1st Half Results for the year ended March 2012 1 2012年3月期第2四半期決算説明会 Contents Ⅰ. 1st half results for the year ended March 2012 Ⅱ. Forecast for the full year ended March 2012 2 Ⅰ. 1st half results for the year ended March 2012 Disclosed on Oct. 20th (Million yen) Net sales 1st half 1st half original revised forecast forecast 1st half result 26,000 25,900 25,948 Operating income 500 1,030 1,077 Income before taxes 400 730 779 Net income 350 800 820 Total comprehensive loss － － ▲ 103 (Main reasons for the variance) ■Net sales --- Slightly below forecast due to strong yen ■Incomes --- Increased by cost reduction of crystal oscillators for smartphones and mobile phone base stations 3 Ⅰ. 1st half results for the year ended March 2012 ■FY2011 1Q: Sales decreased especially with AV/OA products, but profits increased mainly by cost reduction of crystal oscillators for mobile phone base stations ■FY2011 2Q: Sales/profits increased mainly with mobile communication products Ne t sale s Ope r at in g in c o m e / (l o ss) 3 ,0 0 0 1 4 ,0 0 0 2 ,5 0 0 1 2 ,0 0 0 2 ,0 0 0 1 0 ,0 0 0 8 ,0 0 0 1 ,5 0 0 6 ,0 0 0 1 ,0 0 0 4 ,0 0 0 Income (million yen) Net sales (million yen) In c o m e / (lo ss) be fo r e t axe s 1 6 ,0 0 0 500 2 ,0 0 0 0 0 ▲ 2 ,0 0 0 Net sales Operating income/(loss) Income/(loss) before taxes ▲ 500 1Q 13,814 395 287 FY2010 2Q 3Q 14,433 13,744 1,087 689 1,014 590 4Q 12,943 ▲ 77 ▲ 196 FY2011 1Q 2Q 12,125 13,823 321 756 204 575 4 2012年3月期第2四半期決算説明会 Contents Ⅰ. 1st half results for the year ended March 2012 Ⅱ. Forecast for the full year ended March 2012 5 Ⅱ. Forecast for the full year ended March 2012 Production of Crystal Devices (QIAJ) (billion yen) (Monthly average) 25 20 21 15 22 18 17 18 16 17 Lehman Shock 10 Production decreased by 22%, compared to ‘08/3 5 0 '06/3 '07/3 '08/3 '09/3 '10/3 '11/3 '11/9 * SAW and OUT-OUT are not included. (Data source) QIAJ : Quartz Crystal Industry Association of Japan 6 Ⅱ. Forecast for the full year ended March 2012 (mil units) Production Volume & Unit Price of Crystal Products (QIAJ) 1,000 40 901 900 800 600 537 756 754 29.2 670 628 25.7 21.4 20.3 400 300 200 100 874 33.9 32.9 700 500 (yen) 35 30 (Volume) ●Demand in developing countries ●Smartphones ●Increase in data traffic 25 20 19.7 Decreased by 33%, compared to ’08/3 production volume (monthly average) unit price (yen) 0 15 10 Increased by 16%, compared to ’08/3 (Unit price) ●Price decline of digital products 5 0 '06/3 '07/3 '08/3 '09/3 '10/3 '11/3 '11/9 * SAW and OUT-OUT are not included （Data source) QIAJ : Quartz Crystal Industry Association of Japan Exchange rate to the dollar ’08/3 114.13 yen ’11/9 79.73 yen 7 Ⅱ. Forecast for the full year ended March 2012 NDK Sales/Income (’06/3～ ’12/3 forecast） (Unit: 100 million yen) (Net sales) (Income before taxes) 900 80 67 800 700 70 733 60 636 600 500 70 778 594 43 526 549 40 36 400 300 N e t sale s 200 In c ome be f ore taxe s 50 550 17 12 ◆ (Adjusted Income) 30 22 20 10 0 100 -10 ▲243 0 ▲200 -20 re su lt re su lt re su lt re su lt re su lt re su lt f ore c ast ’06/3 ’07/3 ’08/3 ’09/3 ’10/3 ’11/3 '1 2 / 3 '1 3 / 3 '1 4 / 3 ■Volume Zone ⇒ Launch New Products ■ High Precision Devices Markets ⇒ Smartphones and Mobile phone base stations 8 Ⅱ. Forecast for the full year ended March 2012 Volume Zone ＡＶ Game Note PC USB Lower Price Expected Volume Growth Replace existing products Develop market and expand sales Improve cost Increase volume NDK will continuously launch New Products Develop new products with different materials and engineering methods from the conventional products 9 Ⅱ. Forecast for the full year ended March 2012 Small SMD type crystal units NX3225HA Size 3.2(L)×2.5(W)×0.8(H)mm NX2016HA Size ｻｲｽﾞ 2.0(L)×1.6(W)×0.7(H)mm - Available within range between ceramic resonators (wide deviation) and conventional crystal units (narrow deviation) - Outstanding cost performance - Ideal for HDD,SSD,USB, Blu-ray, and etc. 10 Ⅱ. Forecast for the full year ended March 2012 High Precision Devices Markets ① NDK will respond to growing demand for Smartphones This year NDK has started supplying to large smartphone makers ⇒ Sales expansion to them Growing demand of crystal devices for GPS, Wireless LAN and various applications for Smartphones Respond with products of high value, such as TＣＸＯs Improve ASP 11 Ⅱ. Forecast for the full year ended March 2012 ■ Wireless LAN function loaded in mobile phones and portable devices (Data source) IHS iSuppli 1.2 billion units in 2011 2.2 billion units in 2015 < Required functions with Wireless LAN > ●Less data error ●Stable high capacity data transmission NT2016SA Developed ultra small 2016-size low noise TCXO Size: 2.0(L)×1.6(W)×0.8(H)mm 12 Ⅱ. Forecast for the full year ended March 2012 High Precision Devices Markets ② Growing demand for Mobile phone base stations and Optical communication devices Smartphones ＝ × 24 times Tablets ＝ × 122 times （Data Source）Cisco VNI From 2010 to 2015 Data traffic volume 26 times 13 Ⅱ. Forecast for the full year ended March 2012 NDK will respond to growing demand for mobile phone base stations and optical communication devices High-value-added ＯＣＸＯ,ＴＣＸＯ andＶＣＸＯ < Frequency stability range of common oscillators > 10 - 6 1ppm Crystal 水晶発振器 Oscillators 10 - 7 10 - 8 0.1ppm 0.01ppm 10 - 9 1ppb 10 - 1 0 10 - 1 1 0.1ppb 0.01ppb TCXO OCXO Rubidium Atomic Oscillators ルビジウム原子発振器 Propose the most appropriate products beyond this range High Precision, Energy Saving, High Frequency 14 Ⅱ. Forecast for the full year ended March 2012 High Precision Developed OCXO with the stability that surpasses the ±1ppb level Super-high-precision Oscillators are required for LTE(3.9G) and next generation LTE-Advance(4G) base stations NH37M28LC Size: 37(L)×28(W)×19(H) mm < Frequency stability range > 10 - 6 1ppm TCXO Crystal 水晶発振器 Oscillators 10 - 7 10 - 8 0.1ppm 0.01ppm 10 - 9 1ppb 10 - 1 0 10 - 1 1 0.1ppb 0.01ppb Realize frequency stability beyond conventional crystal range OCXO Rubidium Atomic Oscillators ルビジウム原子発振器 Realize incomparable High Precision Devices 15 Ⅱ. Forecast for the full year ended March 2012 Energy Saving NT7050BB Developed TCXO for Femtocell Base Stations Demands for small base stations are increasing due to increasing smartphones Size: 7,0(L)×5.0(W)×2.0(H) mm < Frequency stability range > 10 - 6 1ppm 10 - 7 10 - 8 0.1ppm 0.01ppm 10 - 9 1ppb 10 - 1 0 10 - 1 1 0.1ppb 0.01ppb TCXO Crystal 水晶発振器 Oscillators OCXO Rubidium Atomic Oscillators ルビジウム原子発振器 Realize the stability of OCXO with TCXO ⇒Current consumption: 1/50, Rise time: 8ms from 5 minutes 16 Ⅱ. Forecast for the full year ended March 2012 High Frequency VCXOs are developed to respond to needs of higher frequency required as a result of increase in data transmission rate in optical communication Increased data communication traffic accelerates data transmission rate in communication network backbone < Data transmission rate in optical communication > 10Gbps (bits per second) 10-fold increase 100Gbps 100Gbps can transmit 2 hours full high definition video (5 DVDs) in 2 seconds ! VCXO with high frequency (1.9GHz) 17 Ⅱ. Forecast for the full year ended March 2012 High Precision Devices Markets ③ NDK will raise its market share for GPS used in automotive < Crystal devices used in automotive > Power Steering Required to be equipped in new cars from 2015 in Europe. e-Call Remote Keyless Entry Stolen Vehicle Tracking System Widely spread as a main devices of telematics Applications of GPS Navigation System Obstacle Sensor Engine Control TPMS ABS Required to be equipped in new cars from Dec. 2011 in Brazil Air Bag CCD Camera Car Audio GPS plays a greater role in cars 18 Ⅱ. Forecast for the full year ended March 2012 Environment Resistance Small Size, High Precision and Wide Temperature