Garmin Ltd · 10-K · For 12/28/02

Filed On 3/25/03, 5:09pm ET   ·   Accession Number 1121788-3-4   ·   SEC File 0-31983

Annual Report   —   Form 10-K
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 United States
Securities and Exchange Commission
Washington, D.C. 20549

 FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
 SECURITIES EXCHANGE ACT OF 1934
For the year ended December 28, 2002
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
 SECURITIES EXCHANGE ACT OF 1934
               For the transition period from ------ to ------
Commission file number 0-31983
----------------
 GARMIN LTD.
 (Exact name of Company as specified in its charter)

Cayman Islands                                98-0229227
      (State or other jurisdiction          (I.R.S. Employer identification no.)
of incorporation or organization)                                     
5th Floor, Harbour Place, P.O. Box 30464 SMB,                 N/A               
103 South Church Street                            (Zip Code)   
George Town, Grand Cayman, Cayman Islands                                       
(Address of principal executive offices)                                      

 Company's telephone number, including area code: (345) 946-5203

Securities registered pursuant to Section 12(b) of the Act: None                
Securities registered pursuant to Section 12(g) of the Act:                     

Common Shares, $0.01 Per Share Par Value
(Title of Class)

Indicate by check mark whether the Company (1) has filed all reports required to
be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of 1934 during
the  preceding  12 months  (or for such  shorter  period  that the  Company  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days. YES [x] NO [ ]                               

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best of Company's  knowledge,  in  definitive  proxy or  information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [x]                                                                  

Indicate  by check mark  whether  the  registrant  is an  accelerated  filer (as
defined in Rule 12b-2 of the Exchange Act). YES [x] NO [ ]                      

     Aggregate  market value of the voting and non-voting  common shares held by
non-affiliates  of the Company as of June 28, 2002, the last business day of the
Company's most recently  completed  second fiscal quarter,  based on the closing
price of the  Company's  common  shares on the Nasdaq Stock Market for that date
Common Shares, $.01 par value - $1,424,510,108
Number of shares outstanding of the Company's common shares as of March 7, 2003:
 Common Shares, $.01 par value - 107,959,367
Documents  incorporated  by  reference:                                         
Portions of the following  document are incorporated  herein by reference into  
Part III of the Form 10-K as indicated:                                         

Document                                           Part  of  Form  10-K  into   
--------                                           which Incorporated           
                                        ------------------
Company's  Definitive  Proxy Statement for              Part III                
the 2003 Annual Meeting of Shareholders which                                   
will be filed no later than 120 days after                                      
December 28, 2002                                                               

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 Garmin Ltd.

2002 Form 10-K Annual Report

 Table of Contents

    Cautionary Statement With Respect To Forward-Looking Comments..............1

Part I

Item 1.      Business..........................................................1
Item 2.      Properties.......................................................11
Item 3.      Legal Proceedings................................................11
Item 4.      Submission of Matters to a Vote of Security Holders..............11
             Executive Officers and Significant Employees of the Company......11

 Part II

Item 5.      Market for the Company's Common Shares and Related Shareholder     
             Matters..........................................................13
Item 6.      Selected Financial Data..........................................13
Item 7.      Management's Discussion and Analysis of Financial Condition        
             and Results of Operations........................................15
Item 7A.     Quantitative and Qualitative Disclosures About Market Risk.......36

Item 8.      Financial Statements and Supplementary Data......................38
Item 9.      Changes in and Disagreements with Accountants on Accounting        
             and Financial Disclosure.........................................61

Part III

Item 10.     Directors and Executive Officers of the Company..................62
Item 11.     Executive Compensation...........................................62
Item 12.     Security Ownership of Certain Beneficial Owners and Management     
             and Related Shareholder Matters..................................62
Item 13.     Certain Relationships and Related Transactions...................63
Item 14.     Controls and Procedures..........................................63

 Part IV

Item 15.     Exhibits, Financial Statement Schedules, and Reports               
             on Form 8-K......................................................64
             Signatures.......................................................68

GARMIN,  the GARMIN logo, the GARMIN globe design,  the GARMIN "swoosh"' design,
STREETPILOT,  ETREX, ETREX VISTA, ETREX VENTURE, ETREX CAMO, ETREX SUMMIT, EMAP,
TRACBACK,  DCG,  GPSMAP,  GPS III, GPS V,  GPSCOM,  TRACPAK,  G CHART,  PERSONAL
NAVIGATOR,  GUIDANCE  BY  GARMIN,  AUTOLOCATE,  BLUECHART,  NAVTALK,  MAPSOURCE,
METROGUIDE,   CITY  SELECT  and  SEE-THRU  are  included  among  the  registered
trademarks of Garmin, and ETREX LEGEND, ETREX MARINER,  RINO, IQUE, QUE and GEKO
are  trademarks of Garmin Ltd. or its  subsidiaries.  All other  trademarks  and
trade names  referred to in this Form 10-K are the property of their  respective
owners.                                                                         

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 CAUTIONARY STATEMENT WITH RESPECT TO FORWARD-LOOKING COMMENTS

     The  discussions  set forth in this  Annual  Report  on Form  10-K  contain
statements  concerning potential future events. Such forward-looking  statements
are based upon assumptions by the Company's  management,  as of the date of this
Annual Report,  including assumptions about risks and uncertainties faced by the
Company. In addition,  management may make forward-looking  statements orally or
in other  writings,  including,  but not limited to, in press  releases,  in the
annual  report to  shareholders  and in the  Company's  other  filings  with the
Securities and Exchange Commission.  Readers can identify these  forward-looking
statements  by their use of such  verbs as  expects,  anticipates,  believes  or
similar verbs or conjugations of such verbs.  Readers are cautioned not to place
undue reliance on these forward-looking statements, which speak only as of their
date. If any of management's assumptions prove incorrect or should unanticipated
circumstances  arise, the Company's actual results could materially  differ from
those anticipated by such forward-looking  statements.  The differences could be
caused by a number of  factors or  combination  of  factors  including,  but not
limited to, those factors  identified in Item 7,  "Management's  Discussion  and
Analysis of Financial  Condition and Results of  Operations",  of this Form 10-K
under the  heading  "Company-Specific  Trends and Risks".  Readers are  strongly
encouraged  to  consider  those  factors  when  evaluating  any  forward-looking
statements   concerning   the   Company.   The  Company   will  not  update  any
forward-looking  statements  in this Annual  Report to reflect  future events or
developments.                                                                   

Part I

Item 1.  Business                                                               

     This discussion of the business of Garmin Ltd.  ("Garmin" or the "Company")
should  be  read  in  conjunction  with,  and  is  qualified  by  reference  to,
"Management's  Discussion and Analysis of the Company's  Financial Condition and
Results of  Operations"  ("MD&A")  under Item 7 herein and the  information  set
forth in response to Item 101 of Regulation  S-K in such Item 7 is  incorporated
herein by reference in partial response to this Item 1. In addition, pursuant to
Rule 12b-23 under the Securities  Exchange Act of 1934, as amended,  the segment
and  geographic  information  included  in Item  8,  "Financial  Statements  and
Supplementary  Data",  Note 11 is  incorporated  herein by  reference in partial
response to this Item 1.                                                        

     The Company was  incorporated  in the Cayman  Islands on July 24, 2000 as a
holding  company  for  Garmin  Corporation,  a Taiwan  corporation,  in order to
facilitate a public offering of Garmin shares in the United States.  The Company
owns,  directly or  indirectly,  all of the  operating  companies  in the Garmin
group.                                                                          

     The Company's annual report on Form 10-K,  quarterly  reports on Form 10-Q,
current  reports on Form 8-K, and all  amendments  to those reports will be made
available free of charge through the Investor Relations section of the Company's
Internet website (http://www.garmin.com) as soon as reasonably practicable after
such material is electronically  filed with, or furnished to, the Securities and
Exchange Commission.                                                            

Recent Developments in the Company's Business                                   

Share Repurchase Program                                              

     On  September  24,  2001,  Garmin  announced  that its  Board of  Directors
approved a share repurchase  program  authorizing  Garmin to purchase up to five
million common shares of Garmin Ltd. as market and business  conditions warrant.
The share repurchase  authorization expired on December 31, 2002. As of December
31, 2002,  Garmin had purchased a total of 595,200 shares pursuant to this share
repurchase  authorization  at a total cost of $9.8 million.  All such  purchased
shares have been  cancelled  and now form part of the  authorized  but  unissued
capital of Garmin,  since  Cayman  Islands law does not permit a company to hold
its own shares.                                                                 

Management                                                            

     Gary L. Burrell  retired as Co-CEO of Garmin on August 24,  2002,  his 65th
birthday. Mr. Burrell remains Co-Chairman and a director of Garmin. Since August
24,  2002,  Dr.  Min H. Kao has  served  as the sole CEO and as  Co-Chairman  of
Garmin. Dr. Kao previously served as Co-CEO of Garmin.                          

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     In  consideration  of proposed  Nasdaq rule changes that would require that
Nasdaq-listed  companies  have a board  composed  of a majority  of  independent
directors, Mr. Ruey-Jeng Kao resigned as a director of Garmin on August 19, 2002
and the Board of Directors  voted to reduce the number of directors  from six to
five. The Company's  Board of Directors is now composed of Gary L. Burrell,  Dr.
Min H. Kao and three independent  directors,  Gene M. Betts, Donald H. Eller and
Thomas A. McDonnell.                                                            

Debt Retirement                                                       

     On May 1, 2002, Garmin's subsidiary, Garmin International, Inc. retired all
$9.3 million of its outstanding 1995 series tax-exempt Industrial Revenue Bonds.

Company Overview                                                                

     Garmin is a leading,  worldwide provider of navigation,  communications and
information  devices,  most of  which  are  enabled  by GPS  technology.  Garmin
designs,  develops,  manufactures  and markets  under the GARMIN brand a diverse
family of  hand-held,  portable and fixed mount  GPS-enabled  products and other
navigation, communications and information products for the general aviation and
consumer  markets.  Each of  Garmin's  GPS  products  utilizes  its  proprietary
integrated  circuit  and  receiver  designs to  collect,  calculate  and display
location, direction, speed and other information in forms optimized for specific
uses.                                                                           

Overview of the Global Positioning System                                       

     The Global Positioning System,  first made available by the U.S. government
for commercial use in 1983, is a worldwide  navigation  system which enables the
precise   determination  of  geographic  location  using  established  satellite
technology.  The system consists of a constellation of orbiting satellites.  The
satellites and their ground  control and monitoring  stations are maintained and
operated by the United States Department of Defense,  which maintains an ongoing
satellite  replenishment  program to ensure  continuous  global system coverage.
Access to the system is provided free of charge by the U.S. government.         

     Reception  of  GPS  signals  from  the  satellites  requires  line-of-sight
visibility between the satellites and the receiver.  GPS receivers  generally do
not work  indoors  and when a receiver is  outside,  buildings,  hills and dense
foliage can attenuate or block reception. GPS receivers can be very compact, and
it is not necessary to have a large dish antenna to receive GPS signals.        

     Prior to May 2000, the U.S.  Department of Defense  intentionally  degraded
the  accuracy  of  civilian  GPS  signals  in  a  process   known  as  Selective
Availability  ("SA") for national  security  purposes.  SA variably degraded GPS
position accuracy to a radius of 100 meters. On May 2, 2000, the U.S. Department
of Defense  discontinued  SA. With SA removed,  a GPS receiver can calculate its
position to an accuracy of 10 meters or less,  enhancing  the utility of GPS for
most applications.                                                              

     The  accuracy  and  utility of GPS can be  enhanced  even  further  through
augmentation  techniques  which compute any  remaining  errors in the signal and
broadcast these corrections to a GPS device. The Federal Aviation Administration
("FAA") is developing a Wide Area Augmentation System ("WAAS") comprising ground
reference stations and additional  satellites which will improve the accuracy of
GPS positioning available in the United States and portions of Canada and Mexico
to  approximately  3 meters.  WAAS is  intended to support the use of GPS as the
primary means of enroute,  terminal and approach  navigation for aviation in the
United  States.  The  increased  accuracy  offered by WAAS is  expected  also to
enhance the utility of WAAS-enabled GPS receivers for consumer applications. The
FAA has  stated  that it  expects  the WAAS  system  to have  initial  operating
capability by July 2003.                                                        

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Products                                                                        

     Garmin has  achieved a leading  market  position  and a record of growth in
revenues and profits by offering ergonomically  designed, user friendly products
with innovative  features and designs covering a broad range of applications and
price points.                                                                   

     Garmin's target markets currently  consist of the consumer  segment,  which
primarily  includes  marine,  recreational  and  automotive  products,  and  the
aviation segment, which consists of panel mount and portable products for use in
general aviation aircraft.                                                      

     While the marine, recreational,  automotive and aviation product lines will
continue to be the core of Garmin's business in the near-term,  GPS capabilities
are  becoming  increasingly  commercially  viable  in a wide  range of  consumer
products  and  services,  including  wireless  consumer  and mobile  information
devices (such as Family Radio Service and General  Mobile Radio Service  two-way
radios,  cellular phones and personal digital  assistants).  Garmin's goal is to
take  advantage  of its brand name and its  product  development  experience  to
expand its product line in these potentially high-growth GPS markets.           

     In October  2002,  Garmin  began  shipping  its  Rino(TM)  110 and Rino 120
products which are Family Radio Service and General Mobile Radio Service two-way
radios with integrated GPS capabilities.                                        

     In January  2003,  Garmin  announced  its iQue(TM)  3600  personal  digital
assistant   which   integrates   Palm  OS  based  personal   digital   assistant
functionality  with GPS  navigation  functionality.  The iQue3600 is expected to
begin shipping in mid-2003.                                                     

Consumer                                                                        

     Garmin  currently  offers a wide  range  of  consumer  products,  including
handheld GPS  receivers,  two-way  radios with  integrated  GPS  receivers,  our
StreetPilot(R)   portable   automotive   navigation   devices  and   fixed-mount
GPS/Sounder  products.  Garmin believes that its consumer products are known for
their value leadership,  high performance,  innovation and ergonomics.  Garmin's
iQue 3600 won the 2003  Consumer  Electronics  Association  Best of  Innovations
award in the mobile office category.                                            

     Garmin  also  offers  a broad  set of  accessories  for its  products.  For
instance,  Garmin's  MapSource(R)  CDs,  which can be loaded into  selected  GPS
products through a personal computer,  provide detailed mapping  information for
the United States and Canada,  Australia,  South Africa and a number of European
and Asian countries.  With this  information,  Garmin's  StreetPilot,  GPS V(R),
eTrex  Venture(R),  eTrex(R)  Legend,  eTrex Vista(R),  and eMap(R) products can
provide the customer with detailed information  concerning business listings and
points of interest.  A user can choose a business  listing  (e.g.,  restaurants,
hotels,  and shops) and the unit will display the location of the destination on
a map along with the user's location and the distance from the user's  location.
Some of Garmin's  products offer  automatic route  calculation and  turn-by-turn
route guidance. Garmin's BlueChart(R) CD's and data cards, which are compatible 
with selected GPS chartplotter and handheld products,  provide detailed nautical
chart data for boaters.                                                         

     The table  below  includes a sampling of some of the  products  that Garmin
currently offers to consumers.                                                  

Handheld and portable consumer products:                                        

Geko                                                                            
(2 models)                 Miniature size low-cost GPS receivers with colorful  
design and easy operation.

eMap                       Pocket-size GPS with built-in basic map showing      
                     highways and major streets for personal use and
                     business travel. MapSource compatibility allows
                  street level mapping, points of interest and
     address location functionality.

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eTrex                                                                           
(6 models)                 Ultra compact full feature handheld GPS design for   
                         outdoor enthusiasts.  All models are waterproof and
                         have rugged  designs.  The eTrex  Summit  and eTrex
                  Vista have electronic compass and barometric
                          altimeter functions.  eTrex  Venture has a worldwide
                           database of cities. eTrex Legend and eTrex Vista have
                          internal basemaps  of either North and South America
                          or Europe.  eTrex Camo features a camouflaged design
                         and a hunting and fishing almanac.  The eTrex class
                          of products  represented approximately 20 percent of
                         Garmin's total consolidated revenues in fiscal year
                         2002 and  fiscal  year  2001.  The  eTrex  class of
                        products represented less than 10 percent of total
                    consolidated revenues during fiscal year 2000.

StreetPilot III            Portable automotive navigation system with           
                         basemap and MapSource compatibility allowing street
                   level mapping, points of interest and address
                       location functionality. Features include "turn by
                        turn" automatic route guidance and voice prompting
          and a high resolution color display.

GPS 12                                                                          
(2 models)                 Rugged handhelds for serious outdoor enthusiasts.    
                          Capabilities and features available in different GPS
                     12 models include basic navigation and built-in
database of cities.       

GPS 72                     Rugged handheld for land or marine navigation.       
                       Features include 1 MB internal memory for loading
                       MapSource points of interest and high contrast 4-
level gray scale display. 

GPS 76                                                                          
(3 models)                 Handheld GPS with large display and a waterproof case
                       which floats in water.  Preloaded with U.S. tidal
                        data. GPSMAP 76 has internal basemap and MapSource
                         compatibility for street level mapping and detailed
                        marine charts.  GPSMAP 76S additionally features a
                     barometric altimeter and an electronic compass.

GPS V                      Portable GPS with "turn by turn" automatic route     
                        guidance, MapSource compatibility for street level
                   mapping and selectable vertical or horizontal
displays.                 

Marine fixed-mount units:                                                       

GPS126, 128 and 152        Low cost fixed-mount GPS units for boating with      
                          either a built-in antenna or an external antenna for
                          exposed  installations.  GPS 152 has  internal data-
                          base of U.S. cities and navigation  aids and has the
                        compatibility of uploading points of interest data
                       from a personal computer with MapSource CD-ROM's.

GPSMAP                                                                          
(10 models)                Marine GPS/plotter combinations for boating and      
                       fishing enthusiasts of different levels. Features
                        available on different models include a variety of
                        display sizes  (ranging in size from 3.8" to 10"),
                         high-contrast LCD  graphics, monochrome 16-color or
                          256-color displays and the capability  of  uploading
                     mapping and nautical chart data from a personal
                     computer with MapSource and BlueChart CD-ROM's.

Sounder products:                                                               

FishFinders                                                                     
(7 models)                 Fishfinders  feature DCG(R)and See-Thru(R)technology,
                           which aid fishermen in defining the ocean/lake bottom
                        and  spotting  fish in hidden or  obscured  areas.
                           Fishfinder Blue series  products  have dual frequency
                        transducers for optimal performance in deep water.

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GPSMAP/Sounder                                                                  
(4 models)                 "All-in-one"  product lines  with  GPS, chartplotter 
                        and sonar  functionality.  These  units  come with
                           different display sizes (ranging in size from 4.2" to
                          7.25") and the  capability of uploading  mapping and
                       nautical chart data.  Certain models feature dual
                         frequency transducers for optimal sonar performance
                           in deep water. GPSMAP 188C features a high resolution
color display.            

Consumer communications products:                                               

Rino                                                                            
(2 models)                 Handheld two-way Family Radio Service(FRS)and General
                       Mobile Radio Service (GMRS) radios that integrate
                           two-way  voice communications  with  GPS  navigation.
                          Features  include  patented  "peer-to-peer  position
                       reporting"  so you can transmit your  location to
                       another Rino radio.  The Rino 120 has an internal
                          basemap and MapSource compatibility for street-level
mapping.                  

NavTalk GSM                A handheld unit that combines a 900 MHz/1800 MHz     
                        GSM digital cellular telephone and a full-featured
                       GPS receiver with mapping display, "turn by turn"
                   automatic route guidance and voice prompting.
                        Features the ability to transmit location from one
                        unit to another unit and to location-based service
companies.                

VHF 720 & 725              Waterproof,  portable handheld marine two-way radios 
                       with either 3-watt or 5-watt power output provide
                           clear VHF communication capabilities for all types of
boaters.                  

Portable Digital Assistant products:                                            

iQue 3600                                                                       
(expected to be                                                                 
available in mid-2003)     Portable Digital Assistant(PDA)with integrated GPS   
                      and mapping. Features include Palm OS 5 platform
                          with all standard Palm applications, voice recorder,
                           flip-up integrated GPS antenna, 3.8" diagonal 320x480
                       pixel color display, automatic route calculation,
                          turn-by-turn voice route guidance and patent-pending
                       contact-locator feature that connects the address
                    book and calendar to the GPS mapping features.
                         Includes internal basemap, 32MB of internal memory,
                       SD card expansion slot. Compatible with MapSource
                         and BlueChart products for street-level mapping and
detailed marine charts.   

Aviation                                                                        

     Garmin's panel mounted product line includes  GPS-enabled  navigation,  VHF
communications  transmitters/receivers,  traditional  VHF navigation  receivers,
instrument landing  receivers,  digital  transponders  (which transmit either an
aircraft's altitude or its flight  identification number in response to requests
transmitted  by  ground-based  air traffic  control radar systems or air traffic
avoidance devices on other aircraft), marker beacon receivers and audio panels. 

     Garmin's  aviation  products have won  prestigious  awards  throughout  the
industry for their  innovative  features  and ease of use.  Garmin was the first
company to offer a GPS receiver, the GPS 155/165, which met the Federal Aviation
Administration's requirements for certain kinds of instrument approaches and did
so a full year ahead of its  competitors.  The GPS 155/165  with its  instrument
approach  capability won Flying  Magazine's  outstanding  achievement  award for
1994. The GNS 430/530 offers multiple features and capabilities  integrated into
a single product.  This high level of integration  minimizes the use of precious
space in the cockpit,  enhances the quality and safety of flight through the use
of modern  designs and  components and reduces the cost of equipping an aircraft
with modern  electronics.  The GNS 430 was also recognized by Flying Magazine as
the  Editor's  Choice  Product of the Year for 1998.  In 1994 and again in 2000,
Garmin  earned  recognition  from  the  Aircraft  Electronics   Association  for
outstanding  contribution  to the general  aviation  electronics  industry.  The
GPSMAP  295 won                                                                 

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Aviation  Consumer  Magazine's Gear of the Year award for best aviation portable
product in 2000 and again in 2001.  The GDL 49, the weather data link  interface
for  Garmin's 400 series and 500 series  products,  received  Flying  Magazine's
Editor's  Choice  award in 2002.  Garmin won first  place for  avionics  product
support in Professional  Pilot magazine's survey of its readers published in its
January 2003 issue.                                                             

     Garmin's panel mounted  aviation  products are sold in the retrofit  market
where older aircraft are fitted with the latest  electronics from Garmin's broad
product  line.  Garmin  believes  this  market  continues  to have  good  growth
potential as aircraft owners elect to upgrade their existing  aircraft at a cost
that is lower than purchasing a new aircraft.                                   

     Garmin has also gained market share as an original  equipment  manufacturer
supplier to leading airframe  manufacturers such as the Cessna Aircraft Company,
Cirrus Design Corporation, Diamond Aircraft Industries, EADS Socata, Eurocopter,
Mooney  Aircraft  Corporation,  New Piper Aircraft  Company,  Raytheon  Aircraft
Company, Pilatus Business Aircraft, and Robinson Helicopter.  Garmin anticipates
further growth in its sales to the original  equipment  manufacturers  market as
its  product  offerings  expand to include  flight  control  systems and primary
flight and multi-function  display  instrumentation  that use the latest display
technologies.                                                                   

     The table  below  includes  a  sampling  of some of the  aviation  products
currently offered by Garmin:                                                    

Handheld and portable aviation products:                                        

GPS III Pilot              Aviation style portable GPS receiver, with built-in  
 maps and Jeppesen database.

GPSMAP 196                 Portable GPS receiver with 3.8" diagonal moving map  
                         and Horizontal Situation Indicator(HSI)display with
                       internal basemap and automatic logbook functions.
                     Also features automatic turn-by-turn automotive
                          routing and MapSource compatibility for street level
mapping.                  

GPSMAP 295                 A high-end portable GPS receiver designed            
                    specifically for the serious aviator. Features
                      include a 16-color display and built-in aviation
                database; it can download MapSource CD-ROM
                         information  through a personal computer for street
level map details.        

Panel-mount aviation products:                                                  

GNC 300XL TSO              Instrument Flight Rules ("IFR ") certified  product  
                       that combines a GPS  receiver  with VHF radio and
   features moving map graphics.

400 Series                                                                      
(3 models)                 The GNS 430 is the world's first "all-in-one"  IFR   
                         certified GPS  navigation  receiver/traditional VHF
                       navigation  receiver/instrument  landing  systems
                           receiver and VHF communication  transmitter/receiver.
                        Features  available in different 400 series models
                          include 4-color map graphics, GPS, communication and
navigation capabilities.  

500 Series                                                                      
(2 models)                 These units combine the features of the 400 series   
           along with a larger 5" color display.

GI-102A & 106A             Course deviation  indicators  (CDIs).  The GI-106A   
                           features an instrument landing system receiver to aid
in landing.               

GMA 340                    A feature-rich audio panel with six-place stereo     
             intercom and independent pilot/co-pilot
  communications capabilities.

GTX 320A & 327             FAA-certified  transponders  which transmit altitude 
                           or flight identification to air traffic control radar
                        systems or other aircraft's air traffic  avoidance
devices and feature solid-

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                      state construction for longer life.  The GTX 327
                     offers a digital display with timing functions.

GTX 330 & 330D             FAA-certified Mode S transponders with data link     
                         capability, including local air traffic information
                          at FAA radar sites equipped with Traffic Information
Service (TIS).            

Aviation communications and datalink products:                                  

NavTalk Pilot              GPS-enabled cellular telephone, with built-in        
                           aviation database, offers AirCell(R) airborne service
                  so that pilots can make and receive cellular
     telephone calls while airborne.

GDL 49                     Satellite weather data link receiver for displaying  
                   weather information on the 400 and 500 series
products.                 

Sales and Marketing                                                             

     Garmin's  consumer  products  are  sold  through  a  worldwide  network  of
approximately  2,500  independent  dealers and distributors in approximately 100
countries who meet our sales and customer service qualifications. Garmin intends
to  selectively  grow its dealer  network  geographically  and by product lines.
Marketing  support is provided  geographically  from Garmin's offices in Olathe,
Kansas (North, South and Central America), Romsey, U.K. (Europe, Middle East and
Africa) and Shijr, Taiwan (Asia and Australia).  Garmin's  distribution strategy
is  intended  to  increase  Garmin's  global   penetration  and  presence  while
maintaining high quality standards to ensure end-user satisfaction.             

     Garmin's U.S. consumer segment marketing is handled through its dealers who
are  serviced  by  a  staff  of  regional  sales  managers  and  in-house  sales
associates. Some of Garmin's largest consumer products dealers include:         

       o Bass Pro Shops--a freshwater sports specialist with a sophisticated
catalog sales effort and "super store" locations;                               

o Best Buy--one of the largest U.S. electronics retailers;    

    o Boaters World--a leading off-shore marine retailer with multiple
locations;                                                

     o Cabela's--a major catalog retailer for the outdoor marine market;

o Circuit City--a leading U.S. electronics retailer;          

o Target--a leading mass merchandise chain of retail stores;  

o Wal-Mart--one of the world's largest mass retailers; and    

      o West Marine--one of the largest U.S. marine retailers specializing
in offshore boating equipment.                            

     Garmin's  Europe,  Middle East and Africa  consumer  segment  marketing  is
handled through in-country  distributors who resell to dealers.  Working closely
with  Garmin's  in-house  sales  and  marketing  staff in  Romsey,  U.K.,  these
distributors   are   responsible   for  inventory   levels  and  staff  training
requirements  at each retail  location.  Garmin's  Taiwan-based  marketing  team
handles its Asia marketing effort.                                              

     Aviation  marketing is handled through  dealers around the world.  Garmin's
largest  aviation  dealers include  Sportsmen's  Market,  Tropic Aero and JA Air
Center.  All have the training,  equipment and certified  staff required for the
at-airport  installation of Garmin's most sophisticated IFR avionics  equipment.
Visual Flight Rules ("VFR") equipment including handheld GPS receivers,  is sold
through dealers, usually at airport locations or through catalogs.              

