Fujitsu : FY 2020 First Quarter Financial Results

July 30, 2020

FY 2020 First Quarter Financial Results

April 1, 2020 - June 30, 2020

Fujitsu Limited

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Consolidated Financial Results for the First-QuarterEnded June 30, 2020[Prepared on the basis of International Financial Reporting Standards]

		July 30, 2020
Company name	:	Fujitsu Limited
Stock exchange listings	:	Tokyo, Nagoya
Code number:	:	6702
URL:	:	https://www.fujitsu.com/global/
Representative:	: Takahito Tokita, President and Representative Director
Contact person:	: Isamu Yamamori, Corporate Executive Officer, SVP,
		Head of Public and Investor Relations Division
		Tel. [phone]
Scheduled filing date of statutory financial report:	:	August 3, 2020
Scheduled dividend payment date:	:	-
Supplementary material:	:	Yes
Financial results meeting:	: Yes (for media and analysts)

1. Consolidated Results for the First-Quarter Ended June 30, 2020

(Monetary amounts are rounded to the nearest million yen.)

(1) Consolidated financial results

(The percentage figures represent the percentage of increase or decrease against the same period of the previous year.)

(Millions of yen)

	Revenue	Operating profit	Profit before income	Profit for the period
		Change (%)		Change (%)	taxes	Change (%)		Change (%)
1Q FY 2020	802,793	-4.3	22,273	558.0	25,951	314.4	19,152	244.0
(4/1/20-6/30/20)
1Q FY 2019	838,737	-3.3	3,385	-95.7	6,263	-93.5	5,567	-92.7
(4/1/19-6/30/19)
	Profit for the period attributable	Total comprehensive income for
	to owners of	Change (%)	the period	Change (%)
	the parent
1Q FY 2020	18,176	156.2	15,487	-
(4/1/20-6/30/20)
1Q FY 2019	7,094	-90.2	1,300	-98.2
(4/1/19-6/30/19)
		(Yen)
	Earnings per share
	Basic	Diluted
1Q FY 2020	90.77	90.72
(4/1/20-6/30/20)
1Q FY 2019	35.00	34.98
(4/1/19-6/30/19)

(2) Consolidated financial position

(Millions of yen)

			Equity	Equity
	Total assets	Total equity	attributable to	attributable to
	owners of the	owners of the
			parent	parent ratio (%)
June 30, 2020	2,985,074	1,343,561	1,234,868	41.4%
March 31, 2020	3,187,455	1,348,435	1,240,956	38.9%

2. Dividends per Share (Ordinary Shares)

							(Yen)
			Dividends per share
	1Q		2Q	3Q		Year-end	Full year
FY2019		-	80.00	-		100.00	180.00
FY2020		-
FY2020(Forecast)			100.00	-		100.00	200.00

Note: Revision of the latest dividends forecast: Yes

3. Consolidated Earnings Forecast for FY2020

(The percentage figures represent the percentage of increase or decrease against the previous year.)

(Millions of yen, except per share data)

	Revenue	Operating profit	Profit for the year attributable		Basic
		Change (%)		Change (%)	to owners of	Change (%)		earnings per
			the parent		share
FY2020	3,610,000	-6.4	212,000	0.2	160,000		-	799.02

Note: Revision of the latest consolidated earnings forecast: Yes

4. Other Information

(1) Significant changes to subsidiaries in the current reporting period

(Changes to specified subsidiaries resulting from changes in scope of consolidation): No

1. Changes in accounting policies and accounting estimates

1. Changes in accounting policies required by IFRS: None
2. Changes arising from factors other than 1: None
3. Changes in accounting estimates: None

1. Number of issued shares (ordinary shares)

1.	Number of issued shares	As of June 30, 2020	207,001,821
	at end of period	As of March 31, 2020	207,001,821
2.	Treasury stock held	As of June 30, 2020	6,755,991
	at end of period	As of March 31, 2020	6,754,157
3.	Average number of shares	1Q FY 2020	200,246,583
	during period	1Q FY 2019	202,682,602

Notes

1. This financial report is not subject to quarterly review
2. Precautions on usage of earnings projections

These materials may contain forward-looking statements that are based on management's current information, views and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. Actual results may differ materially from those projected or implied in the forward-looking statements due to, without limitation, the following factors listed below.

