NIDEC CORPORATION FOR IMMEDIATE RELEASE
Contact:
Masahiro Nagayasu General Manager Investor Relations
+81-75-935-6140
ir@nidec.com
UNAUDITED FINANCIAL STATEMENTS (IFRS)
(English Translation)
RESULTS FOR THE YEAR ENDED MARCH 31, 2017 FROM APRIL 1, 2016 TO MARCH 31, 2017 CONSOLIDATED
Released on April 25, 2017
NIDEC CORPORATIONStock Listings: Tokyo Stock Exchange
Head Office: Kyoto, Japan
Date of Filing of Japanese Annual Securities Report (Plan): June 19, 2017
Selected Consolidated Financial Performance Information for the Year Ended March 31, 2017 (IFRS) (unaudited)
Consolidated Results of Operations
Yen in millions Year ended March 31 2017 2016
Net sales 1,199,311 1,178,290
Ratio of change from the previous fiscal year 1.8% - Operating profit 140,331 117,662
Ratio of change from the previous fiscal year 19.3% -
Profit before income taxes 142,278 117,164
Ratio of change from the previous fiscal year 21.4% -
Profit attributable to owners of the parent 111,721 89,945
Ratio of change from the previous fiscal year 24.2% -
Comprehensive income for the year 108,925 31,278
Ratio of change from the previous fiscal year 248.2% -
Yen
Year ended March 31
2017
2016
Earnings per share attributable to owners of the parent -Basic
376.67
303.04
Earnings per share attributable to owners of the parent -Diluted
376.67
301.93
Notes:
Weighted-average of Nidec Corporation shareholders' equity at the beginning and the end of each fiscal year
Share of net profit (loss) from associate accounting using the equity method:
¥ (534) million for the year ended March 31, 2017
¥ 1 million for the year ended March 31, 2016
Consolidated Financial Position
Yen in millions
March 31, 2017 March 31, 2016
Total assets 1,676,901 1,376,636
Total equity 856,519 771,369
Total equity attributable to owners of the parent 847,285 763,023 Ratio of total equity attributable to owners of the parent to total assets 50.5% 55.4%
Dividends (unaudited)
Year ending March 31, 2018
(target)
Yen
Year ended March 31, 2017 (actual)
Year ended March 31, 2016 (actual)
Interim dividend per share ¥45.00 ¥40.00 ¥40.00
Year-end dividend per share 45.00 45.00 40.00
Annual dividend per share ¥90.00 ¥85.00 ¥80.00 Dividends declared for the year - ¥25,211 million ¥23,789 million Dividend payout ratio *1 21.4% 22.6% 26.4.% Dividend to Nidec Corporation shareholders'
equity - 3.1% 3.1%
Note:
"Annual dividend per share" to "earning per share-basic"
Forecast of Consolidated Financial Performance (for the fiscal year ending March 31, 2018)
Yen in millions
Inc./Dec. ratio of change from the previous fiscal
year
Net sales 1,350,000 12.6%
Operating profit 160,000 14.0%
Profit before income taxes 158,000 11.1%
Profit attributable to owners of the parent 125,000 11.9%
Earnings per share attributable to owners of the parent -Basic (Yen) 421.44
Others
Changes in significant subsidiaries (changes in "specified subsidiaries" (tokutei kogaisha) accompanying changes in the scope of consolidation) during this period: None
Changes in accounting policies:
Changes due to revisions to accounting standards: None
Changes due to other reasons: None
Changes in accounting estimates: None
Number of shares issued (common stock)
Number of shares issued at the end of each period (including treasury stock): 298,142,234 shares at March 31, 2017
298,142,234 shares at March 31, 2016
Number of treasury stock at the end of each period: 1,544,634 shares at March 31, 2017
1,541,210 shares at March 31, 2016
Weighted-average number of shares issued at the beginning and end of each period: 296,599,414 shares for the year ended March 31, 2017
296,807,985 shares for the year ended March 31, 2016
NIDEC adopts International Financial Reporting Standards ("IFRS") for its consolidated financial statements from the first quarter of the fiscal year ended March 31, 2017. Accordingly, the consolidated financial statements for the previous fiscal year and condensed quarterly consolidated financial statements for the year ended March 31, 2016 are also presented in accordance with IFRS.
NIDEC finalized the provisional accounting treatment for the business combination in the three months ended September 30, 2016. Consolidated financial statements for the previous fiscal year and condensed quarterly consolidated financial statements for the year ended March 31, 2016 reflect the revision of the initially allocated amounts of acquisition price as NIDEC finalized the provisional accounting treatment for the business combination.
Investor presentation materials relating to our financial results for year ended March 31, 2017 are expected to be published on our corporate website on April 26, 2017.
1. Operating and Financial Review and Prospects(1) Quantitative Information on the Company's Consolidated Operating Results
Overview of Business Environment for the Year Ended March 31, 2017
For the year ended March 31, 2017, the U.S. economy continued to expand moderately, while a concurrent global stock market rally known as the "Trump rally," which continued since Donald Trump was elected as President of the United States, has now been settled. While Europe and Japan continue to enjoy a moderate recovery, China, supported by its domestic demand expansion based on public works projects, is making a steady economic growth, with resource-rich countries like Brazil and Russia on their way to exit the current economic struggle as their commodity markets recover.
Under such a business environment, NIDEC (Nidec Corporation and its consolidated subsidiaries) continued to pursue our targets for the fiscal year ending March 31, 2020 of consolidated net sales of ¥2 trillion and an operating profit ratio of 15% based on our mid-term strategic goal, "Vision 2020," and we achieved in the fiscal year ended March 31, 2017 the highest operating profit, profit before income taxes and profit for the period in our history.
Consolidated Operating Results
Financial Position
Yen in millions
As of March 31, 2016
As of March 31, 2017
Increase or decrease
Total assets
1,376,636
1,676,901
300,265
Total liabilities
605,267
820,382
215,115
Total equity attributable to owners of the parent
763,023
847,285
84,262
Interest-bearing debt *1
300,667
412,431
111,764
Net interest-bearing debt *2
(5,275)
90,851
96,126
Debt ratio *3
21.8%
24.6%
2.8%
Debt to equity ratio ("D/E ratio") (times) *4
0.39
0.49
0.10
Net D/E ratio (times) *5
(0.01)
0.11
0.12
Ratio of total equity attributable to owners of the parent to
55.4%
50.5%
(4.9)%
total assets *6
Notes:
*1: The sum of "short term borrowings," "long term debt due within one year" and "long term debt" in our consolidated statement of financial position
*2: "Interest-bearing debt" less "cash and cash equivalents"
*3: "Interest-bearing debt" divided by "total assets"
*4: "Interest-bearing debt" divided by "total equity attributable to owners of the parent"
*5: "Net interest-bearing debt" divided by "total equity attributable to owners of the parent"
*6: "Total equity attributable to owners of the parent" divided by "total assets"
Total assets increased approximately ¥300,300 million to ¥1,676,901 million as of March 31, 2017 compared to March 31, 2016. This increase was mainly due to an increase of approximately ¥98,100 million in goodwill, an increase of approximately ¥97,600 million in trade and other receivables and an increase of approximately ¥47,100 million in property, plant, and equipment.
Total liabilities increased approximately ¥215,100 million to ¥820,382 million as of March 31, 2017 compared to March 31, 2016. This increase was mainly due to an increase of approximately ¥111,800 million in interest-bearing debt and an increase of approximately ¥64,200 million in trade and other payables. Specifically, our short term borrowings increased approximately ¥85,500 million to approximately ¥166,600 million, our long term debt due within one year increased approximately ¥1,300 million to approximately ¥84,000 million, and our long term debt increased approximately ¥25,000 million to approximately ¥161,800 million as of March 31, 2017 compared to March 31, 2016. The decrease of approximately ¥50,000 million was mainly due to the redemption of fourth series unsecured bonds (ranking pari passu with the other series of unsecured straight bonds) issued in December 2013, however approximately ¥50,000 million increased due to the issue of fifth series unsecured bonds (ranking pari passu with the other series of unsecured straight bonds) in November 2016.
As a result, our net interest-bearing debt increased to approximately ¥90,900 million as of March 31, 2017 from approximately negative ¥5,300 million as of March 31, 2016. Our debt ratio increased to 24.6% as of March 31, 2017 from 21.8% as of March 31, 2016. Our D/E ratio increased to 0.49 as of March 31, 2017 from 0.39 as of March
31, 2016. Our net D/E ratio increased to 0.11 as of March 31, 2017 compared to negative 0.01 as of March 31, 2016.
Total equity attributable to owners of the parent increased approximately ¥84,300 million to ¥847,285 million as of March 31, 2017 compared to March 31, 2016. Ratio of total equity attributable to owners of the parent to total assets decreased to 50.5% as of March 31, 2017 from 55.4% as of March 31, 2016. The decrease of ratio of total equity attributable to owners of the parent to total assets was mainly due to an increase in retained earnings of approximately ¥91,500 million as of March 31, 2017 compared to March 31, 2016.
The financial position includes approximately ¥207,000 million of total assets such as approximately
¥33,900 million in trade and other receivables and approximately ¥59,100 million of total liabilities such as approximately ¥21,200 million in notes payable and accounts payable related to the acquisition of the motors, drives and electric power generation businesses in Emerson Electric Co (currently, Nidec Leroy-Somer Holding and Nidec Control Techniques Limited, etc).
NIDEC finalized the provisional accounting treatment for the business combination in the three months ended September 30, 2016. Consolidated financial statements for the previous fiscal year and condensed quarterly consolidated financial statements for the year ended March 31, 2016 reflect the revision of the initially allocated amounts of acquisition price as NIDEC finalized the provisional accounting treatment for the business combination.
Overview of Cash Flow-
For the year
ended March 31 2016 2017
Yen in millions Increase or decrease
Net cash provided by operating activities 147,659 129,853 (17,806)
Net cash used in investing activities (95,377) (211,476) (116,099)
Free cash flow *1 52,282 (81,623) (133,905) Net cash provided by (used in) financing activities 7,775 95,848 88,073
Note:
*1: Free cash flow is the sum of "net cash provided by operating activities" and "net cash used in investing activities."
Cash flows from operating activities for the fiscal year ended March 31, 2017 ("this fiscal year") were a net cash inflow of ¥129,853 million. Compared to the fiscal year ended March 31, 2016 ("the prior fiscal year"), our cash inflow from operating activities for this fiscal year decreased approximately ¥17,800 million. This decrease was mainly due to an increase of approximately ¥60,400 million in accounts receivable, although there were increases of approximately ¥46,100 million in account payable and approximately ¥21,700 million of profit for the period.
Cash flows from investing activities for this fiscal year were a net cash outflow of ¥211,476 million. Compared to the prior fiscal year, our net cash outflow from investing activities for this fiscal year increased approximately ¥116,100 million mainly due to an increase in acquisition of business of approximately ¥130,200 million.
As a result, we had a negative free cash flow of ¥81,623 million for this fiscal year, an decrease of approximately ¥133,900 million compared to a positive free cash flow of ¥52,282 million for the prior fiscal year.
Cash flows from financing activities for this fiscal year were a net cash inflow of ¥95,848 million. Compared to the prior fiscal year, our net cash inflow from financing activities for this fiscal year increased approximately ¥88,100 million mainly due to an increase in net cash inflow from short term borrowings of approximately ¥61,400 million, long term debt of ¥20,800 and issuance of corporate bonds of approximately ¥50,000 million. On the other hand, outflow from redemption of corporate bonds increased approximately ¥50,000 million.
As a result of the foregoing and the impact of foreign exchange fluctuations of approximately positive
¥1,400 million, the balance of cash and cash equivalents as of March 31, 2017 was ¥321,580 million, an increase of approximately ¥15,600 million from March 31, 2016.
