RNS Number:2459O
NEC Corporation
01 August 2003
Consolidated Financial Results for the First Quarter of the Fiscal Year Ending
March 31, 2004
I. Consolidated Financial Results
Three months ended June Three months ended June Increase
30, 2003 30, 2002 (Decrease)
In billions of yen In billions of yen %
Net sales 1,030.7 1,021.2 0.9
Operating income (loss) 12.0 (7.0) -
Income before income 9.8 19.8 (50.2)
taxes
Net income 0.7 7.2 (90.3)
Yen Yen Yen
Per share of common stock
Net income:
Basic: 0.42 4.37 (3.95)
Diluted: 0.40 4.06 (3.66)
As of June 30, As of March 31, Increase
2003 2003 (Decrease)
In billions of yen In billions of yen %
Total assets 3,983.3 4,103.3 (2.9)
Shareholders' equity 378.6 358.4 5.6
(Notes)
1. The consolidated financial statements of NEC are prepared in accordance with
accounting principles generally accepted in the United States, or U.S. GAAP.
2. Number of consolidated subsidiaries and affiliated companies accounted for by
the equity method:
As of June 30, 2003 As of March 31, 2003 As of June 30, 2002
Consolidated subsidiaries 194 183 179
Affiliated companies 17 17 11
accounted for by the
equity method
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II. Business Results
First Quarter of the Fiscal Year Ending March 31, 2004 (three months ended
June 30, 2003)
During the three months ended June 30, 2003, the Japanese economy saw some
improvement of its financial stability through the injection of public funds and
the recovery of the stock market during the latter part of the period. This has
resulted in a gradual boost of confidence in the economy. However, the real
economy of Japan still remained severe due to continuing deflation in Japan and
growing concern regarding the United States economy.
The business environment surrounding NEC has also remained challenging since the
previous fiscal year. There are, however, various positive signs due to the
steadily growing popularity of broadband and mobile communications. In fact,
broadband subscribers now exceed 10 million in Japan and the penetration rate of
mobile phones has surpassed 60%.
NEC has concentrated on optimizing its management structure to match the
characteristics of individual business sectors, the innovation of its
manufacturing process, and reducing materials cost. These steps are intended to
reinforce NEC's corporate structure so as to yield profits even in the midst of
deflation. During the current fiscal year, NEC is implementing the following
four strategies:
1. Secure stable profits by strengthening core businesses.
2. Eliminate down-side risk by improving loss making business areas.
3. Rebuild a sound financial structure.
4. Establish a growth strategy with IT/network integrated solutions.
Consolidated net sales of NEC for the three months ended June 30, 2003 increased
by 9.5 billion yen, or 1%, to 1,030.7 billion yen as compared with the
corresponding period of the previous fiscal year. This was mainly due to
increased sales in mobile communications products and social infrastructure
business. Sales decreases were mainly in the areas of personal solutions and
computer platforms.
Regarding profits, there was a significant improvement during the corresponding
period of the previous fiscal year due mainly to lowering fixed expenses and
promoting cost reductions. During this quarter as well, both the ratios of cost
of sales and selling, general and administrative (SG&A) expenses against net
sales showed improvements. As a result, NEC recorded an operating income of 12.0
billion yen, an increase of 19.1 billion yen as compared with the corresponding
period of the previous fiscal year.
As compared with the corresponding period of the previous fiscal year, income
before income taxes decreased by 9.9 billion yen to 9.8 billion yen. The main
reason for such a decrease was that NEC recorded a considerable amount of gain
on the sale of marketable securities in the corresponding period of the previous
fiscal year. NEC posted a net income of 0.7 billion yen, this is a decrease of
6.5 billion yen as compared with the corresponding period of the previous fiscal
year. However, NEC recorded equity in losses of affiliated companies of 3.9
billion yen (an improvement of 1.0 billion yen as compared with the
corresponding period of the previous fiscal year) mainly due to the weak
operating results of semiconductor-related affiliated companies.
