Yamaha Corporati Y tion Analyst and Investor Briefing on the Third Quarter of Fiscal Year Ending g March 31,, 2016 (FY2016.3)) February 5, 2016 Overview of Performance in the Third Quarter (October-December) Results Summary Sales increased year-on-year and exceeded previous projections. Operating, ordinary, and net income all rose sharply. 3Q operating income exceeded 15 billion yen, regaining levels prevailing prior to FY2004.3 The operating income ratio rose to 13.3% In the musical instrument segment, actual sales of digital musical instruments and string and percussion instruments rose by double digits year on year year-on-year In the audio equipment segment, actual sales of AV products and professional audio equipment also rose by double digits from the same period of the previous year Although electronic device sales declined year-on-year, profitability was broadly in line with expectations Other businesses showed firm results, especially for shipment of new golf products 2 Performance in the Third Quarter of FY2016.3 (Three Months) (Billions of yen) FY2015.3 FY2016.3 3Q results 3Q results Changes from same period of the previous year Net Sales 116.9 118.3 O Operating ti Income I 10 6 10.6 15 7 15.7 (9.1%) (13.3%) 10.9 15.4 (9 3%) (9.3%) (13 0%) (13.0%) 9.9 13.1 (8.5%) (11.1%) US$ 114 121 120 EUR 143 133 130 US$ 112 121 120 EUR 138 135 130 (Operating Income Ratio) Ordinary Income (Ordinary Income Ratio) Net Income* (Net Income Ratio) +1.2% FY2016.3 3Q previous projections +47.7% +41.0% +32.0% 117.0 11 8 11.8 (10.1%) 11.3 (9 7%) (9.7%) 9.1 (7.8%) Changes from the previous projection p j +1.1% +33.0% +35.9% +43.8% Exchange Rate (yen) Net Sales Operating Income * Net income is presented as net income attributable to owners of parent on the consolidate financial statements **Previous projections were announced on October 30, 2015 3 Performance by Business Segment in the Third Quarter of FY2016.3 (Three Months) Net Sales Operating Income Year-on-year change 116.9 ■Others ■Electronic Devices ■Audio Equipment 5.7 3.0 31.8 (1.2%) (4.6%) (-15.1%) (13.8%) (Billions of yen) Change from the previous projections 118.3 (1.1%) 117.0 6.0 2.6 15.7 0.4 36.2 10.6 0.4 ■Musical Instruments 76.3 (-3.6%) 4.3 11 8 11.8 ■Others ■Audio Equipment 2.7 11.1 73.6 ■Musical Instruments 7.8 ■Electronic Devices -0.3 FY2015.3 3Q FY2016.3 3Q Impact of Exchange Rates Year-on-Year FY2016.3 3Q FY2015.3 3Q (previous projections) -0.1 FY2016.3 3Q FY2016.3 3Q (previous projections) -¥1.7 billion -¥0.3 billion (musical instruments -¥1.1 billion, audio equipment -¥0.7 ¥0 7 billion billion, electronic devices +¥0 +¥0.1 1 billion) (musical instruments -¥0.2 billion, electronic devices -¥0.1 ¥0 1 billion) -¥0.2 billion Versus previous (musical instruments -¥0.1 billion, audio equipment projections -¥0.1 billion) *Previous projections were announced on October 30, 2015 +¥0.8 billion (musical instruments +¥0.3 billion, audio equipment +¥0.5 billion) 4 Musical Instruments 3Q (Three Months) 3Q (Billions of yen) ■Net Sales Music schools, etc. Yamaha musical instruments ■Operating Income 76.3 73.6 20.0 14.6 56.3 59.0 7.8 FY2015.3 3Q 11.1 FY2016.3 3Q 3Q Overview Although sales declined year-on-year, income rose sharply The Th transfer t f off music i school h l operations ti and effect of exchange rate were the main factor behind lower sales Actual sales of digital musical