Post on 22-Apr-2015
description
Pioneer Corporation
Business Resultsfor Third Quarter of Fiscal 2014
Susumu Kotani, President and CEOFebruary 12, 2014
1. Business Results for Third Quarter of FY2014: Operating income in the third quarter exceeded our
projection. On a year-on-year basis, net sales increased and operating income returned to profitability.
2. Business Forecasts for FY2014: Forecasts for the full year (net sales of 505.0 billion yen,
operating income of 10.0 billion yen, and net income of 0.5 billion yen) are unchanged.
Main Points of Today’s Presentation2
Today’s Agenda
3
1. Business Results for Third Quarter of FY20142. Business Forecasts for FY2014
Cautionary Statement with Respect to Forward-Looking StatementsStatements made in this presentation 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, and levels of demand in the major industrial sectors which we serve; (ii) exchange rates, particularly between the Japanese yen and the euro, the U.S. dollar, and other currencies in which we make significant sales or in which our assets and liabilities are denominated; (iii) our ability to continuously design and develop and win acceptance for our products in extremely competitive markets; (iv) our ability to successfully implement our business strategies; (v) the success of our joint ventures, alliances and other business relationships with third parties; (vi) our ability to access funding; (vii) our continued ability to devote sufficient resources to research and development, and capital expenditure; (viii) our ability to ensure the quality of our products; (ix) conditions in which we are able to continuously procure key parts essential to our manufacturing operations; and (x) the outcome of contingencies.
4
1. Business Results for Third Quarter of FY2014
(billion yen)
Consolidated Results for Third Quarter & Nine Months of FY2014
5
Third Quarter Nine Months
FY2014 Prior Year % to Prior Year FY2014 Prior Year % to Prior
Year
Net Sales 126.3 104.5 120.8% 362.6 329.1 110.2%
Operating Income/Loss 2.8 -1.8 - 3.3 1.4 240.5%
Ordinary Loss -0.1 -2.9 - -2.1 -2.1 -
Net Loss -1.7 -2.3 - -6.7 -9.8 -
AverageCurrency
Rate
1 US$ 100.46 81.17 +19.2% 99.39 80.00 +19.5%
1 Euro 136.69 105.25 +23.0% 132.23 102.17 +22.7%
Net Loss per Share -4.76 -7.03 +2.27 -19.01 -30.39 +11.38
ROE -8.2% -11.7% +3.5% -10.9% -15.8% +4.9%
Book-value per Share 238.46 249.53 -11.07
ROA -2.1% -2.9% +0.8% -2.7% -4.1% +1.4%
(yen)
(yen)
Operating Income/Loss Structure Breakdown for 3Q, Compared to FY13/3Q
(billion yen)
Increase of 4.5 billion yenFY13/3Q
OperatingLoss
FY14/3QOperating
Income
Improvement in Cost of Sales
Ratio
Impact ofCurrency Exchange
Increase inSG&A
6
-1.8 +0.5 -0.6 +2.8-0.4
Higher Profit Due to Increase
in Net Sales
+1.7 +3.4
Reduction of Fixed Costs
through Restructuring Measures
OEM Ratio to Net Sales: 54% (FY13/3Q: 52%)< Net Sales >
% to Prior Year 126% (Japan 119%, Overseas 131%)
Increase Factors OEM car audio products, consumer-market car audio products, OEM car navigation systems, and consumer-market car navigation systems
< Operating Income >
Year-on-Year Increase of 2.1 billion yen
Positive Factors Higher profit due to increase in net sales (+1.8 billion yen), and improvement in cost of sales ratio (+1.7 billion yen)
Negative Factors Impact of currency exchange (-1.1 billion yen), and increase in SG&A (-0.2 billion yen)
Note : Operating income by segment represents figures prior to elimination of transactions among segments.
Main products are:Car navigation systems, Car stereos, Car AV systems, and Car speakers.
