TIDMMEL
RNS Number : 2117X
Mitsubishi Electric Corporation
26 April 2019
FOR IMMEDIATE RELEASE No. 3278
Investor Relations Inquiries Media Inquiries
Investor Relations Group, Corporate Public Relations Division
Finance Division
Mitsubishi Electric Corporation Mitsubishi Electric Corporation
Cad.Irg@rk.MitsubishiElectric.co.jp prd.gnews@nk.MitsubishiElectric.co.jp
www.MitsubishiElectric.com/news/
Mitsubishi Electric Announces Consolidated Financial Results for
Fiscal 2019
TOKYO, April 26, 2019 - Mitsubishi Electric Corporation (TOKYO:
6503) announced today its consolidated financial results for fiscal
2019 (April 1, 2018- March 31, 2019).
Consolidated Financial Results
Revenue: 4,519.9 billion (2% increase from the previous
yen fiscal year)
Operating profit: 290.4 billion (11% decrease from the previous
yen fiscal year)
Profit before income 315.9 billion (11% decrease from the previous
taxes: yen fiscal year)
Net profit attributable 226.6 billion (11% decrease from the previous
to Mitsubishi Electric yen fiscal year)
Corp. stockholders:
During the fiscal year ended March 31, 2019, the economy saw a
buoyant expansion in the U.S. and a slight slowdown in the Chinese
economy, while there were gradual trends of recovery in Japan and
Europe despite a recent slowdown in some indicators such as export
and production. In addition, the yen, compared to the previous
fiscal year, was substantially unchanged against the U.S. dollar,
and remained strong against the euro in and after August.
Under these circumstances, the Mitsubishi Electric Group has
been working even harder than before to promote growth strategies
rooted in its advantages, while continuously implementing
initiatives to strengthen its competitiveness and business
structure.
As a result, the Mitsubishi Electric Group has recorded a
revenue of 4,519.9 billion yen for fiscal 2019, an increase of 2%
compared to the previous fiscal year, with increased revenue mainly
in the Energy and Electric Systems, Industrial Automation Systems
and Home Appliances segments.
Consolidated operating profit decreased by 11% compared to the
previous fiscal year to 290.4 billion yen, due to decreased profits
in the Industrial Automation Systems and Electronic Devices
segments.
Profit before income taxes decreased by 11% compared to the
previous fiscal year to 315.9 billion yen, and net profit
attributable to Mitsubishi Electric Corporation stockholders
decreased by 11% compared to the previous fiscal year to 226.6
billion yen.
Consolidated Financial Results by Business Segment
Energy and Electric Systems
Revenue: 1,296.7 billion (3% increase from the previous fiscal
yen year which recorded 1,253.0 billion
yen)
Operating profit: 82.5 billion (17.0 billion yen increase from
yen the previous fiscal year which recorded
65.4 billion yen)
The social infrastructure systems business remained
substantially unchanged in orders compared to the previous fiscal
year, while revenue increased compared to the previous fiscal year
due primarily to increases in the transportation systems business
inside and outside Japan and the power systems business in
Japan.
The building systems business remained substantially unchanged
in both orders and revenue compared to the previous fiscal year,
experiencing a decrease in the new installation of elevators and
escalators in China and buoyant growth in the renewal business in
Japan and other factors.
As a result, revenue for this segment increased by 3% from the
previous fiscal year to 1,296.7 billion yen. Operating profit
increased by 17.0 billion yen from the previous fiscal year to 82.5
billion yen due primarily to an increase in revenue.
Industrial Automation Systems
Revenue: 1,467.6 billion (2% increase from the previous fiscal
yen year which recorded 1,444.9 billion
yen)
Operating profit: 142.5 billion (44.7 billion yen decrease from
yen the previous fiscal year which recorded
187.3 billion yen)
The factory automation systems business saw decreases in both
orders and revenue from the previous fiscal year due primarily to a
decrease in capital expenditures in the fields of organic light
emitting diodes (OLED) and smartphones outside Japan, despite
buoyant demand in Japan.
The automotive equipment business saw increases in both orders
and revenue from the previous fiscal year due primarily to
increases in Japan, Europe and other markets in Asia, as well as
increased revenue in electric-vehicle related equipment in response
to market growth worldwide.
As a result, revenue for this segment increased by 2% from the
previous fiscal year to 1,467.6 billion yen. Operating profit
decreased by 44.7 billion yen from the previous fiscal year to
142.5 billion yen due primarily to a shift in product mix,
increases in material prices and upfront investment for growth
drivers.
Information and Communication Systems
Revenue: 426.2 billion (3% decrease from the previous fiscal
yen year which recorded 438.1 billion
yen)
Operating profit: 12.2 billion (0.9 billion yen increase from the
yen previous fiscal year which recorded
11.3 billion yen)
The telecommunications systems business saw decreases in both
orders and revenue compared to the previous fiscal year due
primarily to decreased demand in communications infrastructure
equipment.
The information systems and service business remained
substantially unchanged in orders, while revenue increased compared
to the previous fiscal year owing to an increase in the system
integrations business.
The electronic systems business saw a decrease in orders
compared to the previous fiscal year mainly due to a decrease in
the space systems business, while revenue experienced a decrease
compared to the previous fiscal year due primarily to a decrease in
the defense systems business.
As a result, revenue for this segment decreased by 3% from the
previous fiscal year to 426.2 billion yen. Operating profit
increased by 0.9 billion yen from the previous fiscal year to 12.2
billion yen due primarily to a shift in project portfolios.
Electronic Devices
Revenue: 199.9 billion (1% decrease from the previous
yen fiscal year which recorded 202.2
billion yen)
Operating profit: 1.4 billion (12.7 billion yen decrease from
yen the previous fiscal year which
recorded 14.1 billion yen)
The electronic devices business saw a decrease in orders and
revenue fell by 1% from the previous fiscal year to 199.9 billion
yen mainly due to decreased demand for optical communication
devices.
Operating profit decreased by 12.7 billion yen from the previous
fiscal year to 1.4 billion yen due primarily to a decrease in
revenue and a shift in product mix.
Home Appliances
Revenue: 1,074.0 billion (2% increase from the previous
yen fiscal year which recorded 1,049.3
billion yen)
Operating profit: 59.4 billion (3.9 billion yen increase from
yen the previous fiscal year which
recorded 55.4 billion yen)
The home appliances business saw a 2% increase in revenue from
the previous fiscal year to 1,074.0 billion yen due to increases in
revenue of air conditioners for Japan, Europe and North
America.
Operating profit increased by 3.9 billion yen compared to the
previous fiscal year to 59.4 billion yen due primarily to an
increase in revenue.
Others
Revenue: 676.7 billion (3% increase from the previous
yen fiscal year which recorded 659.0
billion yen)
Operating profit: 24.1 billion (0.1 billion yen increase from
yen the previous fiscal year which
recorded 24.0 billion yen)
Revenue increased by 3% compared to the previous fiscal year to
676.7 billion yen mainly due to an increase in revenue at
affiliated companies involved in logistics.
Operating profit increased by 0.1 billion yen from the previous
fiscal year to 24.1 billion yen due primarily to an increase in
revenue.
Fundamental Dividend Distribution Policy and FY2019 Dividend
Fundamental dividend distribution policy
Mitsubishi Electric's fundamental policy is to comprehensively
promote improvement in shareholder profit from the viewpoints of
appropriate profit distribution commensurate with earnings
performance of the respective fiscal year, as well as strengthening
our financial standing through the company's internal reserves,
with the ultimate goal of enhancing corporate value.