instruments and string and percussion instruments grew by double digits year-on-year, and wind instruments also recorded strong sales The Chinese and European markets achieved double-digit year-on-year growth, and the North American market was also robust Sales in the Japanese market were on a par with the previous year, with gains compensating for declining Electone sales 5 Audio Equipment 3Q (Three Months) 3Q (Billions of yen) ■■■Net Sales ■Operating Income 3Q Overview 31.8 36 2 36.2 4.2 ICT devices PA equipment AV products, karaoke 3.5 13.3 12.2 16.1 2.7 FY2015.3 3Q 18.7 4.3 FY2016.3 3Q Sales and income increased sharply from the same period of the previous year The launch of new AV products helped to drive strong g results in all markets,, with actual sales growing by double digits year-on-year Actual sales of professional audio equipment i also l maintained i i d double-digit d bl di i year-on-year growth, due to factors including new product launches and installation of audio equipment in Japan Revolabs sales rebounded, and sales of communication and karaoke equipment were also robust 6 Electronic Devices 3Q (Three Months) 3Q (Billions of yen) ■Net Sales ■Operating Income 3Q Overview Sales fell year-on-year year-on-year, but profitability improved The recoil effect following advance shipment p of amusement equipment q p in the first half was a factor behind lower sales Profitability was broadly in line with projections, due to the effects of structural reforms f 3.0 -0.3 FY2015.3 3Q 2.6 -0.1 FY2016.3 3Q 7 Others 3Q (Three Months) 3Q (Billions of yen) ■■■■Net Sales ■Operating Income 3Q Overview FA equipment, etc. Resort Golf products Automobile i t i wood interior d component 5.7 6.0 1.1 1.4 1.2 1.2 1.2 1.6 22 2.2 18 1.8 -0.4 FY2015.3 3Q Sales increased from the same period of the previous year, and profitability was steady Golf p product sales increased,, due to shipment of new products In the factory automation equipment segment, leak testers achieved firm sales -0.4 FY2016.3 3Q 8 Performance in the First Three Quarters of FY2015.3 (Nine Months) (Billions of yen) FY2016.3 Changes from the Changes from FY2015.3 FY2016.3 same period of p previous p Q previous p 1 3Q results 1-3Q 1-3Q 1 3Q results the previous year 1-3Q projection projections 323.2 335.8 25.7 36.9 (8.0%) (11.0%) 26.0 37.6 (8.0%) (11.2%) 20.7 30.5 ((6.4%) %) ((9.1%) %) 107 122 121 140 134 133 US$ 105 122 121 EUR 140 134 133 Net Sales Operating Income (Operating Income Ratio) Ordinary Income (Ordinary Income Ratio) Net Income* (Net Income Ratio) Exchange Rate (yen) US$ Net Sales EUR Operating Income +3.9% +43.6% +44.9% 44 9% +47.3% 334.5 33.0 (9.9%) 33.5 (10.0%) 26.5 ((7.9%) %) * Net income is presented as net income attributable to owners of parent on the consolidate financial statements **Previous projections were announced on October 30, 2015 +0.4% +11.9% +12.2% 12 2% +15.1% 9 Cumulative Results for the First Three Quarters: Non-Operating Profit and Loss Recognition of Extraordinary Profit and Loss Recognition of extraordinary loss due to immediate amortization of goodwill It has been decided to record immediate amortization of goodwill for Line 6, Inc., which became a wholly-owned subsidiary of Yamaha Corporation in January 2014. Reason: Line 6 is projected to record losses for two consecutive years, and since delays have occurred in producing results