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Empresas y finanzas

Logitech Beats Expectations with Sales Up 15% and Raises Outlook


    - Business Wire

    Logitech International (SIX: LOGN) (Nasdaq: LOGI) today announced financial results for the first quarter of Fiscal Year 2019.

    • Q1 sales were $608 million, up 15 percent in US dollars and 12 percent in constant currency, compared to Q1 of the prior year.
    • Q1 GAAP operating income reached $32 million, compared to $31 million in the same quarter a year ago. Q1 GAAP earnings per share (EPS) amounted to $0.23, compared to $0.22 in the same quarter a year ago. GAAP operating income was impacted by a $10 million restructuring charge related to the realignment of resources for growth.
    • Q1 non-GAAP operating income grew 41 percent to $61 million, compared to $43 million in the same quarter a year ago. Q1 non-GAAP EPS grew 42 percent to $0.34, versus $0.24 in the same quarter a year ago.

    "We've delivered a great start to the year and are raising our guidance," said Bracken Darrell, Logitech president and chief executive officer. "The diversity of our portfolio and strength of our innovation engine are working. Our Gaming and Video Collaboration categories both grew more than 60% in Q1. But as we always say, 'you're only as good as what you're doing in the future.' With that in mind, we're playing offense. While innovation investments continue to advance and our business is strong, we are realigning our organization to put more firepower against growth opportunities. We also agreed to acquire Blue Microphones, a leading player in the microphone space."

    Investment Through Acquisition

    Logitech agreed to acquire Blue Microphones, based in Southern California, for approximately $117 million in cash, assuming breakeven net working capital at close. Blue Microphones is a leader in studio-quality microphones for professionals and consumers. The Blue Microphones acquisition is a new adjacent opportunity for Logitech, consistent with the Company's approach to M&A. The transaction, which is expected to close by the end of August 2018, should contribute approximately one point of sales growth in Fiscal Year 2019.

    Investment in Capabilities

    During Q1, Logitech realigned resources to support the continued evolution of its capabilities, portfolio and growth opportunities. The Company has delivered consistent momentum in growth and profitability these past five years and, with this realignment, took proactive steps to prepare for its next five years. As a result, the Company booked a restructuring charge of approximately $10 million this quarter. These actions are designed to reallocate resources and invest in other capabilities and long-term growth opportunities.

    Outlook

    Based on the strong performance in Q1 and the acquisition of Blue Microphones, Logitech raised its Fiscal Year 2019 outlook to 9 to 11 percent sales growth in constant currency, up from its previous outlook of high single-digit sales growth in constant currency. The Company also increased its non-GAAP operating income outlook for Fiscal Year 2019 to a range of $325 million to $335 million, up from its prior range of $310 million to $320 million in non-GAAP operating income.

    Prepared Remarks Available Online

    Logitech has made its prepared written remarks for the financial results teleconference available online on the Logitech corporate website at http://ir.logitech.com.

    Financial Results Teleconference and Webcast

    Logitech will hold a financial results teleconference to discuss the results for Q1 FY 2019 on Tuesday, July 31, 2018 at 8:30 a.m. Eastern Daylight Time and 2:30 p.m. Central European Summer Time. A live webcast of the call will be available on the Logitech corporate website at http://ir.logitech.com.

    Use of Non-GAAP Financial Information and Constant Currency

    To facilitate comparisons to Logitech's historical results, Logitech has included non-GAAP adjusted measures, which exclude share-based compensation expense, amortization of intangible assets, purchase accounting effect on inventory, acquisition-related costs, change in fair value of contingent consideration for business acquisition, restructuring charges (credits), gain (loss) on investments in privately held companies, non-GAAP income tax adjustment, and other items detailed under "Supplemental Financial Information" after the tables below. Logitech also presents percentage sales growth in constant currency to show performance unaffected by fluctuations in currency exchange rates. Percentage sales growth in constant currency is calculated by translating prior period sales in each local currency at the current period's average exchange rate for that currency and comparing that to current period sales. Logitech believes this information, used together with the GAAP financial information, will help investors to evaluate its current period performance and trends in its business. With respect to the Company's outlook for non-GAAP operating income, most of these excluded amounts pertain to events that have not yet occurred and are not currently possible to estimate with a reasonable degree of accuracy. Therefore, no reconciliation to the GAAP amounts has been provided for Fiscal Year 2019.

    About Logitech

    Logitech designs products that have an everyday place in people´s lives, connecting them to the digital experiences they care about. More than 35 years ago, Logitech started connecting people through computers, and now it's a multi-brand company designing products that bring people together through music, gaming, video and computing. Brands of Logitech include Logitech, Ultimate Ears, Jaybird, Logitech G and ASTRO Gaming. Founded in 1981, and headquartered in Lausanne, Switzerland, Logitech International is a Swiss public company listed on the SIX Swiss Exchange (LOGN) and on the Nasdaq Global Select Market (LOGI). Find Logitech at www.logitech.com, the company blog or @Logitech.

