02 18-13 panasonic results-q3-2
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  • 1. Fiscal 2013 Third Quarter and Nine-month Financial Results February 1, 2013 Panasonic Corporation Hideaki Kawai Notes: 1. This is an English translation from the original presentation in Japanese. 2. In this presentation, “fiscal 2013” or “FY13” refers to the year ending March 31, 2013. In addition, “fiscal 2013 nine-month” or “FY13 9M” refers to the period from April to December 2012. Copyright (C) 2013 Panasonic Corporation All Rights Reserved.  This presentation contains consolidated financial results for the third quarter and the nine months ended December 31, 2012, of the current fiscal year ending March 31, 2013.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 1
  • 2. Summary of 3rd Quarter Results FY13 (Oct. to Dec.) 2 1. Overall sales declined as a result of weak sales in digital consumer products. 2. Operating profit improved due mainly to fixed cost reductions. 3. Pre-tax income and net income attributable to Panasonic Corporation returned to the black due mainly to a decrease in business restructuring expenses. Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • The three main points are as shown here, based on the third quarter results. • Firstly, overall sales declined as a result of weak sales in digital consumer products. • Secondly, while sales declined significantly, the Company secured operating profit due mainly to fixed cost reductions in this fiscal year. • Lastly, pre-tax income and net income attributable to Panasonic Corporation returned to the black due mainly to a decrease in business restructuring expenses.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 2
  • 3. Contents 3 1. Summary of the third quarter and nine months financial results 2. Segment analysis 3. Full year forecasts for fiscal 2013 Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • This section outlines the consolidated financial results for the third quarter and the nine months of fiscal 2013.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 3
  • 4. FY13 3rd Quarter Results (Oct. to Dec.) 4 (yen: billions) FY13 3Q FY12 3Q vs. FY12/ (Oct. to Dec.) (Oct. to Dec.) difference Domestic 917.2 1,043.8 -12% Overseas 884.3 916.4 -3% (-7%) * -8% (-10%) * Sales 1,801.5 1,960.2 -158.7 Operating profit 34.6 -8.1 - +42.7 / loss (1.9%) (-0.4%) Pre-tax income 9.3 -191.2 - +200.5 / loss (0.5%) (-9.8%) Net income 61.4 -197.6 - +259.0 / loss** (3.4%) (-10.1%) * Real terms excluding the effects of exchange rates (unreviewed) ** Net income / loss attributable to Panasonic Corporation Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • This slide shows the consolidated financial results for the third quarter (October to December 2012). • Consolidated sales totaled 1,801.5 billion yen, down by 8% compared with the previous year as a result of sluggish sales in digital consumer products. • On the other hand, operating profit improved by 42.7 billion yen compared to last year, totaling 34.6 billion yen, due mainly to fixed cost reductions. Both pre-tax income and net income attributable to Panasonic Corporation improved due mainly to the reduction in business restructuring expenses.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 4
  • 5. FY13 Nine Months Results (Apr. to Dec.) 5 (yen: billions) FY13 9M FY12 9M vs. FY12 (Apr. to Dec.) (Apr. to Dec.) /difference Domestic 2,795.4 3,080.2 -9% Overseas 2,644.3 2,885.2 -8% (-7%) * -9% (-8%) * Sales 5,439.7 5,965.4 -525.7 Operating profit 122.0 39.5 +208% +82.5 / loss (2.2%) (0.7%) Pre-tax income -269.4 -350.5 - +81.1 / loss (-5.0%) (-5.9%) Net income -623.8 -333.8 - -290.0 / loss** (-11.5%) (-5.6%) * Real terms excluding the effects of exchange rates (unreviewed) ** Net income / loss attributable to Panasonic Corporation Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • This slide shows the consolidated financial results for the nine months (April to December 2012). • Pre-tax loss and net loss attributable to Panasonic Corporation were recorded as a result of business restructuring expenses and an increase in valuation allowances to deferred tax assets which were posted in the second quarter. However, cumulative losses were lower than the first half as positive pre-tax income and net income attributable to Panasonic Corporation were recorded in the third quarter.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 5