that utilize its product planning and development strengths, strengths it was deemed unlikely that Yamaha Corporation would recoup its investment within the timeframe initially targeted. Impact on consolidated profit and loss: An extraordinary loss of 4.5 billion yen for immediate amortization of goodwill has been recognized. Gain on sale of fixed assets A 5.6 billion yen gain on sale of fixed assets has been recognized following the sale of land and buildings of the former Shinsaibashi store in Osaka and other facilities facilities. 10 Performance by Business Segment in the First Three Quarters of FY2015.3 (Nine Months) Net Sales Change from the previous projections Year-on-year change 323 2 323.2 ■Others ■Electronic Devices ■Audio Equipment 17.8 10.6 (3.9%) (0.7%) (-0.4%) 82 5 82.5 ((9.8%)) Operating Income (Billions of yen) 335.8 (0.4%) 334 5 (0 4%) 334.5 17.9 10.5 36.9 90.6 0.7 25.7 25 7 0.6 7 7.8 8 0.3 ■Musical Instruments 212.4 (2.0%) 33.0 ■Others ■Electronic Devices ■Audio Equipment 4.7 27.8 216.7 22.0 ■Musical Instruments -1.2 FY2015.3 1-3Q FY2016.3 1-3Q FY2016.3 1-3Q FY2015.3 1-3Q (previous projections) FY2016.3 1-3Q (previous projections) Impact of Exchange Rates Year-on-Year FY2016.3 1-3Q +¥8.5 billion -¥0.4 billion (musical instruments +¥6.2 billion, audio equipment +¥2 0 billion +¥2.0 billion, electronic devices +¥0 +¥0.2 2 billion) (musical instruments +¥0.8 billion, audio equipment -¥0.9 ¥0 9 billion billion, electronic devices -¥0.3 ¥0 3 billion) -¥0.2 billion Versus previous (musical instruments -¥0.1 billion, audio equipment projections -¥0.1 billion) *Previous projections were announced on October 30, 2015 +¥0.8 billion (musical instruments +¥0.3 billion, audio equipment +¥0.5 billion) 11 FY2016.3 1-3Q Operating Income Analysis (Nine Months) Versus same period of the previous year Increase in labor cost Increase in at overseas SG&A factories -¥0.8 -¥1.4 Increase in fit bilit off Increase in I Impact t off profitability electronic exchange sales and devices rates gross margin -¥0.4 (Billi (Billions off yen)) Improvement in manufacturing cost +¥2.1 +¥3.2 36.9 +¥8.5 25.7 FY2016 3 1-3Q FY2016.3 FY2015 3 1-3Q FY2015.3 1 3Q Versus previous projections Electronic devices not reaching the planned cost measures -¥0.1 ¥0 1 Increase in sales and production Impact of exchange rates Decrease in SG&A +¥1.5 +¥1.7 36.9 +¥0.8 ¥0.8 33.0 FY2016.3 1-3Q FY2016.3 1-3Q (previous projections) *Previous projections were announced on October 30, 2015 ** Impact of exchange rates has been adjusted after the review of calculation method of currency exchange rates, the above figures may differ from the previously announced figures. 12 Outlook for Fourth Quarter and Full Year Outlook for 4Q Despite concerns over the slowdown in the Chinese market and elsewhere and the impact of advance shipments of some products in 3Q, the outlook for the musical instrument and audio equipment segments is generally in line with previous projections Previous projections also remain largely unchanged for the electronic device and others segments No particular increase in SG&A expenses, etc. is anticipated Full Year Outlook Although strong results were recorded in the 3Q period of highest demand, and cumulative profitability over the first three quarters exceeded previous projections by a wide margin, projections for 4Q remain basically unchanged. The full year sales projection also remains unaltered at 437 437.0 0 billion yen yen. Full year income projections have been revised to 41.0 billion yen for operating income, 41.5 billion yen for ordinary income, and 34.5 billion yen for net income. 