FY2016 1st Quarter Consolidated Financial Results (April 1, 2016 to June 30, 2016) (PDF:103KB)

FY 2016 FIRST QUARTER CONSOLIDATED FINANCIAL RESULTS‌‌

(April 1, 2016 to June 30, 2016)

1. Company Name : SANKEN ELECTRIC CO., LTD.

2. Code NO :

   6707

3. Headquarters : 3-6-3 Kitano, Niiza-shi, Saitama 352-8666, Japan 4.URL : http://www.sanken-ele.co.jp/

5.Contact : Finance and Investor Relations Division Tel. [phone]

1. FINANCIAL RESULTS FOR THE THREE MONTHS ENDED JUNE 30, 2016

2. Consolidated Results of Operations

   Net sales (millions of yen)	Operating income (millions of yen)	Ordinary income (millions of yen)	Profit attributable to owners of parent (millions of yen)
   Three months ended Jun.30,2016 Three months ended Jun.30,2015	36,899 (1.9%) 36,198 (-1.1%)	319 (61.0%) 198 (-88.0%)	-594 ( - ) -137 ( - )	-1,182 ( - ) -602 ( - )

   Note1: Comprehensive income: -5,672 million yen ( -%) for three months ended June 30, 2016 / 592 million yen ( -%) for three months ended June 30, 2015 Note2: Indication of percentages shows the ratio of increase or decrease from the first quarter of the previous fiscal year.

   Net income per share (yen)	Diluted net income per share (yen)
   Three months ended Jun.30,2016 Three months ended Jun.30,2015	-9.76 -4.97	- -

3. Consolidated Financial Position (Millions of yen)

4. Total assets	Net assets	Shareholders' equity ratio
   As of June 30, 2016 As of March 31, 2016	172,421 184,711	48,283 53,959	27.8% 29.0%

   Reference: Shareholders' equity: 47,959 million yen as of June 30, 2016 / 53,572 million yen as of March 31, 2016

5. DIVIDEND INFORMATION

   Dividend per share
   First quarter	Second quarter	Third quarter	Fiscal-year-end	Annual
   Fiscal year 2015 Fiscal year 2016	- -	3.50yen	-	0.00yen	3.50yen
   Fiscal year 2016(forecast)	0.00yen	-	-	-

6. FISCAL YEAR 2016 CONSOLIDATED FINANCIAL FORECAST (April 1, 2016 to March 31, 2017) (Millions of Yen)

   Net sales (percentage change from the previous year)		Operating income (percentage change from the previous year)		Ordinary income (percentage change from the previous year)		Profit attributable to owners of parent (percentage change from the previous year)		Net income per share
   Second quarter (cumulative)	74,000	(-4.3%)	1,800	(-38.7%)	1,000	(-34.5%)	-400	－	-3.30yen
   Full Year	156,000	(0.1%)	7,000	(2.9%)	5,500	(45.0%)	2,500	－	20.62yen

7. OTHER

9. Changes in significant subsidiaries during the three months ended June 30, 2016 (changes in particular subsidiaries accompanying the change in scope of consolidation): No

10. Application of particular accounting method for quarterly consolidated financial statements: Yes

11. Changes in accounting policies, changes in accounting estimates, restatements

    • Changes in accounting policies due to the amendment of accounting standards, etc. : No

    • Changes in accounting policies due to reasons other than above : No

    • Changes in accounting estimates : No

    • Restatements : No

      Jun./2016:	125,490,302	Mar./2016:	125,490,302
      Jun./2016:	4,277,015	Mar./2016:	4,275,417
      Apr./2016-Jun./2016	121,214,409	Apr./2015-Jun./2015	121,235,468

12. Number of shares outstanding (common share)

    • Number of shares outstanding at the end of the period (including treasury stock)

    • Number of treasury stocks at the end of the period

    • Average number of shares outstanding during three months ended June 30

* The above description about future matters including financial forecast is based upon information available as of the present time and assumptions we considered valid. Due to various factors, our actual performance could greatly differ from the forecast. For assumptions and notes regarding the forecasts, refer to "Qualitative Information concerning the Forecast of Consolidated Business Results ".

1. QUALITATIVE INFORMATION ABOUT CONSOLIDATED BUSINESS RESULTS FOR THE THREE MONTHS ENDED JUNE 30, 2016
2. QUALITATIVE INFORMATION OF CONSOLIDATED OPERATING RESULTS

   During the current first quarter consolidated fiscal period the global economy remained on a moderate recovery trend as a whole, buoyed by increased personal consumption associated with improved employment conditions in the US in spite of the persistent economic slowdown in China and other factors of concern. The Japanese economy also held steady on a moderate recovery trend, though personal consumption remained sluggish. Under these circumstances, the Company maintained a basic policy stressing activities to "Focus on growing markets" and "Enhance financial performance," strove to improve profitability by changing the composition of its product lineups, and worked to reduce inventory. In the first quarter consolidated fiscal period, sales of automotive products in the semiconductor devices segment progressed steadily, while sales in the power modules segment and the power systems segment remained stagnant. As a result, net sales were ¥36,899 million, an increase of ¥700 million (1.9%) as compared to the same period in the previous year. Operating income was ¥319 million, an increase of ¥120 million (61.0%), resulting from increased net sales. Foreign exchange loss increased, however, forcing us to record an ordinary loss of ¥594 million (ordinary loss of ¥137 million in the same period in the previous year) and quarterly net loss attributable to owners of parent of ¥1,182 million (quarterly net loss attributable to owners of parent of ¥602 million in the same period in the previous year).

