SANTA CRUZ, Calif.,
July 28, 2020 /PRNewswire/ -- Plantronics, Inc. (NYSE:
PLT) ("Poly" or the "Company") today announced first quarter
results for the period ending June 27, 2020. Preliminary
highlights of the first quarter include the following:
($ Millions, except
percent and per-share data)1
|
Q1
FY21
|
|
Q1
FY20
|
|
GAAP
Revenue
|
$356
|
|
$448
|
|
GAAP Gross
Margin
|
43.9
|
%
|
47.5
|
%
|
GAAP Operating
Loss
|
($57)
|
|
($29)
|
|
GAAP Diluted
EPS
|
($1.85)
|
|
($1.14)
|
|
Cash Flow from
Operations
|
$42
|
|
$8
|
|
|
|
|
Non-GAAP
Revenue
|
$361
|
|
$460
|
|
Non-GAAP Gross
Margin
|
50.0
|
%
|
55.8
|
%
|
Non-GAAP Operating
Income
|
$37
|
|
$86
|
|
Non-GAAP Diluted
EPS
|
$0.33
|
|
$1.32
|
|
Adjusted
EBITDA
|
$48
|
|
$98
|
|
|
|
|
|
|
|
|
|
|
1
|
For further
information on supplemental non-GAAP metrics refer to the Use of
Non-GAAP Financial Information and Unaudited Reconciliations of
GAAP Measures to Non-GAAP Measures sections below.
|
"We are working aggressively to fulfill elevated headset demand
driven by the hybrid working trend as we navigate product shifts
and supply chain challenges," said Robert
Hagerty, Chairman of the Poly Board of Directors and Interim
Chief Executive Officer. "We continue to make progress on the
transformation necessary to achieve the objectives of the
integrated company and return to profitable growth."
Results Compared
to May 27, 2020 Guidance
|
|
|
|
|
Q1 FY21
Results
|
Q1 FY21 Guidance
Range2
|
GAAP Net
Revenue
|
$356M
|
$330M -
$365M
|
Non-GAAP Net
Revenue
|
$361M
|
$335M -
$370M
|
Adjusted
EBITDA
|
$48M
|
$25M -
$45M
|
Non-GAAP Diluted
EPS
|
$0.33
|
$(0.18) -
$0.22
|
|
|
2
|
The non-GAAP
revenue guidance range shown here excludes the $5.1 million impact
of purchase accounting related to recording deferred revenue at
fair value at the time of the acquisition.
|
"In light of the current macroeconomic uncertainty, we have been
accumulating cash to maximize financial flexibility and liquidity,"
said Charles Boynton, Executive Vice
President and Chief Financial Officer. "As our business and the
economy stabilize, our capital allocation strategy will focus on
reducing leverage while maintaining appropriate liquidity."
Highlights for the First Quarter 2021
- Headsets demand remained elevated and voice solutions
challenged as customers continue to work from home. Backlog at
quarter-end was approximately five weeks.
- The Company's in-house manufacturing site in Tijuana, Mexico resumed production in early
May after reconfiguring to implement specific safety protocols. The
factory is capable of running at full capacity, but supply
constraints continue to affect production.
- Poly announced a new family of Microsoft Teams Rooms (MTR)
solutions and completed the Teams certification of the Studio X30
and X50 video bars. Poly also received Teams re-certification on
six headsets for a total of 16 certified Teams headsets, and now
offers the largest number of Teams certified endpoints in the
market.
- Poly's next-gen video solutions, including the Studio X30,
Studio X50, and G7500 became the first certified Zoom appliances in
the market. In addition, the company announced participation in
Zoom's Hardware-as-a-Service offering featuring Poly video bars and
phones.
- LogMeIn announced that the Poly Studio X30 and X50 video bars
are now available in bundled solutions for GoToRoom.
- The Company resolved several longstanding litigation matters,
which will reduce Legal expenses going forward.
- The Company ended fiscal Q1 with $263
million in cash and short-term investments.
