Consolidated Financial Results for the 1st Quarter Fiscal 2021
Olympus Corporation | Executive Officer and Chief Financial Officer | Chikashi Takeda | August 5, 2020
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- This material contains forward-looking statements that reflect management's current views, plans, and expectations based on information available at the time of preparation. These forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, future business decisions, and other internal and external factors that may cause the Company's actual results, performance, achievements, or financial position to be materially different from any future results expressed or implied by these forward-looking statements.
- Additionally, this information is subject to change without notice. Accordingly, other information should be used in addition to this material when making investment decisions.
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Page 2 1Q FY2021 Consolidated Financial Results
Highlights
1Q Consolidated Financial Results
Revenue: | Decreased significantly in all divisions due to COVID-19 |
But YoY decline in revenue slowed from May to June | |
Operating profit: | Achieved profitability even in challenging environment by |
controlling expenses | |
Mainstay Endoscopic Solutions Division (ESD) generated profit |
Full-Year Performance Forecasts
Consolidated performance forecasts remain undecided
Outlook remains uncertain due to continued spread of COVID-19 and it is difficult to make a reasonable estimate on our financial forecasts
Page 3 1Q FY2021 Consolidated Financial Results
Consolidated Financial Results and
01 Business Review for the 1Q of
Fiscal 2021 (FY Ending March 31, 2021)
1Q of Fiscal 2021 (1) Consolidated Financial Results
- Revenue: Decreased in all divisions due to COVID-19
- Operating profit: Maintained profitability driven by ESD despite challenging environment
1Q (Apr. to Jun.) | |||||
After foreign | |||||
(Billions of yen) | FY2020 | FY2021 | YoY | exchange | |
adjustment | |||||
181.9 | 142.4 | -22% | -19% | ||
Revenue | 1 | ||||
Gross profit | 116.7 | 87.3 | -25% | -22% | |
(% of revenue) | (64.2%) | (61.3%) | |||
Supplemental data
After foreign exchange and COVID-19 adjustment
-¥34.0 billion
-
Selling, general and administrative expenses | 101.1 | 84.6 | -16% | -14% | - | ||
(% of revenue) | (55.6%) | (59.4%) | |||||
Other income and expenses | -0.9 | -1.4 | - | - | - | ||
Operating profit | 14.7 | 1.2 | |||||
2 | -92% | -80% | -¥11.0 billion | ||||
(% of revenue) | (8.1%) | (0.8%) | |||||
Profit before tax | 13.6 | 0.2 | -98% | ||||
(Profit before tax Rate) | (7.5%) | (0.1%) | |||||
Profit(loss) attributable to owners of parent | 8.6 | -2.7 | -¥11.4 billion | ||||
(Profit attributable to owners of parent Rate) | (4.7%) | (-) | |||||
EPS | ¥6 | -¥2 |
Yen/U.S. dollar
Yen/U.S. Euro
JPY/CNY
¥110¥108
¥123¥118
¥16¥15
Dividend forecast for FY2021
Undecided
Page 5 1Q FY2021 Consolidated Financial Results
1Q of Fiscal 2021 (2) Endoscopic Solutions Division (ESD)
Revenue Operating Profit
(Billions of yen)
95.4
79.2
Revenue Revenue decreased due to COVID-19, but China showed growth of 3% (excl. FX)
Operating Achieved operating margin of approx. 20% (excl. FX) despite challenging
profit environment
1Q (Apr. to Jun.) | |||||||
After foreign | |||||||
(Billions of yen) | FY2020 | FY2021 | YoY | exchange | |||
adjustment | |||||||
Revenue | 95.4 | 79.2 | -17% | -14% | |||
Operating profit | 21.9 | 14.6 | -33% | -27% | |||
21.9 | |||||||
14.6 | Other income and | 0.2 | -0.4 | - | - | ||
expenses | |||||||
Operating margin | 23.0% | 18.5% | 19.4 % | ||||
Apr.-Jun. 2019 | Apr.-Jun. 2020 |
Page 6 1Q FY2021 Consolidated Financial Results
1Q of Fiscal 2021 (3) Therapeutic Solutions Division (TSD)
Revenue Operating Profit
(Billions of yen)
Revenue Revenue decreased in all regions with the number of elective procedures down
52.1
Operating Despite lower revenue, cost reductions led to profitability profit (loss)
38.1
1Q (Apr. to Jun.) | |||||||
After foreign | |||||||
(Billions of yen) | FY2020 | FY2021 | YoY | exchange | |||
adjustment | |||||||
Revenue | 52.1 | 38.1 | -27% | -24% | |||
Operating profit | 5.7 | 1.4 | -74% | -69% | |||
5.7 | Other income and | 0 | -0.3 | - | - | ||
expenses | |||||||
1.4 | Operating margin | 10.9% | 3.8% | 4.5% | |||
Apr.-Jun. 2019 | Apr.-Jun. 2020 |
Page 7 1Q FY2021 Consolidated Financial Results
1Q of Fiscal 2021 (4) Scientific Solutions Division (SSD)
Revenue Operating profit (loss)
(Billions of yen)
22.6
17.8
1.6
-1.6
Apr.-Jun. 2019 | Apr.-Jun. 2020 |
Revenue Revenue decreased due to COVID-19, but China showed growth
Operating Operating loss was posted due mainly to lower revenue profit (loss)
1Q (Apr. to Jun.)
