Results for the Six Months Ended September 30, November 4, OMRON Corporation

Transcription

1 Results for the Six Months Ended September 30, 2003 November 4, 2003 OMRON Corporation 1

2 Contents 1. Summary of Results for the Six Months Ended September 30, Outlook for the Fiscal Year Ending March 31, 2004 :Page 4 :Page 13 Notes: 1. The financial statements are prepared in accordance with U.S. GAAP. 2. Includes 134 consolidated subsidiaries and 10 affiliated companies accounted for by the equity method. 3. Projections of results and future developments are based on information available to the Company at the present time, as well as certain assumptions judged by the Company to be reasonable. Various factors could cause actual results to differ materially from these projections. Major factors influencing Omron's actual results include, but are not limited to, (i) the economic conditions surrounding the Company's businesses in Japan and overseas, (ii) demand trends for the Company's products and services, (iii) the ability of the Omron Group to develop new technologies and new products, (iv) major changes in the fund-raising environment, (v) tie-ups or cooperative relationships with other companies, and (vi) movements in currency exchange rates and stock markets. 2

3 IAB: ECB: AEC: Business Domains Industrial Automation Business Manufacture and sale of control components for factory automation, etc. Electronic Components Business Manufacture and sale of electronics components for home appliances, mobile devices, etc. Automotive Electronic Components Business Manufacture and sale of electronic components for automobiles SSB: Social Systems Business * Equipment for financial institutions (ATMs, etc.), railway companies (automated passenger gates, etc.) and others * SSB consists of the Social Systems Solutions and Service Business Company and the Advanced Module Business Company (AMB). HCB: Healthcare Business Manufacture and sale of medical devices (digital blood pressure monitors,etc.) Others: Business Development Group/Others Exploration of new business, businesses not included in above 3

4 1. Summary of Results for the Six Months Ended September 30,

5 Six months ended September 30, 2003 Interim Results (Billions of yen) First Half Results Six Months Ended September 30, 2003 Six Months Ended September 30, 2002 % of Previous Period Net sales % % 109.4% Gross profit % % 119.1% SG&A expenses % % 109.0% R&D expenses % % 111.7% Operating income % % 188.0% Non-operating expenses % % 8.7% EBIT % % % Net income (loss) % % -79.1% 5

6 Six months ended September 30, 2003 Net Sales +9.4% billion billion +4.3% billion +12.0% +28.4% 0.5% +11.9% HCB SSB AEC ECB +8.6% +7.3% 9.0% +3.7% +12.6% IAB +6.4% 9/2002 9/2003 Initial Budget 6

7 Six months ended September 30, 2003 IAB +12.6% billion 98.2 billion +29% +15% +16% China Asia Europe +6.3% +6% +9% +6% billion -1% North America +3% +11% Japan +7% 9/2002 9/2003 Initial Budget 7

8 Six months ended September 30, 2003 ECB 38.9 billion +11.9% 43.5 billion +94% +17% +6% +15% -11% Direct Trade China Asia Europe North America +3.7% 42.0 billion +41% +9% -2% +4% -6% +12% Japan +3% 9/2002 9/2003 Initial Budget 8

9 Six months ended September 30, 2003 AEC 28.4 billion -0.5% 28.2 billion -8.9% 31.0 billion -3% +12% -10% Asia Europe North America -13% -7% -14% +7% Japan -3% 9/2002 9/2003 Initial Budget 9

10 Six months ended September 30, 2003 SSB 41.8 billion +28.4% 53.7 billion -25% Direct Trade +7.3% +8% 50.0 billion Japan +36% +8% 9/2002 9/2003 Initial Budget 10

11 Six months ended September 30, % 20.4 billion +53 % +3% +22 % +7% HCB 22.8 billion China Asia Europe North America Japan +19 % +32 % +8.7% +9% +10 % 21.0 billion +8% +4% 9/2002 9/2003 Initial Budget 11

12 Six months ended September 30, 2003 Operating Income Net effect of structural reform (Billions of yen) Sales growth Product mix Foreign exchange loss 11.5 Increased expenses (SG&A, R&D,etc.) 21.5 Six months ended September 30, 2002 Six months ended September 30,

13 Six months ended September 30, 2003 Cash Flows Six months ended September 30, 2003 Six months ended September 30, 2002 Net Cash Provided by Operating Activities Net Cash Used in Investing Activities Free Cash Flows Net Cash Provided by (Used in) Financing Activities Net Increase (Decrease) in Cash and Cash Equivalents Cash and Cash Equivalents at End of the Period 35.5 billion (15.5 billion) 20.0 billion (17.9 billion) (0.7 billion) 79.3 billion 15.0 billion (12.8 billion) 2.2 billion 10.7 billion 12.4 billion 83.2 billion 13

14 2. Outlook for the Fiscal Year Ending March 31,

15 Outlook for year ending March 31, 2004 Fiscal Year Forecast (Billions of yen) Fiscal Year Year Ending March 31, 2004 (Est.) Year Ended March 31, 2003 (Act.) % of Previous Period Net sales Gross profit SG&A expenses R&D expenses Operating income Non-operating expenses EBIT Net income % % 108.4% % % 115.1% % % 105.8% % % 114.3% % % 154.7% % % 14.5% % % 972.1% % % % 15

16 Outlook for year ending March 31, 2004 Sales Forecast for the Fiscal Year Ending March 31, billion Year ended March 31, % +10.4% +17.9% -1.6% +12.8% -30.9% +11.0% billion Year ending March 31, 2004 IAB ECB AEC SSB HCB % billion +4.7% +1.1% -7.9% +10.0% +8.0% -7.7% Initial Plan 16