Results by business segments (including inter-segment transactions and
profit/loss figures)
Sales and segment profits of NEC's main segments were as follows (figures in
brackets denote increases or decreases as compared with the corresponding period
of the previous fiscal year):
IT Solutions Business
Sales: 401.5 billion yen (-10%)
Segment profit: 5.5 billion yen (+2.1 billion yen)
Sales for IT Solutions business for the three months ended June 30, 2003 were
401.5 billion yen, a decrease of 10% as compared with the corresponding period
of the previous fiscal year.
Regarding sales by main product areas, although the IT market remained severe in
Japan, systems integration ("SI") services for the private sectors such as
manufacturing and retail industries grew steadily. As compared with the
corresponding period of the previous fiscal year sales for SI/services increased
by 6% to 131.6 billion yen. Compared with the corresponding period of the
previous fiscal year when NEC won large shipments, sales for software decreased
by 11% to 16.0 billion yen. In the area of computer platforms, sales decreased
by 23% to 86.8 billion yen due to the fact that large shipments were also
secured during the corresponding period of the previous fiscal year, and to the
recent drop in overall price. In the area of personal solutions business, due to
a decrease in domestic shipments of personal computers ("PCs") for consumers,
sales decreased by 12% to 167.1 billion yen as compared with the corresponding
period of the previous fiscal year.
Segment profit of the IT Solutions business was 5.5 billion yen, an increase of
2.1 billion yen as compared with the corresponding period of the previous fiscal
year. The main contributing factors were the significant improvement of
profitability in the field of PC business by the reduction of fixed expenses, as
well as the cost reduction through the promotion of centralized purchasing and
standardization of parts.
Network Solutions Business
Sales: 388.6 billion yen (+18%)
Segment profit: 10.6 billion yen (+5.3 billion yen)
Sales for Network Solutions business increased by 18% to 388.6 billion yen as
compared with the corresponding period of the previous fiscal year.
Regarding sales by main product areas, in the area of broadband, although there
are new business opportunities in the corporate and broadband access field, the
world telecommunications market remained severe. As a result, sales for
broadband communications systems and services decreased by 14% to 88.7 billion
yen as compared with the corresponding period of the previous fiscal year. In
the area of mobile communications, although sales of mobile infrastructure
decreased, shipments for mobile handsets grew in Japan and full-scale shipments
to overseas markets were launched. These positive factors resulted in sales
increase for mobile communications products by 35% to 249.2 billion yen. In the
area of social infrastructure, due to the growth of terrestrial digital
broadcasting systems in Japan, sales increased by 22% to 50.7 billion yen as
compared with the corresponding period of the previous fiscal year.
Segment profit of the Network Solutions business was 10.6 billion yen. This was
mainly due to the improved profitability in the broadband area deriving from the
reduction of fixed expenses and costs which had been implemented since the
previous fiscal year.
Electron Devices Business
Sales: 224.7 billion yen (-2%)
Segment profit: 10.5 billion yen (+13.7 billion yen)
Sales for Electron Devices business were 224.7 billion yen, a decrease of 2% as
compared with the corresponding period of the previous fiscal year.
Regarding sales by main product areas, overall semiconductor sales increased by
5% to 174.9 billion yen as compared with the corresponding period of the
previous fiscal year. This was due to the steady growth in sales of
semiconductors for mobile phones featuring color displays and sophisticated
functions. Sales for displays saw a decrease of 32% to 19.8 billion yen as
compared with the corresponding period of the previous fiscal year. This was
mainly due to a shift from less-profitable general-use products for PCs to high
value-added industrial products in the color liquid crystal display ("LCDs")
business. Despite steady growth in the area of electronic components and other
products, sales decreased by 11% to 30.0 billion yen as compared with the
corresponding period of the previous fiscal year. This was mainly due to the
exclusion of printed wiring boards business and car electronics business from
NEC's scope of consolidation as a result of business restructuring which was
implemented during the previous fiscal year.
Segment profit of Electron Devices business was 10.5 billion yen, a large
improvement as compared with the corresponding period of the previous fiscal
year when NEC posted a segment loss of 3.2 billion yen. This was mainly due to
improved profitability for semiconductor business which is the core of the
Electron Devices business, and improved profitability for color LCDs business
and electronic components business which are NEC's loss making businesses.
