SANTA CRUZ, Calif.,
Feb. 4, 2020 /PRNewswire/ -- Plantronics, Inc. (NYSE:
PLT) ("Poly" or the "Company") today announced third quarter fiscal
year 2020 results for the period ending December 31, 2019.
Highlights of the third quarter include the following:
($ Millions, except
percent and per-share data)1
|
Q3
FY20
|
Q3
FY19
|
|
YTD
FY20
|
YTD
FY192
|
GAAP
Revenue
|
$384
|
|
$502
|
|
|
$1,294
|
|
$1,206
|
|
GAAP Gross
Margin
|
37.4
|
%
|
42.9
|
%
|
|
43.5
|
%
|
39.6
|
%
|
GAAP Operating
Income
|
($77)
|
|
($25)
|
|
|
($111)
|
|
($90)
|
|
GAAP Diluted
EPS
|
($1.97)
|
|
($1.06)
|
|
|
($3.78)
|
|
($3.08)
|
|
Cash Flow from
Operations
|
($17)
|
|
$47
|
|
|
$16
|
|
$119
|
|
|
|
|
|
|
|
Non-GAAP
Revenue
|
$392
|
|
$531
|
|
|
$1,322
|
|
$1,272
|
|
Non-GAAP Gross
Margin
|
49.4
|
%
|
51.5
|
%
|
|
52.7
|
%
|
51.9
|
%
|
Non-GAAP Operating
Income
|
$31
|
|
$93
|
|
|
$198
|
|
$225
|
|
Non-GAAP Diluted
EPS
|
$0.30
|
|
$1.36
|
|
|
$2.85
|
|
$3.68
|
|
Adjusted
EBITDA
|
$43
|
|
$105
|
|
|
$234
|
|
$256
|
|
|
|
1
|
For further
information on supplemental non-GAAP metrics refer to the Use of
Non-GAAP And Comparative Financial Information and Unaudited
Reconciliations of GAAP Measures To Non-GAAP Measures sections
below.
|
2
|
YTD FY19 results
shown here do not reflect Polycom results for the three months
ended June 30, 2018 due to the completion of the Polycom
acquisition on July 2, 2018.
|
"While we are disappointed with our results this quarter,
particularly Enterprise headsets, we have now begun shipping the
first products built on our next-generation architecture for the
cloud-connected world," said Joe
Burton, President and Chief Executive Officer. "As we ramp
the new product portfolio and address our sales and channel
distribution issues, we are committed to return to sustained
profitable revenue growth."
Results Compared
to November 5, 2019 Guidance
|
|
Q3 FY20
Results
|
Q3 FY20 Guidance
Range3
|
GAAP Net
Revenue
|
$384M
|
$383M -
$423M
|
Non-GAAP Net
Revenue
|
$392M
|
$390M -
$430M
|
Adjusted
EBITDA
|
$43M
|
$33M -
$53M
|
Non-GAAP Diluted
EPS
|
$0.30
|
$0.01 -
$0.31
|
|
|
3
|
The non-GAAP
revenue guidance range shown here excludes the $7.1 million impact
of purchase accounting related to recording deferred revenue at
fair value at the time of the acquisition.
|
"We reduced both channel and on-hand inventory in fiscal Q3,"
said Chuck Boynton, Executive Vice
President and Chief Financial Officer. "In addition, we are
announcing the sale of our Consumer Gaming business, which we
expect to improve margins and working capital. Lastly, we continue
to optimize the remaining Consumer portfolio to improve focus and
profitability."
Highlights for the Third Quarter and Fiscal Year 2020
- Recently introduced products now shipping for revenue
include:
-
- Studio X30 and X50 video bars with optional TC8 room
controller
- CCX 400 and 500 desktop phones designed for Microsoft
Teams
- Voyager 4200 and Voyager 5200 Office Series, EncorePro 300, and
MDA 500QD
- Many of Poly's most popular headset families now officially
support Zoom for Zoom Meetings and Zoom Phone. The combined
Poly portfolio now offers the broadest selection of Zoom certified
and Zoom-supported end points available in the market today.
- Poly announced the appointment of Carl
Wiese as EVP and Chief Revenue Officer in charge of global
sales. Wiese brings more than 30 years of experience in sales,
marketing, services, and product management for enterprise
technology leaders.
- The Company has entered into a definitive agreement to sell its
Consumer Gaming assets and expects the transaction to close by the
end of March.
Poly Announces Quarterly Dividend of $0.15
The Poly Board of Directors has declared a quarterly cash
dividend of $0.15 per common share,
to be paid on March 10, 2020, to all shareholders of record as
of the close of market on February 20, 2020.
Business Outlook
The following statements are based on the Company's current
expectations, and many of these statements are forward-looking.
Actual results are subject to a variety of risks and uncertainties
and may differ materially from the Company's expectations. Please
refer to the Forward Looking Statements Safe Harbor section
of this press release below.
