Latest Update : Feb.10, 2015
Overview for the 3Q of FY 3/2015 (From April 1, 2014 to December 31, 2014)
The Japanese economy experienced a gradual overall recovery during the first nine months of the fiscal year (April 1, 2014 to December 31, 2014) as the Bank of Japan's monetary policy coupled with the weak yen boosted corporate earnings and employment despite a slowdown in consumer spending due to the consumption tax hike. Fueled by growing consumer spending as well as increased capital expenditures and improved employment that went hand in hand with higher corporate earnings, the U.S. economy continued to gradually pick up steam. The European economy managed to steadily inch forward in the shadow of the lingering sovereign debt crisis and Ukrainian political crisis that triggered economic sanctions against Russia whose economy was already reeling from declining crude oil prices. In Asia, on the other hand, ASEAN countries enjoyed moderate economic recoveries while China saw its economic growth rate decline in the face of an assortment of major problems.
Working against this backdrop, the Minebea Group has been focusing on creating high-value-added products, developing new technologies, enhancing its marketing approach, and cutting costs to boost profitability further.
As a result, net sales increased by 84,027 million yen (30.2%) year on year to reach 361,961 million yen. Operating income rose 20,526 million yen (88.0%) year on year to total 43,842 million yen, and ordinary income was up 23,114 million yen (114.9%) year on year at 43,235 million yen. Net income for the quarter also increased 15,100 million yen (95.1%) year on year to reach 30,980 million yen. The positive effect of the foreign exchange market, including the weak yen, gave an extra boost to our financial performance and we achieved substantial earnings and profit increases.
Performance by Segment for the 3Q of FY 3/2015 (From April 1, 2014 to December 31, 2014)
Machined Components Business Segment
Products in our Machined components business segment include our mainstay, ball bearings, in addition to mechanical components such as rod-end bearings used primarily in aircraft and hard disk drive (HDD) pivot assemblies, etc., as well as fasteners for automobiles and aircraft. Ball bearings enjoyed increases in both sales and profits as demand grew in major markets. Buoyed by growing demand for electric as well as other energy-efficient vehicles, sales to the automobile industry were particularly robust. Sales of aircraft rod-end bearings rose on the wings of soaring sales in the civil aviation market where demand was particularly strong for energy-efficient planes. Pivot assembly sales and profits were also up thanks to growing demand from the HDD market for high-end products used in PCs, data centers, etc.
All these factors combined brought net sales for the first nine-month period up 9,978 million yen (9.6%) year on year to total 113,463 million yen. Operating income also jumped 5,361 million yen (22.3%) year on year to total 29,410 million yen.
Electronic Devices and Components Business
The core products of our Electronic devices and components business include electronic devices (LED backlights for LCDs and measuring components, etc.), HDD spindle motors, information motors (stepping motors, DC brushless motors, DC brush motors, and fan motors), precision motors, and special devices. Sales and profits of LED backlights for LCDs soared. This increase resulted from a surge in demand for Minebea products boasting both a technological and supply edge in the growing market for high-end smartphones. Efforts to expand the customer base for our measuring components paid off and we saw both sales and profits steadily increase. Our Electro Mechanics Solutions (EMS) business also enjoyed sales and profit growth. Sales of rotary components like HDD spindle motors, information motors, etc. also rose. The information motors business, in particular, saw increases in both sales and profits thanks to growing sales to the office automation, automobile, and other markets. Cost cutting efforts aligned with the transfer of manufacturing operations for some products to our Cambodian plant, as well as improved quality and production efficiency also contributed to the better performance.
In the end, net sales for the first nine-month period were up 73,584 million yen (42.4%) year on year to total 247,285 million yen. Operating income rose 13,973 million yen (190.7%) year on year to reach 21,302 million yen.
Other Business Segment
Net sales for the first nine months in our Other business segment, which includes dies and parts produced in-house, were up 463 million yen (61.9%) year-on-year to total 1,211 million yen. Operating income also increased, rising 55 million yen (6.5%) year on year to total 905 million yen.
In addition to the figures noted above, 7,776 million yen in corporate expenses, etc. not belonging to any particular segment has been recorded as adjustments. Adjustments for the first nine-month period of last fiscal year amounted to 8,912 million yen.
Analysis of Financial Position for the 3Q of FY 3/2015 (From April 1, 2014 to December 31, 2014)
Assets, Liabilities, and Net Assets
The Minebea Group sees "strengthening our financial position" as a top priority and is taking various steps toward that end. While we aim for efficient asset management and reducing capital expenditure along with interest-bearing debts, over the past few years we have been making aggressive capital investments with an eye to expanding our business operations.
Total assets at the end of the current third quarter amounted to 487,212 million yen, up 105,934 million yen compared to the end of the previous fiscal year. The main reasons for this uptick include increases in notes and accounts receivable, inventories, as well as tangible fixed assets. Total liabilities amounted to 261,222 million yen, up 43,408 million yen over what it was at the end of the previous fiscal year. This jump was primarily due to increases in notes and accounts payable. Net assets totaled 225,990 million yen, up 62,527 million yen over what it was at the end of the previous fiscal year. Equity ratio rose 3.6 percentage points above what it was at the end of the last fiscal year to reach 45.0%.
Condition of Cash Flows
The balance of cash and cash equivalents at the end of the current third quarter was 37,030 million yen, up 7,998 million yen from what it was at the end of the previous fiscal year and up 11,479 million yen on a year-on-year basis.
Cash flows from various business activities for the first three quarters and other relevant factors are as follows:
Net cash provided by operating activities amounted to 32,493 million yen, up 545 million yen year on year due to increases in income before income taxes and minority interests, notes and accounts receivable, notes and accounts payable as well as inventories, along with depreciation and amortization costs, etc. Net cash used for investment activities decreased 3,050 million yen year on year to total 16,878 million yen due to the acquisition of tangible and intangible fixed assets, the sales of stocks of subsidiaries and affiliates, etc. Net cash used for financing activities declined 6,792 million yen year on year due to a cash outflow of 9,806 million yen for the repayment of short-term loans as well as dividend payments, etc.
The content of this page is based on information included in the "Brief Report for the Third Quarter of Fiscal Year Ending March 2015 (From April 1, 2014 to December 31, 2014)" announced on February 3, 2015.