Revision of NEC Corporation's Financial Forecast for Fiscal Year Ended March 31, 2006.Tokyo, Japan, Apr 21, 2006 - (JCN JCN Japan Corporate News
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JCN joint communications network (US DoD) Newswire) - NEC (NEC Corporation, Tokyo, www.nec.com, www.necus.com) An electronics conglomerate known in the U.S. for its monitors. In Japan, it had the lion's share of the PC market until the late 1990s (see PC 98).
NEC was founded in Tokyo in 1899 as Nippon Electric Company, Ltd. Corporation today revised its financial forecast for the fiscal year ended March 31, 2006, which was previously announced on October 27, 2005.
1. Revised consolidated financial forecast for the fiscal year ended March 31, 2006 (April 1, 2005 to March 31, 2006)
(In billions of yen) Net sales Pre-tax income Net income Forecast as of April 21, 2006 (A) 4,800.0 80.0 13.0 Forecast as of October 27, 2005 (B) 4,930.0 90.0 60.0 Difference (A - B) - 130.0 - 10.0 - 47.0
Note: As announced on March 22, 2006, NEC is planning to restate re·state
tr.v. re·stat·ed, re·stat·ing, re·states
To state again or in a new form. See Synonyms at repeat.
re·state its consolidated financial results for past fiscal years as a result of revisions relating to relating to relate prep → concernant
relating to relate prep → bezüglich +gen, mit Bezug auf +acc fictitious Based upon a fabrication or pretense.
A fictitious name is an assumed name that differs from an individual's actual name. A fictitious action is a lawsuit brought not for the adjudication of an actual controversy between the parties but merely for the purpose of transactions carried out at an NEC subsidiary and other revisions based on U.S. generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records.
Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting "U.S. GAAP GAAP
See: Generally Accepted Accounting Principles
See generally accepted accounting principles (GAAP). ". However, as exact figures have yet to be determined, NEC has not set forth the restated results for the fiscal year ended March 31, 2005, but will disclose such information as soon as possible.
2. Revised non-consolidated financial forecast for the fiscal year ended March 31, 2006 (April 1, 2005 to March 31, 2006)
(In billions of yen) Net sales Ordinary income Net income Forecast as of April 21, 2006 (A) 2,370.0 30.0 45.0 Forecast as of October 27, 2005 (B) 2,400.0 40.0 55.0 Difference (A - B) - 30.0 - 10.0 - 10.0 Results for the fiscal year ended 2,426.8 40.2 24.2 March 31, 2005
3. Revision of financial forecasts
1) Consolidated results
Despite continued steady sales in mobile infrastructure equipment as compared with the time of the previous announcement, the net sales Net Sales
The amount a seller receives from the buyer after costs associated with the sale are deducted.
This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight forecast for the fiscal year ended March 31, 2006 has been revised downward by 130.0 billion yen due to decreases in broadband sales and IT solutions sales and the impact of discontinued operations Discontinued operations
Divisions of a business that have been sold or written off and that no longer are maintained by the business. relating to sales of businesses that were completed after the previous forecast was announced.
Although the decrease in sales will have an effect on operating income Operating Income
The profit realized from a business' own operations.
This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. , operating income is forecasted to be 100.0 billion yen, with no change from the previously announced forecast, due to a positive impact relating to certain restatements based on U.S. GAAP. The forecast for income before income taxes has been revised downward by 10.0 billion yen from the previous announcement, due to the impact of discontinued operations of businesses that were sold after the previous forecast was announced.
The forecast for net income has been revised downward by 47.0 billion yen from the previous announcement. This is mainly due to a valuation allowance expected to be taken for deferred tax assets by NEC Electronics Corporation.
2) Non-consolidated results
Despite continued steady sales in mobile infrastructure equipment as compared with the time of the previous announcement, the net sales forecast for the fiscal year ended March 31, 2006 has been revised downward by 30.0 billion yen due to decreases in broadband sales and IT solutions sales.
The forecast for ordinary income has been revised downward by 10.0 billion yen from the previous announcement due to the decrease in forecasted net sales.
The forecast for net income has been revised downward by 10.0 billion yen from the previous announcement due to the decrease in forecasted ordinary income.
4. Year-end dividend Year-end dividend
A special dividend declared at the end of a fiscal year that usually represents distribution of higher-than-expected company profits.
