RNS Number:2628L
Pioneer Corporation
31 October 2006
For Immediate Release October 31, 2006
Pioneer Announces Business Results for 2Q Fiscal 2007
TOKYO - Pioneer Corporation today announced its consolidated second-quarter and
semiannual business results, and non-consolidated semiannual business results,
for the periods ended September 30, 2006.
Consolidated Financial Highlights
(In millions of yen except per share information)
Three months Six months
ended September 30 ended September 30
2006 2005 % to prior 2006 2005 % to prior
year year
Operating revenue 188,643 179,888 104.9 380,319 339,084 112.2
Operating income (loss) 4,614 (7,733) - 11,691 (16,664) -
Income (loss) from
continuing operations
before income taxes 4,620 (37,481) - 12,624 (44,153) -
Income (loss) from
continuing operations 887 (52,838) - 6,433 (58,207) -
Income from discontinued
operations, net of tax 2,659 137 - 2,775 163 -
Net income (loss) 3,546 (52,701) - 9,208 (58,044) -
Basic net income (loss) per share:
Income (loss) from continuing
operations 5.09 (302.92) 36.88 (333.70)
Income from discontinued
operations, net of tax 15.24 0.78 15.91 0.93
Net income (loss) 20.33 (302.14) 52.79 (332.77)
Diluted net income (loss) per share:
Income (loss) from continuing
operations 4.28 (302.92) 33.15 (333.70)
Income from discontinued
operations, net of tax 14.04 0.78 14.65 0.93
Net income (loss) 18.32 (302.14) 47.80 (332.77)
Note: In fiscal 2006, the Company sold a subsidiary engaged in the development
of cable TV software, and in the second quarter of fiscal 2007, sold
subsidiaries involved in the electronic components business. The operating
results of these subsidiaries and the gain on the sales are presented as income
from discontinued operations in the above table. Previously reported amounts
have been reclassified accordingly.
Consolidated Business Results
For the second quarter of fiscal 2007, the three months ended September 30,
2006, consolidated operating revenue increased 4.9% from the second quarter of
fiscal 2006 to Y188,643 million (US$1,598.7 million), mainly due to higher sales
of plasma displays and car navigation systems, and the weaker yen, despite lower
sales of DVD recorders.
Operating income was Y4,614 million (US$39.1 million), compared with
an operating loss of Y7,733 million in the corresponding period a year earlier.
This reflected higher sales, as well as an improved gross profit margin and
lower selling, general and administrative expenses due to the benefits of
business restructuring measures started in the previous fiscal year and the
weaker yen. Net income totaled Y3,546 million (US$30.1 million), compared with a
net loss of Y52,701 million in the same period in fiscal 2006. This was due to
the absence of impairment losses on property, plant and equipment, equity in
losses of affiliated companies and valuation allowances for deferred tax assets,
which we recorded in connection with business restructuring in the corresponding
period of the previous year, as well as a gain on sale of subsidiaries involved
in the electronic components business in the period under review.
During the second quarter of fiscal 2007, the average value of the
Japanese yen was weaker against the U.S. dollar and the euro by 4.3% and 8.4%,
respectively, compared with the second quarter of fiscal 2006.
Home Electronics sales increased 6.8% year on year to Y87,301 million (US$739.8
million). Plasma display sales rose due to strong performance by our own-brand
models in North America and Europe, despite a drop in OEM (original equipment
manufacturing) sales. Sales of plasma displays accounted for approximately 46%
of total Home Electronics sales. In addition, sales of DVD drives rose, while
there was a large drop in sales of DVD recorders from the same period a year
ago.
In terms of geographic sales, sales in Japan declined 15.1% to Y
16,152 million (US$136.9 million), while overseas sales climbed 13.4% to Y71,149
million (US$603.0 million).
The operating loss in this segment was Y3,848 million (US$32.6
million), showing an improvement compared with an operating loss of Y13,140
million in the corresponding period of the previous fiscal year. In addition to
growth in sales, this improvement principally reflected an increased gross
profit margin mainly in the plasma display field, largely due to the benefits of
business restructuring measures and efforts to strictly control costs and
improve manufacturing efficiency.
