FOR IMMEDIATE RELEASE
Contact:
Masahiro Nagayasu General Manager Investor Relations
+81-75-935-6140
ir@nidec.com
UNAUDITED INTERIM FINANCIAL STATEMENTS (IFRS)
(English Translation)
RESULTS FOR THE NINE MONTHS ENDED DECEMBER 31, 2016 FROM APRIL 1, 2016 TO DECEMBER 31, 2016
CONSOLIDATED
Released on January 24, 2017
NIDEC CORPORATIONStock Listings: Tokyo Stock Exchange
Head Office: Kyoto, Japan
Date of Filing of Japanese Quarterly Securities Report (Plan): February 13, 2017
Selected Consolidated Financial Performance Information for the Nine months Ended December 31, 2016 (IFRS) (unaudited)
Consolidated Results of Operations
Yen in millions
Nine months ended December 31 2016 2015
Net sales 868,228 895,353
Ratio of change from the same period of previous fiscal year (3.0)% -
Operating profit 106,197 90,286
Ratio of change from the same period of previous fiscal year 17.6% -
Profit before income taxes 107,771 92,467
Ratio of change from the same period of previous fiscal year 16.6% -
Profit attributable to owners of the parent 81,638 69,526
Ratio of change from the same period of previous fiscal year 17.4% -
Comprehensive income for the period 94,610 54,178
Ratio of change from the same period of previous fiscal year 74.6% -
Yen
Nine months ended December 31
2016
2015
Earnings per share attributable to owners of the parent -Basic
275.25
234.19
Earnings per share attributable to owners of the parent -Diluted
275.25
233.05
Note:
Earnings per share attributable to owners of the parent -Basic and earnings per share attributable to owners of the parent -Diluted are calculated based on profit attributable to owners of the parent.
Consolidated Financial Position
Yen in millions
December 31, 2016 March 31, 2016
Total assets 1,491,335 1,376,636
Total equity 842,314 771,369
Total equity attributable to owners of the parent 833,337 763,023 Ratio of total equity attributable to owners of the parent to total assets 55.9% 55.4%
Dividends (unaudited)
Year ending March 31, 2017 (target)
Yen
Year ended March 31, 2016 (actual)
Interim dividend per share
40.00
40.00
Year-end dividend per share
45.00
40.00
Annual dividend per share
85.00
80.00
Note: Revision of previously announced dividend targets during this reporting period: No
Forecast of Consolidated Financial Performance (for the fiscal year ending March 31, 2017)
Yen in millions
Inc./Dec. ratio of change from the previous fiscal
year
Net sales 1,200,000 1.8%
Operating profit 140,000 19.0%
Profit before income taxes 140,000 19.5%
Profit attributable to owners of the parent 105,000 16.7%
Earnings per share attributable to owners of the parent -Basic (Yen) 354.01
Note:
Revision of the previously announced financial performance forecast during this reporting period: Yes
Others
Changes in significant subsidiaries (changes in "specified subsidiaries" (tokutei kogaisha) accompanying changes in the scope of consolidation) during this period: None
Changes in accounting policies:
Changes due to revisions to accounting standards: None
Changes due to other reasons: None
Changes in accounting estimates: None
Number of shares issued (common stock)
Number of shares issued at the end of each period (including treasury stock): 298,142,234 shares at December 31, 2016
298,142,234 shares at March 31, 2016
Number of treasury stock at the end of each period: 1,543,676 shares at December 31, 2016
1,541,210 shares at March 31, 2016
Weighted-average number of shares issued at the beginning and end of each period: 296,599,932 shares for the nine months ended December 31, 2016
296,876,935 shares for the nine months ended December 31, 2015
NIDEC adopts International Financial Reporting Standards ("IFRS") for its consolidated financial statements from the first quarter of the fiscal year ending March 31, 2017. Accordingly, the consolidated financial statements for the previous fiscal year and condensed quarterly consolidated financial statements for the nine months ended December 31, 2015 are also presented in accordance with IFRS.
NIDEC finalized the provisional accounting treatment for the business combination in the three months ended September 30, 2016. Consolidated financial statements for the previous fiscal year and condensed quarterly consolidated financial statements for the nine months ended December 31, 2015 reflect the revision of the initially allocated amounts of acquisition price as NIDEC finalized the provisional accounting treatment for the business combination.
Investor presentation materials relating to our financial results for the nine months ended December 31, 2016 are expected to be published on our corporate website on January 24, 2017.
1. Operating and Financial Review and Prospects(1) Analysis of Operating Results
Overview of Business Environment for the Nine months ended December 31, 2016
The U.S. economy continued to expand moderately for the nine months ended December 31, 2016, and Donald J. Trump's electoral win to be the next President of the United States in November raised expectations for a fiscal stimulus package by the Trump Administration and for the future of the American economy. In addition,
a concurrent global stock market rally known as the "Trump rally" in major developed nations led to a slow economic recovery in Japan and Europe. On the other hand, close monitoring is required for the economic prospect of China and other emerging economies, which may be affected by the United States' trade policy, as well as for national elections slated for 2017 in Europe and Italian financial institutions' financial crisis, both of which may trigger a financial unrest in the continent.
Under such a business environment, NIDEC (Nidec Corporation and its consolidated subsidiaries) continued to pursue our targets for the fiscal year ending March 31, 2021 of consolidated net sales of ¥2 trillion and an operating profit ratio of 15% based on our mid-term strategic goal, "Vision 2020," and achieved in the nine months ended December 31, 2016 the highest nine-month operating profit, profit before income taxes and profit for the period in our history.
Consolidated Operating Results
Consolidated results are based on IFRS.
The exchange rates used for the preparation of the foregoing forecasts are US$1 = ¥110 and €1 = ¥117. The exchange rates between the relevant Asian currencies and the Japanese yen used for the preparation of the foregoing forecasts were determined assuming these exchange rates.
Changes in significant subsidiaries during this period
None
Changes in accounting policy or estimate
Condensed Quarterly Consolidated Statements of Financial Position
The date of transition to IFRS (April 1, 2015)
March 31, 2016
December 31, 2016
Increase or decrease
Amounts
%
Amounts
%
Amounts
%
Assets
Yen in millions
Yen in millions
Yen in millions
Yen in millions
Current assets
Cash and cash equivalents
269,902
305,942
314,813
8,871
Trade and other receivables
255,470
251,310
315,523
64,213
Other financial assets
262
2,010
5,241
3,231
Income tax receivables
1,551
2,063
2,756
693
Inventories
170,880
170,874
184,901
14,027
Other current assets
20,018
22,892
25,966
3,074
Total current assets
718,083
53.2
755,091
54.9
849,200
56.9
94,109
Non-current assets
Property, plant, and equipment
342,556
346,932
364,074
17,142
Goodwill
162,959
162,043
164,300
2,257
Intangible assets
83,931
77,049
74,811
(2,238)
Investments accounted for using the equity method
2,167
1,896
1,137
(759)
Other investments
21,507
15,998
19,276
3,278
Other financial assets
2,274
1,804
3,030
1,226
Deferred tax assets
10,749
11,545
10,718
(827)
Other non-current assets
5,646
4,278
4,789
511
Total non-current assets
631,789
46.8
621,545
45.1
642,135
43.1
20,590
Total assets
1,349,872
100.0
1,376,636
100.0
1,491,335
100.0
114,699
The date of transition to IFRS (April 1, 2015)
March 31, 2016
December 31, 2016
Increase or decrease
Amounts
%
Amounts
%
Amounts
%
Liabilities
Yen in millions
Yen in millions
Yen in millions
Yen in millions
Current liabilities
Short term borrowings
52,401
81,092
61,919
(19,173)
Long term debt due within one year
45,432
82,777
102,618
19,841
Trade and other payables
204,372
186,990
238,486
51,496
Other financial liabilities
2,941
3,192
4,436
1,244
Income tax payables
5,913
5,831
6,109
278
Provisions
18,583
18,886
16,448
(2,438)
Other current liabilities
31,151
40,891
45,531
4,640
Total current liabilities
360,793
26.7
419,659
30.5
475,547
31.9
55,888
Non-current liabilities
Long term debt
184,432
136,798
116,457
(20,341)
Other financial liabilities
569
1,029
931
(98)
Retirement benefit liabilities
19,834
19,488
19,665
177
Provisions
2,904
3,337
3,355
18
Deferred tax liabilities
23,467
22,641
30,963
8,322
Other non-current liabilities
3,126
2,315
2,103
(212)
Total non-current liabilities
234,332
17.4
185,608
13.5
173,474
11.6
(12,134)
Total liabilities
595,125
44.1
605,267
44.0
649,021
43.5
43,754
Equity
Common stock
77,071
5.7
87,784
6.4
87,784
5.9
-
Additional paid-in capital
107,732
8.0
118,341
8.6
118,336
7.9
(5)
Retained earnings
562,787
41.7
625,168
45.4
685,272
46.0
60,104
Other components of equity
(1,072)
(0.1)
(56,159)
(4.1)
(45,921)
(3.1)
10,238
Treasury stock
(27)
(0.0)
(12,111)
(0.9)
(12,134)
(0.8)
(23)
Total equity attributable to owners of the parent
746,491
55.3
763,023
55.4
833,337
55.9
70,314
Non-controlling interests
8,256
0.6
8,346
0.6
8,977
0.6
631
Total equity
754,747
55.9
771,369
56.0
842,314
56.5
70,945
Total liabilities and equity
1,349,872
100.0
1,376,636
100.0
1,491,335
100.0
114,699
Condensed Quarterly Consolidated Statements of Income
and Condensed Quarterly Consolidated Statements of Comprehensive Income
For the nine months ended December 31, 2015 and 2016 Condensed Quarterly Consolidated Statements of Income
Nine months ended December 31
Increase or decrease
2015
2016
Amounts
%
Amounts
%
Amounts
%
Net sales Cost of sales
Gross profit
Selling, general and administrative expenses Research and development expenses
Operating profit
Financial income Financial expenses Derivative gain
Foreign exchange differences
Equity in net income (loss) of associates Profit before income taxes
Income tax expenses Profit for the period
Profit attributable to: Owners of the parent
Non-controlling interests
Profit for the period
Yen in millions
895,353
(691,924)
100.0
(77.3)
Yen in millions
868,228
(658,992)
100.0
(75.9)
Yen in millions
(27,125)
32,932
(3.0)
(4.8)
203,429
22.7
209,236
24.1
5,807
2.9
(73,436)
(39,707)
(8.2)
(4.4)
(64,279)
(38,760)
(7.4)
(4.5)
9,157
947
(12.5)
(2.4)
90,286
10.1
106,197
12.2
15,911
17.6
1,307
(1,301)
161
2,010
4
0.1
(0.1)
0.0
0.2
0.0
2,276
(1,811)
1,246
405
(542)
0.3
(0.2)
0.1
0.1
(0.1)
969
(510)
1,085
(1,605)
(546)
74.1
39.2
673.9
(79.9)
-
92,467
10.3
107,771
12.4
15,304
16.6
(21,904)
(2.4)
(25,434)
(2.9)
(3,530)
16.1
70,563
7.9
82,337
9.5
11,774
16.7
69,526
1,037
7.8
0.1
81,638
699
9.4
0.1
12,112
(338)
17.4
(32.6)
70,563
7.9
82,337
9.5
11,774
16.7
Year ended March 31, 2016
Amounts
%
Yen in millions 1,178,290
(909,953)
100.0
(77.2)
268,337
22.8
(98,697)
(51,978)
(8.4)
(4.4)
117,662
10.0
1,913
(2,410)
151
(153)
1
0.2
(0.3)
0.0
(0.0)
0.0
117,164
9.9
(26,166)
(2.2)
90,998
7.7
89,945
1,053
7.6
0.1
90,998
7.7
Year ended March 31, 2016
Amounts
Yen in millions
90,998
(941)
(2,909)
(56,190)
326
(6)
(59,720)
31,278
30,983
295
31,278
Condensed Quarterly Consolidated Statements of Comprehensive Income
Nine months ended December 31
Increase or decrease
2015
2016
Amounts
Amounts
Amounts
%
Profit for the period
Other comprehensive income, net of taxation
Items that will not be reclassified to net profit or loss:
Remeasurement of defined benefit plans
Fair value movements on FVTOCI equity financial assets Items that may be reclassified to net profit or loss:
Foreign currency translation adjustments
Effective portion of net changes in fair value of cash flow hedges
Fair value movements on FVTOCI debt financial assets Other comprehensive income for the period, net of taxation Comprehensive income for the period
Comprehensive income attributable to: Owners of the parent
Non-controlling interests
Comprehensive income for the period
Yen in millions
70,563
Yen in millions
82,337
Yen in millions
11,774
16.7
8
(182)
(190)
-
(1,161)
2,367
3,528
-
(14,645)
9,896
24,541
-
(579)
194
773
-
(8)
(2)
6
-
(16,385)
12,273
28,658
-
54,178
94,610
40,432
74.6
53,513
94,069
40,556
75.8
665
541
(124)
(18.6)
54,178
94,610
40,432
74.6
For the three months ended December 31, 2015 and 2016
Condensed Quarterly Consolidated Statements of Income
Three months ended December 31
Increase or decrease
2015
2016
Amounts
%
Amounts
%
Amounts
%
Net sales Cost of sales
Gross profit
Selling, general and administrative expenses Research and development expenses
Operating profit
Financial income Financial expenses Derivative gain
Foreign exchange differences Equity in net loss of associates
Profit before income taxes Income tax expenses Profit for the period
Profit attributable to: Owners of the parent
Non-controlling interests
Profit for the period
Yen in millions
308,001
(238,560)
100.0
(77.5)
Yen in millions
304,198
(230,445)
100.0
(75.8)
Yen in millions
(3,803)
8,115
(1.2)
(3.4)
69,441
22.5
73,753
24.2
4,312
6.2
(24,472)
(14,286)
(7.9)
(4.6)
(23,402)
(13,158)
(7.7)
(4.3)
1,070
1,128
(4.4)
(7.9)
30,683
10.0
37,193
12.2
6,510
21.2
410
(406)
46
(412)
(1)
0.1
(0.1)
0.0
(0.2)
(0.0)
944
(653)
3,941
578
(525)
0.3
(0.2)
1.3
0.2
(0.2)
534
(247)
3,895
990
(524)
130.2
60.8
-
-
-
30,320
9.8
41,478
13.6
11,158
36.8
(7,176)
(2.3)
(9,657)
(3.1)
(2,481)
34.6
23,144
7.5
31,821
10.5
8,677
37.5
22,669
475
7.4
0.1
31,528
293
10.4
0.1
8,859
(182)
39.1
(38.3)
23,144
7.5
31,821
10.5
8,677
37.5
Condensed Quarterly Consolidated Statements of Comprehensive Income
Three months ended December 31
Increase or decrease
2015
2016
Amounts
Amounts
Amounts
%
Profit for the period
Other comprehensive income, net of taxation
Items that will not be reclassified to net profit or loss:
Remeasurement of defined benefit plans
Fair value movements on FVTOCI equity financial assets Items that may be reclassified to net profit or loss:
Foreign currency translation adjustments
Effective portion of net changes in fair value of cash flow hedges
Fair value movements on FVTOCI debt financial assets Other comprehensive income for the period, net of taxation Comprehensive income for the period
Comprehensive income attributable to: Owners of the parent
Non-controlling interests
Comprehensive income for the period
Yen in millions
23,144
Yen in millions
31,821
Yen in millions
8,677
37.5
80
(72)
(152)
-
675
2,022
1,347
199.6
140
86,754
86,614
-
62
73
11
17.7
4
(3)
(7)
-
961
88,774
87,813
-
24,105
120,595
96,490
400.3
23,513
119,780
96,267
409.4
592
815
223
37.7
24,105
120,595
96,490
400.3
Condensed Quarterly Consolidated Statements of Changes in Equity
Reporting entity
Nidec Corporation (the Company) is a corporation located in Japan, whose shares are listed on the Tokyo Stock Exchange. The registered address of headquarters and principal business offices are available on the Company's website (http://www.nidec.com/en-Global/).
