80Th Term Interim Business Report April 1, 2019 September 30, 2019 Greeting
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Stock Code 7408 To Our Shareholders The 80th Term Interim Business Report April 1, 2019 September 30, 2019 Greeting Apology for the Quality-related Incidents Overview of 1st Half FY2019 Performance affected products will recommence in the third Financial Highlights We conducted a thorough, Group-wide investigation The passenger airline industry is characterized by quarter and we expect sales to come in slightly after the discovery of an incident of improper ongoing intensifying competition from low-cost above the target for consolidated sales issued on Net sales (Millions of Yen) Total assets and Net assets (Millions of Yen) inspection procedures at a factory producing our carriers (LCCs) amid growing worldwide demand for May 10, 2019. 92,600 Total assets Net assets 100,000 91,561 (Full-year Forecast) 120,000 108,797 aircraft interiors and aircraft seat products. Following air travel. Major airlines are launching strategies Profits will be impacted by the additional costs 81,834 84,068 102,980 77,791 100,000 92,284 92,559 94,456 the findings that additional improper quality-related ranging from securing new flight routes and associated with the quality incidents, increased labor 80,000 80,000 incidents occurred at a certified facility of the Aircraft enhancing passenger cabin service to even entering and shipping costs associated with making up for 60,000 60,000 Interiors Business, the Company received a Business into LCC business. the delayed deliveries, and costs to transfer 40,000 40,554 40,000 28,202 28,003 29,553 30,715 30,045 20,000 Improvement Advisory from the Ministry of Land, Aircraft manufacturers are facing some concern production to other sites due to interruptions in 20,000 Infrastructure, Transport and Tourism (MLIT) on of an impact from the grounding of the Boeing 737 production operations. Profits will also be affected by 0 0 76th Term 77th Term 78th Term 79th Term 80th Term 76th Term 77th Term 78th Term 79th Term 80th Term August 20, and immediately formulated and Max aircraft. However, we anticipate an ongoing the losses incurred in the first half and an increased (FY 2015) (FY 2016) (FY 2017) (FY 2018) (FY 2019) (FY 2015) (FY 2016) (FY 2017) (FY 2018) (FY 2019) 1st Half 1st Half launched procedures to rectify the situation. On brisk market for aircraft in the medium and long provision for loss on construction contracts due to November 12, we submitted an action report to term supported by the high number of backorders higher costs for some programs. Based on these Operating income and Ordinary income (Millions of Yen) Equity ratio (%) MLIT including the findings of our investigation of at both Boeing and Airbus, plans to increase factors, the Company is lowering its forecast for Operating income Ordinary income 10,000 35 the causes and circumstances for the incidents along production of some models, and development of consolidated earnings for the full year. 8,793 8,245 30.4 8,000 29.7 29.4 29.3 with preventive measures. new models with greater fuel efficiency. The foreign exchange rate assumption for the 30 27.1 The JAMCO Group sincerely apologizes for any Under these conditions, the results in the first third quarter forward is ¥105 to the U.S. dollar. 6,000 2,900 (Full-year Forecast) inconvenience and concern caused to our half of fiscal year 2019 were consolidated net sales of As per the initial plan, the Company did not 4,466 4,321 25 4,000 3,504 2,200 3,290 (Full-year Forecast) stakeholders. ¥40,554 million (up ¥200 million from the same distribute interim dividends. While the year-end 2,132 20 2,000 Corporate Philosophy 1,285 784 We have implemented specific measures to period in the previous fiscal year), operating income dividend distribution is subject to the earnings 384 0 0 prevent recurrence of the quality issues that were of ¥784 million (down ¥1,368 million), ordinary results at the end of the fiscal year, the Company has 76th Term 77th Term 78th Term 79th Term 80th Term 76th Term 77th Term 78th Term 79th Term 80th Term The JAMCO Commitment (FY 2015) (FY 2016) (FY 2017) (FY 2018) (FY 2019) (FY 2015) (FY 2016) (FY 2017) (FY 2018) (FY 2019) the subject of the Group-wide investigation and income of ¥384 million (down ¥2,010 million) and temporarily adjusted the year-end dividend 1st Half 1st Half JAMCO, a Technology Oriented have also fortified measures to prevent improper net income attributable to shareholders of parent distribution from the initial ¥25 per share to ¥20 per activities in the future at all facilities, including company of ¥73 million (down ¥1,357 million). share in line with the downward revision to the Net income attributable to shareholders of (Millions of Yen) Dividend payment per share and Dividend payout ratio Company with Samurai Values parent company non-certified facilities and related companies. In consolidated results forecast. Dividend payment per share (¥) Dividend payout ratio (%) 6,000 41.3 Rising to the eternal challenge to realize 5,169 (Full-year Forecast) addition, we are radically revising our safety Future Outlook We appreciate the understanding of our 5,000 our aspirations. 