Reference:
Ratio of total equity attributable to owners of the parent to total
As of
March 31, 2016
As of March 31, 2017
assets (%)(*1) 55.4 50.5
Total market value of Nidec's shares to total assets (%)(*2) 165.9 187.4
Interest-bearing liabilities to net cash provided by operating
activities (years) (*3) 2.0 3.2
Interest coverage ratio (times) (*4) 82.2 42.5
Notes:
*1. Ratio of total equity attributable to owners of the parent to total assets: Total equity attributable to owners of the parent divided by total assets
*2. Total market value of Nidec's shares to total assets: Total market value of Nidec's shares (1) divided by total assets
*3. Interest-bearing liabilities to net cash provided by operating activities: Interest-bearing liabilities (2) divided by net cash provided by operating activities
*4. Interest coverage ratio: Net cash provided by operating activities divided by interest payments (3)
Total market value: Closing stock price at fiscal year end (TSE) multiplied by the number of shares issued at fiscal year end (excluding treasury stock)
Interest-bearing liabilities: Total amount of "short term borrowings", "current portion of long term debt" and "long term debt" on the consolidated statements of financial position
Interest payments: "Interests paid" on the consolidated statements of cash flows
(3) Business Forecasts for the Fiscal Year ending March 31, 2018
While expectations grow for a continued economic recovery supported by the US's financial policies, the US government's future trade and financial policies may cause uncertainty over the future economic outlook of China and other emerging economies. Such uncertainty, which may pose geopolitical risks in the Middle East, affect national political elections scheduled to be held in Europe this year, and lead Italian financial institutions' management crisis to cause financial unrest, requires a constant monitoring.
Under such a business environment, NIDEC continued to pursue our targets for the fiscal year ending March 31, 2021 based on our mid-term strategic goal, "Vision 2020".
Forecast of consolidated results for the fiscal year ending March 31, 2018
Net sales
¥1,350,000 million
(Up 12.6% from the previous fiscal year)
Operating profit
¥160,000 million
(Up 14.0% from the previous fiscal year)
Profit before income taxes
¥158,000 million
(Up 11.1% from the previous fiscal year)
Profit attributable to owners of the
parent
¥125,000 million
(Up 11.9% from the previous fiscal year)
Forecast of consolidated results for the six months ending September 30, 2017
(Up 10.8% from the same period of the
Net sales ¥625,000 million
Operating profit ¥75,000million
Profit before income taxes ¥74,000 million Profit attributable to owners of the
parent ¥58,000 million
previous fiscal year)
(Up 8.7% from the same period of the previous fiscal year)
(Up 11.7% from the same period of the previous fiscal year)
(Up 15.8% from the same period of the previous fiscal year)
Notes:
Consolidated results are based on IFRS.
The exchange rates used for the preparation of the foregoing forecasts are US$1 = ¥105 and €1 = ¥110. The exchange rates between the relevant Asian currencies and the Japanese yen used for the preparation of the foregoing forecasts were determined assuming these exchange rates.
Basic management policies
We aim to become the world's leading comprehensive motor manufacturer, maximize shareholder value, and meet the expectations of shareholders by delivering higher technology solutions, offering higher wages, and thus achieving higher growth, profit and stock prices, over the long-term. We seek to uphold the following three management goals and principles:
Employment stability based on sustainable business growth;
Available supply of highest quality, indispensable, and widely desired products for the common good for all;
Pursuit of the top leader position in each of the company's chosen paths.
Management targets
We endeavor to pursue profitable growth by setting a new medium-term strategic target for the fiscal year ending March 31, 2021. Its main components are as follows:
Consolidated net sales of ¥2 trillion (including approximately ¥500 billion contributed by new M&A activity);
Consolidated net sales of automotive products of ¥700 billion to ¥1 trillion;
Consolidated operating profit ratio of at least 15%;
ROE (return on shareholders' equity) of at least 18% (assuming shareholders' equity to total assets of 60%);
Establishment of a five-pronged global business management system
The Nidec Group's mid- to long-term business strategies
To achieve the targets set forth in our new medium-term strategic target, the Nidec Group, acting based on "its organic growth strategy" and "M&A strategy" strives to enhance and expand its business portfolio and achieve more uniformity among the group companies.
We are currently shifting from our current business portfolio to an improved and expanded business portfolio consisting of four core business lines, namely "small precision motors," "appliance, commercial and industrial motor products," "automotive products" and "other products," and have launched in the fiscal year ending March 31, 2013, a business enhancement system through which we aim to promote a market-oriented approach for each area of operation, particularly in terms of formulating new strategic ideas and operational implementation.
To strengthen the group's advanced R&D structures, we intend to develop new business and shift to an improved and expanded business portfolio under the leadership of our Chief Technology Officer while actively interacting with external research institutions. Taking advantage of our core technologies, we seek to realize innovation and achieve growth by exploring the market with high value-added products developed by our group's unique technology and pursuing Technology Application Development to cultivate new market demand.
As a critical part of the growth strategy of the Nidec Group, we plan to continue to actively seek M&A opportunities as we aim to achieve growth quickly and efficiently. In the fiscal year ended March 31, 2017, we successfully acquired companies formerly E.C.E. S.r.l., ANA IMEP S.A. (currently, Nidec Motor Corporation Romania), Canton Elevator, Inc., the motors, drives, and electric power generation businesses of Emerson Electric Co. (currently, Nidec Leroy-Somer Holding, Nidec Control Techniques Limited, etc.), and Vamco International, Inc..
Furthermore, with the purpose of promoting our production technology and realizing profitable applications of new materials, engineering methods, robots and automation equipment, we established in October 2015 the Nidec Center for Industrial Science, the construction of which began in Kansai Science City from December 2016. We seek
to build a manufacturing system so as to be better able to stay ahead of the global competition while nurturing our manufacturing engineers.
We also established Global Learning Center in Minami-ku in the city of Kyoto in March 2017 aiming to raise the next generation of Nidec employees who will work globally and support the company's global business expansion.
Business environment
In the global economy, while U.S., Europe and Japan continue to enjoy a moderate recovery, China, supported by its domestic demand expansion based on public works projects, is making a steady economic growth, with resource-rich countries like Brazil and Russia on their way to exit the current economic struggle as their commodity markets recover. On the other hand, as competitions in the global market intensify, better and improved competitiveness is essential for the Nidec Group's sustainable growth, which urgently requires us to improve our company's additional values based on new, competitive products and fresh, advanced technologies.
The Nidec Group's challenges
Enhancing the corporate governance system
As the company operates its governance system that includes independent directors from the outside, we plan to have a total of three independent auditors and two directors from the outside for the current fiscal year ending March 31, 2018. In addition, as part of our ongoing efforts to reform the board of directors and further strengthen our corporate governance system.
Building and strengthening the company's global management infrastructure
Nidec as a global company will further enhance its group's business management, accounting and financial reporting, and business information disclosure systems in accordance with global standards..
To secure a global sustainable growth and accelerate the pace of the post-merger integration (PMI) process of companies purchased overseas, we are building a "five-pronged matrix-based business management system" intended to strengthen the foundation of our growth strategy. Specific actions include the establishment and functional expansion of regional management companies, which will be tasked to improve management quality (in the areas of governance, compliance, and internal control), secure good management efficiency (providing
high-quality, low-cost shared services for individual regions), and actively support PMI.
We previously maintained a "federate-style" management system, under which individual group companies maintained a high degree of independence and autonomy in their business operations; however, to address globalization needs, we are shifting towards a "unified group management" increasingly quickly.
The company's Corporate Administration & Internal Audit Department, which is responsible for
group-wide internal controls, has in place a global auditing system to enhance our internal control system based on the experience and know-how gained through the past audits of our financial statements and the implementation of measures to comply with the U.S. Sarbanes-Oxley Act of 2002. We also seek to improve our information disclosure system and policy through enhanced cooperation between a committee responsible for information disclosure and other relevant specialized departments.
Such specialized departments and offices, including the Compliance Office, the Risk Management Office, and the CSR (corporate social responsibility) Promotion Office, also collaborate with one another and other
departments as appropriate. We seek to find ways to create and maintain jobs and otherwise contribute to society based on our basic management policy as a good corporate citizen..
- Basic rationale for selection of accounting standards
Reporting entity
Nidec Corporation (the Company) is a corporation located in Japan, whose shares are listed on the Tokyo Stock Exchange. The registered address of headquarters and principal business offices are available on the Company's website (http://www.nidec.com/en-Global/).
Consolidated Financial Statements as of March 31, 2017 consist of the Company and its consolidated subsidiaries (NIDEC), and shares of associates of NIDEC.
NIDEC mainly designs, develops, produces, and sells products as described below:
Small precision motors, which include spindle motors for hard disk drives, brushless motors, fan motors, vibration motors, brush motors and motor applications.
Automotive, appliance, commercial and industrial products, which includes automotive motors and components, home appliance, commercial and industrial motors and related products.
Machinery, which includes industrial robots, card readers, test systems, pressing machines and power transmission drives.
Electronic and optical components, which include switches, trimmer potentiometers, lens units and camera shutters.
Others, which include services.
Basis of Preparation
Compliance with International Financial Reporting Standards (IFRS)
The consolidated financial statements of NIDEC have been prepared in accordance with IFRS pursuant to the provision of article 93 of Regulations for Consolidated Financial Statements, as the Company meets the criteria of a "Designated IFRS Specified Company" defined under article 1-2 of the regulations.
NIDEC adopts IFRS for the first time this financial year (commencing on April 1, 2016 and ended on March 31, 2017), and so the annual consolidated financial statements for the year are the first ones prepared in conformity with IFRS. The date of transition of NIDEC to IFRS is April 1, 2015. Explanations of how the first time adoption of, and the transition to, IFRS have affected NIDEC's financial position, business results and cash flows are provided in "Note 9. First-Time Adoption of IFRS".
Basis of measurement
The consolidated financial statements have been prepared on a historical cost basis, except for some assets and liabilities, including derivative and other financial instruments measured at fair value.
Presentation currency and level of rounding
The consolidated financial statements are presented in Japanese Yen, which is also the Company's functional currency, and figures are rounded to the nearest million yen, except as otherwise indicated.
Early adoption of new IFRS standards
NIDEC has early adopted IFRS 9 "Financial instruments" (amended in July 2014).
Significant accounting policies
Significant accounting policies are applied to all periods mentioned in the consolidated financial statements, including the consolidated statement of financial position on the transition date of IFRS.
Significant accounting policies are stated in notes to NIDEC's condensed consolidated financial statements for the first quarter of the current fiscal year, covering the period from April 1, 2016 to June 30, 2016.
Significant accounting estimates, judgments and assumptions
The preparation of the consolidated financial statements requires management of NIDEC to make estimates, judgments and assumptions that affect the reported amounts of assets, liabilities, income, expenses and disclosure of contingent assets and liabilities. Actual results may differ from those estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis, and the effects resulting from revisions of accounting estimates are recognized in the period in which the estimates are revised and in future periods affected by the revision.
Judgments and estimates accompanying significant risks that may cause material adjustments to the carrying amounts of assets and liabilities in the current and next fiscal years are the same as those for the condensed consolidated financial statements for the first quarter of the current fiscal year, covering the period from April 1, 2016 to June 30, 2016.
Business Combinations
Pursuant to IFRS 3 "Business Combinations," during the three months ended September 30, 2016, NIDEC completed its valuation of the assets acquired and the liabilities assumed upon the acquisition of KB Electronics, Inc. (merged into Nidec Motor Corporation in March 2016) Consolidated financial statements for the previous fiscal year and condensed quarterly consolidated financial statements for the three months ended March 31, 2016 reflect the revision of the initially allocated amounts of acquisition price as NIDEC finalized the provisional accounting treatment for the business combination. In addition, during the three months ended March 31, 2017, NIDEC completed its valuation of the assets acquired and the liabilities assumed upon the acquisition of E.C.E. S.r. l. and ANA IMEP S.A. (currently, Nidec Motor Corporation Romania) Consolidated financial statements for the condensed quarterly financial data in the fiscal year ended March 31, 2017 reflect the revision of the initially allocated amounts of acquisition price as NIDEC finalized the provisional accounting treatment for the business combination. The assets and liabilities such as the motors, drives and electric power generation businesses of Emerson Electric Co. (currently, Nidec Leroy-Somer Holding and Nidec Control Techniques Limited) which are currently under evaluation have been recorded on NIDEC's consolidated statement of financial position based on preliminary management estimation as of March 31, 2017.
6. Operating Segment Information
Yen in millions
Name
Year ended March 31
Increase or decrease
2016
2017
Amount
Composition ratio
Amount
Composition ratio
Amount
Composition ratio
Net Sales
Nidec Corporation
229,982
％
218,648
％
(11,334)
％
14.1
13.3
(4.9)
Nidec Electronics (Thailand)
131,753
8.1
127,122
7.8
(4,631)
(3.5)
Nidec Singapore
68,935
4.2
53,470
3.3
(15,465)
(22.4)
Nidec (H.K.)
