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Plantronics Posts Higher Fiscal Q2 Sales, Earnings

10/23/2007 06:48:00 PM Eastern


Santa Cruz, Calif. — Plantronics reported higher net revenues and net earnings for its fiscal second quarter, ended Sept. 30.

Net revenues were $208.2 million for the quarter compared with last year’s $194.9 million while net income was $16.5 million for the quarter vs. $12.5 million for the same time last year.

“Our most important long term objective has been to grow our office business and we were pleased with the increase in our office wireless revenues. Our gross margin also improved as our focus on reducing product cost and increasing manufacturing effectiveness resulted in nearly three points of gross margin improvement in the ACG segment. Finally, we introduced and started shipping some important new Bluetooth, consumer entertainment and home office products in the second quarter. These new products have received an excellent reception from the market,” stated Ken Kannappan, president/CEO in a prepared statement.

In its Audio Communications Group (ACG) that includes office and contact center, mobile, computer and clarity products, second quarter net revenues of $181.0 million were up 11 percent compared with $163.0 million in the year-ago quarter. Revenue growth compared with the year-ago quarter was driven by demand for wireless products, with office wireless up by 28 percent from a year ago and mobile Bluetooth up 17 percent from the same period. The CS70N, introduced in May, contributed significantly to the growth in office wireless this quarter. Gross margin in the quarter was 47.2 percent compared with 44.3 percent in the year-ago quarter.

Audio Entertainment Group (AEG) which includes Altec Lansing reported second-quarter net revenues of $27.2 million were down 14.8 percent from $31.9 million in the year-ago quarter. While the turnaround of this division remains heavily dependent on a refreshed product portfolio, other steps are being taken to return the unit to profitability, including new management, Plantronics said.

The division’s gross margin was 0.4 percent compared with 16.9 percent in the year-ago quarter. Operating loss was $9.6 million in the quarter compared with an operating loss of $4.5 million in the same quarter of the prior year.

While results were lower than the year-ago quarter, revenues grew sequentially mostly on the strength of the iM600, the loss was reduced and the division performed slightly better than the company anticipated. During the quarter, AEG also began shipping a number of new products, including the PT 7031 wireless home theatre sound system and PT 8050 wireless surround sound home theatre system, the company said.

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