Car Electronics sales increased 7.0% to Y83,634 million (US$708.8 million),
mainly due to increased sales of car navigation systems, despite slightly lower
sales of car audio products. In car navigation systems, consumer-market sales
increased in Japan and elsewhere, while OEM sales rose in North America. In car
audio products, consumer-market sales rose in Central and South America, but
fell in Japan and North America. Total OEM sales in this segment accounted for
approximately 35% of Car Electronics sales.
In terms of geographic sales, sales in Japan increased 8.9% to Y
28,564 million (US$242.1 million), and overseas sales rose 6.1% to Y55,070
million (US$466.7 million).
Operating income in this segment increased 92.9% year on year to Y
5,586 million (US$47.3 million) due to sales growth and cost reductions achieved
by reorganizing our production sites.
In Patent Licensing, royalty revenue decreased 88.0% to Y500 million (US$4.2
million). This decrease was mainly attributable to the impact of the expiration
of some patents licensed to the optical disc industry.
Operating income in this segment declined 94.8% to Y187 million
(US$1.6 million) compared with the same period of the previous fiscal year.
In the Others segment, sales rose 8.7% to Y17,208 million (US$145.8 million),
mainly reflecting higher sales of factory automation systems and organic
light-emitting diode (OLED) displays in Japan.
In terms of geographic sales, sales in Japan increased 33.2% to Y
11,262 million (US$95.4 million), while overseas sales declined 19.4% to Y5,946
million (US$50.4 million).
Operating income in this segment was Y2,566 million (US$21.7
million) compared with an operating loss of Y780 million in the corresponding
period of the previous fiscal year. This mainly reflected improved profitability
in OLED displays due to the benefits of business restructuring measures.
For the first half of fiscal 2007, the six months ended September 30, 2006,
consolidated operating revenue rose 12.2% from the first half of fiscal 2006 to
Y380,319 million (US$3,223.0 million). Operating income was Y11,691 million
(US$99.1 million), compared with an operating loss of Y16,664 million in the
corresponding period a year earlier. Net income was Y9,208 million (US$78.0
million), compared with a net loss of Y58,044 million in the same period of
fiscal 2006.
Note: Operating income (loss) in each business segment represents operating
income (loss) before elimination of intersegment transactions.
Cash Flows
During the first half of fiscal 2007, operating activities used net cash of Y
9,855 million (US$83.5 million). This was mainly due to an increase in trade
receivables and inventories of Y42,652 million (US$361.5 million), as well as a
decrease in accrued liabilities of Y7,866 million (US$66.7 million), which were
partially offset by net income of Y9,208 million (US$78.0 million) and
depreciation and amortization of Y18,500 million (US$156.8 million) for this
period. Meanwhile, investing activities used net cash of Y7,758 million (US$65.7
million). Although the sale of subsidiaries provided net cash of Y10,862 million
(US$92.1 million), we used Y20,477 million (US$173.5 million) for capital
expenditures related mainly to car electronics products and plasma displays.
Financing activities provided net cash of Y5,035 million (US$42.7 million),
mainly from an increase in short-term borrowings.
Consequently, cash and cash equivalents at September 30, 2006 were Y
109,822 million (US$930.7 million), Y11,858 million lower than at March 31,
2006.
Dividend Policy
Pioneer positions its dividend policy as one of its highest management
priorities. On the basis of maintaining stable dividends, the Company sets
dividend payments appropriately in light of its financial position, consolidated
business results, and other factors. Retained earnings are effectively used
primarily to develop businesses, as well as reinforce competitiveness and our
management base.
Based on this dividend policy, Pioneer has decided to pay an interim
dividend for fiscal 2007 of Y5.0 (US$0.04) per share of common stock.
Business Forecasts for Fiscal 2007
We revised our consolidated business forecasts for fiscal 2007, ending March 31,
2007, which were announced on July 31, 2006, as follows:
(In millions of yen)
Revised Previous
projections projections
for fiscal 2007 for fiscal 2007 Changes Results
(A) (B) (A- B) for fiscal 2006
Operating revenue 820,000 845,000 (25,000) 754,964
Operating income (loss) 18,000 18,000 0 (16,409)
Income (loss) before income taxes
19,000 19,000 0 (71,165)
Net income (loss) 10,000 7,500 2,500 (84,986)
Our previous operating revenue forecast has been lowered because second-half
sales of plasma displays, DVD recorders and car electronics products are
projected to fall below initial forecasts due to intensifying competition,
falling market prices and other factors.