The following represents the expected range of financial results
for the fourth quarter 2020 (all amounts assuming currency rates
remain stable):
|
Q4 FY20
Guidance
|
GAAP Net
Revenue
|
$354M -
$394M
|
Non-GAAP Net
Revenue1
|
$360M -
$400M
|
Adjusted
EBITDA2
|
$20M -
$45M
|
Non-GAAP Diluted
EPS2,3
|
$(0.36) -
$0.19
|
|
1
|
Q4 non-GAAP revenue
guidance excludes anticipated purchase accounting adjustments of
$6.1 million.
|
2
|
Q4
Adjusted EBITDA and non-GAAP diluted EPS guidance excludes
estimated intangibles amortization expense of $46.3 million. With
respect to adjusted EBITDA and diluted EPS guidance, the Company
has determined that it is unable to provide quantitative
reconciliations of these forward-looking non-GAAP measures to the
most directly comparable forward-looking GAAP measures with a
reasonable degree of confidence in their accuracy without
unreasonable effort, as items including stock based compensation,
acquisition and integration costs, litigation gains and losses, and
impacts from discrete tax adjustments and tax laws are inherently
uncertain and depend on various factors, many of which are beyond
the Company's control.
|
3
|
EPS guidance assumes
approximately 41 million diluted average weighted shares and a
non-GAAP effective tax rate of 6% to 8%.
|
Conference Call and Earnings Presentation
Poly is providing an earnings presentation in combination with
this press release. The presentation is offered to provide
shareholders and analysts with additional detail for analyzing
results. The presentation will be available in the Investor
Relations section of our corporate website at investor.poly.com
along with this press release. A reconciliation of our GAAP to
non-GAAP results is provided at the end of this press release.
We have scheduled a conference call to discuss third quarter
fiscal year 2020 financial results. The conference call will take
place today, February 4, 2020, at 2:00
PM (Pacific Time). All interested investors and potential
investors in Poly stock are invited to participate. To listen to
the call, please dial in five to ten minutes prior to the scheduled
starting time and refer to the "Poly Conference Call." The
dial-in from North America is
(888) 301-8736 and the international dial-in is (706) 634-7260.
The conference call will also be simultaneously webcast and can
be accessed from the Investor Relations section of our website. A
replay of the call with the conference ID #8387169 will be
available until April 5, 2020 at
(855) 859-2056 for callers from North
America and at (404) 537-3406 for all other callers.
Use of Non-GAAP Financial Information
To supplement our condensed consolidated financial statements
presented on a GAAP basis, we use non-GAAP measures of operating
results, including non-GAAP net revenues, non-GAAP gross profit,
non-GAAP operating expenses, non-GAAP operating income, non-GAAP
net income, adjusted EBITDA, and non-GAAP diluted EPS. These
non-GAAP measures are adjusted from the most directly comparable
GAAP measures to exclude, or include where applicable, the effect
of purchase accounting on deferred revenue and inventory, charges
associated with the optimization of our Consumer product line,
stock-based compensation, acquisition related expenses, purchase
accounting amortization and adjustments, restructuring and other
related charges and credits, rebranding costs, other unusual and/or
non-cash charges and credits, and the impact of participating
securities, all net of any associated tax impact. We also exclude
tax benefits from the release of tax reserves, discrete tax
adjustments including transfer pricing, tax deduction and tax
credit adjustments, and the impact of tax law changes. We adjust
these amounts from our non-GAAP measures primarily because
management does not believe they are consistent with the
development of our target operating model. We believe that the use
of non-GAAP financial measures provides meaningful supplemental
information regarding our performance and liquidity and helps
investors compare actual results with our historical and long-term
target operating model goals as well as our performance as a
combined company. We believe presenting non-GAAP net revenue
provides meaningful supplemental information regarding how
management views the performance of the business and underlying
performance of our individual product categories. We believe that
both management and investors benefit from referring to these
non-GAAP financial measures in assessing our performance and when
planning, forecasting and analyzing future periods; however,
non-GAAP financial measures are not meant to be considered in
isolation of, or as a substitute for, or superior to, net revenues,
gross margin, operating expenses, operating income, operating
margin, net income or EPS prepared in accordance with GAAP.
Forward Looking Statements Safe Harbor
This release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended,
including statements relating to: (i) our efforts to execute to
drive sales and sustainable profitable revenue growth; (ii) our
expectations for new products launches, the timing of their
releases and their expected impact on future growth and on our
existing products; (iii) our expectations to avoid business
disruption due to potential global health issues, (iv) our
expectations for synergies in the quarter and additional
anticipated cost savings; (v) our expectations related to the sale
of our gaming product line and further optimization of our Consumer
product line; (vi) beliefs regarding the strategic and financial
benefits of focusing on our Enterprise business, simplifying
business processes and reducing working capital; (vii) our
expectations for operating cash flow and debt; (viii) expectations
relating to our Q-4 and full Fiscal Year 2020 earnings guidance;
(ix) estimates of GAAP and non-GAAP financial results for the
fourth quarter and full Fiscal Year 2020, including net revenues,
purchase accounting adjustments, adjusted EBITDA, tax rates,
intangibles amortization, and diluted weighted average shares
outstanding and diluted EPS; (x) expectations related to our
customers' purchasing decisions and our ability to match product
production to demand; (xi) our expectations of the impact of the
acquisition of Polycom as it relates to our strategic vision and
additional market and strategic partnership opportunities for our
combined hardware and services offerings; (xii) our beliefs
regarding the UC&C market, market dynamics and opportunities,
and customer and partner behavior as well as our position in the
market; (xiii) our belief that the increased adoption of certain
technologies and our open architecture approach has and will
continue to increase demand for our solutions; (xiv) expectations
related to the micro and macro-economic conditions in our domestic
and international markets and their impact on our future business;
(xv) our forecasts and expectations regarding liquidity,
capital resources and results of operations along with our
intentions concerning the repayment of our debt obligations and our
ability to draw funds on our credit facility as needed; (xvi) our
forecast and estimates with respect to tax matters, including
expectations with respect to utilizing our deferred tax assets;
(xvii) our expectations regarding pending and potential future
litigation, in addition to other matters discussed in this
press release that are not purely historical data.
We do not assume any obligation to update or revise any such
forward-looking statements, whether as the result of new
developments or otherwise.