  • 6. FY13 3Q Sales Analysis by Products (vs. FY12 3Q) 6 (3Q=Oct. to Dec.) (yen: billions) 【Exchange rates】 Digital consumer products Automotive FY12 3Q FY13 3Q systems US dollar 77 yen 81yen BD automotive- recorders Euro 104 yen 105yen use Consumer-use Flat- batteries panel lithium-ion batteries TVs DSCs Solar photovoltaic Mobile system phones System equipment 1,960.2 Others 34.4 Exchange rate effects Sales decreases in real terms excluding the effects of exchange rates 1,801.5 -193.1 (-10%) 1,767.1 FY2012 FY2013 3Q -158.7 (-8%) 3Q Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • Third quarter sales decreased by 158.7 billion yen compared with the previous year. In real terms, sales decreased by 193.1 billion yen, excluding the exchange rate effects of 34.4 billion yen. • By product, favorable sales continued to be recorded from the second quarter in automotive systems such as car audios and automotive-use batteries. However, weak sales in digital consumer products such as flat-panel TVs, BD recorders and DSCs contributed significantly to the overall sales decline.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 6
  • 7. FY13 3Q Global Sales by Region 7 (3Q=Oct. to Dec.) (yen: billions) vs. FY12 Sales proportion by Sales Local region Yen basis currency (vs. FY12) basis Japan 917.2 -12% - 51% (-2%) Americas 270.7 +4% ±0% 15% Europe 179.2 -11% -12% 10% 49% (+2%) Asia 215.7 +1% -4% 12% China 218.7 -10% -14% 12% Total 1,801.5 -8% -10% 100% Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • Next, global sales by region. • Sales in Japan were down due to weak sales in AV products. • In the Americas, sales in automotive-related business continued to be favorable. • In Europe, sales in AV products and solar photovoltaic systems were weak. • In Asia, despite weak sales in AV products, sales in appliances and automotive-related business increased. • Finally, the boycotting of Japanese products caused sales declines mainly in appliances in China.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 7
  • 8. FY13 3Q Operating Profit Analysis (vs. FY12 3Q) 8 (3Q=Oct. to Dec.) Streamlining/ Exchange (yen: billions) (%: vs. sales) price declines rate effects 34.6 35.7 3.0 (1.9%) Fixed cost reduction 67.0 -8.1 (-0.4%) Sales decrease (real terms) -63.0 FY2012 FY2013 3Q +42.7(+2.3%) 3Q Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • This chart shows the operating profit analysis compared with the previous year. • Profitability worsened by 63.0 billion yen due to sales declines. However, fixed cost reductions during this fiscal year and last fiscal year’s business restructuring improved profitability by 67.0 billion yen in total. Streamlining in material costs which exceeded price declines also improved profitability by 35.7 billion yen. • Weakening foreign exchange rates against the dollar and the Euro also improved profitability by 3.0 billion yen. As a result, operating profit increased by 42.7 billion yen.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 8
  • 9. FY13 3Q Pre-tax and Net Income Analysis 9 (3Q=Oct. to Dec.) (yen: billions) FY13 3Q vs. FY12 3Q Operating profit 34.6 +42.7 Financial income / loss -3.1 -1.0 Early retirement charges * -8.6 +29.1 Other * -13.6 +129.7 Non-operating income / loss -25.3 +157.8 Pre-tax income / loss 9.3 +200.5 Provision for income taxes -42.8 -63.8 Equity in earnings of associated companies 2.0 +0.7 Net income / loss 54.1 +265.0 Less net income / loss attributable to -7.3 +6.0 noncontrolling interests Net income attributable to Panasonic 61.4 +259.0 Corporation * Total business restructuring expenses which are included in ‘Early retirement charges’ and ‘Other’: -32.9 billion yen Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • Next, pre-tax and net income analysis. • Although operating profit was 34.6 billion yen, pre-tax income totaled 9.3 billion yen due mainly to business restructuring and disposals of investments. This result was also an improvement of 200.5 billion yen compared with the previous year as a result of a significant decline in business restructuring expenses. • Furthermore, the Company reviewed deferred tax assets due to business consolidation in its subsidiary companies in Japan. As a result, net income attributable to Panasonic Corporation totaled 61.4 billion yen.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 9
  • 10. Contents 10 1. Summary of the third quarter and nine months financial results 2. Segment analysis 3. Full year forecasts for fiscal 2013 Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • Next, segment analysis based on the third quarter results.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 10
