From April 1, 2014
To September 30, 2014

November 4, 2014
Funai Electric Co., Ltd.

Second Quarter (April‐September) Consolidated Financial Summary
for the Period Ending March 2015
(Million yen)Previous Year Second Quarter

Current Year Second Quarter

From April 1, 2013
to Septembr 30, 2013

From April 1, 2014
to September 30, 2014

AmountAmount%%%Net Sales

Rate ofincrease or
decrease%%

120,570

100.0

115,808

100.0

(3.9)

Operating Income (Loss)

567

0.5

1,332

1.2

134.8

Ordinary Income (Loss)

2,163

1.8

2,785

2.4

28.8

Net Income (Loss) before Taxes
and Other Adjustments

937

0.8

2,952

2.5

214.9

Net Income (Loss) after Tax

612

0.5

2,624

2.3

328.4

Net Income (Loss) per Share

17.96

76.94

Notes: Includes 20 consolidated subsidiaries, 1 non‐consolidated subsidiary of equity method, 1 affiliated company ofequity method.

Member, Financial Accounting Standards Foundation

Financial Report for the 6‐Month Period ended September 30, 2014
November 4, 2014

Listed company name:

Funai Electric Co., Ltd.

Securities Code: 6839

Tokyo Stock ExchangeFirst Section(URL http://www.funai.jp/ )Representative: President and CEO
Tomonori Hayashi
Tetsuhiro Maeda
Inquiries: General Manager, Accounting Department
Scheduled date of Quarterly Report; November 4, 2014
Scheduled date of Commencement of Annual Dividend Payment; －Quarterly Financial Results Supplementation: Yes
Quarterly Financial Results Seminar: Yes

TEL: (072) 870‐4395

1. Second Quarter Consolidated Results for the Period Ending March 2015 (April 1, 2014 – September 30, 2014)(1) Operating Results (Consolidated)(% denotes year on year)
Ordinary Income
Net Income
Net Sales
Operating Income
Million yen%
Million yen %Million yen%
Million yen
%
28.8
2,624
328.4
115,808
(3.9)
1,332
134.8
2,785
2nd Quarter FY2014
2,163
612
120,570
35.4
567
－
－
－
2nd Quarter FY2013(Reference) Comprehensive Income 2nd Quarter FY 2014 ended September 30, 2013
6,420 million yen (145.5%)
2,614 million yen ( －%)2nd Quarter FY 2013 ended September 30, 2012
Net Income
Per Share

Net Income Per Shareon a Fully Diluted BasisYen

Yen
2nd Quarter FY2014
2nd Quarter FY2013

－
－

76.94
17.96

(2) Consolidated Financial Position

2nd Quarter FY2014
Fiscal Year 2013
(Reference) Equity

Net Assets
Equity Ratio
Total Assets
Million yen
Million yen%
191,332
123,38163.9
181,341
117,684
64.2
2nd Quarter FY 2014 ended September 30, 2014 122,210 million yen
Fiscal Year 2013 ended March 31, 2014
116,509 million yen

2. Dividends
Dividend per Sharest

1 Quarternd

2 Quarteryen

3rd Quarteryen

Fiscal Year 2013

－

0.00

Fiscal Year 2014

－

0.00

Fiscal Year 2014
(Projection)ndYear‐Endyen

Annual
yen

yen

－

35.00

35.00

－

－

－

(Note) Revision of Annual Dividends Forecast in this 2 Quarter: Yes
The dividend for FY 2014 has been undecided. The company’s dividend policy of DOE is unchanged.
Because of the high impact stemmed from the recent fluctuations in exchange rates give to the consolidated
net assets, the dividend is to be disclosed at the time of disclosure has become possible to public.

3. Forecast of Consolidated Results for the Fiscal Year ending March 2015 (April 1, 2014 ‐ March 31, 2015)(% denotes year on year)
Operating
Ordinary
Net Income
Net Sales
Net Income
IncomeIncomePer Share
Million yen

Full Year%

203,000 (13.3)

Million yen %500－

Million yen %

1,400

－

Million yen %

900

－

Yen

26.38

(Note) Revision of Forecast of Consolidated Results for the six month period or the Full Year in this 2nd Quarter: Yes*Note(1) Changes in Consolidated Subsidiaries (Changes in Scope of Consolidation): No(2) Application of simplified accounting procedure and use of unique accounting procedure for preparation offinancial statements covering consolidated accounting in this 1st quarter: Yes(3) Changes in Accounting Practices, Procedures and Presentation Methods for Consolidated Financial Results
1. Changes arising from revision of accounting standards: Yes
2. Changes arising from other factors: No
3. Changes in accounting estimates: No
4. Restatement: No(4) Number of Shares Outstanding (Ordinary Shares)
1. Number of shares outstanding (including treasury stock) as of September 30, 2014; 36,130,796 shares
as of March 31, 2014; 36,130,796 shares
2. Number of shares of treasury stock as of September 30, 2014; 2,011,615 shares
as of March 31, 2014; 2,011,615 shares
3. The Average number of outstanding shares on September 30, 2014; 34,119,181 shareson September 30, 2013; 34,119,181 shares* The Recording of Implementation Conditions Regarding Quarterly Review ProceduresThis quarterly financial summary does not fall within the scope of the Quarterly Review Procedures referenced in the
Financial Instruments and Exchange Act. At the time of disclosure of the quarterly financial summary, the Group was in
the process of implementing the quarterly review procedures for its quarterly financial statements.

