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Operating Results and Forecast

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Consolidated Operating Results for the First Nine Months of the Fiscal Year Ending March 31, 2013

Overview


In the first nine months of the fiscal year ending March 31, 2013, the Japanese economy saw a gradual recovery backed by restoration-led demand following the Great East Japan Earthquake as well as steady consumer spending. However, production and exports declined due mainly to the downturn in the European and Chinese economies, friction between Japan and China and the prolonged appreciation of the yen. Moreover, there was a recoil in production after the termination of the Japanese government's eco-car subsidy program. Reflecting these factors, the overall economy remained weak from September 2012 onward.
In the months after September, in the lead up to the December 2012 Japanese governmental elections and expected regime change, the yen began to depreciate while stock prices rose, fostering a sense that the economy was seeing a partial bottoming out. Despite these signs, the economic outlook remains unpredictable.

Under these circumstances, the Ryobi Group promoted proactive marketing and the development of new products to meet user needs while taking various measures to reduce costs, improve productivity and streamline business operations.

As a result, performance in the first nine months included a slight increase in revenues compared with the same period of the previous year; however, earnings decreased due to a decline in profitability.


Consolidated Earnings
Nine months ended
December 31, 2011
Nine months ended
December 31, 2012
Change
Millions of
yen
% of
net sales
Millions of
yen
% of
net sales
Millions of
yen
%
Net sales 123,256 124,263 1,006 0.8%
Operating income 5,892 4.8% 2,544 2.0% -3,347 -56.8%
Net income 3,018 2.4% 1,174 0.9% -1,844 -61.1%


Performance by Industry Segment


The Die Castings Business recorded an increase in revenues and a decrease in earnings year on year. The growth in revenues was attributable to a rise in production in China as well as firm orders received in the United States. However, earnings decreased along with a decline in the profit margin attributable mainly to higher fixed costs and cuts in product prices.

The Printing Equipment Business recorded a decline in revenues year on year and an increase in operating loss. Capital investment remained weak in the printing industry, reflecting a downturn in demand for printing, which has been affected by global economic deceleration. Despite a rise in sales in Japan, sales in this segment fell and operating loss rose because of a lack of growth in exports due to sluggish overseas orders.

The Power Tools and Builders' Hardware Business recorded decreases in revenues and earnings year on year. Despite the fall in power tools, domestic sales remained virtually the same year on year thanks to an increase in the sales of builders' hardware. However, segment sales declined because of lower exports accompanying yen appreciation and other factors. In addition, sales competition is further intensifying, causing the profit margin to drop and thus lowering earnings.


Net Sales by Industry Segment
Nine months ended
December 31, 2011
Nine months ended
December 31, 2012
Change
Millions of
yen
% of
consolidated
net sales
Millions of
yen
% of
consolidated
net sales
Millions of
yen
%
Die Castings 91,011 73.9% 93,928 75.6% 2,917 3.2%
Printing Equipment 13,097 10.6% 11,447 9.2% -1,649 -12.6%
Power Tools and
Builders' Hardware
19,148 15.5% 18,886 15.2% -261 -1.4%
Total 123,256 100.0% 124,263 100.0% 1,006 0.8%

Operating Income /Loss by Industry Segment
Nine months ended
December 31, 2011
Nine months ended
December 31, 2012
Change
Millions of
yen
% of
segment
net sales
Millions of
yen
% of
segment
net sales
Millions of
yen
%
Die Castings 4,422 4.9% 1,666 1.8% -2,756 -62.3%
Printing Equipment -673 -5.1% -822 -7.2% -148 -
Power Tools and
Builders' Hardware
2,143 11.2% 1,701 9.0% -441 -20.6%
Total 5,892 4.8% 2,544 2.0% -3,347 -56.8%

Note: Total amounts are after balancing out intersegment transactions.


Consolidated Financial Statements for the First Nine Months of Fiscal 2013 < PDF 62KB >



Forecasts for the Fiscal Year Ended March 31, 2013

Previously, on October 17, 2012, the Ryobi Group announced its consolidated performance forecasts for the fiscal year ended March 31, 2013. As of April 18, 2013, the Group upwardly revised said forecasts as shown in the table below.


Consolidated Performance Forecast for the Full Fiscal Year Ended March 31, 2013
Announced October 17, 2012 Announced April 18, 2013 Change
Millions of yen Millions of yen Millions of yen %
Net sales 166,000 166,500 500 0.3%
Operating income 3,300 3,300 0 0.0%
Net income 1,200 2,000 800 66.7%


Operating Results for Fiscal 2012