Financial Presentation

Transcription

1 May 2, 217 Financial Presentation (Year ended March 31, 217) This is an English translation of the Japanese original. The translation is prepared solely for the reference and convenience of foreigners. In the event of any discrepancy between this translation and the Japanese original, the latter shall prevail.

2 1. Change in reporting segment classification 2. Management Policies Today s Presentation Goro Yamaguchi Chairman and Representative Director Hideo Tanimoto President and Representative Director 3. Financial Results for the Year Ended March 31, Financial Forecasts for the Year Ending March 31, 218 1

3 1. Change in reporting segment classification Goro Yamaguchi Chairman and Representative Director 2

4 FY3/214-FY3/217 Initiatives from FY3/214 to FY3/217 Strengthen the Group s collective capabilities Reinforce intra-group ties Build sales expansion framework by market Enhance management foundations Improve profitability through structural reforms Restructure businesses in pursuit of synergies Expand sales by growing share and recreate business foundations FY3/218 onward Expand business in core markets under the new management structure toward the next stage of growth 3

5 FY3/217 Components Business Reporting segment classification Fine Ceramic Parts Group Semiconductor Parts Group Applied Ceramic Products Group Electronic Device Group Equipment Business Telecommunications Equipment Group Main business and subsidiaries Fine Ceramic Components Automotive Components Ceramic Packages Organic Packages & PWBs Solar Energy Products Cutting Tools Medical Devices Jewelry and Applied Ceramic Related Products Capacitors Functional Devices Crystal Components Connectors AVX Corporation Printing Devices Liquid Crystal Displays Telecommunications Equipment Information Equipment Group Information Equipment Others Change in reporting segment classification Information systems and Telecommunication Services (KCCS) Optical Components Other subsidiaries etc. FY3/218 onward Components Business Reporting segment classification Industrial & Automotive Components Group Semiconductor Components Group Electronic Devices Group Equipment & Systems Business Communications Group Document Solutions Group Life & Environment Group Others Main business and subsidiaries Fine Ceramic Components Automotive Components Liquid Crystal Displays Cutting Tools Optical Components Ceramic Packages Organic Packages & PWBs Capacitors Functional Devices Crystal Components Connectors AVX Corporation Printing Devices Telecommunications Equipment Information systems and Telecommunication Services (KCCS) Information Equipment Solar Energy Products Medical Devices Jewelry and Applied Ceramic Related Products Other subsidiaries etc. KCCS: Kyocera Communication Systems Co., Ltd. 4

6 2. Management Policies Hideo Tanimoto President and Representative Director 5

7 Career Summary Hideo Tanimoto, President and Representative Director Mar Feb. 27 Apr. 214 Apr. 215 Apr. 216 Jun. 216 Apr. 217 Joined Corporate Fine Ceramics Group, Kyocera Corporation General Manager of Ceramics Division 2, Corporate Fine Ceramics Group General Manager of Corporate Fine Ceramics Group Executive Officer Managing Executive Officer Director President and Representative Director President and Executive Officer 6

8 Basic Policy toward Mid-Term Business Growth Aim to achieve higher growth and higher profitability Information & Communication Automotive Related Environment & Energy Medical & Health Care Exploit collective capability of Kyocera Group Expand sales in core markets Expand existing businesses Create new businesses Thoroughly reduce costs Please refer to forward-looking statements on the final page. 7

9 Management Policy and Major Initiatives Expand existing businesses by extensive cost reductions Cost reduction through process reform Create new businesses by strengthening internal and external collaboration Strengthen internal synergies in technologies Double productivity utilizing robotics and IT, etc. Utilize external resources including M&A Aim for early realization of 2 trillion yen in sales Please refer to forward-looking statements on the final page. 8

10 3. Financial Results for the Year Ended March 31, 217 9

11 Financial Results for the Year Ended March 31, 217 (Unit: Yen in millions) Years ended March 31, Change Amount % to net sales Amount % to net sales Amount % Net sales Profit from operations Pre-tax income Net income attributable to shareholders of Kyocera Corporation EPS (Diluted-yen) Capital expenditures Depreciation R&D expenses 1,479,627 1.% 1,422,754 1.% -56, % 92, % 14, % 11, % 145, % 137, % -7, % 19,47 7.4% 13, % -5,24-4.8% , % 67, % -1, % 65, % 66,19 4.6% 166.3% 58,755 4.% 55, % -3, % Average exchange rate (yen) US$ Euro Foreign currency fluctuation effect on;(compared with the previous same period) Net sales Pre-tax income Approx. 29 billion Approx. 4 billion Approx. -94 billion Approx. -26 billion 1

