RNS Number:1723O
Mitsubishi Electric Corporation
31 July 2003
Investor Relations Inquiries:
Yasumitsu Kugenuma
Corporate Finance Department
Tel:+81-3-3218-2391 Yasumitsu.Kugenuma@hq.melco.co.jp
Media Contact:
Robert Barz
Public Relations Department
Tel: +81-3-3218-2346
Robert.Barz@hq.melco.co.jp
MITSUBISHI ELECTRIC ANNOUNCES Ql RESULTS
(APRIL 1,2003 - JUNE 30,2003)
TOKYO, July 31, 2003 - Mitsubishi Electric Corporation (hereafter, the Company)
today announced its financial results for the first fiscal quarter ending June
30, 2003 as follows:
Consolidated
Net sales 740.2 billion yen (2% increase year on year)
Operating income 8.9 billion yen (16% increase year on year)
Income before income taxes 8.3 billion yen (785% increase year on year)
Net income 0.6 billion yen (23% decrease year on year)
In the first quarter of fiscal 2004 (April 1, 2003 - March 31, 2004) some Asian
countries continued to experience economic expansion. But the global economy on
the whole slowed down, especially in the United States and Europe, with the
Japanese economy experiencing a decrease in exports along with the ongoing
stagnant recovery in domestic demand. Consequently, the business environment
facing the Company continues to be severe.
Under these conditions, the Company continued to restructure its businesses by
spinning off most of its semiconductor business, mainly system LSIs, and
established Renesas Technology Corp. (a joint venture with Hitachi Ltd.
established on April 1, 2003, an affiliated company accounted for by the equity
method). The Company also made efforts to improve and reinforce profitability in
each business and implemented company-wide managerial improvement measures,
including "E 2 21 Project Activities" for drastically reducing procurement costs
and "EA21 Activities" for curtailing inventory and other assets and fixed costs.
These efforts combined with our promotion of growth strategies for expanding
added value were pursued to further improve business performance and financial
standing and to strengthen our management foundation.
Consolidated Results by Business Segment
In the Energy and Electric Systems segment, sales rose 5% to 141.0 billion yen
year on year with an operating loss of 1.2 billion yen, which worsened by 0.6
billion yen year on year.
Sales and orders in the social infrastructure business were lower compared to
the same quarter last year. This was partially due to a decrease in private
capital investment by domestic power and manufacturing companies and in public
investment. In addition, the spinning off of our power electric systems and
power transformer businesses contributed to these lower sales and orders. For
the building systems business, despite a slump in demand in new domestic
elevator installations, it posted the same level of orders as the same quarter
last year, but achieved an increase in sales thanks to large overseas projects.
As a result, total sales for this segment were up 5% year on year while
operating income worsened by 0.6 billion yen due to price declines, etc.
In the Industrial Automation Systems segment, sales rose 16% to 167.2 billion
yen year on year while operating income increased by 2.7 billion yen to 16.1
billion yen year on year.
The industrial products business posted increases in both sales and orders. This
was due to an increase in domestic demand by manufacturers of semiconductors,
liquid crystal displays (LCD) and automobile products for processing machinery,
along with increased foreign demand of programmable controllers, servo motors
and numerical controllers (NC) in Taiwan, South Korea, China and other Asian
countries. Sales for this quarter in the automotive equipment business exceeded
that of the preceding year due to increases in electronic equipment for Japanese
and overseas automobile manufacturers.
As a result, total sales for this segment were up 16% year on year and operating
income increased by 2.7 billion yen due to stronger sales, etc.
In the Information and Communication Systems segment, sales rose 25% to 149.8
billion yen year on year with an operating loss of 1.1 billion yen, which
represents an improvement of 3.9 billion yen, year on year.
Sales and orders in the telecommunications business increased thanks to a rise
in domestic mobile handset sales and wireless base stations to China. The
information systems and services business posted increased sales thanks to a
growth in mainly system integration and system operation service projects.
Orders in the space business fell year on year due to the between season of
major government projects. But sales rose compared to the same quarter last
year. The defense electronics business also saw a drop in orders due to
reduction in major projects, while sales gained against the same quarter last
year.
As a result, total sales for this segment increased 25% year on year and
operating income improved by 3.9 billion yen due to improved profitability in
the mobile handset business, etc.
