EX-99.1 2 a13-10791_1ex99d1.htm EX-99.1

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 Fourth Quarter and Full-Year

Financial Results for FY 2013

 

Improved Profitability Expected for FY 2014

 

NEWARK, Calif. April 24, 2013 and MORGES, Switzerland, April 25, 2013 — Logitech International (SIX: LOGN) (Nasdaq: LOGI) today announced financial results for the fourth quarter and full year of Fiscal Year 2013.

 

Sales for Q4 FY 2013 were $469 million, down 12 percent from $532 million in Q4 FY 2012. Excluding the unfavorable impact of exchange rates, sales were down by 11 percent compared to the prior year. The Company posted an operating loss for the fourth quarter of $37 million compared to operating income of $24 million in the same quarter a year ago. The operating loss included $16 million in restructuring charges and $6 million related to the impairment of goodwill and other assets. The net loss for Q4 FY 2013 was $36 million ($0.23 per share) compared to net income of $28 million ($0.17 per share) in the prior year. Gross margin for Q4 FY 2013 was 33.5 percent, down from 36.4 percent a year ago.

 

Logitech’s retail sales for Q4 FY 2013 decreased by 10 percent year over year, up 2 percent in Asia, down 2 percent in the Americas and down 25 percent in EMEA. OEM sales decreased by 21 percent and sales for the LifeSize division decreased by 19 percent.

 

For the full 2013 fiscal year, ending March 31, 2013, sales were $2.1 billion, compared to $2.3 billion in FY 2012. The Company posted an operating loss of $252 million. Excluding impairment and restructuring charges, FY 2013 non-GAAP operating income would have been $8 million. The net loss for the full fiscal year was $228 million ($1.44 per share) compared to net income of $71 million ($0.41 per share) in FY 2012. Gross margin for FY 2013 was 33.7 percent compared to 33.5 percent in FY 2012.

 



 

Logitech Announces Q4 and Full-Year FY 2013 ResultsPage 2

 

“Regionally, with the exception of EMEA, our retail business has begun to stabilize,” said Bracken P. Darrell, Logitech president and chief executive officer. “In Europe, the combination of the difficult macro-economic environment and the very slow PC market stalled our business in Q4. For the rest of our retail business (Americas and Asia), sales of our mice and keyboards grew 6 percent, much better than the market for PCs, which was down globally nearly 14 percent year over year. I was also pleased with the strong momentum of our tablets accessories during the fourth quarter. We recently launched a version of our best-selling Ultrathin Keyboard Cover for the iPad mini as well as a range of new tablet folios.

 

“In closing FY 2013, I believe we have taken appropriate actions to effect a turnaround,” said Mr. Darrell. “We have narrowed our strategic focus; restructured the company, including our LifeSize division; and prioritized our resources to create great new products for tablets. While the PC market continues to weigh upon parts of our business, and the ongoing economic uncertainty in much of Europe shows no signs of improvement, our product portfolio and indications of stabilization in the Americas and Asia, combined with the cost savings resulting from our FY 2013 restructuring initiatives, position us for improved profitability in FY 2014.

 

Outlook

 

For Fiscal Year 2014, ending March 31, 2014, Logitech currently expects sales of approximately $2 billion, operating income of approximately $50 million and gross margin of approximately 34 percent.

 

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 Q4 FY 2013 on Thursday, April 25, 2013 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 within the meaning of the federal securities laws, including, without limitation, statements regarding: improved profitability, the stabilization and turnaround of our business, momentum of our tablets accessories, new product development, and Fiscal Year 2014 sales, operating income and gross margin. 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; the demand of our customers and our consumers for our products and our ability to accurately forecast 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 in our new product categories and sales in emerging market geographies; if sales of PC peripherals in mature markets are less 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 there is a deterioration of business and economic conditions in one or more of our sales regions or operating segments, or significant fluctuations in exchange rates. 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 Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2012, 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.

 

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.

 

(LOGIIR)

 



 

LOGITECH INTERNATIONAL S.A.

