EX-99.1 2 exhibit_99-1.htm EXHIBIT 99-1 PRESS RELEASE Q4FY10 exhibit_99-1.htm



PRESS RELEASE
 
FOR INFORMATION, CONTACT:
Greg Klaben
Vice President of Investor Relations
(831) 458-7533
 
FOR RELEASE at 1 P.M. PDT
May 4, 2010
 
Plantronics Announces Fourth Quarter Fiscal 2010 Results
 
Revenue & Earnings Per Share Exceed Guidance; Company Achieves Record Fiscal Year Cash Flow from Operations
 
SANTA CRUZ, CA – May 4, 2010 - Plantronics, Inc. (NYSE: PLT) today announced fourth quarter fiscal 2010 net revenues of $162.3 million compared with $128.1 million in the fourth quarter of fiscal 2009.  Net revenues were above the guidance provided on January 26, 2010 of $150 million to $155 million.  Plantronics' GAAP diluted earnings per share from continuing operations were $0.49 in the fourth quarter of fiscal 2010 compared with a diluted loss per share from continuing operations of $0.15 in the same quarter of the prior year.  Non-GAAP diluted earnings per share from continuing operations for the fourth quarter of fiscal 2010 were $0.53 compared with $0.07 in the fourth quarter of fiscal 2009 and were greater than the previously provided non-GAAP guidance of $0.40 to $0.44.  The difference between GAAP and non-GAAP earnings per share from continuing operations for the fourth quarter of fiscal 2010 includes stock-based compensation charges, purchase accounting amortization and restructuring and other related charges, all net of associated tax benefits along with the release of $1.1 million in tax reserves due to the expiration of certain statutes of limitations.
 
Net revenues for fiscal year 2010 were $613.8 million compared with $674.6 million for fiscal year 2009.  Plantronics' GAAP diluted earnings per share from continuing operations were $1.55 for fiscal year 2010 compared with $0.93 in fiscal year 2009.  Non-GAAP diluted earnings per share from continuing operations for fiscal 2010 were $1.85 and were $1.26 in fiscal year 2009.
 
The Company completed the sale of Altec Lansing, its Audio Entertainment Group (“AEG”) segment, effective as of December 1, 2009.  All results of operations related to AEG including the loss on the sale are classified as discontinued operations for all periods presented. 
 
Plantronics also announced that its Board of Directors declared a quarterly dividend of $0.05 per share.  The dividend is payable on June 10, 2010 to stockholders of record at the close of business on May 20, 2010.
 
“Revenues and profitability exceeded expectations as we experienced better than anticipated demand in our Office & Contact Center product group,” stated Ken Kannappan, President & CEO.  “We believe we are well positioned to benefit from a further economic recovery and continued adoption of Unified Communications technologies.” 
 
“We completed fiscal 2010 with record cash flow from operations and a considerably improved balance sheet from fiscal 2009 including an increase of approximately $151 million in cash, cash equivalents, and short term investments in addition to lower inventory levels.  For fiscal 2011, we remain committed to achieving a high return on capital,” stated Barbara Scherer, SVP Finance and Administration & CFO.

Business Results (Non-GAAP from Continuing Operations)
 
Fourth quarter fiscal 2010 net revenues of $162.3 million increased 27% compared with $128.1 million in the prior year quarter and declined by 2% from $165.9 million in the third quarter of fiscal 2010.  Geographically, revenues in all regions grew year over year but declined sequentially except for the Asia Pacific region in which revenues grew both year over year and sequentially.
 
Improved economic conditions led to increases in net revenues both year over year and sequentially in the Office and Contact Center market.  Office and Contact Center net revenues were $111.9 million in the fourth quarter of fiscal 2010, an increase of 31% from $85.6 million in the fourth quarter of fiscal 2009 and a sequential increase of 9% from $103.1 million in the third quarter of fiscal 2010.
 
Mobile and Gaming & Computer Audio net revenues increased year over year and declined sequentially while net revenues from the Clarity group declined both year over year and sequentially.  Mobile headset net revenues were $35.8 million in the fourth quarter of fiscal 2010, an increase of 17% from the prior year quarter of $30.6 million but a sequential decrease of 24% from $47.0 million in the third quarter of fiscal 2010.
 