13 Forecast for Performance in FY2015.3 (Full Year) (Billions of yen) FY2014.3 1-3Q 4Q FY2015.3 Full Year 108.9 432.2 1-3Q 4Q projections p j 335.8 101.2 Net Sales 323.2 Operating I Income 25.7 4.4 30.1 36.9 4.1 (Operating Income Ratio) (8.0%) (4.1%) (7.0%) (11.0%) (4.1%) Ordinary Income 26.0 5.3 31.2 37.6 3.9 (Ordinary Income Ratio) ((8.0%)) ((4.8%)) ((7.2%)) (11.2%) (3.9%) Net Income* 20.7 4.2 24.9 30.5 4.0 (Net Income Ratio) (6.4%) (3.9%) (5.8%) (9.1%) (4.0%) ROE 8.1% Change from FY2015.3 full Change from previous year previous previous Full Year New year results projections projections Projections 437.0 +1.1% 437.0 41.0 +36.1% +36 1% (9.4%) 41.5 +32.9% (9.5%) 34.5 +38.4% (7.9%) - 37.0 +10.8% +10 8% (8.5%) 37.5 +10.7% ((8.6%)) 29.0 +19.0% (6.6%) 10.0% 8.3% Exchange Rate (yen) Net Sales Operating Income US$ 107 119 110 122 120 121 121 EUR 140 134 139 134 130 133 133 US$ 105 119 109 122 120 121 121 EUR 140 144 141 134 130 134 132 * Net income is presented as net income attributable to owners of parent on the consolidate financial statements **Previous projections were announced on October 30, 2015 14 FY2016.3 Full Year Forecast for Performance by Business Segment Net Sales Operating Income Year-on-year change 432 2 432.2 ■Others ■Electronic Devices ■Audio Equipment 24.2 13.4 (1 1%) (1.1%) (-1.0%) Change from the previous projections 437.0 ( - ) 24.0 13.0 (-3.2%) 437 0 437.0 (-) (5.0%) 41.0 24.0 13.0 (-) 118 5 118.5 112 8 112.8 (Billions of yen) 118 5 118.5 (-) 37.0 30.1 0.5 0.5 85 8.5 0.5 05 0.5 0.4 7.5 ■Others ■Electronic Devices ■A di ■Audio Equipment 6.1 ■Musical Instruments 31.5 281.7 (-0.1%) 281.5 (-) 281.5 25.1 28.5 ■Musical Instruments -1.4 FY2016.3 FY2015.3 FY2016.3 FY2015.3 (previous projections) FY2016.3 (previous projections) Impact of Exchange Rates Year-on-Year FY2016.3 +¥7.4 billion -¥1.7 billion (musical instruments +¥5.5 billion, audio equipment +¥1 6 billion +¥1.6 billion, electronic devices +¥0 +¥0.2 2 billion) (musical instruments -¥1.3billion, electronic devices -¥0.3 ¥0 3 billion) -¥0.9 billion Versus previous (musical instruments -¥0.6 billion, audio equipment projections -¥0.3 billion) *Previous projections were announced on October 30, 2015 +¥0.8 billion (musical instruments +¥0.2 billion, audio equipment +¥0.5 billion) 15 FY2016.3 Full Year Operating Income Analysis Versus same period of the previous year 30.1 (Billi (Billions off yen)) Improvement in manufacturing cost Increase in +¥4.1 sales and production Increase in labor cost +¥8.1 Increase in at overseas profitability of factories Increase in Impact of electronic SG&A exchange devices -¥1.8 rates -¥0.2 +¥2.3 41.0 -¥1.6 FY2016 3 FY2016.3 FY2015 3 FY2015.3 projections Increase in sales and gross margin Versus previous projections Impact of exchange rates Increase in SG&A +¥1.4 41.0 +¥1.8 +¥0.8 37.0 FY2016 3 FY2016.3 FY2016 3 FY2016.3 (previous projections) projections *Previous projections were announced on October 30, 2015 ** Impact of exchange rates has been adjusted after the review of calculation method of currency exchange rates, the above figures may differ from the previously announced figures. 