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Kyocera 6-K 2010

Documents found in this filing:

  1. 6-K
  2. 6-K
Form 6-K
Table of Contents

FORM 6-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16 of

the Securities Exchange Act of 1934

For the month of January 2010

Commission File Number: 1-07952

KYOCERA CORPORATION

6 Takeda Tobadono-cho, Fushimi-ku,

Kyoto 612-8501, Japan

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F        X            Form 40-F                

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Registration S-T Rule 101(b)(1):    

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Registration S-T Rule 101(b)(7):    

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes                        No        X    

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b); 82-                    


Table of Contents

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereto duly authorized.

 

KYOCERA CORPORATION

/s/ Shoichi Aoki

Shoichi Aoki
Director,
Managing Executive Officer and General Manager of
Corporate Financial & Accounting Group

Date: January 28, 2010


Table of Contents

Information furnished on this form:

EXHIBITS

 

    Exhibit    
    Number    

   

1.

  Consolidated Financial Results of Kyocera Corporation and its Subsidiaries for the Nine Months Ended December 31, 2009

2.

  Revision of Financial Forecast for the Fiscal Year Ending March 31, 2010


Table of Contents

Consolidated Financial Results of Kyocera Corporation and its Subsidiaries

for the Nine Months Ended December 31, 2009

The consolidated information is prepared using accounting principles generally accepted in the United States of America.

1. Consolidated Financial Results for the Nine Months Ended December 31, 2009:

(1) Consolidated results of operations:

 

     (Yen in millions, except per share amounts)  
     Nine months ended December 31,  
     2008     2009  

Net sales

   ¥ 902,577      ¥ 768,920   

% change from the previous period

     (6.6 )%      (14.8 )% 

Profit from operations

     67,257        38,013   

% change from the previous period

     (38.9 )%      (43.5 )% 

Income before income taxes

     82,409        32,739   

% change from the previous period

     (37.6 )%      (60.3 )% 

Net income attributable to shareholders of Kyocera Corporation

     56,768        18,481   

% change from the previous period

     (32.0 )%      (67.4 )% 

Earnings per share:

    

Net income attributable to shareholders of Kyocera Corporation

    

Basic

     300.39        100.70   

Diluted

     300.30        100.70   

 

Net income attributable to shareholders of Kyocera Corporation is computed in the same manner as net income for the year ended March 31, 2009.

 

(2) Consolidated financial position:

 

   

  

     (Yen in millions, except per share amounts)  
     March 31, 2009     December 31, 2009  

Total assets

   ¥ 1,773,802      ¥ 1,791,467   

Kyocera Corporation shareholders’ equity

     1,323,663        1,321,194   

Kyocera Corporation shareholders’ equity to total assets

     74.6     73.7

Kyocera Corporation shareholders’ equity per share

     7,212.32        7,199.05   

 

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Table of Contents

2. Dividends:

 

     (Yen)  
     Year ended
March 31, 2009
   Year ending
March 31, 2010
 

Interim dividends per share

   ¥ 60    ¥ 60    

Year-end dividends per share

     60      60  (forecast) 

Annual dividends per share

     120      120  (forecast) 

3. Consolidated Financial Forecast for the Year Ending March 31, 2010:

 

     (Yen in millions, except per share amounts)  
     Year ending March 31, 2010  

Net sales

   ¥ 1,050,000   

% change from the previous year

     (7.0 )% 

Profit from operations

     62,000   

% change from the previous year

     42.8

Income before income taxes

     57,000   

% change from the previous year

     1.8

Net income attributable to shareholders of Kyocera Corporation

     34,000   

% change from the previous year

     15.2

Forecast of earnings per share attributable to shareholders of Kyocera Corporation:

     185.26   

Net income attributable to shareholders of Kyocera Corporation is computed in the same manner as net income for the year ended March 31, 2009.

Forecast of earnings per share attributable to shareholders of Kyocera Corporation is computed based on the diluted average number of shares outstanding during the nine months ended December 31, 2009.

 

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Table of Contents

4. Others:

(1) Increase or decrease in significant subsidiaries during the nine months ended December 31, 2009:

None.

(2) Adoption of concise quarterly accounting method or procedure:

Not applicable.

(3) Changes in accounting principles, procedures and financial statements’ presentation:

Changes due to adoption of new accounting standards:

Please refer to the accompanying “4. Other Information” on page 16.

Changes due to other than adoption of new accounting standards:

None.

(4) Number of shares (common stock):

 

     March 31, 2009    December 31, 2009

Number of shares issued

   191,309,290    191,309,290

Number of shares in treasury

   7,781,256    7,785,812
     Nine months ended December 31,
     2008    2009

Average number of shares outstanding

   188,981,494    183,525,500

Instruction for forecasts and other notes:

With regard to the premise of the forecasts set forth elsewhere in this Form 6-K, please refer to the accompanying “3. Consolidated Financial Forecasts for the Year Ending March 31, 2010” on page 13 and “Forward-Looking Statements” on page 15.

 

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Table of Contents

Business Results, Financial Conditions and Prospects

1. Business Results for the Nine Months Ended December 31, 2009

(1) Economic Situation and Business Environment

In the nine months ended December 31, 2009 (the “nine months”), the European and U.S. economies recovered moderately and the Chinese economy continued to recover strongly supported by economic stimulus packages and financial measures in various countries. Despite increases in corporate production activities along with recovery in exports, the Japanese economy fell short of a full-fledged recovery due to a low level of capital investment and the absence of significant improvement in employment situation and consumer spending.

Amid this economic environment, in the digital consumer equipment market which is a principal market for Kyocera Corporation and its consolidated subsidiaries (“Kyocera Group” or “Kyocera”), production activities showed signs of recovery, notably for mobile phone handsets and personal computers (PCs), due to the end of inventory adjustments. In line with this, orders in the Components Business for the three months ended December 31, 2009 increased year-on-year for the first time in the most recent five quarters, although total orders for the nine months fell short of those for the nine months ended December 31, 2008 (the “previous nine months”).

(2) Consolidated Financial Results

Although demand for components in the three months ended December 31, 2009 showed signs of recovery exceeding the level of the three months ended December 31, 2008, it nonetheless declined overall compared with the previous nine months, reflecting the fact that demand for components for the six months ended September 30, 2009 was below that for the six months ended September 30, 2008. Also, in the Equipment Business, sales of mobile phone handsets and information equipment decreased, and the yen appreciated against the Euro and U.S. dollar. As a result, consolidated net sales for the nine months decreased by 14.8% compared with the previous nine months to ¥768,920 million.

In this business environment, Kyocera promoted cost-cutting measures including reducing manufacturing costs; and worked hard to improve productivity throughout the Kyocera Group. Despite these efforts, profit from operations for the nine months was down 43.5% compared with the previous nine months to ¥38,013 million due primarily to a decline in sales. As Kyocera recognized an impairment loss of ¥19,987 million on its investment in WILLCOM, Inc., an affiliate accounted for by the equity method, in equity in losses of affiliates and unconsolidated subsidiaries, income before income taxes for the nine months decreased by 60.3% compared with the previous nine months to ¥32,739 million, and net income attributable to shareholders of Kyocera Corporation for the nine months amounted to ¥18,481 million, a decrease of 67.4% compared with the previous nine months.

