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UNITED STATES
 
SECURITIES AND EXCHANGE COMMISSION
 
Washington, D.C. 20549
 
 
FORM 10-Q
 
 
(Mark One)
 
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the quarterly period ended December 31, 2004
 
 
OR
 
 
[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
 
For the transition period from ________to _________
 
 
Commission file number 1-12696
 
 
Plantronics, Inc.
 
 
(Exact name of registrant as specified in its charter)
 
 
Delaware
 
 
77-0207692
 
 
  (State or other jurisdiction of incorporation or organization) 
 
 
(I.R.S. Employer Identification Number)
 
345 Encinal Street
Santa Cruz, California   95060
(Address of principal executive offices)
(Zip Code)

(831) 426-5858
(Registrant's telephone number, including area code)
 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X ] No [ ]
 
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act) Yes [X ] No [ ]
 
  The number of shares outstanding of Plantronics’ common stock as of January 28, 2005 was 49,060,654
 
   
 
Plantronics, Inc.
FORM 10-Q
TABLE OF CONTENTS
 
PART I. FINANCIAL INFORMATION
Page No.
 
  
 
 
  
 
Item 1. Financial Statements (unaudited):
 
           Balance Sheets as of March 31, 2004 and December 31, 2004
3
           Statements of Operations for the Three and Nine Months Ended December 31, 2003 and 2004
4
           Statements of Cash Flows for the Nine Months Ended December 31, 2003 and 2004
5
           Notes to Financial Statements
6
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
16
Item 3. Quantitative and Qualitative Disclosures About Market Risk
37
Item 4. Controls and Procedures
39
 
PART II. OTHER INFORMATION
 
 
 
Item 1. Legal Proceedings
40
Item 6. Exhibits
40
Signatures
43
   

 
  2  
 

Part I -- FINANCIAL INFORMATION
Item 1. Financial Statements
PLANTRONICS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except par value amounts)
(Unaudited)
March 31,
December 31,
  
   
2004
 
2004
 
ASSETS
              
Current assets:
              
Cash and cash equivalents
  
$
180,616
  
$
219,345
  
Marketable securities
    
-
   
10,500
 
Accounts receivable, net
    
64,999
   
90,260
 
Inventories
    
40,762
   
75,074
 
Deferred income taxes
    
13,967
   
8,544
 
Other current assets
    
10,283
   
9,919
 
Total current assets
    
310,627
   
413,642
 
Property, plant and equipment, net
    
42,124
   
52,455
 
Intangibles, net
    
3,440
   
3,137
 
Goodwill
    
9,386
   
9,386
 
Other assets
    
2,675
   
3,075
 
Total assets
  
$
368,252
  
$
481,695
  
               
LIABILITIES AND STOCKHOLDERS' EQUITY
              
Current liabilities:
              
Accounts payable
  
$
19,075
  
$
24,318
  
Accrued liabilities
    
36,469
   
43,833
 
Income taxes payable
    
5,686
   
5,205
 
Total current liabilities
    
61,230
   
73,356
 
Deferred tax liability
    
7,719
   
8,154
 
Total liabilities
    
68,949
   
81,510
 
               
Stockholders' equity:
              
Preferred stock, $0.01 par value per share; 1,000 shares authorized, no shares outstanding
    
-
   
-
 
Common stock, $0.01 par value per share; 100,000 shares authorized, 63,635 shares and 64,959 shares outstanding at March 31, 2004 and December 31, 2004, respectively
    
636
   
650
 
Additional paid-in capital
    
248,495
   
284,750
 
Accumulated other comprehensive income (loss)
    
681
   
(1,738
)
Retained earnings
    
347,629
   
414,269
 
     
597,441
   
697,931
 
 
              
Less: Treasury stock (common: 16,029 and 15,963 shares at March 31, 2004 and December 31, 2004, respectively) at cost
    
(298,138
)
  
(297,746
)
Total stockholders' equity
    
299,303
   
400,185
 
Total liabilities and stockholders' equity
  
$
368,252
  
$
481,695
  
               
 
The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
 
  3  
 
PLANTRONICS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)

                   
   
Three Months Ended
  
Nine Months Ended
  
   
December 31,
  
December 31,
  
   
2003
  
2004
  
2003
  
2004
  
Net sales
 
$
107,622
  
$
150,583
  
$
295,525
  
$
412,173
  
Cost of sales
   
51,381
    
75,150
   
145,051
    
197,572
 
Gross profit
   
56,241
   
75,433
   
150,474
   
214,601
 
                           
Operating expenses:
                          
Research, development and engineering
   
8,834
    
11,989
   
25,686
    
32,871
 
Selling, general and administrative
   
23,649
    
31,642
   
67,786
    
85,867
 
Total operating expenses
   
32,483
   
43,631
   
93,472
   
118,738
 
Operating income
   
23,758
   
31,802
   
57,002
   
95,863
 
Interest and other income, net
   
1,412
   
2,145
   
2,045
   
3,393
 
Income before income taxes
   
25,170
   
33,947
   
59,047
   
99,256
 
Income tax expense
   
7,551
   
9,505
   
17,714
   
27,792
 
Net income
 
$
17,619
  
$
24,442
  
$
41,333
  
$
71,464
  
                           
Basic earnings per common share
 
$
0.39
  
$
0.50
  
$