  • 11. FY13 Financial Results by Segment 11 (yen: billions) FY13 3Q (Oct. to Dec.) FY13 9M (Apr. to Dec.) Operating Operating Sales profit/loss Sales profit/loss vs. FY12 vs. FY12 vs. FY12 vs. FY12 AVC Networks 388.9 -20% 1.7 +26.5 1,078.9 -23% 21.6 +62.1 Appliances 383.1 -1% 19.3 -4.3 1,197.1 +1% 70.3 -6.1 Systems & 152.5 -22% -4.0 -8.3 509.8 -15% -14.0 -11.7 Communications Eco Solutions 399.8 +1% 24.1 +5.0 1,140.1 ±0% 42.7 +4.2 Automotive Systems 189.0 +12% 3.2 +0.7 571.7 +28% 11.9 +8.7 Industrial Devices 336.6 +1% 0.0 +13.1 1,030.2 -5% 17.9 +31.6 Energy 142.3 -8% 3.6 +10.5 434.8 -6% 6.4 +23.1 Other 314.6 -25% 1.9 +0.9 1,012.9 -28% 11.3 -4.4 Subtotal 2,306.8 -9% 49.8 +44.1 6,975.5 -10% 168.1 +107.5 Corporate and -505.3 - -15.2 -1.4 -1,535.8 - -46.1 -25.0 eliminations Consolidated Total 1,801.5 -8% 34.6 +42.7 5,439.7 -9% 122.0 +82.5 Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • Sales in the Automotive Systems segment increased while sales in AVC Networks and Systems & Communications decreased significantly. • Operating profits in AVC Networks, Industrial Devices and Energy improved due to fixed cost reductions and streamlining. However, profitability in Systems & Communications and Appliances decreased. • Next, analysis by segment.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 11
  • 12. AVC Networks 12 Operating profit increased due mainly to profit improvement in flat-panel TVs. flat- 3Q (Oct. to Dec.) 9M (Apr. to Dec.) (yen: billions) (yen: billions) 1,402.1 (-23%) Sales 488.5 (-20%) 1,078.9 388.9 21.6 1.7 (2.0%) (0.4%) OP -24.8 -40.5 (%) (-5.1%) (-2.9%) FY12 FY13 FY12 FY13 Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • First, AVC Networks. While demand for digital AV products weakened considerably mainly in developed countries, sales in flat- panel TVs, BD recorders and digital cameras decreased significantly. As a result, overall sales decreased by 20% compared with a year ago. • On the other hand, operating profit improved by 26.5 billion yen while a sharp sales decline was recorded. This result was due to reductions of non-profitable product models in flat-panel TVs and restructuring benefits.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 12
  • 13. TV / Panel Business (9M) 13 (9M=Apr. to Dec.) (yen: billions) Profitability is improving as planned. Sales Operating profit (vs.FY12) FY13 Large-sized TVs 17.0 9M OP expansion 577.7 1.0 11.0 Others 427.4 45.0 Non-TV panels expansion Cost structure improvement Approx. 90.0 bil. yen FY12 49.0 improvement 9M OP FY12 9M FY13 9M Restructuring benefits <TV sets + TV panels Price decline External sales in units> -33.0 14.72M 10.75M Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • In the TV and panel business, structural changes (reducing the number of non-profitable product models in the set business, further outsourcing LCD panels and non-TV applications for panel business) are making progress. As a result, profitability is steadily improving amid weaker sales. • Operating profit improved by 90.0 billion yen in the nine months and this is in line with the Company’s plan towards full year improvement of 110.0 billion yen.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 13
  • 14. Appliances 14 Operating profit declined due to weaker sales in Japan and China. 3Q (Oct. to Dec.) 9M (Apr. to Dec.) (yen: billions) (yen: billions) (+1%) (-1%) 1,187.4 1,197.1 Sales 386.3 383.1 76.4 OP 23.6 (6.4%) 70.3 (%) (6.1%) 19.3 (5.9%) (5.0%) FY12 FY13 FY12 FY13 Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • Although sales in Japan (the main market) and in China (where there is boycotting of Japanese products) were weak, overall sales were almost at the same level as the previous year. This was due to sales increases in the strategic region, Asia. • Operating profit was lower than the previous year due to weak sales in Japan and China, in particular in air conditioners.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 14
  • 15. Systems & Communications 15 Operating loss was recorded due to sluggish sales in system-related equipment and mobile phones. system- 3Q (Oct. to Dec.) 9M (Apr. to Dec.) (yen: billions) (yen: billions) 599.9 (-15%) 194.7 509.8 Sales (-22%) 152.5 OP 4.3 -2.3 (%) (2.2%) (-0.4%) -4.0 (-2.7%) -14.0 (-2.8%) FY12 FY13 FY12 FY13 Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • Although sales increased in the growing business of security cameras, overall sales decreased by 22% compared with a year ago. This was due mainly to sales decreases in mobile phones, compact multifunction printers and private branch exchange (PBX) products. • Operating loss amounted to 4.0 billion yen due mainly to a sharp sales decline despite the Company’s fixed-cost reduction efforts including in the mobile phone business. Compared with the previous year, this was a decrease of 8.3 billion yen.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 15
