Plantronics reports record 2015 numbers despite Q4 slowdown

Ken Kannappan
Ken Kannappan

SANTA CRUZ—Despite a slowdown in the quarter related to exchange rates, product delays and shifting consumer trends, Plantronics announced Monday record revenues, operating income and earnings per share for the year. 

Revenues grew 6 percent over the year to $865 million and earnings per share grew 7 percent to $3.04.

Ken Kannappan, president and CEO, said the company’s market position was “outstanding” and its pace of innovation was “unequalled.” He vowed to simplify office communications technology and provide equipment that helped keep employees in “the zone.”

“We’re already at the forefront of this opportunity,” Kannappan said during a conference call with analysts before markets opened Monday.

The idea is to solve noise and productivity issues that disrupt employees in typically open work environments and help incorporate “smart” technology that aids in common communication problems such as people talking over each other.

Executives said they expect the company’s market to grow from $2.7 billion to $4.3 billion in 2019.

The company is largely focused on the growing market of unified communications, technology that combines platforms for audio, video, messaging for both mobile and office. UC revenues grew 18 percent during fiscal 2015 and represented 23 percent of total Plantronics revenues.

In the fourth quarter, UC revenues grew 5 percent from a year ago; consumer revenues dropped 11 percent and its core enterprise revenues dropped 4 percent.

“Unified communications continues to represent our largest revenue and profit opportunity and our leadership in the category is as strong as ever,” Kannappan said. “… We continue to believe we are in the very early days of this opportunity.”

Other contributors to lower sales included declines in Russian sales, cuts in the energy industry and a pending launch of Microsoft’s new UC platform Skype For Business.

In other company news during the fourth quarter, the Santa Cruz headset maker recently hired on a new president for its Clarity division, announced a $50M credit extension for business operations and a stock buy back program and promised to give shareholders a higher dividend percentage of earnings.

Plantronics also celebrated a 2015 Business Environmental Award in the category of Small/Medium Environmental Project for its on-site hydroponic micro-farm and several design awards.

 

COMPANY SNAPSHOT

Plantronics Inc.

WHAT: A publicly held audio communications headset manufacturer for businesses and consumers.

HEADQUARTERS: 345 Encinal St., Santa Cruz

BACKGROUND: Founded in 1961, Plantronics introduced the first lightweight communications headset in 1962.

LEADERSHIP: Ken Kannappan, president and chief executive officer.

EMPLOYEES: The company employs about 3,447 people worldwide, including about 540 in Santa Cruz.

INFORMATION: 831-426-5858; http://www.plantronics.com.

STOCK PRICE: Shares trading on the NYSE under the ticker PLT closed Monday at $54.73 down $1.26. The 52-week range is $41.21–$57.90.

FINANCIALS: Fourth quarter 2014 net revenues were $200.76 million compared to $209.07 million a year ago. Net income was $ $25.82 million, or 61 cents per diluted share, compared to $ 27.94 million, or 65 cents per diluted share, a year ago. For 2015, net revenues were $865.01 million compared with $818.6 million in 2014. Diluted earnings per share were $2.63 compared to $2.59 a year ago.

DIVIDEND: The company announced a quarterly dividend of 15 cents per share to be paid June 10 to all shareholders of record on May. 20.

GUIDANCE: The company expects revenues of $202 million to $212 million and diluted earnings per share of 62-71 cents for the first fiscal quarter of 2016, which ends in June.

 

Santa Cruz Sentinel article online

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