Results for the Three Months Ended December 31, 2013
Financial Results | (Billions of Yen) |
| |
FY2012 |
FY2013 |
| |
1Q to 3Q
Accumu-
lated
Total |
|
1Q to 3Q
Accumu-
lated
Total |
|
| 3Q |
1Q |
2Q |
3Q |
|
Change
(Q on Q) |
Difference
(Q on Q) |
Change
(Y on Y) |
Change
(Y on Y) |
| Net Sales |
678.2 |
1,782.4 |
607.9 |
734.1 |
815.2 |
+11.1% |
+81.1 |
+20.2% |
2,157.2 |
+21.0% |
Operating
Income(margin) |
2.6 (0.4%) |
-166.2 (-9.3%) |
3.0 (0.5%) |
30.8 (4.2%) |
47.6 (5.8%) |
+54.7%
|
+16.8
|
17.9-fold
|
81.4 (3.8%) |
-
|
| Net Income (margin) |
-36.7 (-5.4%) |
-424.3 (-23.8%) |
-17.9 (-3.0%) |
13.6 (1.9%) |
22.0 (2.7%) |
+61.6%
|
+8.4
|
-
|
17.7 (0.8%) |
-
|
Consolidated financial results for the third quarter (October to December 2013) recorded net sales of 815.2 billion yen, up 11.1% over the previous quarter and up 20.2% over the same period last year.
Operating income was 47.6 billion yen, a significant increase of 54.7% over the previous quarter and up 17.9 fold over the same period last year. This increase was due partly to earnings from engineering business activities in the LCD business, such as patent operations. The operating margin increased from 4.2% in the second quarter to 5.8% in the third quarter.
Net income was 22.0 billion yen, a substantial increase over the previous quarter and the same period last year.
For the first three quarters (April to December 2013), net sales were 2,157.2 billion yen, up 21.0% over the same period last year, operating income was 81.4 billion yen, and net income was 17.7 billion yen. This is a drastic improvement over the same period last year, and we returned to the black.
Sales by Product Group | (Billions of Yen) |
*Sales of each product group include internal sales between segments (Product Business / Device Business)
| |
FY2012 |
FY2013 |
| 3Q |
1Q |
2Q |
3Q |
|
Change
(Q on Q) |
Difference
(Q on Q) |
Change
(Y on Y) |
| |
Digital Information
Equipment |
202.3 |
158.9 |
175.6 |
216.9 |
+23.5% |
+41.3 |
+7.2% |
| Health and Environmental
Equipment |
74.8 |
82.3 |
77.5 |
82.1 |
+5.8% |
+4.5 |
+9.7% |
| Solar Cells |
55.9 |
84.3 |
83.9 |
108.5 |
+29.4% |
+24.6 |
+94.1% |
| Business Solutions |
69.6 |
77.6 |
80.7 |
77.1 |
-4.5% |
-3.6 |
+10.7% |
| Product Business |
402.8 |
403.3 |
417.9 |
484.7 |
+16.0% |
+66.8 |
+20.3% |
| |
LCDs |
258.2 |
193.8 |
284.7 |
277.5 |
-2.5% |
-7.2 |
+7.5% |
| Electronic Devices |
82.2 |
61.2 |
86.5 |
106.4 |
+23.0% |
+19.8 |
+29.5% |
| Device Business |
340.4 |
255.0 |
371.3 |
384.0 |
+3.4% |
+12.6 |
+12.8% |
| Sub Total |
743.3 |
658.3 |
789.2 |
868.7 |
+10.1% |
+79.5 |
+16.9% |
| Adjustments |
-65.0 |
-50.4 |
-55.1 |
-53.4 |
- |
+1.6 |
- |
| Total |
678.2 |
607.9 |
734.1 |
815.2 |
+11.1% |
+81.1 |
+20.2% |
Operating Income by Product Group | (Billions of Yen) |
*The percentage figures noted in brackets show operating margin
| |
FY2012 |
FY2013 |
| 3Q |
1Q |
2Q |
3Q |
|
Change
(Q on Q) |
Difference
(Q on Q) |
Change
(Y on Y) |
| |
Digital Information
Equipment |
5.3 (2.6%) |
-1.3 (-0.9%) |
2.2 (1.3%) |
8.4 (3.9%) |
3.8-fold
|
+6.2
|
+59.4%
|
| Health and Environmental
Equipment |
7.4 (10.0%) |
6.4 (7.8%) |
3.2 (4.2%) |
5.6 (6.9%) |
+75.4%
|
+2.4
|
-23.9%
|
| Solar Cells |
-1.9 (-3.4%) |
6.8 (8.1%) |
3.0 (3.7%) |
5.9 (5.5%) |
+93.7%
|
+2.8
|
-
|
| Business Solutions |
6.3 (9.1%) |
7.5 (9.8%) |
8.3 (10.3%) |
6.1 (8.0%) |
-26.3%
|
-2.1
|
-3.0%
|
| Product Business |
17.2 (4.3%) |
19.4 (4.8%) |
16.8 (4.0%) |
26.2 (5.4%) |
+55.7%
|
+9.4
|
+52.5%
|
| |
LCDs |
-11.7 (-4.6%) |
-9.5 (-4.9%) |
18.1 (6.4%) |
26.0 (9.4%) |
+43.1%
|
+7.8
|
-
|
| Electronic Devices |
3.1 (3.9%) |
0.1 (0.2%) |
