Notice of Difference between Full Year Outlook and Actual Results, and Notice of Non-Operating Expenses, Extraordinary Income and Deferred Tax Assets

 

- TOKYO, Japan, April 30, 2014 -

Seiko Epson Corporation (TSE: 6724, "Epson") today announced a difference between its full-year financial results outlook for the year ended March 2014, announced on January 31, and the actual results announced today.

The company also announced it was recording non-operating expenses, extraordinary income and deferred tax assets for the year ended March 2014.

1. Difference between full-year financial results outlook and actual results

(1) Difference between full-year financial results outlook and actual results (April 1, 2013, to March 31, 2014)

(Unit: billion yen, except where stated otherwise)

  Net income Operating
income
Ordinary
income
Net income Net income
per share (yen)
Previous outlook (A) 990.0 79.0 74.0 52.0 290.68
Actual results (B) 1,003.606 84.968 78.121 83.698 467.87
Change (B-A) 13.606 5.968 4.121 31.698 -
Change (%) 1.4 7.6 5.6 61.0 -
Reference:
Previous year
(ended March 2013)
851.297 21.255 17.629 -10.091 -56.41

(2) Reasons for difference

Companywide results exceeded fourth quarter forecasts (January to March). This was partially due to expanded sales for inkjet printer cartridges, including increased demand in Japan before a sales tax hike.

Net income significantly exceeded the previous forecast due to the deferred tax assets mentioned in 2. (3), below.

2. Non-Operating Expenses, Extraordinary Income and Deferred Tax Assets

(1) Non-Operating Expenses (consolidated)
Foreign exchange losses

Epson incurred fourth quarter foreign exchange losses of 3.757 billion yen as non-operating expenses. This was due to the depreciation of local currencies affecting certain Epson overseas sales companies and the impact of foreign exchange fluctuations on related forward-exchange contracts.

(2) Extraordinary income (nonconsolidated)
Reversal of allowance for doubtful accounts

In the light of the financial situation at a consolidated subsidiary company, Epson will record as extraordinary income for the fourth quarter a reversal of allowance for doubtful accounts totaling 13.744 billion yen. The full year total for this item amounts to 10.656 billion yen.

This reversal of allowance for doubtful accounts is eliminated on a consolidated basis and therefore does not impact the consolidated financial results.

(3) Deferred Tax Assets (consolidated, nonconsolidated)

Accompanying a reduction in taxation expenses, Epson has recorded income tax adjustments of -30.734 billion yen on a consolidated and -8.375 billion yen on a nonconsolidated basis. After carefully considering its financial results for the year ended March 2014 and the outlook for the following year, Epson reviewed the prospects for recovering deferred tax assets, and decided to record the part that it considers recoverable as deferred tax assets.


About Epson
Epson is a global innovation leader dedicated to exceeding expectations with solutions for markets as diverse as the office, home, commerce and industry. Epson's lineup ranges from inkjet printers, printing systems and 3LCD projectors to industrial robots, smart glasses and sensing systems and is based on original compact, energy-saving, and high-precision technologies.
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/