Cash Flow
Net cash provided by operating activities during the three months ended June 30,
2003 was 4.2 billion yen, an increase of 75.3 billion yen as compared with the
corresponding period of the previous fiscal year. This was mainly due to a
smaller decrease in notes and accounts payable reflecting reduced payments for
parts and materials.
Net cash used in investing activities was 29.9 billion yen, an increase of 71.4
billion yen as compared with the corresponding period of the previous fiscal
year. This was mainly due to decreased proceeds from the sale of marketable
securities.
As a result, free cash flows (the total of cash flows from operating activities
and cash flows from investing activities) were cash outflows of 25.6 billion
yen, a 3.9 billion yen improvement as compared with the corresponding period of
the previous fiscal year.
Net cash provided by financing activities was 19.8 billion yen mainly due to an
increase in commercial paper. As a result, cash and cash equivalents amounted to
340.4 billion yen, an increase of 90.1 billion yen as compared with the
corresponding period of the previous fiscal year.
Due to the deconsolidation of a leasing company, the balance of interest-bearing
debt was 1,508.1 billion yen, a decrease of 699.9 billion yen as compared with
the corresponding period of the previous fiscal year (a decrease of 149.7
billion yen excluding the effect of the deconsolidation of a leasing company).
When compared to the end of the previous fiscal year ended March 31, 2003, this
was an increase of 21.0 billion yen due mainly to an increase in commercial
paper.
Outlook for the Fiscal Year Ending March 31, 2004
Although there is some improvement in domestic business confidence, there has
been no noticeable change in IT investment by companies and capital expenditure
of telecommunications carriers. There has been no significant change in NEC's
business environment since the announcement of NEC's financial forecast on April
24, 2003.
Under these circumstances, it is anticipated that for the six months ending
September 30, 2003, the forecast of the consolidated net sales announced this
April will be maintained mainly due to the steady growth of IT/network related
businesses and the electron devices business.
Regarding profits, NEC has revised its forecast for the six months ending
September 30, 2003 announced this April as below. This was due to (i) the steady
progress of cost and expense reductions, and (ii) more than expected profit
resulting from the sale of shares of NEC Electronics Corporation, a subsidiary
of NEC, in connection with the listing of the subsidiary on the First Section of
the Tokyo Stock Exchange on July 24, 2003.
NEC intends to review the financial results forecast for the fiscal year ending
March 31, 2004 and announce the revision for the forecast, if necessary, on or
before the announcement of the financial results for the first half of the
fiscal year scheduled to be made at the end of October 2003. The forecasts for
the interim and year-end dividends are yet to be determined as announced this
April.
Revised Financial Results Forecast for the First Half of the Fiscal Year Ending
March 31, 2004
Consolidated
Revised forecast on July Comparison with the Comparison with the
31, 2003 corresponding period of forecast on April 24,
the previous fiscal year 2003
In billions of yen In billions of yen In billions of yen
(except % figure)
Net sales 2,200.0 + 1% -
Operating income 50.0 + 23.3 + 5.0
Income before income 65.0 + 44.6 + 30.0
taxes
Net income 12.0 + 11.0 + 9.0
Non-consolidated
Revised forecast on July Comparison with the Comparison with the
31, 2003 corresponding period of forecast on April 24,
the previous fiscal year 2003
In billions of yen In billions of yen In billions of yen
(except % figure)
Net sales 1,100.0 - 21% -
Ordinary income 1.0 + 33.3 -
Net income 16.0 + 18.9 + 11.0
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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(In millions of yen, millions of U.S. dollars)
Three months ended June 30 2003 (% of net 2002 (% of net Increase 2003
sales) sales) (decrease)
Net sales JPY1,030,743 (100.0)JPY1,021,239 (100.0) JPY 9,504 $8,590
Cost of sales 755,873 (73.3) 757,164 (74.1) (1,291) 6,299
Selling, general and administrative expenses 262,834 (25.5) 271,160 (26.6) (8,326) 2,191
Operating income (loss) 12,036 (1.2) (7,085) (-0.7) 19,121 100
Non-operating income 18,030 (1.7) 68,086 (6.6) (50,056) 150
Interest and dividends 3,644 4,175 (531) 30
Other 14,386 63,911 (49,525) 120
Non-operating expenses 20,172 (1.9) 41,123 (4.0) (20,951) 168
Interest 7,775 9,209 (1,434) 65
Other 12,397 31,914 (19,517) 103
Income before income taxes 9,894 (1.0) 19,878 (1.9) (9,984) 82
Provision for income taxes 4,947 (0.5) 8,337 (0.8) (3,390) 41
Minority interest in income (losses) of 278 (0.0) (739) (-0.1) 1,017 2
consolidated subsidiaries
Equity in losses of affiliated companies (3,969) (-0.4) (5,049) (-0.5) 1,080 (33)
Net income JPY 700 (0.1) JPY 7,231 (0.7) (JPY6,531) $6
(Note)
US dollar amounts are translated from yen, for convenience only, at the rate of
US$1 = 120 yen.
