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Kyocera 6-K 2015

Documents found in this filing:

  1. 6-K
  2. Graphic
  3. Graphic

 

 

 

 

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 under

the Securities Exchange Act of 1934

 

For the month of January 2015

 

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  o

 

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):   o

 

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):   o

 

 

 

 



 

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 and Accounting Group

 

Date: January 29, 2015

 



 

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, 2014

 



 

 

Consolidated Financial Results of Kyocera Corporation and its Subsidiaries

for the Nine Months Ended December 31, 2014

 

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

 

1. Consolidated Financial Results for the Nine Months Ended December 31, 2014

 

(1) Consolidated results of operations

 

(% of change from previous period)

 

 

Net sales

 

Profit from operations

 

Income before income taxes

 

Net income attributable to
shareholders of

Kyocera Corporation

 

 

 

Million yen

 

%

 

Million yen

 

%

 

Million yen

 

%

 

Million yen

 

%

 

Nine Months ended December 31, 2014

 

1,101,692

 

2.8

 

90,222

 

0.6

 

114,667

 

3.9

 

73,971

 

6.6

 

Nine Months ended December 31, 2013

 

1,071,388

 

15.6

 

89,696

 

75.1

 

110,344

 

60.2

 

69,364

 

54.2

 

 

(Note)  Comprehensive income:

284,368 million yen for the nine months ended December 31, 2014, (13.1)% of change from previous period

327,357 million yen for the nine months ended December 31, 2013, 242.6% of change from previous period

 

 

 

Net income
attributable to
shareholders of

Kyocera Corporation
per share - Basic

 

Net income
attributable to
shareholders of

Kyocera Corporation
per share - Diluted

 

 

 

Yen

 

Yen

 

Nine Months ended December 31, 2014

 

201.63

 

201.63

 

Nine Months ended December 31, 2013

 

189.07

 

189.07

 

 

Kyocera Corporation undertook a stock split at the ratio of two-for-one of all common stock on October 1, 2013. “Net income attributable to shareholders of Kyocera Corporation per share - Basic” and “Net income attributable to shareholders of Kyocera Corporation per share - Diluted” during the nine months ended December 31, 2013 are calculated under the assumption that the stock split had been undertaken at the beginning of the year ended March 31, 2014 in accordance with the standard related to earnings per share.

 

(2) Consolidated financial condition

 

 

 

Total assets

 

Total equity

 

Kyocera Corporation
shareholders’ equity

 

Kyocera Corporation
shareholders’ equity
to total assets

 

 

 

Million yen

 

Million yen

 

Million yen

 

%

 

December 31, 2014

 

2,971,953

 

2,236,997

 

2,149,884

 

72.4

 

March 31, 2014

 

2,636,704

 

1,987,226

 

1,910,083

 

72.5

 

 

2. Dividends

 

 

 

Dividends per share

 

 

 

End of
first quarter

 

End of
second quarter

 

End of
third quarter

 

Year-end

 

Annual

 

 

 

Yen

 

Yen

 

Yen

 

Yen

 

Yen

 

Year ended March 31, 2014

 

 

80.00

 

 

40.00

 

 

Year ending March 31, 2015

 

 

40.00

 

 

40.00

 

80.00

 

 

(Note) “End of second quarter” dividend per share of 80.00 yen for the year ended March 31, 2014 was calculated based on the number of shares before the stock split undertaken on October 1, 2013.

 

1



 

3. Consolidated Financial Forecasts for the Year Ending March 31, 2015

 

(% of change from previous year)

 

 

Net sales

 

Profit from
operations

 

Income before
income taxes

 

Net income
attributable to
shareholders of

Kyocera Corporation

 

Net income
attributable to
shareholders of

Kyocera Corporation
per share

 

 

 

Million yen

 

%

 

Million yen

 

%

 

Million yen

 

%

 

Million yen

 

%

 

Yen

 

Year ending March 31, 2015

 

1,530,000

 

5.7

 

135,000

 

12.0

 

158,000

 

8.0

 

97,000

 

9.3

 

264.40

 

 

(Note) Forecast of earnings per share attributable to shareholders of Kyocera Corporation is calculated based on the diluted average number of shares outstanding during the nine months ended December 31, 2014.

 

(Notes)

 

(1) Increase or decrease in significant subsidiaries during the nine months ended December 31, 2014: None

 

(2) Adoption of concise quarterly accounting method or procedure: None

 

(3) Changes in accounting policies:

 

(i)    Changes due to adoption of new accounting standards: Please refer to the accompanying “3. OTHER INFORMATION” on page 15.

 

(ii)         Changes due to other than adoption of new accounting standards: None

 

(4) Number of shares (common stock):

 

(i)   Number of shares issued:

 

377,618,580 shares at December 31, 2014

377,618,580 shares at March 31, 2014

 

(ii)  Number of treasury stock:

 

10,755,768 shares at December 31, 2014

10,751,865 shares at March 31, 2014

 

(iii) Average number of shares outstanding:

 

366,864,937 shares for the nine months ended December 31, 2014

366,873,131 shares for the nine months ended
December 31, 2013

 

“Average number of shares outstanding” for the nine months ended December 31, 2013 are calculated under the assumption that the stock split undertaken on October 1, 2013 had been undertaken at the beginning of the year ended March 31, 2014.

