REG - Mitsubishi Elect. - Half-year Report
FOR IMMEDIATE RELEASE
No. 3316
Investor Relations Inquiries
Media Inquiries
Investor Relations Group, Corporate Finance Division
Public Relations Division
Mitsubishi Electric Corporation
Mitsubishi Electric Corporation
Cad.Irg@rk.MitsubishiElectric.co.jp
www.MitsubishiElectric.com/news/
Mitsubishi Electric Announces Consolidated Financial Results
for the First Half and Second Quarter of Fiscal 2020
TOKYO, October 31, 2019 - Mitsubishi Electric Corporation (TOKYO: 6503) announced today its consolidated financial results for the first half and second quarter, ended September 30, 2019, of the current fiscal year ending March 31, 2020 (fiscal 2020).
1. Consolidated Half-year Results (April 1, 2019 - September 30, 2019)
Revenue:
2,182.5
billion yen
(1% increase from the same period last year)
Operating profit:
114.2
billion yen
(9% decrease from the same period last year)
Profit before income taxes:
124.0
billion yen
(12% decrease from the same period last year)
Net profit attributable to Mitsubishi Electric Corp. stockholders:
91.2
billion yen
(11% decrease from the same period last year)
The economy in the first half of fiscal 2020, from April through September 2019, saw a slower growth in China, with the corporate sector experiencing a slowdown in exports and capital expenditures for fixed assets. In the U.S., the economy continued to grow due primarily to buoyant personal consumption, but the corporate sector began to slow down mainly in capital expenditures. In addition, the economic recovery became slower in Japan and Europe, with Japan seeing a decrease in production and exports, and Europe experiencing a fall in production.
Under these circumstances, revenue in the first half of fiscal 2020 increased by 1% compared to the same period of the previous fiscal year to 2,182.5 billion yen with increased revenue in the Energy and Electric Systems, Information and Communication Systems, Electronic Devices and Home Appliances segments.
Operating profit decreased by 9% compared to the same period of the previous fiscal year to 114.2 billion yen, due to decreased profits in the Industrial Automation Systems and Electronic Devices segments.
Profit before income taxes decreased by 12% compared to the same period of the previous fiscal year to 124.0 billion yen.
Net profit attributable to Mitsubishi Electric Corporation stockholders decreased by 11% compared to the same period of the previous fiscal year to 91.2 billion yen.
Consolidated Financial Results by Business Segment (First Half, Fiscal 2020)
Energy and Electric Systems
Revenue:
592.1
billion yen
(4% increase from the same period last year which recorded 568.6 billion yen)
Operating profit:
20.4
billion yen
(4.9 billion yen increase from the same period last year which recorded 15.5 billion yen)
The social infrastructure systems business saw increases in both orders and revenue from the same period of the previous fiscal year. This was due primarily to an increase in orders in the power systems business in and outside Japan, and an increase in revenue in the transportation systems business also in and outside Japan.
The building systems business saw orders substantially unchanged, while revenue in this business increased compared to the same period of the previous fiscal year due primarily to an increase in new installations of elevators and escalators in Japan, mainly in the Tokyo metropolitan area.
As a result, revenue for this segment increased by 4% from the same period of the previous fiscal year to 592.1 billion yen. Operating profit increased by 4.9 billion yen from the same period of the previous fiscal year to 20.4 billion yen mainly due to an increase in revenue.
Industrial Automation Systems
Revenue:
686.2
billion yen
(6% decrease from the same period last year which recorded 730.3 billion yen)
Operating profit:
41.2
billion yen
(36.7 billion yen decrease from the same period last year which recorded 77.9 billion yen)
The factory automation systems business saw decreases in both orders and revenue from the same period of the previous fiscal year due primarily to continued stagnation in demand for automotive-related investments worldwide, semiconductor and machinery-related investments in Japan, and investments related to organic light emitting diodes (OLED) and smartphones outside Japan, in addition to impact from the yen appreciating against other currencies.
The automotive equipment business saw decreases in both orders and revenue from the same period of the previous fiscal year mainly due to a decrease in Japan and other markets in Asia and impact from the yen appreciating against other currencies, despite increased sales of electric-vehicle related equipment in response to market growth worldwide.
As a result, revenue for this segment decreased by 6% from the same period of the previous fiscal year to 686.2 billion yen. Operating profit decreased by 36.7 billion yen from the same period of the previous fiscal year to 41.2 billion yen due primarily to a decrease in revenue, a shift in product mix and upfront investment for growth drivers.
Information and Communication Systems
Revenue:
199.0
billion yen
(7% increase from the same period last year which recorded 186.8 billion yen)
Operating profit:
4.7
billion yen
(2.2 billion yen increase from the same period last year which recorded 2.5 billion yen)
The telecommunications systems business saw increases in both orders and revenue compared to the same period of the previous fiscal year due primarily to increased demand for communications infrastructure equipment.
The information systems and service business saw increases in both orders and revenue compared to the same period of the previous fiscal year mainly due to an increase in the system integrations business.
The electronic systems business saw increases in both orders and revenue from the same period of the previous fiscal year. This was due primarily to an increase in orders mainly in large-scale projects for the space systems business, and an increase in revenue in large-scale projects for the defense systems business.