   Overview of business by segment is as follows.

   In the semiconductor devices segment, sales of automotive products and products for white goods such as washers and refrigerators increased. As a result, consolidated net sales from this segment were ¥30,921 million, an increase of ¥1,220 million (4.1%) as compared to the same period in the previous year. For income, consolidated operating income was ¥1,708 million, an increase of ¥391 million (29.8%) as compared to the same period in the previous year, resulting from increased net sales.

   For the power modules segment, sales of automotive products, the product category of focus for the Company, increased as compared to the same period in the previous year, while sales of adapters decreased. As a result, consolidated net sales from this segment were ¥4,001 million, a decrease of ¥66 million (1.6%) as compared to the same period in the previous year. For income we recorded consolidated operating loss of

   ¥355 million (consolidated operating loss of ¥285 million in the same period in the previous year) mainly because net sales decreased and the Company's work to establish high value-added business portfolios was still in progress.

   For the power systems segment, sales of products for the telecommunication market remained weak mainly due to contracted corporate investments for mobile phone stations, and sales of products for new energy were sluggish as well. As a result, consolidated net sales from this segment were ¥1,975 million, a decrease of ¥453 million (18.7%) as compared to the same period in the previous year. For income, we recorded consolidated operating loss of ¥285 million (consolidated operating loss of ¥123 million in the same period in the previous year), stemming from decreased net sales.

3. QUALITATIVE INFORMATION OF CONSOLIDATED FINANCIAL POSITION

   Assets as of the end of the three months ended June 30, 2016 were ¥172,421 million, a decrease of ¥12,290 million from the end of the previous consolidated fiscal year. This was mainly due to a decrease in Total property, plant and equipment of ¥4,028 million, notes and accounts receivable - trade of ¥3,932 million and inventories of ¥1,959 million.

   Liabilities were ¥124,137 million, a decrease of ¥6,614 million from the end of the previous consolidated fiscal year. This was mainly due to a decrease in current portion of bonds of ¥10,000 million, short-term loans payable of ¥1,641 million, accrued expenses of ¥1,524 million, and an increase in commercial papers of ¥8,500 million.

   Net Assets were ¥48,283 million, a decrease of ¥5,676 million from the end of the previous consolidated fiscal year. This was mainly due

4. QUALITATIVE INFORMATION OF CONSOLIDATED FINANCIAL FORECAST

5. Concern about the future of the global economy has been increasing due to adverse factors such as growing uncertainty about the direction in U.S. monetary policy and the future of the EU in the aftermath of the UK's decision to depart from the union, as well as the downward pressure of the Chinese economy mainly attributable to stock adjustment. Uncertainty about the future trends of the Japanese economy has also been growing due to factors such as the impacts of the sharply rising yen on corporate activities and sluggish personal consumption. Under these circumstances, the Company will strive to concentrate on strategic fields such as automotive products and products for white goods and increase sales through the development of new products. The Company will also endeavor to improve its product mix by establishing high value-added business portfolios and achieve the enhancement of our financial conditions. Through these measures, the Company will make concerted efforts to achieve goals of the group plan for fiscal 2016.

6. QUARTERLY CONSOLIDATED FINANCIAL STATEMENTS‌
7. (1) QUARTERLY CONSOLIDATED BLANCE SHEETS

   Millions of yen

   ASSETS

   Current assets

   March 31 June 30

   2016 2016

   Cash and deposits	17,924	17,040
   Notes and accounts receivable - trade	33,999	30,067
   Merchandise and finished goods	17,971	17,633
   Work in process	24,778	23,986
   Raw materials and supplies	9,839	9,010
   Deferred tax assets	2,095	1,942
   Other	5,606	5,360
   Allowance for doubtful accounts	(10)	(11)
   Total current assets	112,204	105,029

   Non-current assets

   Property, plant and equipment Buildings and structures, net	22,837	21,505
   Machinery, equipment and vehicles, net	26,788	25,022
   Tools, furniture and fixtures, net	1,105	997
   Land	5,039	4,861
   Leased assets, net	1,323	1,078
   Construction in progress	4,921	4,520
   Total property, plant and equipment	62,015	57,987
   Intangible assets
   Software	3,717	3,589
   Other	1,954	1,838
   Total intangible assets	5,671	5,427
   Investments and other assets
   Investment securities	1,204	1,129
   Deferred tax assets	204	175
   Other	3,656	2,916
   Allowance for doubtful accounts	(244)	(244)
   Total investments and other assets	4,820	3,976
   Total non-current assets	72,507	67,391
   Total assets	184,711	172,421