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During the six-month interim period ended September 30,2009, the key client markets for our products continued to suffer from the effect of the sharp economic slowdown that began during the previous fiscal year. On the other hand, some signs of recovery in demand are apparent, especially in information technology, robots, machines and tools, and semiconductor manufacturing device spheres, among others.
In these market environments, the Group completed all new product development projects as originally planned for the first six months of the fiscal year, with clients’ commitments for purchase remaining intact. The Company also succeeded in reducing fixed costs as scheduled.
To facilitate Group-wide growth, the Company acquired SANYO KOGYO CO., LTD., effective July 1, 2009. As a wholly owned subsidiary, it is now included in the Company’s scope of consolidation.
Nevertheless, net sales for the interim period under review fell far short of projections, as order placements and deliveries that had been planned initially for the first half of the fiscal year were deferred to an unexpected degree to the second half of the fiscal year and beyond.
As a result, consolidated net sales for the six-month interim period under review declined ¥46.3% year on year, to ¥15,106 million. The consolidated operating loss stood at ¥3,157 million, while the consolidated ordinary loss totaled ¥2,821 million. The net loss amounted to ¥3,155 million.
The release of a number of new "San Ace” cooling system products noted for the industry’s top-level airflow, low noise and low energy consumption greatly buoyed exploration efforts in new markets, especially in the areas of solar power generation, fuel cells and light-emitting diodes (LEDs), and spurred interest among new sales agents.
On the other hand, demand from the telecommunications equipment sector for applications with third-generation mobile communication devices, which previously had been bolstered by sizable demand mainly from China, faltered somewhat during the interim period under review.
Demand from server manufacturers and factory automation (FA) equipment concerns, which have traditionally been the primary bulk users of the products, remained lackluster, as many purchases were deferred to the second half of the fiscal year.
As a result, net sales decreased 39.9% year on year, to ¥5,189 million.
The "SANUPS” power systems series saw significant demand from the communications sector, which opted for the Company’s small uninterruptible power supply (UPS) systems featuring the industry’s top power conversion efficiency.
In addition, we saw demand for instantaneous voltage dip compensators for applications with presses and mechanical parking systems. Sales of engine power generation systems to Japan’s Ministry of Defense remained firm, but demand dwindled for power conditioners for public and industrial photovoltaic power generation systems as well as large UPS systems for manufacturing plants.
As a result, net sales fell 31.2% year on year, to ¥2,566 million.
New servo motors, stepping motors and their respective drivers were added to the "SANMOTION” servo system line. Although we succeeded in capturing new, large-volume clients in Asia, clients in Japan’s manufacturing sector, including in the areas of machine tools, robots, semiconductor manufacturing equipment and injection molding equipment, continued to face an extremely difficult operating environment. Because of this, product purchases were deferred to the second half of the fiscal year and beyond.
As a result, net sales decreased 67.7% year on year, to ¥5,091 million.
Beginning from the second quarter of the interim period under review, the electrical equipment sales handled by SANYO KOGYO CO., LTD. are accounted for as a business of the Sanyo Denki Group. The key
business lines of this company include purchase and sale of industrial electrical equipment, control equipment and electric materials other than the products of the SANYO DENKI CO., LTD.
Net sales stood at ¥1,812 million.
Beginning from the second quarter of the interim period under review, the electrical works undertaken by SANYO KOGYO CO., LTD. are accounted for as a business of the Sanyo Denki Group. Major business
lines include the engineering, construction and maintenance works for power generation and substation equipment, steel producers’ electrical plants, and general electrical equipment for office and mid- and high-rise residential buildings; inspections and repairs of switches, electric motors and power generation systems; and inspections and repairs of switchboards and control boards on a contractual basis.
Net sales amounted to ¥446 million.