Presentation of Operating Resultsof FY2011

May 8, 2012FUNAI ELECTRIC CO., LTD.
Security code 6839

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Ⅰ．Summary & Remarks by thePresident＆CEO, Hayashi
1.
2.

Summary of Fiscal 2011 (April 2011 to March 2012)
Forecast of Fiscal 2012 (April 2012 to March 2013)

3.
4.

Business Environment
Strategy of Growth①Boost sales and strengthen of existing businesses②Entry into new marketplaces③Launching new businesses

1１． Summary of Fiscal 2011 (April 2011 to March 2012)(100 million yen)

Original ForecastNet Sales(October 28, 2011)

Results

3,1002,650

2,46180324（2.6%）（1.2%）（0.2%）

78.57

78.81

Operating Income(Margin)

Revised Projection

Average USD-JPY
Exchange Rate

83.00

Minus Factor

Summary●Missing the opportunities of production/sales due to the big earth quake
in East Japan and floods in Thailand●More than expected the high yen and the market slowdown in Japan andEurope
Plus Factor●Sound TV inventory2

２． Forecast of Fiscal 2012 (April 2012 to March 2013)(100 million yen)

Net Sales
Operating Income(Margin)
Average USD-JPY
Exchange Rate

Strategic issueof this year

FY2010FY2011FY2012

ResultsResults

Projection

2,959

2,461

2,2907440（0.3%）（0.2%）（1.7%）

85.21

78.8180.00●Black figures of TV business●Strategic move for leap for the current year
and the following year3

３. Business Environment
Economic Trend●US: Right on track for recovery, but concerned for impact on gas price hike●Europe: Sovereign debt crisis still over hanging and uncertainty continues●Emerging: Consumer demand has been growing, but some sign of slowdown

Industry Trend●Rapid growth of smart phone and tablet, acceleration of fusion of AV・PC and Internet●Acceleration of commoditization of TV●Serious slump of Japanese AV manufacturers – Full scale restructuring and alliance has started

Strengthening existing businesses＋launching new growth area
4

４． Strategy of Growth

Entry into newmarketplaces

Launching newbusinesses

Strategy ofGrowth
Boost sales andstrengthen existing
businesses
5４．Strategy of growth- boost sales and strengthen existing businesses (the whole group)

Display Division(ex-TV division)Acceleration of shifting ofR&D base into overseas
Restructuring ofmanufacturing baseStrengthen patent portfolio

Digital Media Division（ex-BD・DVD division）

Thorough curtail of fixed costCultivate new marketplaces

Office Solution Division（ex-Information equip. division）

Further strengthenof cost competitiveness

6４．Strategy of growth- boost sales and strengthen existing businesses (division-wise)

Display Division（ex-TV division）

Digital Media Division（ex-BD・DVD division）●Profit contribution due to optimized
inventory level/add-up SKU at stores●Reinforcement of Philips business●Promotion of capex・in-housemade mold or module●Strengthen of OEM business●Secure survivor’s profit●Launch new items

Office Solution Division（ex-information equip. division）●Launch Laser beam printer business●Commercialize in-house developed printer●Launch LED lighting business7４．Strategy of growth-launch new market places
Global market development with existing andnew reliable channels
UK(re-entry )ChinaCentral Asia
Middle andNear East

・Started thesales subsidiary・Utilization of FTA
between ThailandIndia
ASEAN

Central andSouth America（ Expansion andReinforcement ）・From the sales
sub. In Mexico8５．Strategy of growth-launching into new businesses

Three business fields for mid/long term growthEcology
EnergyNetworkDeviceModule●LED Lighting●Tablet●MEMS●Insulating materials●STB●High-Density
Package

Develop into
appliedproducts

9LED lighting businessStart of sales at full scale from June 2012

LED Tube Light

LED Bulb Light

Full line-up by in-housedevelopment ・production

LED MR16 Spotlight

LED Tunnel Light

10Purchase of IPG patent portfolio assets

Reinforcement of patent portfolio
IPG Electronics
TV
Decoder
Display
devices

relevant
patents

360 patents

Funai Electric Co., Ltd

Purchase

T V
STB
DVR

Utilization ascountermeasures11

Ⅱ．Outline of Operating Results
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.

