MegaChips Corporation

Transcription

1 Innovation & Rebuild MegaChips Corporation Financial results r for the fiscal third-quarter ending March 2009 (3Q FY3/09) Jan

2 CONTENTS 1. 3Q FY3/09 Business Report Q FY3/09 Earnings Forecast Q FY3/09 Midterm Management Policy Summary

3 3Q FY3/09 Business Report 3

4 3Q FY3/09 Consolidated Performance 1Q Results 2Q Results 3Q Results 4Q Results 1H Forecasts 2H Forecasts ( Billions) Net Sales Operating Income Net Income FY3/08 FY3/09 Forecast (initial) Net sales: 43.2 billion (+ 7.8%) <78.6%> ( Billions) FY3/08 FY3/09 Forecast (initial) Operating income: 4.58 billion (+ 64.4%) <99.6%> ( Billions) FY3/08 FY3/09 Forecast (initial) Net income: 2.56 billion (+ 18.3%) <109.1%> * ( ): Changes from the same period last year (%); < >: Achievement rate vs full-year forecast (%) The merger with a subsidiary at the beginning of FY3/08 resulted in a tax adjustment that had the effect of increasing net income by about 770 million in FY3/08 ( 610 million for 1H FY3/08)

5 Operating Results for ASIC Business ( Billions) Net Sales FY3/08 FY3/09 Full-year forecast (initial) 5 Net sales : 36.6billion YoY basis: +5.5% Achievement rate against full-year forecast (initial): 81.4% The sales s increased on a year- over-year basis by strong demand of software-storage storage LSI for the hand-held held games. Sales are proceeding as planned.

6 Operating Results for ASSP and Electronic Components Business ( Billions) Net Sales 6.0 Net sales : 3.53billion YoY basis : -1.2% Achievement rate against full-year forecast (initial( initial): 59.0% FY3/08 FY3/09 Full-year forecast (initial) 6 The sales amount decreased on a year-over over-year basis. There was the strong demand for high- performance digital camera LSI and 1-seg tuner of the hand-held held games. However, the market demand for the portable phone 1-seg 1 LSI has greatly decreased. The target has not been achieved yet.

7 Operating Results for Systems Business ( Billions) Net Sales FY3/08 FY3/09 Full-year forecast (initial) 7 Net sales : 3.05 billion YoY basis : +70.1% Achievement rate against full-year forecast (initial( initial): 76.3% The sales s increased on a year- over-year basis by the strong demand for the new products of the customer-specific specific digital video surveillance systems. Sales are proceeding as planned.

8 LSI Business Systems Business Consolidated ( Millions) 3Q FY3/09 Summary of Consolidated Performance Results for Apr.- Dec. (1) Results for Apr.- Dec. (2) Forecast for whole year (3) YoY Basis (1)/(2) Vs. forecast (1)/(3) ASIC 36,613 34,704 45, % 81.4% ASSP and electronic components 3,537 3,537 3,581 6, % 59.0% Net sales 40,151 38,285 51, % 78.7% Operating income 4,513 3,397 4, % 98.1% Net sales 3,051 1,794 4, % 76.3% Operating income Net sales 43,203 40,079 55, % 78.6% Operating income 4,583 2,788 4, % 99.6% Ordinary income 4,729 2,697 4, % 100.6% Extraordinary loss % - Net income 2,564 2,167 2, % 109.1% Net income per share ( )( % 109.0% Note1: forecast for whole year(3) is the previous release in Oct 30th, Note2: The merger with a subsidiary at the beginning of FY3/08 resulted in a tax adjustment that had the effect of increasing net income by about 770 million in FY3/08 (about 610 million for 1H FY3/08). 8

9 3Q FY3/09 Consolidated Balance Sheets ( Millions) 50,000 Assets:High current ratio ( Millions) 50,000 Liabilities/Net Assets: Large amount of equity 40,000 30,000 35,329 6,530 37,264 5,986 40,000 30,000 35,329 4,020 8,000 37,264 3,046 11,000 20,000 17,653 22,565 20,000 10,000 10,000 21,437 20, ,074 FY3/08 Full-year 5,824 FY3/09 3Q 0 FY3/08 Full-year FY3/09 3Q Cash and cash equivalents Accounts receivable Inventories Other current assets Tangible/intangible fixed assets Investments and other assets FY3/08 Full-year 6,530 17,653 2, ,074 FY3/09 3Q 5,986 22,565 1, ,824 9 Accounts payable Interest-bearing debt Other current liabilities Other fixed liabilities Net assets FY3/08 Full-year 4,020 8,000 1, ,436 FY3/09 3Q 3,046 11,000 2, ,925

10 1H FY3/09 Consolidated Cash Flows Improvement in free cash flows ( Millions) 0 Operating cash flows Investing cash flows Free cash flows -2,000-4,000-1,374-1, ,633-6,000-8,000-7,080 FY3/08 3Q Apr.- Dec. - 8, FY3/09 3Q Apr.- Dec.

