Attached files
| file | filename |
|---|---|
| 8-K - 8-K - LOGITECH INTERNATIONAL S.A. | a11-28635_18k.htm |
Exhibit 99.1
|
For Immediate Release |
|
Editorial Contacts:
Joe Greenhalgh, Vice President, Investor Relations — USA (510) 713-4430
Nancy Morrison, Vice President, Corporate Communications — USA (510) 713-4948
Laura Scorza, Sr. Public Relations Manager — Europe +41-(0) 21-863-5336
Logitech Announces Second Quarter Results for FY 2012
FREMONT, Calif. — Oct. 26, 2011 and MORGES, Switzerland, Oct. 27, 2011 — Logitech International (SIX: LOGN) (Nasdaq: LOGI) today announced financial results for the second quarter of Fiscal Year 2012.
Sales for Q2 FY 2012 were $589 million, up 1 percent from $582 million in Q2 FY 2011. Excluding the favorable impact of exchange rate changes, sales declined by 2 percent year over year. Operating income was $23 million compared to $51 million in the same quarter a year ago. Net income for Q2 FY 2012 was $17 million ($0.10 per share) compared to net income of $41 million ($0.23 per share) in Q2 of FY 2011. Gross margin for the quarter was 33.7 percent, down from 37.3 percent one year ago.
Logitech’s retail sales for Q2 FY 2012 increased by 2 percent, with an increase in Asia of 22 percent, and a decrease in the Americas and EMEA of 1 percent. OEM sales decreased by 17 percent. Sales for the LifeSize division grew 19 percent.
“Our Q2 results are consistent with our expectations and the full-year outlook we presented on September 22,” said Guerrino De Luca, Logitech chairman of the board and acting president and chief executive officer. “As we focus on reinvigorating our product offerings and executing in sales and marketing, we expect our initiatives will begin to contribute to improved performance as we move through the second half of FY 2012.”
Share Repurchase Program
Logitech has applied for an amendment of its $250 million buyback program to enable the future repurchase of shares for cancellation. The amendment is subject to the approval of the Swiss regulatory authorities. The Company has approximately $177 million remaining under the program after repurchasing approximately 7.6 million shares for a total of $73 million during Q2 FY 2012.
Outlook
For Fiscal Year 2012, ending March 31, 2012, the Company continues to expect sales of approximately $2.4 billion and operating income of approximately $90 million. The gross margin for the full year, which factors in the very low margin previously reported for Q1, is estimated to reach approximately 33 percent. Gross margin in both Q3 and Q4 is expected to be well above the full year average.
Prepared Remarks Available Online
Logitech has made its prepared written remarks for the financial results teleconference available online on the Logitech corporate Web site at http://ir.logitech.com. The remarks are posted in the Calendar section on the Investor home page.
Financial Results Teleconference and Webcast
Logitech will hold a financial results teleconference to discuss the results for Q2 and the Company’s outlook on Thursday, Oct. 27, 2011 at 8:30 a.m. Eastern Daylight Time and 14:30 Central European Summer Time. A live webcast of the call will be available on the Logitech corporate website at http://ir.logitech.com.
About Logitech
Logitech is a world leader in products that connect people to the digital experiences they care about. Spanning multiple computing, communication and entertainment platforms, Logitech’s combined hardware and software enable or enhance digital navigation, music and video entertainment, gaming, social networking, audio and video communication over the Internet, video security and home-entertainment control. Founded in 1981, Logitech International is a Swiss public company listed on the SIX Swiss Exchange (LOGN) and on the Nasdaq Global Select Market (LOGI).
