Oki Electric Revises Projections
August 30, 2001, Tokyo, Japan -- Oki Electric Industry Co., Ltd. today
announced that it has revised its profit/loss (P/L) projections for the first
half of FY2001 ending September 30, 2001.
- Revised P/L Projections for interim period ending September 30, 2001 (Consolidated)
| (April 1, 2001 - September 30, 2001)
|
| [Units: Millions of yen, percent] |
| |
Net Sales |
Recurring
Income (loss) |
Net
Income (loss) |
Earlier projections (A)
* Announced April 26, 2001 |
325,000 |
7,000 |
2,000 |
| Revised projections (B) |
290,000 |
(5,000) |
(3,000) |
Increase (decrease) in value
(B-A) |
(35,000) |
(12,000) |
(5,000) |
| Increase (decrease) in percent |
(10.8) |
- |
- |
For term ended
September 30, 2000 |
311,305 |
3,733 |
2,013 |
The above projections do not include possible write down
losses of certain securities with quoted market prices. If the quoted market prices
of such securities are below 50% of their respective acquisition costs as of the
end of the interim period, September 30, 2001, Oki Electric will write down the
acquisition costs to their market prices. Hypothetically using the quotes of last
trade on the Tokyo Stock Exchange as of August 29, 2001, the write down losses
and net loss for the interim period would be 11.8 billion yen and 10.0 billion
yen, respectively.
As of August 29, 2001, unrealized holding gains and losses on securities with
quoted market prices were 12.3 billion yen and 14.4 billion yen, respectively.
The aforementioned possible write down losses are included in the unrealized holding
losses. |
Supplementary information of the Revised P/L
Projection for interim period ending September 30, 2001
- Revised P/L Projections for interim period ending September 30, 2001 (Unconsolidated)
| (April 1, 2001 - September 30, 2001) |
| [Units: Millions of yen, percent] |
| |
Net Sales |
Recurring
Income (loss) |
Net
Income (loss) |
Earlier projections (A)
* Announced April 26, 2001 |
235,000 |
9,500 |
4,500 |
| Revised projections (B) |
200,000 |
(1,500) |
1,000 |
Increase (decrease) in value
(B-A) |
(35,000) |
(11,000) |
(3,500) |
| Increase (decrease) in percent |
(14.9) |
- |
(77.8) |
For term ended
September 30, 2000 |
227,537 |
6,133 |
5,802 |
The above projections do not include possible write down
losses of certain securities with quoted market prices. If the quoted market prices
of such securities are below 50% of their respective acquisition costs as of the
end of the interim period, September 30, 2001, Oki Electric will write down the
acquisition costs to their market prices. Hypothetically using the quotes of last
trade on the Tokyo Stock Exchange as of August 29, 2001, the write down losses
and net loss for the interim period would be 11.8 billion yen and 6.0 billion
yen, respectively.
As of August 29, 2001, unrealized holding gains and losses on securities with
quoted market prices were 12.2 billion yen and 14.3 billion yen, respectively.
The aforementioned possible write down losses are included in the unrealized holding
losses. |
- Projections of Consolidated and Unconsolidated Operating Results for Term
Ending March 31, 2002
In view of the current prospects for market changes in relation to projections
of consolidated and unconsolidated operating results for the term ending March
31, 2002, it will be extremely difficult to recover the projected losses in the
second half of FY2001. Final projections are expected to be announced in mid-September.
- Reasons for Revision of Projections
IT investments that supported the global economy in recent years have declined
rapidly, and slowdowns in the sales of personal computers and cellular phones,
both of which had pushed private consumption, have caused the semiconductor market
to decline on an unprecedented scale. In addition, telecommunications carriers
in North America have begun to rationalize their inventories in order to compensate
for the excessive investments they made in the past. Domestic carriers are also
controlling their investments in response to decreased incomes from communications
fees. Furthermore, the introduction of ADSL service has drastically reduced the
number of ISDN service subscribers, and the demand for ISDN switching systems
has plummeted.
Oki Electric's Electronic Devices division has withdrawn from the generic
PC DRAM business and is focusing on logical system LSIs in order to make itself
less vulnerable to demand fluctuations in the semiconductor market. Although profits
from sales have been secured, operating results have been lower than expected.
The Telecommunications Systems division has been allocating its resources
to the broadband IP-network field. Although sales in this area are expected to
grow rapidly, they are not likely to compensate for the slump in sales of ISDN
switching systems.
- Preparations for Phoenix 21 Sky High Plan
This past March, Oki Electric announced its medium-term business plan, titled
Phoenix 21 Sky High, for FY2002 to FY2005. This plan succeeds the Phoenix 21 plan.
FY2001 is the final year of Phoenix 21 and is also the year to prepare for
the launch of Phoenix 21 Sky High.
Although Phoenix 21 has produced solid results from the start, Oki Electric
has developed preparatory measures for Phoenix 21 Sky High in order to adapt to
ongoing dramatic changes in the market. Phoenix 21 Sky High will be implemented
speedily in order to achieve its goals and maximize the corporate value of Oki
Electric.
<Appendix>
"Phoenix 21-Sky High" Medium-Term Business Plan: Status Report [623KB]
[Reference]
Targets of Phoenix 21 Sky High Plan
| |
FY2000 Results |
FY2005 Targets |
| ROE (consolidated) |
6% |
12% |
Net profit
(consolidated) |
740.2 billion yen |
1 trillion yen |
D/E ratio
(consolidated) |
2.4 |
1.3 |
Note: Please note that the projections, prospects, and targets mentioned
above are based on current conditions in the business environment, and that actual
results might differ, depending on future developments.
Press Contact:
Public Relations Division
Phone: +81-3-3580-8950 |
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| Information in the press releases is current on the date of the press announcement, but is subject to change without prior notice. | |
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