09 13-12 nec results-q1

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09 13-12 nec results-q1

  1. 1. Financial Results for Q1Fiscal Year Ending March 31, 2013 July 31, 2012 NEC Corporation (http://www.nec.com/en/global/ir)
  2. 2. Index I. Financial Results for Q1, FY13/3 II. Summary of Financial Forecasts for 1H, FY13/3  Financial Results for Q1, FY13/3 (Appendix)  Financial Forecasts for 1H, FY13/3 (Appendix)  Reference (Financial data) ※ As stated in the July 6, 2012 announcement, “NEC Revises Business Segments,” NEC has revised its business segments from the first quarter of the fiscal year ending March 31, 2013. Figures for the corresponding period of the previous fiscal year have been adjusted in accordance with the new segments Page 2 © NEC Corporation 2012
  3. 3. I. Financial Results for Q1, FY13/3
  4. 4. Q1 ResultsSummary of Financial Results for Q1▐ Sales: Decrease due to deconsolidation of consumer PC and LCD module businesses *▐ Profit: More than 10B Yen improvement in operating, ordinary and net loss year on year (Billions of Yen) *increase by approximately 1% Q1(April to June) excluding the impact of deconsolidation FY12/3 FY13/3 YoY Actual Actual Net Sales 669.1 631.5 - 5.6% Operating Loss -19.4 -7.9 11.6 Ordinary Loss -29.6 -12.2 17.5 Net Loss -29.7 -17.9 11.8 Net Loss -11.43 -6.87 4.56 per Share (Yen) Free Cash Flow 16.5 26.7 10.1 (Ref): Average exchange rate for Q1, FY13/3 1$= ¥81.25, 1€= ¥106.09 Page 4 © NEC Corporation 2012
  5. 5. Q1 ResultsQ1 Results by Segment (Billions of yen) Net Sales Operating Income/Loss Carrier -7.9 Network 667.5 669.1 631.5 Personal Solutions -19.4 11.2 237.4 -23.2 2.4 241.3 Social 0.4 1.3IT Solutions 249.2 Infrastructure 0.3 1.4 - 5.8 Carrier IT Solutions - 10.1 Network 112.3 127.5 - 12.8 - 3.0 Social 141.3 - 1.4Infrastructure 58.4 58.8 Carrier 59.2 Network - 5.5 - 1.3 Personal Solutions 193.5 183.5 Personal - 0.4 - 10.3 Solutions 132.5 - 1.7 Others - 9.5 Others Eliminations/ - 5.9 62.0 61.9 49.3 Unclassifiable expenses FY11/3 FY12/3 FY13/3 FY11/3 FY12/3 FY13/3 Q1 Q1 Q1 Q1 Q1 Q1 Page 5 © NEC Corporation 2012
  6. 6. Q1 ResultsSales Change (Year on Year) (Billions of Yen) Stable sales in social systems and Healthy demand to prepare in aerospace and defense systems advance for increasing data traffic in Japan with wide spread of smartphones Social Infrastructure Deconsolidation of consumer PC +0.5 (+0.8%) business and decrease in shipment Carrier Network of mobile terminals +13.9 (+10.9%) FY12/3 Q1 Personal Solutions <Apr-Jun> -51.1 (-27.8%) 669.1 Deconsolidation of LCD module business and decline in electronic component business IT Solutions +11.8 (+5.0%) Others FY13/3 Q1 -12.6 <Apr-Jun> Increase in IT Services and Platform 631.5 Page 6 © NEC Corporation 2012
  7. 7. Q1 ResultsOperating Income/Loss Change (Year on Year) (Billions of Yen) Enhancement of cost reductions Sales decrease in mobile terminals FY12/3 Q1 Personal Solutions FY13/3 Q1 <Apr-Jun> Social Infrastructure -4.3 <Apr-Jun> +1.0 -19.4 -7.9 Sales decrease Others -0.1 Eliminations/ Carrier Network Unclassifiable +8.8 expenses -0.9 Sales increase IT Solutions +7.0 Sales increase, cost reductions Page 7 © NEC Corporation 2012
