Nec Corporation · TSE:6701

Nec — Nec Corp Unsp/Adr New — Q3 2023 Earnings Presentation

32 slides from Nec's earnings presentation, Jan 30, 2023

  1. Slide 1: Financial Results for Q3 Fiscal Year Ending March 31, 2023

    6701.T Financial Results for Q3 Fiscal Year Ending March 31, 2023 January 30, 2023 NEC Corporation (https://www.nec.com/en/global/ir/) © NEC Corporation 2023

  2. Slide 2: Orchestrating a brighter world

    \ Orchestrating a brighter world NEC creates the social values of safety, securi fairness and efficiency to promote a more sustaii where everyone has the chance to reach

  3. Slide 3: Index

    Index I. Financial Results for Q3, FY23/3 II. Financial Forecasts for FY23/3 III. Financial Results for Q3, FY23/3 (Appendix) IV. Financial Results for 9 months, FY23/3 (Appendix) • Net profit refers to net profit attributable to owners of the parent for the same period.

  4. Slide 4: I. Financial Results for Q3, FY23/3

    I. Financial Results for Q3, FY23/3

  5. Slide 5: Summary of Financial Results for Q3, FY23/3

    9 month Summary of Financial Results for Q3, FY23/3 Results Adjusted Operating Profit increased YoY in 9 months （Billions of Yen） 1H <6 months> Q3 <October to December> 9 months <April to December> FY22/3 FY23/3 FY22/3 FY23/3 FY22/3 FY23/3 YoY YoY YoY Actual Actual Actual Actual Actual Actual Revenu

  6. Slide 6: Financial Results by Segment

    9 month Financial Results by Segment Results （Billions of Yen） 1H <6 months> Q3 <October to December> 9 months <April to December> FY22/3 FY23/3 FY22/3 FY23/3 FY22/3 FY23/3 YoY YoY YoY Actual Actual Actual Actual Actual Actual Public Revenue 193.3 183.8 - 4.9% 97.0 102.3 + 5.4% 290.4 286.1 - 1.5% Ad

  7. Slide 7: Adjusted Operating Profit/Loss Change (Year on Year)

    9 month Adjusted Operating Profit/Loss Change (Year on Year) Results （Billions of Yen） Currency fluctuations +11.5 Asset sales, Component shortages +3.0 Asset sales, etc. stock transfer, etc. Changes in macro economic environment Intellectual Property FY22/3 FY23/3 +14.5 Marginal profit, (IP) income

  8. Slide 8: Network Services Business

    9 month Network Services Business Results (Billions of Yen) <Adjusted Operating Profit/Loss: YoY Change Factors> 1H Q3 9 months Revenue 361.0 (+3.1％) FY22/3 Results 8.4 7.4 15.8 Increased due to expansion of global 5G and Changes in Macro Economic - 3.5 ＋ 1.5 -2.0 Environment intellectual property (

  9. Slide 9: NEC Order Trends YoY

    9 month NEC Order Trends YoY Results  IT Services: Increased by 10% due to steady corporate demand YoY Q1 Q2 Q3 9 months Description for 9 months Favorable trend continued for urban Public Solutions +15% +13% +16% +15% infrastructure and SME* Increased demand for national defense Public Infrastruct

  10. Slide 10: II. Financial Forecasts for FY23/3

    II. Financial Forecasts for FY23/3

  11. Slide 11: FY23/3 Financial Forecasts (Jan.30)

    Forecasts FY23/3 Financial Forecasts (Jan.30) FY23/3 （Billions of Yen） Full year Change from previous FY22/3 FY23/3 YoY forecasts Actual Forecasts (Oct.28) Revenue 3,014.1 3,130.0 + 3.8% ±0.0 Adjusted Operating Profit 171.0 185.0 + 14.0 ±0.0 (Non-GAAP) % to Revenue 5.7% 5.9% Adjusted Net Profit 167.

