November 14, 2022
Consolidated Financial Highlights for the Second Quarter ended September 30, 2022 [under Japanese GAAP]
Company name : | SMC Corporation | ||
Stock exchange listing : | Tokyo Stock Exchange, Prime Market | ||
Security code : | 6273 | ||
URL : | https://www.smcworld.com/ir/en/ | ||
Representative : | Yoshiki Takada, | President | |
Contact person : | Masahiro Ota, | Director and Executive Officer | |
Projected date of filing quarterly report : | November 14, 2022 | ||
Projected starting date of dividend payment : | December 1, 2022 |
1. Consolidated Financial Highlights for the Second Quarter ended September 30, 2022 (April 1, 2022 to September 30, 2022)
(1) Consolidated Operating Results | (Millions of yen) | |||||||||
Second Quarter | Net sales | Operating profit | Ordinary profit | Profit attributable to | ||||||
ended September 30 | owners of parent | |||||||||
2022 | 421,529 | 17.5% | 133,649 | 13.2% | 180,725 | 43.3% | 133,054 | 47.4% | ||
2021 | 358,691 | 42.3% | 118,035 | 81.5% | 126,074 | 84.7% | 90,269 | 95.0% | ||
(Note) Comprehensive income 2Q ended September 30, 2022 : | ¥ | 202,662 million | 104.8% | |||||||
2Q ended September 30, 2021 : | ¥ | 98,966 million | 75.8% | |||||||
(Yen) | ||||||||||
Second Quarter | Net income | Net income per share | ||||||||
ended September 30 | per share | (diluted basis) | ||||||||
2022 | 2,036.32 | − | ||||||||
2021 | 1,366.16 | − |
(2) Consolidated Financial Positions | (Millions of yen) | |||||||||
Total assets | Net assets | Equity ratio | ||||||||
September 30, 2022 | 1,963,266 | 1,732,514 | 88.1% | |||||||
March 31, 2022 | 1,769,951 | 1,559,274 | 87.9% | |||||||
(Reference) | Shareholders' equity As of September 30, 2022 : | ¥ | 1,728,841 million | |||||||
As of March 31, 2022 : | ¥ | 1,555,628 million | ||||||||
2. Dividends | (Yen) | |||||||||
For the year | Dividend per share | |||||||||
ended March 31 | 1Q | 2Q | 3Q | 4Q | Total | |||||
2022 (Actual) | − | 300.00 | − | 450.00 | 750.00 | |||||
2023 (Actual) | − | 450.00 | NA | NA | NA | |||||
2023 (Projected) | NA | NA | − | 450.00 | 900.00 | |||||
(Note) | Revision of dividends forecast during this period : None |
― 1 ― | SMC Corporation |
3. Forecasts of Consolidated Operating Results for the Year ending March 31, 2023
(Millions of yen, except per share figures) | ||||||||||
Profit | Net income | |||||||||
Net sales | Operating profit | Ordinary profit | attributable to | per share | ||||||
owners of parent | (Yen) | |||||||||
Year ending | 824,000 | 13.3% | 248,500 | 9.1% | 302,000 | 10.6% | 220,000 | 14.0% | 3,366.98 | |
March 31, 2023 | ||||||||||
(Note) | Revision of forecasts of operating results during this period : Yes |
- Notes
- Changes in significant subsidiaries during the second quarter ended September 30, 2022 : None
- Adoption of special accounting methods for presenting quarterly consolidated financial statements : Yes
- Changes in accounting policies, changes in accounting estimates and retrospective restatement
- Changes in accounting policies applied due to revisions of accounting standards : Yes
- Changes in accounting policies other than the above : None
- Changes in accounting estimates : None
- Retrospective restatement : None
- Number of shares issued
- Number of common shares issued (including treasury shares)
As of September 30, 2022 | 67,369,359 | |
As of March 31, 2022 | 67,369,359 | |
2. Number of treasury shares | ||
As of September 30, 2022 | 2,029,283 | |
As of March 31, 2022 | 2,029,013 | |
3. Average number of common shares for the six months ended | ||
April 1, 2022 to September 30, 2022 | 65,340,286 | |
April 1, 2021 to September 30, 2021 | 66,075,009 | |
(Note) The company's shares held by the Board Benefit Trust (BBT) for the Directors' Stock Compensation Plan (2,600 shares as of September 30, 2021 and as of March 31, 2022, and as of September 30, 2022) is included in the number of treasury shares, which is excluded in the calculation for the above: 2. Number of treasury shares and 3. Average number of common shares for the six months ended.