114,785
7.0
133,300
8.1
18,515
16.1
Nidec Sankyo
129,304
7.9
136,161
8.3
6,857
5.3
Nidec Copal
59,366
3.6
46,676
2.8
(12,690)
(21.4)
Nidec Techno Motor
63,542
3.9
67,017
4.1
3,475
5.5
Nidec Motor
225,387
13.7
249,419
15.2
24,032
10.7
Nidec Motors & Actuators
270,166
16.5
266,091
16.2
(4,075)
(1.5)
All others
343,168
21.0
343,826
20.9
658
0.2
Sub-total
1,636,388
100.0
1,641,730
100.0
5,342
0.3
Adjustments and eliminations
(458,098)
－
(442,419)
－
15,679
－
Consolidated total
1,178,290
－
1,199,311
－
21,021
1.8
Operating income(loss)
Nidec Corporation
17,677
％
16,556
％
(1,121)
％
13.5
10.4
(6.3)
Nidec Electronics (Thailand)
18,910
14.5
18,792
11.8
(118)
(0.6)
Nidec Singapore
1,434
1.1
704
0.4
(730)
(50.9)
Nidec (H.K.)
381
0.3
1,698
1.1
1,317
345.7
Nidec Sankyo
15,047
11.5
19,408
12.2
4,361
29.0
Nidec Copal
718
0.5
4,628
2.9
3,910
544.6
Nidec Techno Motor
5,835
4.5
7,879
5.0
2,044
35.0
Nidec Motor
15,611
12.0
21,216
13.4
5,605
35.9
Nidec Motors & Actuators
25,885
19.8
29,572
18.6
3,687
14.2
All others
29,078
22.3
38,425
24.2
9,347
32.1
Sub-total
130,576
100.0
158,878
100.0
28,302
21.7
Adjustments and eliminations
(12,914)
－
(18,547)
－
(5,633)
－
Consolidated total
117,662
－
140,331
－
22,669
19.3
Notes:
The operating segments are the segments of Nidec for which separate financial information is available and for which operating income or loss amounts are evaluated regularly by executive management in deciding how to allocate resources and in assessing performance.
Nidec Leroy-Somer Holding and Nidec Control Techniques Limited which were newly consolidated in February 2017 have been included in the Nidec Motor segment.
Exemptions to retrospective application of IFRS
IFRS 1 stipulates that an entity adopting IFRS for the first time shall apply IFRS retrospectively to prior periods. However, IFRS 1 allows certain exemptions from the retrospective application of certain aspects of IFRS, and accordingly NIDEC has applied the following exemptions:
Business combinations:
IFRS 1 permits an entity not to apply IFRS 3 "Business Combinations" retrospectively to business combinations that occurred prior to the date of transition to IFRS. NIDEC elected to apply this exemption and did not apply IFRS 3 retrospectively to business combinations that occurred before the date of transition to IFRS. As a result, the goodwill recognized prior to the transition date is recorded based on the U.S. GAAP book value of the transition date. NIDEC performed an impairment test on goodwill at the date of transition to IFRS regardless of whether there was any indication that the goodwill may be impaired.
Use of fair value as deemed cost:
IFRS 1 permits an entity to measure items of property, plant and equipment, investment property or intangible assets at the date of transition to IFRS at its fair value and use that fair value as deemed cost at that date. NIDEC elected to use the fair value at the date of transition to IFRS as deemed cost at the date of transition to IFRS for certain items of property, plant and equipment. Further, NIDEC elected to use the cost model for items of property, plant and equipment and intangible assets under IFRS, thus the revaluation model is not applied.
Exchange differences on translating foreign operations:
IFRS 1 permits the cumulative amount of exchange differences on translating foreign operations to be deemed to be zero at the date of transition to IFRS. NIDEC elected to apply this exemption and deemed all cumulative exchange differences on translating foreign operations as zero at the date of transition to IFRS.
Reconciliations
Reconciliation of equity as of the date of transition to IFRS (April 1, 2015)
Recognition and
Yen in millions
U.S. GAAP U.S. GAAP Re-classification
measurement differences, etc.
IFRS Note IFRS
Assets Current assets
Cash and cash equivalents
269,902
-
-
269,902
Assets Current assets
Cash and cash equivalents
-
255,470
-
255,470
Trade and other receivables
Trade note receivable
15,221
(15,221)
-
-
Trade accounts receivable
222,396
(222,396)
-
-
-
262
-
262
D
Other financial assets
-
1,551
-
1,551
Income tax receivables
Inventories
170,874
-
6
170,880
Inventories
Other current assets
50,622
(30,180)
(424)
20,018
Other current assets
Total current assets
729,015
(10,514)
(418)
718,083
Total current assets
Non-current assets
-
342,122
434
342,556
Property, plant, and equipment
Land
47,427
(47,427)
-
-
Buildings
189,742
(189,742)
-
-
Machinery and equipment
430,019
(430,019)
-
-
Construction in progress
33,831
(33,831)
-
-
Accumulated depreciation
(358,897)
358,897
-
-
Goodwill
162,959
-
-
162,959
Goodwill
-
83,931
-
83,931
Intangible assets
-
2,167
-
2,167
Investments accounted for using the equity method
-
21,507
-
21,507
Other investments
Marketable securities and
other securities investments 21,516
(21,516)
-
-
Investments in and
advances to affiliated 2,167 companies
(2,167)
-
-
-
2,274
-
2,274
D
Other financial assets
-
13,869
(3,120)
10,749
B
Deferred tax assets
-
10,010
(4,364)
5,646
Other non-current assets
Other tangible assets 99,561
(99,561)
-
-
Total non-current assets 628,325
10,514
(7,050)
631,789
Total non-current assets
Total assets 1,357,340 - (7,468) 1,349,872 Total assets
U.S. GAAP U.S. GAAP Re-classification
Recognition and measurement
Yen in millions
IFRS Note IFRS
differences, etc.
Liabilities and equity Liabilities and equity
Liabilities Liabilities
Current liabilities Current liabilities
Short-term borrowings 52,401 - - 52,401 Short term borrowings
Current portion of
long-term debt 45,485 - (53) 45,432
Long term debt due within one year
Trade notes and
- 204,328 44 204,372 Trade and other payables
accounts payable
-
2,941
-
2,941
Other financial liabilities
-
5,855
58
5,913
Income tax payables
-
18,583
-
18,583
Provisions
Accrued expenses
33,375
(33,375)
-
-
Other current liabilities
36,689
(5,538)
-
31,151
Other current liabilities
Total current liabilities
362,948
(2,204)
49
360,793
Total current liabilities
194,998 (194,998) - -
Long term liabilities Non-current liabilities
Long-term debt
184,612
-
(180)
184,432
Long term debt
-
569
-
569
Other financial liabilities
-
19,565
269
19,834
A
Retirement benefit liabilities
Accrued pension and severance costs
19,576
(19,576)
-
-
-
2,904
-
2,904
Provisions
-
32,721
(9,254)
23,467
B
Deferred tax liabilities
-
3,126
-
3,126
Other non-current liabilities
Other long term liabilities
37,105
(37,105)
-
-
Total long term liabilities
241,293
2,204
(9,165)
234,332
Total non-current liabilities
Total liabilities
604,241
-
(9,116)
595,125
Total liabilities
Equity
Equity
Common stock
77,071
-
-
77,071
Common stock
Additional paid-in capital
105,459
-
2,273
107,732
Additional paid-in capital
Retained earnings
427,641
-
135,146
562,787
C
Retained earnings
-
134,828
(135,900)
(1,072)
A
Other components of equity
Accumulated other
comprehensive income 134,828 (134,828) - - C
Treasury stock (27) - - (27) Treasury stock
Total Nidec Corporation
shareholders' equity
Noncontrolling interests
8,127
- 129
8,256
owners of the parent
Non-controlling interests
Total equity
753,099
- 1,648
754,747
Total equity
Total liabilities and equity
1,357,340
- (7,468)
1,349,872
Total liabilities and equity
744,972 - 1,519 746,491
Total equity attributable to
Notes to reconciliation of equity as of the date of transition to IFRS (April 1, 2015)
The major items of the reconciliation of equity as of the date of transition to IFRS are as follows:
Retirement benefit liabilities
Under U.S. GAAP, the actuarial gain and loss, and prior service costs resulted from defined benefit plan or lump-sum indemnities which incurred during the fiscal year but not recognized as the same periodic pension cost are recognized as accumulated other comprehensive income (loss) by the amount after tax. The amount recognized as accumulated other comprehensive income (loss) is amortized into net periodic pension costs over the certain future periods.
Under IFRS, actuarial gain and loss are recognized in other comprehensive income by the amount after tax and the prior service costs are expensed as incurred. The actuarial gain and loss are transferred from other components of equity to retained earnings directly without going through net profit or loss.
As a result of the factors described above, the amount that was reclassified from accumulated other comprehensive income (loss) to a decrease in "Retained earnings" at the IFRS transition date was ¥2,844 million.
Deferred tax
Under U.S. GAAP, when taxes on intercompany profits arising from transfer of assets between entities within NIDEC were paid by sellers, the taxes were deferred as prepaid expenses (¥4,185 million). Under IFRS, however, these temporary differences are recognized as deferred tax assets using the purchasers' tax rates.
Temporary differences resulting from the transition to IFRS are recognized as additional deferred tax assets and liabilities.
Deferred tax assets and liabilities are offset if a legally enforceable right exists to offset current tax assets with current tax liabilities and the deferred taxes relate to income taxes levied by the same taxation authority on the same taxable entity.
As a result, deferred tax assets and liabilities (net) decreased by ¥6,134 million at the date of transition to IFRS.
Translation adjustment of foreign operations
As noted in (1) above, IFRS 1 permits the cumulative amount of exchange differences on translating foreign operations to be deemed to be zero at the date of transition to IFRS. NIDEC elected to apply this exemption and deemed all cumulative exchange differences on translating foreign operations as zero at the date of transition to IFRS. As a result, translation adjustments reclassified from accumulated other comprehensive income to "Retained earnings" was ¥131,332 million at the date of transition to IFRS.
Reclassification on the consolidated statement of financial position
Certain reclassifications have been made to consolidated statement of financial position to conform to provisions under IFRS. The major reclassifications on consolidated statement of financial position are as follows:
Under U.S. GAAP, deferred tax assets and deferred tax liabilities are presented as current assets/non-current assets and current liabilities/non-current liabilities. Under IFRS, as deferred tax assets and deferred tax liabilities are not allowed to be presented as current assets/current liabilities, all of them are reclassified to non-current assets/non-current liabilities.
Financial assets and financial liabilities are disclosed separately based on a provision for presentation under IFRS.
)Reconciliation of equity as of March 31, 2016
U.S. GAAP U.S. GAAP Re-classification
Recognition and measurement differences, etc.
IFRS Note IFRS
Yen in millions
Assets Current assets
Cash and cash equivalents
305,942
-
-
305,942
Assets Current assets
Cash and cash equivalents
-
251,209
101
251,310
Trade and other receivables
Trade note receivable
16,589
(16,589)
-
-
Trade accounts receivables
218,680
(218,680)
-
-
-
2,010
-
2,010
D
Other financial assets
-
2,063
-
2,063
Income tax receivables
Inventories
170,951
-
(77)
170,874
Inventories
Other current assets
53,150
(30,380)
122
22,892
Other current assets
Total current assets
765,312
(10,367)
146
755,091
Total current assets
Non-current assets
-
347,729
(797)
346,932
Property, plant, and equipment
Land
47,477
(47,477)
-
-
Buildings
190,362
(190,362)
-
-
Machinery and equipment
450,860
(450,860)
-
-
Construction in progress
33,340
(33,340)
-
-
Accumulated depreciation
(374,310)
374,310
-
-
Goodwill
162,963
-
(920)
162,043
E
Goodwill
-
76,859
190
77,049
E
Intangible assets
-
1,896
-
1,896
Investments accounted for using
the equity method
-
15,998
-
15,998
Other investments
Marketable securities and
16,004
other securities investments
(16,004)
-
-
Investments in and
advances to affiliated 1,896 companies
(1,896)
-
-
-
1,804
-
1,804
D
Other financial assets
-
13,554
(2,009)
11,545
B
Deferred tax assets
-
8,724
(4,446)
4,278
Other non-current assets
Other tangible assets 90,568
(90,568)
-
-
Total non-current assets 619,160
10,367
(7,982)
621,545
Total non-current assets
Total assets 1,384,472 - (7,836) 1,376,636 Total assets
U.S. GAAP U.S. GAAP Re-classification
Recognition and measurement differences, etc.
