Mitsubishi Electric Announces Consolidated Financial Results for the First 9 Months and Third Quarter of Fiscal 2009 |
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Monday February 02, 2009 |
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Mitsubishi Electric Announces Consolidated Financial Results for the First 9 Months and Third Quarter of Fiscal 2009 TOKYO--(BUSINESS WIRE)--Mitsubishi Electric Corporation (President and CEO: Setsuhiro Shimomura) (TOKYO: 6503) announced today its financial results for the first 9 months and third quarter ending December 31, 2008, of the current fiscal year ending March 31, 2009 (fiscal 2009). 1. Consolidated First 9 Months Results (April 1, 2008 December 31, 2008)
During the first 9 months of fiscal 2009, the downturn in the global economy increased severity in the third quarter of fiscal 2009, with the financial crisis adversely affecting the economy mainly in the United States and Europe, and also starting to spread to economically emerging nations. The Japanese economy is also experiencing a rapid decrease in production and exports. In addition, with the yen becoming stronger against major currencies, management conditions are showing increased severity. Under these circumstances, consolidated net sales for the first 9 months of fiscal 2009 decreased 3% to 2,706.3 billion yen compared to the same period of the previous fiscal year, with decreased sales in the Industrial Automation Systems, the Information and Communication Systems, the Electronic Devices and the Home Appliances segments, etc., despite increased sales in the Energy and Electric Systems segment. Consolidated operating income decreased 13% to 168.5 billion yen compared to the same period of the previous fiscal year due to decreased profit in the Industrial Automation Systems, the Electronic Devices and the Home Appliances segments, etc. despite the Information and Communication Systems segment moving into the black as well as increased profit in the Energy and Electric Systems segment.
The social infrastructure systems business saw increases in both orders and sales compared to the same period of the previous fiscal year due to growth in domestic and overseas power generation business, etc. despite decreases in large projects for public-works and transportation businesses both domestic and overseas. The building systems business experienced decreases in both orders and sales compared to the same period of the previous fiscal year due to a decrease in global demands for elevators and escalators as well as postponements in large projects, etc. As a result, total sales for this segment increased 2% from the same period of the previous fiscal year. Operating income increased from the same period of the previous fiscal year due to increased sales, etc.
The factory automation systems business saw decreases in both orders and sales compared to the same period of the previous fiscal year due to decreases in demand, from the second quarter of fiscal 2009, for industrial machinery in the global market, flat panel display related investments in Korea and Taiwan, as well as domestic surface mounting systems related investments. The automotive equipment business saw decreases in both orders and sales compared to the same period of the previous fiscal year due to a drastic decrease in global demand starting September, despite increases, in the second quarter of fiscal 2009, upheld by Japanese multinational automotive manufacturers. As a result, total sales for this segment decreased by 6% compared to the same period of the previous fiscal year. Operating income decreased compared to the same period of the previous fiscal year decreases in sales, etc.
The telecommunications equipment business saw decreases in both orders and sales compared to the same period of the previous fiscal year due to the termination of the mobile handset business, despite increased orders and sales in the communications infrastructure systems business. The information systems and services business saw an increase in sales from the same period of the previous fiscal year due to growth in our system integration business and operation services business, etc. The electronic systems business saw increases in both orders and sales compared to the same period of the previous fiscal year due to expansion of our electronics business, etc. As a result, total sales for this segment decreased 5% compared to the same period of the previous fiscal year. Operating income increased compared to the same period of the previous fiscal year, owing to the termination of our mobile handset business, etc.
The semiconductors business saw decreases in both orders and sales compared to the same period of the previous fiscal year due to decreases in power amplifiers for domestic mobile handsets, laser diodes for DVD recorders and industrial power modules, etc. The liquid crystal business saw increases in both orders and sales compared to the same period of the previous fiscal year due to an increase in products for consumer use. As a result, total sales for the segment decreased 4% compared to the same period of the previous fiscal year. Operating income decreased compared to the same period of the previous fiscal year due to decreases in sales, etc.
The home appliances business saw a decrease in sales by 3% compared to the same period of the previous fiscal year due to a decrease in air conditioners for some regions in Europe, etc., despite increases in solar power generation systems and heat-pump hot water and heating systems (air-to-water) for the overseas market, as well as increases in domestic heat-pump hot water supply systems, etc. Operating income decreased compared to the same period of the previous fiscal year due to decreases in sales, etc.
