|Date||May 12, 2022|
|Presenter||Satoshi Hirano, President and CEO|
Q&AFor PDF file, please refer to “presentation material (with script)” on the previous page.
Could you tell us your analysis of the changes in operating income for FY2022?
We expect sales volume and product mix increase by 6 to 7 billion yen, FX effects and reduction of manufacturing costs will be around positive 2 billion yen in total, fixed costs will increase by 4 to 5 billion yen, and special factors will be a negative 2 to 3 billion yen.
I feel the economy is weakening as inflation progresses, and uncertainty is growing in FY2022. What kinds of things do you expect will negatively impact your business?
As I mentioned, uncertainty is definitely growing. However, our sales figures themselves haven’t suffer from it yet. In terms of our biggest business segment, Positioning Company, we can expect the increase of investment in infrastructure in the U.S to positively impact us. Major concerns are the surging logistics costs and component shortages.
Regarding the backlog, during the previous financial results briefing you told us that there was a large backlog because your production could not keep up with demand. How big was the backlog as of the end of FY2021, and how much will that contribute to FY2022 performance?
Since our company’s business model is based on prospective production, there is usually little backlog. However, due to the component shortages, there was a certain backlog as of the end of FY2021. The outlook for FY2022 is based on the assumption that there will be a similar backlog at the end of FY2022.
Logistics costs and component prices continue to soar. Could you elaborate on the price pass-through situation? To what extent is it included in the plan for FY2022?
We have already revised the prices in all businesses, particularly for competitively differentiated products. The revised prices, which were raised in FY2021, will be maintained, and further increases will be considered in some cases. Component prices are very expensive, and logistics costs are rising extremely.
I believe that the products of Smart Infrastructure Business and Eye Care Business are mainly produced in Japan and shipped overseas. Is the weak yen benefitting you?
The weak yen is positive. Please see the figures on page 38 of the presentation materials.
I believe that a GNSS development team is based in Russia. Could you let us know the current situation and its impact on future business performance?
We investigated whether it is in conflict with the economic sanctions against Russia. We found that there are NO conflicts, so we continue to operate.
You’re projecting 10% sales growth for FY2022. How much growth are you planning in terms of local currency?
Excluding the impact of foreign exchange rates, each segment is expected to grow approximately 5%.
Eye Care Business
Sales are growing. I would like to know how much the screening and digital optometry system sales mentioned in the presentation contribute to this growth.
Their contribution is big. At present, sales related to screening and digital optometry systems account for roughly half of the entire Eye Care Business.
Cautionary Note regarding Forward-Looking Statements
These materials contain forward-looking statements, including assumptions and projections based on the information available at the time these statements are made. However, please be aware that actual performance may differ from projected figures owing to unexpected changes in the economic environment in which we operate, as well as to market fluctuations.