Jvckenwood Corporation · TSE:6632
Jvckenwood — Q3 FY2015 Earnings Presentation
31 slides from Jvckenwood's earnings presentation, Feb 3, 2015
Slide 1: Results and Forecast Briefing, Third Quarter FY Ending March 2015
Translation for Reference Only JVCKENWOOD Results and Forecast Briefing Third Quarter of Fiscal Year Ending March 2015 February 3, 2015 Copyright © 2015 JVC KENWOOD Corporation. All rights reserved.
Slide 2: Abbreviations
Abbreviations CE Car Electronics (Segment) Consumer (Business) OEM (Business) HA (Home Audio) (Business) PS Professional Systems (Segment) COM: Communications (Business) Pro: Pro Systems (Business) Healthcare (Business) EFJT: EF Johnson Technologies, Inc. Zetron: Zetron, Inc. O&A Optical & Audio (Se
Slide 3: Agenda
1. Overview of financial results for the third quarter of the fiscal year ending March 31, 2015 2. Review of 3Q financial closing and measures for expanding OEM business 3. Full-year earnings forecast for FYE3/’15 3
Slide 4: 1. Overview of financial results for the third quarter
1. Overview of financial results for the third quarter of the fiscal year ending March 31, 2015 2. Review of 3Q financial closing and measures for expansion of OEM business 3. Full-year earnings forecast for FYE3/’15 4
Slide 5: Summary of 3Q results (first nine months)
Financial Results for 3Q of FYE3/’15 (first nine months) – Summary Net sales: Decreased (90% YoY) due to the effects of business transfer, etc. (approx. JPY 12.8 billion). Operating income: Increased significantly due to structural and operational reforms. Ordinary income: Achieved a turnaroun
Slide 6: Consolidated Net Sales (By Segment)
Financial Results for 3Q of FYE3/’15 (first nine months) - Consolidated Net Sales (By Segment) 1-3Q Results: JPY 206.9 billion in total (a decrease of 10.1% YoY) [Decrease in sales] CE: Affected by contraction of HA product lineup, although OEM sales rose due to increased product sales. PS: Ef
Slide 7: Consolidated Net Sales (By Region)
Financial Results for 3Q of FYE3/’15 (first nine months) - Consolidated Net Sales (By Region) 1-3Q Result: JPY 206.9 billion in total (a decrease of 10.1% YoY) [Decrease in sales] Asia/China: Sales increased due to continued strong product sales, consolidation of Shinwa, and other factors. Jap
Slide 8: Consolidated Operating Income (By Segment)
Financial Results for 3Q of FYE3/’15 (first nine months) - Consolidated Operating Income (By Segment) 1-3Q Result: JPY 2.5 billion in total (an increase of JPY 4.2 billion YoY) [Achieved a turnaround] CE: Achieved a turnaround due to business reforms (e.g. reforms to overall cost structure/sales
Slide 9: Consolidated Operating Income (By Factor)
Financial Results for 3Q of FYE3/’15 (first nine months) - Consolidated Operating Income (By Factor) Effects of structural reforms: Initial estimate (+JPY 6.5 billion) (full year) 1-3Q total (+JPY 4.4 billion) => Almost as forecasted Effects of business reforms: Initial estimate (+JPY 2.5 bill
Slide 10: Consolidated Ordinary Income
Financial Results for 3Q of FYE3/’15 (first nine months) - Consolidated Ordinary Income 1-3Q Results: JPY 0.1 billion in total (an increase of JPY 4.7 billion YoY) [Achieved a turnaround] In addition to improved operating income, non-operating income and expenses improved by JPY 0.5 billion, due
Slide 11: Consolidated Net Income
Financial Results for 3Q of FYE3/’15 (first nine months) - Consolidated Net Income 1-3Q Results: Net loss of JPY 0.7 billion (Improved JPY 5.0 billion YoY) Improved significantly due to the posting of income tax - deferred of JPY 3.5 billion (credited), as a result of integrating a U.S. subsidia
Slide 12: Balance Sheet Summary
Financial Results for 3Q of FYE3/’15 - Balance Sheet Summary Total assets: Rose JPY 1.1 billion due to increased inventories, etc., despite decreases in cash and deposits as a result of repayments of loans and decreases in notes and accounts receivable, etc. Interest-bearing debts (sum of borrow
Slide 13: Interest-bearing Debts
Financial Results for 3Q of FYE3/’15 - Interest-bearing Debts Both interest-bearing debts and net debt are decreasing on a step-by-step basis. Changes in Interest-bearing debts (consolidated) (Billion yen) Net debt Cash and deposits 160 Redemption of bonds payable Redemption of bonds payable worth
Slide 14: Shareholders' Equity Ratio
Financial Results for 3Q of FYE3/’15 - Shareholders’ Equity Ratio Net assets rose because foreign currency translation adjustments increased as a result of the yen’s depreciation against major currencies. Shareholders’ equity ratio recovered to 23.0%. (Billion yen) Change in shareholders’ equity r
Slide 15: Cash Flow Summary
Financial Results for 3Q of FYE3/’15 (first nine months) - Cash Flow Summary Free cash flow fell into negative territory because operating cash flow decreased as a result of costs incurred in connection with structural reforms conducted last year (approx. JPY 6.4 billion). (Billion yen) FYE FYE FY
Slide 16: (Reference) Information by Segment
(Reference) Information by Segment 16
Slide 17: Car Electronics
