Announcement of Revisions to Consolidated Results Forecasts
Taking into account recent business conditions, Mabuchi Motor Co., Ltd. hereby announces that it has revised its consolidated results forecasts for the six months ended June 30, 2011 and for the fiscal year ending December 31, 2011, which were announced on February 15, 2011.
Revisions to Forecasts
Six Months Ended June 30, 2011 (January 1, 2011 — June 30, 2011)
| Net Sales | Operating Income | Ordinary Income | Net Income | Net Income Per Share(Yen) | |
|---|---|---|---|---|---|
| Previous Forecast(A) | 41,400 | 2,800 | 3,400 | 2,900 | 82.77 |
| Revised Forecast(B) | 38,800 | 1,800 | 3,200 | 2,200 | 62.79 |
| Amount Change(B-A) | -2,600 | -1,000 | -200 | -700 | - |
| Percentage Change(%) | -6.3 | -35.7 | -5.9 | -24.1 | - |
| Reference: Actual Result for Six Months Ended June 30, 2010 | 41,787 | 3,793 | 4,442 | 3,183 | 90.85 |
Fiscal Year Ending December 31, 2011 (January 1, 2011 — December 31, 2011)
| Net Sales | Operating Income | Ordinary Income | Net Income | Net Income Per Share(Yen) | |
|---|---|---|---|---|---|
| Previous Forecast(A) | 88,000 | 7,000 | 8,400 | 6,500 | 185.52 |
| Revised Forecast(B) | 82,500 | 3,500 | 5,000 | 3,300 | 94.19 |
| Amount Change(B-A) | -5,500 | -3,500 | -3,400 | -3,200 | - |
| Percentage Change(%) | -6.3 | -50.0 | -40.5 | -49.2 | - |
| Reference: Actual Result for Fiscal Year Ended December 31, 2010 | 82,752 | 6,624 | 7,587 | 5,260 | 150.14 |
Although the Great East Japan Earthquake was expected to result in production adjustments among our customers and disruptions in global distribution, given the difficulty of quantifying those effects because of the many elements of uncertainty at that time, the Consolidated Financial Results for the Three Months Ended March 31, 2011 (announced o April 28, 2011) left the previous consolidated results forecasts for the current fiscal year (announced on February 15, 2011) unchanged, to be determined and announced after continued careful examination. Since that time, in addition to the effect of the earthquake on demand for sales, we have collected information and closely followed developments in the external environment including trends in commodity markets and the yen’s appreciation in foreign exchange markets, as well as the sharp rise in prices for rare earth metals seen since April. As a result, we have been able to forecast the impact of the major factors seen having an effect on the Company’s results for the current fiscal year, which we announce below.
(1) Reasons for the revision of the consolidated results forecasts for the six months ended June 30, 2011
As a result of the Great East Japan Earthquake, sales in our core market of automotive products—and especially sales of products for Japanese vehicles—have decreased. In addition, ongoing inventory adjustments for certain products in the other markets we serve—audio & visual equipment, optical & precision instruments, and home appliances, power tools & toys—are leading to weak sales in emerging markets, and as a result, we have lowered our previous forecast for consolidated net sales for the six months ended June 30, 2011, by 6.3%, to ¥38,800 million.
With regard to profit forecasts, operating income is expected to be ¥1,800 million, or a decline of 35.7% from the previous forecast, reflecting downwardly revised sales volumes prospects and higher increases in market product prices than originally anticipated. Ordinary income is expected to be ¥3,200 million, or a relatively small decrease of 5.9% from the previous forecast, because foreign exchange gains and other non-operating income are expected to be higher than planned. Net income for the six months ended June 30, 2011, is expected to be ¥2,200 million, which is 24.1% below the previous forecast.
(2) Reasons for the revision of the consolidated results forecasts for the fiscal year ending December 31, 2011
Although our prioritized strategic products for power window lifters and power seats in the automotive products market—a core market we serve—are enjoying favorable sales, disrupted supply chains due to the earthquake continued to affect the industries we serve, and it remains uncertain how much the decline in demand for our other major products during the first half of 2011 will pick up in the coming months. For the other markets in which we operate, an increase in demand for products geared toward the year-end sales season is expected to be lower than originally projected. For these reasons, consolidated net sales for the full fiscal year ending December 31, 2011, are expected to be ¥82,500 million, or 6.3% lower than the previous forecast.
With regard to profit forecasts, we revised sales volumes prospects according to the status of our product sales to the present and the revised demand prospects for the year-end sales season, and reexamined the possible effects of soaring raw material prices and growing appreciation of the yen. As a result, we have revised downward the full-year forecasts for operating income, ordinary income and net income by 50.0%, 40.5% and 49.2%, respectively, from our previous forecasts to ¥3,500 million, ¥5,000 million and ¥3,300 million, respectively. In particular, this reflects higher market prices for copper, which affects the prices of major materials including copper wire, and sharply higher prices for rare earth metals, a raw material for the magnets used in certain products. With regard to foreign exchange rates in the second half, we anticipate a further ¥2 appreciation against the US dollar relative to our previous forecast, and are using an exchange rate assumption of ¥80 to the US dollar for the second half of 2011.
Our annual dividend forecast for the fiscal year ending December 31, 2011, remains unchanged at ¥100 per share as originally projected.
Note: The above forecasts are based on the information currently available. Actual results are subject to change because of a variety of factors.
Contact: Hiroo Okoshi, Director and General Manager of Administration Headquarters (Tel: +81-47-710-1127)