As a result, revenue for this segment increased by 7% compared to the same period of the previous fiscal year to 199.0 billion yen. Operating profit increased by 2.2 billion yen compared to the same period of the previous fiscal year to 4.7 billion yen due primarily to an increase in revenue.
Electronic Devices
Revenue:
103.1
billion yen
(1% increase from the same period last year which recorded 101.8 billion yen)
Operating profit:
1.0
billion yen
(0.2 billion yen decrease from the same period last year which recorded 1.2 billion yen)
The electronic devices business saw an increase in orders, and revenue rose by 1% from the same period of the previous fiscal year to 103.1 billion yen due to an increase in demand mainly for power modules used in automotive and railcar applications.
Operating profit decreased by 0.2 billion yen compared to the same period of the previous fiscal year to 1.0 billion yen due primarily to impact from the yen appreciating against other currencies.
Home Appliances
Revenue:
581.7
billion yen
(4% increase from the same period last year which recorded 557.1 billion yen)
Operating profit:
53.2
billion yen
(19.5 billion yen increase from the same period last year which recorded 33.6 billion yen)
The home appliances business saw an increase in revenue of 4% from the same period of the previous fiscal year to 581.7 billion yen mainly due to an increase in sales of air conditioners for Japan, North America and Europe.
Operating profit increased by 19.5 billion yen compared to the same period of the previous fiscal year to 53.2 billion yen due primarily to an increase in revenue.
Others
Revenue:
316.2
billion yen
(4% decrease from the same period last year which recorded 327.8 billion yen)
Operating profit:
9.5
billion yen
(0.8 billion yen decrease from the same period last year which recorded 10.3 billion yen)
Revenue decreased by 4% compared to the same period of the previous fiscal year to 316.2 billion yen mainly due to a decrease in procurements for the Mitsubishi Electric Group at affiliated companies involved in materials procurement.
Operating profit decreased by 0.8 billion yen compared to the same period of the previous fiscal year to 9.5 billion yen due primarily to a decrease in revenue.
2. Consolidated Second-quarter Results (July 1, 2019 - September 30, 2019)
Revenue:
1131.7
billion yen
(1% increase from the same period last year)
Operating profit:
59.3
billion yen
(8% decrease from the same period last year)
Profit before income taxes:
64.2
billion yen
(11% decrease from the same period last year)
Net profit attributable to Mitsubishi Electric Corp. stockholders:
48.4
billion yen
(11% decrease from the same period last year)
Revenue for this quarter, from July through September 2019, was 1,131.7 billion yen, a 1% increase from the same period of the previous fiscal year, due primarily to increased revenue in the Energy and Electric Systems, Information and Communication Systems, Electronic Devices and Home Appliances segments.
Operating profit was 59.3 billion yen, a decrease of 8% from the same period of the previous fiscal year, with decreased profits in the Industrial Automation Systems and Information and Communication Systems segments.
Profit before income taxes decreased by 11% compared to the same period of the previous fiscal year to 64.2 billion yen.
Net profit attributable to Mitsubishi Electric Corporation stockholders decreased by 11% compared to the same period of the previous fiscal year to 48.4 billion yen.
Consolidated Financial Results by Business Segment (Second Quarter, Fiscal 2020)
Energy and Electric Systems
Revenue:
316.2
billion yen
(5% increase from the same period last year which recorded 301.2 billion yen)
Operating profit:
11.2
billion yen
(1.6 billion yen increase from the same period last year which recorded 9.5 billion yen)
The social infrastructure systems business saw increases in both orders and revenue from the same period of the previous fiscal year. This was due primarily to an increase in orders in the power systems business in Japan and an increase in revenue in the transportation systems business in and outside Japan.
The building systems business saw increases in both orders and revenue compared to the same period of the previous fiscal year due primarily to an increase in new installations of elevators and escalators in Japan, mainly in the Tokyo metropolitan area.
As a result, revenue for this segment increased by 5% from the same period of the previous fiscal year to 316.2 billion yen. Operating profit increased by 1.6 billion yen from the same period of the previous fiscal year to 11.2 billion yen mainly due to an increase in revenue.
Industrial Automation Systems
Revenue:
353.9
billion yen
(4% decrease from the same period last year which recorded 369.3 billion yen)
Operating profit:
20.0
billion yen
(13.0 billion yen decrease from the same period last year which recorded 33.1 billion yen)
The factory automation systems business saw decreases in both orders and revenue from the same period of the previous fiscal year due primarily to continued stagnation in demand for automotive-related investments worldwide, semiconductor and machinery-related investments in Japan, and investments related to organic light emitting diodes (OLED) and smartphones outside Japan, in addition to impact from the yen appreciating against other currencies.
The automotive equipment business saw orders and revenue both substantially unchanged from the same period of the previous fiscal year, with the business experiencing increased sales of electric-vehicle related equipment in response to market growth worldwide, and also impact from the yen appreciating against other currencies.
As a result, revenue for this segment decreased by 4% from the same period of the previous fiscal year to 353.9 billion yen. Operating profit decreased by 13.0 billion yen from the same period of the previous fiscal year due primarily to a decrease in revenue, a shift in product mix and upfront investment for growth drivers.