16 Musical Instruments Full Year Projections Full Year (Billions of yen) ■Net Sales ■Operating Income Full Year Projections Full year sales projections remain unchanged, and income is expected to be higher than previously projected Sales of digital g musical instruments,, wind instruments, and string and percussion instruments are expected to remain robust Although a slowdown is likely in the E European and d Chinese Chi markets k in i 4Q, 4Q results are expected to be broadly in line with previous projections 281.7 281.5 281.5 Music schools, etc. 78.2 63.4 63.8 Yamaha musical instruments 203.5 218.1 217.7 25.1 31.5 28.5 FY2015.3 FY2016.3 FY2016.3 (previous projections) *Previous projections were announced on October 30, 2015 17 Musical Instruments: Sales by Region Sales Projections (including software products and music schools) (Billions of yen) *Figures in blue parentheses show actual year-on-year changes, excluding the sales of music school Figures in red parentheses show actual year-on-year changes, discounting the impact of exchange rates 105.0 88.9 88 9 (97%) (85%) 4Q 26.9 21.8 (81%) 3Q 56.8 56 8 (104%) 26 1 26.1 1-3Q 20.5 (79%) 50.2 14.0(102%) (86%) 9.7 13 6 13.6 2Q 24 2 24.2 49.4 51.4 19.4 (104%) (80%) 1Q 27.8 27.2 (98%) 14.0(107%) 12.5 13 0 13.0 (101%) 10.1 (106%) 29 3 29.3 16.2 16.9 (112%) (109%) 15 8((105%)) 15.8 11.0 13.1(101%) 47.8 48.2 (109%) 13.8 8 (109%) 12.8 13 10.6 10.7 (105%) FY2015 3 FY2016.3 FY2015.3 FY2016 3 FY2015 3 FY2016.3 FY2015.3 FY2016 3 FY2015 3 FY2016.3 FY2015.3 FY2016 3 Japan North America Europe 36.1 (113%) 11 2 11 8 11.2 11.8 (99%) 7.8 (108%) 8.9 (117%) 7.2 7 (115%) 7.5 5 11.1 (114%) 8.5 6.1 8.3 (114%) FY2015 3 FY2016.3 FY2015.3 FY2016 3 China 14.0 13.2 (99%) ((102%)) 12 (103%) 3 11.9 12.3 10.1 11.5 (105%) FY2015 3 FY2016.3 FY2015.3 FY2016 3 Other Regions 18 Audio Equipment Full Year Projections Full Year (Billions of yen) ■■■Net Sales ■Operating Income Full Year Projections Full year sales projections remain unchanged, but income is expected to be higher than previously projected Ay year-on-year y rise in sales of AV p productsICT devices is anticipated, partly driven by new products PA equipment Professional audio equipment results are lik l to be likely b boosted b d by b new products d and d sales through musical instrument channels AV products, Strong sales of karaoke and ICT k karaoke k (information and communication technology) devices are also anticipated 112.8 118 5 118.5 118 5 118.5 13.6 15.3 15.2 47.4 51.8 52.2 51.9 51.3 51.2 6.1 8.5 7.5 FY2016.3 FY2016.3 FY2015.3 (previous projections) *Previous projections were announced on October 30, 2015 19 Audio Equipment: Sales by Region (Billions of yen) 31.4 (99%) 6.7 24.3(99%) (108%) 6.4 (101%) 30.1 28.7 24.7 31.0 Figures in parentheses show actual year-on-year changes, discounting the impact of exchange rates (85%) 6.5 7.9 20.6 (108%) 19.6 4Q 8.8 8.5 (96%) 9.9 9 9 (111%) 92 9.2 10 4 (121%) 10.4 4.5 8.5 3Q 5.3 5.9 (111%) 8.0 1-3Q (100%) 2Q 5.0 (109%) (104%) 5.9 (117%) (103%) 6.6 7.5 7.8 (96%) 1Q 5.5 4.1 (74%) 5.7 6.7 6.8 6.4 (105%) (99%) FY2015.3 FY2016.3 FY2015.3 FY2016.3 FY2015.3 FY2016.3 Japan North America Europe 9 7 11.2 (110%) 9.7 2.1 (86%) 2.5 3.5 (132%) 2.6 (119%) (108%) 2.4 2.8 2.2 2.7 (115%) FY2015.3 FY2016.3 China 61 6.1 4 2(96%) 4.2 6.4(113%) (112%) 4.8 5.3(110%) 4.1 4.7(111%) FY2015.3 FY2016.3 Other Regions 20 Musical Instruments/Audio