See final dividend. for the fiscal year ended March 31, 2006
NEC expects to pay a year-end dividend of 3 yen per common share for the year ended March 31, 2006 (which would result in an annual dividend of 6 yen per common share, including the interim dividend paid in December 2005).
This material contains forward-looking statements forward-looking statement
A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. pertaining per·tain
intr.v. per·tained, per·tain·ing, per·tains
1. To have reference; relate: evidence that pertains to the accident.
2. to strategies, financial targets, technology, products and services, and business performance of NEC Corporation and its consolidated subsidiaries (collectively "NEC"). Written forward-looking statements may appear in other documents that NEC files with stock exchanges or regulatory authorities Noun 1. regulatory authority - a governmental agency that regulates businesses in the public interest
administrative body, administrative unit - a unit with administrative responsibilities , such as the U.S. Securities and Exchange Commission, and in reports to shareholders and other communications. The U.S. Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995 contains, and other applicable laws may contain, a safe-harbor for forward-looking statements, on which NEC relies in making these disclosures. Some of the forward-looking statements can be identified by the use of forward-looking words such as "believes," "expects," "may," "will," "should," "seeks," "intends," "plans," "estimates," "aims," or "anticipates," or the negative of those words, or other comparable words or phrases. You can also identify forward-looking statements by discussions of strategy, beliefs, plans, targets, or intentions. Forward-looking statements necessarily depend on currently available assumptions, data, or methods that may be incorrect or imprecise im·pre·cise
impre·cisely adv. and NEC may not be able to realize the results expected by them. You should not place undue reliance on forward-looking statements, which reflect NEC's analysis and expectations only. Forward-looking statements are not guarantees of future performance and involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those in the forward-looking statements. Among the factors that could cause actual results to differ materially from such statements include (i) global economic conditions and general economic conditions in NEC's markets, (ii) fluctuating fluc·tu·ate
v. fluc·tu·at·ed, fluc·tu·at·ing, fluc·tu·ates
1. To vary irregularly. See Synonyms at swing.
2. To rise and fall in or as if in waves; undulate.
v. demand for, and competitive pricing pressure on, NEC's products and services, (iii) NEC's ability to continue to win acceptance of NEC's products and services in highly competitive markets, (iv) NEC's ability to expand into foreign markets, such as China, (v) regulatory change and uncertainty and potential legal liability relating to NEC's business and operations, (vi) NEC's ability to restructure, or otherwise adjust, its operations to reflect changing market conditions, and (vii) movement of currency exchange rates, particularly the rate between the yen and the U.S. dollar. Any forward-looking statements speak only as of the date on which they are made. New risks and uncertainties come up from time to time, and it is impossible for NEC to predict these events or how they may affect NEC. NEC does not undertake any obligation to update or revise any of the forward-looking statements, whether as a result of new information, future events, or otherwise.
The management targets included in this material are not projections, and do not represent management's current estimates of future performance. Rather, they represent targets that management will strive to achieve through the successful implementation of NEC's business strategies.
Finally, NEC cautions you that the statements made in this material are not an offer of securities for sale. The securities may not be offered or sold in any jurisdiction in which registration is required absent registration or an exemption from registration under the applicable securities laws. For example, any public offering of securities to be made in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. must be registered under the U.S. Securities Act of 1933 and made by means of an English language English language, member of the West Germanic group of the Germanic subfamily of the Indo-European family of languages (see Germanic languages). Spoken by about 470 million people throughout the world, English is the official language of about 45 nations. prospectus that contains detailed information about NEC and management, as well as NEC's financial statements.
About NEC Corporation
NEC Corporation (NASDAQ NASDAQ
in full National Association of Securities Dealers Automated Quotations
U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : NIPNY) is one of the world's leading providers of Internet, broadband network and enterprise business solutions dedicated to meeting the specialized spe·cial·ize
v. spe·cial·ized, spe·cial·iz·ing, spe·cial·iz·es
1. To pursue a special activity, occupation, or field of study.
2. needs of its diverse and global base of customers. NEC delivers tailored solutions in the key fields of computer, networking and electron devices, by integrating its technical strengths in IT and Networks, and by providing advanced semiconductor solutions through NEC Electronics Corporation. The NEC Group employs more than 140,000 people worldwide and had net sales of 4,855 billion yen (approx. $45.4 billion) in the fiscal year ended March 2005.
For additional information, please visit the NEC home page at: http://www.nec.com
Source: NEC Corporation
In Japan: Diane Foley NEC Corporation firstname.lastname@example.org +81-3-3798-6511
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