Logitech 2007 Annual Report Download - page 84

product throughout Asia through the use of externally administered warehouses in Taiwan, China and Singapore.
Logitech’s high-volume manufacturing is located in Suzhou, China, in two Company-owned buildings totaling
600,000 and 253,700 square feet. We also leased a 91,500 square foot building for molding operations, on a lease
which terminates in April 2007. We are negotiating a lease on a new facility of approximately 53,750 square feet
for the molding operations. We have also signed a lease on a new facility in Suzhou, comprising approximately
143,000 square feet, which is expected to be available for occupation in June 2007. The lease expires in May
2012 and the facility will be used for production and manufacturing.
In addition to the distribution centers in Asia, Logitech has major distribution centers in Southaven,
Mississippi and in the Netherlands. The 550,000-square foot facility in Southaven is contracted with a third-party
logistics company that leases and manages the distribution center for Logitech. The arrangement with the
management company is through December 2007 with an option to renew annually. We have two distribution
centers in the Netherlands; the main European distribution location in Venray, Netherlands and a smaller facility
in Venlo, Netherlands. Both facilities are contracted with warehouse management companies that lease and
manage the distribution centers for Logitech. The Venray warehouse is approximately 183,400 square feet and
the arrangement with the management company was originally through December 2006 and has been extended to
December 2009. The Venlo facility is approximately 80,000 square feet, and the arrangement with the
management company is through December 2007. Additionally, we have a 45,500-square foot distribution center
in Zalaegerzeg, Hungary, which is also contracted with a warehouse management company. Logitech also
contracts with various distribution services throughout the world for additional warehouses in which we store
inventory.
We also have leased sales offices in more than 55 locations in 37 countries, with various expiration dates
from 2007 to 2015.
We believe that Logitech’s manufacturing and distribution facilities are adequate for our ongoing needs and
we continue to evaluate the need for additional facilities to meet anticipated future requirements.
ITEM 4A. UNRESOLVED STAFF COMMENTS
Not applicable.
ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS
The following Operating and Financial Review and Prospects contains forward-looking statements that
involve risks and uncertainties. The Company’s actual results could differ materially from those anticipated in
these statements as a result of certain factors, including those set forth above in Item 3D “Risk Factors,” and
below in Item 11 “Quantitative and Qualitative Disclosure about Market Risk.”
Overview
Logitech is a world leader in personal peripherals for personal computers and other digital platforms,
developing and marketing innovative products in PC navigation, Internet communications, digital music, home-
entertainment control, interactive gaming and wireless devices. Our products include mice, keyboards, trackballs,
3D control devices, webcams, multimedia speakers, wireless and Internet music solutions for the home, headsets,
headphones, gaming controllers, gaming accessories and advanced remote controls for home entertainment
systems.
We sell our products to a network of distributors and resellers (“retail”) and to original equipment
manufacturers (“OEMs”). Our worldwide retail network includes wholesale distributors, consumer electronics
retailers, mass merchandisers, specialty electronics stores, computer and telecommunications stores, value-added
resellers and online merchants.
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