Information and Communication Systems
Revenue:
112.6
billion yen
(5% increase from the same period last year which recorded 107.0 billion yen)
Operating profit:
3.3
billion yen
(1.0 billion yen decrease from the same period last year which recorded 4.3 billion yen)
The telecommunications systems business saw increases in both orders and revenue compared to the same period of the previous fiscal year due primarily to increased demand for communications infrastructure equipment.
The information systems and service business saw increases in both orders and revenue compared to the same period of the previous fiscal year mainly due to an increase in the system integrations business.
The electronic systems business saw increases in both orders and revenue compared to the same period of the previous fiscal year mainly due to an increase in large-scale projects for the defense systems business.
As a result, revenue for this segment increased by 5% compared to the same period of the previous fiscal year to 112.6 billion yen. Operating profit decreased by 1.0 billion yen from the same period of the previous fiscal year to 3.3 billion yen due primarily to a shift in project portfolios.
Electronic Devices
Revenue:
52.1
billion yen
(3% increase from the same period last year which recorded 50.4 billion yen)
Operating profit:
0.4
billion yen
(0.6 billion yen improvement from the same period last year which recorded a loss of 0.2 billion yen)
The electronic devices business saw an increase in orders, and revenue rose by 3% from the same period of the previous fiscal year to 52.1 billion yen mainly due to an increase in demand for power modules used in automotive and railcar applications and a recovery in demand for certain optical communication devices.
Operating profit improved by 0.6 billion yen compared to the same period of the previous fiscal year to 0.4 billion yen due primarily to an increase in revenue.
Home Appliances
Revenue:
285.7
billion yen
(3% increase from the same period last year which recorded 276.7 billion yen)
Operating profit:
22.0
billion yen
(8.4 billion yen increase from the same period last year which recorded 13.6 billion yen)
The home appliances business saw an increase in revenue of 3% from the same period of the previous fiscal year to 285.7 billion yen mainly due to an increase in sales of air conditioners for Japan, North America and Europe.
Operating profit increased by 8.4 billion yen compared to the same period of the previous fiscal year to 22.0 billion yen due primarily to an increase in revenue.
Others
Revenue:
166.7
billion yen
(3% decrease from the same period last year which recorded 172.1 billion yen)
Operating profit:
7.3
billion yen
(1.8 billion yen decrease from the same period last year which recorded 9.1 billion yen)
Revenue decreased by 3% compared to the same period of the previous fiscal year to 166.7 billion yen mainly due to a decrease in procurements for the Mitsubishi Electric Group at affiliated companies involved in materials procurement.
Operating profit decreased by 1.8 billion yen compared to the same period of the previous fiscal year to 7.3 billion yen due primarily to a decrease in revenue.
Financial Standing
An analysis on the status of assets, liabilities and equity on a consolidated basis
The Mitsubishi Electric Group has applied IFRS 16 Lease from the first quarter of the current fiscal year, thereby, as of the date of the initial application, it has added lease assets of 93.0 billion yen mainly as property, plant and equipment, and liabilities of 95.1 billion yen as bonds, borrowings and lease liabilities. (For details, refer to the 'Changes in Accounting Policies' in 'Notes to the Condensed Consolidated Financial Statements.')
Total assets as of the end of this fiscal quarter increased from the end of the previous fiscal year by 1.7 billion yen to 4,358.0 billion yen. The change in balance of total assets was mainly attributable to increases in property, plant and equipment by 92.4 billion yen and in other current assets by 28.0 billion yen, while trade receivables and contract assets decreased by 116.5 billion yen primarily as a result of credit collection.
Total liabilities decreased from the end of the previous fiscal year by 4.5 billion yen to 1,840.5 billion yen. The outstanding balances of bonds, borrowings and lease liabilities increased by 90.9 billion yen, while trade payables decreased by 53.0 billion yen, and other current liabilities also decreased by 43.9 billion yen. Meanwhile, bonds and borrowings decreased by 0.7 billion yen from the end of the previous fiscal year to 275.2 billion yen, with the ratio of bonds and borrowings to total assets recording 6.3%.
Mitsubishi Electric Corporation stockholders' equity increased by 7.9 billion yen compared to the end of the previous fiscal year to 2,407.9 billion yen. The stockholders' equity ratio was recorded at 55.3%, representing a 0.2 point increase compared to the end of the previous fiscal year. These changes referred to above primarily result from an increase from recording a net profit attributable to Mitsubishi Electric Corporation stockholders of 91.2 billion yen, despite a decrease in dividend payment of 55.8 billion yen and a decrease in accumulated other comprehensive income by 26.6 billion yen mainly reflecting the yen's appreciation against foreign currencies.
An analysis on the status of cash flow on a consolidated basis
Cash flows from operating activities for the first half of fiscal 2020 increased by 70.1 billion yen compared to the same period of the previous fiscal year to 214.4 billion yen (cash in), mainly due to a decrease in payments for inventories. Cash flows from investing activities increased by 16.9 billion yen compared to the same period of the previous fiscal year to 115.6 billion yen (cash out), due primarily to an increase in purchase of property, plant and equipment and purchase of investment securities. As a result, free cash flow was 98.7 billion yen (cash in). Cash flows from financing activities were 87.3 billion yen (cash out) mainly due to dividend payments.