Gross margin in the fourth quarter of fiscal 2010 was 54.5% compared with 39.2% in the fourth quarter of the prior year and 48.9% in the third quarter of fiscal 2010.  The increase in the fourth quarter as compared to the same period in the prior year was primarily driven by lower requirements for excess and obsolete inventory, cost reductions, and higher rates of factory utilization.  The sequential improvement was primarily driven by an improved product mix.
 
Operating income in the fourth quarter was $35.9 million compared with previously provided guidance of $27 million to $30 million, resulting in an operating margin of 22.1% as compared to operating income of $8.4 million and an operating margin of 6.5% in the prior year quarter and operating income of $31.8 million and an operating margin of 19.2% in the third quarter of fiscal 2010.
 
Business Outlook
 
The following statements are based on our 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 our expectations.
 
Plantronics has a “book and ship” business model whereby it ships most orders to customers within 48 hours of its receipt of those orders and, therefore, the level of backlog does not provide reliable visibility into potential future revenues.  The Company’s business is inherently difficult to forecast, particularly with continuing uncertainty in global economic conditions, and there can be no assurance that the incoming orders it expects to receive over the balance of the current quarter will materialize.
 
Subject to the foregoing, we are currently expecting the following range of financial results for continuing operations for the first quarter of fiscal 2011:
 
·  
Net revenues of $160 million - $165 million; 
 
·  
Non-GAAP operating income of $32.5 million to $35.5 million;
 
·  
Non-GAAP diluted earnings per share of $0.46 - $0.50;
 
·  
Non-GAAP tax rate to be approximately 28%;
 
·  
The EPS cost of stock-based compensation to be approximately $0.06; and
 
·  
GAAP diluted earnings per share of $0.40 to $0.45. 
 
Plantronics does not intend to update these targets during the quarter or to report on its progress toward these targets.  Plantronics will not comment on these targets to analysts or investors except by its press release announcing its first quarter fiscal 2011 results or by other public disclosure.  Any statements by persons outside Plantronics speculating on the progress of the first quarter fiscal 2011 will not be based on internal Company information and should be assessed accordingly by investors.
 
 
- 4 -
 
 
Conference Call Scheduled to Discuss Actual Financial Results
 
Plantronics has scheduled a conference call to discuss fourth quarter fiscal 2010 results.  The conference call will take place Tuesday, May 4th at 2:00 PM (PDT).  All interested investors and potential investors in Plantronics 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 "Plantronics Conference Call."  Participants from North America should call (888) 301-8736 and other participants should call (706) 634-7260.
 
A replay of the call with the conference ID #55076064 will be available for 72 hours at (800) 642-1687 for callers from North America and at (706) 645-9291 for all other callers.  The conference call will also be simultaneously web cast at www.plantronics.com under Investor Relations, and the web cast of the conference call will remain available at the Plantronics website for thirty days.
 
Use of Non-GAAP Financial Information
 
Plantronics excludes non-recurring transactions and non-cash expenses and charges such as restructuring and other related charges, the release of certain tax reserves, stock-based compensation expenses related to stock options, stock awards and employee stock purchases, purchase accounting amortization and impairment of goodwill and long-lived assets from non-GAAP income from continuing operations, non-GAAP earnings per diluted share from continuing operations, non-GAAP operating income, non-GAAP gross margin, non-GAAP operating margin and non-GAAP effective tax rate on continuing operations.  Plantronics excludes these expenses from its non-GAAP measures primarily because Plantronics does not believe they are reflective of ongoing operating results and are not considered by management as part of its target operating model.  Plantronics believes that the use of non-GAAP financial measures provides meaningful supplemental information regarding its performance and liquidity, and helps investors compare actual results to its long-term target operating model goals.  Plantronics believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing its performance and when planning, forecasting and analyzing future periods.
 