Quarterly Net Sales & Operating Income: Car Electronics
Net Sales
Operating Income
(billion yen)
FY13/3Q FY14/3Q
49.8Overseas
38.1
36.3
Japan30.5
68.6
86.2
0.6 2.7
7
Overseas17.9
21.4
Japan6.9
8.0
29.4
24.8
0.4
-1.7
Main products are:Audio systems, Audio components, DJ equipment,Equipment for cable-TV systems, Blu-ray Disc players, Blu-ray Disc drives, DVD players, DVD drives, and AV accessories.
< Net Sales >
% to Prior Year 118% (Japan 116%, Overseas 119%)
Increase Factors DJ equipment, and equipment for cable-TV systems
Decrease Factor Optical disc drive-related products
< Operating Income/Loss >
Decrease in SG&A (+1.6 billion yen), impact of currency exchange (+0.5 billion yen), and higher profit due to increase in net sales (+0.1 billion yen)
Positive Factors
Year-on-Year Improvement of 2.1 billion yen
Negative Factor Worsening of cost of sales ratio (-0.1 billion yen)
Quarterly Net Sales & Operating Income/Loss: Home Electronics
8
Net Sales
(billion yen)
FY13/3Q FY14/3Q
Note : Operating income/loss by segment represents figures prior to elimination of transactions among segments.
Operating Income/Loss
Main products and services are:Factory automation systems, Speaker units, Electronic devices and parts, Organic light-emitting diode displays, Telephones, Business-use AV systems, Electronic manufacturing services (EMS), Map software, and Licensing of patents related to laser optical disc technologies.
< Net Sales >
% to Prior Year 97% (Japan 98%, Overseas 94%)
Increase Factor Electronic devices and parts
Decrease Factors Factory automation systems, and EMS
Year-on-Year Improvement of 0.4 billion yen
Positive Factor Improvement in cost of sales ratio (+0.6 billion yen)
Negative Factors Increase in SG&A (-0.2 billion yen), and lower profit due to decrease in net sales (-0.1 billion yen)
Quarterly Net Sales & Operating Loss: Others
9
Operating Loss
Net Sales
(billion yen)
FY13/3Q FY14/3Q
Note : Operating loss by segment represents figures prior to elimination of transactions among segments.
< Operating Loss >
Overseas3.7 3.5
Japan7.4
7.2
10.711.1
-0.4-0.8
FY14/3Q compared to prior yearYen basis: 119%Local currency basis: 93%
Increase FactorsConsumer-market car audio products, DJ equipment, AV systems, and audio components
Decrease FactorDVD players
(billion yen)
FY14/3Q compared to prior yearYen basis: 119%Local currency basis: 97%
Increase FactorsCar audio products bothin consumer market and OEM, audio components, and DJ equipment
Decrease FactorMap software
FY14/3Q compared to prior year115%
Increase FactorsOEM car navigation systems, OEM car audio products, opticaldisc drive-related products, andequipment for cable-TV systems
Decrease FactorFactory automation systems
FY14/3Q compared to prior yearYen basis: 134%Local currency basis: 113%
Increase FactorsCar audio products bothin consumer market and OEM, electronic devices and parts,and DJ equipment
Decrease FactorOptical disc drive-related products
Quarterly Net Sales by Geographic Segment
10
North AmericaJapan
Europe Other Regions
51.644.8
0
20
40
60
80