Forecast for Fiscal 2020 (year ending March 31, 2020)
Revenue for fiscal 2020 is expected to fall below the company's previous forecast, due to the Industrial Automation Systems segment experiencing a delay in recovery of the stagnating market demand worldwide, and also due to the revised exchange rates in which the company sees the yen stronger mainly against the euro and Chinese yuan in and after the third fiscal quarter. As a result, the company's consolidated earnings forecast for fiscal 2020, ending March 31, 2020, has been revised from the announcement on July 30, 2019 as stated below.
Consolidated Earnings Forecast for Fiscal 2020
Consolidated
Previous forecast (announced
July 30)Current forecast
Change from previous forecast
Revenue:
4,630.0 billion yen
4,500.0 billion yen
(Unchanged from fiscal 2019)
Down 130.0 billion yen, or 3%
Operating profit:
295.0 billion yen
260.0 billion yen
(10% decrease from fiscal 2019)
Down 35.0 billion yen, or 12%
Profit before income taxes:
320.0 billion yen
275.0 billion yen
(13% decrease from fiscal 2019)
Down 45.0 billion yen, or 14%
Net profit attributable to Mitsubishi Electric Corp. stockholders:
240.0 billion yen
210.0 billion yen
(7% decrease from fiscal 2019)
Down 30.0 billion yen, or 13%
Exchange rates in and after the third quarter of fiscal 2020 is 105 yen to the U.S. dollar, which is unchanged from the previous announcement; 115 yen to the euro, which is 10 yen stronger from the company's previous announcement; and 15.0 yen to the Chinese yuan, which is 1.0 yen stronger.
Note: The results forecast above is based on assumptions deemed reasonable by the company at the present time, and actual results may differ significantly from forecasts. Please refer to the cautionary statement at the end.
Consolidated Financial Results Summary
1. Consolidated Half-year Results
(In billions of yen except where noted)
FY '19 1st half (A)
(Apr. 1, 2018 - Sept. 30, 2018)FY '20 1st half (B)
(Apr. 1, 2019 - Sept. 30, 2019)
B - A
B/A (%)
Revenue
2,170.1
2,182.5
12.4
101
Operating profit
125.9
114.2
(11.7)
91
Profit before income taxes
141.2
124.0
(17.2)
88
Net profit attributable to Mitsubishi Electric Corp. stockholders
102.3
91.2
(11.0)
89
Basic earnings per share attributable to Mitsubishi Electric Corp. stockholders
47.70 yen
42.54 yen
(5.16 yen)
89
2. Consolidated Second-quarter Results
(In billions of yen except where noted)
FY '19 Q2 (A)
(Jul. 1, 2018 -
Sept. 30, 2018)FY '20 Q2 (B)
(Jul. 1, 2019 - Sept. 30, 2019)
B - A
B/A
(%)
Revenue
1,119.1
1,131.7
12.6
101
Operating profit
64.3
59.3
(5.0)
92
Profit before income taxes
72.5
64.2
(8.2)
89
Net profit attributable to Mitsubishi Electric Corp. stockholders
54.7
48.4
(6.2)
89
Basic earnings per share attributable to Mitsubishi Electric Corp. stockholders
25.52 yen
22.60 yen
(2.92 yen)
89
Notes:
1) Consolidated financial statements are made in accordance with International Financial Reporting Standards (IFRS).
2) The company has 208 consolidated subsidiaries.
Condensed Quarterly Consolidated Financial Statements
Condensed Quarterly Consolidated Statement of Profit or Loss and Condensed Quarterly Consolidated Statement of Comprehensive Income (First Half, Fiscal 2020)
(Condensed Quarterly Consolidated Statement of Profit or Loss)
(In millions of yen)
FY '19 1st half
(Apr. 1, 2018 -
Sept. 30, 2018)
FY '20 1st half
(Apr. 1, 2019 -
Sept. 30, 2019)
(A)
% of total
(B)
% of total
B - A
B/A
(%)
Revenue
2,170,106
100.0
2,182,528
100.0
12,422
101
Cost of sales
1,530,169
70.5
1,562,361
71.6
32,192
102
Selling, general and
administrative expenses
514,365
23.7
506,870
23.2
(7,495)
99
Other profit (loss)
368
0.0
933
0.0
565
254
Operating profit
125,940
5.8
114,230
5.2
(11,710)
91
Financial income
6,629
0.3
5,988
0.3
(641)
90
Financial expenses
1,285
0.1
5,605
0.2
4,320
436
Share of profit of investments accounted for using the
equity method10,007
0.5
9,409
0.4
(598)
94
Profit before income taxes
141,291
6.5
124,022
5.7
(17,269)
88
Income taxes
33,259
1.5
25,591
1.2
(7,668)
77
Net profit
108,032
5.0
98,431
4.5
(9,601)
91
Net profit attributable to:
Mitsubishi Electric Corp.
