Presentation [232KB]

Financial Results for the Third Quarter of the Fiscal
Year ending March 31, 2005
January 28, 2005
Oki Electric Industry Co., Ltd.
Table of Contents
1. Financial results for the third quarter of the fiscal
year ending March 31, 2005
1) Outline of financial results
2) Profit and loss outline
3) Balance sheet outline
4) Segment information
5) Cash flows
2. Full year projections for the fiscal year ending
March 31, 2005
1) Premises
2) Segment information
* The projections and plans on this material are subject to change depending upon the
changes of business environments and other conditions.
2
Third Quarter Overview
„
Sales increased substantially, especially sales of IP networks for telecom carriers and
sales of LSIs including LCD drivers and P2ROM
(Approach for leveling imbalance between quarters also contributed)
„ Incomes improved considerably along with sales growth
(Recurring income achieved positive for the nine moths)
„ Improvement of balance sheet includes decrease of interest-bearing debt by 36.2
(Billion yen)
billion yen on a year-on-year basis
Nine month results
Three month results
Dec. 03
Dec. 04
Variance
Net Sales
428.3
478.4
50.1
Operating income
(0.5)
6.4
Recurring income
(7.0)
Net income
Dec. 03
Dec. 04
Variance
147.0
158.7
11.7
6.9
3.3
4.9
1.6
1.7
8.7
1.1
2.3
1.2
(11.5)
(1.1)
10.4
(0.9)
1.8
2.7
Total assets
610.7
589.1
(21.6)
-
-
-
Shareholders’ equity
94.9
111.5
16.6
-
-
-
Interest-bearing debt
322.3
286.1
(36.2)
-
-
3
Third Quarter Profit and Loss Outline
„ Comparison of consolidated P/L
(Billion yen)
Q1 – Q3 (nine months)
<Nine month P/L points>
Q3 (three mo.)
Dec. 03
Dec. 04
Variance
Dec. 03
Dec. 04
428.3
478.4
50.1
147.0
158.7
(75.4%)
(74.1%)
(+1.3%)
(74.3%)
(73.0%)
323.0
354.6
31.6
109.2
115.9
(24.7%)
(24.5%)
(- 0.2%)
(23.4%)
(23.9%)
105.8
117.4
11.6
34.5
37.9
Operating income
(0.5)
6.4
6.9
3.3
4.9
Other income
(6.5)
(4.7)
1.8
(2.2)
(2.6)
Recurring income
(7.0)
1.7
8.7
1.1
2.3
1.1
2.7
1.6
0.3
2.2
Net sales
(Cost of sales ratio)
Cost of sales
(SG&A ratio)
SG&A
Extraordinary
income
Extraordinary
loss
Income before taxes
Income taxes
Net income
„ Sales increased in all
segments, particularly in
telecom and electronic
devices
„ Cost of sales improved
due to reduction of
procurement cost, etc.
