Presentation

Financial Results for
Fiscal Year Ended March 31, 2011
May 10, 2011
NEC Corporation
(http://www.nec.co.jp/ir/en)
Index
I. Financial Results for FY11/3
II. Management Policy for FY12/3
III. Measures for Mid-term Growth Plan V2012
l
Financial Results for FY11/3 (Appendix)
l
Financial Forecasts for FY12/3 (Appendix)
l
Mid-term Growth Plan “V2012” Progress
l
Reference (Financial data)
Page 2
© NEC Corporation 2011
Impact of the Great East Japan Earthquake
▐ All quake-stricken manufacturing facilities* restarted on 23rd Mar
l Expanding production and securing supply systems
Just after the earthquake
NEC Network Products
Restart on 14th Mar
(former NEC Wireless Networks)
《Fukushima, Fukushima Pref.》
Assembly/inspection line
Assembly/inspection line
On 14th Mar
NEC Network Products
Restart on 23rd Mar
(former NEC Tohoku)
《Ichinoseki, Iwate Pref.》
Production line
Production line
* NEC Network Products (Headquarters, Ichinoseki Plant), NEC Infrontia Tohoku, NEC Tokin
Page 3
© NEC Corporation 2011
I. Financial Results for FY11/3
Summary of Financial Results for FY11/3
FY11/3 Results
▐ Operating profit was in line with the previous forecasts
▐ However, net loss was recorded due to larger investment loss from the equity
method
(Billions of Yen)
FY10/3
Actual
Net Sales
Operating Income
% to Net Sales
Ordinary Income
% to Net Sales
Net Income/Loss
% to Net Sales
FY11/3
Actual
3,583.1
3,115.4
-13.1%
-84.6
50.9
57.8
6.9
-2.2
1.4%
1.9%
49.4
0.0
-49.4
-10.0
1.4%
0.0%
-23.9
-12.5
-4.82
11.4
-12.5
0.3%
-
Net Income/Loss per
Share (Yen)
5.04
-4.82
-9.86
Free Cash Flow
93.6
-112.6
-206.2
Note: Average exchange rates for FY11/3: 1$= ¥86.45, 1€= ¥113.83
Page 5
YoY
Difference from
February 25
Forecasts
© NEC Corporation 2011
FY11/3 Results
Results for FY11/3 by Segment
Net Sales
Operating Income/Loss
-6.2
50.9
51.8
53.2
4,215.6
IT Services
IT Services
933.8
3,583.1
3,115.4
Platform
Carrier
Network
Social
Infrastructure
469.4
866.3
807.0
373.7
340.4
Personal
Solutions
848.4
Others
816.7
FY09/3
Page 6
804.2
627.4
375.8
316.6
605.4
737.7
318.8
766.5
661.4
FY10/3
244.7
FY11/3
Platform
11.5
Carrier
Network
51.6
21.7
Social
Infrastructure
Personal
Solutions
7.9
-14.2
18.9
-1.7
-44.9
Others
-87.1
-27.5
Eliminations/
Unclassifiable
expenses
-27.7
FY09/3
© NEC Corporation 2011
31.3
FY10/3
(Billions of Yen)
57.8
21.4
8.9
40.7
14.6
7.3
-1.9
-33.2
FY11/3
FY11/3 Results
Sales Change (Year on Year)
Decrease in Wireless Overseas
mainly in mobile backhaul areas
-25.8
FY10/3
IT Services
-62.1 (-7.2%)
3,583.1
-13.5
-34.6
Carrier Network
-22.0 (-3.5%)
Personal Solutions
+28.8 (+3.9%)
Synergy effects from merger of
mobile terminal businesses,
solid growth in display business
Delayed recovery in domestic IT
investments, decrease in large
scale projects
Platform
+2.1(+0.6%)
+0.8
Decrease in hardware,
solid growth in software
Social Infrastructure
+2.2 (+0.7%)
+3.8
Decrease in Aerospace and Defense,
increase in social systems
Page 7
© NEC Corporation 2011
Deconsolidation of
semiconductor business
FY11/3
3,115.4
Others
-416.6
-15.3
Difference from Feb. 25
Forecasts
(Billions of Yen)
FY11/3 Results
Operating Income Change (Year on Year)
Eliminations/
Unclassifiable
expense
-5.6
High profit project in the
previous fiscal year
Improved profit from sales
recovery in 2H
FY10/3
50.9
IT Services
-31.8
-8.6
Decrease in sales,
severe price competition,
loss-making projects
Carrier
Network
Social
+9.4
Infrastructure
-7.1
+0.7
+1.6
(Billions of Yen)
FY11/3
57.8
+3.8
Others
+52.2
+1.3
Deconsolidation of
semiconductor business
Continuous cost reduction
efforts, improved
development efficiency
+0.9
Page 8
Platform
+10.6
Personal
Solutions
-20.8
-1.9
© NEC Corporation 2011
Difference from Feb. 25
Forecasts
Sluggish sales of feature phones, increase in
R&D for new devices
Key Points of FY11/3 Results by Segment (Year on Year)
IT Services
l Delayed recovery in domestic IT investments, decrease in large scale projects
l Lower profits due to decrease in sales, severe price competition, loss-making
projects
✔
Platform
l Increase in sales due to solid growth in software, despite decrease in hardware
l Higher profits from continuous cost reduction efforts and improved development
efficiency
Carrier
Network
l Decrease in sales due to decrease in wireless overseas, mainly in mobile
backhaul areas
l Higher profits from sales recovery in 2H (WBA*, submarine cable systems)
Social
Infrastructure
Personal
Solutions
Others
*
FY11/3 Results
l Flat sales due to increase in social systems, offset by a decrease in aerospace and
defense
l Lower profit compared with the previous fiscal year with high profit projects
l Increase in sales due to synergy effects from merger of mobile terminal business
and solid growth for display
l Stagnant sales of feature phones and larger R&D for new devices
✔
l Decrease in sales due to deconsolidation of semiconductor business
l Higher profits from deconsolidation of loss making semiconductor business
WBS: Wireless Broadband Access, including LTE and femtocell
Page 9
✔
Note: First bullets in the tables refer to changes in sales, second bullets refer to changes in profits
© NEC Corporation 2011
FY11/3 Results
Net Income/Loss Change (Year on Year)
(Billions of Yen)
FY10/3
11.4
Improvement in
operating income
+6.9
-2.2
Larger investment loss from the equity
method,
Reversal of provision for contingent
loss from the previous fiscal year
Larger nonoperating loss
-56.3
FY11/3
-7.8
Others
+52.2
Platform
+10.6
Carrier Network
+9.4
Eliminations/Unclassifiable
expense
-5.6
Social Infrastructure
-7.1
Personal Solutions
-20.8
IT Services
-31.8
-2.5
Others
+25.6
Decrease in tax payments
Difference from Feb. 25
Forecasts
Page 10
-12.5
© NEC Corporation 2011
Challenges and Accomplishments
FY11/3 Results
▐ Challenging performance with downward revisions on yearstart forecasts, net loss and passed dividends
l Slower than estimated recovery in domestic IT investments, lower
profitability in IT services
l Stagnant investments among global telecom carriers
l Sluggish sales of feature phones, and slow entry to smartphones
▐ Measures to reinforce business competitiveness
l Announcement of strategic alliance with Lenovo Group in PC
business
▐ Challenges to tackle V2012 focus areas, “Implementation of
C&C Cloud Services”, “Expansion of Global Businesses” and
