Logitech International S.a. · SIX:LOGN
Logitech International — Q4 FY2018 Earnings Presentation
24 slides from Logitech International's earnings presentation, May 3, 2018
Slide 1: Q4 Fiscal Year 2018 Financial Results
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Slide 2: Forward-looking statements
This presentation includes 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, 2018, vision of our future company and abilities,
Slide 3: Key Messages - Q4 FY 2018
KEY MESSAGES —- @4 FY 2018 Consistent performance, with Q4 sales up 9% (CC) and 16% on a USS basis to $592M Strong double-digit sales growth in Gaming, Video Collaboration, and Tablet & Accessories offset a market slowdown in Mobile Speakers Gross margin recovered sequentially to 36.4%, enabling us
Slide 4: Key Messages - Fiscal Year 2018
KEY MESSAGES — FISCAL YEAR 2018 Fifth consecutive year of growth, with sales up 13% (CC) and 16% on a USS basis toa record $2.6B Broad-based performance with all regions and our key markets delivering growth, while ASTRO Gaming added two points to our full year sales growth Gross margin of 35.9% was
Slide 5: What's New from Logitech
Slide 6: Gaming
GAMING Logitech G560 is a gaming speaker system that synchronizes RGB lighting and audio to match on-screen gameplay Our RGB SDK allows developers to customize color and animation effects for popular game titles Light and animation effects can be customized across nearly 17 million colors, with four
Slide 7: Gaming
GAMING ao Logitech G513 is a high performance \\) gaming keyboard, delivering 1 ms report Mu / td rate and featuring a choice of advanced , Ty = Romer-G Tactile or Romer-G Linear d ‘Ab », ey , & =z = mechanical switch A 7 Qe a Full-spectrum RGB combined with y hon LY oy “A LIGHTSYNC technology offer
Slide 8: Gaming
GAMING Logitech G PRO Headset is designed in collaboration with the world's top gaming professionals Made with the highest quality materials and advanced technologies to provide superior audio performance Premium leatherette ear pads offer up to 50% more sound isolation than other ear pads Comes wit
Slide 9: Tablet & Accessories
TABLET & ACCESSORIES Logitech Crayon is a versatile, pixel- precise digital pencil for K-12 classroom Delivers zero perceptible lag time that makes writing as natural as pen and paper Offers palm rejection on the iPad for natural hand placement Has a smart tip that dynamically adjusts line weight de
Slide 10: Mobile Speakers
MOBILE SPEAKERS Ultimate Ears recently announced new features coming to our portable Wi-Fi & Bluetooth speakers, MEGABLAST and BLAST Consumers will be able to use their voice to control Spotify on MEGABLAST and BLAST Spotify Connect will also be available over Wi-Fi without the need to pair through
Slide 11: Financial Results
FINANCIAL RESULTS
Slide 12: FY 2018 Results Demonstrate Sustained Growth
FY 2018 RESULTS DEMONSTRATE SUSTAINED GROWTH YoY % chg (USS) 16% YoY % chg (CC) 9% Gross profit 216 8% % margin 36.4% (280 bps) Operating expense 161 7% % of sales 27.1% (220 bps) % margin 9.3% (60 bps) Net income 55 1% % margin 9.2% (50 bps) Earnings per share $0.32 7% Diluted shares 169 $592 16% $
Slide 13: Robust Gains from Several Key Categories
ROBUST GAINS FROM SEVERAL KEY CATEGORIES ee Ce PC Peripherals +1% (CC), consistent Pointing Devices 9% 3% 1% with a stable PC market Keyboards & Combos 137 14% 7% 498 4% 2% Gaming +52% (CC) its 5th straight , PC Webcams 32 18% = 12% 112 5% =—-3% year of double-digit growth Tablet & Accessories 27 56
Slide 14: Broad-Based Growth from All Three Regions
BROAD-BASED GROWTH FROM ALL THREE REGIONS ) JL sss by double-digit growth in PC Americas 10% 9% 16% Peripherals, Gaming, and Video EMEA 198 170 16% 2% 21% Collaboration, offsetting a decline in Asia Pacific 26% 21% 29% Mobile Speakers Net sal 92 11 % 9% EMEA soles 42% (CC) and +16% (USS) Sales growt
Slide 15: Q4'18 Gross Margin Within Target Range
Q4'18 GROSS MARGIN WITHIN TARGET RANGE 40% 4 39% 38% 37% 36% 35% 34% 33% 32% Non-GAAP Gross Margin Benefit from Qi7 Q2'17 breakage! 1g) —~_] Q3'17 Q417 Note: Figures are for illustrative purposes only. (1) @4'17 non-GAAP gross margin includes the first-time implementation of a breakage model for EME
Slide 16: FY 2018 Opex-to-Sales Ratio Reached 9-Year Low
FY 2018 OPEX-TO-SALES RATIO REACHED 9-YEAR LOW Sales & marketing 05 10% % of sales 17.7% (110 bps) 16.3% (10 bps) Research & development 36 1% 137 9% % of sales 6.1% (30 bps) 5.4% (30 bps) General & administrative 19 (8%) 80 (6%) % of sales 3.3% (80 bps) 3.1% (70 bps) % of sales 27.1% (220 bps) 24.7
Slide 17: Highest Full Year Cash Flow in Years
HIGHEST FULL YEAR CASH FLOW IN 8 YEARS Pf ats | vor | Enka Cash flow from operations +20% to $346M, the highest level in 8 years Cash flow from operations 90 89% (1) 20% lancling eedh baller CB tks CB | Cash conversion cycle improved to 22 Inventory 260 3% 260 3% days, in line with our annual target
Slide 18: Fiscal Year 2019 Outlook
FISCAL YEAR 2019 OUTLOOK OUTLOOK Net sales growth High single-digit CC Non-GAAP operating income $310 - 320M ASSUMPTIONS Currency FY 2018 average rates Non-GAAP effective tax rate 7-8% Cash from operations 1x non-GAAP operating income Capex ~$50M Note: Comparisons are YoY unless otherwise specified.
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Slide 20: GAAP to Non-GAAP Reconciliations
GAAP TO NON-GAAP RECONCILIATIONS PRELIMINARY RESULTS (In thousands, except per share amounts) - Unaudited GAAP TO NON GAAP RECONCILIATION “ Three Months Ended Fiscal Years Ended March 31 March 31 SUPPLEMENTAL FINANCIAL INFORMATION 2018 2017 2018 2017 Gross profit - GAAP $212,235 $197,779 $909,241 $
Slide 21: GAAP to Non-GAAP Reconciliations
GAAP TO NON-GAAP RECONCILIATIONS PRELIMINARY RESULTS (In thousands, except per share amounts) - Unaudited GAAP TO NON GAAP RECONCILIATION “ Three Months Ended —_—Fiscal Years Ended March 31 March 31 SUPPLEMENTAL FINANCIAL INFORMATION 2018 2017 2018 2017 Operating income » GAAP $ 39,107 $36,318 $ 229
Slide 22: GAAP to Non-GAAP Reconciliation Notes
GAAP TO NON-GAAP RECONCILIATION NOTES Note: These preliminary results for the three months and fiscal year ended March 31, 2018 are subject to adjustments, including subsequent events that may occur through the date of filing our Annual Report on Form 10-K. (A) Non-GAAP Financial Measures To supplem
Slide 23: Sell-Through Data
SELL-THROUGH DATA Measures sales of our products by retailer customers to consumers and by our distributor customers to their customers Compiled by Logitech from data supplied by our customers Customers supplying sell-through data vary by geographic region and from period to period, but typically re
Slide 24: Logitech
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