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     In addition to the  traditional  distribution  channels  mentioned,  Garmin
enjoys significant market penetration with original equipment manufacturers.  In
the  consumer  market,   Garmin's  products  are  standard  equipment  on  boats
manufactured by Allison Boats,  Cigarette Racing Team,  Inc.,  Cobalt Boats, Pro
Sports Boats and Ranger Boats.  In the aviation  market,  Garmin's  avionics are
standard  equipment on aircraft built by Cessna Aircraft Company,  Cirrus Design
Corporation, EADS Socata, Eurocopter, Pilatus Business Aircraft, Mooney Aircraft
Corporation,  Raytheon Aircraft Company,  Robinson  Helicopter and The New Piper
Aircraft Company.  Other aircraft and boat manufacturers offer Garmin's products
as optional equipment.                                                          

Competition                                                                     

     The market for  navigation,  communications  and  information  products  is
highly competitive.  Garmin believes the principal competitive factors impacting
the market for its products are features,  quality,  design,  customer  service,
brand, price, time-to-market and availability. Garmin believes that it generally
competes favorably in these areas.                                              

     Garmin  believes that its principal  competitors  for consumer  GPS-enabled
product lines are Thales Navigation, Inc. ("Thales"),  Lowrance Electronics Inc.
("Lowrance"),   Cobra   Electronics   Corporation   ("Cobra"),   Raymarine  Ltd.
("Raymarine"), Furuno Electronic Company, the Standard Horizon Division of Yaesu
Co. Ltd. ("Standard"), the Northstar Technologies unit of Brunswick Corporation,
Navman Ltd. ("Navman") and Simrad AS ("Simrad").  For Garmin's  fishfinder/depth
sounder  product  lines,  Garmin  believes  that its principal  competitors  are
Lowrance,  Furuno,  Raymarine,  Simrad and the Humminbird  division of Teleflex,
Inc.  ("Humminbird").  Garmin believes that its principal competitors for marine
VHF transceiver product lines are Standard, Shakespeare Corporation, Humminbird,
Raymarine,  Uniden  Corporation,  Simrad and Icom,  Inc.  For  Garmin's  general
aviation  product  lines,  Garmin  considers  its  principal  competitors  to be
Lowrance, for portable GPS units, and UPS Aviation Technologies, a subsidiary of
United Parcel Service, Inc., Honeywell, Inc., Goodrich Corporation, Meggitt PLC,
Rockwell Collins,  Inc. and Avidyne  Corporation for panel-mount GPS and display
units.  For Garmin's  Family  Radio  Service and General  Mobile  Radio  Service
product line, Garmin believes that its principal competitors are Motorola,  Inc.
("Motorola"),  Cobra and Audiovox  Corporation.  For Garmin's  cellular  product
line, Garmin believes that its principal competitors are Nokia Oy, Telefon AB LM
Ericsson,  Motorola,  Benefon  Oy,  Siemens  AG  ("Siemens"),  Sony  Corporation
("Sony") and  Samsung.  For Garmin's  GPS sensor  board  product  lines,  Garmin
believes its principal competitors are Furuno, Koden, Trimble Navigation,  Ltd.,
Thales,  Motorola,  Philips  N.V.  ("Philips")  and SiRF  Technology,  Inc.  For
Garmin's automotive product lines, Garmin considers its principal competitors to
be Thales, Alpine Electronics,  Inc., Denso KK, Visteon, the On-Star Division of
General Motors Corporation, Navman, Xanavi Informatics Corporation, Robert Bosch
GmbH, and Siemens.  For Garmin's personal digital assistant product line, Garmin
considers its principal  competitors to be Palm, Inc.,  Handspring,  Inc., Sony,
Hewlett-Packard Company, Dell Computer Corporation and Toshiba Corporation.     

     For a  discussion  of  Garmin's  competitive  advantages,  see below  under
"Manufacturing and Operations".                                                 

Research and Development                                                        

     Garmin's product  innovations are driven by its strong emphasis on research
and  development  and the close  partnership  between  Garmin's  engineering and
manufacturing teams. Garmin's products are created by its engineering and design
staff of  approximately  340  people  worldwide.  Garmin's  manufacturing  staff
includes  manufacturing  process engineers who work closely with Garmin's design
engineers to ensure  manufacturability  and  manufacturing  cost control for its
products.  Garmin's  design  staff  includes  industrial  designers,  as well as
software  engineers,  electrical  engineers  and  mechanical  engineers.  Garmin
believes the  industrial  design of its products has played an important role in
Garmin's  success.  Once a  development  project is initiated  and  approved,  a
multi-disciplinary  team is created to design the product and transition it into
manufacturing.                                                                  

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     Below is a table of Garmin's  expenditures on research and development over
the last three fiscal years.                                                    

                        Fiscal Years Ended
                           -----------------------------------------------------
                             December 28,       December 29,      December 30,
                          2002                2001              2000
                           ------------------  -----------------  --------------
(In thousands)                                                                  
Research and development       $32,163            $28,164           $21,764     

Manufacturing and Operations                                                    

     Garmin  believes  that one of its core  competencies  is its  manufacturing
capability at both its Shijr,  Taiwan facility and its Olathe,  Kansas facility.
Garmin  believes  that its  vertically  integrated  approach has provided it the
following competitive advantages:                                               

     Reduced   time-to-market.   Utilizing  concurrent  engineering  techniques,
Garmin's products are introduced to production at an early development stage and
the feedback  provided by manufacturing  is incorporated  into the design before
mass production begins. In this manner, Garmin can significantly reduce the time
required to move a product from its design phase to mass production  deliveries,
with improved quality and yields.  Reducing time to market has enabled Garmin to
offer  several  industry  firsts,  such as the  Rino  GPS-enabled  Family  Radio
Service/General  Mobile  Radio  Service  two-way  radio  and the GNS 430,  which
integrates  traditional aviation navigation and communications  systems with GPS
in a single package.                                                            

     Design and process optimization.  Using its manufacturing resources, Garmin
can rapidly  prototype  design  concepts,  products  and  processes  in order to
achieve higher efficiency,  lower cost and best value for the customer. Garmin's
ability to fully explore product design and  manufacturing  process concepts has
enabled it to optimize  its designs to minimize  size and weight in a GPS device
that is fully functional, waterproof, and rugged.                               

     Logistical agility. Operating its own manufacturing facilities helps Garmin
minimize  problems  common  to  the  electronics  industry,  such  as  component
shortages and long component lead times.  Many products can be  re-engineered to
bypass  component  shortages or reduce cost and the new designs can quickly fill
the distribution pipeline.  Garmin can react rapidly to changes in market demand
by  maintaining  a  safety  stock of  long-lead  components  or by  rescheduling
components from one product line to another.                                    

     Garmin's  design and  manufacturing  processes are certified to ISO 9001/2,
international quality standards developed by the International  Organization for
Standardization.  Garmin's  Taiwan  manufacturing  facility has also achieved QS
9000  quality  certification.  QS  9000 is a  quality  standard  for  automotive
suppliers.  In addition Garmin's aviation  panel-mount products are designed and
manufactured according to processes which are approved and monitored by the FAA.

Intellectual Property                                                           

     Garmin's  success  and  ability  to  compete  is  dependent  in part on its
proprietary  technology.  Garmin relies on a combination  of patent,  copyright,
trademark  and trade  secret laws,  as well as  confidentiality  agreements,  to
establish and protect our proprietary  rights.  As of March 7, 2003, Garmin held
97 U.S.  patents that expire at various  dates no earlier than 2006. As of March
7, 2003, Garmin had 123 U.S. patent applications pending.  Garmin's U.S. patents
do not create any patent rights in foreign countries. In addition,  Garmin often
relies  on  licenses  of  intellectual  property  for use in its  business.  For
example,  Garmin obtains licenses for digital cartography  technology for use in
our products from various sources.  Garmin's registered U.S. trademarks include:
GARMIN;  the GARMIN logo; the GARMIN globe design;  the GARMIN "swoosh"  design;
STREETPILOT;  ETREX; ETREX VISTA, ETREX VENTURE, ETREX CAMO, ETREX SUMMIT; EMAP;
TRACBACK;  DCG; GPSMAP; GPS III; GPSV; PERSONAL  NAVIGATOR;  GUIDANCE BY GARMIN;
GPSCOM;  PHASETRAC  12;  TRACPAK;  G  CHART;  AUTOLOCATE;   BLUECHART;  NAVTALK;
MAPSOURCE;  METROGUIDE;  CITY SELECT and  SEE-THRU.  Our mark GARMIN and certain
other  trademarks  have also been  registered  in  selected  foreign  countries.
Garmin's  trademarks  include ETREX LEGEND;  ETREX MARINER;  RINO; IQUE; QUE and
GEKO. Some of                                                                   

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Garmin's  patents and its  registered  trademarks  and  trademarks  are owned by
Garmin's subsidiary, Garmin Corporation.                                        

     Garmin  believes  that its continued  success  depends in large part on the
intellectual  skills of its employees and their ability to continue to innovate.
Garmin will continue to file and prosecute patent  applications when appropriate
to attempt to protect Garmin's rights in its proprietary technologies.          

     It is possible that Garmin's current patents, or patents which it may later
acquire,  may be successfully  challenged or invalidated in whole or in part. It
is also  possible that Garmin may not obtain  issued  patents for  inventions it
seeks to protect.  It is also possible  that Garmin may not develop  proprietary
products or technologies  in the future that are patentable,  or that any patent
issued to Garmin may not provide it with any competitive advantages, or that the
patents  of others  will harm or  altogether  preclude  Garmin's  ability  to do
business.   Legal  protections  afford  only  limited  protection  for  Garmin's
technology.   Despite  Garmin's  efforts  to  protect  its  proprietary  rights,
unauthorized  parties  may attempt to copy  aspects of  Garmin's  products or to
obtain and use information that Garmin regards as proprietary. Litigation may be
necessary in the future to enforce Garmin's  intellectual  property  rights,  to
protect  its  trade  secrets,  to  determine  the  validity  and  scope  of  the
proprietary  rights of others or to defend  against  claims of  infringement  or
invalidity.  Any  resulting  litigation  could result in  substantial  costs and
diversion of Garmin's  resources.  Garmin's means of protecting its  proprietary
rights may not be adequate and Garmin's  competitors may  independently  develop
similar technology.                                                             

Regulations                                                                     

     Garmin's  aviation  products  that are  intended for  installation  in type
certificated  aircraft  are  required to be  certified  by the FAA, its European
counterpart,  the Joint Aviation Authorities, and other comparable organizations
before  they can be used in an  aircraft.  The  telecommunications  industry  is
highly  regulated,  and the regulatory  environment in which Garmin  operates is
subject to change. In accordance with Federal  Communication  Commission ("FCC")
rules and  regulations,  wireless  transceiver and cellular handset products are
required  to be  certified  by the FCC and  comparable  authorities  in  foreign
countries where they are sold.  Garmin's products sold in Europe are required to
comply with relevant directives of the European Commission. A delay in receiving
required certifications for new products or enhancements to Garmin's products or
losing  certification  for Garmin's existing products could adversely affect its
business.                                                                       

     Because Garmin Corporation, one of the Company's principal subsidiaries, is
located in Taiwan,  foreign exchange control laws and regulations of Taiwan with
respect to  remittances  into and out of Taiwan  may have an impact on  Garmin's
operations.  The  Taiwan  Foreign  Exchange  Control  Statute,  and  regulations
thereunder,  provide that all foreign exchange  transactions must be executed by
banks  designated  to handle such  business by the Ministry of Finance of Taiwan
and by the  Central  Bank  of  China,  also  referred  to as  the  CBC.  Current
regulations favor  trade-related  foreign exchange  transactions.  Consequently,
foreign  currency  earned from  exports of  merchandise  and services may now be
retained and used freely by exporters, while all foreign currency needed for the
import of merchandise  and services may be purchased  freely from the designated
foreign exchange banks. Aside from trade-related foreign exchange  transactions,
Taiwan  companies and residents may, without foreign  exchange  approval,  remit
outside and into Taiwan  foreign  currencies of up to $50 million and $5 million
respectively,  or their  equivalent,  each calendar year.  Currency  conversions
within the limits are  processed by the  designated  banks and do not have to be
reviewed  and  approved  by the CBC.  The  above  limits  apply  to  remittances
involving  a  conversion  between New Taiwan  Dollars and U.S.  Dollars or other
foreign currencies. The CBC typically approves foreign exchange in excess of the
limits  if a party  applies  with the CBC for  review  and  presents  legitimate
business  reasons  justifying  the currency  conversion.  A requirement  is also
imposed on all  enterprises  to register all medium and  long-term  foreign debt
with the CBC.                                                                   

Employees                                                                       

     As of December 31, 2002, Garmin had 1,575 full-time employees worldwide, of
whom 732 were in the United States, 804 were in Taiwan and 39 were in the United
Kingdom.  None of Garmin's employees are represented by a labor union or covered
by a collective bargaining agreement. Garmin considers its employee relations to
be good.                                                                        

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Item 2.  Properties                                                             

     Garmin's  U.S.  subsidiaries,  Garmin  International,  Inc. and Garmin USA,
Inc., occupy a 240,000 square foot facility on 41 acres in Olathe, Kansas, where
all aviation  panel-mount  products  are  manufactured  and Garmin  products are
warehoused,  distributed,  and supported for North,  Central and South  America.
Garmin's subsidiary, Garmin Realty, LLC also purchased an additional 46 acres of
land on the Olathe site in February,  2000 for future  expansion.  In connection
with the bond  financings  for the facility in Olathe and the  expansion of that
facility,  the City of Olathe  holds the legal title to this  property  which is
leased to  Garmin's  subsidiaries  by the City.  Upon the payment in full of the
outstanding bonds, the City of Olathe is obligated to transfer title to Garmin's
subsidiaries for the aggregate sum of $200.                                     

     On December  16, 2002 Garmin  announced  that its U.S.  subsidiary,  Garmin
International,  Inc., plans to begin construction in 2003 of an expansion to its
Olathe, Kansas facility.  This building expansion is expected to be completed in
2004.                                                                           

     In December 2001,  Garmin  International,  Inc. entered into a ground lease
for 148,320 square feet of land at New Century Airport in Gardner,  Kansas. This
ground  lease  expires in 2026.  In January  2002,  Garmin  International,  Inc.
completed  construction of a 25,034 square foot aircraft hangar, flight test and
certification  facility on this land for use in development and certification of
aviation products.                                                              

     Garmin's  subsidiary,  Garmin  Corporation,  owns  a  249,326  square  foot
facility in Shijr,  Taipei County,  Taiwan where it manufactures all of Garmin's
consumer and portable  aviation  products and  warehouses,  markets and supports
products for the Pacific Rim  countries.  Garmin  Corporation  occupies  208,375
square feet at this  facility  and leases the  remaining  40,951  square feet to
third parties.                                                                  

     Garmin's  subsidiary,  Garmin (Europe) Ltd.,  leases an aggregate of 28,358
square feet under three leases in Romsey, England for warehousing, marketing and
supporting  Garmin  products  in  Europe,  Africa and the  Middle  East.  Garmin
(Europe)  Ltd.  also  repairs  products at this  facility.  One of these  leases
expires in 2010 and two of these leases  expire in 2015.  Garmin  International,
Inc.  also leases an  aggregate  of 3,233  square feet of office space in Tempe,
Arizona for software development,  and Wichita,  Kansas for support for Garmin's
aviation original equipment manufacturer operations.                            

Item 3.  Legal Proceedings                                                      

     From time to time, Garmin may be involved in litigation  relating to claims
arising out of our  operations.  As of March 7, 2003,  Garmin was not a party to
any material legal proceedings.                                                 

Item 4.  Submission of Matters to a Vote of Security Holders                    

Not applicable.                                               

Executive Officers and Significant Employees of the Company                     

     Pursuant  to General  Instruction  G(3) of Form 10-K and  instruction  3 to
paragraph (b) of Item 401 of Regulation  S-K, the following  list is included as
an unnumbered Item in Part I of this Annual Report on Form 10-K in lieu of being
included in the Company's  Definitive  Proxy  Statement in  connection  with its
annual meeting of shareholders scheduled for June 6, 2003.                      

     Gary L. Burrell,  age 65, has served as  Co-Chairman  of Garmin Ltd.  since
August 2000.  He also served as Co-Chief  Executive  Officer of Garmin Ltd. from
August 2000 to August 2002. He has been a director of Garmin  Corporation  since
January 1990. He served as President of Garmin  Corporation from January 1990 to
December 1998. Mr. Burrell has also been Chairman of Garmin International,  Inc.
since March 2002, a director of Garmin                                          

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International,  Inc.  since  August  1990 and he served as  President  of Garmin
International,  Inc.  from  August  1990 to March  2002.  Mr.  Burrell  has been
Chairman of Garmin USA, Inc. since March 2002 and a director of Garmin USA, Inc.
since  December  2001.  He served as President of Garmin USA, Inc. from December
2001 to March  2002.  Mr.  Burrell  has been a director  and  Chairman of Garmin
(Europe) Ltd.  since 1992.  Mr.  Burrell was a director of Garmin  Foreign Sales
Corporation  from May 1998 to  December  2001 and  President  from  July 1998 to
December  2001.  Mr.  Burrell holds a BS degree in Electrical  Engineering  from
Wichita  State  University  and  a MS  degree  in  Electrical  Engineering  from
Rensselaer Polytechnic Institute.                                               

     Dr. Min H. Kao,  age 54, has served as  Co-Chairman  of Garmin  Ltd.  since
August  2000.  He has served as Chief  Executive  Officer of Garmin  Ltd.  since
August 2002 and previously served as Co-Chief Executive Officer from August 2000
to August 2002. He has been President of Garmin  Corporation since January 1999.
He has also been  Chairman and a director of Garmin  Corporation  since  January
1990. Dr. Kao has been President of Garmin International,  Inc. since March 2002
and a director of Garmin  International,  Inc.  since August 1990.  He served as
Vice President of Garmin International,  Inc. from April 1991 to March 2002. Dr.
Kao has been  President of Garmin USA,  Inc.  since March 2002 and a director of
Garmin USA, Inc. since December 2001. He served as Vice President of Garmin USA,
Inc. from December 2001 to March 2002. He has been a director of Garmin (Europe)
Ltd. since 1992. Dr. Kao was a director of Garmin Foreign Sales Corporation from
May 1998 to December 2001 and Vice  President  from July 1998 to December  2001.
Dr. Kao holds Ph.D. and MS degrees in Electrical Engineering from the University
of Tennessee and a BS degree in  Electrical  Engineering  from  National  Taiwan
University.                                                                     

     Kevin S.  Rauckman,  age 40,  has  served as Chief  Financial  Officer  and
Treasurer of Garmin Ltd.  since August 2000. He has been Director of Finance and
Treasurer of Garmin  International,  Inc.  since  January 1999 and a director of
Garmin  International,  Inc.  since  April  2001.  He has been  Treasurer  and a
director of Garmin USA, Inc. since  December  2001. Mr.  Rauckman was a director
and Treasurer of Garmin Foreign Sales  Corporation from January 1999 to December
2001.  Previously,  Mr.  Rauckman  served as  Director  of Finance  and in other
finance   capacities  for  one  of  Allied  Signal's  (now  known  as  Honeywell
International, Inc.) Aerospace units from May 1996 to January 1999 and served as
Finance Manager with Unisys  Corporation,  a technology  hardware and consulting
services  company,  from June 1993 to April 1996. Mr.  Rauckman holds BS and MBA
degrees in Business from the University of Kansas.                              

     Andrew R. Etkind,  age 47, has served as General  Counsel and  Secretary of
Garmin  Ltd.  since  August  2000.  He  has  been  General   Counsel  of  Garmin
International, Inc. since February 1998 and Secretary since October 1998. He has
been General  Counsel and Secretary of Garmin USA,  Inc.  since  December  2001.
Previously, Mr. Etkind served as Senior Attorney for Alumax Inc., a manufacturer
of aluminum and aluminum products,  from March 1996 to January 1998 and was Vice
President,  General Counsel and Secretary of Information  Management  Resources,
Inc., a software systems development and consulting  company,  from July 1993 to
February  1996.  Mr.  Etkind  holds  BA,  MA  and  LLM  degrees  from  Cambridge
University, England and a JD degree from the University of Michigan Law School. 

     Gary  V.  Kelley,  age  56,  has  been  Director  of  Marketing  of  Garmin
International,  Inc. since 1992 and has been a director of Garmin  (Europe) Ltd.
since 1993.  He has also been  Director of Marketing of Garmin USA,  Inc.  since
January 2002. Mr. Kelley holds a BBA degree from Baker University. He also holds
a commercial pilot license with instrument and flight instructor ratings.       

     All  executive  officers are elected by and serve at the  discretion of the
Company's  Board of Directors.  None of the executive  officers have  employment
agreements with the Company. There are no arrangements or understandings between
the executive  officers and any other person  pursuant to which he or she was or
is to be selected as an officer.  None of the executive  officers are related to
one another. Dr. Min H. Kao is the brother of Ruey-Jeng Kao, who is a supervisor
of Garmin  Corporation.  Elected by the  shareholders of Garmin  Corporation,  a
supervisor  serves as an ex-officio  member of its Board of Directors to protect
the interests of all shareholders.                                              

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 PART II

Item 5.  Market for the Company's Common Stock and Related Stockholder Matters  

     The Company's common shares have traded on the Nasdaq National Market under
the symbol "GRMN" since its initial  public  offering on December 8, 2000. As of
March 7, 2003 there were 148 shareholders of record.                            

     No cash dividends  have been paid since the initial public  offering of the
Company's  common shares on December 8, 2000. The Company  intends to retain its
earnings for use in its business and  therefore  does not  currently  anticipate
paying any cash dividends.                                                      

     The range of high and low  closing  sales  prices of the  Company's  common
shares as reported on the Nasdaq Stock Market for each fiscal  quarter of fiscal
years 2001 and 2002 was as follows:                                             

      ------------------------------------------------------------------------
                         Year Ended                   Year Ended
      ------------------------------------------------------------------------
                           December 28, 2002             December 29, 2001
      ------------------------------------------------------------------------
                             High          Low             High          Low
      ------------------------------------------------------------------------

      ------------------------------------------------------------------------
      First Quarter          $22.92        $18.76          $25.13       $17.00
      ------------------------------------------------------------------------
      Second Quarter         $24.19        $21.80          $24.68       $18.00
      ------------------------------------------------------------------------
      Third Quarter          $21.90        $18.10          $23.36       $14.40
      ------------------------------------------------------------------------
      Fourth Quarter         $30.33        $18.00          $21.32       $15.50
      ------------------------------------------------------------------------

     No net proceeds of Garmin's  December 8, 2000 initial public  offering (the
"IPO") were  expended in fiscal year 2002.  $13.4 million of net proceeds of the
IPO were expended in fiscal year 2001.  Garmin plans to use the remaining  $91.0
million  net  proceeds  from  the IPO for  working  capital  and  other  general
corporate  purposes,  including  possible  share  repurchases,  acquisitions  or
strategic  partnerships.  Garmin  currently has no specific plan for  allocating
those  proceeds  among  working  capital and other general  corporate  purposes.
Garmin  currently  has no  commitments  to  make  any  material  investments  or
acquisitions  and will retain broad discretion in the allocation of net proceeds
from the IPO.                                                                   

Item 6.  Selected Financial Data                                                

     The following table sets forth selected consolidated  financial data of the
Company.  The selected  consolidated  balance sheet data as of December 28, 2002
and December 29, 2001 and the selected consolidated statement of income data for
the years ended December 28, 2002, December 29, 2001, and December 30, 2000 were
derived from the Company's  audited  consolidated  financial  statements and the
related notes thereto which are included in Item 8 of this annual report on Form
10-K.  The  selected  consolidated  balance  sheet data as of December 30, 2000,
December 25, 1999 and December 26, 1998 and the selected consolidated  statement
of income data for the years ended  December 25, 1999 and December 26, 1998 were
derived  from the  Company's  audited  consolidated  financial  statements,  not
included herein.                                                                

     The  information  set  forth  below is not  necessarily  indicative  of the
results of future  operations  and should be read  together  with  "Management's
Discussion and Analysis of Financial  Condition and Results of  Operations"  and
the consolidated  financial statements and notes to those statements included in
Items 7 and 8 in Part II of this Form 10-K.                                     

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                                                        [Enlarge/Download Table]


                                                                        Years ended (1)                                  
                                       ----------------------------------------------------------------------------------
                                            Dec. 28,        Dec. 29,         Dec. 30,          Dec. 25,         Dec. 26, 
                                             2002            2001             2000              1999             1998    
                                       ----------------------------------------------------------------------------------
                                                             (in thousands, except per share data)                       
                                                                                                                         
Consolidated Statements of                                                                                               
Income Data:                                                                                                             
    Net sales                              $465,144         $369,119         $345,741          $232,586         $169,030 
    Cost of goods sold                      210,088          170,960          162,015           105,654           82,787 
                                         -----------     ------------     ------------       -----------       --------- 

        Gross profit                        255,056          198,159          183,726           126,932           86,243 
    Operating expenses:                                                                                                  
        Selling, general and                                                                                             
              administrative                 45,453           38,709           32,669            27,063           24,680 
        Research and                                                                                                     
              development                    32,163           28,164           21,764            17,339           14,876 
                                         -----------     ------------     ------------       -----------       --------- 
    Total operating expenses                 77,616           66,873           54,433            44,402           39,556 
                                         -----------     ------------     ------------       -----------       --------- 
    Operating income                        177,440          131,286          129,293            82,530           46,687 
    Other income, net (2), (3)                5,294           20,749           11,629             1,602              833 
                                         -----------     ------------     ------------       -----------       --------- 
    Income before income                                                                                                 
               taxes                        182,734          152,035          140,922            84,132           47,520 
    Income tax provision                     39,937           38,587           35,259            19,965           12,354 
                                         -----------     ------------     ------------       -----------       --------- 
                      Net income            142,797         $113,448         $105,663           $64,167          $35,166 
                                         ===========     ============     ============       ===========       ========= 

    Net income per share:                                                                                                
                   Basic                      $1.32            $1.05            $1.05             $0.64            $0.35 
                   Diluted                    $1.32            $1.05            $1.05             $0.64            $0.35 
    Weighted average common                                                                                              
        shares outstanding:                                                                                              
                   Basic                    107,774          108,097          100,489           100,000           99,624 
                   Diluted                  108,201          108,447          100,506           100,000           99,624 

    Cash dividends per share (4)              $0.00            $0.00            $0.29             $0.13            $0.12 

Consolidated Balance Sheet Data                                                                                          
(at end of Period):                                                                                                      
    Cash and cash equivalents              $216,768         $192,842         $251,731          $104,079          $80,360 
    Marketable securities                  $245,708         $131,584               $0                $0               $0 
    Total assets                           $698,115         $538,984         $463,347          $250,090         $174,532 
    Total debt (5)                          $20,000          $32,188          $46,946           $27,720           $9,708 
    Total stockholders' equity             $602,499         $453,969         $365,239          $194,599         $135,940 

------------------------------------------------------------------------------------------------------------------------ 

(1)  Our fiscal year-end is the last Saturday of the calendar year and does not 
always fall on December 31.                                           
(2)  Other income, net mainly consists of interest income, interest expense and 
foreign currency gain (loss).                                         
(3)  Includes $0.0 million, $11.6 million, $7.0 million, ($1.5) million, and    
   (2.2) million of foreign currency gains (losses) during 2002, 2001, 2000,
1999, and 1998 respectively.                                          
(4)  Represents cash dividends per share based on the actual number of shares   
     outstanding at the time of the dividend, as adjusted for the 1.12379256 for
  1 stock split of our common shares, effected through a stock dividend on
     November 6, 2000.  There were no cash dividends issued during 2002 or 2001.
(5)  Total debt consists of notes payable and long-term debt.                   

