Logitech 2008 Annual Report Download

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the
digital
life
Annual Report
08
Our Products Make It Personal

Table of contents

  • Page 1
    the digital life Our Products Make It Personal Annual Report 08

  • Page 2
    ... for Logitech. It was our tenth consecutive year of double-digit sales growth. Our operating profit, net profit, earnings per share and gross margin all reached new highs. We also ended the year with $486 million in cash, which positions us to continue to invest in our business and to return value...

  • Page 3
    One of the key drivers of our consistent growth has been our ability to deliver innovative and intuitive products that make the Digital Life more personal and more satisfying. We see many exciting opportunities for continued growth in the trends that are changing how we live, work and play. In the ...

  • Page 4
    net sales in millions of U.S. dollars +15% 448 592 736 944 1,100 1,268 1,483 1,797 2,067 99 00 01 02 03 04 05 06 07 08 operating profit in millions of U.S. dollars +24% 16 41 55 97 124 146 172 199 231 99 00 01 02 03 04 05 06 07 08 2 Logitech Annual...

  • Page 5
    ... in millions of U.S. dollars +29% 166 214 17 33 12 113 145 152 304 99 00 01 02 03 04 05 06 07 08 share performance LOGI Swiss Performance Index NASDAQ-100 Index 340 311 243 Initial investment of 100 186 140 121 91 81 33 88 34 39 40 41 142...

  • Page 6
    ... product categories. Our product innovations included the Wave keyboard, designed for extreme comfort in typing; the tiny plug-and-forget Nano-receiver for cordless mice; the elegantly designed MX Air Mouse that works on the desk or in the air; a line of stands that raise notebooks to a new...

  • Page 7
    ... passion among our employees for innovation, our customers' experience and the opportunities ahead, position your company for future growth. We remain pleased and encouraged by the enthusiasm of our management team, our employees, our distribution partners and our other business partners as we move...

  • Page 8
    ... catégories de produit. Parmi ces produits innovants, nous rappelons le clavier Wave™, conçu pour un confort d'utilisation optimal ; le minuscule récepteur Nano pour souris sans fil et l'élégante souris MX™ Air qui fonctionne sur bureau ou en l'air. Signalons également une gamme de socles...

  • Page 9
    ... einzigen Gruppe zusammengefasst, geleitet von Junien Labrousse, der seit zehn Jahren bei Logitech ist, und es wurde eine „Customer Experience Organization" gebildet, geleitet von unserem langjährigen Mitarbeiter David Henry, der ausserdem zum Chief Marketing Officer ernannt wurde. Alle diese...

  • Page 10
    ... for your trust and support along this journey. I also want to deeply thank all our employees, customers and partners around the world for your contributions to our success. This is just the beginning! Yours sincerely, Daniel Borel Co-founder and Member of the Board 4 Logitech Annual Report 08

  • Page 11
    ...seule et même équipe sans jamais baisser les bras. ...Logitech. Ensemble, nous avons connu des années de réussite et partagé un rêve et une vision d'avenir. Le 1er janvier 2008, j'ai été très heureux de passer le témoin à Guerrino De Luca en tant que Président du Conseil d'administration...

  • Page 12
    ... products with their notebooks. Our offerings include wireless mice, webcams, notebook stands and more. With each of these peripherals, Logitech has seized the opportunity to be a leader in innovation, introducing new functionality to provide solutions to consumer pain points such as navigation...

  • Page 13
    Logitech Annual Report 08 11

  • Page 14
    12 Logitech Annual Report 08

  • Page 15
    ... use of wireless connectivity at home and at work. Wireless products give users the freedom to navigate, move, communicate, listen and be productive in a variety of situations and without sacrificing comfort or functionality. Wave Cordless Desktop Catch the wave with the Logitech Wave Keyboard-the...

  • Page 16
    ... and RightSound and RightLight 2 Technologies, Logitech is advancing the standard for both webcam image quality and online communications. PC Headset 960 USB Digital, stereo, USB, over-the-head headset with in-line volume control Plug-and-play Monitoring of the Home and Small Business One of the...