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CONDENSED CONSOLIDATED BALANCE SHEETS
(In millions of yen, millions of U.S. dollars)
June 30, June 30, Increase March 31, Increase June 30,
2003 2002 (decrease) 2003 (decrease) 2003
(Unaudited) (Unaudited) (Unaudited)
Current assets JPY JPY JPY JPY JPY $15,282
1,833,771 2,117,445 (283,674) 1,920,042 (86,271)
Cash and cash equivalents 340,488 250,291 90,197 344,345 (3,857) 2,837
Notes and accounts receivable, trade 641,693 712,220 (70,527) 821,985 (180,292) 5,347
Current portion of investment in leases - 248,726 (248,726) - - -
Inventories 636,265 681,343 (45,078) 553,820 82,445 5,302
Other current assets 215,325 224,865 (9,540) 199,892 15,433 1,796
Long-term assets 2,149,589 2,535,507 (385,918) 2,183,258 (33,669) 17,913
Long-term receivables, trade 24,701 37,371 (12,670) 33,073 (8,372) 206
Investments and advances 433,088 495,351 (62,263) 433,027 61 3,609
Investment in leases - 255,707 (255,707) - - -
Property, plant and equipment 813,468 948,255 (134,787) 838,341 (24,873) 6,779
Other assets 878,332 798,823 79,509 878,817 (485) 7,319
Total assets JPY JPY JPY JPY JPY $33,195
3,983,360 4,652,952 (669,592) 4,103,300 (119,940)
Current liabilities JPY JPY JPY JPY JPY $13,933
1,671,887 1,923,899 (252,012) 1,774,224 (102,337)
Short-term borrowings and current portion of 545,826 768,984 (223,158) 483,306 62,520 4,549
long-term debt
Notes and accounts payable, trade 785,729 747,225 38,504 875,018 (89,289) 6,548
Other current liabilities 340,332 407,690 (67,358) 415,900 (75,568) 2,836
Long-term liabilities 1,698,676 1,952,986 (254,310) 1,737,219 (38,543) 14,156
Long-term debt 962,364 1,439,168 (476,804) 1,003,787 (41,423) 8,020
Accrued pension and severance costs 705,646 482,580 223,066 705,551 95 5,880
Other 30,666 31,238 (572) 27,881 2,785 256
Minority shareholders' equity in consolidated 136,203 143,688 (7,485) 135,613 590 1,135
subsidiaries
Preferred securities issued by a subsidiary 97,950 97,350 600 97,800 150 816
Common stock 244,726 244,726 - 244,726 - 2,039
Additional paid-in capital 361,817 361,820 (3) 361,820 (3) 3,015
Retained earnings 42,267 73,356 (31,089) 41,567 700 352
Accumulated other comprehensive income (loss) (266,905) (142,493) (124,412) (286,417) 19,512 (2,224)
Treasury stock (3,261) (2,380) (881) (3,252) (9) (27)
Total shareholders' equity 378,644 535,029 (156,385) 358,444 20,200 3,155
Total liabilities and shareholders' equity JPY JPY JPY JPY JPY $33,195
3,983,360 4,652,952 (669,592) 4,103,300 (119,940)
