TOKYO, Japan, October 27, 2010 — Renesas Electronics Corporation (TSE: 6723), a premier supplier of advanced semiconductor solutions, today announced the difference between its financial forecasts, which it disclosed on July 29, 2010, and the actual results, which it disclosed today, for the first half of the fiscal year (the period from April 1 to September 30, 2010).
Renesas Electronics also announced that it has revised its consolidated financial forecasts for the full year (the period from April 1, 2010 to March 31, 2011), which it disclosed on July 29, 2010.
1. Difference between the forecasts and the actual financial results for the first half consolidated financial results
(For the six months ended September 30, 2010)
In millions of yen
| Net Sales | Operating Income (loss) | Ordinary Income (Loss) | Net Income (Loss) | Net Income (Loss) per Share (Yen) | |
|---|---|---|---|---|---|
| Previous forecasts (As of July 29) | 590,000 | (2,000) | (8,000) | (42,000) | (100.69) |
| Actual results | 587,468 | 729 | (7,802) | (41,241) | (98.87) |
| Increase (decrease) | (2,532) | 2,729 | 1,198 | 759 | – |
| Percent change | (0.4) | – | – | – | – |
Background to the difference
Renesas Electronics announced its consolidated first half results as follows: consolidated net sales for the six months ended September 30, 2010 totaled 587.5 billion yen and semiconductor sales totaled 542.5 billion yen. Operating income amounted to 0.7 billion yen; ordinary loss was 7.8 billion yen; and net loss totaled 41.2 billion yen. Although net sales were lower-than-expected, operating profit was better than the company's estimate of 2.0 billion yen loss, due to improvement of gross profit ratio and reduced R&D cost through steady execution of the measures formulated through the 100-day Project. Ordinary loss and net loss, on the other hand, only showed a little improvement due to the influence of exchange rate fluctuations, especially the stronger yen against the U.S. dollar.
2. Revised forecasts for the full-year consolidated financial results
(For the year ending March 31, 2011)
In millions of yen
| Net Sales | Operating Income (loss) | Ordinary Income (Loss) | Net Income (Loss) | Net Income (Loss) per Share (Yen) | |
|---|---|---|---|---|---|
| Previous forecasts (July 29, 2010) | 1,190,000 | 7,000 | (5,000) | (80,000) | (191.79) |
| Revised forecasts | 1,170,000 | 7,000 | (5,000) | (80,000) | (191.79) |
| Increase (decrease) | (20,000) | 0 | 0 | 0 | – |
| Percent change | (1.7) | – | – | – | – |
| Reference: Results for the year ended March 31, 2010 | 1,062,398 | (113,251) | (125,336) | (137,776) | – |
Note 1: The consolidated financial results for the year ended March 31, 2010 are calculated based on the sum of respective figures at the former NEC Electronics Corporation and the former Renesas Technology Corp. The amount of “Net sales” and “Sales from semiconductors” of former Renesas Technology Corp. are reclassified to be consistent with former NEC Electronics Corporation.
Background to the revision of full-year forecasts
As for the forecasts for the fiscal year ending March 31, 2011: net sales are expected to be 1,170.0 billion yen, 20.0 billion yen down from the previous forecast (announced on July 29, 2010); semiconductor sales are expected to be 1,050.0 billion yen, 40.0 billion yen down from the previous forecast; operating income is expected to be 7.0 billion yen; ordinary loss is expected to be 5.0 billion yen; and net loss is expected to be 80.0 billion yen. Forecasts of all of the income (loss) remain unchanged from the previous forecasts.
Semiconductor sales for the second half of the fiscal year ending March 31, 2011 (the period from October 1, 2010 to March 31, 2011) are expected to stay stagnant mainly due to the stronger yen especially against the U.S. dollar.
Operating income remained the same as the previous forecasts to be 7.0 billion yen. This is due to the slightly increasing operating income and the company's structural reforms decided through the 100-day Project as well as the early realization of the merger synergies, despite the lower profit from decrease in semiconductor sales.
Ordinary loss and net loss remained unchanged from the previous forecasts.
The consolidated financial forecasts for the fiscal year are calculated at the rate of 82 yen per USD, and 110 yen per Euro.
Forward-Looking Statements
The statements in this press release with respect to the plans, strategies and financial outlook of Renesas Electronics and its consolidated subsidiaries (collectively “we”) are forward-looking statements involving risks and uncertainties. We caution you in advance that actual results may differ materially from such forward-looking statements due to several important factors including, but not limited to, general economic conditions in our markets, which are primarily Japan, North America, Asia, and Europe; demand for, and competitive pricing pressure on, products and services in the marketplace; ability to continue to win acceptance of products and services in these highly competitive markets; and fluctuations in currency exchange rates, particularly between the yen and the U.S. dollar. Among other factors, downturn of the world economy; deteriorating financial conditions in world markets, or deterioration in domestic and overseas stock markets, may cause actual results to differ from the projected results forecast.
About Renesas Electronics Corporation
Renesas Electronics Corporation (TSE: 6723) delivers trusted embedded design innovation with complete semiconductor solutions that enable billions of connected, intelligent devices to enhance the way people work and live. A global leader in microcontrollers, analog, power and SoC products, Renesas provides comprehensive solutions for a broad range of automotive, industrial, infrastructure, and IoT applications that help shape a limitless future. Learn more at renesas.com. Follow us on LinkedIn, Facebook, Twitter, and YouTube.
The content in the press release, including, but not limited to, product prices and specifications, is based on the information as of the date indicated on the document, but may be subject to change without prior notice.