30 Jul 2019 07:00
FOR IMMEDIATE RELEASE | No. 3291 |
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Investor Relations Inquiries | Media Inquiries |
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Investor Relations Group, Corporate Finance Division | Public Relations Division |
Mitsubishi Electric Corporation | Mitsubishi Electric Corporation |
Cad.Irg@rk.MitsubishiElectric.co.jp | prd.gnews@nk.MitsubishiElectric.co.jp |
| www.MitsubishiElectric.com/news/ |
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Mitsubishi Electric Announces Consolidated Financial Resultsfor the First Quarter of Fiscal 2020
TOKYO, July 30, 2019 - Mitsubishi Electric Corporation (TOKYO: 6503) announced today its consolidated financial results for the first quarter, ended June 30, 2019, of the current fiscal year ending March 31, 2020 (fiscal 2020).
Consolidated Financial Results
Revenue: | 1,050.7 | billion yen | (Substantially unchanged from the same period last year) |
Operating profit: | 54.9 | billion yen | (11% decrease from the same period last year) |
Profit before income taxes: | 59.7 | billion yen | (13% decrease from the same period last year) |
Net profit attributable to Mitsubishi Electric Corp. stockholders: | 42.7 | billion yen | (10% decrease from the same period last year) |
The economy in the first quarter, from April through June 2019, of fiscal 2020 saw an expansion in the U.S. mainly owing to buoyant consumer consumption, while China experienced a slowdown in economic growth. In addition, Japan saw decreases in export and production, and Europe also experienced a decrease in production, making the economic recovery trend in both markets more moderate.
Under these circumstances, revenue in the first quarter remained substantially unchanged compared to the same period of the previous fiscal year to 1,050.7 billion yen with increased revenue in the Energy and Electric Systems, Information and Communication Systems and Home Appliances segments, as well as decreased revenue in the Industrial Automation Systems and Electronic Devices segments.
Operating profit decreased by 11% compared to the same period of the previous fiscal year to 54.9 billion yen, due to decreased profits in the Industrial Automation Systems and Electronic Devices segments.
Profit before income taxes decreased by 13% compared to the same period of the previous fiscal year to 59.7 billion yen.
Net profit attributable to Mitsubishi Electric Corporation stockholders decreased by 10% compared to the same period of the previous fiscal year to 42.7 billion yen.
Consolidated Financial Results by Business Segment
Energy and Electric Systems
Revenue: | 275.8 | billion yen | (3% increase from the same period last year which recorded 267.3 billion yen) |
Operating profit: | 9.1 | billion yen | (3.2 billion yen increase from the same period last year which recorded 5.9 billion yen) |
The social infrastructure systems business saw increases in both orders and revenue from the same period of the previous fiscal year due primarily to increases in the transportation systems business in Japan and the power systems business outside Japan.
The building systems business saw a decrease in orders compared to the same period of the previous fiscal year due to a stagnation in China and the Middle East, while revenue in this business experienced an increase compared to the same period of the previous fiscal year due 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 3% from the same period of the previous fiscal year to 275.8 billion yen. Operating profit increased by 3.2 billion yen from the same period of the previous fiscal year to 9.1 billion yen mainly due to an increase in revenue.
Industrial Automation Systems
Revenue: | 332.3 | billion yen | (8% decrease from the same period last year which recorded 360.9 billion yen) |
Operating profit: | 21.1 | billion yen | (23.6 billion yen decrease from the same period last year which recorded 44.8 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 a slowdown in capital expenditures in semiconductors, machinery and automotive-related equipment in Japan, and also to stagnation in the fields of organic light emitting diodes (OLED) and smartphones outside Japan.
The automotive equipment business saw decreases in both orders and revenue from the same period of the previous fiscal year due primarily to decreases in Japan and other markets in Asia, despite increased sales in electric-vehicle related equipment in response to market growth worldwide.
