Shibaura Electronics : Consolidated Financial Results for Q2/FY2021（565KB）

Consolidated Financial Results

for the Six Months Ended September 30, 2021

[Japanese GAAP]

November 8, 2021

Company name: Shibaura Electronics Co., Ltd.

Stock exchange listing: Tokyo Stock Exchange

Code number: 6957

URL: https://www.shibaura-e.co.jp

Representative: Akira Kasai, President & Chief Executive Officer

Contact: Yukihide Hoshinoya, Director, Administrative Operations

Phone: [phone]

Scheduled date for filing quarterly securities report: November 9, 2021

Scheduled date for commencing dividend payments: －

Availability of supplementary briefing material on quarterly financial results: Yes

Schedule of quarterly financial results briefing session: Yes (for institutional investors and analysts)

(Amounts of less than one million yen are rounded down.)

1. Consolidated Financial Results for the Six Months Ended September 30, 2021 (April 1, 2021 to September 30, 2021)

(1) Consolidated operating results		(% indicates changes from the previous corresponding period.)
							Net income
	Net sales		Operating income	Ordinary income	attributable to owners
							of parent
Six months ended	Million yen	%	Million yen	%	Million yen	%	Million yen	%
September 30, 2021	15,418	37.2	2,806	235.0	2,816	241.9	1,684	200.8
September 30, 2020	11,240	(15.3)	837	(24.2)	823	(29.2)	559	(32.0)

(Note) Comprehensive income: Six months ended September 30, 2021: ¥1,945 million [677.5%]

Six months ended September 30, 2020: ¥250 million [(70.0)%]

Basic earnings

Diluted earnings

per share

per share

Six months ended

Yen

Yen

September 30, 2021

218.44

－

September 30, 2020

72.61

－

(2) Consolidated financial position

Total assets

Net assets

Equity ratio

Million yen

Million yen

%

As of September 30, 2021

38,784

26,627

68.6

As of March 31, 2021

37,265

25,467

68.2

(Reference) Equity: As of September 30, 2021: ¥26,590 million

As of March 31, 2021:

¥25,432 million

2. Dividends

Annual dividends

1st

2nd

3rd

Year-end

Total

quarter-end

quarter-end

quarter-end

Yen

Yen

Yen

Yen

Yen

Fiscal year ended March 31, 2021

－

0.00

－

75.00

75.00

Fiscal year ending March 31, 2022

－

0.00

Fiscal year ending March 31, 2022

－

130.00

130.00

(Forecast)

(Note) Revision to the dividend forecast announced most recently: Yes

3. Consolidated Financial Results Forecast for the Fiscal Year Ending March 31, 2022 (April 1, 2021 to March 31, 2022)

(% indicates changes from the previous corresponding period.)

							Net income	Basic earnings
	Net sales		Operating income	Ordinary income	attributable to
		per share
							owners of parent
	Million yen	%	Million yen	%	Million yen	%	Million yen	%	Yen
Full year	30,000	19.2	5,000	59.4	5,000	58.1	3,300	47.7	427.96

(Note) Revision to the financial results forecast announced most recently: Yes

Notes:

1. Changes in significant subsidiaries during the period under review: No
   (Changes in specified subsidiaries resulting in changes in scope of consolidation)

Newly included: -

Excluded: -

1. Accounting policies adopted specially for the preparation of quarterly consolidated financial statements: No
2. Changes in accounting policies, changes in accounting estimates and restatement
3. 1. Changes in accounting policies due to the revision of accounting standards: Yes
   2. Changes in accounting policies other than 1) above: No
   3. Changes in accounting estimates: No
   4. Restatement: No

Note: For details, please refer to "2. Quarterly Consolidated Financial Statements and Primary Notes (4) Notes to Quarterly Consolidated Financial Statements (Changes in Accounting Policies)" on page 10 of the appendix to this report.