We have not revised our forecasts for operating income and income
before income taxes mainly in consideration of the impact of the weaker yen and
cost reduction benefits, despite lower operating revenue than forecast
previously. Net income is expected to surpass the previous forecast because we
posted a gain on sale of subsidiaries involved in the electronic components
business in the second quarter of fiscal 2007.
We are assuming average yen-U.S. dollar and yen-euro exchange rates
of Y115 and Y145, respectively, for the revised projections.
Cautionary Statement with Respect to Forward-Looking Statements
Statements made in this release with respect to our current plans, estimates,
strategies and beliefs, and other statements that are not historical facts are
forward-looking statements about our future performance. These statements are
based on management's assumptions and beliefs in light of the
information currently available to it. We caution that a number of important
risks and uncertainties could cause actual results to differ materially from
those discussed in the forward-looking statements, and therefore you should not
place undue reliance on them. It is not our obligation to update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise. We disclaim any such obligation. Risks and uncertainties
that might affect us include, but are not limited to, (i) general economic
conditions in our markets, particularly levels of consumer spending; (ii)
exchange rates, particularly between the yen and the U.S. dollar, euro, and
other currencies in which we make significant sales or in which our assets and
liabilities are denominated; (iii) our ability to continue to design and develop
and win acceptance for our products and services, which are offered in highly
competitive markets characterized by continual new product introductions, rapid
developments in technology, severe price competition and subjective and changing
consumer preferences; (iv) our ability to successfully implement our business
strategies; (v) our ability to compete, as well as develop and implement
successful sales and distribution strategies, in light of technological
developments in and affecting our businesses; (vi) our continued ability to
devote sufficient resources to research and development, and capital
expenditures; (vii) our ability to continuously enhance our brand image; (viii)
the success of our joint ventures and alliances; (ix) the success of our
business restructuring plans; and (x) the outcome of contingencies.
Risk Factors
Business risks that may have an adverse effect on our business results,
financial position and share price include, but are not limited to, the
following:
* Fluctuations in foreign exchange rates, especially the appreciation
of the yen
* Intensified competition with other companies
* Larger-than-anticipated declines in prices for our core products
* Failure of the plasma display market, a main area of focus for us, to
grow as anticipated
* Failure of Blu-ray Disc, a next-generation optical disc format we
have adopted, with the view to gaining broader market acceptance
* Decline in profitability due to a large drop in royalty revenue as a
result of the expiration of many of our existing patents relating to laser
optical disc technologies
* Greater-than-expected contraction of consumer markets for car
electronics products due to growth in OEM markets
* Impact of the growing portable car navigation systems market on
growth in the in-dash car navigation systems market, a main area of focus for us
* Substantial dependence of our OEM business on customer business
performance and other customer-related factors
* Product recalls or successful product liability claims brought
against us, which could result in a significant cost or a negative impact on our
reputation
* Significant reduction in our production capacity which may be caused
by damage to our production facilities due to natural disasters or other events,
as production of certain products is concentrated at specific facilities
Basic Management Policies and Medium-term Business Plan
Pioneer positions customer satisfaction at the core of management. We seek to
offer innovative, high-quality, and value-added electronics products that create
new value for customers, aiming to share the Pioneer Group's philosophy,
"Move the Heart and Touch the Soul," with more people around the
world.
Based on this group philosophy, in April 2006 Pioneer formulated a new group
vision to guide management over the medium term: "To become a company
that encourages all its members to work as a team, with everyone
customer-focused, integrating each one's professionalism in pursuing
innovations one after another." Through this vision, we believe that we
can set a process in motion where employees fulfill their duties from the
customer's perspective, and come up with ideas that resonate with other
employees around them to give rise to major innovations. This innovation will
realize new lifestyle proposals and revolutionary products that change
consumers' ways of life.
Pioneer has also established new numerical targets for the fiscal year ending
March 31, 2009, aiming for operating revenue and operating income of at least
Y950 billion and Y30 billion, respectively, on a consolidated basis. More
specifically, we aim to raise the operating margin to at least 7% in the Car
Electronics business, and to improve operating profitability in the Home
Electronics business, which is still weak, to at least the break-even level.
To attain these targets, we will allocate more resources to the Car Electronics
business to maintain a leading position in consumer markets, while aiming to
drive overall earnings growth across the entire business by further expanding
OEM operations. Meanwhile, production capacity will be ramped up in Thailand and
China to prepare for overall business expansion in this segment.
