Hamamatsu Photonics K K : Financial Results for the First Quarter of Fiscal Year ending September 30, 2023 [144 KB

Consolidated Financial Results for the Second Quarter of Fiscal Year ending September 30, 2023 (Japanese GAAP)

	May 11, 2023
Company name: Hamamatsu Photonics K.K.	Stock listing: Tokyo Stock Exchange
Stock code: 6965	URL: https://www.hamamatsu.com/jp/en.html

Representative: Tadashi Maruno, Representative Director and President, Chief Executive Officer

Contact: Kazuhiko Mori, Director, Senior Executive Officer & Chief General Manager, Finance and Accounting

General Headquarters (Phone: [phone])

Scheduled date to file quarterly securities report: May 12, 2023

Scheduled date to begin dividend payments: June 2, 2023

Supplementary materials to the financial statements have been prepared: Yes

Presentation will be held to explain the financial statements: Yes (for analysts and institutional investors)

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

1. Consolidated financial results for the six months ended Mar. 31, 2023 (From Oct. 1, 2022 through Mar. 31, 2023)

(1) Consolidated operating results

Note: Percentage figures represent changes from the same period of the previous year.

	Net sales		Operating profit		Ordinary profit		Profit attributable to owners
				of parent
Six months ended	Millions of yen	%	Millions of yen	%	Millions of yen	%	Millions of yen	%
111,618	11.0	31,520	12.2	32,502		13.5	23,749	11.3
Mar. 31, 2023
Six months ended	100,516	26.7	28,097	95.2	28,645		99.0	21,341	97.9
Mar. 31, 2022
Note: Comprehensive income
Six months ended Mar. 31, 2023: 20,199 million yen [(21.4)%]
Six months ended Mar. 31, 2022: 25,713 million yen [92.6%]
	Earnings per share		Diluted earnings per share
Six months ended			Yen			Yen
		153.37			-
Mar. 31, 2023
Six months ended			137.83			-
Mar. 31, 2022

(2) Consolidated financial position

	Total assets	Net assets	Equity ratio
	Millions of yen	Millions of yen	%
As of Mar. 31, 2023	376,702	295,388	78.1
As of Sep. 30, 2022	366,177	281,904	76.6

For reference: Equity

As of Mar. 31, 2023: 294,149 million yen

As of Sep. 30, 2022: 280,563 million yen

2. Dividends

			Dividends per share
(Base date)	End of Q1	End of Q2	End of Q3
Fiscal year ended	Yen	Yen	Yen
-	32.00	-
Sep. 30, 2022
Fiscal year ending	-	38.00
Sep. 30, 2023
Fiscal year ending			-
Sep. 30, 2023
(Forecast)

Note: Revision of the forecasts for dividends most recently announced: No

End of FY

Yen 40.00

38.00

Full FY

Yen 72.00

76.00

3. Forecast of consolidated financial results for the fiscal year ending Sep. 30, 2023 (From Oct. 1, 2022 through Sep. 30, 2023)

			Note: Percentage figures represent changes from the same period ofthe previous year.
	Net sales		Operating profit	Ordinary profit	Profit attributable to	Earnings per
		owners of parent	share
					Millions of yen
Fiscal year ending	Millions of yen	%	Millions of yen	%	%	Millions of yen	%	Yen
223,900	7.2	55,800	(2.1)	56,900		(3.4)	39,600	(4.1)	255.73
Sep. 30, 2023
Note: Revision of the forecasts for consolidated financial results most recently announced: Yes

4. Others

1. Changes in consolidated subsidiaries (Changes in scope of consolidation): None
2. Application of special accounting treatment for preparing quarterly consolidated financial statements: Yes
3. Changes in accounting principles, changes in accounting estimates, and changes in presentation due to revisions

1. Changes in accounting principles accompanying revisions in accounting standards: None
2. Changes other than those in (a) above: None
3. Changes in accounting estimates: None
4. Changes in presentation due to revisions: None

1. Number of shares issued

1. Number of shares issued at end of period including treasury shares As of Mar. 31 2023: 165,065,948 shares
   As of Sep. 30, 2022: 165,052,729 shares
2. Number of treasury shares at end of period As of Mar. 31 2023: 10,214,410 shares As of Sep. 30, 2022: 10,214,389 shares
3. Average number of shares outstanding during the period Six months ended Mar. 31, 2023: 154,843,988 shares Six months ended Mar. 31, 2022: 154,832,192 shares

1. Qualitative Information Related to Consolidated Performance for the Second Quarter of This Fiscal Year

(1) Operating Results

During the second quarter of this fiscal year (six months ended March 31, 2023), Japan's economy, despite expectations that COVID-19 would be controlled and economic activities could coexist with it, was in a severe and uncertain situation due to concerns including a downturn in overseas economies, rising prices, prolonged difficulties in procuring parts and materials, and the impact of the situation in Ukraine amid continued global monetary tightening.

Given these circumstances, the Group, under a new management structure, worked to secure net sales and earnings by making reforms for further growth, continuing capital investment for future market expansion, and promoting research and product development utilizing the proprietary photonics technologies, with a view to contributing to a sustainable society.

As a result, we closed the second quarter with net sales of JPY 111,618 million, up by JPY 11,101 million (11.0%) compared with the same period one year ago. From an earnings perspective, operating profit was JPY 31,520 million, up by JPY 3,422 million (12.2%), ordinary profit was JPY 32,502 million, up by JPY 3,857 million (13.5%), and profit attributable to owners of parent was JPY 23,749 million, up by JPY 2,407 million (11.3%) from the same period one year ago, resulting in an increase in both net sales and earnings year on year.