  • Page 17
    Logitech Annual Report 08 15

  • Page 18
    16 Logitech Annual Report 08

  • Page 19
    ...our easy-to-use, wireless streaming solution. Logitech's unique Internet service, the SqueezeNetwork, allows users with broadband Internet access to listen to music-even when their computers are off. The ongoing penetration of digital music, our strong product portfolio covering current and emerging...

  • Page 20
    ...opportunities is in the digital home. The need to use multiple remotes to manage separate home entertainment devices is a very real pain point for millions of consumers. We offer an elegant solution to this problem with the one-touch simplicity of our Harmony remotes. Remotes was our fastest-growing...

  • Page 21
    Fly me to the moon... CU 2NITE! Logitech Annual Report 08 19

  • Page 22
    ...we fail to innovate successfully in our current and emerging product categories and identify new feature or product opportunities; our ability to introduce successful products in a timely manner and market acceptance of those products; our product introductions and marketing activities not resulting...

  • Page 23
    ... OF CONTENTS Page Management's Discussion and Analysis of Financial Condition and Results of Operations ...Additional Financial Disclosures ...Report on Corporate Governance ...Consolidated Financial Statements ...Logitech International S.A., Apples - Swiss Statutory Financial Statements... 2 23 CG...

  • Page 24
    ... innovative products in PC navigation, Internet communications, digital music, homeentertainment control, video security, interactive gaming and wireless devices. For the PC, our products include mice, trackballs, keyboards, gaming controllers, multimedia speakers, headsets, webcams, and 3D control...

  • Page 25
    ... In our pointing devices, keyboards and desktops product lines, we plan to continue our expansion into the notebook arena. We also see significant opportunities for our mice and keyboards in the business market. In the audio arena, we expect that our strong presence in the speaker category, combined...

  • Page 26
    ... programs include volume and consumer rebates. We offer volume rebates to our distribution and retail customers related to purchase volumes or sales of specific products by distributors to specified retailers. Reserves for volume rebates are recognized as a reduction of the sale price at the time...

  • Page 27
    ... for product returns, cooperative marketing arrangements, customer incentive programs and price protection. Future market conditions and product transitions may require the Company to take action to increase such programs. In addition, when the variables used to estimate these costs change, or...

  • Page 28
    ...are expected to vest. The dividend yield assumption is based on the Company's history and future expectations of dividend payouts. The assumptions used in calculating the fair value of share-based compensation expense and related tax effects represent management's best estimates, but these estimates...

  • Page 29
    ... results; significant changes in the manner of use of the assets or the strategy for the Company's overall business; significant negative industry or economic trends; significant decline in the Company's stock price for a sustained period; and market capitalization relative to net book value. 7

  • Page 30
    ...We calculate the Company's fair value based on the present value of projected cash flows using a discount rate determined by management to be commensurate to the risk inherent in the Company's current business model. To date, we have not recognized any impairment of goodwill. Logitech bases its fair...

  • Page 31
    ...Logitech's Pointing Devices product family includes the Company's mice, trackballs and other pointing devices. Keyboards and desktops include cordless and corded keyboards and desktops. Audio includes speakers and headset products for the PC, the home, and mobile entertainment platforms and wireless...

  • Page 32
    ... fiscal year. Growth in the Americas region was driven by solid contributions from sales of pointing devices, remotes, keyboards and desktops. In the Asia Pacific region, all product lines except video achieved doubledigit retail sales growth. Retail sales in the EMEA region increased 8% and units...

  • Page 33
    ... advertising and product promotion costs such as our advertising campaign for our remotes product line launched during the fourth quarter of fiscal year 2008. The impact of exchange rate changes on translation of foreign currency marketing and selling expenses to the Company's U.S. dollar financial...

