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Thursday 31 July, 2014

Sony Corp

Consolidated Financial Results for the First Qu...

Consolidated Financial Results for the First Quarter Ended June 30, 2014

Sony Corporation

Sony Corporation 
1-7-1 Konan, Minato-ku
Tokyo 108-0075 Japan

No. 14-072E

Consolidated Financial Results for the First Quarter Ended June 30, 2014

Tokyo, July 31, 2014 -- Sony Corporation today announced its consolidated financial results for the first quarter ended June 30, 2014 (April 1, 2014 to June 30, 2014).

 

 

(Billions of yen, millions of U.S. dollars, except per share amounts)

 

First Quarter ended June 30

   

2013  

   

2014  

   

Change in yen

  2014*
Sales and operating revenue

¥1,711.4

    ¥1,809.9     +5.8 %   $17,920
Operating income 35.5 69.8 +96.7 691
Income before income taxes 45.4 68.4 +50.6 677

Net income attributable to Sony Corporation’s
stockholders

3.1 26.8 +757.3 265

Net income attributable to Sony Corporation’s
stockholders per share of common stock:

- Basic

¥3.09

¥25.69

+731.4 % $0.25
- Diluted 2.68 22.94 +756.0 0.23

* U.S. dollar amounts have been translated from yen, for convenience only, at the rate of 101 yen = 1 U.S. dollar, the approximate Tokyo foreign exchange market rate as of June 30, 2014.

All amounts are presented on the basis of Generally Accepted Accounting Principles in the U.S. (“U.S. GAAP”).

Sony realigned its business segments from the first quarter of the fiscal year ending March 31, 2015 (“the current quarter”) to reflect modifications to its organizational structure as of April 1, 2014, primarily repositioning the operations of the previously reported Game and Mobile Products & Communications (“MP&C”) segments. In connection with this realignment, the previously-reported operations of the network business which were included in All Other have been integrated with the previously-reported Game segment and are now reported as the Game & Network Services (“G&NS”) segment. The previously reported Mobile Communications category which was included in the MP&C segment has been reclassified as the newly established Mobile Communications (“MC”) segment, while the other categories in the previously reported MP&C segment are now included in All Other. This includes the reclassification of the PC business into All Other.

In addition, as of the current quarter, the power supply business, which was previously included in the Devices segment, has been integrated into All Other to reflect modifications Sony made to its organizational structure as of June 1, 2014.

In connection with these realignments, the sales and operating revenue (“sales”) and operating income (loss) of each segment in the fiscal year ended March 31, 2014 have been reclassified to conform to the presentation of the fiscal year ending March 31, 2015.

Certain figures for the fiscal year ended March 31, 2014 related to the Financial Services segment have been revised from the versions previously disclosed. For further details, please see Note 8 on page F-14.

The average foreign exchange rates during the quarters ended June 30, 2013 and 2014 are presented below.

  First quarter ended June 30
   

2013 

 

2014 

  Change    
The average rate of yen    

    1 U.S. dollar

¥ 98.7

¥ 102.2

3.4%

 

(yen depreciation)

    1 Euro

128.9 140.1

8.0 

(yen depreciation)
 

Consolidated Results for the First Quarter Ended June 30, 2014

Sales were 1,809.9 billion yen (17,920 million U.S. dollars), an increase of 5.8% compared to the same quarter of the previous fiscal year (“year-on-year”). This increase was primarily due to a significant increase in G&NS segment sales, reflecting the contribution of the PlayStation 4 (“PS4”) which was launched in November 2013, a significant increase in Pictures segment sales primarily due to higher theatrical revenues in Motion Pictures, as well as the favorable impact of foreign exchange rates. This increase was partially offset by a significant decrease in sales in All Other, primarily related to Sony’s exit from the PC business. On a constant currency basis, sales increased 3% year-on-year. For further details about sales on a constant currency basis, see Note on page 9.

Operating income increased 34.3 billion yen year-on-year to 69.8 billion yen (691 million U.S. dollars). This increase was primarily due to a significant improvement in the operating results of the G&NS segment partially offset by a significant deterioration in the operating results of the MC segment.

Operating income during the current quarter includes a gain of 14.8 billion yen (146 million U.S. dollars) recognized on the sale of certain buildings and premises at Gotenyama Technology Center in Japan, recorded in Corporate and elimination.

During the current quarter, restructuring charges, net, increased 10.6 billion yen year-on-year to 15.3 billion yen (151 million U.S. dollars). PC exit costs of 18.3 billion yen (181 million U.S. dollars) were recorded in the current quarter, which includes 10.8 billion yen (107 million U.S. dollars) of restructuring charges. In addition, 2.4 billion yen (24 million U.S. dollars) of impairment charges that are mainly related to LCD televisions were also booked in the current quarter. For further details about PC exit costs, see page 7.

Equity in net income of affiliated companies, recorded within operating income, was 3.2 billion yen (32 million U.S. dollars), compared to a loss of 0.4 billion yen in the same quarter of the previous fiscal year. This improvement was mainly due to the recording of equity in net income for Intertrust Technologies Corporation compared to the equity in net loss in the same quarter of the previous fiscal year.

The net effect of other income and expenses was an expense of 1.4 billion yen (14 million U.S. dollars), compared to income of 9.9 billion yen in the same quarter of the previous fiscal year. This was primarily due to the recording of a net foreign exchange loss in the current quarter, compared to the recording of a net foreign exchange gain in the same quarter of the previous fiscal year, as well as a decrease in other non-operating income, partially offset by an increase in gains on sale of securities investments. The sale of securities investments in the current quarter includes a 4.8 billion yen (48 million U.S. dollars) gain on the sale of Sony’s shares in SQUARE ENIX HOLDINGS CO., LTD., which were sold in April, 2014.

Income before income taxes increased 23.0 billion yen year-on-year to 68.4 billion yen (677 million U.S. dollars).

Income taxes: During the current quarter, Sony recorded 26.0 billion yen (258 million U.S. dollars) of income tax expense, resulting in an effective tax rate of 38.1%.

Net income attributable to Sony Corporation’s stockholders, which excludes net income attributable to noncontrolling interests, increased 23.7 billion yen year-on-year to 26.8 billion yen (265 million U.S. dollars).

To view the full announcement, paste the following link into your web browser: http://www.sony.net/SonyInfo/IR/financial/fr/14q1_sony.pdf


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