11 3Q FY3/09 Earnings Forecast 11

12 Sales and Earnings Forecasts for FY3/09 (vs. previous forecasts) ( Millions) FY3/09 Full-year forecast (revised) (1) FY3/08 Full-year forecast (initial) (2) YoY Basis (Full-year) (1)/(2) FY3/08 Full-year results (3) YoY Basis (Full-year (1)/(3) ASIC 45,000 45,000-43, % LSI Business ASSP and electronic components 4,500 6, % 5, % Net sales 49,500 51, % 48, % Operating income 4, , % 4, % Systems Business Net sales Operating income 4, , , Net sales 53,500 55, % 50, % Operating income 4,800 4, % 3, % Consolidated Ordinary income Extraordinary loss 4, , % - 3, % - Net income 2, , % 2, % Net income per share ( )( % % 12

13 3Q FY3/09 Midterm Management Policy 13

14 Midterm Growth Strategy No. 1 Fabless Venture Company in Japan The best solution to satisfy customer needs Concentrate on the customer-based business. Take full advantage of our skill in both LSI and system, and provide the best possible solution to the customer. Diversification of the business model Expand the business opportunity and customers with broad range of products from LSI to System. 1:IP sales 2:Hardware solution business by the chip-set, combination of our ASSP and the LSI from other company. 3:Module and board business with our LSI and software 4:Design service to major customers LSI and system products Diversification of core competence Improve the applied technology in addition to the hardware and software. 14

15 Shift to the customer-based business Structure Change(Feb 1, 2009) Future Policy 1 From the standard goods to compete on cost performance, shift to the customer-based business that brings high value to the leading accounts. New May 2008 Before 2007 System Business Division Business HQ Electronic Device & Module Business LSI Business Division # 2 LSI Business Division # Pursue customer-based business Build up long-term trustful relations: Improve order accuracy Stable demand:assess demand, avoid overstock High-value competition:avoid cost competition Establish recession-proof structure 1 Customer Specific Business HQ ASIC Business The organization that makes full use of the characteristics of both specific customers and core technology 15 Customer Specific System Specific-use Business HQ ASSP & Electronic Components LSI Business ASSP Business ASIC Business System Business System Business The organization that makes full use of the characteristics and advantage of each business field

16 Future Policy 2 Entry into new market and development Develop home infrastructure, Eco-business and energy field that are less vulnerable to the influence of market and expected to be increased in accordance with social needs. New Business Current Business Home infrastructure, Eco-business and Energy field Develop the market less affected by economic ups and downs. 16 Digital Appliances Game Security System

17 LSI Business Segment Business Domains Strengthen the operating base by diversifying products to current customers Establish relationships with new major customers Entertainment applications Amusement applications Application-specific memory products with highh igh-capacity, quick-delivery and advanced security Solutions for optional devices Solutions for portable game players and video game devices Develop potential customers (Products for application-specific memory and image processing, etc.) Current main products LSI for game cartridgesc used for portable player LSI for video game * Wii, NINTENDO DS, GAMEBOY ADVANCE and DS are registered trademarks and trademarks of Nintendo. 17

18 LSI Business Segment Business Domains Supply best solutions demanded in the dynamically changing digital era. - Expand the product portfolio from single LSI chip to the module - Develop IP business (R&D assets) Accelerate business operation with alliances Mobile D-TV D applications Digital camera applications Telecommunications applications Industrial applications Social infrastructure applications Supply products from single LSI to the module with embedded software Expand the telecommunications field Eco and security products using home network, power-line communication and wireless communication (ZigBee, etc.) Current main products System LSI 2007 Nintendo Module, IP, Software, etc. 18

