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Presentations & Events

FY2008

- ended March 2009 (For 170th Fiscal Period)

Presentation for FY2008 Q1 Results

For 1st Quarter ended June, 2008   - July 29, 2008

Outline of the presentation

1. Consolidated results for the first quarter of FY2008

Net Sales 1,618.7 billion yen (-45.9 billion yen YoY)
Operating income -24.2 billion yen (-45.4 billion yen YoY)
Income before income taxes and minority interest -16.4 billion yen (-50.4 billion yen YoY)
Net income -11.6 billion yen (-32.2 billion yen YoY)
  • Toshiba's overall consolidated sales were 1,618.7 billion yen, a decrease of 45.9 billion yen that was influenced by sharp yen appreciation against the dollar and steep declines in semiconductor sales prices.
  • Consolidated operating income (loss) worsened by 45.4 billion yen to -24.2 billion yen. While Digital Products moved into the black and Social Infrastructure posted a solid performance, Electronic Devices, particularly the Semiconductor business, saw significantly lower operating income.
  • Income (loss) before income taxes and minority interest worsened by 50.4 billion yen to -16.4 billion yen and net income (loss) worsened by 32.2 billion yen to -11.6 billion yen.

2. Financial Position and Cash Flows

  • Total assets increased by 249.9 billion yen from the end of March 2008 to 6,185.5 billion yen.
  • Shareholders' equity increased to 1,049.8 billion yen, an increase of 27.5 billion yen from the end of March 2008.
  • Total debt increased by 287.8 billion yen from the end of March 2008 to 1,548.8 billion yen. As a result of the foregoing, the debt-to-equity ratio was 148%, a 25-point worsening from the end of March 2008.
  • Free cash flow was -206.9 billion yen, 63.5 billion yen lower than for the same period of the previous year.

3. Performance Projection for FY2008

  • Toshiba's business projections for its consolidated results for the fiscal year 2008 remain unchanged from the projections announced on April 25, 2008 as it is necessary to carefully assess emerging trends in the business environment. The projections will be revised if necessary and immediately announced.

Q & A Session

Q1. Do you think you will not have to modify your FY08 forecasts?
Toshiba's business projections for its consolidated results for the FY2008 remain unchanged from the projections announced on April 25, 2008 as it is necessary to carefully assess emerging trends in the business environment. The projections will be revised if necessary and immediately announced. Our Digital Products and Social Infrastructure segments look relatively favorable. The Electronic Devices segment is becoming increasingly severe, and we are considering whether or not that can be compensated for by other business segments.
Q2. What is the main reason for the deterioration in your free cash flow?
In the current term, we saw deterioration in net income (loss) and in cash flow from investing activities (in the same period last year, we received payment for the sale of our holding in Toshiba EMI, and the like), and that was the primary cause.
Q3. Has there been any influence from the increase in raw materials prices?
There has been an impact from the rise in the price of steel, etc. We are taking such measures as design review in order to try and achieve cost reductions, and we are making every effort to absorb raw materials price increases and to limit their influence on our income (loss).
Q4. Can you tell us about the durability of the good performance in sales/profit in your Digital Products segment?
TV: In Q1, we saw increased sales of LCD TVs, and operating income in the business was at the break-even point. We will persevere in ensuring such a level. In addition, we consigned a part of manufacturing to outside contract manufacturers, and this helped us to reinforce cost competitiveness.
PC: In Q1, we saw favorable shipments to Europe. On a global base, we anticipate a 20% growth in shipments, and we will continue to make our best efforts.
Q5. Please explain the reason why your Semiconductor business recorded a first quarter loss.
In system LSI, it looks as if demand for consumer-oriented products, like digital consumer products and mobile phones, has built up more slowly than usual this year. The initial costs of acquisition of 300mm wafer lines also had an impact on our results. In addition to this, the other primary factors that had an impact on our performance were the high rate of price decline in NAND Flash memory and the impact of foreign currency exchange rate fluctuations.
Q6. What are the main risk factors in your FY08 semiconductor forecasts?
The influence of price decline has continued to make itself felt since FY07, and in the Q1 FY08 it produced harsh results. We are implementing cost reduction measures and directing all our efforts toward achieving our targets.
Q7. Do you think you will revise your FY08 semiconductor capital expenditure?
At this point, we do not expect to see any change in our capital expenditure plans. We will keep a close eye on semiconductor market conditions, and make appropriate decisions on how to proceed with the execution of our plans.

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