Operating results by segment are as follows:

(Electron Tube)

Regarding photomultiplier tubes (PMT), imaging devices and light sources, although sales of Stealth Dicing Engine for high-speed,high-quality silicon wafer dicing and sales of PMT and light sources for semiconductor wafer inspection equipment declined due to the slowdown in global semiconductor demand, accompanying the expanding production of EV (electric vehicles), sales of microfocus X-ray sources for non-destructive testing increased, mainly in Asia, for automotive battery testing applications and circuit board inspection applications. In addition, sales of deuterium lamps for liquid chromatography and other analyzers increased mainly in Europe and the US, reflecting growing demand for applications such as analysis of pharmaceutical ingredients.

As a result, the Electron Tube business closed the second quarter with net sales of JPY 43,245 million, up by 10.1%, and operating profit of JPY 18,131 million, up by 12.6% from the same period one year ago. (Opto-semiconductor)

In opto-semiconductors, sales of flat panel sensors for dental diagnostic equipment decreased due to insufficient production resulting from difficulties in procuring materials. However, sales of silicon photodiodes for X-ray CTs continued to increase as demand shifted from low-end to high-end models, despite the partial impact of material shortages. In addition, sales of image sensors for semiconductor fabrication and inspection equipment increased due to strong orders received through the previous fiscal year, despite the impact of the global slowdown in semiconductor demand.

As a result, net sales in the Opto-semiconductor business were JPY 50,196 million, up by 8.2%, and operating profit was JPY 18,108 million, up by 3.5% from the same period one year ago.

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(Imaging and Measurement Instruments)

In image processing and measurement systems, sales of digital cameras increased not only in the life sciences sector and biotechnology sector but also in the physics sector, including quantum and astronomy, due to their ability to capture faint light with a wide field of view and high accuracy, and sales of X-ray cameras for non-destructive testing increased mainly overseas due to rising demand for inspection of automotive circuit boards and electronic components. Sales of failure analysis systems for semiconductor devices were also strong both in Japan and overseas, especially in Asia, as the new high-value-added products were praised for their ease of operation and high performance.

As a result, net sales for the Imaging and Measurement Instruments business were JPY 14,861 million, up by 24.0%, and operating profit was JPY 5,486 million, up by 57.0% from the same period one year ago.

(Other)

Sales from other operations include the semiconductor laser business, hotel operations run by Iwata Grand Hotel Inc., a subsidiary, and business relating to the unique products of Beijing Hamamatsu Photon Techniques Inc., which is also a subsidiary.

In our other businesses, net sales were JPY 3,315 million, up by 15.1%, and operating profit was JPY 94 million, down by 75.1% from the same period one year ago.

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(2) Financial Conditions

a. Summary of Assets, Liabilities and Net Assets

Current assets increased by JPY 2,096 million from the end of the previous fiscal year, mainly reflecting a JPY 10,146 million increase in inventories, despite a JPY 6,613 million decrease in cash and deposits. Non-current assets increased by JPY 8,428 million from the end of the previous fiscal year, mainly reflecting an increase in construction in progress of JPY 7,011 million.

As a result, total assets at the end of the second quarter were JPY 376,702 million, up by JPY 10,524 million from the end of the previous fiscal year.

Current liabilities decreased by JPY 2,332 million from the end of the previous fiscal year, mainly reflecting decreases in income taxes payable of JPY 4,436 million and provision for bonuses of JPY 2,479 million, despite increases in suspense receipts (current liabilities - other) of JPY 2,214 million and notes and accounts payable - trade of JPY 1,732 million.

Non-current liabilities decreased by JPY 627 million from the end of the previous fiscal year, mainly due to decreases in forward exchange contracts (non-current liabilities, other) of JPY 228 million and deferred tax liabilities (non-current liabilities, other) of JPY 175 million.

As a result, total liabilities at the end of the second quarter were JPY 81,313 million, down by JPY 2,959 million from the end of the previous fiscal year.

Net assets at the end of the second quarter were JPY 295,388 million, up by JPY 13,484 million from the end of the previous fiscal year, mainly reflecting an increase in retained earnings of JPY 17,544 million as a result of recording profit attributable to owners of parent, despite a decrease in foreign currency translation adjustment of JPY 4,226 million.

b. Summary of Cash Flows

At the end of the second quarter, cash and cash equivalents (referred to below as "cash") stood at JPY 114,370 million, down by JPY 8,695 million from the end of the previous fiscal year.

(Cash flows from operating activities)

Net cash provided by operating activities was JPY 20,211 million, down by JPY 208 million compared with JPY 20,420 million in the same period in the previous fiscal year. This mainly reflected profit before income taxes and depreciation.

(Cash flows from investing activities)

Net cash used in investing activities was JPY 18,960 million. This mainly comprised expenditures for the purchase of property, plant and equipment, resulting in an increase of JPY 7,886 million compared with expenditures of JPY 11,073 million in the same period of the previous fiscal year.

(Cash flows from financing activities)

Net cash used in investing activities was JPY 6,887 million. This mainly comprised dividends paid, resulting in an increase of JPY 3,190 million compared with expenditures of JPY 3,697 million in the same period of the previous fiscal year.

(3) Projection for the Year

Based on a careful review of the Group's earnings forecast for the fiscal year ending September 30, 2023, taking into account the conditions in markets where we are conducting our businesses and the operating performance in the most recent quarter, we have revised our forecast of consolidated financial results released on November 11, 2022, as follows.

We assume the yen/US dollar exchange rate for the second half year (from April 1, 2023 through September 30, 2023) will be JPY 125, the yen/Euro exchange rate will be JPY 135 and the yen/RMB exchange rate will be JPY 18.5.

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