Average exchange rates for the nine months were ¥94 to the U.S. dollar and ¥133 to the Euro, marking appreciation by ¥9 (approximately 9%) and ¥18 (approximately 12%), respectively, compared with those for the previous nine months. As a result of the yen’s appreciation, net sales and income before income taxes after translation into yen for the nine months were down by approximately ¥48.5 billion and ¥13.5 billion, respectively, compared with the previous nine months.

 

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Table of Contents

Consolidated Financial Results for the Nine Months Ended December 31

 

      (Yen in millions, except per share amounts and exchange rates)  
     Nine months ended December 31,    Increase
(Decrease)
%
 
     2008    2009   
     Amount    %    Amount    %   

Net sales

   ¥ 902,577    100.0    ¥ 768,920    100.0    (14.8

Profit from operations

     67,257    7.5      38,013    4.9    (43.5

Income before income taxes

     82,409    9.1      32,739    4.3    (60.3

Net income attributable to shareholders of Kyocera Corporation

     56,768    6.3      18,481    2.4    (67.4

Diluted earnings per share attributable to shareholders of Kyocera Corporation

     300.30    —        100.70    —      —     

Average US$ exchange rate

     103    —        94    —      —     

Average Euro exchange rate

     151    —        133    —      —     

Consolidated Financial Results for the Three Months Ended December 31

 

     (Yen in millions, except per share amounts and exchange rates)  
     Three months ended December 31,    Increase
(Decrease)
%
 
     2008    2009   
     Amount    %    Amount    %   

Net sales

   ¥ 243,860    100.0    ¥ 285,017    100.0    16.9   

Profit from operations

     5,028    2.1      29,155    10.2    479.9   

Income before income taxes

     8,401    3.4      15,591    5.5    85.6   

Net income attributable to shareholders of Kyocera Corporation

     11,519    4.7      9,753    3.4    (15.3

Diluted earnings per share attributable to shareholders of Kyocera Corporation

     61.37    —        53.14    —      —     

Average US$ exchange rate

     96    —        90    —      —     

Average Euro exchange rate

     127    —        133    —      —     

Note:

Net income attributable to shareholders of Kyocera Corporation is computed in the same manner as net income for the year ended March 31, 2009.

 

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Table of Contents

(3) Consolidated results by reporting segment

(i) Components Business:

For the nine months, sales in the Components Business decreased by 17.9% to ¥393,075 million, and operating profit decreased by 46.7% to ¥25,304 million, compared with the previous nine months.

1) Fine Ceramic Parts Group

This reporting segment includes fine ceramic parts and automotive components.

Demand for digital consumer equipment parts, such as sapphire substrates for LEDs, has been on a recovery track since April 2009, and demand for semiconductor fabrication equipment components and automotive components began to recover from October 2009 as well. However, such demand remained at a low level compared with the previous nine months, and as a result, sales and operating profit in this reporting segment both decreased for the nine months compared with the previous nine months.

2) Semiconductor Parts Group

This reporting segment includes ceramic packages and organic packages, etc.

Demand for ceramic packages for crystal and SAW devices and for CCD/CMOS image sensors was strong, in line with a resurgence in production of mobile phone handsets and digital cameras, etc. In addition, demand for organic packages showed signs of recovery. However, sales and operating profit for the nine months decreased in this reporting segment, falling short of the levels recorded in the previous nine months.

3) Applied Ceramic Products Group

This reporting segment includes solar power generating systems, cutting tools, medical and dental implants, as well as jewelry and applied ceramic related products.

For the solar energy business, despite rapid expansion of demand in the Japanese market on the back of governmental subsidy policies, overall sales in this business for the nine months remained roughly unchanged from the previous nine months due to price declines in European and U.S. markets, coupled with appreciation of the yen. In addition, sales in the cutting tool business were sluggish compared with the previous nine months because recovery in production activities in automotive related industries, the principle market for the cutting tool business, remained moderate. As a result, overall sales and operating profit in this reporting segment both decreased compared with the previous nine months.

4) Electronic Device Group

This reporting segment includes electronic components such as various types of capacitors, crystal related products and connectors, and thin-film products such as thermal printheads.

Although demand for ceramic capacitors, crystal-related products and connectors has increased since April 2009 due to recovery in digital consumer equipment production activities, sales fell short of levels recorded in the previous nine months. Operating profit increased compared with the previous nine months, however, as a result of efforts to reduce costs throughout the Kyocera Group.

 

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Table of Contents

(ii) Equipment Business:

Sales in the Equipment Business for the nine months decreased by 12.5% to ¥302,068 million, and operating profit increased by 110.4% to ¥8,298 million compared with the previous nine months.

1) Telecommunications Equipment Group

This reporting segment includes mobile phone handsets and PHS related products, etc.

Sales in this reporting segment for the nine months decreased compared with the previous nine months amid a tough business environment due to weakened replacement demand for mobile phone handsets in the Japanese market and a decrease in sales of mobile phone handsets in the U.S. market, despite efforts to expand sales of new models. Operating loss for the nine months was reduced compared with the previous nine months by improvement in profitability through streamlining operations, including reorganization of sales and development systems, and cost reductions.

2) Information Equipment Group

This reporting segment includes ECOSYS brand printers and digital MFPs, etc.

Stagnant global demand caused by a severe curtailment of information technology investment, coupled with a decline in selling prices and appreciation of the yen for the nine months, led to a decrease in sales compared with the previous nine months. Nonetheless, operating profit for the nine months increased compared with the previous nine months due to cost reductions combined with the recording of a gain from a sale of a real estate overseas.

(iii) Others

This reporting segment includes various information and communications technology services and materials for electronic components, etc.

Sales in this reporting segment decreased by 7.4% compared with the previous nine months to ¥89,753 million, due primarily to a decrease in demand for the Information and Communication Technologies (ICT) business and telecommunications engineering business, as well as for materials for electronic components caused by stagnation in production of various electronic devices. Operating profit for the nine months decreased by 74.4% compared with the previous nine months to ¥3,907 million due to the decline in sales and the absence of gains from sales of real estates as recorded in the previous nine months in the amount of approximately ¥10.6 billion.

