Poly Announces Second Quarter Fiscal Year 2020 Financial Results
SANTA CRUZ, Calif., Nov. 5, 2019 /PRNewswire/ -- Plantronics, Inc. (NYSE: PLT) ("Poly" or the "Company") today announced second quarter fiscal year 2020 results for the period ending September 30, 2019. Highlights of the second quarter include the following:
($ Millions, except percent and per-share data)(1) Q2 FY20 Q2 FY19 YTD FY20 YTD FY19(2)
GAAP Revenue $462 $483 $909 $704
GAAP Gross Margin 44.6 31.6 46.0 37.3
% % % %
GAAP Operating Income ($6) ($86) ($34) ($65)
GAAP Diluted EPS ($0.65) ($2.21) ($1.80) ($2.01)
Cash Flow from Operations $25 $40 $34 $73
Non-GAAP Revenue $470 $520 $930 $741
Non-GAAP Gross Margin 52.4 53.2 54.1 52.3
% % % %
Non-GAAP Operating Income $81 $96 $167 $132
Non-GAAP Diluted EPS $1.24 $1.51 $2.55 $2.31
Adjusted EBITDA(3) $93 $108 $191 $149
(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.
(3) Trailing twelve months Adjusted
EBITDA of $399 million.
"In light of the challenges of the past two quarters we are aggressively taking steps to drive long-term profitable growth," said Joe Burton, President and Chief Executive Officer. "Over the last few months we have announced a record number of new products that are just beginning to ship now with the full rollout over the next few quarters."
Results Compared to August 6, 2019 Guidance
Q2 FY20 Results
Q2 FY20 Guidance Range(3)
GAAP Net
Revenue
$462M
$456M - $496M
Non-GAAP
Net
Revenue
$470M
$465M - $505M
Adjusted
EBITDA
$93M
$94M - $110M
Non-GAAP
Diluted
EPS $1.24
$1.20 - $1.50
3 The non-GAAP revenue
guidance ranges shown here
exclude the $8.5 million
impact of purchase
accounting related to
recording deferred revenue
at fair value at the time of
the acquisition.
"During the second quarter, we made further progress reducing our debt and managing corporate spend," said Chuck Boynton, Executive Vice President and Chief Financial Officer. "As we analyze inventory levels across our value chain, in light of the evolving macroeconomic conditions and significant product transitions underway, we believe it is prudent to reduce channel inventory at this time by reducing sales to channel partners. This reduction will primarily impact our fiscal Q3 results and is incorporated into the guidance we are providing today."
Highlights for the Second Quarter and Fiscal Year 2020
-- At Zoom's annual user conference, Poly announced the Studio X family,
two new purpose-built all-in-one video bars designed to dramatically
simplify the video conferencing experience. Combined with the Poly
Studio and Poly G7500 the Company now has a full portfolio of
software-driven video endpoints positioned to capture the rapid growth
in the video conferencing market.
-- At Microsoft Ignite, Poly announced the CCX line of business desk
phones, combining Microsoft Teams with premium voice quality. All CCX
phones integrate Teams contact lists, calendars, meetings, and a
dedicated Teams button for activating Cortana skills. The Company also
announced that Poly Studio, Trio family, CCX phones, Calisto
speakerphones, and Voyager 4200/5200 are now certified for Microsoft
Teams.
-- Tata Communications and Poly will offer a range of managed services to
support enterprises on their entire Microsoft Teams transition.
-- 8x8, ScanSource, and Poly are joining forces to launch CloudFuel, a
program designed to accelerate and simplify the process of transitioning
from legacy on-premise communication systems to cloud-based solutions.
-- Poly introduced the next generation of the Company's lineup of popular
Savi wireless headsets. The enhanced Savi Office and UC Series offer
more wearing styles, a unique close conversation limiting feature and
active noise canceling (ANC).
-- Poly announced that multiple headsets are now certified to work with
Google Voice for G Suite, the new cloud-based business telephony service
built for G Suite customers.
-- Amazon Alexa for Business is now built into the Voyager 5200 and Voyager
4200 UC Series. Tile is also now integrated into these headsets,
allowing users to "ring" and locate the headset when its been misplaced.