  • 16. Eco Solutions 16 Operating profit increased due mainly to sales increase in lighting business. 3Q (Oct. to Dec.) 9M (Apr. to Dec.) (yen: billions) (yen: billions) (±0%) (+1%) 1,136.6 1,140.1 Sales 394.0 399.8 24.1 38.5 42.7 OP 19.1 (6.0%) (3.4%) (3.7%) (%) (4.8%) FY12 FY13 FY12 FY13 Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • Although sales in solar photovoltaic systems were lower, overall sales increased by 1% compared with a year ago. This result was due to sales increases in the lighting business including LEDs and the energy system business such as wiring devices. • Operating profit increased by 5.0 billion yen compared with a year ago as a result of sales increases and profits recovery through implementation of streamlining. • Operating profit in the third quarter increased to 6% and this segment is now one of the Company’s profit pillars along with Appliances.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 16
  • 17. Automotive Systems 17 Operating profit improved due to sales increases in North American and Asian regions. 3Q (Oct. to Dec.) 9M (Apr. to Dec.) (yen: billions) (yen: billions) (+28%) (+12%) 571.7 189.0 446.8 Sales 169.2 11.9 (2.1%) OP 2.5 3.2 (1.7%) 3.2 (%) (1.5%) (0.7%) FY12 FY13 FY12 FY13 Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • Sales increased by 12% on last year due mainly to favorable sales in North America and Asia where automobile sales are strong. • Operating profit also improved by 0.7 billion yen compared with a year ago, benefitting from sales increases. However, increases in product development costs put a cap of 1.7% on the operating profit ratio to sales. • In this business, product development for the mid to long term is the key along with car evolution. Looking forward, through collaboration with car manufacturers globally, the Company endeavors to develop new businesses such as EV-related and cockpits as well as existing businesses.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 17
  • 18. Industrial Devices 18 Operating profit increased due mainly to sales increase and profit improvement in semiconductor business. 3Q (Oct. to Dec.) 9M (Apr. to Dec.) (yen: billions) (yen: billions) (-5%) 1,085.5 1,030.2 (+1%) Sales 333.8 336.6 17.9 (1.7%) 0.0 (0.0%) -13.7 OP -13.1 (-1.3%) (%) (-3.9%) FY12 FY13 FY12 FY13 Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • Although sales in semiconductors and optical pick-ups were down, overall sales were up by 1% compared with a year ago. This was due to sales increases in automation controls for smartphones and LCD panels for tablets. • Operating profit improved by 13.1 billion yen compared with a year ago due mainly to sales increases and profit improvement in semiconductor business.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 18
  • 19. Semiconductor Business (9M) 19 (9M=Apr. to Dec.) (yen: billions) Profitability improved due mainly to restructuring benefits. Sales Operating profit (vs. FY12) System-LSI cost reduction FY13 3.0 9M OP 118.9 7.0 107.0 Marginal 13.0 profit Approx. improvement 21.0 bil. yen improvement FY12 Fixed cost reduction etc. 9M OP Sales 16.0 decrease FY12 FY13 & Restructuring benefits 9M 9M Price decline -18.0 Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • This slides shows profit improvement in the semiconductor business. • Operating loss continues to be recorded as production by assembly manufacturers of mainly AV products remains weak. However, profitability in the nine months improved by 21.0 billion yen due mainly to business restructuring benefits. • Demand for AV products is much weaker and the rate of improvement in profitability is lower than the Company’s original expectation.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 19