# # #
This press release contains forward-looking statements, including the statements regarding anticipated sales, operating income and gross margin for FY 2012, gross margin for the second half of FY 2012, and the impact of our product offering and sales and marketing initiatives on future performance. The forward-looking statements in this release involve risks and uncertainties that could cause Logitech’s actual results to differ materially from that anticipated in these forward-looking statements. Factors that could cause actual results to differ materially include: the demand of our customers and our consumers for our products and our ability to accurately forecast it; if our investment prioritization decisions do not result in the sales or profitability growth we expect, or when we expect it; the effect of pricing, product, marketing and other initiatives by our competitors, and our reaction to them, on our sales, gross margins and profitability; the sales mix among our lower- and higher-margin products and our geographic sales mix; if our product offerings and marketing activities do not result in the sales and profitability growth we expect, or when we expect it; if we fail to take advantage of trends in the consumer electronics and personal computers industries, including the growth of mobile computing devices such as smartphones and tablets with touch interfaces, or if significant demand for peripherals to use with tablets and other mobile devices with touch interfaces does not develop; if there is a deterioration of business and economic conditions in one or more
of our sales regions or operating segments, or significant fluctuations in currency exchange rates; if the sales growth in emerging markets for our PC peripherals and other products does not increase as much as we expect; if our operational changes in our EMEA sales region are not completed when we expect, or do not result in the sales improvement in EMEA we expect; the adverse conclusion of one or more ongoing tax audits in various jurisdictions and a material assessment by a governing tax authority that adversely affects our profitability; competition in the video conferencing and communications industry, including from companies with significantly greater resources, sales and marketing organizations, installed base and name recognition; as well as those additional factors set forth in Logitech’s periodic filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the fiscal year ended March 31, 2011, our Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2011, and the Quarterly Report on Form 10-Q we intend to file for the fiscal quarter ended September 30, 2011, available at www.sec.gov. Logitech does not undertake to update any forward-looking statements, which speak as of their respective dates.
Logitech, the Logitech logo, and other Logitech marks are registered in Switzerland and other countries. All other trademarks are the property of their respective owners. For more information about Logitech and its products, visit the company’s Web site at www.logitech.com.
(LOGI - IR)
LOGITECH INTERNATIONAL S.A.
(In thousands, except per share amounts) - Unaudited
|
|
|
Quarter Ended September 30, |
| ||||
|
CONSOLIDATED STATEMENTS OF OPERATIONS |
|
2011 |
|
2010 |
| ||
|
|
|
|
|
|
| ||
|
Net sales |
|
$ |
589,204 |
|
$ |
581,884 |
|
|
Cost of goods sold |
|
390,783 |
|
364,950 |
| ||
|
Gross profit |
|
198,421 |
|
216,934 |
| ||
|
% of net sales |
|
33.7 |
% |
37.3 |
% | ||
|
|
|
|
|
|
| ||
|
Operating expenses: |
|
|
|
|
| ||
|
Marketing and selling |
|
107,446 |
|
97,412 |
| ||
|
Research and development |
|
39,491 |
|
40,927 |
| ||
|
General and administrative |
|
27,989 |
|
27,420 |
| ||
|
Total operating expenses |
|
174,926 |
|
165,759 |
| ||
|
|
|
|
|
|
| ||
|
Operating income |
|
23,495 |
|
51,175 |
| ||
|
|
|
|
|
|
| ||
|
Interest income, net |
|
601 |
|
635 |
| ||
|
Other expense, net |
|
(1,763 |
) |
(1,794 |
) | ||
|
|
|
|
|
|
| ||
|
Income before income taxes |
|
22,333 |
|
50,016 |
| ||
|
Provision for income taxes |
|
4,888 |
|
8,856 |
| ||
|
|
|
|
|
|
| ||
|
Net income |
|
$ |
17,445 |
|
$ |
41,160 |
|
|
|
|
|
|
|
| ||
|
Shares used to compute net income per share: |
|
|
|
|
| ||
|
Basic |
|
176,878 |
|
176,359 |
| ||
|
Diluted |
|
177,277 |
|
177,958 |
| ||
|
Net income per share: |
|
|
|
|
| ||
|
Basic |
|
$ |
0.10 |
|
$ |
0.23 |
|
|
Diluted |
|
$ |
0.10 |
|
$ |
0.23 |
|
LOGITECH INTERNATIONAL S.A.