 

(In thousands, except per share amounts) - Unaudited

 

 

 

Quarter Ended March 31,

 

CONSOLIDATED STATEMENTS OF OPERATIONS

 

2013

 

2012

 

 

 

 

 

 

 

Net sales

 

$

469,087

 

$

531,962

 

Cost of goods sold

 

312,129

 

338,075

 

Gross profit

 

156,958

 

193,887

 

% of net sales

 

33.5

%

36.4

%

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

Marketing and selling

 

107,480

 

100,302

 

Research and development

 

36,582

 

40,948

 

General and administrative

 

28,982

 

28,896

 

Impairment of goodwill and other assets

 

5,688

 

 

Restructuring charges

 

15,506

 

 

Total operating expenses

 

194,238

 

170,146

 

 

 

 

 

 

 

Operating income (loss)

 

(37,280

)

23,741

 

 

 

 

 

 

 

Interest income, net

 

255

 

466

 

Other income, net

 

2,139

 

6,481

 

 

 

 

 

 

 

Income (loss) before income taxes

 

(34,886

)

30,688

 

Provision for income taxes

 

1,028

 

2,402

 

 

 

 

 

 

 

Net income (loss)

 

$

(35,914

)

$

28,286

 

 

 

 

 

 

 

Shares used to compute net income (loss) per share:

 

 

 

 

 

Basic

 

158,716

 

169,387

 

Diluted

 

158,716

 

170,401

 

Net income (loss) per share:

 

 

 

 

 

Basic

 

$

(0.23

)

$

0.17

 

Diluted

 

$

(0.23

)

$

0.17

 

 



 

LOGITECH INTERNATIONAL S.A.

 

(In thousands, except per share amounts) - Unaudited

 

 

 

Twelve Months Ended March 31,

 

CONSOLIDATED STATEMENTS OF OPERATIONS

 

2013

 

2012

 

 

 

 

 

 

 

Net sales

 

$

2,099,883

 

$

2,316,203

 

Cost of goods sold

 

1,392,581

 

1,539,614

 

Gross profit

 

707,302

 

776,589

 

% of net sales

 

33.7

%

33.5

%

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

Marketing and selling

 

431,598

 

423,854

 

Research and development

 

153,922

 

162,331

 

General and administrative

 

113,824

 

118,423

 

Impairment of goodwill and other assets

 

216,688

 

 

Restructuring charges

 

43,704

 

 

Total operating expenses

 

959,736

 

704,608

 

 

 

 

 

 

 

Operating income (loss)

 

(252,434

)

71,981

 

 

 

 

 

 

 

Interest income, net

 

907

 

2,674

 

Other income (expense), net

 

(2,198

)

16,622

 

 

 

 

 

 

 

Income (loss) before income taxes

 

(253,725

)

91,277

 

Provision for (benefit from) income taxes

 

(25,588

)

19,819

 

 

 

 

 

 

 

Net income (loss)

 

$

(228,137

)

$

71,458

 

 

 

 

 

 

 

Shares used to compute net income (loss) per share:

 

 

 

 

 

Basic

 

158,468

 

174,648

 

Diluted

 

158,468

 

175,591

 

Net income (loss) per share:

 

 

 

 

 

Basic

 

$

(1.44

)

$

0.41

 

Diluted

 

$

(1.44

)

$

0.41

 

 



 

LOGITECH INTERNATIONAL S.A.

 

(In thousands) - Unaudited

 

CONSOLIDATED BALANCE SHEETS

 

March 31, 2013

 

March 31, 2012

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

Cash and cash equivalents

 

$

333,824

 

$

478,370

 

Accounts receivable

 

179,565

 

223,104

 

Inventories

 

261,083

 

297,072

 

Other current assets

 

57,036

 

65,990

 

Assets held for sale

 

13,002

 

 

Total current assets

 

844,510

 

1,064,536

 

Non-Current assets

 

 

 

 

 

Property, plant and equipment

 

87,649

 

94,884

 

Goodwill

 

340,132

 

560,523

 

Other intangible assets

 

26,024

 

53,518

 

Other assets

 

75,796

 

83,033

 

Total assets

 

$

1,374,111

 

$

1,856,494

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

Accounts payable

 

$

265,995

 

$

301,111

 

Accrued liabilities

 

185,848

 

186,680

 

Liabilities held for sale

 

1,342

 

 

Total current liabilities

 

453,185

 

487,791

 

Non-current liabilities

 

187,222

 

218,462

 

Total liabilities

 

640,407

 

706,253

 

 

 

 

 

 

 

Shareholders’ equity

 

733,704

 

1,150,241

 

 

 

 

 

 

 

Total liabilities and shareholders’ equity

 

$

1,374,111

 

$

1,856,494

 

 



 

LOGITECH INTERNATIONAL S.A.