stockholders102,328
4.7
91,253
4.2
(11,075)
89
Non-controlling interests
5,704
0.3
7,178
0.3
1,474
126
(Condensed Quarterly Consolidated Statement of Comprehensive Income)
(In millions of yen)
FY '19
1st half (A)
(Apr. 1, 2018 -
Sept. 30, 2018)FY '20
1st half (B)
(Apr. 1, 2019 - Sept. 30, 2019)
B - A
Net profit
108,032
98,431
(9,601)
(Other comprehensive income (loss),
net of tax)
Items that will not be reclassified to
net profit
Changes in fair value of financial assets measured at fair value through other comprehensive income
(8,429)
6,001
14,430
Share of other comprehensive income of investments accounted for using the equity method
238
(352)
(590)
Subtotal
(8,191)
5,649
13,840
Items that may be reclassified to net profit
Exchange differences on translating foreign operations
9,386
(31,289)
(40,675)
Net changes in the fair value of cash flow hedges
92
(91)
(183)
Share of other comprehensive income of investments accounted for using the equity method
(1,763)
(2,255)
(492)
Subtotal
7,715
(33,635)
(41,350)
Total other comprehensive income (loss)
(476)
(27,986)
(27,510)
Comprehensive income
107,556
70,445
(37,111)
Comprehensive income attributable to:
Mitsubishi Electric Corp. stockholders
100,934
66,082
(34,852)
Non-controlling interests
6,622
4,363
(2,259)
Condensed Quarterly Consolidated Statement of Profit or Loss and Condensed Quarterly Consolidated Statement of Comprehensive Income (Second Quarter, Fiscal 2020)
(Condensed Quarterly Consolidated Statement of Profit or Loss)
(In millions of yen)
FY '19 Q2
(Jul. 1, 2018 -
Sept. 30, 2018)
FY '20 Q2
(Jul. 1, 2019 -
Sept. 30, 2019)
(A)
% of total
(B)
% of total
B - A
B/A
(%)
Revenue
1,119,124
100.0
1,131,764
100.0
12,640
101
Cost of sales
789,122
70.5
812,492
71.8
23,370
103
Selling, general and
administrative expenses
264,159
23.6
259,974
23.0
(4,185)
98
Other profit (loss)
(1,492)
(0.1)
21
0.0
1,513
－
Operating profit
64,351
5.8
59,319
5.2
(5,032)
92
Financial income
1,871
0.2
1,689
0.2
(182)
90
Financial expenses
675
0.1
2,845
0.2
2,170
421
Share of profit of investments accounted for using the
equity method7,014
0.6
6,114
0.5
(900)
87
Profit before income taxes
72,561
6.5
64,277
5.7
(8,284)
89
Income taxes
14,536
1.3
12,656
1.1
(1,880)
87
Net profit
58,025
5.2
51,621
4.6
(6,404)
89
Net profit attributable to:
Mitsubishi Electric Corp.
stockholders54,750
4.9
48,476
4.3
(6,274)
89
Non-controlling interests
3,275
0.3
3,145
0.3
(130)
96
(Condensed Quarterly Consolidated Statement of Comprehensive Income)
(In millions of yen)
FY '19 Q2 (A)
(Jul. 1, 2018 -
Sept. 30, 2018)
FY '20 Q2 (B)
(Jul. 1, 2019 -
Sept. 30, 2019)
B - A
Net profit
58,025
51,621
(6,404)
(Other comprehensive income (loss),
net of tax)
Items that will not be reclassified to
net profit
Changes in fair value of financial assets measured at fair value through other comprehensive income
(15,817)
9,974
25,791
Share of other comprehensive income of investments accounted for using the equity method
107
(287)
(394)
Subtotal
(15,710)
9,687
25,397
Items that may be reclassified to net profit
Exchange differences on translating foreign operations
18,538
(12,310)
(30,848)
Net changes in the fair value of cash flow hedges
110
(52)
(162)
Share of other comprehensive income of investments accounted for using the equity method
81
(2,689)
(2,770)
Subtotal
18,729
(15,051)
(33,780)
Total other comprehensive income (loss)
3,019
(5,364)
(8,383)
Comprehensive income
61,044
46,257
(14,787)
Comprehensive income attributable to:
Mitsubishi Electric Corp. stockholders
56,204
43,863
(12,341)
Non-controlling interests
4,840
2,394
(2,446)
Condensed Quarterly Consolidated Statement of Financial Position
(In millions of yen)
FY '19 (A)
(ended Mar. 31, 2019)
FY ' 20
1st half (B)
(ended Sept. 30, 2019)
B - A
(Assets)
Current assets
2,624,293
2,528,276
(96,017)
Cash and cash equivalents
514,224
514,170
(54)
Trade receivables and contract assets
1,233,916
1,117,364
(116,552)
Inventories
729,098
721,608
(7,490)
Other current assets
147,055
175,134
28,079
Non-current assets
1,731,918
1,829,725
97,807
Investments accounted for using the equity method
197,959
192,178
(5,781)
Other financial assets
303,834
314,116
10,282
Property, plant and equipment
760,540
852,972
92,432
Other non-current assets
469,585
470,459
874
Total assets
4,356,211
4,358,001
1,790
(Liabilities)
Current liabilities
1,416,335
1,362,635
(53,700)
Bonds, borrowings and lease liabilities
104,969
148,326
43,357
Trade payables
559,641
506,564
(53,077)