    This press release contains forward-looking statements within the meaning of the federal securities laws, including, without limitation, statements regarding: our preliminary financial results for the three months ended June 30, 2018, product portfolio, innovation, strategy, investments, capabilities, realignment of resources, organizational structure, growth opportunities, timing of closing and sales growth from the acquisition of Blue Microphones, sales growth, profitability, momentum, and outlook for Fiscal Year 2019 operating income and sales growth. The forward-looking statements in this release involve risks and uncertainties that could cause Logitech's actual results and events to differ materially from those anticipated in these forward-looking statements, including, without limitation: if our product offerings, marketing activities and investment prioritization decisions do not result in the sales, profitability or profitability growth we expect, or when we expect it; if we fail to innovate and develop new products in a timely and cost-effective manner for our new and existing product categories; if we do not successfully execute on our growth opportunities or our growth opportunities are more limited than we expect; the effect of pricing, product, marketing and other initiatives by our competitors, and our reaction to them, on our sales, gross margins and profitability; if our products and marketing strategies fail to separate our products from competitors' products; if we do not fully realize our goals to lower our costs and improve our operating leverage; if there is a deterioration of business and economic conditions in one or more of our sales regions or product categories, or significant fluctuations in exchange rates; changes in trade policies and agreements and the imposition of tariffs that affect our products or operations; our ability to implement the restructuring in various geographies; possible changes in the size, timing and components of the restructuring or the expected costs and charges associated with the restructuring; risks associated with our ability to achieve improved capabilities, growth opportunities and overall organizational structure; risks associated with acquisitions. A detailed discussion of these and other risks and uncertainties that could cause actual results and events to differ materially from such forward-looking statements is included 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, 2018, available at www.sec.gov, under the caption Risk Factors and elsewhere. Logitech does not undertake any obligation to update any forward-looking statements to reflect new information or events or circumstances occurring after the date of this press release.

    Note that unless noted otherwise, comparisons are year over year.

    Logitech and other Logitech marks are trademarks or registered trademarks of Logitech Europe S.A and/or its affiliates in the U.S. 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 website at www.logitech.com.

                  LOGITECH INTERNATIONAL S.A.             PRELIMINARY RESULTS *

    (In thousands, except per share amounts) - unaudited

                                    Three Months Ended       June 30, GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS    

    2018

        2017               Net sales (A)     $ 608,480       $ 529,946   Cost of goods sold     382,171       334,774   Amortization of intangible assets and purchase accounting effect on inventory     2,372       1,504   Gross profit     223,937       193,668                 Operating expenses:             Marketing and selling     114,584       102,378   Research and development     38,987       35,099   General and administrative     25,473       25,409   Amortization of intangible assets and acquisition-related costs     2,521       1,390   Change in fair value of contingent consideration for business acquisition     —       (1,978 ) Restructuring charges (credits), net     9,921       (55 ) Total operating expenses     191,486       162,243                 Operating income     32,451       31,425   Interest income     2,369       1,175   Other expense, net     (1,571 )     (1,029 ) Income before income taxes     33,249       31,571   Benefit from income taxes     (5,217 )     (5,436 ) Net income     $ 38,466       $ 37,007                 Net income per share:             Basic     $ 0.23       $ 0.23   Diluted     $ 0.23       $ 0.22                 Weighted average shares used to compute net income per share:             Basic     165,317       163,407   Diluted     168,756       168,339                                   LOGITECH INTERNATIONAL S.A.             PRELIMINARY RESULTS * (In thousands) - unaudited                                

    June 30,
    2018

       