“Creation of New Businesses”, with speed
Page 11
© NEC Corporation 2011
II. Management Policy for FY12/3
FY12/3 Forecasts
Management Policy for FY12/3
▐ Creating and gaining new business opportunities to expand global
businesses
l Provide total solutions, leveraging NEC’s strengths in cloud services
l Accelerate global business expansion through collaboration with partners in
emerging countries
l Create new businesses which will follow batteries and new devices
▐ Improving quality and enhancing cost efficiency to maximize profits
l Implement cost reduction measures and control quality related expenses
l Slash selling and general administrative expenses by enhancing back-office
efficiency
One NEC to promote “outward” and “inward” efforts, and realize
operating profit target* of 90B yen, and net profit target* of 15B yen
through operation with speed
*Forecasts as of May 10, 2011
Page 13
© NEC Corporation 2011
Summary of Financial Forecast for FY12/3
FY12/3 Forecasts
(Billions of Yen)
Net Sales
Operating Income
% to Net Sales
Ordinary Income
% to Net Sales
Net Income/Loss
FY11/3
FY12/3
Actual
Forecast(*)
3,115.4
3,300.0
5.9%
57.8
90.0
32.2
1.9%
2.7%
0.0
Free Cash Flow
55.0
0.0%
-12.5
% to Net Sales
Net Income/Loss per Share(yen)
YoY
1.7%
15.0
-
55.0
27.5
0.5%
-4.82
5.77
10.59
-112.6
0.0
112.6
Note: Assumed exchange rates for FY12/3 1$=¥80, 1€=¥110
*Forecasts as of May 10, 2011
Page 14
© NEC Corporation 2011
Financial Forecasts for FY12/3 by Segment
Net Sales
FY12/3 Forecasts
Operating Income/Loss
(Billions of Yen)
3,583.1
IT Services
Platform
Carrier
Network
Social
Infrastructure
Personal
Solutions
Others
3,115.4
90.0
3,300.0
50.9
866.3
373.7
627.4
316.6
737.7
661.4
FY10/3
804.2
375.8
605.4
318.8
810.0
IT
Services
400.0
760.0
325.0
53.2
Carrier
Network
31.3
Social
Infrastructure
21.7
Personal
Solutions
18.9
-1.7
Platform
766.5
765.0
Others
244.7
240.0
FY11/3
FY12/3
Forecast
Eliminations/
Unclassifiable
expenses
-44.9
57.8
21.4
8.9
40.7
14.6
7.3 -1.9
-33.2
33.0
14.0
57.0
15.0
15.0
6.0
-50.0
-27.5
FY10/3
FY11/3
FY12/3
Forecast
*Forecasts as of May 10, 2011
Page 15
© NEC Corporation 2011
FY12/3 Forecasts
Sales Change (Year on Year)
(Billions of Yen)
Deconsolidation of consumer PCs,
increase in smartphones
Increase in sales from wireless
broadband access, submarine
cable systems, mobile
backhaul, and network
software
Carrier Network
+154.6 (+25.5%)
Increase in sales from cloud
related business such as data
center services, and energy
saving
FY11/3
3,115.4
Personal Solutions
-1.5 (-0.2%)
Others
-4.7
FY12/3
Forecast
3,300.0
Social Infrastructure
+6.2 (+1.9 %)
Platform
+24.2 (+6.4%)
Strong demand in social
systems, mainly in broadcasting,
and fire and disaster preventions
IT Services
+5.8 (+0.7%)
Expand new solutions for cloud services,
exploit global markets
*Forecasts as of May 10, 2011
Page 16
© NEC Corporation 2011
Operating Income Change (Year on Year)
(Billions of Yen)
Improvement in profitability for
mobile terminals
Increase in sales,
lower costs
Higher profits from sales
increase due to improved
break even point
Others
-1.3
Personal Solutions
+16.9
FY12/3
Forecast
Social Infrastructure
+0.4
Carrier Network
+16.3
90.0
Eliminations/
Unclassifiable
expense -16.8
FY11/3
57.8
FY12/3 Forecasts
Platform
+5.1
IT Services
+11.6
Increase in sales and
continuous cost reduction efforts
Control loss-making projects,
enhance production and quality
*Forecasts as of May 10, 2011
Page 17
© NEC Corporation 2011
Key Points of FY12/3 Outlook by Segment (Year on Year)
IT Services
l Reinforce new cloud solutions, sales expansion in global businesses
l Improve profits by controlling loss-making projects and enhancing production and
quality
Platform
l Increase in sales from cloud related business such as datacenter services, and
energy saving
l Higher profits from sales increase and continuous cost reduction efforts
Carrier
Network
l Increase in sales from WBA*, submarine cable systems, mobile backhaul and
network software
l Higher profits from sales increase due to improved break even point
Social
Infrastructure
*
FY12/3 Forecasts
l Increase in sales for social systems including broadcasting, and fire and disaster
preventions
l Higher sales from sales increase and lower costs
Personal
Solution
l Flat sales from increase in smartphones, offset by deconsolidation of consumer PC
business
l Higher profits from improved profitability for mobile terminals
Others
l Decrease in sales from deconsolidation of LCD module business, despite expansion
of battery business
l Lower profits from sales decrease
WBS: Wireless Broadband Access, including LTE and femtocell
Page 18
Note: First bullets in the tables refer to changes in sales, second bullets refer to changes in profits
© NEC Corporation 2011
FY12/3 Forecasts
IT Services Business
(Billions of Yen)
YoY
FY12/3 Key Measures
▐ Expand Sales
l Expansion of cloud services
Sales
- Core systems by industry
- Create new services by collaborating with
customers
- Provide one stop solution for mid to small
businesses
810.0
l Proposal for Disaster Recovery solutions
804.2
- Review BCP, Datacenter services, Telework,
Sharing-type business services, wide-range
cooperation between local governments and
medical services, Review Global SCM
+0.7%
Operating
Income
l Development of global businesses
33.0
21.4
- Expand competitive solutions in 5 regions
(Public Safety, Healthcare, Signage, POS etc)
- Support Japanese company with IFRS and
enhancing group governance
▐ Improve Profitability
FY11/3
*Forecasts as of May 10, 2011
Page 19
FY12/3
Forecast
l Control loss-making projects
l Enhance SI innovation and service delivery
(utilizing SW factory)
© NEC Corporation 2011
FY12/3 Forecasts
Carrier Network Business
(Billions of Yen)
FY12/3 Key Measures
YoY
▐ Sales expansion of new products
released in FY11/3 and solid execution
of projects already in hand
l LTE, iPASOLINK, Femtocell
760.0
Sales
605.4
l Submarine cable system projects
+25.5%
Operating
Income
57.0
40.7
▐ Winning end-to-end business
opportunities from data traffic expansion
l Wireless broadband access, mobile backhaul,
network software, submarine cable systems
▐ Creation and early launch of new
businesses
l M2M, smartphone solutions, energy
l Cloud services for telecom carriers
FY11/3
FY12/3
Forecast
M2M: Machine to machine
*Forecasts as of May 10, 2011
Page 20
© NEC Corporation 2011