19 Systems Business Segment Business Domain Aim to develop Systems Business into a consistently profitable business b by concentrating and specializing in customer-specific specific systems for security monitoring applications Expand the business by diversifying product portfolio to current customers Business security applications CCTV applications Home security applications Expand the product category of fully digital video surveillance systems (From small-scale scale security monitoring system to the large-scale system)) Strengthen network camera field Expand the range of products for home security systems Current main products Image transmission server Digital video recorder Video monitoring & security system Controller terminal for security system Network camera, etc. 19

20 Performance Indicators (Dividends / Share Repurchases) Fundamental Policy Annual dividend per share is based on a dividend payout ratio of about 30% of consolidated net income or 10 yen, whichever is higher. ( ) 30 Commemorative dividend (15 th anniversary) 20 Special dividend Ordinary dividend Special dividend (tax benefit from absorption of subsidiary) FY3/04 FY3/05 FY3/06 FY3/07 FY3/08 Stable dividend policy 20 Earnings-linked dividend policy

21 Key Investment Highlights In order to further expand the business, we will reinforce the customerc ustomer-specificspecific business and provide broad range of solutions from LSI to system as well as increasing business opportunity and customer base. Maximize our technical capabilities and concentrate in in the the customer-based business in in order to to diversify the the products to to the the existing accounts and develop leading customers. Nurture board/module business with our core LSI LSI and IP, IP, analog products and small-scale LSI, and aim to to expand business opportunity and new customers. Launch new business in in the the industry and social infrastructure fields. 21

22 IR Policy >> Purposes of investor relations and basic policy MegaChips bases investor relations activities on the principles of fairness, timeliness, accuracy and continuity. We provide information about strategies, finances and other items in order to increase the transparency of our operations. To earn the trust of shareholders, investors and securities analysts and receive a proper evaluation, senior management frequently participates in investor relations activities. >> Disclosure rules MegaChips discloses information in accordance with the Financial Instruments and Exchange Law, Company Law and other laws and regulations ( laws and regulations hereafter) and the Rules for Timely Disclosure of Corporate Information by Issuers of Listed Securities of the Tokyo Stock Exchange, where MegaChips shares are listed. Furthermore, even when not required by laws and regulations or disclosure standards in timely disclosure rules, we aggressively provide information that we believe has an effect on investment decisions by shareholders, investors and securities analysts and other information that we believe is useful to gain a better understanding of MegaChips. >> Disclosure method MegaChips distributes information using the Timely Disclosure network (TDnet) operated by the Tokyo Stock Exchange in accordance with timely disclosure rules. This includes information covered by the disclosure standards of the timely disclosure rules as well as information that we believe has an effect on investment decisions by shareholders, investors and securities analysts. In addition, we quickly post this information on the company Website. We also provide other information that we believe is useful to gain a better understanding of MegaChips by issuing IR publications or news releases and posting this information on the company Website. 22

23 IR Policy >> Forward-looking statements The information MegaChips discloses may contain forward-looking statements. These statements are based on the judgments of management based on information available when the information was disclosed and thus embody uncertainties and risks ( risks hereafter). Readers are cautioned to remember that actual results and other developments may differ from these forecasts for a number of reasons. Please refer to the Cautionary Statement on Risks section for more information. >> Investment decisions MegaChips discloses information for the purpose of giving people a better understanding of the company and not for the purpose of soliciting investments in securities issued by the company. Investors are asked to reach investment decisions on their own. >> Provision of third-party information about MegaChips Parties other than MegaChips, including securities analysts, the media and a variety of Internet information sites, announce information and forecasts about MegaChips. MegaChips is not in a position to comment on this information or express its support. However, if there is an obvious mistake in this third-party information that could cause a loss of trust in the company or prevent the company from receiving an appropriate evaluation, a correction will be announced and the proper information released. >> IR Quiet Period To prevent leaks of information about earnings releases that could affect its stock price as well as to ensure fairness, MegaChips observes a quiet period during the five business days prior to the earnings announcement for each quarter. During this period, the company will not make any comments involving financial performance. However, information covered by laws and regulations and timely disclosure rules will be disclosed even during this quiet period and management will respond to inquiries about this information. >> Other items Timely Disclosure Declaration (see Tokyo Stock Exchange Website) Summary of Timely Disclosure Framework (see Tokyo Stock Exchange Website) Standards for Information Disclosure (MegaChips internal regulations) 23

24 Inquiries to: PR, FINANCE & ACCOUNTING OFFICE, MegaChips Corporation 4-1-6, Miyahara, Yodogawa-ku, Osaka TEL: FAX: