February 18, 2009 Kyocera Corporation Business Presentation MAKOTO KAWAMURA President and Representative Director
Consolidated Financial Forecast - Year ending March 31, 2009 - (Unit: Yen in billions) Year ended March 31, Year ending March 31, 2008 2009 % change Amount Amount % of net sales % of net sales 1,120.0 100.0 -13.2 Net sales 1,290.4 100.0 25.0 2.2 -83.6 Profit from operations 152.4 11.8 40.0 3.6 -77.1 Pre-tax income 174.8 13.5 20.0 1.8 -81.4 Net income 107.2 8.3 105.80 - -81.3 EPS (diluted - yen) 565.80 - 63.0 5.6 -26.0 Capital expenditures 85.1 6.6 84.5 7.5 11.8 Depreciation 75.6 5.9 69.0 6.2 12.0 61.6 4.8 R&D expenses Average exchange rate (yen) US$ ： ¥100 €: ¥143 US$： ¥114 € ： ¥162 ¥ -97.0 billion Foreign currency ¥ 5.9 billion net sales fluctuation effect on: pre-tax (compared with the previous ¥ -24.0 billion ¥ 7.5 billion income fiscal year) 1 Please refer to forward-looking statements on the final page.
Business Environment Outlook from Q4 in FY3/09 Onward ・ Yen appreciation against U.S. dollar and Euro will continue ・ Recovery in stagnant demand is uncertain due to global economic downturn ・ Negative growth is expected in production of key electronic equipment such as mobile phone handsets, which were driving component demand Forecast for Production Volume of Key Electronic Equipment in CY09 Kyocera forecasts (Millions of units) Mobile Phone Handsets PCs Digital Cameras 1 , 4 0 0 3 5 0 1 4 0 Approx. 1,290 Approx. 125 Approx. 295 1 , 2 0 0 3 0 0 1 2 0 -5% Flat 2 5 0 1 0 0 1 , 0 0 0 -5% 8 0 0 2 0 0 8 0 1 5 0 6 0 6 0 0 4 0 0 1 0 0 4 0 2 0 0 5 0 2 0 0 0 0 CY04 05 06 07 08 09 Forecast CY04 05 06 07 08 09 Forecast CY04 05 06 07 08 09 Forecast 2 Please refer to forward-looking statements on the final page.
Kyocera Group Management Challenges Measures to rapidly Measures to increase profit Measures to rapidly Measures to increase profit improve profitability when demand recovers improve profitability when demand recovers � Promote comprehensive cost � Strengthen foundations in reduction core businesses � Reorganize business structures � Grasp further business opportunities 3 Please refer to forward-looking statements on the final page.
Measures to Improve Profitability (1) Promote comprehensive cost reduction Promote comprehensive cost reduction � Reduce capital expenditures Trend of FY09/3 Capital Expenditures ・ FY3/09 Forecast: FY3/09 Forecast: ¥ ¥ 63 billion, 63 billion, ・ ・ FY3/09 Forecast: ¥ 63 billion, (billion) ¥ - ¥ -22 billion compared with FY3/08 22 billion compared with FY3/08 ¥ -22 billion compared with FY3/08 20.0 19.0 ・ FY3/10 Plan: Approx. FY3/10 Plan: Approx. ¥ ¥ 30 30- -40 billion 40 billion ・ 18.2 ・ FY3/10 Plan: Approx. ¥ 30-40 billion 18.0 10.0 7.8 0.0 Q1 Q2 Q3 Q4 Decrease in Depreciation (forecast) FY3/10 Plan on a non- -consolidated basis: consolidated basis: FY3/10 Plan on a non FY3/10 Plan on a non-consolidated basis: Approx. ¥ ¥ - -20 billion compared with 20 billion compared with Approx. Approx. ¥ -20 billion compared with FY3/09 FY3/09 FY3/09 4 Please refer to forward-looking statements on the final page.
Measures to Improve Profitability (2) Improve Profitability and Expand Market Share Improve Profitability and Expand Market Share in the Telecommunication Equipment Group in the Telecommunication Equipment Group Utilize Management Resources / Pursue Group Synergy Utilize Management Resources / Pursue Group Synergy Strengthen production Strengthen production Strengthen production ・ Promote optimization system system ・ Reduce costs system Strengthen sales and Strengthen sales and Strengthen sales and Consolidate R&D Consolidate R&D Consolidate R&D marketing system marketing system marketing system system system system ・ Develop new products on a timely manner ・ Strengthen customer relationship ・ Enhance new product planning ・ Enhance services ・ Reduce costs 5 Please refer to forward-looking statements on the final page.