In the Electronic Devices segment, sales fell 60% to 43.3 billion yen year on
year with an operating loss of 3.3 billion yen, which represents an improvement
of 5.6 billion yen, year on year.
The semiconductor business faced reduced sales and orders. This occurred because
of the spinning off of the system LSIs and system memory businesses that offset
the increases in power amplifiers for mobile handsets with digital cameras and
laser diodes for recordable DVDs. The liquid crystal business also experienced a
decrease in both sales and orders due to a wide-scale price collapse in the
commodity market (i.e. PC-use, etc.) despite solid results in the display
business for factory equipment and other industrial products.
As a result, total sales for this segment decreased 60% year on year and
operating income improved by 5.6 billion yen due to improved semiconductor
business performance, etc.
In the Home Appliances segment, sales rose 12% to 195.9 billion yen year on year
while operating income was 4.9 billion yen, which represents a decrease of 8.0
billion yen, year on year.
Sales rose in this segment due to increases in ventilators, hot water heaters,
solar power generation systems and other residential home equipment, DVD-related
equipment and packaged air conditioners for Japan and Europe while sales in home
air conditioners and liquid crystal projectors decreased.
As a result, total sales for this segment increased 12% year on year while
operating income worsened by 8.0 billion yen due to price declines, etc.
In the Others segment, sales fell 12% to 111.9 billion yen year on year while
operating income was 1.1 billion yen, which represents a decrease of 2.3 billion
yen, year on year. Overall sales decreased due mainly to the change of our
financial subsidiary into an affiliated company accounted for by the equity
method, and other factors.
As a result, total sales for this segment decreased 12% year on year while
operating income worsened by 2.3 billion yen due to weak sales, etc.
Forecast for 1st Half Period (April 1,2003 to September 30,2003)
Although the recovery in demand both in Japan and overseas remains unforeseeable
as the harsh business environment is expected to continue, the current interim
forecasts for Fiscal 2004 (April 1, 2003 - September 30, 2003) are the same as
its original forecast, which was announced on April 28, 2003 as per below:
Consolidated
Net sales 1.5000 trillion yen (8% decrease year on year)
Operating income 5.0 billion yen (78% decrease year on year)
Income before income taxes 5.0 billion yen (58% decrease year on year)
Net income Nil
Note: The forecast of results above is based on assumptions deemed reasonable by
the Company at the present time, and actual results may differ significantly
from forecasts.
CONSOLIDATED FINANCIAL RESULTS
(In billions of yen)
FY'04 1st quarter FY'03 1st quarter
April 1-June 30, 2003 April 1-June 30, 2002 A/B(%)
(A) (B)
Net sales 740.2 726.8 102
Operating income 8.9 7.7 116
Income before income taxes 8.3 0.9 885
Net income 0.6 0.8 77
Net income per share (in yen) 0.31 0.40 77
Note:
1) Consolidated financial charts made according to U.S. GAAP.
2) Company has 136 consolidated subsidiaries,
3) This report is unaudited.