In the Home Electronics business, we will provide new forms of value
for customers, mainly through plasma displays, in terms of picture quality,
product design, user-friendliness, product quality, and sound. Pioneer aims to
improve the image of its brands, while improving earnings by carefully screening
products based on their profitability.
We remain committed to enhancing our business results by growing
earnings in the Car Electronics business and improving profitability in the Home
Electronics business as quickly as possible.
Issues to Be Addressed
The economic outlook is for stable growth overall, supported by favorable
corporate earnings and consumer spending, despite some concerns over surging
materials prices and slower U.S. economic growth. However, Pioneer faces
extremely challenging business conditions such as price-based competition in its
core products.
In the plasma display business, Pioneer will continue to reduce costs, and
review options for increasing production capacity in response to the higher
forecast demand for plasma displays. In this regard, we are considering all
options, including renovating existing plants through a "Scrap & Build"
approach and joint investments with other companies.
Demand for high-resolution panels is projected to increase in step
with the launch of high-definition (HD) broadcasting, and uptake of HD content
worldwide through media such as Blu-ray Discs. Pioneer will therefore leverage
its technological edge in panel technologies, one of its defining strengths, to
offer outstanding high-resolution plasma displays.
In the optical disc business, Pioneer is focusing on products based on Blu-ray
Disc, a next-generation optical disc format, as well as DVD products. The market
for DVD products is growing, but prices are rapidly falling. In response,
Pioneer will reduce costs through production in China and collaborations with
other companies, and raise the return on product development investments through
external sales of key components. Furthermore, Pioneer is shifting the main
thrust of product development to Blu-ray Disc products, as part of efforts to
improve profitability by offering new value-added proposals.
Turning to the entire Home Electronics business, Pioneer is constructing a new
office in Kawasaki City, Kanagawa Prefecture with the aim of consolidating
planning, development and design departments to generate synergies between
plasma displays and other audio-visual products. Plans call for construction to
be completed in spring 2007.
In the Car Electronics business, specifically in car audio products for consumer
markets, Pioneer is focusing on fast-growing markets such as Central and South
America and Russia in order to retain its position of leadership in these
products. The Company will also offer products that stand apart from those of
other companies by delivering new value and functions. In car navigation systems
for consumer markets, Pioneer will actively press ahead with business expansion
in Europe and North America, as well as in Japan, where Pioneer's car
navigation systems have enjoyed a strong reputation. Aiming to reduce
increasing software development costs accompanying product advancements, Pioneer
is reforming product development processes and pursuing sharing and
standardization in this area.
In the OEM car audio products business, Pioneer aims to make the
most of its strengths in consumer markets to drive further business expansion.
In the OEM car navigation system business, Pioneer is reinforcing efforts in the
growing market for car navigation systems offered as dealer options in Japan. In
parallel, the Company aims to capture new orders by offering new proposals to
OEM customers that leverage our own product planning capabilities, which have
been proven in consumer markets, and the advantages of conducting map-related
content production within its group.
Pioneer Corporation is a leading global manufacturer of consumer- and
business-use electronics products such as audio, video and car electronics. Its
shares are traded on the Tokyo Stock Exchange.
# # # # # #
The U.S. dollar amounts in this release represent translation of Japanese yen,
for convenience only, at the rate of Y118=US$1.00, the approximate rate
prevailing on September 30, 2006.