„ Operating income
achieved profitability, due
to large improvement in
telecom and electronic
device sectors, while
decline in info segment
„ Net income developed
10.4
5.3
(5.1)
3.0
0.7
(16.3)
(0.9)
15.4
(1.6)
3.8
(4.8)
0.2
5.0
(0.7)
2.0
(11.5)
(1.1)
10.4
(0.9)
1.8
considerably due to
improvement in other and
extraordinary incomes,
added to increase in
operating income
4
Other Income, Extraordinary Income
„ Nine month comparison
z Other income/expenses improved by 1.8 billion yen as financial account balance and foreign
exchange balance improved
z Extraordinary income/loss improved by 6.7 billion yen, largely due to gain on sales of fixed
assets this year and disaster loss in the previous year
(Billion yen)
Dec. 03
Dec. 04
Operating income
Interest and dividends
income
Foreign currency gain
Others
Other income
Interest expense
Foreign currency loss
Others
Other expenses
(0.5)
6.4
0.9
1.1
1.4
2.3
5.5
1.6
1.7
8.8
0.4
0.6
2.1
5.1
1.7
6.8
Recurring income
(7.0)
1.7
Recurring income
Gain on sale of fixed assets
Gain on sale of marketable
securities
Others
Extraordinary income
Loss on sale and disposition
of fixed assets
Disaster loss
Special retirement payments
Others
Extraordinary loss
Income before tax
Dec. 03
Dec. 04
(7.0)
0.0
1.7
1.2
0.9
1.5
0.2
1.1
0.0
2.7
2.3
2.1
3.4
2.1
2.6
10.4
0.0
1.6
1.6
5.3
(16.3)
(0.9)
5
First Half Balance Sheet Outline (1)
<Balance Sheet: Assets>
(Times)
z
Total assets decreased by 21.6 B yen on
year-on-year base, due to reduction of
accounts receivables and inventories
z Major turnover ratios improved
substantially
Turnover ratio
Dec. 03
Dec.04
Variance
Total assets
0.93
1.06
0.13 improved
Notes and accounts
receivable
3.84
4.64
0.80 improved
Inventory
3.41
4.28
0.87 improved
(Billion yen)
600
622.9
27.9
169.9
610.7
44.9
127.7
609.6
55.4
589.1
155.3
119.7
38.7
Variance with
Dec. 31, 2003
Cash and deposits
- 6.2
Notes and accounts receivable
- 8.0
400
200
158.9
157.4
177.4
139.0
27.7
32.4
30.1
35.0
136.4
120.6
119.7
126.2
103.6
107.7
110.1
Dec. 31, 03
Mar. 31, 04
- 18.5
Other current assets
+ 2.6
Propety, plant and equipment
+ 5.6
Investments and other assets
+ 2.9
110.6
0
Mar. 31, 03
Inventories
Dec. 31, 04
6
First Half Balance Sheet Outline (2)
<Balance Sheet: Liabilities and
Shareholders’ Equity>
z
Interest-bearing debt decreased by
36.2 B yen on year-on-year base, due
to improvement in cash flows
Amount of interestbearing debt (B yen)
Interest-bearing debt
ratio (%)
Shareholders’ equity
ratio (%)
Dec. 03
Dec. 04
322.3
286.1
36.2 decreased
52.8
48.6
4.2 improved
15.5
18.9
3.4 improved
(Billion yen)
622.9
610.7
116.1
109.7
126.0
124.7
609.6
600
400
25.6
209.4
44.5
101.3
Notes and accounts payable
135.8
120.0
Short-term borrowings
142.3
31.1
23.7
197.6
161.7
143.8
48.0
40.7
47.8
94.9
110.5
111.5
200
Variance with
Dec. 31, 2003
589.1
129.8
35.8
0
Other current liabilities
Bond and long-term debt
Dec. 31, 03
Mar. 31, 04
Dec. 31, 04
+ 10.3
+ 17.6
- 12.1
- 53.8
Other fixed liabilities and
minority interests
Shareholders' equity
Mar. 31, 03
Variance
- 0.2
+ 16.6
Bonds due within a year and commercial paper are included in long-term debt and short-term borrowings respectively.
7
Third Quarter Segment Information
Net sales
<Q1-Q3 (nine months)>
Net sales
428.3
(Billion yen)
z
Sales increases in all segments
z
In information systems segment, while printer sales
grows, total sales remains slight increase due to
significant decline of ATM caused by completion of
new banknote-related business
z
Telecom segment shows significant growth due to
expansion of investments on infrastructures by
carriers
z
Sales in electronic devices segment increases
considerably, especially sales of LCD drivers and
P2ROMs (5.0 billion yen of business loss caused by
earthquakes in the previous year)
478.4
45.9
Others
36.9
95.9
69.4
113.8
89.5
Electronic
devices
Telecom
226.1
229.2
Mar. 04
Mar. 05
Info
systems
Operating income
Operating income
6.4
(0.5)
Increase in telecom and device sectors covers large
decline in info systems segment. Significant growth
in total
8
Third Quarter: Information Systems
<Q1-Q3 (nine months)>
Net sales
226.1
(Billion yen)
229.2
Printers
89.9
97.9
43.2
42.2
93.0
89.1
Mar. 04
Information
solutions
Financial
system
solutions
Mar. 05
Operating income
10.3
2.5
Net sales
Printers
Printer total sales grows on year-on-year basis.