These quarterly consolidated financial highlights are not subject to quarterly review procedures by the independent accounting auditor.
Explanation of appropriate use of financial forecasts; other special items
- The revised forecasts of operating results for the fiscal year ending March 31, 2023 (consolidated) are shown in this release.
-
Forecasts are based on information and certain premises that the Company considers to be reasonable at the time these consolidated quarterly financial highlights are released.
Some factors could cause actual results to differ from expectations.
― 2 ― | SMC Corporation |
1.Qualitative Information about the Quarterly Results
(1) Operating Results
During the period up to the second quarter of the fiscal year 2022 (from April 1, 2022 to September 30, 2022), the global economy and capital investment demands within a wide range of industries have seen recoveries from the economic impacts due to the Coronavirus (COVID-19) outbreak. However, a high degree of future uncertainty has continued with supply chain disruptions mainly with the shortage of parts and raw materials in semi- conductors, the stagnation of economic activity in China due to its zero-covid strategy, the prolonged Russian military invasion of Ukraine, accelerating inflation, and sharp exchange rate fluctuations.
The demand for automation control equipment within the semi-conductor and electronic industries in the first half of period has remained high within China, other regions in Asia, and in Japan, however, from July onward, the growth was sluggish, partly due to seasonal factors. The demand within the automotive industry increased for the electric vehicle batteries in each region, despite the continued adverse effects on production from the shortage of semi-conductors.The demand for machine tools has also done well in the global market outside Japan, and the food, medical equipment manufacturing and other industries have remained strong in the market, due to the post- covid's new demand for labor-savingautomation.
Within this business environment, the SMC Group has continued to strive to avoid the impacts of part and raw material shortages on its production capabilities. At the same time, SMC has continued to make aggressive capital investments to secure its product supply capabilities to meet its customers' demands and create multi-location production facilities to withstand disasters based on SMC's BCP (Business Continuity Plan) initiatives. In addition, SMC has also continued to develop new products with highly environmentally friendly features which contribute to a significant CO2 emission reduction for its customers and has strived to strengthen its global sales collaboration with its IT infrastructure.
As a result, the consolidated net sales of SMC were 421,529 million yen (increased by 17.5% from the previous corresponding period) mainly from increase in sales quantity and increase in revenue from the foreign exchange fluctuations for the sales in overseas. Operating profit was 133,649 million yen (increased by 13.2%) due to the revenue increase, in spite of the increases in selling, general and administrative expenses mainly from increases in logistics, personnel, and IT related costs. Ordinary profit was 180,725 million yen (increased by 43.3%), with the increases in interest income from the interest rate increase in the market and in foreign exchange gains from depreciation of the yen. With the sale of investment securities, profit before income taxes was 183,498 million yen (increased by 45.8%), and profit attributable to owners of parent was 133,054 million yen (increased by 47.4%).
ROE became 8.1%, increased by 1.7 points from the previous corresponding period.
(2) Financial Positions
Total assets as of the end of the second quarter of the fiscal year 2022 were 1,963,266 million yen, a 193,314 million yen increase from the previous fiscal year end. Cash and deposits were 705,107 million yen, a 20,273 million yen increase from the previous fiscal year end due to the increase in profit and gains from the foreign exchange on the foreign currency deposits. Notes and accounts receivable-trade were 235,716 million yen, a 23,777 million yen increase from the previous fiscal year end, resulted from the increase in revenue and revenue from the exchange fluctuations on the sales in overseas. Inventories were 367,289 million yen, a 63,743 million yen increase from the previous fiscal year end, by increasing product inventories to correspond to the high demands and by strategically increasing parts and raw material inventories to overcome recent constraints on supply chains. Property, plant and equipment was 314,939 million yen, a 44,355 million yen increase from the previous fiscal year end, by further increasing investments for the production and logistics facilities within and outside of Japan, from the perspectives to secure productions capabilities in order to correspond to the rising demands and to enforce BCP to enhance its sustainable capability of supplying its products. SMC also acquired land for the relocation of the SMC's core technical center in Tsukuba as to further enhance its engineering functions and to attract talented engineering staffs.
― 3 ― | SMC Corporation |
Total liabilities were 230,751 million yen, increased by 20,074 million yen from the previous fiscal year end. Notes and accounts payable-trade were 71,354 million yen, a 9,253 million yen increase from the previous fiscal year end, resulted from the purchase increase from the increase in sales and strategically increasing parts and raw materials procurements. Other under current liabilities was 59,412 million yen, a 9,232 million yen increase from the increased bonus related accrued expenses.
