Logitech Delivers Record FY 2022 Sales – QNT Press Release


Company Reports Ninth Consecutive Year of Growth;

Profits Exceed FY22 Outlook

SIX Swiss Exchange Ad hoc announcement pursuant to Art. 53 LR — Logitech International (SIX: LOGN) (NASDAQ:LOGI) today announced financial results for the fourth quarter and full Fiscal Year 2022, ended March 31, 2022.

For Fiscal Year 2022:

  • Sales were Logitech's highest ever at $5.48 billion, up 4 percent in US dollars and 4 percent in constant currency compared to the prior year. This growth is on top of last year's record sales which grew 76 percent in US dollars and 74 percent in constant currency. The Company's sales have more than doubled in the past four years.
  • GAAP operating income declined 33 percent to $774 million, compared to $1.15 billion a year ago. Non-GAAP operating income declined 29 percent to $904 million, compared to $1.27 billion a year ago. This reflects the Company's planned, strategic investments in marketing and product development to drive future growth, and significantly exceeds its original Fiscal Year 2022 non-GAAP operating income outlook. The Company has more than doubled its non-GAAP operating income versus two years ago.
  • GAAP earnings per share (EPS) declined 31 percent to $3.78, compared to $5.51 a year ago. Non-GAAP EPS declined 28 percent to $4.63, compared to $6.42 a year ago.

For Q4 Fiscal Year 2022:

  • Sales were $1.23 billion, down 20 percent in US dollars and 17 percent in constant currency compared to Q4 of the prior year.
  • GAAP operating income declined 56 percent to $129 million, compared to Q4 of the prior year. Non-GAAP operating income declined 52 percent to $156 million, compared to Q4 of the prior year.

“This year, we sustained our scale, delivering record sales on top of last year's 74% sales growth,” said Bracken Darrell, Logitech president and chief executive officer. “We grew for the ninth straight year and grew market share across the portfolio. We also beat our original profit target by over $100 million.

Despite strong year-over-year results, our focus is the long term. We're riding secular growth trends in hybrid work, video collaboration, esports and digital content creation. We'll continue to deliver against those with agility, operational excellence and a diverse, innovative portfolio. I'm excited for the future.”

Outlook

Logitech reduced its Fiscal Year 2023 outlook, removing the estimate of annual sales and profits that would have been generated in Ukraine and Russia. This reflects the current, uncertain environment in which the war in Ukraine continues without sign of resolution in the near term.

Sales growth in constant currency is now expected to be between 2 and 4 percent, and non-GAAP operating income is expected to be between $875 million and $925 million. Previously, sales growth in constant currency was expected to be in the mid single digits, and non-GAAP operating income was expected to be between $900 million and $950 million.

Prepared Remarks Available Online

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

Financial Results Videoconference and Webcast

Logitech will hold a financial results videoconference to discuss the results for Q4 and the full Fiscal Year 2022 on Tuesday, May 3, 2022 at 8:30 a.m. Eastern Daylight Time and 2:30 p.m. Central European Summer Time. A livestream of the event 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, impairment of intangible assets, acquisition-related costs, change in fair value of contingent consideration for business acquisition, restructuring charges (credits), loss (gain) on investments, 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, a non-GAAP measure, 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 the Fiscal Year 2023 outlook.

Public Dissemination of Certain Information

Logitech webcasts its earnings calls, and certain events Logitech participates in or hosts, with members of the investment community on its investor relations website at https://ir.logitech.com. Additionally, Logitech provides notifications of news or announcements regarding its operations and financial performance, including its filings with the Securities and Exchange Commission (SEC), investor events, and press and earnings releases as part of its investor relations website. Logitech intends to use its investor relations website as means of disclosing material nonpublic information and for complying with its disclosure obligations under Regulation FD. Logitech's corporate governance information also is available on its investor relations website.

About Logitech

Logitech helps all people pursue their passions by designing experiences so everyone can create, achieve, and enjoy more. Logitech designs and creates products that bring people together through computing, gaming, video, streaming and creating, and music. Brands of Logitech include Logitech, Logitech G, ASTRO Gaming, Streamlabs, Blue Microphones and Ultimate Ears. 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 U.S. federal securities laws, including, without limitation, statements regarding: our preliminary financial results for the three months and fiscal year ended March 31, 2022, long-term trends, future performance, and outlook for Fiscal Year 2023 sales growth and non-GAAP operating income, and related assumptions. The forward-looking statements in this press 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 demand variability, supply shortages and other supply chain challenges; 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; the impact of global events, such as COVID-19 pandemic and Russia's military operations in Ukraine, and any associated economic downturn and political instability; changes in inflation levels and in the Federal Reserve's monetary policy; if we do not successfully execute on strategic acquisitions and investments; if we do not efficiently manage our spending; 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 regulations, policies and agreements and the imposition of tariffs that affect our products or operations and our ability to mitigate; risks associated with acquisitions; and the effect of changes to our effective income tax 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 SEC, including our Annual Report on Form 10-K for the fiscal year ended March 31, 2021, our Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2021, and our subsequent reports filed with the SEC, 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

 

Fiscal Years Ended

 

 

March 31,

 

March 31,

GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

 

2022

 

2021

 

2022

 

2021

 

 

 

 

 

 

 

 

 

Net sales

 

$

1,229,994

 

$

1,535,925

 

 

