Musical Instruments Business Remained Solid, Revenue and Profit Decreased Year-on-Year Due to Deteriorating Market Conditions for Industrial Machinery/Components Business and the Exchange Rate.

Through the third quarter of FY2020.3 (April 1, 2019 to December 31, 2019), revenue decreased JPY9.1 billion (-2.7%) year on year, to JPY322.6 billion, as a result of deteriorating market conditions for the industrial machinery/components business and a negative impact of JPY11.2 billion due to the exchange rate. On the other hand, the mainstay musical instruments business remained solid. Core operating profit decreased JPY2.5 billion (-5.5%) to JPY42.4 billion due to deteriorating industrial machinery/components business and a negative impact of JPY5.2 billion due to the exchange rate; and profit for the period attributable to owners of the parent deceased JPY0.9 billion (-2.8%) to JPY32.7 billion.

? Revenue and Profit/Loss by Reportable Segment Figures in parentheses are percentage changes from the same period of the previous fiscal year, except as indicated.

Musical Instruments Revenue of JPY213.3 billion (+0.1%) and Core Operating Profit of JPY34.8 billion (+3.1%) Sales in Japan decreased affected by the consumption tax hike, but sales in other regions were strong. Sales of acoustic pianos continued double-digit growth in China and also sales expanded in Europe and other emerging countries. Sales of digital musical instruments and wind instruments continued to be strong in all regions, excluding Japan. Sales of guitars also achieved double-digit growth due to sales increases in all regions.

Overall revenues for the segment were up JPY0.1 billion to JPY213.3 billion, absorbing a negative impact of JPY7.8 billion due to the exchange rate year on year. Core operating profit increased JPY1.0 billion to JPY34.8 billion, also absorbing a negative impact of JPY3.9 billion due to the exchange rate.

Audio Equipment Revenue of JPY86.2 billion (-4.9%) and Core Operating Profit of JPY7.1 billion (-12.3%) For professional audio equipment business, in addition to sales increases in all regions, audio equipment installation in Japan was favorable, while sales of audio equipment and ICT equipment were sluggish.

Overall revenue in this segment decreased JPY4.4 billion year on year to JPY86.2 billion, including a negative impact of JPY3.2 billion due to the exchange rate. Core operating profit decreased JPY1.0 billion year on year to JPY7.1 billion, reflecting a negative impact of JPY1.3 billion due to the exchange rate.

Industrial Machinery/Components and Others Revenue of JPY23.1 billion (-17.3%) and Core Operating Profit of JPY0.5 billion (-84.5%) Although sales of electronic devices recovered, sales of factory automation (FA) equipment declined due to continued sluggish market conditions.

Overall revenues in this segment decreased JPY4.8 billion year on year to JPY23.1 billion and core operating profit decreased JPY2.5 billion to JPY0.5 billion.

? Outlook for Performance in FY2020.3 Downward Revisions to Previous Forecasts, Incorporating Sales Trends and a Level of Uncertainty about the Future The Company's forecasts for consolidated performance for the full fiscal year ending March 31, 2020, announced on November 1, projected revenue of JPY435.0 billion (+0.1%), core operating profit of JPY53.0 billion (+0.5%), and profit for the period attributable to owners of the parent of JPY41.5 (+2.9%). Accordingly, the Company revised revenue to JPY425.0 billion (-2.2%), core operating profit to JPY50.0 billion (-5.2%), and profit for the period attributable to owners of the parent to JPY39.5 (-2.1%), reflecting the sales trends through the third quarter and incorporating a level of uncertainty about the future such as concerns about the spread of the new coronavirus in China.

For reference, results for the fiscal year ended March 2019 based on IFRS were: JPY434.4 billion in revenue, JPY52.7 billion in core operating profit, and JPY40.3 billion in profit for the period attributable to owners of the parent.

Note that the foreign currency exchange rates used in computing these forecasts for the fourth quarter are JPY110 to US$1 and JPY120 to EUR1.

Notes: 1.	The Company has applied the International Financial Reporting Standards (IFRS) from the first quarter of FY2020.3. Financial figures through the previous third quarter and the previous fiscal year are also presented in accordance with IFRS.
2.	Core operating profit corresponds to operating income under Japanese GAAP and is calculated by subtracting selling, general and administrative expenses from gross profit.
3.	Figures less than JPY100 million for revenue and profit and loss in the text of this release have, in principle, been rounded to the nearest JPY100 million.

For further information, please contact:

Yamaha Corporation

Corporate Communications Division, Media Relations Group

Contact form: https://inquiry.yamaha.com/contact/?act=55&lcl=en_WW

Telephone: +81-3-5488-6601 / Facsimile: +81-3-5488-5060

(1)	Key Financial Indicators (Billions of yen)

Previous Projections

(Full Year)

(Announced on Nov. 1, 2019)

Revenue 118.4 114.1 331.7 322.6 434.4 425.0 435.0

Japan 30.5 (25.7%) 28.3 (24.8%) 94.7 (28.5%) 90.2 (28.0%) 129.8 (29.9%) 126.5 (29.8%) 127.0 (29.2%)

Overseas 88.0 (74.3%) 85.8 (75.2%) 237.0 (71.5%) 232.4 (72.0%) 304.6 (70.1%) 298.5 (70.2%) 308.0 (70.8%)

Core Operating Profit (*1) 18.2 (15.3%) 16.3 (14.2%) 44.9 (13.5%) 42.4 (13.1%) 52.7 (12.1%) 50.0 (11.8%) 53.0 (12.2%)