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 factorsthat may impact future business performance 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 communication equipment, the economic
conditions of both domestic and international markets, and fluctuations in currency exchange rates. Actual
performance may greatly differ from projections included in this document because of the impacts ofuncertainty in such areas 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.

1. Qualitative Information Regarding Quarterly Financial Results(1) Explanation of Business Performance
During the first six months of the fiscal year ending March 31, 2015, the economy of the United States, a key market
for the Funai Group, continued to recover as a result of a robust housing market and stable employment situation,
despite concerns about the outlook for consumer spending. Business conditions in European were stagnant,reflecting worsening of the situation in the Ukraine, and China’s economy slowed due to factors including
deterioration in the housing market. The pace of economic recovery in Japan was sluggish because of factors
including a reaction to last‐minute demand ahead of the consumption tax increase and the impact of bad weather.
In these circumstances, the Funai Group posted net sales for the first six months of the fiscal year of JPY 115,808
million, down 3.9% year on year. On the profit front, operating income was JPY 1,332 million, up 134.8%, ordinary
income was 2,785 million, up 28.8%, and net income was 2,624 million, up 328.4%.
The Funai Group saw an improvement trend in profitability as a result of factors including an increase in screen
sizes and strong shipments of LCD TVs, a key product, ahead of the peak year‐end selling season, improved
efficiency from selective reduction of the range of audio accessories to high‐selling items, and rigorous inventory
control.
Segment conditions by location were as follows:i) Japan
Although revenues from BD‐related products increased, sales of printers, DVD‐related products, and LCD TVs
declined. As a result, net sales were JPY 24,767 million, down 12.0% year on year, and segment loss (operatingloss) was JPY 294 million, compared to segment income (operating income) of 832 million in the first six
months of the previous year.
ii) Americas
Although revenues from LCD TVs rose due to factors including an increase in screen sizes, sales of DVD‐related
and BD‐related products fell as a result of market contraction, and sales of audio accessories declined slightly
due to selective product range reduction. As a result, net sales were JPY 87,265 million, down 2.1% year on year.
However, segment income (operating income) was JPY 1,402 million, compared to segment income of 32
million in the first six months of the previous year.
(Notes)
Effective from the first quarter of the fiscal year under review, the Company has changed the name of a reportable segmentfrom the previous North America to Americas. This is a change of name only and has no impact on segment information.

iii) Asia
Net sales were JPY 2,475 million, up 16.4% year on year, on higher revenues from ink cartridges and otherproducts. Segment income (operating income) was JPY 531 million, up 43.5% compared to the same period of
the previous year.
iv) Europe
Although ink cartridges contributed to revenues and sales of DVD‐related products picked up, the slump in LCD
sales continued. As a result, net sales were JPY1,299 million, up 8.9% year on year, and segment loss (operatingloss) was JPY 42 million, compared to segment loss of JPY 310 million in the first six months of the previous year.

Sales by product segment were as follows:i) Audiovisual Equipment
In the audiovisual equipment sector, although revenues from LCD TVs were nearly unchanged from the first six
months of the previous year, sales of DVD‐related products declined sharply due to market contraction. As aresult, net sales of audiovisual equipment were JPY 91,012 million, down 3.1% year on year.
ii) Information Equipment
In the information equipment sector, although revenues from ink cartridges increased, lower revenues fromprinters resulted in net sales of JPY 9,618 million, down 10.4% year on year.
iii) Other Products
Net sales of other products were JPY 15,177 million, down 4.8% year on year, on lower revenues fromreceiver‐related electronic equipment, audio accessories, and other products.
(2) Qualitative Information Relating to Consolidated Financial Position
Consolidated total assets increased by JPY 9,990 million compared to the end of the previous fiscal year. Thechange is mainly attributable to increases of JPY 9,735 million in cash and deposits and JPY 2,927million inmerchandise and finished goods and a decrease of JPY 3,049 million in raw materials and supplies.
Total liabilities increased by JPY 4,294 million compared to the end of the previous fiscal year. The change is mainly
attributable to increases of JPY 1,315 million in short‐term loans payable and JPY 4,393 million in accounts payable
included in “Other” under current liabilities and a decrease of JPY 1,537 million in notes and accounts payable‐
trade.
Net assets increased by JPY 5,696 million compared to the end of the previous fiscal year. The change is mainly
attributable to increases of JPY 1,914 million in retained earnings and JPY 3,655 million in the foreign currencytranslation adjustment account.
(3) Qualitative Information Relating to Consolidated Performance Forecasts:
The Company has revised the consolidated operating performance forecasts released on May 12, 2014. For details,
please refer to “Funai Electric Announces Differences between Forecasts and Actual Performance for the First Six
Months of the Fiscal Year Ending March 31, 2015, the Recording of Non‐operating Income (Exchange Gains), andRevision of the Full‐Year Consolidated Operating Performance Forecasts ,” released today (November 4, 2014).
Note: The operating results outlook is a forward‐looking statement about the future performance of the Company and is based on
management’s assumptions and beliefs in light of information currently available, and involves known and unknown risks anduncertainties. Various factors such as changes in economic conditions overseas, especially in the main U.S. market, and severe
price fluctuations may cause actual events and results to differ materially from those anticipated in these statements.