  • Page 34
    ... the year due to expanded facilities. The impact of exchange rate changes on translation of foreign currency general and administrative expenses to the Company's U.S. dollar financial statements, particularly from the stronger Euro and Swiss franc relative to the U.S. dollar, also contributed to the...

  • Page 35
    ...(in thousands): 2007 2006 Change % Net sales by channel: Retail ...OEM ...Total net sales ...Net sales by product family: Retail - Pointing Devices ...Retail - Keyboards & Desktops ...Retail - Audio ...Retail - Video ...Retail - Gaming ...Retail - Remotes ...OEM ...Total net sales...13 $ 1,844,395...

  • Page 36
    ... Pointing Devices. Sales of the Company's retail cordless products in fiscal year 2007 increased 11% compared with fiscal year 2006. The growth was led by sales of cordless mice, which increased 25% in dollars and 17% in units, based on the success of new launches such as the MX Revolution cordless...

  • Page 37
    ... due to increased advertising and customer marketing programs to stimulate sales and higher personnel costs from headcount growth in support of increased retail business, including our continued expansion in Latin America, Eastern Europe and China. Costs also increased due to product design and...

  • Page 38
    ... costs associated with our implementation of Oracle 11i enterprise resource planning software, and increased occupancy costs related to infrastructure expansion. Personnel costs in fiscal year 2007 also include $7.1 million of share-based compensation expense resulting from the adoption of SFAS 123R...

  • Page 39
    ... to a confidential settlement agreement. The par value sale price was not necessarily indicative of current fair market value at the date of sale for the securities. In addition, the Company sold all of its remaining short-term investments collateralized by corporate debt and received $28.3 million...

  • Page 40
    ... 60 days; however, terms may vary by customer type, by country and by selling season. Extended payment terms are sometimes offered to a limited number of customers during the second and third fiscal quarters. The Company does not modify payment terms on existing receivables, but may offer discounts...

  • Page 41
    ... two new production and manufacturing facilities, including a new surface mount technology factory in China, leasehold improvements for a new office facility in Switzerland, computer hardware and software purchases, and normal expenditures for tooling. The Company's purchases of property, plant and...

  • Page 42
    ... for digital music. The purchase agreement provides for a possible performancebased 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. The...

  • Page 43
    ... of $33.6 million for consulting, marketing arrangements, advertising and other services. Although open purchase commitments are considered enforceable and legally binding, the terms generally allow us the option to reschedule and adjust our requirements based on business needs prior to the delivery...

  • Page 44
    ...The other guarantee is limited to purchases of specified components from the named supplier. Logitech International S.A., the parent holding company, has guaranteed certain contingent liabilities of various subsidiaries related to specific transactions occurring in the normal course of business. The...

  • Page 45
    ...and merchandising, a Worldwide Web site and other efforts. We also acquire knowledge of our users through customer feedback and market research, including focus groups, product registrations, user questionnaires, primary and multiclient surveys and other techniques. In addition, manufacturers of PCs...

  • Page 46
    ... share price information for the Company's shares traded on the SWX Swiss Exchange. The U.S. dollar equivalent is based on the noon buying rate on the trading day of the month in which the high or low closing sales price occurred. The noon buying rate is the rate in New York City for cable transfers...

  • Page 47
    ... certain historical share price information for the Company's shares traded on the Nasdaq Global Select Market. Share prices have been adjusted to reflect a two-for-one split in July 2006. Prior to October 2006 Logitech ADSs traded on Nasdaq, with each ADS representing one share. Price per share on...

  • Page 48
    ... purchases made by Logitech of its equity securities (in thousands, except share and per share amounts): Total Number of Shares Purchased as Part of Publicly Announced Programs Approximate Dollar Value of Shares That May Yet Be Purchased Under the Programs Average Price Paid Per Share in USD in CHF...

  • Page 49
    ... Index. The graph assumes that $100 was invested in our shares, the Nasdaq Composite Index and the S&P 500 Information Technology Index on March 31, 2003, and calculates the return quarterly through March 31, 2008. The stock price performance on the following graph is not necessarily indicative of...

