Earnings Per Share Up Over 20%; Company Beats Three-Year Non-GAAP EPS
Goal A Full Year Early

LAUSANNE, Switzerland & NEWARK, Calif.–(BUSINESS WIRE)–Logitech International (SIX: LOGN) (Nasdaq: LOGI) today announced
financial results for the fourth quarter and full year of Fiscal Year
2019, ended March 31, 2019.

For Fiscal Year 2019:

• Sales were the highest ever at $2.79 billion, up 9 percent in US
  dollars and 10 percent in constant currency compared to the prior
  year, the sixth consecutive year of growth.
• GAAP operating income grew 15 percent to $263 million, compared to
  $230 million a year ago. GAAP earnings per share (EPS) grew 24 percent
  to $1.52, compared to $1.23 a year ago.
• Non-GAAP operating income grew 23 percent to $352 million, compared to
  $287 million a year ago. Non-GAAP EPS grew 26 percent to $2.01,
  compared to $1.60 a year ago.

For Q4 Fiscal Year 2019:

• Sales grew to $624 million, up 5 percent in US dollars and 9 percent
  in constant currency compared to Q4 of the prior year.
• GAAP operating income grew 8 percent to $42 million, and non-GAAP
  operating income grew 16 percent to $64 million, compared to Q4 of the
  prior year.

“We’ve delivered our third consecutive year of double-digit growth in
constant currency and our highest fiscal year sales ever,” said Bracken
Darrell, Logitech president and chief executive officer. “Our
innovative, diverse product portfolio delivered, led by strong,
sustainable growth in our major categories of Gaming, Video
Collaboration, and Creativity & Productivity. And we are not just
growing topline, but also systematically delivering strong leverage on
the bottom line. In fact, we achieved our plan to double non-GAAP EPS to
$2.00 a full year early. Our strategy is working, and we are excited for
our future as the world’s leading cloud peripheral company.”

Outlook

Logitech confirmed its Fiscal Year 2020 outlook of mid to high
single-digit sales growth in constant currency and $375 million to $385
million in non-GAAP operating income.

Management Update

Additionally, Logitech announced today that Vincent Pilette, Logitech’s
chief financial officer, is leaving the Company. Vincent will leave, and
cease to be a member of the Group Management Team, at the end of May,
2019, to pursue a senior leadership role at another company. Logitech
has named Nate Olmstead interim chief financial officer following
Vincent’s departure. Nate joined Logitech in 2019 as vice president of
finance, and brings over 16 years of financial management experience,
most recently as the vice president of finance for global operations at
Hewlett Packard Enterprise. Nate has a BA from Stanford and an MBA from
Harvard.

“When I joined Logitech, I had a vision to turn Logitech into a design
company, pursuing opportunities in the many new market opportunities
enabled by the cloud,” said Bracken Darrell. “We needed financial and
operational strength to support the ambition of that vision. Vincent has
been a terrific partner for this pursuit these past six years, and we’ve
made great progress. But more important than his partnership and
leadership is the team he built and the culture of rigor and discipline
he helped instill throughout the company. We now have a strong, seasoned
finance team across every area and a proven track record of operational
excellence. That is his most important legacy. I’m excited for him in
his next challenge. And I’m even more energized by our continued
progress toward our design company vision.”

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 Q4 and the full Fiscal Year 2019 on Tuesday, April 30, 2019
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), loss (gain) 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 2020.

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,
Blue
Microphones, ASTRO
Gaming and Logitech
G. 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 and full fiscal year ended March 31, 2019, innovation, product
portfolio, brand leadership, growth, profitability and leverage,
sustainability, market leadership, position for the future, focus,
vision ability to be a design company, outlook for Fiscal Year 2020
operating income and sales growth, and our executive officers. 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 we are not able to maintain and enhance
our brands; 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 and our
ability to mitigate; 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 and our Quarterly Report
on Form 10-Q for the fiscal quarter ended December 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.

*Note: These preliminary results for the three months and fiscal year
ended March 31, 2019 are subject to adjustments, including subsequent
events that may occur through the date of filing our Annual Report on
Form 10-K.

(A) Adoption of ASC Topic 606

On April 1, 2018, we adopted the new revenue standards under Accounting
Standards Codification (“ASC”) Topic 606. The adoption of Topic 606 did
not have an impact over the total cash flows from operating, investing,
or financing activities. The following tables summarize the impacts of
adopting Topic 606 on our condensed consolidated statements of
operations for the three months and fiscal year ended March 31, 2019 and
condensed consolidated balance sheets as of March 31, 2019 (in
thousands):

(B) Non-GAAP Financial Measures

To supplement our condensed consolidated financial results prepared in
accordance with GAAP, we use a number of financial measures, both GAAP
and non-GAAP, in analyzing and assessing our overall business
performance, for making operating decisions and for forecasting and
planning future periods. We consider the use of non-GAAP financial
measures helpful in assessing our current financial performance, ongoing
operations and prospects for the future as well as understanding
financial and business trends relating to our financial condition and
results of operations.

While we use non-GAAP financial measures as a tool to enhance our
understanding of certain aspects of our financial performance and to
provide incremental insight into the underlying factors and trends
affecting both our performance and our cash-generating potential, we do
not consider these measures to be a substitute for, or superior to, the
information provided by GAAP financial measures. Consistent with this
approach, we believe that disclosing non-GAAP financial measures to the
readers of our financial statements provides useful supplemental data
that, while not a substitute for GAAP financial measures, can offer
insight in the review of our financial and operational performance and
enables investors to more fully understand trends in our current and
future performance. In assessing our business during the quarter ended
March 31, 2019 and previous periods, we excluded items in the following
general categories, each of which are described below:

Share-based compensation expenses. We believe that providing
non-GAAP measures excluding share-based compensation expense, in
addition to the GAAP measures, allows for a more transparent comparison
of our financial results from period to period. We prepare and maintain
our budgets and forecasts for future periods on a basis consistent with
this non-GAAP financial measure. Further, companies use a variety of
types of equity awards as well as a variety of methodologies,
assumptions and estimates to determine share-based compensation expense.
We believe that excluding share-based compensation expense enhances our
ability and the ability of investors to understand the impact of
non-cash share-based compensation on our operating results and to
compare our results against the results of other companies.

Amortization of intangible assets. We incur intangible asset
amortization expense, primarily in connection with our acquisitions of
various businesses and technologies. The amortization of purchased
intangibles varies depending on the level of acquisition activity. We
exclude these various charges in budgeting, planning and forecasting
future periods and we believe that providing the non-GAAP measures
excluding these various non-cash charges, as well as the GAAP measures,
provides additional insight when comparing our gross profit, operating
expenses, and financial results from period to period.

Contacts

Ben Lu
Vice President, Investor Relations – USA
+1 (510)
713-5568

Krista Todd
Vice President, Global Communications – USA
+1
(510) 713-5834

Ben Starkie
Corporate Communications – Europe
+41 (0)
79-292-3499

Read full story here