Notice of Difference between First Half Outlook and Actual Results, and Revision of Full Year Financial Results Outlook


- TOKYO, Japan, October 31, 2013 -

Seiko Epson Corporation (TSE: 6724, "Epson") today announced a difference between its first half (April 1, 2013, to September 30, 2013) outlook issued on July 31, 2013, and its actual results announced today. The Company also revised its full year (April 1, 2013, to March 31, 2014) financial results outlook.

1. Difference between first half outlook and actual results

(April 1, 2013, to September 30, 2013)

(Unit: billion yen, except where stated otherwise)

  Net sales Operating
income
Ordinary
income
Net income Net income
per share (yen)
Previous
outlook (A)
450.0 13.0 9.0 1.0 5.59
Actual results (B) 468.630 34.037 30.643 18.441 103.09
Change (B-A) 18.630 21.037 21.643 17.441 -
Change (%) 4.1 161.8 240.5 - -
Reference:
Previous year
(ended March 2013)
388.273 -14.142 -14.193 -35.447 -198.15

2. Revised financial results outlook

(April 1, 2013, to March 31, 2014)

(Unit: billion yen, except where stated otherwise)

  Net sales Operating
income
Ordinary
income
Net income Net income
per share (yen)
Previous
outlook (A)
930.0 37.0 33.0 15.0 83.85
Revised outlook (B) 960.0 58.0 55.0 34.0 190.06
Change (B-A) 30.0 21.0 22.0 19.0 -
Change (%) 3.2 56.8 66.7 126.7 -
Reference:
Previous year
(ended March 2013)
851.297 21.255 17.629 -10.091 -56.41

3. Reasons for difference and revision

As shown in table 1 above, Epson in the first half significantly exceeded its previous forecast in each income category. Results in the inkjet printer business were boosted by enhanced hardware profitability due to factors such as an improved model mix and an increase in average selling prices. In developed economies we benefitted from curtailed shipments of low-end models and a strengthened lineup of high-end models, while in emerging economies we built on our success in the first quarter with ongoing steady sales of high-capacity ink tank printers. Net sales of consumables were also stronger than initially forecast. In addition, the weakened yen benefitted income in each operations division, while overall profitability was positively impacted by effective allocation and postponed execution of certain fixed costs, and by income generated from patents.

In consideration of the first half weakness in the yen and ongoing forecasts, we will increase both our US dollar and euro second half exchange rate assumptions by 5 yen to 95 and 125 yen respectively.

We are upwardly revising our full-year forecasts for both net sales and operating income. Although there is continuing uncertainty in Epson's market environment caused by factors such as a downturn in China and other emerging economies, we will achieve our previously announced second half operating income outlook. This is due to the results of our steady efforts in inkjet printers and the other businesses in the information-related equipment segment that form the core part of the Updated SE15 Second-Half Mid-Range Business Plan announced in March this year, and because of the impact of the adjustments to our exchange rate assumptions. On the other hand, we are downwardly revising our second half operating income forecast for the devices & precision products and sensing & industrial solutions segments. This is due to intensified price competition in the microdevices business because of the weakened yen, and because of delays in the rollout of products in new businesses. As a result of these various factors we are standing by our previous second half operating income forecast for the company overall.

In the light of the above, Epson is upwardly revising its full year financial results outlook as shown in table 2 above.


About Epson
Epson is a global innovation leader whose product lineup ranges from inkjet printers and printing systems, 3LCD projectors and industrial robots to sensors and other microdevices. Dedicated to exceeding the vision of its customers worldwide, Epson delivers customer value based on compact, energy-saving, and high-precision technologies in markets spanning enterprise and the home to commerce and industry.
Led by the Japan-based Seiko Epson Corporation, the Epson Group comprises more than 73,000 employees in 94 companies around the world, and is proud of its ongoing contributions to the global environment and the communities in which it operates.
http://global.epson.com/