The following includes questions and answers at the conference for the financial results for the First Quarter of the Year Ending March 31, 2016.
Precision Equipment Business
Q. Are there any changes in your ArF immersion scanner sales forecast for the year ending March 2016 in line with the trend in the reduction of capital expenditures for semiconductors?
A. While we are paying close attention to the trend in CAPEX, we put together our sales forecast based on the nature of individual business negotiations. For the year ending March 2016, as we are planning to sell several 450mm immersion scanners in addition to 300mm ones, we have made no changes to our full-year sales forecast of 12 units at this time.
Q. Can you tell us about your FPD lithography system sales forecast for the year ending March 2016?
A. During the first quarter, we sold one FPD lithography system for small and medium-sized panels and five units for large panels. These results are in line with our initial target for the year. From the second quarter onwards, we anticipate that both demand for these systems and our sales of them will increase, and have made no changes to our full-year sales target of 50 units at this time.
Imaging Products Business
Q. Can you tell us about unit sales of digital cameras and the operating income forecast for the year ending March 2016 of the Imaging Products Business?
A. No changes have been made to our forecast for the year ending March 2016 for either the size of the digital cameras-interchangeable lens type market or the estimated our sales units.
We predict that the size of the digital cameras-interchangeable lens type market will decrease by 9% year-on-year to 12,400 thousands units, and that the size of the interchangeable lenses market will similarly decrease by 9% year-on-year to 20,600 thousands units.
Based on this market forecast, our sales forecast remains at 4,250 thousands units for digital cameras-interchangeable lens type, dropped 8% compared to the previous year, and 6,100 thousands units for interchangeable lenses, a 9% decrease from the previous year, with no change our initial targets for the year.
As we head into the second half of the year, we expect that the decrease in market size will continue to lessen. However, the situation at this time remains unclear. We will continue our activities for increasing sales of middle/high class models and efforts to enhance efficiency by cost improvement, etc. in line with our initial plan for this fiscal year. Taking these circumstances and our results for the first quarter into consideration, we revised our operating profit forecast for the full year ending March 2016 of the Imaging Products Business from our previous forecast of 38 billion yen (decreased 33% on a year-to-year basis) to 42 billion yen (decreased 26% on a year-to-year basis).
Q. Can you tell us about the contribution of Optos Plc to your business results for the year ending March 2016 and the goodwill expenses accompanying the acquisition of that company?
A. At the end of May 2015, we finished acquiring the UK-based Optos Plc, which carries retina diagnostic imaging equipment, and converted it to a wholly-owned subsidiary on schedule. We are currently in the process of the PMI (Post Merger Integration) for making Optos Plc part of our organization, and expect to post earnings from that subsidiary from the second quarter onwards. Accordingly, we plan to post 15 billion yen in net sales and the operating income to net sales is expected to be about 10% from Optos Plc under our consolidated business results for the year ending March 2016, noting that those figures are for three quarters. It should also be noted that the effect of this accounting has already been factored into the results forecast for the year ending March 2016 under our Medical Business. Additionally, we plan on posting approximately 2.6 billion yen in the amortization of goodwill from Optos for the year ending March 2016.
Q. Can you tell us about the fact that you have kept your full-year forecast of net income attributable to owners of the parent company unchanged at 20 billion yen?
A. In the latest forecast, we revised operating income and ordinary income upwards. However, due to the impact of tax effect accounting (largely an additional deferred tax expenses by increase in the surplus of overseas subsidiaries due to the depreciation of yen), we have kept our full-year forecast of net income attributable to owners of the parent company unchanged at 20 billion yen.