Increase in color NIP sales and steady in SIDM
Information solutions
Slight decrease from the previous year results due
to tendency of investment deferment in both
governments and enterprises sectors
Financial system solutions
Decrease in sales due to large declines in ATM
sales and pertinent charge-free maintenance
incomes, though sales of counter terminals for
financial institutions grows
Operating income
Large decrease in income, due to decrease in ATM
sales and its maintenance fees, fierce competitions in
information segment, and prior investments for R&D
and for sales expansion in printers
9
Third Quarter: Telecommunications
<Q1-Q3 (nine months)>
Net sales
(Billion yen)
89.5
69.4
17.8
Enterprise
networks
18.0
71.7
Carrier
networks
51.4
Mar. 04
Net sales
Enterprise networks
Business inquiries are active, especially in SS9100,
a pillar of information and telecom converged
solutions, but almost same level of sales as the
previous year
Carrier networks
Considerable sales increase due to expansion of
investments on IP network infrastructures by
telecom carriers
Mar. 05
Operating income
Operating income
2.6
Growth of sales for telecom carriers contributes
significant increase of operating income
(2.6)
10
Third Quarter: Electronic Devices
<Q1-Q3 (nine months)>
Net sales
113.8
95.9
1.4
11.1
16.5
66.9
2.0
11.9
26.0
73.9
(Billion yen)
Optical
components
System memories
Increase in sales of P2ROMs used for amusement
equipment including games, electronic dictionary,
educational equipment, and printers
DRAMs
System
memories
System LSIs,
Logic LSIs
Mar. 04
Net sales
System LSIs, Logic LSIs
Significant increase, especially in LCD drivers
and foundry business. However, signs of
weakening market in LCD drivers and PHS
Mar. 05
Operating income
7.8
Operating income
Significant increase due to large sales increase,
results of business reforms in optical components,
and 3.0 billion yen of business loss by
earthquakes in previous year
(0.3)
11
Cash Flows
z
z
Issued 20.0 billion yen of convertible bonds in Nov. 2004
Full year projections on cash flow is unchanged from Oct. 28 2004 announcement
Q1 – Q3 (Nine months)
I. Cash flows from operating activities
Income (loss) before income taxes
Depreciation & amortization
Changes in operating assets & liabilities
Others
II. Cash flows from investing activities
Purchases of property, plant & equipment
Others
Free cash flows (I+II)
III. Cash flows from financing activities
Bond issuance
Redemption of bonds
Changes in other interest bearing debts, etc.
Net cash flow (I+II+III)
IV. Cash and cash equivalents at the period end
V. Interest-bearing debts at the period end
FY Mar. 04 FY Mar. 05
(results)
38.7
(16.3)
25.2
16.9
12.9
(7.6)
(14.5)
6.9
31.1
(12.6)
0.0
(7.7)
(4.9)
18.5
47.2
322.3
(projections)
24.8
(0.9)
23.7
9.4
(7.4)
(35.9)
(30.5)
(5.4)
(11.1)
(5.6)
20.0
(15.0)
(10.6)
(16.7)
41.7
286.1
Variance
(Billion yen)
Full year for
FY Mar. 05
(Oct 28 project.)