  8. 8. Q1 ResultsKey Points of Q1 Results by Segment (Year on Year)  Increase due to solid sales in IT services and Platform IT Solutions  Improvement by sales increase and cost reductions  Increase due to healthy demand to prepare in advance for increasing data traffic in Carrier Japan with wide spread of smartphones Network  Higher profits from sales increase Social  Stable sales in social systems and aerospace and defense systems Infrastructure  Increase by enhancing cost reductions while sales was almost flat as previous year  Decline due to deconsolidation of consumer PC business and decrease in shipment Personal of mobile terminals Solutions  Decrease due to sales decrease in mobile terminals  Decrease due to deconsolidation of LCD module business and decline in electronic Others component business  Almost same level year on year by cost reductions despite sales decrease Note: First bullets refer to changes in sales, second bullets refer to changes in operating income/loss Page 8 © NEC Corporation 2012
  9. 9. Q1 ResultsIT Solutions Business Billions of Yen (YoY) (Billions of Yen) YoY ▐ Sales 249.2 (+5.0%) +5.0% Sales -1.6% IT Services 249.2 Solid sales in telecom, 241.3 237.4 manufacturing and retail sectors +5.3% Platform -2.3% - 2.3% Increase mainly in hardware andIT Services 161.2 165.9 157.5 - 4.2% enterprise network due to - 5.4% large-scale projects Operating margin ratio Operating +4.3% ▐ Operating Loss -5.8 (+7.0) -0.2% Loss Platform 80.0 79.9 83.3 Improve by sales increase and cost -10.1 -12.8 -5.8 reductions FY11/3 FY12/3 FY13/3 Q1 Q1 Q1 Page 9 © NEC Corporation 2012
  10. 10. Q1 ResultsCarrier Network Business Billions of Yen (YoY) (Billions of Yen) YoY ▐ Sales 141.3 (+10.9%) Sales Solid sales in Japan due to healthy demand to prepare in advance for 141.3 increasing data traffic in Japan 127.5 7.9% with wide spread of smartphones +10.9% 112.3 +13.5% 1.9% ▐ Operating Income 11.2 (+8.8) Operating margin ratio - 4.9% Improve due to sales increase in Japan 11.2 Operating Income/Loss -5.5 2.4 FY11/3 FY12/3 FY13/3 Q1 Q1 Q1 Page 10 © NEC Corporation 2012
  11. 11. Q1 ResultsSocial Infrastructure Business Billions of Yen (YoY) (Billions of Yen) YoY ▐ Sales 59.2 (+0.8%) Sales Stable sales in social systems and aerospace and defense systems 58.4 58.8 59.2 +0.8% +0.7% 2.4% ▐ Operating Income 1.4 (+1.0) Operating margin ratio Increase by enhancing cost 0.6% 0.7% reductions while sales was almost flat as previous year Operating Income 1.4 0.3 0.4 FY11/3 FY12/3 FY13/3 Q1 Q1 Q1 Page 11 © NEC Corporation 2012
  12. 12. Q1 ResultsPersonal Solutions Business Billions of Yen (YoY) (Billions of Yen) YoY ▐ Sales 132.5 (-27.8%) Sales Mobile Terminals : -5.2% Decline due to decrease in 193.5 shipment of mobile terminals 183.5 Approximately -10% PCs and Others : excluding the impact -27.8% of the deconsolidation +0.5% Mobile 79.1 132.5 Decline due to deconsolidation Terminals 79.5 Operating Margin Ratio of consumer PC business -27.8% 0.7% - 0.2% 57.4 - 2.2% -9.1% ▐ Operating Loss -3.0 (-4.3) Approximately +10% 114.4 -27.8% PCs and Operating 104.0 excluding the impact of the deconsolidation Decrease due to sales decrease in Income/Loss 75.1 Others mobile terminals -0.4 1.3 -3.0 FY11/3 FY12/3 FY13/3 Q1 Q1 Q1 Page 12 © NEC Corporation 2012
  13. 13. Q1 ResultsNet Income/Loss Change (Year on Year) (Billions of Yen) FY12/3 Q1 FY13/3 Q1 <Apr-Jun> Equity in income/loss <Apr-Jun> of affiliates +5.5 -29.7 -17.9 Improvement in non-operating income/loss +5.9 Others Improvement in -5.6 operating income +11.6 Income taxes -5.9 Carrier Network +8.8 IT Solutions +7.0 Personal Solutions -4.3 Page 13 © NEC Corporation 2012
  14. 14. ll. Summary of Financial Forecasts for 1H, FY13/3
  15. 15. NEC’s Management Policy▐ Immediate improvement of macro economy and market environment cannot be expected▐ We will shift to conduct efficient business operations to generate constant profit based on current sales level  Execute management reforms to revive the NEC Group  Focus investment in the key business areas to establish firm foundation toward growth “CS No.1” “Global First” “One NEC” Page 15 © NEC Corporation 2012