As a result, revenue for this segment decreased by 8% from the same period of the previous fiscal year to 332.3 billion yen. Operating profit decreased by 23.6 billion yen from the same period of the previous fiscal year to 21.1 billion yen mainly due to a decrease in revenue, a shift in product mix and upfront investment for growth drivers.
Information and Communication Systems
Revenue: | 86.4 | billion yen | (8% increase from the same period last year which recorded 79.7 billion yen) |
Operating profit: | 1.3 | billion yen | (3.2 billion yen improvement from the same period last year which recorded a loss of 1.8 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 in 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 an increase in orders compared to the same period of the previous fiscal year due to increased orders for large projects in the space systems business, while revenue experienced an increase compared to the same period of the previous fiscal year due to an increase in the defense systems business.
As a result, revenue for this segment increased by 8% compared to the same period of the previous fiscal year to 86.4 billion yen. Operating profit improved by 3.2 billion yen from the same period of the previous fiscal year to 1.3 billion yen due primarily to an increase in revenue and a shift in project portfolios.
Electronic Devices
Revenue: | 50.9 | billion yen | (1% decrease from the same period last year which recorded 51.4 billion yen) |
Operating profit: | 0.5 | billion yen | (0.8 billion yen decrease from the same period last year which recorded 1.4 billion yen) |
The electronic devices business saw an increase in orders from the same period of the previous fiscal year due primarily to increased demand for power modules used in automotive and railcar applications, while revenue decreased by 1% from the same period of the previous fiscal year to 50.9 billion yen mainly due to decreased demand for optical communication devices.
Operating profit decreased by 0.8 billion yen compared to the same period of the previous fiscal year to 0.5 billion yen due primarily to a decrease in revenue.
Home Appliances
Revenue: | 296.0 | billion yen | (6% increase from the same period last year which recorded 280.3 billion yen) |
Operating profit: | 31.1 | billion yen | (11.1 billion yen increase from the same period last year which recorded 20.0 billion yen) |
The home appliances business saw an increase in revenue by 6% from the same period of the previous fiscal year to 296.0 billion yen mainly due to an increase in air conditioners for Japan, North America and Europe.
Operating profit increased by 11.1 billion yen compared to the same period of the previous fiscal year due primarily to an increase in revenue.
Others
Revenue: | 149.5 | billion yen | (4% decrease from the same period last year which recorded 155.6 billion yen) |
Operating profit: | 2.1 | billion yen | (0.9 billion yen increase from the same period last year which recorded 1.1 billion yen) |
Revenue decreased by 4% compared to the same period of the previous fiscal year to 149.5 billion yen due primarily to a decrease in procurements for the Mitsubishi Electric Group at affiliated companies involved in materials procurement.
Operating profit increased by 0.9 billion yen compared to the same period of the previous fiscal year to 2.1 billion yen due primarily to cost improvements.
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 decreased from the end of the previous fiscal year by 61.3 billion yen to 4,294.9 billion yen. The change in balance of total assets was mainly attributable to increases in property, plant and equipment by 81.2 billion yen, while trade receivables and contract assets decreased by 184.0 billion yen primarily as a result of credit collection.
Total liabilities decreased from the end of the previous fiscal year by 24.9 billion yen to 1,820.1 billion yen. The outstanding balances of bonds, borrowings and lease liabilities increased by 83.4 billion yen, while trade payables decreased by 56.2 billion yen, and other current liabilities also decreased by 49.7 billion yen. Meanwhile, bonds and borrowings decreased by 12.3 billion yen from the end of the previous fiscal year to 263.6 billion yen, with the ratio of bonds and borrowings to total assets recording 6.1%.
Mitsubishi Electric Corporation stockholders' equity decreased by 35.9 billion yen compared to the end of the previous fiscal year to 2,364.0 billion yen. The stockholders' equity ratio was recorded at 55.0%, representing a 0.1 point decrease compared to the end of the previous fiscal year. These changes referred to above primarily result from a decrease in dividend payment of 55.8 billion yen and a decrease in accumulated other comprehensive income by 20.5 billion yen mainly reflecting the yen's appreciation against foreign currencies, despite an increase from recording a net profit attributable to Mitsubishi Electric Corporation stockholders of 42.7 billion yen.