Dividend Suspended
On April 9, 2020, the Poly Board
of Directors suspended the quarterly cash dividend.
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 second quarter 2021 (all amounts assume currency rates
remain stable):
|
Q2 FY21
Guidance
|
GAAP Net
Revenue
|
$346M -
$386M
|
Non-GAAP
Revenue
|
$350M -
$390M
|
Adjusted
EBITDA1
|
$45M -
$65M
|
Non-GAAP Diluted
EPS1,2
|
$0.25 -
$0.65
|
|
|
1
|
Q2 Adjusted EBITDA
and non-GAAP diluted EPS guidance excludes estimated intangibles
amortization expense of $31.4 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, 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.
|
2
|
EPS guidance assumes
approximately 41 million diluted average weighted shares and a
non-GAAP effective tax rate of 15% to 17%.
|
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 webcast to discuss first quarter fiscal year
2021 financial results. The webcast will take place today,
July 28, 2020, at 2:00 PM (Pacific
Time). All interested investors and potential investors in
Poly stock are invited to join. To listen to the webcast, please
access the webcast link from our Investor Relations website at
investor.poly.com.
A replay of the webcast will be available shortly after its
conclusion and can be accessed from our Investor Relations website
at investor.poly.com.
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, 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, impairment charges, 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 press 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 our intentions, beliefs,
projections, outlook, analyses or current expectations that are
subject to many risks and uncertainties. Such forward-looking
statements and the associated risks and uncertainties include, but
are not limited to: (i) our beliefs with respect to the length and
severity of the COVID-19 (coronavirus) outbreak, and its impact
across our businesses, our operations and global supply chain,
including (a) our inability to source component parts from key
suppliers in sufficient quantities necessary to meet the high
demand for certain product lines, including our Enterprise
Headsets, which negatively impacted our sales during the quarter;
and continued uncertainty and potential impact on future quarters
if these sourcing constraints continue and/or price volatility
occurs, which could continue to negatively affect our
profitability and/or market share, (b) our expectations that the
virus has caused and will continue to cause, an increase in
customer and partner demand, including increased demand in
collaboration endpoints due to a global, work from home workforce,
(c) expectations related to our voice product lines, as well as our
services attachment rate for such products, which have been, and
may continue to be, negatively impacted as companies have delayed
returning their workforces to offices in many countries due to
uncertainties related to the continued impact of COVID-19; (d)
expectations related to our ability to fulfill the backlog
generated by supply constraints during the quarter, to timely
supply the number of products to fulfill current and future
customer demand, including expectations that our manufacturing
facility in Tijuana, Mexico will continue production at the
capacity necessary to meet such demand, (e) the impact of the virus
on our distribution partners, resellers, end-user customers and our
production facilities, including our ability to obtain alternative
sources of supply if our production facility or other suppliers are
impacted by future shut downs, (f) the impact if global or regional
economic conditions deteriorate further, on our customers and/or
partners, including increased demand for pricing accommodations,
delayed payments, delayed deployment plans, insolvency or other
issues which may increase credit losses, and (g) risks related to
restrictions or delays in global return to worksites as a result of
COVID-19, which continues to impact our employees worldwide and our
customers, which has negatively impacted our voice product lines
for the quarter, and restricted customer engagement; and (h) the
complexity of the forecast analysis and the design and operation of
internal controls; and (ii) our belief that we can manufacture or
supply products in a timely manner to satisfy perishable demand;
(iii) expectations related to our customers' purchasing decisions
and our ability to match product production to demand, particularly
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; (iv) risks associated with significant and abrupt changes
in product demand which increases the complexity of management's
evaluation of potential excess or obsolete inventory; (v) risks
associated with the bankruptcy or financial weakness of