CONSOLIDATED PROFIT AND LOSS STATEMENT
(In millions of yen)
FY' 04 FY '03
1st Quarter % of 1st Quarter % of
April - June total April - June total A - B A / B (%)
Net sales 740,212 100.0 726,876 100.0 13,336 102
Cost of sales 562,790 76.0 535,801 73.7 26,989 105
Selling, general and
administrative expenses 168,473 22.8 183,350 25.2 (14,877) 92
Operating income 8,949 1.2 7,725 1.1 1,224 116
Non-operating income 12,340 1.7 8,280 1.1 4,060 149
Interest and Dividends 2,841 0.4 3,797 0.5 (956) 75
Other income 9,499 1.3 4,483 0.6 5,016 212
Non-operating expenses 12,965 1.8 15,064 2.1 (2,099) 86
Interest 4,393 0.6 5,543 0.8 (1,150) 79
Other expenses 8,572 1.2 9,521 1.3 (949) 90
Income before
income taxes 8,324 1.1 941 0.1 7,383 885
Income taxes 5,351 0.7 339 0.0 5,012 16 times
Equity in earnings (losses)
of affiliated companies (2,315) (0.3) 255 0.0 (2,570) -
Net income 658 0.1 857 0.1 (199) 77
CONSOLIDATED BALANCE SHEET
(In millions of yen)
FY '04
Quarter ending FY '03 ending
June 30, 2003 March 31, 2003 A - B
(A) (B)
(Assets)
Current assets 1,815,288 1,937,537 (122,249)
Cash and cash equivalents 417,507 363,595 53,912
Short-term investments 22,489 22,523 (34)
Trade receivables 654,277 821,943 (167,666)
Inventories 487,172 510,750 (23,578)
Prepaid expenses and other current assets 233,843 218,726 15,117
Long-term trade receivables 13,285 19,795 (6,510)
Investments 448,375 359,961 88,414
Net property, plant and equipment 596,771 727,770 (130,999)
Other assets 573,787 628,574 (54,787)
Total assets 3,447,506 3,673,637 (226,131)
(Liabilities and shareholders'
equity)
Current liabilities 1,410,715 1,589,322 (178,607)
Bank loans and current portion of
long-term debt 486,458 555,863 (69,405)
Trade payables 555,976 650,696 (94,720)
Other current liabilities 368,281 382,763 (14,482)
Long-term debt 621,232 628,361 (7,129)
Employee retirement and severance benefits 938,786 995,765 (56,979)
Other fixed liabilities 12,536 11,596 940
Minority interests 52,629 54,006 (1,377)
Shareholders' equity 411,608 394,587 17,021
Capital 175,820 175,820 -
Capital surplus 210,671 210,671 -
Retained earnings 345,068 350,851 (5,783)
Accumulated other comprehensive income(loss) (319,879) (342,687) 22,808
Treasury stock at cost (72) (68) (4)
Total liabilities and stockholders' equity 3,447,506 3,673,637 (226,131)
Balance of Debt 1,107,690 1,184,224 (76,534)
Accumulated other comprehensive income (loss)
Foreign currency translation adjustments (2,143) (686) (1,457)
Minimum pension liability adjustments (332,712) (346,546) 13,834
Net unrealized gains on securities 14,976 4,545 10,431
Fiscal 2004, 1st quarter: April 1, 2003 June 30, 2003
CONSOLIDATED CASH FLOWS
(In millions of yen)
FY '04 FY '03
1st Quarter 1st quarter
April 1 - April 1 - A - B
June 30, 2003 June 30, 2002
I Cash flows from operating activities
1 Net income 658 857 (199)
2 Adjustments to reconcile net income to net cash
provided by operating activities
(1) Depreciation 26,165 49,764 (23,599)
(2) Decrease in trade receivables 123,649 149,379 (25,730)
(3) Decrease (increase) in inventories (18,971) (65,394) 46,423
(4) Increase (decrease) in trade payables (49,404) (91,393) 41,989
(5) Other, net (13,565) (27,523) 13,958
Net cash provided by operating activities 68,532 15,690 52,842
II Cash flows from investing activities
1 Capital expenditure (15,761) (27,608) 11,847
2 Proceeds from sale of property, plant and equipment 2,983 1,527 1,456
3 Purchase of short-term investments and investment securities (19,997) (3,985) (16,012)
4 Proceeds from sale of short-term investments and investment
securities 21,723 9,694 12,029
5 Other, net 8,146 1,794 6,352
Net cash used in investing activities (2,906) (18,578) 15,672
I + II Free cash flow 65,626 (2,888) 68,514
III Cash flows from financing activities
1 Proceeds from long-term debt 51,879 68,681 (16,802)
2 Repayment of long-term debt (17,230) (60,344) 43,114
3 Increase (decrease) in bank loans, net (41,237) (101,461) 60,224
4 Dividends paid (6,440) - (6,440)
5 Purchase of treasury stock (4) - (4)
Net cash provided by (used in) financing activities (13,032) (93,124) 80,092
IV Effect of exchange rate changes on cash and cash equivalents 1,318 (64) 1,382
V Net increase (decrease) in cash and cash equivalents 53,912 (96,076) 149,988
VI Cash and cash equivalents at beginning of period 363,595 454,890 (91,295)
VII Cash and cash equivalents at the end of period 417,507 358,814 58,693
CONSOLIDATED SALES AND OPERATING INCOME BY BUSINESS SEGMENT
(In millions of yen)
FY'04 1st quarter FY'03 1st quarter
April 1-June 30, 2003 (A) April 1-June 30, 2002 (B) A/B
Business Segment Sales (A) % of Operating Sales (B) % of Operating
total income total income
(Loss) (Loss)
Energy and Electric Systems 141,073 17.4 (1,227) 133,780 16.6 (555) 105
Industrial Automation Systems 167,230 20.7 16,164 144,238 17.8 13,416 116
Information and Communication
Systems 149,826 18.5 (1,178) 120,087 14.9 (5,170) 125
Electronic Devices 43,311 5.4 (3,366) 108,029 13.4 (8,986) 40
Home Appliances 195,948 24.2 4,915 174,408 21.6 13,012 112
Others 111,945 13.8 1,160 127,151 15.7 3,460 88
Sub Total 809,333 100.0 16,468 807,693 100.0 15,177 100
Eliminations, others (69,121) - (7,519) (80,817) - (7,452) -
Total 740,212 - 8,949 726,876 - 7,725 102
*Note: Intersegment sales are included in each product segment above.
