Logitech 2007 Annual Report Download - page 100

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During fiscal year 2007, we used $138.1 million for share repurchases of approximately 5.6 million shares
pursuant to the Company’s buyback programs announced in June 2005 and May 2006. The buyback program
announced in May 2006 authorizes the purchase of up to $250.0 million in Logitech shares. The buyback
program announced in June 2005 authorized the purchase of up to CHF 300.0 million (approximately
$235.0 million based on exchange rates at the date of announcement) in Logitech shares. Cash flow from
financing activities included $44.7 million in proceeds from the sale of 5.2 million shares under the Company’s
employee option and share purchase plans, and $13.1 million related to tax benefits recognized on the exercise of
share-based payment awards. Short-term debt was reduced by $2.2 million.
Cash used in financing activities during fiscal year 2006 included share repurchases of 12.3 million shares,
totaling $241.4 million pursuant to the Company’s buyback programs announced in April 2004 and June 2005.
Proceeds also included $49.2 million from the sale of 7.1 million shares under the Company’s employee option
and share purchase plans and $5.2 million from short-term borrowing in Japanese yen, to benefit from low
interest rates and to offset exposures in yen-denominated assets. During fiscal year 2006, all of the Company’s
convertible bonds were converted into a total of 10,897,386 Logitech registered shares through delivery of
treasury shares which had no cash impact on financing activities.
Cash used in financing activities during fiscal year 2005 included share repurchases of 11.1 million shares,
totaling $134.5 million pursuant to the Company’s buyback program announced in April 2004. Debt repayments
totaling $4.5 million primarily related to the Swiss mortgage loan that matured in April 2004. Proceeds totaling
$46.0 million were realized from the sales of shares pursuant to the Company’s employee option and share
purchase plans.
Cash Outlook
Our working capital requirements and capital expenditures may increase to support future expansion of
Logitech operations. Future acquisitions or expansion of our operations may be significant and may require the
use of cash.
In May 2006, we announced the approval by our board of directors of a new share buyback program
authorizing the repurchase of up to $250 million of our shares. The program expires at the Company’s 2009
Annual General Meeting at the latest. Under this program, we repurchased 2.7 million shares for $76.6 million
during the year ended March 31, 2007. The approved amount remaining under this program at March 31, 2007 is
$173.4 million. We plan to continue repurchasing shares in fiscal year 2007 under this program.
In June 2005, we announced the approval by our board of directors of a buyback program of up to CHF
300.0 million (approximately $235.0 million based on exchange rates at the date of announcement). Under this
program, which was completed in the quarter ended December 31, 2006, we repurchased 2.9 million shares for
$61.5 million in fiscal year 2007, and a total of 11.3 million shares for $236.1 million.
Also in fiscal year 2008, the Company plans to continue investing in leasehold improvements, tooling and
other manufacturing and operating infrastructure.
In October 2006, we acquired Slim Devices, Inc. (“Slim Devices”), a privately held company specializing in
network-based audio systems for digital music. Under the terms of the purchase agreement, we acquired all of
the outstanding shares of Slim Devices for $20.6 million in cash, plus a possible performance-based payment,
payable in the first calendar quarter of 2010. The performance-based payment is based on net revenues from the
sale of products and services in calendar year 2009 derived from Slim Devices’ technology. No payment is due if
the applicable net revenues total $40 million or less. The maximum performance-based payment is $89.5 million.
The total performance-based payment amount, if any, will be recorded in goodwill and will not be known until
the end of calendar year 2009.
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