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Item 7. Management's  Discussion and Analysis of Financial Condition and Results
of Operations                                                   

     The  following  discussion  and  analysis of our  financial  condition  and
results of  operations  focuses on and is intended to clarify the results of our
operations,  certain  changes  in our  financial  position,  liquidity,  capital
structure and business  developments for the periods covered by the consolidated
financial  statements included in this Form 10-K. This discussion should be read
in  conjunction  with,  and is  qualified  by  reference  to, the other  related
information  including,  but not limited to, the audited consolidated  financial
statements  (including the notes thereto and the  independent  auditor's  report
thereon),  the description of our business,  all as set forth in this Form 10-K,
as well as the risk factors  discussed below (the  "Company-Specific  Trends and
Risks").                                                                        

     As  previously  noted,  the  discussion  set forth below,  as well as other
portions of this Form 10-K,  contains  statements  concerning  potential  future
events.  Readers can identify these  forward-looking  statements by their use of
such verbs as expects, anticipates, believes or similar verbs or conjugations of
such verbs.  If any of our  assumptions  on which the statements are based prove
incorrect or should unanticipated  circumstances arise, our actual results could
materially differ from those anticipated by such forward-looking statements. The
differences  could be caused by a number of  factors or  combination  of factors
including,  but not limited to, the  Company-Specific  Trends and Risks. Readers
are strongly  encouraged  to consider  those  factors when  evaluating  any such
forward-looking  statement. We will not update any forward-looking statements in
this Form 10-K.                                                                 

     Beginning in 1998, the Company elected to change its fiscal year to a 52-53
week period ending on the last Saturday of the calendar  year.  Fiscal year 2000
contained 53 weeks  compared to 52 weeks for fiscal years 2002,  2001,  1999 and
1998. Unless otherwise stated, all years and dates refer to the Company's fiscal
year and fiscal periods.  Unless the context otherwise  requires,  references in
this  document to "we," "us," "our" and similar  terms refer to Garmin Ltd.  and
its subsidiaries.                                                               

Overview                                                                        

     We are a leading  worldwide  provider  of  navigation,  communications  and
information devices,  most of which are enabled by Global Positioning System, or
GPS, technology.  We operate in two business segments, the consumer and aviation
markets.  Both of our segments offer products through our network of independent
dealers and distributors. However, the nature of products and types of customers
for the two  segments  vary  significantly.  As such,  the  segments are managed
separately. Our consumer segment includes portable GPS receivers and accessories
for marine,  recreation,  land and  automotive  applications  sold  primarily to
retail outlets.  Our aviation products are portable and panel-mount avionics for
Visual  Flight  Rules  and  Instrument  Flight  Rules  navigation  and are  sold
primarily to retail outlets and certain aircraft manufacturers.                 

     Since our first products were delivered in 1991, we have generated positive
income from  operations each year and have funded our growth from these profits.
Our sales have  increased at a compounded  annual  growth rate of 23% since 1996
and our net income has increased at a compounded annual growth rate of 36% since
1996. All of this growth has been organic;  none has occurred as a result of any
acquisition or merger.                                                          

     Since our  principal  locations  are in the United  States,  Taiwan and the
U.K., we experience some foreign currency fluctuations in our operating results.
The functional currency of our European operations is the U.S. dollar (effective
in 2001) and the functional  currency of our Asian  operations is the New Taiwan
Dollar.  Minimal  transactions of our European operations are now denominated in
British Pound  Sterling.  We  experienced  $0.0  million,  $11.6  million,  $7.0
million,  and $(1.5) million in foreign  currency  gains (losses)  during fiscal
years 2002,  2001,  2000, and 1999,  respectively.  To date, we have not entered
into  hedging  transactions  with either the British  Pound  Sterling or the New
Taiwan Dollar, although we may utilize hedging transactions in the future.      

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Critical Accounting Policies and Estimates                                      

General                                                                         

     The  Company's  discussion  and  analysis of its  financial  condition  and
results  of  operations  are based  upon the  Company's  consolidated  financial
statements,  which have been prepared in accordance with  accounting  principles
generally  accepted in the United States.  The  presentation  of these financial
statements requires the Company to make estimates and judgements that affect the
reported  amounts of assets,  liabilities,  revenues and  expenses,  and related
disclosure of  contingent  assets and  liabilities.  On an on-going  basis,  the
Company  evaluates its  estimates,  including  those  related to customer  sales
programs and incentives,  product returns, bad debts, inventories,  investments,
intangible assets,  income taxes,  warranty  obligations,  and contingencies and
litigation.  The Company  bases its estimates on  historical  experience  and on
various  other  assumptions  that  are  believed  to  be  reasonable  under  the
circumstances,  the results of which form the basis for making  judgements about
the carrying value of assets and liabilities  that are not readily apparent from
other sources.  Actual results may differ from these  estimates  under different
assumptions or conditions.                                                      

Revenue Recognition                                                             

     The Company  records  estimated  reductions  to revenue for customer  sales
programs and incentive offerings including rebates, price protection, promotions
and other  volume-based  incentives.  The  reductions  to  revenue  are based on
estimates and judgements using  historical  experience and expectation of future
conditions.  Changes in these  estimates could  negatively  affect the Company's
operating  results.  These  incentives  are accrued for on a percentage of sales
basis and  reviewed  periodically.  If market  conditions  were to decline,  the
Company  may take  actions to increase  customer  incentive  offerings  possibly
resulting in an  incremental  reduction of revenue at the time the  incentive is
offered.                                                                        

Bad Debt                                                                        

     The Company maintains allowances for doubtful accounts for estimated losses
resulting  from the inability of its customers to make  required  payments.  The
Company's estimated losses are based on historical experience and expectation of
future conditions. If the financial condition of the Company's customers were to
deteriorate,  resulting  in an  impairment  of their  ability to make  payments,
additional allowances may be required.                                          

Warranties                                                                      

     The Company's products sold are generally covered by a warranty for periods
ranging  from one to two  years.  The  Company  accrues a warranty  reserve  for
estimated costs to provide warranty services. The Company's estimate of costs to
service  its  warranty  obligations  is  based  on  historical   experience  and
expectation  of  future  conditions.  To  the  extent  the  Company  experiences
increased  warranty claim activity or increased costs  associated with servicing
those claims,  its warranty  accrual will increase  resulting in decreased gross
profit.                                                                         

Product Liability                                                               

     The Company has no product liability claims  outstanding as of December 28,
2002 that are not covered by product liability insurance.                       

Inventory                                                                       

     The  Company  writes  down its  inventory  for  estimated  obsolescence  or
unmarketable inventory equal to the difference between the cost of inventory and
the estimated market value based upon assumptions about future                  

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demand and market  conditions.  If actual market  conditions  are less favorable
than those  projected by management,  additional  inventory  write-downs  may be
required.                                                                       

Investments                                                                     

     Investments  are  classified  as  available  for sale and  recorded at fair
value, and unrealized investment gains and losses are reflected in stockholders'
equity.  Investment income is recorded when earned, and capital gains and losses
are recognized when investments are sold.  Investments are reviewed periodically
to determine if they have  suffered an  impairment  of value that is  considered
other than temporary.  If investments  are determined to be impaired,  a capital
loss is recognized at the date of determination.                                

     Testing for impairment of investments also requires significant  management
judgement.   The  identification  of  potentially  impaired   investments,   the
determination  of their fair value and the  assessment of whether any decline in
value is other than temporary are the key judgement  elements.  The discovery of
new  information  and  the  passage  of  time  can  significantly  change  these
judgements.  Revisions of impairment  judgements  are made when new  information
becomes known, and any resulting  impairment  adjustments are made at that time.
The current  economic  environment and recent  volatility of securities  markets
increase the  difficulty  of  determining  fair value and  assessing  investment
impairment.  The  same  influences  tend to  increase  the  risk of  potentially
impaired assets.                                                                

Income Taxes                                                                    

     While no valuation allowance has been recorded,  it is the Company's policy
to record a valuation  allowance  to reduce its deferred tax assets to an amount
that it believes is more likely than not to be  realized.  While the Company has
considered  future taxable income and ongoing  prudent and feasible tax planning
strategies in assessing the need for the valuation  allowance,  in the event the
Company  were to  determine  that it would not be able to realize all or part of
its net deferred  tax assets in the future,  an  adjustment  to the deferred tax
assets  would be charged to income in the period  such  determination  was made.
Likewise,  should the  Company  determine  that it would be able to realize  its
deferred  tax  assets in the  future in excess of its net  recorded  amount,  an
adjustment to the deferred tax assets would  increase  income in the period such
determination was made.                                                         

Impairments and Restructuring Charges                                           

     The Company has experienced no impairments of long-lived assets, securities
held for investment, or goodwill. No restructuring charges have been necessary. 

Depreciation and Amortization                                                   

     The Company  depreciates  or amortizes  its assets using the  straight-line
method.                                                                         

Retirement and Post Retirement Liabilities; Pension Income and Expense          

     The retirement  benefits  provided by the Company are classified as defined
contribution  plans.  As this is the case,  there is no retirement  liability to
fund.  Because the retirement  benefits  provided by the Company are not defined
benefit plans,  there are no funds held in trust and therefore no pension income
or expense disclosures are necessary.                                           

Environmental Liabilities                                                       

 The Company is not aware of any environmental liabilities at this time.

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Repurchase Obligations                                                          

The Company has no repurchase obligations at this time.               

Stock-based Compensation                                                        

     The Company  distributes  a small number of stock options each year as part
of the Company's  compensation  package for  employees.  Employees  with certain
levels of  responsibility  within the Company  are  eligible  for stock  options
grants,  but the granting of options is at the  discretion  of the  Compensation
Committee of the Board of Directors and is not a contractual  obligation.  Stock
compensation  plans  are  discussed  in  detail  in  Note  13 of  the  Notes  to
Consolidated Financial Statements.                                              

Insurance Loss Reserves                                                         

     Historically  the Company has not experienced  losses related to general or
product liability claims, therefore no loss reserves have been created.         

Accounting Terms and Characteristics                                            

Net Sales                                                                       

     Our net sales are  primarily  generated  through sales to our global dealer
and distributor  network and to original equipment  manufacturers.  We recognize
sales when  products  are shipped.  Our sales are largely of a consumer  nature;
therefore  backlog  levels are not  necessarily  indicative  of our future sales
results.  We aim to  achieve a quick  turnaround  on orders we  receive,  and we
typically ship most orders within 72 hours.                                     

     Net sales are subject to some seasonal fluctuation. Typically, sales of our
consumer  products are highest in the second  quarter,  due to increased  demand
during the spring and summer marine season,  and in the fourth  quarter,  due to
increased demand during the holiday buying season.  Our aviation products do not
experience much seasonal variation, but are more influenced by the timing of the
release of new products when the initial demand is typically the strongest.     

Gross Profit                                                                    

     The most significant components of our cost of goods sold are raw material,
labor and depreciation.  Raw material costs, which are our most significant cost
item,  have come down slightly as a percentage  of sales in recent years,  as we
have  negotiated  lower raw material costs with our key suppliers.  As a result,
gross profit has improved  somewhat as a percentage  of sales when compared with
prior years.                                                                    

     In 2000, we  experienced  upward pricing  pressures on our high  technology
components,  but  had  offset  those  with  efficiencies  in  our  manufacturing
processes. We did not experience significant pricing pressure in fiscal 2001 and
fiscal 2002. Our existing  practice of performing the design and  manufacture of
our  products  in-house  has  enabled  us  to  utilize  alternative  lower  cost
components  from  different  suppliers  and,  where  necessary,  to redesign our
products  to permit us to use these  lower  cost  components.  We  believe  that
because of our practice of performing the design,  manufacture  and marketing of
our products in-house,  both our Shijr, Taiwan and Olathe,  Kansas manufacturing
plants have experienced  relatively low costs of manufacturing,  compared to our
competition.  In general,  products manufactured in Taiwan have been our highest
volume products.  Our manufacturing  labor costs historically have been lower in
Taiwan than in Olathe.                                                          

     Sales  price  variability  has had and can be expected to have an effect on
our gross profit.  In the past, prices of some of our handheld devices sold into
the consumer  market have declined due to market  pressures and  introduction of
new  products  sold at lower price  points.  The average  selling  prices of our
aviation  products  have  decreased  due to  product  mix and  market  pressures
partially  offset by the  introduction of more advanced  products               

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sold at higher  prices.  In  conjunction  with the  effects of lower labor costs
experienced  on Taiwan  production,  the effect of the sales  price  variability
inherent  within the mix of  GPS-enabled  products sold could have a significant
impact on our gross profit.                                                     

Selling, General and Administrative Expenses                                    

Our selling, general and administrative expenses consist primarily of:

o   salaries for sales and marketing personnel;                 

o   salaries and related costs for executives and administrative
personnel;                                              

o   advertising, marketing, and other brand building costs;     

o   accounting and legal costs;                                 

o   information systems and infrastructure costs;               

o   travel and related costs; and                               

o   occupancy and other overhead costs.                         

     Since we plan to  increase  market  penetration  in the  future,  we expect
selling,  general and  administrative  expenses to continue to increase  for the
foreseeable future. We intend to increase  advertising and marketing expenses in
order to build increased brand awareness in the consumer marketplace, especially
as we enter into new markets,  such as wireless and personal digital  assistants
(PDA).  We also  intend to increase  our  customer  call  center  support as our
consumer  segment  continues to grow. We do not anticipate  that these increased
expenses will significantly  impact our financial results in 2003 and subsequent
periods.                                                                        

Research and Development                                                        

     The majority of our research and development  costs represent  salaries for
our  engineers,  costs  for  high  technology  components  used in  product  and
prototype  development,  and  costs  of test  equipment  needed  during  product
development.                                                                    

     We have continued to grow our research and development  capabilities  since
our inception. Substantially all of the research and development of our products
is performed in the United States.                                              

     We  are  committed  to  increasing  the  level  of  innovative  design  and
development  of new  products  as we strive  for  expanded  ability to serve our
existing  consumer and aviation  markets as well as new markets for  GPS-enabled
devices.  We continue to grow our  research and  development  budget on absolute
terms.  Research  and  development  expenses may also grow at a faster rate when
compared to our projected revenue growth for fiscal year 2003.                  

Customers                                                                       

     No customer  accounted  for greater than 10% of our sales in the year ended
December 28, 2002. Our top ten customers  accounted for approximately 25% of net
sales.  We  have  experienced  average  sales  days  in  our  customer  accounts
receivable between 35 and 45 days since 1998.                                   

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Income Taxes                                                                    

     We have  experienced  a relatively  low effective tax rate in Taiwan due to
lower marginal tax rates and substantial tax incentives offered by the Taiwanese
government on certain  high-technology capital investments.  Therefore,  profits
earned in Taiwan have been taxed at a lower rate than those in the United States
and Europe. As a result,  our consolidated  effective tax rate was approximately
22% during 2002. We have taken advantage of this tax benefit in Taiwan since our
inception and we expect to continue to benefit from lower effective tax rates at
least through 2007. The current  Taiwan tax incentives  that Garmin has received
approval for will end in 2007.  We have applied for  additional  incentives  for
years beyond 2007.  However,  there can be no assurance that such tax incentives
will be granted after 2007.                                                     

Results of Operations                                                           

     The following table sets forth our results of operations as a percentage of
net sales during the periods shown:                                             

                                              Fiscal Years Ended
                                               ---------------------------------
                                               Dec. 28,    Dec. 29,     Dec. 30,
                                               2002        2001         2000
                                               ---------------------------------

         Net sales                               100.0%      100.0%       100.0%
         Cost of goods sold                       45.2%       46.3%        46.9%
                                                  -----       -----        -----
         Gross profit                             54.8%       53.7%        53.1%
Operating expenses:                                           
         Selling, general and administrative       9.8%       10.5%         9.4%
         Research and development                  6.9%        7.6%         6.3%
                                                   ----        ----         ----
         Total operating expenses                 16.7%       18.1%        15.7%
                                                  -----       -----        -----
         Operating income                         38.1%       35.6%        37.4%
         Other income, net                         1.2%        5.6%         3.4%
                                                   ----        ----         ----
         Income before income taxes               39.3%       41.2%        40.8%
         Provision for income taxes                8.6%       10.5%        10.2%
                                                   ----       -----        -----
         Net income                               30.7%       30.7%        30.6%
                                                  =====       =====        =====

     The following  table sets forth our results of  operations  for each of our
two segments through income before taxes during the periods shown. For each line
item in the table,  the total of the  consumer and  aviation  segments'  amounts
equals the amount in the consolidated statements of income included in Item 8.  

                                                        [Enlarge/Download Table]


                                                                Fiscal Years Ended                             
                                     --------------------------------------------------------------------------
                                        December 28, 2002       December 29, 2001        December 30, 2000     
                                        -----------------       -----------------        -----------------     
                                          (in thousands)           (in thousands)          (in thousands)      
                                       Consumer    Aviation    Consumer     Aviation    Consumer    Aviation   
                                       --------    --------    --------     --------    --------    --------   
                                                                                                               
Net sales                                $350,674    $114,470    $263,358     $105,761    $230,183    $115,558 
Cost of goods sold                        166,130      43,958     130,836       40,124     114,656      47,359 
                                     --------------------------------------------------------------------------

Gross profit                              184,544      70,512     132,522       65,637     115,527      68,199 
Operating expenses:                                                                                            
Selling, general and administrative        35,114      10,339      29,018        9,691      23,756       8,913 
Research and development                   18,863      13,300      18,197        9,967      14,210       7,554 
                                     --------------------------------------------------------------------------

Total operating expenses                   53,977      23,639      47,215       19,658      37,966      16,467 
                                     --------------------------------------------------------------------------

Operating income                          130,567      46,873      85,307       45,979      77,561      51,732 
Other income, net                           4,292       1,002      17,204        3,545      10,542       1,087 
                                     --------------------------------------------------------------------------

Income before income taxes               $134,859     $47,875    $102,511     $ 49,524     $88,103     $52,819 
                                         =========    ========   =========    =========    ========    ======= 


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Comparison of Fiscal Years Ended December 28, 2002 and December 29, 2001        

Net Sales                                                                       

     Net sales increased  $96.0 million,  or 26.0%, to $465.1 million for fiscal
year ended December 28, 2002, from $369.1 million for fiscal year ended December
29, 2001. The increase during fiscal 2002 was primarily due to the  introduction
of 22 new products and overall demand for our consumer products.  Sales from our
consumer  products  accounted for 75.4% of net revenues for fiscal 2002 compared
to 71.3% during  fiscal 2001.  Sales from our aviation  products  accounted  for
24.6% of net  revenues  for fiscal 2002  compared to 28.7%  during  fiscal 2001.
Total consumer and aviation units sold increased 17.0% to 1,557,000 in 2002 from
1,331,000 in 2001. In general,  management  believes that continuous  innovation
and the introduction of new products are essential for future revenue growth.   

     Net sales for the consumer  segment  increased $87.3 million,  or 33.2%, to
$350.7 million for fiscal 2002 from $263.4 million for fiscal 2001. The increase
was primarily due to the  introduction  of 18 new consumer  products and overall
demand  for our  consumer  products  as total  units  sold were up 17.1%.  It is
management's  belief  that  the  continued  demand  for the  Company's  consumer
products  is due to the  emergence  of the GPS market in  general,  and  overall
increased consumer awareness of the capabilities and applications of GPS.       

     Net sales for the aviation  segment  increased  $8.7  million,  or 8.2%, to
$114.5 million for fiscal 2002 from $105.8 million for fiscal 2001. The increase
for fiscal 2002 was  primarily  due to the  introduction  of four new  products,
increased  penetration  into the OEM market,  and significant  reductions of the
restrictions  placed on general  aviation  following the events of September 11,
2001.  While Temporary  Flight  Restrictions  (TFR's) continue to impact general
aviation, the flying community is adapting to these changes and returning to the
skies in greater  numbers.  Should the  Federal  Aviation  Administration  (FAA)
impose  more  restrictions,  or elect to shutdown  U.S.  airspace in the future,
these factors could have a material adverse effect on our business.             

Gross Profit                                                                    

     Gross profit  increased  $56.9  million,  or 28.7%,  to $255.1  million for
fiscal  year 2002 from  $198.2  million in fiscal  year 2001.  The  increase  is
primarily  attributed to the  introduction of 22 new products and overall demand
for our consumer products. Gross profit as a percentage of net revenues improved
to 54.8%  in 2002  from  53.7% in 2001.  The  improvement  in gross  margin  was
primarily  due to the  introduction  of new  higher  margin  products,  improved
manufacturing efficiencies on many of the new products introduced throughout the
year, and a reduction of material costs.                                        

     Gross profit for the consumer segment increased $52.0 million, or 39.3%, to
$184.5  million for fiscal 2002 from $132.5 million in fiscal 2001. The increase
is primarily  attributed  to the  introduction  of 18 new consumer  products and
overall  demand for our consumer  products.  Gross profit as a percentage of net
revenues for the consumer segment improved  significantly to 52.6% for 2002 when
compared to 50.3% for 2001.                                                     

     Gross profit for the aviation segment  increased $4.9 million,  or 7.4%, to
$70.5 million for fiscal 2002 from $65.6  million for fiscal 2001.  The increase
in gross profit is primarily due to the increase in revenues associated with the
introduction of four new aviation products,  increased  penetration into the OEM
market, and a return to less restricted  airspace for general aviation aircraft.
Gross profit as a percentage of net revenues decreased slightly to 61.6% in 2002
from 62.1% in 2001.  This  decrease  as a  percentage  of net  revenues  for the
aviation  segment is primarily  attributed  to product mix as we  experienced  a
19.4%  increase in lower margin panel mount unit sales during 2002 when compared
to 2001.                                                                        

Selling, General and Administrative Expenses                                    

     Selling,  general and administrative  expenses  increased $6.7 million,  or
17.4%,  to $45.5  million  (9.8% of net  revenues)  for  fiscal  2002 from $38.7
million  (10.5%  of  net  revenues)  for  fiscal  2001.  Selling,   general  and
administrative  expenses  increased  $6.1  million,  or 21.0%,  in the  consumer
segment  and  increased  $0.6  million, or                                      

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6.7% in the aviation segment. The increase in expense was primarily attributable
to increases in employment  generally across the  organization  (net increase of
146 employees), increased advertising costs (up 13.3%) associated primarily with
new product  releases,  additional  staffing in the customer  call  center,  and
increases in insurance premiums.  Overall,  selling,  general and administrative
expenses  increased at a lower rate than revenues due to strong demand for newly
introduced  and  existing  consumer  products.  Management  expects its selling,
general and  administrative  expenses to increase  approximately  12-15%  during
fiscal 2003 on an absolute dollar basis due to the  anticipated  introduction of
new products for 2003.                                                          

Research and Development Expenses                                               

     Research and  development  expenses  increased $4.0 million,  or 14.2%,  to
$32.2  million  (6.9% of net  revenues)  for fiscal year 2002 from $28.2 million
(7.6% of net revenues) for fiscal year 2001.  Research and development  expenses
increased  $.67  million,  or 3.7%, in the consumer  segment and increased  $3.3
million,  or 33.4%,  in the  aviation  segment.  The  increase  in  expense  was
primarily  attributable to the development and  introduction of 22 new products,
and the addition of 67 new engineers to our staff during fiscal 2002. Management
believes that one of the key strategic initiatives for future growth and success
of the Company is continuous  innovation,  development,  and introduction of new
products.  Management  expects that its research and  development  expenses will
increase approximately 20% to 25% during fiscal 2003 on an absolute dollar basis
due to the anticipated  introduction of new products for fiscal 2003. Management
expects to continue to invest in the  research and  development  of new products
and technology in order to maintain the Company's  competitive  advantage in the
markets in which it competes.                                                   

Other Income (Expense)                                                          

     Other income (expense)  principally  consists of interest income,  interest
expense and foreign currency exchange gains and losses.  Other income for fiscal
year 2002 amounted to $5.3 million compared to other income of $20.7 million for
fiscal  year  2001,  with the  majority  of this  difference  caused by  foreign
currency gains in 2001. Interest income for fiscal 2002 amounted to $6.5 million
compared to $11.2 million for fiscal 2001,  the decrease being  attributable  to
the fall in interest rates,  reducing the returns on the Company's cash and cash
equivalents.  Interest  expense  decreased  to $1.3 million for fiscal 2002 from
$2.2 million for fiscal 2001, due primarily to the reduction of debt and a lower
interest rate environment during fiscal 2002.                                   

     During  fiscal  2002 the  Company's  position  was  neutral  with regard to
foreign  currency  exchange  gains  and  losses,  as  the  U.S.  Dollar  was  at
approximately the same level at the beginning of 2002 relative to the New Taiwan
Dollar (35.17 NTD/USD) as it was at the end of fiscal 2002 (34.90  NTD/USD).  In
fiscal 2001 there was an $11.6 million gain due to the  significantly  increased
strength of the U.S.  Dollar compared to the New Taiwan Dollar during 2001, when
the exchange  rate  increased  to 35.17  NTD/USD at December 29, 2001 from 33.01
NTD/USD at December 30, 2000.                                                   

Income Tax Provision                                                            

     Income tax expense increased by $1.4 million, to $39.9 million,  for fiscal
year 2002 from  $38.6  million  for fiscal  year 2001 due to our higher  taxable
income. The effective tax rate was 21.9% for fiscal 2002 versus 25.4% for fiscal
2001.  The  decrease in tax rate is due  primarily  to  additional  tax benefits
received  from Taiwan as a result of our  continued  capital  investment  in our
manufacturing  facilities there. Management believes that the effective tax rate
for fiscal 2003 will be comparable to fiscal 2002.                              

Net Income                                                                      

     As a result of the above,  net income increased 25.9% to $142.8 million for
fiscal year 2002 compared to $113.4 million for fiscal year 2001.               

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Comparison of Fiscal Years Ended December 29, 2001 and December 30, 2000        

Net Sales                                                                       

     Net sales  increased  $23.4 million,  or 6.8%, to $369.1 million for fiscal
year ended December 29, 2001, from $345.7 million for fiscal year ended December
30, 2000. The increase during fiscal 2001 was primarily due to the  introduction
of 25 new products and overall demand for our consumer products.  Sales from our
consumer  products  accounted for 71.3% of net revenues for fiscal 2001 compared
to 66.6% during  fiscal 2000.  Sales from our aviation  products  accounted  for
28.7% of net  revenues  for fiscal 2001  compared to 33.4%  during  fiscal 2000.
Total  consumer  and  aviation  units  increased  8.8% to 1,331,000 in 2001 from
1,223,000 in 2000                                                               

     Net sales for the consumer  segment  increased $33.2 million,  or 14.4%, to
$263.4 million for fiscal 2001 from $230.2 million for fiscal 2000. The increase
was primarily due to the  introduction  of 22 new consumer  products and overall
demand for our consumer products as total units were up 9.7%.                   

     Net sales for the aviation  segment  decreased  $9.8  million,  or 8.5%, to
$105.8 million for fiscal 2001 from $115.6 million for fiscal 2000. The decrease
for fiscal 2001 was primarily due to declining economic  conditions and the shut
down of U.S.  airspace as a result of the  terrorist  attacks  that  occurred on
September 11, 2001. In addition to the shut down of U.S.  airspace,  the general
aviation   industry  was  further   impacted  by  the  additional   restrictions
implemented by the Federal Aviation  Administration  (FAA) on those flights that
fly utilizing Visual Flight Rules (VFR). The FAA restricted VFR flight inside 30
enhanced Class B (a 20-25 mile radius around the 30 largest  metropolitan  areas
in the  country)  airspace  areas.  The Aircraft  Owners and Pilots  Association
(AOPA) estimated that these restrictions  affected  approximately 41,800 general
aviation  aircraft based at 282 airports inside the 30 enhanced Class B airspace
areas. The AOPA estimates that approximately 90% of all general aviation flights
are conducted VFR, and that only 15% of general  aviation  pilots are current to
fly utilizing  Instrument Flight Rules (IFR).  These  restrictions  impacted our
revenues since many general  aviation  aircraft were grounded and were unable to
fly to  aviation  dealers  to buy  our  products.  As a  result  of the  factors
indicated above, total aviation units sold during fiscal 2001 declined 9.3% when
compared to fiscal 2000.                                                        

Gross Profit                                                                    

     Gross profit increased $14.5 million, or 7.9%, to $198.2 million for fiscal
year 2001 from $183.7  million in fiscal year 2000.  The  increase is  primarily
attributed  to the  introduction  of 25 new products and overall  demand for our
consumer  products.  Gross  profit as a percentage  of net revenues  improved to
53.7% in 2001 from 53.1% in 2000. The  improvement in gross margin was primarily
due to the  introduction of new higher margin products,  improved  manufacturing
efficiencies on many of the new products  introduced  throughout the year, and a
reduction of material costs.                                                    

     Gross profit for the consumer segment increased $17.0 million, or 14.7%, to
$132.5  million for fiscal 2001 from $115.5 million in fiscal 2000. The increase
is primarily  attributed  to the  introduction  of 22 new consumer  products and
overall  demand for our consumer  products.  Gross profit as a percentage of net
revenues for the consumer  segment  remained  relatively  flat at 50.3% for 2001
when compared to 50.2% for 2000.                                                

     Gross profit for the aviation segment  decreased $2.6 million,  or 3.8%, to
$65.6 million for fiscal 2001 from $68.2 million for fiscal 2000. The decline in
gross  profit was  primarily  due to the  decrease in revenues  associated  with
declining economic  conditions and the shut down of U.S. airspace as a result of
the terrorist  attacks that  occurred on September  11, 2001.  Gross profit as a
percentage  of net revenues for the aviation  segment  improved to 62.1% in 2001
from  59.0% in 2000.  This  improvement  as a  percentage  of net  revenues  was
primarily attributed to product mix as we experienced a 13.9% increase in higher
margin panel mount unit sales during 2001 when compared to 2000.                

