Kyocera Corporation Financial Presentation

Kyocera Corporation Financial Presentation
( Six Months ended October 31, 2003)
November 7, 2003
KYOCERA Corporation
Forward-Looking Statements
Certain of the statements made in this document are forward-looking statements
(within the meaning of Section 21E of the U.S. Securities and Exchange Act of 1934),
which are based on our current assumptions and beliefs in light of the information
currently available to us. These forward-looking statements involve known and
unknown risks, uncertainties and other factors. Such risks, uncertainties and other
factors include, but are not limited to: general economic conditions in our markets,
which are primarily Japan, North America, Europe, and Asia, including in particular
China; changes in exchange rates, particularly between the yen and the U.S. dollar
and Euro, respectively, in which we make significant sales; our ability to launch
innovative products and otherwise meet the advancing technical requirements of our
customers, particularly in the highly competitive markets for ceramics, semiconductor
parts and electronic components; and the extent and pace of future growth or
contraction in information technology-related markets around the world, including
those for communications and personal computers. Such risks, uncertainties and
other factors may cause our actual results, performance, achievements or financial
position to be materially different from any future results, performance, achievements
or financial position expressed or implied by these forward-looking statements. We
undertake no obligation to publicly update any forward-looking statements included in
this document.
1
Business Environment Forecast
— Year Ending March 31, 2004 —
■ Economy: Persistent economic uncertainty in 2H
Slowdown in growth of the U.S. economy; weaker dollar, stronger yen
Assumed Exchange Rates: (2H) US$1=¥109; 1 Euro=¥126
(full year) US$1=¥114; 1 Euro=¥130
(Negative impact, compared with fiscal March 2003, of approx.
¥43.1 billion on sales and of approx. ¥3.9 billion on pre-tax income
on a full-year basis)
■ IT Industries: Expect revitalization in production of electronic equipment due to increased
demand for advanced mobile phones, computer equipment, DSCs, etc.
CY2003 global shipment volume forecast (forecast by the Company)
Mobile Handsets: Between 440-450 million units (approx. 10 % increase compared with CY2002)
Anticipate rise in demand for color LCDs and camera-equipped mobile
handsets overseas and mobile data communications terminals in Japan.
PCs: Between 142-145 million units (approx. 7-10% increase compared with CY2002)
DSCs : Approx. 40 million units (up 30 % on CY2002)
Component Prices: Expect annual price decline of approx. 10% for general electronic
components
With respect to the information on this page, please refer to the accompanying note on page 1.
2
Consolidated Financial Forecast
— Year Ending March 31, 2004 —
Year ending March 31, 2004
(Unit: Millions of yen)
Year ended March 31, 2003
Percentage
change
Amount
% to net
sales
Amount
% to net
sales
1,140,000
100.0
1,069,770
100.0
6.6
Profit from operations
75,000
6.6
83,388
7.8
-10.1
Pre-tax income
79,000
6.9
76,037
7.1
3.9
Net income
50,000
4.4
41,165
3.8
21.5
EPS (Diluted - yen)
269.10
–
220.86
–
21.8
Capital expenditures
52,000
4.6
40,614
3.8
28.0
Depreciation
59,000
5.2
64,988
6.1
-9.2
R&D expenses
46,000
4.0
47,268
4.4
-2.7
U.S. dollar (Yen)
114
–
122
–
–
Euro (Yen)
130
–
121
–
–
Net sales
Average exchange rates:
With respect to forecasts and targets, please refer to the accompanying note on page 1.
3
Consolidated Sales Forecast by Operating Segment
（Unit: Billions of yen）
300
252.9
Net Sales
238.9
Fine Ceramics Group
Operating Profit Ratio
（Unit: Billions of yen）
255.0
30
20.1
0
3/02
（Unit: Billions of yen）
3/03
Net Sales
300
234.9
228.0
0
3/04 (Forecast)
3/02
28.1
（Unit: Billions of yen）
12
11.0
7.9
3/03
Electronic Device Group
251.0
（Unit: %）
18.8
8.0
15
150
Operating Profit
6
3/04 (Forecast)
Operating Profit
0
（Unit: %）
16
8
11.8
5.2
150
4
8
4.4
2.8
1.9
0
3/02
3/03
3/04 (Forecast)
0
3/02
3/03
1.1
3/04 (Forecast)
0
Commencing in the f iscal y ear ended March 31, 2003, basic R&D expenses of the Company itself, previously included within “Others,” hav e been charged to the
respective operating segments. Accordingly, the Company has also reclassified previously published operating profit of such operating segments f or the f iscal
y ear ended March 31, 2002.
With respect to forecasts and targets, please refer to the accompanying note on page 1.
