OMRON Corporation Reports Consolidated Performance for First Quarter of Fiscal 2011

TOKYO--(BUSINESS WIRE)--OMRON Corporation (TOKYO:6645)(ADR:OMRNY) today reported consolidated performance for the first quarter of fiscal 2011 (the three months from April 1 to June 30, 2011).

Omron Group's consolidated net sales for the first quarter increased 3.0 percent compared with the same period of the previous fiscal year to JPY 151,415 million, as the impact of the Great East Japan Earthquake on Omron's operations was relatively minor and demand expanded overseas, particularly in emerging markets. Operating income increased 9.4 percent to JPY 12,153 million. Income before income taxes increased 7.7 percent to JPY 11,476 million, and net income attributable to shareholders increased 7.5 percent to JPY 6,925 million. The Omron Group increased sales and income compared with the same period of the previous fiscal year despite the effects of the stronger yen and high raw material prices.

Note: All amounts are rounded to the nearest million yen.

1. Overview of Conditions

The Japanese economy was sluggish despite a partial recovery trend, as corporate production activities and consumer spending dropped due to the Great East Japan Earthquake that occurred on March 11, 2011.

On the other hand, in overseas economies, expansion driven by internal demand continued in China and Southeast Asia. The U.S. economy was weak as the unemployment rate remained high, despite a solid economic recovery trend. In Europe, the worsening financial situation in some countries and other factors led to a growing perception of a slowdown.

In markets related to the Omron Group, demand for automotive electronic components and healthcare equipment decreased in Japan due to the effects of the earthquake. Overseas, however, capital investment demand was solid, primarily in the automotive and semiconductor industries, in addition to expanding demand resulting from economic growth in emerging markets.

In this environment, the Omron Group designated the approximately three months directly after the earthquake as an emergency response period and took various measures to fulfill its responsibility to supply products to customers globally.

The average exchange rates for the first quarter were USD 1 = JPY 81.7 and EUR 1 = JPY 118.1 (JPY 9.8 less and JPY 1.2 more than the same period of the previous fiscal year, respectively).

Consolidated Sales and Income
(Percentages represent changes compared with the same period of the previous fiscal year.)
	Millions of yen - except per share data and percentages
	Three months ended June 30, 2011		Three months ended June 30, 2010
		Change (%)		Change (%)
Net sales	151,415	3.0	146,959	37.4
Operating income	12,153	9.4	11,108	—
Income before income taxes	11,476	7.7	10,651	—
Net income attributable to shareholders	6,925	7.5	6,442	—
Net income attributable to shareholders per share, basic (JPY)	31.47		29.26
Net income attributable to shareholders per share, diluted (JPY)	31.47		29.26

Note: Comprehensive income (loss):	Three months ended June 30, 2011: JPY 4,638 million (—% change);
	Three months ended June 30, 2010: JPY (7,942 million) (—% change)

Results by Business Segment

Industrial Automation Business (IAB)

IAB segment sales to outside customers for the first quarter totaled JPY 74,852 million, an increase of 9.5 percent compared with the same period of the previous fiscal year.

In Japan, sales were solid, led by sensors and programmable controllers, partly due to the move among certain customers to secure inventories, although there were initial concerns about the effects of deferred capital investments and difficulty in procuring components in the automotive and semiconductor industries due to the earthquake.

Overseas, sales increased substantially in China, where demand grew for automobiles and household electrical appliances and internal demand related to social infrastructure improvements continued to expand. Sales also increased strongly in other regions in Asia, reflecting factors including increased capital investment demand centered on the semiconductor industry in South Korea. Sales were also strong in North America and Europe, supported by a moderate recovery in demand.

Electronic and Mechanical Components Business (EMC)

ECB segment sales to outside customers for the first quarter totaled JPY 20,388 million, an increase of 1.9 percent compared with the same period of the previous fiscal year.

In Japan, sales decreased as a result of the impact from the drop in demand for automotive relays and switches due to reduced automobile production because of the earthquake.

Overseas, sales of products for household electrical appliances were strong, partly due to the move toward advance procurement of components in China because of concerns about supply shortages due to the earthquake in Japan. Sales of automotive electronics were essentially unchanged, reflecting weak automobile production volume worldwide.

Automotive Electronic Components Business (AEC)

AEC segment sales to outside customers for the first quarter totaled JPY 18,439 million, a decrease of 14.7 percent compared with the same period of the previous fiscal year.

In Japan, automobile and electronic components manufacturers are recovering from the earthquake, but sales decreased substantially due to the effect of reduced automobile production.

Overseas, sales were firm in China and other emerging markets and in South Korea, but sales in North America decreased sharply because of reduced automobile production by Japanese manufacturers.

Social Systems, Solutions and Service Business (SSB)

SSB segment sales to outside customers for the first quarter totaled JPY 9,608 million, an increase of 10.5 percent compared with the same period of the previous fiscal year.

In the public transportation systems business, although uncertainty lingered in the capital investment of railway companies in the Kanto region due to the impact of the earthquake, sales increased substantially as Omron made partial deliveries of new equipment (automated ticket machines and automated ticket gates) that had been delayed from the end of the previous fiscal year.