An analysis on the status of cash flow on a consolidated basis
Cash flows from operating activities for this quarter increased by 29.2 billion yen compared to the same period of the previous fiscal year to 126.4 billion yen (cash in). Cash flows from investing activities increased by 12.2 billion yen compared to the same period of the previous fiscal year to 51.0 billion yen (cash out), due primarily to an increase in purchase of property, plant and equipment. As a result, free cash flow was 75.4 billion yen (cash in). Cash flows from financing activities were 82.0 billion yen (cash out) mainly due to dividend payments.
Forecast for Fiscal 2020
The current consolidated earnings forecast for fiscal 2020, ending March 31, 2020, is unchanged from the announcement on April 26, 2019 as stated below.
Current consolidated forecast for fiscal 2020
Revenue | 4,630.0 | billion yen | (2% increase from fiscal 2019) |
Operating profit | 295.0 | billion yen | (2% increase from fiscal 2019) |
Profit before income taxes | 320.0 | billion yen | (1% increase from fiscal 2019) |
Net profit attributable to Mitsubishi Electric Corp. stockholders | 240.0 | billion yen | (6% increase from fiscal 2019) |
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
(In billions of yen except where noted)
| FY '19 Q1 (A) (Apr. 1, 2018 - Jun. 30, 2018) | FY '20 Q1 (B) (Apr. 1, 2019 - Jun. 30, 2019) |
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B - A | B/A (%) | |||
Revenue | 1,050.9 | 1,050.7 | (0.2) | 100 |
Operating profit | 61.5 | 54.9 | (6.6) | 89 |
Profit before income taxes | 68.7 | 59.7 | (8.9) | 87 |
Net profit attributable to Mitsubishi Electric Corp.stockholders | 47.5 | 42.7 | (4.8) | 90 |
Basic earnings per share attributable to Mitsubishi Electric Corp. stockholders | 22.18 yen | 19.94 yen | (2.24 yen) | 90 |
Notes:
1) Consolidated financial charts made in accordance with International Financial Reporting Standards (IFRS).
2) The company has 204 consolidated subsidiaries.
Condensed Quarterly Consolidated Financial Statements
Condensed Quarterly Consolidated Statement of Profit or Loss andCondensed Quarterly Consolidated Statement of Comprehensive Income
(Condensed Quarterly Consolidated Statement of Profit or Loss)
(In millions of yen)
| FY '19 Q1 (Apr. 1, 2018 - Jun. 30, 2018) | FY '20 Q1 (Apr. 1, 2019 - Jun. 30, 2019) |
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(A) | % of total | (B) | % of total | B - A | B/A (%) | |
Revenue | 1,050,982 | 100.0 | 1,050,764 | 100.0 | (218) | 100 |
Cost of sales | 741,047 | 70.5 | 749,869 | 71.4 | 8,822 | 101 |
Selling, general andadministrative expenses | 250,206 | 23.8 | 246,896 | 23.5 | (3,310) | 99 |
Other profit (loss) | 1,860 | 0.2 | 912 | 0.1 | (948) | 49 |
Operating profit | 61,589 | 5.9 | 54,911 | 5.2 | (6,678) | 89 |
Financial income | 4,758 | 0.4 | 4,299 | 0.4 | (459) | 90 |
Financial expenses | 610 | 0.1 | 2,760 | 0.2 | 2,150 | 452 |
Share of profit of investments accounted for using the equity method | 2,993 | 0.3 | 3,295 | 0.3 | 302 | 110 |
Profit before income taxes | 68,730 | 6.5 | 59,745 | 5.7 | (8,985) | 87 |
Income taxes | 18,723 | 1.7 | 12,935 | 1.2 | (5,788) | 69 |
Net profit | 50,007 | 4.8 | 46,810 | 4.5 | (3,197) | 94 |
Net profit attributable to: |
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Mitsubishi Electric Corp.stockholders | 47,578 | 4.5 | 42,777 | 4.1 | (4,801) | 90 |
Non-controlling interests | 2,429 | 0.3 | 4,033 | 0.4 | 1,604 | 166 |
(Condensed Quarterly Consolidated Statement of Comprehensive Income)
(In millions of yen)
| FY '19 Q1 (A) (Apr. 1, 2018 - Jun. 30, 2018) | FY '20 Q1 (B) (Apr. 1, 2019 - Jun. 30, 2019) | B - A |
Net profit | 50,007 | 46,810 | (3,197) |
(Other comprehensive income (loss),net of tax) |
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Items that will not be reclassified tonet profit |