 

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Table of Contents

Net Sales by Reporting Segment for the Nine Months Ended December 31

 

     (Yen in millions)  
     Nine months ended December 31,     Increase
(Decrease)
%
 
     2008     2009    
     Amount     %     Amount     %    

Fine Ceramic Parts Group

   ¥ 52,122      5.8      ¥ 36,387      4.7      (30.2

Semiconductor Parts Group

     113,459      12.6        99,641      13.0      (12.2

Applied Ceramic Products Group

     122,431      13.5        111,510      14.5      (8.9

Electronic Device Group

     190,523      21.1        145,537      18.9      (23.6
                                  

Total Components Business

     478,535      53.0        393,075      51.1      (17.9

Telecommunications Equipment Group

     169,785      18.8        131,408      17.1      (22.6

Information Equipment Group

     175,380      19.4        170,660      22.2      (2.7
                                  

Total Equipment Business

     345,165      38.2        302,068      39.3      (12.5

Others

     96,973      10.8        89,753      11.7      (7.4

Adjustments and eliminations

     (18,096   (2.0     (15,976   (2.1   —     
                                  

Net sales

   ¥ 902,577      100.0      ¥ 768,920      100.0      (14.8
                                  
Operating Profit (Loss) by Reporting Segment for the Nine Months Ended December 31   
     (Yen in millions)  
     Nine months ended December 31,     Increase
(Decrease)
%
 
     2008     2009    
     Amount     %*     Amount     %*    

Fine Ceramic Parts Group

   ¥ 2,492      4.8      ¥ (2,567   —        —     

Semiconductor Parts Group

     11,883      10.5        10,447      10.5      (12.1

Applied Ceramic Products Group

     27,994      22.9        10,909      9.8      (61.0

Electronic Device Group

     5,136      2.7        6,515      4.5      26.8   
                                  

Total Components Business

     47,505      9.9        25,304      6.4      (46.7

Telecommunications Equipment Group

     (10,651   —          (6,426   —        —     

Information Equipment Group

     14,594      8.3        14,724      8.6      0.9   
                                  

Total Equipment Business

     3,943      1.1        8,298      2.7      110.4   

Others

     15,241      15.7        3,907      4.4      (74.4
                                  

Operating profit

     66,689      7.4        37,509      4.9      (43.8
                                  

Corporate

     10,795      —          13,425      —        24.4   

Equity in earnings (losses) of affiliates and unconsolidated subsidiaries

     4,905      —          (18,195   —        —     

Adjustments and eliminations

     20      —          0      —        (100.0
                                  

Income before income taxes

   ¥ 82,409      9.1      ¥ 32,739      4.3      (60.3
                                  

 

* % to net sales of each corresponding segment

 

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Table of Contents

Net Sales by Reporting Segment for the Three Months Ended December 31

 

     (Yen in millions)  
     Three months ended December 31,     Increase
(Decrease)
%
 
     2008     2009    
     Amount     %     Amount     %    

Fine Ceramic Parts Group

   ¥ 14,777      6.1      ¥ 14,866      5.2      0.6   

Semiconductor Parts Group

     31,187      12.8        37,425      13.1      20.0   

Applied Ceramic Products Group

     36,178      14.8        44,627      15.7      23.4   

Electronic Device Group

     52,505      21.5        51,076      17.9      (2.7
                                  

Total Components Business

     134,647      55.2        147,994      51.9      9.9   

Telecommunications Equipment Group

     34,367      14.1        51,659      18.1      50.3   

Information Equipment Group

     49,643      20.3        59,509      20.9      19.9   
                                  

Total Equipment Business

     84,010      34.4        111,168      39.0      32.3   

Others

     30,667      12.6        31,928      11.2      4.1   

Adjustments and eliminations

     (5,464   (2.2     (6,073   (2.1   —     
                                  

Net sales

   ¥ 243,860      100.0      ¥ 285,017      100.0      16.9   
                                  
Operating Profit (Loss) by Reporting Segment for the Three Months Ended December 31   
     (Yen in millions)  
     Three months ended December 31,     Increase
(Decrease)
%
 
     2008     2009    
     Amount     %*     Amount     %*    

Fine Ceramic Parts Group

   ¥ (394   —        ¥ 1,016      6.8      —     

Semiconductor Parts Group

     1,158      3.7        5,977      16.0      416.1   

Applied Ceramic Products Group

     7,266      20.1        6,545      14.7      (9.9

Electronic Device Group

     (897   —          6,187      12.1      —     
                                  

Total Components Business

     7,133      5.3        19,725      13.3      176.5   

Telecommunications Equipment Group

     (8,278   —          1,077      2.1      —     

Information Equipment Group

     2,395      4.8        6,364      10.7      165.7   
                                  

Total Equipment Business

     (5,883   —          7,441      6.7      —     

Others

     1,372      4.5        2,109      6.6      53.7   
                                  

Operating profit

     2,622      1.1        29,275      10.3      —     
                                  

Corporate

     4,560      —          6,113      —        34.1   

Equity in earnings (losses) of affiliates and unconsolidated subsidiaries

     1,347      —          (19,692   —        —     

Adjustments and eliminations

     (128   —          (105   —        —     
                                  

Income before income taxes

   ¥ 8,401      3.4      ¥ 15,591      5.5      85.6   
                                  

 

* % to net sales of each corresponding segment

 

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Table of Contents

(4) Net Sales by Geographic Area

1) Japan

Sales decreased compared with the previous nine months due to a decline in sales in the Telecommunications Equipment Group, especially mobile phone handsets, and to a decline in components demand as a whole, although sales increased substantially in the solar energy business in the Applied Ceramic Products Group.

2) Europe

Sales decreased compared with the previous nine months due mainly to a decline in sales of the Electronic Device Group and the Applied Ceramic Products Group, coupled with the impact of appreciation of the yen, although sales increased in the Information Equipment Group due to a contribution by new subsidiaries.

3) United States of America

Sales decreased compared with the previous nine months due mainly to a decline in sales in mobile phone handsets in the Telecommunications Equipment Group and to a decline in components demand in the Electronic Device Group.

4) Asia

Sales decreased compared with the previous nine months due mainly to a decline in demand for components for digital consumer equipment in the Electronic Device Group.

5) Others

Sales decreased compared with the previous nine months due to sales decline in the Telecommunications Equipment Group and the Information Equipment Group.

 

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Table of Contents

Net Sales by Geographic Area for the Nine Months Ended December 31

 

     (Yen in millions)  
     Nine months ended December 31,    Increase
(Decrease)
%
 
     2008    2009   
     Amount    %    Amount    %   

Japan

   ¥ 370,829    41.1    ¥ 330,167    42.9    (11.0

Europe

     161,074    17.8      147,068    19.1    (8.7

United States of America

     162,057    18.0      128,159    16.7    (20.9

Asia

     152,202    16.9      126,670    16.5    (16.8

Others

     56,415    6.2      36,856    4.8    (34.7
                              

Net sales

   ¥ 902,577    100.0    ¥ 768,920    100.0    (14.8
                              
Net Sales by Geographic Area for the Three Months Ended December 31   
     (Yen in millions)  
     Three months ended December 31,    Increase
(Decrease)

%
 
     2008    2009   
     Amount    %    Amount    %   

Japan

   ¥ 101,661    41.7    ¥ 130,451    45.8    28.3   

Europe

     42,996    17.6      53,318    18.7    24.0   

United States of America

     44,883    18.4      43,409    15.2    (3.3

Asia

     40,368    16.6      44,514    15.6    10.3   

Others

     13,952    5.7      13,325    4.7    (4.5
                              

Net sales

   ¥ 243,860    100.0    ¥ 285,017    100.0    16.9   
                              

 

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Table of Contents

2. Consolidated Financial Position

Consolidated Cash Flows

Cash and cash equivalents at December 31, 2009 increased by ¥29,386 million to ¥298,633 million compared with those at March 31, 2009.