    March 31,
    2018

    CONDENSED CONSOLIDATED BALANCE SHEETS                       Current assets:             Cash and cash equivalents     $ 604,116       $ 641,947   Accounts receivable, net (A)     385,546       214,885   Inventories     272,662       259,906   Other current assets (A)     62,542       56,362   Total current assets     1,324,866       1,173,100   Non-current assets:             Property, plant and equipment, net     84,721       86,304   Goodwill     275,418       275,451   Other intangible assets, net     82,719       87,547   Other assets     131,761       120,755   Total assets     $ 1,899,485       $ 1,743,157                 Current liabilities:             Accounts payable     $ 343,680       $ 293,988   Accrued and other current liabilities (A)     384,497       281,732   Total current liabilities     728,177       575,720   Non-current liabilities:             Income taxes payable     33,789       34,956   Other non-current liabilities     82,259       81,924   Total liabilities     844,225       692,600                 Shareholders' equity:             Registered shares, CHF 0.25 par value:     30,148       30,148   Issued and authorized shares — 173,106 at June 30 and March 31, 2018             Conditionally authorized shares — 50,000 at June 30 and March 31, 2018             Additional paid-in capital     19,093       47,234   Shares in treasury, at cost — 7,533 at June 30, 2018 and 8,527 at March 31, 2018     (158,337 )     (165,686 ) Retained earnings (A)     1,259,900       1,232,316   Accumulated other comprehensive loss     (95,544 )     (93,455 ) Total shareholders' equity     1,055,260       1,050,557   Total liabilities and shareholders' equity     $ 1,899,485       $ 1,743,157                                       LOGITECH INTERNATIONAL S.A.             PRELIMINARY RESULTS * (In thousands) - unaudited                   Three Months Ended       June 30, CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS     2018     2017               Cash flows from operating activities:             Net income     $ 38,466       $ 37,007   Adjustments to reconcile net income to net cash provided by (used in) operating activities:             Depreciation     10,699       9,148   Amortization of intangible assets     4,893       2,593   Loss on investments in privately held companies     13       259   Share-based compensation expense     13,259       10,705   Deferred income taxes     (9,659 )     (9,879 ) Change in fair value of contingent consideration for business acquisition     —       (1,978 ) Other     124       (3 ) Changes in assets and liabilities, net of acquisitions:             Accounts receivable, net     (68,557 )     (35,702 ) Inventories     (18,200 )     (20,389 ) Other assets     (4,225 )     (3,088 ) Accounts payable     51,188       38,647   Accrued and other liabilities     (5,719 )     (28,203 ) Net cash provided by (used in) operating activities     12,282       (883 ) Cash flows from investing activities:             Purchases of property, plant and equipment     (8,744 )     (10,035 ) Investment in privately held companies     (225 )     (360 ) Acquisitions, net of cash acquired     (243 )     —   Purchases of trading investments     (2,500 )     (609 ) Proceeds from sales of trading investments     2,867       647   Net cash used in investing activities     (8,845 )     (10,357 ) Cash flows from financing activities:             Purchases of registered shares     (9,982 )     (624 ) Proceeds from exercises of stock options     1,104       12,569   Tax withholdings related to net share settlements of restricted stock units     (25,081 )     (21,683 ) Net cash used in financing activities     (33,959 )     (9,738 ) Effect of exchange rate changes on cash and cash equivalents     (7,309 )     1,102   Net decrease in cash and cash equivalents     (37,831 )     (19,876 ) Cash and cash equivalents , beginning of the period     641,947       547,533   Cash and cash equivalents , end of the period     $ 604,116       $ 527,657                                            

    LOGITECH INTERNATIONAL S.A.

                      PRELIMINARY RESULTS * (In thousands) - unaudited                                 NET SALES     Three Months Ended       June 30,

    SUPPLEMENTAL FINANCIAL INFORMATION

        2018     2017     Change                     Net sales by product category:                   Pointing Devices     $ 127,790       $ 122,074       5 % Keyboards & Combos     128,222       116,113       10   PC Webcams     29,674       25,625       16   Tablet & Other Accessories     32,436       23,218       40   Video Collaboration     58,792       35,617       65   Mobile Speakers     34,327       62,918       (45 )

    Audio & Wearables

        52,154       50,202       4   Gaming     136,026       77,708       75   Smart Home     9,011       16,466       (45 ) Other (1)     48       5       860  

    Total net sales

        $ 608,480       $ 529,946       15                                 (1)     Other category includes products that we currently intend to transition out of, or have already transitioned out of, because they are no longer strategic to our business.                       LOGITECH INTERNATIONAL S.A.             PRELIMINARY RESULTS * (In thousands, except per share amounts) - Unaudited                           GAAP TO NON-GAAP RECONCILIATION (B)     Three Months Ended       June 30, SUPPLEMENTAL FINANCIAL INFORMATION     2018     2017               Gross profit - GAAP     $ 223,937       $ 193,668   Share-based compensation expense     1,130       711   Amortization of intangible assets and purchase accounting effect on inventory     2,372       1,504   Gross profit - Non-GAAP     $ 227,439       $ 195,883                 Gross margin - GAAP     36.8 %     36.5 % Gross margin - Non-GAAP     37.4 %     37.0 %               Operating expenses - GAAP     $ 191,486       $ 162,243   Less: Share-based compensation expense     12,129       9,994   Less: Amortization of intangible assets and acquisition-related costs     2,521       1,390   Less: Change in fair value of contingent consideration for business acquisition     —       (1,978 ) Less: Restructuring charges (credits), net     9,921       (55 ) Operating expenses - Non-GAAP     $ 166,915