Attachments:
I. Consolidated financial statements for the three months and the six months
ended September 30, 2006
II. Non-consolidated financial statements for the six months ended September
30, 2006
For further information, please contact:
Investor Relations Department, Corporate Branding and Communications Division
Pioneer Corporation, Tokyo
Phone: +81-3-3495-6773 / Fax: +81-3-3495-4301
E-mail: pioneer_ir@post.pioneer.co.jp
IR Website: http://pioneer.jp/ir-e/
Pioneer Corporation and Subsidiaries
I. CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS AND THE SIX MONTHS ENDED SEPTEMBER 30, 2006
(1) OPERATING REVENUE BY SEGMENT
(In millions of yen)
Three months ended September 30
2006 2005 % to
Amount % to total Amount % to total prior year
Domestic 16,152 8.6 19,028 10.6 84.9
Overseas 71,149 37.7 62,725 34.8 113.4
Home Electronics 87,301 46.3 81,753 45.4 106.8
Domestic 28,564 15.1 26,236 14.6 108.9
Overseas 55,070 29.2 51,904 28.8 106.1
Car Electronics 83,634 44.3 78,140 43.4 107.0
Domestic - - - - -
Overseas 500 0.3 4,162 2.3 12.0
Patent Licensing 500 0.3 4,162 2.3 12.0
Domestic 11,262 6.0 8,455 4.7 133.2
Overseas 5,946 3.1 7,378 4.2 80.6
Others 17,208 9.1 15,833 8.9 108.7
Domestic 55,978 29.7 53,719 29.9 104.2
Overseas 132,665 70.3 126,169 70.1 105.1
Total 188,643 100.0 179,888 100.0 104.9
(In millions of yen)
Six months ended September 30
2006 2005 % to
Amount % to total Amount % to total prior year
Domestic 32,602 8.6 36,068 10.6 90.4
Overseas 138,150 36.3 108,890 32.1 126.9
Home Electronics 170,752 44.9 144,958 42.7 117.8
Domestic 62,882 16.5 56,177 16.6 111.9
Overseas 112,088 29.5 104,176 30.7 107.6
Car Electronics 174,970 46.0 160,353 47.3 109.1
Domestic - - - - -
Overseas 1,761 0.5 5,285 1.6 33.3
Patent Licensing 1,761 0.5 5,285 1.6 33.3
Domestic 21,293 5.6 15,016 4.4 141.8
Overseas 11,543 3.0 13,472 4.0 85.7
Others 32,836 8.6 28,488 8.4 115.3
Domestic 116,777 30.7 107,261 31.6 108.9
Overseas 263,542 69.3 231,823 68.4 113.7
Total 380,319 100.0 339,084 100.0 112.2
(2) CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions of yen)
Three months ended September 30
2006 2005 % to
prior year
Operating revenue:
Net sales 188,143 175,726 107.1
Royalty revenue 500 4,162 12.0
Total operating revenue 188,643 179,888 104.9
Operating costs and expenses:
Cost of sales 142,817 143,257 99.7
Selling, general and administrative expenses 41,212 44,364 92.9
Total operating costs and expenses 184,029 187,621 98.1
Operating income (loss) 4,614 (7,733) -
Other income (expenses):
Interest income 1,136 624 182.1
Foreign exchange loss (986) (320) 308.1
Interest expense (217) (325) 66.8
Other-net 73 (29,727) -
Total other income (expenses) 6 (29,748) -
Income (loss) from continuing operations before
income taxes 4,620 (37,481) -
Income taxes 3,470 (5,347) -
Minority interest in losses (earnings) of subsidiaries (245) 3,601 -
Equity in losses of affiliated companies (18) (24,305) 0.1
Income (loss) from continuing operations 887 (52,838) -
Income from discontinued operations, net of tax 2,659 137 -
Net income (loss) 3,546 (52,701) -
(In millions of yen)
Six months ended September 30
2006 2005 % to
prior year
Operating revenue:
Net sales 378,558 333,799 113.4
Royalty revenue 1,761 5,285 33.3
Total operating revenue 380,319 339,084 112.2
Operating costs and expenses:
Cost of sales 283,384 269,201 105.3
Selling, general and administrative expenses 85,244 86,547 98.5
Total operating costs and expenses 368,628 355,748 103.6
Operating income (loss) 11,691 (16,664) -
Other income (expenses):
Interest income 2,085 1,251 166.7
Foreign exchange loss (385) (1,062) 36.3
Interest expense (616) (720) 85.6
Other-net (151) (26,958) 0.6
Total other income (expenses) 933 (27,489) -
Income (loss) from continuing operations before
income taxes 12,624 (44,153) -
Income taxes 6,214 (6,935) -
Minority interest in losses of subsidiaries 1 4,169 0.0
Equity in earnings (losses) of affiliated companies 22 (25,158) -
Income (loss) from continuing operations 6,433 (58,207) -
Income from discontinued operations, net of tax 2,775 163 -
Net income (loss) 9,208 (58,044) -
(3) CONSOLIDATED BALANCE SHEETS
(In millions of yen)
September 30 March 31
2006 2005 Increase/ 2006 Increase/
(Decrease) (Decrease)
ASSETS
Current assets:
Cash and cash equivalents 109,822 107,198 2,624 121,680 (11,858)
Trade receivables, less allowance 119,106 126,981 (7,875) 107,563 11,543
