Sales and Operating Income by Product Group
Sales by product group include internal sales and transfer between segments (Electronic Devices and Electronic Components).
We will explain our business performance in the second quarter by comparing it with that of the first quarter.
(1) Audio-Visual and Communication Equipment
<LCD TVs>
Despite the stagnant Japanese market and a slowdown in the Chinese market, sales were up significantly by 39.0% from the first quarter, to 108.0 billion yen, which, on a unit basis, represents 2.23 million sets, up 33.8% from the first quarter.
Considering the business performance in the second quarter, we expect that sales for fiscal 2012 will be down by 36.4% from the previous year, to 370.0 billion yen, and on a unit basis, down by 34.9%, to 8.00 million sets.
<Mobile Phones>
With the supply shortage problem solved and an increasing number of new models being launched, sales of mobile phones were up sharply, at 2.3 times the figure in the first quarter, to 69.0 billion yen. On a unit basis, this represents a 2.5 time increase to 1.95 million units.
For the second half of the fiscal year, we aim to expand the sales of new products that feature our proprietary technologies, such as those equipped with IGZO LCDs.
The forecast for the sales of mobile phones for the fiscal 2012 was revised to 240.0 billion yen, down 21.5%, and unit sales to 6.40 million sets, down 16.9%.
Compared with the first quarter, sales in the Audio-Visual and Communication Equipment for the second quarter were up by 52.4% to 204.4 billion, yen and operating loss improved significantly, from 20.2 billion yen to 0.9 billion yen.
We have revised the previous forecast for this business upward, setting the sales forecast to 710.0 billion yen, down 33.1% from the previous year, and forecasting operating loss of 15.0 billion yen.
(2) Health and Environmental Equipment
While sales of Health and Environmental Equipment remained at 76.7 billion yen, down 2.0% from the first quarter, operating income increased by 10.4% to 9.0 billion yen.
Sales in overseas markets showed a steady increase, up 10% compared with the same period in the previous fiscal year.
We have slightly revised the forecast for fiscal 2012 by taking into account the results in the second quarter. As a result, net sales have been revised to 310.0 billion yen, up 6.1% from the previous year, and operating income is forecast at 33.0 billion yen, up 12.0%.
We intend to further expand business operations and strengthen profitability for the second half and beyond by expanding health and beauty business centered on Plasmacluster Ion technology, reinforcing B2B businesses, and strengthening global operations.
(3) Information Equipment
Sales of information displays and color MFPs were strong, resulting in sales in this product group of 74.4 billion yen in the first quarter, for an increase of 14.9% compared to the first quarter. Operating income rose to 4.6 billion yen, up two-fold from the first quarter.
Based on progress in the second quarter, we forecast the sales for fiscal 2012 to be 290.0 billion yen, an increase of 4.5% compared to the previous year, and operating income to decline by 35.1%, to 18.0 billion yen.
(4) LCDs
In the second quarter, sales increased by 52.2% compared to the first quarter, to 222.0 billion yen. Meanwhile, operating loss improved by 11.4 billion yen to 52.0 billion yen, compared to a loss of 63.4 billion yen in the first quarter.
Sales for small- and medium-size LCDs in the second quarter rose by approximately 60%, and sales for large-size LCDs increased by approximately 40%, both compared to the first quarter.
Operating loss for the second quarter included inventory write-down of 12.0 billion yen.
In small- and medium-size LCDs, we expect a continuing increase in shipments of IGZO LCDs through the second half of the fiscal year. In addition, production is expected to climb at the Kameyama No.1 Plant. As for large-size LCDs, we forecast the utilization rate at the plant to be stable. These factors indicate a sales increase in the second half of approximately 40% over the first half of the fiscal year for LCDs as a whole.
However, sales of small- and medium-size LCDs, aimed mainly at major customers, are not expected to reach original forecasts. Therefore, we revised down the full-year forecast for total LCD business. Sales for LCDs are anticipated to be 880.0 billion yen, an increase of 22.1% compared to the previous year, and operating loss to be 132.0 billion yen.
(5) Solar Cells
Sales of solar cells rose by 21.9% to 51.1 billion yen compared to the first quarter, while operating loss stood at 5.3 billion yen.
Despite strong sales in Japan, prices fell in overseas market due to worsening business conditions and intensifying competition.
For the second half of the fiscal year and onward, we will bolster profitability in this business by implementing structural reforms, such as offering an expanded product lineup to accommodate a solid market in Japan, and strengthening sales of mega-solar power generation projects. The effect of business restructuring, which was implemented in the second quarter, is also expected to contribute to an improvement of profitability.
For fiscal 2012, we forecast sales to be 230.0 billion yen, a 2.7% increase over the previous year, while operating loss will be 14.0 billion yen, reflecting a deteriorating market environment.
(6) Other Electronic Devices
Sales of camera modules for mobile devices were robust, boosting sales for this product group to 78.5 billion yen in the second quarter, a 65.5% increase over the first quarter. Operating loss was 18.7 billion yen, which included inventory write-down of 18.0 billion yen. Disregarding this loss, operating income was almost break-even.
In addition to the business streamlining efforts implemented in the second quarter, including the posting of impairment loss and the liquidation of old products, we will strive to further expand sales of sensor components such as camera modules in the second half of the fiscal year and beyond, to ensure stable profitability.
Sales for fiscal 2012 are projected to increase from the previous year by 13.4% to 270.0 billion yen, while operating loss is anticipated to be 18.0 billion yen.