(4) Total number of issued shares (common shares)

1. Total number of issued shares at the end of the period (including treasury shares): September 30, 2021: 7,779,865 shares

March 31, 2021:

7,779,865 shares

2) Total number of treasury shares at the end of the period:

September 30, 2021:	91,381 shares
March 31, 2021:	62,894 shares

3) Average number of shares during the period:

Six months ended September 30, 2021: 7,711,010 shares

Six months ended September 30, 2020: 7,711,559 shares

Note: The Company has introduced the Board Incentive Plan (BIP Trust). Shares of the Company held in the Trust are included in treasury shares to be deducted for the calculation of the "total number of treasury shares at the end of the period" and the "average number of shares during the period."

• These quarterly financial results are outside the scope of quarterly review by certified public accountants or an audit firm.
• Explanation of the proper use of the financial results forecast and other notes

･The earnings forecasts and other forward-looking statements herein are based on certain information available to the Company as of the date of publication of this document and on certain assumptions deemed reasonable. As such, it is not a commitment made by the Company to achieve them and actual results may differ significantly from these forecasts due to a wide range of factors. For the assumptions used as the basis for the financial results forecast and notes on the use of the forecast, please refer to "1. Qualitative Information on Quarterly Financial Results for the Period under Review (3) Explanation of Consolidated Financial Results Forecast and Other Forward-Looking Statements" on page 3 of the appendix to this report.

･The Company will hold a financial results briefing session for institutional investors and analysts on November 25, 2021. The briefing materials on financial results to be used at the session will be posted on the Company's website promptly after the event.

Shibaura Electronics Co., Ltd. (6957)

Consolidated Financial Results for the Six Months Ended September 30, 2021

Appendix
Table of Contents
1. Qualitative Information on Quarterly Financial Results for the Period under Review ......................	2
(1)	Explanation of Operating Results ............................................................................................	2
(2)	Explanation of Financial Position ............................................................................................	2

1. Explanation of Consolidated Financial Results Forecast and Other Forward-Looking

	Statements ................................................................................................................................	3
2. Quarterly Consolidated Financial Statements and Primary Notes .....................................................	4
(1)	Quarterly Consolidated Balance Sheets ...................................................................................	4
(2)	Quarterly Consolidated Statements of Income and Comprehensive Income ...........................	6
(3)	Quarterly Consolidated Statements of Cash Flows..................................................................	8
(4)	Notes to Quarterly Consolidated Financial Statements..........................................................	10
	(Notes regarding Going Concern Assumptions)......................................................................	10
	(Notes in the Case of Significant Changes in Shareholders' Equity) ......................................	10
	(Changes in Accounting Policies).............................................................................................	10

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Shibaura Electronics Co., Ltd. (6957)

Consolidated Financial Results for the Six Months Ended September 30, 2021

1. Qualitative Information on Quarterly Financial Results for the Period under Review

1. Explanation of Operating Results
   Looking at the global economy surrounding the Group, which consists of Shibaura Electronics Co., Ltd. (the "Company") and its subsidiaries (collectively, the "Group"), during the six months ended September 30, 2021, economic recovery was seen mainly in the U.S. and China in the first quarter, but the recovery slowed down in the second quarter because production activities were restrained primarily due to a resurgence of the novel coronavirus disease (COVID-19) cases caused by variant virus strains and a semiconductor shortage.
   Regarding the Japanese economy, corporate performance has improved mainly in the manufacturing industry on the back of increased exports buoyed by the recovery of the overseas economy. On the other hand, there are concerns about the shortage of semiconductors and materials and a resurgence of COVID-19 cases, and it is still very difficult to predict the future of the economy despite the tendency toward recovery.
   Under these circumstances, the Group has continuously striven to achieve the Medium-Term Business Plan (Sense the Dynamics) while taking measures to prevent COVID-19. From a production perspective, the Group has undertaken efforts to improve quality and productivity primarily through research and development of manufacturing equipment using IT technology as well as continuous improvement activities, and has also been preparing a system that allows a stable material supply, for example, through selection of interchangeable components for the materials that are expected to be difficult to procure. From a sales perspective, the Group has been actively promoting the sales expansion of automobile sensors. Furthermore, a new personnel system has been introduced in the current fiscal year to deal with diversifying work styles and human resource development.
   The consolidated net sales by business field were ¥7,587 million (an increase of 30.6% year on year) for home appliances, ¥4,823 million (an increase of 49.2% year on year) for automobiles, ¥1,849 million (an increase of 32.4% year on year) for industrial equipment, and ¥1,158 million (an increase of 44.7% year on year) for others.
   The loss of ¥276 million due to the bank transfer fraud that occurred at Shibaura Electronics Hong Kong Co., Ltd. was accounted for as extraordinary loss.
   As a result, consolidated net sales for the six months ended September 30, 2021 increased by 37.2% year on year to ¥15,418 million. In terms of profit, consolidated operating income increased by 235.0% to ¥2,806 million, consolidated ordinary income increased by 241.9% to ¥2,816 million and net income attributable to owners of parent increased by 200.8% to ¥1,684 million.
2. Explanation of Financial Position
3. 1. Status of assets, liabilities and net assets

