From April 1, 2013
To December 31, 2013

FUNAI ELECTRIC CO., LTD.

February 3, 2014
Funai Electric Co., Ltd.

Third Quarter (April‐December) Consolidated Financial Summary
for the Period Ending March 2014
(Million yen)Previous Year Third Quarter

Current Year Third Quarter

From April 1, 2012
to Decembr 31, 2012

From April 1, 2013
to December 31, 2013

AmountAmount%%%Net Sales

Rate ofincrease or
decrease%%

147,017100.0

185,506

100.0

26.2

(1,850)

(1.3)

437

0.2

－

142

0.1

4,800

2.6

－

Net Income (Loss) before Taxes
and Other Adjustments(1,277)

(0.9)

2,120

1.1

－

Net Income (Loss) after Tax(2,294)

(1.6)

1,737

0.9

－

Operating Income (Loss)

Ordinary Income

Net Income (Loss) per Share(67.24)50.93

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 9‐Month Period ended December 31, 2013
February 3, 2014

Listed company name:

Funai Electric Co., Ltd.

Securities Code: 6839

Tokyo Stock ExchangeFirst Section(URL http://www.funai.jp/ )Representative: President and CEO
Yoshikazu Uemura
Keichi Ikegami
Inquiries: General Manager, Accounting Department
Scheduled date of Quarterly Report; February 6, 2014
Scheduled date of Commencement of Annual Dividend Payment; －Quarterly Financial Results Supplementation: Yes
Quarterly Financial Results Seminar: Yes

TEL: (072) 870‐4395

1. Third Quarter Consolidated Results for the Period Ending March 2014 (April 1, 2013 – December 31, 2013)(1) Operating Results (Consolidated)(% denotes year on year)
Ordinary Income
Net Income
Net Sales
Operating Income
Million yen%
Million yen %Million yen%
Million yen%
437
185,506
26.2
4,800
1,737
－
－
－
3rd Quarter FY2013(1,850)147,017(27.7)(2,294)142(89.9)－－
3rd Quarter FY2012(Reference) Comprehensive Income 3rd Quarter FY 2013 ended December 31, 2013 7,737 million yen (827.6%)
834 million yen ( － %)3rd Quarter FY 2012 ended December 31, 2012
Net Income Per Shareon a Fully Diluted BasisNet Income
Per Share

Yen

Yen
3rd Quarter FY2013
3rd Quarter FY2012

－
－

50.93
(67.24)(2) Consolidated Financial Position

3rd Quarter FY2013
Fiscal Year 2012
(Reference) Equity

Net Assets
Equity Ratio
Total Assets%
Million yen
Million yen
68.7
127,766
184,40961.7
121,398
194,524
3rd Quarter FY 2013 ended December 31, 2013 126,618 million yen
120,103 million yen
Fiscal Year 2012 ended March 31, 2013

2. Dividends
Dividend per Sharest

1 Quarternd

2 Quarteryen

3rd Quarteryen

Fiscal Year 2012

－

0.00

Fiscal Year 2013

－

0.00

Fiscal Year 2013
(Projection)rdYear‐Endyen

Annual
yen

yen

－

35.00

35.00

－

－

－

(Note) Revision of Annual Dividends Forecast in this 3 Quarter: No
The dividend for FY 2013 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 2014 (April 1, 2013 ‐ March 31, 2014)(% denotes year on year)
Operating
Ordinary
Net Income
Net Sales
Net Income
IncomeIncomePer Share