  12. Slide 12: Financial Forecasts for FY23/3 by Segment (Jan.30)

    Forecasts Financial Forecasts for FY23/3 by Segment (Jan.30) FY23/3 （Billions of Yen） Full Year Change from previous FY22/3 FY23/3 YoY forecasts Actual Forecsts (Oct.28) Public Revenue 442.6 450.0 + 1.7% ±0.0 Adjusted Operating Profit 35.9 37.0 + 1.1 ±0.0 Solutions % to Revenue 8.1% 8.2% Public Reve

  13. Slide 13: Summary of Financial Forecasts for FY23/3

    Forecasts Summary of Financial Forecasts for FY23/3 FY23/3 Revenue and Adjusted OP forecasts as a whole company for FY23/3 remain unchanged from the previous forecast as of October 28  Domestic IT Services • Steady demand up to Q3 due to strong IT service demand • Revenue and adjusted OP expected t

  14. Slide 14: Reform of the Management Foundation to Continuously Increase Corporate Value

    Reform of the Management Foundation to Continuously Increase Corporate Value Organizational Reforms to Achieve Transition to a Company with a Nominating Committee, etc. (Subject to approval at the ordinary general meeting in June 2023) the Mid-term Management Plan 2025 (Effective as of April 1, 2023

  15. Slide 15: Orchestrating a brighter world

    \ Orchestrating a brighter world NEC

  16. Slide 16: III. Financial Results for Q3, FY23/3 (Appendix)

    III. Financial Results for Q3, FY23/3 (Appendix)

  17. Slide 17: Public Solutions Business

    Q3 Results Public Solutions Business (Billions of Yen) Revenue 1,400 112.4 1,200 97.0 102.3 Revenue 102.3 (+5.4％) 1,000 800 +5.4％  Increased due to an increase in business for SME* 600 -13.7％ and public / healthcare （YoY） （YoY） 400 200 0 * Small and Medium-sized Enterprises FY21/3 FY22/3 FY23/3 150

  18. Slide 18: Public Infrastructure Business

    Q3 Results Public Infrastructure Business (Billions of Yen) Revenue 2,000 163.5 160.8 145.1 Revenue 160.8 (+10.8％) 1,500 1,000 +10.8％  Increased in NEC Corporation due to an increase in -11.3％ （YoY） （YoY） business for satellite / defense and central 500 government 0  Increased in a consolidated su

  19. Slide 19: Enterprise Business

    Q3 Results Enterprise Business (Billions of Yen) Revenue 142.7 1,500 116.3 131.6 Revenue 142.7 (+8.4％) 1,000 +8.4％  Increased in business for retail / services and +13.1％ （YoY） （YoY） financial domains 500 0 FY21/3 FY22/3 FY23/3 200 15.8 20.0% Adjusted Operating Profit 15.8 (+3.6) Adjusted 150 Opera

  20. Slide 20: Network Services Business

    Q3 Results Network Services Business (Billions of Yen) Revenue 1,500 140.3 124.6 141.4 Revenue 141.4 (+13.5％) 1,000 +13.5％  Increased due to the expansion of global 5G -11.2％ （YoY） business and intellectual property income （YoY） 500  Same level as previous year in a consolidated 0 subsidiary* FY21

  21. Slide 21: Global Business

    Q3 Results Global Business (Billions of Yen) Revenue Revenue 154.7 (+29.6％) 2,000 154.7 1,500 105.9 119.3 +29.6％  Increased in business for Service Provider Solutions, 1,000 +12.7％ （YoY） （YoY） Submarine systems and DG/DF* 500 0 * Digital Government / Digital Finance FY21/3 FY22/3 FY23/3 Adjusted Op

  22. Slide 22: IV. Financial Results for 9 months, FY23/3 (Appendix)

    Ⅳ Financial Results for 9 months, FY23/3 (Appendix)

  23. Slide 23: Adjusted Operating Profit/Loss and Adjusted Items, etc.

    Q3 Results Adjusted Operating Profit/Loss and Adjusted Items, etc. （Billions of Yen） FY21/3 FY22/3 FY23/3 YoY Q1 Q2 Q3 9 months Q1 Q2 Q3 9 months Q1 Q2 Q3 9 months Q1 Q2 Q3 9 months Operating Profit/Loss -10.3 30.2 62.4 82.4 1.1 22.1 24.1 47.3 -15.3 29.2 43.2 57.1 -16.5 +7.1 +19.2 +9.8 Adjusted Item

