Briefing on items on the agenda
Latest Update : July 12, 2011
Back to Shareholders' Meetings (Year 2011)
The 65th Ordinary General Meeting of Shareholders
Business Report
I will now give you a summary of our business report as well as consolidated and non-consolidated financial statements for the 65th business year.
More information is provided on pages 4 through 41 of the business report.
Brief Explanation of the Current Business Environment
I'll start with a brief explanation of the current business environment.
Current Situation of Japanese Economy
During the fiscal year ended March 31, 2011, the Japanese economy saw a moderate recovery that included enhanced corporate earnings and a turnaround in capital spending despite relatively high unemployment rates. The massive earthquake that rocked northeastern Japan on March 11 and resulting tsunami that crippled the nuclear power plant at Fukushima not only devastated the areas of immediate impact but also sent shock waves rippling through the Japanese economy. In the wake of these multiple disasters it is difficult to make predictions about production, employment, consumption, etc.
Current Situation of Global Economy
The U.S. economy also continued to rebound at a moderate pace. This comeback has been aided by economic stimulus measures designed to boost corporate earnings as well as the recovery of overseas economies, despite slow personal consumption due to continued high unemployment.
The economies of Europe have generally turned around as a whole, although economic conditions vary widely from one country to another.
China's active fiscal stimulus package boosted domestic spending and fueled growth of the Chinese economy while other Asian economies remained on track thanks to exports to China.
Corporate Group Initiatives
Against this backdrop, the Minebea Group has been actively working to cut costs, create high-value-added products, develop new technologies, and enhance its marketing approach in order to further increase profitability.
Improved market conditions and other business factors led to substantial increases in sales and profits, despite the negative impact of the strong Japanese yen.
Current Fiscal Year Results on Consolidated Basis
Net sales increased 40,693 million yen year on year to total 269,139 million yen, while operating income rose 10,104 million yen year on year to reach 22,163 million yen.
Ordinary income was 20,364 million yen, up 10,161 million yen year on year while net income jumped 5,803 million yen to total 12,465 million yen.
Business Results by Segment
Now let's look at our performance by segment.
Machined Components Business
Products in the machined components business segment include ball bearings, our mainstay product, mechanical components, such as rod-end bearings used primarily in aircraft and pivot assemblies for use in hard disk drives (HDDs), as well as fasteners for automobiles and aircraft.
Sales of ball bearings and rod-end bearings, our key products, were buoyed by an upbeat market.
Pivot assembly sales remained flat due to the strong yen despite an uptick in sales volume to the hard disk industry, our primary market.
Net sales were up 8,550 million year on year to total 107,841 million yen.
Operating income increased 7,454 million yen year on year to total 28,088 million yen due to ongoing efforts to lower costs via improvements to basic technologies, product technologies and manufacturing techniques.
Rotary Components Business
Our core products in the rotary components business include information motors (fan motors, stepping motors, DC brushless motors, vibration motors and DC brush motors), hard disk drive (HDD) spindle motors and other precision motors.
Information motor sales were up thanks to improved market conditions as well as the addition of DC brushless motors to our product line.
The negative impact of the strong Japanese yen on sales of HDD spindle motors was offset by solid performance in the hard disk industry, our target market.
Net sales for this fiscal year were up 26,954 million year on year to total 101,139 million yen.
A drop in sales of precision motors made a dent in our bottom line despite ongoing cost reduction efforts aimed at information motors (excluding vibration and DC brush motors). Operating loss improved 1,602 million yen year on year to total 224 million yen.
Electronic Devices and Components Business
Our core products in the electronic devices and components business include liquid crystal display (LCD) backlights, inverters and measuring instruments.
Due to the market recovery and active expansion, sales of LCD backlights increased dramatically.
This increase brought net sales for this fiscal year up 4,722 million yen year on year to total 40,502 million yen.
Operating income fell 1,224 million yen year on year to 4,160 million yen as the discontinuation of some measuring component products narrowed down the profit margin.
Other Business
Our main products in the other business include PC keyboards, speakers, and special components for the defense industry.
Net sales for these products increased 468 million yen year on year to hit 19,657 million yen. The turnaround in the keyboard business brought operating income up 1,182 million yen year on year for a total of 498 million yen.