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Selling, General and Administrative Expenses                                    

     Selling,  general and administrative  expenses  increased $6.0 million,  or
18.5%,  to $38.7  million  (10.5% of net  revenues)  for fiscal  2001 from $32.7
million  (9.4%  of  net  revenues)  for  fiscal  2000.   Selling,   general  and
administrative  expenses  increased  $5.3  million,  or 22.2%,  in the  consumer
segment  and  increased  $0.8  million,  or 8.7% in the  aviation  segment.  The
increase  in expense was  primarily  attributable  to  increases  in  employment
generally  across the  organization  (net increase of 32  employees),  increased
advertising  costs (up 27.6%)  associated with new product  releases,  increased
costs  associated  with  being a public  company,  and  increases  in  insurance
premiums.  Overall,  selling, general and administrative expenses increased at a
higher  rate than  revenues  due to the need to ramp-up  for the  release of new
products.                                                                       

Research and Development Expenses                                               

     Research and  development  expenses  increased $6.4 million,  or 29.4%,  to
$28.2  million  (7.6% of net  revenues)  for fiscal year 2001 from $21.8 million
(6.3% of net revenues) for fiscal year 2000.  Research and development  expenses
increased  $4.0 million,  or 28.1%,  in the consumer  segment and increased $2.4
million,  or 31.9%,  in the  aviation  segment.  The  increase  in  expense  was
primarily  attributable to the development and  introduction of 25 new products,
and the addition of 50 new engineers to our staff during fiscal 2001.           

Other Income (Expense)                                                          

     Other income (expense)  principally  consists of interest income,  interest
expense and foreign currency exchange gains and losses.  Other income for fiscal
year 2001  amounted to $20.7  million  compared to other income of $11.6 million
for fiscal year 2000.  Interest income for fiscal 2001 amounted to $11.2 million
compared to $6.9 million for fiscal 2000, the increase being attributable to the
growth of the Company's cash and cash  equivalents  from  profitable  operations
during  the  period  on which  interest  income  was  earned.  Interest  expense
decreased to $2.2 million for fiscal 2001 from $2.3 million for fiscal 2000, due
primarily to the reduction of debt and a lower interest rate environment  during
fiscal 2001.                                                                    

     We recognized a foreign currency  exchange gain of $11.6 million for fiscal
2001 compared to a gain of $7.0 million for fiscal 2000.  The $11.6 million gain
was due to the significantly  increased  strength of the U.S. Dollar compared to
the New Taiwan  Dollar during 2001,  when the exchange  rate  increased to 35.17
NTD/USD at December 29, 2001 from 33.01  NTD/USD at December 30, 2000.  The $7.0
million gain during 2000 was due to the significantly  increased strength of the
U.S.  Dollar  compared to the New Taiwan Dollar  during 2000,  when the exchange
rate  increased  to 33.01  NTD/USD at December  30,  2000 from 31.30  NTD/USD at
December 25, 1999.                                                              

Income Tax Provision                                                            

     Income tax expense increased by $3.3 million, to $38.6 million,  for fiscal
year 2001 from  $35.3  million  for fiscal  year 2000 due to our higher  taxable
income. The effective tax rate was 25.4% for fiscal 2001 versus 25.0% for fiscal
2000. The increase is  attributable to the source of taxable income between each
of our subsidiaries changing slightly during 2001.                              

Net Income                                                                      

     As a result of the above,  net income  increased 7.4% to $113.4 million for
fiscal year 2001 compared to $105.7 million for fiscal year 2000.               

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Liquidity and Capital Resources                                                 

     Net cash generated by operations was $175.4 million,  $130.0  million,  and
$83.5 million for fiscal years 2002,  2001, and 2000,  respectively.  We operate
with a strong customer driven approach and therefore carry sufficient  inventory
to meet customer  demand.  Because we desire to respond quickly to our customers
and minimize order  fulfillment  time,  our inventory  levels are generally high
enough to meet most demand. We also attempt to carry sufficient inventory levels
on key components so that potential supplier shortages have as minimal an impact
as  possible  on  our  ability  to  deliver  our  finished  products.  We do not
anticipate that our inventory management  techniques will have a negative impact
on our financial  results in the future. We were able to reduce inventory levels
during  fiscal year 2002 by $3.6 million when  compared to fiscal year end 2001,
without impairing our ability to meet customer demand,  by effectively  managing
the  introduction  of 22 new products  during the year. We expect that inventory
levels may increase during fiscal 2003 due to anticipated increase in sales.    

     During fiscal 2002, our capital expenditures  totaled $12.4 million,  which
was $2.5  million less than during  2001.  In fiscal 2001 and 2000,  our capital
expenditures   totaled   approximately   $14.9   million   and  $24.8   million,
respectively.  The expenditures in fiscal 2002 were primarily related to general
corporate  purposes ($9.8 million) and the addition of surface-mount  production
equipment  in both  the  Olathe,  Kansas  and  Shijr,  Taiwan  facilities  ($2.6
million).  The  expenditures  in fiscal  2001 were  incurred  primarily  for the
completed  expansion  of  our  Olathe,  Kansas  facility  ($3.2  million),   the
construction  of our new flight test and  certification  facility ($1.6 million)
located  at the New  Century  Airport  near  Olathe,  Kansas,  and  for  general
corporate  purposes.  The expenditures in fiscal 2000 were incurred primarily to
increase our manufacturing  capacity both in the United States and in Taiwan. We
financed  these capital  expenditures  through net operating  cash flow and debt
from outside financial institutions.                                            

     We expect our future capital  requirements  to include  construction  costs
related to our  recently-announced  facilities expansion in Olathe,  Kansas, and
purchases of production  machinery and equipment to expand  capacity.  A portion
will  also be used for  conversion  of  available  space in our  Olathe,  Kansas
building for  manufacturing  use and expansion of our  manufacturing  operations
within our facility in Shijr,  Taiwan.  We may use a portion of the net proceeds
from our  December  2000 Initial  Public  Offering  ("IPO") to acquire  targeted
strategic businesses, and we continue to look for these opportunities.          

     In addition to capital expenditures, cash flow used in investing activities
principally  relates to the purchase of fixed income securities  associated with
the  investment  of our on-hand cash  balances and  approximately  $13.5 million
related to the purchase of licenses,  of which $11.5 million consists of prepaid
royalties  under  our  license  agreement  with  PalmSource,  Inc.  for the Palm
Operating  System. It is management's goal to invest the on-hand cash consistent
with the Company's  investment  policy,  which has been approved by the Board of
Directors.  The  investment  policy's  primary  purpose is to preserve  capital,
maintain an  acceptable  degree of  liquidity,  and  maximize  yield  within the
constraint of maximum  safety.  The Company's  average return on its investments
during fiscal year 2002 was approximately 1.6%.                                 

     Cash flow used in financing activities during 2002 relates primarily to the
reduction of our debt. The Company  retired  approximately  $12.2 million of its
long-term  debt during fiscal 2002,  consisting  in good part of an  outstanding
issue of industrial revenue bonds. The employee stock purchase program and stock
option exercises were sources of cash in 2002. The Company retired approximately
$14.2 million of its long-term debt during fiscal 2001. The Company  repurchased
595,200 shares of its common stock under its stock  repurchase  program that was
approved by the Board of Directors on September 24, 2001 and expired on December
31, 2002.  The cash flow source from  financing  activities  during 2000 was due
primarily to the issuance of debt and IPO proceeds less dividend distributions. 

     We  currently   use  cash  flow  from   operations   to  fund  our  capital
expenditures,  to repay debt and to support our working capital requirements. We
expect  that  future  cash   requirements   will   principally  be  for  capital
expenditures, repayment of indebtedness, and working capital requirements.      

     Cash dividends paid to stockholders  were $0.0 million,  $0.0 million,  and
$29.0 million during fiscal years 2002, 2001 and 2000, respectively. Included in
cash dividends for fiscal 2000 was a special one-time  dividend of $17.4 million
that was paid in order to provide funds to shareholders to pay withholding taxes
and stock transfer taxes related to the reorganization of Garmin Corporation.   

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     We believe that our existing  cash  balances and cash flow from  operations
will be sufficient to meet our projected capital  expenditures,  working capital
and other cash requirements at least through the end of fiscal 2003.            

Contractual Obligations and Commercial Commitments                              

     On March 23, 2000,  Garmin  International,  Inc.  completed a $20.0 million
20-year  Taxable  Industrial  Revenue Bond  issuance  (the "2000 Bonds") for the
expansion of its Olathe,  Kansas  facility.  At December  28, 2002,  outstanding
principal under the 2000 Bonds totaled $20.0 million. Interest on the 2000 Bonds
is payable  monthly at a variable  interest  rate (1.50% at December 28,  2002),
which is  adjusted  weekly  to the  current  market  rate as  determined  by the
remarketing  agent of the 2000 Bonds with  principal  due upon maturity on April
15, 2020.                                                                       

     The 2000 Bonds are  secured  by an  irrevocable  letter of credit  totaling
$20.3  million with  facility  fees of 0.75%.  This  renewable  letter of credit
initially expires on September 20, 2004. The bank has required a sinking fund be
established  with  principal  payments on  long-term  debt  beginning in 2004 of
$4,002 with semiannual payments of $667 thereafter.                             

     On January 1, 1995,  Garmin  International,  Inc.  completed a $9.5 million
30-year Tax-Exempt  Industrial Revenue Bond issuance for the construction of its
new corporate  headquarters  located in Olathe,  Kansas.  Upon completion of the
project in 1996,  Garmin  International  retired  bonds  totaling  $0.2 million.
During May of fiscal 2002, the remainder of the  outstanding  bonds were retired
by Garmin International, Inc. for a total of $9.4 million.                      

     The reimbursement agreements entered into by Garmin International,  Inc. in
connection  with the 2000 Bonds contain  restrictive  covenants,  which include,
among other things,  financial  covenants  requiring minimum cash flow leverage,
maximum  capitalization,  minimum tangible net worth, and other  affirmative and
negative covenants. We do not expect these limitations to have a material effect
on our  business  or  results  of  operations.  We are in  compliance  with  all
covenants contained in the reimbursement agreements.                            

     During  1999,  Garmin  Corporation  borrowed  $18.0  million to finance the
purchase  of  land  and a new  manufacturing  facility  in  Shijr,  Taiwan.  The
outstanding  balance of $2.8 million at December  29, 2001,  was paid in full in
January 2002.                                                                   

     We utilize  interest rate swap agreements to manage interest rate exposure.
The principal  objective of such financial  derivative  contracts is to moderate
the effect of fluctuations in interest rates. We, as a matter of policy,  do not
speculate in financial  markets and  therefore do not hold these  contracts  for
trading  purposes.  We utilize what are considered simple  instruments,  such as
non-leveraged interest rate swaps, to accomplish our objectives.                

     The  Company  has the  option at any time to retire a portion or all of its
long-term  debt. The Company  believes the funds necessary to fulfill these debt
obligations and  commitments  will be generated in the course of normal business
operations.                                                                     

Off-Balance Sheet Arrangements                                                  

We do not have any off-balance sheet arrangements.                    

Recent Accounting Pronouncements                                                

     In June 2002, the Financial  Accounting  Standards  Board  ("FASB")  issued
Statement of Financial  Accounting  Standards  ("SFAS") No. 146,  Accounting for
Costs  Associated with Exit or Disposal  Activities,  which addresses  financial
accounting and reporting for costs  associated with exit or disposal  activities
and  nullifies  Emerging  Issues Task Force (EITF)  Issue No.  94-3,  "Liability
Recognition for Certain Employee Termination Benefits and Other Costs to Exit an
Activity (including Certain Costs Incurred in a Restructuring)."  The provisions
of this statement are effective for exit or disposal activities  initiated after
December  31,  2002.  The  Company  does not expect  that the  adoption  of this
statement will have a significant impact on the Company's  financial position as
no exit or disposal activities are currently planned.                           

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     In December 2002, the FASB issued SFAS No. 148,  Accounting for Stock-Based
Compensation -- Transition and Disclosure.  This statement requires all entities
with  stock-based  employee  compensation  arrangements  to  provide  additional
disclosures in their summary of significant  accounting policies note. Since the
Company uses the intrinsic value method of Accounting  Principles  Board ("APB")
Opinion  No.  25,  Accounting  for Stock  Issued to  Employees,  the  accounting
policies  note will include a tabular  presentation  of pro forma net income and
earnings  per share  using the fair value  method  prescribed  by SFAS No.  123,
Accounting for Stock-Based  Compensation.  Also,  SFAS No. 148 permits  entities
changing to the fair value method of accounting for employee stock  compensation
to choose from one of three transition  methods -- the prospective  method,  the
modified  prospective method, or the retroactive  restatement  method.  Finally,
SFAS  No.  148  will  require  the  Company  to make  interim-period  pro  forma
disclosures  if  stock-based  compensation  is accounted for under the intrinsic
value  method  in  any  period   presented.   The  expanded  annual   disclosure
requirements  and the  transition  provisions  are  effective  for the Company's
fiscal  year 2002.  The new  interim  period  disclosures  are  required  in the
Company's  financial  statements  for  interim  periods  beginning  in the first
quarter of fiscal 2003. This statement has not had and is not expected to have a
material impact on the Company's results of operations or financial condition.  

     In  October  2001,  the FASB  issued  SFAS  No.  144,  "Accounting  for the
Impairment  or Disposal of  Long-Lived  Assets,"  which is effective  for fiscal
years beginning  after December 15, 2001. This new standard  supersedes SFAS No.
121,  "Accounting  for the  Impairment of Long-Lived  Assets and for  Long-Lived
Assets to Be Disposed  Of,"  providing  one  accounting  model for the review of
asset  impairment.  SFAS No. 144 retains much of the recognition and measurement
provisions  of SFAS No.  121,  but  removes  goodwill  from its  scope.  It also
requires long-lived assets to be disposed of other than by sale to be considered
as held and  used  until  disposed  of,  requiring  the  depreciable  life to be
adjusted as an accounting change.  Criteria to classify  long-lived assets to be
disposed of by sale has changed from SFAS No. 121,  but these costs  continue to
be  reported  at the lower of their  carrying  amount or fair value less cost to
sell, and will cease to be depreciated.                                         

     SFAS No. 144 also  supersedes  the section of the APB Opinion No. 30, which
prescribes  reporting  for the effects of a disposal of a segment of a business.
SFAS No. 144 retains  the basic  presentation  provisions  of the  opinion,  but
requires  losses on a disposal or  discontinued  operation to be  recognized  as
incurred. It also broadens the definition of a discontinued operation to include
a component of an entity.  The adoption of this statement has not had and is not
expected  to have a material  impact on our  financial  condition  or results of
operations.                                                                     

     In July  2001,  the  FASB  issued  SFAS  No.  143,  "Accounting  for  Asset
Retirement   Obligations."  The  objective  of  this  statement  is  to  provide
accounting  guidance for legal  obligations  associated  with the  retirement of
long-lived  assets by  requiring  the fair  value of a  liability  for the asset
retirement  obligation  to be  recognized in the period in which it is incurred.
When the liability is initially  recognized,  the asset  retirement costs should
also be capitalized by increasing the carrying amount of the related  long-lived
asset.  The  liability is then accreted to its present value each period and the
capitalized  costs are depreciated over the useful life of the associated asset.
This statement is effective for fiscal years  beginning after June 15, 2002, and
is not expected to have a material impact on our financial statements.          

     In June 2001, the FASB issued SFAS No. 141,  "Business  Combinations,"  and
SFAS No. 142,  "Goodwill and Other  Intangible  Assets." SFAS No. 141 supercedes
APB Opinion No. 16, "Business  Combinations,"  and SFAS No. 28,  "Accounting for
Pre-acquisition Contingencies of Purchased Enterprises." This statement requires
accounting for all business  combinations using the purchase method, and changes
the  criteria  for  recognizing  intangible  assets  apart from  goodwill.  This
statement is effective for all business  combinations  initiated  after June 30,
2001.  SFAS No. 142  supercedes  APB  Opinion  No. 17,  "Intangible  Assets" and
addresses how purchased  intangibles  should be accounted for upon  acquisition.
The statement also addresses how goodwill and other intangible  assets should be
accounted  for after  they  have  been  initially  recognized  in the  financial
statements.  All intangibles are subject to periodic  impairment testing and are
adjusted  down to fair value.  This  statement  is  effective  for fiscal  years
beginning  after  December  15,  2001,  and its  adoption has not had and is not
expected  to have a material  impact on our  financial  condition  or results of
operations.                                                                     

     In June 1998 and June 1999, the FASB issued SFAS No. 133,  "Accounting  for
Derivative Instruments and Hedging Activities" and SFAS No. 137, "Accounting for
Derivative Instruments and Hedging Activities--Deferral of the Effective Date of
FASB  Statement  No.  133".  These  statements   require   companies  to  record
derivatives  on the  balance  sheet as assets or  liabilities,  measured at fair
value. Gains or losses resulting from changes in the values of those derivatives
would be accounted  for  depending on the use of the  derivative  and whether it
qualifies for hedge                                                             

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accounting.  SFAS No. 133 was effective for our fiscal year ending  December 29,
2001.  The  adoption  of SFAS  No.  133 has not  had a  material  impact  on our
financial condition or results of operations.                                   

Company-Specific Trends and Risks                                               

     You should  carefully  consider  the risks  described  below  regarding  an
investment in our common shares. The risks described below are not the only ones
facing our company. Additional risks and uncertainties not presently known to us
or that we  currently  believe to be  immaterial  may also  impair our  business
operations.  If  any of the  following  risks  occur,  our  business,  financial
condition or operating results could be materially adversely affected.          

Risks Related to the Company                                                    

     Our Global Positioning System products depend upon satellites maintained by
the United  States  Department  of  Defense.  If a  significant  number of these
satellites become inoperable, unavailable or are not replaced or if the policies
of the United States  government  for the use of the Global  Positioning  System
without charge are changed or if there is interference  with Global  Positioning
System signals, our business will suffer.                                       

     The  Global  Positioning   System  is  a  satellite-based   navigation  and
positioning  system  consisting of a constellation of orbiting  satellites.  The
satellites and their ground  control and monitoring  stations are maintained and
operated by the United States  Department of Defense.  The Department of Defense
does not  currently  charge  users for access to the  satellite  signals.  These
satellites  and their  ground  support  systems are complex  electronic  systems
subject to  electronic  and  mechanical  failures  and  possible  sabotage.  The
satellites were  originally  designed to have lives of 7.5 years and are subject
to damage by the hostile space  environment in which they operate.  However,  of
the current deployment of satellites in place, some have been operating for more
than 11 years.                                                                  

     If  a  significant   number  of  satellites  were  to  become   inoperable,
unavailable  or are not  replaced,  it would  impair the current  utility of our
Global  Positioning  System  products  and the growth of current and  additional
market  opportunities.  In  addition,  there can be no  assurance  that the U.S.
government  will remain  committed to the  operation and  maintenance  of Global
Positioning  System  satellites over a long period,  or that the policies of the
U.S.  government  that  provide  for the use of the  Global  Positioning  System
without charge and without accuracy  degradation will remain unchanged.  Because
of the increasing  commercial  applications  of the Global  Positioning  System,
other U.S.  government agencies may become involved in the administration or the
regulation of the use of Global Positioning System signals.                     

     European  governments  have  expressed  interest in building an independent
satellite  navigation  system  known  as  Galileo.   Depending  on  the  as  yet
undetermined  design and operation of this system,  it is possible that it could
cause interference with Global Positioning System signals.                      

     Any of the foregoing  factors could affect the willingness of buyers of our
products to select Global Positioning  System-based products instead of products
based on competing technologies.                                                

A shut down of U.S. airspace would harm our business.                           

     On September  11,  2001,  terrorists  hijacked  and crashed four  passenger
aircraft  operated by commercial  air carriers,  resulting in major loss of life
and   property.   Following  the  terrorist   attacks,   the  Federal   Aviation
Administration ("FAA") ordered all aircraft operating in the U.S. to be grounded
for several  days. In addition to this shut down of U.S.  airspace,  the general
aviation   industry  was  further   impacted  by  the  additional   restrictions
implemented  by the FAA on those flights that fly utilizing  Visual Flight Rules
(VFR).  The FAA  restricted  VFR flight inside 30 enhanced Class B (a 20-25 mile
radius around the 30 largest  metropolitan areas in the USA) airspace areas. The
Aircraft Owners and Pilots  Association (AOPA) estimated that these restrictions
affected  approximately  41,800 general aviation  aircraft based at 282 airports
inside  the 30  enhanced  Class  B  airspace  areas.  The  AOPA  estimates  that
approximately  90% of all general  aviation  flights are conducted VFR, and that
only 15% of general  aviation  pilots are  current to fly  utilizing  Instrument
Flight Rules  (IFR).  These  restrictions  impacted our revenues in             

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the aviation segment since many general aviation aircraft were grounded and this
caused potential customers to forgo or defer purchasing our aviation products.  

     The shut down of U.S. airspace following the September 11, 2001 also caused
delays in the shipment of our products  manufactured in our Taiwan manufacturing
facility to our  distribution  facility  in Olathe,  Kansas,  thereby  adversely
affecting  our  ability to supply new and  existing  products to our dealers and
distributors.                                                                   

     Any future shut down of U.S.  airspace or  imposition  of  restrictions  on
general  aviation  could  have a material  adverse  effect on our  business  and
financial results.                                                              

Any reallocation of radio frequency  spectrum could cause  interference with the
reception of Global Positioning System signals. This interference could harm our
business.                                                                       

     Our Global  Positioning  System  technology  is dependent on the use of the
Standard  Positioning  Service (SPS)  provided by the U.S.  Government's  Global
Positioning System  satellites.  The Global Positioning System operates in radio
frequency  bands that are  globally  allocated  for radio  navigation  satellite
services.   The  assignment  of  spectrum  is  controlled  by  an  international
organization known as the International  Telecommunications  Union ("ITU").  The
Federal  Communications  Commission ("FCC") is responsible for the assignment of
spectrum for  non-government  use in the United  States in  accordance  with ITU
regulations.  Any ITU or FCC reallocation of radio frequency spectrum, including
frequency band  segmentation  or sharing of spectrum,  could cause  interference
with the reception of Global  Positioning  System signals and may materially and
adversely  affect the utility and  reliability of our products,  which would, in
turn,  have a material  adverse  effect on our operating  results.  In addition,
emissions  from  mobile  satellite  service  and other  equipment  operating  in
adjacent  frequency  bands or inband may  materially  and  adversely  affect the
utility  and  reliability  of our  products,  which  could  result in a material
adverse effect on our operating results.                                        

Ultra-Wideband  radio  devices  could cause  interference  with the reception of
Global  Positioning  System  signals if the FCC were to change  its rules.  This
interference could harm our business.                                           

     On February 13, 2003,  the FCC adopted a Memorandum  Opinion and Order (the
"Order")  that  allows a limited  number of  Ultra-Wideband  ("UWB")  devices to
operate on a licensed basis in the frequency band used by the Global Positioning
System. The Order limits these devices to use by qualified  emergency  officials
at emission  limits  that  protect the Global  Positioning  System.  The FCC has
stated  that it plans to review the rules of  operation  for UWB  devices  again
within a twelve to eighteen  month period  following the date of adoption of the
Order.  If the FCC were to issue a further  rule  authorizing  operation  of UWB
devices in the frequency  band used by the Global  Positioning  System at higher
power  levels  than  those  set  out  in  the  Order  or  otherwise  change  the
definitional  or  operational  characteristics  of permitted  UWB devices,  such
devices might cause interference with the reception of Global Positioning System
signals.  Such interference  could reduce demand for Global  Positioning  System
products  in the  future.  Any  resulting  change in market  demand  for  Global
Positioning  System  products  could  have  a  material  adverse  effect  on our
financial results.                                                              

If we are not successful in the continued  development,  introduction  or timely
manufacture of new products, demand for our products could decrease.            

     We expect that a significant portion of our future revenue will continue to
be derived from sales of newly introduced products.  The market for our products
is characterized by rapidly changing technology, evolving industry standards and
changes in  customer  needs.  If we fail to modify or improve  our  products  in
response to changes in technology,  industry  standards or customer  needs,  our
products could rapidly become less competitive or obsolete.  We must continue to
make significant investments in research and development in order to continue to
develop new products,  enhance existing  products and achieve market  acceptance
for such products.  However,  there can be no assurance that  development  stage
products  will  be  successfully  completed  or,  if  developed,   will  achieve
significant customer acceptance.                                                

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        If we are unable to successfully develop and introduce competitive new
products, and enhance our existing products, our future results of operations   
would be adversely affected. Our pursuit of necessary technology may require    
substantial time and expense. We may need to license new technologies to respond
to technological change. These licenses may not be available to us on terms that
we can accept. We may not succeed in adapting our products to new technologies  
as they emerge. Development and manufacturing schedules for technology products 
are difficult to predict, and there can be no assurance that we will achieve    
timely initial customer shipments of new products. The timely availability of   
these products in volume and their acceptance by customers are important to our 
future success. We have previously experienced delays in shipping certain of our
products and any future delays, whether due to manufacturing delays, lack of    
market acceptance, delays in regulatory approval, or otherwise, could have a    
material adverse effect on our results of operations.                           

If we do not correctly anticipate demand for our products, we may not be able to
secure sufficient quantities or cost-effective  production of our products or we
could have costly excess production or inventories.                             

     Historically,  we have  experienced  steady  increases  in  demand  for our
products  (although  we did  experience  a decline  in demand  for our  aviation
products in 2001 due to declining economic  conditions and the shut down of U.S.
airspace as a result of the  terrorist  attacks that  occurred on September  11,
2001)  and we have  generally  been  able to  increase  production  to meet that
demand. However, the demand for our products depends on many factors and will be
difficult to forecast.  We expect that it will become more difficult to forecast
demand as we introduce and support  multiple  products and as competition in the
market for our products intensifies.  Significant unanticipated  fluctuations in
demand could cause the following problems in our operations:                    

         o If demand increases beyond what we forecast, we would have to rapidly
  increase production. We would depend on suppliers to provide
       additional volumes of components and those suppliers might not be
           able to increase production rapidly enough to meet unexpected demand.

     o Rapid increases in production levels to meet unanticipated demand
  could result in higher costs for manufacturing and supply of
       components and other expenses. These higher costs could lower our
  profit margins. Further, if production is increased rapidly,
   manufacturing quality could decline, which may also lower our
margins.                                                  

o If forecasted demand does not develop, we could have excess 
         production resulting in higher inventories of finished products and
           components, which would use cash and could lead to write-offs of some
          or all of the excess inventories. Lower than forecasted demand could
           also result in excess manufacturing capacity at our facilities, which
could result in lower margins.                            

We may become subject to significant product liability costs.                   

     If our aviation products malfunction or contain errors or defects, airplane
collisions or crashes could occur resulting in property damage,  personal injury
or death.  Malfunctions or errors or defects in our marine navigational products
could cause boats to run aground or cause  other  wreckage,  personal  injury or
death.  If any of  these  events  occurs,  we could be  subject  to  significant
liability for personal injury and property damage. We maintain insurance against
accident-related  risks  involving  our  products.  However,  there  can  be  no
assurance that such  insurance  would be sufficient to cover the cost of damages
to others or that such insurance  will continue to be available at  commercially
reasonable  rates.  If we are unable to maintain  sufficient  insurance to cover
product liability costs, our business could be harmed.                          