FY 2019 dividend
Considering the company's business performance and financial
conditions in fiscal 2019, the company has decided to pay a
year-end retained earnings dividend of 26 yen per share for fiscal
2019. Adding the interim dividend of 14 yen per share, the total
annual dividend will be 40 yen per share. Payment is planned to
begin on June 4, 2019.
The retained earnings dividend for fiscal 2020 is still
undecided.
cf. In fiscal 2018, interim dividend was 14 yen and year-end
dividend was 26 yen per share. (Annual dividend of 40 yen per
share)
Financial Standing
An analysis on the status of assets, liabilities and equity on a
consolidated basis
Total assets as of the end of this fiscal year increased from
the end of the previous fiscal year by 50.6 billion yen to 4,356.2
billion yen. The change in the balance of total assets was mainly
due to increases in the balance of inventories by 82.8 billion yen
and in trade receivables and contract assets by 42.3 billion yen,
while cash and cash equivalents decreased by 84.9 billion yen.
Total liabilities decreased from the end of the previous fiscal
year by 63.3 billion yen to 1,845.0 billion yen. The outstanding
balances of bonds and borrowings decreased by 13.5 billion yen from
the end of the previous fiscal year to 298.4 billion yen, resulting
in a decline in the ratio of bonds and borrowings to total assets
to 6.9%, representing a 0.3 point decrease compared to the end of
the previous fiscal year. Meanwhile, trade payables decreased by
19.9 billion yen, and other current liabilities decreased by 34.0
billion yen.
Mitsubishi Electric Corporation stockholders' equity increased
by 105.7 billion yen compared to the end of the previous fiscal
year to 2,399.9 billion yen. The stockholders' equity ratio was
recorded at 55.1%, representing a 1.8 point increase compared to
the end of the previous fiscal year. The changes referred to above
primarily resulted from an increase from recording a net profit
attributable to Mitsubishi Electric Corporation stockholders of
226.6 billion yen, despite a decrease due to dividend payment of
85.8 billion yen and a decrease in other comprehensive income of
45.6 billion yen reflecting a fall in stock prices and the stronger
yen.
An analysis on the status of cash flow on a consolidated
basis
Cash flows from operating activities for this fiscal year
decreased by 25.9 billion yen compared to the previous fiscal year
to 239.8 billion yen (cash in) mainly due to a decrease in net
profit. Cash flows from investing activities increased by 28.6
billion yen compared to the previous fiscal year to 210.6 billion
yen (cash out), due primarily to a decrease in proceeds from sale
of investment securities. As a result, free cash flow was 29.1
billion yen (cash in). Cash flows from financing activities were
112.0 billion yen (cash out) mainly due to dividend payments.
Current Forecast for Fiscal 2020
With uncertainty in the global economy due to factors such as
U.S. trade policies and influences from Brexit, the global economy
is expected to experience a slowdown in growth due to the
U.S.-China trade friction making impact on exports and investments
in various countries and regions, despite a gradual recovery trend
in global business conditions.
Under these circumstances, the Mitsubishi Electric Group aims to
achieve its management targets by uplifting its business
performance and financial standings through initiatives such as
promoting more strongly its global operations centered around its
growth-driving businesses, continuously increasing and
strengthening profitability in each business and continuously
implementing various Group-wide business improvement measures.
The current financial performance forecast for fiscal 2020
follows below.
Current consolidated forecast for fiscal 2020
Revenue 4,630.0 billion (2% increase from fiscal
yen 2019)
Operating profit 295.0 billion (2% increase from fiscal
yen 2019)
Profit before income 320.0 billion (1% increase from fiscal
taxes yen 2019)
Net profit attributable 240.0 billion (6% increase from fiscal
to Mitsubishi Electric yen 2019)
Corp. stockholders
Exchange rates for this forecast is 105 yen to the US dollar,
125 yen to the euro and 16.0 yen to the Chinese yuan.
Note: The results forecast above is based on assumptions deemed
reasonable by the company at the present time, and actual results
may differ significantly from forecasts. Please refer to the cautionary
statement at the end.
Policy Regarding Financial Reporting Standards
Mitsubishi Electric has voluntarily adopted International
Financial Reporting Standards (IFRS) for its consolidated financial
statements from the first quarter of the fiscal year ended March
31, 2019, in order to enhance international comparability of its
financial information in the capital markets.
Consolidated Financial Results Summary
(In billions of yen except where noted)
FY '18 (A) FY '19 (B) B - A B/A (%)
(Apr. 1, 2017 (Apr. 1, 2018
- -
Mar. 31, 2018) Mar. 31, 2019)
---------------- ---------------- --------- --------
Revenue 4,444.4 4,519.9 75.4 102
---------------- ---------------- --------- --------
Operating profit 327.4 290.4 (36.9) 89
---------------- ---------------- --------- --------
Profit before income
taxes 353.2 315.9 (37.2) 89
---------------- ---------------- --------- --------
Net profit attributable
to
Mitsubishi Electric
Corp.
stockholders 255.7 226.6 (29.1) 89
---------------- ----------------
Basic earnings per
share attributable
to Mitsubishi Electric (13.(54)
Corp. stockholders 119.(19) yen 105.(65) yen yen) 89
============================== ================ ================ ========= ========
Dividend per share
Annual dividend 40 yen 40 yen _ 100
Interim dividend 14 yen 14 yen _
Year-end dividend 26 yen 26 yen _
---------------- ---------------- --------- --------
Notes:
1) Consolidated financial charts made in accordance with
International Financial Reporting Standards (IFRS).
2) The company has 206 consolidated subsidiaries.
Consolidated Financial Statements
Consolidated Statements of Profit or Loss and Consolidated
Statements of Comprehensive Income (Fiscal 2019)
(Consolidated Statements of Profit or Loss)
(In millions of yen)
FY '18 FY '19
(Apr. 1, 2017 (Apr. 1, 2018
- -
Mar. 31, 2018) Mar. 31, 2019)
(A) % of (B) % of B - A B/A
total total (%)
---------- -------
Revenue 4,444,424 100.0 4,519,921 100.0 75,497 102
Cost of sales 3,090,449 69.5 3,186,869 70.5 96,420 103
Selling, general and
administrative expenses 1,021,361 23.0 1,043,294 23.1 21,933 102
Other profit (loss) (5,170) (0.1) 719 0.0 5,889 -
Operating profit 327,444 7.4 290,477 6.4 (36,967) 89
Financial income 8,611 0.2 9,747 0.2 1,136 113
Financial expenses 6,796 0.2 4,382 0.1 (2,414) 64
Share of profit of investments
accounted for using the
equity method 23,947 0.5 20,116 0.5 (3,831) 84
---------------------------------- ---------- ------- ---------- ------- --------- -----
Profit before income
taxes 353,206 7.9 315,958 7.0 (37,248) 89
Income taxes 86,807 1.9 78,304 1.7 (8,503) 90
---------- ------- ---------- ------- --------- -----
Net profit 266,399 6.0 237,654 5.3 (28,745) 89
---------- ------- ---------- ------- --------- -----
Net profit attributable
to:
Mitsubishi Electric Corp.
