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    5486   JP3786200000

HITACHI METALS, LTD.

(5486)
  Report
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Hitachi Metals : Consolidated Financial Report For the 3-month period ended June 30, 2020

07/28/2020 | 04:05am EDT

Consolidated Financial Report [IFRS]

For the 3-month period ended June 30, 2020

July 28, 2020

Listed Company: Hitachi Metals, Ltd. (URL https://www.hitachi-metals.co.jp/e/index.html)

Listed Stock Exchanges: Tokyo Stock Exchange, Inc. (First Section, Code Number 5486)

Representative: Mitsuaki Nishiyama, Chairperson, President, and CEO

Contact: Tatsuya Minami, General Manager, Corporate Communications Dept. Tel: +81-3-6774-3077

Note: Figures are rounded off to the nearest million yen.

1. Performance for the First Quarter Ended June 30, 2020 (April 1, 2020 to June 30, 2020)

(1) Operating Results

(% indicates the rate of +/- compared with the same term of the previous fiscal year)

Revenues

Adjusted

Operating Income

Income before

Net Income

Operating Income

Income Taxes

Million yen

%

Million yen

%

Million yen

%

Million yen

%

Million yen

%

June, 2020

154,773

(33.8)

(7,275)

(6,412)

(7,072)

(3,396)

June, 2019

233,953

(9.9)

5,512

(65.5)

5,189

(74.8)

4,517

(78.9)

3,214

(81.1)

Note: In order to give a true view of the condition of the whole Group's business without the effects of business restructuring etc., the Hitachi Metals Group (the "Group") shows "adjusted operating income" which is the operating income (loss) recorded in the consolidated statement of income, excluding non- operating income and expenses, and extraordinary income and losses. Adjusted operating income is a unified profit indicator for the Hitachi Group, including Hitachi, Ltd.

Net Income attributable to

Comprehensive

Earnings per Share

Earnings per Share

Shareholders

Income

(Basic)

(Diluted)

of the Parent Company

Million yen

%

Million yen

%

Yen

Yen

June, 2020

(3,340)

(3,813)

(7.81)

June, 2019

3,242

(81.0)

(4,895)

7.58

(2) Financial Standing

Total Asset

Total Equity

Equity attributable to

Equity attributable to

Equity per Share attributable

Shareholders of the

Shareholders of the Parent to Shareholders of the Parent

Parent Company

Company Ratio

Company

Million yen

Million yen

Million yen

%

Yen

June, 2020

964,850

513,481

510,992

53.0

1,195.12

March, 2020

977,766

522,853

520,313

53.2

1,216.92

2. Dividends

Dividends per Share

1Q

2Q

3Q

Term-end

Annual

Yen

Yen

Yen

Yen

Yen

March, 2020

13.00

13.00

26.00

March, 2021

March, 2021

(Forecast)

Note: Revision of

the latest forecasts of results

: No

*The dividends on March, 2021 (forecast) have been undetermined as of this point.

3. Business results forecast for the year ending March 31, 2021 (April 1, 2020 to March 31, 2021)

(% indicates the rate of +/- compared with the previous fiscal year)

Adjusted

Income before

Net Income

Earnings per

Revenues

attributable to Shareholders

Share

Operating Income

Income Taxes

of the Parent Company

(Basic)

Million yen

%

Million yen

%

Million yen

%

Million yen

%

Yen

Full-year

750,000

(14.9)

(5,000)

(15,000)

(12,000)

(28.07)

Note: 1. Revision of the latest forecasts of results : No

2. In order to give a true view of the condition of the Group's business without the effects of business restructuring etc., the Group shows "adjusted operating income" which is the operating income (loss) recorded in the consolidated statement of income, excluding non-operating income and expenses, and extraordinary income and losses. Adjusted operating income is a unified profit indicator for the Hitachi Group, including Hitachi, Ltd.