(In thousands, except per share amounts) - Unaudited
|
|
|
Six Months Ended September 30, |
| ||||
|
CONSOLIDATED STATEMENTS OF OPERATIONS |
|
2011 |
|
2010 |
| ||
|
|
|
|
|
|
| ||
|
Net sales |
|
$ |
1,069,645 |
|
$ |
1,061,214 |
|
|
Cost of goods sold |
|
745,617 |
|
675,251 |
| ||
|
Gross profit |
|
324,028 |
|
385,963 |
| ||
|
% of net sales |
|
30.3 |
% |
36.4 |
% | ||
|
|
|
|
|
|
| ||
|
Operating expenses: |
|
|
|
|
| ||
|
Marketing and selling |
|
207,239 |
|
188,889 |
| ||
|
Research and development |
|
79,472 |
|
79,316 |
| ||
|
General and administrative |
|
58,854 |
|
54,780 |
| ||
|
Total operating expenses |
|
345,565 |
|
322,985 |
| ||
|
|
|
|
|
|
| ||
|
Operating income (loss) |
|
(21,537 |
) |
62,978 |
| ||
|
|
|
|
|
|
| ||
|
Interest income, net |
|
1,291 |
|
1,156 |
| ||
|
Other income, net |
|
3,428 |
|
2 |
| ||
|
|
|
|
|
|
| ||
|
Income (loss) before income taxes |
|
(16,818 |
) |
64,136 |
| ||
|
Provision (benefit) for income taxes |
|
(4,657 |
) |
3,454 |
| ||
|
|
|
|
|
|
| ||
|
Net income (loss) |
|
$ |
(12,161 |
) |
$ |
60,682 |
|
|
|
|
|
|
|
| ||
|
Shares used to compute net income (loss) per share: |
|
|
|
|
| ||
|
Basic |
|
178,111 |
|
175,921 |
| ||
|
Diluted |
|
178,111 |
|
177,588 |
| ||
|
Net income (loss) per share: |
|
|
|
|
| ||
|
Basic |
|
$ |
(0.07 |
) |
$ |
0.34 |
|
|
Diluted |
|
$ |
(0.07 |
) |
$ |
0.34 |
|
LOGITECH INTERNATIONAL S.A.
(In thousands) - Unaudited
|
CONSOLIDATED BALANCE SHEETS |
|
September 30, 2011 |
|
March 31, 2011 |
|
September 30, 2010 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Current assets |
|
|
|
|
|
|
| |||
|
Cash and cash equivalents |
|
$ |
379,450 |
|
$ |
477,931 |
|
$ |
307,679 |
|
|
Accounts receivable |
|
294,691 |
|
258,294 |
|
304,998 |
| |||
|
Inventories |
|
325,053 |
|
280,814 |
|
343,021 |
| |||
|
Other current assets |
|
85,004 |
|
59,347 |
|
63,482 |
| |||
|
Total current assets |
|
1,084,198 |
|
1,076,386 |
|
1,019,180 |
| |||
|
Property, plant and equipment |
|
78,416 |
|
84,160 |
|
91,122 |
| |||
|
Intangible assets |
|
|
|
|
|
|
| |||
|
Goodwill |
|
560,343 |
|
547,184 |
|
553,794 |
| |||
|
Other intangible assets |
|
66,693 |
|
74,616 |
|
88,389 |
| |||
|
Other assets |
|
74,053 |
|
79,210 |
|
66,877 |
| |||
|
Total assets |
|
$ |
1,863,703 |
|
$ |
1,861,556 |
|
$ |
1,819,362 |
|
|
|
|
|
|
|
|
|
| |||
|
Current liabilities |
|
|
|
|
|
|
| |||
|
Accounts payable |
|
$ |
342,070 |
|
$ |
298,160 |
|
$ |
370,033 |
|
|
Accrued liabilities |
|
187,017 |
|
172,560 |
|
198,727 |
| |||
|
Total current liabilities |
|
529,087 |
|
470,720 |
|
568,760 |
| |||
|
Other liabilities |
|
185,277 |
|
185,835 |
|
160,521 |
| |||
|
Total liabilities |
|
714,364 |
|
656,555 |
|
729,281 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Shareholders’ equity |
|
1,149,339 |
|
1,205,001 |
|
1,090,081 |
| |||
|
|
|
|
|
|
|
|
| |||
|
Total liabilities and shareholders’ equity |
|
$ |
1,863,703 |
|
$ |
1,861,556 |
|
$ |
1,819,362 |
|
LOGITECH INTERNATIONAL S.A.