-- Poly introduced an all-new true wireless lineup to its award-winning
BackBeat line. These true wireless earbuds are extremely lightweight,
and each pair comes with a compact carrying case, which includes
additional charging capabilities.
-- The Company made a debt repayment of $25 million against its outstanding
Term Loan B.
-- Poly Investor Day is scheduled for November 20, 2019. The morning event
is specifically designed for institutional investors and equity
analysts.
For the full lineup of product announcements in the quarter, please see Poly's corporate blog at poly.blog.com.
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 December 10, 2019, to all shareholders of record as of the close of market on November 20, 2019.
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.
In its fiscal third quarter, the Company expects to reduce channel inventory by approximately $65 million by reducing sales to channel partners, and has adjusted its financial guidance accordingly. The following represents the expected range of financial results for the third quarter and full fiscal year of 2020 (all amounts assuming currency rates remain stable):
Q3 FY20 Guidance
FY20 Annual Guidance
GAAP Net
Revenue
$383M - $423M
$1.72B - 1.81B
Non-GAAP Net
Revenue(1)
$390M - $430M
$1.76B - $1.84B
Adjusted
EBITDA(2)
$33M - $53M
$283M - $323M
Non-GAAP
Diluted
EPS2,3
$0.01 - $0.31
$2.94 - $3.74
1 Q3 and full year FY20 non-GAAP
revenue guidance excludes
anticipated purchase accounting
adjustments of $7.1 million and
$34.0 million, respectively.
2 Q3 and full year FY20 Adjusted
EBITDA and non-GAAP diluted EPS
excludes estimated intangibles
amortization expense of $45.8
million and $182.8 million,
respectively. 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
40 million diluted average weighted
shares and a non-GAAP effective
tax rate of 16% to 18%.
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 and historical combined comparative results is provided at the end of this press release.
We have scheduled a conference call to discuss second quarter fiscal year 2020 financial results. The conference call will take place today, November 5, 2019, 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 #4337595 will be available until January 5, 2020 at (855) 859-2056 for callers from North America and at (404) 537-3406 for all other callers.
Use of Non-GAAP and Combined Comparative Financial Information
To supplement our condensed consolidated financial statements presented on a GAAP basis, we use non-GAAP, and where applicable, combined comparative 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, which exclude certain unusual or non-cash expenses and charges that are included in the most directly comparable GAAP measure. These unusual or non-cash expenses and charges include the effect, where applicable, of purchase accounting on deferred revenue and inventory, stock-based compensation, acquisition related expenses, purchase accounting amortization and adjustments, restructuring and other related charges and credits, asset impairments, executive transition charges, rebranding costs, gains or losses from litigations settlements, unusual and/or irregular gains or losses from the sale of investments, 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 exclude these amounts from our non-GAAP and combined comparative measures primarily because management does not believe they are consistent with the development of our target operating model. Combined comparative results refer to the results for periods prior to the acquisition of Polycom, which were prepared by combining the non-GAAP results of as if they had been combined during that period. These prior period results are presented on a non-GAAP as-reported basis, with immaterial adjustments to align the treatment of non-GAAP adjustments for comparative purposes. We believe that the use of non-GAAP and combined comparative 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 and combined comparative financial measures in assessing our performance and when planning, forecasting and analyzing future periods; however, non-GAAP and combined comparative 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 drive long-term profitable growth; (ii) our expectations for new products launches, the timing of their releases and their expected impact on future growth; (iii) our expectations to reduce channel inventory materially in third quarter of Fiscal Year 2020; (iv) our expectations for operating cash flow and debt; (v) estimates of GAAP and non-GAAP financial results for the third quarter and full year Fiscal Year 2020, including net revenues, purchase accounting adjustments, adjusted EBITDA, tax rates, intangibles amortization, and diluted weighted average shares outstanding and diluted EPS, 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 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; and (x) the potential that our due diligence did not uncover
risks and potential liabilities of Polycom;
-- Micro and macro-economic conditions in our domestic and international
markets;
-- 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, 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;
-- forecasting sales and procurement demands is 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; and
-- seasonality in one or more of our product categories.