  16. 16. 1H ForecastsSummary of Financial Forecasts for 1H (Billions of Yen) 1H(April to September) Full Year FY12/3 FY13/3 FY12/3 FY13/3 YoY YoY Actual Forecasts Actual Forecasts Net Sales 1,443.2 1,400.0 - 3.0% 3,036.8 3,150.0 3.7% Operating Income 6.8 1.0 -5.8 73.7 100.0 26.3 % to Net Sales 0.5% 0.1% 2.4% 3.2% Ordinary Income/Loss -10.4 -16.0 -5.6 42.1 70.0 28.0 % to Net Sales - - 1.4% 2.2% Net Income/Loss -11.0 -24.0 -13.0 -110.3 20.0 130.3 % to Net Sales - - - 0.6% Net Income/Loss -4.23 -9.24 -5.01 △ 42.44 7.70 50.14 per Share (Yen) Ref: Assumed exchange rates for FY13/3 1$=¥75, 1€=¥100 * Forecasts as of July 31, 2012 (Note: Unchanged from 1H and full year forecasts announced on Apr 27) Page 16 © NEC Corporation 2012
  17. 17. 1H ForecastsFinancial Forecasts for 1H by Segment (Billions of Yen) Net Sales Operating Income/Loss 1.0 6.8 14.0 1,469.2 1,443.2 1,400.0 0.8 1.1 IT Solutions 15.3 17.0 2.0 547.7 CarrierIT Solutions 536.7 Network 7.5 570.0 Social 6.1 Personal 4.0 6.0 Solutions Infrastructure 2.9 3.4 Personal 2.2 3.0 4.0 Carrier Solutions -2.0 Network 261.4 283.5 Others 315.0 - 17.5 Social - 21.8Infrastructure 137.9 140.3 Eliminations/ Unclassifiable expenses 145.0 - 38.0 Personal Solutions 392.1 354.3 265.0 Others 130.1 128.5 105.0 FY11/3 FY12/3 FY13/3 FY11/3 FY12/3 FY13/3 1H 1H 1H (Forecasts) 1H 1H 1H (Forecasts) *Forecasts as of Jul 31, 2012 Page 17 © NEC Corporation 2012
  18. 18. 1H ForecastsSales Change (Year on Year) (Billions of Yen) Increase in aerospace and defense systems Deconsolidation of consumer PC Increase sales in Japan and Social Infrastructure Decrease in shipment of mobile terminals consolidation of Convergys +4.7 (+3.3%) Personal Solutions BSS Business Carrier Network -89.3 (-25.2%) +31.5 (+11.1%) Deconsolidation of LCD module business FY12/3 1H <Apr-Sep> 1,443.2 FY13/3 1H Others <Apr-Sep> IT Solutions -23.5 +33.3 (+6.2%) Forecasts 1,400.0 Stable business in IT Services and Platform *Forecasts as of Jul 31, 2012 Page 18 © NEC Corporation 2012
  19. 19. 1H ForecastsOperating Income/Loss Change (Year on Year) (Billions of Yen)Increase from sales expansiondespite making an investment for future growth Sales decrease in mobile terminals Carrier Network Personal Solutions +1.7 -5.4 Improvement by the effect of Sales increase restructuring measures despite making Cost reductions an investment for future growth Others IT Solutions Eliminations/ +1.0 +13.2 Unclassifiable Social Infrastructure expenses -0.1 -16.2 FY12/3 1H Increase in investment costs <Apr-Sep> Remain almost flat by 6.8 sales increase and cost reductions despite FY13/3 1H increase in investment <Apr-Sep> for future growth Forecasts 1.0 *Forecasts as of Jul 31, 2012 Page 19 © NEC Corporation 2012
  20. 20. 1H ForecastsKey Points of 1H, FY13/3 Forecasts by Segment (Year on Year)  Increase due to solid sales in IT services and Platform IT Solutions  Improve by sales increase and cost reductions Carrier  Increase due to solid sales in Japan and consolidation of Convergys BSS Business Network  Increase from sales expansion despite making an investment for future growth  Increase in aerospace and defense systems Social  Remain almost flat by sales increase and cost reductions despite increase in Infrastructure investment for future growth  Decline due to deconsolidation of consumer PC business and decrease in shipment Personal of mobile terminals Solutions  Decrease due to sales decrease in mobile terminal business  Decline due to deconsolidation of LCD module business Others  Improve by the effect of restructuring measures despite making an investment for future growth Note: First bullets refer to changes in sales, second bullets refer to changes in operating income/loss Page 20 © NEC Corporation 2012