IFRS Note IFRS
Yen in millions
Liabilities and equity Liabilities and equity
Liabilities Liabilities
Current liabilities Current liabilities
Short-term borrowings 81,092 - - 81,092 Short term borrowings
Current portion of long-term debt
82,796 - (19) 82,777
Long term debt due within one year
Trade notes and
- 186,946 44 186,990 Trade and other payables
accounts payable
-
3,192
-
3,192
Other financial liabilities
-
5,831
-
5,831
Income tax payable
-
18,886
-
18,886
Provisions
Accrued expenses
34,948
(34,948)
-
-
Other current liabilities
44,388
(3,832)
335
40,891
Other current liabilities
Total current liabilities
420,478
(1,179)
360
419,659
Total current liabilities
177,254 (177,254) - -
Long term liabilities Non-current liabilities
Long-term debt
136,894
-
(96)
136,798
Long term debt
-
1,029
-
1,029
Other financial liabilities
-
19,158
330
19,488
A
Retirement benefit liabilities
Accrued pension and severance costs
19,169
(19,169)
-
-
-
3,283
54
3,337
Provisions
-
29,989
(7,348)
22,641
B
Deferred tax liabilities
-
2,315
-
2,315
Other non-current liabilities
Other long term liabilities
35,426
(35,426)
-
-
Total long term liabilities
191,489
1,179
(7,060)
185,608
Total non-current liabilities
Total liabilities
611,967
-
(6,700)
605,267
Total liabilities
Equity
Equity
Common stock
87,784
-
-
87,784
Common stock
Additional paid-in capital
116,058
-
2,283
118,341
Additional paid-in capital
Retained earnings
495,761
-
129,407
625,168
C
Retained earnings
-
76,729
(132,888)
(56,159)
A
Other components of equity
Accumulated other comprehensive income
76,729 (76,729) - - C
Treasury stock (12,111) - - (12,111) Treasury stock
Total Nidec Corporation shareholders' equity
Noncontrolling interests
764,221
8,284
- (1,198)
- 62
763,023
8,346
Total equity attributable to owners of the parent
Non-controlling interests
Total equity
772,505
- (1,136)
771,369
Total equity
Total liabilities and equity
1,384,472
- (7,836)
1,376,636
Total liabilities and equity
Notes to reconciliation of equity as of March 31, 2016
The major items of the reconciliation of equity as of March 31,2016 are as follows:
Retirement benefit liabilities
Under U.S. GAAP, the actuarial gain and loss, and prior service costs resulted from defined benefit plan or lump-sum indemnities which incurred during the fiscal year but not recognized as the same periodic pension cost are recognized as accumulated other comprehensive income (loss) by the amount after tax. The amount recognized as accumulated other comprehensive income (loss) is amortized into net periodic pension costs over the certain future periods.
Under IFRS, actuarial gain and loss are recognized in other comprehensive income by the amount after tax and the prior service costs are expensed as incurred. The actuarial gain and loss are transferred from other components of equity to retained earnings directly without going through net profit or loss.
As a result of the factors described above, the amount that was reclassified from accumulated other comprehensive income (loss) to a decrease in "Retained earnings" as of March 31, 2016 was ¥3,847 million.
Deferred tax
Under U.S. GAAP, when taxes on intercompany profits arising from transfer of assets between entities within NIDEC were paid by sellers, the taxes were deferred as prepaid expenses (¥4,111 million). Under IFRS, however, these temporary differences are recognized as deferred tax assets using the purchasers' tax rates.
Temporary differences resulting from the transition to IFRS are recognized as additional deferred tax assets and liabilities.
Deferred tax assets and liabilities are offset if a legally enforceable right exists to offset current tax assets with current tax liabilities and the deferred taxes relate to income taxes levied by the same taxation authority on the same taxable entity.
As a result, deferred tax assets and liabilities (net) decreased by ¥5,635 million as of March 31, 2016.
Translation adjustment of foreign operations
As noted in (1) above, IFRS 1 permits the cumulative amount of exchange differences on translating foreign operations to be deemed to be zero at the date of transition to IFRS. NIDEC elected to apply this exemption and deemed all cumulative exchange differences on translating foreign operations as zero at the date of transition to IFRS. As a result, translation adjustments reclassified from accumulated other comprehensive income to "retained earnings" was ¥131,332 million at the date of transition to IFRS.
Reclassification on the consolidated statement of financial position
Certain reclassifications have been made to consolidated statement of financial position to conform to provisions under IFRS. The major reclassifications on consolidated statement of financial position are as follows:
Under U.S. GAAP, deferred tax assets and deferred tax liabilities are presented as current assets/non-current assets and current liabilities/non-current liabilities. Under IFRS, as deferred tax assets and deferred tax liabilities are not allowed to be presented as current assets/current liabilities, all of them are reclassified to non-current assets/non-current liabilities.
Financial assets and financial liabilities are disclosed separately based on a provision for presentation under IFRS.
Retrospective adjustment on business combinations
During the six months ended September 30, 2016, NIDEC completed some of its valuation of the fair values of the assets acquired and the liabilities assumed upon the acquisition in the previous years. Accordingly, retrospective adjustments are included in "Recognition and measurement differences, etc."
(iii ) Reconciliation of income and comprehensive income for the year ended March 31, 2016
Yen in millions
Recognition and
U.S. GAAP U.S. GAAP Re- measurement IFRS Note IFRS
differences, etc.
Consolidated statement of
Consolidated statement of
income
income
Net sales
1,178,290
-
-
1,178,290
Net sales
Cost of products sold
(908,311)
(131)
(1,511)
(909,953)
A,D
Cost of sales
Gross profit
269,979
(131)
(1,511)
268,337
Gross profit
Selling, general and
(93,463)
(5,580)
346
(98,697)
A
Selling, general and
administrative expenses
administrative expenses
Research and development
(51,978)
-
-
(51,978)
Research and development
expenses
expenses
Operating income
124,538 (5,711)
(1,165)
117,662
Operating profit
- 2,859
(946)
1,913
C
Financial income
- (2,356)
(54)
(2,410)
C
Financial expenses
- 151
-
151
Derivative gain
-
-
(153)
1
-
-
(153)
1
Foreign exchange differences
Equity in net income (loss)
classification
Interest and dividend income
1,913 (1,913) - -
of associates
Interest expense (2,228) 2,228 - -
Foreign exchange (loss)
gain, net
Gain on marketable securities, net
(153) 153 - -
946 (946) - - B
Other, net (5,688) 5,688 - -
Income before income tax
119,328
1
(2,165)
117,164
Profit before income taxes
Income taxes
(26,466)
-
300
(26,166)
Income tax expenses
Equity in net income of
1
(1)
-
-
affiliated companies
Consolidated net income
92,863
- (1,865)
90,998
Profit for the period
Net income attributable to:
Profit attributable to:
Nidec Corporation
91,810
- (1,865)
89,945
Owners of the parent
Noncontrolling interests
1,053
- -
1,053
Non-controlling interests
U.S. GAAP U.S. GAAP Consolidated statement of
comprehensive income Consolidated net income
Pension liability adjustments
Net unrealized gains and losses on securities
Foreign currency translation adjustments
Net gains and losses on derivative instruments
Total other comprehensive income
Total comprehensive income
(Breakdown) Comprehensive income
Re- classification
Recognition and measurement differences, etc.
Yen in millions
IFRS Note IFRS
Consolidated statement of comprehensive income
92,863
-
(1,865)
90,998
(981)
-
40
(941)
A
(3,714)
-
805
(2,909)
B
(54,491)
-
(1,699)
(56,190)
326
-
-
326
-
-
(6)
(6)
(58,860)
-
(860)
(59,720)
34,003
-
(2,725)
31,278
Profit for the period
Remeasurement of defined benefit plans
Fair value movements on FVTOCI equity financial assets
Foreign currency translation adjustments Effective portion of net changes in fair value of cash flow hedges
Fair value movements on FVTOCI debt financial assets
Other comprehensive income for the period, net of taxation Comprehensive income for the period
Comprehensive income attributable to:
(loss) attributable to Nidec Corporation Comprehensive income (loss) attributable to noncontrolling interests
33,711 - (2,728) 30,983 Owners of the parent
292 - 3 295 Non-controlling interests
Notes to reconciliation of income and comprehensive income for the year ended March 31, 2016
The major items of the reconciliation of income and comprehensive income for the year ended March 31, 2016 are as follows:
Retirement benefit liabilities
Under U.S. GAAP, the actuarial gain and loss, and prior service costs resulted from defined benefit plan or lump-sum indemnities which incurred during the fiscal year but not recognized as the same periodic pension cost are recognized as accumulated other comprehensive income (loss) by the amount after tax. The amount recognized as accumulated other comprehensive income (loss) is amortized into net periodic pension costs over the certain future periods.
Under IFRS, actuarial gain and loss are recognized in other comprehensive income by the amount after tax and the prior service costs are expensed as incurred. The actuarial gain and loss are transferred from other components of equity to retained earnings directly without going through net profit or loss.
As a result of the factors described above, retirement benefit costs have increased by ¥378 million on the consolidated statement of income for the year ended March 31, 2016.
Equity financial assets
Under U.S. GAAP, gains and losses from the sales of investment securities and impairment of the securities are recognized through profit or loss. Under IFRS, however, NIDEC adopts IFRS 9 and accordingly any gain or loss arising from a difference between the carrying value and fair value of equity financial assets designated as measured at fair value through other comprehensive income ("FVTOCI equity financial assets") are recognized in other comprehensive income without reclassification.
Reclassifications on the consolidated statement of income
Certain reclassifications are made on the consolidated statement of income in order to comply with the IFRS provisions. The major reclassification on the consolidated statement of income is as follows:
Based on an IFRS provision concerning presentations, the financial income and financial expenses are presented separately.
Retrospective adjustment on business combinations
During the six months ended September 30, 2016, NIDEC completed some of its valuation of the fair values of the assets acquired and the liabilities assumed upon the acquisition in the previous years. Accordingly, retrospective adjustments are included in "Recognition and measurement differences, etc."
(iv) Disclosure of material items of reconciliation of the consolidated statements of cash flows for the year ended March 31, 2016
There are no material differences between the consolidated statement of cash flows presented under IFRS and the consolidated statement of cash flows presented under U.S. GAAP.
5. Others (unaudited)
Changes in Directors
Proposed changes regarding Representative Directors Not applicable.
Proposed changes regarding other Members of the Board of Directors and Audit & Supervisory Board Members
Candidates to the Board of Directors (effective as of June 16, 2017): Hiroyuki Yoshimoto (current post: Executive Vice President) Tetsuo Onishi (current post: Executive Vice President)
Candidate to the Audit & Supervisory Board (effective as of June 16, 2017): Kazuya Murakami (current post: Vice President)
Note: Mr. Kazuya Murakami is expected to assume office as a Fulltime Member of the Audit & Supervisory Board as of the above date.
Outgoing Audit & Supervisory Board Member (effective as of June 16, 2017): Tetsuo Inoue (current post: Fulltime Member of the Audit & Supervisory Board)
Note: Mr. Tetsuo Inoue is expected to assume office as a Non-fulltime Executive Consultant as of the above date.