Sales decreased 7% compared to the same period of the previous fiscal year mainly in our affiliated companies involved in materials procurement and logistics, etc. Operating income decreased compared to the same period of the previous fiscal year due to decreases in sales, etc. 2. Consolidated Third-Quarter Results (October 1, 2008 December 31, 2008)
Consolidated net sales for the third quarter of fiscal 2009 decreased 11% to 807.9 billion yen compared to the same period of the previous fiscal year, with decreased sales in the Industrial Automation Systems, the Information and Communication Systems, the Electronic Devices and the Home Appliances segments, etc., despite increased sales in the Energy and Electric Systems segment. Consolidated operating income decreased 45% to 35.1 billion yen compared to the same period of the previous fiscal year due to decreased profit in the Industrial Automation Systems, the Electronic Devices and the Home Appliances segments, etc. despite increased profit in the Energy and Electric Systems and the Information and Communication Systems segments. Net income resulted in a deficit of 28.3 billion yen due to loss from an equity method affiliate, etc.
The social infrastructure systems business saw increases in both orders and sales compared to the same period of the previous fiscal year due to growth in domestic and overseas power generation business, etc. The building systems business experienced decreases in both orders and sales compared to the same period of the previous fiscal year due to a decrease in global demands for elevators and escalators as well as postponements in large projects, etc. As a result, total sales for this segment increased 2% from the same period of the previous fiscal year. Operating income increased from the same period of the previous fiscal year due to increased sales, etc.
The factory automation systems business saw decreases in both orders and sales compared to the same period of the previous fiscal year due to decreases in demand for industrial machinery in the global market, flat panel display related investments in Korea and Taiwan, as well as domestic surface mounting systems related investments. The automotive equipment business saw decreases in both orders and sales compared to the same period of the previous fiscal year due to a global downturn in the automotive market. As a result, total sales for this segment decreased 22% compared to the same period of the previous fiscal year. Operating income decreased compared to the same period of the previous fiscal year due to decreases in sales, etc.
The telecommunications equipment business saw decreases in both orders and sales compared to the same period of the previous fiscal year due to the termination of the mobile handset business, despite increased orders and sales in the communications infrastructure systems business. The information systems and services business saw an increase in sales from the same period of the previous fiscal year due to increases in our system integration business and operating services business, etc. The electronic systems business saw increases in both orders and sales compared to the same period of the previous fiscal year due to expansion of our electronics business, etc. As a result, total sales for this segment decreased 7% compared to the same period of the previous fiscal year. Operating income increased compared to the same period of the previous fiscal year, owing to the termination of our mobile handset business, etc.
The semiconductors business saw decreases in both orders and sales compared to the same period of the previous fiscal year due to decreases in power amplifiers for domestic mobile handsets, laser diodes for DVD recorders and industrial power modules, etc. The liquid crystal business saw decreases in both orders and sales compared to the same period of the previous fiscal year due to a decrease in products for industrial use. As a result, total sales for the segment decreased 22% compared to the same period of the previous fiscal year. Operating income became worse compared to the same period of the previous fiscal year due to decreases in sales, etc.
The home appliances business saw a decrease in sales by 10% compared to the same period of the previous fiscal year due to a decrease in air conditioners for some regions in Europe and strong yen, etc., despite increases in heat-pump hot water and heating systems (air-to-water) for the overseas market and domestic heat-pump hot water supply systems, etc. Operating income decreased compared to the same period of the previous fiscal year due to decreases in sales, etc.
Sales decreased by 12% compared to the same period of the previous fiscal year mainly in our affiliated companies involved in materials procurement and logistics, etc. Operating income decreased compared to the same period of the previous fiscal year due to decreases in sales, etc. FINANCIAL CONDITIONS (CONSOLIDATED BASIS) Assets, Liabilities, and Shareholders Equity The companys total assets decreased from the end of the previous fiscal year by 20.9 billion yen to 3,464.1 billion yen. While accounts receivables decreased by 179.8 billion yen due to accelerated collection of our credits, cash and cash equivalents increased by 22.6 billion yen, and inventory increased by 141.8 billion yen due to progress in work-in-processes, etc. The balance of outstanding debts increased by 148.6 billion yen from the end of the previous fiscal year to 699.4 billion yen, with its ratio to total assets rising to 20.2% (an increase by 4.4 point compared to the end of the previous fiscal year). Trade payables decreased by 110.6 billion yen, while retirement and severance benefits increased by 114.0 billion yen due to an increase in deficiency of pension funds, etc. brought on by a decline in stock price, etc. Shareholders equity decreased by 121.5 billion yen compared to the previous fiscal year to 909.8 billion yen, with a ratio of shareholders equity to total assets of 26.3%, a 3.3-point decline compared to the previous fiscal year. Retained earnings increased by 23.2 billion yen due to a 51.1 billion yen net income and a dividend payment of 27.9 billion yen. Accumulated other comprehensive income decreased by 144.6 billion yen due to a decline in stock prices, etc. Cash Flow Cash flows from operating activities for the first 9 months of fiscal 2009 decreased by 8.6 billion yen compared to the same period of the previous fiscal year to 90.2 billion yen (inflow). Meanwhile, investment cash flow for the first 9 months of fiscal 2009 increased by 61.6 billion yen compared to the same period of the previous fiscal year to 148.6 billion yen (outflow) due to increases in capital expenditures, etc. As a result, free cash flow was 58.3 billion yen (outflow). Cash flows from financing activities were 107.4 billion yen (inflow) due to increased loan payables, etc. Forecast for Fiscal 2009 (ending March 31, 2009) While the domestic and overseas economy experienced a rapid downturn beginning in the third quarter of fiscal 2009, this extremely severe economic setback is expected to continue for the meantime. Under the current circumstances, Mitsubishi Electric will revise its consolidated and non-consolidated earnings forecast for fiscal 2009 announced on October 30, 2008 due to an expected downturn in operating profit from decreased sales in the Industrial Automation Systems, the Electronic Devices and Home Appliances segments as well as a downturn in Renesas Technology Corp., an equity method affiliate of Mitsubishi Electric, both affected from conditions exceeding the previous forecast as seen in the stagnation of capital expenditures and durable appliances and also in stronger yen.