  • 20. Energy 20 Profitability improved due mainly to the effects of streamlining in consumer-use lithium-ion battery business. consumer- lithium- 3Q (Oct. to Dec.) 9M (Apr. to Dec.) (yen: billions) (yen: billions) (-6%) 461.8 434.8 (-8%) Sales 154.1 142.3 6.4 3.6 (1.5%) (2.6%) OP -6.9 (%) (-4.5%) -16.7 (-3.6%) FY12 FY13 FY12 FY13 Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • Sales decreased by 8% compared with a year ago. Despite a sales increase in automotive-use batteries on the back of market expansion in eco-cars, this result was due mainly to sales decreases in consumer-use lithium-ion batteries and solar photovoltaic systems. • Operating profit improved by 10.5 billion yen compared with a year ago due to business restructuring benefits. Streamlining effects in the consumer-use lithium-ion battery business such as expanding production in China also contributed to improvement in profitability.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 20
  • 21. Other 21 Overall operating profit increased due to profitability improvement in SANYO business. 3Q (Oct. to Dec.) 9M (Apr. to Dec.) (yen: billions) (yen: billions) 1,403.5 (-28%) Sales 418.2 1,012.9 (-25%) 314.6 15.7 (1.1%) 11.3 (1.1%) OP 1.0 1.9 (%) (0.2%) (0.6%) FY12 FY13 FY12 FY13 Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • Sales decreased by 25% compared with a year ago. However, this decline was due to SANYO-related business transfers implemented in fiscal 2012. • Operating profit increased from a year ago due mainly to profitability improvement in the SANYO business.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 21
  • 22. Healthcare and MS Companies 22 (yen: billions) 3Q (Oct. to Dec.) 9M (Apr. to Dec.) vs. FY12/ vs. FY12/ FY13 FY13 difference difference Sales 33.4 +4% 98.7 ±0% Healthcare Company Operating profit 2.0 - 0.1 5.9 + 0.8 Sales 27.2 -16% 109.3 -13% MS Company* Operating profit 1.2 - 1.9 12.5 -5.1 *Manufacturing Solutions Company Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • This slide shows the results of two companies in the Other segment. • In the Healthcare Company, despite sales increases, operating profit remained unchanged due mainly to increased fixed costs in blood glucose monitoring systems. • In the Manufacturing Solutions Company, both sales and operating profit were lower than last year mainly as a result of Chinese companies holding back investment.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 22
  • 23. Contents 23 1. Summary of the third quarter and nine months financial results 2. Segment analysis 3. Full year forecasts for fiscal 2013 Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • Finally, full year forecasts for fiscal 2013.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 23
  • 24. FY2013 Full Year Forecasts 24 Unchanged from the previous forecasts (Oct. 2012). (yen: billions) FY13 FY12 vs. FY12 forecasts results Sales 7,300.0 7,846.2 -546.2 Operating 140.0 43.7 +96.3 profit (1.9%) (0.6%) Pre-tax -365.0 -812.8 +447.8 income / loss (-5.0%) (-10.4%) Net -765.0 -772.2 +7.2 income / loss* (-10.5%) (-9.8%) * Net income / loss attributable to Panasonic Corporation Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • The business performance forecasts for fiscal 2013 remain unchanged from the previous forecasts announced on October 2012.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 24
  • 25. Generating Cash 25 End of FY12 End of 2Q End of 3Q End of FY13 (yen: billions) -770.0 Net cash -975.7 -962.0 -1,087.7 <Progress of Cash Flow Management Performance Project> Targets Forecasts CAPEX reduction 20.0 20.0 Asset disposal & securitization 110.0 130.0 Inventory reduction 40.0 30.0 Working capital reduction 30.0 20.0 Total 200.0 200.0 Making steady improvement in net cash towards mid-term plan. mid- Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • Finally, generating cash. • The ‘Cash Flow Management Performance Project’ which started in the second quarter is making a steady improvement. • The Company will generate 20.0 billion yen from the original plan by reducing capital expenditure, and 130.0 billion yen by disposing of investments and assets, as well as securitization. In addition, through reductions in inventory and working capital, the Company plans to generate a total of 200.0 billion yen as targeted. • It aims to make a steady improvement of net cash position toward the next mid-term plan which starts in April 2013.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 25
  • 26. 26 Copyright (C) 2013 Panasonic Corporation All Rights Reserved. • Although the business environment changes rapidly, the Company endeavors to implement speedy measures. • It will announce the next mid-term plan at the end of March 2013. • Thank you very much for your continued support.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 26