(2) Condensed Quarterly Consolidated Statements of Income
and Condensed Quarterly Consolidated Statements of Comprehensive Income
For the three months ended March 31, 2016 and 2017
Condensed Quarterly Consolidated Statements of Income
Three months ended March 31
Increase or decrease
2016
2017
Amounts
%
Amounts
%
Amounts
%
Net sales Cost of sales
Gross profit
Selling, general and administrative expenses Research and development expenses
Operating profit
Financial income Financial expenses Derivative gain
Foreign exchange differences
Share of net profit (loss) from associate accounting using the equity method
Profit before income taxes Income tax expenses Profit for the period
Profit for the period attributable to: Owners of the parent
Non-controlling interests
Profit for the period
Yen in millions
282,937
(218,029)
100.0
Yen in millions
331,083
(253,707)
100.0
Yen in millions
48,146
(35,678)
17.0
(77.1)
(76.6)
16.4
64,908
22.9
77,376
23.4
12,468
19.2
(25,261)
(8.9)
(29,171)
(8.8)
(3,910)
15.5
(12,271)
(4.3)
(14,047)
(4.3)
(1,776)
14.5
27,376
9.7
34,158
10.3
6,782
24.8
606
0.2
1,092
0.3
486
80.2
(1,109)
(0.4)
(1,252)
(0.4)
(143)
12.9
(10)
(0.0)
(841)
(0.2)
(831)
-
(2,163)
(0.8)
1,366
0.4
3,529
-
(3)
(0.0)
8
0.0
11
-
24,697
8.7
34,531
10.4
9,834
39.8
(4,262)
(1.5)
(4,176)
(1.2)
86
(2.0)
20,435
7.2
30,355
9.2
9,920
48.5
20,419
7.2
30,104
9.1
9,685
47.4
16
0.0
251
0.1
235
-
20,435
7.2
30,355
9.2
9,920
48.5
Condensed Quarterly Consolidated Statements of Comprehensive Income
Three months ended March 31
Increase or decrease
2016
2017
Amounts
Amounts
Amounts
%
Profit for the period
Other comprehensive income, net of taxation
Items that will not be reclassified to net profit or loss:
Remeasurement of defined benefit plans
Fair value movements on FVTOCI equity financial assets Items that may be reclassified to net profit or loss:
Foreign currency translation adjustments
Effective portion of net changes in fair value of cash flow hedges
Fair value movements on FVTOCI debt financial assets Total other comprehensive income for the period, net of taxation Comprehensive income for the period
Comprehensive income attributable to: Owners of the parent
Non-controlling interests
Comprehensive income for the period
Yen in millions
20,435
Yen in millions
30,355
Yen in millions
9,920
48.5
(948)
943
1,891
-
(1,748)
327
2,075
-
(41,537)
(18,213)
23,324
-
905
924
19
2.1
2
2
0
0.0
(43,326)
(16,017)
27,309
-
(22,891)
14,338
37,229
-
(22,529)
13,978
36,507
-
(362)
360
722
-
(22,891)
14,338
37,229
-
Quarterly Financial Data for the three months ended December 31, 2016, September 30, 2016 and June 30, 2016
Three months ended
June 30, 2016
September 30, 2016
December 31, 2016
Amounts
%
Amounts
%
Amounts
%
Net sales Operating profit
Profit before income taxes Profit for the period
Profit attributable to owners of the parent
Yen in millions
Yen in millions
Yen in millions
276,206
31,524
29,087
22,251
22,028
100.0
11.4
10.5
8.1
8.0
287,824
37,461
37,187
28,249
28,066
100.0
13.0
12.9
9.8
9.8
304,198
37,188
41,473
31,816
31,523
100.0
12.2
13.6
10.5
10.4
Information by Product Category
Product categories are classified based on similarities in product type, product attributes, and production and sales methods.
Major products of each product category:
Small precision motors: Spindle motors for HDDs, brushless motors, fan motors, vibration motors, brush motors and motor applications, etc.
Automotive, appliance, commercial and industrial products: Automotive motors and components, home appliance, commercial and industrial motors and related products.
Machinery: Industrial robots, card readers, test systems, pressing machines and power transmission drives, etc.
Electronic and optical components: Switches, trimmer potentiometers, lens units and camera shutters, etc.
Others: Services, etc.
NIDEC adopts IFRS for its consolidated financial statements from the fiscal year ending March 31, 2017 and previous period amounts are also presented in accordance with IFRS.
Sales by Geographic Segment
Yen in millions
Year ended March 31, 2016
Year ended March 31, 2017
Increase or decrease
Amounts
%
Amounts
%
Amounts
%
Japan
271,571
23.1%
283,178
23.6%
11,607
4.3%
U.S.A.
197,235
16.7%
208,964
17.4%
11,729
5.9%
Singapore
72,727
6.2%
57,733
4.8%
(14,994)
(20.6)%
Thailand
106,998
9.1%
105,897
8.8%
(1,101)
(1.0)%
Germany
87,502
7.4%
89,574
7.5%
2,072
2.4%
China
293,353
24.9%
293,059
24.5%
(294)
(0.1)%
Others
148,904
12.6%
160,906
13.4%
12,002
8.1%
Total
1,178,290
100.0%
1,199,311
100.0%
21,021
1.8%
Yen in millions
Three months ended March 31, 2016
Three months ended March 31, 2017
Increase or decrease
Amounts
%
Amounts
%
Amounts
%
Japan
66,361
23.5%
74,509
22.5%
8,148
12.3%
U.S.A.
49,649
17.5%
70,899
21.4%
21,250
42.8%
Singapore
14,673
5.2%
13,121
4.0%
(1,552)
(10.6)%
Thailand
26,849
9.5%
28,408
8.6%
1,559
5.8%
Germany
23,017
8.1%
25,674
7.7%
2,657
11.5%
China
62,951
22.3%
74,016
22.4%
11,065
17.6%
Others
39,437
13.9%
44,456
13.4%
5,019
12.7%
Total
282,937
100.0%
331,083
100.0%
48,146
17.0%
Note: The sales are classified by domicile of the seller, and the figures exclude intra-segment transactions.
Sales by Region
Summary of Consolidated Financial Performance
25 April, 2017
Year ended March 31, 2016
Increase or decrease
Year ended March 31, 2017
Three months ended March 31,
2016
Increase or decrease
Three months ended March 31, 2017
Net Sales
Yen in millions
1,178,290
％
1.8
Yen in millions
1,199,311
Yen in millions
282,937
％
17.0
Yen in millions
331,083
Operating profit
117,662
10.0%
19.3
140,331
11.7%
27,376
9.7%
24.8
34,158
10.3%
Profit before income taxes
117,164
9.9%
21.4
142,278
11.9%
24,697
8.7%
39.8
34,531
10.4%
Profit attributable to owners of the parent
89,945
7.6%
24.2
111,721
9.3%
20,419
7.2%
47.4
30,104
9.1%
Earnings per share attributable to owners of the parent -Basic
Yen
303.04
Yen
376.67
Yen 68.84
Yen
101.50
Earnings per share attributable to owners of the parent -Diluted
301.93
376.67
68.84
101.50
Summary of Consolidated Financial Position and Cash Flows
March 31, 2016
March 31, 2017
Total assets
Yen in millions
1,376,636
Yen in millions
1,676,901
Total equity attributable to owners of the parent
763,023
847,285
Ratio of equity attributable to owners of the parent to total asset
％
55.4
％
50.5
Year ended March 31, 2016
Year ended March 31, 2017
Net cash provided by operating activities
Yen in millions
147,659
Yen in millions
129,853
Net cash used in investing activities
(95,377)
(211,476)
Net cash provided by (used in) financing activities
7,775
95,848
Cash and cash equivalents at end of period
305,942
321,580
Dividends
Interim dividend per share
Year-end dividend per share
Annual dividend per share
Year ended March 31, 2016 (actual)
Yen
40.00
Yen
40.00
Yen
80.00
Year ended March 31, 2017 (actual)
40.00
45.00
85.00
Year ending March 31, 2018 (target)
45.00
45.00
90.00
Scope of Consolidation and Application of the Equity Method
NIDEC adopts IFRS for its consolidated financial statements from the first quarter of the fiscal year ended March 31, 2017. Accordingly, the consolidated financial statements for the previous fiscal year and condensed quarterly consolidated financial statements for the year ended March 31, 2016 are also in accordance with IFRS.
The amounts of percentage in "(1) Summary of Consolidated Financial Performance" represent percentage of sales.
Earnings per share attributable to owners of the parent - Basic and - Diluted are calculated based on profit attributable to owners of the parent.
NIDEC finalized the provisional accounting treatment for the business combination in the three months ended September 30, 2016.
NIDEC adopts International Financial Reporting Standards ("IFRS") for its consolidated financial statements instead of U.S. GAAP from the first quarter of the fiscal year ended March 31, 2017. Accordingly, the consolidated financial statements for the fiscal year ended March 31, 2016 are presented in accordance with IFRS for comparative analysis.
Consolidated Operating Results for the Year Ended March 31, 2017 ("this fiscal year"), Compared to the Year ended March 31, 2016 ("the previous year")
Yen in millions
Year ended March 31, 2016 | Year ended March 31, 2017 | Increase or decrease | Increase or decrease ratio | |
Net sales | 1,178,290 | 1,199,311 | 21,021 | 1.8% |
Operating profit | 117,662 | 140,331 | 22,669 | 19.3% |
Operating profit ratio | 10.0% | 11.7% | - | - |
Profit before income taxes | 117,164 | 142,278 | 25,114 | 21.4% |
Profit attributable to owners of the parent | 89,945 | 111,721 | 21,776 | 24.2% |
Consolidated net sales increased 1.8% to ¥1,199,311 million for this fiscal year compared to the previous fiscal year, recording the highest annual net sales in our history. Operating profit increased 19.3% to ¥140,331 million for this fiscal year compared to the previous fiscal year, recording the highest annual operating profit in our history. The average exchange rate between the Japanese yen and the U.S. dollar for this fiscal year was ¥108.38 to the U.S. dollar, which reflected an appreciation of the Japanese yen against the U.S. dollar of approximately 10%, compared to the prior year. The average exchange rate between the Japanese yen and the Euro for this fiscal year was
¥118.79 to the Euro, which reflected an appreciation of the Japanese yen against the Euro of approximately 10% compared to the prior year. The fluctuations of the foreign currency exchange rates had a negative effect on our net sales of approximately ¥107,400 million and our operating profit of approximately ¥16,700 million for this fiscal year compared to the prior year.
Profit before income taxes increased 21.4% to ¥142,278 million for this fiscal year compared to the prior year and profit attributable to owners of the parent increased 24.2% to ¥111,721 million for this fiscal year compared to the prior year, respectively achieving the highest annual profit our history.
Operating Results by Product Category for this fiscal year Compared to the prior year
Small precision motors-
Yen in millions
Year ended March 31, 2016 | Year ended March 31, 2017 | Increase or decrease | Increase or decrease ratio | ||
Net sales of small precision motors | 447,988 | 437,105 | (10,883) | (2.4)% | |
Hard disk drives spindle motors | 207,974 | 191,074 | (16,900) | (8.1)% | |
Other small precision motors | 240,014 | 246,031 | 6,017 | 2.5% | |
Operating profit of small precision motors | 64,706 | 67,929 | 3,223 | 5.0% | |
Operating profit ratio | 14.4% | 15.5% | - | - | |
Net sales of small precision motors decreased 2.4% to ¥437,105 million for this fiscal year compared to the prior year. The fluctuations of the foreign currency exchange rates had a negative effect on our net sales of small precision motors of approximately ¥38,600 million for this fiscal year compared to the prior year.
Net sales of spindle motors for hard disk drives, or HDDs, for this fiscal year decreased 8.1% to ¥191,074 million compared to the prior year. Although the number of units sold of spindle motors for HDDs remained unchanged compared to the prior year, there were decreases in sales due to a negative effect of the foreign currency exchange rate fluctuations.
Net sales of other small precision motors for this fiscal year increased 2.5% to ¥246,031 million compared to the prior year. This increase was mainly due to increases in sales of other small motors.
Operating profit of small precision motors increased 5.0% to ¥67,929 million for this fiscal year compared to the prior year. The fluctuations of the foreign currency exchange rates had a negative effect on our operating profit of small precision motors of approximately ¥9,100 million for this fiscal year compared to the prior year.
Automotive, appliance, commercial and industrial products-
Yen in millions
Year ended March 31, 2016 | Year ended March 31, 2017 | Increase or decrease | Increase or decrease ratio | ||
Net sales of automotive, appliance, commercial and industrial products | 554,713 | 572,085 | 17,372 | 3.1% | |
Appliance, commercial and industrial products | 283,382 | 310,939 | 27,557 | 9.7% | |
Automotive products | 271,331 | 261,146 | (10,185) | (3.8)% | |
Operating profit of automotive, appliance, commercial and industrial products | 45,797 | 58,085 | 12,288 | 26.8% | |
Operating profit ratio | 8.3% | 10.2% | - | - | |
Net sales of automotive, appliance, commercial and industrial products increased 3.1% to ¥572,085 million for this fiscal year compared to the prior year. The fluctuations of the foreign currency exchange rates had a negative effect on our net sales of automotive, appliance, commercial and industrial products of approximately ¥56,800 million for this fiscal year compared to the prior year.