Condensed Quarterly Consolidated Financial Statements as of December 31, 2016 consist of the Company and its consolidated subsidiaries (NIDEC), and shares of associates of NIDEC.
NIDEC mainly designs, develops, produces, and sells products as described below:
Small precision motors, which include spindle motors for hard disk drives, brushless motors, fan motors, vibration motors, brush motors and motor applications.
Automotive, appliance, commercial and industrial products, which includes automotive motors and components, home appliance, commercial and industrial motors and related products.
Machinery, which includes industrial robots, card readers, test systems, pressing machines and power transmission drives.
Electronic and optical components, which include switches, trimmer potentiometers, lens units and camera shutters.
Others, which include services.
Basis of Preparation
Compliance with International Financial Reporting Standards (IFRS)
The condensed quarterly consolidated financial statements of NIDEC have been prepared in accordance with IAS 34 "Interim Financial Reporting" pursuant to the provision of article 93 of Regulations for Quarterly Consolidated Financial Statements, as the Company meets the criteria of a "Designated IFRS Specified Company" defined under article 1-2 of the regulations.
NIDEC adopts IFRS for the first time this financial year (commencing on April 1, 2016 and ending on March 31, 2017), and so the annual consolidated financial statements for the year are the first ones prepared in conformity with IFRS. The date of transition of NIDEC to IFRS is April 1, 2015. Explanations of how the first time adoption of, and the transition to, IFRS have affected NIDEC's financial position, business results and cash flows are provided in "Note 6. First-Time Adoption of IFRS".
Basis of measurement
The condensed quarterly consolidated financial statements have been prepared on a historical cost basis, except for some assets and liabilities, including derivative and other financial instruments measured at fair value.
Presentation currency and level of rounding
The condensed quarterly consolidated financial statements are presented in Japanese Yen, which is also the Company's functional currency, and figures are rounded to the nearest million yen, except as otherwise indicated.
Early adoption of new IFRS standards
NIDEC has early adopted IFRS 9 "Financial instruments" (amended in July 2014).
Significant accounting policies
Significant accounting policies are applied to all periods mentioned in the condensed quarterly consolidated financial statements, including the consolidated statement of financial position on the transition date of IFRS.
Significant accounting policies are stated in notes to NIDEC's condensed quarterly consolidated financial statements for the three months ended June 30, 2016.
Significant accounting estimates, judgments and assumptions
The preparation of the condensed quarterly consolidated financial statements requires management of NIDEC to make estimates, judgments and assumptions that affect the reported amounts of assets, liabilities, income, expenses and disclosure of contingent assets and liabilities. Actual results may differ from those estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis, and the effects resulting from revisions of accounting estimates are recognized in the period in which the estimates are revised and in future periods affected by the revision.
Judgments and estimates accompanying significant risks that may cause material adjustments to the carrying amounts of assets and liabilities in the current and next fiscal years are the same as those for the condensed consolidated financial statements for the first quarter of the current fiscal year, covering the period from April 1, 2016 to June 30, 2016.
Business Combinations
Pursuant to IFRS 3 "Business Combinations," during the three months ended September 30, 2016, NIDEC completed its valuation of the assets acquired and the liabilities assumed upon the acquisition of KB Electronics, Inc. (merged into Nidec Motor Corporation in March 2016) Consolidated financial statements for the previous fiscal year and condensed quarterly consolidated financial statements for the nine months ended December 31, 2015 reflect the revision of the initially allocated amounts of acquisition price as NIDEC finalized the provisional accounting treatment for the business combination. NIDEC has been evaluating the fair values of the assets acquired and the liabilities assumed upon the acquisitions of companies in the nine months ended December 31, 2016. The assets and liabilities which are currently under evaluation have been recorded on NIDEC's consolidated statement of financial position based on preliminary management estimation as of December 31, 2016. These evaluations do not have material impacts on NIDEC's consolidated financial position, results of operations or liquidity.
6. First-Time Adoption of IFRS
NIDEC discloses the consolidated financial statements under IFRS for the first time for the fiscal year ending March 31, 2017. The latest consolidated financial statements under accounting principles generally accepted in the United States ("U.S. GAAP") were prepared for the fiscal year ended March 31, 2016 and the date of transition to IFRS is April 1, 2015.
Exemptions to retrospective application of IFRS
IFRS 1 stipulates that an entity adopting IFRS for the first time shall apply IFRS retrospectively to prior periods. However, IFRS 1 allows certain exemptions from the retrospective application of certain aspects of IFRS, and accordingly NIDEC has applied the following exemptions:
Business combinations:
IFRS 1 permits an entity not to apply IFRS 3 "Business Combinations" retrospectively to business combinations that occurred prior to the date of transition to IFRS. NIDEC elected to apply this exemption and did not apply IFRS 3 retrospectively to business combinations that occurred before the date of transition to IFRS. As a result, the goodwill recognized prior to the transition date is recorded based on the U.S. GAAP book value of the transition date. NIDEC performed an impairment test on goodwill at the date of transition to IFRS regardless of whether there was any indication that the goodwill may be impaired.
Use of fair value as deemed cost:
IFRS 1 permits an entity to measure items of property, plant and equipment, investment property or intangible assets at the date of transition to IFRS at its fair value and use that fair value as deemed cost at that date. NIDEC elected to use the fair value at the date of transition to IFRS as deemed cost at the date of transition to IFRS for certain items of property, plant and equipment. Further, NIDEC elected to use the cost model for items of property, plant and equipment and intangible assets under IFRS, thus the revaluation model is not applied.
Exchange differences on translating foreign operations:
IFRS 1 permits the cumulative amount of exchange differences on translating foreign operations to be deemed to be zero at the date of transition to IFRS. NIDEC elected to apply this exemption and deemed all cumulative exchange differences on translating foreign operations as zero at the date of transition to IFRS.
Reconciliations
Reconciliation of equity as of the date of transition to IFRS (April 1, 2015)
Recognition and
Yen in millions
U.S. GAAP U.S. GAAP Re-classification
measurement differences, etc.
IFRS Note IFRS
Assets Current assets
Cash and cash equivalents
269,902
-
-
269,902
Assets Current assets
Cash and cash equivalents
-
255,470
-
255,470
Trade and other receivables
Trade note receivable
15,221
(15,221)
-
-
Trade accounts receivable
222,396
(222,396)
-
-
-
262
-
262
D
Other financial assets
-
1,551
-
1,551
Income tax receivables
Inventories
170,874
-
6
170,880
Inventories
Other current assets
50,622
(30,180)
(424)
20,018
Other current assets
Total current assets
729,015
(10,514)
(418)
718,083
Total current assets
Non-current assets
-
342,122
434
342,556
Property, plant, and equipment
Land
47,427
(47,427)
-
-
Buildings
189,742
(189,742)
-
-
Machinery and equipment
430,019
(430,019)
-
-
Construction in progress
33,831
(33,831)
-
-
Accumulated depreciation
(358,897)
358,897
-
-
Goodwill
162,959
-
-
162,959
Goodwill
-
83,931
-
83,931
Intangible assets
-
2,167
-
2,167
Investments accounted for using the equity method
-
21,507
-
21,507
Other investments
Marketable securities and
other securities investments 21,516
(21,516)
-
-
Investments in and
advances to affiliated 2,167 companies
(2,167)
-
-
-
2,274
-
2,274
D
Other financial assets
-
13,869
(3,120)
10,749
B
Deferred tax assets
-
10,010
(4,364)
5,646
Other non-current assets
Other tangible assets 99,561
(99,561)
-
-
Total non-current assets 628,325
10,514
(7,050)
631,789
Total non-current assets
Total assets 1,357,340 - (7,468) 1,349,872 Total assets
U.S. GAAP U.S. GAAP Re-classification
Recognition and measurement
Yen in millions
IFRS Note IFRS
differences, etc.