distributors or key customers, or the bankruptcy of or reduction in
capacity of our key suppliers; (vi) risks associated with the
potential interruption in the supply of sole-sourced critical
components, our ability to move to a dual-source model, and the
continuity of component supply at costs consistent with our plans,
which has negatively impacted in the quarter and may continue to
impact our ability to timely supply product to meet our customer
demand; (vii) expectations related to our services segment
revenues, particularly as we introduce new generation, less
complex, product solutions, or as companies shift from on premises
to work from home options for their workforce, which may result in
decreased demand for our professional, installation and/or
managed service offerings; (viii) expectations that our current
cash on hand, additional cash generated from operations, together
with sources of cash through our credit facility, either alone or
in combination with our election to suspend our dividend payments,
will meet our liquidity needs during and following the unknown
duration and impact of the COVID-19 pandemic; (ix) expectations
relating to our ability to generate sufficient cash flow from
operations to meet our debt covenants and timely repay all
principal and interest amounts drawn under our credit facility as
they become due; (x) 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; (xi) our efforts to
execute to drive sales and sustainable profitable revenue growth;
(xii) our expectations for new products launches, the timing of
their releases and their expected impact on future growth and on
our existing products; (xiii) our belief that our new Partner
Program will drive growth and profitability for both us and our
partners through the sale of our product, services and solutions;
(xiv) risks associated with forecasting sales and procurement
demands, which are inherently difficult, particularly with
continuing uncertainty in regional and global economic conditions;
(xv) uncertainties attributable to currency fluctuations, including
fluctuations in foreign exchange rates and/or new or greater
tariffs on our products; (xvi) our expectations regarding our
ability to control costs, streamline operations and successfully
implement our various cost-reduction activities and realize
anticipated cost savings under such cost-reduction initiatives;
(xvii) expectations relating to our quarterly and annual earnings
guidance, particularly as economic uncertainty, including, without
limitation, uncertainty related to the continued impact of
COVID-19, the macro-economic and political climate and other
external factors, puts further pressure on management judgments
used to develop forward looking financial guidance and other
prospective financial information; (xviii) expectations related to
GAAP and non-GAAP financial results for the first quarter and full
Fiscal Year 2021, including net revenues, adjusted EBITDA, tax
rates, intangibles amortization, diluted weighted average shares
outstanding and diluted EPS; (xix) 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, software and services offerings; (xx) our
beliefs regarding the UC&C market, market dynamics and
opportunities, and customer and partner behavior as well as our
position in the market, including risks associated with the
potential failure of our UC&C solutions to be adopted with the
breadth and speed we anticipate; (xxi) our belief that the
increased adoption of certain technologies and our open
architecture approach has and will continue to increase demand for
our solutions; (xxii) expectations related to the micro and
macro-economic conditions in our domestic and international markets
and their impact on our future business; (xxiii) our forecast and
estimates with respect to tax matters, including expectations with
respect to utilizing our deferred tax assets; (xxiv) our
expectations related to building strategic alliances and key
partnerships with providers of collaboration tools and platforms to
drive revenue growth and market share; and (xxv) our expectations
regarding pending and potential future litigation, in addition to
other matters discussed in this press release that are not purely
historical data. Such forward-looking statements are based on
current expectations and assumptions and are subject to risks and
uncertainties that may cause actual results to differ materially
from the forward-looking statements.
We do not assume any obligation to update or revise any such
forward-looking statements, whether as the result of new
developments or otherwise.
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 June
8, 2020 and other filings with the Securities and Exchange
Commission, as well as recent press releases.