Net sales of appliance, commercial and industrial products for this fiscal year increased 9.7% compared to the prior year. This increase was primarily due to the newly consolidated subsidiaries acquired in the three months ended March 31, 2017 and the increase in sales through our "Three-new Strategy" (new products, new markets and new clients).
Net sales of automotive products for this fiscal year decreased 3.8% compared to the prior year due to a negative effect of the foreign currency exchange rate fluctuations, although there were increases in sales for automotive motors such as electric power steering motors and products of control valves at Nidec Tosok Corporation.
Operating profit of automotive, appliance, commercial and industrial products increased 26.8% to ¥58,085 million for this fiscal year compared to the prior year mainly due to cost reduction and changes in product mix. The fluctuations of the foreign currency exchange rates had a negative effect on our operating profit of automotive, appliance, commercial and industrial products of approximately ¥6,900 million for this fiscal year compared to the prior year.
Machinery-
Yen in millions
Year ended March 31, 2016 | Year ended March 31, 2017 | Increase or decrease | Increase or decrease ratio | |
Net sales of machinery | 107,811 | 122,341 | 14,530 | 13.5% |
Operating profit of machinery | 15,035 | 21,791 | 6,756 | 44.9% |
Operating profit ratio | 13.9% | 17.8% | - | - |
Net sales of machinery increased 13.5% to ¥122,341 million for this fiscal year compared to the prior year due to the contribution of the newly consolidated companies and the increases in sales of LCD panel or Organic EL handling robots at Nidec Sankyo Corporation, although there was a negative effect of the foreign currency exchange rate fluctuations.
Operating profit of machinery increased 44.9% to ¥21,791 million for this fiscal year compared to the prior year due to the contributions of the newly consolidated companies and the increase in sales of LCD panel or Organic EL handling robots.
Electronic and optical components-
Yen in millions
Year ended March 31, 2016 | Year ended March 31, 2017 | Increase or decrease | Increase or decrease ratio | |
Net sales of electronic and optical components | 64,112 | 64,072 | (40) | (0.1)% |
Operating profit of electronic and optical components | 5,410 | 9,862 | 4,452 | 82.3% |
Operating profit ratio | 8.4% | 15.4% | - | - |
Net sales of electronic and optical components decreased 0.1% to ¥64,072 million and operating profit of electronic and optical components increased 82.3% to ¥9,862 million for this fiscal year compared to the prior year.
Other products-
Yen in millions
Year ended March 31, 2016 | Year ended March 31, 2017 | Increase or decrease | Increase or decrease ratio | |
Net sales of other products | 3,666 | 3,708 | 42 | 1.1% |
Operating profit of other products | 538 | 559 | 21 | 3.9% |
Operating profit ratio | 14.7% | 15.1% | - | - |
Net sales of other products increased 1.1% to ¥3,708 million and operating profit of other products increased 3.9% to ¥559 million for this fiscal year compared to the prior year.
Consolidated Operating Results for the Three Months Ended March 31, 2017 ("this 4Q"), Compared to the Three Months Ended December 31, 2016 ("the previous 3Q")
Yen in millions
Three months ended December 31, 2016 | Three months ended March 31, 2017 | Increase or decrease | Increase or decrease ratio | |
Net sales | 304,198 | 331,083 | 26,885 | 8.8% |
Operating profit | 37,188 | 34,158 | (3,030) | (8.1)% |
Operating profit ratio | 12.2% | 10.3% | - | - |
Profit before income taxes | 41,473 | 34,531 | (6,942) | (16.7)% |
Profit attributable to owners of the parent | 31,523 | 30,104 | (1,419) | (4.5)% |
Consolidated net sales increased 8.8% to ¥331,083 million for this 4Q compared to the previous 3Q. Operating profit decreased 8.1% to ¥34,158 million for this 4Q compared to the previous 3Q.
The average exchange rate between the Japanese yen and the U.S. dollar for this 4Q was ¥113.64 to the U.S.
dollar, which reflected a depreciation of the Japanese yen against the U.S. dollar of approximately 4%, compared to the previous 3Q. The average exchange rate between the Japanese yen and the Euro for this 4Q was ¥121.08 to the Euro, which reflected a depreciation of the Japanese yen against the Euro of approximately 3%, compared to the previous 3Q. The fluctuations of the foreign currency exchange rates had a positive effect on our net sales of approximately ¥8,700 million as well as on our operating profit of approximately ¥900 million for this 4Q compared to the previous 3Q.
Operating profit of spindle motors for HDDs decreased ¥3,800 million due to the decrease of special demands for spindle motors for HDDs for previous 3Q and decreases in shipments caused by a model change of vibration motors, although, operating profit ratio increased 2% to 26% for this quarter compared to previous 3Q.
Also, brand strategy fee was approximately ¥1,000 million, hiring costs was approximately ¥700 million and acquisition fee was approximately ¥600 million due to expense incurred temporarily, and that made the operating profit approximately ¥34,200 million.
Operating Results by Product Category for This 4Q Compared to The previous 3Q
Small precision motors-
Yen in millions
Three months | Three months | Increase or | Increase | ||
ended | ended | or | |||
December 31, | March 31, | decrease | decrease | ||
2016 | 2017 | ratio | |||
Net sales of small precision motors | 119,150 | 106,239 | (12,911) | (10.8)% | |
Hard disk drives spindle motors | 53,674 | 47,034 | (6,640) | (12.4)% | |
Other small precision motors | 65,476 | 59,205 | (6,271) | (9.6)% | |
Operating profit of small precision motors | 19,169 | 15,793 | (3,376) | (17.6)% | |
Operating profit ratio | 16.1% | 14.9% | - | - | |
Net sales of small precision motors decreased 10.8% to ¥106,239 million for this 4Q compared to the previous 3Q. The fluctuations of the foreign currency exchange rates had a positive effect on our net sales of small precision motors of approximately ¥3,200 million for this 4Q compared to the previous 3Q.
Net sales of spindle motors for HDDs decreased 12.4% to ¥47,034 million for this 4Q compared to the previous 3Q. The number of units sold of spindle motors for HDDs for this 4Q decreased approximately 16.0% compared to the previous 3Q due to special demands for previous 3Q.
Net sales of other small precision motors for this 4Q decreased 9.6% to ¥59,205 million compared to the previous 3Q. This was due to a tentative decrease in shipments caused by a model change of vibration motors of other small motors.
Operating profit of small precision motors decreased 17.6% to ¥15,793 million for this 4Q compared to the previous 3Q. The fluctuations of the foreign currency exchange rates had a positive effect on our operating profit of small precision motors of approximately ¥500 million for this 4Q compared to the previous 3Q.
Operating profit ratio of spindle motors for HDDs came to 26% (24% in 3Q) which is improved approximately by 2% due to the rapid cost reduction even though sales volume decreased.
Automotive, appliance, commercial and industrial products-
Yen in millions
Three months ended December 31, 2016 | Three months ended March 31, 2017 | Increase or decrease | Increase or decrease ratio | ||
Net sales of automotive, appliance, commercial and industrial products | 135,064 | 171,376 | 36,312 | 26.9% | |
Appliance, commercial and industrial products | 68,323 | 101,035 | 32,712 | 47.9% | |
Automotive products | 66,741 | 70,341 | 3,600 | 5.4% | |
Operating profit of automotive, appliance, commercial and industrial products | 14,181 | 15,935 | 1,754 | 12.4% | |
Operating profit ratio | 10.5% | 9.3% | - | - | |
Net sales of automotive, appliance, commercial and industrial products increased 26.9% to ¥171,376 million for this 4Q compared to the previous 3Q.
Net sales of appliance, commercial and industrial products for this 4Q increased 47.9% compared to the previous 3Q mainly due to the newly consolidated companies, which were the completion of the acquisition in the three months ended March 31, 2017 and the increase in sales through our "Three-new Strategy" (new products, new markets and new clients).
Net sales of automotive products for this 4Q increased 5.4% compared to the previous 3Q. This increase was due to increases in sales for automotive motors such as electric power steering motors and products of control valves at Nidec Tosok Corporation and the positive effect of the foreign currency exchange rate fluctuations and seasonal factors.
Operating profit of automotive, appliance, commercial and industrial products increased 12.4% to ¥15,935 million for this 4Q compared to the previous 3Q mainly due to the increase in sales.
Operating profit ratio of automotive, appliance, commercial and industrial products is secured more than 10.5% after excluding the effect of the newly consolidated companies' net sales, approximately ¥25,100 million and operating profit, approximately ¥60,000 million.
Machinery-
Yen in millions
Three months ended December 31, 2016 | Three months ended March 31, 2017 | Increase or decrease | Increase or decrease ratio | |
Net sales of machinery | 32,726 | 35,731 | 3,005 | 9.2% |
Operating profit of machinery | 5,601 | 5,990 | 389 | 6.9% |
Operating profit ratio | 17.1% | 16.8% | - | - |
Net sales of machinery increased 9.2% to ¥35,731 million for this 4Q compared to the previous 3Q due to the increase in sales of power transmission drives at Nidec Shimpo Corporation and increase in sales of test systems for smart phones and tablet devices at Nidec Read Corporation.
Operating profit of machinery increased 6.9% to ¥5,990 million for this 4Q compared to the previous 3Q mainly due to increases in sales.
Electronic and optical components-
Yen in millions
Three months ended December 31, 2016 | Three months ended March 31, 2017 | Increase or decrease | Increase or decrease ratio | |
Net sales of electronic and optical components | 16,275 | 16,765 | 490 | 3.0% |
Operating profit of electronic and optical components | 2,904 | 2,080 | (824) | (28.4)% |
Operating profit ratio | 17.8% | 12.4% | - | - |
Net sales of electronic and optical components increased 3.0% to ¥16,765 million for this 4Q compared to the previous 3Q.
Operating profit of electronic and optical components decreased 28.4% to ¥2,080 million for this 4Q compared to the previous 3Q due to loss on disposal of low-use facilities approximately ¥900 million..
Other products-
Yen in millions
Three months ended December 31, 2016 | Three months ended March 31, 2017 | Increase or decrease | Increase or decrease ratio | |
Net sales of other products | 983 | 972 | (11) | (1.1)% |
Operating profit of other products | 156 | 116 | (40) | (25.6)% |
Operating profit ratio | 15.9% | 11.9% | - | - |
Net sales of other products decreased 1.1% to ¥972 million for this 4Q compared to the previous 3Q.
3Q.
Operating profit of other products decreased 25.6% to ¥116 million for this 4Q compared to the previous
Cautionary Note Regarding Forward-Looking Statements
This report contains forward-looking statements based on the current expectations, assumptions, estimates and projections of the Nidec Group in light of the information currently available to it. The Nidec Group cannot make any assurances that the expectations expressed in these forward-looking statements will prove to be correct. Actual results could be materially different from and worse than the Nidec Group's expectations as a result of various factors.
(4) Dividend Policy
We uphold shareholder-oriented management and seek to deliver higher technology solutions while offering higher wages in order to achieve higher growth, profitability and share value so as to build long-term, sustainable growth in shareholder value. We also seek to lay out our vision for the future on a regular and timely basis to keep stakeholders informed on how we intend to respond to changing opportunities and challenges as we continue to strive to succeed in our endeavors. Placing importance on regular dividend payments, we seek to increase our dividend payout to around 30% of our consolidated net profit and use reserves to reinforce our management structure, expand our business horizons, and eventually to improve our profitability and shareholder value.
We have determined the year-end dividend to be ¥45.0 per share for the fiscal year ended March 31, 2017. As a result, together with the interim dividend of ¥40.0 per share, the full-year dividend will be ¥85.0 per share. The dividend payout ratio, which is obtained by dividing dividend declared for the year by profit attributable to owners of the parent, for this fiscal year is approximately 22.6%.