  • 1 -

Other Notes

Numbers of shares issued (Common stock)

() Number of shares outstanding at end of period

(Including treasury stock)

June, 2020

428,904,352

March, 2020

428,904,352

() Number of treasury stock outstanding at end of period

June, 2020

1,337,944

March, 2020

1,337,583

() Average number of shares issued during the term

June, 2020 (1Q)

427,566,545

June, 2019 (1Q)

427,569,581

*This quarterly consolidated financial report is not subject to the quarterly review procedure by the scope of audit.

*The forecast figures, with the exception of actual results, are based on certain assumptions and predictions of the management at the time of preparation. Changes in business conditions or underlying assumptions may cause actual results may differ from those projected. Please refer to "(3) Forecasts for the Fiscal Year Ending March 31, 2021, including Consolidated Operating Forecasts" on page 7 for precondition and assumption as the basis of the above forecasts.

- 2 -

○ Table of Contents

1. Qualitative Information Regarding Financial Results for the Three Months Ended June 30, 2020……………………………… 4

  1. Information Regarding Operating Results………………………………..……………………………………………… 4
  2. Analisys of Financial Condition…………………………………………………………………….…………………… 6

(3) Forecasts for the Fiscal Year Ending March 31, 2021, including Consolidated Operating Forecasts…………………

7

2. Condensed Interim Consolidated Financial Statements and Notes to Condensed Interim Consolidated Financial Statements…

8

  1. Condensed Interim Consolidated Statement of Financial Position……………………………………………………… 8
  2. Condensed Interim Consolidated Statement of Income and Condensed Interim Consolidated Statement of Comprehensive Income………………………………………………………………………………………….……… 10 [ Condensed Interim Consolidated Statement of Income ]……………………………………………………………… 10 [ Condensed Interim Consolidated Statement of Comprehensive Income ]……………………………………………. 11
  3. Condensed Interim Consolidated Statement of Changes in Equity……………………………………………………… 12
  4. Condensed Interim Consolidated Statement of Cash Flows…………………………………………………………….. 13
  5. Segment Information…………………………………………………………………………………………………….. 15

- 3 -

1. Qualitative Information Regarding Financial Results for the Three Months Ended June 30, 2020

  1. Information Regarding Operating Results

The Group's operating results for the three months ended June 30, 2020 were as followings.

During the three months ended June 30, 2020, economic and social activities in various regions of the world were severely restricted due to the global outbreak of the novel coronavirus disease (COVID-19, hereinafter "COVID-19"), leading to a recession. In the business fields of the Group, demand for our mainstay products, mainly automotive products, declined significantly. As a result, revenues decreased by 33.8% year on year to ¥154,773 million. The decrease in revenues due to the impact of the COVID-19 outbreak amounted to approximately ¥48 billion.

Adjusted operating income* for the three months ended June 30, 2020 decreased by ¥12,787 million year on year, resulting in an adjusted operating loss of ¥7,275 million. This was attributable to a decrease in revenues despite earnings improvement measures including a reduction in fixed costs in accordance with the plan set out at the beginning of the fiscal year looking ahead of the possible influence of the COVID-19 outbreak. The decrease in adjusted operating income due to the impact of the COVID-19 outbreak amounted to approximately ¥13 billion.

In addition, ¥1,971 million was recorded as a gain on business reorganization and others under other operating revenue in line with the transfer of all of the shares of Mitsubishi Hitachi Tool, Ltd. (currently, MOLDINO Tool Engineering, Ltd.) held by the Company to Mitsubishi Materials Corporation on April 1, 2020. However, reflecting the significant impact of the drop in revenues, operating income decreased by ¥11,601 million year on year, resulting in an operating loss of ¥6,412 million. Income before income taxes decreased by ¥11,589 million year on year, resulting in a loss before income taxes of ¥7,072 million, and net income attributable to shareholders of the parent company decreased by ¥6,582 million, resulting in a net loss attributable to shareholders of the parent company of ¥3,340 million.