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
|
|
|
|
June
27,
|
|
June
29,
|
|
|
|
2020
|
|
2019
|
|
Net
revenues:
|
|
|
|
|
|
Net product
revenues
|
|
$
|
291,458
|
|
|
$
|
382,745
|
|
|
Net services
revenues
|
|
64,262
|
|
|
65,022
|
|
|
Total net
revenues
|
|
355,720
|
|
|
447,767
|
|
|
Cost of
revenues:
|
|
|
|
|
|
Cost of product
revenues
|
|
176,615
|
|
|
208,616
|
|
|
Cost of service
revenues
|
|
22,773
|
|
|
26,505
|
|
|
Total cost of
revenues
|
|
199,388
|
|
|
235,121
|
|
|
Gross
profit
|
|
156,332
|
|
|
212,646
|
|
|
Gross profit
%
|
|
43.9
|
%
|
|
47.5
|
%
|
|
Operating
expenses:
|
|
|
|
|
|
Research,
development, and engineering
|
|
50,029
|
|
|
59,524
|
|
|
Selling, general, and
administrative
|
|
116,644
|
|
|
163,608
|
|
|
Impairment of
goodwill and long-lived assets
|
|
—
|
|
|
—
|
|
|
(Gain) loss, net from
litigation settlements
|
|
17,561
|
|
|
(1,162)
|
|
|
Restructuring and
other related charges
|
|
29,330
|
|
|
19,525
|
|
|
Total operating
expenses
|
|
213,564
|
|
|
241,495
|
|
|
Operating
loss
|
|
(57,232)
|
|
|
(28,849)
|
|
|
Operating loss
%
|
|
(16.1)
|
%
|
|
(6.4)
|
%
|
|
|
|
|
|
|
|
Interest
expense
|
|
(21,184)
|
|
|
(23,932)
|
|
|
Other non-operating
income, net
|
|
224
|
|
|
333
|
|
|
Income before income
taxes
|
|
(78,192)
|
|
|
(52,448)
|
|
|
Income tax
benefit
|
|
(3,177)
|
|
|
(7,577)
|
|
|
Net loss
|
|
$
|
(75,015)
|
|
|
$
|
(44,871)
|
|
|
|
|
|
|
|
|
% of net
revenues
|
|
(21.1)
|
%
|
|
(10.0)
|
%
|
|
|
|
|
|
|
|
Loss per common
share:
|
|
|
|
|
|
Basic
|
|
$
|
(1.85)
|
|
|
$
|
(1.14)
|
|
|
Diluted
|
|
$
|
(1.85)
|
|
|
$
|
(1.14)
|
|
|
|
|
|
|
|
|
Shares used in
computing earnings per common share:
|
|
|
|
|
|
Basic
|
|
40,460
|
|
|
39,239
|
|
|
Diluted
|
|
40,460
|
|
|
39,239
|
|
|
|
|
|
|
|
|
Effective tax
rate
|
|
4.1
|
%
|
|
14.4
|
%
|
|
PLANTRONICS,
INC.
|
SUMMARY CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
|
($ in
thousands)
|
|
UNAUDITED
CONSOLIDATED BALANCE SHEETS
|
|
|
June
27,
|
|
March
28,
|
|
|
|
2020
|
|
2020
|
|
ASSETS
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
249,766
|
|
|
$
|
213,879
|
|
|
Short-term
investments
|
|
13,166
|
|
|
11,841
|
|
|
Total cash, cash
equivalents, and short-term investments
|
|
262,932
|
|
|
225,720
|
|
|
Accounts receivable,
net
|
|
208,688
|
|
|
246,835
|
|
|
Inventory,
net
|
|
177,633
|
|
|
164,527
|
|
|
Other current
assets
|
|
46,145
|
|
|
47,946
|
|
|
Total current
assets
|
|
695,398
|
|
|
685,028
|
|
|
Property, plant, and
equipment, net
|
|
159,539
|
|
|
165,858
|
|
|
Purchased
intangibles, net
|
|
434,481
|
|
|
466,915
|
|
|
Goodwill
|
|
796,216
|
|
|
796,216
|
|
|
Deferred tax and
other assets
|
|
143,248
|
|
|
143,157
|
|
|
Total
assets
|
|
$
|
2,228,882
|
|
|
$
|
2,257,174
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
Accounts
payable
|
|
$
|
115,166
|
|
|
$
|
102,159
|
|
|
Accrued
liabilities
|
|
396,745
|
|
|
373,666
|
|
|
Total current
liabilities
|
|
511,911
|
|
|
475,825
|
|
|
Long-term debt, net
of issuance costs
|
|
1,623,034
|
|
|
1,621,694
|
|
|
Long-term income
taxes payable
|
|
98,949
|
|
|
98,319
|
|
|
Other long-term
liabilities
|
|
144,699
|
|
|
144,152
|
|
|
Total
liabilities
|
|
2,378,593
|
|
|
2,339,990
|
|
|
Stockholders'
equity
|
|
(149,711)
|
|
|
(82,816)
|
|
|
Total liabilities and
stockholders' equity
|
|
$
|
2,228,882
|
|
|
$
|
2,257,174
|
|
|
|
|
|
|
|
|
PLANTRONICS,
INC.