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
-- Unaudited Reconciliations of GAAP Measures to Trailing Twelve Months
EBITDA
-- Unaudited Reconciliations of GAAP Measures to Non-GAAP Combined
Comparative 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
Six Months Ended
September 30,
September 30,
2019 2018 2019 2018
Net revenues:
Net product revenues $
395,137 $
435,262 $
777,882 $
656,571
Net services revenues 66,572 47,807 131,594 47,807
Total net revenues 461,709 483,069 909,476 704,378
Cost of revenues:
Cost of product revenues 229,323 305,477 437,939 416,943
Cost of service revenues 26,315 24,963 52,820 24,963
Total cost of revenues 255,638 330,440 490,759 441,906
Gross profit 206,071 152,629 418,717 262,472
Gross profit % 44.6 31.6 46.0 37.3
%
%
%
%
Operating expenses:
Research, development, and
engineering 57,415 57,047 116,939 80,748
Selling, general, and
administrative 148,419 174,297 312,027 238,500
(Gain) loss, net from
litigation settlements (1,162) (30)
Restructuring and other related
charges 5,847 7,261 25,372 8,581
Total operating expenses 211,681 238,605 453,176 327,799
Operating income (5,610) (85,976) (34,459) (65,327)
Operating income % (1.2) (17.8) (3.8) (9.3)
%
%
%
%
Interest expense (23,797) (23,893) (47,729) (31,220)
Other non-operating income,
net (625) 1,610 (292) 3,606
Income before income taxes (30,032) (108,259) (82,480) (92,941)
Income tax expense (benefit) (4,122) (21,550) (11,699) (20,703)
Net income (loss) $
(25,910) $
(86,709) $
(70,781) $
(72,238)
% of net revenues (5.6) (17.9) (7.8) (10.3)
%
%
%
%
Earnings per common share:
Basic $
(0.65) $
(2.21) $
(1.80) $
(2.01)
Diluted $
(0.65) $
(2.21) $
(1.80) $
(2.01)
Shares used in computing
earnings per common share:
Basic 39,584 39,281 39,411 35,938
Diluted 39,584 39,281 39,411 35,938
Effective tax rate (13.7) (19.9) (14.2) (22.3)
%
%
%
%
---
PLANTRONICS, INC.
SUMMARY CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
($ in thousands)
UNAUDITED CONSOLIDATED BALANCE SHEETS
September 30, March 31,
2019 2019
ASSETS
Cash and cash equivalents $
186,442 $
202,509
Short-term investments 14,378 13,332
Total cash, cash equivalents, and
short-term investments 200,820 215,841
Accounts receivable, net 337,077 337,671
Inventory, net 228,363 177,146
Other current assets 55,160 50,488
Total current assets 821,420 781,146
Property, plant, and equipment, net 186,638 204,826
Purchased intangibles, net 734,355 825,675
Goodwill 1,279,897 1,278,380
Deferred tax and other assets 89,704 26,508
Total assets $
3,112,014 $
3,116,535
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable $
169,701 $
129,514
Accrued liabilities 427,647 398,715
Total current liabilities 597,348 528,229
Long-term debt, net of issuance costs 1,619,015 1,640,801
Long-term income taxes payable 92,831 83,121
Other long-term liabilities 143,713 142,697
Total liabilities 2,452,907 2,394,848
Stockholders' equity 659,107 721,687
Total liabilities and stockholders'
equity $
3,112,014 $
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
Six Months Ended
September 30,
September 30,
2019 2018 2019 2018
Cash flows from operating
activities
Net Income $
(25,910) $
(86,709) $
(70,781) $
(72,238)
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 57,376 82,398 115,074 87,646
Amortization of debt issuance cost 1,361 1,407 2,722 1,769
Stock-based compensation 14,693 10,840 27,597 18,990
Deferred income taxes (15,657) (22,688) (48,802) (18,056)
Provision for excess and obsolete
inventories 1,844 2,196 3,604 2,808
Restructuring charges 5,847 7,261 25,372 8,581