Safe Harbor
 
This release contains forward-looking statements within the meaning of Section 27A of the Securities Exchange Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements relating to (i) our estimates of GAAP and non-GAAP financial results for the first quarter of fiscal 2011, including revenue, operating income and earnings per share; (ii) our estimated tax rate for the first quarter of fiscal 2011; (iii) our estimated stock-based compensation expense for the first quarter of fiscal 2011; (iv) our long term prospects with respect to the UC opportunities and our market growth opportunities with regard to all of our product lines, as well as other matters discussed in this press release that are not purely historical data.  Plantronics does 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:
 
·  
economic conditions in both the domestic and international markets;
 
·  
fluctuations in foreign exchange rates;
 
·  
the bankruptcy or financial weakness of distributors or key customers, or the bankruptcy of or reduction in capacity of our key suppliers;
 
·  
our ability to realize our Unified Communications (“UC”) plans and to achieve the financial results projected to arise from UC adoption could be adversely affected by the following factors: (i) as UC becomes more widely adopted, the risk that competitors will offer solutions that will effectively commoditize our headsets which, in turn, will reduce the sales prices for our headsets; (ii) our plans are dependent upon adoption of our UC solution by major platform providers such as Microsoft, Avaya, IBM and Cisco, and we have a limited ability to influence such providers with respect to the functionality of their platforms, their rate of deployment, and their willingness to integrate their platforms with our solutions; (iii) the development of UC solutions is technically complex and this may delay or obstruct our ability to introduce solutions to the market on a timely basis and that are cost effective, feature rich, stable and attractive to our customers; (iv) as UC becomes more widely adopted we anticipate that competition for market share will increase, and some competitors may have superior technical and economic resources; (v) UC solutions may not be adopted with the breadth and speed in the marketplace that we currently anticipate, and (vi) our support expenditures may substantially increase over time  due to the complex nature of the platforms developed by the major UC providers as these platforms continue to evolve and become more commonly adopted;
 
·  
failure to match production to demand given long lead times and the difficulty of forecasting unit volumes and acquiring the component parts to meet demand without having excess inventory or incurring cancellation charges;
 
·  
further impairment losses on the carrying value of our intangible assets and goodwill could be recognized if it is determined the value is not recoverable which would adversely affect our financial results;
 
·  
volatility in prices from our suppliers, including our manufacturers located in China, have and could negatively affect our profitability and/or market share; and
 
·  
additional risk factors including: interruption in the supply of sole-sourced critical components, continuity of component supply at costs consistent with our plans, the inherent risks of our substantial foreign operations, and problems which might affect our manufacturing facilities in Mexico, and unexpected delays and uncertainties affecting our ability to realize targeted expense reductions and annualized savings by outsourcing the manufacturing of our Bluetooth products in China to GoerTek, Inc.
 
For more information concerning these and other possible risks, please refer to the Company’s Annual Report on Form 10-K filed May 26, 2009, quarterly reports filed on Form 10-Q and other filings with the Securities and Exchange Commission as well as recent press releases.  These filings can be accessed over the Internet at http://www.sec.gov/edgar/searchedgar/companysearch.html.
 
Financial Summaries
 
The following related charts are provided:
 
 
About Plantronics

Plantronics is a world leader in personal audio communications for professionals and consumers. From unified communication solutions to Bluetooth headsets, Plantronics delivers unparalleled audio experiences and quality that reflect our nearly 50 years of innovation and customer commitment.  Plantronics is used by every company in the Fortune 100 and is the headset of choice for air traffic control, 911 dispatch and the New York Stock Exchange.  For more information, please visit www.plantronics.com or call (800) 544-4660.
 
Plantronics, the logo design, and Clarity are trademarks or registered trademarks of Plantronics, Inc.  The Bluetooth name and the Bluetooth trademarks are owned by Bluetooth SIG, Inc. and are used by Plantronics, Inc. under license.  All other trademarks are the property of their respective owners.
 
###
 

PLANTRONICS, INC. / 345 Encinal Street / P.O. Box 1802 / Santa Cruz, California 95061-1802
831-426-6060 / Fax 831-426-6098
 
 
  - 5 -
 

                         
PLANTRONICS, INC.
  