Equipment: Sales by Major Product Category (Yamaha branded products) (Billions of yen) Musical Instruments Piano 50.1 4Q 3Q 2Q 1Q 12.8 13.3 Digital Musical Instruments 52.6 (101%) 12.6 (99%) 13.1 (100%) 14.7 11.1 12.1 FY2015.3 FY2016.3 (100%) Wi d Instruments Wind I t t 42.6 (109%) 9.8 (102%) 19.0 ((103%) %) (100%) 26 2 26.2 28 1 28.1 8.6 (105%) 8.3 11.7 21.5 18.7 15.5 23.1 19.8 (102%) (114%) 12.5 FY2015.3 FY2016.3 (113%) 48.4 9.5 (102%) (94%) 17.9 (117%) (104%) (100%) 11.5 12.2 9.2 8.8 FY2015.3 FY2016.3 (99%) FY2015.3 FY2016.3 String St i and d Percussion P i Instruments 27.5 (89%) PA E Equipment i t 47.4 (108%) 14 7 14.7 51.8 (109%) 14.5 (100%) 13.3 (112%) 12.6 (111%) (114%) 6.3 (103%) 7.7 (110%) 62 6.2 73 7.3 ((111%) %) 10 9 10.9 5.2 6.1 (109%) 9.5 11.5 FY2015.3 FY2016.3 FY2015.3 FY2016.3 6.2 7.1 (110%) 10.3 46.5 ((110%) %) 24.8 9.6 9.7 19.3 89.9 (104%) (105%) 12.9 (112%) 85 7 85.7 AV Products (excl. parts) 10.4 1-3Q (102%) 37.9 Audio Equipment 12.2 (113%) Figures in parentheses show actual year-on-year changes, discounting the impact of exchange rates 21 Electronic Devices Full Year Projections Full Year (Billions of yen) ■Net Sales ■Operating Income Full Year Projections Previous projections remain unchanged Conditions will remain challenging in the amusement equipment market It will be difficult to increase sales of geomagnetic sensors and other products above previous projections Structural reforms are expected to improve profitability and pull the segment back into the black 13.4 13.0 13.0 0.5 0.5 -1.4 FY2015.3 FY2016.3 FY2016.3 (previous projections) *Previous projections were announced on October 30, 2015 22 Others Full Year Projections Full Year (Billions of yen) ■■■■Net Sales ■Operating Income Full Year Projections Previous projections remain unchanged New golf products are expected to boost sales FA equipment, etc. Plans to attract more customers in winter are expected to spur resort sales In the factory automation equipment Resort business, conditions will remain challenging for precision machine, but Golf products increased demand is anticipated for leak testers and other products Automobile interior wood component 24 2 24.2 24 0 24.0 24 0 24.0 64 6.4 69 6.9 68 6.8 4.9 5.0 5.5 5.7 5.6 7.7 6.5 6.5 4.7 0.4 0.5 FY2015.3 FY2016.3 0.5 FY2016.3 (previous projections) *Previous projections were announced on October 30, 2015 23 Capital Expenditure/Depreciation/R&D Expenses (Billi (Billions off yen)) Capital Expenditure (Depreciation) ■Others ■Electronic Devices ■Audio Equipment ■M i l Instruments ■Musical I t t 0.6 0.6 (9.4) 9.8 (9.2) 0.7 06 0.6 1.9 7.7 13 8 13.8 0.8 0.6 (12.6) 12.3 (12.7) 0.8 0.7 2.8 13 8 13.8 0.7 0.6 (12.9) 4.8 43 4.3 2.2 9.5 6.7 FY2015.3 1Q FY2015.3 FY2016.3 1Q 25 4 25.4 R&D E Expenses 0.9 18.5 2.7 1.4 18.5 1.4 3.4 FY2016.3 FY2016.3 projections (previous projections) 25 1 25.1 1.8 2.2 1.7 25 5 25.5 2.3 1.6 11.0 11.7 12 0 12.0 95 9.5 95 9.5 8.3 8.5 6.5 7.0 96 9.6 FY2016.3 1Q FY2015.3 FY2015.3 1Q 7.8 6.5 4.3 *Previous projections were announced on October 30, 2015 FY2016.3 FY2016.3 projections (previous projections) 24 Inventories Inventories at the end of the third quarter (December 31, 2015) amounted to 95.2 billion yen. Actual inventories increased by 4.8 billion yen year-on-year after adjusting for foreign exchange impact of -4.5 billion yen. Inventories at the end off the fiscal f year are fforecast