$

5,481,101

 

 

$

5,252,279

 

Cost of goods sold

 

 

733,092

 

 

 

821,127

 

 

 

3,204,072

 

 

 

2,903,215

 

Amortization of intangible assets

 

 

2,995

 

 

 

3,529

 

 

 

14,023

 

 

 

13,329

 

Gross profit

 

 

493,907

 

 

 

711,269

 

 

 

2,263,006

 

 

 

2,335,735

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

Marketing and selling

 

 

247,017

 

 

 

273,764

 

 

 

1,025,899

 

 

 

770,284

 

Research and development

 

 

78,408

 

 

 

69,009

 

 

 

291,844

 

 

 

226,023

 

General and administrative

 

 

36,357

 

 

 

68,236

 

 

 

148,648

 

 

 

166,577

 

Amortization of intangible assets and acquisition-related costs

 

 

2,961

 

 

 

5,178

 

 

 

16,947

 

 

 

19,064

 

Impairment of intangible assets

 

 

 

 

 

 

 

 

7,000

 

 

 

 

Change in fair value of contingent consideration for business acquisition

 

 

 

 

 

 

 

 

(3,509

)

 

 

5,716

 

Restructuring charges (credits), net

 

 

395

 

 

 

 

 

 

2,165

 

 

 

(54

)

Total operating expenses

 

 

365,138

 

 

 

416,187

 

 

 

1,488,994

 

 

 

1,187,610

 

 

 

 

 

 

 

 

 

 

Operating income

 

 

128,769

 

 

 

295,082

 

 

 

774,012

 

 

 

1,148,125

 

Interest income

 

 

451

 

 

 

340

 

 

 

1,246

 

 

 

1,784

 

Other income (expense), net

 

 

2,501

 

 

 

(11,450

)

 

 

560

 

 

 

(1,789

)

Income before income taxes

 

 

131,721

 

 

 

283,972

 

 

 

775,818

 

 

 

1,148,120

 

Provision for income taxes

 

 

23,516

 

 

 

58,225

 

 

 

131,305

 

 

 

200,863

 

Net income

 

$

108,205

 

 

$

225,747

 

 

$

644,513

 

 

$

947,257

 

 

 

 

 

 

 

 

 

 

Net income per share:

 

 

 

 

 

 

 

 

Basic

 

$

0.65

 

 

$

1.34

 

 

$

3.85

 

 

$

5.62

 

Diluted

 

$

0.64

 

 

$

1.31

 

 

$

3.78

 

 

$

5.51

 

 

 

 

 

 

 

 

 

 

Weighted average shares used to compute net income per share:

 

 

 

 

 

 

 

 

Basic

 

 

165,898

 

 

 

168,734

 

 

 

167,447

 

 

 

168,523

 

Diluted

 

 

168,546

 

 

 

172,954

 

 

 

170,414

 

 

 

171,775

 

 

LOGITECH INTERNATIONAL S.A.

PRELIMINARY RESULTS*

(In thousands, except per share amounts) – unaudited

 

 

 

 

 

 

 

March 31,

 

March 31,

CONDENSED CONSOLIDATED BALANCE SHEETS

 

2022

 

2021

 

 

 

 

 

Current assets:

 

 

 

 

Cash and cash equivalents

 

$

1,328,716

 

 

$

1,750,327

 

Accounts receivable, net

 

 

675,604

 

 

 

612,225

 

Inventories

 

 

933,124

 

 

 

661,116

 

Other current assets

 

 

135,478

 

 

 

135,650

 

Total current assets

 

 

3,072,922

 

 

 

3,159,318

 

 

 

 

 

 

Non-current assets:

 

 

 

 

Property, plant and equipment, net

 

 

109,807

 

 

 

114,060

 

Goodwill

 

 

448,175

 

 

 

429,604

 

Other intangible assets, net

 

 

83,779

 

 

 

115,148

 

Other assets

 

 

320,722

 

 

 

324,248

 

Total assets

 

$

4,035,405

 

 

$

4,142,378

 

 

 

 

 

 

Current liabilities:

 

 

 

 

Accounts payable

 

$

636,306

 

 

$

823,233

 

Accrued and other current liabilities

 

 

784,848

 

 

 

858,617

 

Total current liabilities

 

 

1,421,154

 

 

 

1,681,850

 

 

 

 

 

 

Non-current liabilities:

 

 

 

 

Income taxes payable

 

 

83,380

 

 

 

59,237

 

Other non-current liabilities

 

 

132,133

 

 

 

139,502

 

Total liabilities

 

 

1,636,667

 

 

 

1,880,589

 

 

 

 

 

 

Shareholders' equity:

 

 

 

 

Registered shares, CHF 0.25 par value:

 

 

30,148

 

 

 

30,148

 

Issued shares — 173,106 at March 31, 2022 and 2021

 

 

 

 

Additional shares that may be issued out of conditional capitals — 50,000 at March 31, 2022 and 2021

 

 

 

 

Additional shares that may be issued out of authorized capital — 17,311 at March 31, 2022 and 2021

 

 

 

 

Additional paid-in capital

 

 

129,925

 

 

 

129,519

 

Shares in treasury, at cost — 7,855 and 4,799 shares at March 31, 2022 and 2021, respectively

 

 

(632,893

)

 

 

(279,541

)

Retained earnings

 

 

2,975,681

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