  • Page 50
    ... Market Risk Market risk represents the potential for loss due to adverse changes in the fair value of financial instruments. As a global concern, the Company faces exposure to adverse movements in foreign currency exchange rates and interest rates. These exposures may change over time as business...

  • Page 51
    ... The Company is exposed to foreign currency exchange rate risk as it transacts business in multiple foreign currencies, including exposure related to anticipated sales, anticipated purchases and assets and liabilities denominated in currencies other than the U.S. dollar. Logitech transacts business...

  • Page 52
    From time to time, the Company enters into foreign exchange forward contracts to reduce the shortterm effects of foreign currency fluctuations on certain foreign currency receivables or payables and to provide against exposure to changes in foreign currency exchange rates related to subsidiaries' ...

  • Page 53
    REPORT ON CORPORATE GOVERNANCE 2008

  • Page 54
    ... company with its registered office in Apples, Switzerland, which conducts its business through subsidiaries in North America, Europe and Asia Pacific. Shares of Logitech International S.A. are listed on both the Nasdaq Global Select Market (Ticker: LOGI, CUSIP H50430232), and the SWX Swiss Exchange...

  • Page 55
    ... the business units and marketing and sales organizations through management of distribution centers and of the product supply chain, and the provision of technical support, customer relations and other services. Logitech International S.A. directly or indirectly owns 100% of all the companies in...

  • Page 56
    ... ownership of options or other derivative securities of the Company, whether privately or publicly traded, by any significant shareholder of the Company that is not a member of the Board of Directors or an executive officer. 1.3 Cross-shareholdings Logitech has no shareholdings in companies that to...

  • Page 57
    ... connection with a future issuance of debt obligations convertible into Logitech shares. 2.3 Changes in Shareholders' Equity As of March 31, 2008, 2007, 2006 and 2005, balances in shareholders' equity of Logitech International S.A., based on the parent company's Swiss Statutory Financial Statements...

  • Page 58
    ... to "Additional Financial Disclosures - Market for Logitech's Shares, Related Shareholder Matters, and Share Repurchases" in our Annual Report. 2.4 Share Categories Registered Shares. Logitech International S.A. has only one category of shares - registered shares with a par value of CHF 0.25 per...

  • Page 59
    ... the share register is recognized by the Company only to the extent we are notified of the transfer. Refer to section 6.1 for the conditions for exercise of shareholders' voting rights. 2.7 Conversion and Option Rights Logitech does not have any outstanding bonds or other publicly traded securities...

  • Page 60
    ... was Vice President and Chief Financial Officer of Vxtreme, Inc., a U.S. developer of internet video streaming products. Prior to that time, Mr. Bengier was Corporate Controller at Compass Design Automation, a U.S. publisher of electronic circuit design software, from February 1993 to February...

  • Page 61
    ... University. Mr. Chang is also Vice Chairman of the Company's subsidiary in Taiwan. Kee-Lock Chua has been a member of the Board of Directors since June 2000. He is an Executive Director of Biosensors International Group, Ltd., a developer and manufacturer of medical devices used in interventional...

  • Page 62
    ... Luca holds a BS degree in Electronic Engineering from the University of Rome, Italy. Robert Malcolm has been a member of the Board of Directors since June 2007. He is the President, Global Marketing, Sales and Innovation at Diageo plc, the global premium drinks company. He joined Diageo in 1999 and...

  • Page 63
    ... of Global Sales and Operations for the Consumer and Professional Imaging Division and previously held senior sales or marketing management positions in the United States, Japan and Asia Pacific. Prior to his 17 year tenure at Eastman Kodak, he worked for Mobil Oil Corporation in engineering. Mr...

  • Page 64
    ... ...51 Years Old Senior Vice President, Customer Experience and Chief Marketing Officer U.S. national David Henry joined Logitech as Senior Vice President, Control Devices Business Unit, in August 2001 and was named Senior Vice President, Customer Experience and Chief Marketing Officer in March...