The Group introduced business management based on Return on Invested Capital (ROIC) with the aim of improving cash flow and capital efficiency, as of the important challenges in the fiscal year 2021 Medium-term Management Plan. In particular, in the current consolidated fiscal year, under circumstances in which the future of the business environment is uncertain due to the COVID-19 outbreak, we believe that it is even more important to secure sufficient liquidity to ensure financial soundness and to steadily promote initiatives that can be effective through our own efforts, regardless of external factors such as demand. For this purpose, the Group has been working to curb capital expenditure through carefully selected investment in core business areas while enhancing operating capital efficiency.

The results by business segment are as followings. Note that revenues for each segment include intersegment revenues. There were no significant changes to the businesses of the Group during the three months ended June 30, 2020.

Specialty Steel Products

Revenues in the Specialty Steel Products segment for the three months ended June 30, 2020 were ¥52,476 million, a decrease of 17.7% as compared with those for the three months ended June 30, 2019.

Breaking down the revenues by business, sales of molds and tool steel, among the business of tool steel & roll, decreased year on year, due to a decrease in both domestic and international demand and ongoing inventory adjustments including distribution stock corrections mainly in Japan since the previous fiscal year. Overall sales of rolls dropped compared with the same period of the previous fiscal year reflecting a year-on-year decline in sales of injection molding machine parts and steel-frame joints for construction due to diminished demand despite sales of rolls remaining virtually unchanged year on year.

Among the business of industrial, aircraft & energy materials, sales of industrial materials decreased year on year, both for products related to automobiles and razor blade materials on the back of a decline in demand. Sales of aircraft & energy materials decreased year on year due to a decline in demand for our mainstay aircraft-related materials, mainly in the private sector.

Among alloys for electronic products, sales of organic EL panel-related components grew and sales of clad metals for smartphones and batteries also increased. However, overall sales of alloys for electronic products remained virtually flat year on year due to a decline in sales of products related to automobiles despite a rise in sales related to server applications among semiconductor package components.

Adjusted operating income decreased by ¥696 million to ¥157 million of loss compared with the year ended March 31, 2019, primarily due to a decline in demand for the Company's mainstays including molds and tool steel and industrial materials. In addition, ¥1,971 million was recorded as a gain on business reorganization and others under other operating revenue in line with the transfer of all of the shares of Mitsubishi Hitachi Tool, Ltd. (currently, MOLDINO Tool Engineering, Ltd.) held by the Company to Mitsubishi Materials Corporation on April 1, 2020. As a result, operating income of the segment increased by ¥864 million year on year to ¥1,516 million.

- 4 -

Functional Components and Equipment

Revenues in the Functional Components and Equipment segment for the three months ended June 30, 2020 were ¥40,170 million, a decrease of 51.8% year on year.

Breaking down the revenues by business, among casting components for automobiles, demand for cast iron products plummeted due to the suspension of operations by the Company's major customers in various parts of the world as a result of the COVID- 19 outbreak. For this reason, sales of casting components for automobiles decreased year on year both in North America and Asia. Sales of heat-resistant exhaust casting components also saw a year-on-year decrease owning to diminished demand. It has been determined to withdraw from the aluminum wheels business. Therefore, the termination of production is progressing as planned towards the end of September 2020. As a result, overall sales of casting components for automobiles decreased year on year.

Among piping components, sales of semiconductor manufacturing equipment increased year on year due to the recovery of capital investment demand. Sales of pipe fittings, the Company's mainstay products, decreased year on year reflecting a decline in the number of housing starts in both domestic and international markets. As a result, overall sales of piping components decreased year on year.

Adjusted operating income decreased by ¥8,995 million year on year, resulting in an adjusted operating loss of ¥7,000 million, due to a decrease in revenues from the automotive casting components business, which is the segment's core business. Operating loss was ¥7,308 million, a decrease of ¥9,023 million from the same period last year.

Magnetic Materials and Applications / Power Electronics

Revenues in the Magnetic Materials and Applications / Power Electronics segment for the three months ended June 30, 2020 were ¥22,067 million, a decrease of 27.9% year on year.

