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NEC announces financial forecast revisions

Tokyo, Japan - February 29, 2016 - NEC Corporation (NEC; TSE: 6701) today announced revisions to the consolidated financial forecasts announced on January 28, 2016 for the fiscal year ending March 31, 2016.

1. Revised consolidated financial forecasts for the fiscal year ending March 31, 2016 (April 1, 2015 to March 31, 2016)

(In billions of yen)

  Net Sales Operating
Profit attributable to owners of parent
Previous Forecast (A)
(announced January 28, 2016)
3,100.0 135.0 120.0 65.0
Revised Forecast (B) 2,900.0 100.0 85.0 65.0
Difference (B)-(A) -200.0 -35.0 -35.0 -
Change (%) -6.5% -25.9% -29.2% -
FY ended March 31, 2015
2,935.5 128.1 112.1 57.3

2. Reasons for financial forecast revisions

NEC forecasts net sales of 2,900.0 billion yen, 200.0 billion yen less than the previous forecast. This is mainly due to, decreased sales in the Public business by delay of large-scale projects into the next fiscal year and loss of prospective projects, and a decrease in sales of the Telecom Carrier business as a result of investment restraint in the Japanese market and slower growth in overseas business, as well as decreased sales in the Smart Energy business.

NEC forecasts operating income of 100.0 billion yen, 35.0 billion yen less than the previous forecast, mainly due to an increase in loss-making projects in the Public business and the Telecom Carrier business, in addition to a decrease in net sales.

NEC also forecasts ordinary income of 85.0 billion yen, 35.0 billion yen less than the previous forecast, due to a decrease in operating income.

NEC forecasts profit attributable to owners of parent of 65.0 billion yen, same as the previous forecast, despite a decrease in ordinary income. This is mainly because a decrease of tax expense of about 24.0 billion yen is expected for the fiscal year ending March 2016, as disclosed today in the "NEC announces debt waiver of a consolidated subsidiary" press release.

3. Regarding dividends

As previously announced, NEC expects to pay a year-end dividend of 6 yen per share of common stock for the fiscal year ending March 31, 2016.



This material contains forward-looking statements pertaining to strategies, financial targets, technology, products and services, and business performance of NEC Corporation and its consolidated subsidiaries (collectively "NEC"). Written forward-looking statements may appear in other documents that NEC files with stock exchanges or regulatory authorities, such as the Director of the Kanto Finance Bureau, and in reports to shareholders and other communications. NEC is relying on certain safe-harbors for forward-looking statements in making these disclosures. Some of the forward-looking statements can be identified by the use of forward-looking words such as "believes," "expects," "may," "will," "should," "seeks," "intends," "plans," "estimates," "targets," "aims," or "anticipates," or the negative of those words, or other comparable words or phrases. You can also identify forward-looking statements by discussions of strategy, beliefs, plans, targets, or intentions. Forward-looking statements necessarily depend on currently available assumptions, data, or methods that may be incorrect or imprecise and NEC may not be able to realize the results expected by them.
You should not place undue reliance on forward-looking statements, which reflect NEC's analysis and expectations only. Forward-looking statements are not guarantees of future performance and involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those in the forward-looking statements. Among the factors that could cause actual results to differ materially from such statements include (i) global economic conditions and general economic conditions in NEC's markets, (ii) fluctuating demand for, and competitive pricing pressure on, NEC's products and services, (iii) NEC's ability to continue to win acceptance of NEC's products and services in highly competitive markets, (iv) NEC's ability to expand into foreign markets, such as China, (v) regulatory change and uncertainty and potential legal liability relating to NEC's business and operations, (vi) NEC's ability to restructure, or otherwise adjust, its operations to reflect changing market conditions, (vii) movement of currency exchange rates, particularly the rate between the yen and the U.S. dollar, (viii) the impact of unfavorable conditions or developments, including share price declines, in the equity markets which may result in losses from devaluation of listed securities held by NEC, and (ix) impact of any regulatory action or legal proceeding against NEC. Any forward-looking statements speak only as of the date on which they are made. 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 NEC. NEC does not undertake any obligation to update or revise any of the forward-looking statements, whether as a result of new information, future events, or otherwise.
The management targets included in this material are not projections, and do not represent management's current estimates of future performance. Rather, they represent targets that management will strive to achieve through the successful implementation of NEC's business strategies.
Finally, NEC cautions you that the statements made in this material are not an offer of securities for sale. Securities may not be offered or sold in any jurisdiction in which required registration is absent or an exemption from registration under the applicable securities laws is not granted.

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