Logitech International S.a. · SIX:LOGN
Logitech International — Investor Day (March 2017)
17 slides from Logitech International's investor day presentation, Mar 7, 2017
Slide 1: Financials
FINANCIALS VINCENT PILETTE CFO
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This presentation includes forward-looking statements within the meaning of the U.S. f ederal securities laws, including, without limitation, statements regarding: projected return, innovation, growth, growth methods, product category sales and growth, optimizing operation
Slide 3: Focusing on Shareholder Value
FOCUSING ON SHAREHOLDER VALUE % 4Y Return 1Y Return LOGI 367% 95% S&P 500 70% 24% NASDAQ 95% 29% SMI 13% 8% Years Total return calculated f rom February 28, 2013 to February 27, 2017 Source: Factset
Slide 4: EMEA Market Marching Towards Sustainable Growth
EMEA MARKET MARCHING TOWARDS SUSTAINABLE GROWTH SUSTAINABLE GROWTH FOCUSING ON GROWTH TRANSFORMING PORTFOLIO OPERATIONAL FOUNDATION
Slide 5: 4th Year of Sales Growth
4TH YEAR OF SALES GROWTH 12-13% Adjacency entry 9% Market share gain Innovative new products 3 Ways to Distribution expansion Grow 4% 2% Market growth FY14 FY15 FY16 * FY17E Retail sales CC growth Estimates using mid-point of FY17 outlook CC = constant currency Comparisons are YoY unless otherwise s
Slide 6: Accelerating Performance FY17
ACCELERATING PERFORMANCE FY17 Revenue growth 9-10% organic retail sales growth CC ~3% retail sales growth from acquisition Earnings expansion ~36.5% gross margin ~$227M operating income (+27%) ~10.5% operating profit margin Capital allocations $67M acquisition $93M dividends (+10%) ~$85M share buyba
Slide 7: Diversified Portfolio Sustains Growth
DIVERSIFIED PORTFOLIO SUSTAINS GROWTH GAMING SMART HOME +25% +2% MUSIC +25% CREATIVITY & PRODUCTIVITY +4% +35% VIDEO COLLABORATION Estimates using mid-point of FY17 outlook Sales growth in constant currency Comparisons are YoY unless otherwise specif ied
Slide 8: Endless Possibilities
DESIGN ENGINEERING GO-TO-MARKET MARKETING OPERATIONS ENDLESS POSSIBILITIES
Slide 9: Operational Efficiency Opportunities
OPERATIONAL EFFICIENCY OPPORTUNITIES High Video Collaboration Audio PC & Optimizing Wearables Gaming Scaling Mobile Sales Growth Speakers Keyboards & Accelerating Combos Strategic PC Webcams Smart Home Pointing Low Devices Tablet Low Operational Metrics High Represents corporate average
Slide 10: Sustaining Gross Margin Expansion
SUSTAINING GROSS MARGIN EXPANSION 1.2% (1.3%) 2.3% 2 3 ~36.5% 1 Cost savings from price negotiations and design for cost program 1 0.6% (0.1%) 33.9% Efficiency gains from 2 higher volume and manufacturing automation Gross profit funding 3 investment to support growth FY16 OEM Product Material Supply
Slide 11: Investing for Growth
INVESTING FOR GROWTH Non-GAAP opex as % of retail sales FY13 FY17E LONG TERM R&D 6% 6% ~6% Investing in technology and products S&M 18% 16% ~15% Leveraging sales distribution G&A >5% 4% <4% Building up marketing capabilities OpEx 29% ~26% ~25% Driving infrastructure efficiencies Estimates using mid-
Slide 12: FY18 Outlook
FY18 OUTLOOK Sales CC growth High single digit Non-GAAP operating income $250 - 260M ASSUMPTIONS Currency FY17 average rates Non-GAAP effective tax rate ~9% Cash from operations ~1x non-GAAP operating income Capex ~$50M CC = constant currency
Slide 13: FY18 Growth Expectations
FY18 GROWTH EXPECTATIONS CC = constant currency Comparisons are YoY unless otherwise specif ied
Slide 14: Sustainable Long Term Business Model
SUSTAINABLE LONG TERM BUSINESS MODEL LONG TERM BUSINESS MODEL 1 Retail sales CC growth High single digit Gross margin 35% or higher Operating expenses 25% or lower 2 Operating margin 10% to 12% Cash from operations 1x operating income Capital allocation Goal of returning 100% of free cash flow throu
Slide 15: Capital Allocation Framework
CAPITAL ALLOCATION FRAMEWORK DEPLOYING AND RETURNING FREE CASH FLOW Consistent Use cash for small or 1 Acquisition medium acquisitions cash generation 2 Dividend Grow dividends annually New $250M opportunistic Share 3 buyback buyback approval over next 3 years Non-GAAP operating income
Slide 16: FY20 Roadmap to $2 EPS
FY20 ROADMAP TO $2 EPS $0.15 – ($0.45) – $0.20 ($0.50) ~$0.20 ~$0.40 ~$2.00 ~$0.40 ~$1.25 $0.98 FY16 FY17E* Market Share Adjacency Productivity Invest- FY20E non-GAAP non-GAAP growth** gain** entry** gains** ments** non-GAAP EPS EPS EPS *Using mid-point of FY17 non-GAAP outlook **For illustration pu
Slide 17: Logitech
logitech