Breaking down the revenues by business, sales of rare earth magnets among magnetic materials and applications decreased year on year. This was due to a decline in demand for various manufacturing equipment and industrial machinery as well as electronics-related products in the industrial equipment-related business in addition to a downturn in demand for automotive electronic components. Sales of ferrite magnets decreased year on year due to a decrease in automotive electronic components. As a result, overall sales of magnetic materials and applications decreased year on year.

Among power electronics materials, sales of soft magnetic materials and their applied products decreased year on year due to a decline in demand for amorphous metals for transformers, despite an increase in demand related to telecommunications such as server equipment. Meanwhile, sales of ceramic components remained virtually unchanged year on year due to a decrease in demand for use in telecommunications equipment and automotive electronic components, despite an increase in demand for use in medical equipment. As a result, sales of power electronics materials as a whole decreased from the same period last year. Adjusted operating loss was ¥478 million, a decrease of ¥265 million year on year, due to a decrease in demand for magnetic materials and applications. Operating loss was ¥503 million, a decrease of ¥260 million compared with the three months ended June 30, 2019.

Wires, Cables, and Related Products

Revenues in the Wires, Cables, and Related Products segment for the three months ended June 30, 2020, were ¥39,874 million, a decrease of 28.8% year on year.

Breaking down the revenues by business, sales of wires and cables for medical use increased year on year reflecting an increase in demand for cables. Sales of electronic wires increased year on year due to an increase in demand related to base stations for the fifth generation technology standard for cellular networks (5G) in addition to an increase in demand for FA / robots. Meanwhile, sales of wires and cables for rolling stock decreased year on year as a result of diminished demand both in domestic and international markets. Sales of magnet wires decreased year on year due to a decrease in demand mainly for automotive applications. As a result, overall sales of wires, cables, and related products decreased year on year.

Demand for automotive components decreased significantly due to the suspension of operations by the Company's major customers in various parts of the world as a result of the COVID-19 outbreak. For this reason, sales of automotive components, including both automotive electronic components and brake hoses, decreased year on year.

Adjusted operating loss was ¥510 million, a decrease of ¥2,357 million, as compared with the three months ended June 30, 2019, led in part by a decline in demand for the wires, cables, and automotive components. Operating loss of the segment was ¥327 million, a decrease of ¥2,190 million year on year for the same period.

- 5 -

Other

Revenues in the Other segment for the three months ended June 30, 2020, were ¥698 million, a decrease of 20.3%, and adjusted operating income increased by ¥84 million to ¥251 million, as compared with those for the three months ended June 30, 2019. Operating income of the segment increased by ¥198 million to ¥252 million year on year for the same period.

*In order to give a true view of the condition of the Group's business without the effects of business restructuring etc., the Group shows "adjusted operating income"which is the operating income (loss) recorded in the consolidated statement of income, excluding non-operating income and expenses, and extraordinary income and losses. Adjusted operating income is a unified profit indicator for the Hitachi Group, including Hitachi, Ltd.

  1. Analysis of Financial Condition
    1. Assets, liabilities, and equity
      The analysis of changes in the Group's condensed interim consolidated statement of financial position as of the end of the period ended June 30, 2020, is as follows:
      Total assets were ¥964,850 million, a decrease of ¥12,916 million compared with the end of the fiscal year ended March 31, 2020. Current assets were ¥412,801 million, an increase of ¥6,682 million compared with the end of the fiscal year ended March 31, 2020. This was mainly due to a decrease of ¥16,618 million in trade receivables despite an increase of ¥26,986 million in cash and cash equivalents. Non-current assets were ¥552,049 million, a decrease of ¥19,598 million compared with the end of the fiscal year ended March 31, 2020. Investments accounted for using the equity method decreased by ¥17,731 million. This was attributable primarily to the effect of the exclusion from the scope of application of the equity method as a result of the transfer of the 49% of the total number of outstanding shares of Mitsubishi Hitachi Tool, Ltd. (currently, MOLDINO Tool Engineering, Ltd.) held by the Company on April 1, 2020.
      Total liabilities were ¥451,369 million, a decrease of ¥3,544 million compared with the end of the fiscal year ended March 31, 2020. This was mainly attributable to an increase of ¥33,850 million in short-term debt, despite decreases of ¥19,610 million and ¥6,298 million in trade payables and the current portion of long-term debt and long-term debt, respectively. Total equity was ¥513,481 million, a decrease of ¥9,372 million compared with the end of the fiscal year ended March 31, 2020. This was mainly attributable to decreases in retained earnings of ¥9,074 million.
    2. Cash flows
      Cash and cash equivalents as of the end of the three months ended June 30, 2020, were ¥69,339 million, an increase of
      ¥26,986 million compared with the end of the fiscal year ended March 31, 2020, as a result of cash provided by investing activities and financing activities exceeding net cash used in operating activities. The analysis of cash flows for each category as of June 30, 2020, is as follows:

      Net cash used in operating activities was ¥10,276 million. This was mainly attributable to the net effect of net loss of ¥3,396 million and payment of ¥6,763 million for the increase of working capital among others.

      Net cash provided by investing activities was ¥15,178 million. This was primarily attributable to payment of ¥10,210 million for the purchase of property, plant and equipment and proceeds of ¥25,438 million from sale of investments in securities and other financial assets (including investments in subsidiaries and investments accounted for using the equity method) due mainly to the transfer of the 49% of the total number of outstanding shares of Mitsubishi Hitachi Tool, Ltd. (currently, MOLDINO Tool Engineering, Ltd.) held by the Company on April 1, 2020.

      Net cash provided by financing activities was ¥22,273 million. This was mainly attributable to net increase in short-term debt of ¥34,210 million, despite the net effect of repayment of long-term debts of ¥6,486 million and dividends paid to shareholders of ¥5,558 million.
      • 6 -

(3) Forecasts for the Fiscal Year Ending March 31, 2021, including Consolidated Operating Forecasts

The business environment surrounding the Company remains unpredictable as the impact of the COVID-19 outbreak continues. However, since the Company's operating results for the three months ended June 30, 2020 were generally within the scope of expectations, the figures in the operating forecast for the fiscal year ending March 31, 2021 (April 1, 2020 through March 31, 2021) have not been revised from the forecast figures released on May 27, 2020.

- 7 -

2. Condensed Interim Consolidated Financial Statements

and Notes to Condensed Interim Consolidated Financial Statements

  1. Condensed Interim Consolidated Statement of Financial Position

(Millions of yen)

As of

As of

March 31, 2020

June 30, 2020

Assets

Current assets

Cash and cash equivalents

42,353

69,339

Trade receivables

157,732

141,114

Inventories

179,925

183,452

Other current assets

26,109

18,896

Total current assets

406,119

412,801

Non-current assets

Investments accounted for using the equity method

28,354

10,623

Investments in securities and other financial assets

13,234

13,534

Property, plant and equipment

381,095

375,164

Goodwill and intangible assets

118,174

116,376

Deferred tax assets

17,816

23,465

Other non-current assets

12,974

12,887

Total non-current assets

571,647

552,049

Total assets

977,766

964,850

- 8 -

(Millions of yen)

As of

As of

March 31, 2020

June 30, 2020

Liabilities

Current liabilities

Short-term debt

53,048

86,898

Current portion of long-term debt

51,253

50,905

Other financial liabilities

26,642

19,673

Trade payables

126,640

107,030

Accrued expenses

35,042

30,557

Contract liabilities

640

607

Other current liabilities

3,934

3,156

Total current liabilities

297,199

298,826

Non-current liabilities

Long-term debt

83,285

77,335

Other financial liabilities

978

907

Retirement and severance benefits

67,560

67,904

Deferred tax liabilities

2,420

2,448

Other non-current liabilities

3,471

3,949

Total non-current liabilities

157,714

152,543

Total liabilities

454,913

451,369

Equity

Equity attributable to shareholders of the parent company

Common stock

26,284

26,284

Capital surplus

115,405

115,405

Retained earnings

374,820

365,746

Accumulated other comprehensive income

4,969

4,723

Treasury stock, at cost

(1,165)