Total net assets were 1,732,514 million yen, increased by 173,240 million yen from the previous fiscal year end, due to the increases in retained earnings resulted from the increase in profit, and 156,751 million yen, a 68,857 million yen increase in foreign currency translation adjustment from the depreciation of yen.
Equity ratio became 88.1%, increased by 0.2 point from the previous fiscal year end.
(3) Consolidated Forecasts and Other Forward-Looking Information
Based on recent trends in orders and foreign exchange rates, revisions to the consolidated forecast for the fiscal year 2022, announced in the "Consolidated Financial Highlights for the Year ended March 31, 2022 [under Japanese GAAP]" issued on May 13, 2022 are made as below.
The average exchange rates for the fiscal year based on the revised forecasts:
1 US$ = 138 yen (previous forecast 123 yen), 1 EUR = 139 yen (133 yen), and 1 CNY = 19.80 yen (18.50 yen). For further detail, please refer to "Difference between Consolidated Forecasts and Actual Results for the Accumulated Second Quarter, and the Revision to Consolidated Forecasts for FY 2022", disclosed today,
November 14, 2022.
Revision to consolidated financial forecasts for the fiscal year ending March 31, 2023
(Period from April 1, 2022 through March 31, 2023)
Net Sales | Operating | Ordinary | Profit attributable | Net Income | |
Profit | Profit | to owners of parent | per share | ||
Previous Forecasts (A) | (Millions of Yen) | (Millions of Yen) | (Millions of Yen) | (Millions of Yen) | (Yen) |
805,000 | 255,000 | 265,000 | 188,000 | 2,877.24 | |
Revised Forecasts (B) | 824,000 | 248,500 | 302,000 | 220,000 | 3,366.98 |
Increased / Decreased Amount | 19,000 | (6,500) | 37,000 | 32,000 | − |
(B-A) | |||||
Rate of Change (%) | 2.4 | (2.5) | 14.0 | 17.0 | − |
Results of the FY 2021 | 727,397 | 227,857 | 272,981 | 192,991 | 2,923.76 |
(Year ended March 31, 2022) | |||||
Since June of 2022, SMC has frozen all exports to and new investments at its Russian subsidiaries. If SMC were to complete a full withdrawal from the Russian market in the future, there is a risk that SMC will not be able to obtain the required permits and approvals from the local authorities to recover SMC's remaining assets within the country. As such, the SMC group may see damages of up to 13 billion yen from the loss of these assets.
― 4 ― | SMC Corporation |
2. Quarterly Consolidated Financial Statements
(1) Quarterly Consolidated Balance Sheet
(Millions of yen) | |||
Year end | Second Quarter end | ||
-Previous year | -Current year | ||
As of March 31, 2022 As of September 30, 2022 | |||
[ASSETS] | |||
Current assets | |||
Cash and deposits | 684,834 | 705,107 | |
Notes and accounts receivable-trade | 211,939 | 235,716 | |
Securities | 12,219 | 14,316 | |
Merchandise and finished goods | 130,829 | 152,691 | |
Work in process | 25,574 | 28,861 | |
Raw materials and supplies | 147,141 | 185,736 | |
Other | 46,769 | 32,186 | |
Allowance for doubtful accounts | (901) | (886) | |
Total current assets | 1,258,406 | 1,353,729 | |
Non-current assets | |||
Property, plant and equipment | |||
Buildings and structures, net | 91,705 | 118,184 | |
Machinery, equipment and vehicles, net | 41,988 | 48,934 | |
Land | 74,775 | 83,822 | |
Other, net | 62,115 | 63,997 | |
Total property, plant and equipment | 270,584 | 314,939 | |
Intangible assets | 15,183 | 17,275 | |
Investments and other assets | |||
Investment securities | 58,750 | 112,943 | |
Insurance funds | 150,797 | 146,393 | |
Other | 17,892 | 19,585 | |
Allowance for doubtful accounts | (1,664) | (1,601) | |
Total investments and other assets | 225,776 | 277,321 | |
Total non-current assets | 511,545 | 609,536 | |
Total assets | 1,769,951 | 1,963,266 | |
― 5 ― | SMC Corporation |
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SMC Corporation published this content on 14 November 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 14 November 2022 06:11:26 UTC.