 
($ in thousands, except per share data)
  
                         
 
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
 
                    
                         
   
Three Months Ended
    
Twelve Months Ended
   
March 31,
    
March 31,
  
   
2009
    
2010
    
2009
    
2010
  
                         
Net revenues
$
           128,098
  
$
           162,282
  
$
           674,590
  
$
           613,837
  
Cost of revenues
  
             78,500
    
             74,516
    
           382,659
    
           312,767
  
Gross profit
  
             49,598
    
             87,766
    
           291,931
    
           301,070
  
   Gross profit %
  
38.7
 %   
54.1
 %   
43.3
 %   
49.0
 % 
                         
Research, development and engineering
  
             13,119
    
             15,793
    
             63,840
    
             57,784
  
Selling, general and administrative
  
             31,791
    
             40,185
    
           155,678
    
           143,784
  
Restructuring and other related charges
  
             10,664
    
                  100
    
             10,952
    
               1,867
  
   Total operating expenses
  
             55,574
    
             56,078
    
           230,470
    
           203,435
  
    Operating income (loss)
  
              (5,976)
    
             31,688
    
             61,461
    
             97,635
  
    Operating income (loss) %
  
(4.7)
 %   
19.5
 %   
9.1
 %   
15.9
 % 
                         
Interest and other income (expense), net
  
                 (415)
    
                 (548)
    
              (3,544)
    
               3,105
  
Income (loss) from continuing operations before income taxes
              (6,391)
    
             31,140
    
             57,917
    
           100,740
  
Income tax expense from continuing operations
  
               1,111
    
               6,725
    
             12,575
    
             24,287
  
   Income (loss) from continuing operations, net of tax
  
              (7,502)
    
             24,415
    
             45,342
    
             76,453
  
Discontinued operations:
                        
   Income (loss) from operations of discontinued AEG segment (including loss on sale of AEG)
              (5,412)
    
                  394
    
          (142,633)
    
            (29,898)
  
   Income tax expense (benefit) on discontinued operations
  
              (1,882)
    
                  228
    
            (32,392)
    
            (11,180)
  
   Income (loss) on discontinued operations
  
              (3,530)
    
                  166
    
          (110,241)
    
            (18,718)
  
    Net income (loss)
$
            (11,032)
  
$
             24,581
  
$
            (64,899)
  
$
             57,735
  
                         
    % of net revenues
  
(8.6)
 %   
15.1
 %   
(9.6)
 %   
9.4
 % 
                         
Earnings (loss) per common share:
                        
    Basic
                        
        Continuing operations
$
                (0.15)
  
$
                 0.51
  
$
                 0.93
  
$
                 1.58
  
        Discontinued operations
$
                (0.07)
  
$
                 0.00
  
$
                (2.27)
  
$
                (0.39)
  
            Net income (loss)
$
                (0.23)
  
$
                 0.51
  
$
                (1.34)
  
$
                 1.19
  
                         
    Diluted
                        
        Continuing operations
$
                (0.15)
  
$
                 0.49
  
$
                 0.93
  
$
                 1.55
  
        Discontinued operations
$
                (0.07)
  
$
                 0.00
  
$
                (2.25)
  
$
                (0.38)
  
            Net income (loss)
$
                (0.23)
  
$
                 0.50
  
$
                (1.33)
  
$
                 1.17
  
                         
Shares used in computing earnings (loss) per share:
                        
    Basic
  
             48,431
    
             48,146
    
             48,589
    
             48,504
  
    Diluted
  
             48,431
    
             49,562
    
             48,947
    
             49,331
  
                         
Tax rate from continuing operations
  
(17.4)
 %   
21.6
 %   
21.7
 %   
24.1
 % 
 
                        

 
  - 6 -
 
 
 
             
PLANTRONICS, INC.
  
SUMMARY CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
  
($ in thousands, except per share data)
  
             
             
UNAUDITED CONSOLIDATED BALANCE SHEETS
            
             
   
March 31,
    
March 31,
  
   
2009
    
2010
  
ASSETS
            
Cash and cash equivalents
   $ 158,193     $ 349,961  
Short-term investments
     59,987       19,231  
Total cash, cash equivalents, and short-term investments
     218,180       369,192  
Accounts receivable, net
     83,657       88,898  
Inventory, net
     119,296       70,518  
Deferred income taxes
     12,486       10,911  
Other current assets
     29,936       21,568  
Assets held for sale
     -       8,861  
Total current assets
     463,555       569,948  
Long-term investments
     23,718       -  
Property, plant and equipment, net
     95,719       65,700  
Intangibles, net
     26,575       3,449  
Goodwill
     14,005       14,005  
Other assets
     9,548       2,605  
Total assets
   $ 633,120     $ 655,707  
                 