After foreign | ||||
(Billions of yen) | FY2020 | FY2021 | YoY | exchange |
adjustment | ||||
Revenue | 22.6 | 17.8 | -21% | -18% |
Operating profit(loss) | 1.6 | -1.6 | -¥3.2 billion | -¥3.0 billion |
Other income and | -0.2 | -0.3 | - | - |
expenses | ||||
Operating margin | 7.3% | - | ||
Page 8 1Q FY2021 Consolidated Financial Results
1Q of Fiscal 2021 (5) Imaging Division (IMD)
Revenue Operating profit(loss) Revenue Revenue decreased due to COVID-19
(Billions of yen)
10.2
6.0
-2.3 | -2.7 |
Apr.-Jun. 2019 | Apr.-Jun. 2020 |
Operating | Operating loss expanded due mainly to lower revenue | |||
profit (loss) | ||||
1Q (Apr. to Jun.) | ||||
After foreign | ||||
(Billions of yen) | FY2020 | FY2021 | YoY | exchange |
adjustment | ||||
Revenue | 10.2 | 6.0 | -41% | -39% |
Mirrorless | 7.7 | 4.8 | -38% | -36% |
Compact | 1.2 | 0.6 | -52% | -51% |
Others | 1.3 | 0.7 | -46% | -44% |
Operating profit (loss) | -2.3 | -2.7 | -¥0.4 billion | -¥0.5 billion |
Other income and | -0.5 | -0.2 | - | - |
expenses | ||||
Operating margin | - | - | - | |
Page 9 1Q FY2021 Consolidated Financial Results
Statement of Financial Position
Secured cash balance for stable business operations
Bonds/loans increased due to increase in long-term borrowings and issuance of CP
(Billions of yen) | End of Mar. End of June | Change | |
2020 | 2020 | ||
Current assets | 506.7 | 604.4 | +97.7 |
Inventories | 167.6 | 183.3 | +15.7 |
Non-current assets | 509.0 | 494.7 | -14.3 |
Property, plant and equipment | 202.1 | 201.3 | -0.8 |
Intangible assets and others | 208.5 | 196.0 | -12.5 |
Goodwill | 98.3 | 97.4 | -1.0 |
Total assets | 1,015.7 | 1,099.1 | +83.4 |
End of Mar. End of June | Change | ||
2020 | 2020 | ||
Current liabilities | 333.8 | 344.4 | +10.6 |
Bonds/loans payable | 81.0 | 111.9 | +30.9 |
Non current liabilities | 309.9 | 392.7 | +82.8 |
Bonds/loans payable | 199.9 | 284.0 | +84.1 |
Equity | 372.0 | 362.0 | -10.0 |
(Equity ratio) | 36.5% | 32.8% | -3.7pt |
Total liabilities and equity | 1,015.7 | 1,099.1 | +83.4 |
Interest-bearing debt: ¥395.9 billion (up ¥115.0 billion from March 31, 2020)
Page 10 1Q FY2021 Consolidated Financial Results
Consolidated Cash Flows
FCF: Minus ¥3.9 billion due to lower operating profit
Financial CF: Plus ¥111.8 billion due to increase in long-term borrowings
1Q (Apr. - Jun.) | |||
(Billion of yen) | FY2020 | FY2021 | Change |
Revenue | 181.9 | 142.4 | -39.5 |
Operating profit | 14.7 | 1.2 | -13.5 |
(% of revenue) | 8.1% | 0.8% | -7.3pt |
CF from operating activities | 28.4 | 8.4 | -20.0 |
CF from investing activities | -15.5 | -12.3 | +3.2 |
Free cash flow | 12.9 | -3.9 | -16.8 |
CF from financing activities | -11.3 | 111.8 | +123.1 |
Cash and cash equivalents at end of period | 113.7 | 270.7 | +156.9 |
Page 11 1Q FY2021 Consolidated Financial Results
Updates: January to June
Revenue has been on a downward trend since February due to COVID-19, but the decline slowed from May to June.