stockholders 255,755 5.8 226,648 5.0 (29,107) 89
Non-controlling interests 10,644 0.2 11,006 0.3 362 103
---------- ------- ---------- ------- --------- -----
(Consolidated Statements of Comprehensive Income)
(In millions of yen)
FY '18 (A) FY '19 (B) B - A
(Apr. 1, 2017 (Apr. 1, 2018
- -
Mar. 31, 2018) Mar. 31, 2019)
---------------- ----------------
Net profit 266,399 237,654 (28,745)
---------------- ---------------- ----------
(Other comprehensive income
(loss),
net of tax)
Items that will not be reclassified
to
net profit
Changes in fair value of financial
assets measured at fair value
through other comprehensive
income (52) (39,284) (39,232)
------------------------------------------ ---------------- ---------------- ----------
Remeasurements of defined
benefit plans 21,323 12,234 (9,089)
------------------------------------------ ---------------- ---------------- ----------
Share of other comprehensive
income of investments accounted
for using the equity method 170 (995) (1,165)
---------------- ---------------- ----------
Subtotal 21,441 (28,045) (49,486)
---------------- ---------------- ----------
Items that may be reclassified
to net profit
Exchange differences on translating
foreign operations 16,992 (6,756) (23,748)
------------------------------------------ ---------------- ---------------- ----------
Net changes in the fair value
of cash flow hedges (71) (37) 34
------------------------------------------ ---------------- ---------------- ----------
Share of other comprehensive
income of investments accounted
for using the equity method 1,869 (2,645) (4,514)
---------------- ---------------- ----------
Subtotal 18,790 (9,438) (28,228)
---------------- ---------------- ----------
Total other comprehensive
income (loss) 40,231 (37,483) (77,714)
---------------- ---------------- ----------
Comprehensive income 306,630 200,171 (106,459)
---------------- ---------------- ----------
Comprehensive income attributable
to:
Mitsubishi Electric Corp.
stockholders 294,710 189,306 (105,404)
Non-controlling interests 11,920 10,865 (1,055)
---------------- ---------------- ----------
Consolidated Statements of Financial Position
(In millions of yen)
FY '18 (A) FY ' 19 (B) B - A
(ended Mar. (ended Mar.
31, 2018) 31, 2019)
--------------------- ---------------------
(Assets)
Current assets 2,582,735 2,624,293 41,558
Cash and cash equivalents 599,199 514,224 (84,975)
Trade receivables and contract
assets 1,191,529 1,233,916 42,387
Inventories 646,262 729,098 82,836
Other current assets 145,745 147,055 1,310
Non-current assets 1,722,845 1,731,918 9,073
Investments accounted for using
the equity method 194,308 197,959 3,651
Other financial assets 363,171 303,834 (59,337)
Property, plant and equipment 724,257 760,540 36,283
Other non-current assets 441,109 469,585 28,476
--------------------- --------------------- ---------
Total assets 4,305,580 4,356,211 50,631
========================================= ===================== ===================== =========
(Liabilities)
Current liabilities 1,488,249 1,416,335 (71,914)
Bonds and borrowings 122,895 104,969 (17,926)
Trade payables 579,566 559,641 (19,925)
Other current liabilities 785,788 751,725 (34,063)
Non-current liabilities 420,112 428,721 8,609
Bonds and borrowings 189,055 193,469 4,414
Retirement benefit liabilities 171,520 176,087 4,567
Other non-current liabilities 59,537 59,165 (372)
--------------------- --------------------- ---------
Total liabilities 1,908,361 1,845,056 (63,305)
--------------------- --------------------- ---------
(Equity)
Mitsubishi Electric Corp. stockholders'
equity 2,294,174 2,399,946 105,772
Common stock 175,820 175,820
Capital surplus 199,442 202,834 3,392
Retained earnings 1,811,348 1,960,466 149,118
Accumulated other comprehensive
income (loss) 109,492 63,809 (45,683)
Treasury stock, at cost (1,928) (2,983) (1,055)
Non-controlling interests 103,045 111,209 8,164
--------------------- --------------------- ---------
Total equity 2,397,219 2,511,155 113,936
--------------------- --------------------- ---------
Total liabilities and equity 4,305,580 4,356,211 50,631
========================================= ===================== ===================== =========
Bonds and borrowings 311,950 298,438 (13,512)
Accumulated other comprehensive
income (loss):
Exchange differences on translating
foreign operations 17,549 8,368 (9,181)
Financial assets measured at fair
value through other comprehensive
income 91,952 55,503 (36,449)
Net changes in the fair value of
cash flow hedges (9) (62) (53)
Consolidated Statements of Changes in Equity
FY '18 (Apr. 1, 2017 - Mar. 31, 2018)
(In millions of yen)
Mitsubishi Electric Corp. stockholders' Non-controlling Total
equity interests equity
Common Capital Retained Accumulated Treasury Total
stock surplus earnings other stock,
comprehensive at cost
income
(loss)
----------
Balance at
beginning
of period 175,820 198,745 1,593,660 101,166 (1,228) 2,068,163 98,800 2,166,963
================== ======== ======== ========== ============== ========= ========== ================ ==========
Comprehensive
income
Net profit 255,755 255,755 10,644 266,399
Other
comprehensive
income
(loss),
net of tax 38,955 38,955 1,276 40,231
-------- -------- ---------- -------------- --------- ---------- ---------------- ----------
Comprehensive
income 255,755 38,955 294,710 11,920 306,630
-------- -------- ---------- -------------- --------- ---------- ---------------- ----------
Transfer to
retained
earnings 30,629 (30,629)
Dividends (68,696) (68,696) (7,085) (75,781)
Purchase of
treasury
stock (700) (700) (700)
Disposal of
treasury
stock 0 0 0 0
Transactions with
non-controlling
interests and
other 697 697 (590) 107
-------- -------- ---------- -------------- --------- ---------- ---------------- ----------
Balance at end
of period 175,820 199,442 1,811,348 109,492 (1,928) 2,294,174 103,045 2,397,219
================== ======== ======== ========== ============== ========= ========== ================ ==========
FY '19 (Apr. 1, 2018 - Mar. 31, 2019)
(In millions of yen)
Mitsubishi Electric Corp. stockholders' Non-controlling Total
equity interests equity
Common Capital Retained Accumulated Treasury Total
stock surplus earnings other stock,
comprehensive at cost
income
(loss)
----------
Balance at
beginning
of period 175,820 199,442 1,811,348 109,492 (1,928) 2,294,174 103,045 2,397,219
================== ======== ======== ========== ============== ========= ========== ================ ==========
Comprehensive
income
Net profit 226,648 226,648 11,006 237,654
Other
comprehensive
income
(loss),
net of tax (37,342) (37,342) (141) (37,483)
-------- -------- ---------- -------------- --------- ---------- ---------------- ----------
Comprehensive
income 226,648 (37,342) 189,306 10,865 200,171
-------- -------- ---------- -------------- --------- ---------- ---------------- ----------
Transfer to
retained
earnings 8,341 (8,341)
Dividends (85,871) (85,871) (5,872) (91,743)
Purchase of
treasury
stock (1,055) (1,055) (1,055)
Disposal of
treasury
stock 0 0 0 0
Transactions with
non-controlling
interests and
other 3,392 3,392 3,171 6,563
-------- -------- ---------- -------------- --------- ---------- ---------------- ----------
Balance at end
of period 175,820 202,834 1,960,466 63,809 (2,983) 2,399,946 111,209 2,511,155
================== ======== ======== ========== ============== ========= ========== ================ ==========
Consolidated Statements of Cash Flows
(In millions of yen)
FY '18 FY '19 B - A
(Apr. 1, 2017 (Apr. 1,
- Mar. 31, 2018 - Mar.