Full Year

Million yen%

229,000

19.3

Million yen %500－

Million yen %

2,100

－

Million yen %

100

－

Yen

2.93

(Note) Revision of Forecast of Consolidated Results for the 9‐month period or the Full Year in this 3rd Quarter: No*Note(1) Changes in Consolidated Subsidiaries (Changes in Scope of Consolidation): Yes
New Subsidiary : Funai Electric Cebu, Inc.
(2) Application of simplified accounting procedure and use of unique accounting procedure for preparation offinancial statements covering consolidated accounting in this 3rd quarter: Yes(3) Changes in Accounting Practices, Procedures and Presentation Methods for Consolidated Financial Results
1. Changes arising from revision of accounting standards: No
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 December 31, 2013; 36,130,796 shares
as of March 31, 2013; 36,130,796 shares
2. Number of shares of treasury stock as of December 31, 2013; 2,011,615 shares
as of March 31, 2013; 2,011,615 shares
3. The Average number of outstanding shares on December 31, 2013; 34,119,181 shareson December 31, 2012; 34,119,187 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 third quarter of the current fiscal term, the economy of the United States, which is the Funai Group’s
mainstay market, despite improvements job situation slower than expected, almost overall continued to grow mode.
The housing market observations a continuous recovery, and a recovery in personal consumption. The European
economy bottoming out, while the European Central Bank’s responses to the debt crisis to have several
countermeasures. But economic performance in China is seen some slowdown. In Japan, continued modest
recovering after the countermeasures of monetary easing at the Bank of Japan, due to a personal consumption’s
mind and increasing amount of the capital investments.
Within the consumer electronics industry, still under these difficult conditions, despite global shipments of LCD TVs
are seen some growth in the unit basis, still facing struggle due to increasing price competition in the market., while
demand for smartphones and tablet devices has kept grown sharply, in a changing role of the products that are
driving the market.
As a result of the above factors, the Funai Group posted net sales of JPY 185,506 million, a 26.2% increase
compared with the same period last year.
On the profit front, operating income was JPY 437 million (the operating loss for the same period last year was JPY
1,850 million); ordinary income was JPY 4,800 million (the ordinary income for the same period last year was JPY
142 million); and a net income of JPY 1,737 million (the net loss for the same period last year was JPY 2,294 million).
Segment conditions by location were as follows:i) Japan
Sales of information equipment recorded increases in revenues due to printer order increase. In addition, sales
of LCD TVs increased.
As a result, net sales were JPY 41,238 million, an increase of 8.8% year on year. Our segment income (operating
income) was JPY 1,540 million (the operating loss for this segment for the same period last year was JPY 559
million).
ii) North America
Revenues for LCD TVs increased year on year due to strong sales of large size products at a major mass retailer
in addition to strong sales in holiday selling season. Additionally, the PHILIPS branded audio and accessories
products contributed to the sales, and DVD‐related equipment also increased as the result of healthy sales ofBlu‐ray Disc players.
As a result, net sales amounting to JPY 138,263 million, an increase of 31.0% year on year. In the other hand,
our segment loss (operating loss) was JPY 723 million (the operating loss for this segment for the same period
last year was JPY 184 million) due to decrease in profitability of the PHILIPS branded audio and accessories
products.
iii) Asia
The ink cartridges contributed to the sales. As a result, net sales came to JPY 3,548 million, an increase of442.1% year on year. Our segment income (operating income) was JPY 551 million, an increase of 9.1% year onyear.
iv) Europe
Sales of LCD TVs declined due to sluggish market conditions. As a result, net sales down 15.3% year on year, to
JPY 2,456 million, and an segment loss (operating loss) of JPY 358 million (operating loss for the same period
last year was JPY 202 million).

Sales by product segment were as follows:i) Audiovisual Equipment
In the audiovisual equipment sector, sales of LCD TVs increased revenue because of strong sales in holiday
selling season. Sales of DVD‐related equipment also increased year on year due to revenue growth of Blu‐ray
Disc players.
As a result, net sales of this equipment were JPY 145,658 million, an increase of 20.3% year on year.
ii) Information Equipment
In the information equipment sector, sales of printer increased due to increase in orders and ink cartridges
contributed to the sales.
As a result, net sales of JPY 14,819 million, an increase of 96.1% year on year.

