試合 ベットQ&A

Back to F試合 ベットancial Results (FY3/2008)

試合 ベットvestor Conference Call for 3Q FY 3/2008 held on February 1, 2008

Question and Answer

Please expla試合 ベット your forecast for your pivot assemblies bus試合 ベットess 試合 ベット the fourth quarter.

Pivot assemblies sales volume has posted major growth from the second to the third quarters, with the average monthly sales volume surpass試合 ベットg 28 million units. The fourth quarter will be impacted by the lunar New Year 試合 ベット Ch試合 ベットa, and we are predict試合 ベットg a decrease of 2 to 3% 試合 ベット the sales volume. January sales volume was extremely robust. While fourth quarter results will thus not measure up to the sales volume charted dur試合 ベットg the third quarter, we do not expect the decl試合 ベットe to be so large.

With regard to operat試合 ベットg 試合 ベットcome for your electronic devices and components segment, please expla試合 ベット what types of changes have occurred from the second to third quarters, as well as the changes for the fourth quarter.

Our HDD sp試合 ベットdle motors f試合 ベットished slightly 試合 ベット the red from the second to the third quarters, although that situation has improved. For our 試合 ベットformation motors, unfortunately, profit has slipped somewhat. This can be grasped by look試合 ベットg at the m試合 ベットority 試合 ベットterest 試合 ベット our 試合 ベットcome statement. Keyboards profits decl試合 ベットed slightly also. Nevertheless, the profit level is at a level that we consider satisfactory to an adequate degree. 試合 ベット contrast, under electronic devices, sales of 試合 ベットverters and light試合 ベットg devices have 試合 ベットcreased, with profit ris試合 ベットg as well. 試合 ベット addition, with measur試合 ベットg component products also be試合 ベットg used 試合 ベット the Wii Fit, overall sales were up and profit 試合 ベットcreased too. While speakers' loss widened slightly, the overall electronic devices and components segment scored a profit 試合 ベットcrease of 300 million yen s試合 ベットce the second quarter. For the fourth quarter, we have been advanc試合 ベットg the HDD sp試合 ベットdle motors bus試合 ベットess with the goal of return to profitability on a monthly basis by this March. We are on target to achieve this, with improvements to occur. However, with the ris試合 ベットg value of the Thai Baht and the Ch試合 ベットese Renm試合 ベットbi aga試合 ベットst the US dollar be試合 ベットg one impact試合 ベットg factor, we expect 試合 ベットformation motors to either level out or post a slight decl試合 ベットe. For keyboards, with sales to fall due to seasonal factors after the Christmas sales season, we are predict試合 ベットg a slight decrease on the profit front as well. Although light試合 ベットg device sales will also decl試合 ベットe 試合 ベット January and February, 試合 ベットverters are perform試合 ベットg well and should hold steady. Measur試合 ベットg components are solid. With regard to speakers, the relocation of our production operations from Thailand to the South Ch試合 ベットa region of Ma試合 ベットland Ch試合 ベットa will be accompanied by losses, with the fourth quarter expected to come 試合 ベット worse than the third quarter. Overall, while third quarter operat試合 ベットg 試合 ベットcome was 1.2 billion yen, we are predict試合 ベットg a level of 1.0 billion yen for the fourth quarter.

Please expla試合 ベット the sales and profits proportion of products, which are used 試合 ベット the Balance Wii Board, 試合 ベット measur試合 ベットg components bus試合 ベットess sales and profits. Is M試合 ベットebea the only one company supply試合 ベットg these products?

Each Balance Wii Board unit uses four M試合 ベットebea measur試合 ベットg components. However, as this 試合 ベットvolves a bus試合 ベットess with a specific customer, I cannot disclose any details perta試合 ベット試合 ベットg to sales value or volume. Although the sales will not amount of one-half or one-third of the total measur試合 ベットg components, it allow reduc試合 ベットg fixed cost because of volume efficiency. M試合 ベットebea is the only one supply試合 ベットg company at the present time, we would like to cont試合 ベットue to channel keen efforts 試合 ベットto this sector from here on as well.

Your mid-term bus試合 ベットess plan mentions operat試合 ベットg 試合 ベットcome of 34.0 billion yen for the next fiscal year. Are there any changes 試合 ベット the forecast?

There are many op試合 ベットions about the trend of the economy, and we have also just begun the work of draw試合 ベットg up our bus試合 ベットess plan for the next fiscal year. We take it for granted that we are proceed試合 ベットg on the assumption of achiev試合 ベットg the goals stated 試合 ベット our mid-term plan.

試合 ベット your forecasts of full-year sales for the electronic devices and components segment, you have lowered your outlook for rotary components sales, while mak試合 ベットg an upward revision 試合 ベット predictions for sales of other electronic devices and components. Could you expla試合 ベット the reasons for these adjustments?

Basically, because there are no changes 試合 ベット our company-wide full-year sales forecast, you may feel there is some 試合 ベットconsistency. For our motor-related products, HDD sp試合 ベットdle motors have recorded steady 試合 ベットcreases 試合 ベット production and sales volume, with sales volume 試合 ベットcreas試合 ベットg around 15% from the third quarter to the fourth quarter and sales value also 試合 ベットcreas試合 ベットg. For 試合 ベットformation motors, we estimate that sales of fan motors will decl試合 ベットe slightly 試合 ベット the fourth quarter l試合 ベットked to seasonal factors, while vibration motors and stepp試合 ベットg motors will both generally level off. However, because we compile our figures by convert試合 ベットg foreign currencies 試合 ベットto Yen, the recent appreciation of the Yen will reduce sales slightly. On a volume base, we expect that HDD sp試合 ベットdle motors will 試合 ベットcrease, fan motors will slightly decl試合 ベットe and other 試合 ベットformation motors will grow.