Forward-looking statements involve risks and uncertainties that
may cause actual results to differ materially from those
contemplated by such statements. Among the factors that could
cause actual results to differ materially from those contemplated
are:
- Regarding the Polycom acquisition: (i) we may be unable to
integrate Polycom's business within our own in a timely and
cost-efficient manner or do so without adversely impacting
operations, including new product launches; (ii) expected synergies
or operating efficiencies may fail to materialize in whole or part
or may not occur within expected time-frames; (iii) the acquisition
and our subsequent integration efforts may adversely impact
relationships with customers, suppliers and strategic partners and
their operating results and businesses generally (including the
diversion of management time on transaction-related issues); (iv)
we may be unable to retain and hire key personnel; (v) our
increased leverage as a result of the transaction is substantially
greater than prior to the acquisition which may pose risks,
including reduced flexibility in how we use our cash and to make
changes in our operations in response to business or economic
conditions, increased borrowing costs, as well as penalties or
costs should we fail to comply with terms of the financial
agreements such as debt ratios and financial and operation
performance targets; (vi) negative effects on the market price of
our common stock as a result of the transaction, particularly in
light of the issuance of our stock in the transaction; (vii) our
financial reporting including those resulting from the adoption of
new accounting pronouncements and associated system implementations
in the context of the transaction, our ability to forecast
financial results of the combined company and that we may be unable
to successfully integrate our reporting system causing an adverse
impact to our ability to make timely and accurate filings with the
SEC and other domestic and foreign governmental agencies; (viii)
the potential impact of the transaction on our future tax rate and
payments based on our global entity consolidation efforts and our
ability to quickly and cost effectively integrate foreign
operations; (ix) the challenges of integrating the supply chains of
the two companies; (x) the challenges of sales execution across
different product lines; (xi) our expectations regarding
our the potential that our due diligence did not uncover
risks and potential liabilities of Polycom;
- the nature and extent of competition we face, particularly
subsequent to the acquisition of Polycom as it relates to our
ability to adapt to new competitors and changing markets;
- the impact of product transitions underway which are replacing
or upgrading nearly every major product in our product
portfolio;
- the impact of customer brand preferences on Consumer and
Enterprise market demands;
- the impact of our adoption of a new corporate branding
identity, including any confusion or harm to our reputation
resulting therefrom;
- the impact of ongoing integration, restructuring and
disaggregation activities on our operations, including on
employees, distributors, VARs, suppliers, and customers from the
Polycom acquisition;
- our ability to realize and achieve positive financial results
projected to arise in the our key markets from UC&C adoption
could be adversely affected by a variety of factors including the
following: (i) as UC&C becomes more widely adopted, the risk
that competitors will offer solutions that will effectively
commoditize our products which, in turn, will reduce the sales
prices for those products; (ii) our plans are dependent upon
adoption of our UC&C solution by major platform providers and
any proprietary solutions of competitors, and our influence over
such providers and the marketing in general with respect to the
functionality of their platforms or their product offerings, their
rate of deployment, and their willingness to integrate their
platforms and product offerings with our solutions is limited;
(iii) delays or limitations on our ability to timely introduce
solutions that are cost effective, feature-rich, stable, and
attractive to our customers within forecasted development budgets;
(iv) our successful implementation and execution of new and
different processes involving the design, development, and
manufacturing of complex electronic systems composed of hardware,
firmware, and software that works seamlessly and continuously in a
wide variety of environments and with multiple devices; (v) failure
of UC&C solutions generally, or our solutions in particular, to
be adopted with the breadth and speed we anticipate; (vi) our sales
model and expertise must successfully evolve to support complex
integration of hardware, software, and services with UC&C
infrastructure consistent with changing customer purchasing
expectations; (vii) as UC&C becomes more widely adopted we
anticipate that competition for market share will increase,
particularly given that some competitors may have superior
technical and economic resources; (viii) sales cycles for UC&C
deployments are longer and becoming more complex; (ix) our
inability to timely and cost-effectively adapt to changing business
requirements may impact our profitability in this market and our
overall margins; and (x) our failure to expand our technical
support capabilities to support the complex and proprietary
platforms in which our UC&C products are and will be
integrated;
- risks associated with our channel partners' sales reporting,
product inventories and product sell through since we sell a
significant amount of products to channel partners who maintain
their own inventory of our products;
- failure to match production to demand given long lead times and
the difficulty of forecasting unit volumes and acquiring the
component parts and materials to meet demand without having excess
inventory or incurring cancellation charges;
- risks associated with forecasting sales and procurement
demands, which are inherently difficult, particularly with
continuing uncertainty in regional and global economic conditions
as well as currency fluctuations, and there can be no assurance
that expectations of incoming orders over the balance of the
current quarter will materialize;
- volatility in prices and availability of components from our
suppliers, including our manufacturers located in APAC, have in the
past and could in the future negatively affect our profitability
and/or market share;
- fluctuations in foreign exchange rates;
- new or greater tariffs on our products;
- the bankruptcy or financial weakness of distributors or key
customers, or the bankruptcy of or reduction in capacity of our key
suppliers;
- additional risk factors including: interruption in the supply
of sole-sourced critical components, continuity of component supply
at costs consistent with our plans, and the inherent risks of our
substantial foreign operations;
- seasonality in one or more of our product categories;
- the potential impact to our results of operations from tax
rulings and interpretations;
- risks related to our forecasts and expectations regarding
liquidity, capital resources and results of operations along with
our intentions concerning the repayment of our debt obligations and
our ability to draw funds on our credit facility as needed;
- potential fluctuations in our cash provided by operating
activities;
- risks associated with our anticipated range of capital
expenditures for the remainder of Fiscal Year 2020;
- the sufficiency of our cash, cash equivalents, and cash from
operations to sustain future operations and discretionary cash
requirements;
- our expenses and expenditures, including research, development
and engineering as well selling, general and administrative;
- changes in tax laws that could increase our future
tax rate and payments related to unrecognized tax benefits and/or
reduce our deferred tax assets;
- risks related to our forecasts and estimates with respect to
tax matters, including expectations with respect to utilizing our
deferred tax assets;
- if we are unable to generate sufficient amount of income, a
substantial valuation allowance to reduce the deferred tax assets
may be required;
- our ability to pay future stockholder dividends or repurchase
stock;
- our beliefs concerning interest rates and foreign currency
exchange rates, our exposure to changes in each, and the benefits
and risks of our hedging activities;
- the risks of global health issues impacting supply chain,
distribution, product availability, sales execution and/or other
business disruption to our business; and
- risks related to adverse results in pending litigation or other
regulatory proceedings.