to be 92.1 billion yen. Although this will exceed the optimum inventory level, there are no significant issue such as (Billions of yen) defective or immobile stock. End of 3Q 94.9 End of Fiscal Year 95.2 87.8 Goods in process/ materials Other products 28.4 28.0 27.7 4.3 4.8 Audio Equipment 20.6 19.9 Musical Instruments 41.6 42.4 FY201 3 FY2015.3 FY2016 3 FY2016.3 4.7 16.7 38.8 FY2015.3 92.1 90.3 26.2 26.2 4.0 3.6 18.4 17.6 43.5 42.9 FY2016.3 Impact of Exchange Rates Year-on-Year Versus previous projections FY2016.3 (previous projections) -¥4.5 billion - -¥1.1 billion -¥1.1 billion 25 Balance Sheet Summary (Billi (Billions off yen)) As of end of fiscal year end As of end of 3Q As of Dec. 31, As of Dec. 31, 2014 2015 Change Cash and deposits 74.5 99.5 25.0 Notes and accounts receivable 68.2 62.8 5.4 94.9 19.4 262.0 95.2 23.6 262.5 0.3 4.2 0.5 519.0 23.0 19.8 146.5 329.7 519.0 543.6 18.9 20.5 140.8 363.4 543.6 24.6 -4.1 0.7 -5.7 33.7 24.6 Inventories Other current assets Fixed assets Total assets Notes and accounts payable Short- and long-term loans Other liabilities Total net assets Total liabilities and net assets As of Mar. 31, As of Mar. 31, 2016 projections 2015 79.3 60.3 87.8 20.2 282.4 530.0 23.2 11.8 146.3 348.7 530.0 89.4 54.1 92.1 30.9 250.5 517.0 20.4 11.8 137.8 347.0 517.0 Change 10.1 -6.2 4.3 10.7 -31.9 -13.0 -2.8 0 -8.5 -1.7 -13.0 26 Return to Stockholders: Stock Buyback and Dividends Decision to acquire treasury stock Reason: To increase the return profits to shareholders p capital p efficiency y and improve Type of shares to be acquired: Common stock of Yamaha Corporation Total shares to be acquired: 9 million shares (upper limit) Total value of acquisition: 20 billion yen (upper limit) Acquisition period: From February 5 to July 15, 2016 Method of acquisition: Purchase in the market through a trust bank The year-end dividend has been revised upward by 8 yen per share to 26 yen, consequently the annual dividend for FY2016.3 is f t tto b forecast be 44 yen FY2011.3 Annual per-share dividend (yen) 10 Dividend payout ratio 38.6% FY2012.3 10 - FY2013.3 FY2014.3 FY2015.3 FY2016.3 10 27 36 44 47.0% 22.8% 28.0% 24.6% 27 Appendix 付 属資料 Forecast for Performance in the Fourth Quarter of FY2016.3 (Three Months) (Billions of yen) FY2014.3 FY2015.3 4Q 4Q Q results esu ts p projections oject o s Changes from same period of the previous year Net Sales 108.9 101.2 Operating O i Income 4.4 4.1 (4.1%) (4.1%) Ordinary Income 53 5.3 39 3.9 (Ordinary Income Ratio) (4.8%) (3.9%) 4.2 4.0 (3 9%) (3.9%) (4 0%) (4.0%) US$ 119 120 120 EUR 134 130 130 US$ 119 120 120 EUR 144 130 130 (Operating Income Ratio) Net Income* (Net Income Ratio) -7.1% FY2015.3 Changes from the 4Q previous pprevious pprojection j projections -7.3% -26.1% -5.3% 102.5 4.0 (3.9%) 40 4.0 (3.9%) 2.5 (2 4%) (2.4%) -1.3% +2.5% -2.5% +60.0% Exchange Rate (yen) Net Sales Operating Income * Net income is presented as net income attributable to owners of parent on the consolidate financial statements **Previous projections were announced on October 30, 2015 29 Forecast for Performance by Business Segment in the Fourth Quarter of FY2016.3 (Three Months) Net Sales Year-on-year change 108.9 ■Others ■Electronic Devices ■Audio Equipment ( 7 1%) (-7.1%) 6.5 2.9 Operating Income Change from the previous projections 101 2 (-1.3%) 101.2 (-5.7%) (-13.3%) 30.3 (-7.9%) 6.1 2.5 (Billions