Europe [Información de la compañía]

Financial Review

Review of Operations

In the automobile industry during the fiscal year ended March 31, 2014, Japan recorded new car sales of 5.69 million units, up 9.2% from the previous fiscal year due mainly to the release of a variety of new cars as well as last-minute demand before the consumption tax hike. Sales were the highest in seven years since fiscal 2013. New car sales continued to be favorable in the United States as well.
Within this market environment, the Clarion Group strived to strengthen our growth businesses by making upfront investments in such growing segments as the camera (Intelligent Safety) business and collaboration with IT operators. At the same time, we engaged in business operations from a global perspective, expanded sales of models with higher profit and reduced costs through structural reforms in order to reinforce the corporate structure.
In fiscal 2013, the Clarion Group recorded consolidated net sales of ¥191,337 million, up 7.9% from the previous fiscal year. This increase was primarily attributable to last-minute demand before an increase in the consumption tax rate and ongoing depreciation of the yen.
With regard to income, the Clarion Group posted consolidated operating income of ¥5,231 million. Although the purchase cost of overseas-made products increased as a result of the depreciation of the yen, we made efforts to expand sales of products with higher profit and reduce fixed costs. Additionally, Clarion posted a gain on contribution of securities to retirement benefit trust as other income. A loss on liquidation of subsidiary was recorded as other expenses in relation to the near completion in liquidation of Clarion Manufacturing Corporation of the Philippines, a wholly consolidated subsidiary. These factors led to an increase in income, which pushed up current income taxes. However, deferred income taxes decreased (Clarion wrote off a portion of deferred tax assets in the previous fiscal year), and net income amounted to ¥3,342 million, an increase of 146.0%.
Results by geographic segment (excluding intra-Group transactions) are as follows.

■ Japan

In addition to the release of a variety of new cars, last-minute demand before the consumption tax hike boosted car sales overall. This led to an increase in domestic new car sales volume by approximately 20% between October 2013 and March 2014 compared with the same period of the previous year. Moreover, Clarion posted strong sales in the original equipment manufacturer (OEM) market.
As a result, segment sales amounted to ¥101,360 million, up 5.1% year-on-year. Segment income stood at ¥1,949 million, a decrease of 0.7% year-on-year, due to an increase in the purchase cost of overseas-made products that arose from the sharp depreciation of the yen.

■ United States

Although new car sales in the United States were strong, sales in the OEM market decreased from the previous fiscal year due to the termination of sales of high-end products arising from a switchover in car model years by major customers. On the other hand, a consolidated subsidiary in Latin America posted strong sales attributable mainly to an expansion in commissioned production of automotive parts from Hitachi Group companies. The appreciation of the dollar against the yen also contributed to higher sales and profits
As a result, segment sales amounted to ¥56,558 million, up 4.2% year-on-year. Segment income increased 48.5% to ¥1,130 million.

■ Europe

While still uncertain, the European economy witnessed a glimpse of recovery during the fiscal year under review, which led to an upswing in orders from major customers.
As a result, segment sales amounted to ¥12,951 million, up 33.1% year-on-year. Segment income amounted to ¥187 million (compared with a segment loss of ¥0 million in the previous fiscal year

■ Asia and Australia

Strong car sales as well as a recovery in sales of Japanese cars in China resulted in higher sales in the Chinese OEM market. In Asia and Australia overall, the yen remained weak compared with the previous fiscal year.
As a result, segment sales amounted to ¥20,467 million, up 21.4% year-on-year. Segment income increased 458.9% to ¥1,810 million due to a rise in sales.
Forward-Looking Statements
The figures contained in this report with respect to Clarion’s plans and strategies and other statements that are not historical facts are forward-looking statements about the future performance of Clarion. Such statements are based on management’s assumptions and beliefs in light of the information currently available to it and involve risks and uncertainties. Actual results may differ from those in the forward-looking statements as a result of various factors. Potential risks and uncertainties include, without limitation, general economic conditions in Clarion’s market.

Financial Position

Current assets at fiscal year-end increased ¥4,541 million, or 6.8%, compared with the previous fiscal year-end to ¥70,937 million. This result was due to a ¥2,694 million increase in trade notes and accounts receivable, a ¥921 million increase in cash on hand and in banks and a ¥919 million increase in inventories.
Property, plant and equipment, net, increased ¥577 million, or 2.2%, from the previous fiscal year-end to ¥26,344 million. Intangible assets increased ¥1,654 million, or 8.7%, from the previous fiscal year-end to ¥20,655 million due mainly to the purchase of software. Investments and other assets increased ¥1,214 million, or 19.5%, from the previous fiscal year-end to ¥7,447 million. As a result, total assets at year-end increased ¥7,986 million, or 6.8%, compared with the previous fiscal year-end to ¥125,384 million.
Total liabilities increased ¥2,107 million, or 2.2%, from the previous fiscal year-end to ¥97,503 million. This was primarily the result of an increase in other accounts payable of ¥1,186 million and longterm other accounts payable of ¥686 million. Total net assets increased ¥5,878 million, or 26.7%, from the previous fiscal year-end to ¥27,881 million. This increase was attributable mainly to the recording of net income and a ¥3,376 million increase in foreign currency translation adjustments due to the impact of the weakening yen, offsetting such negative factors as remeasurements of defined benefit plans in the amount of ¥201 million that arose from the early adoption of the revised Accounting Standard for Retirement Benefits. As a result, the net assets ratio was 22.1%, an improvement of 3.5 percentage points from the previous fiscal year-end.

Cash Flows

This was mainly because a decrease in notes and accounts payable was offset by such factors as the recording of income before income taxes and minority interests and depreciation and amortization. Net cash provided by operating activities in the previous fiscal year was ¥5,488 million.
Net cash used in investing activities was ¥9,683 million. This was due mainly to payment for purchases of property, plant and equipment as well as payment for purchases of intangible assets. Net cash used in investing activities in the previous fiscal year was ¥11,350 million.
Net cash used in financing activities was ¥959 million due primarily to repayment of lease obligations. Net cash used in financing activities in the previous fiscal year was ¥564 million.
As a result of these factors, cash and cash equivalents at the end of the year amounted to ¥6,486 million compared with ¥5,564 million at the previous fiscal year-end.
■ Net Sales, Overseas Sales and Overseas Sales Ratio
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■ Operating Income (Loss) and Operating Income (Loss) Ratio
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■ Net Income (Loss) and Return on Sales
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■ Net Income (Loss) per Share 
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■ Total Assets, Net Assets and Net Assets Ratio
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■ Depreciation and Amortization
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■ Capital Investment
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■ Cash Flows
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■ ROE and ROA
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