Logitech 2012 Annual Report Download - page 186

Liquidity and Capital Resources
Cash Balances, Available Borrowings, and Capital Resources
At March 31, 2012, our working capital was $576.7 million, compared with $605.7 million at March 31, 2011.
The decrease in working capital over the prior year was primarily due to the decrease in accounts receivable, offset
in part by an increase in inventory.
During fiscal year 2012, operating activities provided net cash of $196.1 million, generated from operations,
cash collections on accounts receivables, and increases in current liabilities. We used $51.2 million in investing
activities, including $47.8 million for investments in tooling, computer hardware and software, and leasehold
improvements. Net cash used by financing activities was $139.4 million, primarily for the repurchase of shares
under our share buyback program, offset in part by proceeds of employee stock purchases and the exercise of
stock options.
At March 31, 2012, we had cash and cash equivalents of $478.4 million. Our cash and cash equivalents are
comprised of bank demand deposits and short-term time deposits carried at cost, which is equivalent to fair value.
Approximately 66% of our cash and cash equivalents are held by our Swiss-based entities, and approximately 27%
is held by our subsidiaries in Hong Kong and China. We do not believe we would be subject to any material adverse
tax impact or significantly inhibited by any country in which we do business from the repatriation of funds to
Switzerland, our home domicile.
In December 2011, the Company entered into a Senior Revolving Credit Facility Agreement with a group of
primarily Swiss banks that provides for a revolving multicurrency unsecured credit facility in an amount of up to
$250.0 million. The Company may, upon notice to the lenders and subject to certain requirements, arrange with
existing or new lenders to provide up to an aggregate of $150.0 million in additional commitments, for a total of
$400.0 million of unsecured revolving credit. The credit facility may be used for working capital, general corporate
purposes, and acquisitions. There were no outstanding borrowings under the credit facility at March 31, 2012.
The credit facility matures on October 31, 2016. The Company may prepay the loans under the credit facility
in whole or in part at any time without premium or penalty. Borrowings under the credit facility will accrue interest
at a per annum rate based on LIBOR (London Interbank Offered Rate), or EURIBOR (Euro Interbank Offered
Rate) in the case of loans denominated in euros, plus a variable margin determined quarterly based on the ratio of
senior debt to earnings before interest, taxes, depreciation and amortization for the preceding four-quarter period,
plus, if applicable, an additional rate per annum intended to compensate the lenders for the cost of compliance with
regulatory reserve requirements and other banking regulations. The Company also pays a quarterly commitment
fee of 40% of the applicable margin on the available commitment. In connection with entering into the credit
facility, the Company incurred non-recurring fees totaling $1.5 million, which are amortized on a straight-line basis
over the term of the credit facility.
The facility agreement contains representations, covenants and events of default customary in Swiss credit
markets. Affirmative covenants include covenants regarding reporting requirements, maintenance of insurance,
maintenance of properties and compliance with applicable laws and regulations, and financial covenants that
require the maintenance of net senior debt, interest cover and adjusted equity ratios determined in accordance with
the terms of the facility. Negative covenants limit the ability of the Company and its subsidiaries, among other
things, to grant liens, make investments, incur debt, make restricted payments, enter into a merger or acquisition,
or sell, transfer or dispose of assets, in each case subject to certain exceptions. As of March 31, 2012, the Company
was in compliance with all covenants and conditions.
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