12 11 (Unit: Yen in millions) Amount % of net sales Amount % of net sal es Amount % Fine Ceramic Parts Group 95,92 6.4% 97, % 2, % Semiconductor Parts Group 236, % 245, % 9,462 4.% Applied Ceramic Products Group 247, % 225, % -22,34-9.% Electronic Device Group 29, % 288, % -2, % 869, % 856, % -12, % Telecommunications Equipment Group 17, % 145, % -25, % Information Equipment Group 336, % 324, % -12, % Equipment Business 57, % 469, % -37, % Others 146, % 138, % -8, % Adjustments and eliminations -44,336-3.% -42, % 2,175 - Net sales Sales by Reporting Segment for the Year Ended March 31, 217 Components Business Years ended March 31, Change 1,479,627 1.% 1,422,754 1.% -56, % Note: Kyocera Chemical Group, formerly included in Others until the year ended March 31, 216, has been reclassified and included in the Semiconductor Parts Group commencing from the year ended March 31, 217. Due to this change, results for the year ended March 31, 216 have been reclassified to conform to the current presentation.

13 Operating Profit by Reporting Segment for the Year Ended March 31, 217 (Unit: Yen in millions) Amount % to net sales Amount % to net sal es Amount % Fine Ceramic Parts Group 15, % 14, % -1, % Semiconductor Parts Group 42, % 25, % -16, % Applied Ceramic Products Group 16, % 15, % % Electronic Device Group 1, % 3,61 1.4% 19, % Components Business 85, % 85,874 1.% 537.6% Telecommunications Equipment Group -4,558-1,84.7% 5,642 - Information Equipment Group 27,16 8.1% 28,8 8.7% % Equipment Business 22, % 29, % 6, % Others -1, ,178 - Operating profit Corporate and others Pre-tax income Years ended March 31, Change 16, % 114,494 8.% 8, % 39,42-23, ,65-4.8% 145, % 137, % -7, % Notes (1) Refer to Note on page 11. (2) As a result of the aforementioned note (1), a gain of approximately 12 billion from the sale of assets was included in the Semiconductor Parts Group for the year ended March 31, 216. Operating profit represents combined pre-tax income of all reporting segments. 12

14 Sales Fine Ceramic Parts Semiconductor Parts Summary of FY3/217 Results - Components Business - Applied Ceramic Products Electronic Device (Unit : Yen in billions) <Major factors for changes> Sales were down slightly due to a decline in sales in the Applied Ceramic Products Group following lower revenue in the solar energy business, despite sales growth in the Fine Ceramic Parts Group and the Semiconductor Parts Group FY3/216 FY3/217 Operating Profit (Unit : Yen in billions) Operating profit remained roughly unchanged due to the effect of cost reductions, despite the negative impact of the yen s appreciation FY3/ FY3/217 The recording of costs such as impairment losses on goodwill and long lived assets in addition to the gain on the sale of an asset in FY3/216 *1. Includes approx. 12bn in gain on the sale of an asset in the Semiconductor Parts Group *2. Includes approx. 18bn in impairment losses on goodwill and long lived assets in the Electronic Device Group 13

15 Summary of FY3/217 Results - Equipment Business - Sales Telecommunications Equipment (Unit : Yen in billions) <Major factors for changes> Sales were down due to a decline in sales volume in line with a review of product strategy for the Telecommunications Equipment Group Information Equipment FY3/216 FY3/217 Operating Profit (Unit : Yen in billions) Operating profit increased due to the effect of structural reform for the Telecommunications Equipment Group, including a shift to highdurability models and integration of production and development sites coupled with a reduction in costs in the Information Equipment Group FY3/216 FY3/217 14