 

(In thousands) - Unaudited

 

 

 

Three Months Ended March 31,

 

CONSOLIDATED STATEMENTS OF CASH FLOWS

 

2013

 

2012

 

 

 

 

 

 

 

Cash flows from operating activities:

 

 

 

 

 

Net income (loss)

 

$

(35,914

)

$

28,286

 

Non-cash items included in net income (loss):

 

 

 

 

 

Depreciation

 

10,558

 

10,767

 

Amortization of other intangible assets

 

5,159

 

6,325

 

Impairment of goodwill and other assets

 

5,688

 

 

Investment impairment

 

 

 

Inventory valuation adjustment

 

4,970

 

 

Share-based compensation expense

 

6,539

 

8,149

 

Gain on disposal of property and plant

 

 

(4,063

)

Loss on sale of investments

 

 

9

 

Excess tax benefits from share-based compensation

 

 

(4

)

Deferred income taxes and other

 

2,154

 

1,135

 

Changes in assets and liabilities, net of acquisitions:

 

 

 

 

 

Accounts receivable

 

86,238

 

92,371

 

Inventories

 

18,632

 

(901

)

Other assets

 

1,012

 

7,232

 

Accounts payable

 

(75,962

)

(78,351

)

Accrued liabilities

 

(16,280

)

(28,981

)

Net cash provided by operating activities

 

12,794

 

41,974

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

Purchases of property, plant and equipment

 

(7,208

)

(16,390

)

Investment in privately-held company

 

(450

)

 

Proceeds from sale of property and plant

 

 

4,063

 

Purchases of trading investments

 

(1,902

)

(1,928

)

Proceeds from sales of trading investments

 

2,154

 

1,879

 

Net cash used in investing activities

 

(7,406

)

(12,376

)

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

Payment of cash dividends

 

 

 

Purchases of treasury shares

 

 

(82,902

)

Proceeds from sale of shares upon exercise of options and purchase rights

 

7,139

 

7,739

 

Tax withholdings related to net share settlements of restricted stock units

 

(380

)

(76

)

Excess tax benefits from share-based compensation

 

 

4

 

Net cash provided by (used) in financing activities

 

6,759

 

(75,235

)

 

 

 

 

 

 

Effect of exchange rate changes on cash and cash equivalents

 

(322

)

674

 

Net increase (decrease) in cash and cash equivalents

 

11,825

 

(44,963

)

Cash and cash equivalents at beginning of period

 

321,999

 

523,333

 

Cash and cash equivalents at end of period

 

$

333,824

 

$

478,370

 

 



 

LOGITECH INTERNATIONAL S.A.

 

(In thousands) - Unaudited

 

 

 

Twelve Months Ended March 31,

 

CONSOLIDATED STATEMENTS OF CASH FLOWS

 

2013

 

2012

 

 

 

 

 

 

 

Cash flows from operating activities:

 

 

 

 

 

Net income (loss)

 

$

(228,137

)

$

71,458

 

Non-cash items included in net income (loss):

 

 

 

 

 

Depreciation

 

44,419

 

45,968

 

Amortization of other intangible assets

 

23,073

 

26,534

 

Impairment of goodwill and other assets

 

216,688

 

 

Investment impairment

 

3,600

 

 

Inventory valuation adjustment

 

4,970

 

34,074

 

Share-based compensation expense

 

25,198

 

31,529

 

Gain on disposal of property and plant

 

 

(8,967

)

Gain on sale of investments

 

(831

)

(6,109

)

Excess tax benefits from share-based compensation

 

(26

)

(37

)

Deferred income taxes and other

 

11,552

 

137

 

Changes in assets and liabilities, net of acquisitions:

 

 

 

 

 

Accounts receivable

 