For more information concerning these and other possible risks,
please refer to our Annual Report on Form 10-K filed with the
Securities and Exchange Commission on May 17, 2019 and other
filings with the Securities and Exchange Commission, as well as
recent press releases. The Securities and Exchange Commission
filings can be accessed over the Internet at
http://www.sec.gov/edgar/searchedgar/companysearch.html.
Financial Summaries
The following related charts are provided:
- Summary Unaudited Condensed Consolidated Financial
Statements
- Unaudited Reconciliations of GAAP Measures to Non-GAAP
Measures
About Poly
Poly is a global communications company that powers meaningful
human connection and collaboration. Poly combines legendary audio
expertise and powerful video and conferencing capabilities
to overcome the distractions, complexity and distance
that make communication in and out of the workplace challenging.
Poly believes in solutions that make life easier when they work
together and with our partner's services. Our headsets, software,
desk phones, audio and video conferencing, analytics and services
are used worldwide and are a leading choice for every kind of
workspace. For more information, please
visit: www.poly.com.
Poly and the propeller design are trademarks of Plantronics,
Inc. All other trademarks are the property of their respective
owners.
INVESTOR CONTACT:
Mike Iburg
Vice President, Investor Relations
(831) 458-7533
MEDIA CONTACT:
Edie Kissko
Senior Director and Head of Corporate Communications
(213) 369-3719
PLANTRONICS,
INC.
|
SUMMARY CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
|
($ in thousands,
except per share data)
|
|
UNAUDITED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
|
December
31,
|
|
December
31,
|
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
Net
revenues:
|
|
|
|
|
|
|
|
|
|
Net product
revenues
|
|
$
|
316,633
|
|
|
$
|
445,441
|
|
|
$
|
1,094,515
|
|
|
$
|
1,102,012
|
|
|
Net services
revenues
|
|
67,838
|
|
|
56,228
|
|
|
199,432
|
|
|
104,035
|
|
|
Total net
revenues
|
|
384,471
|
|
|
501,669
|
|
|
1,293,947
|
|
|
1,206,047
|
|
|
Cost of
revenues:
|
|
|
|
|
|
|
|
|
|
Cost of product
revenues
|
|
220,469
|
|
|
259,673
|
|
|
658,408
|
|
|
676,616
|
|
|
Cost of service
revenues
|
|
20,156
|
|
|
26,859
|
|
|
72,976
|
|
|
51,822
|
|
|
Total cost of
revenues
|
|
240,625
|
|
|
286,532
|
|
|
731,384
|
|
|
728,438
|
|
|
Gross
profit
|
|
143,846
|
|
|
215,137
|
|
|
562,563
|
|
|
477,609
|
|
|
Gross profit
%
|
|
37.4
|
%
|
|
42.9
|
%
|
|
43.5
|
%
|
|
39.6
|
%
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
Research,
development, and engineering
|
|
53,769
|
|
|
59,661
|
|
|
170,708
|
|
|
140,409
|
|
|
Selling, general, and
administrative
|
|
144,978
|
|
|
168,053
|
|
|
457,004
|
|
|
406,553
|
|
|
(Gain) loss, net from
litigation settlements
|
|
—
|
|
|
—
|
|
|
(1,162)
|
|
|
(30)
|
|
|
Restructuring and
other related charges
|
|
21,724
|
|
|
12,130
|
|
|
47,096
|
|
|
20,711
|
|
|
Total operating
expenses
|
|
220,471
|
|
|
239,844
|
|
|
673,646
|
|
|
567,643
|
|
|
Operating
income
|
|
(76,625)
|
|
|
(24,707)
|
|
|
(111,083)
|
|
|
(90,034)
|
|
|
Operating income
%
|
|
(19.9)
|
%
|
|
(4.9)
|
%
|
|
(8.6)
|
%
|
|
(7.5)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
(22,533)
|
|
|
(25,032)
|
|
|
(70,262)
|
|
|
(56,252)
|
|
|
Other non-operating
income, net
|
|
967
|
|
|
125
|
|
|
675
|
|
|
3,731
|
|
|
Income before income
taxes
|
|
(98,191)
|
|
|
(49,614)
|
|
|
(180,670)
|
|
|
(142,555)
|
|
|
Income tax expense
(benefit)
|
|
(19,708)
|
|
|
(7,880)
|
|
|
(31,406)
|
|
|
(28,584)
|
|
|
Net income
(loss)
|
|
$
|
(78,483)
|
|
|
$
|
(41,734)
|
|
|
$
|
(149,264)
|
|
|
$
|
(113,971)
|
|
|
|
|
|
|
|
|
|
|
|
|
% of net
revenues
|
|
(20.4)
|
%
|
|
(8.3)
|
%
|
|
(11.5)
|
%
|
|
(9.4)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per common
share:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
(1.97)
|
|
|
$
|
(1.06)
|
|
|
$
|
(3.78)
|
|
|
$
|
(3.08)
|
|
|
Diluted
|
|
$
|
(1.97)
|
|
|
$
|
(1.06)
|
|
|
$
|
(3.78)
|
|
|
$
|
(3.08)
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in
computing earnings per common share:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
39,784
|
|
|
39,314
|
|
|
39,535
|
|
|
37,063
|
|
|
Diluted
|
|
39,784
|
|
|
39,314
|
|
|
39,535
|
|
|
37,063
|
|
|
|
|
|
|
|
|
|
|
|
|
Effective tax
rate
|
|
(20.1)
|
%
|
|
(15.9)
|
%
|
|
(17.4)
|
%
|
|
(20.1)
|
%
|
|
PLANTRONICS,
INC.