  21. 21. 1H Forecasts IT Solutions Business Billions of Yen (YoY) (Billions of Yen) YoY ▐ Sales 570.0 (+6.2%) Sales +6.2%  IT Services -2.0% Increase in telecom sector 570.0 with continuing strong market 547.7 536.7 demand and IT investment +4.8% recovery in manufacturing and -2.2% Operating margin retail services sectors ratio 380.0 2.5%  PlatformIT Services 371.0 362.7 Increase mainly in hardware and 0.4% 0.1% enterprise network due to large-scale projects +9.2% ▐ Operating Income 14.0 (+13.2) -1.6% Operating 14.0 Platform 176.8 Income 174.0 190.0  Increase due to sales expansion and 2.0 0.8 cost reductions FY11/3 FY12/3 FY13/3 1H 1H 1H Forecasts *Forecasts as of Jul 31, 2012 Page 21 © NEC Corporation 2012
  22. 22. 1H ForecastsCarrier Network Business Billions of Yen (YoY) (Billions of Yen) YoY ▐ Sales 315.0 (+11.1%) Sales  Japan: Solid business due to increase in demand from data traffic hikes 315.0  Overseas: Increase due to 283.5 consolidation of Convergys BSS 261.4 +11.1% business and sales expansion in +8.4% Operating margin submarine cable systems ratio 5.4% 5.4% ▐ Operating Income 17.0 (+1.7) 2.9%  Expect to increase from sales expansion despite making an 17.0 Operating 15.3 investment for future growth Income 7.5 FY11/3 FY12/3 FY13/3 1H 1H 1H Forecasts *Forecasts as of Jul 31, 2012 Page 22 © NEC Corporation 2012
  23. 23. 1H ForecastsSocial Infrastructure Business Billions of Yen (YoY) (Billions of Yen) YoY ▐ Sales 145.0 (+3.3%) Sales  Slight increase in social systems due to stable sales in fire and disaster 140.3 145.0 prevention 137.9 +3.3%  Increase in aerospace and defense +1.8% systems 4.3% 4.1% ▐ Operating Income 6.0 (-0.1) Operating margin ratio 2.9%  Remain almost flat by sales increase and cost reductions despite increase in investment for future growth Operating Income 6.1 6.0 4.0 FY11/3 FY12/3 FY13/3 1H 1H 1H Forecasts *Forecasts as of Jul 31, 2012 Page 23 © NEC Corporation 2012
  24. 24. 1H ForecastsPersonal Solutions Business Billions of Yen (YoY) (Billions of Yen) YoY ▐ Sales 265.0 (-25.2%) Sales Mobile Terminals : 392.1 -9.6% Decline due to decrease in 354.3 shipment of feature phones -25.2% in Japan Mobile 155.4 +7.0% Terminals Operating Margin 166.3 265.0 PCs and Others : Ratio 1.0% -22.4% Decline due to deconsolidation 0.7% of consumer PC business and 129.0 impact of recession in Europe - 0.8% PCs and 236.7 -20.6% ▐ Operating Loss -2.0 (-5.4) Others Operating 188.0 -27.7% Income/Loss 136.0  Decrease due to sales decrease in 2.9 3.4 mobile terminals -2.0 FY11/3 FY12/3 FY13/3 1H 1H 1H Forecasts *Forecasts as of Jul 31, 2012 Page 24 © NEC Corporation 2012
  25. 25. Progress on four key businesses I. IT Services III. Social Infrastructure▐ Acquired Australia-based CSG IT ▐ Successful launch of the water services business cycle observation satellite ”SHIZUKU”▐ Expanded solution menu for ▐ Delivered digital transmitters for growth area “Mobacas”, a new multimedia (Big Data consulting services, broadcasting service for M2M solution for manufacturing sector) smartphones in Japan II. Carrier Network IV. Energy▐ Captured business opportunities ▐ Reached agreement on supplying arising from data traffic hikes with lithium-ion battery components to spread of smartphones and LTE GS Yuasa▐ Started integrated operations of ▐ Started shipping small-scale NetCracker OSS business and energy storage system Convergys BSS business Page 25 © NEC Corporation 2012