2. Summary Information(1) Unique accounting procedure for preparation of consolidated financial statements for fiscal quarter
Expenses relating to taxes are calculated by applying the estimated effective tax rates on the before‐tax net profit for
the fiscal quarter, through a practical estimation of the effective tax rates that will take effect after the application of
the tax effect accounting for before‐tax net profits of the consolidated fiscal year, including this second fiscal quarter.
(2) Change in accounting policy(Application of accounting standard for retirement benefits)
Effective from the first quarter of the fiscal year under review, the Company has applied the provisions set forth in themain clauses of Paragraph 35 of the Accounting Standard for Retirement Benefits (ASBJ Guidance No. 26, May 17,2012) and Paragraph 67 of the Guidance on Accounting Standard for Retirement Benefits (ASBJ Guidance No. 25, May
17, 2012). As a result, the methods for calculating retirement benefit obligations and service costs have been revised in
the following respects: the method for attributing projected benefits to periods has been changed from thestraight‐line basis to the benefit formula basis, and the method for determining the discount rate has been changed
from a discount rate based on the average period until payment of estimated amount of retirement benefits to use asingle weighted‐average discount rate that reflects the periods until the expected payment of retirement benefits andthe amount of projected benefits for each period.
Application of the Accounting Standard for Retirement Benefits and Guidance on Accounting Standard for
Retirement Benefits conforms to the transitional treatment set forth in Paragraph 37 of the Accounting Standard for
Retirement Benefits, and the effect of changing the method for calculating retirement benefit obligations and service
costs was recognized by adjusting retained earnings at the beginning of the current first quarter.
As a result, net defined benefit assets and net defined benefit liabilities at the beginning of the current second
quarter increased by JPY 934 million and JPY 200 million, respectively, retained earnings increased by JPY 483 million,
and minority interests decreased by JPY 11 million. The effect of this change on consolidated operating income andloss, ordinary income and loss, and income and loss before income taxes for the current second quarter is immaterial.
(3) Additional Information(About anti‐tax haven law)
The Funai Group received a rectification notice from the Osaka Regional Taxation Bureau on June 29, 2011. The
Bureau determined that our Hong Kong subsidiary does not meet the requirements for exclusion under the anti‐tax
haven system and the Hong Kong subsidiary’s income for the three fiscal years ended March 31, 2008 through 2010,
will be considered, and taxed as our income. We objected to these supplementary tax assessments, and filed apetition with the Osaka Regional Tax Tribunal on August 25, 2011, to overturn the supplementary tax assessment
order. Thereafter, we received written verdicts on this case on July 24, 2012 indicating that our assertions had been
dismissed. We will continue to assert the validity of its arguments in the future.
The additional tax of JPY 825 million (JPY 935 million including incidental taxes) includes corporate, enterprise andresidence taxes. We charged the tax assessments to income as “prior year’s taxes” in the fiscal year ended March 31,
2012.
The financial effect of applying the tax system beginning in the fiscal year ended March 31, 2011, the accounting
period after the fiscal year in which the tax examination concluded, has been charged to income.

3. Consolidated Financial Statements(1) Consolidated Quarterly Balance Sheets(Units : Million Yen)
Fiscal year 2013
(As of March 31, 2014)

2nd Quarter FY2014(As of September 30, 2014)ASSETS;
Current Assets
Cash and deposits

49,16758,903

Notes and accounts receivable ‐ trade

37,68137,961

Merchandise and finished goods

31,66534,592Work in process

1,182

1,150

Raw materials and supplies

16,427

13,378

Other

8,126

8,804

Allowance for doubtful accounts

(210)

(414)

144,041

154,376

Property, plant and equipment

21,90522,441Intangible assets

6,574

6,235

335

1,266

Other

8,780

7,269

Allowance for doubtful accounts

(296)

(256)

Total current assets
Noncurrent Assets

Investments and other assets
Net defined benefit asset

Total investments and other assets

8,819

8,278

37,30036,955

181,341

191,332

Notes and accounts payable ‐ trade32,942

31,405

Short‐term loans payable

4,526

5,842

414

441

Provision

1,312

1,274

Other

14,497

18,711

Total current liabilities

53,692

57,674Long‐term loans payable

6,121

6,297

Provision

1,088

1,087

775

928

Total noncurrent assets
TOTAL ASSETSLIABILITIES;Current Liabilities

Income taxes payableNoncurrent Liabilities

Net defined benefit liability
Other

1,979

1,963

Total noncurrent liabilities

9,964

10,27663,656

67,951TOTAL LIABILITIESFiscal year 2013
(As of March 31, 2014)

2nd Quarter FY2014(As of September 30, 2014)

NET ASSETS;
Shareholders' equity
Capital stock

31,30731,307

Capital surplus

33,27233,272Retained earnings

93,196

95,110Treasury shares(24,341)(24,341)

Total shareholders' equity

133,435

135,349

672

780

Foreign currency translation adjustment(17,495)(13,839)

Remeasurements of defined benefit plans

(103)

(79)