FY12/3 Forecasts
Personal Solutions Business
(Billions of Yen)
FY12/3 Key Measures
YoY
▐ Business expansion
l Business expansion of smartphones
Sales
766.5
Mobile
Terminals
765.0
+29.2%
303.5
392.0
Operating
Income/loss
PC and
Others
- Stronger and competitive product lines with
thin and toughness technology, cost
competitiveness with global model
development, business development of
smartphone business in Japan and overseas
by regionalization approach
-0.2%
463.0
-1.9
FY11/3
l Starting up of tablet device business
-19.4%
373.0
15.0
- Provide competitive tablet devices coupled
with services
▐ Improve profitability
l Increase overall sales
FY12/3
Forecast
l Reduce costs and streamline development in
mobile terminals
*Forecasts as of May 10, 2011
Page 21
© NEC Corporation 2011
FY12/3 Forecasts
Net Income/Loss Change (Year on Year)
(Billions of Yen)
Personal Solutions
+16.9
Carrier Network
+16.3
IT Services
+11.6
Platform
+5.1
Social Infrastructure
+0.4
Others
-1.3
Eliminations/unclassifiable
expense
-16.8
Improvement in
non-operating
income/loss
+22.8
Narrower investment loss
from the equity method
Increase in tax payments
Others
-27.5
Improvement in
operating income
+32.2
FY12/3
Forecast
15.0
FY11/3
-12.5
*Forecasts as of May 10, 2011
Page 22
© NEC Corporation 2011
III. Measures for Mid-term Growth Plan
V2012
FY12/3 Business Environment
▐ Smartphone boom
l Traffic upsurge
Mobile terminals
Carrier Network
l High value added services/spread of corresponding applications
▐ Explosive increase of data processing
in cloud computing due to digitalized information
Platform
l Stronger needs for “collecting”, “processing”, and “visualization” of information
l Creation of new businesses across industry sectors by using analyzed data
▐ Realize “Any place, Any time”, “Real time” cloud services via cloud
devices, connecting people and material goods in cloud computing
IT Services
Page 24
Personal Solutions
© NEC Corporation 2011
Social Infrastructure
Further Development in Cloud Services
▐ Deliver “Mobile Cloud Services” with RFID and “Cloud Work Style” with
cloud services, connected everywhere via Cloud Devices
Mobile Cloud Services
customer
trait AP
Attendance
management
AP
Support
management
AP
C&C Cloud Work Style
SFA
・・・
Cloud
Desktop
data
Printing
data
Cloud for business
operations
Cloud
Desktop
service
ID Management Server
Cloud
Printing
service
Cloud Devices
RFID tags
ID
RFID mobile phones
Page 25
+
Employee ID card
© NEC Corporation 2011
******
Password
ID
+
Employee ID card
******
Password
Development of new devices and vertical integration business
▐
Offer tablet devices to support various needs by enhancing NEC’s
unique “Only One” products and all-purpose products
l Business status * : Approximately 200 cases under negotiation,
focusing on five areas
7 inch 1display
(For 3G/LTE)
Market
e-books
/Newspaper
Education
Electric
Power/Houses
Distribution
/Retail
Living support
7 inch keyboard
Industry
7 inch 2 display
Proposed solutions and services
Publishing/Printing/Book
store/Carrier
E-books/Newspaper service
Learning, Coaching school,
school
E-learning
Power, energy/houses, housing
HEMS/Home electronics/Home security
Mail order/Department
store/Supermarket
Net-shopping/Coupon/Catalog
Medical/Health/Local
governments/CATV
Photo frame/Remote monitoring/Healthcare/Remote
medical care
*As of May 10, 2011
Page 26
© NEC Corporation 2011
Expansion of smartphones by using NEC’s strengths
▐ Expand global business leveraging NEC’s own thin and light technology
and toughness technology from CHMC
Expand Channel by
merger effect with CHMC
NEC’s Strength
NTT Docomo
Thin and light technology
KDDI
Based on feature phone business
Softbank Mobile
Toughness technology
Verizon Wireless
By merger effect with CHMC
Other global carriers
(Waterproof, Dust-proof, Toughness)
(North America、Europe)
Steps to expand global businesses
First step (-FY2012)
Second step (FY2012-)
Enter global market with competitive differentiated products
(slimness, toughness, and waterproofed)
Expand business in the global market with volume
CHMC:Casio Hitachi Mobile Communications
Page 27
© NEC Corporation 2011
Accelerating efforts with One NEC formation in 5 regions
▐ Established new regional headquarters for Latin America in Brazil
on April 2011
Speedy business operations
Clarification of responsibility and authority
l Competence center
for Femtocell in
London
EMEA
Aggregate customer needs in each region
and provide solutions from Japan
North
America
Greater
China
l Competence center
for Carrier Cloud in
Spain
Competence Center
APAC
l Expand business
knowhow from the
competence center
to each region
l NEC Biometrics
Excellence Center l Competence center
in Bangalore, India
for public safety solutions
in Singapore
Page 28
l Competence center for public
safety solutions in Argentina
© NEC Corporation 2011
Latin
America
l NEC Latin America in Sao
NEW
Paulo, Brazil.
The world of “C&C Cloud”
Services for
Carriers
Services for
Consumers
Services for
Enterprises
Services for
Governments
Digitization of all information
Data
Data
Data
Data
Data
IT Platform/Network
Sensors/Devices
Sensors/Devices
Mobile Cloud Services
through various terminals and devices
An information society friendly to humans and the earth
Page 29
© NEC Corporation 2011
Summary of FY12/3 Objectives
▐ Noting that FY12/3 results will affect the outcome of V2012
mid-term growth plan,
operate with speed and intensity
▐ Challenge to create and gain
new business opportunities toward
global business expansion
▐ Reinforce business structure to maximize profits
To achieve and overcome FY12/3 targets*
(Operating profit target 90B yen, net profit target 15B yen)
*Forecasts as of May 10, 2011
Page 30
© NEC Corporation 2011
Efforts to Accelerate Post-quake Reconstruction
▐ NEC Group is aspired to carry out actions
“To realize an information society friendly to humans and the earth”
Disaster Recovery PJ
Energy Recovery PJ
Support continuance of businesses
through NEC’s IT platforms,
network, solutions including sensors
and devices, and cloud services
Contribute to energy saving
measures through NEC’s battery,
energy management, and knowhow
of energy saving products
NEC Group is dedicated to realize a “safe and secure”, “energy-efficient”
society, by working with our customers, through ICT technology and C&C
cloud.
