NEC announces financial forecast revisions
Tokyo, Japan – May 8, 2020 – NEC Corporation (NEC; TSE: 6701) today announced revisions to the consolidated financial forecasts announced on January 29, 2020 for the fiscal year ended March 31, 2020.
NEC will announce financial results for the fiscal year ended March 31, 2020 on May 12, 2020.
1. Revised consolidated financial forecasts for the fiscal year ended March 31, 2020 (April 1, 2019 to March 31, 2020)
(In billions of yen)
|Revenue||Operating Profit||Adjusted operating profit||Net profit attributable to owners of the parent||Adjusted net profit attributable to owners of the parent|
|Previous forecasts (A)
(Announced on January 29, 2020)
|Revised forecasts (B)||3,090.0||127.0||145.0||100.0||111.0|
FY ended March 31, 2019 (IFRS)
2. Reasons for financial forecast revisions
Regarding the consolidated financial forecasts for the fiscal year ended March 31, 2020, the NEC Group anticipates consolidated revenue of 3,090.0 billion yen, an increase of 140.0 billion yen from the previous forecasts. This increase is due to factors that include strong domestic ICT investment.
The NEC Group anticipates consolidated operating profit of 127.0 billion yen, an increase of 17.0 billion yen from the previous forecasts. This increase is mainly due to increased profit from the previous estimates owing to increased sales in the System Platform business, the Network Services business and the Public Solutions business.
The NEC Group anticipates consolidated adjusted operating profit of 145.0 billion yen, an increase of 20.0 billion yen from the previous forecasts.
The NEC Group anticipates net profit attributable to owners of the parent of 100.0 billion yen, an increase of 35.0 billion yen from the previous forecasts, mainly due to improved operating profit and a decrease in tax expenses associated with the completion of liquidation of subsidiaries.
The NEC Group anticipates adjusted net profit attributable to owners of the parent of 111.0 billion yen, an increase of 37.0 billion yen from the previous forecasts.
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:
- adverse economic conditions in Japan or internationally;
- foreign currency exchange and interest rate risks;
- changes in the markets in which we operate;
- the recent outbreak of the novel coronavirus;
- potential inability to achieve the goals in our medium-term management plan;
- fluctuations in our revenue and profitability from period to period;
- difficulty achieving the benefits expected from acquisitions, business combinations and reorganizations;
- potential deterioration in our relationships with strategic partners or problems relating to their products or services;
- difficulty achieving our growth strategies outside Japan;
- potential inability to keep pace with rapid technological advancements in our industry and to commercialize new technologies;
- intense competition in the markets in which we operate;
- risks relating to our concentrated customer base;
- difficulties with respect to new businesses;
- potential failures in the products and services we provide;
- potential failure to procure components, equipment or other supplies;
- difficulties protecting our intellectual property rights;
- potential inability to obtain certain intellectual property licenses;
- our customers may encounter financial difficulties;
- difficulty attracting, hiring and retaining skilled personnel;
- difficulty obtaining additional financing to meet our funding needs;
- potential failure of internal controls;
- potentially costly and time-consuming legal proceedings;
- risks related to regulatory change and uncertainty;
- risks related to environmental laws and regulations;
- information security and data protection concerns and restrictions;
- potential changes in effective tax rates or deferred tax assets, or adverse tax examinations;
- risks related to corporate governance and social responsibility requirements;
- risks related to natural disasters, public health issues, armed hostilities and terrorism;
- risks related to our pension assets and defined benefit obligations; and
- risks related to impairment losses with regard to goodwill.
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 has established itself as a leader in the integration of IT and network technologies while promoting the brand statement of “Orchestrating a brighter world.” NEC enables businesses and communities to adapt to rapid changes taking place in both society and the market as it provides for the social values of safety, security, fairness and efficiency to promote a more sustainable world where everyone has the chance to reach their full potential. For more information, visit NEC at https://www.nec.com.
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