(In thousands) - Unaudited
|
|
|
Six Months Ended September 30, |
| ||||
|
CONSOLIDATED STATEMENTS OF CASH FLOWS |
|
2011 |
|
2010 |
| ||
|
|
|
|
|
|
| ||
|
Cash flows from operating activities: |
|
|
|
|
| ||
|
Net income (loss) |
|
$ |
(12,161 |
) |
$ |
60,682 |
|
|
Non-cash items included in net income (loss): |
|
|
|
|
| ||
|
Depreciation |
|
24,593 |
|
23,343 |
| ||
|
Amortization of other intangible assets |
|
13,556 |
|
14,027 |
| ||
|
Inventory valuation adjustment |
|
34,074 |
|
— |
| ||
|
Share-based compensation expense |
|
16,453 |
|
16,720 |
| ||
|
Gain on disposal of property and plant |
|
(4,904 |
) |
(838 |
) | ||
|
Excess tax benefits from share-based compensation |
|
(30 |
) |
(676 |
) | ||
|
Loss on cash surrender value of life insurance policies |
|
— |
|
169 |
| ||
|
Deferred income taxes and other |
|
(8,554 |
) |
1,995 |
| ||
|
Changes in assets and liabilities: |
|
|
|
|
| ||
|
Accounts receivable |
|
(36,517 |
) |
(99,615 |
) | ||
|
Inventories |
|
(59,589 |
) |
(129,497 |
) | ||
|
Other assets |
|
(6,886 |
) |
(5,511 |
) | ||
|
Accounts payable |
|
45,088 |
|
110,775 |
| ||
|
Accrued liabilities |
|
(3,489 |
) |
13,316 |
| ||
|
Net cash provided by operating activities |
|
1,634 |
|
4,890 |
| ||
|
|
|
|
|
|
| ||
|
Cash flows from investing activities: |
|
|
|
|
| ||
|
Acquisitions and investments, net of cash acquired |
|
(18,814 |
) |
(7,300 |
) | ||
|
Purchases of property, plant and equipment |
|
(20,921 |
) |
(25,419 |
) | ||
|
Proceeds from sale of property and plant |
|
4,904 |
|
2,688 |
| ||
|
Purchases of trading investments |
|
(4,536 |
) |
— |
| ||
|
Proceeds from sales of trading investments |
|
4,522 |
|
— |
| ||
|
Net cash used in investing activities |
|
(34,845 |
) |
(30,031 |
) | ||
|
|
|
|
|
|
| ||
|
Cash flows from financing activities: |
|
|
|
|
| ||
|
Purchases of treasury shares |
|
(73,134 |
) |
— |
| ||
|
Proceeds from sale of shares upon exercise of options and purchase rights |
|
9,764 |
|
16,570 |
| ||
|
Tax withholdings related to net share settlements of restricted stock units |
|
(185 |
) |
(223 |
) | ||
|
Excess tax benefits from share-based compensation |
|
30 |
|
676 |
| ||
|
Net cash provided by (used in) financing activities |
|
(63,525 |
) |
17,023 |
| ||
|
|
|
|
|
|
| ||
|
Effect of exchange rate changes on cash and cash equivalents |
|
(1,745 |
) |
(4,147 |
) | ||
|
Net decrease in cash and cash equivalents |
|
(98,481 |
) |
(12,265 |
) | ||
|
Cash and cash equivalents at beginning of period |
|
477,931 |
|
319,944 |
| ||
|
Cash and cash equivalents at end of period |
|
$ |
379,450 |
|
$ |
307,679 |
|
LOGITECH INTERNATIONAL S.A.