(1) Cash flows from operating activities

Net cash provided by operating activities in this nine months decreased by ¥711 million to ¥68,990 million from ¥69,701 million in the previous nine months. This change in operating cash flows is primarily attributable to the increase in trade accounts receivable, trade notes and accounts payable and the decrease in net income.

(2) Cash flows from investing activities

Net cash used in investing activities turned from ¥191,257 million of cash outflows in the previous nine months to ¥3,619 million of cash inflows in this nine months. This was due mainly to decreases in payments for property, plant and equipment and intangible assets, and acquisitions of businesses as well as an increase in withdrawal of certificate deposits and time deposits.

(3) Cash flows from financing activities

Net cash used in financing activities in this nine months decreased by ¥21,619 million to ¥36,701 million from ¥58,320 million in the previous nine months. This was due mainly to a significant decrease in payments for acquisition of treasury stock.

Consolidated Cash Flows for the Nine Months Ended December 31

 

     (Yen in millions)  
     Nine months ended December 31,  
     2008     2009  

Cash flows from operating activities

   ¥ 69,701      ¥ 68,990   

Cash flows from investing activities

     (191,257     3,619   

Cash flows from financing activities

     (58,320     (36,701

Effect of exchange rate changes on cash and cash equivalents

     (22,702     (6,522

Net increase (decrease) in cash and cash equivalents

     (202,578     29,386   

Cash and cash equivalents at beginning of year

     447,586        269,247   

Cash and cash equivalents at end of period

   ¥ 245,008      ¥ 298,633   
Consolidated Cash Flows for the Three Months Ended December 31     
     (Yen in millions)  
     Three months ended December 31,  
     2008     2009  

Cash flows from operating activities

   ¥ 2,221      ¥ 1,184   

Cash flows from investing activities

     (24,345     8,623   

Cash flows from financing activities

     (44,129     (13,568

Effect of exchange rate changes on cash and cash equivalents

     (24,565     2,766   

Net decrease in cash and cash equivalents

     (90,818     (995

Cash and cash equivalents at beginning of period

     335,826        299,628   

Cash and cash equivalents at end of period

   ¥ 245,008      ¥ 298,633   

 

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3. Consolidated Financial Forecasts for the Year Ending March 31, 2010

Demand for components has been on a steady recovery track in the nine months due to recovery in production activities in the digital consumer equipment market since April 2009, coupled with a return to expansion in production activities in the semiconductor and automotive related markets from the three months ended December 31, 2009. In addition, the solar energy market was on an upward trend, particularly in Japan, and sales on the whole were solid for the nine months. In terms of profit, Kyocera was able to achieve an improvement in profitability disproportionate to the recovery in sales as a result of efforts throughout the Kyocera Group from April 2009 to comprehensively reduce costs and improve productivity, as well as a recovery in demand for components. In the three months ending March 31, 2010, Kyocera will strive to expand businesses despite uncertainty in the global economy, exchange rate trends and other factors, by exploiting the collective power of the Kyocera Group to seize all opportunities for growth in the information and communications market and the environment and energy market.

In light of results for the nine months ended December 31, 2009 and the outlook for the three months ending March 31, 2010, Kyocera has made the following revisions to the consolidated financial forecasts for the year ending March 31, 2010 announced in October 2009.

Kyocera will strive to achieve full-year financial forecasts by aggressively acquiring orders for products in which demand growth is expected to continue, as well as reducing costs and improving productivity.

Consolidated Forecasts for the Year Ending March 31, 2010

 

     (Yen in millions, except per share amounts and exchange rates)  
     Results for the year
ended March 31, 2009
   Forecasts for the year ending March 31, 2010
announced on
   Increase
(Decrease) to
Results

%
 
          October 30, 2009        January 28, 2010     

Net sales

   ¥ 1,128,586    ¥ 1,040,000    ¥ 1,050,000    (7.0

Profit from operations

     43,419      44,000      62,000    42.8   

Income before income taxes

     55,982      57,000      57,000    1.8   

Net income attributable to shareholders
of Kyocera Corporation

     29,506      34,000      34,000    15.2   

Diluted earnings per share attributable
to shareholders of Kyocera Corporation

     157.23      185.26      185.26    —     

Average US$ exchange rate

     101      92      92    —     

Average Euro exchange rate

     143      129      131    —     
                           

Notes:

1. Net income attributable to shareholders of Kyocera Corporation is computed in the same manner as net income for the year ended March 31, 2009.
2. Forecast of diluted earnings per share attributable to shareholders of Kyocera Corporation announced on January 28, 2010 is computed based on the diluted average number of shares outstanding during the nine months ended December 31, 2009.
3. The forecast of diluted earnings per share announced previously was computed based on the diluted average number of shares outstanding during the six months ended September 30, 2009.
4. On September 24, 2009, WILLCOM, Inc. applied for Alternative Dispute Resolution (ADR) process, and received acceptance for the ADR procedure. At December 31, 2009, the business revitalization plan continues to be under discussion and has not been resolved. The result of resolution may affect the valuation of Kyocera’s trade receivables from WILLCOM, Inc. and may have a material effect on Kyocera’s consolidated results of operations and financial position, which has not yet been reflected in the consolidated financial forecast set forth above. At December 31, 2009, Kyocera’s trade receivables from WILLCOM, Inc. were ¥ 15,350 million.

 

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Consolidated Forecasts of Net Sales by Reporting Segment for the Year Ending March 31, 2010

 

     (Yen in millions)  
     Results for the year
ended March 31, 2009
    Forecasts for the year ending March 31, 2010
announced on
    Increase
(Decrease) to
Results

%
 
       October 30, 2009     January 28, 2010    
     Amount     %     Amount     %     Amount     %    

Fine Ceramic Parts Group

   ¥ 61,730      5.4      ¥ 48,000      4.6      ¥ 52,000      4.9      (15.8

Semiconductor Parts Group

     135,137      12.0        127,000      12.2        135,000      12.9      (0.1

Applied Ceramic Products Group

     148,917      13.2        148,000      14.2        154,000      14.7      3.4   

Electronic Device Group

     231,271      20.5        190,000      18.3        194,000      18.5      (16.1
                                                

Total Components Business

     577,055      51.1        513,000      49.3        535,000      51.0      (7.3

Telecommunications Equipment Group

     218,758      19.4        196,000      18.9        184,000      17.5      (15.9

Information Equipment Group

     229,297      20.3        229,000      22.0        229,000      21.8      (0.1
                                                

Total Equipment Business

     448,055      39.7        425,000      40.9        413,000      39.3      (7.8

Others

     126,043      11.2        122,000      11.7        124,000      11.8      (1.6

Adjustments and eliminations

     (22,567   (2.0     (20,000   (1.9     (22,000   (2.1   —     
                                                

Net sales

   ¥ 1,128,586      100.0      ¥ 1,040,000      100.0      ¥ 1,050,000      100.0      (7.0
                                                
