Fujitsu Limited today announced that it has revised its unconsolidated earnings projections for fiscal 2007 ended March 31, 2008.
1. Revised Unconsolidated Earnings Projections for Full Year Fiscal 2007
(April 1, 2007 – March 31, 2008)
|Net Sales||Net Income|
|Previous Projection (A)||3,000.0||40.0|
|Current Projection (B)||2,979.0||61.4|
|Percentage Change||-0.7 %||53.5 %|
|Results for FY 2006||2,869.2||(249.2)|
2. Reasons for Revisions to Earnings Projections
The projection for net income has been increased by 21.4 billion yen from the previous projection, to 61.4 billion yen. The company recognized losses principally from the revaluation of investment securities and stocks in subsidiaries and affiliates resulting from a significant decline in share prices (*1), as well as from restructuring charges in relation to the restructuring of its LSI business (*2). However, the projection for net income has been increased due to the following factors: the positive effects of cost-cutting and cost efficiencies in the server and PC businesses; the increase in dividend income from subsidiaries in Japan and outside Japan; the reversal of a revaluation reserve for deferred tax assets of approximately 18.0 billion yen resulting from the improvement of overall business profitability.
(*1) The Company recorded a revaluation loss of 27.4 billion yen as a result of the revaluation of investment securities and stocks in subsidiaries and affiliates owned by the Company whose current market value or net worth has significantly declined and are unlikely to be recovered in the future. Please refer to today’s release “Regarding Losses on Revaluation of Investment Securities and Stocks of Subsidiaries and Affiliates” for further details.
In the previous earnings projection, the Company estimated a loss of 5.6 billion yen on revaluation of stocks in subsidiaries and affiliates, which was reported in the first half of fiscal year 2007, and a loss of 19.8 billion yen on revaluation of investment securities, which was reported in the third quarter of fiscal year 2007, principally as a result of a significant decline in the share price of Spansion Inc. of the U.S., which is listed on the NASDAQ exchange. As a result, the Company recorded a revaluation loss on stocks in subsidiaries and affiliates of 27.4 billion yen at the end of March 2008, which had expanded due to the decline in the share prices of listed affiliates.
(*2) The Company recorded losses of 22.1 billion yen as it recognized an impairment loss on certain assets and expenditures for relocation and disposal of assets in relation to the transfer of the advanced process technology development and mass-production prototyping functions which had been conducted at the Akiruno Technology Center (Akiruno TC) to the Mie plant. Please refer to today’s release “Regarding Restructuring Charges for Full Year Fiscal 2007” for further details.
In the previous earnings projection, the Company estimated approximately 10.0 billion yen in expenditures for relocation and disposal of assets conducted in the logic LSI development and prototyping. At this point land and idle facilities in the Akiruno TC were under the consideration of being availed within the Group. The Company closely investigated the expenditure for relocation and disposal of assets and also devaluated the above mentioned land and idle facilities in the Akiruno TC to their recoverable amounts since there was no current concrete plan determined for their utilization, which resulted in 9.3 billion yen of impairment loss at the end of March 2008, and as a result the Company recorded a loss on restructuring charges of 22.1 billion yen.
Reference: Revised Consolidated Earnings Projections for Full Year Fiscal 2007
(April 1, 2007 – March 31, 2008)
|Net Sales||Operating Income||Net Income|
|Previous Projection (A)||5,350.0||200.0||40.0|
|Current Projection (B)||5,330.8||204.9||48.1|
|Percentage Change||-0.4 %||2.5 %||20.3 %|
|Results for FY 2006||5,100.1||182.0||102.4|
* These materials may contain forward-looking statements that are based on management's current views and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. Actual results may differ materially from those projected or implied in the forward-looking statements due to, without limitation, the following factors:
- General economic and market conditions in key markets (particularly in Japan, North America, Europe, and Asia, including China)
- Rapid changes in the high-technology market (particularly semiconductors, PCs, etc.)
- Fluctuations in exchange rates or interest rates
- Fluctuations in capital markets
- Intensifying price competition
- Changes in market positioning due to competition in R&D
- Changes in the environment for the procurement of parts and components
- Changes in competitive relationships relating to collaborations, alliances and technical provisions
- Potential emergence of unprofitable projects
- Changes in accounting policies
Fujitsu is a leading provider of IT-based business solutions for the global marketplace. With approximately 160,000 employees supporting customers in 70 countries, Fujitsu combines a worldwide corps of systems and services experts with highly reliable computing and communications products and advanced microelectronics to deliver added value to customers. Headquartered in Tokyo, Fujitsu Limited (TSE:6702) reported consolidated revenues of 5.3 trillion yen (US$53 billion) for the fiscal year ended March 31, 2008. For more information, please see: www.fujitsu.com.
Company and product names referenced herein are trademarks or registered trademarks of their respective owners. Information provided in this press release is accurate at time of publication and is subject to change without advance notice.
Date: 12 May, 2008
Company: Fujitsu Limited, , , , ,
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