Inventories 139,030 126,594 12,436 104,226 34,804
Assets held for sale - - - 25,577 (25,577)
Others 70,826 73,878 (3,052) 69,626 1,200
Total current assets 438,784 434,651 4,133 428,672 10,112
Investments and long-term receivables 27,795 25,268 2,527 29,772 (1,977)
Property, plant and equipment,
less depreciation 159,857 171,893 (12,036) 160,231 (374)
Intangible assets 19,482 22,723 (3,241) 20,576 (1,094)
Other assets 42,232 44,518 (2,286) 38,795 3,437
Total assets 688,150 699,053 (10,903) 678,046 10,104
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term borrowings and current
portion of long-term debt 40,270 55,560 (15,290) 30,370 9,900
Trade payables 120,322 104,831 15,491 102,082 18,240
Liabilities held for sale - - - 17,863 (17,863)
Others 116,351 122,463 (6,112) 121,977 (5,626)
Total current liabilities 276,943 282,854 (5,911) 272,292 4,651
Long-term debt 89,225 79,512 9,713 92,970 (3,745)
Other long-term liabilities 25,168 41,225 (16,057) 25,425 (257)
Minority interests 14,056 14,202 (146) 14,109 (53)
Shareholders' equity:
Common stock 49,049 49,049 - 49,049 -
Capital surplus 82,959 82,834 125 82,910 49
Retained earnings 182,162 201,204 (19,042) 173,826 8,336
Accumulated other comprehensive loss (18,964) (39,390) 20,426 (20,092) 1,128
Treasury stock (12,448) (12,437) (11) (12,443) (5)
Total shareholders' equity 282,758 281,260 1,498 273,250 9,508
Total liabilities and
shareholders' equity 688,150 699,053 (10,903) 678,046 10,104
Breakdown of accumulated other
comprehensive loss:
Minimum pension liability adjustments (4,650) (11,391) 6,741 (3,680) (970)
Net unrealized holding gain on securities 9,342 7,475 1,867 10,352 (1,010)
Cumulative foreign currency translation
adjustments (23,656) (35,474) 11,818 (26,764) 3,108
Total accumulated other
comprehensive loss (18,964) (39,390) 20,426 (20,092) 1,128
(4) CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(In millions of yen)
Common Capital Retained Accumulated Treasury Total
Stock Surplus Earnings Other Stock Shareholders
Comprehensive '
Loss Equity
Balance at March 31, 2005 49,049 82,735 260,556 (47,669) (12,432) 332,239
Net loss (84,986) (84,986)
Other comprehensive income 27,577 27,577
Value ascribed to stock options 175 175
Cash dividends (10 per share) (1,744) (1,744)
Purchase and sales of treasury (11) (11)
stock, net
Balance at March 31, 2006 49,049 82,910 173,826 (20,092) (12,443) 273,250
Net Income 9,208 9,208
Other comprehensive income 1,128 1,128
Value ascribed to stock options 49 49
Cash dividends (5 per share) (872) (872)
Purchase and sales of treasury (5) (5)
stock, net
Balance at September 30, 2006 49,049 82,959 182,162 (18,964) (12,448) 282,758
(5) CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions of yen)
Three months Six months
ended September 30 ended September 30
2006 2005 2006 2005
I. Operating activities:
Net income (loss) 3,546 (52,701) 9,208 (58,044)
Depreciation and amortization 9,348 11,575 18,500 24,122
(Increase) decrease in trade receivables 1,765 (15,718) (9,965) 7,160
(Increase) decrease in inventories (15,446) 1,396 (32,687) (14,635)
Increase in trade payables 9,519 5,607 17,184 8,016
Increase (decrease) in other accrued liabilities 8,921 10,822 (7,866) 2,737
Other (3,348) 41,299 (4,229) 31,864
Net cash provided by (used in) operating activities 14,305 2,280 (9,855) 1,220
II. Investing activities:
Payment for purchase of fixed assets (12,157) (10,355) (20,477) (19,282)
Proceed from sale of discontinued operations 10,862 - 10,862 -
Other 1,584 3,354 1,857 7,357
Net cash provided by (used in) investing activities 289 (7,001) (7,758) (11,925)
III. Financing activities:
Increase (decrease) in short-term borrowings
and long-term debt 5,742 (3,183) 7,198 2,866
Dividends paid - - (436) (2,180)
Other (907) (1,034) (1,727) (2,073)
Net cash provided by (used in) financing activities 4,835 (4,217) 5,035 (1,387)
Effect of exchange rate changes on cash
and cash equivalents 1,575 1,366 720 2,609
Net increase (decrease) in cash and cash equivalents 21,004 (7,572) (11,858) (9,483)
Cash and cash equivalents, beginning of period 88,818 114,770 121,680 116,681
Cash and cash equivalents, end of period 109,822 107,198 109,822 107,198
Free cash flow (I + II) 14,594 (4,721) (17,613) (10,705)
(6) SEGMENT INFORMATION
The following segment information is prepared pursuant to the regulations under
the Securities and Exchange Law of Japan.