  • Page 65
    ... of two-thirds of the votes represented, including the following change in the Company's corporate purpose; creation of shares with privileged voting rights; restriction of the transferability of the shares; creation of authorized or conditional capital; capital increases to be paid-in by means...

  • Page 66
    ... Apples, Switzerland, or c/o Logitech Inc., 6505 Kaiser Drive, Fremont, CA 94555, USA. 6.5 Registration in the Company's Share Register Registration into the Company's share register, or the sub-register maintained by the Company's U.S. transfer agent, The Bank of New York Mellon Corporation, occurs...

  • Page 67
    ... payments in the event of termination of service of an executive officer or a change-in-control of Logitech. 8. Auditors Under the Company's Articles of Incorporation, the shareholders appoint the Company's independent registered public accounting firm each year at the Annual General Meeting...

  • Page 68
    ...to ask questions of the Chief Executive Officer and Chief Financial Officer. Logitech also holds twice-annual analyst days where senior management present reviews of Logitech's business. These events are webcast and remain available on Logitech's Investor Relations website for a period of time after...

  • Page 69
    LOGITECH INTERNATIONAL S.A. Consolidated Subsidiaries [OPEN] Group Holding % Name of Subsidiary Jurisdiction of Incorporation Share Capital EUROPE 3Dconnexion GmbH ...3Dconnexion Holding S.A...3Dconnexion Polska Sp z.o.o...Labtec Europe S.A...Logi Trading and Services Limited Liability Company ...

  • Page 70
    ...Group Holding % Share Capital ASIA PACIFIC LogiCool Co., Ltd...Logitech Electronic (India) Private Limited ...Logitech Far East, Ltd...Logitech Hong Kong Limited ...Logitech Korea Ltd...Logitech New Zealand Co., Ltd...Logitech Service Asia Pacific Pte. Ltd...Logitech Singapore Pte. Ltd...Logitech...

  • Page 71
    ...TO CONSOLIDATED FINANCIAL STATEMENTS Page Report of the Group Auditors to the General Meeting of Logitech International S.A...Consolidated ...of Changes in Shareholders' Equity - Years Ended March 31, 2008, 2007 and 2006 ...Notes to Consolidated Financial Statements ...Unaudited Quarterly Financial ...

  • Page 72
    ...AUDITORS TO THE GENERAL MEETING OF LOGITECH INTERNATIONAL S.A. APPLES, SWITZERLAND As auditors of the group, we have audited the consolidated financial statements (balance sheet, income statement, statement of cash flows, statement of changes in equity and notes) of Logitech International SA for the...

  • Page 73
    ...tax benefit, related to employee stock options and employee stock purchases. The consolidated statement of income for fiscal year 2006 does not include the effect of share-based compensation expense, because the Company implemented SFAS 123R using the modified prospective transition method effective...

  • Page 74
    LOGITECH INTERNATIONAL S.A. CONSOLIDATED BALANCE SHEETS (In thousands, except share and per share amounts) March 31, 2008 2007 ASSETS Current assets: Cash and cash equivalents ...Short-term investments ...Accounts receivable ...Inventories ...Other current assets ...Total current assets...Property,...

  • Page 75
    ...intangible assets...Share-based compensation expense related to options and purchase rights...Write-down of investments ...Gain on sale of investment ...Excess tax benefits from share-based compensation ...Gain on cash surrender value of life insurance policies ...In-process research and development...

  • Page 76
    ...158, net of tax of $859 ...Tax benefit from exercise of stock options...Purchase of treasury shares ...Sale of shares upon exercise of options and purchase rights ...Share-based compensation expense related to employee stock options and stock purchase plan...March 31, 2007 ...Net income...Cumulative...

  • Page 77
    ... company with its registered office in Apples, Switzerland, which conducts its business through subsidiaries in North America, Europe and Asia Pacific. Shares of Logitech International S.A. trade on both the Nasdaq Global Select Market, under the trading symbol LOGI, and the SWX Swiss Exchange...