- General economic and market conditions in key markets

(Particularly in Japan, Europe, NorthAmerica, Oceania, and Asia, including China)

• Fluctuations in exchange rates or interest rates
• Fluctuations in capital markets
• Intensifying price competition
• Changes in market positioning due to competition in R&D
• Changes in the environment for the procurement of parts and components
• Changes in competitive relationships due to collaborations, alliances and technical provisions
• Risks related to public regulations, public policy and tax matters
• Risks related to product or services defects
• Potential emergence of unprofitable projects
• Risks related to R&D investments, capital expenditures, business acquisitions, business restructuring, etc.
• Risks related to natural disasters and unforeseen events
• Changes in accounting policies

For information regarding the assumptions used to prepare these projections, please refer to the supplemental explanation materials (Presentation Material).

Financial Tables

1. Consolidated Statement of Financial Position

				(Millions of yen)
	Notes	FY2019		1Q FY2020
		(As of March 31, 2020)		(As of June 30, 2020)
Assets
Current assets
Cash and cash equivalents		451,857	568,907
Trade receivables		879,454	535,186
Other receivables		93,428	79,010
Inventories		238,070	249,654
Others		214,130	279,058
Subtotal		1,876,939		1,711,815
Assets held for sale		14,182	11,379
Total current assets		1,891,121		1,723,194
Non-current assets
Property, plant and equipment, net of accumulated depreciation		570,170	561,958
Goodwill		36,709	38,438
Intangible assets		107,213	108,564
Investments accounted for using the equity method		150,719	152,441
Other investments		131,765	143,662
Deferred tax assets		106,636	89,067
Others		193,112	167,750
Total non-current assets		1,296,324		1,261,880
Total assets		3,187,445	2,985,074
Liabilities and equity
Liabilities
Current liabilities
Trade payables		478,970	396,806
Other payables		390,917	297,202
Short-term borrowings, current portion of long-term debt		199,450	239,626
and lease obligations
Accrued income taxes		50,652	4,336
Provisions		51,769	50,648
Others		192,767	237,697
Subtotal		1,364,525		1,226,315
Liabilities directly associated with assets held for sale		1,083	650
Total current liabilities		1,365,608		1,226,965
Non-current liabilities
Long-term debt and lease obligations		206,119	169,593
Retirement benefit liabilities		190,353	180,160
Provisions		30,652	28,525
Deferred tax liabilities		10,370	6,013
Others		35,908	30,257
Total non-current liabilities		473,402		414,548
Total liabilities		1,839,010		1,641,513
Equity
Share capital		324,625	324,625
Capital surplus		237,654	237,841
Treasury stock, at cost		-59,614	-59,635
Retained earnings		735,920	720,487
Other components of equity		2,371		11,550
Total equity attributable to owners of the parent		1,240,956	1,234,868
Non-controlling interests		107,479	108,693
Total equity		1,348,435		1,343,561
Total liabilities and equity		3,187,445	2,985,074

― 1 ―

2.Condensed Consolidated Statement of Profit or Loss and Condensed Consolidated Statement of Comprehensive Income

【First-Quarter Condensed Consolidated Statement of Profit or Loss】	(Millions of yen, except per share data)
			1Q FY2019		1Q FY2020
	Notes	(For the three-month		(For the three-month
			ended June 30, 2019)		ended June 30, 2020)
	Revenue	838,737	802,793
	Cost of sales	-613,359	-578,933
	Gross profit	225,378		223,860
	Selling, general and administrative expenses	-216,181	-202,600
	Other income	3,528	4,900
	Other expenses	-9,340		-3,887
	Operating profit	3,385	22,273
	Financial income	3,303	3,213
	Financial expenses	-1,765	-1,091
	Income from investments accounted for using the equity method, net	1,340	1,556
	Profit for the period before income taxes	6,263		25,951
	Income tax expenses	-696		-6,799
	Profit for the period	5,567	19,152
Profit for the period attributable to:
	Owners of the parent	7,094	18,176
	Non-controlling interests	-1,527		976
	Total	5,567	19,152
	Earning per share
	Basic earnings per share (Yen)	35.00	90.77
	Diluted earnings per share (Yen)	34.98	90.72
【First-QuarterCondensed Consolidated Statement of Comprehensive Income】		(Millions of yen)
			1Q FY2019		1Q FY2020
	Notes	(For the three-month		(For the three-month
			ended June 30, 2019)		ended June 30, 2020)
	Profit for the period		5,567	19,152
	Other comprehensive income
	Items that will not be reclassified to profit or loss

Financial assets measured at fair value through other comprehensive income

Remeasurement of defined benefit plans

Share of other comprehensive income of investments accounted for using the equity method

Items that may be reclassified subsequently to profit or loss

Foreign currency translation adjustments

Cash flow hedges

Share of other comprehensive income of investments accounted for using the equity method

3,681

-193-120

3,368

-7,652-169

186

-7,635

7,096

-14,103 81

-6,926

2,167 -22

1,116

3,261

Total other comprehensive income for the period, net of taxes

Total comprehensive income for the period Total comprehensive income attributable to:

Owners of the parent Non-controlling interests Total

-4,267	-3,665
1,300	15,487
3,444	14,285
-2,144		1,202
1,300	15,487

― 2 ―

3. Condensed Consolidated Statement of Changes in Equity

(Millions of yen)

			Equity attributable to owners of the parent
Notes	Share		Capital		Treasury		Retained		Other				Non-
		stock,			components		Total		controlling		Total equity
	capital		surplus			earnings
			at cost			of equity				interests
Balance at April 1, 2019	324,625	235,455	-29,556	576,857	24,674	1,132,055	121,575	1,253,630
Profit for the period						7,094			7,094	-1,527	5,567
Other comprehensive								-3,650	-3,650	-617	-4,267
income
Total comprehensive
－		－		－	7,094	-3,650	3,444	-2,144	1,300
income for the period
Purchase of treasury stock				-13					-13			-13
Share-based payment		106							106			106
transactions
Dividends paid						-16,214			-16,214	-1,830	-18,044
Transfer to retained						2	-2		－				－
earnings
Others		-577			499	-1	-79	-52	-131
Balance at June 30, 2019	324,625	234,984	-29,569	568,238	21,021	1,119,299	117,549	1,236,848
													(Millions of yen)
			Equity attributable to owners of the parent
Notes	Share		Capital		Treasury		Retained		Other				Non-
		stock,			components		Total		controlling		Total equity
	capital		surplus			earnings
			at cost			of equity				interests
Balance at April 1, 2020	324,625	237,654	-59,614	735,920	2,371	1,240,956	107,479	1,348,435
Profit for the period						18,176			18,176	976	19,152
Other comprehensive								-3,891	-3,891	226	-3,665
income
Total comprehensive
－		－		－	18,176	-3,891	14,285	1,202	15,487
income for the period
Purchase of treasury stock				-22					-22			-22
Share-based payment		307							307			307
transactions
Dividends paid						-20,024			-20,024	-1,317	-21,341
Transfer to retained						-13,070	13,070		－				－
earnings
Others		-120	1	-515			-634	1,329	695
Balance at June 30, 2020	324,625	237,841	-59,635	720,487	11,550	1,234,868	108,693	1,343,561

― 3 ―

4.Condensed Consolidated Statements of Cash Flows

			(Millions of yen)
	1Q FY2019		1Q FY2020
Notes	(For the three-		(For the three-
month ended		month ended
	June 30, 2019)		June 30, 2020)
Cash flows from operating activities
Profit for the period before income taxes	6,263	25,951
Depreciation, amortization and impairment loss	55,284	40,791
Increase (decrease) in provisions	-11,078	-4,353
Increase (decrease) in net defined benefit liability	-10,046	-6,162
Interest and dividend income	-2,865	-2,048
Interest charges	1,035	818
Income from investments accounted for using the equity method, net	-1,340	-1,556
(Gain) loss on sales of subsidiaries' stock	307		－
(Increase) decrease in trade receivables	335,554	345,109
(Increase) decrease in inventories	-55,061	-11,783
Increase (decrease) in trade payables	-82,588	-82,751
Other, net	-110,225	-113,516
Cash generated from operations	125,240	190,500
Interest received	692	317
Dividends received	3,121	2,454
Interest paid	-1,056	-792
Income taxes paid	-11,617	-43,580
Net cash provided by operating activities	116,380	148,899
Cash flows from investing activities
Purchases of property , plant, equipment, and intangible assets	-26,083	-26,225
Proceeds from sales of investment securities	12,270	2,844
Net proceeds from sale of subsidiaries and business	-648	9,530
Collection of loans receivable	484	11,089
Decrease (increase) in short-term investment	366	-4,900
Other, net	2,854	-2,345
Net cash used in investing activities	-10,757	-10,007
Cash flows from financing activities
Increase (decrease) in short-term borrowings	18,948	14,620
Proceeds from long-term debt and issuance of bonds	3	132
Repayment of long-term debt and bonds	-40,059	-48
Payment of lease obligation	-16,480	-16,866
Purchase of treasury stock	-13	-22
Dividends paid to owners of the parent	-16,214	-20,024
Other, net	-1,601	-1,623
Net cash used in financing activities	-55,416	-23,831
Net increase (decrease) in cash and cash equivalents	50,207		115,061
Cash and cash equivalents at beginning of period	416,742	453,036
Effect of exchange rate changes on cash and cash equivalents	-438	1,586
Cash and cash equivalents at end of period	466,511	569,683

― 4 ―

1. Notes to Financial Statements

1. Cautionary Note Regarding Assumptions of a Going Concern
   None.

― 5 ―