OMRON Corporation Reports Fiscal 2012 Consolidated Performance Business Wire TOKYO -- April 25, 2013 OMRON Corporation (TOKYO: 6645) (ADR: OMRNY) today reported consolidated performance for fiscal 2012, ended March 31, 2013. Consolidated net sales for the year ended March 31, 2013 increased 5.0 percent compared with the previous fiscal year to JPY 650,461 million. Operating income increased 13.0% percent compared with the previous fiscal year to JPY 45,343 million. Income before income taxes was JPY 41,237 million, an increase of 22.9 percent year on year, and net income attributable to shareholders was JPY 30,203 million, up 84.3 percent year on year. Note: All amounts are rounded to the nearest million yen. 1. Overview of Conditions Conditions in the global economy during the year ended March 31, 2013 (fiscal 2012) remained uncertain overall, with factors such as continuing financial instability in Europe. However, signs of a recovery were seen in some regions, mainly in emerging markets. In Japan, events impacting the economy, including the effects of disasters that have occurred since 2011, are being resolved, but overall business conditions were flat due to a slump in the semiconductor industry and other factors. Conditions in Omron Group's Primary Related Markets Capital investment and component demand were Automotive-related: firm everywhere except in Europe. However, demand decreased in Japan in the second half. Capital investment and component demand were Semiconductor-related: weak, other than for smartphone-related projects. Machine tool-related: Demand was weak due to a drop in capital investment demand in some regions. Home appliance and electronic Capital investment and component demand were component-related: firm as a result of the higher functionality of large home appliances. Demand was firm due to an expanding range of Healthcare equipment-related: purchasers in connection with economic growth in emerging markets. The average exchange rates for the year ended March 31, 2013 were USD 1 = JPY 83.2 and EUR 1 = JPY 107.6 (3.9 yen more and 2.7 yen less respectively than the previous fiscal year). Consolidated Sales and Income Year ended Year ended Year-on-year March 31, March 31, change 2012 2013 Net sales 619,461 650,461 +5.0% Operating income 40,136 45,343 +13.0% [% of net sales] [6.5%] [7.0%] [+0.5P] Income before income taxes 33,547 41,237 +22.9% [% of net sales] [5.4%] [6.3%] [+0.9P] Net income attributable to 16,389 30,203 +84.3% shareholders Net income per share attributable 74.46 137.20 +62.74 to shareholders (basic) (JPY) Notes: 1. The number of consolidated subsidiaries is 153, and the number of companies accounted for by the equity method is 12. 2. "Net income attributable to shareholders" for the year ended March 31, 2012 includes reversal of deferred income tax assets (JPY 5,346 million) in connection with the enactment of the Law Concerning Reduction of the Corporate Income Tax Rate. Results by Business Segment Industrial Automation Business (IAB) IAB segment sales to outside customers for the fiscal year totalled JPY 262,983 million, a decrease of 2.9 percent compared with the previous fiscal year. In Japan, although capital investment demand in automotive-related industries was flat compared with the previous fiscal year, it was weak in electronic component-related industries and particularly in semiconductor-related industries. Consequently, sales were sluggish. Sales in Japan for the year ended March 31, 2013 decreased compared with the previous fiscal year due in part to the absence of the temporary rise in sales in the previous fiscal year from the impact of the Great East Japan Earthquake and floods in Thailand. Overseas, performance in the Americas was firm, supported by robust automotive-related industries. In Europe, demand was weak with the continuing impact of the economic downturn. In China, sales were firm, supported by solid demand, even with the absence of the temporary rise in sales in the previous fiscal year. Elsewhere in Asia, despite solid demand in ASEAN countries and emerging markets, sales were weak due to factors including restrained capital investment in semiconductor-related industries in South Korea. As a result, overseas sales for the year ended March 31, 2013 were basically unchanged from the previous fiscal year. Electronic and Mechanical Components (EMC) EMC segment sales to outside customers for the fiscal year totalled JPY 84,107 million, an increase of 1.3 percent compared with the previous fiscal year. In Japan, in the first half, there was a recovery in demand in the automotive and other industries, which had dropped due to impact of the Great East Japan Earthquake in the previous fiscal year. In the second half, demand was firm in infrastructure-related industries and grew in the office equipment, mobile telephone and other industries. As a result, sales in Japan for the year ended March 31, 2013 increased compared with the previous fiscal year. Overseas, in the Americas, demand was firm in the automotive industry but decreased in consumer industries. In China, exports were slack due to the weak economy in Europe, but new environment-related and other businesses were firm. In Europe, financial instability prolonged the economic downturn. As a result, overseas sales for the year ended March 31, 2013 were essentially unchanged from the previous fiscal year. Automotive Electronic Components Business (AEC) AEC segment sales to outside customers for the fiscal year totalled JPY 97,643 million, an increase of 14.8 percent