|
SUMMARY CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
|
($ in
thousands)
|
|
UNAUDITED
CONSOLIDATED BALANCE SHEETS
|
|
|
December
31,
|
|
March
31,
|
|
|
|
2019
|
|
2019
|
|
ASSETS
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
156,821
|
|
|
$
|
202,509
|
|
|
Short-term
investments
|
|
15,317
|
|
|
13,332
|
|
|
Total cash, cash
equivalents, and short-term investments
|
|
172,138
|
|
|
215,841
|
|
|
Accounts receivable,
net
|
|
246,318
|
|
|
337,671
|
|
|
Inventory,
net
|
|
215,038
|
|
|
177,146
|
|
|
Other current
assets
|
|
54,533
|
|
|
50,488
|
|
|
Total current
assets
|
|
688,027
|
|
|
781,146
|
|
|
Property, plant, and
equipment, net
|
|
177,482
|
|
|
204,826
|
|
|
Purchased
intangibles, net
|
|
688,258
|
|
|
825,675
|
|
|
Goodwill
|
|
1,279,897
|
|
|
1,278,380
|
|
|
Deferred tax and
other assets
|
|
97,203
|
|
|
26,508
|
|
|
Total
assets
|
|
$
|
2,930,867
|
|
|
$
|
3,116,535
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
Accounts
payable
|
|
$
|
122,314
|
|
|
$
|
129,514
|
|
|
Accrued
liabilities
|
|
363,394
|
|
|
398,715
|
|
|
Total current
liabilities
|
|
485,708
|
|
|
528,229
|
|
|
Long-term debt, net
of issuance costs
|
|
1,620,354
|
|
|
1,640,801
|
|
|
Long-term income
taxes payable
|
|
98,386
|
|
|
83,121
|
|
|
Other long-term
liabilities
|
|
138,342
|
|
|
142,697
|
|
|
Total
liabilities
|
|
2,342,790
|
|
|
2,394,848
|
|
|
Stockholders'
equity
|
|
588,077
|
|
|
721,687
|
|
|
Total liabilities and
stockholders' equity
|
|
$
|
2,930,867
|
|
|
$
|
3,116,535
|
|
|
|
|
|
|
|
|
PLANTRONICS,
INC.
|
SUMMARY CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
|
($ in thousands,
except per share data)
|
|
UNAUDITED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
|
December
31,
|
|
December
31,
|
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
Cash flows from
operating activities
|
|
|
|
|
|
|
|
|
|
Net Income
|
|
$
|
(78,483)
|
|
|
$
|
(41,734)
|
|
|
$
|
(149,264)
|
|
|
$
|
(113,971)
|
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
57,556
|
|
|
55,117
|
|
|
172,630
|
|
|
142,763
|
|
|
Amortization of debt
issuance cost
|
|
1,340
|
|
|
1,419
|
|
|
4,062
|
|
|
3,188
|
|
|
Stock-based
compensation
|
|
13,902
|
|
|
11,719
|
|
|
41,499
|
|
|
30,709
|
|
|
Deferred income
taxes
|
|
(17,369)
|
|
|
(21,931)
|
|
|
(66,171)
|
|
|
(39,987)
|
|
|
Provision for excess
and obsolete inventories
|
|
13,394
|
|
|
2,073
|
|
|
19,076
|
|
|
4,881
|
|
|
Restructuring
charges
|
|
21,724
|
|
|
12,130
|
|
|
47,096
|
|
|
20,711
|
|
|
Cash payments for
restructuring charges
|
|
(6,936)
|
|
|
(3,827)
|
|
|
(29,885)
|
|
|
(11,222)
|
|
|
Other operating
activities
|
|
(5,693)
|
|
|
60
|
|
|
3,201
|
|
|
9,070
|
|
|
Changes in assets and
liabilities:
|
|
|
|
|
|
|
|
|
|
Accounts receivable,
net
|
|
30,856
|
|
|
(12,075)
|
|
|
34,634
|
|
|
(35,938)
|
|
|
Inventory,
net
|
|
6,264
|
|
|
(5,362)
|
|
|
(49,320)
|
|
|
11,018
|
|
|
Current and other
assets
|
|
14,790
|
|
|
33,149
|
|
|
24,142
|
|
|
30,456
|
|
|
Accounts
payable
|
|
(45,600)
|
|
|
(4,108)
|
|
|
(10,690)
|
|
|
16,519
|
|
|
Accrued
liabilities
|
|
(15,212)
|
|
|
33,172
|
|
|
(46,906)
|
|
|
72,677
|
|
|
Income
taxes
|
|
(7,744)
|
|
|
(13,110)
|
|
|
22,251
|
|
|
(21,631)
|
|
|
Cash provided by
operating activities
|
|
$
|
(17,211)
|
|
|
$
|
46,693
|
|
|
$
|
16,355
|
|
|
$
|
119,243
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities
|
|
|
|
|
|
|
|
|
|
Proceeds from sale of
investments
|
|
7
|
|
|
1,159
|
|
|
177
|
|
|
125,799
|
|
|
Proceeds from
maturities of investments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
131,017
|
|
|
Purchase of
investments
|
|
(166)
|
|
|
(162)
|
|