(In thousands, except per share amounts) - Unaudited
|
|
|
Quarter Ended |
|
Six Months Ended |
| ||||||||
|
|
|
September 30, |
|
September 30, |
| ||||||||
|
SUPPLEMENTAL FINANCIAL INFORMATION |
|
2011 |
|
2010 |
|
2011 |
|
2010 |
| ||||
|
|
|
|
|
|
|
|
|
|
| ||||
|
Depreciation |
|
$ |
11,421 |
|
$ |
11,005 |
|
$ |
24,593 |
|
$ |
23,343 |
|
|
Amortization of other intangible assets |
|
6,926 |
|
7,116 |
|
13,556 |
|
14,027 |
| ||||
|
Operating income (loss) |
|
23,495 |
|
51,175 |
|
(21,537 |
) |
62,978 |
| ||||
|
Operating income before depreciation and amortization |
|
41,842 |
|
69,296 |
|
16,612 |
|
100,348 |
| ||||
|
Capital expenditures |
|
10,360 |
|
13,501 |
|
20,921 |
|
25,419 |
| ||||
|
|
|
|
|
|
|
|
|
|
| ||||
|
Net sales by channel: |
|
|
|
|
|
|
|
|
| ||||
|
Retail |
|
$ |
501,735 |
|
$ |
489,721 |
|
$ |
896,511 |
|
$ |
883,587 |
|
|
OEM |
|
50,261 |
|
60,850 |
|
99,439 |
|
119,186 |
| ||||
|
LifeSize |
|
37,208 |
|
31,313 |
|
73,695 |
|
58,441 |
| ||||
|
Total net sales |
|
$ |
589,204 |
|
$ |
581,884 |
|
$ |
1,069,645 |
|
$ |
1,061,214 |
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
Net retail sales by product family: |
|
|
|
|
|
|
|
|
| ||||
|
Retail - Pointing Devices |
|
$ |
148,386 |
|
$ |
153,870 |
|
$ |
280,448 |
|
$ |
285,716 |
|
|
Retail - Keyboards & Desktops |
|
109,325 |
|
94,507 |
|
203,921 |
|
169,788 |
| ||||
|
Retail - Audio |
|
130,815 |
|
119,965 |
|
212,379 |
|
215,611 |
| ||||
|
Retail - Video |
|
57,422 |
|
68,794 |
|
107,267 |
|
115,850 |
| ||||
|
Retail - Gaming |
|
29,152 |
|
21,207 |
|
52,545 |
|
36,658 |
| ||||
|
Retail - Digital Home |
|
26,635 |
|
31,378 |
|
39,951 |
|
59,964 |
| ||||
|
Total net retail sales |
|
$ |
501,735 |
|
$ |
489,721 |
|
$ |
896,511 |
|
$ |
883,587 |
|
|
|
|
Quarter Ended |
|
Six Months Ended |
| ||||||||
|
|
|
September 30, |
|
September 30, |
| ||||||||
|
Share-based Compensation Expense |
|
2011 |
|
2010 |
|
2011 |
|
2010 |
| ||||
|
|
|
|
|
|
|
|
|
|
| ||||
|
Cost of goods sold |
|
$ |
950 |
|
$ |
919 |
|
$ |
2,110 |
|
$ |
1,910 |
|
|
Marketing and selling |
|
3,448 |
|
3,091 |
|
6,965 |
|
6,168 |
| ||||
|
Research and development |
|
1,754 |
|
1,776 |
|
3,562 |
|
3,552 |
| ||||
|
General and administrative |
|
586 |
|
2,472 |
|
3,816 |
|
5,090 |
| ||||
|
Income tax benefit |
|
(2,276 |
) |
(2,442 |
) |
(4,665 |
) |
(4,337 |
) | ||||
|
Total share-based compensation expense after income taxes |
|
$ |
4,462 |
|
$ |
5,816 |
|
$ |
11,788 |
|
$ |
12,383 |
|
|
|
|
|
|
|
|
|
|
|
| ||||
|
Share-based compensation expense net of tax, per share (diluted) |
|
$ |
0.03 |
|
$ |
0.03 |
|
$ |
0.07 |
|
$ |
0.07 |
|
Constant dollar sales (sales excluding impact of exchange rate changes)
We refer to our net sales excluding the impact of foreign currency exchange rates as constant dollar sales. Constant dollar sales are a non-GAAP financial measure, which is information derived from consolidated financial information but not presented in our financial statements prepared in accordance with U.S. GAAP. Our management uses these non-GAAP measures in its financial and operational decision-making, and believes these non-GAAP measures, when considered in conjunction with the corresponding GAAP measures, facilitate a better understanding of changes in net sales. Constant dollar sales are calculated by translating prior period sales in each local currency at the current period’s average exchange rate for that currency.