Liabilities and equity Liabilities and equity
Liabilities Liabilities
Current liabilities Current liabilities
Short-term borrowings 52,401 - - 52,401 Short term borrowings
Current portion of
long-term debt 45,485 - (53) 45,432
Long term debt due within one year
Trade notes and
- 204,328 44 204,372 Trade and other payables
accounts payable
-
2,941
-
2,941
Other financial liabilities
-
5,855
58
5,913
Income tax payables
-
18,583
-
18,583
Provisions
Accrued expenses
33,375
(33,375)
-
-
Other current liabilities
36,689
(5,538)
-
31,151
Other current liabilities
Total current liabilities
362,948
(2,204)
49
360,793
Total current liabilities
194,998 (194,998) - -
Long term liabilities Non-current liabilities
Long-term debt
184,612
-
(180)
184,432
Long term debt
-
569
-
569
Other financial liabilities
-
19,565
269
19,834
A
Retirement benefit liabilities
Accrued pension and severance costs
19,576
(19,576)
-
-
-
2,904
-
2,904
Provisions
-
32,721
(9,254)
23,467
B
Deferred tax liabilities
-
3,126
-
3,126
Other non-current liabilities
Other long term liabilities
37,105
(37,105)
-
-
Total long term liabilities
241,293
2,204
(9,165)
234,332
Total non-current liabilities
Total liabilities
604,241
-
(9,116)
595,125
Total liabilities
Equity
Equity
Common stock
77,071
-
-
77,071
Common stock
Additional paid-in capital
105,459
-
2,273
107,732
Additional paid-in capital
Retained earnings
427,641
-
135,146
562,787
C
Retained earnings
-
134,828
(135,900)
(1,072)
A
Other components of equity
Accumulated other
comprehensive income 134,828 (134,828) - -C
Treasury stock (27) - - (27) Treasury stock
Total Nidec Corporation
shareholders' equity
Noncontrolling interests
8,127
- 129
8,256
owners of the parent
Non-controlling interests
Total equity
753,099
- 1,648
754,747
Total equity
Total liabilities and equity
1,357,340
- (7,468)
1,349,872
Total liabilities and equity
744,972 - 1,519 746,491
Total equity attributable to
Notes to reconciliation of equity as of the date of transition to IFRS (April 1, 2015)
The major items of the reconciliation of equity as of the date of transition to IFRS are as follows:
Retirement benefit liabilities
Under U.S. GAAP, the actuarial gain and loss, and prior service costs resulted from defined benefit plan or lump-sum indemnities which incurred during the fiscal year but not recognized as the same periodic pension cost are recognized as accumulated other comprehensive income (loss) by the amount after tax. The amount recognized as accumulated other comprehensive income (loss) is amortized into net periodic pension costs over the certain future periods.
Under IFRS, actuarial gain and loss are recognized in other comprehensive income by the amount after tax and the prior service costs are expensed as incurred. The actuarial gain and loss are transferred from other components of equity to retained earnings directly without going through net profit or loss.
As a result of the factors described above, the amount that was reclassified from accumulated other comprehensive income (loss) to a decrease in "Retained earnings" at the IFRS transition date was ¥2,844 million.
Deferred tax
Under U.S. GAAP, when taxes on intercompany profits arising from transfer of assets between entities within NIDEC were paid by sellers, the taxes were deferred as prepaid expenses (¥4,185 million). Under IFRS, however, these temporary differences are recognized as deferred tax assets using the purchasers' tax rates.
Temporary differences resulting from the transition to IFRS are recognized as additional deferred tax assets and liabilities.
Deferred tax assets and liabilities are offset if a legally enforceable right exists to offset current tax assets with current tax liabilities and the deferred taxes relate to income taxes levied by the same taxation authority on the same taxable entity.
As a result, deferred tax assets and liabilities (net) decreased by ¥6,134 million at the date of transition to IFRS.
Translation adjustment of foreign operations
As noted in (1) above, IFRS 1 permits the cumulative amount of exchange differences on translating foreign operations to be deemed to be zero at the date of transition to IFRS. NIDEC elected to apply this exemption and deemed all cumulative exchange differences on translating foreign operations as zero at the date of transition to IFRS. As a result, translation adjustments reclassified from accumulated other comprehensive income to "Retained earnings" was ¥131,332 million at the date of transition to IFRS.
Reclassification on the consolidated statement of financial position
Certain reclassifications have been made to consolidated statement of financial position to conform to provisions under IFRS. The major reclassifications on consolidated statement of financial position are as follows:
Under U.S. GAAP, deferred tax assets and deferred tax liabilities are presented as current assets/non-current assets and current liabilities/non-current liabilities. Under IFRS, as deferred tax assets and deferred tax liabilities are not allowed to be presented as current assets/current liabilities, all of them are reclassified to non-current assets/non-current liabilities.
Financial assets and financial liabilities are disclosed separately based on a provision for presentation under IFRS.
Reconciliation of equity as of December 31, 2015
U.S. GAAP U.S. GAAP Re-classification
Recognition and measurement differences, etc.
Yen in millions
IFRS Note IFRS
Assets Current assets
Cash and cash equivalents
324,931
-
-
324,931
Assets Current assets
Cash and cash equivalents
-
269,303
104
269,407
Trade and other receivables
Trade note receivable
21,827
(21,827)
-
-
Trade accounts receivable
230,017
(230,017)
-
-
-
336
-
336
D
Other financial assets
-
2,827
-
2,827
Income tax receivables
Inventories
186,360
-
165
186,525
Inventories
Other current assets
51,972
(32,195)
178
19,955
Other current assets
Total current assets
815,107
(11,573)
447
803,981
Total current assets
Non-current assets
-
358,822
599
359,421
Property, plant, and equipment
Land
47,903
(47,903)
-
-
Buildings
194,286
(194,286)
-
-
Machinery and equipment
464,419
(464,419)
-
-
Construction in progress
34,154
(34,154)
-
-
Accumulated depreciation
(381,940)
381,940
-
-
Goodwill
168,483
-
(985)
167,498
E
Goodwill
-
81,073
211
81,284
E
Intangible assets
-
1,937
-
1,937
Investments accounted for using the equity method
-
18,721
-
18,721
Other investments
Marketable securities and
18,727
other securities investments
(18,727)
-
-
Investments in and
advances to affiliated 1,937 companies
(1,937)
-
-
-
1,736
-
1,736
D
Other financial assets
-
14,694
(3,488)
11,206
B
Deferred tax assets
-
10,973
(4,446)
6,527
Other non-current assets
Other tangible assets 96,897
(96,897)
-
-
Total non-current assets 644,866
11,573
(8,109)
648,330
Total non-current assets
Total assets 1,459,973 - (7,662) 1,452,311 Total assets
U.S. GAAP U.S. GAAP Re-classification
Recognition and measurement differences, etc.
Yen in millions
IFRS Note IFRS
Liabilities and equity Liabilities and equity
Liabilities Liabilities
Current liabilities Current liabilities
Short-term borrowings 121,937 - - 121,937 Short term borrowings
Current portion of long-term debt
52,495 - (24) 52,471
Long term debt due within one year
Trade notes and
- 214,638 45 214,683 Trade and other payables
accounts payable
-
5,477
-
5,477
Other financial liabilities
-
6,243
-
6,243
Income tax payable
-
15,614
15
15,629
Provisions
Accrued expenses
32,652
(32,652)
-
-
Other current liabilities
46,149
(8,714)
376
37,811
Other current liabilities
Total current liabilities
456,423
(2,584)
412
454,251
Total current liabilities
203,190 (203,190) - -
Long term liabilities Non-current liabilities
Long-term debt
139,328
-
(105)
139,223
Long term debt
-
890
-
890
Other financial liabilities
-
19,140
653
19,793
A
Retirement benefit liabilities
Accrued pension and severance costs
19,151
(19,151)
-
-
-
2,920
68
2,988
Provisions
-
35,002
(9,333)
25,669
B
Deferred tax liabilities
-
3,121
-
3,121
Other non-current liabilities
Other long term liabilities
39,338
(39,338)
-
-
Total long term liabilities
197,817
2,584
(8,717)
191,684
Total non-current liabilities
Total liabilities
654,240
-
(8,305)
645,935
Total liabilities
Equity
Equity
Common stock
87,784
-
-
87,784
Common stock
Additional paid-in capital
116,108
-
2,283
118,391
Additional paid-in capital
Retained earnings
474,879
-
132,565
607,444
C
Retained earnings
-
118,407
(134,314)
(15,907)
A
Other components of equity
Accumulated other comprehensive income
118,407 (118,407) - - C
Treasury stock (39) - - (39) Treasury stock
Total Nidec Corporation
shareholders' equity
Noncontrolling interests
8,594
- 109
8,703
owners of the parent
Non-controlling interests
Total equity
805,733
- 643
806,376
Total equity
Total liabilities and equity
1,459,973
- (7,662)
1,452,311
Total liabilities and equity
797,139 - 534 797,673
Total equity attributable to
Notes to reconciliation of equity as of December 31, 2015
The major items of the reconciliation of equity as of December 31, 2015 are as follows:
Retirement benefit liabilities
Under U.S. GAAP, the actuarial gain and loss, and prior service costs resulted from defined benefit plan or lump-sum indemnities which incurred during the fiscal year but not recognized as the same periodic pension cost are recognized as accumulated other comprehensive income (loss) by the amount after tax. The amount recognized as accumulated other comprehensive income (loss) is amortized into net periodic pension costs over the certain future periods.
Under IFRS, actuarial gain and loss are recognized in other comprehensive income by the amount after tax and the prior service costs are expensed as incurred. The actuarial gain and loss are transferred from other components of equity to retained earnings directly without going through net profit or loss.
As a result of the factors described above, the amount that was reclassified from accumulated other comprehensive income (loss) to a decrease in "Retained earnings" as of December 31, 2015 was ¥2,791 million.
Deferred tax
Under U.S. GAAP, when taxes on intercompany profits arising from transfer of assets between entities within NIDEC were paid by sellers, the taxes were deferred as prepaid expenses (¥4,264 million). Under IFRS, however, these temporary differences are recognized as deferred tax assets using the purchasers' tax rates.
Temporary differences resulting from the transition to IFRS are recognized as additional deferred tax assets and liabilities.
Deferred tax assets and liabilities are offset if a legally enforceable right exists to offset current tax assets with current tax liabilities and the deferred taxes relate to income taxes levied by the same taxation authority on the same taxable entity.
As a result, deferred tax assets and liabilities (net) decreased by ¥5,845 million as of December 31, 2015.
Translation adjustment of foreign operations
As noted in (1) above, IFRS 1 permits the cumulative amount of exchange differences on translating foreign operations to be deemed to be zero at the date of transition to IFRS. NIDEC elected to apply this exemption and deemed all cumulative exchange differences on translating foreign operations as zero at the date of transition to IFRS. As a result, translation adjustments reclassified from accumulated other comprehensive income to "Retained earnings" was ¥131,332 million at the date of transition to IFRS.
Reclassification on the consolidated statement of financial position
Certain reclassifications have been made to consolidated statement of financial position to conform to provisions under IFRS. The major reclassifications on consolidated statement of financial position are as follows:
Under U.S. GAAP, deferred tax assets and deferred tax liabilities are presented as current assets/non-current assets and current liabilities/non-current liabilities. Under IFRS, as deferred tax assets and deferred tax liabilities are not allowed to be presented as current assets/current liabilities, all of them are reclassified to non-current assets/non-current liabilities.
Financial assets and financial liabilities are disclosed separately based on a provision for presentation under IFRS.
Retrospective adjustment on business combinations
During the six months ended September 30, 2016, NIDEC completed some of its valuation of the fair values of the assets acquired and the liabilities assumed upon the acquisition in the previous years. Accordingly, retrospective adjustments are included in "Recognition and measurement differences, etc."
Reconciliation of equity as of March 31, 2016
U.S. GAAP U.S. GAAP Re-classification
Recognition and measurement differences, etc.
IFRS Note IFRS
Yen in millions
Assets Current assets
Cash and cash equivalents
305,942
-
-
305,942
Assets Current assets
Cash and cash equivalents
-
251,209
101
251,310
Trade and other receivables
Trade note receivable
16,589
(16,589)
-
-
Trade accounts receivables
218,680
(218,680)
-
-
-
2,010
-
2,010
D
Other financial assets
-
2,063
-
2,063
Income tax receivables
Inventories
170,951
-
(77)
170,874
Inventories
Other current assets
53,150
(30,380)
122
22,892
Other current assets
Total current assets
765,312
(10,367)
146
755,091
Total current assets
Non-current assets
-
347,729
(797)
346,932
Property, plant, and equipment
Land
47,477
(47,477)
-
-
Buildings
190,362
(190,362)
-
-
Machinery and equipment
450,860
(450,860)
-
-
Construction in progress
33,340
(33,340)
-
-
Accumulated depreciation
(374,310)
374,310
-
-
Goodwill
162,963
-
(920)
162,043
E
Goodwill
-
76,859
190
77,049
E
Intangible assets
-
1,896
-
1,896
Investments accounted for using the equity method
-
15,998
-
15,998
Other investments
Marketable securities and
16,004
other securities investments
(16,004)
-
-
Investments in and
advances to affiliated 1,896 companies
(1,896)
-
-
-
1,804
-
1,804
D
Other financial assets
-
13,554
(2,009)
11,545
B
Deferred tax assets
-
8,724
(4,446)
4,278
Other non-current assets
Other tangible assets 90,568
(90,568)
-
-
Total non-current assets 619,160
10,367
(7,982)
621,545
Total non-current assets
Total assets 1,384,472 - (7,836) 1,376,636 Total assets
U.S. GAAP U.S. GAAP Re-classification
Recognition and measurement differences, etc.