|
(972)
|
|
|
(698)
|
|
|
Acquisitions, net of
cash acquired
|
|
—
|
|
|
8,001
|
|
|
—
|
|
|
(1,642,241)
|
|
|
Capital
expenditures
|
|
(7,724)
|
|
|
(8,613)
|
|
|
(16,984)
|
|
|
(16,148)
|
|
|
Proceeds from sale of
property and equipment
|
|
—
|
|
|
—
|
|
|
2,142
|
|
|
—
|
|
|
Cash provided by
(used for) investing activities
|
|
$
|
(7,883)
|
|
|
$
|
385
|
|
|
$
|
(15,637)
|
|
|
$
|
(1,402,271)
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities
|
|
|
|
|
|
|
|
|
|
Repurchase of common
stock
|
|
—
|
|
|
(4,780)
|
|
|
—
|
|
|
(4,780)
|
|
|
Employees' tax
withheld and paid for restricted stock and restricted stock
units
|
|
(388)
|
|
|
(521)
|
|
|
(9,669)
|
|
|
(13,863)
|
|
|
Proceeds from
issuances under stock-based compensation plans
|
|
1
|
|
|
53
|
|
|
6,617
|
|
|
14,925
|
|
|
Repayments of
long-term debt
|
|
—
|
|
|
—
|
|
|
(25,000)
|
|
|
—
|
|
|
Proceeds from debt
issuance, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,244,713
|
|
|
Payment of cash
dividends
|
|
(5,988)
|
|
|
(5,971)
|
|
|
(17,910)
|
|
|
(16,953)
|
|
|
Cash used for
financing activities
|
|
$
|
(6,375)
|
|
|
$
|
(11,219)
|
|
|
$
|
(45,962)
|
|
|
$
|
1,224,042
|
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
|
1,848
|
|
|
1,211
|
|
|
(444)
|
|
|
(3,519)
|
|
|
Net increase
(decrease) in cash and cash equivalents
|
|
(29,621)
|
|
|
37,070
|
|
|
(45,688)
|
|
|
(62,505)
|
|
|
Cash and cash
equivalents at beginning of period
|
|
186,442
|
|
|
291,086
|
|
|
202,509
|
|
|
390,661
|
|
|
Cash and cash
equivalents at end of period
|
|
$
|
156,821
|
|
|
$
|
328,156
|
|
|
$
|
156,821
|
|
|
$
|
328,156
|
|
|
|
|
|
|
|
|
|
|
|
|
PLANTRONICS,
INC.
|
UNAUDITED
RECONCILIATIONS OF GAAP MEASURES TO NON-GAAP
MEASURES
|
($ in thousands,
except per share data)
|
|
UNAUDITED
CONSOLIDATED STATEMENTS OF OPERATIONS DATA
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
December
31,
|
|
December
31,
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
|
|
|
|
|
|
|
|
GAAP Net
revenues
|
$
|
384,471
|
|
|
$
|
501,669
|
|
|
$
|
1,293,947
|
|
|
$
|
1,206,047
|
|
|
Deferred revenue
purchase accounting
|
7,131
|
|
|
28,923
|
|
|
27,815
|
|
|
65,508
|
|
|
Non-GAAP Net
revenues
|
$
|
391,602
|
|
|
$
|
530,592
|
|
|
$
|
1,321,762
|
|
|
$
|
1,271,555
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Gross
profit
|
$
|
143,846
|
|
|
$
|
215,137
|
|
|
$
|
562,563
|
|
|
$
|
477,609
|
|
|
Purchase accounting
amortization
|
30,819
|
|
|
27,575
|
|
|
91,535
|
|
|
83,243
|
|
|
Inventory valuation
adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
30,395
|
|
|
Deferred revenue
purchase accounting
|
7,131
|
|
|
28,923
|
|
|
27,815
|
|
|
65,508
|
|
|
Consumer
optimization
|
10,415
|
|
|
—
|
|
|
10,415
|
|
|
—
|
|
|
Acquisition and
integration fees
|
46
|
|
|
404
|
|
|
1,056
|
|
|
621
|
|
|
Stock-based
compensation
|
1,019
|
|
|
1,067
|
|
|
2,994
|
|
|
3,103
|
|
|
Rebranding
costs
|
54
|
|
|
—
|
|
|
113
|
|
|
—
|
|
|
Non-GAAP Gross
profit
|
$
|
193,330
|
|
|
$
|
273,106
|
|
|
$
|
696,491
|
|
|
$
|
660,479
|
|
|
Non-GAAP Gross
profit %
|
49.4
|
%
|
|
51.5
|
%
|
|
52.7
|
%
|
|
51.9
|
%
|
|
|
|
|
|
|
|
|
|
|
GAAP Research,
development, and engineering
|
$
|
53,769
|
|
|
$
|
59,661
|
|
|
$
|
170,708
|
|
|
$
|
140,409
|
|
|
Stock-based
compensation
|
(4,584)
|
|
|
(2,887)
|
|
|
(12,516)
|
|
|
(7,877)
|
|
|
Acquisition and
integration fees
|
(538)
|
|
|
(95)
|
|
|
(2,439)
|
|
|
(151)
|
|
|
Other
adjustments
|
—
|
|
|
—
|
|
|
(542)
|
|
|
—
|
|
|
Non-GAAP Research,
development, and engineering
|
$
|
48,647
|
|
|
$
|
56,679
|
|
|
$
|
155,211
|
|
|
$
|
132,381
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Selling,