Other current liabilities
751,725
707,745
(43,980)
Non-current liabilities
428,721
477,913
49,192
Bonds, borrowings and lease liabilities
193,469
241,097
47,628
Net defined benefit liabilities
176,087
177,972
1,885
Other non-current liabilities
59,165
58,844
(321)
Total liabilities
1,845,056
1,840,548
(4,508)
(Equity)
Mitsubishi Electric Corp. stockholders' equity
2,399,946
2,407,907
7,961
Common stock
175,820
175,820
－
Capital surplus
202,834
201,990
(844)
Retained earnings
1,960,466
1,995,903
35,437
Accumulated other comprehensive income (loss)
63,809
37,117
(26,692)
Treasury stock, at cost
(2,983)
(2,923)
60
Non-controlling interests
111,209
109,546
(1,663)
Total equity
2,511,155
2,517,453
6,298
Total liabilities and equity
4,356,211
4,358,001
1,790
Bonds, borrowings and lease liabilities
298,438
389,423
90,985
Excluding lease liabilities
275,972
275,264
(708)
Accumulated other comprehensive income (loss):
Exchange differences on translating foreign operations
8,368
(22,326)
(30,694)
Financial assets measured at fair value through other comprehensive income
55,503
59,578
4,075
Net changes in the fair value of cash flow hedges
(62)
(135)
(73)
Condensed Quarterly Consolidated Statement of Changes in Equity
FY '19 1st Half (Apr. 1, 2018 - Sep. 30, 2018)
(In millions of yen)
Mitsubishi Electric Corp. stockholders' equity
Non-controlling interests
Total equity
Common stock
Capital surplus
Retained earnings
Accumulated other comprehensive income (loss)
Treasury stock, at cost
Total
Balance at beginning of period
175,820
199,442
1,811,348
109,492
(1,928)
2,294,174
103,045
2,397,219
Comprehensive income
Net profit
102,328
102,328
5,704
108,032
Other comprehensive income (loss), net of tax
(1,394)
(1,394)
918
(476)
Comprehensive income
－
－
102,328
(1,394)
－
100,934
6,622
107,556
Transfer to retained earnings
(241)
241
－
－
Dividends
(55,816)
(55,816)
(4,571)
(60,387)
Purchase of treasury stock
(1,054)
(1,054)
(1,054)
Disposal of treasury stock
0
0
0
0
Transactions with non-controlling interests and others
3,053
3,053
3,677
6,730
Balance at end of period
175,820
202,495
1,857,619
108,339
(2,982)
2,341,291
108,773
2,450,064
FY '20 1st Half (Apr. 1, 2019 - Sep. 30, 2019)
(In millions of yen)
Mitsubishi Electric Corp. stockholders' equity
Non-controlling interests
Total equity
Common stock
Capital surplus
Retained earnings
Accumulated other comprehensive income (loss)
Treasury stock, at cost
Total
Balance at beginning of period
175,820
202,834
1,960,466
63,809
(2,983)
2,399,946
111,209
2,511,155
Cumulative effects of changes in accounting policies
(1,521)
(1,521)
(7)
(1,528)
Restated balance at beginning of period
175,820
202,834
1,958,945
63,809
(2,983)
2,398,425
111,202
2,509,627
Comprehensive income
Net profit
91,253
91,253
7,178
98,431
Other comprehensive income (loss), net of tax
(25,171)
(25,171)
(2,815)
(27,986)
Comprehensive income
－
－
91,253
(25,171)
－
66,082
4,363
70,445
Transfer to retained earnings
1,521
(1,521)
－
－
Dividends
(55,816)
(55,816)
(5,094)
(60,910)
Purchase of treasury stock
(784)
(784)
(784)
Disposal of treasury stock
(844)
844
0
0
Transactions with non-controlling interests and others
－
(925)
(925)
Balance at end of period
175,820
201,990
1,995,903
37,117
(2,923)
2,407,907
109,546
2,517,453
Condensed Quarterly Consolidated Statement of Cash Flows
(In millions of yen)
FY '19 1st half
(Apr. 1, 2018 - Sept. 30, 2018)
(A)
FY '20 1st half
(Apr. 1, 2019 - Sept. 30, 2019)
(B)
B - A
I
Cash flows from operating activities
1
Net profit
108,032
98,431
(9,601)
2
Adjustments to cash flows from operating activities
(1) Depreciation, amortization and other
81,407
98,329
16,922
(2) Decrease in trade receivables and contract assets
126,701
103,058
(23,643)
(3) Decrease (increase) in inventories
(70,970)
(6,927)
64,043
(4) Increase (decrease) in trade payables
(49,041)
(50,058)
(1,017)
(5) Others, net
(51,828)
(28,419)
23,409
Cash flows from operating activities
144,301
214,414
70,113
II
Cash flows from investing activities
1
Purchase of property, plant and equipment
(88,211)
(95,978)
(7,767)
2
Proceeds from sale of property, plant and equipment
1,502
2,438
936
3
Purchase of investment securities (net of cash acquired)
(7,874)
(16,373)
(8,499)
4
Proceeds from sale of investment securities (net of cash disposed)
3,484
6,855
3,371
5
Others, net
(7,626)
(12,606)
(4,980)
Cash flows from investing activities
(98,725)
(115,664)
(16,939)
I + II
Free cash flow
45,576
98,750
53,174
III
Cash flows from financing activities