IFRS Note IFRS
Yen in millions
Liabilities and equity Liabilities and equity
Liabilities Liabilities
Current liabilities Current liabilities
Short-term borrowings 81,092 - - 81,092 Short term borrowings
Current portion of long-term debt
82,796 - (19) 82,777
Long term debt due within one year
Trade notes and
- 186,946 44 186,990 Trade and other payables
accounts payable
-
3,192
-
3,192
Other financial liabilities
-
5,831
-
5,831
Income tax payable
-
18,886
-
18,886
Provisions
Accrued expenses
34,948
(34,948)
-
-
Other current liabilities
44,388
(3,832)
335
40,891
Other current liabilities
Total current liabilities
420,478
(1,179)
360
419,659
Total current liabilities
177,254 (177,254) - -
Long term liabilities Non-current liabilities
Long-term debt
136,894
-
(96)
136,798
Long term debt
-
1,029
-
1,029
Other financial liabilities
-
19,158
330
19,488
A
Retirement benefit liabilities
Accrued pension and severance costs
19,169
(19,169)
-
-
-
3,283
54
3,337
Provisions
-
29,989
(7,348)
22,641
B
Deferred tax liabilities
-
2,315
-
2,315
Other non-current liabilities
Other long term liabilities
35,426
(35,426)
-
-
Total long term liabilities
191,489
1,179
(7,060)
185,608
Total non-current liabilities
Total liabilities
611,967
-
(6,700)
605,267
Total liabilities
Equity
Equity
Common stock
87,784
-
-
87,784
Common stock
Additional paid-in capital
116,058
-
2,283
118,341
Additional paid-in capital
Retained earnings
495,761
-
129,407
625,168
C
Retained earnings
-
76,729
(132,888)
(56,159)
A
Other components of equity
Accumulated other comprehensive income
76,729 (76,729) - - C
Treasury stock (12,111) - - (12,111) Treasury stock
Total Nidec Corporation shareholders' equity
Noncontrolling interests
764,221
8,284
- (1,198)
- 62
763,023
8,346
Total equity attributable to owners of the parent
Non-controlling interests
Total equity
772,505
- (1,136)
771,369
Total equity
Total liabilities and equity
1,384,472
- (7,836)
1,376,636
Total liabilities and equity
Notes to reconciliation of equity as of March 31, 2016
The major items of the reconciliation of equity as of March 31,2016 are as follows:
Retirement benefit liabilities
Under U.S. GAAP, the actuarial gain and loss, and prior service costs resulted from defined benefit plan or lump-sum indemnities which incurred during the fiscal year but not recognized as the same periodic pension cost are recognized as accumulated other comprehensive income (loss) by the amount after tax. The amount recognized as accumulated other comprehensive income (loss) is amortized into net periodic pension costs over the certain future periods.
Under IFRS, actuarial gain and loss are recognized in other comprehensive income by the amount after tax and the prior service costs are expensed as incurred. The actuarial gain and loss are transferred from other components of equity to retained earnings directly without going through net profit or loss.
As a result of the factors described above, the amount that was reclassified from accumulated other comprehensive income (loss) to a decrease in "Retained earnings" as of March 31, 2016 was ¥3,847 million.
Deferred tax
Under U.S. GAAP, when taxes on intercompany profits arising from transfer of assets between entities within NIDEC were paid by sellers, the taxes were deferred as prepaid expenses (¥4,111 million). Under IFRS, however, these temporary differences are recognized as deferred tax assets using the purchasers' tax rates.
Temporary differences resulting from the transition to IFRS are recognized as additional deferred tax assets and liabilities.
Deferred tax assets and liabilities are offset if a legally enforceable right exists to offset current tax assets with current tax liabilities and the deferred taxes relate to income taxes levied by the same taxation authority on the same taxable entity.
As a result, deferred tax assets and liabilities (net) decreased by ¥5,635 million as of March 31, 2016.
Translation adjustment of foreign operations
As noted in (1) above, IFRS 1 permits the cumulative amount of exchange differences on translating foreign operations to be deemed to be zero at the date of transition to IFRS. NIDEC elected to apply this exemption and deemed all cumulative exchange differences on translating foreign operations as zero at the date of transition to IFRS. As a result, translation adjustments reclassified from accumulated other comprehensive income to "retained earnings" was ¥131,332 million at the date of transition to IFRS.
Reclassification on the consolidated statement of financial position
Certain reclassifications have been made to consolidated statement of financial position to conform to provisions under IFRS. The major reclassifications on consolidated statement of financial position are as follows:
Under U.S. GAAP, deferred tax assets and deferred tax liabilities are presented as current assets/non-current assets and current liabilities/non-current liabilities. Under IFRS, as deferred tax assets and deferred tax liabilities are not allowed to be presented as current assets/current liabilities, all of them are reclassified to non-current assets/non-current liabilities.
Financial assets and financial liabilities are disclosed separately based on a provision for presentation under IFRS.
Retrospective adjustment on business combinations
During the six months ended September 30, 2016, NIDEC completed some of its valuation of the fair values of the assets acquired and the liabilities assumed upon the acquisition in the previous years. Accordingly, retrospective adjustments are included in "Recognition and measurement differences, etc."
Reconciliation of income and comprehensive income for the nine months ended December 31, 2015
Recognition and
Yen in millions
U.S. GAAP U.S. GAAP Re-classification
measurement differences, etc.
IFRS Note IFRS
Condensed quarterly
Quarterly consolidated
Net sales
895,353
-
-
895,353
income
Net sales
Cost of products sold
(690,915)
(13)
(996)
(691,924)
A,D
Cost of sales
Gross profit
204,438
(13)
(996)
203,429
Gross profit
statement of income
consolidated statement of
Selling, general and administrative expenses Research and development
(70,741) (2,782) 87 (73,436) A
expenses
expenses
Operating income
93,990 (2,795)
(909)
90,286
Operating profit
- 2,253
(946)
1,307
C
Financial income
- (1,262)
(39)
(1,301)
C
Financial expenses
- 161
-
161
Derivative gain
- 2,010
-
2,010
Foreign exchange differences
- 4
-
4
Equity in net income (loss)
of associates
Interest and dividend income
1,303
(1,303)
- -
Interest expense
(1,164)
1,164
- -
(39,707) - - (39,707)
Selling, general and administrative expenses Research and development
Foreign exchange (loss) gain, net
Gain on marketable securities, net
2,010 (2,010) - -
946 (946) - - B
Other, net (2,728) 2,728 - -
Income before income tax
94,357
4
(1,894)
92,467
Profit before income taxes
Income taxes
(22,458)
-
554
(21,904)
Income tax expenses
Equity in net income of
4
(4)
-
-
affiliated companies
Consolidated net income
71,903
- (1,340)
70,563
Profit for the period
Net income attributable to:
Profit attributable to:
Nidec Corporation
70,928
- (1,402)
69,526
Owners of the parent
Noncontrolling interests
975
- 62
1,037
Non-controlling interests
U.S. GAAP U.S. GAAP Quarterly consolidated
statement of comprehensive income
Consolidated net income
Pension liability adjustments
Net unrealized gains and losses on securities
Foreign currency translation adjustments
Net gains and losses on derivative instruments
Re- classification
Recognition and measurement differences, etc.
Yen in millions
IFRS Note IFRS
Condensed quarterly consolidated statement of comprehensive income
71,903
-
(1,340)
70,563
78
-
(70)
8
A
(1,874)
8
705
(1,161)
B
(14,426)
-
(219)
(14,645)
(579)
-
-
(579)
-
(8)
-
(8)
(16,801)
-
416
(16,385)
55,102
-
(924)
54,178
54,507
-
(994)
53,513
595
-
70
665
Profit for the period
Remeasurement of defined benefit plans
Fair value movements on FVTOCI equity financial assets
Foreign currency translation adjustments Effective portion of net changes in fair value of cash flow hedges
Fair value movements on FVTOCI debt financial assets
Total other comprehensive income
Total comprehensive income
(Breakdown)
Comprehensive income (loss) attributable to Nidec Corporation Comprehensive income (loss) attributable to noncontrolling interests
Other comprehensive income for the period, net of taxation Comprehensive income for the period
Comprehensive income attributable to:
Owners of the parent
Non-controlling interests
Notes to reconciliation of income and comprehensive income for the nine months ended December 31, 2015
The major items of the reconciliation of income and comprehensive income for the nine months ended December 31, 2015 are as follows:
Retirement benefit liabilities
Under U.S. GAAP, the actuarial gain and loss, and prior service costs resulted from defined benefit plan or lump-sum indemnities which incurred during the fiscal year but not recognized as the same periodic pension cost are recognized as accumulated other comprehensive income (loss) by the amount after tax. The amount recognized as accumulated other comprehensive income (loss) is amortized into net periodic pension costs over the certain future periods.
Under IFRS, actuarial gain and loss are recognized in other comprehensive income by the amount after tax and the prior service costs are expensed as incurred. The actuarial gain and loss are transferred from other components of equity to retained earnings directly without going through net profit or loss.
As a result of the factors described above, retirement benefit costs have increased by ¥303 million on the condensed quarterly consolidated statement of income for the nine months ended December 31, 2015.
Equity financial assets
Under U.S. GAAP, gains and losses from the sales of investment securities and impairment of the securities are recognized through profit or loss. Under IFRS, however, NIDEC adopts IFRS 9 and accordingly any gain or loss arising from a difference between the carrying value and fair value of equity financial assets designated as measured at fair value through other comprehensive income ("FVTOCI equity financial assets") are recognized in other comprehensive income without reclassification.
Reclassifications on the consolidated statement of income
Certain reclassifications are made on the consolidated statement of income in order to comply with the IFRS provisions. The major reclassification on the condensed quarterly consolidated statement of income is as follows:
(a) Based on an IFRS provision concerning presentations, the financial income and financial expenses are presented separately.
Retrospective adjustment on business combinations
During the six months ended September 30, 2016, NIDEC completed some of its valuation of the fair values of the assets acquired and the liabilities assumed upon the acquisition in the previous years. Accordingly, retrospective adjustments are included in "Recognition and measurement differences, etc."
Reconciliation of income and comprehensive income for the three months ended December 31, 2015
Recognition and
Yen in millions
U.S. GAAP U.S. GAAP Re-classification
measurement differences, etc.
IFRS Note IFRS
Condensed quarterly
Quarterly consolidated
Net sales
308,001
-
-
308,001
income
Net sales
Cost of products sold
(237,857)
(7)
(696)
(238,560)
A,D
Cost of sales
Gross profit
70,144
(7)
(696)
69,441
Gross profit
statement of income
consolidated statement of
Selling, general and administrative expenses Research and development
(23,698) (847) 73 (24,472) A
expenses
expenses
Operating income
32,160 (854)
(623)
30,683
Operating profit
- 436
(26)
410
C
Financial income
- (408)
2
(406)
C
Financial expenses
- 46
-
46
Derivative gain
Foreign exchange
-
(412)
-
(412)
(14,286) - - (14,286)
Selling, general and administrative expenses Research and development
407
(407)
of associates
- -
(374)
374
- -
(412)
412
- -
- (1) - (1)
differences
Equity in net income (loss)
Interest and dividend income
Interest expense
Foreign exchange (loss) gain, net
Gain on marketable securities, net
26 (26) - - B
Other, net (839) 839 - -
Income before income tax
30,968
(1)
(647)
30,320
Profit before income taxes
Income taxes
(7,246)
-
70
(7,176)
Income tax expenses
Equity in net income of
(1)
1
-
-
affiliated companies
Consolidated net income
23,721
- (577)
23,144
Profit for the period
Net income attributable to:
Profit attributable to:
Nidec Corporation
23,320
- (651)
22,669
Owners of the parent
Noncontrolling interests
401
- 74
475
Non-controlling interests
U.S. GAAP U.S. GAAP Quarterly consolidated
statement of comprehensive income
Consolidated net income
Pension liability adjustments
Net unrealized gains and losses on securities
Foreign currency translation adjustments
Net gains and losses on derivative instruments
Re- classification
Recognition and measurement differences, etc.
