Q&A

Latest Update : Nov.20, 2015

Back to Financial Results (FY3/2016)

Investor Meeting Presentation for 2Q FY 3/2016 held on November 5, 2015

* Some parts have been added and modified for a clearer understanding.

Question

Question and Answer

When we announced the initial forecast, we didn't know the exact prices of the assembly parts we were going to buy from external suppliers. That's why we made the latest revision to the sales forecast, which are mainly based on the differences between the estimated and actual purchase prices.
Some other figures, besides the parts purchase prices, were also lower than the original forecast figures due to the delay in ramping up production for a certain model.
I don't know exactly how much, percentage wise, our customers buy from us so I have no idea what the competition's share is. As far as I can tell from their sales figures, there doesn't seem to have been any major change in the supply ratio.
Yes. Demand from Chinese smartphone makers was lower and later than we expected, which is why our shipment volumes missed the mark.
Right now we don't see there being the need for the kind of large capital investments we've been making.
We expect to see a drop of at least several billion yen although it depends on how much we spend on capital investments next year.
We will in a way have to harness all our strengths for the models to be released next year and the year after. In the first phase of competition we will leverage the advantage of the accelerated depreciation method to maintain a strong operating foundation. The next phase will be, like always, a match between LCD and OLED. OLED may seem like it's reigning but LCD will make a comeback. That's because the technology is advancing. Making thinner smartphones with a high-definition 4K resolution screen means making thinner LED devices and thinner LED backlights as well. I think the LED backlight for 4K resolution screens is still too thick. We'll start anew to make thinner LED backlights for 4K resolution screens using the mold technology as well as other technologies we have developed over the years. We'll stick at it until we overcome all these sorts of technological hurdles. There's no end to technology.
When it comes to parts production, even if you make them per the required specifications, they may wind up being incompatible with other components once they are all put together. This can happen to LED backlights, bearings, or motors, and that's what caused the delay. Although our assemblies were not a perfect match at first, we worked to make them fit and fixed the problem. I don't know exactly how things are going with the competition but recent indication we've gotten from our customers are right on target and that tells me their end products are selling.
It wasn't a repair. What we did was adjustment of the manufacturing process, etc. to deal with a problem.
It all took a toll on operating income in the first half, mostly in the second quarter. Operating income for machined components was about 1.5 billion yen lower than initially projected. Operating income for electronic devices and components was also about 1.5 billion yen short of the target despite gains from motors and measuring components which partially offset the losses.
Yes, that will be a major factor. Plus we expect profitability from motors to rise and sales of measuring components to be better than projected.
We project that third quarter operating income will exceed 20 billion yen.
We've already started shipping them. No additional costs for fine-tuning will be incurred.
You seem to have pieced everything together correctly but I can't say for sure what's happening with the competition.
Like I said before, since I don't know exactly how much the competition is delivering, I cannot tell you what the supply ratio is. Last year we were able to figure out that the competition had a problem making its products to the customer's specs, but this year the new competitor is actually producing them. It's really anybody's guess.
These are head office expenses that include a number of small figures. While none of them are significant and worth noting, we reviewed and reduced some expense items in the second quarter.
Internal ball bearing shipment volume for September and October were 69 million units and 73 million units respectively and are estimated to reach 76 million units in November. Pivot assembly shipment volume for September and October totaled 30 million units and 27 million units respectively and are estimated to reach 28 million units in November.
Demand has been strong for applications like server fans, ATMs, and automobiles. Minebea bearings are also used for the majority of drones. It's not that there are any specific new applications. Ball bearings sales are just growing across the board.
Sales totaled 33.0 billion yen in September and 36.5 billion yen in October and are expected to exceed 40.0 billion yen in November.
Right now we don't think there is much chance of that happening, but we're not going to throw away all of our older production lines just because we've developed new lines.
The percentage ratios of ball bearing sales by application were 18% for automobile applications, 33% for aerospace applications, 4% for home appliance applications, 6% for office automation equipment applications, 4% for PC and peripheral applications, 17% for motor applications, and 19% for other applications. Sales grew year on year by 20% for automobile applications, 13% for aerospace applications, 27% for home appliance applications, 33% for office automation equipment applications, 52% for PC and peripheral applications, 16% for motor applications, and 13% for other applications.
It requires making thinner and stronger LED chips. On top of that, we three companies must work together to incorporate optical film into LED backlights that will pave the way to the thinnest ever displays with ultra-high definition 4K resolution. Although we haven't made them yet, we are in an ongoing technological battle against OLED. While we don't know which technology will win out, we are not just sitting around waiting to see what happens. We are continually plugging away.
According to our current projection, they will peak in November and gradually taper off after that. However, there are some orders coming later, including those for Chinese smartphone manufacturers, etc.
No.

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