Summary of 4th Quarter (Jan.-Mar.)Summary of Fiscal 2011 ending March 2012
Breakdown of Sales by Equipment
Sales of DVD related Equipment
Sales of Television related Equipment
Geographic Breakdown of Sales
Factor of Changes of Operating Income
Financial Conditions
Changes of Inventories
Projection of Fiscal 2012 ending March 2013
Projection of Sales by Equipment in Fiscal 2012 ending March 2013
Capital Expenditures, Depreciation Expense and R&D Expenditures12

１．Summary of 4th Quarter (Jan.-Mar.)（100 million yen）

FY2010FY2011

Y/Y△232S a l e s659427(△35.2%)

Operating Income△32△24＋8( M a r g i n )(△5.0%)(△5.8%)＋12 (※1)△27△12＋15( M a r g i n )(△4.2%)(△2.9%)＋2 (※2)Net Income after tax△33△10＋23( M a r g i n )(△5.1%)(△2.4%)

82.33

79.75

N e t

Ordinary Income

Average USD- JPY
Exchange Rate＋7 (※3)＋8 (※4)（※1） interest receivables＋1、forex gain＋12、Other△1（※3） increase of forex gain＋7（※2） extraordinary loss△3、income taxes＋5（※4） increase of extraordinary loss△3、decrease of income taxes＋11Month End
Exchange Rate

10/12

11/3

11/12

12/3491574

82.19

81.

83.

77.

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２．Summary of Fiscal 2011 ending March 2012（100 million yen）

FY2010

ProjectionFY2011

2,9592,6502,461

7324(0.3%)(1.2%)(0.2%)

12151(0.4%)(0.6%)(0.1%)△11△28△46(△0.4%)(△1.1%)(△1.9%)

85.21

78.57

78.81

Net Sales
Operating Income(Margin)

Ordinary Income(Margin)

Net Income after tax(Margin)Average USD- JPY
Exchange Rate

Y/YY/Y(Actual base)(Projection base)△498△189(△16.8%)(△7.1%)△3△3 (※1)△28△8 (※3)

△11△47 (※2)

△14△24 (※4)△35（※3） decrease of interest received △2、forex loss△6、（※5） increase of forex gain＋13、other＋1（※2） extraordinary loss △7、income taxes △31、
income taxes for prior period △9（※4） extraordinary loss △9、increase of income taxes △6、increase of income taxes for prior period △9（※6） increase of extraordinary loss△6、decrease of income taxes＋2

11/3

12/3

83.15

82.19

△4 (※6)△18（※1） interest receivables +2、interest expense △1、forex loss△4Month EndExchange Rate

＋14 (※5)

14３．Breakdown of Sales by Equipment（100 million yen）

（100 million yen）

2,959

Y / Y (Actual base)
AV Equipment

2,650
2,461

： △ 151 （△ 7.6％）

DVD Equip. ： △ 30
T V Equip. ： △ 121（△ 4.6％）（△ 9.1％）

Information Equipment ： △ 264 （△46.8％）

AV
Equipment

1,986
DVD： 656
T V ：1,330

1,994
DVD： 720
T V ：1,274

Information
Equipment
OthersOthers： △ 83 （△20.3％）

Total： △ 498 （△16.8％）

1,835
DVD： 626
T V ：1,209

Y / Y (Projection base)
AV Equipment： △159 （△ 8.0％）

DVD Equip. ： △ 94 （△13.1％）
T V Equip. ： △ 65 （△ 5.1％）

564
325
409
FY2010331
Projection

300

Information Equipment ： △ 25 （△ 7.7％）
Others

： △ 5 （△ 1.5％）

Total： △ 189 （△ 7.1％）

326
FY201115

４．Sales of DVD related Equipment（100 million yen）

Y / Y (Actual base)

720
656
121
DVD Players

144
108

DVD Recorders

・BRD recorder gained, but other equipment fell

626
110
109

125

（100 million yen）

DVD Players： △ 34 （△23.6％）

DVD Recorders： △ 16 （△12.8％）

Blu-ray disc

： ＋ 27 （＋ 7.6％）

Others：△7 （△20.6％）

Total： △ 30 （△ 4.6％）

Y / Y (Projection base)・Adverse impact by floods in Thailand on supply
chain of key components

459
Blu-ray disc

Others380353343227FY2010

Projection

FY2011

DVD Players： △ 11 （△ 9.1％）

DVD Recorders： ＋ 1 （＋ 0.9％）

Blu-ray disc： △ 79 （△17.2％）

Others

： △ 5 （△15.6％）

Total： △ 94 （△13.1％）
16

５．Sales of Television related Equipment（100 million yen）

1,330

1,274

（100 million yen）

1,209

Y / Y (Actual base)・Inched up in N. America, but halved in Japanafter shifting to digital terrestrial broadcasting

