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TOKYO, November 6, 2003 - CSK CORPORATION ("CSK") today issued revised consolidated and non-consolidated interim forecasts for the financial year ending March 31, 2004. Details of the revised forecasts are as follows, along with the previous forecasts issued on May 20, 2003.
1. Revised earnings forecasts for the interim period ended September 30, 2003
(1) Consolidated forecasts
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(¥ million)
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Net sales
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Ordinary income
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Net income
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Previous (A)
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170,000
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8,500
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2,000
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Revised (B)
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170,000
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12,000
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3,000
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Change (B) - (A)
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--
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3,500
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1,000
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Change in percent
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--
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41.2%
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50.0%
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Interim period ended
September 30, 2002
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165,709
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7,625
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1,007
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(2) Non-consolidated forecasts
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(¥ million) |
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Net sales
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Ordinary income
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Net income
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Previous (A)
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60,500
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4,000
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2,000
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Revised (B)
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62,800
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4,200
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2,400
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Change (B) - (A)
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2,300
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200
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400
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Change in percent
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3.8%
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5.0%
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20.0%
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Interim period ended
September 30, 2002
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58,383
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3,620
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2,610
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2. Reasons for revision of forecasts and comparison with previous interim period
(1) Consolidated forecasts
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A. Reason for revision
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The main reasons for the revised forecasts are as follows.
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i.
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Performance at consolidated subsidiaries including ServiceWare Corporation, CSK Communications Corporation, ISAO CORPORATION, and QUO CARD CO., LTD. has been stronger than was anticipated at the beginning of the period.
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ii.
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CSK FINANCE CO., LTD., which supports for the efficient use of Group management resources and capital, has contributed strongly to Group performance as financial services operations make steady progress.
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iii.
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Sales of amusement machines and game software have been strong at equity-accounted affiliate SEGA CORPORATION, resulting in Group non-operating income exceeding forecasts at the beginning of the period.
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B. Comparison with previous interim period actual results
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Consolidated
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(¥ million) |
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Net sales
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Ordinary income
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Net income
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Previous (A)
Interim period ended
September 30, 2002
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165,709
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7,625
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1,007
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Revised current
interim forecast (B)
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170,000
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12,000
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3,000
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Change (B) - (A)
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4,291
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4,375
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1,993
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Change in percent
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2.6%
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57.4%
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197.9%
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The main factors contributing to the improvement of the current interim forecast over the actual results from the previous interim period are as follows.
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i.
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Subsidiaries such as verification services company VeriServe Corporation and BPO company CSK Communication Corporation have performed well, and results are expected to exceed the previous interim period. In addition, performance has been steady in the finance service operations of CSK FINANCE CO., LTD., with a substantial improvement in results.
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ii.
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Other Group companies have produced steady improvement in performance over the previous interim period, as a result of Group wide initiatives to improve the management structure, sales capabilities, and efficiency of each subsidiary.
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iii.
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Equity-accounted affiliate SEGA CORPORATION has, along with other improvements, turned around losses in its game software division, resulting in Group non-operating income improving substantially over the previous interim period.
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(2) Non-consolidated forecasts
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A. Reason for revision
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The main reasons for the revised non-consolidated interim forecasts are as follows.
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i.
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With capital expenditure on IT recovering, computer equipment sales have exceeded forecasts at the beginning of the period.
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ii.
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Ordinary income and net income for the period have been positively impacted by the sale of investment securities to optimize the balance sheet and higher non-operating income from an increase in dividends received, and have exceeded forecasts at the beginning of the period.
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B. Comparison with previous interim period actual results
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Non-consolidated
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(¥ million) |
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Net sales
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Ordinary income
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Net income
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Previous (A)
Interim period ended
September 30, 2002
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58,383
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3,620
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2,610
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Revised current
interim forecast (B)
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62,800
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4,200
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2,400
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Change (B) - (A)
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4,417
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580
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(210)
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Change in percent
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7.6%
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16.0%
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(8.0%)
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The main factors contributing to the change of the current interim forecast over the actual results from the previous interim period are as follows.
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i.
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Net sales and ordinary income have benefited by a recovery in capital expenditure on IT and a positive trend in orders for computer equipment. Non-operating income was lifted by the sale of investment securities, and measures to reduce non-operating expenses have also contributed to increased revenue and profit.
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ii.
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The downward revision of net income for the period primarily relates to the fact that corporate income tax liabilities in the previous interim period were low, and the tax burden in the interim period to September 30, 2003 is relatively high.
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3. Full year forecasts
Although improved consolidated and non-consolidated performance has resulted in revised forecasts for the interim period, the scope for improvement on the full year forecasts issued on May 20, 2003 is not considered to be great. Therefore there are no changes to full year forecasts.
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