14 DAY TRIAL // Like most other IT companies, Logitech is reporting on the state of its finances and how they progressed, or regressed as the case may be, during the second quarter of the year.
We should preface this by saying that Logitech did not report on the second quarter of 2012, but on the first quarter of its Fiscal Year 2013.
That the period coincides with the April 1-July 30 period is a fortuitous coincidence for us, since it minimizes confusion.
At any rate, Logitech says that Q1 FY 2013 results are consistent with its expectations, but that makes things sound better than they are.
We already have experience with such statements, of course. SanDisk has recently met its expectations as well, but that only meant that revenues plummeted as much as the company feared.
That said, Logitech's sales in Q1 FY 2013 were $469 million, down 2% on quarter. That's about 386 million Euro.
Compared to the prior year, the results were flat (after adjusting for the negative impact of exchange rates).
The operating loss was of $59 million / 48.5 million Euro, while a restructuring charge of $31 million / 25.52 million added to the final results.
OEM sales were the main ones responsible for this outcome. While retail sales maintained the same level year-over-year, retail suffered a drop of 25%.
“We are in the middle of our turnaround, with most of the plans we put in place in past quarters expected to bear fruit beginning in the second half of FY 2013. And we incurred several one-time charges in the first quarter that are expected to positively impact future profitability,” said Guerrino De Luca, Logitech chairman and chief executive officer.
Despite the loss, Luca is pleased with the performance of their newest products and has high hopes for music, tablet, touch-based navigation and digital home-related devices.
“I’m also very pleased by the strong initial sales of the new generation of products recently added to our portfolio, such as the Logitech Ultrathin Keyboard Cover and our wireless speakers for digital music,” he said.
“The majority of our new products, targeting consumer trends in music, tablets, touch-based navigation and the digital home, will be launched in Q2 and early Q3, as we prepare for the holiday selling season. In addition to strengthening our product portfolio, we continue to expect to benefit from the simplification of our organization and processes, and cost savings from the restructuring.”