  26. 26. Summary▐ Results for Q1  Sales: Increase by approximately 1% year on year excluding the impact of deconsolidation of consumer PC and LCD module businesses • Increase in Carrier Network and IT Solutions (Sales decreased by 5.6% year on year including the impact of deconsolidation)  Operating loss: Improve by 11.6B Yen year on year  Stable progress in profit compared to forecasts announced on Apr 27▐ Forecasts for 1H  Aim for further improvement mainly in stable segments Accelerate measures to achieve forecasts for 1H and ensure to complete restructuring by the end of September Page 26 © NEC Corporation 2012
  27. 27. NEC Group Vision 2017 To be a leading global companyleveraging the power of innovation to realize an information society friendly to humans and the earth © NEC Corporation 2012
  28. 28. © NEC Corporation 2011 Page 28 © NEC Corporation 2012
  29. 29. Financial Results for Q1, FY13/3 (Appendix)
  30. 30. Q1 ResultsSummary of Financial Results for Q1 by Segment (Billions of Yen) Net Sales Operating Income/Loss IT Solutions Others Operating Loss 8% 40% for Q1,FY13/3 Carrier Network Personal -7.9 Solutions 11.2 21% Sales for Q1 Social FY13/3 Infrastructure 1.4 631.5 Social OthersInfrastructure Personal 9% Solutions -1.4 IT Solutions Carrier Network -3.0 22% -5.8 Page 30 © NEC Corporation 2012
  31. 31. Q1 ResultsSummary of Financial Results for Q1 by Segment (Billions of Yen) Q1(April to June) FY12/3 FY13/3 YoY Actual Actual Net Sales 237.4 249.2 5.0% IT Solutions Operating Loss -12.8 -5.8 7.0 % to Net Sales - - Net Sales 127.5 141.3 10.9% Carrier Operating Income 2.4 11.2 8.8 Network % to Net Sales 1.9% 7.9% Net Sales 58.8 59.2 0.8% Social Operating Income 0.4 1.4 1.0 Infrastructure % to Net Sales 0.7% 2.4% Net Sales 183.5 132.5 - 27.8% Personal Operating Income/Loss 1.3 -3.0 -4.3 Solutions % to Net Sales 0.7% - Net Sales 61.9 49.3 - 20.4% Others Operating Loss -1.3 -1.4 -0.1 % to Net Sales - - Eliminations/ Unclassifiable expenses Operating Loss -9.5 -10.3 -0.9 Net Sales 669.1 631.5 - 5.6% Total Operating Loss -19.4 -7.9 11.6 % to Net Sales - - Page 31 © NEC Corporation 2012
  32. 32. Q1 ResultsOverseas Sales (Billions of Yen) Q1(April to June) FY12/3 FY13/3 Major countries and regions YoY Actual Actual Net Sales 31.0 36.1 16.3% China,Chinese Taipei,India, Asia Singapore and Indonesia To consolidated total sales (%) 4.6% 5.7% Net Sales 24.3 17.8 - 26.9% UK,France,Netherlands, Europe Germany,Italy and Spain To consolidated total sales (%) 3.6% 2.8% Net Sales 59.8 43.6 - 27.1% U.S.A Others To consolidated total sales (%) 8.9% 6.9% Net Sales 115.1 97.4 - 15.4% Total To consolidated total sales (%) 17.2% 15.4% * Sales are classified into country or region based on the locations of customersPage 32 © NEC Corporation 2012
  33. 33. Q1 ResultsFinancial Positions (Billions of Yen) Difference End of Mar End of Jun End of Jun from Mar 2012 2012 2012 2011 Total Assets 2,557.6 2,371.7 -185.8 2,465.7 Net Assets 777.6 745.7 -31.9 843.7 Interest-bearing debt 692.7 641.7 -51.0 646.1 Shareholders Equity 657.0 626.3 -30.7 726.3 Equity ratio(%) 25.7% 26.4% 0.7pt 29.5% D/E ratio 1.05 1.02 0.03pt 0.89 Net D/E ratio 0.67 0.67 0.00pt 0.63 Balance of cash and cash equivalents 251.8 222.0 -29.8 188.1Page 33 © NEC Corporation 2012
