OREANDA-NEWS.  Mitsubishi Electric Corporation (TOKYO: 6503) announced today its financial results for the first 9 months and third quarter ended December 31, 2016, of the current fiscal year ending March 31, 2017 (fiscal 2017). 

Consolidated First 9 Months Results (April 1, 2016 – December 31, 2016)

Net sales: 2,947.1 billion yen (5% decrease from the same period last year)
Operating income: 175.5 billion yen (15% decrease from the same period last year)
Income before income taxes: 196.1 billion yen (10% decrease from the same period last year)
Net income attributable to Mitsubishi Electric Corp.: 135.3 billion yen (11% decrease from the same period last year)

In the first 9 months of fiscal 2017, the business environment was buoyed by the expanding U.S. economy and gradual recoveries in Japan and Europe, as well as modest improvement in China’s economic slowdown. In addition, the yen became stronger against foreign currencies compared to the previous year, but weakened after the U.S. presidential election in November.

Under these circumstances, consolidated net sales for the first 9 months of fiscal 2017 decreased by 5% compared to the same period of the previous fiscal year to 2,947.1 billion yen, with decreased sales in the Energy and Electric Systems, Industrial Automation Systems, Information and Communication Systems and Electronic Devices segments. Consolidated operating income decreased by 15% compared to the same period of the previous fiscal year to 175.5 billion yen, due to decreased profits in the Energy and Electric Systems, Industrial Automation Systems and Electronic Devices segments.

Consolidated Financial Results by Business Segment (First 9 months, Fiscal 2017)

Energy and Electric Systems
Total sales: 784.7 billion yen (3% decrease from the same period last year)
Operating income: 13.7 billion yen (4.6 billion yen decrease from the same period last year)

The social infrastructure systems business saw no change in orders, while sales decreased compared to the same period of the previous fiscal year due to decreases in the public utility systems business in Japan as well as the power systems and the transportation systems business outside Japan. In addition, the stronger yen had the negative influences.

The building systems business experienced decreases in both orders and sales compared to the same period of the previous fiscal year, due primarily to negative influences caused by the stronger yen, despite the growth in the renewal business in Japan, as well as the installation business of new elevators and escalators outside Japan.

As a result, total sales for this segment decreased by 3% from the same period of the previous fiscal year. Operating income decreased by 4.6 billion yen from the same period of the previous fiscal year due primarily to a decrease in sales.

Industrial Automation Systems
Total sales: 951.9 billion yen (4% decrease from the same period last year)
Operating income: 102.5 billion yen (24.6 billion yen decrease from the same period last year)

The factory automation systems business saw an increase in orders from the same period of the previous fiscal year primarily due to growth in capital expenditures in the fields of smartphones, electrical cars in China and organic light emitting diodes (OLED) mainly in Korea, while sales decreased from the same period of the previous fiscal year due to decreased capital expenditures in photovoltaic systems in Japan and the negative influences caused by the stronger yen.

The automotive equipment business saw decreases in both orders and sales from the same period of the previous fiscal year due primarily to stagnation in car sales in Japan and the negative influences caused by the stronger yen, despite growth in car sales mainly in Europe.

As a result, total sales for this segment decreased by 4% from the same period of the previous fiscal year. Operating income decreased by 24.6 billion yen from the same period of the previous fiscal year due primarily to a decrease in sales.

Information and Communication Systems
Total sales: 285.4 billion yen (22% decrease from the same period last year)
Operating income: 4.4 billion yen (Unchanged from the same period last year)

The telecommunications equipment business saw decreases in both orders and sales compared to the same period of the previous fiscal year due primarily to the sellout of an affiliated company in the beginning of the fiscal year and decreased sales of communications infrastructure equipment.

The information systems and service business saw a decrease in sales compared to the same period of the previous fiscal year, mainly owing to a decrease in the system integrations business.

The electronic systems business saw decreases in both orders and sales compared to the same period of the previous fiscal year due to a shift in the portfolio of large-scale projects in the space systems business.

As a result, total sales for this segment decreased by 22% compared to the same period of the previous fiscal year. Operating income was unchanged from the same period of the previous fiscal year due primarily to a shift in project portfolios.

Electronic Devices
Total sales: 135.8 billion yen (18% decrease from the same period last year)
Operating income: 5.1 billion yen (13.8 billion yen decrease from the same period last year)

The electronic devices business saw an increase in orders from the same period of the previous fiscal year due to an increase in optical communication devices, while sales decreased by 18% compared to the same period of the previous fiscal year due to a decrease in demand for power modules, along with the negative influences caused by the stronger yen.

As a result, operating income decreased by 13.8 billion yen compared to the same period of the previous fiscal year due primarily to a decrease in sales.

Home Appliances
Total sales: 746.4 billion yen (2% increase from the same period last year)
Operating income: 57.6 billion yen (9.4 billion yen increase from the same period last year)

The home appliances business saw an increase in sales of 2% compared to the same period of the previous fiscal year due to increases in sales of air conditioners in the European, Chinese and North American markets and in sales of residential and industrial air conditioners in Japan, despite the negative influences caused by the stronger yen.

Operating income increased by 9.4 billion yen compared to the same period of the previous fiscal year largely due to an increase in sales.

Others
Total sales: 514.5 billion yen (1% increase from the same period last year)
Operating income: 15.2 billion yen (1.6 billion yen increase from the same period last year)

Sales increased by 1% compared to the same period of the previous fiscal year mainly due to an increase in sales among affiliated companies involved in materials procurement.

Operating income increased by 1.6 billion yen from the same period of the previous fiscal year due primarily to an increase in sales.