この予想につきましては、1ページに記載の注記にご留意下さい。
4
Measures to Boost Profitability of
Electronic Device Group
Target: Achieve double digit pre-tax income ratio by FY05
Establish new sales subsidiaries
Sell a broad range of Kyocera Group products
Crystal components
Kinseki, Kyocera
Raise pre-tax income ratio of the Company’s ceramic
capacitor business to double digits by the end of
March 2004
Connectors
KYOCERA ELCO
Capacitors
• Introduce divisional organization system
• Proceed further structural reform
Enhance production efficiency and reduce lead-time
• Write down of tantalum material
• Integrate production bases for ceramic capacitors
• Establish product development system that meets
with production process development
inventory and long-term purchase
agreements (¥10.4 billion)
• Forecast reduction in raw material costs in 2H
Kyocera
With respect to the information on this page, please refer to the accompanying note on page 1.
AVX
5
Pursue Synergies with Kinseki, Ltd.
Rapidly Achieve Pre-Tax Profit Ratio of 15%
Create a Highly Competitive Structure through Integrated Technologies
Technologies
Crystal-Related Components Business
Ending March 2006
Sales Target
¥55.0 billion
スペック
Digital home appliances / optical devices / automotive
Targeted Markets
Expected Synergies
•
Integrate technologies from materials to ultra-small packaging
•
Expand sales of electronic components through single sales network
<Restructure Crystal Components Business>
• Shift R&D and production to Kinseki
• Integrate sales into Kyocera
(Planned f or April 2004)
Business Structure
Kinseki
Create New
Technology/Markets
•
•
Integration
High-purity crystal technology
High market share in optical
products/broadcasting market
With respect to the information on this page, please refer to the accompanying note on page 1.
Kyocera
Technology to miniaturize
analog/digital TCXOs
6
Consolidated Sales Forecast by Operating Segment
Equipment Group
（Unit: Billions of yen）
600
478.3
Net Sales
529.8
（Unit: Billions of yen）
553.0
50
3/02
（Unit: Billions of yen）
100
86.1
3/03
0
3/04 (Forecast)
Operating Profit
（Unit: %）
10
40.0 7.6
24.4
25
300
0
Operating Profit Ratio
30.5
5.1
3/02
5.5
5
3/03
3/04 (Forecast)
Others
Net Sales
99.0
86.2
（Unit: Billions of yen）
Operating Profit
12
8.6
7.4
50
8.4
（Unit: %）
10.8
12
10.9
7.2
6
6
0
3/02
0
3/03
3/04 (Forecast)
0
3/02
3/03
3/04 (Forecast)
0
Commencing in the f iscal y ear ended March 31, 2003, basic R&D expenses of the Company itself, previously included within “Others,” hav e been charged to the
respective operating segments. Accordingly, the Company has also reclassified previously published operating profit of such operating segments f or the f iscal
y ear ended March 31, 2002.
With respect to forecasts and targets, please refer to the accompanying note on page 1.
7
Information Equipment: Product Development Strategy (1)
Color MFPs
Monochrome
MFPs
FY20 04
Ne w
FY20 04
Ne w
26cpm A3
Tandem Color
FY20 04
Ne w
8/31cpm A3
1-drum Color
Color Printers
26ppm A3
Tandem Color
63cpm A3
75cpm A3
FY20 04
Ne w
FY20 04
Ne w
FY20 04
Ne w
8/31ppm A3
1-drum
Color
FY20 04
Ne w
FY20 04
Ne w
45/55cpm A3
30/40/50cpm A3
FY20 04
Ne w
FY20 04
Ne w
16/20cpm A3
16cpm A3
16ppm A4
Tandem Color
18cpm A4
FY20 04
Ne w
15cpm
A4
FY20 04
Ne w
FY20 04
Ne w
A3
20ppm A3
A4
Monochrome
Printers
25ppm A3
28/36ppm A3
A4
24ppm A4
A4
18ppm A4
14ppm A4
This roadmap is subject to change.
8
Information Equipment: Product Development Strategy (2)
Enhance Kyocera Mita Color Tandem Machines
Utilize Kyocera’s long-life cycle “Amorphous Silicon Photoreceptor Drums”
Utilize Kyocera’s “Advanced Beam Array” optical unit
16 ppm A4 tandem printer
26 ppm A3 tandem printer
26 cpm A3 tandem MFP
LS-C5016N
LS-C8026N
KM-C2630
Printer
Printer
Features:
• World’s smallest design*
• Low est TCO
• Includes cutting-edge technology for
v ibrant images
Printer
Printer
Features:
• High-speed printing (color 26 ppm)
• Low est TCO
• Enhanced optional functions
(book binding etc.)
• Smallest available A4 tandem color printer
(as of Nov. 7, 2003)
With respect to the information on this page, please refer to the accompanying note on page 1.
MFP
MFP
Features:
• Long-life design, less maintenance
required
• Can include printer/scanner/FAX
• Enhanced optional functions
(book binding etc.)