  34. 34. Q1 Results<Ref.> Balance Sheets (At the end of June, 2012) (Billions of Yen) <Compared to end of Mar, 2012> Total Assets 2,371.7 (-185.8) Compared to end of Mar, 2012Current Assets Liabilities 1,318.7 1,626.0 -195.8 Decrease in notes and accounts Collecting accounts -154.0 payable-trade, accrued expenses and redemption of commercial receivable paperNoncurrent Assets 1,053.1 Net Assets +9.9 Increase intangible assets 745.7 by business acquisition -31.9 Recording net loss for Q1,FY13/3 Page 34 © NEC Corporation 2012
  35. 35. Financial Forecasts for 1H, FY13/3 (Appendix)
  36. 36. 1H ForecastsSummary of Financial Forecasts for 1H (Billions of Yen) Q2 (July to September) 1H (April to September) FY12/3 FY13/3 FY12/3 FY13/3 YoY YoY Actual Forecasts Actual Forecasts Net Sales 774.1 768.5 - 0.7% 1,443.2 1,400.0 - 3.0% Operating Income 26.2 8.9 -17.3 6.8 1.0 -5.8 % to Net Sales 3.4% 1.2% 0.5% 0.1% Ordinary Income/Loss 19.2 -3.8 -23.1 -10.4 -16.0 -5.6 % to Net Sales 2.5% - - - Net Income/Loss 18.7 -6.1 -24.9 -11.0 -24.0 -13.0 % to Net Sales 2.4% - - - Net Income/Loss -4.23 -9.24 -5.01 per Share (Yen) Ref: Assumed exchange rates for FY13/3 1$=¥75, 1€=¥100 *Forecasts as of Jul 31, 2012 Page 36 © NEC Corporation 2012
  37. 37. 1H ForecastsSummary of Financial Forecasts by Segment (Billions of Yen) Q2 (July to September) 1H (April to September) FY12/3 FY13/3 YoY FY12/3 FY13/3 YoY Actual Forecasts Actual Forecasts Net Sales 299.3 320.8 7.2% 536.7 570.0 6.2% IT Solutions Operating Income 13.6 19.8 6.2 0.8 14.0 13.2 % to Net Sales 4.5% 6.2% 0.1% 2.5% Net Sales 156.0 173.7 11.3% 283.5 315.0 11.1% Carrier Operating Income 12.9 5.8 -7.1 15.3 17.0 1.7 Network % to Net Sales 8.3% 3.3% 5.4% 5.4% Net Sales 81.5 85.8 5.2% 140.3 145.0 3.3% Social Operating Income 5.7 4.6 -1.1 6.1 6.0 -0.1 Infrastructure % to Net Sales 6.9% 5.4% 4.3% 4.1% Net Sales 170.8 132.5 - 22.4% 354.3 265.0 - 25.2% Personal Operating Income/Loss 2.1 1.0 -1.1 3.4 -2.0 -5.4 Solutions % to Net Sales 1.2% 0.7% 1.0% - Net Sales 66.5 55.7 - 16.3% 128.5 105.0 - 18.3% Others Operating Income 4.3 5.4 1.1 3.0 4.0 1.0 % to Net Sales 6.5% 9.7% 2.4% 3.8% Eliminations/ Unclassifiable expenses Operating Loss -12.3 -27.7 -15.4 -21.8 -38.0 -16.2 Net Sales 774.1 768.5 - 0.7% 1,443.2 1,400.0 - 3.0% Total Operating Income 26.2 8.9 -17.3 6.8 1.0 -5.8 % to Net Sales 3.4% 1.2% 0.5% 0.1% *Forecasts as of Jul 31, 2012 Page 37 © NEC Corporation 2012
  38. 38. 1H ForecastsSummary of Financial Forecasts for 1H by Segment (Billions of Yen) Net Sales Operating Income/Loss IT Solutions Others 41% Operating Income 7% Carrier forecast for 1H,FY13/3 Network Personal Solutions 17.0 1.0 IT Solutions 19% 14.0 Sales Forecast Social for 1H, FY13/3 Infrastructure Others 6.0 1,400.0 4.0 SocialInfrastructure 10% Personal Carrier Network Solutions 23% -2.0 *Forecasts as of Jul 31, 2012 Page 38 © NEC Corporation 2012
  39. 39. Full Year ForecastsCapital Expenditure, Depreciation and R&D expenses (Billions of Yen) FY12/3 FY13/3 YoY Actual Forecasts Capial Expenditure 42.0 50.0 19.1% Depreciation 53.3 55.0 3.2% R&D expenses 162.0 170.0 5.0% To consolidated total sales (%) 5.3% 5.4% * Forecasts as of July 31, 2012 (Note: Unchanged from forecasts announced on Apr 27) Page 39 © NEC Corporation 2012
  40. 40. Reference (Financial data)
  41. 41. Net Sales, Operating Income/Loss (Billions of yen) 7.6% 8.1% Operating income ratio YoY 3.0% 3.4% - 1.9% - 1.2% - 1.2% - 3.5% - 2.9% -16.2% Net Sales -0.1% -8.4% -3.4% -12.7% 925.5 924.6 -14.2% +0.2% -7.2% 801.6 118.8 118.7 -5.6% (12.8%) 774.1 (12.8%) 720.7 667.5 128.8 669.1 669.0 Overseas Sales (16.1%) 117.5 138.8 631.5 (17.9%)(Overseas Sales Ratio) 114.2 (16.3%) 115.1 108.9 97.4 (17.1%) (17.2%) (16.3%) (15.4%) 70.2 75.2 Sales in Japan Operating Income/ Loss 24.3 26.2 -23.2 -13.5 -19.4 -7.9 -8.2 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 <Apr-Jun> <Jul-Sep> <Oct-Dec> <Jan-Mar> <Apr-Jun> <Jul-Sep> <Oct-Dec> <Jan-Mar> <Apr-Jun> FY11/3 FY12/3 FY13/3 Page 41 © NEC Corporation 2012