compared with the previous fiscal year. In Japan, automotive demand was robust due to government support measures for the purchase of eco cars (extension of tax breaks, reintroduction of subsidies), strong sales of light motor vehicles and other factors. Sales in Japan for the year ended March 31, 2013 increased compared with the previous fiscal year. Overseas, demand for certain components was weak due to the impact of austerity policies and the deteriorating labor environment in European economies as a result of financial instability and a sharp drop in sales for Japanese automobile manufacturers in China. Overall, however, demand was strong among overseas automobile manufacturers and in emerging markets. As a result, overseas sales for the year ended March 31, 2013 increased substantially compared with the previous fiscal year, due in part to the rebound from the temporary decrease in sales caused by the impact of floods in Thailand. Social Systems Business (SSB) SSB segment sales to outside customers for the fiscal year totalled JPY 68,754 million, an increase of 20.2 percent compared with the previous fiscal year. Rail Transportation Systems Business Sales Passenger revenues of railway companies recovered due to factors including a rebound from the impact of the Great East Japan Earthquake, and firm demand for public transportation equipment renewal. In addition, the security and safety solutions business, centered on remote monitoring systems, was firm. As a result, sales for the year ended March 31, 2013 increased substantially compared with the previous fiscal year. Traffic and Road Management Systems Business and Other Sales Sales were strong in the traffic and road management systems business due to factors such as growth in the security and safety fields and other factors, despite a strong trend toward restraint in investment by customers due to the economic downturn in Japan. In the environmental solutions business, sales were strong in the growth fields of services related to solar power generation systems, storage battery systems, and visualization and control. Sales were also strong in the related maintenance business as a significant increase in demand for solar power generation products led to growth in related installations. Healthcare Business (HCB) HCB segment sales to outside customers for the fiscal year totalled JPY 71,520 million, an increase of 14.5 percent compared with the previous fiscal year. In Japan, healthcare equipment for household use, sales of digital blood pressure monitors and digital thermometers, which are core products, were strong as the impact of the Great East Japan Earthquake and other factors decreased. In addition, with new demand stimulated by the launch of new products (wrist blood pressure monitors, body composition monitors with communication functions, portable electric toothbrushes, massagers, sleep time monitors, and sleep monitors), overall sales were strong. Sales of equipment for use in medical institutions were firm, as a slight recovery trend became apparent in the investment stance of flagship hospitals. As a result, sales in Japan for the year ended March 31, 2013 increased compared with the previous fiscal year. Overseas, although demand in the markets of Southern and Eastern Europe remained weak, overseas sales were strong overall as demand for healthcare equipment continued to rise in emerging markets such as Russia, China and Southeast Asia. In addition, with a business alliance for sales of electric toothbrushes in Europe and the depreciation of the yen in the second half, overseas sales for the year ended March 31, 2013 increased substantially compared with the previous fiscal year. Other Businesses in the "Other" segment are primarily responsible for exploring and nurturing new business fields and nurturing/reinforcing business not handled by other internal companies. Segment sales to outside customers for the fiscal year totalled JPY 59,240 million, an increase of 10.7 percent compared with the previous fiscal year. Environmental Solutions Business Sales Sales volume of solar power condensers and other products increased substantially, driven by growing interest in the use of renewable energy with the start of a feed-in tariff system. Electronic Systems & Equipments Division Sales Although demand for uninterruptible power supplies was firm due to concerns about the electrical supply, sales were weak due to a decrease in demand from major customers for electronic device development and contract manufacturing services and industrial embedded computers. Micro Devices Business Sales Sales were strong due to an increase in demand for microphones and custom integrated circuits for industrial use. Backlight Business Sales Sales were firm due to an increase in demand in the smartphone market. 