iii) Other Products
Net sales were JPY 25,027 million, an increase of 35.8% year on year due to contribution of the audio
accessories products in North America.
(2) Qualitative Information Relating to Consolidated Financial Position
Our financial position at the end of first quarter is described below.
Total assets decreased by JPY 10,114 million as compared to the end of the previous consolidated fiscal year. Thiswas mainly due to a decrease of JPY 23,035 million and JPY 5,302 million in cash and deposits, raw materials andsupplies, and an increase of JPY 12,140 million and JPY 6,074 million in notes and accounts receivable‐trade,tangible fixed asset.
Total liabilities decreased by JPY 16,482 million as compared to the end of the previous consolidated fiscal year.
This was mainly due to a decrease of JPY 13,053 million and JPY 6,441 million in notes and accounts payable‐trade,short‐term loans payable, and an increase of JPY 1,050 million in long‐term loans payable.
Net assets increased by JPY 6,367 million as compared to the end of the previous consolidated fiscal year. This was
mainly due to an increase of JPY 5,565 million and JPY 543 million in the foreign currency translation adjustment
account, retained earnings.
(3) Qualitative Information Relating to Consolidated Performance Forecasts:
We have not revised its consolidated operating results forecast released on November 11, 2013.
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, andinvolves known and unknown risks and uncertainties. Various factors such as changes in economic conditions
overseas, especially in the main U.S. market, and severe price fluctuations may cause actual events andresults to differ materially from those anticipated in these statements.
2. Summary Information(1) Important changes relating to subsidiaries and affiliates during the fiscal term
The newly‐established Funai Electric Philippines Inc. has also been included within the scope of consolidation in thefirst quarter. In addition, we acquired all shares of manufacturing subsidiary where manufactures inkjet
printer‐related products located in Philippines from Lexmark International, Inc. And the newly‐established Funai
Electric Cebu, Inc. has also been included within the scope of consolidation.
(2) 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 theapplication of the tax effect accounting for before‐tax net profits of the consolidated fiscal year, including thisthird fiscal quarter.
(3) Additional Information
About Anti‐Tax Haven Law
1. The Funai Group received a rectification notices from the Osaka Regional Taxation Bureau on June 28, 2005, andJune 16, 2008. 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, 2002 through 2004, and the three years from March 31, 2005 through 2007, will be considered, andtaxed as, our income. We objected to this supplementary tax assessment, and filed petitions seeking a review ofthe decision with the Osaka Regional Tax Tribunal on July 25, 2006, and August 6, 2008. On July 3, 2008, and July23, 2009, we received written verdicts on this case from the Administrative Review Office of the Osaka Regional
Taxation Bureau, which indicated that our assertions had been dismissed. On November 16, 2006 and November
14, 2008, the Company filed suits in the Osaka District Court to overturn the supplementary tax assessment orders,and a hearing for consolidation of those actions was filed on November 26, 2008. The court dismissed the claimsof our Company on June 24, 2011. As the Company is unable to accept the Osaka District Court’s judgment, wefiled a notice of appeal at the Osaka Superior Court on July 7, 2011. With respect to this action, on July 20, 2012,
the court dismissed the claims of the Company. In response to this judgment, the company will promptly examine
the contents of the judgment. We intend to appeal this matter with the High Court.
The additional taxes of JPY 16,651 million (JPY 19,184 million including incidental taxes) and JPY 15,038 million(JPY 16,838 million including incidental taxes) include corporate, enterprise and residence taxes. In accordancewith the “Accounting Practices, Disclosure and Audit Treatment for Various Taxes” (Japanese Institute of Certified
Public Accountants, Auditing and Assurance Practice Committee, Audit Committee Report No. 63) we charged thetax assessments to income as “prior year’s taxes” in the fiscal year ended March 31, 2007, and the fiscal year
ended March 31, 2009.

2.

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 theanti‐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 a petition 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 ourassertions 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, enterpriseand residence taxes. We charged the tax assessments to income as “prior year’s taxes” in the fiscal year ended
March 31, 2012.

3.

With regard to the actions The Funai Group filed with the Osaka District Court on June 28, 2005, and June 16,
2008, seeking the rescission of supplementary tax assessments, on June 24, 2011, a decision was reached in which
the court dismissed the claims of the Company. Accordingly, we treated this amount as an expense during the
fiscal year under review, which is the fiscal year ended March 31, 2012 following the year to which the assessment
was applied.