We  depend on our  suppliers,  some of which are the sole  source  for  specific
components,  and our production would be seriously harmed if these suppliers are
not able to meet our demand and alternative sources are not available, or if the
costs of components rise.                                                       

     We are dependent on third party  suppliers for various  components  used in
our current  products.  Some of the components  that we procure from third party
suppliers include semiconductors and  electroluminescent  panels, liquid crystal
displays,  memory chips and microprocessors.  The cost, quality and availability
of  components  are                                                             

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essential to the successful production and sale of our products. Some components
come  from  our  sole  source   suppliers.   International   Business   Machines
Corporation, RF Micro Devices, Inc. NEC Electronics,  Inc. and Texas Instruments
Taiwan   Ltd.   are  each   the  sole   source   supplier   to  us  of   certain
application-specific  integrated circuits  incorporating our proprietary designs
which they manufacture for us. Intel  Corporation is the sole source supplier of
certain  microprocessors used in some of our products.  Analog Devices,  Inc. is
the sole source  supplier of a  microprocessor  used in our NavTalk GSM and iQue
3600 products.  Motorola,  Inc. is the sole source supplier of a  microprocessor
used  in our  iQue  3600  product.  Alternative  sources  may  not be  currently
available for these sole source components.                                     

     In  the  past,  we  have  experienced  shortages,   particularly  involving
components  that are also used in cellular  phones.  In  addition,  if there are
shortages in supply of  components,  the costs of such  components  may rise. If
suppliers are unable to meet our demand for  components on a timely basis and if
we are unable to obtain an alternative source or if the price of the alternative
source is  prohibitive,  or if the costs of  components  rise,  our  ability  to
maintain timely and cost-effective production of our products would be seriously
harmed.                                                                         

     We license mapping data for use in our products from various sources. There
are only a limited  number of suppliers  of mapping  data for each  geographical
region. If we are unable to continue  licensing such mapping data and are unable
to obtain an alternative  source,  or if the price of the alternative  source is
prohibitive, our ability to supply mapping data for use in our products would be
seriously harmed.                                                               

We rely on  independent  dealers  and  distributors  to sell our  products,  and
disruption to these channels would harm our business.                           

     Because we sell a majority  of our  products  to  independent  dealers  and
distributors,  we are subject to many risks,  including  risks  related to their
inventory  levels and support for our products.  In particular,  our dealers and
distributors  maintain  significant levels of our products in their inventories.
If dealers and  distributors  attempt to reduce  their levels of inventory or if
they do not maintain  sufficient levels to meet customer demand, our sales could
be negatively impacted.                                                         

     Our dealers and distributors also sell products offered by our competitors.
If our  competitors  offer our dealers and  distributors  more favorable  terms,
those  dealers  and  distributors  may  de-emphasize  or  decline  to carry  our
products.  In the future,  we may not be able to retain or attract a  sufficient
number of  qualified  dealers  and  distributors.  If we are unable to  maintain
successful  relationships  with  dealers  and  distributors  or  to  expand  our
distribution channels, our business will suffer.                                

If we fail to manage our growth and expansion effectively, we may not be able to
successfully manage our business.                                               

     Our ability to  successfully  offer our products and implement our business
plan in a rapidly evolving market requires an effective  planning and management
process.  We continue to increase the scope of our operations  domestically  and
internationally and have grown our shipments and headcount  substantially.  This
growth has placed, and our anticipated growth in future operations will continue
to place, a significant strain on our management systems and resources.         

Our  business  may  suffer  if we are not  able to hire  and  retain  sufficient
qualified personnel or if we lose our key personnel.                            

     Our future success depends partly on the continued  contribution of our key
executive,  engineering,  sales,  marketing,  manufacturing  and  administrative
personnel.  We currently do not have  employment  agreements with any of our key
executive  officers.  We do not have key man  life  insurance  on any of our key
executive  officers and do not currently  intend to obtain such  insurance.  The
loss of the  services  of any of our  senior  level  management,  or  other  key
employees,  could  harm our  business.  Recruiting  and  retaining  the  skilled
personnel  we require to maintain  our market  position  may be  difficult.  For
example,  in recent  years there has been a  nationwide  shortage  of  qualified
electrical  engineers and software  engineers who are necessary for us to design
and develop new products                                                        

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and therefore,  it has been challenging to recruit such personnel. If we fail to
hire and retain qualified  employees,  we may not be able to maintain and expand
our business.                                                                   

Our sales and gross margins for our products may fluctuate or erode.            

     Our sales and gross margins for our products may  fluctuate  from period to
period due to a number of factors,  including product mix,  competition and unit
volumes. In particular, the average selling prices of a specific product tend to
decrease over that product's life. To offset such  decreases,  we intend to rely
primarily on obtaining yield  improvements and corresponding  cost reductions in
the  manufacture  of existing  products and on  introducing  new  products  that
incorporate  advanced  features  and  therefore  can be sold at  higher  average
selling  prices.  However,  there  can be no  assurance  that we will be able to
obtain any such yield  improvements or cost reductions or introduce any such new
products in the future.  To the extent that such cost reductions and new product
introductions do not occur in a timely manner or our customers'  products do not
achieve  market  acceptance,  our business,  financial  condition and results of
operations could be materially  adversely affected.  As we introduce new product
lines that serve cellular  handset,  personal  digital  assistant,  Family Radio
Service  and  original  equipment  manufacturer   automotive  and  sensor  board
applications,  we may  experience  a decline in our overall  gross  margins from
sales of these potentially high volume but low margin product lines.            

Our quarterly operating results are subject to fluctuations and seasonality.    

     Our  operating  results  are  difficult  to predict.  Our future  quarterly
operating results may fluctuate significantly.  If this occurs, the price of our
stock would likely decline. As we expand our operations, our operating expenses,
particularly  our sales,  marketing  and research  and  development  costs,  may
increase.  If revenues decrease and we are unable to reduce those costs rapidly,
our operating results would be negatively affected.                             

     Historically,  our revenues have usually been weaker in the first and third
quarters of each fiscal  year and have,  from time to time,  been lower than the
preceding quarter. Our devices are highly consumer-oriented, and consumer buying
is  traditionally  lower in these  quarters.  Sales of certain  of our  consumer
products  tend to be  higher  in our  second  fiscal  quarter  due to  increased
consumer  spending for such products during the recreational  marine and fishing
season.  Sales of certain of our consumer products also tend to be higher in our
fourth fiscal quarter due to increased  consumer spending patterns on electronic
devices  during the  holiday  season.  In  addition,  we attempt to time our new
product  releases to coincide with relatively  higher  consumer  spending in the
second  and  fourth  fiscal  quarters,   which  contributes  to  these  seasonal
variations.                                                                     

Because our reporting currency is in U.S. Dollars and the functional currency of
one of our primary  operating  subsidiaries is in New Taiwan  Dollars,  exchange
rate fluctuations impact the financial  statements of this operating  subsidiary
and our consolidated financial statements.                                      

     Foreign  exchange  effects  on our  financial  statements  can be  material
because our reporting currency is in U.S. Dollars while the functional  currency
of Garmin  Corporation,  one of our  operating  subsidiaries,  is in New  Taiwan
Dollars.  We are exposed to foreign exchange risks related to recurring  foreign
currency  payments,  principally in U.S. Dollars.  In addition,  fluctuations in
exchange  rates  between the U.S.  Dollar and the New Taiwan  Dollar may have an
adverse  impact on the  financial  statements of Garmin  Corporation,  and, as a
consequence,   upon  consolidation  have  an  indirect  adverse  effect  on  our
consolidated financial statements.                                              

If we are unable to compete  effectively with existing or new  competitors,  our
resulting loss of competitive  position could result in price reductions,  fewer
customer orders, reduced margins and loss of market share.                      

     The  markets  for  our  products  are  highly  competitive  and  we  expect
competition  to increase in the future.  We plan to enter the  cellular  handset
market and the portable digital  assistant market and will be competing  against
Telefon AB LM Ericsson,  Motorola,  Inc., Nokia Oy, Palm, Inc., Sony Corporation
and Hewlett-Packard Company with certain products. These competitors, as well as
some of our existing  competitors  or potential  competitors,  such as Honeywell
International,  Inc. and UPS Aviation  Technologies,  have significantly greater
financial,  technical and                                                       

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marketing  resources than we do. These  competitors  may be able to respond more
rapidly to new or emerging  technologies  or changes in  customer  requirements.
They may also be able to devote greater resources to the development,  promotion
and  sale of  their  products.  Increased  competition  could  result  in  price
reductions, fewer customer orders, reduced margins and loss of market share. Our
failure to compete  successfully  against  current or future  competitors  could
seriously harm our business, financial condition and results of operations.     

Our intellectual  property rights are important to our operations,  and we could
suffer  loss if they  infringe  upon  other's  rights or are  infringed  upon by
others.                                                                         

     We rely on a  combination  of  patents,  copyrights,  trademarks  and trade
secrets,  confidentiality provisions and licensing arrangements to establish and
protect  our  proprietary  rights.  To this end,  we hold  rights to a number of
patents and registered  trademarks and regularly file applications to attempt to
protect  our  rights in new  technology  and  trademarks.  However,  there is no
guarantee that our patent  applications will become issued patents,  or that our
trademark  applications will become  registered  trademarks.  Moreover,  even if
approved, our patents or trademarks may thereafter be successfully challenged by
others or otherwise  become  invalidated for a variety of reasons.  In addition,
the only  patents  we have  obtained  are U.S.  patents.  Thus,  any  patents or
trademarks  we  currently  have  or may  later  acquire  may  not  provide  us a
significant competitive advantage.                                              

     Third parties may claim that we are infringing their intellectual  property
rights.  Such claims  could have a serious  adverse  effect on our  business and
financial  condition.   Litigation  concerning  patents  or  other  intellectual
property  can be  costly  and time  consuming.  We may seek  licenses  from such
parties,  but they  could  refuse to grant us a license  or demand  commercially
unreasonable  terms.  We might  not  have  sufficient  resources  to pay for the
licenses.  Such  infringement  claims  could also cause us to incur  substantial
liabilities and to suspend or permanently cease the use of critical technologies
or processes or the production or sale of major products.                       

Failure to obtain  required  certifications  of our  products on a timely  basis
could harm our business.                                                        

     We have certain  products,  especially  in our aviation  segment,  that are
subject to governmental and similar  certifications before they can be sold. For
example,  Federal Aviation  Administration ("FAA") certification is required for
all of our  aviation  products  that  are  intended  for  installation  in  type
certificated  aircraft.  To the extent that it is required,  certification is an
expensive  and time  consuming  process  that  requires  significant  focus  and
resources.  An  inability  to obtain,  or  excessive  delay in  obtaining,  such
certifications  could have an adverse  effect on our  ability to  introduce  new
products and, therefore,  our operating results.  In addition,  we cannot assure
you  that  our   certified   products   will  not  be   decertified.   Any  such
decertification could have an adverse effect on our operating results.          

Our business is subject to economic,  political and other risks  associated with
international sales and operations.                                             

     Our  business  is  subject  to  risks   associated   with  doing   business
internationally.  We  estimate  that  approximately  27% of our net sales in the
fiscal  year  ended   December  28,  2002   represented   products   shipped  to
international destinations. Accordingly, our future results could be harmed by a
variety of international factors, including:                                    

o changes in foreign currency exchange rates;                 

     o changes in a specific country's or region's political or economic
conditions, particularly in emerging markets;             

o trade protection measures and import or export licensing    
requirements;                                             

o potentially negative consequences from changes in tax laws; 

         o difficulty in managing widespread sales and manufacturing operations;
and                                                       

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o less effective protection of intellectual property.         

We may experience  unique economic and political risks associated with companies
that operate in Taiwan.                                                         

     Relations  between Taiwan and the People's Republic of China, also referred
to as the PRC, and other factors affecting the political or economic  conditions
of Taiwan in the future  could  affect our business and the market price and the
liquidity  of our  shares.  Our  principal  manufacturing  facilities  where  we
manufacture all of our products, except our panel-mounted aviation products, are
located in Taiwan.                                                              

     Taiwan  has a  unique  international  political  status.  The  PRC  asserts
sovereignty over all of China,  including Taiwan,  certain other islands and all
of mainland  China.  The PRC government does not recognize the legitimacy of the
Taiwan  government.  Although  significant  economic and cultural relations have
been  established  during  recent  years  between  Taiwan  and the PRC,  the PRC
government  has  indicated  that it may use military  force to gain control over
Taiwan in certain  circumstances,  such as the  declaration of  independence  by
Taiwan. Relations between Taiwan and the PRC have on occasion adversely affected
the  market  value of  Taiwanese  companies  and  could  negatively  affect  our
operations in Taiwan in the future.                                             

There is uncertainty as to our shareholders'  ability to enforce certain foreign
civil liabilities in the Cayman Islands and Taiwan.                             

     We are a Cayman Islands company and a substantial portion of our assets are
located outside the United States,  particularly in Taiwan.  As a result, it may
be difficult for you to effect  service of process within the United States upon
us. In  addition,  there is  uncertainty  as to whether the courts of the Cayman
Islands and Taiwan would recognize or enforce  judgments of United States courts
obtained  against  us  predicated  upon the civil  liability  provisions  of the
securities  laws of the United States or any state  thereof,  or be competent to
hear  original  actions  brought  in the  Cayman  Islands  or Taiwan  against us
predicated upon the securities laws of the United States or any state thereof.  

Our shareholders may face  difficulties in protecting their interests because we
are incorporated under Cayman Islands law.                                      

     Our  corporate  affairs are  governed  by our  Memorandum  and  Articles of
Association  and by the Companies Law (2002  Revision) and the common law of the
Cayman   Islands.   The   rights   of  our   shareholders   and  the   fiduciary
responsibilities  of our directors  under Cayman  Islands law are not as clearly
established   as  under   statutes  or  judicial   precedent   in  existence  in
jurisdictions in the United States.  Therefore, our public shareholders may have
more  difficulty  in  protecting  their  interests in the face of actions by the
management, directors or our controlling shareholders than would shareholders of
a corporation  incorporated in a jurisdiction  in the United States,  due to the
comparatively less developed nature of Cayman Islands law in this area.         

We may pursue strategic  acquisitions,  investments,  strategic  partnerships or
other  ventures,  and our  business  could be  materially  harmed  if we fail to
successfully identify, complete and integrate such transactions.                

     We intend to evaluate  acquisition  opportunities and opportunities to make
investments in complementary businesses,  technologies, services or products, or
to enter into any strategic  partnerships with parties who can provide access to
those assets,  additional product or services  offerings or additional  industry
expertise.  We currently have no commitments to make any material investments or
acquisitions,  or to enter  into  strategic  partnerships.  We may not  identify
suitable acquisition,  investment or strategic partnership candidates,  or if we
do identify  suitable  candidates,  we may not complete  those  transactions  on
commercially favorable terms, or at all.                                        

     Any future acquisition could result in difficulties  assimilating  acquired
operations and products and diversion of capital and management's attention away
from other business issues and opportunities.  Integration of acquired companies
may result in problems  related to integration  of technology and  inexperienced
management                                                                      

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teams. In addition,  the key personnel of the acquired company may decide not to
work for us. Our  management  has not had  experience in  assimilating  acquired
organizations  and  products  into  our  operations.  We  may  not  successfully
integrate  any  operations,  personnel  or  products  that we may acquire in the
future.  If we fail to successfully  integrate such  transactions,  our business
could be materially harmed.                                                     

We have benefited in the past from Taiwan  government tax incentives  offered on
certain high technology capital investments that may not always be available.   

     Our  effective  tax rate is lower  than the U.S.  Federal  statutory  rate,
because we have  benefited  from lower tax rates  since our  inception  and from
incentives  offered in Taiwan  related  to our high  technology  investments  in
Taiwan.  The loss of these tax benefits  could have a significant  effect on our
financial results in the future.                                                

Changes in our United States federal income tax  classification or in applicable
tax law could result in adverse tax consequences to our shareholders.           

     We do not believe that we (or any of our  non-United  States  subsidiaries)
are  currently  a  "foreign   personal  holding  company"  or  "passive  foreign
investment  company" for United States  federal  income tax  purposes.  We would
constitute a foreign personal holding company in any taxable year if (1) 60% (or
50% in any year  following the year in which we first became a foreign  personal
holding  company) or more of our gross  income  were  foreign  personal  holding
company income (which is generally income of a passive nature such as dividends,
interest and royalties)  (the "income test") and (2) more than 50% of the voting
power or value of our equity were  owned,  directly  or  indirectly,  by five or
fewer U.S. holders that are individuals (the "shareholder  test"). If we (or any
of our non-United  States  subsidiaries)  are  classified as a foreign  personal
holding  company in any taxable  year,  then each  shareholder  that is a United
States  person  would  be  required  to pay tax on its  pro  rata  share  of the
undistributed  foreign  personal holding income of such foreign personal holding
company.  We currently  satisfy the shareholder test for qualifying as a foreign
personal  holding  company  but intend to manage our affairs so as to attempt to
avoid  satisfaction  of the income  test for  qualifying  as a foreign  personal
holding  company,  or minimize the impact to our  shareholders if we satisfy the
income test,  to the extent this  management  of our affairs would be consistent
with our business goals, although we cannot assure you in this regard.          

     We do not expect to become a passive foreign investment  company.  However,
because the passive foreign investment company determination is made annually on
the basis of facts and circumstances  that may be beyond our control and because
the principles for applying the passive foreign investment company tests are not
entirely  clear,  we cannot assure you that we will not become a passive foreign
investment  company. If we are a passive foreign investment company in any year,
then any of our  shareholders  that is a United States person could be liable to
pay  tax at  ordinary  income  tax  rates  plus an  interest  charge  upon  some
distributions by us or when that shareholder  sells our common shares at a gain.
Further,  if we are classified as a passive  foreign  investment  company in any
year in which a  United  States  person  is a  shareholder,  we  generally  will
continue to be treated as a passive foreign  investment  company with respect to
such shareholder in all succeeding  years,  regardless of whether we continue to
satisfy the income or asset tests described above. Additional tax considerations
would  apply  if we or  any  of  our  subsidiaries  were  a  controlled  foreign
corporation or a personal holding company.                                      

Risks Relating to Our Shares                                                    

We do not plan to pay dividends in the foreseeable future.                      

     We do not currently  anticipate  paying cash dividends for the  foreseeable
future.  In addition,  if in the future we  determined  to pay  dividends on our
shares,  as a holding company,  we may be dependent on receipt of funds from our
operating  subsidiaries.  Our principal operating subsidiary is a Taiwan company
and  dividends  payable  to us from  that  company  would be  subject  to Taiwan
withholding tax.                                                                

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The markets for high technology stocks have experienced extreme volatility and  
our share price may be subject to significant fluctuations and volatility.      

     The markets for high technology stocks have experienced  extreme volatility
that has often been  unrelated to the operating  performance  of the  particular
companies.  These broad market  fluctuations  may  adversely  affect the trading
price of our common shares.                                                     

Our officers and directors exert substantial influence over us.                 

     Members of our Board of Directors and our executive officers, together with
members of their  families  and  entities  that may be deemed  affiliates  of or
related to such persons or entities,  beneficially own  approximately 44% of our
outstanding  common  shares.  Accordingly,  these  shareholders  may be  able to
determine the outcome of corporate actions requiring shareholder approval,  such
as mergers and  acquisitions.  This level of  ownership  may have a  significant
effect in delaying,  deferring  or  preventing a change in control of Garmin and
may adversely  affect the voting and other rights of other holders of our common
shares.                                                                         

Prior to 2006, without the approval of a majority of certain of our             
shareholders, we may not dispose of our shares of Garmin Corporation or its     
assets, even if it would benefit all of our shareholders.                       

     In connection  with the  reorganization  whereby  Garmin became the holding
company for Garmin Corporation,  shareholders of Garmin Corporation entered into
a shareholders' agreement whereby each shareholder party to the agreement agreed
to take all reasonable  actions required to prevent the disposition by Garmin of
any shares of Garmin Corporation or of substantially all of the assets of Garmin
Corporation  until after December 31, 2005 except upon approval of a majority in
interest of such shareholders who are U.S. citizens or residents. Certain of our
officers and directors own a substantial portion of these shares.               

Provisions in our charter documents might deter, delay or prevent a third party 
from acquiring us, which could decrease the value of our shares.                

     Our Board of Directors has the authority to issue up to 1,000,000 preferred
shares  and  to  determine  the  price,  rights,  preferences,   privileges  and
restrictions,  including voting rights, of those shares without any further vote
or action by the  shareholders.  This could have an adverse impact on the market
price of our  common  shares.  We have no present  plans to issue any  preferred
shares,  but we may do so.  The rights of the  holders  of common  shares may be
subject  to,  and  adversely  affected  by,  the  rights of the  holders  of any
preferred shares that may be issued in the future. In addition,  we have adopted
a  classified  board of  directors.  Our  shareholders  are unable to remove any
director or the entire  board of directors  without a super  majority  vote.  In
addition,  a super  majority  vote is  required  to  approve  transactions  with
interested  shareholders.   Shareholders  do  not  have  the  right  to  call  a
shareholders  meeting.  We have adopted a shareholders'  rights plan which under
certain circumstances would significantly impair the ability of third parties to
acquire  control of us without prior  approval of our Board of  Directors.  This
shareholders' rights plan and the provisions in our charter documents could make
it more  difficult  for a third  party  to  acquire  us,  even if doing so would
benefit our shareholders.                                                       

Item 7A.  Quantitative and Qualitative Disclosures About Market Risk            

Market Sensitivity                                            

     We have  market  risk  primarily  in  connection  with the  pricing  of our
products and services and the purchase of raw materials. Product pricing and raw
materials  costs  are both  significantly  influenced  by  semiconductor  market
conditions.  Historically, during cyclical industry downturns, we have been able
to offset  pricing  declines for our products  through a combination of improved
product mix and success in obtaining price reductions in raw materials costs.   

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Inflation                                                             

     We do not believe that inflation has had a material effect on our business,
financial  condition  or  results  of  operations.  If our costs  were to become
subject  to  significant  inflationary  pressures,  we may not be able to  fully
offset such higher costs through price increases. Our inability or failure to do
so could  adversely  affect our  business,  financial  condition  and results of
operations.                                                                     

Foreign Currency Exchange Rate Risk                                   

     The  operation  of the  Company's  subsidiaries  in  international  markets
results in exposure to movements in currency  exchange  rates. We generally have
not been significantly  affected by foreign exchange fluctuations because, until
recently, the Taiwan Dollar has proven to be relatively stable.  However, during
2000 and 2001 we  experienced  significant  foreign  currency  gains  due to the
strengthening  of the U.S.  dollar.  The potential of volatile  foreign exchange
rate  fluctuations in the future could have a significant  effect on our results
of operations.                                                                  

     The  principal   currency  involved  is  the  New  Taiwan  Dollar.   Garmin
Corporation,  located in Shijr, Taiwan uses the local currency as the functional
currency. The Company translates all assets and liabilities at year-end exchange
rates and income and expense accounts at average rates during the year. In order
to minimize the effect of the currency exchange  fluctuations on our net assets,
we have elected to retain most of our Taiwan  subsidiary's cash in U.S. dollars.
As discussed above,  the exchange rate can be volatile.  While the net effect of
foreign currency moves in fiscal 2002 was neutral, there were significant shifts
in the exchange rate  throughout  2002.  The exchange rate increased 6.5% during
2001 and resulted in a foreign  currency gain of $11.6 million.  If the exchange
rate decreased by a similar percentage, a comparable foreign currency loss would
be recognized.  A 10% positive or negative change in the US dollar exchange rate
versus the New Taiwan Dollar would have  resulted in a foreign  currency gain of
$18.7 million  (positive 10% change) or a foreign currency loss of $18.9 million
(negative 10% change), respectively during 2002.                                

Interest Rate Risk                                                    

     As of December 28, 2002, we have interest rate risk in connection  with our
industrial  revenue  bonds  that  bear  interest  at  a  floating  rate.  Garmin
International,  Inc. entered into two interest rate swap agreements, one on July
1, 2000 ($10.0  million  notional) and another on February 6, 2001 ($5.0 million
notional),   totaling  $15.0  million  to  modify  the  characteristics  of  its
outstanding  long-term  debt from a floating  rate to a fixed rate basis.  These
agreements  involve the receipt of floating  rate  amounts in exchange for fixed
rate interest  payments over the life of the  agreements  without an exchange of
the underlying  principal amount.  The estimated fair value of the interest swap
agreements  of $1.0  million  is the  amount  we  would  be  required  to pay to
terminate  the swap  agreements at December 28, 2002. A 10% positive or negative
change in the floating  counterparty  interest rates  associated  with the swaps
would change the estimated  fair value of the interest  rate swap  agreements to
$0.9  million  (positive  10% change) or $1.1  million  (negative  10%  change),
respectively.                                                                   

     The Company's average outstanding debt during fiscal 2002 was approximately
$26 million.  The average interest rate on debt during fiscal 2002 was 5.0%. The
average  outstanding  debt  during  fiscal  year  2001 was  approximately  $39.3
million.  The average  interest  rate on debt during fiscal 2001 was 5.5%. A 10%
positive or  negative  change in the average  interest  rate during  fiscal 2002
would have resulted in interest expense of $1.4 million (positive 10% change) or
$1.2 million  (negative 10% change),  respectively.  This compares to the actual
interest expense of $1.3 million during fiscal 2002.                            

     In addition,  at December 28, 2002 the Company is exposed to interest  rate
risk in connection  with its investments in marketable  securities.  As interest
rates change,  the unrealized gains and losses  associated with those securities
will fluctuate accordingly. A hypothetical change of 10% in interest rates would
not have a material effect on such unrealized gains and losses. At December 28, 
2002 unrealized gains on those securities were $1.2 million.                    

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Item 8.  Financial Statements and Supplementary Data                            

 CONSOLIDATED FINANCIAL STATEMENTS

Garmin Ltd. and Subsidiaries
 Years Ended December 28, 2002, December 29, 2001, and December 30, 2000

Contents

Report of Independent Auditors................................................39

Consolidated Balance Sheets at December 28, 2002 and December 29, 2001........40
Consolidated Statements of Income for the Years Ended December 28, 2002,        
   December 29, 2001, and December 30, 2000...................................41
Consolidated Statements of Stockholders' Equity for the Years Ended             
   December 28, 2002, December 29, 2001, and December 30, 2000................42
Consolidated Statements of Cash Flows for the Years Ended December 28, 2002     
   December 29, 2001, and December 30, 2000...................................43
Notes to Consolidated Financial Statements....................................45

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Report of Independent Auditors

The Board of Directors and Stockholders                                         
Garmin Ltd.                                                                     

     We have audited the accompanying consolidated balance sheets of Garmin Ltd.
and  subsidiaries  (the  Company) as of December 28, 2002 and December 29, 2001,
and the related  consolidated  statements of income,  stockholders'  equity, and
cash flows for each of the three years in the period  ended  December  28, 2002.
Our audits also included the financial statement schedule listed in the index at
Item 15(a)(2). These financial statements and schedule are the responsibility of
the Company's  management.  Our responsibility is to express an opinion on these
financial statements and schedule based on our audits.                          