Total assets at the end of the second quarter of the fiscal year under review increased by ¥1,519 million, or 4.1%, from the end of the previous fiscal year to ¥38,784 million. Current assets increased by ¥1,627 million, or 6.1%, to ¥28,284 million, and noncurrent assets decreased by ¥107 million, or 1.0%, to ¥10,500 million.

The main causes of the growth in current assets were an increase of ¥618 million in notes and accounts receivable-trade and electronically recorded monetary claims-operating due to the increase in net sales and an increase of ¥496 million in merchandise and finished goods.

The main cause of the decline in noncurrent assets was the progress of depreciation.

Total liabilities at the end of the second quarter of the fiscal year under review increased by ¥359 million, or 3.0%, from the end of the previous fiscal year to ¥12,157 million. Current liabilities increased by ¥1,011 million, or 12.3%, to ¥9,201 million, and noncurrent liabilities decreased by ¥652 million, or 18.1%, to ¥2,955 million.

The main causes of the increase in current liabilities were an increase of ¥600 million in notes and accounts payable-trade and an increase of ¥295 million in income taxes payable.

The main cause of the decline in noncurrent liabilities was the repayments of long-term loans payable.

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Shibaura Electronics Co., Ltd. (6957)

Consolidated Financial Results for the Six Months Ended September 30, 2021

Net assets at the end of the second quarter of the fiscal year under review increased by ¥1,160 million, or 4.6%, from the end of the previous fiscal year to ¥26,627 million.

The main cause of the increase in net assets was an increase in income in the current period. As a result, the Group's equity ratio increased 0.4 percentage points from 68.2% at the end of the previous fiscal year to 68.6%.

(ii) Status of cash flows

The Group's consolidated cash and cash equivalents ("cash") as of September 30, 2021 amounted to ¥11,704 million, up 20.1% year on year. The status of cash flows from operating, investing and financing activities and major contributing factors were as follows.

Cash flows from operating activities

Net cash provided by operating activities during the six months ended September 30, 2021 increased 43.5% year on year to ¥1,838 million. This was mainly because the cash increase primarily due to income before income taxes of ¥2,542 million and depreciation of ¥749 million exceeded the cash decrease caused chiefly by an increase of ¥928 million in inventories and ¥641 million in income taxes paid.

Cash flows from investing activities

Net cash used in investing activities during the six months ended September 30, 2021 increased 5.1% year on year to ¥326 million. This was primarily due to ¥233 million in the purchase of property, plant and equipment mainly for the introduction of machineries to expand production capacity of thermistor elements at Fukushima Shibaura Electronics Co., Ltd.

Cash flows from financing activities

Net cash used in financing activities during the six months ended September 30, 2021 was ¥1,453 million, compared with ¥2,014 million provided in the same period of the previous fiscal year. This was primarily due to the repayments of long-term loans payable of ¥667 million and the cash dividends paid amounting to ¥582 million.

1. Explanation of Consolidated Financial Results Forecast and Other Forward-Looking Statements The consolidated financial results forecast for the full year of the fiscal year ending March 31, 2022 was reviewed with due consideration given to factors such as business performance during the six months ended September 30, 2021 and future business environment. As a result, the Company revised the financial results forecast and dividend forecast for the full year of the fiscal year ending March 31, 2022 which were announced on May 10, 2021.
   For details, please refer to "Notice Regarding Financial Results Forecast and Dividend Forecast" announced today on November 8, 2021.

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