3. Consolidated Financial Statements(1) Consolidated Quarterly Balance Sheets(Units : Million Yen)
Fiscal year 2012
(As of March 31, 2013)

3rd Quarter FY2013(As of December 31, 2013)ASSETS;
Current Assets
Cash and deposits

67,81344,778Notes and accounts receivable‐trade33,19345,334Merchandise and finished goods

34,54731,329Work in process

2,095

1,641

Raw materials and supplies

18,997

13,695

Other

8,332

9,009

Allowance for doubtful accounts

(178)

(189)

164,802145,598

Tangible fixed assets

16,67522,749Intangible fixed assets

3,107

6,832

10,131

9,430

Allowance for doubtful accounts

(192)

(201)

Total investments and other assets

9,938

9,228

Total current assets
Fixed assets

Investment and other assets
Other

Total noncurrent assets

29,721

38,810

194,524

184,409

Notes and accounts payable‐trade39,17826,125

Short‐term loans payable

12,981

6,539

Income taxes payable

1,690

670

Provision

1,188

1,164

Other

14,412

17,145

Total current liabilities

69,452

51,645－

1,050

Provision

2,008

2,116

Other

1,663

1,830

Total noncurrent liabilities

3,672

4,997

73,12556,643TOTAL ASSETSLIABILITIES;Current Liabilities

Noncurrent liabilities
Long‐term loans payable

TOTAL LIABILITIESFiscal year 2012
(As of March 31, 2013)

3rd Quarter FY2013(As of December 31, 2013)

NET ASSETS;
Shareholders' equity
Capital stock

31,30731,307

Capital surplus

33,27233,272Retained earnings

101,135

101,679

Treasury stock(24,341)(24,341)

Total shareholders' equity

141,374

141,918451

709(21,722)(16,157)－

148(21,271)(15,299)

122

129

1,173

1,017

121,398

127,766

194,524

184,409

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

Foreign currency translation adjestment
Post retirement liability adjustment for foreign companies

Total accumulated other comprehensive income
Subscription right 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)
3rd Quarter FY2012

3rd Quarter FY2013( from April 1, 2012
to December 31, 2012)( from April 1, 2013
to December 31, 2013)

Net sales

147,017

185,506

Cost of sales

122,721

156,884

Gross profit

24,29528,622

Selling, general and administrative expenses

26,14628,184

Operating income (loss)(1,850)437

Interest income

213

95

Dividends income

35

39

1,749

4,776

265

112

2,265

5,023

Interest expenses

62

146

Equity in losses of affiliates

23

89

Payment compensation cost－

300

Penalty

68

－

Other

116

124

Total non‐operating expenses

271

660

142

4,800

341

0

Gain on negative goodwill

－

8

Other

－

0

341

9

62

81

1,614

－

Non‐operating income

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

Ordinary income (loss)
Extraordinary income
Gain on disposal of noncurrent assets

Total extraordinary income
Extraordinary loss
Loss on disposal of fixed assets
Impairment loss
Expenses incurred on business restructuring－

Advisory fees

－

1,166

Other

84

142

1,761

2,689

(1,277)

2,120

73

356

922

－

995

356

(2,273)

1,763

20

25

(2,294)

1,737

Total extraordinary loss
Income (loss) before income taxes
Income taxes
Income taxes for prior periods
Total income taxes
Income (loss) before minority interests
Minority interests in income
Net income (loss)

*2

*1

1,297

(Consolidated Quarterly Statement of Comprehensive Income)

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

3rd Quarter FY2012

3rd Quarter FY2013( from April 1, 2012
to December 31, 2012)( from April 1, 2013
to December 31, 2013)(2,273)

1,763

55

260

3,053

5,525

Post retirement liability adjustment for foreign companie－

148

Share of other comprehensive income of associates
accounted for using equity method

(2)

39

3,107

5,974

834

7,737

Comprehensive income attributable to owners of parent

801

7,709

Comprehensive income attributable to minority interests

33

28

Other comprehensive Income
Valuation difference on avaiable‐for‐sale securities
Foreign currency translation adjestment