Measures to Increase Sales and Profit (1) Strengthen Foundations in Core Businesses Expand share of solar energy business Expand share of solar energy business ・ Execute ongoing capital expenditures to expand production capacity ・ Further enhance conversion efficiency ⇒ Overcome global competition Boost sales in the Information Equipment Group Boost sales in the Information Equipment Group ・ Expand business through establishing new structures in R&D, manufacturing and marketing ⇒ Achieve growth for sales and profit in FY3/10 onward 6 Please refer to forward-looking statements on the final page.
Expand Share of Solar Energy Business Market Outlook Market Outlook Market Outlook ・ Demand will slow due to economic downturn, particularly in Europe ・ Market will expand over medium to long term due to tax-cut policy in the U.S. and re-initiation of subsidies in Japan Expand sales and profit by increasing market share Expand sales and profit by increasing market share Kyocera’s Plan for Production of Solar Cells Global Market Scale of Solar Cells 5,000 Planned Europe completion of Production 650 MW Yasu Plant (MW) U.S. Japan Planned start of Asia&Others production of back 550 MW contact solar cells 2,500 400 MW 18.5 % 300 MW 17.5 % Conversion efficiency 16.5 % 0 FY 3/08 3/09 3/10 3/11 3/12 FY 3/09 (Plan) 3/10 (Plan) Planned 7 Please refer to forward-looking statements on the final page.
Boost Sales in the Information Equipment Group (1) Strengthened business structures in FY3/09 Strengthened business structures in FY3/09 R&D Manufacturing Sales and marketing Established a R&D Optimized production Acquired sales channel Center bases and introduced new brand � Concentrate R&D bases � China: Hardware � Conversion of TA ⇒ ・ Reduce R&D cost Japan: Toner Triumph-Adler into a ・ Streamline R&D ⇒ ・ Reduce subsidiary manufacturing costs � Strengthen R&D of ・ Improve productivity � Launch new brand platforms such as color "TASKalfa" engine and controller, � Commenced mass- and color toners production of color toner at a new plant 8 Please refer to forward-looking statements on the final page.
Boost Sales in the Information Equipment Group (2) Conversion of TA Triumph-Adler Launch new brand “TASKalfa” into a subsidiary ⇒ Penetrate “TASKalfa” brand of ⇒ Establish direct-sales system, MFPs in addition to ECOSYS Strengthen solution-based sales printer brand Outline of TA Triumph-Adler Features of TASKalfa � CY08 (nine-month results) Sales: € 298.5 million Pre-tax income: € 19.0 million � Sales by geography (CY07) Europe, Africa, Middle East 30 ％ Germany 70 % � Bases: 65 (60 in Germany) � Newly developed micro-particle � Sales regions: 33 countries toner � Uniquely developed new Customer base: Over 35,000 companies software platform 9 Please refer to forward-looking statements on the final page.
Measures to Increase Sales and Profit (2) Grasp Further Business Opportunities Expand products in environment and energy-related Expand products in environment and energy-related markets markets ・ Increase sales in markets with growth potential Expand into next-generation high-speed wireless Expand into next-generation high-speed wireless communications market communications market ・ Increase sales of communication systems equipment business, such as LTE (long-term evolution) -related products 10 Please refer to forward-looking statements on the final page.
Trend of Sales of Environment and Energy-related Products 11 % 28 % 22 % FY 3/09 FY 3/04 (forecast) FY 3/99 ECOSYS/TASKalfa SOFCs Solar Photovoltaic ECOSYS/TASKalfa SOFCs Solar Photovoltaic (Under development) Systems (Under development) Systems Amorphous Piezoelectric-Stacks Packages Sapphire Substrates Amorphous Piezoelectric-Stacks Packages Sapphire Substrates Silicon Drums for Diesel Engines for LEDs for LEDs Silicon Drums for Diesel Engines for LEDs for LEDs 11 8 Please refer to forward-looking statements on the final page.
Expand into Next-Generation High-Speed Wireless Communications Market Enhance Profitability in the Telecommunication Equipment Group Enhance Profitability in the Telecommunication Equipment Group Enhance Profitability in the Telecommunication Equipment Group Develop base stations and terminals for next-generation high-speed wireless communications market Business opportunities: Start new services Next- Next -generation generation WiMAX WiMAX LTE LTE PHS PHS WILLCOM Inc. UQ Communications Inc. KDDI Corp. WILLCOM Inc. UQ Communications Inc. KDDI Corp. 12 Please refer to forward-looking statements on the final page.
Kyocera Group Management Challenges Drive Growth and Boost Profitability Drive Growth and Boost Profitability Drive Growth and Boost Profitability Measures to rapidly Measures to increase profit Measures to rapidly Measures to increase profit improve profitability when demand recovers improve profitability when demand recovers � Promote comprehensive cost � Strengthen foundations in reduction core businesses � Reorganize business structures � Grasp further business opportunities 13 Please refer to forward-looking statements on the final page.
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