 

Presentation of Situation of Review Procedure

 

The consolidated financial information included in this report is out of scope of the review procedure under the Financial Instruments and Exchange Law of Japan. The review procedure under the Financial Instruments and Exchange Law of Japan has not been completed at the date of disclosure of this report.

 

Instruction for Forecasts and Other Notes

 

Cautionary Statement for Forecasts:

 

With regard to forecasts set forth above, please refer to the accompanying “Forward-Looking Statements” on page 10.

 

2



 

Accompanying Information

 

1. BUSINESS RESULTS, FINANCIAL CONDITION AND PROSPECTS

 

(1) Business Results for the Nine Months Ended December 31, 2014

 

Economic Situation and Business Environment

 

During the nine months ended December 31, 2014 (“the nine months”), the Japanese economy posted sluggish growth compared with the nine months ended December 31, 2013 (“the previous nine months”) due to slow personal consumption as a result of the increase in the consumption tax rate and slowed private capital investment, despite an increase in public investment. Overseas, the U.S. economy expanded on the back of solid growth in personal consumption and capital investment. The Chinese economy slowed, although it continued to post a high growth ratio. The European economy, however, stagnated due mainly to slumping domestic demand including capital investment.

 

With regard to the principal markets for Kyocera Corporation and its consolidated subsidiaries (“Kyocera Group” or “Kyocera”), demand for smartphones grew in the digital consumer equipment market, and sales increased steadily in the automotive market, mainly in China and the United States. Growth in the solar energy market in Japan, however, slowed considerably due mainly to the change in the government subsidy policies including the end of supporting introduction of solar power generation systems for residential use and the impact of a halt in grid access applications by electric power companies.

 

Consolidated Financial Results

 

Consolidated net sales for the nine months amounted to a record high of ¥1,101,692 million, an increase of ¥30,304 million, or 2.8%, compared with ¥1,071,388 million for the previous nine months due to increased sales in the Information Equipment Group, the Semiconductor Parts Group and the Fine Ceramic Parts Group.

 

Profit in the Applied Ceramic Products Group and the Telecommunications Equipment Group for the nine months decreased compared with the previous nine months, while profit in the Information Equipment Group, the Fine Ceramic Parts Group and the Electronic Device Group increased due to sales growth and cost reductions. As a result, profit from operations for the nine months increased by ¥526 million, or 0.6%, to ¥90,222 million, compared with ¥89,696 million for the previous nine months. Income before income taxes increased by ¥4,323 million, or 3.9%, to ¥114,667 million, compared with ¥110,344 million for the previous nine months due to an increase in dividend income in addition to an increase in profit from operations. Net income attributable to shareholders of Kyocera Corporation in the nine months increased by ¥4,607 million, or 6.6%, to ¥73,971 million, compared with ¥69,364 million for the previous nine months due in part to decreased income taxes resulting from a revision of the tax system in Japan.

 

Average exchange rates for the nine months were ¥107 to the U.S. dollar, marking depreciation of ¥8 (approximately 8%) from ¥99 for the previous nine months, and ¥140 to the Euro, marking depreciation of ¥8 (approximately 6%) from ¥132 for the previous nine months.

 

 

 

Nine months ended December 31,

 

Increase

 

 

 

2013

 

2014

 

(Decrease)

 

 

 

Amount

 

%

 

Amount

 

%

 

Amount

 

%

 

 

 

(Yen in millions, except exchange rates)

 

Net sales

 

¥1,071,388

 

100.0

 

¥1,101,692

 

100.0

 

¥30,304

 

2.8

 

Profit from operations

 

89,696

 

8.4

 

90,222

 

8.2

 

526

 

0.6

 

Income before income taxes

 

110,344

 

10.3

 

114,667

 

10.4

 

4,323

 

3.9

 

Net income attributable to shareholders of Kyocera Corporation

 

69,364

 

6.5

 

73,971

 

6.7

 

4,607

 

6.6

 

Average US$ exchange rate

 

99

 

 

107

 

 

 

 

Average Euro exchange rate

 

132

 

 

140

 

 

 

 

 

3



 

Consolidated Results by Reporting Segment

 

1) Fine Ceramic Parts Group

 

Sales and operating profit in this reporting segment increased significantly compared with the previous nine months due to an increase in sales of components for industrial machinery including semiconductor fabrication equipment and of sapphire substrates for LEDs as well as automotive components such as camera modules.

 

2) Semiconductor Parts Group

 

Sales in this reporting segment increased compared with the previous nine months due to an increase in sales of ceramic packages mainly for smartphones, communications infrastructures and LEDs in addition to full contribution from a consolidated subsidiary that joined the Kyocera Group in October 2013. Operating profit decreased compared with the previous nine months, however, due mainly to a decline in sales of organic packages for servers.