31.9 management and business execution systems and The Company’s consolidated earnings forecast for shareholders. 4,000 28.1 Bringing joy and satisfaction to our customers 26.4 and employees. are implementing a companywide effort to rebuild the fiscal year ending March 31, 2020, includes the 3,000 20.8 1,910 our company culture fully dedicated to quality and decline in sales in the first half as shipments of some Harutoshi Okita 2,000 1,681 1,300 40 Striving for coexistence with nature, contributing (Full-year Forecast) 20 1,014 (Full-year Forecast) to a prosperous and progressive society. compliance. The Jamco Group is committed to products were delayed while management President & CEO 1,000 20 20 10 73 making every effort to regain stakeholder trust. responded to the quality incidents. Shipments of the 0 76th Term 77th Term 78th Term 79th Term 80th Term 76th Term 77th Term 78th Term 79th Term 80th Term (FY 2015) (FY 2016) (FY 2017) (FY 2018) (FY 2019) (FY 2015) (FY 2016) (FY 2017) (FY 2018) (FY 2019) 1st Half 1st Half 1 The 80th Term Interim Business Report The 80th Term Interim Business Report 2 Greeting Apology for the Quality-related Incidents Overview of 1st Half FY2019 Performance affected products will recommence in the third Financial Highlights We conducted a thorough, Group-wide investigation The passenger airline industry is characterized by quarter and we expect sales to come in slightly after the discovery of an incident of improper ongoing intensifying competition from low-cost above the target for consolidated sales issued on Net sales (Millions of Yen) Total assets and Net assets (Millions of Yen) inspection procedures at a factory producing our carriers (LCCs) amid growing worldwide demand for May 10, 2019. 92,600 Total assets Net assets 100,000 91,561 (Full-year Forecast) 120,000 108,797 aircraft interiors and aircraft seat products. Following air travel. Major airlines are launching strategies Profits will be impacted by the additional costs 81,834 84,068 102,980 77,791 100,000 92,284 92,559 94,456 the findings that additional improper quality-related ranging from securing new flight routes and associated with the quality incidents, increased labor 80,000 80,000 incidents occurred at a certified facility of the Aircraft enhancing passenger cabin service to even entering and shipping costs associated with making up for 60,000 60,000 Interiors Business, the Company received a Business into LCC business. the delayed deliveries, and costs to transfer 40,000 40,554 40,000 28,202 28,003 29,553 30,715 30,045 20,000 Improvement Advisory from the Ministry of Land, Aircraft manufacturers are facing some concern production to other sites due to interruptions in 20,000 Infrastructure, Transport and Tourism (MLIT) on of an impact from the grounding of the Boeing 737 production operations. Profits will also be affected by 0 0 76th Term 77th Term 78th Term 79th Term 80th Term 76th Term 77th Term 78th Term 79th Term 80th Term August 20, and immediately formulated and Max aircraft. However, we anticipate an ongoing the losses incurred in the first half and an increased (FY 2015) (FY 2016) (FY 2017) (FY 2018) (FY 2019) (FY 2015) (FY 2016) (FY 2017) (FY 2018) (FY 2019) 1st Half 1st Half launched procedures to rectify the situation. On brisk market for aircraft in the medium and long provision for loss on construction contracts due to November 12, we submitted an action report to term supported by the high number of backorders higher costs for some programs. Based on these Operating income and Ordinary income (Millions of Yen) Equity ratio (%) MLIT including the findings of our investigation of at both Boeing and Airbus, plans to increase factors, the Company is lowering its forecast for Operating income Ordinary income 10,000 35 the causes and circumstances for the incidents along production of some models, and development of consolidated earnings for the full year. 8,793 8,245 30.4 8,000 29.7 29.4 29.3 with preventive measures. new models with greater fuel efficiency. The foreign exchange rate assumption for the 30 27.1 The JAMCO Group sincerely apologizes for any Under these conditions, the results in the first third quarter forward is ¥105 to the U.S. dollar. 6,000 2,900 (Full-year Forecast) inconvenience and concern caused to our half of fiscal year 2019 were consolidated net sales of As per the initial plan, the Company did not 4,466 4,321 25 4,000 3,504 2,200 3,290 (Full-year Forecast) stakeholders.