Consolidated Forecasts of Operating Profit (Loss) by Reporting Segment for the Year Ending March 31, 2010   
     (Yen in millions)  
     Results for the year
ended March 31, 2009
    Forecasts for the year ending March 31, 2010
announced on
    Increase
(Decrease) to
Results

%
 
     October 30, 2009     January 28, 2010    
     Amount     %*     Amount     %*     Amount     %*    

Fine Ceramic Parts Group

   ¥ (240   —        ¥ 0      0.0      ¥ 0      0.0      —     

Semiconductor Parts Group

     8,671      6.4        10,500      8.3        15,000      11.1      73.0   

Applied Ceramic Products Group

     27,469      18.4        11,500      7.8        17,000      11.0      (38.1

Electronic Device Group

     (4,070   —          5,500      2.9        11,500      5.9      —     
                                                

Total Components Business

     31,830      5.5        27,500      5.4        43,500      8.1      36.7   

Telecommunications Equipment Group

     (17,713   —          (6,000   —          (5,000   —        —     

Information Equipment Group

     13,497      5.9        15,000      6.6        19,000      8.3      40.8   
                                                

Total Equipment Business

     (4,216   —          9,000      2.1        14,000      3.4      —     

Others

     14,106      11.2        3,800      3.1        5,500      4.4      (61.0
                                                

Operating profit

     41,720      3.7        40,300      3.9        63,000      6.0      51.0   

Corporate and others

     14,262      —          16,700      —          (6,000   —        —     
                                                

Income before income taxes

   ¥ 55,982      5.0      ¥ 57,000      5.5      ¥ 57,000      5.4      1.8   
                                                

 

* % to net sales of each corresponding segment

 

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Forward-Looking Statements

Certain of the statements made in this document are forward-looking statements (within the meaning of Section 21E of the U.S. Securities and Exchange Act of 1934), which are based on our current assumptions and beliefs in light of the information currently available to us. These forward-looking statements involve known and unknown risks, uncertainties and other factors. Such risks, uncertainties and other factors include, but are not limited to the following lists.

 

(1) General economic conditions in our markets, which are primarily Japan, North America, Europe and Asia, particularly China

 

(2) Unexpected changes in economic, political and legal conditions in China

 

(3) Our ability to develop, launch and produce innovative products, including meeting quality and delivery standards, and our ability to otherwise meet the advancing technological requirements of our customers, particularly in the highly competitive markets for ceramics, semiconductor parts and electronic components

 

(4) Manufacturing delays or defects resulting from outsourcing or internal manufacturing processes which may adversely affect our production yields and operating results

 

(5) Factors that may affect our exports, including a strong yen, political and economic instability, difficulties in collection of accounts receivable, decrease in cost competitiveness of our products, increases in shipping and handling costs, difficulty in staffing and managing international operations and inadequate protection of our intellectual property

 

(6) Changes in exchange rates, particularly between the yen and the U.S. dollar and Euro, respectively, in which we make significant sales

 

(7) Exposure to credit risk on trade receivables due to customers’ worsening financial condition

 

(8) Inability to secure skilled employees, particularly engineering and technical personnel

 

(9) Insufficient protection of our trade secrets and patents

 

(10) Our continuing to hold licenses to manufacture and sell certain of our products

 

(11) The possibility that future initiatives and in-process research and development may not produce the desired results

 

(12) The possibility that companies or assets acquired by us may not produce the returns or benefits, or bring in business opportunities, which we expect, and may require more cost than expected for integration or impairment losses on goodwill and intangible assets related to the acquisition

 

(13) Events that may impact negatively on our markets or supply chain, including terrorist acts and outbreaks of disease

 

(14) The occurrence of natural disasters, such as earthquakes, in locations where our manufacturing and other key business facilities are located

 

(15) The possibility of future tightening of environmental laws and regulations in Japan and other countries which may increase our environmental liability and compliance obligations

 

(16) Fluctuations in the value of, and impairment losses on, securities and other assets held by us

 

(17) Changes in accounting principles

Such risks, uncertainties and other factors may cause our actual results, performance, achievements or financial position to be materially different from any future results, performance, achievements or financial position expressed or implied by these forward-looking statements. We undertake no obligation to publicly update any forward-looking statements included in this document.

 

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4. Other Information

Change in accounting principles, procedures and financial statements’ presentation:

Adoption of New Accounting Standards

Kyocera adopted the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 105, “Generally Accepted Accounting Principles” (former Statement of Financial Accounting Standards (SFAS) No. 168, “The FASB Accounting Standards Codification and Hierarchy of Generally Accepted Accounting Principles - a replacement of FASB Statement No. 162”) on July 1, 2009. This accounting standard compiles all generally accepted accounting principles in the U.S. and establishes “Accounting Standards Codification” as the single official source of authoritative generally accepted accounting standards. The adoption of this accounting standard had no impact on Kyocera’s consolidated results of operations, financial position and cash flows.

Kyocera adopted FASB ASC 805, “Business Combinations” (former SFAS No. 141 (revised 2007), “Business Combinations”) on April 1, 2009, which requires assets, liabilities and noncontrolling interests be measured at fair value. Under this accounting standard, transaction and restructuring costs are required to be generally expensed, as well as contingent consideration and in-process research and development be recorded at fair value on acquisition date as a part of fair value of acquired business. Any tax adjustment made after the measurement period impacts income tax expenses. This accounting standard also requires companies to recognize an asset acquired or a liability assumed in a business combination that arises from a contingency at fair value, at the acquisition date, if the acquisition-date fair value of that asset or liability can be determined during the measurement period. The adoption of this accounting standard had no material impact on Kyocera’s consolidated results of operations, financial position and cash flows.

Kyocera adopted FASB ASC 810, “Consolidation” (former SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements - an Amendment of Accounting Research Bulletin No. 51”) on April 1, 2009. This accounting standard requires that a noncontrolling interest in a subsidiary is an ownership interest in the consolidated entity that should be reported as equity in the consolidated financial statements, and requires that changes in a parent’s ownership interest while the parent retains its controlling financial interest in its subsidiary shall be accounted for as equity transactions. Upon the adoption of this accounting standard, noncontrolling interests, which were previously referred to as minority interests and classified between total liabilities and shareholders’ equity on the consolidated balance sheets, are now included as a separate component of total equity. The presentation of consolidated statements of income and cash flows has also been changed. In addition, in accordance with a requirement of this accounting standard, certain reclassification of previously reported amounts have been made to the consolidated balance sheet at March 31, 2009, the consolidated statement of income for the nine months ended December 31, 2008 and the consolidated statement of cash flow for the nine months ended December 31, 2008.