(1,166)

Total equity attributable to shareholders of the parent

520,313

510,992

company

Non-controlling interests

2,540

2,489

Total equity

522,853

513,481

Total liabilities and equity

977,766

964,850

- 9 -

(2) Condensed Interim Consolidated Statement of Income

and Condensed Interim Consolidated Statement of Comprehensive Income

[ Condensed Interim Consolidated Statement of Income ] [ For the three months ended June 30, 2020 ]

(Millions of yen)

Note

For the first quarter ended

For the first quarter ended

June 30, 2019

June 30, 2020

Revenues

233,953

154,773

Cost of sales

(200,079)

(138,129)

Gross profit

33,874

16,644

Selling, general and administrative expenses

(28,362)

(23,919)

Other income

934

3,067

Other expenses

(1,257)

(2,204)

Operating income (loss)

1

5,189

(6,412)

Interest income

119

52

Other financial income

57

165

Interest charges

(724)

(425)

Other financial expenses

(612)

(116)

Share of (losses) profits of investments accounted

488

(336)

for using the equity method

Income (loss) before income taxes

4,517

(7,072)

Income taxes

(1,303)

3,676

Net income (loss)

3,214

(3,396)

Net income (loss) attributable to:

Shareholders of the parent company

3,242

(3,340)

Non-controlling interests

(28)

(56)

Net income (loss)

3,214

(3,396)

Earnings per share

Basic

¥7.58

¥(7.81)

Diluted

Note: 1. Adjusted operating income, which is the operating income (loss) presented in the condensed interim consolidated statement of income, excluding other income and other expenses, is ¥5,512 million and ¥(7,275) million for the three months ended June 30, 2019 and 2020, respectively.

- 10 -

[ Condensed Interim Consolidated Statement of Comprehensive Income ] [ For the three months ended June 30, 2020 ]

(Millions of yen)

For the first quarter ended

For the first quarter ended

June 30, 2019

June 30, 2020

Net income (loss)

3,214

(3,396)

Other comprehensive income

Items not to be reclassified into net income

Net change in fair value of financial assets measured at fair

(28)

190

value through other comprehensive income

Share of other comprehensive income of investments

13

49

accounted for using the equity method

Total items not to be reclassified into net income

(15)

239

Items that can be reclassified into net income

Foreign currency translation adjustments

(7,922)

(588)

Net change in fair value of cash flow hedges

(180)

5

Share of other comprehensive income of investments

8

(73)

accounted for using the equity method

Total items that can be reclassified into net income

(8,094)

(656)

Total other comprehensive income

(8,109)

(417)

Comprehensive income

(4,895)

(3,813)

Comprehensive income attributable to:

Shareholders of the parent company

(4,634)

(3,762)

Non-controlling interests

(261)

(51)

Comprehensive income

(4,895)

(3,813)

- 11 -

(3) Condensed Interim Consolidated Statement of Changes in Equity

(Millions of yen)

Accumulated

Total equity

Treasury

attributable to

Common

Capital

Retained

other

Non-controlling

stock,

shareholders

Total equity

stock

surplus

earnings

comprehensive

at cost

of the parent

interests

income

company

Balance at April 1, 2019

26,284

115,045

425,886

21,925

(1,161)

587,979

7,232

595,211

Cumulative effect of

(607)

(607)

(607)

accounting change

Restated balance

26,284

115,045

425,279

21,925

(1,161)

587,372

7,232

594,604

Changes in equity

Net income

3,242

3,242

(28)

3,214

Other comprehensive income

(7,876)

(7,876)

(233)

(8,109)

Dividends to shareholders of

(7,269)

(7,269)

(7,269)

the parent company

Dividends to non-controlling

(5)

(5)

interests

Acquisition of treasury stock

(1)

(1)

(1)

Sales of treasury stock

0

0

0

0

Transfer to retained earnings

Total changes in equity

0

(4,027)

(7,876)

(1)

(11,904)

(266)

(12,170)