of yen) 102.5 27.9 44 4.4 41 4.1 1.5 0.7 4.0 ■Others ■Electronic Devices ■A di ■Audio Equipment 0.1 ■Musical Instruments 69.3 (-6.6%) 3.1 64.7 -0.3 FY2015.3 4Q FY2016.3 4Q Impact of Exchange Rates Year-on-Year FY2016.3 4Q ■Musical Instruments 3.7 -0.1 -0.2 FY2015.3 4Q (previous projections) FY2016.3 4Q FY2016.3 4Q (previous projections) -¥1.1billion -¥1.3 billion (musical instruments -¥0.7 billion, audio equipment -¥0.4 ¥0 4 billion) (musical instruments -¥0.8billion, audio equipment -¥0.5 ¥0 5 billion) -¥0.8 billion Versus previous (musical instruments -¥0.5 billion, audio equipment projections -¥0.3 billion) *Previous projections were announced on October 30, 2015 ¥0 billion (musical instruments -¥0.1 billion, audio equipment +¥0.1 billion) 30 Third Quarter Non-Operating Income/Loss & Extraordinary Income/Loss (Nine Months) FY2014.3 1-3Q (Billions of yen) FY2015.3 1-3Q FY2015.3 1-3Q previous projections Non-Operating Income/Loss Net financial income Other Patent income +¥0.6 1.3 1.6 1.5 -1.0 -0.9 -1.0 0.3 0.7 0.5 Total -Gain on sales of fixed assets (music instrument store and residential quarters) +¥6.2 Extraordinary Income/Loss Income from (loss on) disposal of fixed assets Other T t l Total 0 56 5.6 04 0.4 -0.7 -4.7 -0.4 -0.7 0 09 0.9 0 -Immediate amortization of goodwill of Line 6 -¥4.5 Income Taxes and Other Expenses I Income taxes t -currentt 57 5.7 81 8.1 74 7.4 Income taxes -deferred -1.3 -0.2 -0.5 0.2 0.1 01 0.1 4.6 8.0 7.0 Minority y interests in income Total *Previous projections were announced on October 30, 2015 31 Full Year Non-Operating Income/Loss & Extraordinary Income/Loss (Billions of yen) FY2015.3 full year FY2016.3 full year FY2016.3 full year projections previous projections Non-Operating p g Income/Loss Net financial income Other Total 2.6 2.6 2.4 -1.5 -2.1 -1.9 1.1 0.5 0.5 -Gain on sales of fixed assets (music instrument store and residential quarters) +¥6.2 -Gain on disposal of idle land +¥2.7 Extraordinary Income/Loss IIncome from f (loss (l on)) disposal of fixed assets Other -Structural reform expenses -¥1.8 -Impairment loss on fixed asset -¥0.9 Total 0 81 8.1 0 0.4 -2.7 -5.6 -0.4 -2.7 2.5 0 -Immediate amortization of goodwill of Line 6 -¥4.5 Income Taxes and Other Expenses Income taxes -current 7.3 9.1 9.0 Income taxes -deferred -3.9 0.4 -0.5 9.5 8.5 Minority interests in income Total *Previous projections were announced on October 30, 2015 02 0.2 3.6 32 Quarterly Sales and Income (Billi (Billions off yen)) 118.3 116.9 106.8 108.9 111.9 105.5 101.2 99.6 6.2 6 2 1Q 10 6 4 10.6 4.4 4 2Q 3Q 4Q FY2015.3 89 8.9 111.9 105.5 12.4 15.7 4.1 41 89 8.9 1Q 2Q 3Q 4Q FY2016.3 (projections) 1Q 89 8.9 117.0 102 5 102.5 12.4 11.8 11 8 40 4.0 2Q 3Q FY2016.3 4Q (previous projections) Net Sales Operating Income 432.2 30.1 Net Sales Operating Income *Previous projections were announced on October 30, 2015 437.0 41.0 Net Income Operating Income 437.0 37.0 33 In this report, the figures forecast for the Company’s future performance have been calculated on the basis of information currently available to Yamaha and the Yamaha Group. Forecasts are, therefore, subject to risks and uncertainties. Accordingly, actual performance may differ greatly from our predictions depending on changes in the economic conditions surrounding our business, demand trends, and the value of key currencies, such as the U.S. dollar and the euro.