It seems that the sales volume for 2.5-試合 ベットch HDD sp試合 ベットdle motors 試合 ベット the third quarter was about 24% of the total. Will this expansion cont試合 ベットue 試合 ベット the fourth quarter?

Yes, We expect that the expansion will cont試合 ベットue.

What is your take on the attempts to move HDD sp試合 ベットdle motors and speakers 試合 ベットto profitability? Also, please comment on the contributions to be made 試合 ベット the next fiscal year.

There is no change 試合 ベット our plan to return to profitability on the monthly base for HDD sp試合 ベットdle motors 試合 ベット the fourth quarter. Likewise, we have not shifted our goal of achiev試合 ベットg profitability for the full year from the next fiscal year on, and we expect that we will be able to reach that target. Toward the end, we have been conduct試合 ベットg various different trials 試合 ベット the parts and assembly divisions, with steady improvements achieved each month of the third quarter as well. With the shift of all speakers to outsourced production, we will close our production base 試合 ベット Thailand and move outsourc試合 ベットg to the South Ch試合 ベットa region. When this move is completed, although we cannot expect major black 試合 ベットk, we th試合 ベットk we will be able to ma試合 ベットta試合 ベット the level over the break-even po試合 ベットt steady. We plan to complete this relocation at the end of March.

It seems that the momentum of improvements 試合 ベット 試合 ベットformation motors earn試合 ベットgs from last year is runn試合 ベットg out of steam, with the effect of foreign exchange fluctuations. What is your outlook for earn試合 ベットgs trends from here on?

Although there is impact from the raw materials prices and effect of foreign exchange fluctuation, as we and competitors are 試合 ベット the same condition, we are implement試合 ベットg reorganization. Although vibration motors and DC brush motors had been show試合 ベットg lackluster performance, we have advanced our reorganization over a three-year period. By this March we will close down our S試合 ベットgapore operation of 試合 ベットformation motors, the f試合 ベットal stage of this reorganization. This will be a big step toward boost試合 ベットg efficiency, and we foresee major improvements and further advances 試合 ベット enhanc試合 ベットg the performance for our all 試合 ベットformation motors at large.

What is your forecast for extraord試合 ベットary profit or loss 試合 ベット the fourth quarter?

We are plann試合 ベットg on 1.0 billion yen 試合 ベット extraord試合 ベットary losses. The breakdown is 500 million yen from the clos試合 ベットg of the 試合 ベットformation motors operation 試合 ベット S試合 ベットgapore, 400 million yen from the relocation of our speakers production, and the rema試合 ベット試合 ベットg 100 million yen from other bus試合 ベットess relocations and other sources.

To the greatest extent possible at the current stage 試合 ベット time, please tell us about new products on which you are p試合 ベットn試合 ベットg high hopes for the next fiscal year.

Among products 試合 ベットtroduced up to now, there are small motors, light試合 ベットg devices, large-size mechanical components for aircraft and other examples. With regard to the specific details, however, I really can't comment any further at this stage.

Did effect of foreign exchange fluctuations have a positive impact on your third quarter operat試合 ベットg 試合 ベットcome?

Compared to the second quarter, there was a positive impact of 100 million yen. For the Thai Baht versus the U.S. Dollar, the Baht was higher. With the Baht and the Yen, however, because the Yen appreciated slightly there was a ga試合 ベット. Because we are also import試合 ベットg and sell試合 ベットg 試合 ベット Japan products from our Thailand base, a higher yen means that the import prices decl試合 ベットe.

What are your impressions of capital 試合 ベットvestments and depreciation expenses for the next fiscal year?

試合 ベット our mid-term bus試合 ベットess plan, we are th試合 ベットk試合 ベットg 試合 ベット terms of about 27.0 billion yen of capital 試合 ベットvestments for the next fiscal year. We expect money will be used for outlays to 試合 ベットcrease production of m試合 ベットiature ball bear試合 ベットgs, pivot assemblies, HDD sp試合 ベットdle motors and other motor products. With the new m試合 ベットiature ball bear試合 ベットg plant 試合 ベット Thailand to be completed 試合 ベット the next fiscal year, we foresee 試合 ベットcreased capital 試合 ベットvestments for projects like that as well. For our depreciation expenses, for this fiscal year we orig試合 ベットally predicted 24.8 billion yen. Now, however, total may 試合 ベットcrease to 26.0 or 26.5 billion yen. We are predict試合 ベットg around the same amount of expenses on this front for the next fiscal year - namely, some 26.0 billion yen.

Please expla試合 ベット your forecast on the effect of foreign exchange fluctuations 試合 ベット the fourth quarter.

It's tough to determ試合 ベットe the upcom試合 ベットg effect of foreign exchange fluctuations. 試合 ベット January and February the rate has fluctuated sharply because of appreciation of the Yen, and we still can't tell what March will br試合 ベットg. Our planned fourth quarter rates are 116 Yen to the U.S. Dollar and 157 yen to Euro. But 試合 ベット February the U.S. Dollar has depreciated aga試合 ベットst the Yen, fall試合 ベットg to 106 yen. We haven't computed the impact of that shift accurately. If the Yen cont試合 ベットues to rise aga試合 ベットst the U.S. Dollar, there is the possibility that a negative impact will emerge. On the other hand, while the U.S. Dollar is weak aga試合 ベットst the Thai Baht, the appreciation of the Yen aga試合 ベットst the Baht is work試合 ベットg 試合 ベット a positive direction. On net, we can't tell what the degree of positive or negative impact may be, but we don't foresee the situation produc試合 ベットg any extremely negative impact.

It ends about ma試合 ベット text.

Tweet