- Consolidated Net Sales: JPY355.454 billion, up 21.6% year on year and up 1.9% quarter on quarter.
- Operating Income: JPY20.025 billion, increased three times year on year, down 1.6% quarter on quarter.
- Profit Attributable to Owners of the Parent: JPY13.936 billion, increased by 3.4 times year on year, decreased by 24% quarter on quarter.
- Operating Margin: 5.6%, up 3.3 percentage points year on year, down 0.2 percentage points quarter on quarter.
- Precision Technology Segment Net Sales: JPY62.7 billion, up 7.8% quarter on quarter.
- Ball Bearings Sales: JPY42.4 billion, up 8.1% quarter on quarter.
- Rod-ends/Fasteners Sales: JPY14.4 billion, up 3.8% quarter on quarter.
- PMC Sales: JPY5.8 billion, up 17.2% quarter on quarter.
- Precision Technology Segment Operating Income: JPY13 billion, up 18.4% quarter on quarter.
- Precision Technology Segment Operating Margin: 20.8%, up 1.9 percentage points quarter on quarter.
- Motor Lighting and Sensing Segment Net Sales: JPY99.1 billion, up 2.2% quarter on quarter.
- Motors Sales: JPY77.1 billion, up 2.6% quarter on quarter.
- Electronic Devices Sales: JPY7.4 billion, up 3.9% quarter on quarter.
- Sensing Devices Sales: JPY9.1 billion, down 0.7% quarter on quarter.
- Motor Lighting and Sensing Segment Operating Income: JPY5.1 billion, up 2.1% quarter on quarter.
- Motor Lighting and Sensing Segment Operating Margin: 5.2%, up 1.5 percentage points quarter on quarter.
- Semiconductors and Electronics Segment Net Sales: JPY111.2 billion, up 1.6% quarter on quarter.
- Semiconductors and Electronics Segment Operating Income: JPY4.7 billion, down 50.4% quarter on quarter.
- Semiconductors and Electronics Segment Operating Margin: 4.3%, down 4.4 percentage points quarter on quarter.
- Access Solutions Segment Net Sales: JPY81.5 billion, down 1.8% quarter on quarter.
- Access Solutions Segment Operating Income: JPY3.0 billion, up 31.6% quarter on quarter.
- Access Solutions Segment Operating Margin: 3.7%, up 1.0 percentage points quarter on quarter.
- Inventory: JPY359.6 billion, up JPY64.7 billion from three months ago.
- Net Interest-Bearing Debt: JPY151.2 billion, up JPY42.6 billion from the end of the previous fiscal year.
- Full-Year Forecast Net Sales: JPY1,560 billion.
- Full-Year Forecast Operating Income: JPY103 billion.
- Earnings Per Share (EPS): JPY34.5.
Release Date: August 02, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Consolidated net sales for the first quarter increased by 21.6% year on year, reaching JPY355.454 billion.
- Operating income increased three times year on year, totaling JPY20.025 billion.
- Net sales and operating income hit a first-quarter record high.
- Sales of ball bearings increased 8.1% quarter on quarter, driven by recovery in the data center market.
- The company has a positive outlook for the second quarter, expecting further recovery and growth.
Negative Points
- Operating income decreased by 1.6% quarter on quarter.
- Profit attributable to owners of the parent decreased by 24% quarter on quarter.
- Sales of electronic devices fell short of the forecast.
- The Access Solutions segment saw a 1.8% decrease in net sales quarter on quarter, mainly due to stagnant sales in the Chinese market.
- Inventory levels increased significantly, partly due to strategic buildup and foreign currency effects, which could pose a risk if demand does not meet expectations.
Q & A Highlights
Q: How do you view the strength of the data center market and its impact on your full-year guidance?
A: The data center market has shown significant strength compared to the beginning of the year, contributing positively to our full-year outlook. We have revised our guidance upwards based on the strong performance in the first quarter. We believe we can absorb any potential downturns in other segments through the robust performance of the data center market and other core businesses.
Q: Can you elaborate on the ramp-up delay in the actuators segment and its impact on market share?
A: The ramp-up delay for new models caused some initial trouble, leading to a temporary loss in market share. However, the issues have been resolved, and we expect to return to normal production levels from August onwards. Despite this, we are still on track to achieve our full-year guidance.
Q: What is the reason behind the increase in inventories, and how does it impact profitability?
A: The increase in inventories is primarily due to foreign currency effects and the consolidation of Minebea Power Semiconductor Devices. Additionally, we have built up inventories to meet the seasonal demand for game consoles and smartphones in the second quarter. This strategic buildup does not negatively impact our profitability.
Q: How do you view the outlook for the semiconductor market, particularly in light of the integration of Minebea Power Semiconductor Devices?
A: The semiconductor market remains strong, with high-end products offsetting any potential downsides. The integration of Minebea Power Semiconductor Devices is expected to contribute positively from the second quarter onwards. We are optimistic about the market conditions and our ability to capitalize on growth opportunities.
Q: What is your outlook for the automotive business, particularly in the context of electrification and new projects?
A: The automotive business is expected to grow as vehicles become more electrified. We have secured new projects, including a significant one with BMW, which will contribute to our growth over the next few years. We are confident in our ability to capitalize on the increasing demand for automotive components.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