     We conducted our audits in accordance  with  auditing  standards  generally
accepted in the United States.  Those standards require that we plan and perform
the audit to obtain reasonable  assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.  An
audit also includes  assessing the accounting  principles  used and  significant
estimates  made by  management,  as well as  evaluating  the  overall  financial
statement  presentation.  We believe that our audits provide a reasonable  basis
for our opinion.                                                                

     In our opinion,  the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Garmin Ltd. and
subsidiaries  at December 28, 2002 and December 29, 2001,  and the  consolidated
results of their  operations and their cash flows for each of the three years in
the period ended  December 28, 2002, in conformity  with  accounting  principles
generally  accepted in the United  States.  Also,  in our  opinion,  the related
financial statement schedule, when considered in relation to the basic financial
statements  taken as a whole,  presents  fairly  in all  material  respects  the
information set forth therein.                                                  

                                                           /s/ Ernst & Young LLP

Kansas City, Missouri                                                           
January 31, 2003                                                                

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                              Garmin Ltd. and Subsidiaries

                             Consolidated Balance Sheets
                          (In Thousands, Except Share and Per Share Information)

                                                        [Enlarge/Download Table]


                                                                     December 28,      December 29,    
                                                                         2002              2001        
                                                                   ------------------------------------
                                                                                                       
Assets                                                                                                 
Current assets:                                                                                        
   Cash and cash equivalents                                             $216,768         $192,842     
   Marketable securities (Note 3)                                         113,336           40,835     
   Accounts receivable, less allowance for doubtful accounts of                                        
     $3,153 in 2002 and $2,627 in 2001                                     58,278           47,998     
   Inventories                                                             57,507           61,132     
   Deferred income taxes (Note 8)                                          14,847           13,836     
   Prepaid expenses and other current assets                                4,490            2,921     
                                                                   ------------------------------------
Total current assets                                                      465,226          359,564     

Property and equipment (Note 5):                                                                       
   Land and improvements                                                   20,517           20,414     
   Building and improvements                                               33,952           32,864     
   Office furniture and equipment                                          15,086           11,365     
   Manufacturing equipment                                                 18,920           17,282     
   Engineering equipment                                                   15,730           11,671     
   Vehicles                                                                 2,286            1,671     
                                                                   ------------------------------------
                                                                          106,491           95,267     
   Accumulated depreciation                                                32,051           25,181     
                                                                   ------------------------------------
                                                                           74,440           70,086     

Restricted cash (Notes 5 and 6)                                             1,598            1,600     
Marketable securities (Note 3)                                            132,372           90,749     
License agreements, net                                                    19,370           11,408     
Other intangible assets                                                     5,109            5,577     
                                                                   ------------------------------------
Total assets                                                             $698,115         $538,984     
                                                                   ====================================

Liabilities and stockholders' equity                                                                   
Current liabilities:                                                                                   
   Accounts payable                                                      $ 32,446          $18,837     
   Salaries and benefits payable                                            4,178            3,308     
   Accrued warranty costs                                                   5,949            4,777     
   Accrued sales program costs                                              4,752            2,518     
   Other accrued expenses (Note 9)                                          8,000            2,967     
   Income taxes payable                                                    18,080           19,273     
   Current portion of long-term debt (Note 5)                                   -            4,177     
                                                                   ------------------------------------
Total current liabilities                                                  73,405           55,857     

Long-term debt, less current portion (Note 5)                              20,000           28,011     
Deferred income taxes (Note 8)                                              2,211            1,147     

Stockholders' equity:                                                                                  
   Preferred stock, $1.00 par value, 1,000,000 shares authorized,                                      
     none issued                                                                -                -     
   Common stock, $0.01 par value, 500,000,000 shares authorized                                        
     (Notes 12 and 13):                                                                                
       Shares issued and outstanding - 107,919,766 in 2002 and                                         
         107,774,918 in 2001                                                1,080            1,078     
   Additional paid-in capital                                             129,431          127,131     
   Retained earnings (Note 6)                                             507,884          365,087     
   Accumulated other comprehensive loss                                   (35,896)         (39,327)    
                                                                   ------------------------------------
Total stockholders' equity                                                602,499          453,969     
                                                                   ------------------------------------
Total liabilities and stockholders' equity                               $698,115         $538,984     
                                                                   ====================================
See accompanying notes.                                                                                


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                            Garmin Ltd. and Subsidiaries

                             Consolidated Statements of Income
                                (In Thousands, Except Per Share Information)

                                                        [Enlarge/Download Table]


                                                                       Year Ended                      
                                                  -----------------------------------------------------
                                                        December 28,     December 29,     December 30, 
                                                           2002             2001              2000     
                                                  -----------------------------------------------------

                                                                                                       
Net sales                                               $465,144         $369,119         $345,741     
Cost of goods sold                                       210,088          170,960          162,015     
                                                  -----------------------------------------------------
Gross profit                                             255,056          198,159          183,726     

Selling, general, and administrative expenses             45,453           38,709           32,669     
Research and development expense                          32,163           28,164           21,764     
                                                  -----------------------------------------------------
                                                          77,616           66,873           54,433     
                                                  -----------------------------------------------------
Operating income                                         177,440          131,286          129,293     

Other income (expense):                                                                                
   Interest income                                         6,466           11,164            6,925     
   Interest expense                                       (1,329)          (2,174)          (2,287)    
   Foreign currency                                           11           11,573            6,962     
   Other                                                     146              186               29     
                                                  -----------------------------------------------------
                                                           5,294           20,749           11,629     
                                                  -----------------------------------------------------
Income before income taxes                               182,734          152,035          140,922     

Income tax provision (benefit):                                                                        
   Current                                                40,510           40,610           39,723     
   Deferred                                                 (573)          (2,023)          (4,464)    
                                                  -----------------------------------------------------
                                                          39,937           38,587           35,259     
                                                  -----------------------------------------------------
Net income                                              $142,797         $113,448         $105,663     
                                                  =====================================================

Basic and diluted net income per share (Note 14)        $   1.32         $   1.05         $   1.05     
                                                  =====================================================


See accompanying notes.                                                         

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                        Garmin Ltd. and Subsidiaries

                       Consolidated Statements of Stockholders' Equity
                          (In Thousands, Except Share and Per Share Information)

                                                        [Enlarge/Download Table]


                                                                                Accumulated                
                                     Common Stock      Additional                  Other                   
                                  ----------------      Paid-In     Retained    Comprehensive              
                                   Shares    Dollars    Capital     Earnings        Loss          Total    
                                  ------------------------------------------------------------------------ 

                                                                                                           
Balance at December 25, 1999       100,000    $1,000      $29,593    $176,431       $(12,425)    $194,599  
   Net income                            -         -            -     105,663              -      105,663  
   Translation adjustment                -         -            -           -        (10,483)     (10,483) 
                                                                                                 --------- 
     Comprehensive income                                                                          95,180  
   Cash dividend ($0.29 per                                                                                
     share)                              -         -            -     (28,954)            -       (28,954) 
   Issuance of common stock in                                                                             
     initial public offering,                                                                              
     net of offering costs           8,242        82      104,332           -             -       104,414  
                                 --------------------------------------------------------------------------
Balance at December 30, 2000       108,242     1,082      133,925     253,140       (22,908)      365,239  
   Net income                            -         -            -     113,448             -       113,448  
   Translation adjustment                -         -            -           -       (15,519)      (15,519) 
   Adjustment related to                                                                                   
     effective portion of cash                                                                             
     flow hedges, net of income                                                                            
     tax effects of $579                 -         -            -           -          (900)         (900) 
                                                                                                 --------- 
       Comprehensive income                                                                        97,029  
   Issuance of common stock                                                                                
     from exercise of stock                                                                                
     options                             5         1           70           -             -            71  
   Issuance of common stock                                                                                
     through stock purchase plan       123         1        1,463           -             -         1,464  
   Purchase and retirement of                                                                              
     common stock                     (595)       (6)      (8,327)     (1,501)            -        (9,834) 
                                 --------------------------------------------------------------------------
Balance at December 29, 2001       107,775     1,078      127,131     365,087       (39,327)      453,969  
   Net income                            -         -            -     142,797             -       142,797  
   Translation adjustment                -         -            -           -         2,456         2,456  
   Adjustment related to                                                                                   
     effective portion of cash                                                                             
     flow hedges, net of income                                                                            
     tax effects of $170                 -         -            -           -           263           263  
   Adjustment related to                                                                                   
     unrealized gains on                                                                                   
     available-for-sale                                                                                    
     securities, net of income                                                                             
     tax effects of $455                 -         -            -           -           712           712  
                                                                                                 --------- 
       Comprehensive income                                                                       146,228  
   Issuance of common stock                                                                                
     from exercise of stock                                                                                
     options                            74         1        1,252           -             -         1,253  
   Issuance of common stock                                                                                
     through stock purchase plan        70         1        1,048           -             -         1,049  
                                 --------------------------------------------------------------------------
Balance at December 28, 2002       107,919    $1,080     $129,431    $507,884      $(35,896)     $602,499  
                                 ==========================================================================


See accompanying notes.                                                         

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                              Garmin Ltd. and Subsidiaries

                             Consolidated Statements of Cash Flows
                              (In Thousands)

                                                        [Enlarge/Download Table]


                                                                           Year Ended                      
                                                      -----------------------------------------------------
                                                         December 28,     December 29,     December 30,    
                                                             2002             2001             2000        
                                                      -----------------------------------------------------
                                                                                                           
Operating activities                                                                                       
Net income                                                   $142,797          $113,448        $105,663    
Adjustments to reconcile net income to net cash                                                            
   provided by operating activities:                                                                       
     Depreciation                                               8,279             7,341           7,104    
     Amortization                                               7,852             3,527             465    
     (Gain) Loss on disposal of property and                                                               
       equipment                                                   (7)               23           1,605    
     Provision for doubtful accounts                              941             1,137             911    
     Provision for obsolete and slow-moving                                                                
       inventories                                                688             4,000           5,915    
     Foreign currency translation                                 600            (5,593)         (4,831)   
     Deferred income taxes                                       (573)           (2,023)         (4,464)   
     Changes in operating assets and liabilities:                                                          
       Accounts receivable                                    (10,854)          (17,894)         (3,250)   
       Inventories                                              3,173            22,958         (48,024)   
       Prepaid expenses and other current assets               (1,568)             (447)           (373)   
       Accounts payable                                        13,604            (2,657)          7,961    
       Accrued expenses                                         9,716            (1,016)            999    
       Income taxes payable                                       760             7,187          13,812    
                                                      -----------------------------------------------------
Net cash provided by operating activities                     175,408           129,991          83,493    

Investing activities                                                                                       
Purchases of property and equipment                           (12,424)          (14,883)        (24,821)   
Proceeds from sale of property and equipment                       18               239           5,919    
Purchases of marketable securities                           (869,112)       (1,684,985)              -    
Sales of marketable securities                                753,998         1,553,401               -    
Purchase of assets of Sequoia Instruments, Inc.                     -            (3,625)              -    
Purchases of licenses                                         (13,525)          (12,028)         (4,251)   
Change in restricted cash                                           2             4,239          (5,856)   
Other                                                             (29)             (748)             95    
                                                      -----------------------------------------------------
Net cash used in investing activities                        (141,072)         (158,390)        (28,914)   

Financing activities                                                                                       
Dividends                                                           -                 -         (28,954)   
Proceeds from issuance of common stock, net of                                                             
   offering costs                                                   -                 -         104,414    
Proceeds from issuance of common stock through stock                                                       
   purchase plan                                                1,049             1,464               -    
Proceeds from issuance of common stock from exercise                                                       
   of stock options                                             1,026                71               -    
Proceeds from issuance of Industrial Revenue Bonds                  -                 -          20,000    
Principal payments on long-term debt                          (12,236)          (14,189)              -    
Principal payments on notes payable                                 -                 -              (5)   
Purchases of common stock                                           -            (9,834)              -    
                                                      -----------------------------------------------------
Net cash (used in) provided by financing activities           (10,161)          (22,488)         95,455    

Effect of exchange rate changes on cash                          (249)           (8,002)         (2,382)   
                                                      -----------------------------------------------------
Net increase (decrease) in cash and cash equivalents           23,926           (58,889)        147,652    
Cash and cash equivalents at beginning of year                192,842           251,731         104,079    
                                                      -----------------------------------------------------
Cash and cash equivalents at end of year                     $216,768          $192,842        $251,731    
                                                      =====================================================


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                                Garmin Ltd. and Subsidiaries

                               Consolidated Statements of Cash Flows (continued)
                              (In Thousands)

                                                        [Enlarge/Download Table]


                                                                           Year Ended                      
                                                      -----------------------------------------------------
                                                         December 28,     December 29,     December 30,    
                                                             2002             2001             2000        
                                                      -----------------------------------------------------

                                                                                                           
Supplemental disclosures of cash flow information                                                          
Cash paid during the year for income taxes                    $39,992           $38,844         $28,788    
                                                      =====================================================

Cash received during the year from income tax refunds         $     -           $     -         $    12    
                                                      =====================================================

Cash paid during the year for interest, net of $405                                                        
   of capitalized interest in 2000                            $ 1,325           $ 2,011         $ 2,223    
                                                      =====================================================

Supplemental disclosures of non-cash investing and                                                         
   financing activities                                                                                    
Change in liability recognized in accrued expenses                                                         
   related to cash flow hedges and charge to                                                               
   accumulated other comprehensive loss                       $   433           $ 1,479         $     -    
                                                      =====================================================

Change in marketable securities related to                                                                 
   unrealized appreciation                                    $ 1,167           $     -         $     -    
                                                      =====================================================


See accompanying notes.                                                         

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GARMIN LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(In Thousands, Except Share and Per Share Information)
 December 28, 2002 and December 29, 2001

1. Organization                                                                 

     On  July  24,  2000,  the  stockholders  of  Garmin  Corporation   (GARMIN)
incorporated  Garmin Ltd.  (the Company)  under the laws of the Cayman  Islands.
Subsequently,  the  stockholders of GARMIN executed a Shareholders  Agreement to
transfer to Garmin Ltd. their  investments in 88,988,394  common shares of stock
of GARMIN. These shares, which represented  approximately 100% of the issued and
outstanding  common  stock of  GARMIN  as of July  24,  2000,  were  used by the
stockholders  to pay for their  subscriptions  to  100,000,000  common shares of
Garmin Ltd. at a par value of $0.01 or an  aggregate  value of $1,000.  As such,
the  exchange  of shares in this  reorganization  between  GARMIN  and the newly
formed holding company,  Garmin Ltd.,  completed on September 22, 2000, has been
accounted  for at  historical  cost  similar  to  that  in  pooling-of-interests
accounting.  Until April 15, 2002, one share of GARMIN stock was held by each of
six  shareholders  as  nominees  under  nominee  trusts in order to comply  with
Article 2 of the  Company  Law of Taiwan  which  required  that,  as a  "company
limited by stock", GARMIN have at least seven shareholders,  and 4,000 shares of
GARMIN were held by two  shareholders who did not convert their GARMIN shares to
common  shares of the  Company.  These 4,006  shares  represented  approximately
0.004% of the  outstanding  shares of GARMIN.  Taiwan  company law was  recently
changed to remove the requirement  that a Taiwan company have a minimum of seven
shareholders and to permit single shareholder  companies.  As of April 15, 2002,
the Company has  acquired  the 4,000  shares of GARMIN that were held by the two
shareholders and the six nominee  shareholders  have each transferred  their own
share of GARMIN stock to the Company.  As a result,  the Company now owns all of
the outstanding shares of GARMIN. As discussed in Note 12, Garmin Ltd. completed
an initial public offering of its common stock in December 2000.                

2. Summary of Significant Accounting Policies                                   

Basis of Presentation and Principles of Consolidation                           

     The accompanying  consolidated  financial  statements have been prepared in
accordance with accounting  principles  generally accepted in the United States.
Accordingly,  the accompanying  consolidated  financial  statements  reflect the
accounts  of  Garmin  Ltd.  and  its  wholly  owned   subsidiaries   as  if  the
reorganization  described in Note 1 was effective for all periods presented. All
significant inter-company balances and transactions have been eliminated.       

Nature of Business                                                              

     Garmin Ltd. and subsidiaries (together,  the Company) manufacture,  market,
and  distribute  Global  Positioning  System-enabled  products and other related
products.  GARMIN was  incorporated in Taiwan,  Republic of China on January 16,
1990. GARMIN is primarily  responsible for the manufacturing and distribution of
the Company's products to Garmin  International,  Inc. (GII) and Garmin (Europe)
Limited (GEL) and, to a lesser  extent,  new product  development  and sales and
marketing of the  Company's  products in Asia and the Far East. In April 1990, a
100%-owned  subsidiary,  Garmin  International,  Inc., was  incorporated  in the
United  States.  GII is  primarily  responsible  for sales and  marketing of the
Company's  products in many  international  markets and in the United  States as
well as research  and new product  development.  GII also  manufactures  certain
products for the Company's aviation segment. During June 1992, GII formed Garmin
(Europe) Limited,  a wholly owned subsidiary in the United Kingdom,  to sell its
products  principally  within the European  market.  During  2000,  GII sold its
interest in GEL to Garmin Ltd. As a result,  GEL is now a direct  subsidiary  of
Garmin  Ltd.  Also  during  2000,  Garmin  Realty  LLC was formed by GII to hold
certain  real  estate.  In  December  2001,  GII  formed  Garmin  USA as a sales
organization.                                                                   

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GARMIN LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(In Thousands, Except Share and Per Share Information)

2. Summary of Significant Accounting Policies (continued)                       

Fiscal Year                                                                     

     The Company has adopted a 52-53-week  period ending on the last Saturday of
the  calendar  year.  Due to the fact that  there are not  exactly 52 weeks in a
calendar year and there is slightly more than one  additional  day per year (not
including  the  effects of leap year) in each  calendar  year as  compared  to a
52-week fiscal year, the Company will have a fiscal year  comprising 53 weeks in
certain  fiscal  years,  as determined by when the last Saturday of the calendar
year occurs.                                                                    

     In those resulting fiscal years that have 53 weeks, the Company will record
an extra week of sales,  costs, and related financial activity.  Therefore,  the
financial  results of those fiscal years,  and the associated  14-week  quarter,
will not be exactly  comparable to the prior and subsequent 52-week fiscal years
and the associated  quarters having only 13 weeks. Fiscal 2002 and 2001 included
52 weeks while fiscal 2000 was comprised of 53 weeks.                           

Foreign Currency Translation                                                    

     GARMIN utilizes the New Taiwan Dollar as its functional currency.  Prior to
2001,  GEL  utilized  the British  pound  sterling as its  functional  currency.
However,  as a  result  of  an  increase  in  United  States  dollar-denominated
transactions,  GEL changed its  functional  currency to the United States dollar
effective  December 31,  2000.  The impact of this change was not  material.  In
accordance  with  Statement of  Financial  Accounting  Standards  (SFAS) No. 52,
Foreign Currency Translation, the financial statements of GARMIN for all periods
presented  and GEL for  fiscal  2000 have been  translated  into  United  States
dollars,  the  functional  currency of Garmin Ltd.  and GII,  and the  reporting
currency herein,  for purposes of  consolidation at rates prevailing  during the
year for sales,  costs, and expenses and at end-of-year rates for all assets and
liabilities.  The effect of this translation is recorded in a separate component
of  stockholders'  equity.  Cumulative  translation  adjustments  of $35,971 and
$38,427 as of December 28, 2002 and December 29, 2001,  respectively,  have been
included  in  accumulated   other   comprehensive   loss  in  the   accompanying
consolidated balance sheets.                                                    

     Transactions in foreign  currencies are recorded at the approximate rate of
exchange at the transaction  date.  Assets and liabilities  resulting from these
transactions  are  translated  at the rate of  exchange in effect at the balance
sheet date. All  differences  are recorded in results of operations and amounted
to exchange gains of approximately $11, $11,573,  and $6,962 for the years ended
December 28, 2002, December 29, 2001, and December 30, 2000,  respectively.  The
gain in fiscal 2002 is not material due to insignificant changes in the exchange
rates  during  the  year.  The  gain  in  fiscal  2001  is  the  result  of  the
strengthening  of the United States dollar  compared to the New Taiwan Dollar in
the second and fourth  quarters  of fiscal 2001 while the gain in fiscal 2000 is
principally  attributable  to the  strengthening  of the  United  States  dollar
compared to the New Taiwan  Dollar in the fourth  quarter of fiscal 2000.  These
gains are included in other income in the accompanying  consolidated  statements
of income.                                                                      

Earnings Per Share                                                              

     Basic earnings per share amounts are computed based on the weighted-average
number of common shares outstanding. For purposes of diluted earnings per share,
the number of shares  that would be issued from the  exercise of dilutive  stock
options has been reduced by the number of shares which could have been purchased
from the proceeds of the exercise at the average  market price of the  Company's
stock during the period the options were outstanding. See Note 14.              

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GARMIN LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(In Thousands, Except Share and Per Share Information)

2. Summary of Significant Accounting Policies (continued)                       

Cash and Cash Equivalents                                                       

     For purposes of reporting  cash flows,  cash and cash  equivalents  include
cash on hand,  operating  accounts,  money market  funds,  and  securities  with
maturities of three months or less when  purchased.  The carrying amount of cash
and cash equivalents  approximates fair value, given the short maturity of those
instruments.                                                                    

Inventories                                                                     

     Inventories  are stated at the lower of cost or market.  Cost is determined
using the  weighted-average  method (which approximates the first-in,  first-out
(FIFO)  method)  by  GARMIN  and the FIFO  method  by GII and  GEL.  Inventories
consisted of the following:                                                     

                                          December 28,        December 29,
                                          2002                2001
                                           -------------------------------------

Raw materials                              $24,177             $26,381    
Work-in-process                             10,936               9,582    
Finished goods                              31,818              34,723    
Inventory reserves                          (9,424)             (9,554)   
                                           -------------------------------------
                                       $57,507             $61,132
                                           =====================================

Property and Equipment                                                          

     Property  and  equipment  are  recorded at cost and  depreciated  using the
straight-line method over the following estimated useful lives:                 

Buildings and improvements                                      8-55 years
Office furniture and equipment                                   3-8 years
Manufacturing and engineering equipment                          3-8 years
Vehicles                                                         3-5 years

Long-Lived Assets                                                               

     In accordance with SFAS No. 144,  Accounting for the Impairment or Disposal
of Long-Lived  Assets,  the Company  reviews  long-lived  assets for  impairment
whenever events or changes in  circumstances  indicate the carrying amount of an
asset may not be fully recoverable. The carrying amount of a long-lived asset is
not recoverable if it exceeds the sum of the undiscounted cash flows expected to
result from the use and eventual disposition of the asset. That assessment shall
be based on the  carrying  amount  of the  asset  at the date it is  tested  for
recoverability.  An impairment loss shall be measured as the amount by which the
carrying amount of a long-lived  asset exceeds its fair value.  SFAS No. 144 has
not had an impact on the company's consolidated financial statements.           

Intangible Assets                                                               

     On December 30, 2001, the Company adopted SFAS No. 142,  Goodwill and Other
Intangible  Assets.  The statement  addresses how goodwill and other  intangible
assets should be accounted for and tested for impairment.  The standard requires
intangibles  to be  identified  as  either  finite-lived  or  indefinite  lived.
Indefinite-lived  intangible  assets are no longer subject to amortization,  yet
are to be tested for  impairment  annually and on an interim  basis if events or
changes in  circumstances  between annual tests indicate that the asset might be
impaired.  The impairment test requires the  determination  of the fair value of
the intangible asset. If the fair value of the intangible asset is less than its
carrying  value,  an impairment  loss should be recognized in an amount equal to
the  difference.  The asset will then be carried at its new fair  value.  Finite
lived  intangible  assets are still subject to amortization  and are reviewed   

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GARMIN LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(In Thousands, Except Share and Per Share Information)

2. Summary of Significant Accounting Policies (continued)                       

for  impairment in accordance  with SFAS No. 144. The adoption of this statement
did not have a material impact on the Company.                                  

     Finite-lived  intangible assets principally  consist of costs incurred with
certain licensing agreements with a net book value of approximately  $19,370 and
$11,408 at December 28, 2002 and December 29, 2001,  respectively.  Licenses are
being  amortized  over the lives of the related  license  agreements,  which are
generally three years.  Accumulated  amortization is  approximately  $10,377 and
$5,100 at December 28, 2002 and December 29, 2001, respectively.                

     Other  intangible  assets  consist of patents as well as goodwill and other
intangible  assets  acquired in the Company's  purchase of Sequoia  Instruments,
Inc. in November  2001.  The total  purchase  price of $3,625 was  allocated  to
goodwill,  developed  technology,  and other intangibles.  The purchase included
additional  consideration  of $1,000  contingent  on the  completion  of certain
activities expected to occur in 2003 and thereafter.                            

     Patents and other finite lived  intangible  assets with a net book value of
$3,153 and $2,725 are being  amortized  over the  estimated  useful lives of the
related assets, which is generally five to ten years.  Accumulated  amortization
is $547 and $391 at December 28, 2002 and December  29, 2001,  respectively.  No
amortization expense was recorded related to goodwill during 2002 as a result of
adopting SFA No. 142.                                                           

Marketable Securities                                                           

     Management   determines  the  appropriate   classification   of  marketable
securities at the time of purchase and reevaluates  such  designation as of each
balance sheet date.                                                             

     Debt securities not classified as  held-to-maturity  and marketable  equity
securities not classified as trading are classified as  available-for-sale.  All
of the Company's  marketable  securities  are considered  available-for-sale  at
December 28, 2002. See Note 3. Available-for-sale  securities are stated at fair
value,  with the  unrealized  gains and  losses,  net of tax,  reported in other
comprehensive income. During 2002,  significant  unrealized gains of $1,167 were
reported in other comprehensive income, net of related taxes.                   

     The amortized cost of debt securities  classified as  available-for-sale is
adjusted for amortization of premiums and accretion of discounts to maturity, or
in the  case of  mortgage-backed  securities,  over  the  estimated  life of the
security.  Such  amortization is included in interest  income from  investments.
Realized   gains   and   losses,   and   declines   in   value   judged   to  be
other-than-temporary  are included in net securities gains (losses). The cost of
securities sold is based on the specific  identification method.  Realized gains
and losses on available-for-sale securities were not material.                  

Income Taxes                                                                    

     The  Company  accounts  for  income  taxes  using the  liability  method in
accordance with SFAS No. 109,  Accounting for Income Taxes. The liability method
provides  that  deferred tax assets and  liabilities  are recorded  based on the
difference  between the tax bases of assets and  liabilities  and their carrying
amount for financial reporting purposes as measured by the enacted tax rates and
laws that will be in effect when the differences are expected to reverse. Income
taxes have not been accrued at the GARMIN level for the  unremitted  earnings of
GII  totaling  approximately  $122,315  and  $96,948 at  December  28,  2002 and
December  29,  2001,  respectively,  because  such  earnings  are intended to be
reinvested  in this  subsidiary  indefinitely.  Income  taxes have also not been
accrued by the Company for the unremitted earnings of GARMIN or GEL because such
earnings are also intended to be reinvested in these subsidiaries indefinitely. 

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GARMIN LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(In Thousands, Except Share and Per Share Information)

2. Summary of Significant Accounting Policies (continued)                       

Use of Estimates                                                                

     The  preparation of  consolidated  financial  statements in conformity with
accounting   principles   generally  accepted  in  the  United  States  requires
management to make estimates and assumptions that affect the amounts reported in
the consolidated  financial  statements and accompanying  notes.  Actual results
could differ from those estimates.                                              

Concentration of Credit Risk                                                    

     The  Company  grants  credit to certain  customers  who meet the  Company's
pre-established  credit  requirements.  Generally,  the Company does not require
security when trade credit is granted to  customers.  Credit losses are provided
for in the Company's  consolidated  financial  statements and consistently  have
been within management's expectations.                                          

Revenue Recognition                                                             

     The  Company  recognizes  revenue  from  product  sales when the product is
shipped  to the  customer  and title has  transferred.  The  Company  assumes no
remaining  significant  obligations  associated with the product sale other than
that related to its warranty programs discussed below.                          

Shipping and Handling Costs                                                     

     Shipping  and  handling  costs are  included  in cost of goods  sold in the
accompanying consolidated financial statements.                                 

Product Warranty                                                                

     The Company provides for estimated  warranty costs at the time of sale. The
warranty  period  is  generally  for one year  from  date of  shipment  with the
exception of certain  aviation  products  for which the  warranty  period is two
years from the date of installation.                                            

Sales Programs                                                                  

     The Company  provides  certain  monthly and  quarterly  incentives  for its
dealers based on various factors  including dealer purchasing volume and growth.
Additionally,  the Company  provides  rebates to end users on certain  products.
Estimated rebates and incentives  payable to distributors are regularly reviewed
and  recorded  as  accrued  expenses  on a  monthly  basis.  These  rebates  and
incentives  are  recorded  as  reductions  to  net  sales  in  the  accompanying
consolidated statements of income.                                              

Advertising Costs                                                               

     The Company expenses  advertising  costs as incurred.  Advertising  expense
charged to operations amounted to approximately  $16,670,  $14,714,  and $11,529
for the years ended December 28, 2002, December 29, 2001, and December 30, 2000,
respectively.                                                                   

Research and Development                                                        

     Substantially  all  research  and  development  is  performed by GII in the
United States.  Research and development  costs, which are expensed as incurred,
amounted to approximately  $32,163,  $28,164,  and $21,764,  for the years ended
December 28, 2002, December 29, 2001, and December 30, 2000, respectively.      