Balance at June 30, 2019

26,284

115,045

421,252

14,049

(1,162)

575,468

6,966

582,434

Accumulated

Common

Capital

Retained

other

stock

surplus

earnings

comprehensive

income

Total equity

Treasury

attributable to

stock,

shareholders

at cost

of the parent

company

Non-controllingTotal equity interests

Balance at April 1, 2020

26,284

115,405

374,820

4,969

(1,165)

520,313

2,540

522,853

Changes in equity

Net income (loss)

(3,340)

(3,340)

(56)

(3,396)

Other comprehensive income

(422)

(422)

5

(417)

Dividends to shareholders of

(5,558)

(5,558)

(5,558)

the parent company

Dividends to non-controlling

interests

Acquisition of treasury stock

(1)

(1)

(1)

Sales of treasury stock

Transfer to retained earnings

(176)

176

Total changes in equity

(9,074)

(246)

(1)

(9,321)

(51)

(9,372)

Balance at June 30, 2020

26,284

115,405

365,746

4,723

(1,166)

510,992

2,489

513,481

- 12 -

(4) Condensed Interim Consolidated Statement of Cash Flows

(Millions of yen)

For the first quarter ended

For the first quarter ended

June 30, 2019

June 30, 2020

Cash flows from operating activities:

Net income (loss)

3,214

(3,396)

Adjustments to reconcile net income to

net cash provided by operating activities:

Depreciation and amortization

13,944

13,317

Impairment losses

160

Share of losses (profits) of investments accounted

(488)

336

for using the equity method

Financial income and expenses

1,160

324

Losses (profits) on sale of property, plant and equipment

490

232

Structural reform expenses

79

Net loss (gain) on business reorganization and others

(1,971)

Income taxes

1,303

(3,676)

(Increase) decrease in trade receivables

(4,349)

16,380

(Increase) decrease in inventories

1,676

(3,579)

(Increase) decrease in accounts receivable - other

8,991

4,771

Increase (decrease) in trade payables

(9,270)

(19,564)

Increase (decrease) in accrued expenses

(3,489)

(4,319)

Increase (decrease) in retirement and severance benefits

13

588

Other

(4,771)

(6,084)

Subtotal

8,584

(6,562)

Interest and dividends received

198

360

Interest paid

(886)

(538)

Income taxes paid

(909)

(3,536)

Net cash provided by operating activities

6,987

(10,276)

- 13 -

(Millions of yen)

For the first quarter ended

For the first quarter ended

June 30, 2019

June 30, 2020

Cash flows from investing activities:

Purchase of property, plant and equipment

(19,618)

(10,210)

Purchase of intangible assets

(431)

(269)

Proceeds from sales of property, plant and equipment

169

127

Purchase of investments in securities and other financial

assets

(99)

(26)

(including investments in subsidiaries and investments

accounted for using the equity method)

Proceeds from sale of investments in securities and other

financial assets (including investments in subsidiaries and

98

25,438

investments accounted for using the equity method)

Other

666

118

Net cash used in investing activities

(19,215)

15,178

Cash flows from financing activities:

Increase (decrease) in short-term debt, net

28,066

34,210

Proceeds from long-term debt

284

108

Repayment of long-term debt

(6,487)

(6,486)

Dividends paid to shareholders

(7,269)

(5,558)

Dividends paid to non-controlling interests

(5)

Acquisition of common stock for treasury

(1)

(1)

Proceeds from sales of treasury stock

0

Net cash used in financing activities

14,588

22,273

Effect of exchange rate changes on cash and cash equivalents

(1,969)

(189)

Net increase (decrease) in cash and cash equivalents

391

26,986

Cash and cash equivalents at the beginning of the first quarter

41,098

42,353

Cash and cash equivalents at the end of the first quarter

41,489

69,339

- 14 -

  1. Segment Information
  • The primary products and services included in each segment are as follows:

Reportable segment

Major products and services

< Tool Steel & Roll >

Specialty Steel Products

Functional

Components and

Equipment

Magnetic Materials

and Applications

/ Power Electronics

Wires, Cables, and Related Products

·Molds and tool steel, Rolls for steel mills, Injection molding machine parts, Structural ceramic products, and Steel-frame joints for construction