2018) 31, 2019)
(A) (B)
--------------- --------------
I Cash flows from operating activities
1 Net profit 266,399 237,654 (28,745)
2 Adjustments to cash flows from
operating activities
(1) Depreciation, amortization
and other 181,474 178,892 (2,582)
(2) Decrease (increase) in trade
receivables and contract assets (32,348) (40,780) (8,432)
(3) Decrease (increase) in inventories (82,975) (82,718) 257
(4) Increase (decrease) in trade
payables (57,717) (20,792) 36,925
(5) Other, net (9,065) (32,439) (23,374)
---- --------------------------------------- --------------- -------------- ---------
Cash flows from operating activities 265,768 239,817 (25,951)
II Cash flows from investing activities
Purchase of property, plant and
1 equipment (186,792) (188,042) (1,250)
Proceeds from sale of property,
2 plant and equipment 3,005 4,170 1,165
Purchase of investment securities
3 (net of cash acquired) (8,518) (13,304) (4,786)
Proceeds from sale of investment
4 securities (net of cash disposed) 35,194 11,824 (23,370)
5 Other, net (24,904) (25,316) (412)
---- --------------------------------------- --------------- -------------- ---------
Cash flows from investing activities (182,015) (210,668) (28,653)
I +
II Free cash flow 83,753 29,149 (54,604)
III Cash flows from financing activities
Proceeds and repayment of bonds
1 and long-term borrowings (44,006) (22,892) 21,114
Increase (decrease) in short-term
2 borrowings, net (27,496) (2,077) 25,419
3 Dividends paid (68,696) (85,871) (17,175)
4 Purchase of treasury stock (700) (1,055) (355)
5 Disposal of treasury stock 0 0 0
6 Other, net (8,915) (172) 8,743
---- --------------------------------------- --------------- -------------- ---------
Cash flows from financing activities (149,813) (112,067) 37,746
Effect of exchange rate changes
IV on cash and cash equivalents 2,790 (2,057) (4,847)
---- --------------------------------------- --------------- -------------- ---------
Net increase (decrease) in cash
V and cash equivalents (63,270) (84,975) (21,705)
---- --------------------------------------- --------------- -------------- ---------
Cash and cash equivalents at
VI beginning of period 662,469 599,199 (63,270)
---- --------------------------------------- --------------- -------------- ---------
Cash and cash equivalents at
VII end of period 599,199 514,224 (84,975)
---- --------------------------------------- --------------- -------------- ---------
Consolidated Segment Information (Fiscal 2019)
1. Revenue and Operating Profit by Business Segment
(In millions of yen)
Business Segment FY '18 FY '19 C - A D - B C/A
(Apr. 1, 2017 (Apr. 1, 2018 (%)
- -
Mar. 31, 2018) Mar. 31, 2019)
----------------------
Revenue Operating Revenue Operating
(A) profit (C) profit
(B) (D)
---------- ---------- ----------
Energy and Electric
Systems 1,253,062 65,457 1,296,745 82,501 43,683 17,044 103
---------- ---------- ---------- ---------- --------- --------- -----
Industrial Automation
Systems 1,444,928 187,350 1,467,633 142,563 22,705 (44,787) 102
---------- ---------- ---------- ---------- --------- --------- -----
Information and
Communication Systems 438,184 11,340 426,269 12,247 (11,915) 907 97
---------- ---------- ---------- ---------- --------- --------- -----
Electronic Devices 202,294 14,164 199,908 1,442 (2,386) (12,722) 99
---------- ---------- ---------- ---------- --------- --------- -----
Home Appliances 1,049,369 55,496 1,074,044 59,451 24,675 3,955 102
---------- ---------- ---------- ---------- --------- --------- -----
Others 659,059 24,034 676,736 24,172 17,677 138 103
---------- ---------- ---------- ---------- --------- --------- -----
Subtotal 5,046,896 357,841 5,141,335 322,376 94,439 (35,465) 102
---------- ---------- ---------- ---------- --------- --------- -----
Eliminations and
other (602,472) (30,397) (621,414) (31,899) (18,942) (1,502)
---------- ---------- ---------- ---------- --------- --------- -----
Consolidated Total 4,444,424 327,444 4,519,921 290,477 75,497 (36,967) 102
---------- ---------- ---------- ---------- --------- --------- -----
*Notes: Inter-segment revenue are included in the above
chart.
2. Revenue by Location of Customers
(In millions of yen)
Location of Customers FY '18 FY '19 B - A B/A (%)
(Apr. 1, 2017 (Apr. 1, 2018
- -
Mar. 31, 2018) Mar. 31, 2019)
----------------------- -----------------------
Revenue % of total Revenue % of total
(A) revenue (B) revenue
---------- ----------- ---------- -----------
Japan 2,438,942 54.9 2,556,644 56.6 117,702 105
------------------------- ---------- ----------- ---------- ----------- --------- --------
North America 419,121 9.4 429,451 9.5 10,330 102
---------- ----------- ---------- ----------- --------- --------
Asia (excluding
Japan) 1,089,176 24.5 1,013,883 22.4 (75,293) 93
---------- ----------- ---------- ----------- --------- --------
China 545,072 12.3 486,405 10.8 (58,667) 89
---------- ----------- ---------- ----------- --------- --------
Europe 431,316 9.7 453,748 10.0 22,432 105
------------------------ ---------- ----------- ---------- ----------- --------- --------
Others 65,869 1.5 66,195 1.5 326 100
------------------------ ---------- ----------- ---------- ----------- --------- --------
Total overseas
revenue 2,005,482 45.1 1,963,277 43.4 (42,205) 98
------------------------- ---------- ----------- ---------- ----------- --------- --------
Consolidated total 4,444,424 100.0 4,519,921 100.0 75,497 102
---------- ----------- ---------- ----------- --------- --------
Notes to the Consolidated Financial Statements
(Matters regarding the scope of consolidation and application of
the equity method: changes against the previous fiscal year
end)
Number of subsidiaries: 206 (Added: 5; Excluded: 4)
Number of equity method associates: 37 (Added: 1; Excluded:
0)
(Per share information)
FY '18 FY '19
(Apr. 1, 2017 - (Apr. 1, 2018 -
Mar. 31, 2018) Mar. 31, 2019)
Net profit attributable
to Mitsubishi Electric Corp. 255,755 million 226,648 million
stockholders yen yen
--------------------- ---------------------
Effect of potential ordinary
shares
--------------------- ---------------------
Diluted Net profit attributable
to Mitsubishi Electric Corp. 255,755 million 226,648 million
stockholders yen yen
-------------------------------- --------------------- ---------------------
Average ordinary shares
outstanding 2,145,808,679 shares 2,145,198,524 shares
--------------------- ---------------------
Cause of dilution
Stock options
--------------------- ---------------------
Adjusted ordinary shares
outstanding 2,145,808,679 shares 2,145,198,524 shares
-------------------------------- --------------------- ---------------------
Mitsubishi Electric Corp.