(16,925)(13,139)

132

135

1,042

1,035

117,684

123,381

181,341

191,332

Accumulated other comprehensive income
Valuation difference on available‐for‐sale securities

Total accumulated other comprehensive income
Subscription rights to shares
Minority interests
Total net asset
TOTAL LIABILITIES AND NET ASSETS

(2) Consolidated Quarterly Statements of Income and Consolidated Quarterly Statement ofComprehensive Income(Consolidated Quarterly Statements of Income)(Units : Million Yen)
2nd Quarter FY2013

2nd Quarter FY2014( from April 1, 2013
to September 30, 2013)( from April 1, 2014
to September 30, 2014)

Net sales

120,570

115,808

Cost of sales

100,961

94,918Gross profit

19,60820,889Selling, general and administrative expenses

19,04019,557567

1,332Interest income

7075Dividends income

23

88

1,851

1,397

59

309

2,004

1,870

Interest expenses

103

90

Equity in losses of affiliates

55

139

Payment compensation cost

147

－

Other

101

186

Total non‐operating expenses

407

416

2,163

2,785

Gain on disposal of noncurrent assets

047Gain on sales of shares of subsidiaries and associates－

134

Gain on negative goodwill

8

－

Other

‐

1

Total extraordinary income

8

184

15

17

1,149

‐

70

‐

1,234

17

Income (loss) before income taxes

937

2,952

Income taxes

305

323

Income (loss) before minority interests

631

2,628

Minority interests in income

193

Net income (loss)

612

2,624

Operating income (loss)
Non‐operating income

Foreign exchange gains
Other
Total non‐operating income
Non‐operating expenses

Ordinary income (loss)
Extraordinary income

Extraordinary loss
Loss on disposal of noncurrent assets
Expenses incurred on business restructuring
Loss on valuation of investment securities
Total extraordinary loss*1

(Consolidated Quarterly Statement of Comprehensive Income)

Income (loss) before minority interest adjustment(Units : Million Yen)

2nd Quarter FY2013

2nd Quarter FY2014( from April 1, 2013
to September 30, 2013)( from April 1, 2014
to September 30, 2014)

631

2,628

112

109

1,828

3,663

41

(8)

‐

25

Other comprehensive Income
Valuation difference on avaiable‐for‐sale securities
Foreign currency translation adjustment
Share of other comprehensive income of associates
accounted for using equity method
Retirement benefits adjustment
Total other comprehensive Income

1,982

3,791

2,614

6,420

Comprehensive income attributable to owners of parent

2,595

6,411

Comprehensive income attributable to minority interests

19

8

Comprehensive income(Breakdown)(3) Consolidated quarterly statements of cash flows(Units : Million Yen)
2nd Quarter FY2013

2nd Quarter FY2014( from April 1, 2013
to September 30, 2013 )( from April 1, 2014
to September 30, 2014 )Net cash provided by (used in) operating activities
Income before income taxes and minority interests

937

2,952

3,217

2,829

Increase(decrease) in allowance for doubtful accounts

(23)

85

Increase(decrease)in provision for retirement benefits

(10)

－

Increase(decrease)in liabilities for retirement benefits

－

(56)

Interest and dividends income

(93)

(164)

Interest expenses

103

90

Equity in (earnings) losses of affiliates

55

139

Loss (gain) on sales of property, plant and equipment

(0)

(42)

Loss (gain) on valuation of investment securities

70－

Loss(gain) on sales of shares of subsidiaries and associates

－

(134)

Decrease (increase) in notes and accounts receivable‐trade(5,355)2,238

Decrease (increase) in inventories

4,964

2,399

(11,948)(4,696)

Increase(decrease) in accounts payable ‐ other

871

4,171

Other, net

220

81

Subtotal

Depreciation and amortization

Increase (decrease) in notes and accounts payable‐trade(6,991)

9,892

Interest and dividends income received

120

161

Interest expenses paid

(179)

(90)

Income taxes paid

(1,028)(538)

Income taxes refund

522

24

(1,171)－(8,725)(9,449)

Repayments from time deposits

13,129－Purchase of property, plant and equipment(3,012)(2,281)

Income taxes for prior periods paid
Net cash provided by (used in) operating activities*1

Net cash provided by (used in) investment activities

Proceeds from sales of property, plant and equipment

099(3,807)

(195)

(244)

(6)

－

518

(5,534)－

Other, net

(318)

194

Net cash provided by (used in) investment activities

213(1,671)

Net increase (decrease) in short‐term loans payable(7,562)

1,001

Repayment of long‐term loans payable

1,500

－

Cash dividends paid

(1,194)(1,194)Purchase of intangible assets
Purchase of investment securities
Proceeds from sales of investment securities
Payment for acquisition of shares of newly consolidated subsidiaries

Net cash provided by (used in) financing activities

(476)

(211)

Net cash provided by (used in) financing activities

Other, net(7,733)(404)

Effect of exchange rate change on cash and cash equivalents

1,323

2,361

Net increase (decrease) in cash and cash equivalents(14,922)