 

3) Applied Ceramic Products Group

 

The cutting tool business was solid due primarily to an increase in production in automotive related markets. In the solar energy business, sales decreased compared with the previous nine months despite efforts to expand product lineup and reduce costs. This was due mainly to a decline in prices and the impact of a halt in grid access applications by electric power companies. As a result, sales and operating profit in this reporting segment decreased compared with the previous nine months.

 

4) Electronic Device Group

 

Sales in this reporting segment slightly decreased compared with the previous nine months due to the impact of structural reforms implemented in the previous fiscal year to downsize certain operations, despite steady growth in sales of components including capacitors for smartphones. Operating profit, however, increased considerably compared with the previous nine months due mainly to a reduction in costs, as well as the effect of the aforementioned structural reforms.

 

5) Telecommunications Equipment Group

 

Sales in the overseas business increased on account of proactive launch of new mobile phones, as well as development of new customers. Sales and operating profit in this reporting segment, however, decreased compared with the previous nine months due mainly to a decline in demand in the Japanese market.

 

6) Information Equipment Group

 

Sales in this reporting segment increased compared with the previous nine months due to an increase in sales volume of multifunctional products mainly outside Japan, as a result of active efforts to expand sales of new products. Operating profit increased significantly compared with the previous nine months due to an increase in sales of consumables along with growing sales of machines and to a reduction in costs.

 

7) Others

 

Sales in this reporting segment remained almost unchanged from the previous nine months despite a decline in revenues mainly from the engineering business for communications base stations at Kyocera Communications Systems Co., Ltd., owing to growth in sales in the other subsidiaries. On the other hand, operating profit increased compared with the previous nine months due mainly to the effect of cost reductions.

 

4



 

Net Sales by Reporting Segment

 

 

 

Nine months ended December 31,

 

Increase

 

 

 

2013

 

2014

 

(Decrease)

 

 

 

Amount

 

%

 

Amount

 

%

 

Amount

 

%

 

 

 

(Yen in millions)

 

Fine Ceramic Parts Group

 

¥

58,929

 

5.5

 

¥

66,128

 

6.0

 

¥

7,199

 

12.2

 

Semiconductor Parts Group

 

139,522

 

13.0

 

159,561

 

14.5

 

20,039

 

14.4

 

Applied Ceramic Products Group

 

195,854

 

18.3

 

189,333

 

17.2

 

(6,521

)

(3.3

)

Electronic Device Group

 

216,295

 

20.2

 

213,050

 

19.3

 

(3,245

)

(1.5

)

Total Components Business

 

610,600

 

57.0

 

628,072

 

57.0

 

17,472

 

2.9

 

Telecommunications Equipment Group

 

147,778

 

13.8

 

146,346

 

13.3

 

(1,432

)

(1.0

)

Information Equipment Group

 

221,550

 

20.7

 

241,744

 

21.9

 

20,194

 

9.1

 

Total Equipment Business

 

369,328

 

34.5

 

388,090

 

35.2

 

18,762

 

5.1

 

Others

 

123,177

 

11.5

 

123,176

 

11.2

 

(1

)

(0.0

)

Adjustments and eliminations

 

(31,717

)

(3.0

)

(37,646

)

(3.4

)

(5,929

)

 

Net sales

 

¥

1,071,388

 

100.0

 

¥

1,101,692

 

100.0

 

¥

30,304

 

2.8

 

 

Operating Profit (Loss) by Reporting Segment

 

 

 

Nine months ended December 31,

 

Increase

 

 

 

2013

 

2014

 

(Decrease)

 

 

 

Amount

 

%*

 

Amount

 

%*

 

Amount

 

%

 

 

 

(Yen in millions)

 

Fine Ceramic Parts Group

 

¥

8,484

 

14.4

 

¥

11,167

 

16.9

 

¥

2,683

 

31.6

 

Semiconductor Parts Group

 

24,956

 

17.9

 

24,617

 

15.4

 

(339

)

(1.4

)

Applied Ceramic Products Group

 

22,816

 

11.6

 

9,570

 

5.1

 

(13,246

)

(58.1

)

Electronic Device Group

 

21,240

 

9.8

 

28,281

 

13.3

 

7,041

 

33.1

 

Total Components Business

 

77,496

 

12.7

 

73,635

 

11.7

 

(3,861

)

(5.0

)

Telecommunications Equipment Group

 

1,870

 

1.3

 

(3,223

)

 

(5,093

)

 

Information Equipment Group

 

17,112

 

7.7

 

25,432

 

10.5

 

8,320

 

48.6

 

Total Equipment Business

 

18,982

 

5.1

 

22,209

 

5.7

 

3,227

 

17.0

 

Others

 

3,479

 

2.8

 

4,095

 

3.3

 

616

 

17.7

 

Operating profit

 

99,957

 

9.3

 

99,939

 

9.1

 

(18

)

(0.0

)

Corporate gains and equity in earnings of affiliates and

 

 

 

 

 

 

 

 

 

 

 

 

 

an unconsolidated subsidiary

 

10,861

 

 

15,233

 

 

4,372

 

40.3

 

Adjustments and eliminations

 

(474

)

 

(505

)

 

(31

)

 

Income before income taxes

 

¥

110,344

 

10.3

 

¥

114,667

 

10.4

 

¥

4,323

 

3.9

 

* % to net sales of each corresponding segment

 

5



 

Net Sales by Geographic Area

 

1) Japan

Sales in Japan decreased compared with the previous nine months due to a decline in sales in the solar energy business and the Telecommunications Equipment Group, despite an increase in sales in the Semiconductor Parts Group.