Our current dividend forecast for the year ending March 31, 2018 is a full-year dividend of ¥90.0 per share (an interim dividend of ¥45.0 per share and a year-end dividend of ¥45.0 per share.) Based on this forecast, the dividend payout ratio for the fiscal year ending March 31, 2018 that we are aiming to achieve is approximately 21.4.%.
2. Management Policies, Business Environment, and ChallengesNIDEC has adopted International Financial Reporting Standards (IFRS) since the first quarter in the fiscal year ended March 31, 2017 to strengthen the foundation of financial reporting and make it more efficient.
4. Consolidated Financial Statements and Other Information(1) Consolidated Statements of Financial Position
The date of transition to IFRS (April 1, 2015) | March 31, 2016 | March 31, 2017 | Increase or decrease | ||||
Amounts | % | Amounts | % | Amounts | % | ||
Assets | Yen in millions | Yen in millions | Yen in millions | Yen in millions | |||
Current assets | |||||||
Cash and cash equivalents | 269,902 | 305,942 | 321,580 | 15,638 | |||
Trade and other receivables | 255,470 | 251,310 | 348,897 | 97,587 | |||
Other financial assets | 262 | 2,010 | 2,951 | 941 | |||
Income tax receivables | 1,551 | 2,063 | 1,676 | (387) | |||
Inventories | 170,880 | 170,874 | 197,283 | 26,409 | |||
Other current assets | 20,018 | 22,892 | 28,342 | 5,450 | |||
Total current assets | 718,083 | 53.2 | 755,091 | 54.9 | 900,729 | 53.7 | 145,638 |
Non-current assets | |||||||
Property, plant, and equipment | 342,556 | 346,932 | 394,051 | 47,119 | |||
Goodwill | 162,959 | 162,043 | 260,183 | 98,140 | |||
Intangible assets | 83,931 | 77,049 | 77,215 | 166 | |||
Investments accounted for using the equity method | 2,167 | 1,896 | 1,125 | (771) | |||
Other investments | 21,507 | 15,998 | 19,583 | 3,585 | |||
Other financial assets | 2,274 | 1,804 | 3,764 | 1,960 | |||
Deferred tax assets | 10,749 | 11,545 | 15,526 | 3,981 | |||
Other non-current assets | 5,646 | 4,278 | 4,725 | 447 | |||
Total non-current assets | 631,789 | 46.8 | 621,545 | 45.1 | 776,172 | 46.3 | 154,627 |
Total assets | 1,349,872 | 100.0 | 1,376,636 | 100.0 | 1,676,901 | 100.0 | 300,265 |
The date of transition to IFRS (April 1, 2015) | March 31, 2016 | March 31, 2017 | Increase or decrease | ||||
Amounts | % | Amounts | % | Amounts | % | ||
Liabilities | Yen in millions | Yen in millions | Yen in millions | Yen in millions | |||
Current liabilities | |||||||
Short term borrowings | 52,401 | 81,092 | 166,606 | 85,514 | |||
Long term debt due within one year | 45,432 | 82,777 | 84,040 | 1,263 | |||
Trade and other payables | 204,372 | 186,990 | 251,236 | 64,246 | |||
Other financial liabilities | 2,941 | 3,192 | 1,844 | (1,348) | |||
Income tax payables | 5,913 | 5,831 | 6,690 | 859 | |||
Provisions | 18,583 | 18,886 | 25,210 | 6,324 | |||
Other current liabilities | 31,151 | 40,891 | 66,461 | 25,570 | |||
Total current liabilities | 360,793 | 26.7 | 419,659 | 30.5 | 602,087 | 35.9 | 182,428 |
Non-current liabilities | |||||||
Long term debt | 184,432 | 136,798 | 161,785 | 24,987 | |||
Other financial liabilities | 569 | 1,029 | 1,315 | 286 | |||
Retirement benefit liabilities | 19,834 | 19,488 | 22,656 | 3,168 | |||
Provisions | 2,904 | 3,337 | 3,614 | 277 | |||
Deferred tax liabilities | 23,467 | 22,641 | 25,994 | 3,353 | |||
Other non-current liabilities | 3,126 | 2,315 | 2,931 | 616 | |||
Total non-current liabilities | 234,332 | 17.4 | 185,608 | 13.5 | 218,295 | 13.0 | 32,687 |
Total liabilities | 595,125 | 44.1 | 605,267 | 44.0 | 820,382 | 48.9 | 215,115 |
Equit | |||||||
Common stock | 77,071 | 5.7 | 87,784 | 6.4 | 87,784 | 5.2 | - |
Additional paid-in capital | 107,732 | 8.0 | 118,341 | 8.6 | 118,340 | 7.1 | (1) |
Retained earnings | 562,787 | 41.7 | 625,168 | 45.4 | 716,625 | 42.7 | 91,457 |
Other components of equity | (1,072) | (0.1) | (56,159) | (4.1) | (63,321) | (3.8) | (7,162) |
Treasury stock | (27) | (0.0) | (12,111) | (0.9) | (12,143) | (0.7) | (32) |
Total equity attributable to owners of the parent | 746,491 | 55.3 | 763,023 | 55.4 | 847,285 | 50.5 | 84,262 |
Non-controlling interests | 8,256 | 0.6 | 8,346 | 0.6 | 9,234 | 0.6 | 888 |
Total equity | 754,747 | 55.9 | 771,369 | 56.0 | 856,519 | 51.1 | 85,150 |
Total liabilities and equity | 1,349,872 | 100.0 | 1,376,636 | 100.0 | 1,676,901 | 100.0 | 300,265 |
(2) Consolidated Statements of Income
and Consolidated Statements of Comprehensive Income
For the years ended March 31, 2016 and 2017 Consolidated Statements of Income
Year ended March 31 | Increase or decrease | |||||
2016 | 2017 | |||||
Amounts | % | Amounts | % | Amounts | % | |
Net sales Cost of sales Gross profit Selling, general and administrative expenses Research and development expenses Operating profit Financial income Financial expenses Derivative gain Foreign exchange differences Share of net profit (loss) from associate accounting using the equity method Profit before income taxes Income tax expenses Profit for the year Profit for the year attributable to: Owners of the parent Non-controlling interests Profit for the year | Yen in millions 1,178,290 (909,953) | 100.0 (77.2) | Yen in millions 1,199,311 (912,715) | 100.0 (76.1) | Yen in millions 21,021 (2,762) | 1.8 0.3 |
268,337 | 22.8 | 286,596 | 23.9 | 18,259 | 6.8 | |
(98,697) (51,978) | (8.4) (4.4) | (93,458) (52,807) | (7.8) (4.4) | 5,239 (829) | (5.3) 1.6 | |
117,662 | 10.0 | 140,331 | 11.7 | 22,669 | 19.3 | |
1,913 (2,410) 151 (153) 1 | 0.2 (0.3) 0.0 (0.0) 0.0 | 3,368 (3,063) 405 1,771 (534) | 0.3 (0.2) 0.0 0.1 (0.0) | 1,455 (653) 254 1,924 (535) | 76.1 27.1 168.2 - - | |
117,164 | 9.9 | 142,278 | 11.9 | 25,114 | 21.4 | |
(26,166) | (2.2) | (29,607) | (2.5) | (3,441) | 13.2 | |
90,998 | 7.7 | 112,671 | 9.4 | 21,673 | 23.8 | |
89,945 1,053 | 7.6 0.1 | 111,721 950 | 9.3 0.1 | 21,776 (103) | 24.2 (9.8) | |
90,998 | 7.7 | 112,671 | 9.4 | 21,673 | 23.8 | |
Consolidated Statements of Comprehensive Income
Year ended March 31 | Increase or decrease | |||
2016 | 2017 | |||
Amounts | Amounts | Amounts | % | |
Profit for the year Other comprehensive income, net of taxation Items that will not be reclassified to net profit or loss: Remeasurement of defined benefit plans Fair value movements on FVTOCI equity financial assets Items that may be reclassified to net profit or loss: Foreign currency translation adjustments Effective portion of net changes in fair value of cash flow hedges Fair value movements on FVTOCI debt financial assets Total other comprehensive income for the year, net of taxation Comprehensive income for the year Comprehensive income for the year attributable to: Owners of the parent Non-controlling interests Comprehensive income for the year | Yen in millions 90,998 | Yen in millions 112,671 | Yen in millions 21,673 | 23.8 |
(941) | 761 | 1,702 | - | |
(2,909) | 2,694 | 5,603 | - | |
(56,190) | (8,319) | 47,871 | - | |
326 | 1,118 | 792 | 242.9 | |
(6) | (0) | 6 | - | |
(59,720) | (3,746) | 55,974 | - | |
31,278 | 108,925 | 77,647 | 248.2 | |
30,983 | 108,024 | 77,041 | 248.7 | |
295 | 901 | 606 | 205.4 | |
31,278 | 108,925 | 77,647 | 248.2 | |
(3) Consolidated Statements of Changes in Equity
For the year ended March 31, 2016
Total equity attributable to owners of the parent | Non- controlling interests | Total equity | ||||||
Common Stock | Additional paid-in capital | Retained earnings | Other components of equity | Treasury stock | Total | |||
As of April 1, 2015 | Yen in millions 77,071 | Yen in millions 107,732 | Yen in millions 562,787 89,945 | Yen in millions | Yen in millions | Yen in millions | Yen in millions 8,256 1,053 (758) | Yen in millions |
(1,072) | (27) | 746,491 | 754,747 | |||||
Comprehensive income | ||||||||
Profit for the year | 89,945 | 90,998 | ||||||
Other comprehensive income | (58,962) | (58,962) | (59,720) | |||||
Total comprehensive income | 10,713 | 10,615 | (23,690) | 3,874 | (12,133) | 30,983 | 295 | 31,278 |
Transactions with owners directly | (12,133) | - | (12,133) | |||||
recognized in equity: | ||||||||
Purchase of treasury stock | ||||||||
Conversion of convertible bonds | 22 | 21,350 | - | 21,350 | ||||
Dividends paid to the owners of the parent | (23,690) | - | (23,690) | |||||
Dividends paid to non-controlling interests | - | (54) | (54) | |||||
Transfer to retained earnings | (3,874) | - | - | - | ||||
Other | (6) | 1 | 27 | 22 | (151) | (129) | ||
As of March 31, 2016 | 87,784 | 118,341 | 625,168 | (56,159) | (12,111) | 763,023 | 8,346 | 771,369 |
For the year ended March 31, 2017
Total equity attributable to owners of the parent | Non- controlling interests | Total equity | ||||||
Common Stock | Additional paid-in capital | Retained earnings | Other components of equity | Treasury stock | Total | |||
As of April 1, 2016 | Yen in millions 87,784 | Yen in millions 118,341 | Yen in millions 625,168 111,721 | Yen in millions | Yen in millions | Yen in millions | Yen in millions 8,346 950 (49) | Yen in millions |
(56,159) | (12,111) | 763,023 | 771,369 | |||||
Comprehensive income | ||||||||
Profit for the year | 111,721 | 112,671 | ||||||
Other comprehensive income | (3,697) | (3,697) | (3,746) | |||||
Total comprehensive income | (1) | (23,728) | (3,464) | (33) | 108,024 | 901 | 108,925 | |
Transactions with owners directly | (33) | - | (33) | |||||
recognized in equity: | ||||||||
Purchase of treasury stock | ||||||||
Dividends paid to the owners of the parent | (23,728) | - | (23,728) | |||||
Dividends paid to non-controlling interests | - | (18) | (18) | |||||
Transfer to retained earnings | 3,464 | - | - | - | ||||
Other | (1) | 1 | (1) | 5 | 4 | |||
As of March 31, 2017 | 87,784 | 118,340 | 716,625 | (63,321) | (12,143) | 847,285 | 9,234 | 856,519 |
(4) Consolidated Statements of Cash Flows
Yen in millions | |||
Year ended March 31 | Increase or decrease | ||
2016 | 2017 | ||
Cash flows from operating activities: Profit for the year Adjustments to reconcile profit for the year to net cash provided by operating activities Depreciation Amortization Gain from sales, disposal or impairment of property, plant and equipment Financial expenses (income) Share of net (profit) loss from associate accounting using the equity method Deferred income taxes Current income taxes Foreign currency adjustments Increase (decrease) in retirement benefit liability Increase in accounts receivable Increase in inventories (Decrease) increase in accounts payable Other, net Interests and dividends received Interests paid Income taxes paid | 90,998 | 112,671 | 21,673 |
55,559 | 50,662 | (4,897) | |
9,391 | 9,038 | (353) | |
(155) | (1,224) | (1,069) | |
420 | (163) | (583) | |
(1) | 534 | 535 | |
2,148 | 831 | (1,317) | |
24,019 | 28,775 | 4,756 | |
(368) | (6,636) | (6,268) | |
217 | (94) | (311) | |
(5,163) | (65,582) | (60,419) | |
(6,176) | (6,870) | (694) | |
(6,897) | 39,229 | 46,126 | |
8,028 | (6,465) | (14,493) | |
1,904 | 3,160 | 1,256 | |
(1,797) | (3,052) | (1,255) | |
(24,468) | (24,961) | (493) | |
Net cash provided by operating activities | 147,659 | 129,853 | (17,806) |
Cash flows from investing activities | (81,898) | (68,718) | 13,180 |
Additions to property, plant and equipment | |||
Proceeds from sales of property, plant and equipment | 1,417 | 1,786 | 369 |
Proceeds from sales or redemption of marketable securities | 1,319 | 237 | (1,082) |
Acquisitions of business, net of cash acquired | (9,665) | (139,862) | (130,197) |
Other, net | (6,550) | (4,919) | 1,631 |
Net cash used in investing activities | (95,377) | (211,476) | (116,099) |
Cash flows from financing activities: | 32,412 | 93,784 | 61,372 |
Increase in short term borrowings | |||
Proceeds from issuance of long term debt | 37,903 | 58,707 | 20,804 |
Repayments of long term debt | (26,210) | (32,782) | (6,572) |
Proceeds from issuance of corporate bonds | - | 50,001 | 50,001 |
Redemption of corporate bonds | - | (50,000) | (50,000) |
Purchase of treasury stock | (12,133) | (33) | 12,100 |
Dividends paid to the owner of the parent | (23,690) | (23,728) | (38) |
Other, net | (507) | (101) | 406 |
Net cash provided by financing activities | 7,775 | 95,848 | 88,073 |
Effect of exchange rate changes on cash and cash equivalents | (24,017) | 1,413 | 25,430 |
Net increase in cash and cash equivalents | 36,040 | 15,638 | (20,402) |
Cash and cash equivalents at beginning of year | 269,902 | 305,942 | 36,040 |
Cash and cash equivalents at end of year | 305,942 | 321,580 | 15,638 |
(5) Notes to Consolidated Financial Statements
Notes Regarding Going Concern Assumption
Not applicable.