5.1 (5.9%) |
4.2 (4.0%) |
-18.0%
|
-0.9
|
+32.5%
|
| Device Business |
-8.5 (-2.5%) |
-9.3 (-3.7%) |
23.3 (6.3%) |
30.2 (7.9%) |
+29.6%
|
+6.9
|
-
|
| Sub Total |
8.6 (1.2%) |
10.0 (1.5%) |
40.1 (5.1%) |
56.4 (6.5%) |
+40.6%
|
+16.3
|
6.5-fold
|
| Adjustments |
-5.9 |
-7.0 |
-9.3 |
-8.8 |
- |
+0.5 |
- |
| Total |
2.6 (0.4%) |
3.0 (0.5%) |
30.8 (4.2%) |
47.6 (5.8%) |
+54.7%
|
+16.8
|
17.9-fold
|
Overall sales growth for the third quarter was 81.1 billion yen over the previous quarter, with significant growth in Digital Information Equipment, Solar Cells, and Electronic Devices.
As for operating income, all product groups were in the black following the second quarter. Overall, operating income increased by 16.8 billion yen over the previous quarter.
Other Income (Expenses)
In the third quarter, other income (expenses) improved by 19.8 billion yen compared to the same period last year. While interest expense increased, restructuring charges were eliminated.
Income taxes, etc. increased by 6.0 billion yen.
Breakdown of Operating Income by Factors
Looking at a breakdown of operating income by key contributing factors, with a comparison between the first three quarters of fiscal 2012 and 2013, the improvement in operating income was due to the effects of business restructuring, which include a 97.6 billion yen reduction of fixed costs, and a 68.9 billion yen reduction of assets such as inventories and noncurrent assets. It was also due to a 81.1 billion yen effect mainly from revenue increase in each product group.
Implementation State of Measures to Reinforce Business Foundations
Regarding the measure to reduce fixed costs by reformation of cost structure, we reduced fixed costs by 97.6 billion yen compared to the first three quarters of fiscal 2012. We achieved this through a reduction in depreciation and amortization, and a reduction in labor costs.
Regarding capital reinforcement measures, with the goal of securing strategic investment funds and strengthening our financial foundations to achieve the targets of our Medium-Term Management Plan, we increased a total of 120.3 billion yen capital in October and November 2013, through a public offering and through third-party allotment in relation to the secondary offering due to over-allotment. We also increased a total of 17.4 billion yen capital in October 2013, through third-party allotments to DENSO CORPORATION, Makita Corporation, and LIXIL Corporation.
Consolidated Balance Sheets
At the end of December 2013, cash, time deposits and restricted cash increased by 150.9 billion yen over the end of September 2013, following a capital increase through a public offering and third-party allotments in October and November 2013. Accordingly, the net asset balance came to 326.8 billion yen and the equity ratio improved from 6.4% at the end of September 2013 to 13.1%.
“Asset Light” Approach
Inventory at the end of December 2013 was 342.1 billion yen. This was an increase of 24.5 billion yen compared to the end of September 2013, as a result of sales increase. The ratio vs. monthly sales was relatively flat, at 1.43 months.
Transition of Interest-bearing Debt
Interest-bearing debt at the end of December 2013 was 1,219.8 billion yen, an increase of 24.5 billion yen compared to the end of September 2013. The ratio vs. monthly sales decreased to 5.09 months. Net interest-bearing debt, which is interest-bearing debt minus cash, time deposits and restricted cash, improved from the 1 trillion yen level to the 900 billion yen level.
We will strive for a further reduction of the interest-bearing debt by improving cash flows.