 

2) Asia

Sales in Asia increased compared with the previous nine months due mainly to an increase in sales of components for smartphones in the Semiconductor Parts Group and the Electronic Device Group.

 

3) Europe

Sales in Europe increased compared with the previous nine months due mainly to growing sales of multifunctional products in the Information Equipment Group and to sales growth of the Electronic Device Group.

 

4) United States of America

Sales in the United States of America increased compared with the previous nine months due mainly to increased sales in the Information Equipment Group and the Telecommunications Equipment Group.

 

5) Others

Sales in Others increased compared with the previous nine months due to an increase in sales in the Information Equipment Group.

 

 

 

Nine months ended December 31,

 

Increase

 

 

 

2013

 

2014

 

(Decrease)

 

 

 

Amount

 

%

 

Amount

 

%

 

Amount

 

%

 

 

 

(Yen in millions)

 

Japan

 

¥

469,199

 

43.8

 

¥

447,300

 

40.6

 

¥

(21,899

)

(4.7

)

Asia

 

208,472

 

19.4

 

224,090

 

20.3

 

15,618

 

7.5

 

Europe

 

177,477

 

16.6

 

195,994

 

17.8

 

18,517

 

10.4

 

United States of America

 

167,916

 

15.7

 

182,466

 

16.6

 

14,550

 

8.7

 

Others

 

48,324

 

4.5

 

51,842

 

4.7

 

3,518

 

7.3

 

Net sales

 

¥

1,071,388

 

100.0

 

¥

1,101,692

 

100.0

 

¥

30,304

 

2.8

 

 

6



 

(2) Consolidated Financial Condition

 

Consolidated Cash Flows

 

Cash and cash equivalents at December 31, 2014 decreased by ¥16,250 million to ¥318,924 million from ¥335,174 million at March 31, 2014.

 

1) Cash flows from operating activities

Net cash provided by operating activities for the nine months decreased by ¥26,226 million to ¥70,395 million from ¥96,621 million for the previous nine months. This was due mainly to a decrease of cash inflow adjustment related to receivables, and an increase of cash outflow adjustment related to inventories, despite increases of cash inflow adjustments related to accrued expenses and derivative liabilities.

 

2) Cash flows from investing activities

Net cash used in investing activities for the nine months decreased by ¥3,633 million to ¥73,070 million from ¥76,703 million for the previous nine months. This was due mainly to an increase in proceeds from maturities of held-to-maturity securities, and decreases in acquisition of time deposits and in payments for acquisitions of businesses, which were partly offset by an increase in purchases of held-to-maturity securities and a decrease in withdrawal of time deposits.

 

3) Cash flows from financing activities

Net cash used in financing activities for the nine months increased by ¥5,506 million to ¥36,779 million from ¥31,273 million for the previous nine months. This was due mainly to increases in dividends paid and in purchases of noncontrolling interests.

 

 

 

Nine months ended December 31,

 

 

 

2013

 

2014

 

 

 

(Yen in millions)

 

Cash flows from operating activities

 

¥

96,621

 

¥

70,395

 

Cash flows from investing activities

 

(76,703

)

(73,070

)

Cash flows from financing activities

 

(31,273

)

(36,779

)

Effect of exchange rate changes on cash and cash equivalents

 

18,358

 

23,204

 

Net increase (decrease) in cash and cash equivalents

 

7,003

 

(16,250

)

Cash and cash equivalents at beginning of period

 

305,454

 

335,174

 

Cash and cash equivalents at end of period

 

¥

312,457

 

¥

318,924

 

 

7



 

(3) Consolidated Financial Forecasts for the Year Ending March 31, 2015

 

In the three months ending March 31, 2015 (“the fourth quarter”), Kyocera expects component demand in the industrial machinery market and automotive related markets to remain strong. In addition, Kyocera forecasts an increase in sales volume in the Equipment Business due to the aggressive launch of new products such as mobile phones and multifunctional products and to market cultivation. Conversely, sales in solar energy related business are projected to fall below forecasts made in October 2014 due primarily to the impact of stagnant demand as utility companies halted grid access applications.

 

In light of these circumstances, Kyocera has revised its consolidated sales forecasts for the year ending March 31, 2015 as set forth below. In addition, forecasts for reporting segments have also been revised as set forth on the following page based on conditions for sales and income before income taxes in each reporting segment.

 

Kyocera has also revised its forecasts of average exchange rates for the fourth quarter from the projections made in October 2014, from ¥105 to ¥115 against the U.S. dollar and from ¥135 to ¥130 against the Euro. As a result, full-year forecasts of average exchange rates for the year ending March 31, 2015 have been revised to ¥109 to the U.S. dollar and ¥138 to the Euro.

 

Kyocera aims to achieve full-year financial forecasts by continuing to leverage the collective capabilities of the Kyocera Group to secure orders in existing businesses and create new businesses as well as comprehensively reduce costs.