FY13/3Q FY14/3Q
17.514.7
0
10
20
30
FY13/3Q FY14/3Q
25.221.1
0
10
20
30
FY13/3Q FY14/3Q
32.023.8
0
10
20
30
40
FY13/3Q FY14/3Q
11
(billion yen)
Third Quarter of FY2014: Summary of Consolidated Statements of Cash Flows
Third Quarter Nine Months
FY2014 FY2013 FY2014 FY2013Income (loss) before income taxes and minority interests -0.4 -1.8 -3.3 -7.5
Depreciation and amortization 6.4 6.5 18.9 18.8
Increase (decrease) in accrued pension and severance costs 0.2 -0.1 0.7 0.9
Decrease in provision forrestructuring costs - - -6.2 -
Loss (gain) on impairment of investment securities - -1.1 - 4.7
Decrease (increase) in trade receivables 6.0 9.1 2.5 15.0
Decrease (increase) in inventories -5.2 -6.7 -3.1 -18.5
Increase (decrease) in trade payables -0.3 -4.6 20.7 -12.6
Increase (decrease) in accrued expenses 1.2 -7.2 -0.2 -6.5
Others 1.6 2.9 -4.1 4.1
Cash flows from operating activities 9.5 -2.9 25.9 -1.6
Cash flows from investing activities -6.3 -5.7 -18.6 -24.0
Cash flows from financing activities -0.4 5.1 6.6 8.7
Foreign currency translation adjustments on cash and cash equivalents 1.5 2.1 2.0 0.6
Free cash flows 3.2 -8.6 7.3 -25.7
Net increase/decrease in cash and cash equivalents 4.3 -1.4 16.0 -16.4
Balance of cash and cash equivalents 36.9 29.5
Net cash balance -57.9 -67.2
9.5
5.3
11.2
2.8
-2.9
-6.3
-5.8
-6.5
-11.
2
-5.7
3.2
-8.6 -8.4
4.7
-0.5
FY13/3Q FY13/4Q FY14/1Q FY14/2Q FY14/3Q
Cash Flows from Operating Activities
Cash Flows from Investing Activities
Free Cash Flows
Third Quarter of FY2014: Inventories
12
(billion yen)
(turnover days)
75.678.1 84.776.588.3
5660
64
53
76
'12/12 '13/03 '13/06 '13/09 '13/12
144.7Overseas
118.4
109.0
Japan109.2
227.6
253.7
8.7
5.6
0
100
200
300
0
10
20
13
0
Note : Operating income/loss by segment represents figures prior to elimination of transactions among segments.
Nine Months of FY2014 : Net Sales & Operating Income/Loss by Segment
Car Electronics Home Electronics Others(billion yen)
Net Sales
Operating Loss
Net Sales
Operating Income
Net Sales
Operating Loss
56.9Overseas
47.1
21.7
Japan22.0
69.0
78.6
-4.7-0.6
-20
20
60
100
-5
5
15
25
11.2Overseas
12.9
19.1 Japan
19.6
32.530.3
-1.5 -1.4
-10
10
30
50
-2
2
6
10
0 0 0
FY131-3Q
FY141-3Q
FY131-3Q
FY141-3Q
FY131-3Q
FY141-3Q
2. Business Forecasts for FY2014
14
293.0292.0Overseas250.1
212.0213.0Japan201.7
505.0
451.8
505.0
10.0
6.010.0
FY13Results
FY14PreviousForecasts
FY14Current
Forecasts
15
Consolidated Business Forecasts for FY2014
Forecasts Prior-yearResults
% to Prior Year
Net Sales 505.0 451.8 111.8%
Operating Income 10.0 6.0 166.8%
Ordinary Income 5.0 0.8 615.8%
Net Income/Loss 0.5 -19.6 -
Forecasts Prior-yearResults
CurrencyRate
1 US$ 100 83.10
1 Euro 135 107.14
Forecasts Prior-yearResults
To Prior Year
Net Income/Loss per Share 1.42 -60.90 +62.32
ROE 0.6% -24.4% +25.0%
Book-value per Share 217.17 237.97 -20.80
ROA 0.2% -6.2% +6.4%
(yen)
Note :In case of 1 yen depreciation against US$ and euro, remaining 3 months impact on: Net sales: US$: 620 million yen / euro: 130 million yen; Operating income: US$: -160 million yen / euro: 60 million yen.