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GARMIN LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(In Thousands, Except Share and Per Share Information)

2. Summary of Significant Accounting Policies (continued)                       

Accounting for Stock-Based Compensation                                         

     At December 28, 2002, the company has two stock-based employee compensation
plans, which are described more fully in Note 13. The company accounts for those
plans under the recognition  and  measurement  principles of APB Opinion No. 25,
Accounting  for Stock  Issued to  Employees,  and  related  Interpretations.  No
stock-based  employee  compensation  cost is  reflected  in net  income,  as all
options  granted  under those  plans had an  exercise  price equal to the market
value of the underlying  common stock on the date of grant.  The following table
illustrates  the effect on net income and  earnings per share if the company had
applied the fair value  recognition  provisions of SFAS No. 123,  Accounting for
Stock-Based Compensation, to stock-based employee compensation.                 

                                                        [Enlarge/Download Table]


                                                                 December 28,    December 29,     December 30,   
                                                                     2002            2001             2000       
                                                                -------------------------------------------------
                                                                                                                 
Net income as reported                                             $142,797        $113,448         $105,663     
Deduct: Total stock-based employee compensation expense                                                          
  determined under fair-value based method for all awards, net                                                   
  of tax effects                                                     (1,949)         (1,298)             (83)    
                                                                -------------------------------------------------
Pro forma net income                                               $140,848        $112,150         $105,580     
                                                                =================================================
Pro forma net income per share:                                                                                  
  Basic                                                            $   1.31        $   1.04         $   1.05     
  Diluted                                                          $   1.30        $   1.03         $   1.05     


Derivative Investments and Hedging Activities                                   

     The Company adopted SFAS No. 133, Accounting for Derivative Instruments and
Hedging  Activities,  effective December 31, 2000, the beginning of fiscal 2001.
This statement  requires the Company to recognize all derivatives on the balance
sheet at fair value.  Derivatives not considered hedges must be adjusted to fair
value through income.                                                           

     If a derivative is a hedge,  depending on the nature of the hedge,  changes
in the fair value of the derivative  will either be offset against the change in
fair value of the hedged asset, liability or firm commitment through earnings or
recognized in other comprehensive  income until the hedged item is recognized in
earnings. The ineffective portion of a derivative's change in fair value will be
immediately recognized in earnings.                                             

     GII has entered into interest  rate swap  agreements to modify the interest
characteristics  of portions of its  outstanding  long-term debt from a floating
rate to a fixed rate  basis.  These  agreements  involve the receipt of floating
rate amounts in exchange for fixed rate  interest  payments over the life of the
agreements  without  an  exchange  of  the  underlying   principal  amount.  The
differential  to be paid or  received is accrued as  interest  rates  change and
recognized as an adjustment to interest expense related to the debt. The related
amount  payable to or  receivable  from the  counterparty  is  included in other
liabilities or assets. The Company's  agreements qualify for hedge accounting as
permitted in SFAS No. 133,  resulting in the agreement's  being marked to market
at each  balance  sheet date  through  other  comprehensive  income.  Management
assesses the effectiveness of the hedge  relationship on a periodic basis during
the year. See Note 9.                                                           

Recent Pronouncements                                                           

     In June 2002, the FASB issued SFAS No. 146, Accounting for Costs Associated
with Exit or Disposal  Activities,  which  addresses  financial  accounting  and
reporting for costs  associated  with exit or disposal  activities and nullifies
Emerging  Issues Task Force (EITF) Issue No. 94-3,  "Liability  Recognition  for
Certain  Employee  Termination  Benefits  and  Other  Costs to Exit an  Activity
(including Certain Costs Incurred in a  Restructuring)."  The provisions of this
Statement are effective for exit or disposal activities initiated after December
31, 2002.  The Company does not expect that the adoption of this  statement will
have a  significant  impact on the  Company's  financial  position as no exit or
disposal activities are currently planned.                                      

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GARMIN LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(In Thousands, Except Share and Per Share Information)

2. Summary of Significant Accounting Policies (continued)                       

     In December 2002, the FASB issued SFAS No. 148,  Accounting for Stock-Based
Compensation -- Transition and Disclosure.  This statement requires all entities
with  stock-based  employee  compensation  arrangements  to  provide  additional
disclosures in their summary of significant  accounting policies note. Since the
Company uses the intrinsic  value method of APB Opinion No. 25,  Accounting  for
Stock Issued to Employees,  the accounting  policies note will include a tabular
presentation of pro forma net income and earnings per share using the fair value
method  prescribed by SFAS No. 123,  Accounting  for  Stock-Based  Compensation.
Also,  SFAS No.  148  permits  entities  changing  to the fair  value  method of
accounting  for  employee  stock  compensation  to  choose  from  one  of  three
transition methods -- the prospective  method, the modified  prospective method,
or the retroactive  restatement method.  Finally,  SFAS No. 148 will require the
Company to make interim-period pro forma disclosures if stock-based compensation
is accounted for under the intrinsic value method in any period  presented.  The
expanded  annual  disclosure  requirements  and the  transition  provisions  are
effective for the Company's fiscal year 2002. The new interim period disclosures
are required in the Company's financial statements for interim periods beginning
in the first  quarter of fiscal  2003.  The  Company  does not  expect  that the
adoption  of this  statement  will  have a  material  impact on its  results  of
operations or financial position.                                               

Reclassifications                                                               

     Certain  amounts  in  the  fiscal  2000  and  2001  consolidated  financial
statements have been reclassified to conform with the fiscal 2002 presentation. 

3. Marketable Securities                                                        

     The  following  is  a  summary  of  the  Company's  marketable   securities
classified as available-for-sale securities at December 28, 2002:               

                                                        [Enlarge/Download Table]


                                                                              Estimated Fair    
                                                         Gross Unrealized       Value (Net      
                                       Amortized Cost         Gains           Carrying Amount)  
                                     -----------------------------------------------------------

                                                                                                
Mortgage-backed securities                  $58,038            $386                $58,424      
Obligations of states and political                                                             
  subdivisions                               86,006             595                 86,601      
U.S. corporate bonds                         79,572             185                 79,757      
Other                                        20,925               1                 20,926      
                                     -----------------------------------------------------------
Total                                      $244,541          $1,167               $245,708      
                                     ===========================================================


     The  following  is  a  summary  of  the  Company's  marketable   securities
classified as available-for-sale securities at December 29, 2001:               

                                                        [Enlarge/Download Table]

                                                                              Estimated Fair    
                                                         Gross Unrealized       Value (Net      
                                       Amortized Cost         Gains           Carrying Amount)  
                                     -----------------------------------------------------------
                                                                                                
Mortgage-backed securities                  $31,320             $ -                $31,320      
Obligations of states and political                                                             
  subdivisions                               55,116               -                 55,116      
U.S. corporate bonds                         39,575               -                 39,575      
Other                                         5,573               -                  5,573      
                                     -----------------------------------------------------------
Total                                      $131,584             $ -               $131,584      
                                     ===========================================================


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GARMIN LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(In Thousands, Except Share and Per Share Information)

3. Marketable Securities (continued)                                            

     The  amortized  cost and estimated  fair value of marketable  securities at
December 28, 2002, by contractual maturity, are shown below. Expected maturities
will differ from  contractual  maturities  because the issuers of the securities
may have the right to prepay obligations without prepayment penalties.          

                                                        [Enlarge/Download Table]

                                                                               Estimated 
                                                                 Cost          Fair Value
                                                          -------------------------------

                                                                                         
Due in one year or less (2003)                             $113,289             $113,336 
Due after one year through five years (2004 - 2008)         119,380              120,393 
Due after five years through ten years (2009 - 2013)         11,872               11,979 
Due after ten years (2014 and thereafter)                         -                    - 
                                                      ---------------------------------- 
                                                           $244,541             $245,708 
                                                      ================================== 

4.       Line of Credit                                                         

     During December 2000, the Company renewed a line of credit agreement with a
bank providing for maximum  borrowings of $5,000 less indirect  borrowings under
certain standby letters of credit which totaled approximately $4,000 at December
30, 2000. There were no direct or indirect borrowings outstanding under the line
of credit as of December 30, 2000.  The line of credit,  which bears interest at
the bank's prime rate less 1% or LIBOR plus 1.5%,  expired June 28, 2001 and was
unsecured.                                                                      

5.  Long-Term Debt                                                              

     During 1995, GII entered into an agreement with the City of Olathe,  Kansas
for the  construction  of a new corporate  headquarters  (the project) which was
financed  through  issuance of Series 1995 Industrial  Revenue Bonds (the Bonds)
totaling  $9,500.  Upon  completion  of the project in 1996,  GII retired  bonds
totaling $155. During 2002, GII retired the remaining Bonds totaling $9,345.    

     During 1999,  GARMIN borrowed $18,040 to finance the purchase of land and a
new manufacturing facility in Taiwan. The balance was due in 60 equal payment of
principal  plus interest  beginning in November  2001.  Through  November  2001,
interest  was payable at a fixed rate of 6.155%.  Subsequent  to November  2001,
interest is adjustable based on the Republic of China's government  preferential
rate on term  deposits  plus 0.18%.  The Company  opted to prepay a  significant
portion of the outstanding  principal  during 2001. The  outstanding  balance of
$2,891 at December 29, 2001 was paid in full in January 2002.                   

     During 2000,  GII entered into another  agreement  with the City of Olathe,
Kansas to  finance  the  Company's  expansion  of its  manufacturing  facilities
through the issuance of Series 2000  Industrial  Revenue  Bonds (the 2000 Bonds)
totaling  $20,000.  The proceeds from the issuance of the 2000 Bonds were placed
in an interest-bearing restricted cash account controlled by a trustee appointed
by the issuer.  Disbursements  from the account are  restricted  to purchases of
equipment and construction  related to the project and amounted to $0 and $5,696
for years ended  December 28, 2002 and December  29, 2001,  respectively.  There
were no unexpended bond proceeds in this restricted cash account at December 28,
2002.                                                                           

     At December 28, 2002 and December 29, 2001, outstanding principal under the
2000 Bonds totaled  $20,000.  Interest on the 2000 Bonds is payable monthly at a
variable interest rate (1.51% at December 28, 2002), which is adjusted weekly to
the current market rate as determined by the remarketing agent of the 2000 Bonds
with principal due upon maturity at April 15, 2020. See Note 9.                 

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GARMIN LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(In Thousands, Except Share and Per Share Information)

5. Long-Term Debt (continued)                                                   

     The 2000 Bonds are  secured  by an  irrevocable  letter of credit  totaling
$20,288 with facility fees of 0.75%.  This renewable  letter of credit initially
expires on September 20, 2004.                                                  

     The bank has required a sinking fund be established with payments beginning
April 2004 of $4,002 and semiannual  payments of $667  thereafter.  The payments
are to be made to a legally restricted bank account.  Principal and sinking fund
payments on long-term debt are as follows:                                      

Year               Sinking Fund         Principal   
----               -------------        ---------   
2003                        $ -               $ -   
2004                       4,002                -   
2005                       1,334                -   
2006                       1,334                -   
2007                       1,334                -   
Thereafter                11,996           20,000   
                       ------           ------
                      $20,000          $20,000
                      =======          =======

6. Leases and Other Commitments                                                 

     Rental  expense  related to office and warehouse  space for GEL amounted to
$281,  $232, and $139 for the years ended December 28, 2002,  December 29, 2001,
and  December 30,  2000,  respectively.  Future  minimum  lease  payments on the
related  lease are $236 per year through  2007.  In the years 2008 through lease
expiration in 2015, total future minimum lease payments are $1,886.             

     At December  28, 2002 and  December  29,  2001,  standby  letters of credit
amounting to $509 and $871, respectively,  were issued by banks on behalf of the
Company.                                                                        

     Approximately  $50,669  and  $39,000  of  GARMIN's  retained  earnings  are
indefinitely restricted from distribution to stockholders pursuant to the law of
Taiwan at December 28, 2002 and December 29, 2001, respectively.                

     Certain  cash  balances of GEL are held as  collateral  by a bank  securing
payment of the United Kingdom  value-added tax  requirements.  These amounted to
$1,598 and $1,600 at December 28, 2002 and December 29, 2001, respectively,  and
are reported as restricted cash.                                                

7. Employee Benefit Plans                                                       

     GII has an employee  savings plan under which its employees may  contribute
up to 15% of their annual compensation  subject to Internal Revenue Code maximum
limitations.  Additionally,  GEL has a defined contribution plan under which its
employees may contribute up to 5% of their annual compensation. Both GII and GEL
contribute  an amount  determined  annually  at the  discretion  of the Board of
Directors.  During the years ended  December  28, 2002,  December 29, 2001,  and
December 30, 2000, expense related to these plans of $1,467, $1,172, and $1,144,
respectively, was charged to operations.                                        

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GARMIN LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(In Thousands, Except Share and Per Share Information)

7. Employee Benefit Plans (continued)                                           

     Additionally,  GII has a defined  contribution money purchase plan (the MPP
Plan) which covers  substantially  all  employees.  GII  contributes a specified
percentage of each  participant's  annual  compensation  up to certain limits as
defined in the MPP Plan. During the years ended December 28, 2002,  December 29,
2001,  and December 30, 2000,  GII recorded  expense  related to the MPP Plan of
$1,261, $1,184, and $849, respectively.                                         

8. Income Taxes                                                                 

 The Company's income tax provision (benefit) consists of the following:

                                                                [Download Table]


                                 Year Ended                        
            ------------------------------------------------------ 
                December 28,        December 29,       December 30,
                   2002                2001               2000     
                                                                   
Federal:                                                           
  Current         $18,576             $10,208            $14,638   
  Deferred         (1,639)               (338)              (450)  
            ------------------------------------------------------ 
                   16,937               9,870             14,188   
State:                                                             
  Current          (1,035)              2,237              3,479   
  Deferred           (328)                (74)            (2,051)  
            ------------------------------------------------------ 
                   (1,363)              2,163              1,428   
Foreign:                                                           
  Current          22,969              28,165             21,606   
  Deferred          1,394              (1,611)            (1,963)  
            ------------------------------------------------------ 
                   24,363              26,554             19,643   
            ------------------------------------------------------ 
Total             $39,937             $38,587            $35,259   
            ====================================================== 

     The income tax provision  differs from the amount  computed by applying the
statutory  federal  income tax rate to income before taxes.  The sources and tax
effects of the differences are as follows:                                      

                                                        [Enlarge/Download Table]


                                                               Year Ended                       
                                          ------------------------------------------------------
                                              December 28,      December 29,        December 30,
                                                 2002              2001                2000     

                                                                                                
Federal income tax expense at                                                                   
  U.S. statutory rate                            $63,957          $53,212             $49,323   
State income tax expense, net of federal                                                        
  tax effect                                         886            1,406                 928   
Foreign tax rate differential                    (16,759)         (13,640)             (9,623)  
Taiwan tax incentives and credits                (10,757)          (3,260)             (5,181)  
Other, net                                         2,610              869                (188)  
                                          ------------------------------------------------------
Income tax expense                               $39,937          $38,587             $35,259   
                                          ======================================================

     The Company's income before income taxes attributable to foreign operations
was  $146,804,  $120,550,  and $99,171,  for the years ended  December 28, 2002,
December 29, 2001, and December 30, 2000,  respectively.  The tax incentives and
credits  received from Taiwan included in the table above reflect $0.10,  $0.03,
and $0.05 per  weighted-average  common  share  outstanding  for the years ended
December 28, 2002, December 29, 2001, and December 30, 2000,  respectively.  The
Company  currently  expects to benefit  from the  incentives  and credits  being
offered by Taiwan through 2007, at which time these tax benefits expire.        

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GARMIN LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(In Thousands, Except Share and Per Share Information)

8. Income Taxes (continued)                                                     

     Deferred income taxes reflect the net tax effects of temporary  differences
between the carrying  amounts of assets and liabilities for financial  reporting
purposes and the amounts used for income tax purposes. Significant components of
the Company's deferred tax assets and liabilities are as follows:               

                                                       December 28, December 29,
                                                      2002          2001
                                                     ---------------------------
Deferred tax assets:                                                      
     Product warranty accruals                           $1,707           $1,833
     Allowance for doubtful accounts                      1,088              888
     Inventory carrying value                             2,777            2,241
     Sales program allowances                             3,249            1,696
     Vacation accrual                                       507              438
     Interest rate swaps                                    408              579
     Unrealized intercompany profit in inventory          4,994            6,829
     Other                                                  117               46
                                                     ---------------------------
                                                         14,847           14,550
Deferred tax liabilities:                                                 
     Unrealized investment gain                             455                -
     Unrealized foreign currency gains                      623              844
     Depreciation                                         1,133            1,017
                                                     ---------------------------
                                                          2,211            1,861
                                                     ---------------------------
   Net deferred tax assets                              $12,636          $12,689
                                                     ===========================

9. Interest Rate Risk Management                                                

     During  1996,   GII  entered  into  an  interest  rate  swap  agreement  to
effectively  convert a portion of its floating rate  long-term  debt  associated
with the Bonds to a fixed rate basis, thus, reducing the impact of interest rate
changes on future  income.  The agreement was renewed in 2001.  Pursuant to this
"pay-fixed" swap agreement,  GII agreed to exchange, at specified intervals, the
difference between the fixed and the floating interest amounts calculated on the
notional  amount of the swap agreement  totaling $5,000 at December 28, 2002 and
December 29, 2001.  GII's fixed  interest rate under the swap agreement is 5.1%.
The  counterparty's  floating rate is based on the nontaxable PSA Municipal Swap
Index and  amounted to 1.18% and 1.75% at December  28,  2002 and  December  29,
2001,  respectively.  Notional  amounts do not quantify risk or represent assets
and  liabilities  of the  Company,  but are  used in the  determination  of cash
settlements  under the  agreement.  The Company is exposed to credit losses from
counterparty  nonperformance  but  does  not  anticipate  any  losses  from  its
agreement,  which is with a major financial  institution.  The agreement expires
June 6, 2004.                                                                   

     During 2000,  GII entered into an additional  swap agreement to effectively
convert a portion of additional floating rate long-term debt associated with the
2000 Bonds to a fixed rate basis. Pursuant to this pay-fixed swap agreement, GII
agreed to exchange, at specified intervals, the difference between the fixed and
the floating  interest  amounts  calculated  on the notional  amount of the swap
agreement  totaling  $10,000 at December 28, 2002 and  December 29, 2001.  GII's
fixed  interest  rate  under  the  swap  agreement  is  7.26%  compared  to  the
counterparty's floating rate of 1.51% and 2.1% at December 28, 2002 and December
29, 2001, respectively.  The counterparty's floating rate is based on the bank's
Taxable  Low  Floater  Rate.  The  Company  is  exposed  to credit  losses  from
counterparty  nonperformance  but  does  not  anticipate  any  losses  from  its
agreement,  which is with a major financial  institution.  The agreement expires
June 1, 2004.                                                                   

     The fair  value of the  interest  rate swap  agreements  is  recorded  as a
component  of other  accrued  expenses  and  amounted  to $1,046  and  $1,479 at
December 28, 2002 and December 29,  2001,  respectively.  None of the  Company's
cash flow hedges were  deemed  ineffective.                                     

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GARMIN LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(In Thousands, Except Share and Per Share Information)

9.  Interest  Rate Risk  Management (continued)                                 

     At December 28, 2002, the Company expects to reclassify $748 of loss on the
interest rate swaps from accumulated other comprehensive loss to earnings during
the next 12 months related to the payment of variable  interest on floating rate
debt, assuming market interest rates remain consistent with rates at that date. 

10. Fair Value of Financial Instruments                                         

     In accordance with SFAS No. 107,  Disclosures about Fair Value of Financial
Instruments,  the following summarizes required information about the fair value
of  certain  financial  instruments  for which it is  currently  practicable  to
estimate such value.  None of the financial  instruments  are held or issued for
trading  purposes.  The  carrying  amounts  and  fair  values  of the  Company's
financial instruments are as follows:                                           

                                                        [Enlarge/Download Table]


                                        December 28, 2002                  December 29, 2001          
                               -----------------------------------------------------------------------
                                     Carrying          Fair             Carrying          Fair        
                                      Amount           Value             Amount           Value       
                               -----------------------------------------------------------------------
                                                                                                      
Cash and cash equivalents            $216,768         $216,768          $192,842         $192,842     
Restricted cash                         1,598            1,598             1,600            1,600     
Marketable securities                 245,708          245,708           131,584          131,584     
Interest rate swap agreements                                                                         
  (liability)                           1,046            1,046             1,479            1,479     
Long-term debt:                                                                                       
  Term loan                                 -                -             2,843            2,843     
  Series 1995 Bonds                         -                -             9,345            9,345     
  Series 2000 Bonds                    20,000           20,000            20,000           20,000     


     The  carrying  value  of  cash  and  cash  equivalents,   restricted  cash,
marketable securities, and interest rate swap agreements approximates their fair
value. The fair values of the Company's  floating-rate  long-term debt have been
estimated  to be the par  value of the debt due to the  variable  interest  rate
nature of the instruments. The fair values of long-term debt as reported are not
necessarily  the amounts the Company would  currently  have to pay to extinguish
any of this debt.                                                               

11. Segment Information                                                         

     The Company  operates  within its targeted  markets  through two reportable
segments,  those being  related to products  sold into the consumer and aviation
markets.  Both of the Company's  reportable  segments offer products through the
Company's network of independent dealers and distributors.  However,  the nature
of products and types of customers for the two segments vary  significantly.  As
such,  the segments  are managed  separately.  The  Company's  consumer  segment
includes portable global  positioning system (GPS) receivers and accessories for
marine,  recreation,  land, and automotive use sold primarily to retail outlets.
The Company's aviation products are portable and panel mount avionics for Visual
Flight Rules and  Instrument  Flight Rules  navigation and are sold primarily to
aviation dealers and certain aircraft manufacturers.                            

     The  Company's  Chief  Executive  Officer has been  identified as the Chief
Operating  Decision Maker (CODM).  The CODM evaluates  performance and allocates
resources  based on income before  income taxes of each  segment.  Income before
income taxes  represents net sales less  operating  expenses  including  certain
allocated general and administrative costs, interest income and expense, foreign
currency adjustments, and other non-operating corporate expenses. The accounting
policies  of the  reportable  segments  are the same as those  described  in the
summary of significant accounting policies.  There are no inter-segment sales or
transfers.                                                                      

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GARMIN LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(In Thousands, Except Share and Per Share Information)

11. Segment Information (continued)                                             

     The identifiable assets associated with each reportable segment reviewed by
CODM include accounts  receivable and  inventories.  The Company does not report
property and equipment,  depreciation and amortization,  or capital expenditures
by segment to the CODM.                                                         

     Revenues, interest income and interest expense, income before income taxes,
and  identifiable  assets  for each of the  Company's  reportable  segments  are
presented below:                                                                

                                                        [Enlarge/Download Table]


                                             Year Ended December 28, 2002              
                                 ------------------------------------------------------
                                      Consumer         Aviation           Total        
                                 ------------------------------------------------------
                                                                                       
Net sales to external customers        $350,674          $114,470         $465,144     
Allocated interest income                 4,875             1,591            6,466     
Allocated interest expense                1,002               327            1,329     
Income before income taxes              134,859            47,876          182,735     
Assets:                                                                                
  Accounts receivable                    43,942            14,336           58,278     
  Inventory                              43,360            14,147           57,507     


                                                        [Enlarge/Download Table]

                                             Year Ended December 29, 2001              
                                 ------------------------------------------------------
                                      Consumer         Aviation           Total        
                                 ------------------------------------------------------
                                                                                       
Net sales to external customers        $263,358          $105,761         $369,119     
Allocated interest income                 7,960             3,204           11,164     
Allocated interest expense                1,550               624            2,174     
Income before income taxes              102,511            49,524          152,035     
Assets:                                                                                
  Accounts receivable                    34,222            13,776           47,998     
  Inventory                              43,587            17,545           61,132     


                                                        [Enlarge/Download Table]

                                             Year Ended December 30, 2000              
                                 ------------------------------------------------------
                                      Consumer         Aviation           Total        
                                 ------------------------------------------------------
                                                                                       
Net sales to external customers        $230,183         $115,558          $345,741     
Allocated interest income                 4,610            2,315             6,925     
Allocated interest expense                1,522              765             2,287     
Income before income taxes               88,103           52,819           140,922     
Assets:                                                                                
  Accounts receivable                    21,791           10,928            32,719     
  Inventory                              59,843           30,012            89,855     


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GARMIN LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(In Thousands, Except Share and Per Share Information)

11. Segment Information (continued)                                             

     Net sales,  long-lived  assets (property and equipment),  and net assets by
geographic  area are as follows as of and for the years ended December 28, 2002,
December 29, 2001, and December 30, 2000:                                       

                                                        [Enlarge/Download Table]


                                    North America         Asia             Europe            Total     
                                -----------------------------------------------------------------------
                                                                                                       
December 28, 2002                                                                                      
Net sales to external customers       $339,415           $22,673         $103,056          $465,144    
Long-lived assets                       43,599            30,374              467            74,440    
Net assets                             232,430           348,255           21,814           602,499    

December 29, 2001                                                                                      
Net sales to external customers       $275,630           $15,039          $78,450          $369,119    
Long-lived assets                       40,183            29,321              582            70,086    
Net assets                             209,499           228,270           16,200           453,969    

December 30, 2000                                                                                      
Net sales to external customers       $256,782           $16,569          $72,390          $345,741    
Long-lived assets                       32,737            31,453              514            64,704    
Net assets                             197,897           154,095           13,247           365,239    


No single customer  accounted for 10% or more of the Company's  consolidated net
sales in any period.                                                            

12. Initial Public Offering                                                     

     On December 8, 2000, the Company  completed an underwritten  initial public
offering of  12,075,000  (including  shares sold  pursuant to the  underwriters'
over-allotment  option)  shares of its common stock,  8,242,111  shares of which
were  offered by the Company (the  Offering) at an offering  price of $14.00 per
share.  Prior to but in  connection  with the  offering,  the Board of Directors
approved a 1.12379256-for-1 stock split of the Company's common shares, effected
through  a stock  dividend  on  November  6,  2000.  All  share  and  per  share
information included in the accompanying  consolidated  financial statements has
been adjusted to give retroactive effect to the common stock split.             

13. Stock Compensation Plans                                                    

     The Company sponsors several stock compensation plans. The Company accounts
for all of these plans under APB Opinion No. 25,  Accounting for Stock Issued to
Employees, and related interpretations.  Accordingly,  as all awards are granted
at the fair  market  value on the date of  grant,  no  compensation  expense  is
recognized.                                                                     

The various plans are summarized below:                               

2000 Equity Incentive Plan                                                      

     In October 2000,  the  stockholders  adopted an equity  incentive plan (the
Plan)  providing  for grants of incentive  and  nonqualified  stock  options and
"other"  stock  compensation   awards  to  employees  of  the  Company  and  its
subsidiaries,  pursuant  to which up to  3,500,000  shares of  common  stock are
available for issuance.  The stock options  generally vest over a period of five
years or as otherwise  determined by the Board of Directors or the  Compensation
Committee  and  generally  expire  ten  years  from  the date of  grant,  if not
exercised.  Option  activity  under the Plan during 2002 and 2001 is  summarized
below.  There have been no "other" stock  compensation  awards granted under the
Plan.                                                                           

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GARMIN LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(In Thousands, Except Share and Per Share Information)

13. Stock Compensation Plans (continued)                                        

2000 Non-employee Directors' Option Plan                                        

     Also in October  2000,  the  stockholders  adopted a stock  option plan for
non-employee  directors (the Directors Plan) providing for grants of options for
up to 50,000 common shares of the Company's stock. The term of each award is ten
years.  All awards vest evenly over a three-year  period.  During 2002 and 2001,
options to purchase 5,058 and 5,325 shares were granted under this plan.        

     A summary of the Company's  stock option  activity and related  information
under the Equity Incentive Plan and 2000 Non-employee Directors' Option Plan for
the years ended December 28, 2002 and December 29, 2001 is provided below:      

                          Weighted-Average
                                              Exercise Price    Number of Shares
                                            ------------------------------------
                                                                (In Thousands)

  Outstanding at December 30, 2000           $14.00                      1,176
    Granted                                   19.96                        374
     Exercised                                 14.00                         (5)
     Canceled                                  14.00                        (10)
                                                                     -----------
  Outstanding at December 29, 2001            15.45                      1,535
    Granted                                   29.61                        453
     Exercised                                 14.15                        (74)
     Canceled                                  16.58                        (40)
                                                                     -----------
  Outstanding at December 28, 2002            18.90                      1,874
                                                                     ===========

     Outstanding  options at December  30, 2000 were  granted  during  2000.  No
options were exercised or cancelled during 2000.                                