Cash payments for restructuring
charges (5,291) (6,560) (22,949) (7,395)
Other operating activities 6,929 9,284 8,894 9,010
Changes in assets and liabilities:
Accounts receivable, net (17,667) (29,165) 3,778 (23,863)
Inventory, net (13,275) 16,780 (55,584) 16,380
Current and other assets (6,146) (5,674) 9,352 (2,693)
Accounts payable (1,482) 14,939 34,910 20,627
Accrued liabilities 14,168 46,805 (29,616) 39,505
Income taxes 8,427 (646) 29,995 (8,521)
Cash provided by operating
activities $
25,217 $
40,468 $
33,566 $
72,550
Cash flows from investing
activities
Proceeds from sale of investments 170 124,640
Proceeds from maturities of
investments 131,017
Purchase of investments (155) (142) (806) (536)
Acquisitions, net of cash acquired (1,616,692) (1,650,242)
Capital expenditures (4,753) (3,667) (9,260) (7,535)
Proceeds from sale of property and
equipment 2,142 2,142
Cash provided by (used for)
investing activities $
(2,766) $
(1,620,501) $
(7,754) $
(1,402,656)
Cash flows from financing
activities
Employees' tax withheld and paid
for restricted stock and
restricted stock units (660) (307) (9,281) (13,342)
Proceeds from issuances under
stock-based compensation plans 6,027 4,314 6,616 14,872
Repayments of long-term debt (25,000) (25,000)
Proceeds from debt issuance, net 1,244,713 1,244,713
Payment of cash dividends (5,982) (5,968) (11,922) (10,982)
Cash used for financing activities $
(25,615) $
1,242,752 $
(39,587) $
1,235,261
Effect of exchange rate changes on
cash and cash equivalents (2,298) (2,675) (2,292) (4,730)
Net increase (decrease) in cash and
cash equivalents (5,462) (339,956) (16,067) (99,575)
Cash and cash equivalents at
beginning of period 191,904 631,042 202,509 390,661
Cash and cash equivalents at end of
period $
186,442 $
291,086 $
186,442 $
291,086
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
Six Months Ended
September 30,
September 30,
2019 2018 2019 2018
GAAP Net revenues $
461,709 $
483,069 $
909,476 $
704,378
Deferred revenue purchase
accounting 8,524 36,585 20,683 36,585
Non-GAAP Net revenues $
470,233 $
519,654 $
930,159 $
740,963
GAAP Gross profit $
206,071 $
152,629 $
418,717 $
262,472
Purchase accounting
amortization 30,716 55,668 60,716 55,668
Inventory valuation
adjustment - 30,395 30,395
Deferred revenue purchase
accounting 8,524 36,585 20,683 36,585
Acquisition and
integration fees 88 217 1,010 217
Stock-based compensation 997 1,073 1,975 2,036
Rebranding costs 23 59
Non-GAAP Gross profit $
246,419 $
276,567 $
503,160 $
387,373
Non-GAAP Gross profit % 52.4 53.2 54.1 52.3
%
%
%
%
GAAP Research,
development, and
engineering $
57,415 $
57,047 $
116,939 $
80,748
Stock-based compensation (4,213) (2,768) (7,932) (4,990)
Acquisition and
integration fees (560) (56) (1,901) (56)
Other adjustments (542) (542)
Non-GAAP Research,
development, and
engineering $
52,100 $
54,223 $
106,564 $
75,702
GAAP Selling, general,
and administrative $
148,419 $
174,297 $
312,027 $
238,500
Acquisition and
integration fees (10,009) (25,980) (28,181) (31,783)
Purchase accounting
amortization (15,278) (15,279) (30,556) (15,279)
Stock-based compensation (9,483) (6,999) (17,690) (11,964)
Rebranding costs (649) (6,068)
Non-GAAP Selling,
general, and
administrative $
113,000 $
126,039 $
229,532 $
179,474
GAAP Operating expenses $
211,681 $
238,605 $
453,176 $
327,799
Acquisition and
integration fees (10,569) (26,036) (30,082) (31,839)
Purchase accounting
amortization (15,278) (15,279) (30,556) (15,279)
Stock-based compensation (13,696) (9,767) (25,622) (16,954)