  24. Slide 24: NEC Order Quarterly Trends (Including Hardware)

    Q3 Results NEC Order Quarterly Trends (Including Hardware) （YoY） FY22/3 FY23/3 前年差コメント Q1 Q2 Q3 Q3 Q1 Q2 Q3 Public Solutions -2% -4% -3% +9% +15% +13% +16% Q2: +17%, excluding large satellite Public Infrastructure +1% -12% -30% -3% +16% -10% +25% project in Q2, FY22/3 *Excluding JAE Enterprise +10%

  25. Slide 25: Public Solutions Business

    9 month Public Solutions Business Results (Billions of Yen) Revenue 315.6 3,000 290.4 286.1 Revenue 286.1 (-1.5％) 2,000 -1.5％  Decreased in business for urban infrastructure due -8.0％ to reversal impact from large projects in FY22/3 （YoY） （YoY) 1,000 despite an increase in public / healthcare and S

  26. Slide 26: Public Infrastructure Business

    9 month Public Infrastructure Business Results (Billions of Yen) Revenue 419.1 449.7 Revenue 449.7 (+8.5％) 5,000 414.4 4,000 3,000 +8.5％  Increased in NEC Corporation due to an increase in 2,000 -1.1％ （YoY） （YoY） satellite / defense business 1,000  Increased in a consolidated subsidiary* 0 FY21/3

  27. Slide 27: Enterprise Business

    9 month Enterprise Business Results (Billions of Yen) Revenue 5,000 413.8 431.5 Revenue 431.5 (+4.3％) 4,000 354.4 3,000 +4.3％  Increased due to an increase in business for +16.7％ 2,000 （YoY） （YoY） manufacturing and retail / services 1,000 0 FY21/3 FY22/3 FY23/3 Adjusted 500 42.1 20.0% Adjusted Oper

  28. Slide 28: Network Services Business

    9 month Network Services Business Results (Billions of Yen) Revenue 365.8 361.0 Revenue 361.0 (+3.1％) 4,000 350.1 3,000 +3.1％  Increased due to the expansion of global 5G 2,000 -4.3％ （YoY） business and intellectual property income （YoY） 1,000  Slightly increased YoY in a consolidated subsidiary* 0

  29. Slide 29: Global Business

    9 month Global Business Results (Billions of Yen) Revenue 5,000 422.8 Revenue 422.8 (+19.3％) 4,000 325.2 354.5 3,000  Increased due to an increase in business for Service +19.3％ +9.0％ （YoY) Provider Solutions, DG/DF and submarine systems 2,000 （YoY） 1,000 0 * Digital Government / Digital Finance FY

  30. Slide 30: Free Cash Flows

    9 months Free Cash Flows Results (Billions of Yen) -108.2 Free cash flows (Excluding special factors 40.8) -27.4 -91.6 YoY -64.2 Cash flow from operating activities 86.6 YoY -64.8 5.3 -59.5 ・ Increase in adjusted operating profit ＋7.5 ・ Increase in working capital balance and changes in receivables

  31. Slide 31: Financial Position Data

    Q3 Results Financial Position Data (Billions of Yen) End of December Change from end End of March 2022 2022 of March 2022 Total assets 3,761.7 3,889.2 + 127.5 Total equity 1,786.6 1,798.9 + 12.2 Interest-bearing debt 597.4 764.7 + 167.3 Equity attributable to owners of the parent 1,513.5 1,518.5 + 5

  32. Slide 32: Cautionary Statement with Respect to Forward-Looking Statements

    Cautionary Statement with Respect to Forward-Looking Statements This material contains forward-looking statements regarding estimations, forecasts, targets and plans in relation to the results of operations, financial conditions and other overall management of the NEC Group (the "forward-looking sta

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