Earnings

Logitech Profit Plunges In Fourth Quarter

RTT News,

Computer interface devices manufacturer Logitech International S.A. reported Wednesday that profit for the fourth quarter plunged from last year, hurt by a drop in margins and the weaker than expected demand in EMEA in the second half of the quarter.

Both earnings per share and quarterly revenues missed analysts' expectations. Meanwhile, the company also provides revenue forecast for the full-year 2012, above Street view.

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The Apples, Switzerland-based company reported net income of $2.78 million or $0.02 per share for the fourth quarter, sharply lower than $24.49 million or $0.14 per share in the prior-year quarter.

On average, six analysts polled by Thomson Reuters expected the company to report earnings of $0.06 per share for the fourth quarter. Analysts' estimates typically exclude special items.

Net sales for the quarter increased 4% to $547.62 million from $525.44 million in the same quarter last year, but missed six Wall Street analysts' consensus estimate of $556.18 million. Excluding the favorable impact of currency exchange rate changes, sales grew 3%.

Net sales through retail channel increased 2% to $463.23 million from the year-ago quarter. Retail sales surged 32% in the Asian region and increased 11% in the Americas region, while it declined 17% in Europe, Middle East and Asia or EMEA region.

Sales to OEMs declined 11% to $45.03 million from the prior-year quarter, and LifeSize Communications, acquired in December 2009, contributed total sales of $39.36 million, up 88% from last year.

Among the product families sold through retail channel, all of the products posted sales growth, except audio as well as gaming products, with pointing devices continuing to be the best performing category in terms of contribution, followed by keyboard & desktops.

Operating income for the quarter plunged 87% to $3.64 million from $27.70 million in the prior-year quarter.

Gross margin for the quarter contracted 300 basis points to 32.8% from last year's 35.8%. Total operating expenses were $175.73 million, up from $160.62 million in the year-ago quarter.

For fiscal 2011, the company reported net income of $128.46 million or $0.72 per share, doubling from $64.96 million or $0.36 per share in the prior year. Analysts expected the company to report earnings of $0.76 per share for fiscal 2011.

Net sales for the full year increased 20% to $2.36 billion from $1.97 billion in the previous year. Street was looking for full-year 2011 revenues of $2.37 billion.

"FY 2011 was a strong year for the company, with sales growth of 20% and operating income nearly doubling, driven by our LifeSize division and our Americas and Asia retail regions," President and CEO Gerald Quindlen said in a statement.

Looking ahead to fiscal 2012, the company anticipates sales of about $2.6 billion. Street is currently looking for full-year 2012 revenues of $2.59 billion.

The company also expects full-year operating income of about $185 million, and gross margin of about 35%.

LOGI closed Wednesday's regular trading session at $14.21, up $0.27 or 1.94% on a volume of 1.85 million shares.

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