Press Release: Poly Announces Third Quarter Fiscal Year 2021 Financial Results

· 02/04/2021 16:05

Q4 FY21 Guidance GAAP Net Revenue $438M - $468M Non-GAAP Revenue $440M - $470M Adjusted EBITDA(1) $70M - $80M Non-GAAP Diluted EPS(1,2) $0.80 - $1.00 (1) Q4 Adjusted EBITDA and non-GAAP diluted EPS guidance excludes estimated intangibles amortization expense of $30.4 million. With respect to adjusted EBITDA and diluted EPS guidance, the Company has determined that it is unable to provide quantitative reconciliations of these forward-looking non-GAAP measures to the most directly comparable forward-looking GAAP measures with a reasonable degree of confidence in their accuracy without unreasonable effort, as items including stock based compensation, litigation gains and losses, and impacts from discrete tax adjustments and tax laws are inherently uncertain and depend on various factors, many of which are beyond the Company's control. (2) Non-GAAP diluted EPS guidance assumes approximately 43 million diluted average weighted shares and a non-GAAP effective tax rate of 12% to 14%. There are several discreet tax items, which if resolved in the quarter, may favorably impact the GAAP and non-GAAP tax rates. The timing and magnitude of these items is difficult to predict. As a result, the Company has provided a non-GAAP effective tax rate range exclusive of these items.($ Millions, except percent and per-share data)(1) Q3 FY21 Q3 FY20 YTD FY21 YTD FY20 GAAP Revenue $485 $384 $1,251 $1,294 GAAP Gross Margin 46.8 % 37.4 % 45.0 % 43.5 % GAAP Operating Income / (Loss) $29 ($77) ($22) ($111) GAAP Diluted EPS $0.48 ($1.97) ($1.67) ($3.78) Cash Flow from Operations $31 ($17) $71 $16 Non-GAAP Revenue $488 $392 $1,264 $1,322 Non-GAAP Gross Margin 50.7 % 49.4 % 49.9 % 52.7 % Non-GAAP Operating Income $90 $31 $186 $198 Non-GAAP Diluted EPS $1.47 $0.30 $2.75 $2.85 Adjusted EBITDA $100 $43 $216 $234 (1) For further information on supplemental non-GAAP metrics refer to the Use of Non-GAAP Financial Information and Unaudited Reconciliations of GAAP Measures to Non-GAAP Measures sections below. Results Compared to October 29, 2020 Guidance Q3 FY21 Results Q3 FY21 Guidance Range(2) GAAP Net Revenue $485M $417M - $447M Non-GAAP Net Revenue $488M $420M - $450M Adjusted EBITDA $100M $70M - $80M Non-GAAP Diluted EPS $1.47 $0.85 - $1.05 (2) The non-GAAP revenue guidance range shown here excludes the $3.3 million impact of purchase accounting related to recording deferred revenue at fair value at the time of the acquisition.-- Poly posted record Professional Headset and Video revenues, with unit shipments more than doubling in each category year over year, reflecting the massive shift in the way work is done, where work is done, and the importance of reliable, high-fidelity connectivity. -- The Company announced the Poly Studio P Series, a new family of sophisticated prosumer video solutions, addressing the growing need for tools that allow professionals to work from anywhere, connect easily using any platform, and enjoy enterprise-grade service and support. -- The Company also announced Poly Lens Desktop App and Poly+. Poly Lens provides insights and management capabilities for voice, video, and headsets under a single pane of glass, while Poly+ is a personal device service providing 24/7 tech-support, overnight replacement, and advanced troubleshooting tools. -- Microban and Poly announced an exclusive relationship in which Microban's antimicrobial technology will be incorporated into Poly high-touch collaboration devices. -- Ongoing operational and turnaround efforts continue to show momentum and bottom-line results. Key additions have been made to the executive leadership team, including the appointments of Grant Hoffman as EVP Chief Supply Chain Officer, Gloria Loredo as Chief Transformation Officer, Lisa Bodensteiner as EVP Chief Legal and Compliance Officer and Corporate Secretary, and John Goodwin as SVP, Public Affairs. -- The Company generated $31M in operating cash flow, retired $12M of debt, and ended the quarter with $245M in cash and short-term investments, setting the stage for continued de-levering.