|
|
SUMMARY CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
|
|
($ in thousands,
except per share data)
|
|
|
|
UNAUDITED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
June
27,
|
|
June
29,
|
|
|
|
2020
|
|
2019
|
|
Cash flows from
operating activities
|
|
|
|
|
|
Net Loss
|
|
$
|
(75,015)
|
|
|
$
|
(44,871)
|
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
|
Depreciation and
amortization
|
|
43,400
|
|
|
57,698
|
|
|
Amortization of debt
issuance cost
|
|
1,340
|
|
|
1,361
|
|
|
Stock-based
compensation
|
|
9,355
|
|
|
12,904
|
|
|
Impairment of
goodwill and long-lived assets
|
|
—
|
|
|
—
|
|
|
Deferred income
taxes
|
|
(7,169)
|
|
|
(29,410)
|
|
|
Provision for excess
and obsolete inventories
|
|
6,082
|
|
|
2,769
|
|
|
Restructuring
charges
|
|
29,330
|
|
|
19,525
|
|
|
Cash payments for
restructuring charges
|
|
(13,085)
|
|
|
(17,658)
|
|
|
Other operating
activities
|
|
(1,851)
|
|
|
1,965
|
|
|
Changes in assets and
liabilities:
|
|
|
|
|
|
Accounts receivable,
net
|
|
37,914
|
|
|
21,445
|
|
|
Inventory,
net
|
|
(16,008)
|
|
|
(42,309)
|
|
|
Current and other
assets
|
|
3,483
|
|
|
15,498
|
|
|
Accounts
payable
|
|
12,321
|
|
|
36,392
|
|
|
Accrued
liabilities
|
|
11,236
|
|
|
(44,793)
|
|
|
Income
taxes
|
|
389
|
|
|
17,833
|
|
|
Cash provided by
operating activities
|
|
$
|
41,722
|
|
|
$
|
8,349
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities
|
|
|
|
|
|
Proceeds from sale of
investments
|
|
—
|
|
|
170
|
|
|
Purchase of
investments
|
|
(108)
|
|
|
(651)
|
|
|
Capital
expenditures
|
|
(5,437)
|
|
|
(4,507)
|
|
|
Proceeds from sale of
property, plant, and equipment and assets held for sale
|
|
1,900
|
|
|
—
|
|
|
Cash used for
investing activities
|
|
$
|
(3,645)
|
|
|
$
|
(4,988)
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities
|
|
|
|
|
|
Employees' tax
withheld and paid for restricted stock and restricted stock
units
|
|
(2,739)
|
|
|
(8,621)
|
|
|
Proceeds from
issuances under stock-based compensation plans
|
|
5
|
|
|
589
|
|
|
Proceeds from
revolving line of credit
|
|
50,000
|
|
|
—
|
|
|
Repayments of
revolving line of credit
|
|
(50,000)
|
|
|
—
|
|
|
Payment of cash
dividends
|
|
—
|
|
|
(5,940)
|
|
|
Cash used for
financing activities
|
|
$
|
(2,734)
|
|
|
$
|
(13,972)
|
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
|
544
|
|
|
6
|
|
|
Net increase
(decrease) in cash and cash equivalents
|
|
35,887
|
|
|
(10,605)
|
|
|
Cash and cash
equivalents at beginning of period
|
|
213,879
|
|
|
202,509
|
|
|
Cash and cash
equivalents at end of period
|
|
$
|
249,766
|
|
|
$
|
191,904
|
|
|
|
|
|
|
|
|
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
|
|
|
June
27,
|
|
June
29,
|
|
|
2020
|
|
2019
|
|
|
|
|
|
|
GAAP Net
revenues
|
$
|
355,720
|
|
|
$
|
447,767
|
|
|
Deferred revenue
purchase accounting1
|
5,082
|
|
|
12,159
|
|
|
Non-GAAP Net
revenues
|
$
|
360,802
|
|
|
$
|
459,926
|
|
|
|
|
|
|
|
GAAP Gross
profit
|
$
|
156,332
|
|
|
$
|
212,646
|
|
|
Purchase accounting
amortization2
|
18,238
|
|
|
30,000
|
|
|
Deferred revenue
purchase accounting1
|
5,082
|
|
|
12,159
|
|
|
Integration and
Rebranding costs
|
—
|
|
|
958
|
|
|
Stock-based
compensation
|
833
|
|
|
978
|
|
|
Non-GAAP Gross
profit
|
$
|
180,485
|
|
|
$
|
256,741
|
|
|
Non-GAAP Gross
