Oki Electric Industry Company, Limited · TSE:6703
Oki Electric Industry — H1 FY2004 Earnings Presentation
28 slides from Oki Electric Industry's earnings presentation, Oct 28, 2004
Slide 1: Financial Results for the First Half of the Fiscal Year ending March 31, 2005
Oki Electric Financial Results for the First Half of the Fiscal Year ending March 31, 2005 October 28, 2004 Oki Electric Industry Co., Ltd. 1
Slide 2: Table of Contents
Table of Contents 1. Financial Results of the Fiscal 2. Focusing Businesses Year ending March 2005 1) First Half Results 1) Three Focusing Businesses 1-1) Overview 1-1) Info-Telecom Systems 1-2) P/L 1-2) Semiconductors 1-3) B/S 1-3) Printers 2) Full Year Projections 2) Mid-term Business Target 3) Se
Slide 3: Overview of First Half Results
Overview of First Half Results Business Environment Net sales (consolidated) (Billion yen) <Economy> + 38.4 B yen (13.6%) z Continued relatively steady recovery: Increase in enterprise capital investments 250.6 281.3 319.7 and activities in digital home appliances <Oki’s Business> (Compared with pre
Slide 4: First Half Profit and Loss Outline
First Half Profit and Loss Outline z Profitable operating income due to substantial sales increase and business structural reform Comparison of consolidated P/L (Billion yen) Consolidated net sales (Billion yen) Sep. 03 Sep. 04 Variance Sep. 03 Sep. 04 Variance Info sys. 151.6 160.1 8.5 Net sales 28
Slide 5: First Half Balance Sheet Outline (1)
First Half Balance Sheet Outline (1) <Balance Sheet: Assets> (Times) Turnover ratio Sep. 03 Sep.04 Variance z Total assets decreased by 24.4 B yen from Total assets 0.91 1.07 0.16 improvement same period the previous year, due to reduction of accounts receivables and Notes and accounts 3.71 4.62 0.9
Slide 6: First Half Balance Sheet Outline (2)
First Half Balance Sheet Outline (2) <Balance Sheet: Liabilities and Shareholders’ Equity> (%) z Interest bearing debt decreased by 52.3 B Sep. 03 Sep.04 Variance yen from same period the previous year, Interest-bearing 53.5 46.8 6.7 improvement due to improvement in cash flows debt ratio Shareholde
Slide 7: Premises of Full Year Projections
Premises of Full Year Projections <Economy forecast> • While enterprise capital investment expands and consumer spending remains steady, economy outlook is unclear • Concerns include pricing pressure from fiercer competition and impact on economy from rising oil price <Market trend> • Info systems:
Slide 8: Causes of Changes in Operating Income
Causes of Changes in Operating Income Cause of 7.4 B yen increase from the previous year in operating income z Increase capital investment and R&D for future business development z Sales increase and procurement cost reduction offset causes of profit decline including price down, strong yen, and inv
Slide 9: Full Year Projection by Segments
Full Year Projection by Segments z Achieve increase in sales and income relative to the previous fiscal year <Full year projection> <First half results> Net sales (Comparison from last FY) (Billion yen) Net sales (Billion yen) Others 319.7 710.0 310.0 654.2 680.0 Increase in sales from EMS 281.3 27.
Slide 10: Full Year Projection: Info Systems
Full Year Projection: Info Systems z Demand related to new banknote mostly ends in the 1st half. Though sales decrease was partly offset by sales from financial IT solutions and color printers, operating income decreased on an year-on-year basis due to R&D increase <Full year projection> <First half
Slide 11: Full Year Projection: Telecom Systems
Full Year Projection: Telecom Systems z Increase in both sales and operating income backed by carriers’ investments on networks z Enhance R&D investments for future growth <Full year projection> <First half results> (Billion yen) Net sales Net sales (Comparison from last FY) (Billion yen) 130.0 52.1
Slide 12: Full Year Projection: Electronic Devices
Full Year Projection: Electronic Devices z Demand increase in personal and mobile markets. Though unclear outlook in the second half, sales increase is expected z Increase in operating income due to sales increase and structural reform in optical components business <Full year projection> <First hal
Slide 13: Cash Flows
Cash Flows z Free cash flows (FCF) improved 12.3 B yen from previous projections (July 28) due to decrease in operating assets and liabilities, etc. Full year FCF also expected to improve by 5.0 B yen FY Mar. 04 FY Mar. 05 FY Mar. 05 (results) (results/projections) (July 28 project.) (Billion yen) 1
Slide 14: Acquisitions of Property, Plant and Equipment; R&D Expenses
Acquisitions of Property, Plant and Equipment; R&D Expenses Acquisitions of Property, Plant and equip. R&D expenses (Billion yen) (Billion yen) (Including leased assets) 30.0 40.0 Common 35.0 36.0 Common Devices Devices Telecom 5.0 23.0 4.5 Telecom Info systems Info systems 20.0 2.9 26.8 25.3 20.0 2