Yen in millions
IFRS Note IFRS
Condensed quarterly consolidated statement of comprehensive income
23,721
-
(577)
23,144
101
-
(21)
80
A
510
(4)
169
675
B
115
-
25
140
62
-
-
62
-
4
-
4
788
-
173
961
24,509
-
(404)
24,105
23,999
-
(486)
23,513
510
-
82
592
Profit for the period
Remeasurement of defined benefit plans
Fair value movements on FVTOCI equity financial assets
Foreign currency translation adjustments Effective portion of net changes in fair value of cash flow hedges
Fair value movements on FVTOCI debt financial assets
Total other comprehensive income
Total comprehensive income
(Breakdown)
Comprehensive income (loss) attributable to Nidec Corporation Comprehensive income (loss) attributable to noncontrolling interests
Other comprehensive income for the period, net of taxation Comprehensive income for the period
Comprehensive income attributable to:
Owners of the parent
Non-controlling interests
Notes to reconciliation of income and comprehensive income for the three months ended December 31, 2015
The major items of the reconciliation of income and comprehensive income for the three months ended December 31, 2015 are as follows:
Retirement benefit liabilities
Under U.S. GAAP, the actuarial gain and loss, and prior service costs resulted from defined benefit plan or lump-sum indemnities which incurred during the fiscal year but not recognized as the same periodic pension cost are recognized as accumulated other comprehensive income (loss) by the amount after tax. The amount recognized as accumulated other comprehensive income (loss) is amortized into net periodic pension costs over the certain future periods.
Under IFRS, actuarial gain and loss are recognized in other comprehensive income by the amount after tax and the prior service costs are expensed as incurred. The actuarial gain and loss are transferred from other components of equity to retained earnings directly without going through net profit or loss.
As a result of the factors described above, retirement benefit costs have increased by ¥92 million on the condensed quarterly consolidated statement of income for the three months ended December 31, 2015.
Equity financial assets
Under U.S. GAAP, gains and losses from the sales of investment securities and impairment of the securities are recognized through profit or loss. Under IFRS, however, NIDEC adopts IFRS 9 and accordingly any gain or loss arising from a difference between the carrying value and fair value of equity financial assets designated as measured at fair value through other comprehensive income ("FVTOCI equity financial assets") are recognized in other comprehensive income without reclassification.
Reclassifications on the consolidated statement of income
Certain reclassifications are made on the consolidated statement of income in order to comply with the IFRS provisions. The major reclassification on the condensed quarterly consolidated statement of income is as follows:
(a) Based on an IFRS provision concerning presentations, the financial income and financial expenses are presented separately.
Retrospective adjustment on business combinations
During the six months ended September 30, 2016, NIDEC completed some of its valuation of the fair values of the assets acquired and the liabilities assumed upon the acquisition in the previous years. Accordingly, retrospective adjustments are included in "Recognition and measurement differences, etc."
Reconciliation of income and comprehensive income for the year ended March 31, 2016
Yen in millions
Recognition and
U.S. GAAP U.S. GAAP Re- measurement IFRS Note IFRS
differences, etc.
Consolidated statement of
Consolidated statement of
income
income
Net sales
1,178,290
-
-
1,178,290
Net sales
Cost of products sold
(908,311)
(131)
(1,511)
(909,953)
A,D
Cost of sales
Gross profit
269,979
(131)
(1,511)
268,337
Gross profit
Selling, general and administrative expenses
(93,463)
(5,580)
346
(98,697)
A
Selling, general and administrative expenses
Research and development
(51,978)
-
-
(51,978)
Research and development
expenses
expenses
Operating income
124,538 (5,711)
(1,165)
117,662
Operating profit
- 2,859
(946)
1,913
C
Financial income
- (2,356)
(54)
(2,410)
C
Financial expenses
- 151
-
151
Derivative gain
-
-
(153)
1
-
-
(153)
1
Foreign exchange differences
Equity in net income (loss)
classification
Interest and dividend income
1,913 (1,913) - -
of associates
Interest expense (2,228) 2,228 - -
Foreign exchange (loss)
gain, net
Gain on marketable securities, net
(153) 153 - -
946 (946) - - B
Other, net (5,688) 5,688 - -
Income before income tax
119,328
1
(2,165)
117,164
Profit before income taxes
Income taxes
(26,466)
-
300
(26,166)
Income tax expenses
Equity in net income of
1
(1)
-
-
affiliated companies
Consolidated net income
92,863
- (1,865)
90,998
Profit for the period
Net income attributable to:
Profit attributable to:
Nidec Corporation
91,810
- (1,865)
89,945
Owners of the parent
Noncontrolling interests
1,053
- -
1,053
Non-controlling interests
U.S. GAAP U.S. GAAP Consolidated statement of
comprehensive income Consolidated net income
Pension liability adjustments
Net unrealized gains and losses on securities
Foreign currency translation adjustments
Net gains and losses on derivative instruments
Total other comprehensive income
Total comprehensive income
(Breakdown) Comprehensive income
Re- classification
Recognition and measurement differences, etc.
Yen in millions
IFRS Note IFRS
Consolidated statement of comprehensive income
92,863
-
(1,865)
90,998
(981)
-
40
(941)
A
(3,714)
-
805
(2,909)
B
(54,491)
-
(1,699)
(56,190)
326
-
-
326
-
-
(6)
(6)
(58,860)
-
(860)
(59,720)
34,003
-
(2,725)
31,278
Profit for the period
Remeasurement of defined benefit plans
Fair value movements on FVTOCI equity financial assets
Foreign currency translation adjustments Effective portion of net changes in fair value of cash flow hedges
Fair value movements on FVTOCI debt financial assets
Other comprehensive income for the period, net of taxation Comprehensive income for the period
Comprehensive income attributable to:
(loss) attributable to Nidec Corporation Comprehensive income (loss) attributable to noncontrolling interests
33,711 - (2,728) 30,983 Owners of the parent
292 - 3 295 Non-controlling interests
Notes to reconciliation of income and comprehensive income for the year ended March 31, 2016
The major items of the reconciliation of income and comprehensive income for the year ended March 31, 2016 are as follows:
Retirement benefit liabilities
Under U.S. GAAP, the actuarial gain and loss, and prior service costs resulted from defined benefit plan or lump-sum indemnities which incurred during the fiscal year but not recognized as the same periodic pension cost are recognized as accumulated other comprehensive income (loss) by the amount after tax. The amount recognized as accumulated other comprehensive income (loss) is amortized into net periodic pension costs over the certain future periods.
Under IFRS, actuarial gain and loss are recognized in other comprehensive income by the amount after tax and the prior service costs are expensed as incurred. The actuarial gain and loss are transferred from other components of equity to retained earnings directly without going through net profit or loss.
As a result of the factors described above, retirement benefit costs have increased by ¥378 million on the consolidated statement of income for the year ended March 31, 2016.
Equity financial assets
Under U.S. GAAP, gains and losses from the sales of investment securities and impairment of the securities are recognized through profit or loss. Under IFRS, however, NIDEC adopts IFRS 9 and accordingly any gain or loss arising from a difference between the carrying value and fair value of equity financial assets designated as measured at fair value through other comprehensive income ("FVTOCI equity financial assets") are recognized in other comprehensive income without reclassification.
Reclassifications on the consolidated statement of income
Certain reclassifications are made on the consolidated statement of income in order to comply with the IFRS provisions. The major reclassification on the consolidated statement of income is as follows:
Based on an IFRS provision concerning presentations, the financial income and financial expenses are presented separately.
Retrospective adjustment on business combinations
During the six months ended September 30, 2016, NIDEC completed some of its valuation of the fair values of the assets acquired and the liabilities assumed upon the acquisition in the previous years. Accordingly, retrospective adjustments are included in "Recognition and measurement differences, etc."
Disclosure of material items of reconciliation of the consolidated statements of cash flows for the nine months ended December 31, 2015 and the year ended March 31, 2016
There are no material differences between the consolidated statement of cash flows presented under IFRS and the consolidated statement of cash flows presented under U.S. GAAP.
4. Supplementary Information
Quarterly Financial Data for the three months ended December 31, 2016, September 30, 2016 and June 30, 2016
Three months ended
June 30, 2016
September 30, 2016
December 31, 2016
Amounts
%
Amounts
%
Amounts
%
Net sales Operating profit
Profit before income taxes Profit for the period
Profit attributable to owners of the parent
Yen in millions
Yen in millions
Yen in millions
276,206
31,540
29,103
22,264
22,041
100.0
11.4
10.5
8.1
8.0
287,824
37,464
37,190
28,252
28,069
100.0
13.0
12.9
9.8
9.7
304,198
37,193
41,478
31,821
31,528
100.0
12.2
13.6
10.5
10.4
Information by Product Category
Product categories are classified based on similarities in product type, product attributes, and production and sales methods.
Major products of each product category:
Small precision motors: Spindle motors for HDDs, brushless motors, fan motors, vibration motors, brush motors and motor applications, etc.
Automotive, appliance, commercial and industrial products: Automotive motors and components, home appliance, commercial and industrial motors and related products.
Machinery: Industrial robots, card readers, test systems, pressing machines and power transmission drives, etc.
Electronic and optical components: Switches, trimmer potentiometers, lens units and camera shutters, etc.
Others: Services, etc.
NIDEC adopts IFRS for its consolidated financial statements from the fiscal year ending March 31, 2017 and previous period amounts are also presented in accordance with IFRS.
Sales by Geographic Segment
Yen in millions
Nine months ended December 31, 2015
Nine months ended December 31, 2016
Increase or decrease
Amounts
%
Amounts
%
Amounts
%
Japan
205,210
22.9%
208,669
24.0%
3,459
1.7%
U.S.A.
147,586
16.5%
138,065
15.9%
(9,521)
(6.5)%
Singapore
58,054
6.5%
44,612
5.2%
(13,442)
(23.2)%
Thailand
80,149
9.0%
77,489
8.9%
(2,660)
(3.3)%
Germany
64,485
7.2%
63,900
7.4%
(585)
(0.9)%
China
230,402
25.7%
219,043
25.2%
(11,359)
(4.9)%
Others
109,467
12.2%
116,450
13.4%
6,983
6.4%
Total
895,353
100.0%
868,228
100.0%
(27,125)
(3.0)%
Yen in millions
Three months ended December 31, 2015
Three months ended December 31, 2016
Increase or decrease
Amounts
%
Amounts
%
Amounts
%
Japan
65,141
21.1%
72,152
23.7%
7,011
10.8%
U.S.A.
43,940
14.3%
43,920
14.5%
(20)
0.0%
Singapore
20,429
6.6%
16,509
5.4%
(3,920)
(19.2)%
Thailand
27,986
9.1%
28,898
9.5%
912
3.3%
Germany
19,994
6.5%
19,503
6.4%
(491)
(2.5)%
China
90,689
29.4%
81,006
26.6%
(9,683)
(10.7)%
Others
39,822
13.0%
42,210
13.9%
2,388
6.0%
Total
308,001
100.0%
304,198
100.0%
(3,803)
(1.2)%
Note:
The sales are classified by domicile of the seller, and the figures exclude intra-segment transactions.
From the three months ended March 31, 2016, the sales by the Germany segment are separated from the Others segment as an individual segment whilst the sales by the Philippines segment are combined into the Others segment. Accordingly, previous period amounts have been reclassified.
Sales by Region
Yen in millions
Nine months ended December 31, 2015
Nine months ended December 31, 2016
Increase or decrease
Amounts
%
Amounts
%
Amounts
%
North America
171,020
19.1%
167,110
19.2%
(3,910)
(2.3)%
Asia
465,229
52.0%
437,907
50.4%
(27,322)
(5.9)%
Europe
112,438
12.5%
109,219
12.6%
(3,219)
(2.9)%
Others
9,717
1.1%
14,476
1.7%
4,759
49.0%
Overseas total
758,404
84.7%
728,712
83.9%
(29,692)
(3.9)%
Japan
136,949
15.3%
139,516
16.1%
2,567
1.9%
Total
895,353
100.0%
868,228
100.0%
(27,125)
(3.0)%
Yen in millions
Three months ended December 31, 2015
Three months ended December 31, 2016
Increase or decrease
Amounts
%
Amounts
%
Amounts
%
North America
53,294
17.3%
52,318
17.2%
(976)
(1.8)%
Asia
168,179
54.6%
161,641
53.2%
(6,538)
(3.9)%
Europe
38,289
12.4%
36,250
11.9%
(2,039)
(5.3)%
Others
3,650
1.2%
5,207
1.7%
1,557
42.7%
Overseas total
263,412
85.5%
255,416
84.0%
(7,996)
(3.0)%
Japan
44,589
14.5%
48,782
16.0%
4,193
9.4%
Total
308,001
100.0%
304,198
100.0%
(3,803)
(1.2)%
Note: The sales are classified by domicile of the buyer, and the figures exclude intra-segment transactions.