  42. 42. Sales, Operating Income/Loss (IT Solutions) (Billions of yen) 12.0% 9.7% YoY Operating income ratio 4.0% 4.5% - 1.4% - 2.3% - 4.2% - 3.4% +4.6% - 5.4% 396.3 378.7 -2.3% Net Sales 306.5 +1.1% +5.0% -1.6% 299.3 253.5 256.3 249.2 241.3 237.4 278.4 262.2 209.7 205.2 47.6 IT 161.2 171.0 36.9 157.5 175.8 165.9 Services Operating Income/ Loss 12.1 13.6 116.5 117.9 96.7 82.5 94.1 80.5 83.3 80.0 -10.1 -8.6 79.9 -12.8 -3.6 -5.8 Platform Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 <Apr-Jun> <Jul-Sep> <Oct-Dec> <Jan-Mar> <Apr-Jun> <Jul-Sep> <Oct-Dec> <Jan-Mar> <Apr-Jun> FY11/3 FY12/3 FY13/3 Page 42 © NEC Corporation 2012
  43. 43. Sales, Operating Income/Loss (Carrier Network) (Billions of yen) 14.3% 15.3% Operating income ratio YoY 8.7% 8.3% 7.9% 5.8% 3.5% 1.9% 179.8 177.6 - 4.9% 156.0 Net Sales 149.1 141.7 136.0 -1.2% 141.3 127.5 112.3 +4.6% +4.2% +10.9% +13.5% 25.7 27.1 Operating Income/ 13.0 12.9 11.2 Loss 4.7 8.2 2.4 -5.5 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 <Apr-Jun> <Jul-Sep> <Oct-Dec> <Jan-Mar> <Apr-Jun> <Jul-Sep> <Oct-Dec> <Jan-Mar> <Apr-Jun> FY11/3 FY12/3 FY13/3 Page 43 © NEC Corporation 2012
  44. 44. Sales, Operating Income/Loss (Social Infrastructure) (Billions of yen) YoY Operating income ratio 8.8% 6.9% 7.3% 4.6% 2.4% 0.7% 0.7% 1.9% 120.1 0.6% 114.3 +5.1% Net Sales 79.5 81.5 70.0 66.6 58.4 58.8 +2.6% 59.2 +5.1% +0.7% +0.8% Operating 10.1 8.7 Income/ 5.7 Loss 3.7 0.4 0.4 1.3 1.4 0.3 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 <Apr-Jun> <Jul-Sep> <Oct-Dec> <Jan-Mar> <Apr-Jun> <Jul-Sep> <Oct-Dec> <Jan-Mar> <Apr-Jun> FY11/3 FY12/3 FY13/3 Page 44 © NEC Corporation 2012
  45. 45. Sales, Operating Income/Loss (Personal Solutions) (Billions of yen) Operating income ratio YoY 1.6% 1.2% 0.7% 0.3% - 0.2% - 0.8% - 1.8% - 2.1% - 2.2% Net Sales -5.2% -14.0% -9.2% 193.5 198.5 193.0 183.5 -26.4% 181.5 -27.8% 170.8 164.7 76.3 142.0 Mobile 79.1 80.3 67.8 79.5 132.5 Terminals 86.8 75.3 59.4 57.4 Operating PCs and Income/ Others 114.4 Loss 122.3 112.7 113.7 104.0 84.0 82.6 89.4 3.3 2.1 75.1 1.3 -0.4 -1.6 -3.2 -3.0 0.6 -3.0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 <Apr-Jun> <Jul-Sep> <Oct-Dec> <Jan-Mar> <Apr-Jun> <Jul-Sep> <Oct-Dec> <Jan-Mar> <Apr-Jun> FY11/3 FY12/3 FY13/3 Page 45 © NEC Corporation 2012
  46. 46. Sales, Operating Income/Loss (Others) (Billions of yen) Operating income ratio 8.7% YoY 5.7% 6.7% 6.5% 3.1% 4.0% - 2.8% - 2.1% - 2.8% Net Sales -0.1% -2.3% -7.5% -17.5% 71.6 71.3 68.1 66.5 66.0 -20.4% 62.0 61.9 59.0 49.3 Operating Income/ 5.8 Loss 3.9 4.8 4.3 2.2 2.4 -1.7 -1.3 -1.4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 <Apr-Jun> <Jul-Sep> <Oct-Dec> <Jan-Mar> <Apr-Jun> <Jul-Sep> <Oct-Dec> <Jan-Mar> <Apr-Jun> FY11/3 FY12/3 FY13/3 Page 46 © NEC Corporation 2012
  47. 47. Exchange Rate (Yen)115 Euro/Yen Exchange rate(Actual) Average exchange rate ¥106.09 Assumed Exchange rate110105100 95 85 Average exchange rate ¥81.25 Dollar/Yen Exchange rate(Actual) Assumed Exchange rate 80 75 70 4/2 4/30 5/31 6/29 Page 47 © NEC Corporation 2012
  48. 48. Stock Price (Yen)10,500 180 17010,000 160 Apr 27:FY12/3 Earnings 150 9,500 Jun 22:Ordinary General Meeting of Shareholders 140 9,000 130 120 8,500 NEC the Nikkei Stock 110 8,000 100 4/2 4/27 5/30 6/22 6/29 Page 48 © NEC Corporation 2012