LIABILITIES AND STOCKHOLDERS' EQUITY
                
Accounts payable
   $ 32,827     $ 23,779  
Accrued liabilities
     53,143       45,837  
Total current liabilities
     85,970       69,616  
Deferred tax liability
     8,085       551  
Long-term income taxes payable
     12,677       12,926  
Other long-term liabilities
     1,021       924  
Total liabilities
     107,753       84,017  
Stockholders' equity
     525,367       571,690  
Total liabilities and stockholders' equity
   $ 633,120     $ 655,707  
 
                

 
  - 7 -
 

                                       
PLANTRONICS, INC.
  
 
($ in thousands, except per share data)
  
                                       
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS 
  
 
  
 
                    
     
Three Months Ended
    
Twelve Months Ended
  
     
March 31, 2010
    
March 31, 2010
  
     
GAAP
    
Excluded
  
Non-GAAP
  
GAAP
    
Excluded
  
Non-GAAP
                                       
Net revenues
   $ 162,282     $ -     $ 162,282     $ 613,837     $ -     $ 613,837  
Cost of revenues
     74,516       (745 )  (1)   73,771       312,767       (7,947 )  (2)   304,820  
Gross profit
     87,766       745       88,511       301,070       7,947       309,017  
    Gross profit %
       54.1 %             54.5 %     49.0 %             50.3 %
                                                   
Research, development and engineering
     15,793       (951 )  (1)   14,842       57,784       (3,404 )  (1)   54,380  
Selling, general and administrative
     40,185       (2,364 )  (1)   37,821       143,784       (8,799 )  (1)   134,985  
Restructuring and other related charges
     100       (100 )  (3)   -       1,867       (1,867 )  (3)   -  
    Total operating expenses
 
     56,078       (3,415 )     52,663       203,435       (14,070 )     189,365  
       Operating income
 
     31,688       4,160       35,848       97,635       22,017       119,652  
       Operating income %
 
     19.5 %             22.1 %     15.9 %             19.5 %
                                                   
Interest and other income (expense), net
     (548 )     -       (548 )     3,105       -       3,105  
Income from continuing operations before income taxes
     31,140       4,160       35,300       100,740       22,017       122,757  
Income tax expense from continuing operations
     6,725       2,404    (4)   9,129       24,287       7,230    (5)   31,517  
    Income from continuing operations, net of tax
 
   $ 24,415     $ 1,756     $ 26,171     $ 76,453     $ 14,787     $ 91,240  
                                                   
    % of net revenues
 
     15.0 %             16.1 %     12.5 %             14.9 %
                                                   
Diluted earnings per common share from continuing operations
   $ 0.49             $ 0.53     $ 1.55             $ 1.85  
Shares used in diluted per share calculations
     49,562               49,562       49,331               49,331  
                                                   
                                                   
                                                   
(1) Excluded amount represents stock-based compensation and purchase accounting amortization.    
(2) Excluded amount represents stock-based compensation, purchase accounting amortization and $5,205 of accelerated depreciation on assets related to restructuring activity.
(3) Excluded amount represents restructuring and other related charges.
(4) Excluded amount represents tax benefit from stock-based compensation, purchase accounting amortization and restructuring and other related charges and $1,061 related to a tax benefit from expiration
    of certain statutes of limitations.    
(5) Excluded amount represents tax benefit from stock-based compensation, purchase accounting amortization and restructuring and other related charges and $2,217 related to a tax benefit from expiration
    of certain statutes of limitations. 
                                                     
Use of Non-GAAP Financial Information
                                                
To supplement our consolidated financial statements presented on a GAAP basis, Plantronics uses non-GAAP measures of operating results from continuing operations, which are adjusted to exclude non-recurring and non-cash expenses and charges, such as restructuring and other related charges, certain tax credits and the release of certain tax reserves, stock-based compensation expenses related to stock options, awards and employee stock purchases, purchase accounting amortization and impairment of goodwill and long-lived assets. Plantronics does not believe these expenses and charges are reflective of ongoing operating results and are not part of our target operating model. We have presented non-GAAP statements that only show our results to the income from continuing operations after tax line. The non-GAAP financial measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and the reconciliations to those financial statements should be carefully evaluated.  The non-GAAP financial measures used by Plantronics may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies.