  • Page 78
    ... to purchase volumes or sales of specific products by distributors to specified retailers. Consumer rebates are offered from time to time at the Company's discretion directly to end-users. Contractual volume rebates to distribution or retail customers are recognized as a reduction of the sale price...

  • Page 79
    ..., one customer represented 16% of total accounts receivable. Typical payment terms require customers to pay for product sales generally within 30 to 60 days; however terms may vary by customer type, by country and by selling season. Extended payment terms are sometimes offered to a limited number of...

  • Page 80
    LOGITECH INTERNATIONAL S.A. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) The Company's OEM customers tend to be well-capitalized, multi-national companies, while distributors and key retailers may be less well-capitalized. The Company manages its accounts receivable credit risk through ...

  • Page 81
    LOGITECH INTERNATIONAL S.A. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) Goodwill and Other Intangible Assets The Company's intangible assets principally include goodwill, acquired technology, trademarks, customer contracts and customer relationships, and other. Intangible assets with ...

  • Page 82
    ... for Stock Issued to Employees" ("APB 25"). In March 2005, the Securities and Exchange Commission ("SEC") issued Staff Accounting Bulletin No. 107 ("SAB 107") regarding the SEC's interpretation of SFAS 123R and the valuation of share-based payments for public companies. Logitech has applied...

  • Page 83
    ... gains and losses on marketable equity securities, net deferred gains and losses and prior service costs for defined benefit pension plans, and net deferred gains and losses on hedging activity. Derivative Financial Instruments The Company enters into foreign exchange forward contracts to reduce the...

  • Page 84
    LOGITECH INTERNATIONAL S.A. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) are not recognized or disclosed at fair value in an entity's financial statements on a recurring basis (at least annually). We are currently evaluating the impact that SFAS 157 and FSP 157-2 will have on the Company's...

  • Page 85
    ...which is calculated based on the average share price for each fiscal period using the treasury stock method. Under the treasury stock method, the amount that the employee must pay for exercising stock options, the amount of compensation cost for future service that the Company has not yet recognized...

  • Page 86
    ... November 2007, the Company acquired WiLife, Inc. ("WiLife"), a privately held company that manufactures PC-based video cameras for self-monitoring a home or a small business. The acquisition is part of the Company's strategy to expand its presence in digital home products. Total consideration paid...

  • Page 87
    ... tax liability related to intangible assets. In October 2006, the Company acquired Slim Devices, Inc. ("Slim Devices"), a privately held company specializing in network-based audio systems for digital music, based in Mountain View, California. The acquisition is part of the Company's strategy to...

  • Page 88
    ... purchase agreement, the Company acquired all of the outstanding shares of Slim Devices for $20.0 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...

  • Page 89
    ... ...Allowance for returns...Allowances for customer programs ...Inventories: Raw materials...Work-in-process ...Finished goods ...Other current assets: Tax and VAT refund receivables ...Deferred taxes ...Prepaid expenses and other ...Property, plant and equipment: Plant and buildings...Equipment...

  • Page 90
    ... the Anoto board of directors. The license agreement required Logitech to pay a license fee for the rights to use the Anoto technology and a license fee on the sales value of digital pen solutions sold by Logitech. Also, the agreement included non-recurring engineering ("NRE") service fees primarily...

  • Page 91
    ... exchange, the same Logitech shares trade on the Nasdaq Global Select Market and the SWX Swiss Exchange. Since the exchange of the Nasdaq-listed ADSs for Logitech shares was a one-for-one exchange, there was no impact on financial statement or per share amounts. Stock Split In June 2006, the Company...

  • Page 92
    ... from conditional share capital. Dividends Pursuant to Swiss corporate law, Logitech International S.A. may only pay dividends in Swiss francs. The payment of dividends is limited to certain amounts of unappropriated retained earnings (CHF 316.6 million or $318.1 million based on exchange rates at...