general, and administrative
|
$
|
144,978
|
|
|
$
|
168,053
|
|
|
$
|
457,004
|
|
|
$
|
406,553
|
|
|
Acquisition and
integration fees
|
(7,715)
|
|
|
(21,775)
|
|
|
(35,896)
|
|
|
(53,558)
|
|
|
Purchase accounting
amortization
|
(15,278)
|
|
|
(15,278)
|
|
|
(45,834)
|
|
|
(30,557)
|
|
|
Stock-based
compensation
|
(8,299)
|
|
|
(7,765)
|
|
|
(25,989)
|
|
|
(19,729)
|
|
|
Rebranding
costs
|
(324)
|
|
|
—
|
|
|
(6,392)
|
|
|
—
|
|
|
Non-GAAP Selling,
general, and administrative
|
$
|
113,362
|
|
|
$
|
123,235
|
|
|
$
|
342,893
|
|
|
$
|
302,709
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Operating
expenses
|
$
|
220,471
|
|
|
$
|
239,844
|
|
|
$
|
673,646
|
|
|
$
|
567,643
|
|
|
Acquisition and
integration fees
|
(8,253)
|
|
|
(21,870)
|
|
|
(38,335)
|
|
|
(53,709)
|
|
|
Purchase accounting
amortization
|
(15,278)
|
|
|
(15,278)
|
|
|
(45,834)
|
|
|
(30,557)
|
|
|
Stock-based
compensation
|
(12,883)
|
|
|
(10,652)
|
|
|
(38,505)
|
|
|
(27,606)
|
|
|
Restructuring and
other related charges
|
(21,724)
|
|
|
(12,130)
|
|
|
(47,096)
|
|
|
(20,711)
|
|
|
Rebranding
costs
|
(324)
|
|
|
—
|
|
|
(6,392)
|
|
|
—
|
|
|
Other
adjustments
|
—
|
|
|
—
|
|
|
620
|
|
|
—
|
|
|
Non-GAAP Operating
expenses
|
$
|
162,009
|
|
|
$
|
179,914
|
|
|
$
|
498,104
|
|
|
$
|
435,060
|
|
|
|
|
|
|
|
|
|
|
|
PLANTRONICS,
INC.
|
UNAUDITED
RECONCILIATIONS OF GAAP MEASURES TO NON-GAAP
MEASURES
|
($ in thousands,
except per share data)
|
|
UNAUDITED
CONSOLIDATED STATEMENTS OF OPERATIONS DATA
(CONTINUED)
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
December
31,
|
|
December
31,
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
GAAP Operating
income
|
$
|
(76,625)
|
|
|
$
|
(24,707)
|
|
|
$
|
(111,083)
|
|
|
$
|
(90,034)
|
|
|
Purchase accounting
amortization
|
46,097
|
|
|
42,853
|
|
|
137,369
|
|
|
113,800
|
|
|
Inventory valuation
adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
30,395
|
|
|
Deferred revenue
purchase accounting
|
7,131
|
|
|
28,923
|
|
|
27,815
|
|
|
65,508
|
|
|
Consumer
optimization
|
10,415
|
|
|
—
|
|
|
10,415
|
|
|
—
|
|
|
Acquisition and
integration fees
|
8,299
|
|
|
22,274
|
|
|
39,391
|
|
|
54,330
|
|
|
Stock-based
compensation
|
13,902
|
|
|
11,719
|
|
|
41,499
|
|
|
30,709
|
|
|
Restructuring and
other related charges
|
21,724
|
|
|
12,130
|
|
|
47,096
|
|
|
20,711
|
|
|
Rebranding
costs
|
378
|
|
|
—
|
|
|
6,505
|
|
|
—
|
|
|
Other
adjustments
|
—
|
|
|
—
|
|
|
(620)
|
|
|
—
|
|
|
Non-GAAP Operating
income
|
$
|
31,321
|
|
|
$
|
93,192
|
|
|
$
|
198,387
|
|
|
$
|
225,419
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Net
income
|
$
|
(78,483)
|
|
|
$
|
(41,734)
|
|
|
$
|
(149,264)
|
|
|
$
|
(113,971)
|
|
|
Purchase accounting
amortization
|
46,097
|
|
|
42,853
|
|
|
137,369
|
|
|
113,800
|
|
|
Inventory valuation
adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
30,395
|
|
|
Deferred revenue
purchase accounting
|
7,131
|
|
|
28,923
|
|
|
27,815
|
|
|
65,508
|
|
|
Consumer
optimization
|
10,415
|
|
5
|
—
|
|
|
10,415
|
|
5
|
—
|
|
|
Acquisition and
integration fees
|
8,299
|
|
|
22,274
|
|
|
39,391
|
|
|
54,330
|
|
|
Stock-based
compensation
|
13,902
|
|
|
11,719
|
|
|
41,499
|
|
|
30,709
|
|
|
Restructuring and
other related charges
|
21,724
|
|
|
12,130
|
|
|
47,096
|
|
|
20,711
|
|
|
Rebranding
costs
|
378
|
|
|
—
|
|
|
6,505
|
|
|
—
|
|
|
Other
adjustments
|
—
|
|
|
—
|
|
1
|
|
(620)
|
|
1,
2
|
—
|
|
|
Income tax effect of
above items
|
(17,021)
|
|
|
(18,036)
|
|
|
(45,015)
|
|
|
(56,934)
|
|
|
Income tax effect of
unusual tax items
|
(482)
|
|
3
|
(4,028)
|
|
4
|
(2,001)
|
|
3
|
(5,387)
|
|
4
|
|
Non-GAAP Net
income
|
