Commencing from the beginning of its fiscal year ending March 31, 2019 ("FY19"), Kyocera has adopted the International Financial Reporting Standards ("IFRS") in lieu of the Generally Accepted Accounting Principles of the United States of America ("U.S.GAAP"). In addition, financial figures appearing herein for the nine months ended September 30, 2017 ("FY18 1Q-3Q") and the year ended March 31, 2018 ("FY18") have been reclassified in accordance with IFRS for the purpose of comparative analysis.
Sales revenue for FY19 1Q-3Q increased by 6.1% compared with FY18 1Q-3Q, marking record highs in sales for this nine-month period for two consecutive years. Sales increased in the Electronic Devices Group and the Industrial & Automotive Components Group as well as the Document Solutions Group due in part to contributions from aggressive merger and acquisition activities conducted from fiscal 2018.
Profits decreased as compared with FY18 1Q-3Q, due to the recording of settlement expenses in the amount of 52,313 million yen relating to long-term purchase agreements for procurement of polysilicon material in the solar energy business and to the recording of impairment loss relating to machinery, equipment and goodwill in the organic materials business in the amount of 16,184 million yen, which more than offset the effects of increased sales revenue and cost reductions efforts in each division.
For this reason, operating profit decreased by 44.1%, profit before income taxes decreased by 29.3%, and profit attributable to owners of the parent decreased by 14.7% compared with FY18 1Q-3Q.
Demand for components in the Components Business during the fourth quarter(FY19 4Q) is expected to slow due to production adjustments in the smartphone market and to the impact of restrained capital investment in the industrial equipment market. Kyocera has also revised down its forecast sales revenue for the Equipment & Systems Business for FY 19 because sales in the Document Solutions Group and the solar energy business in the Life & Environment Group for FY19 3Q and for FY19 4Q will not achieve that forecast in its previous projections.
Given these conditions, Kyocera also forecasts profits to fall below previous projections due to the recording of impairment loss in the organic materials business in FY19 3Q despite efforts to reduce costs and to maintain profitability in each division.(Published on Feruary 1, 2019)