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CONDENSED CONSOLIDATED BALANCE SHEETS ( SUPPLEMENTARY INFORMATION )
(In millions of yen, millions of U.S.dollars)
June 30, June 30, Increase March 31, Increase June 30,
2003 2002 (decrease) 2003 (decrease) 2003
(Unaudited) (Unaudited) (Unaudited)
Current assets JPY JPY (JPY 5,063) JPY JPY $15,282
1,833,771 1,838,834 1,920,042 (86,271)
Cash and cash equivalents 340,488 231,097 109,391 344,345 (3,857) 2,837
Notes and accounts receivable, trade 641,693 729,389 (87,696) 821,985 (180,292) 5,347
Inventories 636,265 681,343 (45,078) 553,820 82,445 5,302
Other current assets 215,325 197,005 18,320 199,892 15,433 1,796
Long-term assets 2,149,589 2,273,827 (124,238) 2,183,258 (33,669) 17,913
Long-term receivables, trade 24,701 37,371 (12,670) 33,073 (8,372) 206
Investments and advances 433,088 514,648 (81,560) 433,027 61 3,609
Property, plant and equipment 813,468 931,358 (117,890) 838,341 (24,873) 6,779
Other assets 878,332 790,450 87,882 878,817 (485) 7,319
Total assets JPY JPY JPY JPY JPY $33,195
3,983,360 4,112,661 (129,301) 4,103,300 (119,940)
Current liabilities JPY JPY JPY JPY JPY $13,933
1,671,887 1,756,408 (84,521) 1,774,224 (102,337)
Short-term borrowings and current portion of 545,826 571,911 (26,085) 483,306 62,520 4,549
long-term debt
Notes and accounts payable, trade 785,729 791,213 (5,484) 875,018 (89,289) 6,548
Other current liabilities 340,332 393,284 (52,952) 415,900 (75,568) 2,836
Long-term liabilities 1,698,676 1,596,074 102,602 1,737,219 (38,543) 14,156
Long-term debt 962,364 1,086,008 (123,644) 1,003,787 (41,423) 8,020
Accrued pension and severance costs 705,646 481,576 224,070 705,551 95 5,880
Other 30,666 28,490 2,176 27,881 2,785 256
Minority shareholders' equity in consolidated 136,203 127,800 8,403 135,613 590 1,135
subsidiaries
Preferred securities issued by a subsidiary 97,950 97,350 600 97,800 150 816
Common stock 244,726 244,726 - 244,726 - 2,039
Additional paid-in capital 361,817 361,820 (3) 361,820 (3) 3,015
Retained earnings 42,267 73,356 (31,089) 41,567 700 352
Accumulated other comprehensive income (loss) (266,905) (142,493) (124,412) (286,417) 19,512 (2,224)
Treasury stock (3,261) (2,380) (881) (3,252) (9) (27)
Total shareholders' equity 378,644 535,029 (156,385) 358,444 20,200 3,155
Total liabilities and shareholders' equity JPY JPY JPY JPY JPY $33,195
3,983,360 4,112,661 (129,301) 4,103,300 (119,940)
(Note)
In the condensed consolidated balance sheet at the end of June 30, 2002 on this
page, the investment in a leasing subsidiary is accounted for by the equity
method.