 

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5. Supplemental Information

(1) Capital expenditures, Depreciation, R&D expenses

 

     (Yen in millions)  
     Nine months ended December 31,   Increase
(Decrease)
%
 
     2008    2009  
     Amount    % to net
sales
   Amount    % to net
sales
 

Capital expenditures

   ¥   55,242    6.1    ¥  22,154    2.9   (59.9

Depreciation

   ¥ 61,857    6.9    ¥ 45,029    5.9   (27.2

R&D expenses

   ¥ 51,442    5.7    ¥ 38,098    5.0   (25.9

(2) Alternative Dispute Resolution Procedure at WILLCOM, Inc.

Kyocera owns a 30% interest in WILLCOM, Inc. and accounts for its investment under the equity method. Kyocera mainly sells Personal Handyphone System (PHS) handsets and PHS base stations to WILLCOM, Inc.

On September 24, 2009, WILLCOM, Inc. applied for Alternative Dispute Resolution (ADR) process in order to improve earning capacity and financial strength with the goal of revitalizing and strengthening the business, and received acceptance for the ADR procedure as prescribed in the Act on Special Measures for Industrial Revitalization with Japanese Association of Turnaround Professionals (JATP).

The ADR process is not a bankruptcy process but is a procedure that has the reliability in the form of legal settlement and the flexibility of a private settlement that allows the company to continue its daily commercial transactions. The JATP is an independent organization licensed by the Minister of Economy, Trade and Industry of Japan. The ADR procedure enables users to resolve disputes with the involvement of JATP, which acts as an unbiased intermediary in achieving a resolution between the parties.

At December 31, 2009, the business revitalization plan continues to be under discussion and has not been resolved.

During the three months ended December 31, 2009, Kyocera recognized an impairment loss of ¥19,987 million on its investment in WILLCOM, Inc. in equity in losses of affiliates and unconsolidated subsidiaries as management believes the investment may not be recoverable.

At December 31, 2009, Kyocera’s trade receivables from WILLCOM, Inc. were ¥ 15,350 million. Kyocera’s sales to WILLCOM, Inc. during the nine months ended December 31, 2008 and 2009 were ¥17,476 million and ¥15,407 million, respectively.

At December 31, 2009, Kyocera recorded no allowance against trade receivables from WILLCOM, Inc. Taking into consideration the current financial positions and estimated future cash flows of WILLCOM, Inc., Kyocera believes there are no trade receivables which are expected to be uncollectible taking into account the situation that the business revitalization plan had not been resolved. The result of resolution may affect the valuation of Kyocera’s trade receivables from WILLCOM, Inc. and may have a material effect on Kyocera’s consolidated results of operations and financial position.

 

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6. Consolidated Financial Statements

(1) CONSOLIDATED BALANCE SHEETS (Unaudited)

 

     (Yen in millions)  
     December 31, 2009    March 31, 2009    Increase
(Decrease)
 
     Amount     %    Amount     %   

Current assets:

            

Cash and cash equivalents

   ¥ 298,633         ¥ 269,247         ¥   29,386   

Short-term investments

     171,666           202,143           (30,477

Trade notes receivables

     15,444           13,750           1,694   

Trade accounts receivables

     202,567           158,754           43,813   

Less allowances for doubtful accounts and sales returns

     (3,975        (4,669        694   

Inventories

     181,278           199,641           (18,363

Deferred income taxes

     37,054           35,187           1,867   

Other current assets

     86,178           78,263           7,915   
                                  

Total current assets

     988,845      55.2      952,316      53.7      36,529   
                                  

Non-current assets:

            

Investments and advances:

            

Investments in and advances to affiliates and unconsolidated subsidiaries

     1,373           19,376           (18,003

Securities and other investments

     372,466           351,849           20,617   
                                  

Total investments and advances

     373,839      20.9      371,225      20.9      2,614   

Property, plant and equipment:

            

Land

     57,019           57,077           (58

Buildings

     285,794           288,460           (2,666

Machinery and equipment

     689,606           707,399           (17,793

Construction in progress

     8,656           6,397           2,259   

Less accumulated depreciation

     (800,975        (793,279        (7,696
                                  

Total property, plant and equipment

     240,100      13.4      266,054      15.0      (25,954

Goodwill

     67,523      3.8      63,226      3.6      4,297   

Intangible assets

     52,297      2.9      60,077      3.4      (7,780

Other assets

     68,863      3.8      60,904      3.4      7,959   
                                  

Total non-current assets

     802,622      44.8      821,486      46.3      (18,864
                                  

Total assets

   ¥         1,791,467      100.0    ¥     1,773,802      100.0    ¥ 17,665   
                                  

 

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Table of Contents
     (Yen in millions)  
     December 31, 2009    March 31, 2009    Increase  
     Amount     %    Amount     %    (Decrease)  

Current liabilities:

            

Short-term borrowings

   ¥ 3,972         ¥ 11,000         ¥ (7,028

Current portion of long-term debt

     14,059           13,865           194   

Trade notes and accounts payable

     83,016           62,579           20,437   

Other notes and accounts payable

     47,316           43,452           3,864   

Accrued payroll and bonus

     36,077           41,756           (5,679

Accrued income taxes

     9,645           7,430           2,215   

Other accrued liabilities

     26,856           26,967           (111

Other current liabilities

     37,041           30,912           6,129   
                                  

Total current liabilities

     257,982      14.4      237,961      13.4      20,021   
                                  

Non-current liabilities:

            

Long-term debt

     31,146           28,538           2,608   

Accrued pension and severance liabilities

     32,280           34,567           (2,287

Deferred income taxes

     72,023           71,539           484   

Other non-current liabilities

     16,441           18,109           (1,668
                                  

Total non-current liabilities

     151,890      8.5      152,753      8.6      (863
                                  

Total liabilities

     409,872      22.9      390,714      22.0      19,158   
                                  

Kyocera Corporation shareholders’ equity:

            

Common stock

     115,703           115,703           —     

Additional paid-in capital

     162,973           163,151           (178

Retained earnings

     1,146,508           1,150,050           (3,542

Accumulated other comprehensive income

     (53,387        (54,673        1,286   

Treasury stock, at cost

     (50,603        (50,568        (35
                                  

Total Kyocera Corporation shareholders’ equity

     1,321,194      73.7      1,323,663      74.6      (2,469
                                  

Noncontrolling interests

     60,401      3.4      59,425      3.4      976   
                                  

Total equity

     1,381,595      77.1      1,383,088      78.0      (1,493
                                  

Total liabilities and equity

   ¥ 1,791,467      100.0    ¥ 1,773,802      100.0    ¥ 17,665   
                                  

 

Note: Accumulated other comprehensive income is as follows:

 

            
     (Yen in millions)  
     December 31, 2009          March 31, 2009          Increase
(Decrease)
 

Net unrealized gains on securities

   ¥ 24,502         ¥ 11,621         ¥ 12,881   

Net unrealized losses on derivative financial instruments

   ¥ (99      ¥ (145      ¥ 46   

Pension adjustments

   ¥ (1,204      ¥ 53         ¥ (1,257

Foreign currency translation adjustments

   ¥ (76,586      ¥ (66,202      ¥ (10,384

 

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Table of Contents

(2) CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

 

     (Yen in millions and shares in thousands, except per share amounts)  
     Nine months ended December 31,     Increase  
     2008     2009     (Decrease)  
         Amount                 %                 Amount                 %                 Amount                 %          

Net sales

   ¥ 902,577      100.0      ¥ 768,920      100.0      ¥ (133,657   (14.8

Cost of sales

     652,416      72.3        572,776      74.5        (79,640   (12.2
                                          

Gross profit

     250,161      27.7        196,144      25.5        (54,017   (21.6

Selling, general and administrative expenses

     182,904      20.2        158,131      20.6        (24,773   (13.5
                                          

Profit from operations

     67,257      7.5        38,013      4.9        (29,244   (43.5

Other income (expenses):

            

Interest and dividend income

     13,552      1.5        11,821      1.6        (1,731   (12.8

Interest expense

     (544   (0.1     (2,188   (0.3     (1,644   —     

Foreign currency transaction (losses) gains, net

     (521   (0.1     1,871      0.3        2,392      —     

Equity in earnings (losses) of affiliates and unconsolidated subsidiaries

     4,905      0.5        (18,195   (2.4     (23,100   —     

Losses on sale of securities, net

     (2,245   (0.2     (162   (0.0     2,083      —     

Losses on impairment of securities

     (1,488   (0.2     (114   (0.0     1,374      —     

Other, net

     1,493      0.2        1,693      0.2        200      13.4   
                                          

Total other income (expenses)

     15,152      1.6        (5,274   (0.6     (20,426   —     
                                          

Income before income taxes

     82,409      9.1        32,739      4.3        (49,670   (60.3

Income taxes

     22,045      2.4        10,747      1.4        (11,298   (51.2
                                          

Net income

     60,364      6.7        21,992      2.9        (38,372   (63.6

Net income attributable to noncontrolling interests

     (3,596   (0.4     (3,511   (0.5     85      —     
                                          

Net income attributable to shareholders of Kyocera Corporation

   ¥ 56,768      6.3      ¥ 18,481      2.4      ¥ (38,287   (67.4
                                          

Earnings per share:

            

Net income attributable to shareholders of Kyocera Corporation:

            

Basic

   ¥ 300.39        ¥ 100.70         

Diluted

   ¥ 300.30        ¥ 100.70         

Average number of shares of common stock outstanding:

            

Basic

     188,981          183,526         

Diluted

     189,038          183,526         

Note:

Basic earnings per share attributable to shareholders of Kyocera Corporation was computed based on the average number of shares of common stock outstanding during each period, and diluted earnings per share attributable to shareholders of Kyocera Corporation was computed based on the diluted average number of shares of stock outstanding during each period.

 

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(3) CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

 

     (Yen in millions)  
     Nine months ended December 31,  
     2008     2009  

Cash flows from operating activities:

    

Net income

   ¥ 60,364      ¥ 21,992   

Adjustments to reconcile net income to net cash provided by operating activities:

    

Depreciation and amortization

     72,747        54,077   

Write-down of inventories

     4,465        10,817   

Equity in (earnings) losses of affiliates and unconsolidated subsidiaries

     (4,905     18,195   

Losses on sale of securities, net

     2,245        162   

Losses on impairment of securities

     1,488        114   

Gains on sales of property, plant and equipment, and intangible assets, net

     (10,274     (1,374

(Increase) decrease in receivables

     41,675        (32,417

(Increase) decrease in inventories

     (17,239     5,598   

Increase (decrease) in notes and accounts payable

     (38,426     27,114   

Increase (decrease) in accrued income taxes

     (19,059     23   

Other, net

     (23,380     (35,311
                

Net cash provided by operating activities

     69,701        68,990   
                

Cash flows from investing activities:

    

Payments for purchases of securities

     (49,211     (66,305

Proceeds from sales and maturities of securities

     45,163        42,858   

Acquisitions of businesses, net of cash acquired

     (42,717     (4,231

Payments for purchases of property, plant and equipment, and intangible assets

     (68,286     (24,967

Proceeds from sales of property, plant and equipment, and intangible assets

     12,180        2,899   

Acquisition of certificate deposits and time deposits

     (219,113     (212,625

Withdrawal of certificate deposits and time deposits

     136,758        265,475   

Other, net

     (6,031     515   
                

Net cash used in investing activities

     (191,257     3,619   
                

Cash flows from financing activities:

    

Increase (decrease) in short-term debt

     6,317        (6,577

Issuance of long-term debt

     —          11,642   

Payments of long-term debt

     (3,335     (16,591

Dividends paid

     (24,017     (23,247

Purchase of treasury stock

     (38,195     (38

Reissuance of treasury stock

     3,036        3   

Other, net

     (2,126     (1,893
                

Net cash used in financing activities

     (58,320     (36,701
                

Effect of exchange rate changes on cash and cash equivalents

     (22,702     (6,522
                

Net increase (decrease) in cash and cash equivalents

     (202,578     29,386   

Cash and cash equivalents at beginning of period

     447,586        269,247   
                

Cash and cash equivalents at end of period

   ¥ 245,008      ¥ 298,633   
                

 

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(4) SEGMENT INFORMATION (Unaudited)

1. Reporting segments:

 

     (Yen in millions)  
     Nine months ended December 31,     Increase
(Decrease)
 
     2008     2009    
     Amount     Amount     Amount     %  

Net sales:

        

Fine Ceramic Parts Group

   ¥ 52,122      ¥ 36,387      ¥ (15,735   (30.2

Semiconductor Parts Group

     113,459        99,641        (13,818   (12.2

Applied Ceramic Products Group

     122,431        111,510        (10,921   (8.9

Electronic Device Group

     190,523        145,537        (44,986   (23.6

Telecommunications Equipment Group

     169,785        131,408        (38,377   (22.6

Information Equipment Group

     175,380        170,660        (4,720   (2.7

Others

     96,973        89,753        (7,220   (7.4

Adjustments and eliminations

     (18,096     (15,976     2,120      —     
                              
   ¥ 902,577      ¥ 768,920      ¥ (133,657   (14.8
                              

Operating profit (loss):

        