 
- 8 - 
 
 
 
                                       
PLANTRONICS, INC.
  
UNAUDITED GAAP TO NON-GAAP RECONCILIATION
  
($ in thousands, except per share data)
  
                                       
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS 
  
 
  
 
                    
     
Three Months Ended
    
Twelve Months Ended
  
     
March 31, 2009
    
March 31, 2009
  
     
GAAP
    
Excluded
  
Non-GAAP
  
GAAP
    
Excluded
  
Non-GAAP
                                       
Net revenues
   $ 128,098     $ -     $ 128,098     $ 674,590     $ -     $ 674,590  
Cost of revenues
     78,500       (666)    (1)   77,834       382,659       (3,215)    (1)   379,444  
Gross profit
     49,598       666       50,264       291,931       3,215       295,146  
    Gross profit %
       38.7 %             39.2 %     43.3 %             43.8 %
                                                   
Research, development and engineering
     13,119       (872)    (1)   12,247       63,840       (3,687)    (1)   60,153  
Selling, general and administrative
     31,791       (2,162)    (1)   29,629       155,678       (9,551)    (1)   146,127  
Restructuring and other related charges
     10,664       (10,664)    (2)   -       10,952       (10,952)    (2)   -  
    Total operating expenses
 
     55,574       (13,698)       41,876       230,470       (24,190)       206,280  
       Operating income (loss)
 
     (5,976)       14,364       8,388       61,461       27,405       88,866  
       Operating income (loss) %
 
     (4.7) %             6.5 %     9.1 %             13.2 %
                                                   
Interest and other income (expense), net
     (415)       -       (415)       (3,544)       -       (3,544)  
Income (loss) from continuing operations before income taxes
     (6,391)       14,364       7,973       57,917       27,405       85,322  
Income tax expense from continuing operations
     1,111       3,285    (3)   4,396       12,575       11,195    (4)   23,770  
    Income (loss) from continuing operations, net of tax
 
   $ (7,502)     $ 11,079     $ 3,577     $ 45,342     $ 16,210     $ 61,552  
                                                   
    % of net revenues
 
     (5.9) %             2.8 %     6.7 %             9.1 %
                                                   
Diluted earnings (loss) per common share from continuing operations
   $ (0.15)             $ 0.07     $ 0.93             $ 1.26  
Shares used in diluted per share calculations
     48,431               48,431       48,947               48,947  
                                                   
                                                   
                                                   
(1) Excluded amount represents stock-based compensation and purchase accounting amortization.    
(2) Excluded amount represents restructuring and other related charges.
(3) Excluded amount represents tax benefit from stock-based compensation, purchase accounting amortization and restructuring and other related charges.
(4) Excluded amount represents tax benefit from stock-based compensation, purchase accounting amortization and restructuring and other related charges and $3,813 related to a tax benefit from expiration
    of certain statutes of limitations. 
                                                     
Use of Non-GAAP Financial Information
                                                
To supplement our consolidated financial statements presented on a GAAP basis, Plantronics uses non-GAAP measures of operating results from continuing operations, which are adjusted to exclude non-recurring and non-cash expenses and charges, such as restructuring and other related charges, certain tax credits and the release of certain tax reserves, stock-based compensation expenses related to stock options, awards and employee stock purchases, purchase accounting amortization and impairment of goodwill and long-lived assets. Plantronics does not believe these expenses and charges are reflective of ongoing operating results and are not part of our target operating model. We have presented non-GAAP statements that only show our results to the income from continuing operations after tax line. The non-GAAP financial measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and the reconciliations to those financial statements should be carefully evaluated.  The non-GAAP financial measures used by Plantronics may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies.