  49. 49. CAUTIONARY STATEMENTS:This material contains forward-looking statements pertaining to strategies, financial targets, technology, products and services,and business performance of NEC Corporation and its consolidated subsidiaries (collectively "NEC"). Written forward-lookingstatements may appear in other documents that NEC files with stock exchanges or regulatory authorities, such as the Directorof the Kanto Finance Bureau, and in reports to shareholders and other communications. NEC is relying on certain safe-harbors for forward-looking statements in making these disclosures. Some of the forward-looking statements can be identifiedby the use of forward-looking words such as "believes," "expects," "may," "will," "should," "seeks," "intends," "plans,""estimates," "targets," "aims," or "anticipates," or the negative of those words, or other comparable words or phrases. You canalso identify forward-looking statements by discussions of strategy, beliefs, plans, targets, or intentions. Forward-lookingstatements necessarily depend on currently available assumptions, data, or methods that may be incorrect or imprecise andNEC may not be able to realize the results expected by them. You should not place undue reliance on forward-lookingstatements, which reflect NEC’s analysis and expectations only. Forward-looking statements are not guarantees of futureperformance and involve inherent risks and uncertainties. A number of important factors could cause actual results to differmaterially from those in the forward-looking statements. Among the factors that could cause actual results to differ materiallyfrom such statements include (i) global economic conditions and general economic conditions in NEC’s markets, (ii) fluctuatingdemand for, and competitive pricing pressure on, NEC’s products and services, (iii) NEC’s ability to continue to winacceptance of NEC’s products and services in highly competitive markets, (iv) NEC’s ability to expand into foreign markets,such as China, (v) regulatory change and uncertainty and potential legal liability relating to NEC’s business and operations, (vi)NEC’s ability to restructure, or otherwise adjust, its operations to reflect changing market conditions, (vii) movement ofcurrency exchange rates, particularly the rate between the yen and the U.S. dollar, (viii) the impact of unfavorable conditionsor developments, including share price declines, in the equity markets which may result in losses from devaluation of listedsecurities held by NEC, and (iv) impact of any regulatory action or legal proceeding against NEC. Any forward-lookingstatements speak only as of the date on which they are made. New risks and uncertainties come up from time to time, and it isimpossible for NEC to predict these events or how they may affect NEC. NEC does not undertake any obligation to update orrevise any of the forward-looking statements, whether as a result of new information, future events, or otherwise.The management targets included in this material are not projections, and do not represent management’s current estimatesof future performance. Rather, they represent targets that management will strive to achieve through the successfulimplementation of NEC’s business strategies.Finally, NEC cautions you that the statements made in this material are not an offer of securities for sale. Securities may notbe offered or sold in any jurisdiction in which required registration is absent or an exemption from registration under theapplicable securities laws is not granted.

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