Plantronics 2008 Annual Report Download - page 43

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37
the costs associated with the expansion of our ACG design centers in Tijuana, Mexico and Suzhou, China, stock-based
compensation charges of $3.8 million, of which $3.7 million related to ACG and AEG expenses reflecting a full year of expenses
compared to only seven and one-half months of expenses in fiscal 2006.
We anticipate that our consolidated research, development and engineering expenses in fiscal 2009 will be relatively flat in
comparison to fiscal 2008.
Selling, General and Administrative
Selling, general and administrative expense consists primarily of compensation costs, marketing costs, professional service fees,
travel expenses, litigation costs, bad debt expense and allocation of overhead expenses, including facilities, human resources and
IT costs.
Consolidated
(in thousands)
Selling, general and administrative $ 153,094 $ 182,108 $ 29,014 19.0% $ 182,108 $ 189,156 $ 7,048 3.9%
% of total consolidated net revenues 20.4% 22.7% 2.3 ppt. 22.7% 22.1% (0.6) ppt.
Fiscal Year Ended Fiscal Year Ended
March 31, March 31, Increase March 31, March 31, Increase
2006 2007 (Decrease) 2007 2008 (Decrease)
Audio Communications Group
Selling, general and administrative $ 132,867 $ 151,857 $ 18,990 14.3% $ 151,857 $ 163,173 $ 11,316 7.5%
% of total segment net revenues 21.1% 22.5% 1.4 ppt. 22.5% 21.8% (0.7) ppt.
Audio Entertainment Group
Selling, general and administrative $ 20,227 $ 30,251 $ 10,024 49.6% $ 30,251 $ 25,983 $ (4,268) (14.1)%
% of total segment net revenues 16.8% 24.5% 7.7 ppt. 24.5% 23.9% (0.6) ppt.
In fiscal 2008, compared to fiscal 2007, consolidated selling, general and administrative expenses increased due to increased
compensation as a result of merit increases and higher bonus and commission costs associated with higher net revenues and
profits in ACG, partially offset by a decrease in expenses in AEG.
Fluctuations in the selling, general and administrative expenses of ACG and AEG in fiscal 2008 compared to fiscal 2007 were as
follows:
ACG
Selling, general and administrative expenses increased due to the following:
· increased compensation expense of $11.8 million as a result of merit increases and higher bonus and commission costs
associated with higher net revenues and profits;
· increased professional service fees of $3.4 million primarily related to increased retail rep fees resulting from higher net
revenues and increased fees for accounting and tax services;
· decreased marketing and sales promotions of $3.8 million.