 
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($ in thousands, except per share data)
                          
                                                             
      Q109       Q209       Q309       Q409    
FY09
       Q110       Q210       Q310       Q410    
FY10
  
Net revenues
   $ 198,527     $ 195,349     $ 152,616     $ 128,098     $ 674,590     $ 141,162     $ 144,458     $ 165,935     $ 162,282     $ 613,837  
Cost of revenues
     108,449       101,720       91,441       77,834       379,444       72,036       74,145       84,868       73,771       304,820  
Gross profit
     90,078       93,629       61,175       50,264       295,146       69,126       70,313       81,067       88,511       309,017  
Gross profit %
     45.4 %     47.9 %     40.1 %     39.2 %     43.8 %     49.0 %     48.7 %     48.9 %     54.5 %     50.3 %
                                                                                 
Research, development and engineering
     16,204       15,878       15,824       12,247       60,153       12,850       12,733       13,955       14,842       54,380  
Selling, general and administrative
     40,369       39,774       36,355       29,629       146,127       31,058       30,823       35,283       37,821       134,985  
Operating expenses
     56,573       55,652       52,179       41,876       206,280       43,908       43,556       49,238       52,663       189,365  
                                                                                 
Operating income
     33,505       37,977       8,996       8,388       88,866       25,218       26,757       31,829       35,848       119,652  
Operating income %
     16.9 %     19.4 %     5.9 %     6.5 %     13.2 %     17.9 %     18.5 %     19.2 %     22.1 %     19.5 %
                                                                                 
Income from continuing operations
                                                                                
    before income taxes       35,045        34,807        7,497        7,973        85,322        26,565        27,641        33,251        35,300        122,757  
Income tax expense from continuing
                                                                                
    operations       8,763        10,118        493        4,396        23,770        7,172        6,939        8,277        9,129        31,517  
Income tax expense as a percent
                                                                                
    of income from continuing
                                                                                
    operations before taxes       25.0 %       29.1 %       6.6 %       55.1 %       27.9 %       27.0 %       25.1 %       24.9 %       25.9 %       25.7 % 
                                                                                 
Income from continuing operations, net
                                                                                
    of tax    $   26,282     $   24,689     $   7,004     $   3,577     $   61,552     $   19,393     $   20,702     $   24,974     $   26,171     $   91,240  
                                                                                 
Diluted EPS - continuing operations
   $ 0.53     $ 0.50     $ 0.14     $ 0.07     $ 1.26     $ 0.40     $ 0.42     $ 0.50     $ 0.53     $ 1.85  
Diluted shares outstanding
     49,245       49,489       48,522       48,431       48,947       48,665       49,567       49,625       49,562       49,331  
                                                                                 
Net revenues from unaffiliated customers:
                                  
  Office and Contact Center
   $ 122,803     $ 119,530     $ 101,694     $ 85,642     $ 429,669     $ 95,923     $ 93,503     $ 103,096     $ 111,875     $ 404,397  
  Mobile
     59,882       60,911       36,011       30,615       187,419       32,310       34,665       46,951       35,830       149,756  
  Gaming and Computer Audio
     9,621       8,977       8,531       6,923       34,052       8,810       9,015       11,072       10,363       39,260  
  Clarity
     6,221       5,931       6,380       4,918       23,450       4,119       7,275       4,816       4,214       20,424  
                                                                                 
Net revenues by geographic area
                                                                                
 from unaffiliated customers:
                                                                                
   Domestic
   $ 123,603     $ 129,789     $ 91,594     $ 79,304     $ 424,290     $ 88,789     $ 93,370     $ 99,157     $ 96,803     $ 378,119  
   International
     74,924       65,560       61,022       48,794       250,300       52,373       51,088       66,778       65,479       235,718  
                                                                                 
Balance Sheet accounts and metrics:
                                                                                
Accounts receivable, net 1
   $ 130,530     $ 115,032     $ 106,463     $ 83,657     $ 83,657     $ 88,350     $ 103,003     $ 113,291     $ 88,898     $ 88,898  
Days sales outstanding (DSO) 1
     59       53       63       59               56       64       61       49          
Inventory, net 2
   $ 116,379     $ 135,736     $ 114,423     $ 100,171     $ 100,171     $ 90,258     $ 78,026     $ 70,914     $ 70,518     $ 70,518  
Inventory turns 2
     3.7       3.0       3.2       3.1               3.2       3.8       4.8       4.2          
                                                                                 
1  Accounts receivable, net is presented on a consolidated basis including discontinued operations as Plantronics does not maintain balance by segment; DSO is calculated on revenues from
  
    continuing operations and consolidated Accounts receivable.   
2 Inventory, net and inventory turns reflect amounts in continuing operations only.
  
 
                                                                                
                                      
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