profit %
|
50.0
|
%
|
|
55.8
|
%
|
|
|
|
|
|
|
GAAP Research,
development, and engineering
|
$
|
50,029
|
|
|
$
|
59,524
|
|
|
Stock-based
compensation
|
(3,231)
|
|
|
(3,719)
|
|
|
Integration and
Rebranding costs
|
(194)
|
|
|
(1,341)
|
|
|
Non-GAAP Research,
development, and engineering
|
$
|
46,604
|
|
|
$
|
54,464
|
|
|
|
|
|
|
|
GAAP Selling,
general, and administrative
|
$
|
116,644
|
|
|
$
|
163,608
|
|
|
Integration and
Rebranding costs
|
6
|
|
|
(23,591)
|
|
|
Purchase accounting
amortization2
|
(14,195)
|
|
|
(15,278)
|
|
|
Stock-based
compensation
|
(5,296)
|
|
|
(8,207)
|
|
|
Non-GAAP Selling,
general, and administrative
|
$
|
97,159
|
|
|
$
|
116,532
|
|
|
|
|
|
|
|
1
|
|
Deferred revenue
purchase accounting: Represents the impact of fair value
purchase accounting adjustments related to deferred revenue
recorded in connection with the acquisition of Polycom on July 2,
2018. The Company's deferred revenue primarily relates to Service
revenue associated with non-cancelable maintenance support on
hardware devices which are typically billed in advance and
recognized ratably over the contract term as those services are
delivered. This adjustment represents the amount of additional
revenue that would have been recognized during the period absent
the write-down to fair value required under purchase accounting
guidelines.
|
2
|
|
Purchase
accounting amortization: Represents the amortization of
purchased intangible assets recorded in connection with the
acquisition of Polycom on July 2, 2018.
|
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
|
|
|
June
27,
|
|
June
29,
|
|
|
2020
|
|
2019
|
|
|
|
|
|
|
GAAP Operating
expenses
|
$
|
213,564
|
|
|
$
|
241,495
|
|
|
Integration and
Rebranding costs
|
(188)
|
|
|
(24,932)
|
|
|
Purchase accounting
amortization2
|
(14,195)
|
|
|
(15,278)
|
|
|
Stock-based
compensation
|
(8,527)
|
|
|
(11,926)
|
|
|
Restructuring and
other related charges
|
(29,330)
|
|
|
(19,525)
|
|
|
Gain (loss), net from
litigation settlements
|
(17,561)
|
|
|
1,162
|
|
|
Non-GAAP Operating
expenses
|
$
|
143,763
|
|
|
$
|
170,996
|
|
|
|
|
|
|
|
GAAP Operating
loss
|
$
|
(57,232)
|
|
|
$
|
(28,849)
|
|
|
Purchase accounting
amortization2
|
32,433
|
|
|
45,278
|
|
|
Deferred revenue
purchase accounting1
|
5,082
|
|
|
12,159
|
|
|
Integration and
Rebranding costs
|
188
|
|
|
25,890
|
|
|
Stock-based
compensation
|
9,360
|
|
|
12,904
|
|
|
Restructuring and
other related charges
|
29,330
|
|
|
19,525
|
|
|
(Gain) loss, net from
litigation settlements
|
17,561
|
|
|
(1,162)
|
|
|
Non-GAAP Operating
income
|
$
|
36,722
|
|
|
$
|
85,745
|
|
|
|
|
|
|
|
1
|
Deferred revenue
purchase accounting: Represents the impact of fair value
purchase accounting adjustments related to deferred revenue
recorded in connection with the acquisition of Polycom on July 2,
2018. The Company's deferred revenue primarily relates to Service
revenue associated with non-cancelable maintenance support on
hardware devices which are typically billed in advance and
recognized ratably over the contract term as those services are
delivered. This adjustment represents the amount of additional
revenue that would have been recognized during the period absent
the write-down to fair value required under purchase accounting
guidelines.