stockholders' equity per
share 1,069.(19) yen 1,118.(83) yen
--------------------- ---------------------
Basic earnings per share
attributable to Mitsubishi
Electric Corp. stockholders 119.(19) yen 105.(65) yen
--------------------- ---------------------
Diluted earnings per share
attributable to Mitsubishi
Electric Corp. stockholders 119.(19) yen 105.(65) yen
--------------------- ---------------------
(Notes regarding the going concern assumption)
Not applicable
(Significant subsequent events)
Not applicable
Condensed Quarterly Consolidated Financial Statements
Condensed Quarterly Consolidated Statements of Profit or Loss
and Condensed Quarterly Consolidated Statements of Comprehensive
Income (Fourth Quarter, Fiscal 2019)
(Condensed Quarterly Consolidated Statements of Profit or
Loss)
(In millions of yen)
FY '18 FY '19
(Jan. 1, 2018 (Jan. 1, 2019
- -
Mar. 31, 2018) Mar. 31, 2019)
(A) % of (B) % of B - A B/A
total total (%)
---------- -------
Revenue 1,257,669 100.0 1,255,796 100.0 (1,873) 100
Cost of sales 883,096 70.2 886,620 70.6 3,524 100
Selling, general and
administrative expenses 279,166 22.2 280,241 22.3 1,075 100
Other profit (loss) (5,909) (0.5) 102 0.0 6,011 -
Operating profit 89,498 7.1 89,037 7.1 (461) 99
Financial income 1,364 0.1 1,287 0.1 (77) 94
Financial expenses 5,051 0.4 1,035 0.1 (4,016) 20
Share of profit of investments
accounted for using the
equity method 8,221 0.7 4,923 0.4 (3,298) 60
---------------------------------- ---------- ------- ---------- ------- -------- -----
Profit before income
taxes 94,032 7.5 94,212 7.5 180 100
Income taxes 20,242 1.6 23,950 1.9 3,708 118
---------- ------- ---------- ------- -------- -----
Net profit 73,790 5.9 70,262 5.6 (3,528) 95
---------- ------- ---------- ------- -------- -----
Net profit attributable
to:
Mitsubishi Electric Corp.
stockholders 71,685 5.7 67,829 5.4 (3,856) 95
Non-controlling interests 2,105 0.2 2,433 0.2 328 116
---------- ------- ---------- ------- -------- -----
(Condensed Quarterly Consolidated Statements of Comprehensive
Income)
(In millions of yen)
FY '18 (A) FY '19 (B) B - A
(Jan. 1, 2018 (Jan. 1, 2019
- -
Mar. 31, 2018) Mar. 31, 2019)
---------------- ----------------
Net profit 73,790 70,262 (3,528)
---------------- ---------------- --------
(Other comprehensive income
(loss),
net of tax)
Items that will not be reclassified
to
net profit
Changes in fair value of financial
assets measured at fair value
through other comprehensive
income (23,397) 5,134 28,531
------------------------------------------ ---------------- ---------------- --------
Remeasurements of defined
benefit plans 21,323 12,234 (9,089)
------------------------------------------ ---------------- ---------------- --------
Share of other comprehensive
income of investments accounted
for using the equity method (659) (531) 128
---------------- ---------------- --------
Subtotal (2,733) 16,837 19,570
---------------- ---------------- --------
Items that may be reclassified
to net profit
Exchange differences on translating
foreign operations (28,989) 6,459 35,448
------------------------------------------ ---------------- ---------------- --------
Net changes in the fair value
of cash flow hedges (74) (1) 73
------------------------------------------ ---------------- ---------------- --------
Share of other comprehensive
income of investments accounted
for using the equity method 789 (994) (1,783)
---------------- ---------------- --------
Subtotal (28,274) 5,464 33,738
---------------- ---------------- --------
Total other comprehensive
income (loss) (31,007) 22,301 53,308
---------------- ---------------- --------
Comprehensive income 42,783 92,563 49,780
---------------- ---------------- --------
Comprehensive income attributable
to:
Mitsubishi Electric Corp.
stockholders 43,136 89,045 45,909
Non-controlling interests (353) 3,518 3,871
---------------- ---------------- --------
Disclosures of Transition to IFRS
The Mitsubishi Electric Group has applied IFRS beginning with
the consolidated financial statements for the first quarter of the
current fiscal year. The most recent consolidated financial
statements prepared in accordance with U.S. GAAP are for the year
ended March 31, 2018. The date of transition to IFRS was April 1,
2017.
(1) Exemptions and exceptions in IFRS 1
IFRS 1 requires entities adopting IFRS for the first time to
retrospectively apply IFRS in principle; however, with regard to
certain items, it allows exemption from, or prohibits,
retrospective application of IFRS.
The company and its consolidated subsidiaries use the following
exemptions on retrospective application permitted by IFRS 1:
- Business combinations
The company and its consolidated subsidiaries elected not to
apply IFRS 3 Business Combinations retrospectively to past business
combinations that occurred on or before December 22, 2015.
Consequently, the amount of goodwill that arose from business
combinations that occurred on or before December 22, 2015 is
recorded at the carrying amount in accordance with U.S. GAAP.
Goodwill was tested for impairment at the transition date
irrespective of whether there was any indication of impairment.
- Exchange differences on translating foreign operations
The company and its consolidated subsidiaries elected to deem
the cumulative translation differences for foreign operations at
the transition date to be zero. Consequently, the cumulative
translation differences for foreign operations at the transition
date were reclassified from accumulated other comprehensive income
(loss) to retained earnings.
- Designation of financial instruments recognized before the
date of transition to IFRS
The company and its consolidated subsidiaries elected to
designate the classification of financial instruments on the basis
of the facts and circumstances that existed at the date of
transition to IFRS.
(2) Reconciliations
Reconciliations for which disclosures are required on first time
adoption of IFRS are as follows:
Items that do not affect retained earnings and comprehensive
income are presented in "Reclassification," and items that affect
retained earnings and comprehensive income are presented in
"Recognition and measurement differences."
