Slide 1: FY10/3 Q3 Financial Results
FY10/3 Q3 Financial Results Junshi Yamaguchi President and CEO January 27, 2010 NEC Electronics Corporation http://www.necel.com/ir/en/ 1
Slide 2: Executive Summary
Executive Summary I . FY10/3 Q3 Financial Results ¾ Sustained positive free cash flows ¾ Decrease in sales of SoC was covered by increased MCU sales ¾ Operating loss improved dramatically from Q2 II . FY10/3 Forecasts ¾ Expect to see improvement in Q4 sales and profit from increase in production ¾ T
Slide 3: I. FY10/3 Q3 Financial Results / II. FY10/3 Forecasts
I. FY10/3 Q3 Financial Results II. FY10/3 Forecasts Note: This document is prepared under Japanese GAAP. 3
Slide 4: Financial Snapshot
Financial Snapshot FY10/3 (B Yen) Q3, 12/31 9 months cumulative Actual YoY QoQ Actual YoY Net Sales 117.9 -10.6 -1.2 339.2 -125.5 Semiconductor Sales 113.1 -10.7 -1.2 325.8 -119.0 Operating Income -9.3 +6.7 +6.1 -46.2 -32.9 (Loss) Ordinary Profit -11.3 +7.5 +5.1 -49.1 -30.7 (Loss) Net Income (Loss)
Slide 5: Trends in Quarterly Results - Based on Japanese GAAP
Trends in Quarterly Results- Based on Japanese GAAP 200 FY09/3 FY10/3 167.5 168.7 (B Yen) 160.4 160.6 128.5 119.1 117.9 Net Sales 123.8 102.3 114.3 113.1 Semicon. 100 85.9 Sales 98.4 81.1 Q1 Q2 Q3 Q4 Q1 Q2 Q3 3.0 2% -0.2% -13% -8% -0.3 -13% -9.3 -21% -10 OP. Income -16.0 -15.4 (Loss) -20 -21.5 OP. -
Slide 6: Q3 Semiconductor Sales by Platform
Q3 Semiconductor Sales by Platform (B Yen) SoC -16％ Sales of LSIs for consumer electronics and communications decreased 42.1 35.3 QoQ -1% Currency impact Approx. -2.5 FY10/3 Q2 FY10/3 Q3 114.3 113.1 Sales of automotive MCU +14％ products and general- purpose ICs increased 36.0 41.2 FY10/3 Q2 FY10/3 Q
Slide 7: FY10/3 Q3 Factors in Operating Income (Loss)
FY10/3 Q3 Factors in Operating Income (Loss) (B Yen) 114.3 QoQ 113.1 -1.2 Semicon. Sales +） Decrease from shifting the number of products in development +） Decrease from seasonal factor Operating Income (Loss) -9.3 Decreased R&D Approx. +6.0 Decreased GP Approx. Increased GP Approx. +) Increase from
Slide 8: Balance Sheets
Balance Sheets Note: This document is prepared under Japanese GAAP. As of As of As of (B Yen) Mar. 31, 2009 Sep. 30, 2009 Dec. 31, 2009 Cash and Cash Equivalents 101.3 89.5 95.6 Accounts Receivable 46.4 60.4 61.2 Inventories 63.2 54.5 57.1 PP&E 216.1 209.4 205.0 Other Assets 61.2 56.6 51.0 Total Ass
Slide 9: Cash Flows
Cash Flows Continuously achieved positive free cash flows in Q3 FY09/3 FY10/3 (B Yen) 9 Months 9 Months Q3 Cumulative Q2 Q3 Cumulative Cash Flows from Operating Activities 10.2 28.5 11.0 13.1 -0.8 Cash Flows from Investing Activities -7.2 -30.6 -7.3 -8.2 -32.9 Free Cash Flows 3.0 -2.0 3.7 4.9 -33.6
Slide 10: I. FY10/3 Q3 Financial Results / II. FY10/3 Forecasts
Ⅰ. FY10/3 Q3 Financial Results . Ⅱ. FY10/3 Forecasts 10
Slide 11: FY10/3 Financial Forecasts
FY10/3 Financial Forecasts The full-year forecasts remain unchanged. (Based on Japanese GAAP) FY09/3 FY10/3 (B Yen) Full Year 1H 2H Full Year Forecasts as Forecasts as Difference from Difference Difference Actual Actual from US GAAP of January 27, from US GAAP of December US GAAP 2010 24, 2009 Appro
Slide 12: Trends in Amount of Orders
Trends in Amount of Orders Amount of Orders (3-month moving average) FY10/3 Q3 Order Trends FY09/3 1H Average Steady orders on general purpose products and automotive products. FY09/3 FY10/3 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec (The company’s internal s