9,735

Cash and cash equivalents at beginning of period

50,23843,612

Cash and cash equivalents at end of period

35,31553,348

(4) Consolidated Quarterly Statements of Income(Notes for Continuing Enterprises)
Not Applicable(Notes of remarkable changes in Shareholders Equity)
Not Applicable(Consolidated balance sheets)
Second Quarter Consolidated Fiscal Period – Year to Date (As of September 30, 2014)
Contingent liabilities(Arbitration)
Funai Electric Co., Ltd. (hereinafter, “Funai”) resolved to acquire from Koninklijke PHILIPS N.V. (hereinafter, “PHILIPS”)
all shares in a company that will hold the operation of the PHILIPS’ Lifestyle Entertainment Business and concluded ashare purchase agreement on January 29, 2013. But PHILIPS filed against Funai a petition as of October 25, 2013 forarbitration to claim compensation for damages on the grounds of breach of the agreement by Funai and the petition
has been served on November 8, 2013 by the International Chamber of Commerce.
With regard to this matter, Funai recognizes there to have been no breach of contract on its behalf. Consequently,
on December 6, 2013, Funai filed with the International Chamber of Commerce a counterclaim for claiming
compensation for damages on the grounds of breach of the agreement and undue action by PHILIPS.
Funai was presented with €171.8 million, statutory interest and arbitration costs as the amount of claim forcompensatory damages from Philips on May 20, 2014. Subsequently, on October 1, 2014 the Company filed astatement with the International Court of Arbitration including indication of the amount of compensatory damages
claimed against PHILIPS.
The results of these arbitral proceedings may affect the Funai Group’s operating performance, but given the
difficulty of making a rational estimate of this impact during this second quarter consolidated fiscal period, such impact
has not been reflected in the Funai Group’s operating performance or financial condition.
Following is the outline of arbitration filed against Funai and counterclaim filed by Funai.
1. Outline of arbitration filed against Funai(1) Institution and date of arbitrationi) Institution where petition for arbitration is filed: International Chamber of Commerceii) Date of petition for arbitration: October 25, 2013
(2) Petitioner of arbitrationi) Name : Koninklijke PHILIPS N.V.
ii) Location : Eindhoven, The Netherlandsiii) Title & name of representative : Chief Executive Officer Frans van Houten(3) Details of petition and claimed amount for damagesi) Details of petition : A claim for damages on the grounds of breach of the agreement by Funaiii) Claimed amount : €171.8 million, statutory interest and arbitration costs
2. Outline of counterclaim filed by Funai(1) Institution with which counterclaim filed and date of filingi) Institution with which counterclaim filed : International Chamber of Commerceii) Date of counterclaim: December 6, 2013
(2) Other party to counterclaim filingi) Name : Koninklijke PHILIPS N.V.
ii) Location : Eindhoven, The Netherlandsiii) Title & name of representative : Chief Executive Officer Frans van Houten(3) Details of petition and claimed amount for damagesi) Details of petition : Claim for damages on the grounds of breach of the agreement and undue action by PHILIPSii) Claimed amount : an indication of the amount of compensatory damages claimed in such counterclaim,
consisting of EUR 312.3M (equivalent to JPY 43.1B when converted at EUR 1 to JPY 138) , theamount of tax payable,contractual interest and arbitration costs.
An overview of the above‐mentioned share purchase agreement is as follows.
1. Name of other company and content of acquired businesses(1) Name of other company : Koninklijke PHILIPS N.V.
(2) Content of acquired businesses : Lifestyle Entertainment Business(Note) The Lifestyle Entertainment Business involves the development and design, sales and (partial) manufacture of the
PHILIPS‐brand Audio Video Multimedia products, Home Communication products and Accessories products.

2. Reasons for Acquiring the Shares
The Transaction to assume the operation will enable the Funai Group to expand the lineup of products that it handles
and expand its sales region to include Asia, South America and other emerging markets, as well as advanced countries
in Europe. Funai decided to acquire shares in the New Company, based on the belief that the acquisition would foster
sustained growth of the Funai Group's business.
3. Acquisition price and percentage of shares held after acquisition
Acquisition price : €150 million
Percentage of shares held after acquisition : 100%
(Consolidated quarterly statements of income)Second Quarter Consolidated Fiscal Period – Year to Date (April 1, 2013 to September 30, 2013)*1 Expenses incurred on business restructuring stem mainly from costs incurred due to the shrinking of the overseas
LED business, principally including an inventory valuation loss of JPY 217 million, an impairment loss on investment in
subsidiaries and associated companies of JPY 646 million and impairment losses of JPY 255 million.
(Consolidated quarterly statements of cash flows)
Second Quarter Consolidated Fiscal Period – Year to Date (April 1, 2013 to September 30, 2013)*1 During the first six months of the fiscal year, a consolidated subsidiary, FUNAI EUROPE GmbH, received from theGerman tax authorities a request for correction in with regard to transfer pricing taxation on transactions with Funai
Electric, as well as with another consolidated subsidiary, FUNAI ELECTRIC EUROPE Sp.z o.o. A supplementary tax
assessment was accordingly paid.

(Information by Segment)[Segment Information]
I.