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Changes in fair value of financial assets measured at fair value through other comprehensive income | 7,388 | (3,973) | (11,361) |
Share of other comprehensive income of investments accounted for using the equity method | 131 | (65) | (196) |
Subtotal | 7,519 | (4,038) | (11,557) |
Items that may be reclassified to net profit |
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Exchange differences on translating foreign operations | (9,152) | (18,979) | (9,827) |
Net changes in the fair value of cash flow hedges | (18) | (39) | (21) |
Share of other comprehensive income of investments accounted for using the equity method | (1,844) | 434 | 2,278 |
Subtotal | (11,014) | (18,584) | (7,570) |
Total other comprehensive income (loss) | (3,495) | (22,622) | (19,127) |
Comprehensive income | 46,512 | 24,188 | (22,324) |
Comprehensive income attributable to: |
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Mitsubishi Electric Corp. stockholders | 44,730 | 22,219 | (22,511) |
Non-controlling interests | 1,782 | 1,969 | 187 |
Condensed Quarterly Consolidated Statement of Financial Position
(In millions of yen)
| FY '19 (A) (ended Mar. 31, 2019) | FY ' 20 Q1 (B) (ended Jun. 30, 2019) | B - A |
(Assets) |
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Current assets | 2,624,293 | 2,497,073 | (127,220) |
Cash and cash equivalents | 514,224 | 500,644 | (13,580) |
Trade receivables and contract assets | 1,233,916 | 1,049,818 | (184,098) |
Inventories | 729,098 | 756,930 | 27,832 |
Other current assets | 147,055 | 189,681 | 42,626 |
Non-current assets | 1,731,918 | 1,797,838 | 65,920 |
Investments accounted for using the equity method | 197,959 | 190,469 | (7,490) |
Other financial assets | 303,834 | 304,500 | 666 |
Property, plant and equipment | 760,540 | 841,764 | 81,224 |
Other non-current assets | 469,585 | 461,105 | (8,480) |
Total assets | 4,356,211 | 4,294,911 | (61,300) |
(Liabilities) |
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Current liabilities | 1,416,335 | 1,333,905 | (82,430) |
Bonds, borrowings and lease liabilities | 104,969 | 128,544 | 23,575 |
Trade payables | 559,641 | 503,375 | (56,266) |
Other current liabilities | 751,725 | 701,986 | (49,739) |
Non-current liabilities | 428,721 | 486,251 | 57,530 |
Bonds, borrowings and lease liabilities | 193,469 | 253,356 | 59,887 |
Net defined benefit liabilities | 176,087 | 176,240 | 153 |
Other non-current liabilities | 59,165 | 56,655 | (2,510) |
Total liabilities | 1,845,056 | 1,820,156 | (24,900) |
(Equity) |
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Mitsubishi Electric Corp. stockholders' equity | 2,399,946 | 2,364,044 | (35,902) |
Common stock | 175,820 | 175,820 | － |
Capital surplus | 202,834 | 201,990 | (844) |
Retained earnings | 1,960,466 | 1,945,901 | (14,565) |
Accumulated other comprehensive income (loss) | 63,809 | 43,256 | (20,553) |
Treasury stock, at cost | (2,983) | (2,923) | 60 |
Non-controlling interests | 111,209 | 110,711 | (498) |
Total equity | 2,511,155 | 2,474,755 | (36,400) |
Total liabilities and equity | 4,356,211 | 4,294,911 | (61,300) |
Bonds, borrowings and lease liabilities | 298,438 | 381,900 | 83,462 |
Excluding lease liabilities | 275,972 | 263,617 | (12,355) |
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Accumulated other comprehensive income (loss): |
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Exchange differences on translating foreign operations | 8,368 | (8,134) | (16,502) |
Financial assets measured at fair value through other comprehensive income | 55,503 | 51,473 | (4,030) |
Net changes in the fair value of cash flow hedges | (62) | (83) | (21) |
Condensed Quarterly Consolidated Statement of Changes in Equity
FY '19 Q1 (Apr. 1, 2018 - Jun. 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 |