Slide 13: FY10/3 Q4 Semiconductor Sales Forecast
FY10/3 Q4 Semiconductor Sales Forecast (B Yen) • Increase in sales of SoC Approx. +5％ consumer electronic products QoQ 35.3 Approx. +5% FY10/3 Q3 FY10/3 Q4 e Approx. 120.0 •Steady sales of 113.1 MCU Approx. +5％ automotive products and multi-purpose MCUs 41.2 FY10/3 Q3 FY10/3 Q4 e Discrete & IC Appro
Slide 14: Factors Affecting FY10/3 Q4 Operating Income (Loss)
Factors Affecting FY10/3 Q4 Operating Income (Loss) (B Yen) QoQ Approx. 120.0 113.1 Approx. +7.0 Semicon. Sales +)Higher GP due to sales increase +）Higher GP due to increase in production exceeding sales increase Increased production at 300mm line (Q3 55% to Q4 75%) Operating Income Increased (Loss)
Slide 15: Q4 Measures
Q4 Measures Expand Sales and Achieve Profit Improvement Through Increased Production – Expand sales with MCUs in great demand – Profit improvement through increased production at 300mm line by mass production of 40/55nm products Continue to Attain Positive Free Cash Flow in 2H – Aim massive producti
Slide 16: Enhance Production for Sales Expansion and Profit Improvement
Enhance Production for Sales Expansion and Profit Improvement Expand Sales Through Increased Production Capacity Lift production Trends in MCU production ratio at 150nm line capacity at Kyushu’s 8-inch line Miniaturization MiniaturizationatatKyushu’s Kyushu’s 88–inch line 150nm –inch line ・Achieve ・
Slide 17: Improve Fab Utilization Rate at 300mm Line and Promote Miniaturization
Enhance Production for Sales Expansion and Profit Improvement Improve Fab Utilization Rate at 300mm line and Promote Miniaturization Trends in fab utilization rates at 40nm Products Yamagata’s 300mm line Fully Improve Improvefab fabutilization utilizationatat Utilization Utilized Rate Yamagata’s 300
Slide 18: Progress on 90 B Yen Fixed Cost Reduction
Progress on 90 B Yen Fixed Cost Reduction Reduced Reduced Fixed Fixed Costs Costs by by Approx. Approx. 25 25 BB Yen Yen in in FY10/3 FY10/3 Q3, Q3, YoY YoY Reduced Approx. 90B Yen Q4 as of FY09/3 Aim to Reduce Approx. 15B Yen Fixed cost Q3 Q4 Reduced Approx. 25B Yen Fixed cost Q3 Breakdown of 25 B
Slide 19: Summary
Summary ■ Promote sales expansion through production enhancement and earnings recovery by fixed-cost reduction to meet full-year financial objectives Note: This document is prepared under Japanese GAAP. 19
Slide 20: Cautionary Statements
Cautionary Statements The statements in this presentation with respect to the plans, strategies and forecasts of NEC Electronics and its consolidated subsidiaries (collectively “we”) are forward-looking statements involving risks and uncertainties. We caution you in advance that actual results could
Slide 21: Appendix: Semiconductor Sales by Application
Appendix： Semiconductor Sales by Application (B Yen) 160.4 160.6 16.5 16.4 30.2 30.8 123.8 114.3 113.1 15.5 13.5 11.3 Communications 98.4 32.5 32.3 17.1 16.9 15.8 Computing & 14.6 Peripherals 81.1 32.3 12.1 13.5 16.9 Consumer 22.8 Electronics 30.0 29.0 9.7 22.9 26.8 Auto & 20.4 23.6 23.1 Industrial
Slide 22: Major Operating Expenses and CAPEX
Major Operating Expenses and CAPEX R&D Expenses SG&A Expenses (excluding R&D Expenses) 100 100 FY10/3 Approx. FY10/3 Approx. (B yen) (B yen) 90.0 B yen 74.0 B yen (-20.0 B yen YoY) (-16.0 B yen YoY) 56.7 53.7 48.4 48.3 42.0 41.6 37.2 37.0 0 0 FY09/1H FY09/2H FY10/1H FY10/2H e FY09/1H FY09/2H FY10/1H