About Mitsubishi Electric
With over 80 years of experience in providing reliable, high-quality products to
both corporate clients and general consumers all over The world, Mitsubishi
Electric Corporation (TSE: 6503) is a recognized world leader in the
manufacture, marketing and sales of electrical and electronic equipment used in
information processing and communications) space development and satellite
communications, consumer electronics, industrial technology, energy,
transportation and building equipment. The company has operations in 35
countries and recorded consolidated group sales of 3,639 billion yen (US$30.3
billion*) in the year ended March 31, 2003, For more information visit
http://global.mitsubishielectric.com
*At an exchange rate of 120 yen to the US dollar, the rate given by the Tokyo
Foreign Exchange Market on March 31,2003.
Cautionary Statement
The expectation of operating results herein and any associated statement to be
made with respect to Company's current plans, estimates, strategies and beliefs
and any other statements that are not historical facts are forward-looking
statements. Words such as "expects", "anticipates", "plans", "believes",
"scheduled", "estimated", "targeted" along with any variations of these words
and similar expressions are intended to identify forward-looking statements
which include but are not limited to projections of revenues, earnings,
performance and production. While the statements herein are based on certain
assumptions and premises that trusts and considers to be reasonable under the
circumstances to the date of announcement, you arc requested to kindly take note
that actual operating results are subject to change due to any of the factors as
contemplated hereunder and/or any additional factor unforeseeable as of the date
of this announcement.
Such factors materially affecting the expectations expressed herein shall
include but are not limited to the following; (1) Any change in operating
circumstances in any of the markets, in which the Company conducts its business
operation inter alia Japan, the USA and Europe: such change shall include but
not limited to changes in economic situation, political regime, legal system and
legislation, relevant laws and regulations, administrative policies and
practices by any competent authorities, taxation in any of" such markets. (2)
Foreign exchange fluctuations, in particular, the rate of Japanese yen against
US Dollar. (3) Relative disproportion between demand and supply of any products
that may affect price and volume, which could be highly intrusive in such fields
like information, telecommunication, electronic devices and home appliances,
without limitation thereto. (4) Shortage of any devices, components and/or
parts necessary for manufacturing operation and difficulties in material
procurement arising out of such shortage, which could even lead to substantial
disconformity with the operating results as expected herein. Also this factor
could be highly intrusive in such fields as information, telecommunication,
electronic devices and home appliances, without limitation thereto. (5) Any
change in technical and technological trends that may he relevant to businesses
of the Company, including but not limited to IT-based or IT-relaled fields. (6)
Any patent and its licensing that may be granted from time to time and may
affect businesses of the Company. (7) Any development of products incorporating
new technological innovation and the time of their introduction in the
marketplace. (8) Any business alliances of any nature whatsoever, including but
not limited to joint ventures, business transfers, mergers, acquisitions,
capital contributions, technical licensing or co-development. (9) Any change in
fund raising or procurement, inter alia in the Japanese financial market. (10)
Any fluctuation in stock quotations at any relevant markets including securities
exchanges and over-the counter stock markets, inter alia in Japan.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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