Fine Ceramic Parts Group

   ¥ 2,492      ¥ (2,567   ¥ (5,059   —     

Semiconductor Parts Group

     11,883        10,447        (1,436   (12.1

Applied Ceramic Products Group

     27,994        10,909        (17,085   (61.0

Electronic Device Group

     5,136        6,515        1,379      26.8   

Telecommunications Equipment Group

     (10,651     (6,426     4,225      —     

Information Equipment Group

     14,594        14,724        130      0.9   

Others

     15,241        3,907        (11,334   (74.4
                              
     66,689        37,509        (29,180   (43.8

Corporate

     10,795        13,425        2,630      24.4   

Equity in earnings (losses) of affiliates and unconsolidated subsidiaries

     4,905        (18,195     (23,100   —     

Adjustments and eliminations

     20        0        (20   (100.0
                              

Income before income taxes

   ¥ 82,409      ¥ 32,739      ¥ (49,670   (60.3
                              

 

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2. Geographic segments (Net sales and income before income taxes by geographic area):

 

     (Yen in millions)  
     Nine months ended December 31,     Increase
(Decrease)
 
     2008     2009    
     Amount     Amount     Amount     %  

Net sales:

        

Japan

   ¥ 390,851      ¥ 339,761      ¥ (51,090   (13.1

Intra-group sales and transfer between geographic areas

     299,508        226,700        (72,808   (24.3
                              
     690,359        566,461        (123,898   (17.9
                              

Europe

     167,158        153,829        (13,329   (8.0

Intra-group sales and transfer between geographic areas

     22,684        19,381        (3,303   (14.6
                              
     189,842        173,210        (16,632   (8.8
                              

United States of America

     197,562        154,048        (43,514   (22.0

Intra-group sales and transfer between geographic areas

     17,899        17,768        (131   (0.7
                              
     215,461        171,816        (43,645   (20.3
                              

Asia

     130,500        107,753        (22,747   (17.4

Intra-group sales and transfer between geographic areas

     162,468        108,817        (53,651   (33.0
                              
     292,968        216,570        (76,398   (26.1
                              

Others

     16,506        13,529        (2,977   (18.0

Intra-group sales and transfer between geographic areas

     10,055        9,410        (645   (6.4
                              
     26,561        22,939        (3,622   (13.6

Adjustments and eliminations

     (512,614     (382,076     130,538      —     
                              
   ¥ 902,577      ¥ 768,920      ¥ (133,657   (14.8
                              

Income before income taxes:

        

Japan

   ¥ 34,647      ¥ 17,424      ¥ (17,223   (49.7

Europe

     5,347        1,968        (3,379   (63.2

United States of America

     817        4,811        3,994      488.9   

Asia

     21,654        9,884        (11,770   (54.4

Others

     567        1,964        1,397      246.4   
                              
     63,032        36,051        (26,981   (42.8

Corporate

     10,795        13,425        2,630      24.4   

Equity in earnings (losses) of affiliates and unconsolidated subsidiaries

     4,905        (18,195     (23,100   —     

Adjustments and eliminations

     3,677        1,458        (2,219   (60.3
                              

Income before income taxes

   ¥ 82,409      ¥ 32,739      ¥ (49,670   (60.3
                              

 

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3. Geographic segments (Net sales by region):

 

     (Yen in millions)  
     Nine months ended December 31,    Increase
(Decrease)
 
     2008    2009   
     Amount     %    Amount     %    Amount     %  

Japan

   ¥ 370,829      41.1    ¥ 330,167      42.9    ¥ (40,662   (11.0

Europe

     161,074      17.8      147,068      19.1      (14,006   (8.7

United States of America

     162,057      18.0      128,159      16.7      (33,898   (20.9

Asia

     152,202      16.9      126,670      16.5      (25,532   (16.8

Others

     56,415      6.2      36,856      4.8      (19,559   (34.7
                                        

Net sales

   ¥ 902,577      100.0    ¥ 768,920      100.0    ¥ (133,657   (14.8
                                        

Net sales outside Japan

   ¥ 531,748         ¥ 438,753         ¥ (92,995   (17.5

Net sales outside Japan to total net sales

     58.9        57.1       

(5) CAUTIONARY STATEMENT FOR PREMISE OF A GOING CONCERN

Not applicable.

(6) CAUTIONARY STATEMENT FOR SIGNIFICANT CHANGES IN EQUITY

Not applicable.

 

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January 28, 2010

Revision of Financial Forecast

for the Fiscal Year Ending March 31, 2010

 

Name of Company Listed:    Kyocera Corporation
Name of Representative:    Tetsuo Kuba, President and Representative Director
   (Code number: 6971, The First Section of the Tokyo Stock Exchange, The First Section of the Osaka Securities Exchange)
Person for inquiry:   

Shoichi Aoki

Director, Managing Executive Officer and General Manager of Corporate Financial & Accounting Group

(Tel: +81-75-604-3500)

This is to advise you that the financial forecast for the fiscal year ending March 31, 2010 (“fiscal 2010”), which was published on October 30, 2009, is revised as set forth below, taking into consideration the recent performance of the Company:

1. Revision of consolidated financial forecast for fiscal 2010

(April 1, 2009 to March 31, 2010)

 

     (Yen in millions)
     Net sales    Profit from
operations
   Income
before
income
taxes
   Net income
attributable
to
shareholders
of Kyocera
Corporation

Forecast previously published (A) (Published on October 30, 2009)

   1,040,000    44,000    57,000    34,000

Revision made (B)

   1,050,000    62,000    57,000    34,000

Amount of increase or decrease (B - A)

   10,000    18,000    —      —  

Ratio of increase or decrease (%)

   1.0    40.9    —      —  

(c.f.) Results for previous fiscal year (Annual Period ended March 31, 2009)

   1,128,586    43,419    55,982    29,506

 

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Table of Contents

2. Reason for Revision

In the nine months ended December 31, 2009 (the “nine months”), demand for components has been on a steady recovery track on the whole. In addition, demand for the solar energy related products expanded particularly in Japan. Accordingly, sales on the whole were solid for the nine months. In terms of profit, Kyocera was able to achieve an improvement in profitability disproportionate to the recovery in sales as a result of efforts throughout the Kyocera Group from the start of fiscal year ending March 31, 2010 (“fiscal 2010”), to comprehensively reduce costs and improve productivity, as well as a recovery in demand for components.

In the three months ending March 31, 2010, Kyocera expects to expand businesses in the information and communication market and the environment and energy market despite uncertainty in the global economy, exchange rate trends and other factors.

On September 24, 2009, WILLCOM, Inc., which is Kyocera’s affiliate accounted for by the equity method and operates a Personal Handyphone System business, applied for Alternative Dispute Resolution (ADR) process, and received acceptance for the ADR procedure. At December 31, 2009, the business revitalization plan continues to be under discussion and has not been resolved. The result of resolution may affect the valuation of Kyocera’s trade receivables from WILLCOM, Inc. and may have a material effect on Kyocera’s consolidated results of operations and financial position, which has not yet been reflected in the consolidated financial forecast set forth above. At December 31, 2009, Kyocera’s trade receivables from WILLCOM, Inc. were ¥ 15,350 million.

 

2

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