July 25, 2013 / 9:21 AM / in 4 years

Logitech shares jump after unexpected move into profit

* Q1 sales up 2 pct to $478 mln

* Q1 net profit of $1 mln

* Confirms FY outlook

* Shares up more than 10 pct

ZURICH, July 25 (Reuters) - Computer accessories firm Logitech swung to an unexpected first-quarter net profit, sending its shares over 10 percent higher and suggesting its shift to focus on fast-growing tablet accessories and wireless speakers is paying off.

The firm, which is moving away from traditional computer accessories such as mice and webcams, also confirmed its financial outlook for the year.

Sales rose 2 percent to $478 million in the three months ended June, its fiscal first quarter, Logitech said on Thursday.

It also recorded a net profit of $1 million, instead of the net loss of $12 million expected by analysts in a Reuters poll, after a net loss of $51 million a year ago.

“These results - sales growth and significant year-over-year profitability improvement - demonstrate our turnaround is on track,” President and Chief Executive Bracken P. Darrell said.

He said the company recorded a double-digit percentage rise in sales in the Americas region, while products such as tablet accessories, PC gaming and wireless speakers had grown about 90 percent.

Shares in the group, which have shed more than 11 percent so far this year, were up 10.6 percent by 0905 GMT, outperforming a slightly weaker Swiss market.

The company, which announced its first ever dividend in May, confirmed its outlook of around $2 billion sales, operating income of about $50 million and a gross margin of about 34 percent for the year ending March 2014.

“Logitech’s first-quarter results are again weak in our view, but came in better than feared on stronger tablet accessories, PC gaming and wireless speaker sales,” Helvea analyst Stefan Gaechter said.

Vontobel analyst Michael Foeth said the progress with new products was encouraging, but he was not planning to update his estimates and was keeping a “hold” rating on the stock. (Reporting by Silke Koltrowitz; Editing by Mark Potter)

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