                                   December 28,     December 29     December 30,
                                   2002             2001            2000
                                  ----------------------------------------------
Weighted-average fair value                                               
of options granted during the     $11.42           $12.28          $ 8.53 
year                                                                      

     The  weighted-average  remaining  contract life for options  outstanding at
December 28, 2002 is approximately nine years.  Options  outstanding at December
28, 2002 have  exercise  prices  ranging from $14.00 to $29.79.  At December 28,
2002, options to purchase 520,156 shares are exercisable.                       

     Pro forma  information  regarding  net  income  and  earnings  per share is
required by SFAS No. 123.  SFAS No. 123  requires the pro forma  information  be
determined as if the Company has accounted for its employee  stock options under
the fair value  method of that  statement.  As described  below,  the fair value
accounting  provided  under SFAS No. 123  requires  the use of option  valuation
models that were not developed for use in valuing  employee stock  options.  The
fair  value  for  these  options  was  estimated  at the date of  grant  using a
Black-Scholes   option   pricing  model  with  the  following   weighted-average
assumptions for 2002, 2001 and 2000:  risk-free  interest rate of 1.67%,  5.11%,
and 5.75%  respectively;  no dividend yield;  volatility  factor of the expected
market  price  of the  Company's  common  stock  of  0.3395,  0.591  and  0.530,
respectively; and a weighted-average expected life of the option of seven years.

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GARMIN LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(In Thousands, Except Share and Per Share Information)

13. Stock Compensation Plans (continued)                                        

     The  Black-Scholes   option  valuation  model  was  developed  for  use  in
estimating the fair value of traded  options which have no vesting  restrictions
and are fully  transferable.  In addition,  option  valuation models require the
input of highly  subjective  assumptions,  including  the  expected  stock price
volatility.  Because the Company's  employee stock options have  characteristics
significantly different from those of traded options, and because changes in the
subjective input assumptions can materially  affect the fair value estimate,  in
management's  opinion, the existing models do not necessarily provide a reliable
single measure of the fair value of its employee stock options.                 

Employee Stock Purchase Plan                                                    

     The stockholders also adopted an employee stock purchase plan (ESPP). Up to
1,000,000 shares of common stock have been reserved for the ESPP. Shares will be
offered to  employees  at a price  equal to the lesser of 85% of the fair market
value of the stock on the date of purchase  or 85% of the fair  market  value on
the  enrollment  date.  The ESPP is  intended to qualify as an  "employee  stock
purchase plan" under Section 423 of the Internal  Revenue Code.  During 2002 and
2001,  70,000  and  123,007  shares  were  purchased  under the plan for a total
purchase  price of $1,265 and $1,464,  respectively.  No shares  were  purchased
during 2000. At December 28, 2002,  approximately  807,000  shares are available
for future issuance.                                                            

14. Earnings Per Share                                                          

     The  following  table sets forth the  computation  of basic and diluted net
income per share:                                                               

                                                        [Enlarge/Download Table]


                                                                       Year Ended                       
                                                  ------------------------------------------------------
                                                     December 28,     December 29,      December 30,    
                                                         2002             2001              2000        
                                                                                                        
Numerator:                                                                                              
  Numerator for basic and diluted net income per                                                        
    share - net income                                  $142,797          $113,448         $105,663     
                                                  ======================================================
Denominator (in thousands):                                                                             
  Denominator for basic net income per share -                                                          
    weighted-average common shares                       107,774           108,097          100,489     
  Effect of dilutive securities - employee stock                                                        
    options (Note 13)                                        427               350               17     
                                                  ------------------------------------------------------
  Denominator for diluted net income per share -         108,201           108,447          100,506     
    adjusted weighted-average common shares                                                             
                                                  ======================================================

Basic net income per share                              $   1.32          $   1.05         $   1.05     
                                                  ======================================================

Diluted net income per share                            $   1.32          $   1.05         $   1.05     
                                                  ======================================================


     Options to purchase  472,133  shares of common stock at prices ranging from
$21.67 to $29.79 per share were outstanding during 2002 but were not included in
the  computation  of diluted  earnings per share  because the options'  exercise
price was  greater  than the  average  market  price of the common  shares  and,
therefore, the effect would be antidilutive.                                    

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GARMIN LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(In Thousands, Except Share and Per Share Information)

15. Share Repurchase Program                                                    

     On September  24, 2001,  the Board of Directors  authorized  the Company to
repurchase up to 5,000,000 shares of the Company's common stock through December
31, 2002. Through December 28, 2002, the Company had purchased 595,200 shares at
$9,834.                                                                         

16. Shareholder Rights Plan                                                     

     On October 24,  2001,  Garmin's  Board of Directors  adopted a  shareholder
rights plan (the "Rights Plan"). Pursuant to the Rights Plan, the Board declared
a dividend of one preferred  share  purchase  right on each  outstanding  common
share of Garmin to  shareholders  of record as of November  1, 2001.  The rights
trade  together with Garmin's  common shares.  The rights  generally will become
exercisable  if a person or group  acquires or announces an intention to acquire
15% or more of Garmin's  outstanding common shares. Each right (other than those
held by the new 15% shareholder) will then be exercisable to purchase  preferred
shares of Garmin (or in certain  instances other securities of Garmin) having at
that time a market  value equal to two times the then  current  exercise  price.
Garmin's  Board of  Directors  may  redeem the rights at $0.002 per right at any
time before the rights become exercisable. The rights expire October 31, 2011.  

17. Selected Quarterly Information (Unaudited)                                  

                                                        [Enlarge/Download Table]


                                           Year Ended December 28, 2002                      
                      -----------------------------------------------------------------------
                                                  Quarter Ending                             
                      -----------------------------------------------------------------------
                          March 30          June 29        September 28      December 28     
                      -----------------------------------------------------------------------
                                                                                             
Net sales                  $100,856          $122,838         $107,756         $133,694      
Gross profit                 54,492            67,662           59,051           73,851      
Net income                   26,761            32,146           38,428           45,462      
Net income per share          0.25               0.30            0.36             0.41       


                                                        [Enlarge/Download Table]

                                           Year Ended December 29, 2001                      
                      -----------------------------------------------------------------------
                                                  Quarter Ending                             
                      -----------------------------------------------------------------------
                          March 31          June 30        September 29      December 29     
                      -----------------------------------------------------------------------
                                                                                             
Net sales                   $85,534         $103,634           $86,930          $93,021      
Gross profit                 45,918           55,050            47,729           49,462      
Net income                   23,799           36,603            25,001           28,045      
Net income per share          0.22             0.34              0.23             0.26       

     The above  quarterly  financial  data is  unaudited,  but in the opinion of
management,  all adjustments  necessary for a fair  presentation of the selected
data for these interim periods presented have been included.                    

Item  9.  Changes  in and  Disagreements  with  Accountants  on  Accounting  and
Financial Disclosure                                        

None.                                                       

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PART III

Item 10.  Directors and Executive Officers of the Company                       

     The Company has incorporated by reference  certain  information in response
or partial  response to the Items  under this Part III of this Annual  Report on
Form 10-K pursuant to General Instruction G(3) of this Form 10-K and Rule 12b-23
under the Exchange Act. The Company's  definitive  proxy statement in connection
with its annual meeting of  stockholders  scheduled for June 6, 2003 (the "Proxy
Statement"),  will be filed with the Securities and Exchange Commission no later
than 120 days after December 28, 2002.                                          

(a)      Directors of the Company                                               

     The  information  set forth in response to Item 401 of Regulation S-K under
the headings "Proposal 1-Election of Two Directors" and "The Board of Directors"
in the Company's Proxy Statement is hereby  incorporated  herein by reference in
partial response to this Item 10.                                               

(b)      Executive Officers of the Company                                      

     The  information  set forth in response to Item 401 of Regulation S-K under
the heading  "Executive  Officers and  Significant  Employees of the Company" in
Part I of this Form 10-K is incorporated herein by reference in partial response
to this Item 10.                                                                

(c) Compliance with Section 16(a) of the Exchange Act                           

     The  information  set forth in response to Item 405 of Regulation S-K under
the heading "Section 16(a)  Beneficial  Ownership  Reporting  Compliance" in the
Company's Proxy Statement is hereby  incorporated herein by reference in partial
response to this Item 10.                                                       

Item 11.  Executive Compensation                                                

     The  information  set forth in response to Item 402 of Regulation S-K under
"The Board of  Directors  -  Compensation  of  Directors"  and under  "Executive
Compensation   Matters"  in  the  Company's  Proxy  Statement  (other  than  the
"Compensation  Committee  Report  on  Executive  Compensation"  and  the  "Stock
Performance  Graph") is hereby  incorporated  herein by reference in response to
this Item 11.                                                                   

Item 12.  Security  Ownership of Certain  Beneficial  Owners and  Management and
Related Shareholder Matters                                 

     The  information  set forth in response to Item 403 of Regulation S-K under
the heading "Stock Ownership of Certain Beneficial Owners and Management" in the
Company's Proxy Statement is hereby incorporated herein by reference in response
to this Item 12.                                                                

Equity Compensation Plan Information                                            

     The  following  table gives  information  as of December 28, 2002 about the
Garmin  Common  Shares that may be issued  under all of the  Company's  existing
equity compensation plans.                                                      

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Item 12.  Security Ownership of Certain Beneficial Owners and Management and    
Related Shareholder Matters (Continued)                     

                                                        [Enlarge/Download Table]


------------------------------ ------------------------------ ------------------------- ----------------------------
                                             A                           B                           C              
------------------------------ ------------------------------ ------------------------- ----------------------------
                                                                                                                    
                                                                                           Number of securities     
                                                                                          remaining available for   
Plan Category                   Number of securities to be        Weighted-average         future issuance under    
                                  issued upon exercise of        exercise price of       equity compensation plans  
                                   outstanding options,         outstanding options,       (excluding securities    
                                    warrants and rights         warrants and rights       reflected in column A)    
------------------------------ ------------------------------ ------------------------- ----------------------------
Equity compensation plans                                                                                           
approved by shareholders(1)            1,873,843 (2)                   $19.06                  1,545,688 (3)        
------------------------------ ------------------------------ ------------------------- ----------------------------
Equity compensation plans                                                                                           
not approved by shareholders                --                           --                         --              
------------------------------ ------------------------------ ------------------------- ----------------------------
Total                                    1,873,843                     $19.06                  1,545,688            

------------------------------ ------------------------------ ------------------------- ----------------------------

(1)      Consists of the Garmin Ltd. 2000 Equity Incentive Plan.                

(2)      Excludes purchase rights accruing under the Company's Employee Stock   
     Purchase Plan which has a shareholder approved reserve of 1,000,000
        shares. Under this plan, employees of the Company and its subsidiaries
     may purchase Garmin Common Shares at annual intervals at a purchase
   price equal to 85% of the lower of (a) the market price of Garmin
       Common Shares on the commencement date of each offering period or (b)
     the market price of Garmin Common Shares on the termination date of
each offering period.                                         

(3)      Excludes shares available for issuance under the Garmin Ltd. Employee  
       Stock Purchase Plan. As of December 28, 2002, an aggregate of 806,958
         shares were available for issuance under the Garmin Ltd. Employee Stock
Purchase Plan.                                                

 The Company has no knowledge of any arrangement, the operation of which
may at a subsequent date result in a change in control of the Company.          

Item 13.  Certain Relationships and Related Transactions                        

     The  information  set forth in response to Item 404 of Regulation S-K under
the heading  "The Board of Directors -  Compensation  Committee  Interlocks  and
Insider  Participation" and "Certain  Relationships and Related Transactions" in
the Company's Proxy Statement is incorporated herein by reference in response to
this Item 13.                                                                   

Item 14.  Controls and Procedures                                               

     During  the  90-day  period  prior  to the  filing  date  of  this  report,
management,  including the Company's Chief Executive Officer and Chief Financial
Officer, reviewed and evaluated the effectiveness of the design and operation of
the Company's disclosure controls and procedures. Based upon, and as of the date
of that  evaluation,  the Chief Executive  Officer and Chief  Financial  Officer
concluded  that the Company's  current  disclosure  controls and  procedures are
effective to ensure that information required to be disclosed in the reports the
Company files and submits under the Securities Exchange Act of 1934 is recorded,
processed, summarized and reported as and when required and include controls and
procedures  designed to ensure that information  required to be disclosed by the
Company  in such  reports  is  accumulated  and  communicated  to the  Company's
management,  including  the Chief  Executive  Officer  and the  Chief  Financial
Officer, as appropriate to allow timely decisions regarding required disclosure.

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     There have been no significant  changes in the Company's  internal controls
or  in  other  factors  which  could  significantly   affect  internal  controls
subsequent  to the date the Company  carried out its  evaluation.  There were no
significant  deficiencies  or material  weaknesses  identified in the evaluation
and, therefore, no corrective actions were taken.                               

 PART IV

Item 15.  Exhibits, Financial Statement Schedules and Reports on Form 8-K       

(a) List of Documents filed as part of this Report                              

(1) Consolidated Financial Statements                                           

     The consolidated  financial statements and related notes, together with the
     report  of  Ernst  &  Young  LLP,  appear  in Part  II,  Item 8  "Financial
Statements and Supplementary Data" of this Form 10-K.                 

(2) Schedule II Valuation and Qualifying Accounts                               

     All other schedules have been omitted because they are not applicable,  are
     insignificant  or the  required  information  is shown in the  consolidated
financial statements or notes thereto.                                

(3) Exhibits -- The following exhibits are filed as part of, or incorporated by 
reference into, this Annual Report on Form 10-K:                        

EXHIBIT           DESCRIPTION                                 
NUMBER                                                        
--------          -------------                               

3.1*             Memorandum of Association                  

3.2*             Articles of Association                    

4.1*             Specimen share certificate                 

4.2**            Shareholder Rights Agreement               

10.1*             Garmin Ltd. 2000 Equity Incentive Plan      

        10.2*             Garmin Ltd. 2000 Non-Employee Directors' Option Plan

10.3*             Garmin Ltd. Employee Stock Purchase Plan    

 10.4***           First Amendment to Garmin Ltd. Employee Stock
Purchase Plan             

21.1***           List of subsidiaries                        

23.1              Consent of Ernst & Young LLP                

  24.1              Power of Attorney (included in signature page)

       99.1              Chief Executive Officer's Certification pursuant to
                   Section 906 of the Sarbanes-Oxley Act of 2002

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       99.2              Chief Financial Officer's Certification pursuant to
                   Section 906 of the Sarbanes-Oxley Act of 2002

------------------------------------------------------------------------------- 

* Incorporated by reference from the Registrant's Registration Statement on Form
S-1 filed December 6, 2000 and declared effective on December 8, 2000           
(Commission File No. 333-45514).                                                

** Incorporated by reference from the Registrant's Current Report on Form 8-K   
filed on October 26, 2001.                                                      

*** Incorporated by reference from the Registrant's Annual Report on Form 10-K  
filed on March 27, 2002.                                                        

(b) Reports on Form 8-K                                                         

     The Company  furnished  under Item 9 of Form 8-K,  the  Company's  Form 8-K
dated October 30, 2002 reporting the  announcement of financial  results for the
fiscal quarter ended September 28, 2002.                                        

     The Company  furnished  under Item 9 of Form 8-K,  the  Company's  Form 8-K
dated December 16, 2002 reporting the revision of guidance upward for the fourth
quarter and the announcement of production and facility expansions.             

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GARMIN LTD. AND SUBSIDIARIES
 INDEX TO FINANCIAL STATEMENT SCHEDULE

Garmin Ltd. Financial  Statement Schedule for the years ended December 28, 2002,
December 29, 2001 and December 30, 2000.                                        

   Schedule II - Valuation and qualifying accounts... ........................67

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                                 SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
                                          Garmin Ltd. and Subsidiaries

                                                        [Enlarge/Download Table]

                                                                            Additions                                        
                                                                   -----------------------------                             
                                                      Balance at     Charged to    Charged to                    Balance at  
                                                     Beginning of    Costs and        Other                         End of   
               Description                              Period        Expenses      Accounts      Deductions        Period   
-----------------------------------------------------------------------------------------------------------------------------
                                                                                                                             
Year Ended December 30, 2000:                                                                                                
  Deducted from asset accounts:                                                                                              
    Allowance for doubtful accounts                      $   1,116       $    911       $     -    $  (161)(1)       $  1,866
    Inventory reserve                                        1,727          5,915             -     (1,138)(2)          6,504
                                                    -------------------------------------------------------------------------
Total                                                    $   2,843      $   6,826       $     -    $(1,299)          $  8,370
                                                    =========================================================================

Year Ended December 29, 2001:                                                                                                
  Deducted from asset accounts:                                                                                              
    Allowance for doubtful accounts                      $   1,866      $   1,137       $     -    $  (376)(1)       $  2,627
    Inventory reserve                                        6,504          4,000             -       (950)(2)          9,554
                                                    -------------------------------------------------------------------------
Total                                                    $   8,370      $   5,137       $     -    $(1,326)          $ 12,181
                                                    =========================================================================

Year Ended December 28, 2002:                                                                                                
  Deducted from asset accounts:                                                                                              
    Allowance for doubtful accounts                      $   2,627      $     941       $     -    $  (415)(1)       $  3,153
    Inventory reserve                                        9,554            688                     (818)(2)          9,424
                                                    -------------------------------------------------------------------------
Total                                                    $  12,181     $    1,629       $     -    $(1,233)          $ 12,577
                                                    =========================================================================


(1)  Uncollectible accounts written off, net of recoveries.                     
(2)  Obsolete inventory dispositions and shrinkage.                             

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SIGNATURES

     Pursuant  to the  requirements  of  Section  13 or 15(d) of the  Securities
Exchange  Act of 1934,  the  Company has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.                       

 GARMIN LTD.

              By        /s/ Min H. Kao
                            Min H. Kao
                                         Chief Executive Officer

Dated:  March 25, 2003                                                

 POWER OF ATTORNEY

     Know all  persons  by these  presents,  that each  person  whose  signature
appears below constitutes and appoints Gary L. Burrell and Min H. Kao and Andrew
R. Etkind, and each of them, as his or her  attorney-in-fact,  with the power of
substitution,  for him or her in any and all capacities,  to sign any amendments
to this Annual Report on Form 10-K, and to file the same, with exhibits  thereto
and other  documents in connection  therewith,  with the Securities and Exchange
Commission,  hereby ratifying and confirming all that said attorney-in-fact,  or
his substitute or substitutes, may do or cause to be done by virtue hereof.     

     Pursuant to the  requirements of the Securities  Exchange Act of 1934, this
Annual  Report on Form 10-K has been signed  below by the  following  persons on
behalf of the registrant and in the capacities indicated on March 25, 2003:     

  /s/ Min H. Kao                                       /s/ Gene M. Betts
  --------------                                       -----------------
      Min H. Kao                                           Gene M. Betts
      Co-Chairman, Chief                                        Director
Executive Officer and Director                                    
(Principal Executive Officer)                                     

  /s/ Kevin Rauckman                                  /s/Donald H. Eller
  ------------------                                  ------------------
      Kevin Rauckman                                     Donald H. Eller
   Chief Financial Officer and Treasurer                        Director
(Principal Financial Officer and                                  
Principal Accounting Officer)                                   

  /s/ Gary L. Burrell                            /s/ Thomas A. McDonnell
  -------------------                            -----------------------
      Gary L. Burrell                                Thomas A. McDonnell
      Co-Chairman and Director                                  Director

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 Certification

I, Min H. Kao, certify that:                                                    

1. I have reviewed this annual report on Form 10-K of Garmin Ltd.;              

2.  Based on my  knowledge,  this  annual  report  does not  contain  any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made,  not  misleading  with  respect to the period  covered by this annual
report;.                                                                        

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included  in this annual  report,  fairly  present in all  material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this annual report;         

4.  The  registrant's  other  certifying  officers  and  I are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:              

a) designed  such  disclosure  controls and  procedures  to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others  within  those  entities  particularly  during the
period in which this annual report is being prepared;                           

b) evaluated  the  effectiveness  of the  registrant's  disclosure  controls and
procedures  as of a date  within 90 days prior to the filing date of this annual
report (the "Evaluation Date"); and                                             

c) presented in this annual report our conclusions  about the  effectiveness  of
the  disclosure  controls  and  procedures  based  on our  evaluation  as of the
Evaluation Date;                                                                

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
registrant's   board  of  directors  (or  persons   performing   the  equivalent
functions):                                                                     

a) all significant  deficiencies in the design or operation of internal controls
which  could  adversely  affect the  registrant's  ability  to record,  process,
summarize and report  financial data and have  identified  for the  registrant's
auditors any material weaknesses in internal controls; and                      

b) any  fraud,  whether  or not  material,  that  involves  management  or other
employees who have a significant role in the registrant's internal controls; and

6. The  registrant's  other  certifying  officers  and I have  indicated in this
annual report whether there were significant  changes in internal controls or in
other factors that could  significantly  affect internal controls  subsequent to
the date of our most recent  evaluation,  including any corrective  actions with
regard to significant deficiencies and material weaknesses.                     

Date:  March  25,  2003         By /s/ Min H. Kao                               
        Min H. Kao
                   Co-Chairman and Chief
               Executive Officer

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 Certification

I, Kevin Rauckman, certify that:                                                

1. I have reviewed this annual report on Form 10-K of Garmin Ltd.;              

2.  Based on my  knowledge,  this  annual  report  does not  contain  any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made,  not  misleading  with  respect to the period  covered by this annual
report;.                                                                        

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included  in this annual  report,  fairly  present in all  material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this annual report;         

4.  The  registrant's  other  certifying  officers  and  I are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:              

a) designed  such  disclosure  controls and  procedures  to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others  within  those  entities  particularly  during the
period in which this annual report is being prepared;                           

b) evaluated  the  effectiveness  of the  registrant's  disclosure  controls and
procedures  as of a date  within 90 days prior to the filing date of this annual
report (the "Evaluation Date"); and                                             

c) presented in this annual report our conclusions  about the  effectiveness  of
the  disclosure  controls  and  procedures  based  on our  evaluation  as of the
Evaluation Date;                                                                

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
registrant's   board  of  directors  (or  persons   performing   the  equivalent
functions):                                                                     

a) all significant  deficiencies in the design or operation of internal controls
which  could  adversely  affect the  registrant's  ability  to record,  process,
summarize and report  financial data and have  identified  for the  registrant's
auditors any material weaknesses in internal controls; and                      

b) any  fraud,  whether  or not  material,  that  involves  management  or other
employees who have a significant role in the registrant's internal controls; and

6. The  registrant's  other  certifying  officers  and I have  indicated in this
annual report whether there were significant  changes in internal controls or in
other factors that could  significantly  affect internal controls  subsequent to
the date of our most recent  evaluation,  including any corrective  actions with
regard to significant deficiencies and material weaknesses.                     

Date:  March 25,  2003                  By /s/ Kevin Rauckman                   
                            Kevin Rauckman
                                     Chief Financial Officer

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 Garmin Ltd.
2001 Form 10-K Annual Report
 Exhibit Index

     The  following  exhibits  are attached  hereto.  See Part IV of this Annual
Report on Form 10-K for a complete list of exhibits.                            

Exhibit                                                                         
Number                  Document                                                
------                  --------                                                

23.1                    Consent of Ernst & Young LLP                            

99.1                    Chief Executive Officer's Certification pursuant to     
             Section 906 of the Sarbanes-Oxley Act of 2002

99.2                    Chief Financial Officer's Certification pursuant to     
             Section 906 of the Sarbanes-Oxley Act of 2002

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 Consent of Independent Auditors

     We consent to the incorporation by reference in the Registration Statements
(Form S-8 Nos.  333-51470 and 333-52766)  pertaining to the Garmin Ltd. Employee
Stock  Purchase  Plan,  Garmin Ltd.  2000  Equity  Incentive  Plan,  Garmin Ltd.
Non-Employee  Director Option Plan, and the Garmin  International,  Inc. Savings
and Profit  Sharing Plan of our report dated  January 31, 2003,  with respect to
the consolidated  financial  statements and schedule of Garmin Ltd.  included in
the Annual Report (Form 10-K) for the year ended December 28, 2002.             

                                                          /s/  Ernst & Young LLP

Kansas City, Missouri                                                           
March 25, 2003                                                                  

10-K
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                                                                  EXHIBIT 99.1

 Certification
 Pursuant to Section 906 of the sarbanes-Oxley Act of 2002
 (Subsections (a) and (b) of Section 1350, Chapter 63 of
 Title 18, United States Code)

     Pursuant to section 906 of the  Sarbanes-Oxley Act of 2002 (subsections (a)
and (b) of Section 1350,  Chapter 63 of Title 18, United States Code), I, Min H.
Kao,  Co-Chairman  and Chief  Executive  Officer of Garmin Ltd. (the  "Company")
hereby certify that:                                                            

 (1)      The Annual Report on Form 10-K for the year ended December 28,
         2002 (the "Form 10-K") of the Company fully complies with the
             requirements of Section 13(a) or 15(d) of the Securities Exchange
Act of 1934; and                                    

     (2)      the information contained in the Form 10-K fairly presents, in all
      material respects,  the financial condition and results of
operations of the Company.                          

Dated: March 25, 2003               /s/ Min H. Kao                              
          Min H. Kao
                                       Co-Chairman and Chief Executive Officer

This  certification  accompanies  the Form 10-K  pursuant  to Section 906 of the
Sarbanes-Oxley  Act of 2002 and shall not,  except to the extent required by the
Sarbanes-Oxley  Act of 2002,  be deemed  filed by the  Company  for  purposes of
Section 18 of the Securities Exchange Act of 1934, as amended.                  

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                                                                  EXHIBIT 99.2

 Certification
 Pursuant to Section 906 of the sarbanes-Oxley Act of 2002
 (Subsections (a) and (b) of Section 1350, Chapter 63 of
 Title 18, United States Code)

     Pursuant to section 906 of the  Sarbanes-Oxley Act of 2002 (subsections (a)
and (b) of Section 1350,  Chapter 63 of Title 18, United States Code), I, Min H.
Kao,  Co-Chairman  and Chief  Executive  Officer of Garmin Ltd. (the  "Company")
hereby certify that:                                                            

(1)  The Annual Report on Form 10-K for the year ended December 28, 2002
       (the "Form 10-K") of the Company fully complies with the requirements
       of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)  the information contained in the Form 10-K fairly presents, in all 
      material respects, the financial condition and results of operations
of the Company.                                               

Dated: March 25, 2003             /s/ Kevin Rauckman                            
          Kevin Rauckman
                   Chief Financial Officer

This  certification  accompanies  the Form 10-K  pursuant  to Section 906 of the
Sarbanes-Oxley  Act of 2002 and shall not,  except to the extent required by the
Sarbanes-Oxley  Act of 2002,  be deemed  filed by the  Company  for  purposes of
Section 18 of the Securities Exchange Act of 1934, as amended.                  

Dates Referenced Herein   and   Documents Incorporated By Reference

				Referenced-On Page
This 10-K Filing		Date		First		Last			Other Filings
		1/1/95		28
		12/26/98		15
		12/25/99		15		26
		3/23/00		28
		5/2/00		4
		7/1/00		39
		7/24/00		3		47
		9/22/00		47
		11/6/00		16		60
		12/6/00		67					S-1/A
		12/8/00		15		67			S-8
		12/30/00		15		69			10-K405
		12/31/00		48		52			11-K
		2/6/01		39
		6/28/01		54					11-K
		6/30/01		29					10-Q
		9/11/01		23		32
		9/24/01		3		63
		10/24/01		63					8-K
		10/26/01		67					8-K
		11/1/01		63
		12/15/01		29
		12/29/01		15		69			10-K/A, 10-K405, DEF 14A
		12/30/01		49
		3/27/02		67					10-K405
		4/15/02		47
		5/1/02		4
		6/15/02		29
		6/28/02		1
		8/19/02		4
		8/24/02		3
		9/28/02		67					10-Q
		10/30/02		67					8-K
		12/16/02		13		67			8-K
For The Period Ended		12/28/02		1		76
		12/31/02		3		63			11-K
		1/31/03		41		74
		2/13/03		31
		3/7/03		1		15
Filed On / Filed As Of		3/25/03		70		76
		6/6/03		13		64
		6/1/04		57
		6/6/04		57
		9/20/04		28		55
		12/31/05		38					10-K, 11-K
		10/31/11		63
		4/15/20		28		54
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