Reconciliation of Equity as at the Date of Transition to IFRS
(April 1, 2017)
(Consolidated Statements of Financial Position) (In millions of
yen)
Presentation under U.S. GAAP Re-classification Recognition IFRS Presentation under
U.S. GAAP and measurement IFRS
differences
(Assets) (Assets)
Current assets 2,500,685 3,062 4,810 2,508,557 Current assets
Cash and cash Cash and cash
equivalents 662,469 662,469 equivalents
Trade receivables
Trade receivables 1,037,201 15,261 103,004 1,155,466 and contract assets
Inventories 643,040 (83,138) 559,902 Inventories
Prepaid expenses
and other current
assets 157,975 (12,199) (15,056) 130,720 Other current assets
(3,062) 60,950 1,729,473 Non-current assets
Long-term trade
receivables 2,815 (2,815)
Investments 618,935 (618,935)
Investments accounted
for using the equity
181,724 5,634 187,358 method
Other financial
362,869 27,710 390,579 assets
Net property, plant Property, plant and
and equipment 732,611 (33,133) 699,478 equipment
Other non-current
Other assets 317,224 74,095 60,739 452,058 assets
---------- ----------------- ---------------- ---------- ---------------------------
Total assets 4,172,270 65,760 4,238,030 Total assets
============================ ========== ================= ================ ========== ===========================
(In millions of yen)
Presentation under U.S. GAAP Re-classification Recognition IFRS Presentation under
U.S. GAAP and measurement IFRS
differences
(Liabilities) (Liabilities)
Current liabilities 1,525,761 7,456 33,082 1,566,299 Current liabilities
Bank loans and current
portion of long-term
debt 124,368 21,987 146,355 Bonds and borrowings
Trade payables 780,202 (145,119) 635,083 Trade payables
Other current Other current
liabilities 621,191 152,575 11,095 784,861 liabilities
(7,456) 6,423 504,768 Non-current liabilities
Long-term debt 227,756 227,756 Bonds and borrowings
Retirement and severance Retirement benefit
benefits 194,990 8,044 203,034 liabilities
Other non-current
Other fixed liabilities 83,055 (7,456) (1,621) 73,978 liabilities
--------- ----------------- ---------------- --------- ----------------------------
Total liabilities 2,031,562 39,505 2,071,067 Total liabilities
--------- ----------------- ---------------- --------- ----------------------------
(Equity) (Equity)
Mitsubishi Electric Mitsubishi Electric
Corp. shareholders' Corp. stockholders'
equity 2,039,627 28,536 2,068,163 equity
Common stock 175,820 175,820 Common stock
Capital surplus 212,530 (13,785) 198,745 Capital surplus
Retained earnings 1,654,557 (60,897) 1,593,660 Retained earnings
Accumulated other Accumulated other
comprehensive income comprehensive income
(loss) (2,052) 103,218 101,166 (loss)
Treasury stock at Treasury stock, at
cost (1,228) (1,228) cost
Noncontrolling interests 101,081 (2,281) 98,800 Non-controlling interests
--------- ----------------- ---------------- --------- ----------------------------
Total equity 2,140,708 26,255 2,166,963 Total equity
--------- ----------------- ---------------- --------- ----------------------------
Total liabilities Total liabilities
and equity 4,172,270 65,760 4,238,030 and equity
============================= ========= ================= ================ ========= ============================
Balance of Debt 352,124 21,987 374,111 Bonds and borrowings
Accumulated other Accumulated other
comprehensive income comprehensive income
(loss): (loss):
Foreign currency Exchange differences
translation on translating foreign
adjustments 18,535 (18,535) operations
Pension liability Remeasurements of
adjustments (156,993) 156,993 defined benefit plans
Financial assets
measured
at fair value through
Unrealized gains on other comprehensive
securities 136,352 (35,223) 101,129 income
Net changes in the
Unrealized gains on fair value of cash
derivative instruments 54 (17) 37 flow hedges
Reconciliation of Equity as at the End of the Previous Fiscal
Year (March 31, 2018)
(Consolidated Statements of Financial Position) (In millions of
yen)
Presentation under U.S. GAAP Re-classification Recognition IFRS Presentation under
U.S. GAAP and measurement IFRS
differences
(Assets) (Assets)
Current assets 2,606,493 (1,434) (22,324) 2,582,735 Current assets
Cash and cash Cash and cash
equivalents 599,199 599,199 equivalents
Trade receivables
Trade receivables 1,087,593 14,225 89,711 1,191,529 and contract assets
Inventories 741,782 (95,520) 646,262 Inventories
Prepaid expenses
and other current
assets 177,919 (15,659) (16,515) 145,745 Other current assets
1,434 63,345 1,722,845 Non-current assets
Long-term trade
receivables 1,965 (1,965)
Investments 614,295 (614,295)
Investments accounted
for using the equity
187,828 6,480 194,308 method
Other financial
335,474 27,697 363,171 assets
Net property, plant Property, plant and
and equipment 740,448 (16,191) 724,257 equipment
Other non-current
Other assets 301,358 94,392 45,359 441,109 assets
---------- ----------------- ---------------- ---------- ---------------------------
Total assets 4,264,559 41,021 4,305,580 Total assets
============================ ========== ================= ================ ========== ===========================
(In millions of yen)
Presentation under U.S. GAAP Re-classification Recognition IFRS Presentation under
U.S. GAAP and measurement IFRS
differences
(Liabilities) (Liabilities)
Current liabilities 1,471,367 8,586 8,296 1,488,249 Current liabilities
Bank loans and current
portion of long-term
debt 122,430 465 122,895 Bonds and borrowings
Trade payables 719,404 (139,838) 579,566 Trade payables
Other current Other current
liabilities 629,533 148,424 7,831 785,788 liabilities
(8,586) (349) 420,112 Non-current liabilities
Long-term debt 189,055 189,055 Bonds and borrowings
Retirement and severance Retirement benefit
benefits 171,017 503 171,520 liabilities
Other non-current
Other fixed liabilities 68,975 (8,586) (852) 59,537 liabilities
--------- ----------------- ---------------- --------- ----------------------------
Total liabilities 1,900,414 7,947 1,908,361 Total liabilities
--------- ----------------- ---------------- --------- ----------------------------
(Equity) (Equity)
Mitsubishi Electric Mitsubishi Electric
Corp. shareholders' Corp. stockholders'
equity 2,259,355 34,819 2,294,174 equity
Common stock 175,820 175,820 Common stock
Capital surplus 213,250 (13,808) 199,442 Capital surplus
Retained earnings 1,857,741 (46,393) 1,811,348 Retained earnings
Accumulated other Accumulated other
comprehensive income comprehensive income
(loss) 14,472 95,020 109,492 (loss)
Treasury stock at Treasury stock, at
cost (1,928) (1,928) cost
Noncontrolling interests 104,790 (1,745) 103,045 Non-controlling interests
--------- ----------------- ---------------- --------- ----------------------------
Total equity 2,364,145 33,074 2,397,219 Total equity
--------- ----------------- ---------------- --------- ----------------------------
Total liabilities Total liabilities
and equity 4,264,559 41,021 4,305,580 and equity
============================= ========= ================= ================ ========= ============================
Balance of Debt 311,485 465 311,950 Bonds and borrowings
Accumulated other Accumulated other
comprehensive income comprehensive income
(loss): (loss):
Foreign currency Exchange differences
translation on translating foreign
adjustments 34,149 (16,600) 17,549 operations
Pension liability Remeasurements of
adjustments (141,075) 141,075 defined benefit plans
Financial assets
measured
at fair value through
Unrealized gains on other comprehensive
securities 121,413 (29,461) 91,952 income
Unrealized gains (losses) Net changes in the
on derivative fair value of cash
instruments (15) 6 (9) flow hedges
Notes to reconciliation of equity
The principal effects of transition to IFRS in the
reconciliation of equity above are as follows:
(1) Reclassification
The main elements of reclassification are as follows:
(a) In accordance with the presentation provisions under IFRS,
other financial assets are presented separately.
(b) Part of trade receivables, prepaid expenses and other
current assets and other assets are reclassified based on the
definition and recognition criteria of IFRS.
(c) Part of trade payables, other current liabilities and other
fixed liabilities are reclassified based on the definition and
recognition criteria of IFRS.
(2) Recognition and measurement differences
The main elements of recognition and measurement differences are
as follows:
(a) Employee benefits
Under U.S. GAAP, actuarial gains and losses and past service
costs are deferred in accumulated other comprehensive income
(loss), subsequently amortized for a specified future period and
recognized in profit or loss. Current service costs, interest costs
and expected return on plan assets are recognized in profit or loss
for the consolidated fiscal year.
Under IFRS, defined benefit obligations and plan assets relating
to defined benefit corporate pension plans and lump-sum payment
plans are remeasured in accordance with IFRS requirements. Changes
resulting from remeasurement are recognized in accumulated other
comprehensive income (loss), and reclassified directly from
accumulated other comprehensive income (loss) to retained earnings,
not through profit or loss. Past service costs arising from plan
amendments are fully recognized immediately in profit or loss.
Current service costs are recognized in profit or loss. Interest
costs are recognized in profit or loss at the amount determined by
multiplying the net amount of the defined benefit obligation and
plan assets by the discount rate used to determine the present
value of the obligation.
