Tokyo, April 30, 2014
Fujitsu today reported consolidated net income of 48.6 billion yen (US$472 million), representing an improvement of 128.5 billion yen from fiscal 2012.
Consolidated net sales for fiscal 2013 were 4,762.4 billion yen (US$46,237 million), up 8.7% from fiscal 2012. Sales in Japan rose by 2.7%. Sales of system integration services increased, primarily to the public sector and financial services sector, and there were also higher sales of network products and PCs. Outside of Japan, sales rose by 20.2%, up by 1% on a constant-currency basis.
Gross profit was 1,269.1 billion yen, up 65.4 billion yen from fiscal 2012. Despite the decline in mobile phone sales, gross profit increased due to the impact of foreign exchange fluctuations and the beneficial effects of initiatives to improve profitability. Selling, general and administrative expenses were 1,126.6 billion yen, an increase of 11.1 billion yen from fiscal 2012, mainly attributable to the weaker yen.
As a result, Fujitsu recorded an operating income of 142.5 billion yen (US $1,383 million), an increase of 54.2 billion yen from the previous fiscal year. Structural reforms in the LSI device business and businesses outside of Japan contributed approximately 30.0 billion yen to this increase, and the impact of workforce-related measures contributed approximately 20.0 billion yen.
"Throughout fiscal 2013, we saw a strong recovery in IT spending in Japan. We achieved significant improvements in profits by taking measures to deal with issues in the LSI device business and businesses outside Japan, as well as by taking workforce-related measures and initiatives to reduce corporate expenses. I'm happy to announce, as a result, that we were able to achieve the initial financial targets we set at the beginning of the year," commented Fujitsu's President Masami Yamamoto. "Fiscal 2014 will be the milestone year to achieve our medium term targets. We will be shifting resources for strategic investment in order to achieve mid- and long-term growth."
Business Segment Results
Consolidated net sales in the Technology Solutions segment amounted to 3,243.0 billion yen (US$31,485 million), an increase of 10.2% from fiscal 2012. Sales in Japan increased 6.1%. In system integration services, sales increased, primarily in the public sector and financial services sector, as customers increased investment spending. In network products, overall sales increased as a result of spending by telecommunications carriers to increase LTE service area coverage and boost transmission speeds. Server-related sales increased due to large-scale systems deals in the public sector. In infrastructure services, sales of outsourcing services remained steady. Sales outside Japan increased 18.2% but were essentially unchanged on a constant-currency basis. The segment posted operating income of 209.1 billion yen (US$2,030 million), up 35.1 billion yen compared to fiscal 2012. In Japan, the increase was mainly owing to higher sales of system integration services and network products, in addition to the effect of workforce-related measures. Outside Japan, operating income benefited from structural reforms and lower amortization expenses for goodwill, as well as from higher sales of network products.
Consolidated net sales in the Ubiquitous Solutions segment were 1,125.4 billion yen (US$10,926 million), up 3.2% from fiscal 2012. Sales in Japan were down by 3.5%. There was a significant increase in enterprise PC sales on higher demand for upgrades in accordance with the ending of support for an operating system product. Sales outside Japan increased 23.9%. On a constant-currency basis, sales increased 7%. The segment posted an operating loss of 22.1 billion yen (US$215 million), a deterioration of 31.7 billion yen from fiscal 2012. In Japan, operating income for mobile phones was adversely impacted by the sharp decline in unit sales, as well as higher costs due to functionality enhancements and the weaker yen.
Consolidated net sales in Device Solutions amounted to 600.2 billion yen (US$582.7 million), an increase of 11.1% compared to fiscal 2012. Sales in Japan fell 1.3%. Sales of LSI devices used in mobile phones increased, but those used in digital audio-visual equipment and IT equipment decreased. Sales outside Japan rose 26.1%. On a constant-currency basis, sales increased by 5%. The segment recorded operating income of 28.3 billion yen (US$275 million), representing an improvement of 42.6 billion yen from fiscal 2012. In Japan, operating income benefited from lower overhead expenses owing to an early retirement incentive plan and other factors in the LSI device business.
Fiscal 2014 Consolidated Projections
The Fujitsu Group will switch from Japanese accounting standards and voluntarily adopt International Financial Reporting Standards (IFRS) for its consolidated financial statements beginning in fiscal 2014. The full-year financial results for fiscal 2013 and projections for fiscal 2014, in accordance with IFRS, are as presented below.
Fiscal 2013 full-year financial results and fiscal 2014 projections
| (Billion Yen) |
| |
FY2013 (Actual)
J-GAAP |
FY2013 (Actual)
IFRS |
FY 2014 Projections (Full-Year)
IFRS |
Change
IFRS |
| Net Sales |
4,762.4 |
4,762.4 |
4,800.0 |
37.5 |
| Operating Income |
142.5 |
147.2 |
185.0 |
37.7 |
| Net Income |
48.6 |
113.2 |
125.0 |
11.7 |
For fiscal 2014, the company plans to distribute total dividends of 8 yen, 4 yen each for an interim dividend and a year-end dividend.
Note: Figures for actual results in fiscal 2013 are preliminary and are subject to change based on results of accounting audits.
* Yen figures have been converted to U.S. dollars, for convenience only, at a uniform rate of US$1 = 103 yen, the approximate closing rate on March 31, 2014.