Second Quarter Consolidated Fiscal Period – Year to Date (April 1, 2013 to September 30, 2013)
Information Regarding Net Sales and Profit/Loss Conditions by Reporting Segment(Units: Million Yen)
Adjustments Consolidated
Japan
N. America
Asia
EuropeTotal(Note 1)
(Note 2)Net Sales(1) Outside customers
28,137
89,112
2,126
1,193
120,570－
120,570(2) Inter‐segment sales
75,389083,207
0
158,597 (158,597)－
Total
Segment Income (Loss)

103,526

89,11285,334

1,194

279,167(158,597)

120,570

832

32

369

(310)

924

(356)

567

Note:
1. JPY ‐356 million adjustment amount under segment income includes items such as the JPY 20 million relating to
the cancellation of inter‐segment transactions, JPY ‐399 million of overall Group expenses that are notapportioned to each reporting segment, and the JPY 22 million adjustment relating to inventory assets. Overall
Group expenses are comprised of general administrative expenses that do not belong to a specific reporting
segment.
2. Segment income has been adjusted to operating income noted on the second quarter consolidated income
statement.
II.

Second Quarter Consolidated Fiscal Period – Year to Date (April 1, 2014 to September 30, 2014)
Information Regarding Net Sales and Profit/Loss Conditions by Reporting Segment(Units: Million Yen)Japan

N. America

Asia

Europe

Total

Adjustments Consolidated(Note 1)
(Note 2)Net Sales(1) Outside customers(2) Inter‐segment sales

24,767
69,64087,265434

2,475
77,795

1,299‐

115,808
147,870－(147,870)

115,808－

Total

94,40887,70080,2701,299

263,679(147,870)

115,808

(294)

1,402

531

(42)

1,596

(263)

1,332

Segment Income (Loss)

Note:
1. JPY ‐263 million adjustment amount under segment income includes items such as the JPY 1 million relating to
the cancellation of inter‐segment transactions, JPY ‐367 million of overall Group expenses that are notapportioned to each reporting segment, and the JPY 102 million adjustment relating to inventory assets. Overall
Group expenses are comprised of general administrative expenses that do not belong to a specific reporting
segment.
2. Segment income has been adjusted to operating income noted on the second quarter consolidated income
statement.
2. Change a Reportable Segment(Application of Accounting Standard for Retirement Benefits)
Effective from the first quarter of the fiscal this year under review, the Company has applied the provisions set forth in
the main clauses of Paragraph 35 of the Accounting Standard for Retirement Benefits (ASBJ Guidance No. 26, May 17,2012) and Paragraph 67 of the Guidance on Accounting Standard for Retirement Benefits (ASBJ Guidance No. 25, May
17, 2012). As a result, the methods for calculating retirement benefit obligations and service costs have been revised in
the following respects: the method for attributing projected benefits to periods has been changed from thestraight‐line basis to the benefit formula basis, and the method for determining the discount rate has been changed
from a discount rate based on the average period until payment of estimated amount of retirement benefits to use asingle weighted‐average discount rate that reflects the periods until the expected payment of retirement benefits andthe amount of projected benefits for each period. The effect of this change is immaterial.
(Change the Name of a Reportable Segment)
Effective from the first quarter of the fiscal this year under review, the Company has changed the name of a reportablesegment from the previous North America to Americas. This is a change of name only and has no impact on segment
information. Segment information for the current first quarter is presented using the revised segment name.

from 2014.4.1
to 2014.9.30
Page
1. Summary of 2Q (April to September) Financial Statements (Consolidated)(1) Operating Results, Financial Conditions ･････････････････････････････

1(2) Profitability and Per Share Data etc. ････････････････････････････････

1(3) Capital Expenditures, Depreciation, R&D Expenses ･･････････････････

1(4) Cash Flow ･･･････････････････････････････････････････････････････

2

2. Operating Activities (Consolidated)(1) Slaes by Equipment ･･･････････････････････････････････････････････

2(2) Sales by Area in Equipment ････････････････････････････････････････

3(3) Sales by Equipment in Areas ･･･････････････････････････････････････

3

3. Summary of 2Q (July to September)Financial Statements(Consolidated)(1) Operating Results ･･････････････････････････････････････････････････

4(2) Sales by Equipment ･････････････････････････････････････････････････

4

１．Summary of 2Q (April to September) Financial Statements (Consolidated)(1) Operating Results, Financial Conditions
FY 20132Q (Apr. ‐ Sep.)

Full‐Year%%

AmountChange Amount

1,205

100.0

Operating Income (Loss)5

0.5

Ordinary Income (Loss)

21

1.8

Net Sales

Change Amount

2,340

100.0

－

(54)

(2.3)

－

(22)

(1.0)

35.4

2Q (Apr. ‐ Sep.)%（Units : 100 million yen, %）FY 2014
Full‐Year (Projections)%

Change

2,030

100.0

(13.3)

Change Amount

1,158

100.0

(3.9)

－

13

1.2

134.8

5

0.2

－

－

27

2.4

28.8

14

0.7

－

21.9

6

0.5

－

(67)

(2.9)

－

26

2.3

328.4

9

0.4

－

Total Assets

1,810

－

－

1,813

－

－

1,913

－

－

－

－

－

Net Assets

1,226

－

－

1,176

－

－

1,233

－

－

－

－

－

Net Income (Loss) after Tax（※） Yen‐Dollars / Exchange rate
FY 20132Q (Apr. ‐ Sep.)
Average Rate in each Period

Full‐Year
98.64

100.49（Units : Yen / Dollars）
FY 20142Q (Apr. ‐ Sep.)
Full‐Year (Projections)103.61102.80(2) Profitability and Per Share Data etc.
FY 2013
（％）

16.3

13.9

FY 2014
Full‐Year (Projections)
18.0
17.5

Operating Income Ratio （％）

0.5

(2.3)

1.2

0.2

Ordinary Income Ratio （％）

1.8

(1.0)

2.4

0.7

2Q (Apr. ‐ Sep.)
Gross Profit Ratio

Full‐Year

2Q (Apr. ‐ Sep.)