  • Page 93
    ... under this plan. The Company follows the accounting provisions of Statement of Financial Accounting Standards No. 123 (revised 2004), "Share-based Payment" ("SFAS 123R"), for share-based awards granted to employees and directors including stock options and share purchases under the 2006 ESPP and...

  • Page 94
    ... stock option awards as all options were granted with an exercise price equal to the market value of the underlying common stock on the date of grant. The employee stock purchases were deemed non-compensatory under the provisions of APB 25. If the Company had used SFAS 123 to account for share-based...

  • Page 95
    LOGITECH INTERNATIONAL S.A. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) The fair value of employee stock options granted and shares purchased under the Company's employee purchase plans was estimated using the Black-Scholes-Merton option-pricing valuation model applying the following ...

  • Page 96
    ... table represents the total pretax intrinsic value, based on options with an exercise price less than the Company's closing price of $25.44 at March 31, 2008, which would have been received by the option holders had these option holders exercised their options as of that date. The total number of...

  • Page 97
    LOGITECH INTERNATIONAL S.A. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) Defined Benefit Plans Certain of the Company's subsidiaries sponsor defined benefit pension plans covering substantially all of their employees. Retirement benefits are provided based on employees' years of service ...

  • Page 98
    ...): March 31, 2008 2007 Fair value of plan assets, beginning of year ...Actual return on plan assets ...Employer contributions ...Plan participant contributions...Benefits paid ...Administrative expenses paid ...Foreign currency exchange rate changes ...Fair value of plan assets, end of year...

  • Page 99
    ...2.50% to 4.25% The discount rate is estimated based on relevant bond market yields. The Company bases the compensation increase assumptions on historical experience and future expectations. The expected average rate of return for the Company's retirement benefit plans represents the average rate of...

  • Page 100
    ... Plan One of the Company's subsidiaries offers a management deferred compensation plan which permits eligible employees to make 100%-vested salary and incentive compensation deferrals within established limits, which are invested in Company-owned life insurance contracts held in a Rabbi Trust...

  • Page 101
    .... The tax holiday represents a tax exemption aimed to attract foreign technological investment in China. The tax holiday decreased income tax expense by approximately $1.5 million and $2.5 million for fiscal years 2008 and 2007. The benefit of the tax holiday on net income per share (diluted) was...

  • Page 102
    ... FINANCIAL STATEMENTS-(Continued) Deferred tax assets relating to tax benefits of employee stock option grants have been reduced to reflect exercises in fiscal years 2008 and 2007. Some exercises resulted in tax deductions in excess of previously recorded benefits based on the option value...

  • Page 103
    ... tax benefits would materially change in the next 12 months. Note 14 - Derivative Financial Instruments - Foreign Exchange Hedging The Company enters into foreign exchange forward contracts to reduce the short-term effects of foreign currency fluctuations on certain foreign currency receivables or...

  • Page 104
    ... for digital music. The purchase agreement provides for 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. The...

  • Page 105
    LOGITECH INTERNATIONAL S.A. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) based payment is based on net revenues attributed to WiLife during calendar 2010. No payment is due if the applicable net revenues total $40.0 million or less. The maximum performance-based payment is $64.0 million. ...

  • Page 106
    ..., one customer represented 16% of total accounts receivable. Net sales by product family for fiscal years 2007, 2006 and 2005 were as follows (in thousands): 2008 Year ended March 31, 2007 2006 Retail - Pointing Devices ...Retail - Keyboards & Desktops ...Retail - Audio ...Retail - Video ...Retail...

  • Page 107
    ... base salary includes a salary for his service as Chairman of the Board from 4/1/07 through 12/31/07. Bonus represents compensation from the Company's non-equity compensation plans. Amounts shown reflect the compensation expenses recognized by Logitech in fiscal year 2008 for the applicable Option...

