1 June 5, 2020 Toshiba Corporation FOR IMMEDIATE RELEASE Toshiba Announces Consolidated Results for Fiscal Year 2019, ended March 31, 2020 TOKYO--Toshiba Corporation (TOKYO: 6502) (hereinafter “Toshiba” or “the Company”) today announced its consolidated results for fiscal year (FY) 2019, ended March 31, 2020. All comparisons in the following are based on the same period a year earlier, unless otherwise stated. 1. Overview of Consolidated Results for FY2019 (April 2019 - March 2020) (Yen in billions) FY2019 Change from FY2018 Net sales 3,389.9 (303.6) Operating income 130.5 95.1 Income (loss) from continuing operations, before income taxes and noncontrolling interests (47.5) (58.4) Net income (loss) attributable to shareholders of the Company (114.6) (1,127.9) During FY2019 (April 2019-March 2020), the global economy deteriorated rapidly with the spread of the coronavirus disease (COVID-19) and the plummet in the oil prices. While the U.S. and the Eurozone tried to deal with this severe situation, China saw signs of recovery. In Japan, consumer spending recovered in the early part of the year, though capital investment and exports continued to weaken. However, the impact of COVID-19 towards the end of the fiscal year triggered an abrupt decline in consumer spending and a falloff in exports. In FY2020 (April 2020-March 2021), the U.S. and the Eurozone are expected to continue to feel the impact of COVID-19, and downside risk continues in the global economy. Even though China is expected to feel a lessening impact of COVID-19, its continued effects in other economies point to the possibility of a worsening overall global economy. Japan also expects COVID-19 to remain a major concern, and constant attention to downside risk in the economy is essential. In these conditions, Toshiba Group’s net sales decreased by 303.6 billion yen to 3,389.9 billion yen (US$31,099.7 million). Infrastructure Systems & Solutions, Building Solutions,
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for Fiscal Year 2019 ended March 31, 20 9 · 2020-06-05 · 1 June. 5, 20. 20 Toshiba Corporation. FOR IMMEDIATE RELEASE. Toshiba Announces Consolidated Results. for Fiscal Year 201.
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June 5, 2020
Toshiba Corporation
FOR IMMEDIATE RELEASE
Toshiba Announces Consolidated Results for Fiscal Year 2019, ended March 31, 2020
TOKYO--Toshiba Corporation (TOKYO: 6502) (hereinafter “Toshiba” or “the Company”)
today announced its consolidated results for fiscal year (FY) 2019, ended March 31, 2020.
All comparisons in the following are based on the same period a year earlier, unless
otherwise stated.
1. Overview of Consolidated Results for FY2019
(April 2019 - March 2020)
(Yen in billions)
FY2019 Change from FY2018
Net sales 3,389.9 (303.6)
Operating income 130.5 95.1
Income (loss) from
continuing operations,
before income taxes and
noncontrolling interests
(47.5) (58.4)
Net income (loss)
attributable to shareholders
of the Company
(114.6) (1,127.9)
During FY2019 (April 2019-March 2020), the global economy deteriorated rapidly with
the spread of the coronavirus disease (COVID-19) and the plummet in the oil prices. While
the U.S. and the Eurozone tried to deal with this severe situation, China saw signs of
recovery. In Japan, consumer spending recovered in the early part of the year, though capital
investment and exports continued to weaken. However, the impact of COVID-19 towards
the end of the fiscal year triggered an abrupt decline in consumer spending and a falloff in
exports.
In FY2020 (April 2020-March 2021), the U.S. and the Eurozone are expected to continue
to feel the impact of COVID-19, and downside risk continues in the global economy. Even
though China is expected to feel a lessening impact of COVID-19, its continued effects in
other economies point to the possibility of a worsening overall global economy. Japan also
expects COVID-19 to remain a major concern, and constant attention to downside risk in
the economy is essential.
In these conditions, Toshiba Group’s net sales decreased by 303.6 billion yen to 3,389.9
billion yen (US$31,099.7 million). Infrastructure Systems & Solutions, Building Solutions,
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and Retail & Printing Solutions recorded higher sales. However, Energy Systems &
Solutions saw lower sales, reflecting the reduction of thermal plant construction projects in
Japan and service-related projects. Electronic Devices & Storage Solutions also saw lower
sales on lower demand for mobile HDDs and changes in the memory products resale
channel. Lower sales in Digital Solutions reflected transactions at Toshiba IT-Services
Corporation, while lower sales in Others resulted from the deconsolidation of the PC
business.
Operating income was 130.5 billion yen (US$1,196.9 million), an increase of 95.1 billion
yen. Energy Systems & Solutions, Infrastructure Systems & Solutions, Building Solutions,
Electronic Devices & Storage Solutions, and Digital Solutions all recorded higher operating
income, while Retail & Printing Solutions reported lower operating income in the overseas
retail systems business and printing solutions business.