1
Proceeds and repayment of bonds and long-term borrowings
(10,004)
(29,462)
(19,458)
2
Increase in short-term borrowings, net
872
29,564
28,692
3
Repayments of lease liabilities
(4,547)
(26,183)
(21,636)
4
Dividends paid
(55,816)
(55,816)
(0)
5
Purchase of treasury stock
(1,054)
(784)
270
6
Disposal of treasury stock
0
0
(0)
7
Others, net
1,676
(4,670)
(6,346)
Cash flows from financing activities
(68,873)
(87,351)
(18,478)
IV
Effect of exchange rate changes on cash and cash equivalents
4,788
(11,453)
(16,241)
V
Net increase (decrease) in cash and cash equivalents
(18,509)
(54)
18,455
VI
Cash and cash equivalents at beginning of period
599,199
514,224
(84,975)
VII
Cash and cash equivalents at end of period
580,690
514,170
(66,520)
Consolidated Segment Information (First Half, Fiscal 2020)
1. Revenue and Operating Profit by Business Segment
(In millions of yen)
Business Segment
FY '19 1st half
(Apr. 1, 2018 -
Sept. 30, 2018)
FY '20 1st half
(Apr. 1, 2019 -
Sept. 30, 2019)
C - A
D - B
C/A
(%)
Revenue (A)
Operating profit (B)
Revenue
(C)Operating profit (D)
Energy and Electric Systems
568,642
15,564
592,110
20,465
23,468
4,901
104
Industrial Automation Systems
730,350
77,979
686,266
41,272
(44,084)
(36,707)
94
Information and
Communication Systems
186,867
2,502
199,025
4,705
12,158
2,203
107
Electronic Devices
101,896
1,269
103,149
1,039
1,253
(230)
101
Home Appliances
557,120
33,665
581,762
53,206
24,642
19,541
104
Others
327,831
10,343
316,245
9,521
(11,586)
(822)
96
Subtotal
2,472,706
141,322
2,478,557
130,208
5,851
(11,114)
100
Eliminations and corporate
(302,600)
(15,382)
(296,029)
(15,978)
6,571
(596)
－
Consolidated Total
2,170,106
125,940
2,182,528
114,230
12,422
(11,710)
101
*Notes: Inter-segment revenue are included in the above chart.
2. Revenue by Location of Customers
(In millions of yen)
Location of Customers
FY '19 1st half
(Apr. 1, 2018 -
Sept. 30, 2018)
FY '20 1st half
(Apr. 1, 2019 -
Sept. 30, 2019)
B - A
B/A (%)
Revenue (A)
% of total revenue
Revenue (B)
% of total revenue
Japan
1,168,802
53.9
1,216,657
55.7
47,855
104
North America
209,854
9.7
229,758
10.6
19,904
109
Asia (excluding Japan)
528,321
24.3
469,759
21.5
(58,562)
89
China
265,287
12.2
221,730
10.2
(43,557)
84
Europe
233,125
10.7
236,062
10.8
2,937
101
Others
30,004
1.4
30,292
1.4
288
101
Total overseas revenue
1,001,304
46.1
965,871
44.3
(35,433)
96
Consolidated total
2,170,106
100.0
2,182,528
100.0
12,422
101
Consolidated Segment Information (Second Quarter, Fiscal 2020)
1. Revenue and Operating Profit by Business Segment
(In millions of yen)
Business Segment
FY '19 Q2
(Jul. 1, 2018 -
Sept. 30, 2018)
FY '20 Q2
(Jul. 1, 2019 -
Sept. 30, 2019)
C - A
D - B
C/A
(%)
Revenue (A)
Operating profit (loss) (B)
Revenue
(C)Operating profit (D)
Energy and Electric Systems
301,245
9,586
316,277
11,269
15,032
1,683
105
Industrial Automation Systems
369,351
33,106
353,952
20,090
(15,399)
(13,016)
96
Information and
Communication Systems
107,085
4,342
112,616
3,339
5,531
(1,003)
105
Electronic Devices
50,434
(217)
52,195
442
1,761
659
103
Home Appliances
276,786
13,609
285,758
22,018
8,972
8,409
103
Others
172,174
9,183
166,722
7,370
(5,452)
(1,813)
97
Subtotal
1,277,075
69,609
1,287,520
64,528
10,445
(5,081)
101
Eliminations and corporate
(157,951)
(5,258)
(155,756)
(5,209)
2,195
49
－
Consolidated Total
1,119,124
64,351
1,131,764
59,319
12,640
(5,032)
101
*Notes: Inter-segment revenue are included in the above chart.
2. Revenue by Location of Customers
(In millions of yen)
Location of Customers
FY '19 Q2
(Jul. 1, 2018 -
Sept. 30, 2018)
FY '20 Q2
(Jul. 1, 2019 -
Sept. 30, 2019)
B - A
B/A (%)
Revenue (A)
% of total revenue
Revenue (B)
% of total revenue
Japan
627,368
56.1
654,200
57.8
26,832
104
North America
106,756
9.5
111,758
9.9
5,002
105
Asia (excluding Japan)
258,046
23.0
238,947
21.1
(19,099)
93
China
125,104
11.2
112,772
10.0
(12,332)
90
Europe
111,488
10.0
110,796
9.8
(692)
99
Others
15,466
1.4
16,063
1.4
597
104
Total overseas revenue
491,756
43.9
477,564
42.2
(14,192)
97
Consolidated total
1,119,124
100.0
1,131,764
100.0
12,640
101
Notes to the Condensed Consolidated Financial Statements
(Notes regarding the going concern assumption)
Not applicable
(Notes if there is any significant change in Mitsubishi Electric Corp. stockholders' equity)
Not applicable
(Changes in Accounting Policies)
The Mitsubishi Electric Group has applied IFRS 16 Lease (hereafter "IFRS16") from the first quarter of the current fiscal year.
