Presentations & Events
- ended March 2008 (For 169th Fiscal Period)
Presentation for FY2007 Results
For Fiscal Year ended March, 2008 - April 25, 2008
- PDF [209KB/25 pages]
Outline of the presentation
1. Consolidated results for FY2007
|Net Sales||7,668.1 billion yen||(+551.7 billion yen YoY)|
|Operating income||238.1 billion yen||(-20.3 billion yen YoY)|
|Income before income taxes and minority interest||255.6 billion yen||(-42.9 billion yen YoY)|
|Net income||127.4 billion yen||(-10.0 billion yen YoY)|
- Toshiba posted higher consolidated sales, reflecting proactive management, including strategic allocation of resources grounded in the Group strategy of achieving sustained growth with profit. Toshiba's overall consolidated sales for the full-year term were 7,668.1 billion yen, an increase of 551.7 billion yen.
- Consolidated operating income declined by 20.3 billion yen to 238.1 billion yen. Social Infrastructure recorded substantially increased operating income, while Electronic Devices saw significantly lower operating income.
- Income before income taxes and minority interest decreased by 42.9 billion yen to 255.6 billion yen, a figure primarily reflecting the costs incurred in the withdrawal from the HD DVD business and the impact of changes in estimate of salvage value of property, plant and equipment (P.P.E.), in spite of the gain from the sale of the Ginza Toshiba Building. Net income decreased by 10.0 billion yen to 127.4 billion yen.
2. Financial Position and Cash Flows for FY2007
- Total debt increased by 102.5 billion yen from the end of March 2007 to 1,261.0 billion yen.
- Shareholders' equity decreased by 86.0 billion yen to 1,022.3 billion yen from the end of March 2007.
- Total debt increased by 226.5 billion yen from the end of March 2007 to 1,385.0 billion yen.
- As a result of the foregoing, the debt-to-equity ratio as of the end of March 2008 was 123%, an 18-point worsening from the end of March 2007.
- Free cash flow was minus 75.6 billion yen, a 75.7 billion yen improvement from the same period of the previous year.
3. Consolidated Forecast for FY2008
|Net Sales||8,000.0 billion yen||(+331.9 billion yen YoY)|
|Operating income||290.0 billion yen||(+51.9 billion yen YoY)|
|Income before income taxes and minority interest||260.0 billion yen||(+4.4 billion yen YoY)|
|Net income||130.0 billion yen||(+2.6 billion yen YoY)|
Q & A Session
- Q1. Is it possible to get supplementary information on your 2008 earnings projections for individual business units?
- Looking forward, we expect the TV business operating income and loss to be in the black. Our operating income forecasts in other businesses are:
- PC business: 30 billion yen (est.).
- Semiconductor business: 90 billion yen (est.).
*The rate of price decline in NAND Flash memory is expected to be somewhere between 40% and 50% annually.
- LCD business: 5 billion yen (est.).
- Social Infrastructure segment, including Power Systems and Medical Systems: 120 billion yen (est.).
*They will remain steady, as we do not expect any significant changes in the market environment.
- Q2. Please outline the effect that the change in accounting regulations for estimation of salvage value contained in the changes in the 2007 and 2008 tax regulations have on your 2008 business result estimations.
- We expected that the effect of the 2007 changes in the tax regulations to have in impact of about 50 billion yen on operating income in fiscal year 2008. This is due to an increase of depreciation in new equipment acquisitions. Also, in accordance with the 2008 tax regulation changes, due to the reevaluation of duration period, depreciation charge will be added by about another 16 billion yen. So, 66 billion yen is affected in operating income.
- Q3. What were your losses in relation to withdrawal from the HD DVD business in fiscal year 2007? In addition, what is your forecast for related losses for fiscal year 2008?
- Operation loss of HD DVD business in fiscal year 2007 was 60.2 billion yen. This plus the cost of withdrawal from the business, 48.3 billion yen, gave us a total loss of 108.5 billion yen. The cost of withdrawal from the business includes disposal of inventory and the cost of disposal of manufacturing lines.
We expected to see costs of several billion yen in fiscal year 2008, related to strengthening the customer support system, etc.
- Q4. How much will you invest for the semiconductor Memory business in 2008?
- Construction of Fabs 5 and 6 at Yokkaichi Operations has not yet started, and this CAPEX is not included in the 2008 CAPEX plan. In order to apply advanced technology process and expand production on 12-inch wafers, we will maintain investment at roughly the same high level as in 2007.
- Q5. Please explain the status of orders received in the nuclear power business.
- We have received four orders, reactor islands, in China and four in the U.S. We expect revenue from construction of these plants be recognized after 2010.
- Q6. Please explain the reason for the decrease in profit of home appliances business.
- The decrease is due to reasons such as unexpected selling expense increase.
- Q7. Please outline the risks involved in component and material procurement.
- An impact from escalation of the cost of components and materials is unavoidable. However, we are making attempts to minimize impact of the rise by standardizing parts at the design phase and purchasing components in bulk.
We expected to see an impact of several billion yen as a result of rising component supply costs.
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