$
|
11,960
|
|
|
$
|
54,101
|
|
|
$
|
113,190
|
|
|
$
|
139,160
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Diluted earnings
per common share
|
$
|
(1.97)
|
|
|
$
|
(1.06)
|
|
|
$
|
(3.78)
|
|
|
$
|
(3.08)
|
|
|
Purchase accounting
amortization
|
1.16
|
|
|
1.08
|
|
|
3.46
|
|
|
3.01
|
|
|
Inventory valuation
adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
0.80
|
|
|
Deferred revenue
purchase accounting
|
0.18
|
|
|
0.73
|
|
|
0.70
|
|
|
1.73
|
|
|
Consumer
optimization
|
0.26
|
|
|
—
|
|
|
0.26
|
|
|
—
|
|
|
Stock-based
compensation
|
0.35
|
|
|
0.30
|
|
|
1.04
|
|
|
0.81
|
|
|
Acquisition and
integration fees
|
0.21
|
|
|
0.56
|
|
|
0.99
|
|
|
1.44
|
|
|
Restructuring and
other related charges
|
0.54
|
|
|
0.31
|
|
|
1.19
|
|
|
0.55
|
|
|
Rebranding
costs
|
0.01
|
|
|
—
|
|
|
0.16
|
|
|
—
|
|
|
Other
adjustments
|
—
|
|
|
—
|
|
|
(0.01)
|
|
|
—
|
|
|
Income tax
effect
|
(0.44)
|
|
|
(0.57)
|
|
|
(1.19)
|
|
|
(1.65)
|
|
|
Effect of
anti-dilutive securities
|
—
|
|
|
0.01
|
|
|
0.03
|
|
|
0.07
|
|
|
Non-GAAP Diluted
earnings per common share
|
$
|
0.30
|
|
|
$
|
1.36
|
|
|
$
|
2.85
|
|
|
$
|
3.68
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in
diluted earnings per common share calculation:
|
GAAP
|
39,784
|
|
|
39,314
|
|
|
39,535
|
|
|
37,063
|
|
|
non-GAAP
|
39,870
|
|
|
39,712
|
|
|
39,731
|
|
|
37,819
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1
|
Includes Executive
transition costs and losses due to litigation
settlements.
|
2
|
Excluded amounts
represent immaterial gains from litigation.
|
3
|
Excluded amounts
represent changes in tax law and the release of tax
reserves.
|
4
|
Excluded amounts
represent tax benefits resulting from the release of tax reserves
and tax return true-ups.
|
5
|
Excluded amounts
represent inventory related reserves associated with optimizing the
consumer product portfolio.
|
PLANTRONICS,
INC.
|
UNAUDITED
RECONCILIATIONS OF GAAP MEASURES TO NON-GAAP
MEASURES
|
($ in
thousands)
|
|
UNAUDITED
CONSOLIDATED STATEMENTS OF OPERATIONS DATA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
|
|
December
31,
|
|
March
31,
|
|
June
30,
|
|
September
30,
|
|
December
31,
|
|
December
31,
|
|
|
|
2018
|
|
2019
|
|
2019
|
|
2019
|
|
2019
|
|
2019
|
|
GAAP operating
income
|
|
$
|
(24,707)
|
|
|
$
|
(19,259)
|
|
|
$
|
(28,849)
|
|
|
$
|
(5,610)
|
|
|
$
|
(76,625)
|
|
|
$
|
(130,343)
|
|
|
Deferred revenue
purchase accounting
|
|
28,923
|
|
|
19,316
|
|
|
12,159
|
|
|
8,524
|
|
|
7,131
|
|
|
47,130
|
|
|
Consumer
optimization
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,415
|
|
|
10,415
|
|
|
Acquisition and
integration fees
|
|
22,274
|
|
|
14,323
|
|
|
20,435
|
|
|
10,657
|
|
|
8,299
|
|
|
53,714
|
|
|
Stock-based
compensation
|
|
11,719
|
|
|
11,225
|
|
|
12,904
|
|
|
14,693
|
|
|
13,902
|
|
|
52,724
|
|
|
Restructuring and
other related charges
|
|
12,130
|
|
|
11,983
|
|
|
19,525
|
|
|
5,847
|
|
|
21,724
|
|
|
59,079
|
|
|
Rebranding
costs
|
|
—
|
|
|
5,192
|
|
|
5,455
|
|
|
672
|
|
|
378
|
|
|
11,697
|
|
|
Other
adjustments
|
|
—
|
|
|
1,005
|
|
|
(1,162)
|
|
|
542
|
|
|
—
|
|
|
385
|
|
|
Depreciation and
amortization
|
|
55,117
|
|
|
58,606
|
|
|
57,698
|
|
|
57,376
|
|
|
57,556
|
|
|
231,236
|
|
|
Adjusted
EBITDA
|
|
$
|
105,456
|
|
|
$
|
102,391
|
|
|
$
|
98,165
|
|
|
$
|
92,701
|
|
|
$
|
42,780
|
|
|
$
|
336,037
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
View original content to download
multimedia:http://www.prnewswire.com/news-releases/poly-announces-third-quarter-fiscal-year-2020-financial-results-300998843.html
SOURCE Plantronics, Inc. (“Poly” - formerly Plantronics and
Polycom)