The Mitsubishi Electric Group had previously not capitalized leases classified as operating lease under IAS 17, but, by applying IFRS 16, introduced the single accounting model to capitalize lessee's lease in principle. For all leases other than leases that have a lease term of 12 months or less and leases for which the underlying asset is of low value, right-of-use assets that represent a right to use an underlying asset and lease liabilities that represent the obligation for lease payment were recognized as of the commencement date.
In the condensed quarterly consolidated statements of financial position, the Mitsubishi Electric Group has presented right-of-use assets as property, plant and equipment, and lease liabilities as bonds, borrowings and lease liabilities.
The Mitsubishi Electric Group has applied IFRS16 retroactively following transitional measures, and has recognized the cumulative effect as an adjustment to the beginning balance of retained earnings in the current fiscal year.
By applying IFRS 16, right-of-use assets and lease liabilities were newly increased by 93,066 million yen and 95,193 million yen respectively as of the date of the initial application (April 1, 2019). Accordingly, retained earnings were decreased by 1,521 million yen.
Cautionary Statement
The Mitsubishi Electric Group (hereafter "the Group") is involved in development, manufacture and sales in a wide range of fields including Energy and Electric Systems, Industrial Automation Systems, Information and Communication Systems, Electronic Devices and Home Appliances, and these operations extend globally, not only inside Japan, but also in North America, Europe, Asia and other regions. While the statements herein are based on certain assumptions and premises that the Group trusts and considers to be reasonable under the circumstances on the date of announcement, actual financial standings and operating results are subject to change due to any of the factors as contemplated hereunder and/or any additional factor unforeseeable as of the date of this announcement. Such factors materially affecting the expectations expressed herein shall include but are not limited to the following:
(1) Important trends
The Group's operations may be affected by trends in the global economy, social conditions, laws, tax codes and regulations.
(2) Foreign currency exchange rates
Fluctuations in foreign currency markets may affect the Group's sales of exported products and purchases of imported materials that are denominated in U.S. dollars or euros, as well as its Asian production bases' sales of exported products and purchases of imported materials that are denominated in foreign currencies.
(3) Stock markets
A fall in stock market prices may cause a decline in value of the Group's marketable securities and pension assets.
(4) Supply/demand balance for products and procurement conditions for materials and components
A decline in prices and shipments due to changes in the supply/demand balance, as well as an increase in material prices due to a worsening of material and component procurement conditions, may adversely affect the Group's performance.
(5) Fund raising
An increase in interest rates, the yen interest rate in particular, would increase the Group's interest expenses.
(6) Significant patent matters
Important patent filings, licensing, copyrights and patent-related disputes may adversely affect related businesses.
(7) Environmental legislation or relevant issues
The Group may incur losses or expenses owing to changes in environmental legislation or the occurrence of environmental issues. Such changes in legislation or the occurrence of environmental issues may also impact manufacturing and all corporate activities of the Group.
(8) Flaws or defects in products or services
The Group may incur losses or expenses resulting out of flaws or defects in products or services, and the lowered reputation of the quality of all its products and services may affect the entire Group.
(9) Litigation and other legal proceedings
The Group's operations may be affected by lawsuits or other legal proceedings against Mitsubishi Electric, its subsidiaries and/or equity-method associates and joint ventures.
(10) Disruptive changes
Disruptive changes in technology, development of products using new technology, timing of production and market introduction may adversely affect the Group's performance.
(11) Business restructuring
The Group may record losses due to restructuring measures.
(12) Information security
The performance of the Group may be affected by computer virus infections, unauthorized access and other unpredictable incidents that lead to the loss or leakage of personal information held by the Group or confidential information regarding the Group's business such as its technology, sales and other operations.
(13) Natural disasters
The Group's operations, particularly manufacturing activities, may be affected by the occurrence of earthquakes, typhoons, tsunami, fires and other large-scale disasters.
(14) Other significant factors
The Group's operations may be affected by the outbreak of social or political upheaval due to terrorism, war, pandemic by new strains of influenza and other diseases, or other factors.
###
About Mitsubishi Electric Corporation
With nearly 100 years of experience in providing reliable, high-quality products, Mitsubishi Electric Corporation (TOKYO: 6503) is a recognized world leader in the manufacture, marketing and sales of electrical and electronic equipment used in information processing and communications, space development and satellite communications, consumer electronics, industrial technology, energy, transportation and building equipment. Embracing the spirit of its corporate statement, Changes for the Better, and its environmental statement, Eco Changes, Mitsubishi Electric endeavors to be a global, leading green company, enriching society with technology. The company recorded a revenue of 4,519.9 billion yen (US$ 40.7 billion*) in the fiscal year ended March 31, 2019. For more information visit:
www.MitsubishiElectric.com
*At an exchange rate of 111 yen to the US dollar, the rate given by the Tokyo Foreign Exchange Market on March 31, 2019
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