Consolidated Operating Income for this Fiscal Year
In addition to everything previously mentioned, our operating income included 10,358 million yen in corporate expenses, etc. that don't belong to any particular segment, which has been shown as adjustments. Adjustments for this fiscal year amounted to 11,447 million on a consolidated basis.
Capital Expenditures
Now let's move on to capital investments made during the fiscal year.
Capital investments for the fiscal year totaled 27,335 million yen. These investments include 10,783 million yen for the machined components segment, 9,489 million yen for the rotary components segment, 1,514 million yen for the electronic devices and components segment, 825 million yen for the other business segment and 4,722 million for overall Minebea operations.
Investments in the machined components segment were designed to boost production capacity and streamline production facilities for bearings and other products in Thailand, China, Singapore and the United States. We also invested in HDD pivot assembly production facilities to increase production capacity.
Investments in the rotary components segment included equipment purchases for HDD spindle motors production in Thailand as well as production equipment for information motors in Thailand, China and other areas.
Investments in the electronic devices and components segment focused on manufacturing equipment used to produce backlights for LCDs and component production facilities in Thailand and China.
Capital investments included purchases of intangible fixed assets totaling 343 million yen and assets acquired through new finance leases amounting to 248 million yen.
Consolidated Financial Statements
Here is an overview of our consolidated financial statements.
Consolidated Balance Sheet
Looking at the consolidated balance sheet, we saw total assets increase 13,125 million yen from the previous consolidated fiscal year end to total 291,092 million yen. The major factors behind this uptick include increases in inventories and in notes and accounts receivable due to rebounding production and sales.
Liabilities totaled 181,125 million yen, up 11,539 million yen from the previous consolidated fiscal year end. This jump was primarily due to an increase in notes and accounts payable (trade) resulting from greater production as well as an increase in long-term loans and a decrease in bonds.
Net assets rose 1,586 million yen year on year to total 109,967 million yen. This increase was due to a huge gain in retained earnings as a result of a significantly larger net income that offset the loss on the foreign currency translation adjustments.
These results all add up to total liabilities and net assets of 291,092 million yen, a 13,125 million yen increase over the previous consolidated fiscal year end.
Consolidated Statement of Income
Now let's look at the consolidated statement of income.
Net sales rose 40,693 million yen year on year to total 269,139 million yen.
Operating income was also up 10,104 million yen year on year at 22,163 million yen.
Ordinary income was up 10,161 million yen year on year to total 20,364 million yen. The primary factors behind this increase include a reduction in interest-bearing debts which brought down non-operating expenses due to lower interest payments. Net income totaled 12,465 million yen.
Consolidated Statement of Changes in Net Assets and Notes
I will skip the consolidated statement of changes in net assets and notes, which are provided on pages 22 through 31 of the business report for the 65th business year.
Non-Consolidated Financial Statements
Next is an overview of our non-consolidated financial statements.
Non-Consolidated Balance Sheet
The balance sheet shows a year-on-year 11,955 million yen increase in assets, bringing total assets to 323,792 million yen. This is due primarily to increases in loans to affiliated companies and inventories due to rebounding production.
Liabilities totaled 148,866 million yen, up 10,055 million yen from the previous consolidated fiscal year end. The primary reasons for this gain include an increase in long-term loans and a decrease in bonds.
Net assets totaled 174,926 million yen, up 1,900 million yen from the previous fiscal year end. This gain was primarily due to an increase in retained earnings from net income and a decrease due to dividend payments.
These results all added up to total liabilities and net assets of 323,792 million yen, an 11,955 million yen increase from the previous fiscal year end.
Non-Consolidated Statement of Income
The non-consolidated statement of income shows net sales increasing 43,047 million yen year on year to reach 201,058 million yen. An improved market was the main factor behind this surge in sales growth.
Operating income was also up 7,270 million yen year on year to total 7,826 million yen. This rise was primarily due to an increase in sales on top of reduced costs.
These results altogether led to a year-on-year increase of 2,259 million yen in operating income totaling 9,012 million yen.
These figures combined add up to a net income totaling 4,817 million yen.
Non-Consolidated Statement of Changes in Net Assets and Notes
You will find the non-consolidated statement of changes in net assets and notes on pages 35 through 41 of the business report for the 65th business year.