44,928

 

29,279

 

Inventories

 

20,076

 

(36,621

)

Other assets

 

(1,189

)

(4,621

)

Accounts payable

 

(36,289

)

3,622

 

Accrued liabilities

 

(11,042

)

9,896

 

Net cash provided by operating activities

 

116,990

 

196,142

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

Purchases of property, plant and equipment

 

(46,945

)

(47,807

)

Acquisitions, net of cash acquired

 

 

(18,814

)

Investment in privately-held companies

 

(4,420

)

 

Proceeds from sale of property and plant

 

 

8,967

 

Proceeds from sale of available-for-sale securities

 

917

 

6,550

 

Purchases of trading investments

 

(4,196

)

(7,505

)

Proceeds from sales of trading investments

 

4,463

 

7,399

 

Net cash used in investing activities

 

(50,181

)

(51,210

)

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

Payment of cash dividends

 

(133,462

)

 

Purchases of treasury shares

 

(89,955

)

(156,036

)

Proceeds from sale of shares upon exercise of options and purchase rights

 

15,982

 

17,591

 

Tax withholdings related to net share settlements of restricted stock units

 

(2,375

)

(966

)

Excess tax benefits from share-based compensation

 

26

 

37

 

Net cash used in financing activities

 

(209,784

)

(139,374

)

 

 

 

 

 

 

Effect of exchange rate changes on cash and cash equivalents

 

(1,571

)

(5,119

)

Net increase (decrease) in cash and cash equivalents

 

(144,546

)

439

 

Cash and cash equivalents at beginning of period

 

478,370

 

477,931

 

Cash and cash equivalents at end of period

 

$

333,824

 

$

478,370

 

 



 

LOGITECH INTERNATIONAL S.A.

 

(In thousands, except per share amounts) - Unaudited

 

 

 

Quarter Ended

 

Twelve Months Ended

 

 

 

March 31,

 

March 31,

 

SUPPLEMENTAL FINANCIAL INFORMATION

 

2013

 

2012

 

2013

 

2012

 

 

 

 

 

 

 

 

 

 

 

Depreciation

 

$

10,558

 

$

10,767

 

$

44,419

 

$

45,968

 

Amortization of other intangible assets

 

5,159

 

6,325

 

23,073

 

26,534

 

Capital expenditures

 

7,208

 

16,390

 

46,945

 

47,807

 

Impairment of goodwill and other assets

 

5,688

 

 

216,688

 

 

Restructuring charges

 

15,506

 

 

43,704

 

 

 

 

 

 

 

 

 

 

 

 

Total operating expenses - GAAP

 

$

194,238

 

$

170,146

 

$

959,736

 

$

704,608

 

Less: Impairment of goodwill and other assets

 

5,688

 

 

216,688

 

 

Less: Restructuring charges

 

15,506

 

 

43,704

 

 

Total operating expenses before impairment of goodwill and other assets and restructuring charges - Non-GAAP

 

$

173,044

 

$

170,146

 

$

699,344

 

$

704,608

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss) - GAAP

 

$

(37,280

)

$

23,741

 

$

(252,434

)

$

71,981

 

Less: Impairment of goodwill and other assets

 

5,688

 

 

216,688

 

 

Less: Restructuring charges

 

15,506

 

 

43,704

 

 

Operating income (loss) before impairment of goodwill and other assets and restructuring charges - Non-GAAP

 

$

(16,086

)

$

23,741

 

$

7,958

 

$

71,981

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes - GAAP

 

$

(34,886

)

$

30,688

 

$

(253,725

)

$

91,277

 

Less: Impairment of goodwill and other assets

 

5,688

 

 

216,688

 

 

Less: Restructuring charges

 

15,506

 

 

43,704

 

 

Income (loss) before income taxes and impairment of goodwill and other assets and restructuring charges - Non-GAAP

 

$

(13,692

)

$

30,688

 

$

6,667

 

$

91,277

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) - GAAP

 

$

(35,914

)

$

28,286

 

$

(228,137

)

$

71,458

 

Less: Impairment of goodwill and other assets

 

5,688

 

 

216,688

 

 

Less: Restructuring charges

 

15,506

 

 

43,704

 