 

 

 

Results for

 

Forecasts for
the year ending

March 31, 2015 announced on

 

Increase

 

 

 

the year ended
March 31, 2014

 

October 30, 2014
(Previous)

 

January 29, 2015
(Revised)

 

(Decrease)
to Results

 

 

 

Amount

 

%

 

Amount

 

%

 

Amount

 

%

 

%

 

 

 

(Yen in millions, except exchange rates)

 

Net sales

 

¥

1,447,369

 

100.0

 

¥

1,580,000

 

100.0

 

¥

1,530,000

 

100.0

 

5.7

 

Profit from operations

 

120,582

 

8.3

 

135,000

 

8.5

 

135,000

 

8.8

 

12.0

 

Income before income taxes

 

146,268

 

10.1

 

158,000

 

10.0

 

158,000

 

10.3

 

8.0

 

Net income attributable to shareholders of Kyocera Corporation

 

88,756

 

6.1

 

97,000

 

6.1

 

97,000

 

6.3

 

9.3

 

Average US$ exchange rate

 

100

 

 

104

 

 

109

 

 

 

Average Euro exchange rate

 

134

 

 

137

 

 

138

 

 

 

 

8



 

Net Sales by Reporting Segment

 

 

 

Results for

 

Forecasts for the year ending
March 31, 2015 announced on

 

Increase

 

 

 

the year ended
March 31, 2014

 

October 30, 2014
(Previous)

 

January 29, 2015
(Revised)

 

(Decrease)
to Results

 

 

 

Amount

 

%

 

Amount

 

%

 

Amount

 

%

 

%

 

 

 

(Yen in millions)

 

Fine Ceramic Parts Group

 

¥

80,020

 

5.5

 

¥

91,000

 

5.7

 

¥

91,000

 

6.0

 

13.7

 

Semiconductor Parts Group

 

187,891

 

13.0

 

224,000

 

14.2

 

224,000

 

14.6

 

19.2

 

Applied Ceramic Products Group

 

272,795

 

18.9

 

303,000

 

19.2

 

273,000

 

17.9

 

0.1

 

Electronic Device Group

 

284,322

 

19.6

 

291,000

 

18.4

 

291,000

 

19.0

 

2.3

 

Total Components Business

 

825,028

 

57.0

 

909,000

 

57.5

 

879,000

 

57.5

 

6.5

 

Telecommunications Equipment Group

 

186,749

 

12.9

 

205,000

 

13.0

 

205,000

 

13.4

 

9.8

 

Information Equipment Group

 

307,848

 

21.3

 

335,000

 

21.2

 

335,000

 

21.9

 

8.8

 

Total Equipment Business

 

494,597

 

34.2

 

540,000

 

34.2

 

540,000

 

35.3

 

9.2

 

Others

 

173,137

 

11.9

 

178,000

 

11.3

 

170,000

 

11.1

 

(1.8

)

Adjustments and eliminations

 

(45,393

)

(3.1

)

(47,000

)

(3.0

)

(59,000

)

(3.9

)

 

Net sales

 

¥

1,447,369

 

100.0

 

¥

1,580,000

 

100.0

 

¥

1,530,000

 

100.0

 

5.7

 

 

Operating Profit by Reporting Segment

 

 

 

Results for

 

Forecasts for the year ending
March 31, 2015 announced on

 

Increase

 

 

 

the year ended
March 31, 2014

 

October 30, 2014
(Previous)

 

January 29, 2015
(Revised)

 

(Decrease)
to Results

 

 

 

Amount

 

%*

 

Amount

 

%*

 

Amount

 

%*

 

%

 

 

 

(Yen in millions)

 

Fine Ceramic Parts Group

 

¥

11,836

 

14.8

 

¥

15,000

 

16.5

 

¥

15,000

 

16.5

 

26.7

 

Semiconductor Parts Group

 

31,889

 

17.0

 

33,600

 

15.0

 

33,600

 

15.0

 

5.4

 

Applied Ceramic Products Group

 

33,501

 

12.3

 

15,000

 

5.0

 

10,000

 

3.7

 

(70.2

)

Electronic Device Group

 

21,160

 

7.4

 

35,900

 

12.3

 

35,900

 

12.3

 

69.7

 

Total Components Business

 

98,386

 

11.9

 

99,500

 

10.9

 

94,500

 

10.8

 

(3.9

)

Telecommunications Equipment Group

 

1,437

 

0.8

 

8,300

 

4.0

 

5,000

 

2.4

 

247.9

 

Information Equipment Group

 

28,193

 

9.2

 

33,500

 

10.0

 

33,500

 

10.0

 

18.8

 

Total Equipment Business

 

29,630

 

6.0

 

41,800

 

7.7

 

38,500

 

7.1

 

29.9

 

Others

 

6,276

 

3.6

 

6,400

 

3.6

 

5,400

 

3.2

 

(14.0

)

Operating profit

 

134,292

 

9.3

 

147,700

 

9.3

 

138,400

 

9.0

 

3.1

 

Corporate and others

 

11,976

 

 

10,300

 

 

19,600

 