5. Other information (unaudited)
Summary of Consolidated Financial Performance
24 January, 2017
Nine months ended December 31, 2015
Increase or decrease
Nine months ended December 31, 2016
Three months ended December 31, 2015
Increase or decrease
Three months ended December 31, 2016
Net Sales
Yen in millions
895,353
%
(3.0)
Yen in millions
868,228
Yen in millions
308,001
%
(1.2)
Yen in millions
304,198
Operating profit
90,286
10.1%
17.6
106,197
12.2%
30,683
10.0%
21.2
37,193
12.2%
Profit before income taxes
92,467
10.3%
16.6
107,771
12.4%
30,320
9.8%
36.8
41,478
13.6%
Profit attributable to owners of the parent
69,526
7.8%
17.4
81,638
9.4%
22,669
7.4%
39.1
31,528
10.4%
Earnings per share attributable to owners of the parent -Basic
Yen
234.19
Yen
275.25
Yen 76.04
Yen
106.30
Earnings per share attributable to owners of the parent -Diluted
233.05
275.25
76.04
106.30
Summary of Consolidated Financial Position and Cash Flows
December 31, 2015
December 31, 2016
March 31, 2016
Total assets
Yen in millions
1,452,311
Yen in millions
1,491,335
Yen in millions
1,376,636
Total equity attributable to owners of the parent
797,673
833,337
763,023
Ratio of equity attributable to owners of the parent to total asset
%
54.9
%
55.9
%
55.4
Nine months ended December 31, 2015
Nine months ended December 31, 2016
Year ended March 31, 2016
Net cash provided by operating activities
Yen in millions
113,480
Yen in millions
102,996
Yen in millions
147,659
Net cash used in investing activities
(79,337)
(56,929)
(95,377)
Net cash provided by (used in) financing activities
27,773
(40,975)
7,775
Cash and cash equivalents at end of period
324,931
314,813
305,942
Dividends
Interim dividend per share
Year-end dividend per share
Annual dividend per share
Year ended March 31, 2016 (actual)
Yen
40.00
Yen
40.00
Yen
80.00
Year ending March 31, 2017 (actual)
40.00
-
-
Year ending March 31, 2017 (target)
-
45.00
85.00
Scope of Consolidation and Application of the Equity Method
NIDEC adopts IFRS for its consolidated financial statements from the first quarter of the fiscal year ending March 31, 2017. Accordingly, the consolidated financial statements for the previous fiscal year and condensed quarterly consolidated financial statements for the nine months ended December 31, 2015 are also in accordance with IFRS.
The amounts of percentage in "(1) Summary of Consolidated Financial Performance" represent percentage of sales.
Earnings per share attributable to owners of the parent - Basic and - Diluted are calculated based on profit attributable to owners of the parent.
NIDEC finalized the provisional accounting treatment for the business combination in the three months ended September 30, 2016.
NIDEC adopts International Financial Reporting Standards ("IFRS") for its consolidated financial statements instead of U.S. GAAP from the first quarter of the fiscal year ending March 31, 2017. Accordingly, the consolidated financial statements for the fiscal year ended March 31, 2016 are presented in accordance with IFRS for comparative analysis.
Consolidated Operating Results for the nine months ended December 31, 2016 ("this nine-month period")
Yen in millions
Nine months ended December 31, 2015 | Nine months ended December 31, 2016 | Increase or decrease | Increase or decrease ratio | |
Net sales | 895,353 | 868,228 | (27,125) | (3.0)% |
Operating profit | 90,286 | 106,197 | 15,911 | 17.6% |
Operating profit ratio | 10.1% | 12.2% | - | - |
Profit before income taxes | 92,467 | 107,771 | 15,304 | 16.6% |
Profit attributable to owners of the parent | 69,526 | 81,638 | 12,112 | 17.4% |
Consolidated net sales decreased 3.0% to ¥868,228 million for this nine-month period compared to the same period of the prior year due to a rapid appreciation of the Japanese yen. On the other hand, operating profit increased 17.6% to ¥106,197 million for this nine-month period compared to the same period of the prior year, achieving the highest operating profit for nine-month period in our history. The average exchange rate between the Japanese yen and the U.S. dollar for this nine-month period was ¥106.63 to the U.S. dollar, which reflected an appreciation of the Japanese yen against the U.S. dollar of approximately 12%, compared to the same period of the prior year. The average exchange rate between the Japanese yen and the Euro for this nine-month period was ¥118.02 to the Euro, which reflected an appreciation of the Japanese yen against the Euro of approximately 12% compared to the same period of the prior year. The fluctuations of the foreign currency exchange rates had a negative effect on our
net sales of approximately ¥101,000 million and our operating profit of approximately ¥15,700 million for this nine-month period compared to the same period of the prior year.
Profit before income taxes increased16.6% to ¥107,771 million for this nine-month period compared to the same period of the prior year and profit attributable to owners of the parent increased 17.4% to ¥81,638 million for this nine-month period compared to the same period of the prior year, respectively achieving the highest profit for nine-month period in our history.
Operating Results by Product Category for this nine-month period Compared to the same period of the prior year
Small precision motors-
Yen in millions
Nine months | Nine months | Increase or | Increase | ||
ended | ended | or | |||
December 31, | December 31, | decrease | decrease | ||
2015 | 2016 | ratio | |||
Net sales of small precision motors | 352,077 | 330,866 | (21,211) | (6.0)% | |
Hard disk drives spindle motors | 162,454 | 144,040 | (18,414) | (11.3)% | |
Other small precision motors | 189,623 | 186,826 | (2,797) | (1.5)% | |
Operating profit of small precision motors | 53,149 | 52,136 | (1,013) | (1.9)% | |
Operating profit ratio | 15.1% | 15.8% | - | - |
Net sales of small precision motors decreased 6.0% to ¥330,866 million for this nine-month period compared to the same period of the prior year. The fluctuations of the foreign currency exchange rates had a negative effect on our net sales of small precision motors of approximately ¥37,900 million for this nine-month period compared to the same period of the prior year.
Net sales of spindle motors for hard disk drives, or HDDs, for this nine-month period decreased 11.3% to
¥144,040 million compared to the same period of the prior year. Although the number of units sold of spindle motors for HDDs remained unchanged compared to the same period of the prior year, there were decreases in sales due to a negative effect of the foreign currency exchange rate fluctuations.
Net sales of other small precision motors for this nine-month period decreased 1.5% to ¥186,826 million compared to the same period of the prior year. This decrease was mainly due to decreases in sales of brushless DC motors and fan motors.
Operating profit of small precision motors decreased 1.9% to ¥52,136 million for this nine-month period compared to the same period of the prior year. The fluctuations of the foreign currency exchange rates had a negative effect on our operating profit of small precision motors of approximately ¥9,000 million for this nine-month period compared to the same period of the prior year.
Automotive, appliance, commercial and industrial products-
Yen in millions
Nine months ended December 31, 2015 | Nine months ended December 31, 2016 | Increase or decrease | Increase or decrease ratio | ||
Net sales of automotive, appliance, commercial and industrial products | 411,031 | 400,709 | (10,322) | (2.5)% | |
Appliance, commercial and industrial products | 208,082 | 209,904 | 1,822 | 0.9% | |
Automotive products | 202,949 | 190,805 | (12,144) | (6.0)% | |
Operating profit of automotive, appliance, commercial and industrial products | 31,607 | 42,173 | 10,566 | 33.4% | |
Operating profit ratio | 7.7% | 10.5% | - | - |
Net sales of automotive, appliance, commercial and industrial products decreased 2.5% to ¥400,709 million for this nine-month period compared to the same period of the prior year. The fluctuations of the foreign currency exchange rates had a negative effect on our net sales of automotive, appliance, commercial and industrial products of approximately ¥52,100 million for this nine-month period compared to the same period of the prior year.
Net sales of appliance, commercial and industrial products for this nine-month period increased 0.9% compared to the same period of the prior year. This increase was primarily due to the increase in sales through our "Three-new Strategy" (new products, new markets and new clients), although there was a negative effect of the foreign currency exchange rate fluctuations.
Net sales of automotive products for this nine-month period decreased 6.0% compared to the same period of the prior year due to a negative effect of the foreign currency exchange rate fluctuations, although there were increases in sales for automotive motors such as electric power steering motors and products of control valves at Nidec Tosok Corporation.
Operating profit of automotive, appliance, commercial and industrial products increased 33.4% to ¥42,173 million for this nine-month period compared to the same period of the prior year mainly due to cost reduction and changes in product mix. The fluctuations of the foreign currency exchange rates had a negative effect on our operating profit of automotive, appliance, commercial and industrial products of approximately ¥6,200 million for this nine-month period compared to the same period of the prior year.
Machinery-
Yen in millions
Nine months ended December 31, 2015 | Nine months ended December 31, 2016 | Increase or decrease | Increase or decrease ratio | |
Net sales of machinery | 80,245 | 86,610 | 6,365 | 7.9% |
Operating profit of machinery | 11,817 | 15,802 | 3,985 | 33.7% |
Operating profit ratio | 14.7% | 18.2% | - | - |
Net sales of machinery increased 7.9% to ¥86,610 million for this nine-month period compared to the same period of the prior year due to the contribution of the newly consolidated companies and the increases in sales of LCD panel or Organic EL handling robots at Nidec Sankyo Corporation, although there was a negative effect of the foreign currency exchange rate fluctuations.
Operating profit of machinery increased 33.7% to ¥15,802 million for this nine-month period compared to the same period of the prior year due to the contributions of the newly consolidated companies and the increase in sales of LCD panel or Organic EL handling robots.
Electronic and optical components-
Yen in millions
Nine months ended December 31, 2015 | Nine months ended December 31, 2016 | Increase or decrease | Increase or decrease ratio | |
Net sales of electronic and optical components | 49,264 | 47,307 | (1,957) | (4.0)% |
Operating profit of electronic and optical components | 4,545 | 7,782 | 3,237 | 71.2% |
Operating profit ratio | 9.2% | 16.4% | - | - |
Net sales of electronic and optical components decreased 4.0% to ¥47,307 million and operating profit of electronic and optical components increased 71.2% to ¥7,782 million for this nine-month period compared to the same period of the prior year.
Other products-
Yen in millions
Nine months ended December 31, 2015 | Nine months ended December 31, 2016 | Increase or decrease | Increase or decrease ratio | |
Net sales of other products | 2,736 | 2,736 | (0) | (0.0)% |
Operating profit of other products | 390 | 443 | 53 | 13.6% |
Operating profit ratio | 14.3% | 16.2% | - | - |
Net sales of other products was ¥2,736 million and operating profit of other products increased 13.6% to
¥443 million for this nine-month period compared to the same period of the prior year.
Consolidated Operating Results for the Three Months Ended December 31, 2016 ("this 3Q"), Compared to the Three Months Ended September 30, 2016 ("the previous 2Q")
Yen in millions
Three months ended September 30, 2016 | Three months ended December 31, 2016 | Increase or decrease | Increase or decrease ratio | |
Net sales | 287,824 | 304,198 | 16,374 | 5.7% |
Operating profit | 37,464 | 37,193 | (271) | (0.7)% |
Operating profit ratio | 13.0% | 12.2% | - | - |
Profit before income taxes | 37,190 | 41,478 | 4,288 | 11.5% |
Profit attributable to owners of the parent | 28,069 | 31,528 | 3,459 | 12.3% |
Consolidated net sales increased 5.7% to ¥304,198 million for this 3Q compared to the previous 2Q. Operating profit decreased 0.7% to ¥37,193 million for this 3Q compared to the previous 2Q.
The average exchange rate between the Japanese yen and the U.S. dollar for this 3Q was ¥109.30 to the U.S.
dollar, which reflected a depreciation of the Japanese yen against the U.S. dollar of approximately 7%, compared to the previous 2Q. The average exchange rate between the Japanese yen and the Euro for this 3Q was ¥117.78 to the
Euro, which reflected a depreciation of the Japanese yen against the Euro of approximately 3%, compared to the previous 2Q. The fluctuations of the foreign currency exchange rates had a positive effect on our net sales of approximately ¥12,400 million as well as on our operating profit of approximately ¥2,400 million for this 3Q compared to the previous 2Q.