LCD TV

1,330

1,274

： △ 121 （△ 9.1%）

1,209
Y / Y (Projection base)・Japan could gain 85% of the projection

LCD TVFY2010

Projection： △ 65 （△ 5.1%）

FY201117

６．Geographic Breakdown of Sales
Y / Y (Actual base)
North America

2,959

・Both of Information and DVD related equip. fell

2,650
2,461
North America

North America： △217 （△13.9%）

Europe： △112 （△47.2%）

1,403

Asia & Others： △ 40 （△18.1%）

(53%)

1,341

Japan： △129（△13.7%）(55%)

Total： △498（△16.8%）

1,558(53%)

238 (8%)Asia & Others 221 (7%)
EuropeJapan

Japan
・BRD recorder increased, but LCD TV andantenna and related devices lostY / Y (Projection base)

144 (5%)188 (7%)942915(32%)(35%)

126 (5%)181 (7%)

Japan・Both of BRD recorder and LCD TV wereshort of the projection

813

North America： △ 62 （△ 4.4%）

Europe： △ 18 （△12.5%）(33%)

Asia & Others

FY2010

Projection

FY2011：△7 （△ 3.7%）

Japan： △102 （△11.1%）

Total： △189（△ 7.1%）
18７．Factor of Changes of Operating Income＊ Add-value=Sales – (Cost of sales + selling expenses)（100 million yen）

《Comparison to Projection》《Comparison to FY2010》

Sales
decrease

Sales
decrease

Decrease ofgeneral expenses

7＋13
Operating
IncomeIncreased
add-value*

4△17Operating
Income32

Decreased
add-value*△36＋20△21FY2010

FY2011

Decrease ofgeneral expenses＋104

Operating
IncomeOperating
IncomeProjection

FY201119

８．Financial Conditions
1,939
Cash / Deposit

AssetsLiabilities
AndNet Assets

700

Accounts
Receivables

363

Inventories

438（100 million yen）

1,820

Y/Y

1,766765

726

373

322

303

339

Fixed Assets
and Others

438379379

Trade Payables

289338296

Accounts Payables
and Others

338273232

Assets△173・Cash / Deposit＋ 26

・Accounts Receivables△ 41・Inventories△ 99

・Fixed Assets and Others

△ 59

△ 99

Liabilities＋・Trade Payables

7

・Accounts Payables and Others △ 106

1,312

Net Assets

1,939
2011/3( Loan Payables

1,238

1,209△ 55)△ 74

Net Assets
・Retained earnings
・Valuation and Translation

△ 53
△ 21

( Foreign Currency Translation
Adjustment△ 14)

Adjustments

1,820

1,766

2011/122012/3（Shareholder’s Equity Ratio 69.5%）
20９．Changes of Inventories（100 million yen）

438
339
Finished products

235

303
（100 million yen）

192

Work in process

223

Y/Y

203
111

116

2010/122011/3

2011/122.0 months

1.5 months

2.4 months

Finished products： △12Work in process： △87<Inventories Turnover>21

10．Projection of Fiscal 2012 ending March 2013（100 million yen）

FY 2012FY 2011
1HNet Sales

2H

Y/Y

(Projection)
12 months

1H2H

12 months

1,406 1,055 2,461 1,020 1,270

1H2H

12 months

2,290 △386＋215△171△10+45+36＋7+31+39＋31+39+71（△27.5％） （＋20.4％） （△7.0％）

Operating
Income21△164112940(margin)(1.5%)(△1.6%)(0.2%)(1.1%)(2.3%)(1.7%)

Ordinary
Income5△31122840(margin)(0.4%)(△0.3%)(0.1%)(1.2%)(2.2%)(1.7%)Net Income
after tax

△29

△16△4622325( m a r g i n )(△2.1%)(△1.5%)(△1.9%)(0.2%)(1.8%)(1.1%)

Average USD/JPY
exchange rate

79.15

78.47

78.81

80.00
22

11．Projection of Sales by Equipment in Fiscal 2012
ending March 2013（100 million yen）

2,461

2,290

（100 million yen）

Y/Y
AV Equipment
AVEquipment

DVD Equip. ： △ 61
T V Equip. ： ＋132

1,835
DVD： 626
T V ：1,209

1,906
DVD： 565
T V ：1,341

Information
Equipment

300

Others326
FY2011： ＋ 71 （＋ 3.9％）（△ 9.7％）（＋10.9％）

Information Equipment ： △120 （△40.0％）
Others： △122 （△37.4％）

Total： △171 （△ 7.0％）180204FY2012(Projection)
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12．Capital Expenditures, Depreciation Expenseand R&D Expenditures（100 million yen）