Income (loss) from continuing operations, before income taxes and noncontrolling interests
was 58.4 billion yen lower at (47.5) billion yen(US$(436.1) million), mainly due to a loss
from the transfer of LNG business and equity losses from Kioxia Holdings Corporation (the
former “Toshiba Memory Corporation”, and hereinafter “Kioxia”).
Net income (loss) attributable to shareholders of the Company decreased by 1,127.9 billion
yen to (114.6) billion yen (US$(1,051.7) million). The primary factors contributing to this
result include the gain from the sale of the memory business and other businesses in the
previous year.
Consolidated Results for FY2019, by Segment
(April 2019 - March 2020)
Please refer to the presentation materials for FY2019 business results, dated June 5, 2020.
Performance Forecast for FY2020
The consolidated forecast for FY2020 is shown below.
(Yen in billions)
FY2020
Forecast
Net sales 3,180.0
Operating income (loss) 110.0
* Income (loss) from continuing operations, before income taxes and noncontrolling interests and Net income
(loss) attributable to shareholders of the Company are not stated in the performance forecast, as the Company is
not involved in the management of Kioxia and does not receive information related to Kioxia’s forecast of equity
earnings (losses), and therefore cannot comment on Kioxia's performance forecasts.
* An impact of (90.0) billion yen from COVID-19 is reflected on Operating income (loss).
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2. Financial Position and Cash Flows for FY2019
Total assets decreased by 913.9 billion yen from the end of March 2019 to 3,383.4 billion
yen (US$31,040.7 million).
Shareholders’ equity, or equity attributable to the shareholders of the Company, was 939.8
billion yen (US$8,622.1 million), a decrease of 516.9 billion yen from the end of March
2019.
Total interest-bearing debt decreased by 39.5 billion yen from the end of March 2019 to
395.2 billion yen (US$3,625.2 million).
Free cash flow decreased by 1,695.0 billion yen to (264.7) billion yen (US$(2,428.1)
million).
3. General Policy on Profit Distribution and Dividends for Current Periods
i. General Policy on Profit Distribution
The Company, while giving full consideration to factors such as the strategic investments
necessary to secure medium to long-term growth, seeks to achieve continuous increases in
its actual dividend payments, in line with a payout ratio of approximately 30%, on a
consolidated basis. The Company's policy* is to continue to strengthen shareholder returns
through share repurchases when its financial condition allows.
*For the time being, equity earnings from Kioxia are not subject to this policy.
ii. FY2019 Dividends
In light of the profit that the Company anticipates in FY2020 and beyond as a result of
implementation of the Toshiba Next Plan, and following its General Policy on Profit
Distribution, the Company declared a dividend total of 20 yen per share for FY2020; 10
yen as an interim dividend and 10 yen as a year-end dividend.
Basic Policy in the Selection of an Accounting Standard
Toshiba Group began preparing consolidated financial statements based on US GAAP
before the consolidated financial statement system was introduced into Japan, and has
continued to use US GAAP for its financial statements. Toshiba Group plans to voluntarily
implement International Financial Reporting Standards (IFRS) for the purpose of
strengthening financial governance; the timing of this implementation is under
consideration.
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Disclaimer:
This report of business results contains forward-looking statements concerning future plans,
strategies and forecasts of Toshiba Group business results. These statements are based on
management’s assumptions and beliefs in light of the economic, financial and other data
currently available. Since Toshiba Group is promoting business under various market
environments in many countries and regions, they are subject to a number of their risks and
uncertainties. Toshiba therefore wishes to caution readers that actual results might differ
materially from our expectations. Major risk factors that may have a material influence on
results are indicated below, although this list is not necessarily exhaustive.
Major disasters, including earthquakes and typhoons;
Disputes, including lawsuits, in Japan and other countries;
Success or failure of alliances or joint ventures promoted in collaboration with other
companies;
Success or failure of new businesses or R&D investment;
Changes in political and economic conditions in Japan and abroad; unexpected
regulatory changes;
Rapid changes in the supply and demand situation in major markets and intensified
price competition;
Significant capital expenditure for production facilities and rapid changes in the market;
Changes in financial markets, including fluctuations in interest rates and exchange rates.
Note:
Toshiba Group’s Consolidated Financial Statements are based on US generally accepted
accounting principles (“GAAP”).
For convenience only, all dollar figures used in reporting FY2019 are calculated at 109 yen
to the dollar.
Operating income (loss) is derived by deducting from net sales the cost of sales, selling,
general and administrative expenses and loss on impairment of goodwill. This result is
regularly reviewed to support decision-making in allocations of resources and to assess
performance. Certain operating expenses such as litigation settlement and other costs are
not included.