2. Consolidated Financial Position and Cash Flows Total assets increased by JPY 36,314 million compared with the end of the previous fiscal year. The main changes in assets were increases of JPY 15,607 million in notes and accounts receivable – trade and JPY 10,451 million in cash and cash equivalents, offset by a decrease of JPY 4,268 million in deferred income taxes. The main changes in liabilities were decreases of JPY 13,204 million in short-term debt and JPY 3,488 million in termination and retirement benefits. Shareholders' equity increased by JPY 46,122 million from the end of the previous fiscal year to JPY 366,962 million. The shareholders' equity ratio increased by 4.3 percentage points to 64.0% from 59.7%. Net cash provided by operating activities was JPY 53,058 million (an increase of JPY 21,112 million compared with the previous fiscal year) due to JPY 30,117 million in net income as well as a decrease in inventories and other factors. Net cash used in investing activities was JPY 28,471 million (an increase in cash outflow of JPY 1,985 million compared with the previous fiscal year) because of investments for production facilities and other purposes. Net cash used in financing activities totaled JPY 18,550 million (a decrease in cash outflow of JPY 14,942 million compared with the previous fiscal year) because of repayment of loans and payment of dividends. As a result, the balance of cash and cash equivalents at March 31, 2013 was JPY 55,708 million. Consolidated Financial Position Millions of yen – except per share data and percentages As of March 31, 2013 As of March 31, 2012 Total assets 573,637 537,323 Net assets 368,763 321,680 Shareholders' equity 366,962 320,840 Shareholders' equity ratio (%) 64.0 59.7 Shareholders' equity per share 1,667.04 1,457.51 (JPY) Consolidated Cash Flows Millions of yen Year ended Year ended March 31, 2013 March 31, 2012 Net cash provided by operating activities 53,058 31,946 Net cash used in investing activities (28,471) (26,486) Net cash used in financing activities (18,550) (33,492) Cash and cash equivalents at end of period 55,708 45,257 3. Dividends In accordance with the policy stated above, Omron plans to pay an ordinary year-end dividend of JPY 18 per share for the year ended March 31, 2013 as well as a commemorative dividend of JPY 5 to show its appreciation for its stockholders on the eightieth anniversary of the founding of Omron on May 10, 2013, for a total of JPY 23 per share. For the full fiscal year, including the interim dividend of JPY 14 per share paid on December 3, 2012, Omron plans to pay total dividends of JPY 37 per share. Year ended Year ended Year ending March 31, March 31, March 31, 2014 2012 2013 (projected) 1st quarter — — — dividend (JPY) Interim dividend 14.00 14.00 18.00 (JPY) Dividends per 3rd quarter — — — share dividend (JPY) Year-end dividend 14.00 23.00 — (JPY) Total dividends for 28.00 37.00 — the year (JPY) Total cash dividends paid (JPY 6,164 8,145 million) Payout ratio (%) 37.6 27.0 — Dividends / Shareholders' equity 1.9 2.4 ratio (%) Notes: 1. Breakdown of year-end dividend for the year ended March 31, 2013: Regular dividend JPY 18.00; commemorative dividend JPY 5.00 2. Year-end dividend for the year ending March 31, 2014 is undetermined. 4. Fiscal 2013 Consolidated Performance Forecast Although there are expectations for a global recovery, due to factors including the continuing uncertain economic conditions in Europe, a gradual recovery is forecast from the second quarter. In Japan, although there is expectation regarding the new economic policies and weakening of the yen, economic uncertainty continues, so gradual recovery is forecast from the second quarter. Overseas, despite persistent financial instability in Europe, gradual economic expansion is forecast as a result of a pickup in the U.S. and Chinese economies and continued growth in emerging markets, particularly in ASEAN countries. In this environment, Omron Group has set its policy for the year ending March 31, 2014, the third year of VG2020, which started in July 2011, as "Complete the GLOBE Stage! Complete the transformation to a stronger Omron with greater growth, profitability, and adaptability to change." As its action plan, Omron Group will prioritize efforts including maximization of the strength of the industrial automation business, growth in emerging markets, expansion of new business fields, conclusion of profit structure reform and strengthening of global human resources. With the impact of the depreciation of the yen on currency translation in addition to the above premises, Omron Group forecasts substantial increases in sales and profits for the year ending March 31, 2014. Omron Group forecasts net sales of JPY 710.0 billion, operating income of JPY 58.0 billion, income before income taxes of JPY 56.5 billion, and net income attributable to shareholders of JPY 40.0 billion. The assumed exchange rates are USD1 = JPY 90 and EUR1 = JPY 120. Projected Results for Fiscal 2012 (Ending March 31, 2013) Millions of yen, except exchange rate data Year ended March Year ending 31, Change 2013 (results) March 31, 2014 Net sales 650,461 710,000 +9.2% Operating income 45,343 58,000 +27.9% Income before income taxes 41,237 56,500 +37.0% Net income attributable to 30,203 40,000 +32.4% shareholders Average JPY to USD exchange 83.2 JPY 90.0 JPY +6.8 JPY rate Average JPY to EUR exchange 107.6 JPY 120.0 JPY +12.4 JPY rate About OMRON Headquartered in Kyoto, Japan, OMRON Corporation is a global leader in the field of automation. Established in 1933, Omron has more than 35,000 employees in over 35 countries working to provide products and services to customers in a variety of fields including industrial automation, electronic components, social systems, healthcare, and the environment. The company has regional head offices in Singapore (Asia Pacific), Beijing (Greater China), Amsterdam (Europe, Africa, and the Middle East), Chicago (the Americas), Gurgaon (India), and Sao Paulo (Brazil). For more information, visit OMRON's website at http://www.omron.com/ Contact: Omron Corporation Takayoshi Oue, +81-75-344-7070 General Manager, Accounting and Finance Center
OMRON Corporation Reports Fiscal 2012 Consolidated Performance
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