67.1

64.2

63.9

－

Net Assets Per Share（yen）

3,561.17

3,414.77

3,581.87－

Net Income Per Share

（yen）

17.96

(197.70)

76.94

26.38

Return on Assets

（％）

0.3

(3.6)

1.4

－

Return on Shareholders' Equity （％）

0.5

(5.7)

2.2

－

4,976

5,112

3,761

－

Shareholders' Equity Ratio （％）

Number of Total Employees(3) Capital Expenditures, Depreciation, R&D Expenses
FY 20132Q (Apr. ‐ Sep.)
AmountChange92

Capital Expenditures

Full‐Year
Amount384.2

2Q (Apr. ‐ Sep.)

Change109

Amount105.7

Change22

Full‐Year%%

AmountChange Amount

2Q (Apr. ‐ Sep.)
Change AmountAmount(76.1)FY 20132Q (Apr. ‐ Sep.)（Units : 100 million yen, %）FY 2014
Full‐Year (Projections)%

Change37(66.1)FY 2014
Full‐Year (Projections)

Change Amount%

ChangeDepreciation Expenses

26

2.2

30.0

52

2.2

30.0

23

2.0

(11.5)

48

2.4

(7.7)

R&D

43

3.6

(8.5)

84

3.6

(9.7)

39

3.4

(9.3)

79

3.9

(6.0)

－1－

(4) CashFlow

Cash flows provided by operating activities

(87)

(12)

（Units : 100 million yen）
FY 2014
Full‐Year (Projections)94－

Income Before Income Taxes

9

(56)

29

－

Depreciation Expenses

32

64

28

－

(128)

(20)

37

－

2

(27)

(16)

－

Free cash flows

(85)

(39)

78

－

Cash flows provided by financing activities

(77)

(46)

(4)

－

13

20

23

－

(149)

(66)

97

－

FY 20132Q (Apr. ‐ Sep.)

OthersCash flows used in investing activities

Effect of exchange rate changes oncash and cash equivalents
Net increase in cash and cash
equivalents

Full‐Year

2Q (Apr. ‐ Sep.)

2．Operating Activities (Consolidated)(1) Sales by Equipment
FY 20132Q (Apr. ‐ Sep.)

Full‐Year%%

AmountAudio Visual Equipment
DVD

Change Amount

2Q (Apr. ‐ Sep.)
Change Amount%（Units : 100 million yen, %）FY 2014
Full‐Year (Projections)

Change Amount%

Change

939

77.9

26.0

1,831

78.2

17.6

910

78.6

(3.1)

1,632

80.4

(10.9)

81

6.7

(2.4)

174

7.4

(5.4)

53

4.6

(34.6)

113

5.6(35.1)

BD

75

6.2

31.6

168

7.2

19.1

69

6.0

(8.0)

140

6.9

(16.7)LCD TV

767

63.7

29.1

1,436

61.4

19.8

764

66.0

(0.4)

1,332

65.6

(7.2)

16

1.3

45.5

53

2.2

60.6

24

2.0

50.0

47

2.3

(11.3)

Information Equipment

107

8.9

163.7

189

8.1

57.8

96

8.3

(10.4)

118

5.8(37.5)

Others

159

13.2

52.6

320

13.7

31.6

152

13.1

(4.8)

280

13.8

(12.6)

1,205

100.0

2,340

100.0

1,158

100.0

2,030

100.0

(13.3)

Others

Total

35.4

－2－

21.9

(3.9)

(2) Sales by Areas in Equipment
FY 20132Q (Apr. ‐ Sep.)

Full‐Year%%

AmountAudio Visual Equipment

Change Amount

2Q (Apr. ‐ Sep.)
Change Amount%（Units : 100 million yen, %）FY 2014
Full‐Year (Projections)

Change Amount%

Change

939

77.9

26.0

1,831

78.2

17.6

910

78.6

(3.1)

1,632

80.4

(10.9)

Americas

834

69.2

28.9

1,570

67.1

18.5

807

69.7

(3.2)

1,412

69.6

(10.1)

Europe14

1.1(39.1)

32

1.3(25.6)

13

1.1

(7.1)

35

1.7

9.4

Asia and Others

5

0.4

－

12

0.5

140.0

3

0.3

(40.0)

9

0.4

25.0

86

7.2

14.7

217

9.3

17.9

87

7.5

1.2

176

8.7

(18.9)

107

8.9

163.7

189

8.1

57.8

96

8.3

(10.4)

118

5.8(37.5)

73

6.1

356.3

126

5.3

96.9

67

5.8

(8.2)

87

4.3

(31.0)

Europe

25

2.1

525.0

45

2.0

136.8

22

1.9

(12.0)

24

1.2(46.7)

Asia and Others7

0.6(66.7)

16

0.7(48.4)

6

0.5(14.3)

7

0.3(56.3)

Japan
Information Equipment
Americas

Japan

2

0.1

－

2

0.1

(60.0)

1

0.1(50.0)

0

0.0－

Others

159

13.2

52.6

320

13.7

31.6

152

13.1

(4.8)

280

13.8

(12.6)

Total

1,205

100.0

35.4

2,340

100.0

21.9

1,158

100.0

(3.9)

2,030

100.0

(13.3)(Note)
Effective from FY 2014, sales to Central and South America, which were previously included in the Asia and others , have been included in Americas. The segment
name North America has been changed to Americas.
Figures for FY 2013 have been restated accordingly.