(In millions of yen)
Three months ended September 30
2006 2005 % to prior year
Operating Operating Operating Operating Operating Operating
Revenue Income Revenue Income Revenue Income
Home Electronics 87,531 (3,848) 82,264 (13,140) 106.4 29.3
Car Electronics 84,124 5,586 78,516 2,896 107.1 192.9
Patent Licensing 500 187 4,201 3,598 11.9 5.2
Others 25,989 2,566 25,099 (780) 103.5 -
Total 198,144 4,491 190,080 (7,426) 104.2 -
Corporate and Eliminations (9,501) 123 (10,192) (307) - -
Consolidated 188,643 4,614 179,888 (7,733) 104.9 -
(In millions of yen)
Six months ended September 30
2006 2005 % to prior year
Operating Operating Operating Operating Operating Operating
Revenue Income Revenue Income Revenue Income
Home Electronics 171,191 (4,245) 145,772 (25,498) 117.4 16.6
Car Electronics 175,913 13,118 161,124 8,210 109.2 159.8
Patent Licensing 1,761 974 5,324 3,969 33.1 24.5
Others 50,224 2,804 47,013 (1,666) 106.8 -
Total 399,089 12,651 359,233 (14,985) 111.1 -
Corporate and Eliminations (18,770) (960) (20,149) (1,679) - -
Consolidated 380,319 11,691 339,084 (16,664) 112.2 -
(In millions of yen)
Six months ended September 30
2006 2005 % to prior year
Operating Operating Operating Operating Operating Operating
Revenue Income Revenue Income Revenue Income
Japan 322,597 5,525 283,600 (15,923) 113.8 -
North America 99,623 4,271 92,524 (1,740) 107.7 -
Europe 80,026 1,528 66,311 (1,315) 120.7 -
Other Regions 175,437 2,862 155,728 3,612 112.7 79.2
Total 677,683 14,186 598,163 (15,366) 113.3 -
Corporate and Eliminations (297,364) (2,495) (259,079) (1,298) - -
Consolidated 380,319 11,691 339,084 (16,664) 112.2 -
Notes:
1. The Company's consolidated financial statements have been prepared in
conformity with accounting principles generally accepted in the United States of
America.
2. The consolidated financial statements include the accounts of the parent
company and 118 subsidiaries and the investments in 3 affiliated companies
accounted for on an equity basis.
3. In fiscal 2006, the Company sold a subsidiary engaged in the development of
cable TV software, and in the second quarter of fiscal 2007, sold subsidiaries
involved in the electronic components business. The operating results of these
subsidiaries and the gain on the sales are presented as income from discontinued
operations in the consolidated statements of operations. Reclassifications have
been made to previously reported operating revenue by segment, consolidated
statements of operations and segment information to conform to this
presentation.