Profit before income taxes increased 11.5% to ¥41,478 million for this 3Q compared to the previous 2Q and profit attributable to owners of the parent increased 12.3% to ¥31,528 million for this 3Q compared to the previous 2Q, respectively achieving the highest quarterly profit in our history.
Operating Results by Product Category for This 3Q Compared to The previous 2Q
Small precision motors-
Yen in millions
Three months | Three months | Increase or | Increase | ||
ended | ended | or | |||
September 30, | December 31, | decrease | decrease | ||
2016 | 2016 | ratio | |||
Net sales of small precision motors | 116,915 | 119,150 | 2,235 | 1.9% | |
Hard disk drives spindle motors | 47,567 | 53,674 | 6,107 | 12.8% | |
Other small precision motors | 69,348 | 65,476 | (3,872) | (5.6)% | |
Operating profit of small precision motors | 19,219 | 19,169 | (50) | (0.3)% | |
Operating profit ratio | 16.4% | 16.1% | - | - |
Net sales of small precision motors increased 1.9% to ¥119,150 million for this 3Q compared to the previous 2Q. The fluctuations of the foreign currency exchange rates had a positive effect on our net sales of small precision motors of approximately ¥5,300 million for this 3Q compared to the previous 2Q.
Net sales of spindle motors for HDDs increased 12.8% to ¥53,674 million for this 3Q compared to the previous 2Q. The number of units sold of spindle motors for HDDs for this 3Q increased approximately 4.5% compared to the previous 2Q.
Net sales of other small precision motors for this 3Q decreased 5.6% to ¥65,476 million compared to the previous 2Q. This decrease was due to decreases in sales of other small motors.
Operating profit of small precision motors slightly decreased to ¥19,169 million for this 3Q compared to the previous 2Q. The fluctuations of the foreign currency exchange rates had a positive effect on our operating profit of small precision motors of approximately ¥1,700 million for this 3Q compared to the previous 2Q.
Automotive, appliance, commercial and industrial products-
Yen in millions
Three months ended September 30, 2016 | Three months ended December 31, 2016 | Increase or decrease | Increase or decrease ratio | ||
Net sales of automotive, appliance, commercial and industrial products | 127,395 | 135,064 | 7,669 | 6.0% | |
Appliance, commercial and industrial products | 67,324 | 68,323 | 999 | 1.5% | |
Automotive products | 60,071 | 66,741 | 6,670 | 11.1% | |
Operating profit of automotive, appliance, commercial and industrial products | 14,158 | 14,185 | 27 | 0.2% | |
Operating profit ratio | 11.1% | 10.5% | - | - |
Net sales of automotive, appliance, commercial and industrial products increased 6.0% to ¥135,064 million for this 3Q compared to the previous 2Q. The fluctuations of the foreign currency exchange rates had a positive effect on our net sales of automotive, appliance, commercial and industrial products of approximately ¥5,700 million for this 3Q compared to the previous 2Q.
Net sales of appliance, commercial and industrial products for this 3Q increased 1.5% compared to the previous 2Q mainly due to the positive effect of the foreign currency exchange rate fluctuations.
Net sales of automotive products for this 3Q increased 11.1% compared to the previous 2Q. This increase was due to the positive effect of the foreign currency exchange rate fluctuations and increases in sales for automotive motors such as electric power steering motors.
Operating profit of automotive, appliance, commercial and industrial products increased 0.2% to ¥14,185 million for this 3Q compared to the previous 2Q mainly due to the increase in sales. The fluctuations of the foreign currency exchange rates had a positive effect on our operating profit of automotive, appliance, commercial and industrial products of approximately ¥500 million for this 3Q compared to the previous 2Q.
Machinery-
Yen in millions
Three months ended September 30, 2016 | Three months ended December 31, 2016 | Increase or decrease | Increase or decrease ratio | |
Net sales of machinery | 26,738 | 32,726 | 5,988 | 22.4% |
Operating profit of machinery | 5,305 | 5,602 | 297 | 5.6% |
Operating profit ratio | 19.8% | 17.1% | - | - |
Net sales of machinery increased 22.4% to ¥32,726 million for this 3Q compared to the previous 2Q due to the increase in sales of LCD panel handling robots at Nidec Sankyo Corporation.
Operating profit of machinery increased 5.6% to ¥5,602 million for this 3Q compared to the previous 2Q mainly due to increases in sales, despite a negative effect of changes in product mix.
Electronic and optical components-
Yen in millions
Three months ended September 30, 2016 | Three months ended December 31, 2016 | Increase or decrease | Increase or decrease ratio | |
Net sales of electronic and optical components | 15,871 | 16,275 | 404 | 2.5% |
Operating profit of electronic and optical components | 2,768 | 2,904 | 136 | 4.9% |
Operating profit ratio | 17.4% | 17.8% | - | - |
Net sales of electronic and optical components increased 2.5% to ¥16,275 million for this 3Q compared to the previous 2Q.
Operating profit of electronic and optical components increased 4.9% to ¥2,904 million for this 3Q compared to the previous 2Q.
Other products-
Yen in millions
Three months ended September 30, 2016 | Three months ended December 31, 2016 | Increase or decrease | Increase or decrease ratio | |
Net sales of other products | 905 | 983 | 78 | 8.6% |
Operating profit of other products | 153 | 156 | 3 | 2.0% |
Operating profit ratio | 16.9% | 15.9% | - | - |
Net sales of other products increased 8.6% to ¥983 million for this 3Q compared to the previous 2Q. Operating profit of other products increased 2.0% to ¥156 million for this 3Q compared to the previous 2Q.
(2) Financial Position
Yen in millions
As of March 31, 2016 | As of December 31, 2016 | Increase or decrease | |
Total assets | 1,376,636 | 1,491,335 | 114,699 |
Total liabilities | 605,267 | 649,021 | 43,754 |
Total equity attributable to owners of the parent | 763,023 | 833,337 | 70,314 |
Interest-bearing debt *1 | 300,667 | 280,994 | (19,673) |
Net interest-bearing debt *2 | (5,275) | (33,819) | (28,544) |
Debt ratio *3 | 21.8% | 18.8% | (3.0)% |
Debt to equity ratio ("D/E ratio") (times) *4 | 0.39 | 0.34 | (0.05) |
Net D/E ratio (times) *5 | (0.01) | (0.04) | (0.03) |
Ratio of total equity attributable to owners of the parent to | 55.4% | 55.9% | 0.5% |
total assets *6 |
Notes:
*1: The sum of "short term borrowings," "long term debt due within one year" and "long term debt" in our consolidated statement of financial position
*2: "Interest-bearing debt" less "cash and cash equivalents"
*3: "Interest-bearing debt" divided by "total assets"
*4: "Interest-bearing debt" divided by "total equity attributable to owners of the parent"
*5: "Net interest-bearing debt" divided by "total equity attributable to owners of the parent"
*6: "Total equity attributable to owners of the parent" divided by "total assets"
Total assets increased approximately ¥114,700 million to ¥1,491,335 million as of December 31, 2016 compared to March 31, 2016. This increase was mainly due to an increase of approximately ¥64,200 million in trade and other receivables, an increase of approximately ¥17,100 million in property, plant, and equipment and an increase of approximately ¥14,000 million in inventories.
Total liabilities increased approximately ¥43,800 million to ¥649,021 million as of December 31, 2016 compared to March 31, 2016. Our trade and other payables increased approximately ¥51,500 million. On the other hand, our interest-bearing debt decreased approximately ¥19,700 million. Specifically, our short term borrowings decreased approximately ¥19,200 million to approximately ¥61,900 million, our long term debt due within one year increased approximately ¥19,800 million to approximately ¥102,600 million, and our long term debt decreased approximately ¥20,300 million to approximately ¥116,500 million as of December 31, 2016 compared to March 31, 2016. The increase of ¥19,800 million in our long term debt due within one year was mainly attributable to a reclassification of approximately ¥65,000 million aggregate principal amount of first series unsecured bonds (ranking pari passu with the other series of unsecured straight bonds) (hereafter referred to as first series unsecured bonds) issued in November 2012 from non-current liability to current liability as the bonds matured within one year, despite a decrease of approximately ¥50,000 million due to the redemption of fourth series unsecured bonds (ranking pari passu with the other series of unsecured straight bonds) issued in December 2013. The decrease of ¥20,300 million in our long-term debt was mainly attributable to the reclassification of approximately ¥65,000 million aggregate principal amount of first series unsecured bonds from non-current liability to current liability, despite an increase of approximately ¥50,000 million due to the issue of fifth series unsecured bonds (ranking pari passu with the other series of unsecured straight bonds) in November 2016.
As a result, our net interest-bearing debt decreased to approximately negative ¥33,800 million as of December 31, 2016 from approximately negative ¥5,300 million as of March 31, 2016. Our debt ratio decreased to 18.8% as of December 31, 2016 from 21.8% as of March 31, 2016. Our D/E ratio decreased to 0.34 as of December
31, 2016 from 0.39 as of March 31, 2016. Our net D/E ratio improved to negative 0.04 as of December 31, 2016
compared to negative 0.01 as of March 31, 2016.
Total equity attributable to owners of the parent increased approximately ¥70,300 million to ¥833,337 million as of December 31, 2016 compared to March 31, 2016. Ratio of total equity attributable to owners of the parent to total assets increased to 55.9% as of December 31, 2016 from 55.4% as of March 31, 2016. The increase of ratio of total equity attributable to owners of the parent to total assets was mainly due to an increase in retained earnings of approximately ¥60,100 million as of December 31, 2016 compared to March 31, 2016, and an increase in other components of equity of approximately ¥10,200 million caused by exchange differences related to foreign operations.
Overview of Cash Flow-
Nine months ended December 31
2015 2016
Yen in millions Increase or decrease
Net cash provided by operating activities | 113,480 | 102,996 | (10,484) |
Net cash used in investing activities | (79,337) | (56,929) | 22,408 |
Free cash flow *1 | 34,143 | 46,067 | 11,924 |
Net cash provided by (used in) financing activities | 27,773 | (40,975) | (68,748) |
Note:
*1: Free cash flow is the sum of "net cash provided by operating activities" and "net cash used in investing activities."
Cash flows from operating activities for the nine months ended December 31, 2016 ("this nine-month period") were a net cash inflow of ¥102,996 million. Compared to the nine months ended December 31, 2015 ("the same period of the previous year"), our cash inflow from operating activities for this nine-month period decreased approximately ¥10,500 million. This decrease was mainly due to an increase of approximately ¥41,700 million in accounts receivable, although there were increases of approximately ¥31,300 million in account payable and approximately ¥11,800 million of profit for the period.
Cash flows from investing activities for this nine-month period were a net cash outflow of ¥56,929 million. Compared to the same period of the previous year, our net cash outflow from investing activities for this nine-month period decreased approximately ¥22,400 million mainly due to decreases in additions to property, plant and equipment of approximately ¥19,400 million.
As a result, we had a positive free cash flow of ¥46,067 million for this nine-month period, an increase of approximately ¥11,900 million compared to a positive free cash flow of ¥34,143 million for the same period of the previous year.
Cash flows from financing activities for this nine-month period were a net cash outflow of ¥40,975 million. Compared to the same period of the previous year, our net cash outflow from financing activities for this nine-month period increased approximately ¥68,700 million mainly due to an increase in net cash outflow from short term borrowings of approximately ¥84,300 million and outflow from redemption of corporate bonds of approximately
¥50,000 million. On the other hand, inflow from proceeds from issuance of corporate bonds increased of approximately ¥50,000 million and outflow form repayments of long term debt decreased approximately ¥21,400 million.
As a result of the foregoing and the impact of foreign exchange fluctuations of approximately positive
¥3,800 million, the balance of cash and cash equivalents as of December 31, 2016 was ¥314,813 million, an increase of approximately ¥8,900 million from March 31, 2016.
(3) Business Forecasts for the Fiscal Year ending March 31, 2017
Regarding global economic trends, we expect that, while a continuous economic recovery driven by fiscal policy of the United States is anticipated, close monitoring is required for the economic prospect of China and other emerging economies, which may be affected by the United States' trade policy, as well as for national elections slated for 2017 in Europe and Italian financial institutions' financial crisis, both of which may trigger a financial unrest in the continent.