(3) Sales by Equipment in Areas
FY 20132Q (Apr. ‐ Sep.)

Full‐Year%%

AmountAmericas

Change Amount

982

81.5

Audio Visual Equipment

834

Information Equipment

73

OthersEuropeChange Amount

45.1

1,850

79.0

69.2

28.9

1,570

6.1

356.3

126

75

6.2

476.9

39

3.2

44.4

Audio Visual Equipment

14

1.1

Information Equipment

25

Others0Asia and Others

2Q (Apr. ‐ Sep.)%（Units : 100 million yen, %）FY 2014
Full‐Year (Projections)

Change Amount

26.7

950

82.0

67.1

18.5

807

5.3

96.9

67

154

6.6

116.9

76

77

3.3

24.2

35

(39.1)

32

1.3(25.6)

2.1

525.0

45

2.0

0.0

－

0

0.0

%

Change

(3.3)

1,634

80.5

69.7

(3.2)

1,412

69.6

(10.1)

5.8

(8.2)

87

4.3

(31.0)

6.5

1.3

135

6.7

(12.3)

3.0

(9.9)

59

2.9

(23.4)

13

1.1

(7.1)

35

1.7

9.4

136.8

22

1.9

(12.0)

24

1.2(46.7)

－

0

0.0

－

0

0.0

－

(11.7)

14

1.2(36.2)

32

1.4(17.9)

12

1.1(12.5)

19

0.9(40.4)

Audio Visual Equipment

5

0.4

－

12

0.5

140.0

3

0.3

(40.0)

9

0.4

25.0

Information Equipment7

0.6(66.7)

16

0.7(48.4)

6

0.5(14.3)

7

0.3(56.3)

Others

2

0.2

0.0

4

0.2

33.3

3

0.3

50.0

3

0.2

(25.0)

170

14.1

3.7

381

16.3

6.1

161

13.9

(5.6)

318

15.7

(16.5)

Audio Visual Equipment

86

7.2

14.7

217

9.3

17.9

87

7.5

1.2

176

8.7

(18.9)

Information Equipment

2

0.1

－

2

0.1

(60.0)

1

0.1(50.0)

0

0.0

－

Japan

Others
Total

82

6.8

(7.9)

162

6.9

(4.7)

73

6.3

(11.0)

142

7.0(12.3)

1,205

100.0

35.4

2,340

100.0

21.9

1,158

100.0

(3.9)

2,030

100.0

(13.3)(Note)
Effective from FY 2014, sales to Central and South America, which were previously included in the Asia and others , have been included in Americas. The segment
name North America has been changed to Americas.
Figures for FY 2013 have been restated accordingly.

－3－3．Summary of 2Q (July to September) Financial Statements (Consolidated)(1) Operating Results（Units : 100 million yen, %）FY 2013

FY 2014

2Q (Jul. ‐ Sep.)

2Q (Jul. ‐ Sep.)%

AmountChange%AmountChangeNet Sales

700

100.0

42.9

728

100.0

3.8

Operating Income (Loss)

22

3.3

－

34

4.7

50.6

Ordinary Income (Loss)

20

2.9

－

52

7.2

160.9

Net Income (Loss) after Tax

6

0.9

－

49

6.8

685.2

（※） Yen‐Dollars / Exchange rate
（Units : Yen / Dollars）
FY 2013

FY 2014

2Q (Jul. ‐ Sep.)

2Q (Jul. ‐ Sep.)

Average Rate in each Period

98.06

105.34(2) Sales by Equipment（Units : 100 million yen, %）FY 2013

FY 2014

2Q (Jul. ‐ Sep.)

Audio Visual Equipment

2Q (Jul. ‐ Sep.)%

AmountChange%AmountChange

560

80.0

32.1

614

84.3

9.6

DVD

38

5.4

(15.6)

26

3.6(31.6)

BD

33

4.7

73.7

47

6.5

42.4

LCD TV

481

68.7

35.9

528

72.5

9.8

Others

8

1.2

33.3

13

1.8

62.5

Information Equipment

58

8.3

286.7

39

5.4

(32.8)

Others

82

11.7

60.8

75

10.3

(8.5)

Total

700

100.0

42.9

728

100.0

4.0

－4－

（Company）

FUNAI ELECTRIC CO., LTD.
INVESTOR / PUBLIC RELATIONS OFFICE
7-7-1 Nakagaito Daito-city, Osaka 574-0013, JapanTEL 81-72-870-4395 ･ FAX 81-72-870-4613