 

63.7

 

Income before income taxes

 

¥

146,268

 

10.1

 

¥

158,000

 

10.0

 

¥

158,000

 

10.3

 

8.0

 

* % to net sales of each corresponding segment

 

9



 

Note: 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:

 

(1)

Decline in demand for our products due to sluggish economic conditions in Japan and worldwide;

 

 

(2)

Economic, political and legal conditions and unexpected changes therein in countries or areas where we operate;

 

 

(3)

Factors that may affect our exports, including the yen’s appreciation, political and economic instability, customs, and inadequate protection of our intellectual property;

 

 

(4)

Fluctuation in exchange rates that may affect the value of our foreign assets or our business activities;

 

 

(5)

Intensified competition in product pricing, technological innovation, R&D activities, product quality and speed of delivery;

 

 

(6)

Manufacturing delays or defects resulting from outsourcing or internal manufacturing processes;

 

 

(7)

Shortages and rising costs of electricity affecting our production and sales activities;

 

 

(8)

The possibility that expansion of production capacity and in-process R&D activities may not produce the desired results;

 

 

(9)

The possibility that companies or assets acquired by us may not produce the returns or benefits, or bring in business opportunities, which we expect;

 

 

(10)

Inability to secure skilled employees, particularly engineering and technical personnel;

 

 

(11)

The possibility of divulgence of our trade secrets and infringement of our intellectual property rights;

 

 

(12)

The possibility that we may receive notice of claims of infringement of other parties’ intellectual property rights and claims for royalty payments;

 

 

(13)

Increases in our environmental liability and in costs and expenses required to observe obligations imposed by environmental laws and regulations in Japan and other countries;

 

 

(14)

Unintentional conflict with laws and regulations, or the possibility that amendments to laws and regulations or newly enacted laws and regulations may limit our business operations;

 

 

(15)

Events that may negatively impact our markets or supply chain, including plague, terrorist acts, international disputes and conflicts, etc. and similar events;

 

 

(16)

Earthquakes and other related natural disasters affecting our operational facilities and our markets or supply chain, as well as social and economic infrastructure;

 

 

(17)

Exposure to difficulties in collection of trade receivables due to customers’ worsening financial condition;

 

 

(18)

The possibility of recognition of impairment losses on investment securities held by us due to declines in their value;

 

 

(19)

The possibility that we may record impairment losses on long-lived assets, goodwill and intangible assets;

 

 

(20)

The possibility that deferred tax assets may not be realized or additional liabilities for unrecognized tax benefits may be incurred; and

 

 

(21)

Changes in accounting principles.

 

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

 

10



 

2. CONSOLIDATED FINANCIAL STATEMENTS

 

(1) Consolidated Balance Sheets (Unaudited)

 

 

 

March 31, 2014

 

December 31, 2014

 

Increase

 

 

 

Amount

 

%

 

Amount

 

%

 

(Decrease)

 

 

 

(Yen in millions)

 

Current assets:

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

¥

335,174

 

 

 

¥

318,924

 

 

 

¥

(16,250

)

Short-term investments in debt and equity securities

 

115,900

 

 

 

136,777

 

 

 

20,877

 

Other short-term investments

 

160,331

 

 

 

128,847

 

 

 

(31,484

)

Trade notes receivables

 

22,054

 

 

 

22,371

 

 

 

317

 

Trade accounts receivables

 

257,850

 

 

 

282,994

 

 

 

25,144

 

Less allowances for doubtful accounts and sales returns

 

(5,062

)

 

 

(5,778

)

 

 

(716

)

Inventories

 

335,802

 

 

 

392,308

 

 

 

56,506

 

Deferred income taxes

 

41,499

 

 

 

41,029

 

 

 

(470

)

Other current assets

 

103,887

 

 

 

115,911

 

 

 

12,024

 

Total current assets

 

1,367,435

 

51.9

 

1,433,383

 

48.2

 

65,948

 

Non-current assets:

 

 

 

 

 

 

 

 

 

 

 

Investments and advances:

 

 

 

 

 

 

 

 

 

 

 

Long-term investments in debt and equity securities

 

738,212

 

 

 

997,472

 

 

 

259,260

 

Other long-term investments

 

14,847

 

 

 

16,543

 

 

 

1,696

 

Total investments and advances

 

753,059

 

28.6

 

1,014,015

 

34.1

 

260,956

 

Property, plant and equipment:

 

 

 

 

 

 

 

 

 

 

 

Land

 

63,268

 

 

 

63,609

 

 

 

341

 

Buildings

 

344,167

 

 

 

357,869

 

 

 

13,702

 

Machinery and equipment

 

826,881

 

 

 

857,543

 

 

 

30,662

 

Construction in progress

 

11,821

 

 

 

12,126

 

 

 

305

 

Less accumulated depreciation

 

(975,580

)

 

 

(1,016,429

)

 

 

(40,849

)

Total property, plant and equipment

 

270,557

 

10.3

 

274,718

 

9.2

 

4,161

 

Goodwill

 

116,632

 

4.4

 

124,630

 

4.2

 

7,998

 

Intangible assets

 

59,326

 