(b) Equity instruments
Under U.S. GAAP, non-marketable equity instruments are
recognized at their cost. If fair value of financial assets has
decreased and the decrease is considered not to be temporary,
impairment loss is recognized for the amount of the cost of the
financial assets in excess of fair value. Gains or losses on the
sale of these financial assets are recognized in profit or
loss.
Under IFRS, all equity instruments are recognized at fair value
irrespective of whether there is an active market. Since it is
permitted to recognize changes in fair value in other comprehensive
income (loss), the company and its consolidated subsidiaries have
elected to recognize changes in fair value of equity instruments in
other comprehensive income (loss). Accordingly, impairment losses
and gains or losses on the sale of equity instruments recognized in
profit or loss under U.S. GAAP are recognized in other
comprehensive income as well.
(c) Income taxes
Under U.S. GAAP, tax expenses incurred by sellers are deferred
using the deferred method for differences arising from unrealized
profits and losses from intercompany transactions.
Under IFRS, a difference between the carrying amount and the
sale price of an asset sold is recognized as a future deductible
temporary difference based on the asset and liability method. A
deferred tax asset is recognized for the future deductible
temporary difference using purchaser's effective tax rate while
taking its recoverability into consideration.
Under U.S. GAAP, deferred tax liabilities for temporary
differences associated with investments in equity method investees
are recognized using tax rates applicable on the premise that the
temporary difference will be reversed at the time of sale of the
equity method investees even if a company intends to continue to
hold the investments. In principle, deferred tax liabilities are
recognized for the undistributed earnings of subsidiaries.
Under IFRS, deferred tax liabilities are in principle recognized
for all the taxable temporary differences using tax rates applied
when the taxable temporary differences reverse, such as when
receiving dividends or selling the investments. Deferred tax
liabilities are recognized for the taxable temporary differences
associated with investments in subsidiaries etc. which are probable
to reverse in the foreseeable future.
(d) Exchange differences on translating foreign operations
Cumulative exchange differences on translating foreign
operations are all deemed to be zero at the date of transition to
IFRS. Consequently, exchange differences on translating foreign
operations included in accumulated other comprehensive income as at
the transition date were fully reclassified to retained
earnings.
(e) Exclusion of equity method investees
Under U.S. GAAP, when an investee no longer qualifies as an
equity method investee, the difference between the sale price and
the carrying amount of the interest sold is recognized in profit or
loss. If an investor retains a residual interest, gains or losses
recognized in prior periods remain included in the carrying amount
of the residual interest.
Under IFRS, when an investee no longer qualifies as an equity
method investee, any residual interest is measured at fair value.
The difference between the sum of the sales price and the fair
value of the residual interest and the carrying amount of the
interest at the point when an investee no longer qualifies as an
equity method investee is recognized in profit or loss.
(f) Government grants
Under U.S. GAAP, government grants related to acquisition of
assets are not reflected in the carrying amounts of assets because
there are no accounting standards for such government grants.
Under IFRS, government grants related to assets are recognized
as deducting the carrying amount of the asset by the government
grants received.
(g) Impairment of non-financial assets
Under U.S. GAAP, if there is an indication that a non-current
asset may be impaired, the carrying amount and the undiscounted
estimated future cash flows of the asset is compared. If the
carrying amount exceeds the estimated future cash flows, any excess
of the carrying amount over the fair value is recognized as an
impairment loss.
Under IFRS, if there is an indication that a non-current asset
may be impaired, any excess of the carrying amount over the
recoverable amount of the non-current asset (the higher of value in
use or fair value less costs of disposal) is recognized as an
impairment loss of the non-current asset.
(h) Business combinations
Under U.S. GAAP, in business combinations, the acquirer measures
the acquiree as a whole (including non-controlling interests) at
fair value and goodwill is recognized including the portion of
goodwill attributable to the non-controlling interests.
Under IFRS, in business combinations, it is permitted to elect
to apply either of two methods: the acquirer measures the acquiree
as a whole (including non-controlling interests) at fair value and
goodwill is recognized including the portion of goodwill
attributable to the non-controlling interests; or non-controlling
interests are measured as a proportional interest in the fair value
of the acquiree's net identifiable assets and goodwill is
recognized only for the acquirer's share. The company elected the
method of measuring non-controlling interest as a proportional
interest in the fair value of the acquiree's net identifiable
assets and recognizing goodwill only for the acquirer's share.
Capital surplus is recognized when non-controlling interests are
additionally acquired after the date when control was obtained.
Reconciliation of Profit or Loss and Comprehensive Income for
the Previous Fiscal Year (from April 1, 2017 to March 31, 2018)
(Consolidated Statements of Profit or Loss) (In millions of
yen)
Presentation under U.S. GAAP Re-classification Recognition IFRS Presentation under
U.S. GAAP and measurement IFRS
differences
Net sales 4,431,198 13,226 4,444,424 Revenue
Cost of sales 3,030,902 59,547 3,090,449 Cost of sales
Selling, general
and administrative Selling, general and
expenses 1,061,778 729 (41,146) 1,021,361 administrative expenses
Loss on impairment
of
long-lived assets 19,881 (19,881)
(20,990) 15,820 (5,170) Other profit (loss)
---------- ----------------- ---------------- ---------- ---------------------------
Operating income 318,637 (1,838) 10,645 327,444 Operating profit
Other income 60,414
Interest and Dividends 8,611 23,637 (23,637) 8,611 Financial income
Equity in earnings
of affiliated
companies 22,261 (22,261)
Other 29,542 (29,542)
Other expenses 14,473
Interest 2,727 4,726 (657) 6,796 Financial expenses
Other 11,746 (11,746)
Share of profit of
investments accounted
for using the equity
22,261 1,686 23,947 method
---------- ----------------- ---------------- ---------- ---------------------------
Income before income Profit before income
taxes 364,578 (723) (10,649) 353,206 taxes
Income taxes 82,239 (723) 5,291 86,807 Income taxes
---------- ----------------- ---------------- ---------- ---------------------------
Net income 282,339 (15,940) 266,399 Net profit
---------- ----------------- ---------------- ---------- ---------------------------
Net profit attributable
to:
Net income attributable
to the noncontrolling Non-controlling
interests 10,459 185 10,644 interests
---------- ----------------- ----------------
Net income attributable
to Mitsubishi Electric Mitsubishi Electric
Corp. 271,880 (16,125) 255,755 Corp. stockholders
---------- ----------------- ---------------- ---------- ---------------------------
(Consolidated Statements of Comprehensive Income) (In millions
of yen)
Presentation under U.S. GAAP Re-classification Recognition IFRS Presentation under
U.S. GAAP and measurement IFRS
differences
Net income 282,339 (15,940) 266,399 Net profit
---------- ----------------- ---------------- -------- ----------------------------
Other comprehensive (Other comprehensive
income (loss), net income (loss), net
of tax of tax)
Items that will not
be reclassified to
net profit
Changes in fair value
of financial assets
measured at fair value
through other
Unrealized gains comprehensive
(losses) on securities (14,875) 392 14,431 (52) income
Pension liability Remeasurements of
adjustments 15,857 (596) 6,062 21,323 defined benefit plans
Share of other
comprehensive
income of investments
accounted for using
204 (34) 170 the equity method
----------------- ---------------- -------- ----------------------------
20,459 21,441 Subtotal
----------------- ---------------- -------- ----------------------------
Items that may be
reclassified to net
profit
Exchange differences
Foreign currency on translating foreign
translation adjustments 17,023 (1,908) 1,877 16,992 operations
Unrealized gains Net changes in the
(losses) on derivative fair value of cash
instruments (88) (6) 23 (71) flow hedges
Share of other
comprehensive
income of investments
accounted for using
1,914 (45) 1,869 the equity method
----------------- ---------------- -------- ----------------------------
1,855 18,790 Subtotal
---------- ----------------- ---------------- -------- ----------------------------
Total other comprehensive
Total 17,917 22,314 40,231 income
---------- ----------------- ---------------- -------- ----------------------------
Comprehensive income 300,256 6,374 306,630 Comprehensive income
---------- ----------------- ---------------- -------- ----------------------------
Comprehensive income
attributable to:
Comprehensive income
attributable to
the noncontrolling Non-controlling
interests 11,852 68 11,920 interests
---------- ----------------- ----------------
Comprehensive income
attributable to
Mitsubishi Electric Mitsubishi Electric
Corp. 288,404 6,306 294,710 Corp. stockholders
---------- ----------------- ---------------- -------- ----------------------------
Notes to Reconciliation of Profit or Loss and Comprehensive
Income
The principal effects of transition to IFRS in the
reconciliation of profit or loss and comprehensive income above are
as follows:
(1) Reclassification
The main elements of reclassification are as follows:
(a) In accordance with the presentation provisions under IFRS,
financial income and financial expenses are presented
separately.