Range NT2520SB size ※Enabled NDK products to be installed in locations 2.5(L)×2.0(W)×0.8(H)mm with much severe temperature conditions than before -40 to +105deg.C ±3.0ppm (conventional products were around ±10ppm) High Reliability: High resistance to solder cracking Electrical characteristic: ±3.0ppm (-40 to +105deg.C) New package for TCXO used in Automotive GPS Structures/Materials: Seam sealing, 6 terminals, Pb free 19 Ⅱ. Forecast for the full year ended March 2012 Received “Supplier Award” from BOSCH NDK was awarded by making stable supply of high quality products to BOSCH (July 2011) NDK products are used in ABSs, Air Bags, GPS in Car Navigation Systems, and Car Audio Systems of Bosch 20 Ⅱ. Forecast for the full year ended March 2012 ¥5.1 billion capital investment expected for full year ended March 2012 Due to decrease in crystal devices demands, additional investment for existing products became unnecessary (Revised original plan of ¥ 9.9 billion) (Million yen) 3,000 FY2011 1st half result Operating cash① Investing cash② Free cash flow①-② Financing cash 2,000 750 1,000 0 ▲ 87 ▲ 1,000 ▲ 717 ▲ 1,467 ▲ 2,000 Depreciation and amortisation ¥1,476 million Cash at end of year ¥12,229 million ▲ 3,000 ¥2.5 billion R&D expenses expected for full year ended March 2012 as originally planned (Million yen) R&D expenses R&D expenses ratio against sales 3,000 2,500 2,000 1,500 2,241 4.3% 2,420 4.4% 2,500 4.5% 6% 5% 4% 3% 1,000 2% 500 1% 0 0% ’10/3 actual ’11/3 actual ’12/3 forecast 21 Ⅱ. Forecast for the full year ended March 2012 ■Forecast for the full year left unchanged due to following Uncertain Factors Net sales (million yen) Ne t sal e s In c o m e be fo r e t axe s 35,000 Ope r at i n g i n c o m e Ne t i n c o m e 3,000 30,000 2,500 25,000 2,000 20,000 1,500 15,000 1,000 10,000 500 5,000 0 0 ’11/3 actual (Million yen) Net sales Operating income Income before taxes Net income Income (million yen) - World economy & Currency trend - Aftermath of Thailand floods Uncertain Factors 1H 2H 28,247 1,482 1,301 1,316 26,687 612 394 422 1H actual 25,948 1,077 779 820 ’12/3 2H forecast 29,052 1,423 1,421 1,180 Annual forecast 55,000 2,500 2,200 2,000 NDK has no production facilities and sales bases in Thailand Expected exchange rate for the 2nd half of FY2011 (US$)：¥80 (FY2011 1st half result average ： ¥79.73) Influence on Net Sales (2nd half of FY2011) ¥1 fluctuation⇒ approx.¥100 mil Influence on Operating Profit (2nd half of FY2011) ¥1 fluctuation⇒ approx.¥30 mil 22 Ⅱ. Forecast for the full year ended March 2012 2013 Achieve Sustainable Growth 2012 Progress toward Sustainable Growth ■ “Volume Zone” ⇒Introduce New Products ■ “Professional Market” ⇒Introduce incomparable High-Precision Devices 2011 2010 Strengthened NDK Foundation Accumulated Technological Strength (crystal + digital technology ) 23 Thank you for your attention. We are grateful for your continuous support. 【Note】 Statements made in this presentation with respect to our current plans, estimates, strategies and beliefs and other statements that are not historical facts are forward-looking statements about our future performance. These statements are based on management’s assumptions and beliefs in light of information currently available to it. We caution that a number of important risks and uncertainties could cause actual results to differ materially from those discussed in the forward-looking statements, and therefore you should not place undue reliance on them. You also should not rely on the belief that it is our obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Risks and uncertainties that might affect us include, but are not limited to; fluctuation of currency exchange rates, overall supply and customer demand in the industry, product development and production capacities, performance of affiliated companies, and other risks and uncertainties. 24