Page 31
© NEC Corporation 2011
Page 32
© NEC Corporation 2011
© NEC Corporation 2011
Financial Results for FY11/3 (Appendix)
FY11/3 Results
Summary of Financial Results for FY11/3
(Billions of Yen)
Q4(January to March)
FY10/3
FY11/3
Actual
Actual
Full Year
YoY
FY10/3
FY11/3
Actual
Actual
YoY
1,104.1
925.5
- 16.2%
3,583.1
3,115.4
- 13.1%
-84.6
Operating Income
96.1
70.2
-25.9
50.9
57.8
6.9
-2.2
% to Net Sales
8.7%
7.6%
1.4%
1.9%
105.7
49.3
49.4
0.0
-49.4
-10.0
% to Net Sales
9.6%
5.3%
1.4%
0.0%
Net Income/Loss
64.6
41.1
-23.9
-12.5
% to Net Sales
5.9%
4.4%
-4.82
Net Sales
Ordinary Income
-56.5
-23.6
Free Cash Flow
168.5
81.9
11.4
-12.5
0.3%
Net Income/Loss per Share(yen)
-86.6
-
5.04
-4.82
-9.86
93.6
-112.6
-206.2
(Ref): Average exchange rate for Q4(Jan-Mar) of FY11/3 1$= ¥82.88, 1€= ¥111.13
Average exchange rate for full year of FY11/3 1$= ¥86.45, 1€= ¥113.83
(Assumed exchange rate for Q4 of FY11/3 1$=¥80, 1€=¥110)
Page 34
Difference
from
Feb 25
© NEC Corporation 2011
FY11/3 Results
Results for FY11/3 by Segment
(Billions of Yen)
Net Sales
IT Services
Operating Income
% to Net Sales
Net Sales
Platform
Operating Income/Loss
% to Net Sales
Carrier
Network
Social
Infrastructure
Personal
Solutions
Net Sales
Operating Income
% to Net Sales
Net Sales
Operating Income
% to Net Sales
Net Sales
Operating Income/Loss
% to Net Sales
Net Sales
Others
Operating Income/Loss
% to Net Sales
Eliminations/
Unclass ifiable expenses
Operating Income/Loss
Net Sales
Total
Operating Income
% to Net Sales
Page 35
Q4(January to March)
FY10/3
FY11/3
YoY
Actual
Actual
301.5
262.2
- 13.0%
40.2
24.5
-15.7
13.3%
120.6
12.1
9.3%
116.5
12.4
10.0%
175.9
16.9
9.6%
122.2
18.4
15.1%
3.6%
0.9
1,104.1
96.1
7.3%
11.0
627.4
31.3
316.6
21.7
- 8.7%
-10.4
737.7
18.9
- 66.3%
2.6
661.4
-44.9
7.6%
© NEC Corporation 2011
1.4%
0.8
0.9
- 3.5%
9.4
-34.6
0.7
0.7%
-7.1
3.8
1.6
3.9%
-20.8
-13.5
-1.9
- 63.0%
52.2
-15.3
1.3
-5.6
- 13.1%
6.9
3.8
-84.6
-2.2
-
244.7
7.3
-27.5
3,583.1
50.9
0.6%
10.6
4.6%
2.6%
-5.4
- 16.2%
-25.9
-25.8
-8.6
6.7%
766.5
-1.9
-
- 7.2%
-31.8
2.4%
318.8
14.6
6.9%
Difference
from
Feb 25
2.7%
605.4
40.7
5.0%
- 6.4%
-8.3
YoY
375.8
8.9
-
4.7%
-4.5
925.5
70.2
8.7%
373.7
-1.7
-
62.3
2.9
0.2%
- 3.4%
0.4
8.8%
181.5
-3.2
185.2
0.4
6.1%
14.8%
114.3
10.1
198.7
7.2
FY10/3
Actual
866.3
53.2
10.7%
188.7
27.9
Full Year
FY11/3
Actual
804.2
21.4
3.0%
-33.2
3,115.4
57.8
1.9%
FY11/3 Results
Sales Proportion By Segment
Others
8%
Personal
Solutions
25%
Social Infrastructure
10%
Page 36
IT Services
26%
Sales for
FY11/3
¥3,115.4 Billion
Platform
12%
Carrier Network
19%
© NEC Corporation 2011
FY11/3 Results
IT Services Business
(Billions of Yen)
Q4
Operating margin
ratio
Full Year
Operating margin
ratio
5.6%
13.3%
YoY
6.1%
12.3%
Sales
9.3%
Sales
326.8
2.7%
933.8
866.3
804.2
301.5
262.2
Operating
Income
40.2
Operating
Income
-7.7%
40.2
51.8
-13.0%
-7.2%
53.2
24.5
Page 37
FY09/3
FY10/3
FY11/3
<Jan-Mar>
<Jan-Mar>
<Jan-Mar>
© NEC Corporation 2011
-7.2%
21.4
FY09/3
FY10/3
FY11/3
FY11/3 Results
IT Services Business
(YoY)
▐ Sales
804.2 (-7.2%)
(Billions of Yen)
s SI Services :
Decrease due to delay in the recovery of IT investments in Japan
and decrease in large-scale overseas projects, despite making
efforts to propose solutions to expand customers’ sales and
solve business challenges
w Outsourcing/ Support Services :
Stable sales by expanding SaaS menu and the cloud services
business
▐ Operating Income 21.4 (-31.8)
s Decline due to sales decrease, an increase in investment
for expanding service/global businesses and loss-making projects
Page 38
© NEC Corporation 2011
FY11/3 Results
Platform Business
(Billions of Yen)
Q4
Operating margin
ratio
Full Year
10.0%
Operating margin
ratio
10.7%
4.2%
2.4%
- 0.5%
Sales
375.8
373.7
120.6
116.5
-8.5%
Operating
Income
Operating
Income/Loss -20.4%
12.1
+0.6%
11.5
-3.4%
8.9
12.4
5.6
Page 39
2.4%
Sales
469.4
131.8
YoY
-1.7
FY09/3
FY10/3
FY11/3
<Jan-Mar>
<Jan-Mar>
<Jan-Mar>
© NEC Corporation 2011
FY09/3
FY10/3
FY11/3
FY11/3 Results
Platform Business
▐ Sales
(YoY)
375.8 (+0.6%)
(Billions of Yen)
r Software :
Increase in system integration through virtualization, and cloud computing
platform for enterprise, government and datacenter
s Hardware :
Decline due to downward trend in system renewal cycles,
despite an increase in UNIX servers and IA servers
w Enterprise Network :
Remain flat from the previous year by focusing on areas
where customers invest aggressively (e.g. cost savings solutions) and
accomplishment of large scale projects, despite exchange rate fluctuations
▐ Operating Income
8.9 (+10.6)
r Turn a profit due to continual cost reduction efforts and
improvement of development efficiency
Page 40
© NEC Corporation 2011
FY11/3 Results
Carrier Network Business
(Billions of Yen)
Q4
Full Year
14.8%
Operating Margin Ratio
Operating Margin Ratio
8.8%
6.7%
6.4%
9.6%
Sales
5.0%
807.0
Sales
232.6
Operating
Income
20.4
627.4
188.7
175.9
Page 41
YoY
51.6
+7.3%
-24.4%
605.4
Operating
Income
-22.3%
-3.5%
40.7
27.9
31.3
16.9
FY09/3
FY10/3
FY11/3
<Jan-Mar>
<Jan-Mar>
<Jan-Mar>
© NEC Corporation 2011
FY09/3
FY10/3
FY11/3
FY11/3 Results
Carrier Network Business
(YoY)
▐ Sales
605.4 (-3.5%)
(Billions of Yen)
r Increase in sales in Japan, due to CATV projects with supplementary budgets
and sales expansion in wireless broadband access businesses for LTE and
Femtocell
s Delay of some submarine cable system projects in hand to next term
s Decrease in sales due to exchange rate fluctuations and slower recovery in