Total other comprehensive Income
Comprehensive income(Breakdown)(3) Notes of Consolidated Quarterly Financial Statements(Notes for Continuing Enterprises)
Not Applicable(Notes of remarkable changes in Shareholders Equity)
Not Applicable(Consolidated quarterly balance sheets)
Third Quarter Consolidated Fiscal Period (As of December 31, 2013)
Contingent liabilities
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.
The results of these arbitral proceedings may affect the Funai Group’s operating performance, but given the difficultyof making a rational estimate of this impact during this third quarter consolidated fiscal period, such impact has notbeen 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 : A specific claimed amount has not been stipulated
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 : A specific claimed amount has not been stipulated
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
In September 2008, Funai entered into a brand licensing agreement maintaining responsibility for the sourcing,
distribution, marketing and sales activities of PHILIPS consumer televisions in the United States and Canada. Following
this, in July 2012 Funai entered an agreement with PHILIPS involving the sale in the United States, Canada and Mexicoof products that PHILIPS designed and developed through the operation.
Funai has positioned the "strengthening and expanding existing businesses," "making forays into new markets" and"developing new businesses" as the three pillars of its growth strategy. To achieve this growth strategy, in addition toreinforcing existing management resources Funai has searched for growth opportunities through business alliances and
M&A activities with other companies such as those outlined above.
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)*1. Expenses incurred on business restructuring stem
Third Quarter Consolidated Fiscal Period – Year to Date (April 1, 2013 to December 31, 2013)
Expenses incurred on business restructuring stem mainly from costs incurred due to the shrinking of theoverseas 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.
* 2. Income taxes for prior periods
Third Quarter Consolidated Fiscal Period – Year to Date (April 1, 2012 to December 31, 2012)
A consolidated subsidiary, FUNAI EUROPE GmbH, is under investigation by the German tax authorities with regard totransfer pricing taxation on transactions with FUNAI ELECTRIC EUROPE Sp.z o.o., which is also a consolidated
subsidiary. During the first nine months, we posted a “income taxes for prior periods” based on the anticipatedadditional tax amount, based on the belief that a request for correction by the German tax authorities wasincreasingly likely under the transfer pricing taxation scheme.

(Information by Segment)[Segment Information]
Ⅰ. Third Quarter Consolidated Fiscal Period – Year to Date (April 1, 2012 to December 31, 2012)
1. Information Regarding Net Sales and Profit/Loss Conditions by Reporting Segment(Units: Million Yen)
Total

Adjustments Consolidated(Note 1)
(Note 2)2,899
0147,017
210,411－(210,411)

147,017－

120,475

2,899

357,428(210,411)

147,017

551

(202)

(440)

(1,410)(1,850)Japan

N. America

Asia

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

37,890103,851

105,573
0

3,548
116,927

Total

141,742

105,573

(559)

(184)

Segment Income (Loss)

EuropeNote:1) JPY ‐1,410 million adjustment amount under segment loss includes items such as the JPY 13 million relating to
the cancellation of inter‐segment transactions, JPY ‐647 million of overall Group expenses that are notapportioned to each reporting segment, and the JPY ‐776million negative adjustment relating to inventory assets.
Overall Group expenses are comprised of general administrative expenses that do not belong to a specificreporting segment.
2) Segment loss has been adjusted to operating loss noted on the third quarter consolidated income statement.
2. Information on Impairment Losses Relating to Fixed Assets and Goodwill by Reporting Segment(Impairment Losses on Fixed Assets)
In the Japan segment, we revised its production model in line with decreasing global demand. As a result, werevalued its licensing of patents based on their expected future degree of use, thereby reducing the expectedamount collectible for these assets by JPY 1,614 million. This impairment loss was recorded as an extraordinary loss.

