Fujitsu Reports Fiscal 2014 Second-Quarter Financial Results
October 30 2014 - 10:39PM
JCN Newswire (English)
Results in first half of fiscal 2014 topped company projections to
steadily move forward on achieving full-year targets
Fujitsu today reported a profit for the second quarter
attributable to owners of the parent of 17.2 billion yen (US$158
million), a decrease of 6.5 billion yen compared to the second
quarter of fiscal 2013.
Consolidated revenue for the second quarter of fiscal 2014 was
1,124.1 billion yen (US$10,313 million), a decrease of 2.4% from
the second quarter of fiscal 2013. On a constant-currency basis,
revenue fell by 5%. Revenue in Japan decreased by 4.8%. Outside of
Japan revenue rose 1.3%, but declined by 4% on a constant-currency
basis.
Gross profit was 299.8 billion yen, a decrease of 11.1 billion yen
from the second quarter of fiscal 2013, resulting from the impact
of lower revenue, despite the beneficial effects of structural
reforms in the mobile phone business and other areas. The gross
profit margin was 26.7%, a decrease of 0.3 of a percentage point.
Selling, general and administrative expenses were 274.0 billion
yen, an increase of 2.2 billion yen from the second quarter of
fiscal 2013. Other expenses included a loss of 0.8 billion yen,
representing a deterioration of 2.7 billion yen from the second
quarter of fiscal 2013, primarily on one-time gains recorded in
last year's second quarter stemming from changes to the retirement
benefit plans of Fujitsu's subsidiaries in Japan.
Fujitsu recorded an operating profit of 24.9 billion yen (US$228
million), a decrease of 16.1 billion yen from last fiscal year's
second quarter.
In net financial income including financial income, financial
expenses and income from investments accounted for using the equity
method was 7.2 billion yen, an improvement of 7.3 billion yen from
the second quarter of fiscal 2013 resulting from improved net gain
on foreign exchange owing to the weak yen. Profit before income
taxes was 32.1 billion yen, a decrease of 8.7 billion yen from the
same period in the previous fiscal year.
Comparison to Consolidated Projections for First-Half Announced in
July 2014
Revenue exceeded the most recent projections announced on July 31,
2014, by 42.8 billion yen. Operating profit, profit before income
taxes, and profit for the period attributable to owners of the
parent each exceeded projections by 7.2 billion yen, 17.6 billion
yen and 14.1 billion yen, respectively. The Ubiquitous Solutions
segment exceeded projections owing to revenue from PCs/mobile
phones that exceeded projections and improvement of profitability.
Financial results in the Technology Solutions and Device Solutions
segments were essentially in line with projections. In addition, as
the yen weakened more than anticipated, there was a gain on foreign
exchange.
Fiscal 2014 Consolidated Projections
Projections for full-year fiscal 2014 remain unchanged from the
projections announced in the beginning of the fiscal year.
Comment from President Masami Yamamoto
In the first half of fiscal 2014, I am happy to report that Fujitsu
benefitted from the restructuring of our mobile phone business, as
well as from demand for upgraded PCs in line with the end of
support for an operating system, enabling year-on-year increases in
revenues and operating profit. Furthermore, Fujitsu surpassed its
estimates for the First-Half made at the beginning of fiscal 2014,
bolstering confidence that we will be able to achieve our full-year
projections. Moving forward, while the future of the world economy
becomes somewhat opaque, we continue to invest in sustainable
growth as we pursue our full year and medium term goals.
Business Segment Financial Results for the Second Quarter
Revenue in the Technology Solutions segment amounted to 784.1
billion yen (US$7,194 million), essentially unchanged from the same
period in fiscal 2013. Revenue in Japan fell 2.8%. Server-related
revenue declined sharply in comparison with the second quarter of
fiscal 2013, when there were large-scale systems deals. Revenue
outside Japan increased 4.4%. On a constant currency basis,
however, revenue declined by 2%. Revenue from optical transmission
systems in North America declined as telecommunications carriers
entered a trough in their investment cycle in relation to relevant
segments of Fujitsu's business. The segment posted an operating
profit of 39.3 billion yen (US$361 million), a sharp decline of
21.1 billion yen compared to the second quarter of fiscal 2013. In
addition to the impact of lower systems integration services
revenue from the public sector, there was the impact of lower
revenue and upfront development costs in server-related products in
Japan and lower revenue from network products both in Japan and
North America.
Revenue in the Ubiquitous Solutions segment was 245.0 billion yen
(US$2,248 million), a decrease of 6.8% from the same period of the
prior fiscal year. Revenue in Japan was down by 12.1%. Total
revenue from PCs decelerated in the second quarter, resulting in
lower revenue from both enterprise PCs and consumer PCs. Revenue
outside Japan increased 5.3% and even increased 1% on a
constant-currency basis. Revenue from PCs declined in Europe, but
increased in the Mobilewear sub-segment, primarily in North
America. The segment posted an operating profit of 0.9 billion yen
(US$8 million), an improvement of 12.5 billion yen from the second
quarter of the previous fiscal year. For mobile phones, a
combination of the impact of structural reforms implemented last
fiscal year, a decline in costs relating to quality issues, which
have stabilized, and a further reduction in operating costs, led to
a sharp improvement in operating profit, returning operations to
profitability in comparison with the loss posted in the same period
of the prior fiscal year.
Revenue in the Device Solutions segment amounted to 145.1 billion
yen (US$1,331 million), a decline of 8.7% from the same period of
fiscal 2013. Revenue from LSI devices decreased as a result of
selling the microcontroller and analog device business, and lower
revenue from the devices used in smartphones. Revenue from
electronic components declined mainly on lower revenue from
semiconductor packages in the Americas. The segment posted an
operating profit of 6.6 billion yen (US$61 million), a decline of
6.2 billion yen compared to the second quarter of fiscal 2013. For
LSI devices, operating profit was 5.1 billion yen, an improvement
of 1.1 billion yen with the impact of the weaker yen and structural
reforms, despite lower revenue. For electronic components,
operating profit was 1.5 billion yen, a decline of 7.4 billion yen
on lower revenue and intensified price competition in semiconductor
packages, and because results for the second quarter of the
previous fiscal year included a one-time posting of profit stemming
from changes to the retirement benefit plans of Fujitsu's
subsidiaries in Japan.
* Yen figures have been converted to U.S. dollars, for convenience
only, at a uniform rate of US$1 = 109 yen, the approximate closing
rate on September 30, 2014.
About Fujitsu Limited
Fujitsu is the leading Japanese information and communication
technology (ICT) company offering a full range of technology
products, solutions and services. Approximately 170,000 Fujitsu
people support customers in more than 100 countries. We use our
experience and the power of ICT to shape the future of society with
our customers. Fujitsu Limited (TSE:6702) reported consolidated
revenues of 4.4 trillion yen (US$47 billion) for the fiscal year
ended March 31, 2013 For more information, please see
www.fujitsu.com.
Source: Fujitsu Limited
Contact:
Fujitsu Limited
Public and Investor Relations
www.fujitsu.com/global/news/contacts/
+81-3-3215-5259
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