markets, despite introduction of new full-IP PASOLINK products
▐ Operating Income
40.7 (+9.4)
r Sales and profits turned upward in 2H, leading
to increase in overall sales and profits for the full year
Page 42
© NEC Corporation 2011
FY11/3 Results
Social Infrastructure Business
Q4
Full Year
(Billions of Yen)
YoY
6.9%
15.1%
Operating Margin Ratio
Operating Margin Ratio
8.8%
2.3%
4.6%
5.5%
Sales
Sales
340.4
124.7
122.2
316.6
318.8
-7.0%
+0.7%
114.3
-2.0%
21.7
-6.4%
18.4
Operating
Income
10.1
6.9
Page 43
FY09/3
FY10/3
FY11/3
<Jan-Mar>
<Jan-Mar>
<Jan-Mar>
© NEC Corporation 2011
Operating
Income
14.6
7.9
FY09/3
FY10/3
FY11/3
FY11/3 Results
Social Infrastructure Business
(YoY)
▐ Sales
318.8 (+0.7%)
(Billions of Yen)
r Remain flat from the previous year due to an increase
in social systems such as transportation and fire prevention
offset by a decrease in aerospace and defense
systems
▐ Operating Income
14.6 (-7.1)
s Decrease from the previous year, where there were high profit
projects, and an increase in initial costs for strengthening framework
despite enhancing cost reduction activities such as project
management
Page 44
© NEC Corporation 2011
FY11/3 Results
Personal Solutions Business
Q4
Full Year
(Billions of Yen)
YoY
2.6%
3.6%
Operating Margin Ratio
Operating Margin Ratio
-1.7%
- 1.8%
-4.1%
-0.2%
Sales
Sales
+4.6%
198.7
189.9
66.1
75.1
Operating
Income/Loss
PC and
Others
Page 45
114.8
-7.8
+2.6%
Mobile
348.1
Terminals
-18.8%
+7.4%
303.5
282.5
67.8
+15.5%
132.6
766.5
737.7
181.5
-12.0%
Mobile
Terminals
848.4
-8.7%
+3.9%
-13.0%
7.2
Operating
Income/Loss
PC and
500.3
Others
-14.3%
113.7
-3.2
FY09/3
FY10/3
FY11/3
<Jan-Mar>
<Jan-Mar>
<Jan-Mar>
© NEC Corporation 2011
+1.7%
-9.0%
455.2
18.9
-1.9
-14.2
FY09/3
463.0
FY10/3
FY11/3
FY11/3 Results
Personal Solutions Business
▐ Sales
766.5
(YoY)
(Billions of Yen)
(+3.9%)
r Mobile Terminals :
Increase due to synergy effects from business integration, despite
sluggish sales of feature phones
r PC and Others :
Increase from overseas business, such as public displays and digital
cinema projectors, despite lower sales from price declines in PCs
▐ Operating Loss
-1.9
(-20.8)
s Decrease due to higher development costs for
smartphones and new devices, in addition to
sluggish sales of feature phones
Page 46
© NEC Corporation 2011
FY11/3 Results
Others
(Billions of Yen)
Q4
Operating margin
ratio
Full Year
0.2%
4.7%
Operating margin
ratio
YoY
3.0%
-10.7%
-6.8%
Sales
816.7
-48.8%
661.4
185.2
Sales
133.6
+38.6%
62.3
Operating
Income/Loss
-65.2
Page 47
-19.0%
-66.3%
0.4
-63.0%
244.7
Operating
Income/Loss
2.9
FY09/3
FY10/3
FY11/3
<Jan-Mar>
<Jan-Mar>
<Jan-Mar>
© NEC Corporation 2011
-87.1
FY09/3
-44.9
FY10/3
7.3
FY11/3
FY11/3 Results
Others
▐ Sales
(YoY)
244.7 (-63.0%)
s Decrease due to deconsolidation of
NEC Electronics (current Renesas Electronics)
▐ Operating Income
7.3 (+52.2)
r Improve due to deconsolidation of NEC Electronics
(current Renesas Electronics) which recorded operating loss
in the previous year
Page 48
© NEC Corporation 2011
(Billions of Yen)
FY11/3 Results
<Ref.> Financial Positions
(Billions of Yen)
End of Mar End of Mar
2010
2011
2,937.6
2,628.9
-308.7
Net Assets
931.9
875.4
-56.5
Interest-bearing debt
729.5
675.8
-53.8
Shareholder's Equity
790.9
757.1
-33.9
Total Assets
Equity ratio(%)
26.9%
28.8%
1.9pt
D/E ratio
0.92
0.89
0.03pt
Net D/E ratio
0.50
0.62
- 0.12pt
330.5
203.9
Balance of cash and cash
equivalents
Page 49
Difference
from Mar
2010
© NEC Corporation 2011
-126.7
<Ref.> Capital Expenditures and Others
(Billions of Yen)
FY10/3
FY11/3
Actual
Actual
YoY
Difference
from
Feb 25
FY12/3
Forecast
YoY
83.1
52.9
- 36.4%
-22.2
80.0
51.4%
Depreciation
111.2
62.1
- 44.2%
-12.9
65.0
4.7%
R&D expenses
276.0
176.5
- 36.0%
-23.5
185.0
4.8%
Capial Expenditure
(Billions of Yen)
FY10/3
FY11/3
Q4 Actual Q4 Actual
R&D expenses
68.5
39.8
YoY
-41.9%
*Forecasts as of May 10, 2011
Page 50
© NEC Corporation 2011
FY11/3 Results
<Ref.> Overseas sales
(Billions of Yen)
Q4(January to March)
FY10/3
FY11/3
YoY
Actual
Actual
Asia
Europe
Others
Total
Net Sales
84.3
38.9
To consolidated total sales (%)
7.6%
4.2%
Net Sales
41.7
29.7
To consolidated total sales (%)
3.8%
3.2%
Net Sales
60.9
50.2
To consolidated total sales (%)
5.5%
5.4%
186.8
118.8
16.9%
12.8%
Net Sales
To consolidated total sales (%)
FY10/3
Actual
- 53.8%
- 28.8%
- 17.5%
- 36.4%
Japan
Full Year
FY11/3
Actual
321.8
158.5
9.0%
5.1%
164.7
109.8
4.6%
3.5%
226.4
211.1
6.3%
6.8%
712.9
479.3
19.9%
15.4%
FY11/3 Sales
¥3,115.4 Billion
Major countries and regions
YoY
- 50.8%
- 33.3%
- 6.8%
China,Chinese Taipei,India,
Singapore and Indonesia
UK,France,Netherlands,
Germ any,Italy and Spain
U.S.A
- 32.8%
Asia
Overseas Sales
¥ 479.3 Billion
Europe
Others
Overseas Sales Ratio
15.4%
* Sales, based on customer locations, are classified by country or region
Page 51
© NEC Corporation 2011
Financial Forecasts for FY12/3 (Appendix)
FY12/3 Forecasts
Summary of Financial Forecasts for FY12/3 by Segment
(Billions of Yen)
Net Sales
IT Services
Operating Income
Full Year
FY11/3
FY12/3
Actual
Forecast(*)
804.2
810.0
21.4
33.0
% to Net Sales
Net Sales
Platform
Operating Income
% to Net Sales
Carrier
Network
Social
Infrastructure
Personal
Solutions
Net Sales
Operating Income
% to Net Sales
Net Sales
Operating Income
% to Net Sales
Net Sales
Operating Income/Loss
Operating Income
% to Net Sales
Eliminations/
Unclas sifiable expenses
Operating Loss
Net Sales
Total
4.1%
375.8
8.9
400.0
14.0
2.4%
3.5%
605.4
40.7
760.0
57.0
6.7%
7.5%
318.8
14.6
325.0
15.0
4.6%
4.6%