Financial Results for 3Q of FYE3/’15 (first nine months) - Car Electronics Net sales: Domestically on a par with last year due to the effects of a consumption tax hike, etc., despite strong consumer product sales in Americas and Asia. OEM sales also increased due to strong product sales in Asia an
Slide 18: Professional Systems
Financial Results for 3Q of FYE3/’15 (first nine months) - Professional Systems Net sales: COM sales increased due to a recovery in North America (the biggest market), effects of the acquisition of EFJT, and other factors. Pro sales were on a par with last year because Japan compensated for a fall
Slide 19: Optical & Audio
Financial Results for 3Q of FYE3/’15 (first nine months) - Optical & Audio Net sales: Creation sales decreased significantly due to the effects of reduced unit sales of consumer camcorder products. Image & Optical business was affected by decreased projector sales. AV Accessory sales were on a par
Slide 20: Software & Entertainment
Financial Results for 3Q of FYE3/’15 (first nine months) - Software & Entertainment Net sales: Content sales decreased due to changes to the composition of titles and postponed releases of some major titles, but are expected to recover in 4Q. OEM sales decreased due to a decline in the number of e
Slide 21: 2. Review of 3Q financial closing and measures for expanding OEM business
1. Overview of financial results for the third quarter of the fiscal year ending March 31, 2015 2. Review of 3Q financial closing and measures for expanding OEM business 3. Full-year earnings forecast for FYE3/’15 21
Slide 22: Review of Financial Results for the Third Quarter
Review of Financial Results for the Third Quarter of the Fiscal Year Ending March 31, 2015 (first nine months) “Our performance is continuing to recover steadily.” Effects of structural and business reforms also emerged clearly in 3Q. All segments posted profits because operating income for 1-3Q in
Slide 23: Progress of Restructuring of Overseas Bases
Progress of Restructuring of Overseas Bases Americas Integration of sales companies in North America (2 companies -> 1): Completed in October 2014. Integration of sales companies in Canada (3 companies -> 1): Scheduled to be completed in April 2015. Europe Integration of sales companies in
Slide 24: OEM Business Expansion Strategy (Genuine Products Operations)
OEM Business Expansion Strategy (Genuine Products Operations) Promote M&A and next-generation business development to expand genuine products operations of OEM Business. Made a European car parts company a subsidiary Made ASK Industries S.p.A. (“ASK”) a subsidiary to expand genuine products oper
Slide 25: OEM Business Expansion Strategy: (1) M&A
OEM Business Expansion Strategy (Genuine Products Operations): (1) M&A Made ASK Industries S.p.A. (“ASK”) in Europe a subsidiary. Acquired base to expand genuine products business. ̶ Acquired solid partnerships with leading auto makers in Europe by making ASK a subsidiary. ̶ Solidified bases inc
Slide 26: OEM Business Expansion Strategy: (1) M&A, Forecasted Effects
OEM Business Expansion Strategy (Genuine Products Operations): (1) M&A Forecasted effects of integration ̶ Acquire a business to supply genuine products to leading auto makers in Europe such as the Volkswagen Group, Daimler Group, Fiat Group, and BMW. Ranked second for speaker market share ̶ Will
Slide 27: OEM Business Expansion: (2) Next-generation Business Development
OEM Business Expansion Strategy (Genuine Products Operations): (2) Next-generation Business Development Promote development of digital cockpit systems. One of a few specialized makers that has various core technologies. ̶ Promote development using strengths of group companies’ various core techn
Slide 28: OEM Business Expansion: (2) Next Generation Business Development
OEM Business Expansion Strategy (Genuine Products Operations): (2) Next Generation Business Development Creating a safe automotive environment that ensures peace of mind by installing in regular vehicles Aiming for commercialization of innovative Advanced Driver Assistance System (i-ADAS). Head-
Slide 29: 3. Full-year earnings forecast for FYE3/'15
1. Overview of financial results for the third quarter of the fiscal year ending March 31, 2015 2. Review of 3Q financial closing and measures for expansion of OEM business 3. Full-year earnings forecast for FYE3/’15 29
Slide 30: Full-year Earnings Forecast for FYE3/'15
Full-year Earnings Forecast for FYE3/’15 Revise net income to JPY 3.0 billion due to the posting of deferred tax assets as a result of integrating U.S. subsidiaries. Recovery of CE and COM (terminals) operations is noticeable. Effects of structural reforms have emerged steadily. Operating inco
Slide 31: Forward-looking statements disclaimer
Expressions contained in this presentation referring to the Company‘s future plans, intentions and expectations are categorized as future forecast statements. Such statements reflect management expectations of future events, and accordingly, are inherently susceptible to risk, uncertainty and other