We are revising our business performance forecast as follows since our sales and profits for the nine months ended December 31, 2016 are more than our expectations underlying our previous forecast. Also, in light of the recent depreciation of the Japanese yen, the average exchange rates used for the below forecasts are reset at ¥110 from previous ¥100 for US$1 and ¥117 from previous ¥110 for €1.
Forecast of consolidated results for the fiscal year ending March 31, 2017
Net sales Operating profit | ¥1,200,000 million ¥140,000 million | (Up 1.8% from the previous fiscal year) (Up 19.0% from the previous fiscal year) |
Profit before income taxes Profit attributable to owners of the parent | ¥140,000 million ¥105,000 million | (Up 19.5% from the previous fiscal year) (Up 16.7% from the previous fiscal year) |
Note:
Cautionary Note Regarding Forward-Looking Statements
This report contains forward-looking statements based on the current expectations, assumptions, estimates and projections of the Nidec Group in light of the information currently available to it. The Nidec Group cannot make any assurances that the expectations expressed in these forward-looking statements will prove to be correct. Actual results could be materially different from and worse than the Nidec Group's expectations as a result of various factors.
Percentage changes from the previous fiscal year are calculated by the previous year amounts which have been reflected the revision of the initially allocated amounts of acquisition price as NIDEC finalized the provisional accounting treatment for the business combination in the three months ended September 30, 2016.
2. OthersNone
3. Condensed Quarterly Consolidated Financial StatementsNine months ended December 31, 2015
Total equity attributable to owners of the parent | Non- controlling interests | Total equity | ||||||
Common Stock | Additional paid-in capital | Retained earnings | Other components of equity | Treasury stock | Total | |||
As of April 1, 2015 | Yen in millions 77,071 | Yen in millions 107,732 | Yen in millions 562,787 69,526 | Yen in millions | Yen in millions | Yen in millions | Yen in millions 8,256 1,037 (372) | Yen in millions |
(1,072) | (27) | 746,491 | 754,747 | |||||
Comprehensive income | ||||||||
Profit for the period | 69,526 | 70,563 | ||||||
Other comprehensive income | (16,013) | (16,013) | (16,385) | |||||
Total comprehensive income | 10,713 | 10,620 | (23,690) | 1,179 | (34) | 53,513 | 665 | 54,178 |
Transactions with owners directly | (34) | - | (34) | |||||
recognized in equity: | ||||||||
Purchase of treasury stock | ||||||||
Conversion of convertible bonds | 23 | 21,356 | - | 21,356 | ||||
Dividends paid to the owners of the parent | (23,690) | - | (23,690) | |||||
Dividends paid to non-controlling interests | - | (67) | (67) | |||||
Transfer to retained earnings | (1,179) | - | - | - | ||||
Other | 39 | (1) | (1) | 37 | (151) | (114) | ||
As of December 31, 2015 | 87,784 | 118,391 | 607,444 | (15,907) | (39) | 797,673 | 8,703 | 806,376 |
Nine months ended December 31, 2016
Total equity attributable to owners of the parent | Non- controlling interests | Total equity | ||||||
Common Stock | Additional paid-in capital | Retained earnings | Other components of equity | Treasury stock | Total | |||
As of April 1, 2016 | Yen in millions 87,784 | Yen in millions 118,341 | Yen in millions 625,168 81,638 | Yen in millions (56,159) 12,431 | Yen in millions | Yen in millions | Yen in millions 8,346 699 (158) | Yen in millions |
(12,111) | 763,023 | 771,369 | ||||||
Comprehensive income | ||||||||
Profit for the period | 81,638 | 82,337 | ||||||
Other comprehensive income | 12,431 | 12,273 | ||||||
Total comprehensive income | (5) | (23,728) | (2,194) | (23) | 94,069 | 541 | 94,610 | |
Transactions with owners directly | (23) | - | (23) | |||||
recognized in equity: | ||||||||
Purchase of treasury stock | ||||||||
Dividends paid to the owners of the parent | (23,728) | - | (23,728) | |||||
Dividends paid to non-controlling interests | - | (18) | (18) | |||||
Transfer to retained earnings | 2,194 | - | - | - | ||||
Other | 1 | (4) | 108 | 104 | ||||
As of December 31, 2016 | 87,784 | 118,336 | 685,272 | (45,921) | (12,134) | 833,337 | 8,977 | 842,314 |
(4) Condensed Quarterly Consolidated Statements of Cash Flows
Yen in millions | |||
Nine months ended December 31 | Increase or decrease | ||
2015 | 2016 | ||
Cash flows from operating activities: Profit for the period Adjustments to reconcile profit for the period to net cash provided by operating activities Depreciation and amortization Gain from sales, disposal or impairment of property, plant and equipment Financial (income) loss Equity in net (income) loss of associates Deferred income taxes Current income taxes Foreign currency adjustments (Decrease) increase in retirement benefit liability Increase in accounts receivable Increase in inventories Increase (decrease) in accounts payable Other, net Interests and dividends received Interests paid Income taxes paid | 70,563 | 82,337 | 11,774 |
50,651 | 44,368 | (6,283) | |
(355) | (1,263) | (908) | |
(50) | (504) | (454) | |
(4) | 542 | 546 | |
3,850 | 5,933 | 2,083 | |
18,054 | 19,501 | 1,447 | |
983 | (346) | (1,329) | |
(111) | 283 | 394 | |
(12,710) | (54,456) | (41,746) | |
(13,971) | (11,834) | 2,137 | |
10,837 | 42,103 | 31,266 | |
4,625 | (3,904) | (8,529) | |
1,333 | 2,064 | 731 | |
(1,196) | (1,846) | (650) | |
(19,019) | (19,982) | (963) | |
Net cash provided by operating activities | 113,480 | 102,996 | (10,484) |
Cash flows from investing activities: | (66,856) | (47,505) | 19,351 |
Additions to property, plant and equipment | |||
Proceeds from sales of property, plant and equipment | 1,184 | 1,423 | 239 |
Proceeds from sales or redemption of marketable securities | 1,313 | 224 | (1,089) |
Acquisitions of business, net of cash acquired | (9,711) | (5,703) | 4,008 |
Other, net | (5,267) | (5,368) | (101) |
Net cash used in investing activities | (79,337) | (56,929) | 22,408 |
Cash flows from financing activities: | 69,182 | (15,148) | (84,330) |
Increase (decrease) in short term borrowings | |||
Repayments of long term debt | (23,818) | (2,404) | 21,414 |
Proceeds from issuance of corporate bonds | - | 50,001 | 50,001 |
Redemption of corporate bonds | - | (50,000) | (50,000) |
Purchase of treasury stock | (34) | (23) | 11 |
Dividends paid to the owner of the parent | (23,690) | (23,728) | (38) |
Other, net | 6,133 | 327 | (5,806) |
Net cash provided by (used in) financing activities | 27,773 | (40,975) | (68,748) |
Effect of exchange rate changes on cash and cash equivalents | (6,887) | 3,779 | 10,666 |
Net increase in cash and cash equivalents | 55,029 | 8,871 | (46,158) |
Cash and cash equivalents at beginning of period | 269,902 | 305,942 | 36,040 |
Cash and cash equivalents at end of period | 324,931 | 314,813 | (10,118) |
Yen in millions |
Year ended March 31 |
2016 |
90,998 64,950 (155) 420 (1) 2,148 24,019 (368) 217 (5,163) (6,176) (6,897) 8,028 1,904 (1,797) (24,468) |
147,659 |
(81,898) 1,417 1,319 (9,665) (6,550) |
(95,377) |
32,412 (26,210) - - (12,133) (23,690) 37,396 |
7,775 |
(24,017) |
36,040 |
269,902 |
305,942 |
(5) Notes to Condensed Quarterly Consolidated Financial Statements
Notes Regarding Going Concern Assumption
Not applicable.
Notes to Condensed Quarterly Consolidated Financial Statements
The reconciliations required to be disclosed in the first IFRS financial statements are described in the reconciliations below.
"Re-classification" includes items that do not affect retained earnings and comprehensive income, while "Recognition and measurement, etc." includes items that affect retained earnings and comprehensive income.
Nine months ended December 31, 2015 Yen in millions
Small precision motors | Automotive, appliance, commercial and industrial products | Machinery | Electronic and optical components | Others | Total | Eliminations/ Corporate | Consolidated | |
Net sales: | 352,077 | 411,031 | 80,245 | 49,264 | 2,736 | 895,353 | - | 895,353 |
Exteral sales | ||||||||
Intersegment | 1,896 | 3,879 | 9,815 | 3,697 | 1,268 | 20,555 | (20,555) | - |
Total | 353,973 | 414,910 | 90,060 | 52,961 | 4,004 | 915,908 | (20,555) | 895,353 |
Operating expenses | 300,824 | 383,303 | 78,243 | 48,416 | 3,614 | 814,400 | (9,333) | 805,067 |
Operating profit | 53,149 | 31,607 | 11,817 | 4,545 | 390 | 101,508 | (11,222) | 90,286 |
Nine months ended December 31, 2016 Yen in millions
Small precision motors | Automotive, appliance, commercial and industrial products | Machinery | Electronic and optical components | Others | Total | Eliminations/ Corporate | Consolidated | |
Net sales: | 330,866 | 400,709 | 86,610 | 47,307 | 2,736 | 868,228 | - | 868,228 |
Exteral sales | ||||||||
Intersegment | 1,754 | 4,302 | 6,419 | 4,296 | 1,095 | 17,866 | (17,866) | - |
Total | 332,620 | 405,011 | 93,029 | 51,603 | 3,831 | 886,094 | (17,866) | 868,228 |
Operating expenses | 280,484 | 362,838 | 77,227 | 43,821 | 3,388 | 767,758 | (5,727) | 762,031 |
Operating profit | 52,136 | 42,173 | 15,802 | 7,782 | 443 | 118,336 | (12,139) | 106,197 |
Three months ended December 31, 2015 Yen in millions
Small precision motors | Automotive, appliance, commercial and industrial products | Machinery | Electronic and optical components | Others | Total | Eliminations/ Corporate | Consolidated | |
Net sales: | 129,564 | 134,846 | 25,886 | 16,736 | 969 | 308,001 | - | 308,001 |
Exteral sales | ||||||||
Intersegment | 640 | 1,501 | 2,739 | 1,183 | 396 | 6,459 | (6,459) | - |
Total | 130,204 | 136,347 | 28,625 | 17,919 | 1,365 | 314,460 | (6,459) | 308,001 |
Operating expenses | 111,653 | 125,559 | 25,020 | 16,424 | 1,219 | 279,875 | (2,557) | 277,318 |
Operating profit | 18,551 | 10,788 | 3,605 | 1,495 | 146 | 34,585 | (3,902) | 30,683 |
Three months ended December 31, 2016 Yen in millions
Small precision motors | Automotive, appliance, commercial and industrial products | Machinery | Electronic and optical components | Others | Total | Eliminations/ Corporate | Consolidated | |
Net sales: | 119,150 | 135,064 | 32,726 | 16,275 | 983 | 304,198 | - | 304,198 |
Exteral sales | ||||||||
Intersegment | 736 | 1,753 | 2,348 | 1,654 | 383 | 6,874 | (6,874) | - |
Total | 119,886 | 136,817 | 35,074 | 17,929 | 1,366 | 311,072 | (6,874) | 304,198 |
Operating expenses | 100,717 | 122,632 | 29,472 | 15,025 | 1,210 | 269,056 | (2,051) | 267,005 |
Operating profit | 19,169 | 14,185 | 5,602 | 2,904 | 156 | 42,016 | (4,823) | 37,193 |
Notes:
Number of consolidated subsidiaries | 234 |
Number of associates accounted for under the equity method | 6 |
Change from March 31, 2016 | Change from December 31, 2015 | ||
Number of consolidated subsidiaries | (Increase) | 11 | 12 |
(Decrease) | 2 | 15 | |
Number of associates accounted for under the equity method | (Increase) | 2 | 2 |
(Decrease) | - | - |
Note:
Consolidated financial statements for the previous fiscal year and condensed quarterly consolidated financial statements for the nine months ended December 31, 2015 reflect the revision of the initially allocated amounts of acquisition price as NIDEC finalized the provisional accounting treatment for the business combination.
Nidec Corporation published this content on 24 January 2017 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 24 January 2017 06:35:08 UTC.
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