766.5
-1.9
765.0
15.0
-
2.0%
244.7
7.3
240.0
6.0
3.0%
2.5%
% to Net Sales
Net Sales
Others
2.7%
Operating Income
% to Net Sales
YoY
0.7%
11.6
6.4%
5.1
25.5%
16.3
1.9%
0.4
- 0.2%
16.9
- 1.9%
-1.3
-33.2
-50.0
-16.8
3,115.4
57.8
3,300.0
90.0
5.9%
32.2
1.9%
2.7%
*Forecasts as of May 10, 2011
Page 53
© NEC Corporation 2011
FY12/3 Forecasts
Sales Proportion Forecast By Segment
Others
7%
Personal
Solutions
23%
Social Infrastructure
10%
IT Services
25%
Sales forecast
for FY12/3
¥3,300.0 Billion
Platform
12%
Carrier Network
23%
*Forecasts as of May 10, 2011
Page 54
© NEC Corporation 2011
FY12/3 Forecasts
IT Services Business
(Billions of Yen)
YoY
Operating margin
ratio
4.1%
2.7%
Sales
810.0
804.2
Operating
Income
810.0
(+0.7%)
sOutlook for IT investments in
Japan is unclear
6.1%
866.3
▐ Sales
+0.7%
-7.2%
rAim to increase with disaster
recovery solutions and global
business, in addition to proposals
to expand customers’ sales and
raise business efficiency
53.2
33.0
21.4
FY10/3
FY11/3
FY12/3
Forecast
▐ Operating Income
33.0 (+11.6)
rAim to increase profit by
controlling loss-making projects,
and enhancing SI innovation and
service delivery
*Forecasts as of May 10, 2011
Page 55
© NEC Corporation 2011
FY12/3 Forecasts
Platform Business
(Billions of Yen)
YoY
Operating margin
ratio
2.4%
3.5%
- 0.5%
Sales
400.0
375.8
373.7
+6.4%
+0.6%
14.0
8.9
Operating
Income/Loss
▐ Sales
400.0
(+6.4%)
r Software :
Expect to increase sales in server
integration, virtualization and cloud
computing platform by focusing on
continual demands on datacenter
r Hardware :
Aim to increase sales by focusing on
the products which meet the needs
for datacenters and energy saving
r Enterprise Network :
Aim to increase sales by deploying
office solutions worldwide, which
contribute to energy saving and
innovative work styles for customers
-1.7
▐ Operating Income 14.0
FY10/3
FY11/3
FY12/3
Forecast
(+5.1)
r Expect to improve through sales
increase and continual cost reductions
*Forecasts as of May 10, 2011
Page 56
© NEC Corporation 2011
FY12/3 Forecasts
Carrier Network Business
(Billions of Yen)
YoY
Operating Margin Ratio
6.7%
7.5%
5.0%
627.4
605.4
+25.5%
57.0
-3.5%
Operating
Income
760.0
(+25.5%)
r Focus on wireless broadband access,
network software, and new businesses
in energy related areas in Japan
r Aim to increase by submarine cable
systems through solid execution of
large scale projects in hand
760.0
Sales
▐ Sales
40.7
r Aim to expand sales in India, Latin
America, Middle East, Russia with new
full-IP PASOLINK products
31.3
▐ Operating Income 57.0
FY10/3
FY11/3
FY12/3
Forecast
(+16.3)
r Anticipate higher profits from an
increase in sales in Japan, and sales
recovery of submarine cable systems
and PASOLINK
*Forecasts as of May 10, 2011
Page 57
© NEC Corporation 2011
FY12/3 Forecasts
Social Infrastructure Business
(Billions of Yen)
YoY
Operating Margin Ratio
6.9%
4.6%
Sales
325.0
318.8
316.6
Operating
Income
4.6%
325.0
(+1.9%)
r Expect to increase due to an increase
in social systems such as broadcast,
fire and disaster preventions,
despite a decrease in aerospace and
defense systems
+1.9%
+0.7%
21.7
▐ Operating Income 15.0
14.6
FY10/3
▐ Sales
FY11/3
15.0
(+0.4)
r Expect higher profits due to sales
increase and cost reductions
FY12/3
Forecast
*Forecasts as of May 10, 2011
Page 58
© NEC Corporation 2011
FY12/3 Forecasts
Personal Solutions Business
(Billions of Yen)
YoY
Operating Margin Ratio
2.6%
2.0%
▐ Sales
Sales
737.7
-0.2%
766.5
765.0
Expect to increase by launching fullscale smartphone business in Japan
and overseas
sPC and Others :
+7.4%
Expect decrease due to the
deconsolidation of consumer PCs
+29.2%
Mobile
303.5
282.5
Terminals
Operating
(-0.2%)
rMobile Terminals :
-0.2%
+3.9%
765.0
392.0
Income/Loss
+1.7%
PC and
Others
455.2
18.9
-19.4%
463.0
-1.9
FY10/3
FY11/3
373.0
15.0
FY12/3
Forecast
▐ Operating Income 15.0
(+16.9)
r Expect higher profits due to sales
increase in mobile terminals from shift
to smartphones, and improvements in
cost performance from slashing fixed
costs, expenses and enhanced R&D
efficiency.
*Forecasts as of May 10, 2011
Page 59
© NEC Corporation 2011
FY12/3 Forecasts
Others
(Billions of Yen)
YoY
3.0%
Operating margin
ratio
2.5%
-6.8%
▐ Sales
240.0
(-1.9%)
s Decrease from deconsolidation of NEC
LCD Technologies
r Expand business of Lithium-ion
rechargeable batteries for automotive
application
Sales
661.4
-1.9%
244.7
240.0
Operating
Income/Loss
-44.9
FY10/3
▐ Operating Income 6.0 (-1.3)
-63.0%
7.3
FY11/3
s Expect a slight decline due to a
decrease in sales
6.0
FY12/3
Forecast
*Forecasts as of May 10, 2011
Page 60
© NEC Corporation 2011
Mid-term Growth Plan “V2012” Progress
Progress in Focus Areas
Focus Areas
Main Accomplishments and Efforts in FY11/3
Cloud
Japan
l Core business operations in focus domains, new businesses with
customers, rich service menu for mid to small businesses/organizations,
establish and introduce preceding business track records
l Provide total solution for LTE services
Global
l Reinforce operation framework for global business expansion
Global
l Establish new regional headquarters for Latin America
l Set up competence centers in key business
Batteries
l Launch mass production of lithium-ion rechargeable
batteries for automotives
New
Businesses l Participation in various field trials for smartgrid
Devices
l Launch smartphones and tablet devices
Page 62
© NEC Corporation 2011
Cloud
Cloud Business Activities / Achievements
Financial accounting cloud service for 10 cities, Yamanashi Pref.
