Latest Update : Nov.11, 2015
Overview for the 1H of FY 3/2016 (From April 1, 2015 to September 30, 2015)
The Japanese economy continued to stagnate during the first half of the fiscal year (April 1, 2015 to September 30, 2015). Despite signs of improved consumer spending, both manufacturing and exports remained flat as corporations took a cautious approach to making capital investments. At the same time the U.S. economy continued to grow, mainly in the household sector. The robust non-manufacturing sector increased employment and income opportunities while the manufacturing industry lost steam. Fueled by local consumption, the European economy remained on an upward trajectory despite declining exports to non-EU countries. In Asia, although China's GDP didn't drop, a picture of economic uncertainty came into focus as manufacturing companies with excess production capacity and real estate developers put the brakes on investing. Despite the fact that ASEAN countries, whose economies rely largely on China, didn't see exports to China grow, they enjoyed moderate economic recoveries as exports to the U.S. and Europe as well as domestic demand picked up.
Working against this backdrop, the Minebea Group has been focusing on cutting costs, creating high-value-added products, developing new technologies, and honing its marketing approach in order to boost profitability further.
As a result, net sales were up 78,997 million yen (36.5%) year on year to total 295,554 million yen for a first half record high. Operating income also grew 2,656 million yen (10.7%) year on year to reach 27,417 million yen for another first half record high. Ordinary income was down 1,309 million yen (-5.3%) year on year at 23,326 million yen due to foreign currency exchange losses. Net income attributable to owners of the parent totaled 17,758 million yen for a 59 million yen (-0.3%) year-on-year drop.
Performance by Segment for the 1H of FY 3/2016 (From April 1, 2015 to September 30, 2015)
Commencing with the first quarter consolidated accounting period, Minebea has made some organizational changes, including incorporating its in-house manufacturing division into the Electronic devices and components manufacturing headquarters. Due to these changes, the segment information has also been changed.
Segment information for last fiscal year's first six-month period is disclosed using the new classification for reportable business segments implemented subsequent to the structural reorganization.
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. Growing demand in all major markets fueled sales of ball bearings. Sales were particularly robust in the automobile market where demand for energy-efficient models equipped with safety devices soared. Sales of rod-end bearings used in aircraft were also upbeat. Pivot assembly sales dipped slightly in the face of the shrinking HDD market, but improved production efficiency drove operating income up.
In the end, net sales for the first six-month period were up 9,560 million yen (13.0%) year on year to total 83,247 million yen. Operating income was also up 845 million yen (4.4%) year on year, totaling out at 20,175 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, stepping motors, DC motors, fan motors, precision motors, and special devices. Surging demand buoyed sales of LED backlights for LCDs as market preferences shifted to high-end smartphones. The Company's LED backlights for LCDs have the technological edge when it comes to making thinner products and with more components command a higher price. Sales of measuring components also rose substantially due partly to the acquisition of the Sartorius Mechatronics T&H Group in the previous fiscal year. HDD spindle motor sales increased despite a continually shrinking HDD market while sales of stepping motors and other motors grew mainly in the office automation equipment and automobile markets.
All these factors combined brought net sales for the first six-month period up 69,272 million yen (48.5%) year on year to total 212,064 million yen. Operating income was also up 1,915 million yen (18.4%) year on year, reaching 12,349 million yen.
Other Business Segment
First half net sales in our Other business segment, which includes machines produced in-house, rose 165 million yen (212.5%) year on year to total 242 million yen. The segment posted an operating income total of 24 million yen for a year-on-year decrease of 94 million yen (-79.6%).
In addition to the figures noted above, 5,130 million yen in corporate expenses, etc. not belonging to any particular segment has been recorded as adjustments. Adjustments for the first half of last fiscal year amounted to 5,121 million yen.
Analysis of Financial Position for the 1H of FY 3/2016 (From April 1, 2015 to September 30, 2015)
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. We have been reducing total assets and interest-bearing debts as well as cutting back on capital investments. Over the past few years, however, we have been making aggressive capital investments to enhance our business performance.
Total assets at the end of the first half amounted to 538,542 million yen, up 48,499 million yen compared to the end of the previous fiscal year. The main reasons for this uptick include increases in notes and accounts receivable as well as inventories. Total liabilities amounted to 301,778 million yen, up 45,415 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 236,764 million yen for a 3,085 million yen gain over what it was at the end of the previous fiscal year. The equity ratio was 42.5%, down 3.6 percentage points from what it was at the end of the last fiscal year.
Condition of Cash Flows
The balance of cash and cash equivalents at the end of the second quarter was 30,771 million yen. That's down 5,366 million yen from what it was at the end of the previous fiscal year but up 1,588 million yen on a year-on-year basis.
Cash flows from various business activities during the first fiscal half and relevant factors are as follows:
Net cash provided by operating activities amounted to 13,214 million yen. That figure is down 5,913 million yen year on year due to increases in income before income taxes, notes and accounts receivable, notes and accounts payable, as well as inventories, and depreciation and amortization costs. Net cash used for investment activities increased 17,289 million yen year on year to total 27,150 million yen due primarily to the acquisition of tangible fixed assets and transfers to time deposits. Net cash from financing activities was up 18,786 million yen year on year due to a cash inflow of 8,967 million yen for increase in short-term loans, and dividend payments, etc.
The content of this page is based on information included in the "Brief Report for Second Quarter of Fiscal Year Ending March 2016 (From April 1, 2015 to September 30, 2015)" announced on November 5, 2015.