(13.9)
15.4
(1.5)
(7.5)
(20.3)
(28.3)
(16.0)
(12.3)
(42.2)
7.0
20.0
(7.3)
(5.7)
(35.2)
(5.5)
(36.2)
65.0
16.0
35.0
10.0
4.0
(45.0)
(36.0)
(9.0)
20.0
(25.0)
(15.0)
(10.0)
(5.0)
53.1
266.4
12
Premises of Full Year Projections
<Economy forecast>
• While enterprise capital investment remains steady, the active digital appliance market, a
leading force of economy, is toning down
• High material prices, appreciation of yen, and slowdown of exports are causes of concern
<Business environment>
• Info systems: Expansion in the color printer market. Fierce competition in info systems
including financial system solutions
• Telecom:
Continuous expansion of carriers investments to broadband IP networks
• Device:
Semiconductor market growth slows down, which leads downward trend
in unit prices
<Impact on profit by currency exchange rate>
Q3 (nine months) results
Projected rate
Actual rate
Q4 projections
Projected rate
US dollar
105 yen/$
107.7 yen/$
105 yen/$
Euro
130 yen/E
139.5 yen/E
130 yen/E
13
Full Year Projections
Full year projection is unchanged form the previous
announcement on Oct. 28, 2004
Net sales
z
In info systems segment, the printer market remains
steady. Severer price competitions and deferred
investments in financial and government sectors
z
In telecom segment, accelerated investments on
infrastructures by telecom carriers are expected
z
Slowdown of growth in electronic device segment
due to LCD driver price down led by the weakening
market and volume decrease in LSIs for PHS led by
inventory adjustment of terminals
z
Slight decrease in total sales
Operating income
In total, no significant changes. While there are
concerns of income decrease along with sales
reduction in information and device segments,
income increase in telecom sector is expected
<Previous announcement>
(Oct. 28, 04)>
(Billion yen)
Net sales
710.0
654.2
70.0
57.1
Others
155.0
132.2
Devices
130.0
104.6
Telecom
360.3
355.0
Info.
Systems
Mar. 04
Mar. 05
Operating income
Operating income
Net income
29.0
21.6
10.0
1.3
14
Full Year Projections: Information Systems
Net sales
Printers
Sales is expected to reach the projected numbers
due to the steady color NIP and SIDM markets
Information solutions
Deferments of government systems to the next
period and investment curb and delays by travel
industry
Financial system solutions
Delay in rise of new market, such as e-financial
systems, after completion of new banknoterelated businesses, and deferment of investments
by financial institutions
Operating income
<Previous announcement>
(Oct. 28, 04)>
Net sales
360.3
(Billion yen)
355.0
Printers
124.8
86.5
140.0
88.0
149.0
127.0
Mar. 04
Mar. 05
Info
solutions
Financial
system
solutions
Operating income
24.0
Risk of income reduction caused by sales decline
in the financial system and government markets
16.5
15
Full Year Projections: Telecom Systems
Net sales
<Previous announcement>
(Oct. 28, 04)>
Net sales
Carrier networks
Upward sales due to accelerated expansion of local
IP networks, investments on IP network
constructions by telecom carriers, and steady sales
of CPEs, including VoIP gateways
(Billion yen)
130.0
104.6
30.0
26.5
Enterprise
networks
100.0
Carrier
networks
78.1
Mar. 04
Operating income
Mar. 05
Operating income
7.5
Expect increase of operating income caused by
increasing sales
3.4
16
Full Year Projections: Electronic Devices
Net sales
System memories
P2ROMs’ sales further expands, particularly used
for amusement equipment including games,
electronic dictionaries, educational equipment, and
printers
<Previous announcement>
(Oct. 28, 04)>
Net sales
155.0
132.2
3.0
18.0
Optical
components
1.9
15.5
30.0
DRAMs
23.7
System LSIs, Logic LSIs
Sales reduction in PHS baseband LSIs due to
inventory adjustments of terminals in China, and
decline of price for driver LSIs
91.1
104.0
System
memories
System
LSIs, Logic
LSIs
Mar. 04
Operating income
(Billion yen)
Mar. 05
Operating income
13.0
Risks are becoming obvious, as shown in price
pressures caused by the weakening market
2.3
17