l
l
l
Ticketless service for Shiki Theatre Company
l
Integrated hotel cloud service for Nippon View Hotel
l
CRM Cloud for Sugi Holdings NEW
Core system on cloud service for 7 cities, Nara Pref. NEW
Government,
Public, Medical
Retail
Service
l
Core system on cloud service for 3 cities Kasuya,
Fukuoka Pref.
l
Education cloud for Sennan-city, Osaka Pref.
l
Collaboration with Sanyo on a regional medical
care solution
l
SaaS-based electric medical records system for
NEW
Tamashima Daiichi Hospital in Kurashiki-city,
Okayama Pref.
l Collaboration with Sumitomo Life
Insurance Company on cloud service
Finance
l
Manufacturing
/ Equipment
l
l
l
NEW
Cloud oriented accounting service for Exedy
Integrated Construction companies Cooperation
on Core infrastructure services
Cooperation with Sumitomo Forestry, SaaS for the
housing industry
Telecom
/ Media
l
Private cloud for
Sumitomo Mitsui Banking
Collaboration with Telefonica on cloud
business in Latin America
l
Collaboration with South Korea’s Shinsegae
Group in digital signage
Contributions to NTT DOCOMO’s LTEbased mobile phone service, "Xi™"
Participation in KDDI’s field trial of LTE
l
Collaboration with KDDI on mobile cloud service
© NEC Corporation 2011
NEW
l
l
(Added after Q2 of FY11/3 financial announcement)
Page 63
NEW
NEW
NEW
NEW
Global Business Activities / Achievements
l Collaboration with Neusoft for Cloud services
l Mail Processing
Systems
for Norway Post
l Medical solutions for Hospital in Chongqing
l RFID Temperature Traceability System for Jointown
Pharmaceutical Group
l POS system for the Guangzhou Baiyun International Airport
CFCR in Netherlands
l
Global
l IP Telephony system for InterContinental Hotels & Resorts Shanghai
EXPO
l IP based telephone and IPTV system solutions for Mandarin Oriental,
l Transmitter for digital
Macau
broadcasting in Bulgaria lCollaborate on LTE infrastructure business
l Collaboration with SomaLogic in
with WRI of China
aptamer related business
NEW
l SaaS services for
Telefonica
l
Visa information systems
Fingerprint identification
system for Ministry of
Foreign Affairs of Greece
NEW
l
Global information system for Shiseido
l
Collaboration with SAP on cloud service NEW
l Collaboration with Intel and
Microsoft in digital signage
NEW
NEW
l Cloud Computing Based
Education System for
l Asia Submarine-cable Express (ASE) NEW
Argentina‘s San Juan
l South-East Asia Japan Cable (SJC) system NEW
Province Ministry of
l Success in LTE field trial with Singapore Telecom Education
l
CFCR: Culler Facer Cancelling and Revenue protection system
NEW
Page 64
(Added after Q2 of FY11/3 financial announcement)
© NEC Corporation 2011
Medical equipments
location management of
system for Albert Einstein
Hospital
new business
New Business Activities (Battery, Smart Grid)
NEW
Heat, Hydro,
Nuclear Power
(Added after Q2 of FY11/3 financial announcement)
Commercial Bldg,
Apartment
Factory,
Bldg
Data center
Distribution,
Substation
Activities in EV
Housing,
Stores
<EV Infrastructure>
Commercial Facilities
(convenience stores, gas stations, etc)
Renewable
Energy
Renewable
Energy
Rapid chargers
l
Activities in
ICT
Start field trial of transfer
blocking system for distributed
power with Chugoku Electric
Power
l
l
l
Form a business partnership with NEW
SEKISUI CHEMICAL CO.,LTD
in the field of Smart House
Promote Membership-based Charging NEW
Service for EV
Start EV car sharing field trial with
driving information
l Rapid charge trials in the
United States (Oregon)
l Rapid charge trials
with ENEOS and others
NEW
l
Activities in
Power
Storage
Page 65
l
Works with Electric Power
Research Institute (EPRI)
to test large-scale electricity
storage system using NEC’s
Lithium-ion rechargeable battery
l
Joint development of a Building Energy
Management Systems using lithium-ion
rechargeable batteries with Meidensha
Electric vehicles
l
Agreed to Co-operate with
Enel Distribuzione on NextGeneration Smart Grid and
Smart Cities
NEW
© NEC Corporation 2011
Electrodes for automotive
lithium-ion rechargeable
batteries are in mass production
Reference (Financial data)
Net Sales, Operating Income/Loss
(Billions of yen)
8.7%
Operating margin ratio
7.6%
3.0%
0.3%
- 0.9%
- 5.1%
Net Sales
-22.3%
1,104.1
-22.3%
-8.4%
186.8
875.2
(16.9%)
825.4
186.9
-14.2%
(21.2%)
(Overseas Sales Ratio) (21.1%)
117.5
(16.3%)
(17.1%)
70.2
24.3
2.3
-7.5
-13.5
-23.2
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
<Apr-Jun>
<Jul-Sep>
<Oct-Dec>
<Jan-Mar>
<Apr-Jun>
<Jul-Sep>
<Oct-Dec>
<Jan-Mar>
FY10/3
Page 67
118.8
(12.8%)
128.8
(16.1%)
Operating
Income/
Loss
-40.0
925.5
720.7
114.2
96.1
Domestic Sales
-12.7%
801.6
667.5
175.2
(21.4%)
163.9
-16.2%
-13.0%
778.5
Overseas Sales
- 1.9%
- 3.5%
-3.1%
FY11/3
© NEC Corporation 2011
YoY
Sales, Operating Income/Loss (IT Services)
(Billions of yen)
13.3%
Operating margin ratio
9.3%
4.8%
4.4%
1.8%
- 0.4%
301.5
- 3.5%
Sales
-7.7%
209.8
209.7
-10.8%
40.2
-1.4%
-7.7%
171.0
161.2
-0.0%
-8.8%
-3.8%
Operating
Income/
Loss
10.2
24.5
9.2
3.4
-0.6
262.2
-13.0%
187.6
167.6
-6.6
-5.7
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
<Apr-Jun>
<Jul-Sep>
<Oct-Dec>
<Jan-Mar>
<Apr-Jun>
<Jul-Sep>
<Oct-Dec>
<Jan-Mar>
FY10/3
Page 68
- 3.9%
FY11/3
© NEC Corporation 2011
YoY
Sales, Operating Income/Loss (Platform)
10.0%
Operating margin ratio
10.7%
YoY
3.0%
0.7%
- 0.3%
- 2.4%
- 5.5%
120.6
116.5
- 19.1%
92.3
Sales
96.7
-8.5%
87.0
+4.8%
-21.0%
-19.8%
-5.1%
+8.3%
-34.1%
Operating
Income/
Loss
-14.1
12.4
12.1
0.7
-0.3
-4.4
2.9
-2.0
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
<Apr-Jun>
<Jul-Sep>
<Oct-Dec>
<Jan-Mar>
<Apr-Jun>
<Jul-Sep>
<Oct-Dec>
<Jan-Mar>
FY10/3
Page 69
-3.4%
82.5
80.0
73.9
FY11/3
© NEC Corporation 2011
(Billions of yen)
Sales, Operating Income/Loss (Carrier Network)
(Billions of yen)
14.8%
Operating margin ratio
YoY
9.6%
8.4%
7.1%
4.0%
1.4%
0.4%
175.9
166.9
Sales
154.2
142.9
141.7
188.7
- 5.1%
-25.9%
116.8
-17.1%
145.7
+7.3%
-24.4%
-7.6%
+2.0%
-19.8%
27.9
-17.6%
Operating
Income/
Loss
16.9
11.8
2.0
0.5
13.0
-6.0
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
<Apr-Jun>
<Jul-Sep>
<Oct-Dec>
<Jan-Mar>