|
2
|
Purchase
accounting amortization: Represents the amortization of
purchased intangible assets recorded in connection with the
acquisition of Polycom on July 2, 2018.
|
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
|
|
|
June
27,
|
|
June
29,
|
|
|
2020
|
|
2019
|
|
GAAP Net
loss
|
$
|
(75,015)
|
|
|
$
|
(44,871)
|
|
|
Purchase accounting
amortization2
|
32,433
|
|
|
45,278
|
|
|
Deferred revenue
purchase accounting1
|
5,082
|
|
|
12,159
|
|
|
Integration and
Rebranding costs
|
196
|
|
|
25,890
|
|
|
Stock-based
compensation
|
9,360
|
|
|
12,904
|
|
|
Restructuring and
other related charges
|
29,330
|
|
|
19,525
|
|
|
(Gain) loss, net from
litigation settlements
|
17,561
|
|
|
(1,162)
|
|
|
Income tax effect of
above items
|
(13,347)
|
|
|
(15,483)
|
|
|
Income tax effect of
unusual tax items
|
7,728
|
|
3
|
(2,017)
|
|
|
Non-GAAP Net
income
|
$
|
13,328
|
|
|
$
|
52,223
|
|
|
|
|
|
|
|
GAAP Diluted earnings
per common share
|
$
|
(1.85)
|
|
|
$
|
(1.14)
|
|
|
Purchase accounting
amortization2
|
0.80
|
|
|
1.15
|
|
|
Deferred revenue
purchase accounting1
|
0.13
|
|
|
0.31
|
|
|
Stock-based
compensation
|
0.23
|
|
|
0.33
|
|
|
Integration and
Rebranding costs
|
—
|
|
|
0.66
|
|
|
Restructuring and
other related charges
|
0.72
|
|
|
0.49
|
|
|
(Gain) loss, net from
litigation settlements
|
0.43
|
|
|
(0.03)
|
|
|
Income tax
effect
|
(0.13)
|
|
|
(0.46)
|
|
|
Effect of
anti-dilutive securities
|
—
|
|
|
0.01
|
|
|
Non-GAAP Diluted
earnings per common share
|
$
|
0.33
|
|
|
$
|
1.32
|
|
|
|
|
|
|
|
Shares used in
diluted earnings per common share calculation:
|
|
|
|
|
GAAP
|
40,460
|
|
|
39,239
|
|
|
Non-GAAP
|
40,620
|
|
|
39,523
|
|
|
1
|
Deferred revenue
purchase accounting: Represents the impact of fair value
purchase accounting adjustments related to deferred revenue
recorded in connection with the acquisition of Polycom on July 2,
2018. The Company's deferred revenue primarily relates to Service
revenue associated with non-cancelable maintenance support on
hardware devices which are typically billed in advance and
recognized ratably over the contract term as those services are
delivered. This adjustment represents the amount of additional
revenue that would have been recognized during the period absent
the write-down to fair value required under purchase accounting
guidelines.