17 Outlook for year ending March 31, 2004 IAB Sales Forecast billion Year ended March 31, % +10% -1% +13% +7% +22% billion Year ending March 31, % billion +7% Japan North America -1% +3% Europe Asia China +4% +2% Solutions Initial Budget Strengthen sales force Japan: Distribution agency system China: Strengthen sales bases, etc. Development of Solutions business Smart Sensors 17

18 Outlook for year ending March 31, 2004 ECB Sales Forecast 79.4 billion Year ended March 31, % 89.5 billion Year ending March 31, % 88.5 billion +9% Japan -4% -4% -1% +13% North America -7% Europe +6% -3% +140% +16% Asia China +3% Direct Trade +75% B-MLA Initial Budget Develop, introduce original products B-MLA, FPC Connector for mobile components etc. Strengthen sales capabilities FPC Connector 18

19 Outlook for year ending March 31, 2004 AEC Sales Forecast 59.4 billion Year ended March 31, % 58.5 billion Year ending March 31, % 63.5 billion -0% Japan -8% -4% North America -10% +3% +5% Europe Asia -3% -4% Automotive Relays Initial Budget Decline in number of cars sold by key customers in North America Strike at key customer in South Korea Power Window Switches 19

20 Outlook for year ending March 31, 2004 SSB Sales Forecast billion +17.9% Year ended March 31, billion +10.0% Year ending March 31, billion +22% Japan +13% -26% -15% Direct Trade Bill Processing Module Initial Budget Equipment to handle new bank note in Japan Approx billion Strong railway business (Ticket venders in Kanto, SF Card system in Chubu, etc.) Automated Passenger Gate 20

21 Outlook for year ending March 31, 2004 HCB Sales Forecast 42.3 billion Year ended March 31, % 47.0 billion Year ending March 31, % 43.5 billion +11% +8% Japan +7% +7% North America +9% +54% -4% Europe +8% +6% Asia China +20% Digital Blood Pressure Monitor Initial Budget Increasing global concern about health Top Brand evaluation (Consumer Reports) New product introductions (Chair massager, body-fat analyzer, etc. ) Nebulizer 21

22 Outlook for year ending March 31, 2004 Operating Income Forecast Sales growth Product mix (Billions of yen) 19.7 Net effect of structural reform 32.3 Increased expenses (SG&A, R&D, etc.) 50.0 Year ended March 31, 2003 Year ending March 31,

23 Outlook for year ending March 31, 2004 ROE Forecast ROE: % /2001 3/2002 3/2003 3/2004 (Est.) 3/2005 Target 10.0 ROE (Act./Est.) Planned ROE under GD2010 GD2010: Long-term vision to 2010 announced 5/

24 Outlook for year ending March 31, 2004 Results of Structural Reforms 1 Implementation Period From April 2002 to September 30, 2003 Tasks Reduction of Group fixed and variable expenses Targets 30.5 billion Results 32.4 billion Overseas production ratio 50% increase 52% increase Withdrawal from low-profit and unprofitable businesses 2 businesses 5 subsidiaries 8 businesses 11 subsidiaries 24

25 Outlook for year ending March 31, 2004 Results of Structural Reforms 2 Effect of structural reforms = 32.4 billion 18.0 billion Variable Exp. 5.0 billion General Exp. 5.0 billion Personnel Exp. 8.0 billion 7.5 billion 1.0 billion 5.9 billion 14.4 billion Variable Exp. 6.0 billion General Exp billion Personnel Exp billion billion billion ± 0 billion 30.5 billion Variable Exp. 6.5 billion General Exp. 8.5 billion Personnel Exp billion Effects in year ended 3/31/03 Estimated effects in year ending 3/31/04 Cumulative Effects Initial Plan 25

26 Outlook for year ending March 31, 2004 Results of Structural Reforms 3 Business Structure Consolidation/sale of 8 businesses/ 11 subsidiaries Reorganization of SSB, withdrawal from paper-handling business, sale of Omron Alphatech Corporation, dissolution of Creative Service Business Manufacturing Structure Purchasing Processes Management Productivity Head Office Structure Asset Structure Employment Structure Additional Measures Closed 3 factories in Japan, increased overseas production ratio by 50% Area for direct central purchasing of materials expanded 3.1 times Management staff reduced 21% 3 divisions, 3 departments eliminated through consolidation; head office fixed expenses reduced 14% Decision to sell 11 properties Consolidation of R&D bases Early retirement of 1,462 employees + more than 800 leave group Reductions in distribution / information expenses 26

27 Outlook for year ending March 31, 2004 Growth Areas Projections for growth in sales of products and technologies in expanding markets and business areas, with results for the year ended March 31, as a baseline 150 billion 26 billion 176 billion 171 billion Device Business MLA/ MEMS Business AEC Solutions Business User Segment Business Amusement Business Other Chinese Market IAB/ECB AMB/HCB 21 billion Year ended 3/31/03 Year ending 3/31/04 Initial Plan Year ending 3/31/04 Forecast Note: Certain figures above contain overlaps in products and regions. Sizes of boxes in the diagram are not proportional to monetary values. 27

28 Outlook for year ending March 31, 2004 B-MLA (Backlight-Micro Lens Array) Winner of 2003 Keidanren Chairman s Award from Japan Institute of Invention and Innovation High brightness High efficiency Simple structure Low power consumption Minimal color unevenness Microphotonics technology + Micro-replication processing technology 28

29 Outlook for year ending March 31, 2004 Microphotonics Technology (Technology to miniaturize and integrate various optical functions and control optical waves) + Micro-replication processing technology (Production technology) MLA P ー MLA B-MLA Front light DR-LED Fiber optic device Replicated polymer optical wave guide 29

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