purchased

intangible assets 1,747 865 5,639 5,340

Total operating expenses 79,860 64,265 237,245 195,542

Operating income 36,331 33,027 108,064 101,964

Non-operating income (expense),

net

Interest income (expense), net 1,315 (650) 2,347 (1,680)

Foreign currency transaction

gain, net 67 61 995 67

Income (Expense) for

affiliated operations, net 1,047 (1,976) 4,238 (7,514)

Other income, net 228 119 409 287

Total non-operating income

(expense), net 2,657 (2,446) 7,989 (8,840)

Income before taxes 38,988 30,581 116,053 93,124

Income tax provision 13,646 10,345 36,380 31,662

Net income $25,342 $20,236 $79,673 $61,462

Earnings per share:

Basic $0.46 $0.38 $1.45 $1.16

Diluted $0.43 $0.35 $1.38 $1.08

Shares used in calculating

earnings per share:

Basic 55,339 53,592 54,809 53,017

Diluted 58,493 57,492 57,927 56,997

NON-GAAP RECONCILIATION

(Dollars in thousands, except per share data)

(Unaudited)

Three Months Ended Nine Months Ended

Sep-29, Sep-30, Sep-29, Sep-30,

2006 2005 2006 2005

GAAP income before taxes $38,988 $30,581 $116,053 $93,124

Non-GAAP adjustments

Amortization of purchased

intangibles 2,875 *(a) 865 8,955 5,340

In-process research and

development 50 - 1,000 -

Amortization of acquisition-

related inventory step-up - - - 228

Restructuring charges - - - 278

Write off of Debt Issuance

Costs - 918 - 918

Stock-based compensation 2,948 *(b) - 9,437 -

Total Non-GAAP adjustments 5,873 1,783 19,392 6,764

Non-GAAP income before taxes 44,861 32,364 135,445 99,888

Income tax provision 15,701 11,328 47,406 34,961

Non-GAAP net income $29,160 $21,036 $88,039 $64,927

Diluted Non-GAAP earnings per

share $0.50 $0.37 $1.52 $1.14

Shares used in calculating diluted

non-GAAP earnings per share 58,493 57,492 57,927 56,997

*(a) Amortization of purchased intangibles, includes $1,747K recorded in

operating expense and $1,128K recorded in cost of sales for the three

months ended September 29, 2006 and $3,316K recorded in operating expense

and $5,639K recorded in cost of sales for the nine months ended September

29, 2006.

*(b) Stock compensation expense by Segment and GAAP category (in $000's):

Three Months Ended September 29, 2006

('000s)

E&C TFS TMS Advanced Corporate Total

Devices

Cost of sales $79 24 17 37 129 $285

Research &

development $278 71 55 172 43 $620

Sales & marketing $277 59 11 132 183 $663

General &

administrative $271 79 88 117 825 $1,380

Total $906 $233 $171 $458 $1,180 $2,948

Nine Months Ended September 29, 2006

('000s)

E&C TFS TMS Advanced Corporate Total

Devices

Cost of sales $285 73 43 69 410 $881

Research &

development $832 225 161 570 138 $1,926

Sales &

marketing $936 179 76 351 572 $2,115

General &

administrative $947 249 230 438 2,651 $4,515

Total $3,001 $727 $510 $1,428 $3,771 $9,437

EBITDA RECONCILIATION

(Dollars in thousands)

(Unaudited)

Three Months Ended Nine Months Ended

Sep-29, Sep-30, Sep-29, Sep-30,

2006 2005 2006 2005

GAAP net income $25,342 $20,236 $79,673 $61,462

Add back :

Interest (income)

expense, net (1,315) 650 (2,347) 1,680

Income tax provision 13,646 10,345 36,380 31,662

Depreciation expense 3,450 3,000 9,939 7,890

Amortization of

intangibles 2,937 911 9,082 5,459

EBITDA $44,060 $35,142 $132,727 $108,153

CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)

Sep-29, Dec-30,

2006 2005

Assets

Current assets:

Cash and cash equivalents 136,402 73,853

Accounts receivables, net 173,318 145,100

Other receivables 7,423 6,489

Inventories, net 114,875 107,851

Deferred income taxes 21,834 18,504

Other current assets 10,275 8,580

Total current assets 464,127 360,377

Property and equipment, net 47,389 42,664

Goodwill and other purchased

intangible assets, net 373,155 313,456

Deferred income taxes 3,809 3,580

Other assets 24,556 23,011

Total non-current assets 448,909 382,711

Total assets $913,036 $743,088

Liabilities and Shareholders' Equity

Current liabilities:

Current portion of long-term loan 290 216

Accounts payable 40,529 45,206

Accrued compensation and benefits 39,387 36,083

Accrued liabilities 22,398 16,189

Deferred revenue 24,302 12,588

Accrued warranty expenses 7,737 7,466

Deferred income taxes 5,462 4,087

Income taxes payable 21,977 24,922

Total current liabilities 162,082 146,757

Non-current portion of long-term loan 467 433

Deferred income taxes 14,031 5,602

Other non-current liabilities 27,532 19,041

Total liabilities 204,112 171,833

Shareholders' equity:

Common stock 428,730 384,196

Retained earnings 247,199 167,525

Accumulated other comprehensive

income 32,995 19,534

Total shareholders' equity 708,924 571,255

Total liabilities and

shareholders' equity $913,036 $743,088

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

Nine Months Ended

Sep-29, Sep-30,

2006 2005

Cash flow from operating activities:

Net Income $79,673 $61,462

Adjustments to reconcile net

income to net cash provided by

operating activities:

Depreciation expense 9,939 7,890

Amortization expense 9,082 5,459

Provision for doubtful

accounts 181 (663)

Amortization of debt

issuance cost 135 1,225

Deferred income taxes (355) 8,410

Stock-based compensation 9,437 -

In-process research and

development 1,000 -

Excess tax benefit for

stock-based compensation (8,088) -

Other 131 (670)

Add decrease (increase) in

assets:

Accounts receivables, net (19,829) (22,673)

Other receivables (623) 1,907

Inventories (3,442) (4,926)

Other current and non-

current assets (7,127) (4,450)

Add increase (decrease) in

liabilities:

Accounts payable (6,250) (4,374)

Accrued compensation and

benefits 2,188 825

Accrued liabilities 2,734 5,523

Deferred gain on joint

venture - 124

Deferred revenue 9,499 1,677

Income taxes payable 7,482 12,850

Net cash provided by operating

activities 85,767 69,596

Cash flows from investing

activities:

Acquisitions, net of cash

acquired (43,167) (21,589)

Acquisition of property and

equipment (13,966) (14,400)

Dividends received - 515

Cost of capitalized patents (16) (94)

Net cash used in investing

activities (57,149) (35,568)

Cash flow from financing activities:

Issuance of common stock 24,134 20,881

Excess tax benefit for stock-

based compensation 8,088 -

Proceeds from long-term debt

and revolving credit lines - 6,000

Payments on long-term debt and

revolving credit lines - (44,250)

Other (911) 390

Net cash provided (used) in

financing activities 31,311 (16,979)

Effect of exchange rate changes on

cash and cash equivalents 2,620 (1,628)

Net increase (decrease) in cash and

cash equivalents 62,549 15,421

Cash and cash equivalents -

beginning of period 73,853 71,872

Cash and cash equivalents - end of

period $136,402 $87,293

Q1'05 Q2'05 Q3'05 Q4'05 FY'05

Actual Actual Actual Actual Actual

Income Statement Metrics

Total Revenue $195,383 $204,225 $188,484 $186,821 $774,913

Engineering &

Construction 120,198 141,096 134,173 128,994 524,461

Trimble Field

Solutions 45,425 32,187 24,882 25,349 127,843

Advanced Devices 22,359 24,505 22,215 22,049 91,128

Trimble Mobile

Solutions 7,401 6,437 7,214 10,429 31,481

Gross Margin 50.1% 50.1% 51.6% 49.4% 50.3%

Total Segment Income $39,663 $47,916 $40,492 $32,589 $160,660

Engineering &

Construction 21,490 37,173 34,360 24,970 117,993

Trimble Field

Solutions 15,577 8,044 3,962 4,944 32,527

Advanced Devices 3,232 4,578 2,916 2,486 13,212

Trimble Mobile

Solutions (636) (1,879) (746) 189 (3,072)

Corporate and Other

Charges $(9,463) $(9,179) $(7,465) $(9,609) (35,716)

Non-operating income

(expense) $(12,761) $(14,950) $(12,791) $413 (40,089)

and income taxes

Net Income $17,439 $23,787 $20,236 $23,393 $84,855

GAAP operating margin% 15.5% 19.0% 17.5% 12.3% 16.1%

Non-GAAP operating

margin% 16.9% 20.0% 18.5% 13.7% 17.2%

GAAP EPS $0.31 $0.42 $0.35 $0.41 $1.49

Non-GAAP EPS $0.34 $0.44 $0.37 $0.29 $1.44

Balance Sheet Metrics

Cash & Cash Equivalents $50,193 $56,860 $87,293 $73,853

Accounts Receivables,

Net $154,540 $150,590 $146,792 $145,100

Inventories, Net $91,309 $89,853 $93,940 $107,851

Total Debt $28,836 $661 $659 $649

Short Term Debt 12,500 - - -

Long Term Debt 16,336 661 659 649

Equity $490,188 $513,817 $543,394 $571,255

Cashflow Metrics

Cash Flow from (used

in) Operations $(1,192) $37,762 $33,541 $22,769 $92,880

Working Capital $197,372 $208,410 $232,985 $213,620

Capital Expenditures $3,164 $4,570 $6,666 $9,036 $23,436

EBITDA $31,885 $41,126 $35,142 $35,822 $143,975

Amortization of

Intangibles 2,339 2,209 911 1,561 $7,020

Depreciation 2,512 2,378 3,000 2,781 $10,671

Financial Ratios

Days Sales Outstanding 62 60 60 66

Inventory Turns

(trailing 12 months) 4.3 4.1 4.0 3.9

Current ratio 2.5 2.7 2.8 2.5

Debt to Equity 0.1 - - -

Other

Headcount 2,231 2,308 2,347 2,462

(a) Impact of moving joint venture transactions from non-operating to

operating income - reduced gross margin by 2.4 points and operating

income by 2.0 points in Q3'06. In addition, operating margins were

impacted by 1.3 points due to stock-based compensation expense.

(For details, please refer to the Non-GAAP Reconciliation).

(b) Impact of moving joint venture transactions from non-operating to

operating income - reduced operating income by 2.0 points in Q3'06.

Q1'06 Q2'06 Q3'06

Actual Actual Actual

Income Statement Metrics

Total Revenue $225,854 $245,326 $234,851

Engineering & Construction 146,734 168,041 162,370

Trimble Field Solutions 43,043 36,320 29,236

Advanced Devices 23,470 26,114 26,819

Trimble Mobile Solutions 12,607 14,851 16,426

Gross Margin 47.6% 49.6% 49.5% (a)

Total Segment Income $42,833 $52,719 $49,209

Engineering & Construction 26,378 38,803 38,337

Trimble Field Solutions 13,909 11,299 5,634

Advanced Devices 2,323 2,243 4,113

Trimble Mobile Solutions 223 374 1,125

Corporate and Other Charges $(9,768) $(14,049) $(12,878)

Non-operating income (expense) $(7,237) $(10,167) $(10,989)

and income taxes

Net Income $25,828 $28,503 $25,342

GAAP operating margin% 14.6% 15.8% 15.5% (a)

Non-GAAP operating margin% 17.1% 19.0% 18.0% (b)

GAAP EPS $0.45 $0.49 $0.43

Non-GAAP EPS $0.52 $0.59 $0.50

Balance Sheet Metrics

Cash & Cash Equivalents $97,648 $107,726 $136,402

Accounts Receivables, Net $171,392 $171,942 $173,318

Inventories, Net $101,552 $113,925 $114,875

Total Debt $603 $890 $757

Short Term Debt 166 431 290

Long Term Debt 437 459 467

Equity $611,860 $664,739 $708,924

Cashflow Metrics

Cash Flow from (used in) Operations $18,298 $41,071 $26,398

Working Capital $249,302 $257,808 $302,045

Capital Expenditures $4,972 $5,971 $3,023

EBITDA $40,882 $47,748 $44,060

Amortization of Intangibles 2,380 3,766 2,937

Depreciation 3,104 3,386 3,450

Financial Ratios

Days Sales Outstanding 57 55 59

Inventory Turns (trailing 12

months) 4.0 4.0 4.0

Current ratio 2.6 2.5 2.9

Debt to Equity - - -

Other

Headcount 2,543 2,627 2,665

(a) Impact of moving joint venture transactions from non-operating to

operating income -- reduced gross margin by 2.4 points and operating

income by 2.0 points in Q3'06. In addition, operating margins were

impacted by 1.3 points due to stock-based compensation expense.

(For details, please refer to the Non-GAAP Reconciliation).

(b) Impact of moving joint venture transactions from non-operating to

operating income -- reduced operating income by 2.0 points in Q3'06.

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