Summarized financial information of the discontinued operations for the three
months and the six months ended September 30, 2005 and 2006 is as follows:
(In millions of yen)
Three months Six months
ended September 30 ended September 30
2006 2005 2006 2005
Operating revenue 2,798 5,827 10,442 10,814
Operating income 151 214 425 276
Income before income taxes 142 221 324 283
Gain on sales of discontinued
operations 2,488 - 2,488 -
Income taxes (29) 84 37 120
Income from discontinued operations 2,659 137 2,775 163
Pioneer Corporation-Parent Company Only
II. NON-CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2006
(1) SALES BY SEGMENT
(In millions of yen)
Six months ended September 30
2006 2005 % to
Amount % to Amount % to prior
total total year
Domestic 28,748 10.6 31,923 13.0 90.1
Export 105,716 39.0 84,303 34.3 125.4
Home Electronics 134,464 49.6 116,226 47.3 115.7
Domestic 62,681 23.2 55,997 22.8 111.9
Export 73,391 27.1 73,053 29.7 100.5
Car Electronics 136,072 50.3 129,051 52.5 105.4
Domestic 338 0.1 494 0.2 68.5
Export 10 0.0 47 0.0 23.0
Others 349 0.1 541 0.2 64.5
Domestic 91,768 33.9 88,416 36.0 103.8
Export 179,118 66.1 157,403 64.0 113.8
Total 270,886 100.0 245,819 100.0 110.2
(2) CONDENSED STATEMENTS OF OPERATIONS
(In millions of yen)
Six months ended September 30
2006 2005
Amount % to Amount % to
net sales net sales
Net sales 270,886 100.0 245,819 100.0
Cost of sales 234,989 86.7 213,720 86.9
Selling, general and administrative expenses 41,825 15.5 41,592 17.0
Operating income (loss) (5,928) (2.2) (9,493) (3.9)
Non-operating income -net 425 0.2 54 0.1
Ordinary income (loss) (5,503) (2.0) (9,439) (3.8)
Other income (expenses)-net 4,381 1.6 357 0.1
Income (loss) before income taxes (1,122) (0.4) (9,081) (3.7)
Income taxes (308) (0.1) 5,679 2.3
Net income (loss) (813) (0.3) (14,761) (6.0)
(3) CONDENSED BALANCE SHEETS
(In millions of yen)
September 30 March 31
2006 2005 2006
ASSETS
Current assets:
Cash 43,289 46,162 50,305
Notes and accounts receivable-trade 49,847 46,605 46,034
Inventories 35,298 29,044 30,015
Other current assets 48,937 31,020 40,105
Total current assets 177,373 152,832 166,461
Fixed assets:
Tangible 56,273 52,674 55,537
Intangible 28,366 28,523 28,752
Investments and others 200,814 199,361 201,979
Total fixed assets 285,454 280,559 286,269
Total assets 462,827 433,392 452,730
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Notes and accounts payable-trade 76,040 53,827 56,175
Accrued expenses 53,505 37,471 61,190
Other current liabilities 42,546 15,350 40,512
Total current liabilities 172,091 106,649 157,879
Long-term liabilities 71,860 73,279 73,351
Total liabilities 243,951 179,929 231,230
Shareholders' equity - 253,463 221,500
Total liabilities and shareholders' equity - 433,392 452,730
Net assets
Shareholders' equity 212,834 - -
Difference of appreciation and conversion 6,041 - -
Total net assets 218,875 - -
Total liabilities and net assets 462,827 - -
(4) STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(In millions of yen)
Shareholders' Equity
Capital Surplus Retained Earnings
Other Retained
Earnings
Common Additional Other Legal Voluntary Retained Treasury Total
Stock Paid-in Capital Reserve Reserves Earnings Stock Shareholders'
Capital Surplus Brought Equity
Forward
Balance at March 31, 49,048 81,278 36 6,140 136,931 (46,902) (12,442) 214,090
2006
Changes in the period:
Issuance of new shares -
Reversal of voluntary (47,800) 47,800 -
reserves
Dividends from surplus (436) (436)
Net income (loss) (813) (813)
Disposal of treasury 0 0 0
stock
Purchase of treasury (7) (7)
stock
Net change of items -
other than shareholders
' equity
Total changes in the - - 0 - (47,800) 46,550 (7) (1,255)
period
Balance at September 49,048 81,278 36 6,140 89,131 (351) (12,449) 212,834
30, 2006
Difference of Appreciation and
Conversion
Net Deferred Total Total
Unrealized Profit Difference of Net Assets
Gains on on Hedges Appreciation
Securities and
Conversion
Balance at March 31, 2006 7,409 - 7,409 221,500
Changes in the period:
Issuance of new shares - -
Reversal of voluntary reserves - -
Dividends from surplus - (436)
Net income (loss) - (813)
Disposal of treasury stock - 0
Purchase of treasury stock - (7)
Net change of items other than (1,120) (247) (1,368) (1,368)
shareholders' equity
Total changes in the period (1,120) (247) (1,368) (2,625)
Balance at September 30, 2006 6,288 (247) 6,041 218,876
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR IIFLDILLLVIR
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