2.2

 

60,961

 

2.1

 

1,635

 

Other assets

 

69,695

 

2.6

 

64,246

 

2.2

 

(5,449

)

Total non-current assets

 

1,269,269

 

48.1

 

1,538,570

 

51.8

 

269,301

 

Total assets

 

¥

2,636,704

 

100.0

 

¥

2,971,953

 

100.0

 

¥

335,249

 

 

11



 

 

 

March 31, 2014

 

December 31, 2014

 

Increase

 

 

 

Amount

 

%

 

Amount

 

%

 

(Decrease)

 

 

 

(Yen in millions)

 

Current liabilities:

 

 

 

 

 

 

 

 

 

 

 

Short-term borrowings

 

¥

4,064

 

 

 

¥

5,302

 

 

 

¥

1,238

 

Current portion of long-term debt

 

12,360

 

 

 

10,511

 

 

 

(1,849

)

Trade notes and accounts payable

 

122,424

 

 

 

122,731

 

 

 

307

 

Other notes and accounts payable

 

48,224

 

 

 

54,999

 

 

 

6,775

 

Accrued payroll and bonus

 

56,068

 

 

 

48,181

 

 

 

(7,887

)

Accrued income taxes

 

23,353

 

 

 

13,873

 

 

 

(9,480

)

Other accrued liabilities

 

31,347

 

 

 

55,699

 

 

 

24,352

 

Other current liabilities

 

29,611

 

 

 

44,392

 

 

 

14,781

 

Total current liabilities

 

327,451

 

12.4

 

355,688

 

12.0

 

28,237

 

Non-current liabilities:

 

 

 

 

 

 

 

 

 

 

 

Long-term debt

 

19,466

 

 

 

19,774

 

 

 

308

 

Accrued pension and severance liabilities

 

36,812

 

 

 

29,763

 

 

 

(7,049

)

Deferred income taxes

 

235,954

 

 

 

311,092

 

 

 

75,138

 

Other non-current liabilities

 

29,795

 

 

 

18,639

 

 

 

(11,156

)

Total non-current liabilities

 

322,027

 

12.2

 

379,268

 

12.7

 

57,241

 

Total liabilities

 

649,478

 

24.6

 

734,956

 

24.7

 

85,478

 

Kyocera Corporation shareholders’ equity:

 

 

 

 

 

 

 

 

 

 

 

Common stock

 

115,703

 

 

 

115,703

 

 

 

 

Additional paid-in capital

 

162,666

 

 

 

162,695

 

 

 

29

 

Retained earnings

 

1,415,784

 

 

 

1,460,406

 

 

 

44,622

 

Accumulated other comprehensive income

 

250,963

 

 

 

446,133

 

 

 

195,170

 

Common stock in treasury, at cost

 

(35,033

)

 

 

(35,053

)

 

 

(20

)

Total Kyocera Corporation shareholders’ equity

 

1,910,083

 

72.5

 

2,149,884

 

72.4

 

239,801

 

Noncontrolling interests

 

77,143

 

2.9

 

87,113

 

2.9

 

9,970

 

Total equity

 

1,987,226

 

75.4

 

2,236,997

 

75.3

 

249,771

 

Total liabilities and equity

 

¥

2,636,704

 

100.0

 

¥

2,971,953

 

100.0

 

¥

335,249

 

 

Note: Accumulated other comprehensive income is as follows:

 

 

 

March 31, 2014

 

December 31, 2014

 

Increase
(Decrease)

 

 

 

(Yen in millions)

 

Net unrealized gains on securities

 

¥

293,783

 

¥

426,256

 

¥

132,473

 

Net unrealized losses on derivative financial instruments

 

(260

)

(499

)

(239

)

Pension adjustments

 

(21,101

)

(22,196

)

(1,095

)

Foreign currency translation adjustments

 

(21,459

)

42,572

 

64,031

 

Total

 

¥

250,963

 

¥

446,133

 

¥

195,170

 

 

12



 

(2) Consolidated Statements of Income and Comprehensive Income (Unaudited)

 

Consolidated Statements of Income

 

 

 

Nine months ended December 31,

 

Increase

 

 

 

2013

 

2014

 

(Decrease)

 

 

 

Amount

 

%

 

Amount

 

%

 

Amount

 

%

 

 

 

(Yen in millions and shares in thousands, except per share amounts)

 

Net sales

 

¥

1,071,388

 

100.0

 

¥

1,101,692

 

100.0

 

¥

30,304

 

2.8

 

Cost of sales

 

793,309

 

74.0

 

809,547

 

73.5

 

16,238

 

2.0

 

Gross profit

 

278,079

 

26.0

 

292,145

 

26.5

 

14,066

 

5.1

 

Selling, general and administrative expenses

 

188,383

 

17.6

 

201,923

 

18.3

 

13,540

 

7.2

 

Profit from operations

 

89,696

 

8.4

 

90,222

 

8.2

 

526

 

0.6

 

Other income (expenses) :

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and dividend income

 

16,937

 

1.6

 

21,653

 

2.0

 

4,716

 

27.8

 

Interest expense

 

(1,432

)

(0.2

)