 

Net income (loss) before impairment of goodwill and other assets and restructuring charges - Non-GAAP

 

$

(14,720

)

$

28,286

 

$

32,255

 

$

71,458

 

 

 

 

 

 

 

 

 

 

 

Net sales by channel:

 

 

 

 

 

 

 

 

 

Retail

 

$

407,690

 

$

455,398

 

$

1,821,657

 

$

1,982,783

 

OEM

 

32,493

 

40,993

 

141,186

 

185,959

 

LifeSize

 

28,904

 

35,571

 

137,040

 

147,461

 

Total net sales

 

$

469,087

 

$

531,962

 

$

2,099,883

 

$

2,316,203

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net retail sales by product family(**):

 

 

 

 

 

 

 

 

 

Retail - Pointing Devices

 

$

128,809

 

$

132,335

 

$

521,083

 

$

559,366

 

Retail - Keyboards & Desktops

 

105,596

 

101,458

 

407,896

 

404,298

 

Retail - Tablet Accessories

 

30,783

 

7,128

 

119,804

 

43,693

 

Retail - Audio - PC

 

57,039

 

70,964

 

271,197

 

309,896

 

Retail - Audio - Wearables & Wireless

 

8,542

 

14,069

 

65,826

 

53,140

 

Retail - Video

 

41,063

 

50,017

 

179,340

 

216,387

 

Retail - PC Gaming

 

23,618

 

41,109

 

142,184

 

170,948

 

Retail - Remotes

 

11,382

 

16,895

 

71,641

 

91,000

 

Retail - Other

 

858

 

21,423

 

42,686

 

134,055

 

Total net retail sales

 

$

407,690

 

$

455,398

 

$

1,821,657

 

$

1,982,783

 

 


* * Certain products within the retail product families as presented in prior years have been reclassified to conform to the current year presentation, with no impact on previously reported total net retail sales.

 

 

 

Quarter Ended

 

Twelve Months Ended

 

 

 

March 31,

 

March 31,

 

Share-based Compensation Expense(*)

 

2013

 

2012

 

2013

 

2012

 

 

 

 

 

 

 

 

 

 

 

Cost of goods sold

 

$

398

 

$

562

 

$

2,499

 

$

3,620

 

Marketing and selling

 

2,447

 

3,371

 

7,825

 

12,716

 

Research and development

 

1,513

 

1,823

 

7,532

 

7,187

 

General and administrative

 

2,181

 

2,393

 

7,342

 

8,006

 

Income tax benefit

 

(1,266

)

(1,699

)

(5,356

)

(6,294

)

Total share-based compensation expense after income taxes

 

$

5,273

 

$

6,450

 

$

19,842

 

$

25,235

 

 

 

 

 

 

 

 

 

 

 

Share-based compensation expense net of tax, per share (diluted)

 

$

0.03

 

$

0.04

 

$

0.13

 

$

0.14

 

 


* Share-based compensation expense for the quarter ended March 31, 2013 and twelve months ended March 31, 2013 includes a reduction of $0 and $2.2m in expense applicable to employees terminated as a result of the restructuring plans announced in April 2012 and March 2013.

 

Constant dollar sales (sales excluding impact of exchange rate changes) and Non-GAAP operating income (loss), income (loss) before income taxes and net income (loss) (excluding the FY 2013 impairment and restructuring charges)

 

We refer to our net sales excluding the impact of foreign currency exchange rates as constant dollar sales. We also report non-GAAP operating expenses, operating income (loss), income (loss) before income taxes and net income (loss) in this press release and related materials, excluding the FY 2013 impairment of goodwill and other assets and restructuring charges. Constant dollar sales and non-GAAP operating expenses, operating income (loss), income (loss) before income taxes and net income (loss) are non-GAAP financial measures, which are 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, operating expenses, operating income (loss), income (loss) before income taxes and net income (loss). 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. Non-GAAP operating expenses, operating income (loss), income (loss) before income taxes and net income (loss) before impairment of goodwill and other assets and restructuring charges can be reconciled to GAAP operating expenses, operating income (loss), income (loss) before income taxes and net income (loss), respectively, by adding the amount of the impairment and restructuring charges.