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Net profit |
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| 47,578 |
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| 47,578 | 2,429 | 50,007 |
Other comprehensive income (loss), net of tax |
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| (2,848) |
| (2,848) | (647) | (3,495) |
Comprehensive income | － | － | 47,578 | (2,848) | － | 44,730 | 1,782 | 46,512 |
Transfer to retained earnings |
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| (203) | 203 |
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Dividends |
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| (55,816) |
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| (55,816) | (2,585) | (58,401) |
Purchase of treasury stock |
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| (1,054) | (1,054) |
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Transactions with non-controlling interests and others |
| 3,197 |
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| 3,197 | 4,596 | 7,793 |
Balance at end of period | 175,820 | 202,639 | 1,802,907 | 106,847 | (2,982) | 2,285,231 | 106,838 | 2,392,069 |
FY '20 Q1 (Apr. 1, 2019 - Jun. 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 |
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| (1,521) |
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| (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 |
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Net profit |
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| 42,777 |
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| 42,777 | 4,033 | 46,810 |
Other comprehensive income (loss), net of tax |
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| (20,558) |
| (20,558) | (2,064) | (22,622) |
Comprehensive income | － | － | 42,777 | (20,558) | － | 22,219 | 1,969 | 24,188 |
Transfer to retained earnings |
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Dividends |
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| (55,816) |
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| (55,816) | (1,642) | (57,458) |
Purchase of treasury stock |
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| (784) | (784) |
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Disposal of treasury stock |
| (844) |
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| 844 | 0 |
| 0 |
Transactions with non-controlling interests and others |
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| － | (818) | (818) |
Balance at end of period | 175,820 | 201,990 | 1,945,901 | 43,256 | (2,923) | 2,364,044 | 110,711 | 2,474,755 |
Condensed Quarterly Consolidated Statement of Cash Flows
(In millions of yen)
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| FY '19 Q1 (Apr. 1, 2018 - Jun. 30, 2018) (A) | FY '20 Q1 (Apr. 1, 2019 - Jun. 30, 2019) (B) | B - A |
I | Cash flows from operating activities |
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1 | Net profit | 50,007 | 46,810 | (3,197) |
2 | Adjustments to cash flows from operating activities |
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| (1) Depreciation, amortization and other | 38,093 | 46,780 | 8,687 |
| (2) Decrease in trade receivables and contract assets | 164,962 | 176,039 | 11,077 |
| (3) Decrease (increase) in inventories | (62,155) | (36,211) | 25,944 |
| (4) Increase (decrease) in trade payables | (39,220) | (54,838) | (15,618) |
| (5) Others, net | (54,451) | (52,131) | 2,320 |
| Cash flows from operating activities | 97,236 | 126,449 | 29,213 |
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II | Cash flows from investing activities |
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1 | Purchase of property, plant and equipment | (36,350) | (43,096) | (6,746) |
2 | Proceeds from sale of property, plant and equipment | 1,102 | 714 | (388) |