16 4. Financial Forecasts for the Year Ending March 31,

17 Financial Forecasts for the Year Ending March 31, 218 (Unit: Yen in millions) Year ended March 31, Year ending March 31, Change Amount % to net sales Amount % to net sales Amount % Net sales Profit from operations Pre-tax income Net income attributable to shareholders of Kyocera Corporation EPS (Diluted-yen) Capital expenditures Depreciation R&D expenses 1,422,754 1.% 1,5, 1.% 77, % 14, % 12, 8.% 15, % 137, % 15, 1.% 12, % 13, % 15, 7.% 1, % , % 8, 5.3% 12, % 66,19 4.6% 75, 5.% 8, % 55, % 6, 4.% 4, % Average exchange rate (yen) US$ Euro Foreign currency fluctuation effect on;(compared with the previous same period) Net sales Pre-tax income Approx. -94 billion Approx. -26 billion Approx billion Approx. -4. billion Notes: Forecast of EPS (Diluted-yen) is computed based on the diluted average number of shares outstanding during the year ended March 31, 217. Please refer to forward-looking statements on the final page. 16

18 Sales Forecast by Reporting Segment Year ended March 31, 217 Year ending March 31, 218 (Unit: Yen in millions) Change Amount % of net sales Amount % of net sales Amount % Industrial & Automotive Components Group 23, % 246, 16.4% 15, % Semiconductor Components Group 245, % 248, 16.5% 2,273.9% Electronic Devices Group 24, % 254, 17.% 13,22 5.5% Components Business 716, % 748, 49.9% 31, % Communications Group 252, % 269, 17.9% 16, % Document Solutions Group 324, % 35, 23.4% 25,988 8.% Life & Environment Group 149,27 1.5% 153, 1.2% 3, % Equipment & Systems Business 725,86 51.% 772, 51.5% 46,14 6.4% Others 22,66 1.5% 16, 1.% -6, % Adjustments and eliminations -41, % -36, -2.4% 5,926 - Net Sales 1,422,754 1.% 1,5, 1.% 77, % Note: Business results for the year ended March 31, 217 have been reclassified in line with the change to reporting segment classifications. Please refer to forward-looking statements on the final page. 17

19 Operating Profit Forecast by Reporting Segment (Unit: Yen in millions) Year ended March 31, 217 Year ending March 31, 218 Change Amount % to net sales Amount % to net sales Amount % Industrial & Automotive Components Group 22, % 26, 1.6% 3, % Semiconductor Components Group 25,31 1.3% 26, 1.5% % Electronic Devices Group 3, % 33, 13.% 2,442 8.% Components Business 78,31 1.9% 85, 11.4% 6,69 8.5% Communications Group 8, % 13, 4.8% 4, % Document Solutions Group 28,8 8.7% 35, 1.% 6, % Life & Environment Group 1,345.9% 3, 2.% 1, % Equipment & Systems Business 37, % 51, 6.6% 13, % Others -1, , - -1,241 - Operating Profit 114,54 8.% 133, 8.9% 18, % Corporate and Others 23,345-17, - -6, % Pre-tax income 137, % 15, 1.% 12, % Note: Business results for the year ended March 31, 217 have been reclassified in line with the change to reporting segment classifications. Please refer to forward-looking statements on the final page. 18

20 Financial Forecasts by Reporting Segment (1) Sales Operating profit Operating profit ratio ( ) Change from FY3/217 (%),,5,,5, 5,,5,,5, 5 Industrial & Automotive Components Group (+6.9%) (Unit: Yen in billions) 9.7% 1.6% (+15.9%) FY3/217 FY3/218 (Forecast) Semiconductor Components Group (+.9%) 1.3% 1.5% (+2.7%) FY3/217 FY3/218 (Forecast) (Unit: Yen in billions) <Major factors for changes> Sales to increase in core products due to brisk production activities in semiconductor processing equipment and automotive-related markets Profit to increase due to sales growth in high-valueadded products Sales to increase slightly due to sales growth in ceramic packages for communications infrastructure and smartphones, despite a decline in sales of organic materials business due to a review of product line-up Profit to increase due to improvement in product mix and cost reductions Please refer to forward-looking statements on the final page. 19

21 Financial Forecasts by Reporting Segment (2) Sales Operating profit Operating profit ratio ( ) Change from FY3/217 (%) 3, 2,5 2, 1,5 1, 5 Electronic Devices Group (Unit: Yen in billions) (+5.5%) 12.7% 13.% (+8.%) <Major factors for changes> Sales to increase in electronic components for smartphones and printing devices for industrial equipment Profit to increase on the back of sales growth FY3/217 FY3/218 (Forecast) 3,5 3, 2,5 2, 1,5 1, 5 Communications Group (Unit: Yen in billions) (+6.5%) 3.4% 4.8% (+52.4%) FY3/217 FY3/218 (Forecast) Sales to increase through new product introductions for mobile phones and sales growth in ICT and engineering businesses Profit to increase following sales growth and improvement in profitability in telecommunications equipment business Please refer to forward-looking statements on the final page. 2