Poly Announces Third Quarter Fiscal Year 2021 Financial Results

Delivers Strong Revenue and Profitability Driven by Record Professional Headset and Video Revenues as Long-Term Trends Toward Remote Work and Video Collaboration Accelerate

New Products, Partnerships, and Distribution Strategies Target Post-Pandemic Environment and Evolving Purchasing Patterns

Improved Operational Execution Drives Solid Operating Cash Flow

PR Newswire

SANTA CRUZ, Calif., Feb. 4, 2021

SANTA CRUZ, Calif., Feb. 4, 2021 /PRNewswire/ -- Poly (NYSE: PLT), a global outfitter of professional-grade audio and video technology, today announced third quarter results for the period ended December 26, 2020.

Highlights for the third quarter include:

"We believe the end markets for professional-grade communications gear have permanently expanded, because work is no longer a place, it's what you do," said Dave Shull, Poly President and Chief Executive Officer. "In a world less dependent on being in the same room, but still demanding live interaction, the importance of pro-grade, easy-to-use technology that offers a superior remote experience is paramount. Poly is a company built on connecting people. And customers are responding because we offer superior products and services."

"We continue to operate with a sense of urgency as it relates to improving our operations," said Chuck Boynton, Executive Vice President and Chief Financial Officer. "We've taken concrete steps to control costs, make disciplined investments in new products, and balance supply chain exposures. And we're seeing that tactical execution reflected in this quarter's results. In particular, the strong profitability and cash flow we posted today allows us to accelerate de-levering, as debt reduction remains a top priority."

Business Outlook

The following statements are based on the Company's current expectations, and many of these statements are forward-looking. Actual results are subject to a variety of risks and uncertainties and may differ materially from the Company's expectations. Please refer to the Forward Looking Statements Safe Harbor section of this press release below.

The following represents the expected range of financial results for the fiscal fourth quarter of 2021 (all amounts assume currency rates remain stable):

Conference Call and Earnings Presentation

Poly is providing an earnings presentation in combination with this press release. The presentation is offered to provide shareholders and analysts with additional detail for analyzing results. The presentation will be available in the Investor Relations section of our corporate website at investor.poly.com along with this press release. A reconciliation of our GAAP to non-GAAP results is provided at the end of this press release.

We have scheduled a webcast to discuss third quarter fiscal year 2021 financial results. The webcast will take place today, February 4, 2021, at 2:00 PM (Pacific Time). All interested investors and potential investors in Poly stock are invited to join. To listen to the webcast, please access the webcast link from our Investor Relations website at investor.poly.com.

A replay of the webcast will be available shortly after its conclusion and can be accessed from our Investor Relations website at investor.poly.com.

Forward Looking Statements Safe Harbor

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements relating to our intentions, beliefs, projections, outlook, analyses or current expectations that are subject to many risks and uncertainties. Such forward-looking statements and the associated risks and uncertainties include, but are not limited to: (i) our beliefs with respect to the length and severity of the COVID-19 (coronavirus) outbreak, and its impact across our businesses, our operations and global supply chain, including (a) our expectations the virus has caused and will continue to cause an increase in customer and partner demand for our product lines, including increased demand in collaboration endpoints, and our ability to design new product offerings to meet the change in demand due to a global hybrid work environment; (b) risks related to increased freight and other costs associated with expediting shipment and delivery of high-demand products to key markets in order to meet customer demand, (c) our inability to source component parts from key suppliers in sufficient quantities necessary to meet the high demand for certain product lines, including our Enterprise Headsets and continued uncertainty and potential impact on future quarters if sourcing constraints continue and/or price volatility occurs, which could continue to negatively affect our profitability and/or market share; (d) expectations related to our voice product lines, as well as our services attachment rate for such products, which have been, and may continue to be, negatively impacted as companies have delayed returning their workforces to offices in many countries due to the continued impact of COVID-19; (e) expectations related to our ability to fulfill the backlog generated by supply constraints, to

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February 04, 2021 16:05 ET (21:05 GMT)