In the traffic and road management systems business, sales increased substantially due to partial delivery and related installation of equipment that had been delayed from the end of the previous fiscal year due to the earthquake.

Healthcare Business (HCB)

HCB segment sales to outside customers for the first quarter totaled JPY 14,335 million, a decrease of 3.4 percent compared with the same period of the previous fiscal year.

In Japan, the market for healthcare equipment for household use such as digital blood pressure monitors continued to decline sharply, reflecting the impact of the drop in consumer spending except for energy-saving household electrical appliances. Overall domestic sales of healthcare equipment weakened despite solid sales of professional medical equipment.

Overseas, demand continued to increase for healthcare equipment and products due to rising awareness of the importance of health management in China, Southeast Asia, the Middle East and Latin America.

2. Consolidated Financial Position and Cash Flows

Total assets as of June 30, 2011 decreased JPY 24,410 million compared with the end of the previous fiscal year to JPY 538,380 million as cash and cash equivalents decreased due to repayment of short-term debt.

Total liabilities decreased JPY 29,031 million compared with the end of the previous fiscal year to JPY 220,107 million, reflecting decreases in short-term debt and accrued expenses. Net assets increased JPY 4,621 million from the end of the previous fiscal year to JPY 318,273 million. The shareholders' equity ratio was 58.9 percent, compared with 55.6 percent at the end of the previous fiscal year.

Net cash provided by operating activities in the first quarter was JPY 13,336 million (an increase of JPY 2,938 million compared with the same period of the previous fiscal year) due to collection of notes and accounts receivable - trade, in addition to net income.

Net cash used in investing activities was JPY 4,769 million (an increase in cash used of JPY 104 million compared with the same period of the previous fiscal year) as Omron continued to conduct highly selective capital investment.

Net cash used in financing activities was JPY 18,720 million (an increase in cash used of JPY 19,584 million compared with the same period of the previous fiscal year) due to a decrease in short-term debt.

As a result, the balance of cash and cash equivalents at June 30, 2011 was JPY 64,041 million, a decrease of JPY 10,694 million from the end of the previous fiscal year.

Consolidated Financial Position
	Millions of yen - except per share data and percentages
	As of June 30, 2011	As of March 31, 2011
Total assets	538,380	562,790
Net assets	318,273	313,652
Shareholders' equity	317,302	312,753
Shareholders' equity ratio (%)	58.9	55.6

Consolidated Cash Flows
	Millions of yen
	Three months ended June 30, 2010	Three months ended June 30, 2011
Net cash provided by operating activities	10,398	13,336
Net cash used in investing activities	(4,665)	(4,769)
Net cash provided by financing activities	864	(18,720)
Cash and cash equivalents at end of period	55,985	64,041

3. Dividends
		Year ended March 31, 2011	Year ending March 31, 2012	Year ending March 31, 2012 (projected)
Dividends per share	1st quarter dividend (JPY)	—	—
	2nd quarter dividend (JPY)	14.00		—
	3rd quarter dividend (JPY)	—		—
	Year-end dividend (JPY)	16.00		—
	Total dividends for the year (JPY)	30.00		—

Notes:	1.	Revisions to projected dividends during the three months ended June 30, 2011: No
	2.	The second-quarter and year-end dividends for the year ending March 31, 2012 are undetermined.
		For details, see "Projected Results for Fiscal 2011 (Ending March 31, 2012)" below.

4. Consolidated Performance Forecast

Consolidated performance for the first quarter ended June 30, 2011 was within the range of the forecast for the full fiscal year, and there is no change to the forecast announced on June 6, 2011 for the first two quarters and the fiscal year ending March 31, 2012.

Projected Results for Fiscal 2011 (Ending March 31, 2012)
(Percentages represent changes compared with the previous fiscal year or the previous interim period, as applicable.)
	Millions of yen - except per share data and percentages
	Six months ending September 30, 2011	Change (%)	Full year ending March 31, 2012	Change (%)
Net sales	309,500	3.9	655,000	6.0
Operating income	24,500	0.2	55,000	14.5
Income before income taxes	24,000	2.1	53,500	28.3
Note: Revisions to projected results during the three months ended June 30, 2011: None

The assumed exchange rates for the second quarter onward in the performance forecasts for the fiscal year are US$1 = JPY 80 and 1 Euro = JPY 113.

Note: The performance forecast and other forward-looking statements are based on information available to the Company at the present time, and on certain assumptions judged by the Company to be reasonable. Due to a variety of factors, actual results may differ materially from the forecast.

About OMRON

Headquartered in Kyoto, Japan, OMRON Corporation is a global leader in the field of automation. Established in 1933, and headed by President Yoshihito Yamada, OMRON has more than 36,000 employees in over 35 countries working to provide products and services to customers in a variety of fields including industrial automation, electronic components, social systems, and healthcare. The company has five regional head offices in Kyoto (Japan), Singapore (Asia Pacific), Shanghai (Greater China), Amsterdam (Europe, Africa, and the Middle East), and Chicago (the Americas). For more information, visit OMRON's website at http://www.omron.com/