NEC announces financial forecast revisions
Tokyo, Japan – April 24, 2017 – NEC Corporation (NEC; TSE: 6701) today announced revisions to the consolidated financial forecasts announced on January 30, 2017 for the fiscal year ended March 31, 2017.
NEC will announce financial results for the fiscal year ended March 31, 2017 on April 27, 2017.
1. Revised consolidated financial forecasts for the fiscal year ended March 31, 2017 (April 1, 2016 to March 31, 2017)
(In billions of yen)
|Revenue||Operating Profit||Net profit attributable to owners of the parent|
Previous forecasts (A)(Announced on January 30, 2017)
|Revised forecasts (B)||2,665.0||41.0||27.0|
FY ended March 31, 2016 (IFRS)
2. Reasons for financial forecast revisions
Regarding the consolidated financial forecasts for the fiscal year ended March 31, 2017, the NEC Group anticipates consolidated revenue of 2,665.0 billion yen, a decrease of 15.0 billion yen from the previous forecasts. This decrease is mainly due to decreased sales from the previous estimates in the Public business and in international business in Others, despite increased sales from the previous estimates in the System Platform business.
The NEC Group anticipates consolidated operating income of 41.0 billion yen, an increase of 11.0 billion yen from the previous forecasts. This increase is mainly due to increased profit from the previous estimates through cost efficiencies in the System Platform business and the Telecom Carrier business, despite the impact of decreased sales.
The NEC Group anticipates net profit attributable to owners of the parent of 27.0 billion yen, an increase of 7.0 billion yen from the previous forecasts, mainly due to improved operating profit.
Cautionary Statement with Respect to Forward-Looking Statements
This material contains forward-looking statements regarding estimations, forecasts, targets and plans in relation to the results of operations, financial conditions and other overall management of the NEC Group (the "forward-looking statements"). The forward-looking statements are made based on information currently available to NEC and certain assumptions considered reasonable as of the date of this material. These determinations and assumptions are inherently subjective and uncertain. These forward-looking statements are not guarantees of future performance, and actual operating results may differ substantially due to a number of factors.
The factors that may influence the operating results include, but are not limited to, the following:
- Effects of economic conditions, volatility in the markets generally, and fluctuations in foreign currency exchange and interest rate
- Trends and factors beyond the NEC Group's control and fluctuations in financial conditions and profits of the NEC Group that are caused by external factors
- Risks arising from acquisitions, business combinations and reorganizations, including the possibility that the expected benefits cannot be realized or that the transactions may result in unanticipated adverse consequences
- Developments in the NEC Group's alliances with strategic partners
- Effects of expanding the NEC Group's global business
- Risk that the NEC Group may fail to keep pace with rapid technological developments and changes in customer preferences
- Risk that the NEC Group may lose sales due to problems with the production process or due to its failure to adapt to demand fluctuations
- Defects in products and services
- Shortcomings in material procurement and increases in delivery cost
- Acquisition and protection of intellectual property rights necessary for the operation of business
- Risk that intellectual property licenses owned by third parties cannot be obtained and/or are discontinued
- Risk that the NEC Group may be exposed to unfavorable pricing environment due to intensified competition
- Risk that a major customer changes investment targets, reduces capital investment and/or reduces the value of transactions with the NEC Group
- Risk that the NEC Group may be unable to provide or facilitate payment arrangements (such as vendor financing) to its customers on terms acceptable to them or at all, or risk that the NEC Group's customers are unable to make payments on time, due to the customers' financial difficulties or otherwise
- Risk that the NEC Group may experience a substantial loss of, or an inability to attract, talented personnel
- Risk that the NEC Group's ability to access the commercial paper market or other debt markets are adversely affected due to a downgrade in its credit rating
- Risk that the NEC Group may incur large costs and/or liabilities in relation to internal control, legal proceedings, laws and governmental policies, environmental laws and regulations, tax practice, information management, and human rights and working environment
- Consequences of natural and fire disasters
- Changes in methods, estimates and judgments that the NEC Group uses in applying its accounting policies
- Risk that the NEC Group may incur liabilities and losses in relation to its retirement benefit obligations
The forward-looking statements contained in this material are based on information that NEC possesses as of the date hereof. New risks and uncertainties come up from time to time, and it is impossible for NEC to predict these events or how they may affect the NEC Group. NEC does not intend to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
About NEC Corporation
NEC Corporation is a leader in the integration of IT and network technologies that benefit businesses and people around the world. By providing a combination of products and solutions that cross utilize the company's experience and global resources, NEC's advanced technologies meet the complex and ever-changing needs of its customers. NEC brings more than 100 years of expertise in technological innovation to empower people, businesses and society. For more information, visit NEC at http://www.nec.com.
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