2007
Oct.30, 2007
Minebea Co., Ltd.
Minebea Posts Non-consolidated Extraordinary Loss and Revises Earnings Forecast
Minebea Co., Ltd. announced today that its recording of an extraordinary loss was approved by the Board of Directors on October 30, 2007. The extraordinary loss resulted from an allowance for bad debt to Minebea Technologies Pte. Ltd. This was due to a goodwill write-off following the transfer of functions from the South East Asian Region Sales Headquarters.
Minebea announced the transfer of its South East Asian Region Sales Headquarters functions to Thailand on March 23, 2007. The company expects this transfer to affect its non-consolidated financial results and will disclose further details at an appropriate time.
In light of its recent financial results and other business developments, Minebea has revised its consolidated and non-consolidated earnings forecasts for the interim period ending September 30, 2007 (April 1, 2007 through September 30, 2007) and non-consolidated earnings forecast for fiscal year ending March 31, 2008 (April 1, 2007 through March 31, 2008), announced on May 8, 2007 as follows.
1. Recording of an Extraordinary Loss
(1) Background
Minebea was providing bearings, bearing-related products, motors, other electronic devices and components manufactured at its plants in Thailand, China, Singapore and other locations to customers in Southeast Asia (mainly Singapore, Thailand, Malaysia, the Philippines, Indonesia and India) via its fully-owned Singapore subsidiary, Minebea Technologies Pte. Ltd. However, the top-selling products are those that are manufactured at the Thai plant, which is the largest of the Company's production bases, and there is an increasing need for the South East Asian Region Sales Headquarters to act as an intermediary between the company's customers and the Thai plant.
Given this situation, Minebea will move its South East Asian Region Sales Headquarters functions to its Thai subsidiary, Minebea Thai Ltd., as of November 1, 2007 with the plan to further expand sales in the Southeast Asian region and provide more responsive customer support. Sales functions within Singapore will be transferred to Minebea's subsidiary, NMB Singapore Ltd., as of November 1, 2007. Minebea Technologies Pte. Ltd. will then be liquidated upon completion of the move.
The extraordinary loss posted by Minebea Technologies Pte. Ltd., due to the goodwill write-off associated with the transfer of the South East Asian Region Sales Headquarters functions, will be reflected in Minebea's non-consolidated financial statements for this fiscal year as an extraordinary loss for allowance for bad debt.
(2) Date of recording: November 1, 2007
(3) Effect on income
An extraordinary loss of 4 billion yen will be recorded in the non-consolidated financial statements for fiscal year ending March 31, 2008.
The overseas subsidiary's goodwill has been amortized evenly over a fixed period of time on a consolidated basis, and thus will have no effect on consolidated financial statements.
2. Revisions to Earnings Forecast
(1) Non-consolidated
(i) Interim Period (April 1, 2007 through September 30, 2007)
(millions of yen)
|
|
Net Sales |
Operating Income |
Ordinary Income |
Net Income |
|---|---|---|---|---|
| Previous forecast (A) | 118,000 | 1,100 | 3,800 | 1,800 |
| Current forecast (B) | 114,833 | 3,367 | 4,461 | 1,910 |
| Increase or decrease (B - A) | -3,167 | 2,267 | 661 | 110 |
| Percentage increase or decrease | -2.7% | 206.1% | 17.4% | 6.1% |
| Previous 1st Half (ended September 30, 2006) Results | 114,170 | 4,375 | 4,946 | 2,544 |
(ii) Full Year (April 1, 2007 through March 31, 2008)
(millions of yen)
|
|
Net Sales |
Operating Income |
Ordinary Income |
Net Income |
|---|---|---|---|---|
| Previous forecast (A) | 245,000 | 3,000 | 9,200 | 4,800 |
| Current forecast (B) | 235,000 | 7,500 | 12,700 | 4,000 |
| Increase or decrease (B - A) | -10,000 | 4,500 | 3,500 | -800 |
| Percentage increase or decrease | -4.1% | 150.0% | 38.0% | -16.7% |
| Previous Full Year (ended March 31, 2007) Results | 228,406 | 8,948 | 12,396 | 5,618 |
(2) Consolidated
(i) Interim Period (April 1, 2007 through September 30, 2007)
(millions of yen)
|
|
Net Sales |
Operating Income |
Ordinary Income |
Net Income |
|---|---|---|---|---|
| Previous forecast (A) | 162,500 | 14,000 | 11,500 | 6,500 |
| Current forecast (B) | 168,247 | 15,121 | 13,236 | 7,474 |
| Increase or decrease (B - A) | 5,747 | 1,121 | 1,736 | 974 |
| Percentage increase or decrease | 3.5% | 8.0% | 15.1% | 15.0% |
| Previous 1st Half (ended September 30, 2006) Results | 163,998 | 13,367 | 10,947 | 7,468 |
(ii) Full Year (April 1, 2007 through March 31, 2008)
No change has been made to the consolidated annual forecast since it was announced on May 8, 2007.
(3) Justification for Revisions
The above revisions have been made because Minebea estimates that both consolidated and non-consolidated earnings will significantly exceed the initial forecast due to good sales of machined components such as bearings and rod-end bearings as well as electronic components such as information motors and keyboards.
No change has been made to the consolidated annual forecast since it was announced on May 8, 2007.
Note:The above forecast is based on the information available at the time this notice was released.
Actual results may differ from those stated depending on a variety of factors.
3. Supplementary Information
Outline of Corporation in Singapore
Minebea Technologies Pte. Ltd.
Representative: Koichi Dosho
Date of Establishment: August 1992
Capital: SGD 40 million
Sales: USD 236 million (fiscal year ending March, 2007)
Principal Business: Sale of products produced by Minebea group (in Southeast Asia)
Shareholder: Minebea 100%
Outline of Corporation in Thailand
Minebea Thai Ltd.
Representative: Morihiro Iijima
Date of Establishment: May 1984
Capital: THB 8,381 million
Sales: THB 24,899 million (fiscal year ending March 2007)
Principal Business: Manufacture of Minebea group products
Shareholder: Minebea 100%
Outline of Corporation in Singapore
NMB Singapore Ltd.
Representative: Morihiro Iijima
Date of Establishment: February 1972
Capital: SGD 38 million
Sales: SGD 85 million (fiscal year ending March 2007)
Principal Business: Manufacture of Minebea group products
Shareholder: Minebea 100%
| Company Name: | Minebea Co., Ltd. |
|---|---|
| Representative: | Takayuki Yamagishi Representative Director, President and Chief Executive Officer (Code No. 6479 TSE Div. No. 1) |
| Contact Person: | Sakae Yashiro Senior Managing Executive Officer Deputy Chief of Administration Headquarters (TEL: 81-3-5434-8611) |
Product information, contact and other context are subject to change without prior notice.