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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(In millions of yen, millions of U.S. dollars)
Three months ended June 30 2003 2002 Increase 2003
(Decrease)
I. Cash flows from operating activities
Net income JPY 700 JPY 7,231 (JPY6,531) $6
Adjustments to reconcile net income to net cash provided by (used in)
operating activities
Depreciation 39,898 43,730 (3,832) 332
Equity in losses of affiliated companies, net of dividends 4,454 5,294 (840) 37
Decrease in notes and accounts receivable 199,988 208,742 (8,754) 1,667
Increase in inventories (82,928) (29,962) (52,966) (691)
Decrease in notes and accounts payable (80,330) (178,684) 98,354 (669)
Other, net (77,533) (127,474) 49,941 (647)
Net cash provided by (used in) operating activities 4,249 (71,123) 75,372 35
II. Cash flows from investing activities
Proceeds from sales of fixed assets 8,356 14,604 (6,248) 70
Additions to fixed assets (56,424) (30,574) (25,850) (470)
Proceeds from sales of marketable securities 16,685 44,330 (27,645) 139
Purchase of marketable securities (4) (67) 63 0
Other, net 1,486 13,265 (11,779) 12
Net cash provided by (used in) investing activities (29,901) 41,558 (71,459) (249)
Free cash flows ( I + II ) (25,652) (29,565) 3,913 (214)
III. Cash flows from financing activities
Net proceeds from (repayments of) bonds and borrowings 20,291 (89,899) 110,190 169
Dividends paid (780) (4,689) 3,909 (7)
Other, net 292 (61) 353 3
Net cash provided by (used in) financing activities 19,803 (94,649) 114,452 165
Effect of exchange rate changes on cash and cash equivalents 1,992 (3,267) 5,259 17
Net decrease in cash and cash equivalents (3,857) (127,481) 123,624 (32)
Cash and cash equivalents at beginning of period 344,345 377,772 (33,427) 2,869
Cash and cash equivalents at end of period JPY JPY JPY 90,197 $2,837
340,488 250,291
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SEGMENT INFORMATION (UNAUDITED)
Business Segment Information
(1) Net Sales (Including internal sales to other segments)
(In millions of yen, millions of U.S.dollars)
Three months ended June 30 2003 (% of total) % change 2002 (% of total) 2003
IT Solutions business JPY 401,573 (39.0) -9.7 JPY 444,893 (43.6) $3,346
Network Solutions business 388,634 (37.7) +17.7 330,178 (32.3) 3,239
Electron Devices business 224,766 (21.8) -2.0 229,337 (22.5) 1,873
Others 130,667 (12.7) -0.4 131,205 (12.8) 1,089
Eliminations (114,897) (-11.2) - (118,833) (-11.6) (957)
Electronics business total 1,030,743 (100.0) +1.4 1,016,780 (99.6) 8,590
Leasing business - - - 10,192 (1.0) -
Eliminations - - - (5,733) (-0.6) -
Consolidated total JPY 1,030,743 (100.0) +0.9 JPY 1,021,239 (100.0) $8,590
(2) Segment Profit or Loss
(In millions of yen, millions of U.S.dollars)
Three months ended June 30 2003 (% of profit on sales) Increase 2002 (% of profit on sales) 2003
(decrease)
IT Solutions business JPY 5,536 (1.4) JPY 2,150 JPY 3,386 (0.8) $46
Network Solutions business 10,630 (2.7) 5,313 5,317 (1.6) 89
Electron Devices business 10,532 (4.7) 13,780 (3,248) (-1.4) 88
Others (5,074) (-3.9) (305) (4,769) (-3.6) (42)
Eliminations (2,674) - 123 (2,797) - (23)
Unallocated corporate expenses (6,914) - (442) (6,472) - (58)
Electronics business total 12,036 (1.2) 20,619 (8,583) (-0.8) 100
Leasing business - - (2,243) 2,243 (22.0) -
Eliminations - - 745 (745) - -
Consolidated total JPY 12,036 (1.2) JPY 19,121 (JPY 7,085) (-0.7) $100
(Note)
Corporate expenses include general corporate expenses and research and
development expenses at NEC Corporation which are not allocated to any business
segment.
