April 27, 2012
Tokyo, April 27, 2012 — Fujitsu today reported consolidated net income of 42.7 billion yen (US$521 million) for fiscal 2011 (April 1, 2011 – March 31, 2012). This was 7.7 billion yen higher than consolidated projections revised and announced in January 2012. Operating income also topped projections, by 5.3 billion yen, thanks to cost cutting measures and streamlining efforts.
Consolidated net sales for fiscal 2011 were 4,467.5 billion yen (US$54,482 million), a decline of 1.3% from fiscal 2010. Excluding the impact of foreign exchange fluctuations, however, sales were on par with the prior fiscal year. Net sales in Japan were essentially unchanged from the previous fiscal year. Sales of car audio and navigation systems, as well as LSI devices, were negatively affected by customer-side production adjustments as a result of the floods in Thailand. In addition, sales of LSI devices and electronic components were hit by weak demand, and server-related sales were lower as a result of fewer large-scale systems deals. The spreading popularity of smartphones, however, boosted sales of network products, such as mobile phone base stations, and sales of mobile phones, themselves. Sales outside of Japan fell by 5.1%. Excluding the impact of foreign exchange fluctuations, however, sales were essentially unchanged from the prior fiscal year. Sales of UNIX servers in Europe and North America and sales of electronic components declined, although sales of PCs rose, particularly in emerging market countries in the EMEA region.
Operating income fell below the fiscal 2010 level by 27.2 billion yen, amounting to 105.3 billion yen (US$1,284 million). The operating income margin was 2.4%, a decline of 0.5 of a percentage point from the previous fiscal year. Despite the positive impact of higher sales of network products, income declined as a result of lower sales of LSI devices and electronic components, and higher upfront R&D investments in network products and cloud services.
Income before taxes and minority interests declined from the previous fiscal year by 35.5 billion yen, amounting to 66.7 billion yen. Fujitsu posted business restructuring expenses of 15.1 billion yen on one-time costs associated with the decision to transfer the LSI device business's Iwate Plant and its employees, the decision to restructure the production of car audio and navigation system operations in Japan, and expenses related to the streamlining of services businesses, mainly in Europe and North America. A loss of 7.5 billion yen was also posted on expenses associated with damage to factories due to aftershocks of the Great East Japan Earthquake and overhead expenses incurred during production stoppages due to customer-related issues.
On the other hand, taxes declined 18.1 billion yen from fiscal 2010, amounting to 29.9 billion yen. Although tax code revisions raised income tax expenses due to reversal of deferred tax assets, the overall effective tax rate fell as the liquidation of a subsidiary in Europe and a stock transfer executed in line with group reorganization had the effect of lowering tax expenses.
Fujitsu posted net income of 42.7 billion yen (US$521 million). This was higher than the January projections, but represented a decrease of 12.3 billion yen from fiscal 2010.
Fujitsu's President Masami Yamamoto commented by stating, “In the fourth quarter we were able to deliver a solid financial performance with operating profit of 95.0 billion yen after a tumultuous first three quarters during which we were adversely impacted by the Great East Japan Earthquake and Thai floods." He went on to say that fiscal 2012 will be a year in which “the Fujitsu Group returns to a path for stable revenue and profit growth by aggressively pursuing reforms."
For fiscal 2011, Fujitsu decided to pay a year-end dividend of 5 yen per share and annual dividends of 10 yen per share, the same level of dividends paid in fiscal 2010.
Consolidated net sales in the Technology Solutions segment amounted to 2,934.9 billion yen (US$35,791 million), a year-on-year decline of 2.6%. The segment posted operating income of 171.2 billion yen (US$2,088 million), a year-on-year increase of 8.4 billion yen owing to higher sales of network products in Japan and improved profitability in the European services business.
Net sales in the Ubiquitous Solutions segment were 1,154.2 billion yen (US$14,076 million), an increase of 2.5% compared to fiscal 2010. Operating income amounted to 19.9 billion yen, a decrease of 2.7 billion yen from the previous fiscal year. The segment experienced price erosion of PCs, increased HDD procurement costs, increased smart phone development costs and lower sales of car audio and navigation systems.
Net sales in Device Solutions amounted to 584.7 billion yen (US$7,130 million), a decline of 7.3% compared to fiscal 2010. The segment recorded an operating loss of 10.1 billion yen (US$123 million), representing a deterioration of 31.1 billion yen from fiscal 2010. Contributing factors included a decline in LSI device sales caused by weak demand, and subsequently, lower capacity utilization rates, as well as lower sales of electronic components, for which costs associated with certain materials soared.
Fujitsu has made its full-year financial projections for fiscal 2012, as presented below.
For fiscal 2012, the company again plans to pay an annual dividend of 10 yen per share, which includes an interim dividend of 5 yen.
* Yen figures have been converted to U.S. dollars, for convenience only, at a uniform rate of US$1 = 82 yen, the approximate closing rate on March 31, 2012.
Fujitsu is the leading Japanese information and communication technology (ICT) company offering a full range of technology products, solutions and services. Over 170,000 Fujitsu people support customers in more than 100 countries. We use our experience and the power of ICT to shape the future of society with our customers. Fujitsu Limited (TSE:6702) reported consolidated revenues of 4.5 trillion yen (US$54 billion) for the fiscal year ended March 31, 2012. For more information, please see:http://www.fujitsu.com.
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