(billion yen)
Net Sales
Operating Income
To Achieve Fourth Quarter Projections
16
Fourth quarter projections: net sales of 142.4 billion yen and operating income of 6.7 billion yen
(+) - Increased Car Electronics sales, reflecting special demand before the April 2014 consumption tax increase in Japan, and solid sales of high-margin consumer-market car audio products, mainly in emerging markets
- Increased sales of high-margin DJ equipment from release of new products
- Reduction of fixed costs through restructuring
(-) - Weak demand for optical disc drive-related products from effect of market contraction
Operating Income Structure Breakdown for 4Q, Compared to FY13/4Q
+4.6 +3.0 +2.7 -0.5 +6.7-6.8 +3.6
17
Improvement inCost of Sales
Ratio
Impact ofCurrency Exchange
Increase inSG&A
Higher Profit Due to Increase
in Net Sales
Reduction of Fixed Costs
through Restructuring Measures
Increase of 2.1 billion yenFY13/4Q
Operating IncomeResult
FY14/4QOperating Income
Forecast
(billion yen)
+2.8 +3.6 +2.7 -0.0 +6.7-2.6 +0.2
Operating Income Structure Breakdown for 4Q, Compared to FY14/3Q
18
Improvement inCost of Sales
Ratio
Impact ofCurrency Exchange
Increase inSG&A
Higher Profit Due to Increase
in Net Sales
Reduction of Fixed Costs
through Restructuring Measures
(billion yen)
Increase of 3.9 billion yenFY14/3Q
Operating IncomeResult
FY14/4QOperating Income
Forecast
Forecasts for FY2014: Car Electronics(billion yen)
OEM Ratio to Net Sales: 54% (FY13: 51%)< Net Sales >
% to Prior Year 113% (Japan 105%, Overseas 119%)
Increase Factors OEM car navigation systems, and car audio products both in OEM and consumer market
Net Sales
Year-on-Year Increase of 0.2 billion yen
Positive Factors Higher profit due to increase in net sales (+1.9 billion yen), and improvement in cost of sales ratio (+0.8 billion yen)
Negative Factors Increase in SG&A (-1.3 billion yen), and impact of currency exchange (-1.3 billion yen)
< Operating Income >
FY13Results
FY14 Current Forecasts
Car navigation systems 904 835
Car CD players 8,043 8,150
(thousand units)< Shipment to Consumer Market >
Note : Operating income by segment represents figures prior to elimination of transactions among segments.
Operating Income
200.0199.0Overseas167.6
152.0153.0
Japan145.0
312.6
352.0352.0
(5.0)10.09.8 10.0
FY13Results
FY14PreviousForecasts
FY14Current
Forecasts
Restructuring Effect
19
Overseas65.4
75.7 76.8
32.233.3
Japan30.5
109.0 109.0
95.9
(3.0)1.0
-2.8
1.0
Forecasts for FY2014: Home Electronics
Net Sales
(billion yen) < Net Sales >
% to Prior Year 114% (Japan 106%, Overseas 117%)
Increase Factors DJ equipment, equipment for cable-TV systems, and home AV products
Decrease Factor Optical disc drive-related products
< Operating Income/Loss >
Year-on-Year Improvement of 3.8 billion yen
Positive Factors Improvement in cost of sales ratio (+2.6 billion yen), and impact of currency exchange (+1.9 billion yen)
Negative Factors Lower profit due to decrease in net sales (-0.6 billion yen), and increase in SG&A (-0.1 billion yen)
Note : Operating income/loss by segment represents figures prior to elimination of transactions among segments.
Operating Income/Loss
FY13Results
FY14PreviousForecasts
FY14Current
Forecasts
Restructuring Effect
20
Forecasts for FY2014: Others
FY14 PreviousForecasts
(billion yen)
Net Sales
Note : Operating loss by segment represents figures prior to elimination of transactions among segments.