3 | Purchase of investment securities | (4,129) | (6,401) | (2,272) |
4 | Proceeds from sale of investment securities (net of cash disposed) | 1,944 | 3,646 | 1,702 |
5 | Others, net | (1,288) | (5,864) | (4,576) |
| Cash flows from investing activities | (38,721) | (51,001) | (12,280) |
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I + II | Free cash flow | 58,515 | 75,448 | 16,933 |
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III | Cash flows from financing activities |
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1 | Proceeds and repayment of bonds and long-term borrowings | (10,011) | (30,495) | (20,484) |
2 | Increase (decrease) in short-term borrowings, net | (1,814) | 18,798 | 20,612 |
3 | Repayments of lease liabilities | (2,325) | (12,753) | (10,428) |
4 | Dividends paid | (55,816) | (55,816) | (0) |
5 | Purchase of treasury stock | (1,054) | (784) | 270 |
6 | Disposal of treasury stock | － | 0 | 0 |
7 | Others, net | 7,001 | (982) | (7,983) |
| Cash flows from financing activities | (64,019) | (82,032) | (18,013) |
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IV | Effect of exchange rate changes on cash and cash equivalents | (1,207) | (6,996) | (5,789) |
V | Net increase (decrease) in cash and cash equivalents | (6,711) | (13,580) | (6,869) |
VI | Cash and cash equivalents at beginning of period | 599,199 | 514,224 | (84,975) |
VII | Cash and cash equivalents at end of period | 592,488 | 500,644 | (91,844) |
Consolidated Segment Information
1. Revenue and Operating Profit by Business Segment
(In millions of yen)
Business Segment | FY '19 Q1 (Apr. 1, 2018 - Jun. 30, 2018) | FY '20 Q1 (Apr. 1, 2019 - Jun. 30, 2019) | C - A | D - B | C/A (%) | ||
Revenue (A) | Operating profit(loss) (B) | Revenue(C) | Operating profit(D) | ||||
Energy and Electric Systems | 267,397 | 5,978 | 275,833 | 9,196 | 8,436 | 3,218 | 103 |
Industrial Automation Systems | 360,999 | 44,873 | 332,314 | 21,182 | (28,685) | (23,691) | 92 |
Information and Communication Systems | 79,782 | (1,840) | 86,409 | 1,366 | 6,627 | 3,206 | 108 |
Electronic Devices | 51,462 | 1,486 | 50,954 | 597 | (508) | (889) | 99 |
Home Appliances | 280,334 | 20,056 | 296,004 | 31,188 | 15,670 | 11,132 | 106 |
Others | 155,657 | 1,160 | 149,523 | 2,151 | (6,134) | 991 | 96 |
Subtotal | 1,195,631 | 71,713 | 1,191,037 | 65,680 | (4,594) | (6,033) | 100 |
Eliminations and corporate | (144,649) | (10,124) | (140,273) | (10,769) | 4,376 | (645) | － |
Consolidated total | 1,050,982 | 61,589 | 1,050,764 | 54,911 | (218) | (6,678) | 100 |
*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 Q1 (Apr. 1, 2018 - Jun. 30, 2018) | FY '20 Q1 (Apr. 1, 2019 - Jun. 30, 2019) | B - A | B/A (%) | |||||
Revenue (A) | % of total revenue | Revenue (B) | % of total revenue | ||||||
| Japan | 541,434 | 51.5 | 562,457 | 53.5 | 21,023 | 104 | ||
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| North America | 103,098 | 9.8 | 118,000 | 11.2 | 14,902 | 114 | |
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| Asia (excluding Japan) | 270,275 | 25.7 | 230,812 | 22.0 | (39,463) | 85 | |
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| China | 140,183 | 13.3 | 108,958 | 10.4 | (31,225) | 78 |
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| Europe | 121,637 | 11.6 | 125,266 | 11.9 | 3,629 | 103 | |
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| Others | 14,538 | 1.4 | 14,229 | 1.4 | (309) | 98 | |
| Total overseas revenue | 509,548 | 48.5 | 488,307 | 46.5 | (21,241) | 96 | ||
Consolidated total | 1,050,982 | 100.0 | 1,050,764 | 100.0 | (218) | 100 | |||
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 first quarter of 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.
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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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