Ⅱ. Third Quarter Consolidated Fiscal Period – Year to Date (April 1, 2013 to December 31, 2013)
1. Information Regarding Net Sales and Profit/Loss Conditions by Reporting Segment(Units: Million Yen)
Total

Adjustments Consolidated(Note 1)
(Note 2)2,456
0185,506
226,304－(226,304)

185,506－

120,475

2,456

411,811(226,304)

185,506

551

(358)

1,010

(573)

437

Japan

N. America

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

41,238109,376

138,263
02,126
83,207

Total

150,615

138,263

1,540

(723)

Segment Income (Loss)

Asia

EuropeNote:1) JPY ‐573 million adjustment amount under segment income includes items such as the JPY 15 million relating to
the cancellation of inter‐segment transactions, JPY ‐612 million of overall Group expenses that are notapportioned to each reporting segment, and the JPY 24 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 third quarter consolidated income
statement.
2. Information on Impairment Losses Relating to Fixed Assets and Goodwill by Reporting Segment(Impairment Losses on Fixed Assets)
In the Asia segment, as part of our business restructuring efforts we have pared down the LED business, writing
down the recoverable value of related assets to their book value and writing off these impairment losses as
expenses incurred on business restructuring, posting them as an extraordinary loss. During the nine months of the
fiscal year, we recorded impairment losses of JPY 389 million.

from 2013.4.1
to 2013.12.31
Page
1. Summary of 3Q (April to December) 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 3Q (October to December)Financial Statements(Consolidated)(1) Operating Results ･･････････････････････････････････････････････････

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

4

１．Summary of 3Q (April to December) Financial Statements (Consolidated)(1) Operating Results, Financial Conditions
FY 2012Net Sales（Units : 100 million yen, %）FY 2013
Full‐Year (Projections)

3Q (Apr. ‐ Dec.)

Full‐Year

Amount

%

%

1,470

100.0

(27.7)

1,920

100.0

(22.0)

1,855

100.0

26.2

2,290

100.0

19.3

(18)

(1.3)

－

(52)

(2.7)

－

4

0.2

－

5

0.2

－

Operating Income (Loss)

Change Amount

3Q (Apr. ‐ Dec.)
Change Amount%%

Change Amount

ChangeOrdinary Income (Loss)1

0.1(89.9)

(3)

(0.2)

－

48

2.6

－

21

0.9

－

Net Income (Loss) after Tax

(22)

(1.6)

－

(85)

(4.4)

－

17

0.9

－

1

0.0

－

Total Assets

1,796

－

－

1,945

－

－

1,844

－

－

－

－

－

Net Assets

1,231

－

－

1,213

－

－

1,277

－

－

－

－

－

（※） Yen‐Dollars / Exchange rate
（Units : Yen / Dollars）
FY 2012FY 2013

3Q (Apr. ‐ Dec.)
Average Rate in each Period

Full‐Year
80.23

3Q (Apr. ‐ Dec.)
83.32

Full‐Year (Projections)
97.32

99.80

(2) Profitability and Per Share Data etc.
FY 2012FY 2013
14.9

15.4

Full‐Year (Projections)
16.2

(1.3)

(2.7)

0.2

0.2

0.1

(0.2)

2.6

0.9

（％）

16.5

Operating Income Ratio （％）

Ordinary Income Ratio （％）

Gross Profit Ratio

Shareholders' Equity Ratio （％）

3Q (Apr. ‐ Dec.)

Full‐Year

3Q (Apr. ‐ Dec.)

67.8

61.7

68.7

－

3,520.11

3,711.08－

Net Assets Per Share（yen）

3,571.51

Net Income Per Share（yen）(67.24)(250.38)

50.93

2.93

Return on Assets

（％）

(1.3)

(4.6)

1.0

－

Return on Shareholders' Equity （％）

(1.9)

(7.0)

1.4

－

(3) Capital Expenditures, Depreciation, R&D Expenses
FY 2012Full‐Year

3Q (Apr. ‐ Dec.)
AmountChange－28

Capital Expenditures

Amount3Q (Apr. ‐ Dec.)

Change53

AmountChange99

32.5

AmountChange122

253.6

FY 2012130.2

FY 2013

3Q (Apr. ‐ Dec.)

Full‐Year%%

Amount（Units : 100 million yen, %）FY 2013
Full‐Year (Projections)

Change Amount

3Q (Apr. ‐ Dec.)

