On Jan.18, Swiss computer peripherals and electronics expert Logitech International (NASDAQ:LOGI) released third-quarter 2007 earnings for the period ended Dec. 31, 2006.

  • Logitech is one of a few companies riding the coattails of Apple (NASDAQ:AAPL) and its phenomenally successful iPod entertainment devices. Logitech's audio segment, which sells plenty of iPod accessories, grew sales by 27%.
  • Logitech CEO Guerrino De Luca was proud of his company's cash management in the quarter, and deservedly so -- the cash conversion cycle shortened by more than a week.
  • Try as I might, I can't find anything to complain about here. Sales and margins are up, cash flows and owner earnings are growing faster than net income, inventories are going down, and the balance sheet is stronger than ever. No wonder it's a four-star CAPS stock.

(Figures in millions, except per-share data)

Income Statement Highlights

Q3 2007

Q3 2006

Change

Sales

$658.5

$573.9

14.8%

Net Profit

$94.3

$71.3

32.2%

EPS

$0.49

$0.36

36.1%

Diluted Shares

191.1

200.4

(4.6%)



Get back to basics with a look at the income statement.

Margin Checkup

Q3 2007

Q3 2006

Change*

Gross Margin

36.2%

32.3%

3.9

Operating Margin

15.1%

14.1%

1.1

Net Margin

14.3%

12.4%

1.9

*Expressed in percentage points.

Margins are the earnings engine. See how they work.

Management Effectiveness

Q3 2007

Q3 2006

Change*

Return on Average Assets

29.0%

24.9%

4.2

Return on Average Equity

48.1%

42.2%

5.9

*Expressed in percentage points.

See how management puts its financial tools to work.

Balance Sheet Highlights

Assets

Q3 2007

Q3 2006

Change

Cash + ST Invest.

$368.0

$276.9

32.9%

Accounts Rec.

$416.2

$370.0

12.5%

Inventory

$234.9

$257.6

(8.8%)



Liabilities

Q3 2007

Q3 2006

Change

Accounts Payable

$293.1

$242.6

20.8%

Long-Term Debt

$0.0

$0.0

N/A



Learn the ways of the balance sheet.

Cash Flow Highlights

Q3 2007

Q3 2006

Change

Cash From Ops.

$171.0

$45.3

277.4%

Capital Expenditures

$10.6

$13.5

(21.8%)

Free Cash Flow

$160.4

$31.8

404.9%

Owner Earnings

$95.1

$66.7

42.6%



Find out why Fools always follow the money.

Cash Conversion Checkup

Q3 2007

Q3 2006

Change

Days in Inventory

52.9

60.8

(7.9)

Days in Receivables

55.6

52.3

3.2

Days Payables Outstanding

61.3

56.3

5.0

Cash Conversion Cycle

47.2

56.8

(9.7)



Read up on cash conversion metrics.

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  • Mad Catz Interactive (AMEX:MCZ)
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Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean.

At the time of publication, Anders Bylund had no position in any company mentioned. Fool rules are here.