Logitech Q3 Profit Up 31%, Beats View; Lowers 2015 Sales Outlook

(RTTNews) - Computer interface devices maker Logitech International S.A. (LOGI) on Wednesday reported a 31 percent increase in profit for the third quarter from last year, reflecting a slight increase in revenues and higher margins.

Adjusted earnings per share for the quarter beat analysts' expectations. Looking ahead to fiscal 2015, Logitech raised its forecast for adjusted operating income, but lowered its sales outlook, citing a stronger U.S. dollar.

Bracken Darrell, Logitech president and chief executive officer said, "Overall, despite the U.S. dollar's strengthening, our retail sales and profitability continued to grow and we generated robust cash flow. Based on these better-than-expected results and the strength of our product offerings, we have increased our full-year outlook for operating income for the second time this fiscal year."

The Switzerland-based company reported net income for the third quarter of $62.78 million or $0.38 per share, up from $47.88 million or $0.29 per share in the prior-year quarter.

Excluding items, adjusted net income for the quarter was $68.28 million or $0.41 per share, compared to $57.33 million or $0.35 per share in the year-ago quarter.

On average, five analysts polled by Thomson Reuters expected the company to report earnings of $0.32 per share for the quarter. Analysts' estimates typically exclude special items.

Net sales for the quarter rose 1 percent to $634.20 million from $628.72 million in the same quarter last year. Analysts had a consensus revenue estimate of $622.48 million.

Net sales through retail channel grew 2 percent from the year-ago period to $574.03 million. Excluding the unfavorable impact of currency exchange rates, retail sales grew 5 percent.

Meanwhile, sales to OEMs decreased 12 percent from the year-ago quarter to $30.30 million, while sales for video conferencing or LifeSize Communications, acquired in December 2009, edged down slightly to $29.88 million.

Among the product families sold through retail channel, PC Gaming retail sales rose 21 percent to $70.19 million, while Tablet & Other Accessories sales declined 28 percent to $55.10 million. Mobile Speakers retail sales surged 82 percent to $62.26 million.

"We almost doubled sales in Mobile Speakers and also posted healthy growth in PC Gaming and Video Collaboration," Darrell stated.

Gross profit margin expanded 210 basis points from last year to 36.5 percent, while operating margin for the increased 180 basis points to 10.2 percent.

Looking ahead to fiscal 2015, Logitech now forecasts adjusted operating income of about $185 million, up from the prior forecast of about $170 million.

However, the company lowered its outlook for full-year sales to about $2.11 billion from the prior forecast of about $2.16 billion, to reflect the U.S. dollar's appreciation compared to various other currencies. Street expects the company to report revenues of $2.13 billion.

LOGI closed Wednesday's trading at $14.09, up $0.11 or 0.75 percent on a volume of 532,643 shares.