It is difficult to make a reasonable estimate on our financial forecasts
YoY Revenue Comparison*
120% | |||||||
110% | |||||||
100% | |||||||
90% | |||||||
80% | |||||||
70% | |||||||
60% | |||||||
50% | |||||||
40% | |||||||
30% | |||||||
January | February | March | April | May | June | ||
* After foreign exchange adjustment | ESD | TSD | SSD | IMD |
Page 12 1Q FY2021 Consolidated Financial Results
Initiatives for New Normal
Accelerate new-normal initiatives in sales promotion activities to support HCPs and customers
MedPresence*
- Real-timevirtual collaboration solution for clinical uses with high IT security technology
- Enterprise medical virtual presence solution, that enables teams to quickly bring needed expertise into a procedure space from across the organization, around the world, and at any time safely and securely
Online training and demonstrations
- Online training, demonstrations, seminars, etc. to support HCPs and customers even in COVID-19 pandemic environment
- Pursue new approaches to customers centered on digitization
Online demonstration for | Online | seminar for medical |
microscope | device | |
*Introduced in the US and Europe |
Page 13 1Q FY2021 Consolidated Financial Results
Committed to Corporate Reforms
FY2021
Great chance to accelerate transformation to a truly global medtech company for sustainable growth
Focus the | Structural reform | Successful launch of | Continued steady | Driving |
corporate | of fixed costs | next-gen GI endoscopy | investment in product | efficiency in our |
portfolio | system EVIS X1 | development for future | R&D operations | |
growth |
Olympus and Japan Industrial Partners signed a memorandum of understanding to transfer Olympus's Imaging Business
EVIS X1 has been launched in EMEA (Europe, Middle East & Africa), Australia, India and Hong Kong on April 23 and in Japan on July 3
Page 14 1Q FY2021 Consolidated Financial Results
Continue investments needed for sustainable growth
Securing liquidity of approx. ¥350-400 billion*
- Cash balance: approx. ¥270 billion**
- Issued ¥50 billion of corporate bonds (5yr and 10yr) in July
- In addition, commitment line of credit: approx. ¥100 billion
Strengthen business development activities
- Consider necessary M&A while strengthening financial flexibility
- As of the end of July 2020 **As of the end of June 2020
Page 15 1Q FY2021 Consolidated Financial Results
02 Appendix
Supplementary Materials: 1Q of Fiscal 2021 Factors that Affected Consolidated Operating Profit
14.7
FY2020
Operating profit
Decrease in
sales -21.3
Declined in all divisions due to COVID-19
COGS ratio worsened due to decline in factory operation
Changes in
cost of sales
-4.3
1Q (Apr.-Jun.)
Decrease in T&E and sales promotion expenses etc. due to COVID-19
Others
-0.5
Decrease in
SG&A expenses +14.4
1.2 | ||
Impact of | ||
FY2021 | ||
foreign | Operating profit | |
exchange | ||
-1.7 |
Page 18 1Q FY2021 Consolidated Financial Results
Supplementary Materials: 1Q of Fiscal 2021 by Segment
1Q (Apr. to Jun.)Supplemental data
After foreign | ||||||||
Billions of yen | FY2020 | FY2021 | YoY | After foreign exchange | exchange and | |||
adjustment | COVID-19 | |||||||
adjustment | ||||||||
ESD | Revenue | 95.4 | 79.2 | -17% | -14% | - | ||
Operating profit | 21.9 | 14.6 | -33% | -27% | - | |||
TSD | Revenue | 52.1 | 38.1 | -27% | -24% | - | ||
Operating profit | 5.7 | 1.4 | -74% | -69% | - | |||
SSD | Revenue | 22.6 | 17.8 | -21% | -18% | - | ||
Operating profit | 1.6 | -1.6 | -¥3.2 billion | -¥3.0 billion | - | |||
IMD | Revenue | 10.2 | 6.0 | -41% | -39% | - | ||
Operating profit | -2.3 | -2.7 | -¥0.4 billion | -¥0.5 billion | - | |||
Others | Revenue | 1.6 | 1.3 | -18% | -18% | - | ||
Operating profit | -0.6 | -0.4 | +¥0.2 billion | +¥0.2 billion | - | |||
Elimination and | Operating profit | -11.5 | -10.1 | +¥1.4 billion | +¥1.3 billion | - | ||
Corporate | ||||||||
Consolidated Total | Revenue | 181.9 | 142.4 | -22% | -19% | -¥34.0 billion | ||
Operating profit | 14.7 | 1.2 | -92% | -80% | -¥11.0 billion | |||
Page 19 1Q FY2021 Consolidated Financial Results
Supplementary Materials: Expenditures etc.
1Q (Apr. to Jun.)
(Billions of yen) | FY2020 | FY2021 | (Billions of yen) | FY2020 | FY2021 | ||||
21.2 | R&D expenditures* (a) | 21.2 | 18.7 | ||||||
Capitalization of R&D | 3.3 | 3.4 | |||||||
18.7 | expenditures (b) | ||||||||
17.4 | |||||||||
R&D expenses in P/L | 17.9 | 15.3 | |||||||
15.4 | 15.4 | (a-b) | |||||||
14.6 | |||||||||
(Billions of yen) | FY2020 | FY2021 | |||||||
Amortization | 1.7 | 2.0 | |||||||
End of Mar, 2020 | End of Jun, 2020 | ||||||||
R&D assets | 47.7 | 49.2 |
*Capitalization of R&D expenditures (b) are included in R&D expenditures and capital expenditures.
R&D expenditures* | Capital expenditures* | Depreciation |
Amortization |
Page 20 1Q FY2021 Consolidated Financial Results
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Olympus Corporation published this content on 05 August 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 05 August 2020 06:06:12 UTC