22 Financial Forecasts by Reporting Segment (3) Sales Operating profit Operating profit ratio ( ) Change from FY3/217 (%) 4,5 4, 3,5 3, 2,5 2, 1,5 1, 5 2, 1,5 1, Document Solutions Group % 28.1 FY3/217 Life & Environment Group (+2.5%).9% 1.3 FY3/217 FY3/218 (Forecast) FY3/218 (Forecast) (Unit: Yen in billions) (+8.%) 1.% 35. (+24.6%) 3.(+123.%) (Unit: Yen in billions) 2.% <Major factors for changes> Sales to increase due to active sales expansion of new products and to expand solution business Profit to increase on the back of the effect of sales growth coupled with cost reductions and enhanced productivity Sales to increase due to an expansion in sales of solar power generating related business in Japan and Asia coupled with sales growth in the medical devices business Profit to increase through sales growth and cost reductions Please refer to forward-looking statements on the final page. 21

23 Dividend Forecast Dividend Policy based on payout ratio 3% or more Around 4% Payout ratio Dividend per share (yen) 38.9% 38.5% 33.1% 31.7% 33.6% FY3/214 FY3/215 FY3/216 FY3/217 FY3/218 (Forecast) Please refer to forward-looking statements on the final page. 22

24 6, 4, 2,, Sales Pre-tax income Pre-tax income ratio 1,447.4 Trend of Sales and Pre-tax Income Record High 1, , ,422.8 Enhance management foundations 1,5. (Unit: Yen in billions) 3, Strengthen production to drive a new stage of growth 8, , 4, 1.1% 8.% 9.8% 9.7% 1.% 2, FY3/214 FY3/215 FY3/216 FY3/217 FY3/218(Forecast) 214/3 215/3 216/3 217/3( 見通し ) FY18(MP) Please refer to forward-looking statements on the final page. 23

25 Certain of the statements made in this document are forward-looking statements (within the meaning of Section 21E of the U.S. Securities and Exchange Act of 1934), which are based on our current assumptions and beliefs in light of the information currently available to us. These forward-looking statements involve known and unknown risks, uncertainties and other factors. Such risks, uncertainties and other factors include, but are not limited to the following: (1) general conditions in the Japanese or global economy; (2) unexpected changes in economic, political and legal conditions in countries where we operate; (3) various export risks which may affect the significant percentage of our revenues derived from overseas sales; (4) the effect of foreign exchange fluctuations on our results of operations; (5) intense competitive pressures to which our products are subject; (6) fluctuations in the price and ability of suppliers to provide the required quantity of raw materials for use in Kyocera s production activities; (7) manufacturing delays or defects resulting from outsourcing or internal manufacturing processes; (8) shortages and rising costs of electricity affecting our production and sales activities; (9) the possibility that future initiatives and in-process research and development may not produce the desired results; (1) companies or assets acquired by us not produce the returns or benefits, or bring in business opportunities; (11) inability to secure skilled employees, particularly engineering and technical personnel; (12) insufficient protection of our trade secrets and intellectual property rights including patents; (13) expenses associated with licenses we require to continue to manufacture and sell products; (14) environmental liability and compliance obligations by tightening of environmental laws and regulations; (15) unintentional conflict with laws and regulations or newly enacted laws and regulations; (16) our market or supply chains being affected by terrorism, plague, wars or similar events; (17) earthquakes and other natural disasters affecting our headquarters and major facilities as well as our suppliers and customers; (18) credit risk on trade receivables; (19) fluctuations in the value of, and impairment losses on, securities and other assets held by us; (2) impairment losses on long-lived assets, goodwill and intangible assets; (21) unrealized deferred tax assets and additional liabilities for unrecognized tax benefits; (22) changes in accounting principles; Forward-Looking Statements Such risks, uncertainties and other factors may cause our actual results, performance, achievements or financial condition to be materially different from any future results, performance, achievements or financial condition expressed or implied by these forward-looking statements. We undertake no obligation to publicly update any forward-looking statements included in this document.