|
2
|
Purchase
accounting amortization: Represents the amortization of
purchased intangible assets recorded in connection with the
acquisition of Polycom on July 2, 2018.
|
3
|
Excluded amounts
represent amortization of intellectual property, impact of
valuation allowance, and the release of tax reserves.
|
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
|
|
|
|
June
29,
|
|
September
28,
|
|
December
28,
|
|
March
28,
|
|
June
27,
|
|
June
27,
|
|
|
|
2019
|
|
2019
|
|
2019
|
|
2020
|
|
2020
|
|
2020
|
|
GAAP Net
loss
|
|
$
|
(44,871)
|
|
|
$
|
(25,910)
|
|
|
$
|
(78,483)
|
|
|
$
|
(662,820)
|
|
|
$
|
(75,015)
|
|
|
$
|
(842,228)
|
|
|
Tax
provision
|
|
(7,576)
|
|
|
(4,122)
|
|
|
(19,708)
|
|
|
(37,995)
|
|
|
(3,177)
|
|
|
(65,002)
|
|
|
Interest
Expense
|
|
23,932
|
|
|
23,797
|
|
|
22,533
|
|
|
22,378
|
|
|
21,184
|
|
|
89,892
|
|
|
Other Income and
Expense
|
|
(333)
|
|
|
625
|
|
|
(967)
|
|
|
562
|
|
|
(224)
|
|
|
(4)
|
|
|
Deferred revenue
purchase accounting1
|
|
12,159
|
|
|
8,524
|
|
|
7,131
|
|
|
6,138
|
|
|
5,082
|
|
|
26,875
|
|
|
Consumer
optimization3
|
|
—
|
|
|
—
|
|
|
10,415
|
|
|
—
|
|
|
—
|
|
|
10,415
|
|
|
Integration and
Rebranding costs
|
|
25,890
|
|
|
11,329
|
|
|
8,677
|
|
|
2,321
|
|
|
197
|
|
|
22,524
|
|
|
Stock-based
compensation
|
|
12,904
|
|
|
14,693
|
|
|
13,902
|
|
|
15,596
|
|
|
9,360
|
|
|
53,551
|
|
|
Restructuring and
other related charges
|
|
19,525
|
|
|
5,847
|
|
|
21,724
|
|
|
7,080
|
|
|
29,330
|
|
|
63,981
|
|
|
Impairment
charges
|
|
—
|
|
|
—
|
|
|
—
|
|
|
648,231
|
|
|
—
|
|
|
648,231
|
|
|
(Gain) loss, net from
litigation settlements
|
|
(1,162)
|
|
|
—
|
|
|
—
|
|
|
419
|
|
|
17,561
|
|
|
17,980
|
|
|
Other
adjustments2
|
|
—
|
|
|
542
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
542
|
|
|
Depreciation and
amortization
|
|
57,698
|
|
|
57,376
|
|
|
57,556
|
|
|
57,632
|
|
|
43,400
|
|
|
215,964
|
|
|
Adjusted
EBITDA
|
|
$
|
98,166
|
|
|
$
|
92,701
|
|
|
$
|
42,780
|
|
|
$
|
59,542
|
|
|
$
|
47,698
|
|
|
$
|
242,721
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1
|
Deferred revenue
purchase accounting: Represents the impact of fair value
purchase accounting adjustments related to deferred revenue
recorded in connection with the acquisition of Polycom on July 2,
2018. The Company's deferred revenue primarily relates to Service
revenue associated with non-cancelable maintenance support on
hardware devices which are typically billed in advance and
recognized ratably over the contract term as those services are
delivered. This adjustment represents the amount of additional
revenue that would have been recognized during the period absent
the write-down to fair value required under purchase accounting
guidelines.
|
2
|
Other
adjustments: Excluded amounts represent immaterial executive
transition costs.
|
3
|
Consumer
Optimization: Excluded amounts represent inventory related
reserves associated with optimizing the consumer product
portfolio.
|
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SOURCE Plantronics, Inc.