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. Please refer to the cautionary statement on the last page.
Cautionary Statement The expectation of operating results herein and any associated statement to be made orally with respect to the Companys 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 the Company trusts and considers to be reasonable under the circumstances to the date of announcement, you are 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) Important trends The Mitsubishi Electric Groups operations may be affected by trends in the global economy, social conditions, laws, tax codes, and regulations. (2) Foreign currency exchange rates Fluctuations in foreign currency markets may affect Mitsubishi Electrics sales of exported products and purchases of imported materials that are denominated in U.S. dollars or euros, as well as its Asian production bases sales of exported products and purchases of imported materials that are denominated in foreign currencies. (3) Stock markets A fall in stock market prices may cause Mitsubishi Electric to record devaluation losses on marketable securities, or cause an increase in retirement benefit obligations in accordance with a decline in the fair value of pension assets. (4) Supply/demand balance for products and procurement conditions for materials and components A decline in prices and shipments due to changes in the supply/demand balance may adversely affect mainly Mitsubishi Electrics Information and Communication Systems, Electronic Devices, and Home Appliances segments. In addition, an increase in material prices due to a worsening of material and component procurement conditions may adversely affect all of Mitsubishi Electrics operations. (5) Fund procurement An increase in interest rates, the yen interest rate in particular, would increase Mitsubishi Electrics interest expenses. (6) Significant patent matters Important patent filings, licensing, copyrights and patent-related disputes may adversely affect related businesses. (7) Environmental matters We may appropriate funds for losses or increase allowances to respond to regulation trends or outbreaks of issues related to the environment. This may impact manufacturing and all corporate activities of the Mitsubishi Electric Group. (8) Quality of products and services We may appropriate funds for losses from defective services or products, and the lowered reputation of the quality of all our products and services may affect the entire Mitsubishi Electric group. (9) Litigation and other legal proceedings The Mitsubishi Electric Groups operations may be affected by lawsuits or other legal proceedings against Mitsubishi Electric, its subsidiaries and/or equity-method affiliated companies. (10) Disruptive changes Disruptive changes in technology, development of products using new technology, timing of production, and market introduction may adversely affect performance mainly in Mitsubishi Electrics Information and Communication Systems, Electronic Devices, and Home Appliances segments. (11) Business restructuring The Mitsubishi Electric Group may record losses due to restructuring measures. (12) Natural disasters The Mitsubishi Electric Groups operations, particularly manufacturing activities, may be affected by the occurrence of earthquakes, typhoons, tsunami, fires and other large-scale disasters. (13) Other significant factors The Mitsubishi Electric Groups operations may be affected by the outbreak of social or political upheaval due to terrorism, war or other factors. Notes (1) Change of status in material affiliates in this quarterly period: none (2) Abbreviated accounting procedures and procedures inherent to compiling quarterly consolidated financial statements: not applicable (3) Changes in principles and procedures of accounting methods for compiling quarterly consolidated financial statements, or in presentation methods, etc.: none 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 (TOKYO: 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 recorded consolidated group sales of 4,049.8 billion yen (US$ 40.5 billion*) in the fiscal year ended March 31, 2008. For more information visit http://global.mitsubishielectric.com *At an exchange rate of 100 yen to the US dollar, the rate given by the Tokyo Foreign Exchange Market on March 31, 2008 |
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