< Net Sales >
% to Prior Year 102% (Japan 106%, Overseas 95%)
Increase Factors Electronic devices and parts, and speaker units
Decrease Factors Factory automation systems, and EMS
< Operating Loss >
Year-on-Year Worsening of 0.1 billion yen
Positive Factor Electronic devices and parts
Negative Factors Factory automation systems, and map software
Operating Loss
FY13Results
FY14 Current
Forecasts
16.217.3Overseas
17.1
Japan26.3
26.7 27.8
43.3 44.044.0
(1.0)
-1.0-0.9 -1.0
Restructuring Effect
21
127.5106.0
0
50
100
150
FY13Results
FY14Current
Forecasts
65.554.4
0
20
40
60
80
FY13Results
FY14Current
Forecasts
89.7100.0
0
50
100
FY13Results
FY14Current
Forecasts
212.0201.7
0
100
200
300
FY13Results
FY14Current
Forecasts
(billion yen)
Forecasts for FY2014: Net Sales by Geographic Segment
North AmericaJapan
Europe Other Regions
FY14 compared to prior yearYen basis: 112%Local currency basis : 94%
Increase FactorsCar audio products bothin consumer market and OEM, OEM car navigationsystems, and DJ equipment
Decrease FactorHome AV products
FY14 compared to prior year105%
Increase FactorsOEM car navigation systems, OEM car audio products, and equipment for cable-TVsystems
Decrease FactorsConsumer-market car navigation systems, and optical disc drive-related products
FY14 compared to prior yearYen basis: 120%Local currency basis : 104%
Increase FactorsCar audio products both in consumer market and OEM,OEM car navigation systems,DJ equipment, and home AV products
Decrease FactorOptical disc drive-related products
FY14 compared to prior yearYen basis: 120%Local currency basis: 100%
Increase FactorsCar audio products both in consumer market and OEM,DJ equipment, and home AVproducts
Decrease FactorNot applicable
22
24.822.123.830.0
35.0(19.7)
FY10Result
FY11Result
FY12Result
FY13Result
FY14Current
Forecast
24.629.839.3 25.427.0(18.9)
FY10Result
FY11Result
FY12Result
FY13Result
FY14Current
Forecast
36.0 33.0 34.6 33.730.0(19.4)
5.97.5
8.27.2 7.9
FY10Result
FY11Result
FY12Result
FY13Result
FY14Current
Forecast(Nine-month
result)
Forecasts for FY2014:Inventories, R&D Expenses, Capital Expenditures, Depreciation & Amortization
(billion yen)Inventories R&D Expenses
(turnover days) (% to net sales)
Capital Expenditures Depreciation and Amortization
(Nine-month result)
(Nine-month result)
66.959.655.176.5 70.0
445047
43
56
FY10Result
FY11Result
FY12Result
FY13Result
FY14Current
Forecast
23
Notes:1. “Cash Flows from Investing Activities” and “Cash and Deposits” include time deposit over three months. 2. Equity in FY2014 includes the anticipated recording of unrecognized pension obligations based on accounting standards for retirement benefits.3. D/E Ratio = Debt ÷ (Equity – Minority Interests)
Forecasts for FY2014: Cash Flows and Financial Data
FY2013Results
FY2014 PreviousForecasts
FY2014Current
Forecasts
Cash Flows from Operating Activities 1.2 34.0 29.0
Cash Flows from Investing Activities -35.2 -31.5 -25.5
Cash Flows from Financing Activities 7.0 4.5 -0.5
Free Cash Flows -34.1 2.5 3.5
FY2013 Results
FY2014 PreviousForecasts
FY2014Current
Forecasts
Equity 81.6 79.0 85.0
Equity Ratio (%) 25% 23% 24%
Net Debt 74.2 62.0 61.0
D/E Ratio (times) 1.3 1.2 1.1
Cash and Deposits 22.1 30.0 27.0
(billion yen)【Cash Flows】
【Financial Data】
24