  • 27. Disclaimer Regarding Forward-Looking Statements This presentation includes forward-looking statements (within the meaning of Section 27A of the U.S. Securities Act of 1933 and Section 21E of the U.S. Securities Exchange Act of 1934) about Panasonic and its Group companies (the Panasonic 27 Group). To the extent that statements in this presentation do not relate to historical or current facts, they constitute forward- looking statements. These forward-looking statements are based on the current assumptions and beliefs of the Panasonic Group in light of the information currently available to it, and involve known and unknown risks, uncertainties and other factors. Such risks, uncertainties and other factors may cause the Panasonic Groups 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. Panasonic undertakes no obligation to publicly update any forward-looking statements after the date of this presentation. Investors are advised to consult any further disclosures by Panasonic in its subsequent filings with the U.S. Securities and Exchange Commission pursuant to the U.S. Securities Exchange Act of 1934 and its other filings. The risks, uncertainties and other factors referred to above include, but are not limited to, economic conditions, particularly consumer spending and corporate capital expenditures in the United States, Europe, Japan, China, and other Asian countries; volatility in demand for electronic equipment and components from business and industrial customers, as well as consumers in many product and geographical markets; currency rate fluctuations, notably between the yen, the U.S. dollar, the euro, the Chinese yuan, Asian currencies and other currencies in which the Panasonic Group operates businesses, or in which assets and liabilities of the Panasonic Group are denominated; the possibility of the Panasonic Group incurring additional costs of raising funds, because of changes in the fund raising environment; the ability of the Panasonic Group to respond to rapid technological changes and changing consumer preferences with timely and cost-effective introductions of new products in markets that are highly competitive in terms of both price and technology; the possibility of not achieving expected results on the alliances or mergers and acquisitions including the business reorganization after the acquisition of all shares of Panasonic Electric Works Co., Ltd. and SANYO Electric Co., Ltd.; the ability of the Panasonic Group to achieve its business objectives through joint ventures and other collaborative agreements with other companies; the ability of the Panasonic Group to maintain competitive strength in many product and geographical areas; the possibility of incurring expenses resulting from any defects in products or services of the Panasonic Group; the possibility that the Panasonic Group may face intellectual property infringement claims by third parties; current and potential, direct and indirect restrictions imposed by other countries over trade, manufacturing, labor and operations; fluctuations in market prices of securities and other assets in which the Panasonic Group has holdings or changes in valuation of long-lived assets, including property, plant and equipment and goodwill, deferred tax assets and uncertain tax positions; future changes or revisions to accounting policies or accounting rules; as well as natural disasters including earthquakes, prevalence of infectious diseases throughout the world, disruption of supply chain and other events that may negatively impact business activities of the Panasonic Group. The factors listed above are not all-inclusive and further information is contained in Panasonics latest annual reports, Form 20-F, and any other reports and documents which are on file with the U.S. Securities and Exchange Commission. In order to be consistent with generally accepted financial reporting practices in Japan, operating profit (loss) is presented in accordance with generally accepted accounting principles in Japan. The company believes that this is useful to investors in comparing the companys financial results with those of other Japanese companies. Under United States generally accepted accounting principles, expenses associated with the implementation of early retirement programs at certain domestic and overseas companies, and impairment losses on long-lived assets are usually included as part of operating profit (loss) in the statement of income. Copyright (C) 2013 Panasonic Corporation All Rights Reserved.Copyright (C) 2013 Panasonic Corporation All Rights Reserved. 27