9
Measures to Boost Profitability
of CDMA Handset Business
Pursue Group Synergies
- Promote efficient utilization and optimization of
R&D and production resources -
Kyocera Group Major Aim
Enhance KWC Profitability
Enhance R&D System
Standardize leading-edge
mobile phone technologies
in Japan
Introduce Kyocera system and reform existing system
Production Control System
• Dispatch Kyocera (Japan)
engineers to KWC
→ Strengthen production
efficiency and improve direct
first run rate
Cost Reduction
Establish low -cost
production base in Mexico
Quality Control System
• Strengthen quality control
system through cooperation
of Kyocera (Japan) and KWC
With respect to forecasts and targets, please refer to the accompanying note on page 1.
Profit Control System
• Introduce Kyocera Management
Control System
→ Management control by model
• Introduce Kyocera’s Amoeba
Management System
10
CDMA Handsets: Product Development Strategy
2H FY04
1H FY04
Kyocera
Corp.
(Japan)
[A5305K]
1x High-End
Swiv el-sty le
Kyocera
Wireless
Corp. (KWC)
<U.S.>
[A1401K]
1x Practical
[W01K]
EV-DO Card
PCMCIA Ty pe
[M2]
[7135]
[Blade] [Phantom] [Rav e] [Slider]
Smart phone Module
Kyocera Zhenhua
Communication
Equipment Co., Ltd.
(KZC) <China>
[KZ-820]
1x
BREW
Other
[KZ850]
Camera
GPS
[W11K]
EV-DO
Au Design
Model
[A5502K]
1x High-End
1M Pixel Camera
Swiv el-sty le
Push To Talk
[KZ860]
VGA
Camera
Slim Design
[KZ830]
GPS
High-end
[KZ870]
VGA Camera
Organic EL Display
Bolster software development in India and establish an R&D Center in North America
Key Strategies
¾Im plement product strategy by segment
¾Optim ize R&D and production processes
¾Develop highly com petitive products
Business Opportunities
Kyocera： Introduce new terminal for EV-DO serv ice by KDDI
Introduce 1x high-end models: A5502K, etc
KWC： Timely provision of products based on market demand
Release PTT (Push To Talk) capable handsets
KZC： Expand sales at end-of-year and Chinese new year
Introduce new models （KZ860/870）
This roadmap is subject to change.
With respect to forecasts and targets, please refer to the accompanying note on page 1.
11
A5502K: Advanced 3rd generation CDMA 1x
mobile handset
• 2.4 inch QVGA LCD
Industry top-of-class
• Supports EZ Navi Walk
Achieves real-time nav igation
(Electronic compass with “heading up” function)
• Equipped with Xenon flash
4 times more light intensity
than conv entional LED types
• Incorporates both 1.1-megapixel CCD and 110-thousand
pixel CMOS camera functions in a swivel-style handset
• Compatible with WAP2.0/BREW2.1
• Includes QR Code (2nd generation bar code) Reader
• Continuous talk time: Approx. 130 minutes (planned)
• Continuous stand-by time: Approx. 190 hours (planned)
With respect to the information on this page, please refer to the accompanying note on page 1.
12
Digital Cameras: Product Development Strategy
1H FY04
CY 2003
4
5
6
7
2H FY04
8
9
10
11
12 ‘04/1
2
3
Finecam S5R
Finecam L4v
Standard
Type
Finecam L4
Additional 4
models in 2H
Finecam L3v
Finecam L3
Finecam L30
Flat Type
Finecam SL300R
Increase R&D staff/Consider strategic alliances
Key Strategy
Product Differentiation through Core Technology
Key device: New image engine “
”
• Improved response rate
• Decrease noise for sharper image
Business Opportunity
New Concept in Digital Camera Market
Quick response, high resolution
features of still camera and
simple and convenient features of DSC
This roadmap is subject to change.
With respect to the information on this page, please refer to the accompanying note on page 1.
13
KYOCERA Finecam S5R
•
Equipped with new image engine “
Effective sensor resolution: 5-megapixel
•
Optical zoom: 3 x, Digital zoom: 3.7 x
•
Continuous AF
•
”
(Continuous auto focus)
•
Shutter lag time: 0.07 sec.
•
Continuous shots: Approx. 3 frames/sec.
(Can capture images continuously until memory full)
•
Dimensions: (width) 92mm x (height) 57.5mm x
(depth) 33mm (excluding protruding piece)
•
Weight: Approx. 180g (excluding battery,
recording media)
14
KYOCERA Finecam SL300R
•
Equipped with new image engine “
”
•
•
Effective sensor resolution: 3.17-megapixel
Optical zoom: 3 x, Digital zoom: 2 x
•
Start-up: Less than 1 sec.
•
Shutter lag time: 0.07 sec.
•
Continuous shots: Approx. 3.5 frames/sec.
(Can capture images continuously until memory full)
Co. A: 3.3 frames/sec. (Up to 5 shots)
Co. B: 3.0 frames/sec. (Up to 4 shots)
•
Dimensions: (width) 100mm x (height) 62.5mm x
(depth) 15mm
(excluding protruding piece)
•
Weight: Approx. 125g
(excluding battery, recording media)
15
Kyocera Corporation