Logitech’s CEO says large acquisitions are unlikely because the goal is sustainable growth

By John Revill ZURICH (Reuters) – Logitech CEO Bracken Darrell said big acquisitions were unlikely as the maker of gaming keyboards and wireless speakers expects sales growth to slow next year. The Swiss-American company said Tuesday it expects high-single-digit sales growth in the next fiscal year ending in March 2019. That would represent a slowdown from the 12-14% rate Logitech expects in the year to March 2018. “Our long-term business model is for single-digit growth, so it’s not really a change,” Darrell said. “This year we achieved 12-14 percent, last year we grew by 15 percent, the year before by 9 percent. We want to make sure that we deliver sustainable and predictable growth,” he said in an interview with Reuters. Darrell said he’s not aiming low after the company twice raised its earnings and sales guidance for fiscal 2018. For 2019, Logitech aims to increase operating profit by 15 percent to a range of $310 million to $320 million. Since taking over the company in January 2013, Darrell has overseen the turnaround, accelerating new product launches and improving designs. Since the former Procter & Gamble and Whirlpool executive took over, Logitech’s stock price has increased by more than 400 percent. Shares in the Zurich-based company were up about 1 percent by 12:38 GMT. He was particularly confident about the gaming category, where Logitech produces fast keyboards for online gamers playing League Of Legends and other games. “We have more than enough hardware capabilities and we are adding software capabilities,” he said. “We have the global reach to do this, as well as award-winning manufacturing and design capabilities.” Darrell added that the company will consider acquisitions, although large deals are unlikely. “We are looking at everything. We look at hundreds of things every year, most of them are small technological elements. “But I would say that when you get to the really big numbers, the odds ratio drops dramatically because there are so many factors,” he said, “that the company could also benefit from more share buybacks in the future. Logitech is investing about $30 million in a $250 million buyback program launched in March 2017. (Reporting by John Revill; Editing by Michael Shields).