11/3 vs 12/3
12/3 vs 13/3

R&D Expenditures

Depreciation Expense

Capital Expenditures△20＋1211/3 vs 12/3
12/3 vs 13/3＋ 1△1

11/3 vs 12/3
12/3 vs 13/3

12960405248

FY2010 FY2011 FY2012(Projection)

49△24＋12105

11748

FY2010 FY2011 FY2012(Projection)

FY2010 FY2011 FY2012(Projection)
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Ⅲ． Supplemental Data①
Summary of Operating Results (Jan. – Mar.）

1. Sales by Equipment
2. Sales of AV Equipment
3. Geographic Sales

25

１．Sales by Equipment（100 million yen）

659

427
AVEquipment（100 million yen）

474

Y/Y

DVD：174
T V ：300

AV Equipment
DVD：105
T V ：219

InformationEquipment
Others： △150 （△31.6%）

DVD Equip. ：T V Equip. ：324

△ 69
△ 81（△ 39.7%）（△ 27.0%）

Information Equipment ： △ 30 （△38.0%）

79Others： △ 52 （△49.1%）

Total： △232 （△35.2%）

49

106

54

FY2010(Jan.-Mar.)FY2011(Jan.-Mar.)
26

２．Sales by AV Equipment
DVDTV（100 million yen）

300

174
DVD Players

36

DVD Recorders

28（100 million yen）

219
105
18

LCD TV300

16
Blu-ray disc

219
107
66
53Others

FY2010(Jan.-Mar.)FY2011(Jan.-Mar.)FY2010(Jan.-Mar.)FY2011(Jan.-Mar.)27

３．Geographic Sales（100 million yen）

659

（100 million yen）

North America

318(48%)EuropeAsia & Others

40 (7%)
42 (6%)

427

238

Y/Y
North America： △ 80 （△25.2%）

Europe： △ 22 （△55.0%）(56%)
Asia & Others

Japan18 (4%)
43 (10%)259(39%)128：＋1 （＋ 2.4%）

Japan： △131 （△50.6%）

Total： △232 （△35.2%）(30%)

FY2010FY2011(Jan.-Mar.)(Jan.-Mar.)
28

Ⅳ．Supplemental Data ②
1. Quarterly Operating Summary of FY 2010 / 2011
2. Quarterly Changes of Sales Amount by Equipment

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１．Quarterly Operating Summary of FY 2010 / 2011（100 million yen）

FY2010FY2011

1Q

2Q

3Q

4Q

1Q

2Q

3Q

4Q

S a l e s749791760659656750628427

Operating Income

2520△5△323178△24( M a r g i n )(3.4%)(2.6%)(△0.7%)(△5.0%)（0.5％）（2.4％）（1.3％）(△5.8%)

Ordinary Income1234△7△27048△12( M a r g i n )(1.7%)(4.4%)(△0.9%)(△4.2%)（0.1％）（0.6％）（1.4％）(△2.9%)Net Income after tax

434△16△33△23△6△5△10( M a r g i n )(0.6%)(4.4%)(△2.2%)(△5.1%)（△3.6％）（△0.9％）（△1.0％）(△2.4%)

N e t

30

２．Quarterly Changes of Sales Amount by Equipment
DVD Equipment

TV Equipment

Information Equipment

Others（100 million yen）

749

791

760
659

123
130

750
171

229
174

362

656
184

628
166

427

388
379

280
300

277

79

87

95

105
334
219

171

189

125

86

91

126

106

108

105

69
59

49
54

1Q

2Q

3Q

4Q

1Q

2Q

3Q

4Q

(10/6)(10/9)(10/12)(11/3)(11/6)(11/9)(11/12)(12/3)
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Disclaimer

This document contains forward-looking statements and projections regarding
business performance which are not historical facts. Please note that these statements
are based on information relating to factors that may impact future businessperformance that was available for analysis at the time this document was printed.
These factors include industry trends relating to the business areas of Funai Electric Co.,
Ltd. or the Funai Group, such as audio-visual devices and information communicationequipment, the economic conditions of both domestic and international markets, andfluctuations in currency exchange rates. Actual performance may greatly differ fromprojections included in this document because of the impacts of uncertainty in suchareas as the competitive conditions of the electronics industry, market trends, currency
exchange rate, introduction and success of new products, and various other global
conditions that may affect the tax system and other systems.

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