First Quarter of FY 2019

Consolidated Financial Results

Japan Display Inc.

August 9, 2019

Summary of 1Q-FY19

  • Q1 sales were only ¥90.4bn yen due to a continued severe competitive environment, customer inventory adjustments and reduced demand seen as the result of US-China trade tensions.
  • Behind the operating loss of ¥27.5bn was a worse cost ratio due to a decline in sales and a decline in plant utilization stemming from less demand. (In the 1H of FY18, plant utilization was high due to production brought forward in anticipation of a large increase in 2H demand, which had a positive effect on operating income.)
  • Equity-methodinvestment loss of ¥2.03bn related to JOLED (non-operating expenses). In view of customer demand trends, ¥51.7bn in business structural improvement expenses was recorded as an extraordinary loss, incl. an impairment loss of ¥51.4bn on assets related to the Hakusan Plant.
  • Due to these factors, at the end of the Q1 liabilities exceeded assets (minus ¥77.2bn yen).

(Billion yen)

Net

Operating

Ordinary

Net

Dep. &

R&D

FX rate

sales

income

income

income

Amort.

expense

(/US$)

Q1-FY19

90.4

(27.5)

(31.6)

(83.3)

7.5

2.8

109.9

Q4-FY18

171.3

(20.4)

(24.4)

(98.6)

11.4

4.8

110.2

Q1-FY18

103.3

(9.8)

(12.7)

(1.8)

12.1

4.1

109.1

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Quarterly Sales by Region & Business Category

Sales Status

Quarterly Sales Development

■ Mobile

  • Sales down sharply QoQ in Q1 due to reduced demand for smartphone displays, considered to be the result of customer inventory adjustments and US-China trade tensions.
  • JDI decides to downsize the mobile business due to no prospect of a significant recovery in future demand (announced June 12)
  • Automotive
  • Car sales continue to fall YoY in Q1, led by China, but also in US /Europe, so JDI sales also fell.
  • The same trend continues in Q2, but improvement looks possible from Q3 onward.
  • Non-mobile
  • Lower sales for high-end notebook PCs in Q1 due to US-China trade tensions; DSC also weak.
  • Focus on launching new businesses from 2H.

US/ Euro

Mobile

China

Other regions

251.1

Non-mobile

Automotive

171.3

75%

103.3

111.0

66%

91.0

36%

39%

42%

18%

18%

7%

6%

14%

6%

3%

1%

2%

4%

11%

15%

6%

9%

12%

28%

25%

11%

17%

28%

1Q18

2Q18

3Q18

4Q18

1Q19

Copyright © 2019 Japan Display Inc. All Rights Reserved. 3

1Q-FY19 Operating Results

(Billion yen)

Q1-FY19

Q1-FY18

YoY Chg.

Q4-FY18

QoQ Chg.

Net sales

90.4

103.3

(12.9)

－12.5%

171.3

(80.9)

－47.2%

Cost of sales

107.7

102.1

+5.6

＋5.5%

178.9

(71.3)

－39.8%

Gross profit (loss)

(17.3)

1.2

(18.5)

-

(7.6)

(9.7)

-

-19.1%

1.2%

-4.4%

SG&A

10.2

11.0

(0.8)

－7.3%

Operating income (loss)

(27.5)

(9.8)

(17.7)

-

12.7 (2.5) －19.9%

(20.4)

(7.1)

-

Net non-op. income (expenses)

-30.4%

-9.5%

(4.1)

(2.9)

(1.2)

Ordinary income (loss)

(31.6)

(12.7)

(18.9)

-11.9%

-

(4.1)

(0.1)

-

-

(24.4)

(7.2)

-

-35.0%

-12.3%

Net extraordinary income (loss)

(51.7)

11.9

(63.6)

Income (loss) before income taxes

(83.3)

(0.8)

(82.5)

-14.3%

-

(74.5)

+22.8

-

-

(98.9)

+15.6

-

-92.1%

-0.7%

-57.7%

Income taxes

(0.1)

0.9

(1.0)

(0.2)

+0.0

Net income (loss) attributable to

(83.3)

(1.8)

(81.5)

-

(98.6)

+15.3

-

owners of the parent

-92.1%

-1.7%

-57.5%

EBITDA

(20.2)

2.0

(22.2)

-

(9.3)

(10.8)

-

-22.3%

2.0%

-5.5%

Avg. FX rate (JPY/USD)

109.9

109.1

110.2

Q-End FX rate (JPY/USD)

107.8

110.5

111.0

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1Q-FY19 Operating Profit Change Factors

(billion yen)

vs. Previous year (1Q-FY18)

vs. Previous quarter (4Q-FY18)

Sales

Sales

103.3

90.4

171.3

90.4

(9.8)

(27.5)

(20.4)

(27.5)

(7.2) ＋5.2

＋0.1 ＋0.8

＋3.2 ＋4.8

＋2.5

(16.5)

(0.3)

(17.4)

1Q

Shipment

Mfg.

Inventory FX SGA 1Q

4Q

volume &

fixed

impact

FY19

FY18

FY18 productmix

cost

Shipment

Mfg.

Inventory FX

SGA 1Q

volume &

fixed

impact

FY19

product

mix

cost

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Japan Display Inc. published this content on 10 August 2019 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 10 August 2019 10:40:04 UTC