< Industrial, Aerospace & Energy Materials >

·Automobile-related materials, Razor and blade materials, Precision cast components, and Aircraft- and energy-related materials

·Display-related materials, Semiconductor and other package materials, and Battery-related materials

< Automotive Casting >

·HNMTM ductile cast iron products, Cast iron products for transportation equipment, HERCUNITETM heat-resistant exhaust casting components, and Aluminum components

< Piping Components >

·Piping and infrastructure components (TM Gourd brand pipe fittings, valves, stainless steel and plastic piping components, water cooling equipment, precision mass flow control devices and sealed expansion tanks)

< Magnetic Materials >

·NEOMAX® rare-earth magnets, Ferrite magnets, and Other magnets and applied products

< Power Electronics Materials >

·Soft magnetic materials (Metglas® amorphous metals; FINEMET® nanocrystalline magnetic material; and soft ferrite) and applied products, and Ceramic components

< Electric Wire & Cable >

·Industrial cables, Electronic wires, Electric equipment materials, Cable assemblies, and Industrial rubber products

< Automotive Components >

·Automotive electronic components and Brake hoses

- 15 -

  • Last consolidated first quarter (from April 1, 2019 to June 30, 2019)

(Millions of yen)

Business Segment

Condensed

Magnetic

Wires,

Interim

Functional

Materials

Specialty

Cables,

Others

Total

Adjustments

Consolidated

Components

and

Steel

and

Subtotal

Statement of

and

Applications

Products

Related

Income

Equipment

/Power

Products

Electronics

Revenues

External customers

63,706

83,316

30,589

55,928

233,539

414

233,953

233,953

Intersegment

41

1

102

144

462

606

(606)

transactions

Total revenues

63,747

83,316

30,590

56,030

233,683

876

234,559

(606)

233,953

Segment profit (loss)

652

1,715

(243)

1,863

3,987

54

4,041

1,148

5,189

Financial income

176

Financial expenses

(1,336)

Share of (losses) profits of

investments accounted for

488

using the equity method

Income before

4,517

income taxes

Note: 1. Segment profit (loss) is based on operating income.

  • 2. Intersegment transactions are recorded at the same prices used in transactions with third parties. Adjustments represent mainly allocation variances of general and administrative expenses for corporate assets, which are not allocated to each reportable segment.

  • Current first quarter (from April 1, 2020 to June 30, 2020)

(Millions of yen)

Business Segment

Condensed

Magnetic

Wires,

Interim

Functional

Materials

Specialty

Cables,

Others

Total

Adjustments

Consolidated

Components

and

Steel

and

Subtotal

Statement of

and

Applications

Products

Related

Income

Equipment

/Power

Products

Electronics

Revenues

External customers

52,431

40,170

22,039

39,822

154,462

311

154,773

154,773

Intersegment

45

28

52

125

387

512

(512)

transactions

Total revenues

52,476

40,170

22,067

39,874

154,587

698

155,285

(512)

154,773

Segment profit (loss)

1,516

(7,308)

(503)

(327)

(6,622)

252

(6,370)

(42)

(6,412)

Financial income

217

Financial expenses

(541)

Share of (losses) profits of

investments accounted for

(336)

using the equity method

Income before

(7,072)

income taxes

Note: 1. Segment profit (loss) is based on operating income.

2. Intersegment transactions are recorded at the same prices used in transactions with third parties. Adjustments represent mainly allocation variances of general and administrative expenses for corporate assets, which are not allocated to each reportable segment.

- 16 -

Disclaimer

Hitachi Metals Ltd. published this content on 28 July 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 28 July 2020 08:05:16 UTC


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Average target price 1 894,25 JPY
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Spread / Highest target 2,78%
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Mitsuaki Nishiyama Co-Chairman, CEO & Executive President
Hiroaki Nishioka Chief Financial Officer & Head-Administration
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