Restructuring and other
related charges (5,847) (7,261) (25,372) (8,581)
Rebranding costs (649) (6,068)
Other adjustments (542) 620
Non-GAAP Operating
expenses $
165,100 $
180,262 $
336,096 $
255,146
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
Six Months Ended
September 30,
September 30,
2019 2018 2019 2018
GAAP Operating income $
(5,610) $
(85,976) $
(34,459) $
(65,327)
Purchase accounting
amortization 45,994 70,947 91,272 70,947
Inventory valuation
adjustment - 30,395 30,395
Deferred revenue
purchase accounting 8,524 36,585 20,683 36,585
Acquisition and
integration fees 10,657 26,253 31,092 32,056
Stock-based
compensation 14,693 10,840 27,597 18,990
Restructuring and
other related charges 5,847 7,261 25,372 8,581
Rebranding costs 672 6,127
Other adjustments 542 (620)
Non-GAAP Operating
income $
81,319 $
96,305 $
167,064 $
132,227
GAAP Net income $
(25,910) $
(86,709) $
(70,781) $
(72,238)
Purchase accounting
amortization 45,994 70,947 91,272 70,947
Inventory valuation
adjustment - 30,395 30,395
Deferred revenue
purchase accounting 8,524 36,585 20,683 36,585
Acquisition and
integration fees 10,657 26,253 31,092 32,056
Stock-based
compensation 14,693 10,840 27,597 18,990
Restructuring and
other related charges 5,847 7,261 25,372 8,581
Rebranding costs 672 6,127
Other adjustments 542 (1) (1) (620) 1, 2
Income tax effect of
above items (12,511) (34,032) (27,994) (38,898)
Income tax effect of
unusual tax items 499 (3) (1,260) 4 (1,519) (3) (1,359) 4
Non-GAAP Net income $
49,006 $
60,280 $
101,229 $
85,059
GAAP Diluted earnings
per common share $
(0.65) $
(2.21) $
(1.80) $
(2.01)
Purchase accounting
amortization 1.16 1.78 2.30 1.93
Inventory valuation
adjustment - 0.76 0.83
Deferred revenue
purchase accounting 0.21 0.92 0.52 0.99
Stock-based
compensation 0.37 0.27 0.70 0.52
Acquisition and
integration fees 0.27 0.66 0.78 0.87
Restructuring and
other related charges 0.15 0.18 0.64 0.23
Rebranding costs 0.02 0.15
Other adjustments 0.01 (0.02)
Income tax effect (0.32) (0.89) (0.75) (1.09)
Effect of
participating
securities -
Effect of anti-
dilutive securities 0.02 0.04 0.03 0.04
Non-GAAP Diluted
earnings per common
share $
1.24 $
1.51 $
2.55 $
2.31
Shares used in diluted earnings per common share calculation:
GAAP 39,584 39,281 39,411 35,938
non-GAAP 39,664 39,920 39,653 36,795
---
(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.
PLANTRONICS, INC.
UNAUDITED RECONCILIATIONS OF GAAP OPERATING INCOME TO ADJUSTED EBITDA
($ in thousands)
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS DATA
Three Months Ended Twelve Months
Ended
September 30, December 31, March 31, June 30, September 30, September 30,
2018 2018 2019 2019 2019 2019
GAAP operating income $
(85,976) $
(24,707) $
(19,259) $
(28,849) $
(5,610) $
(78,425)
Deferred revenue purchase
accounting 36,585 28,923 19,316 12,159 8,524 68,922
Inventory valuation adjustment 30,395
Acquisition and integration
fees 26,253 22,274 14,323 20,435 10,657 67,689
Stock-based compensation 10,840 11,719 11,225 12,904 14,693 50,541
Restructuring and other related
charges 7,261 12,130 11,983 19,525 5,847 49,485
Rebranding costs 5,192 5,455 672 11,319
Other adjustments 1,005 (1,162) 542 385
Depreciation and amortization 82,398 55,117 58,606 57,698 57,376 228,797
Adjusted EBITDA $
107,756 $
105,456 $
102,391 $
98,165 $
92,701 $
398,713
View original content to download multimedia:http://www.prnewswire.com/news-releases/poly-announces-second-quarter-fiscal-year-2020-financial-results-300952198.html
SOURCE Plantronics, Inc.