  • Page 108
    ... Officer and President of the Company prior to his becoming Chairman of the Board. Mr. Chang received options to purchase 30,000 shares of Logitech stock in his capacity as a Board member. The remainder of these awards were made to Mr. Chang in his former role as Senior Vice President, Worldwide...

  • Page 109
    ...31, 2007 Second Third Fourth Net sales...Gross profit ...Operating expenses: Marketing and selling ...Research and development ...General and administrative ...Total operating expense . . Operating income ...Net income...Net income per share: Basic ...Diluted...Shares used to compute net income per...

  • Page 110
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  • Page 111
    LOGITECH INTERNATIONAL S.A., APPLES SWISS STATUTORY FINANCIAL STATEMENTS

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    LOGITECH INTERNATIONAL S.A., APPLES SWISS STATUTORY FINANCIAL STATEMENTS TABLE OF CONTENTS Page Swiss Statutory Balance Sheets (unconsolidated) ...Swiss Statutory Statements of Income (unconsolidated) ...Notes to Swiss Statutory Financial Statements ...Proposal of the Board of Directors for ...

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    ... SHAREHOLDERS' EQUITY Current liabilities: Payables to group companies...Accruals and other liabilities ...Deferred unrealized exchange gains ...Total current liabilities ...Long-term liabilities: Payables to group companies...Total liabilities ...Shareholders' equity: Share capital...Legal reserves...

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    ...,178 CHF 60,405 Administrative expenses ...Brand development expenses ...Amortization of intangibles ...Interest paid to subsidiaries ...Income, capital and non-recoverable withholding taxes ...Loss on disposal of treasury shares ...Fair value adjustment of treasury shares ...Realized loss on sales...

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    ... include the following: Company Country % of possession Currency Share capital Purpose Logitech Europe S.A... Switzerland 100 CHF Logitech Inc ... U.S.A 100 USD Logitech (Intrigue) Inc... Canada 100 CAD 100,000 Administration, research, development, sales and distribution 11,522,396...

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    ...,000 registered shares for approximately USD 45,282,000. Treasury shares are recorded as a long-term asset at the lower of cost or market value. The disposal of treasury shares during the period was to the Company's directors and employees under the Holding Company's share option and share purchase...

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    LOGITECH INTERNATIONAL S.A., APPLES NOTES TO SWISS STATUTORY FINANCIAL STATEMENTS-(Continued) Authorized capital In June 2006, the Company's shareholders renewed their approval of 40,000,000 authorized registered shares for use in acquisitions, mergers and other similar transactions, valid through ...

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    LOGITECH INTERNATIONAL S.A., APPLES NOTES TO SWISS STATUTORY FINANCIAL STATEMENTS-(Continued) (4) Number of shares held by FMR LLC is based on a notification received by the Company on November 29, 2007 informing the Company that the ownership of FMR LLC, on behalf of funds managed by and clients of...

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    ... OF RETAINED EARNINGS Proposal of the Board of Directors for appropriation of retained earnings was as follows during fiscal years 2007 and 2008 (in thousands): Year ended March 31, 2008 2007 Proposal of the Board of Directors To be carried forward ...CHF 316,586 Resolution of the General...

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    ... and notes) of Logitech International SA for the year ended March 31, 2008. These financial statements are the responsibility of the board of directors. Our responsibility is to express an opinion on these financial statements based on our audit. We confirm that we meet the legal requirements...

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    ... Information Technology and Chief Financial Officer David Henry Senior Vice President, Customer Experience and Chief Marketing Officer Junien Labrousse Executive Vice President, Products L. Joseph Sullivan Senior Vice President, Worldwide Operations Guerrino De Luca Chairman of the Board Gerald...

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    Holding Company Logitech International S.A. CH-1143 Apples Switzerland Americas Logitech Inc. 6505 Kaiser Drive Fremont, CA 94555 United States Asia Pacific Logitech Asia Pacific Ltd. Room 1408-10 China Resources Building 26 Harbour Road Wanchai, Hong Kong Europe Logitech Europe S.A. Moulin du ...