Micronics Japan : Transcript of conference on results for FY2022 Q2

Conference on Q2 Result for FY2022

August 10, 2022

Code: 6871

Co., Ltd.	0

This is a transcript of the financial results conference for the second quarter of the fiscal year ending December 2022, held on August 10, 2022.

Disclaimer

The contents of this presentation were compiled based on information readily available at the time of this presentation. Outlooks and other forward-looking statements are subject to change based on many uncertain worldwide factors including but not limited to market conditions, competition as well as semiconductor / LCD industry trends. Accordingly, please take note that the actual performance of the Company may vary considerably from the information and statements made in this presentation.

© 2022 All Rights Reserved - Micronics Japan Co., Ltd.

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Todayʼs Agenda

1. Overview of Q2 Result of Fiscal Year Ending on June 30, 2022

Futoru Saito

Director & Senior Executive Officer, General Manager of Administration Office

2. Business Conditions

Masayoshi Hasegawa

President and Representative Director

3. Q&A Session

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＜Speakers＞

MICRONICS JAPAN CO., LTD., President and Representative Director, Masayoshi Hasegawa

MICRONICS JAPAN CO., LTD., Director & Senior Executive Officer,

General Manager of Administration Office,

Futoru Saito

MICRONICS JAPAN CO., LTD., General Manager, Corporate Planning & Strategy Office, Shigeki, Toda

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Overview of Q2 Result of Fiscal Year Ending on June 30, 2022

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Consolidated Result Summary

(Mils. of Yen)

				FY12/2021	FY12/2022
				Apr-Jun	Jan-Mar	Apr-Jun	QoQ (%)	YoY (%)
				Q2	Q1	Q2
	Net Sales		8,901	9,803	9,766	-0.4%	9.7%
		Probe Card		8,227	8,765	8,869	1.2%	7.8%
		TE ※1		674	1,038	897	-13.6%	33.1%
	Gross Profit		4,185	4,365	4,433	1.6%	5.9%
		SG&A Expenses	2,040	2,202	2,495	13.3%	22.3%
	Operating Income	2,144	2,163	1,938	-10.4%	-9.6%
		Probe Card	※2	2,402	2,636	2,525	-4.2%	5.1%
		TE	※2	225	106	13	-87.7%	-94.2%
		Corporate		(482)	(579)	(599)	━	━
	Ordinary Income	2,392	2,217	2,228	0.5%	-6.8%
	Net Income Attributable	1,771	1,258	1,615	28.3%	-8.8%
	to Owner of Parent

FY12/2021 FY12/2022

Jan.- Jun. Jan.- Jun. YoY (%)

6-month6-month

17,554	19,570	11.5%
16,232	17,634	8.6%
1,322	1,935	46.4%
7,723	8,799	13.9%
3,884	4,697	20.9%
3,839	4,101	6.8%
4,630	5,161	11.5%
179	119	-33.2%
(970)	(1,179)	━
4,045	4,445	9.9%
2,793	2,873	2.9%

※1︓Test Equipment ※2︓Segment profit

・The test socket business has been transferred from the "probe card business" to the "TE business" from the fiscal year ending December 31, 2022, and the results of the previous fiscal year have been reclassified.

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This is a summary of the financial results. As indicated in the note at the bottom of the slide, the breakdown of some segments has changed from this fiscal year. Until last year, the test socket business was included in the probe card business, but it was transferred to the TE business this year.

Therefore, we have incorporated the test socket business into the TE business in the fiscal years ending December 2021 and 2022. Please note that data for 2020 and earlier have not been transferred.

The following is an overview of the financial results for the first half of the fiscal year ending December 2022. I'll mainly talk about the yellow part on the right side of the slide. Sales were 19,570 million yen and increased by about 2,016 million yen more than last year's period. We were very grateful to receive many orders, and the operation of the factory is progressing smoothly, and sales have increased steadily.

Gross profit was 8,799 million yen with a gross margin of 45%. The gross margin for the same period last year was 44%, which is about a percentage point better. This is partly due to the breakdown of the products ordered and the product mix, and partly because the plant was operating in perfect and stable condition.

SG & A expenses were 4,697 million yen, an increase of about 813 million yen compared to last year. As a breakdown, research and development expenses were 220 million yen, and personnel expenses were 245 million yen. And personnel expenses included bonuses of 174 million yen. Bonuses at our company have a performance- distribution aspect. Since it can be said that our company's performance has been good, it has led to an increase in bonuses and personnel expenses.

Other factors included a 120 million yen increase in the provision for product warranties and a 75 million yen increase in taxes, public dues, and enterprise taxes. Although transportation expenses have increased compared to last year, they are only about half of what they were before the pandemic, and we have yet to resume vigorous business activities. Therefore, we use Web meetings and e-mail to communicate closely with customers.

Other income increased by 344 million yen. The biggest part of the breakdown is the exchange gain of 229 million yen. In the first quarter, foreign exchange losses amounted to 10 million yen, increasing to more than 200 million yen in the second quarter alone.

The initial exchange rate was 110 yen to the dollar, but the current exchange rate was 115 yen at the beginning of January 2022. This exceeded 120 yen at the end of March, and now it is going in the direction of the depreciation of the yen, which is about 135 yen against the dollar, so there was a foreign exchange profit in the second quarter. Because the exchange rate is difficult to read, the current assumed exchange rate is 120 yen.

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