(3) Net Sales to External Customers
(In billions of yen, millions of U.S.dollars)
Three months ended June 30 2003 % change 2002 2003
IT Solutions business JPY 372.7 -8.7 JPY 408.2 $3,106
Domestic 312.9 -12.0 355.5 2,608
Overseas 59.7 +13.5 52.6 498
Network Solutions business 374.5 +21.8 307.5 3,121
Domestic 277.8 +23.2 225.4 2,315
Overseas 96.7 +17.7 82.1 806
Electron Devices business 192.8 -7.5 208.4 1,607
Domestic 113.0 -12.4 129.1 942
Overseas 79.7 +0.6 79.2 665
Others 90.5 +2.1 88.7 756
Domestic 65.7 -4.8 69.0 548
Overseas 24.8 +26.3 19.6 208
Electronics business total 1,030.7 +1.8 1,013.0 8,590
Domestic 769.6 -1.2 779.1 6,413
Overseas 261.1 +11.7 233.8 2,177
Leasing business - -100.0 8.2 -
Domestic - -100.0 8.2 -
Overseas - - - -
Consolidated total JPY 1,030.7 +0.9 JPY 1,021.2 $8,590
Domestic 769.6 -2.3 787.4 6,413
Overseas 261.1 +11.7 233.8 2,177
(4) Net Sales by Products and Services (Including internal sales to other segments) *1
(In billions of yen, millions of U.S. dollars)
Three months ended June 30 2003 % change 2002 2003
IT Solutions business JPY 401.5 -9.7 JPY 444.8 $3,346
SI / Services 131.6 +5.6 124.6 1,097
Software 16.0 -11.1 18.0 133
Computers / Platforms 86.8 -22.6 112.2 723
Personal Solutions 167.1 -12.1 190.0 1,393
Network Solutions business JPY 388.6 +17.7 JPY 330.1 $3,239
Broadband 88.7 -14.3 103.5 739
Mobile 249.2 +34.7 185.0 2,077
Social Infrastructure 50.7 +21.9 41.6 423
Electron Devices business JPY 224.7 -2.0 JPY 229.3 $1,873
Semiconductors 174.9 +5.0 166.6 1,458
Displays 19.8 -32.0 29.1 165
Electronic Components 30.0 -10.7 33.6 250
(Note)
*1 According to the introduction of the new business line system in April 2003,
NEC revised the classification of the product area in each business segment.
Sales by product areas in each business segment of the three months ended June
30, 2002 have been reclassified and displayed to conform to those of the three
months ended June 30, 2003.
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Operating income (loss) set forth above is a measure commonly used by companies
reporting in accordance with accounting principles generally accepted in Japan.
Management believes this measure is useful to investors in comparing NEC's
results of operations to other Japanese companies. This measure, however, should
not be construed as an alternative to "income (loss) before income taxes" or
"net income (loss)" as determined in accordance with U.S. GAAP. Please refer to
the condensed consolidated statement of operations for the calculation of the
operating income (loss).
***
CAUTIONARY STATEMENTS:
The statements in this press release with respect to the plans, strategies and
forecasts of NEC Corporation and its consolidated subsidiaries (collectively
"NEC") are forward-looking statements involving risks and uncertainties. NEC
cautions in advance you that actual results could differ materially from such
forward-looking statements due to several factors. The important factors that
could cause actual results to differ materially from such statements include,
but are not limited to, general economic conditions in NEC's markets, which are
primarily Japan, North America, Asia and Europe; demand for, and competitive
pricing pressure on, NEC's products and services in the marketplace; NEC's
ability to continue to win acceptance of its products and services in these
highly competitive markets; and movements in currency exchange rates,
particularly the rate between the yen and the U.S. dollar. Among other factors,
a worsening of the world economy resulting from the downturn in the IT and
telecommunications industries, a worsening of financial conditions in the world
markets, and a deterioration in the domestic and overseas stock markets, would
cause actual results to differ from the projected results forecast.
In cases where the information contained in this press release falls within the
definition of "Material Information" under Paragraph 2 of Article 166 of the
Securities and Exchange Law of Japan, if you (and directors or employees of your
company if the content of this press release comes to their knowledge in
connection with their duty) read this press release before the time of
"Publication" (which is defined under the Securities and Exchange Law of Japan
and its Enforcement Ordinance as twelve hours after its release; i.e.,
approximately 3:30 am on August 1, 2003 (JST)), you (and directors or employees
of your company if the content of this press release comes to their knowledge in
connection with their duties) may be prohibited from purchasing, selling, or
making other transactions of shares of stock or other securities of NEC before
the time of Publication.
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Contact: Diane Foley
Corporate Communications Division
NEC Corporation
+81-3-3798-6511
This information is provided by RNS
The company news service from the London Stock Exchange
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