# # #
Consolidated
Toshiba Group
Consolidated Financial StatementsFor Fiscal Year 2019 (April 1, 2019 to March 31, 2020)
114
Outline 109
(\ in billions, US$ in millions, except for earnings per share)
Years ended March 31
2020(A) 2019(B) (A)-(B) (A)/(B) 2020
Net sales ¥3,389.9 ¥3,693.5 ¥(303.6) 92% $31,099.7
Operating income 130.5 35.4 95.1 368% 1,196.9
Income (loss) from continuing operations,
before income taxes and
noncontrolling interests
(47.5) 10.9 (58.4) - (436.1)
Net income (loss) attributable to
shareholders of the Company(114.6) 1,013.3 (1,127.9) - (1,051.7)
Basic earnings per share
attributable to shareholders of
the Company
¥(236.39) ¥1,641.85 ¥(1,878.24) $(2.17)
Notes:
1) Consolidated Financial Statements are based on generally accepted accounting principles in the US.
2) The US dollar is valued at \109 throughout this statement for convenience only.
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Consolidated
Comparative Consolidated Balance Sheets
(\ in millions, US$ in thousands)
2020(A) 2019(B) (A)-(B) 2020
Assets
Current assets ¥2,038,099 ¥3,033,858 ¥(995,759) $18,698,156
Cash and cash equivalents 376,973 1,335,520 (958,547) 3,458,468
970,794 1,015,255 (44,461) 8,906,367
Inventories 482,327 468,878 13,449 4,425,018
Other current assets 208,005 214,205 (6,200) 1,908,303
Long-term receivables 7,315 8,603 (1,288) 67,110
505,387 587,017 (81,630) 4,636,578
Property, plant and equipment 420,297 385,720 34,577 3,855,936
3 listed subsidiaries are Toshiba Plant System & Services Corporation, NISHISHIBA ELECTRIC CO., LTD., and NuFlare Technology, Inc.
The impact on Other comprehensive income (loss), net of tax, due to the tender offer for the shares of 3 listed subsidiaries consists of Net unrealized gains and losses
on securities of \16 million ($147 thousand), Foreign currency translation adjustments of \186 million ($1,706 thousand), Pension currency translation adjustments of \(3,077 million)
($28,229 thousand), and Net unrealized gains and losses on derivative instruments of \10 million ($92 thousand).
Balance at March 31, 2019
Equity attributable
to noncontrolling
interests
Total equityCommon stockAdditional
paid-in capital
Retained earnings
(accumulated deficit)
Accumulated
other comprehen-
sive loss
Treasury stock
Equity attributable to
shareholders of
the Company
Cumulative effect of application of ASU 2016-02
Transfer to retained earnings (accumulated deficit) from
additional paid-in capital
Change in ownership for noncontrolling
interests and others
Change due to tender offer for shares of 3 listed subsidiaries
Dividends attributable to shareholders of
the Company
Dividends attributable to noncontrolling
interests
Balance at March 31, 2020
Net loss
Other comprehensive income (loss), net of tax:
Purchase, disposal and retirement of treasury stock, net, at
cost
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Consolidated
Comparative Consolidated Statements of Cash Flows
109
(\ in millions, US$ in thousands)
Cash flows from operating activities
¥(96,453) ¥1,035,597 ¥(1,132,050) $(884,890)
Depreciation and amortization 79,615 78,518 1,097 730,413
Equity in (earnings) losses of affiliates, net of dividends 67,318 (6,608) 73,926 617,596
(Gain) loss from sales and impairment of securities, net 484 (936,386) 936,870 4,440
(Increase) decrease in notes and accounts receivable, trade 38,891 (41,935) 80,826 356,798
Increase in inventories (20,049) (65,899) 45,850 (183,936)
Decrease in notes and accounts payable, trade (156,220) (10,396) (145,824) (1,433,211)
Others (55,734) 71,964 (127,698) (511,320)
(45,695) (910,742) 865,047 (419,220)
(142,148) 124,855 (267,003) (1,304,110)
Cash flows from investing activities
6,170 6,386 (216) 56,606
Acquisition of property, plant and equipment (119,267) (122,555) 3,288 (1,094,193)
Acquisition of intangible assets (15,901) (15,682) (219) (145,881)
Purchase of securities (3,497) (1,913) (1,584) (32,083)
(Increase) decrease in investments in affiliates 295 (30,381) 30,676 2,706
Proceeds from sale of Toshiba Memory Corporation stock - 1,458,289 (1,458,289) -
Others 9,686 11,290 (1,604) 88,863
Net cash provided by (used in) investing activities (122,514) 1,305,434 (1,427,948) (1,123,982)
Cash flows from financing activities
Proceeds from long-term debt 160,910 4,605 156,305 1,476,239
Repayment of long-term debt (352,691) (198,906) (153,785) (3,235,697)
Decrease in short-term borrowings, net (13,377) (63,047) 49,670 (122,725)