(b) In accordance with the presentation provisions under IFRS,
part of other income and other expenses, etc. is included and
presented in operating profit.
(c) Unrealized gains (losses) on securities, pension liability
adjustments, foreign currency translation adjustments and
unrealized gains (losses) on derivative instruments in other
comprehensive income that are attributable to equity investees are
reclassified in accordance with the presentation provisions under
IFRS.
(2) Recognition and measurement differences
The main elements of recognition and measurement differences are
as follows:
(a) Reconciliation of revenue and cost of sales
Under U.S. GAAP, if progress of construction contracts cannot be
reliably estimated, all construction costs and construction revenue
are recognized when the construction is complete.
Under IFRS, revenue from a performance obligation satisfied over
time is only recognized for costs incurred to the extent that it is
probable that the cost will be recovered and costs are recognized
as expenses in the period in which they are incurred if the
progress cannot be reliably estimated.
(b) Equity instruments
Non-marketable equity instruments are recognized at their cost
under U.S. GAAP. If fair value of financial assets has decreased
and the decrease is considered not to be temporary, impairment loss
is recognized for the amount of the cost of the financial assets in
excess of fair value. Gains or losses on the sale of these
financial assets are recognized in profit or loss.
Under IFRS, on the other hand, equity instruments are recognized
at fair value irrespective of whether there is an active market.
Because it is permitted to recognize changes in fair value in other
comprehensive income, the company and its consolidated subsidiaries
have elected to recognize changes in fair value of equity
instruments in other comprehensive income. Accordingly, impairment
losses and gains or losses on the sale of equity instruments
recognized in profit or loss under U.S. GAAP are recognized in
other comprehensive income as well.
Notes to Reconciliation of Cash Flows
There are no significant differences in the statement of cash
flows resulting from transition from U.S. GAAP to IFRS.
Cautionary Statement
The Mitsubishi Electric Group (hereafter "the Group") is
involved in development, manufacture and sales in a wide range of
fields including Energy and Electric Systems, Industrial Automation
Systems, Information and Communication Systems, Electronic Devices
and Home Appliances, and these operations extend globally, not only
inside Japan, but also in North America, Europe, Asia and other
regions. While the statements herein are based on certain
assumptions and premises that the Group trusts and considers to be
reasonable under the circumstances on the date of announcement,
actual financial standings and operating results are subject to
change due to any of the factors as contemplated hereunder and/or
any additional factor unforeseeable as of the date of this
announcement. Such factors materially affecting the expectations
expressed herein shall include but are not limited to the
following:
(1) Important trends
The Group's operations may be affected by trends in the global
economy, social conditions, laws, tax codes and regulations.
(2) Foreign currency exchange rates
Fluctuations in foreign currency markets may affect the Group's
sales of exported products and purchases of imported materials that
are denominated in U.S. dollars or euros, as well as its Asian
production bases' sales of exported products and purchases of
imported materials that are denominated in foreign currencies.
(3) Stock markets
A fall in stock market prices may cause a decline in value of
the Group's marketable securities and pension assets.
(4) Supply/demand balance for products and procurement
conditions for materials and components
A decline in prices and shipments due to changes in the
supply/demand balance, as well as an increase in material prices
due to a worsening of material and component procurement
conditions, may adversely affect the Group's performance.
(5) Fund raising
An increase in interest rates, the yen interest rate in
particular, would increase the Group's interest expenses.
(6) Significant patent matters
Important patent filings, licensing, copyrights and
patent-related disputes may adversely affect related
businesses.
(7) Environmental legislation or relevant issues
The Group may incur losses or expenses owing to changes in
environmental legislation or the occurrence of environmental
issues. Such changes in legislation or the occurrence of
environmental issues may also impact manufacturing and all
corporate activities of the Group.
(8) Flaws or defects in products or services
The Group may incur losses or expenses resulting out of flaws or
defects in products or services, and the lowered reputation of the
quality of all its products and services may affect the entire
Group.
(9) Litigation and other legal proceedings
The Group's operations may be affected by lawsuits or other
legal proceedings against Mitsubishi Electric, its subsidiaries
and/or equity method associates.
(10) Disruptive changes
Disruptive changes in technology, development of products using
new technology, timing of production and market introduction may
adversely affect the Group's performance.
(11) Business restructuring
The Group may record losses due to restructuring measures.
(12) Information security
The performance of the Group may be affected by computer virus
infections, unauthorized access and other unpredictable incidents
that lead to the loss or leakage of personal information held by
the Group or confidential information regarding the Group's
business such as its technology, sales and other operations.
(13) Natural disasters
The Group's operations, particularly manufacturing activities,
may be affected by the occurrence of earthquakes, typhoons,
tsunami, fires and other large-scale disasters.
(14) Other significant factors
The Group's operations may be affected by the outbreak of social
or political upheaval due to terrorism, war, pandemic by new
strains of influenza and other diseases, or other factors.
http://www.rns-pdf.londonstockexchange.com/rns/2117X_1-2019-4-26.pdf
###
About Mitsubishi Electric Corporation
With nearly 100 years of experience in providing reliable,
high-quality products, Mitsubishi Electric Corporation (TOKYO:
6503) is a recognized world leader in the manufacture, marketing
and sales of electrical and electronic equipment used in
information processing and communications, space development and
satellite communications, consumer electronics, industrial
technology, energy, transportation and building equipment.
Embracing the spirit of its corporate statement, Changes for the
Better, and its environmental statement, Eco Changes, Mitsubishi
Electric endeavors to be a global, leading green company, enriching
society with technology. The company recorded a revenue of 4,519.9
billion yen (US$ 40.7 billion*) in the fiscal year ended March 31,
2019. For more information visit:
www.MitsubishiElectric.com
*At an exchange rate of 111 yen to the US dollar, the rate given
by the Tokyo Foreign Exchange Market on March 31, 2019
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
FR IFMITMBJTMPL
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April 26, 2019 02:00 ET (06:00 GMT)
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