Operating Profit 18.8 (15.8%) 16.5 (14.4%) 45.3 (13.7%) 44.0 (13.6%) 52.8 (12.2%) 51.5 (12.1%) 54.5 (12.5%)

Profit before Income Tax 18.3 (15.5%) 16.6 (14.5%) 47.5 (14.3%) 45.5 (14.1%) 56.5 (13.0%) 54.5 (12.8%) 57.0 (13.1%)

Net Profit (*2) 12.5 (10.5%) 11.6 (10.2%) 33.7 (10.1%) 32.7 (10.1%) 40.3 (9.3%) 39.5 (9.3%) 41.5 (9.5%)

Currency Exchange Rate (*3) 113/US$ 109/US$ 111/US$ 109/US$ 111/US$ 109/US$ (*7) 110/US$

(Settlement Rate) (=yen) 132/EUR 119/EUR 132/EUR 122/EUR 131/EUR 122/EUR 122/EUR

ROE (*4) 13.4% 12.9% 12.3% 12.1% 11.1% 10.9% 11.3%

ROA (*5) 9.1% 8.9% 8.3% 8.4% 7.5% 7.6% 7.9%

Basic Profit per Share 68.7yen 65.2yen 185.1yen 183.5yen 222.1yen 222.1yen 232.6yen

Capital Expenditures 2.5 4.5 10.5 11.7 16.0 20.0 22.0

(Depreciation Expenses) (2.8) (2.9) (8.2) (8.3) (10.6) (11.2) (12.7)

R&D Expenses 6.4 6.1 18.6 18.4 24.9 25.0 26.5

Cash Flows

Operating Activities 4.2 21.3 11.4 40.3 35.5 57.0 59.0

Investing Activities -4.6 -7.6 -17.9 -13.0 -23.1 -21.0 -20.0

Free Cash Flow -0.5 13.8 -6.5 27.3 12.4 36.0 39.0

Inventories at End of Period - - 102.4 103.6 101.0 99.0 99.0

Number of Employees

Japan - - 5,793 5,685 5,736 5,600 5,700

Overseas - - 14,599 14,723 14,639 14,700 15,400

Total (*6) - - 20,392 20,408 20,375 20,300 21,100

?Changes from the changes in

the scope of consolidation? - ---- --

Temporary Staff

(Average during the period) - - 7,960 8,068 7,733 8,100 7,800

Revenue by Business

Segment

Musical Instruments 75.4 (63.7%) 74.7 (65.5%) 213.2 (64.3%) 213.3 (66.1%) 279.5 (64.3%) 277.5 (65.3%) 281.0 (64.6%)

Audio Equipment 34.3 (28.9%) 31.7 (27.7%) 90.6 (27.3%) 86.2 (26.7%) 120.1 (27.7%) 116.5 (27.4%) 121.0 (27.8%)

Others 8.8 (7.4%) 7.7 (6.8%) 27.9 (8.4%) 23.1 (7.2%) 34.8 (8.0%) 31.0 (7.3%) 33.0 (7.6%)

Core Operating Profit by

Business Segment

Musical Instruments 13.3 12.5 33.8 34.8 40.8 41.5 43.0

Audio Equipment 4.0 3.5 8.1 7.1 9.6 8.5 10.0

Others 0.8 0.3 3.0 0.5 2.3 0.0 0.0

(2)	Revenue by Business Segment and Region (Billions of yen)

(April-Dec, 2019) Revenue Change (*8) Revenue Change (*8) Revenue Change (*8) Revenue Change (*8)

??Japan 53.0 95% 19.9 108% 17.3 85% 90.2 95%

??North America 44.2 105% 20.9 93% 2.7 128% 67.8 102%

??Europe 39.7 106% 24.2 101% 0.2 63% 64.1 104%

86%

(100%)

??Asia, Oceania,

??and other areas 37.9 106% 14.6 99% 1.8 70% 54.4 102%

99%

(100%)

Nine Months Results

Ended Dec. 31, 2019

Third Quarter of FY2020.3 Performance Outline

February 6, 2020

Three Months Results

Ended Dec. 31, 2018

Three Months Results

Ended Dec. 31, 2019

Nine Months Results

Ended Dec. 31, 2018

Nine Months Results

Ended Dec. 31, 2019

Results

(Previous Year)

Projections

(Full Year)

FY2019.3 FY2020.3 FY2019.3 FY2020.3 FY2019.3 FY2020.3 FY2020.3

Consolidated financial forecasts were prepared based on information available at the time of the announcement and do not represent promises by the Company or its management that these

performance figures will be attained. Actual consolidated results may differ from forecasts owing to a wide range of factors.

Musical Instruments Audio Equipment Others Total

??China 103%

Total 213.3 104% 86.2 23.1 83% 322.6 101%

38.5 111% 6.5 1.1 45% 46.1

The Yamaha Group has applied the International Financial

Reporting Standards (IFRS) from the first quarter of fiscal year

ending March 31, 2020 (FY2020.3).

*1 Core operating profit is corresponding to operating income under the

Japanese GAAP, and is calculated deducting SG&A from gross profit.

*2 Net profit is presented as net profit attributable to owners of the parent

under IFRS standards.

*3, 7 Currency exchange rate is the export and import transaction rate

applied to profit calculation.

4Q Currency Exchange Rates US$=110JPY EUR=120JPY

*4, 5 ROE and ROA are calculated on an annually adjusted basis.

*6 Number of employees = Number of full-time staff at end of the period

*8 The Change indicates actual year-on-year changes discounting impact of

exchange rates and figures in parenthesis show actual year-on-year change

excluding the sales of OEM products

(C) 2020 Electronic News Publishing, source ENP Newswire