(1,303

)

(0.1

)

129

 

 

Foreign currency transaction gains, net

 

3,351

 

0.3

 

2,607

 

0.2

 

(744

)

(22.2

)

Other, net

 

1,792

 

0.2

 

1,488

 

0.1

 

(304

)

(17.0

)

Total other income (expenses)

 

20,648

 

1.9

 

24,445

 

2.2

 

3,797

 

18.4

 

Income before income taxes

 

110,344

 

10.3

 

114,667

 

10.4

 

4,323

 

3.9

 

Income taxes

 

36,756

 

3.4

 

35,542

 

3.2

 

(1,214

)

(3.3

)

Net income

 

73,588

 

6.9

 

79,125

 

7.2

 

5,537

 

7.5

 

Net income attributable to noncontrolling interests

 

(4,224

)

(0.4

)

(5,154

)

(0.5

)

(930

)

 

Net income attributable to shareholders of

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Kyocera Corporation

 

¥

69,364

 

6.5

 

¥

73,971

 

6.7

 

¥

4,607

 

6.6

 

Per share information:

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to shareholders of

 

 

 

 

 

 

 

 

 

 

 

 

 

Kyocera Corporation:

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

¥

189.07

 

 

 

¥

201.63

 

 

 

 

 

 

 

Diluted

 

189.07

 

 

 

201.63

 

 

 

 

 

 

 

Average number of shares of common stock outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

366,873

 

 

 

366,865

 

 

 

 

 

 

 

Diluted

 

366,873

 

 

 

366,865

 

 

 

 

 

 

 

 

Notes:

(1)   Basic earnings per share attributable to shareholders of Kyocera Corporation is calculated 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 is calculated based on the diluted average number of shares of stock outstanding during each period.

(2)   “Per share information” during the nine months ended December 31, 2013 is calculated under the assumption that the stock split at the ratio of two-for-one of all common stock, which took effect on October 1, 2013, had been undertaken at the beginning of the year ended March 31, 2014.

 

13



 

Consolidated Statements of Comprehensive Income

 

 

 

Nine months ended December 31,

 

Increase

 

 

 

2013

 

2014

 

(Decrease)

 

 

 

Amount

 

Amount

 

Amount

 

 

 

(Yen in millions)

 

Net income

 

¥

73,588

 

¥

79,125

 

¥

5,537

 

Other comprehensive income (loss) — net of taxes

 

 

 

 

 

 

 

Net unrealized gains on securities

 

198,671

 

132,563

 

(66,108

)

Net unrealized losses on derivative financial instruments

 

(305

)

(281

)

24

 

Pension adjustments

 

(1,587

)

(1,114

)

473

 

Foreign currency translation adjustments

 

56,990

 

74,075

 

17,085

 

Total other comprehensive income (loss)

 

253,769

 

205,243

 

(48,526

)

Comprehensive income

 

327,357

 

284,368

 

(42,989

)

Comprehensive income attributable to noncontrolling interests

 

(11,116

)

(15,125

)

(4,009

)

Comprehensive income attributable to shareholders of Kyocera Corporation

 

¥

316,241

 

¥

269,243

 

¥

(46,998

)

 

(3) Notes to the consolidated financial statements

 

Cautionary Statement for Premise of a Going Concern

 

None.

 

Cautionary Statement for Significant Changes in Equity

 

None.

 

14



 

3. OTHER INFORMATION

 

Changes in accounting policies

 

Recently Adopted Accounting Standards

 

On April 1, 2014, Kyocera adopted Accounting Standards Update (ASU) No. 2013-04, “Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date.” This accounting standard requires an entity to measure obligations resulting from joint and several liability arrangements for which the total amount of the obligation within the scope of this guidance is fixed at the reporting date, as the sum of the following: (a) The amount the reporting entity agreed to pay on the basis of its arrangement among its co-obligors (b) Any additional amount the reporting entity expects to pay on behalf of its co-obligors. The accounting standard also requires an entity to disclose the nature and amount of the obligation as well as other information about those obligations. The adoption of this accounting standard did not have a material impact on Kyocera’s consolidated results of operations, financial condition and cash flows.

 

On April 1, 2014, Kyocera adopted ASU No. 2013-05, “Parent’s Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity.” This accounting standard resolves the diversity in practice about whether Accounting Standards Codification (ASC) 810-10, “Consolidation—Overall,” or ASC 830-30, “Foreign Currency Matters—Translation of Financial Statements,” applies to the release of the cumulative translation adjustment into net income when a parent either sells a part or all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a nonprofit activity or a business within a foreign entity. In addition, this accounting standard resolves the diversity in practice for the treatment of business combinations achieved in stages involving a foreign entity. The adoption of this accounting standard did not have a material impact on Kyocera’s consolidated results of operations, financial condition and cash flows.

 

On April 1, 2014, Kyocera adopted ASU No. 2013-11, “Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists.” This accounting standard requires an entity to present an unrecognized tax benefit, or a portion of an unrecognized tax benefit as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward in the financial statements. The adoption of this accounting standard did not have a material impact on Kyocera’s consolidated results of operations, financial condition and cash flows.

 

15


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