Full‐Year (Projections)%%

Change Amount

Change Amount

ChangeDepreciation Expenses

29

2.0

(19.4)

40

2.1(18.4)

39

2.1

34.5

60

2.6

50.0

R&D

69

4.7

(12.7)

93

4.8(11.4)

64

3.5

(7.2)

93

4.1

－

－1－

(4) CashFlow（Units : 100 million yen）
FY 2013

FY 20123Q (Apr. ‐ Dec.)

Full‐Year

3Q (Apr. ‐ Dec.)

Full‐Year (Projections)

Cash flows provided by operating activities

(69)

(80)

(49)

－

Income Before Income Taxes

(12)

(25)

21

－

Depreciation Expenses

40

52

48

－

Others

－

(97)

(107)

(118)

Cash flows used in investing activities

(53)

128

(13)

－

Free cash flows

(122)

48

(62)

－

Cash flows provided by financing activities

(26)

51

(76)

－

7

36

34

－

(141)

136

(105)

－

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

2．Operating Activities (Consolidated)(1) Sales by Equipment
FY 20123Q (Apr. ‐ Dec.)

Full‐Year%%

AmountAudio Visual Equipment

Change Amount

3Q (Apr. ‐ Dec.)
Change Amount%（Units : 100 million yen, %）FY 2013
Full‐Year (Projections)

Change Amount%

Change

1,211

82.3

(19.9)

1,557

81.1

(15.2)

1,457

78.5

20.3

1,766

77.1

13.4

DVD

143

9.7

(22.7)

184

9.6(16.0)

137

7.4

(4.2)

158

6.9

(14.1)

BD

107

7.3

(65.9)

1417.3(62.9)

119

6.4

11.2

162

7.1

14.9

LCD TV

934

63.5

(5.7)

1,199

62.5

(0.8)

1,164

62.7

24.6

1,396

60.9

16.4

Others

27

1.8

22.7

33

1.7

22.2

37

2.0

37.0

50

2.2

51.5

Information

Equipment

75

5.2(70.0)

119

6.2(60.1)

148

8.0

96.1

185

8.1

55.5

Others184

12.5(32.3)

244

12.7(25.3)

250

13.5

35.8

339

14.8

38.9

Total

1,470

100.0

(27.7)

1,920

100.0

(22.0)

1,855

100.0

26.2

2,290

100.0

19.3

－2－

(2) Sales by Areas in Equipment

FY 20123Q (Apr. ‐ Dec.)

Full‐Year%%

AmountAudio Visual Equipment

Change Amount

3Q (Apr. ‐ Dec.)
Change Amount%（Units : 100 million yen, %）FY 2013
Full‐Year (Projections)

Change Amount%

Change

1,211

82.3

(19.9)

1,557

81.1

(15.2)

1,457

78.5

20.3

1,766

77.1

13.4

North America

978

66.5

(2.5)

1,213

63.2

(0.7)

1,147

61.8

17.3

1,326

57.9

9.3

Europe38

2.5(33.3)

43

2.2(35.8)

25

1.3(34.2)

28

1.2(34.9)

Asia and Others

60

4.1

160.9

117

6.1

172.1

145

7.8

141.7

237

10.4

102.6

Japan

135

9.2

(68.5)

184

9.6(63.4)

140

7.6

3.7

175

7.6

(4.9)

75

5.2

(70.0)

119

6.2(60.1)

148

8.0

96.1

185

8.1

55.5

36

2.5

(57.6)

53

2.8(48.5)

85

4.6

136.1

113

4.9

113.2

Europe80.6(84.3)

19

1.0(67.8)

35

1.9

337.5

45

2.0

136.8

Asia and Others

31

2.1

(71.6)

42

2.2(67.9)

26

1.4(16.1)

24

1.0(42.9)

Information Equipment
North America

Japan

0

0.0

－

5

0.2

(28.6)

2

0.1

－

3

0.2

(40.0)

Others184

12.5(32.3)

244

12.7(25.3)

250

13.5

35.8

339

14.8

38.9

Total

1,470

100.0

(27.7)

1,920

100.0

(22.0)

1,855

100.0

26.2

2,290

100.0

19.3

(3) Sales by Equipment in Areas

FY 20123Q (Apr. ‐ Dec.)

Full‐Year%%

AmountNorth America

Change Amount

1,065

72.5

Audio Visual Equipment

978

Information Equipment

36

OthersEurope3Q (Apr. ‐ Dec.)
Change Amount

(3.5)

1,333

69.4

66.5

(2.5)

1,213

2.5

(57.6)

53

51

3.5

240.0

%

（Units : 100 million yen, %）FY 2013
Full‐Year (Projections)

Change Amount

(0.6)

1,347

72.6

63.2

(0.7)

1,147

2.8

(48.5)

85

67

3.4

318.8

%

Change

26.4

1,590

69.4

61.8

17.3

1,326

57.9

9.3

4.6

136.1

113

4.9

113.2

115

6.2

125.5

151

6.6

125.4

19.3

46

3.1

(57.1)

62

3.2(50.8)

60

3.2

29.1

73

3.2

17.7

Audio Visual Equipment

38

2.5

(33.3)

43

2.2(35.8)

25

1.3(34.2)

28

1.2(34.9)

Information Equipment

8

0.6(84.3)

19

1.0(67.8)

35

1.9

337.5

45

2.0

136.8

Others

0

0.0

－

0

0.0

－

0

0.0

－

0

0.0

－

93

6.3

(32.6)

166

8.7

(8.3)

184

9.9

97.8

286

12.5

72.3

Asia and Others
Audio Visual Equipment

60

4.1

160.9

117

6.1

172.1

145

7.8

141.7

237

10.4

102.6

Information Equipment

31

2.1

(71.6)

42

2.2(67.9)

26

1.4(16.1)

24

1.0(42.9)

OthersJapan
Audio Visual Equipment
Information Equipment
Others
Total

2

0.1

(66.7)

7

0.4

－

13

0.7

550.0

25

1.1

257.1

266

18.1

(61.2)

359

18.7(55.9)

264

14.3

(0.6)

341

14.9

(5.0)

135

9.2

(68.5)

184

9.6(63.4)

140

7.6

3.7

175

7.6

(4.9)

0

0.0

－

5

0.2

(28.6)

2

0.1

－

3

0.2

(40.0)

131

8.9(47.8)

170

8.9(43.9)

122

6.6

(6.9)

163

7.1

(4.1)

1,470

100.0

(27.7)

1,920

100.0

(22.0)

1,855

100.0

26.2

2,290

100.0

19.3

－3－

3．Summary of 3Q (October to December) Financial Statements (Consolidated)(1) Operating Results（Units : 100 million yen, %）FY 2012FY 2013

3Q (Oct. ‐ Dec.)

3Q (Oct. ‐ Dec.)%

AmountChange%AmountChange

580

100.0

(7.6)

650

100.0

12.1

Operating Income (Loss)

(3)

(0.7)

－

(1)

(0.2)

－

Ordinary Income (Loss)

32

5.5

300.0

26

4.1

(18.8)Net Income (Loss) after Tax

6

1.2

－

11

1.7

83.3

Net Sales（※） Yen‐Dollars / Exchange rate
（Units : Yen / Dollars）
FY 2012FY 2013

3Q (Oct. ‐ Dec.)

3Q (Oct. ‐ Dec.)

Average Rate in each Period

82.78

102.10(2) Sales by Equipment（Units : 100 million yen, %）FY 2012FY 2013

3Q (Oct. ‐ Dec.)

Audio Visual Equipment

3Q (Oct. ‐ Dec.)%

AmountChange%AmountChange

466

80.3

(6.8)

518

79.7

11.2

DVD

60

10.3

(1.6)

56

8.6

(6.7)

BD

50

8.6

(46.8)

44

6.8(12.0)LCD TV

340

58.6

1.8

397

61.1

16.8

Others

16

2.8

45.5

21

3.2

31.3

34

5.9

(50.7)

41

6.3

20.6

Others

80

13.8

35.6

91

14.0

13.8

Total

580

100.0

(7.6)

650

100.0

12.1

Information

Equipment－4－

(Company)

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