Notes to Consolidated Financial Statements
.
7.Earnings per share
The Earnings per share information are as follows:
Profit (loss) attributable to owners of the parent | Weighted-average shares | Earnings per share attributable to owners of the parent | |
Earnings per share attributable to | 89,945 | 296,808 | 303.04 |
owners of the parent -Basic | |||
Effect of dilutive securities | |||
Convertible bonds | (3) | 1,083 | |
Earnings per share attributable to | |||
owners of the parent -Diluted | 89,942 | 297,891 | 301.93 |
For the year ended March 31, 2016
For the year ended March 31, 2017
(Yen in millions) (Thousands of shares) (Yen)
(Yen in millions) (Thousands of shares) (Yen)
Profit (loss) attributable to owners of the parent | Weighted-average shares | Earnings per share attributable to owners of the parent | |
Earnings per share attributable to | 111,721 | 296,599 | 376.67 |
owners of the parent -Basic | |||
Effect of dilutive securities | |||
Convertible bonds | - | - | |
Earnings per share attributable to | |||
owners of the parent -Diluted | 111,721 | 296,599 | 376.67 |
8. Events after the Reporting period A significant borrowing
On April 8, 2017, NIDEC plans to execute borrowing under the decision of the Board of Directors meeting.
1) Purpose of the Loan | A portion of the funds necessary to acquire the motors, drives and electric power generation businesses of Emerson Electric Co. (currently, Nidec Leroy-Somer Holding and Nidec Control Techniques Limited, etc.) |
2) The lender | The Bank of Tokyo-Mitsubishi UFJ, Ltd and Sumitomo Mitsui Banking Corporation |
3) Total amount of the loan | $750 million |
4) Rate of the interest | The aggregate of 0.60% per annum and the London interbank offered rate administered by ICE Benchmark Administration Limited for US Dollars for a period of 6 month. |
5) Execution date | The end of May, 2017 |
6) Repayment date | The end of March, 2022 |
7) Collateral assets or guarantee | None |
A stock purchase agreement of Secop Group (Secop Holding GmbH and other 3 entities), a German Compressor Manufacturer
NIDEC acquired 100% equity shares of Secop Holding GmbH, Secop s.r.o., Secop Compressors (Tianjin) Co. Ltd. and Secop Inc. (herein collectively "Secop") and shareholder loans from Secop Beteillingungs GmbH, a portfolio management company owned by AURELIUS Equity Opportunities SE & Co KGaA (the "Transaction"). For this purpose, NIDEC entered into a stock purchase agreement on April 25, 2017.
1) Purpose | Secop develops, manufactures and sells products of compressors for consumer and commercial type refrigerators. Under the Transaction, our appliance motor business in Global Appliance Division which is our new growth platform with particular focus on appliance, industrial and commercial business improve competitiveness in European market. Through the Transaction, NIDEC is adding compressors to its product portfolio, which allows NIDEC to expand further into refrigeration market. |
2) Payment and funding method and schedule | Acquisition method is to finance the Transaction with debt finance. Closing of the Transaction will be completed at the end of June, 2017. |
3) Purchase Price | €185 million (on enterprise value basis) |
9. First-Time Adoption of IFRS
NIDEC discloses the consolidated financial statements under IFRS for the first time for the fiscal year ending March 31, 2017. The latest consolidated financial statements under accounting principles generally accepted in the United States ("U.S. GAAP") were prepared for the fiscal year ended March 31, 2016 and the date of transition to IFRS is April 1, 2015.
The reconciliations required to be disclosed in the first IFRS financial statements are described in the reconciliations below.
"Re-classification" includes items that do not affect retained earnings and comprehensive income, while "Recognition and measurement, etc." includes items that affect retained earnings and comprehensive income.
Year ended March 31, 2016 Yen in millions
Small precision motors | Automotive, appliance, commercial and industrial products | Machinery | Electronic and optical components | Others | Total | Eliminations/ Corporate | Consolidated | |
Net sales: | 447,988 | 554,713 | 107,811 | 64,112 | 3,666 | 1,178,290 | - | 1,178,290 |
Exteral sales | ||||||||
Intersegment | 2,414 | 5,134 | 11,566 | 4,894 | 1,653 | 25,661 | (25,661) | - |
Total | 450,402 | 559,847 | 119,377 | 69,006 | 5,319 | 1,203,951 | (25,661) | 1,178,290 |
Operating expenses | 385,696 | 514,050 | 104,342 | 63,596 | 4,781 | 1,072,465 | (11,837) | 1,060,628 |
Operating profit | 64,706 | 45,797 | 15,035 | 5,410 | 538 | 131,486 | (13,824) | 117,662 |
Year ended March 31, 2017 Yen in millions
Small precision motors | Automotive, appliance, commercial and industrial products | Machinery | Electronic and optical components | Others | Total | Eliminations/ Corporate | Consolidated | |
Net sales: | 437,105 | 572,085 | 122,341 | 64,072 | 3,708 | 1,199,311 | - | 1,199,311 |
Exteral sales | ||||||||
Intersegment | 2,310 | 5,664 | 9,208 | 5,915 | 1,521 | 24,618 | (24,618) | - |
Total | 439,415 | 577,749 | 131,549 | 69,987 | 5,229 | 1,223,929 | (24,618) | 1,199,311 |
Operating expenses | 371,486 | 519,664 | 109,758 | 60,125 | 4,670 | 1,065,703 | (6,723) | 1,058,980 |
Operating profit | 67,929 | 58,085 | 21,791 | 9,862 | 559 | 158,226 | (17,895) | 140,331 |
Three months ended March 31, 2016 Yen in millions
Small precision motors | Automotive, appliance, commercial and industrial products | Machinery | Electronic and optical components | Others | Total | Eliminations/ Corporate | Consolidated | |
Net sales: | 95,911 | 143,682 | 27,566 | 14,848 | 930 | 282,937 | - | 282,937 |
Exteral sales | ||||||||
Intersegment | 518 | 1,255 | 1,751 | 1,197 | 385 | 5,106 | (5,106) | - |
Total | 96,429 | 144,937 | 29,317 | 16,045 | 1,315 | 288,043 | (5,106) | 282,937 |
Operating expenses | 84,872 | 130,747 | 26,099 | 15,180 | 1,167 | 258,065 | (2,504) | 255,561 |
Operating profit | 11,557 | 14,190 | 3,218 | 865 | 148 | 29,978 | (2,602) | 27,376 |
Three months ended March 31, 2017 Yen in millions
Small precision motors | Automotive, appliance, commercial and industrial products | Machinery | Electronic and optical components | Others | Total | Eliminations/ Corporate | Consolidated | |
Net sales: | 106,239 | 171,376 | 35,731 | 16,765 | 972 | 331,083 | - | 331,083 |
Exteral sales | ||||||||
Intersegment | 556 | 1,362 | 2,789 | 1,619 | 426 | 6,752 | (6,752) | - |
Total | 106,795 | 172,738 | 38,520 | 18,384 | 1,398 | 337,835 | (6,752) | 331,083 |
Operating expenses | 91,002 | 156,803 | 32,530 | 16,304 | 1,282 | 297,921 | (996) | 296,925 |
Operating profit | 15,793 | 15,935 | 5,990 | 2,080 | 116 | 39,914 | (5,756) | 34,158 |
Notes:
Yen in millions
Year ended March 31, 2016 | Year ended March 31, 2017 | Increase or decrease | ||||
Amounts | % | Amounts | % | Amounts | % | |
North America | 230,698 | 19.6% | 231,079 | 19.3% | 381 | 0.2% |
Asia | 600,840 | 51.0% | 592,212 | 49.4% | (8,628) | (1.4)% |
Europe | 152,412 | 12.9% | 164,350 | 13.7% | 11,938 | 7.8% |
Others | 14,452 | 1.2% | 21,557 | 1.8% | 7,105 | 49.2% |
Overseas total | 998,402 | 84.7% | 1,009,198 | 84.2% | 10,796 | 1.1% |
Japan | 179,888 | 15.3% | 190,113 | 15.8% | 10,225 | 5.7% |
Total | 1,178,290 | 100.0% | 1,199,311 | 100.0% | 21,021 | 1.8% |
Yen in millions
Three months ended March 31, 2016 | Three months ended March 31, 2017 | Increase or decrease | ||||
Amounts | % | Amounts | % | Amounts | % | |
North America | 59,678 | 21.1% | 63,969 | 19.3% | 4,291 | 7.2% |
Asia | 135,611 | 47.9% | 154,305 | 46.6% | 18,694 | 13.8% |
Europe | 39,974 | 14.1% | 55,131 | 16.7% | 15,157 | 37.9% |
Others | 4,735 | 1.7% | 7,081 | 2.1% | 2,346 | 49.5% |
Overseas total | 239,998 | 84.8% | 280,486 | 84.7% | 40,488 | 16.9% |
Japan | 42,939 | 15.2% | 50,597 | 15.3% | 7,658 | 17.8% |
Total | 282,937 | 100.0% | 331,083 | 100.0% | 48,146 | 17.0% |
Note: The sales are classified by domicile of the buyer, and the figures exclude intra-segment transactions.
6. Other information (unaudited)
Number of consolidated subsidiaries | 296 |
Number of associates accounted for under the equity method | 6 |
Change from March 31, 2016 | ||
Number of consolidated subsidiaries | (Increase) | 74 |
(Decrease) | 3 | |
Number of associates accounted for under the equity method | (Increase) | 2 |
(Decrease) | - | |
Note:
Consolidated financial statements for the previous fiscal year and condensed quarterly consolidated financial statements for the year
ended March 31, 2016 reflect the revision of the initially allocated amounts of acquisition price as NIDEC finalized the provisional accounting treatment for the business combination.
Nidec Corporation published this content on 25 April 2017 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 25 April 2017 06:52:14 UTC.
Original documenthttp://www.nidec.com/en-Global/ir/news/2017/news0425-02/
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