<Apr-Jun>
<Jul-Sep>
<Oct-Dec>
<Jan-Mar>
FY10/3
Page 70
5.8
FY11/3
© NEC Corporation 2011
Sales, Operating Income/Loss (Social Infrastructure)
(Billions of yen)
15.1%
Operating margin ratio
YoY
8.8%
4.7%
4.6%
0.9%
- 1.2%
122.2
0.6%
0.7%
114.3
-2.0%
Sales
72.4
64.7
57.2
18.4
-18.1%
66.6
58.4
+9.7%
+3.0%
-4.1%
-4.3%
Operating
Income/
Loss
+2.0%
10.1
3.7
3.4
0.6
-0.7
0.4
0.3
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
<Apr-Jun>
<Jul-Sep>
<Oct-Dec>
<Jan-Mar>
<Apr-Jun>
<Jul-Sep>
<Oct-Dec>
<Jan-Mar>
FY10/3
Page 71
-6.4%
79.5
FY11/3
© NEC Corporation 2011
Sales, Operating Income/Loss (Personal Solutions)
(Billions of yen)
Operating margin ratio
YoY
4.6%
2.0%
3.6%
- 0.2%
- 0.4%
1.6%
- 0.8%
- 1.8%
Sales
+4.6%
-17.1%
194.9
-13.4%
-23.6%
PC and
Others
198.7
198.5
193.5
66.1
93.2
63.9
-8.7%
193.0
76.3
79.1
59.3
181.5
80.3
67.8
Operating
Income/
Loss
101.7
8.9
117.4
103.5
132.6
7.2
3.4
-0.7
122.3
114.4
3.3
113.7
112.7
-1.6
-0.4
-3.2
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
<Apr-Jun>
<Jul-Sep>
<Oct-Dec>
<Jan-Mar>
<Apr-Jun>
<Jul-Sep>
<Oct-Dec>
<Jan-Mar>
FY10/3
Page 72
+9.2%
176.7
167.4
Mobile
Terminals
+18.6%
-0.7%
FY11/3
© NEC Corporation 2011
Sales, Operating Income/Loss (Others)
(Billions of yen)
6.6%
Operating margin ratio
0.2%
YoY
2.1%
- 7.8%
- 2.0%
- 4.6%
- 17.2%
Sales
185.2
166.5
166.5
143.1
+38.6%
-31.2%
-16.7%
-62.2%
-40.7%
-59.8%
-24.7
63.0
57.6
Operating
Income/
Loss
-7.7
-12.9
0.4
-1.1
-62.8%
-66.3%
61.9
62.3
4.2
1.3
2.9
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
<Apr-Jun>
<Jul-Sep>
<Oct-Dec>
<Jan-Mar>
<Apr-Jun>
<Jul-Sep>
<Oct-Dec>
<Jan-Mar>
FY10/3
Page 73
4.7%
FY11/3
© NEC Corporation 2011
Exchange Rate
(Yen)
130
Euro/Yen Exchange rate(Actual)
125
Assumed Exchange rate
120
115
110
Average exchange rate ¥113.83
105
100
100
Dollar/Yen Exchange rate(Actual)
Assumed Exchange rate
95
90
Average exchange rate ¥86.45
85
80
75
4/1
Page 74
6/30
9/30
© NEC Corporation 2011
12/30
3/31
Stock Price
(Yen)
Apr 28:Revision of Financial Forecast
12,000
320
NEC
May 12:FY10/3 Earnings
11,500
Jun 22:Shareholder Meeting
11,000
the Nikkei Stock Average
300
Oct 13:NEC IR Day (IT Services)
280
Jul 28:Q1 of the FY11/3 Earnings
10,500
260
10,000
240
9,500
220
Jul 1:Investors Meeting (R&D)
9,000
Jul 8:NEC IR Day (Carrier Network)
8,500
200
Jan 27:Q3 of the FY11/3 Earnings
Feb 9:NEC IR Day (Platform)
180
Oct 28:Q2 of the FY11/3 Earnings
Feb 25:Revision of Financial Forecasts
8,000
160
4/1
Page 75
5/12
6/22
7/28
10/28
© NEC Corporation 2011
12/30
1/27
2/25
3/31
CAUTIONARY STATEMENTS:
This material contains forward-looking statements pertaining to strategies, financial targets, technology, products and services,
and business performance of NEC Corporation and its consolidated subsidiaries (collectively "NEC"). Written forward-looking
statements may appear in other documents that NEC files with stock exchanges or regulatory authorities, such as the Director
of the Kanto Finance Bureau, and in reports to shareholders and other communications. NEC is relying on certain safeharbors for forward-looking statements in making these disclosures. Some of the forward-looking statements can be identified
by the use of forward-looking words such as "believes," "expects," "may," "will," "should," "seeks," "intends," "plans,"
"estimates," "targets," "aims," or "anticipates," or the negative of those words, or other comparable words or phrases. You can
also identify forward-looking statements by discussions of strategy, beliefs, plans, targets, or intentions. Forward-looking
statements necessarily depend on currently available assumptions, data, or methods that may be incorrect or imprecise and
NEC may not be able to realize the results expected by them. You should not place undue reliance on forward-looking
statements, which reflect NEC’s analysis and expectations only. Forward-looking statements are not guarantees of future
performance and involve inherent risks and uncertainties. A number of important factors could cause actual results to differ
materially from those in the forward-looking statements. Among the factors that could cause actual results to differ materially
from such statements include (i) global economic conditions and general economic conditions in NEC’s markets, (ii)
fluctuating demand for, and competitive pricing pressure on, NEC’s products and services, (iii) NEC’s ability to continue to
win acceptance of NEC’s products and services in highly competitive markets, (iv) NEC’s ability to expand into foreign
markets, such as China, (v) regulatory change and uncertainty and potential legal liability relating to NEC’s business and
operations, (vi) NEC’s ability to restructure, or otherwise adjust, its operations to reflect changing market conditions, (vii)
movement of currency exchange rates, particularly the rate between the yen and the U.S. dollar, (viii) the impact of
unfavorable conditions or developments, including share price declines, in the equity markets which may result in losses from
devaluation of listed securities held by NEC, and (iv) impact of any regulatory action or legal proceeding against NEC. Any
forward-looking statements speak only as of the date on which they are made. New risks and uncertainties come up from time
to time, and it is impossible for NEC to predict these events or how they may affect NEC. NEC does not undertake any
obligation to update or revise any of the forward-looking statements, whether as a result of new information, future events, or
otherwise.
The management targets included in this material are not projections, and do not represent management’s current estimates
of future performance. Rather, they represent targets that management will strive to achieve through the successful
implementation of NEC’s business strategies.
Finally, NEC cautions you that the statements made in this material are not an offer of securities for sale. Securities may not
be offered or sold in any jurisdiction in which required registration is absent or an exemption from registration under the
applicable securities laws is not granted.