Slide 15: Number of Employees
Number of Employees To respond to changes in business environment, promote optimal human resource allocation • Actively promote mid-career recruiting as immediate workforce for focusing businesses Æ Increase 200 employees in FY ending Mar. 05, a three fold increase from previous years • Put brakes o
Slide 16: Three Focusing Businesses
Three Focusing Businesses Restructure business targeting FY ending Mar. 2007 Info-Telecom System business Enhance solution provisioning for each market based on information and telecom convergence, AP@PLAT Semiconductor business Printer business Strengthen to provide unique Increase world market sha
Slide 17: Info-Telecom System Business
Info-Telecom System Business FY ending Mar. 2007 target: Net sales 400 B yen, Operating income 35 B yen Financial Central and Local Sales target for Telecom Carriers Enterprises FY ending Mar. 07 Institutions Governments 150 B yen 100 B yen 70 B yen 80 B yen “Obediently provide products that custome
Slide 18: [Info-Telecom] Financial Market Solutions
[Info-Telecom] Financial Market Solutions New banknote-related demand ends in the 1st half of the FY Mar. 2005 Increase R&D investment for new business deployment for the FY Mar. 2006 and after Expand solution business and strengthen ATM business (market share: 40%) further [Business Strategy] z Enh
Slide 19: [Info-Telecom] Telecom Carrier Solutions
[Info-Telecom] Telecom Carrier Solutions Telecom Carriers Investment Trends z Active investment towards backbone network accelerates/ Local IP network expands as B-FLETS sales increase/ Optical access investment increases Æ Full scale introduction of GE-PON z Full scale CPE sales expansion as optica
Slide 20: [Info-Telecom] Government Solutions
[Info-Telecom] Government Solutions Focus on large projects based on e-Japan II Strategy • Deploy e-government solutions with security as a core for applications and networks 9Focus on government portals/ mission critical systems / government official portal based on AP@PLAT • Focus on ITS related s
Slide 21: [Info-Telecom] Enterprise Solutions
[Info-Telecom] Enterprise Solutions z Enterprise-use info-telecom system market expands rapidly as info and telecom converges z Progress of network convergence in channel systems such as ticket reservation and issuing systems and KIOSKs z Increase sales based on Oki’s top share in VoIP, call center
Slide 22: Semiconductor Business
Semiconductor Business FY ending Mar. 2007 target: Net sales 170 B yen, Operating income 17 B yen Growth strategy with advanced technologies Establish business structure strong to market changes and to generate profit (BEP: 110.0 B yen strategy) Converge semiconductor technology and system technolog
Slide 23: [Semiconductors] Product Strategy
[Semiconductors] Product Strategy Expand business through advanced technologies such as low power consumption, high voltage process, SOI/SOS, etc. Expand products by converging internal system technologies (information/ telecom) (ZigBee, VoIP, analog-mixed) Enhance product planning and development t
Slide 24: Printer Business
Printer Business FY ending Mar. 2007 target: Net sales 180 B yen, Operating income 15 B yen Color NIP: ¾ Dell joining the market stimulates the color NIP market ¾ Achieve 20% worldwide market share utilizing LED advantages (compact, high speed, high quality) SIDM: ¾ Maximize profit by increasing SID
Slide 25: [Printer] Business Domain
[Printer] Business Domain Deploy business targeting office use for SOHO/ enterprises Printer market (hardware shipment) (Billion$) (by JEITA) 18% annual growth in color NIP/ MFP 50 SIDM CAGR -8% 40 Inkjet CAGR 1% Stable business in SIDM mainly for specific applications, expand Chinese 30 market 20 M
Slide 26: [Printers] Color NIP Market Share
[Printers] Color NIP Market Share Europe and US market share increases steadily from FY ending March 2004 Rank into high market share group in major countries <Accumulated color NIP shipment in Europe and US> <Market share by major countries> IDC Jan-Jun/04 (K) (Since January 2002) Oki’s share Line
Slide 27: Mid-term Business Target [New Business Segment]
Mid-term Business Target [New Business Segment] 3.8 <Sales/ Operating income ratio> (Billion yen) 5.3 0.2 3.3 4.1 800 740.2 760.0 (%) (4.5) 710.0 Others 10.0 57.8 654.2 73.0 110.0 604.4 585.5 59.0 Printers 180.0 600 48.9 140.0 53.4 124.8 170.2 112.0 108.0 Semiconductors 170.0 400 104.9 130.3 152.0 1
Slide 28: Glossary
Glossary P3 IP Internet Protocol P20 ETC Electronic Toll Collection P7 IT Information Technology PDA Personal Digital Assistance LSI Large Scale Integration PSTN Public Switched Telephone Network P8 R&D Research and Development CRM Customer Relationship Management P9 EMS Electric Manufacturing Servi
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