Monday, June 16, 2014

minebea, led blu

fig: google finance

Minebea (6479.JP, OW, covered by Masashi Itaya)
We forecast Apple’s share of sales at 14% for FY14 and 16% for FY15. Three
companies (Minebea e-LITECOM, Omron) have supplied LED backlights for the
iPhone, but we expect Minebea’s share to increase as products become thinner. We
forecast Minebea’s share to rise to 70% in FY2014, and think further upside is also
possible. Moreover, although we do not factor this into our current estimates, we see
potential new business opportunities for the company if LED backlights for the
iPhone also become thinner.
- JPM  14/05/21

Question and Answer

We are going to make an urgent investment roughly totaling 4 billion yen to meet increasing orders for next year. Since construction will be completed between the end of this fiscal year and early next fiscal year, this amount will be posted as a capital expenditure for next fiscal year. Boosting production capacity will enable us to respond to 100 billion yen in sales starting next year.
Like smartphones, high-end tablet PC models are getting thinner and thinner. That gives us an advantage that we will actively leverage in order to drive sales up.

All three of these factors will affect our top line and bring sales up by 20 billion yen next year.
While we project sales will rise 20 billion yen to total 80 billion yen next year, our in-house target is 100 billion yen. If sales increase that much, the capacity utilization will naturally increase and so will the operating margin. What matters most is our technological edge, which we should be able to maintain for the next two years or so.
We take the risk seriously and are studying the situation. At the moment, we view the risk of that scenario coming to fruition over the next few years to be very minimal. A number of problems have been pointed out with organic LED, including low production yield, high production cost, large power consumption, low visibility under sunlight, etc. That's why we don't think organic LED will replace LCDs overnight. We're not basing our assumption on promises from our customers. We have a large share of the market for high quality products. That gives us a chance to work with customers on developing new products, so we can see firsthand where the trends for upcoming 
While we had expected that demand would drop due to seasonal factors, it doesn't look like it's going to fall when we look at it in light of the unofficial orders we've gotten from our customers. That's one reason. Another is the expanding customer base and increasing number of models we supply which will offset fluctuations in demand. Given that, we don't believe the shipment volume will fall as much as we originally expected.
I can't tell you anything until we've had a chance to look at the details of next fiscal year's sales forecast with our business units.
When it comes to measuring components, we don't have any competitors in the global arena. Our foundation is built on gauges. While there are some manufacturers of strain gauges in Europe and China, nobody has the extensive technological capability or global reach that we have. That puts us squarely ahead of the pack. The LED lighting market on the other hand is quite competitive. It's a big market with lots of manufacturers. Each country has its own market. We are looking to supply lighting device manufacturers with packaged solutions combining various technologies like our light guide plates, circuits, motors, etc. The strategy is already at work in the Chinese market where we have made inroads with products that have earned high marks from local governments as well as lighting manufacturers.

We can generate 100 billion yen in sales annually with our current production capacity. We decided to make an urgent capital investment totaling 3.2 billion yen this fiscal year. In order to increase sales, we must clear some hurdles that we cannot overcome all by ourselves, like securing parts from external suppliers, so that's going to be a challenge. That's why, to tell you the truth, I don't want to give you any specific figures.
Last year we received orders far exceeding our initial projection. Mobile phone companies in China and South Korea are now aggressively advertising their products. All these advertisements are for ultra-slim products. You can't hear the sound of 1.3 billion people waking up unless you actually go where they are. We've gone around the world to see for ourselves how well LED backlights are selling, and the orders coming from China seem to reflect a real demand. We want to have the kind of production capacity that will enable us to meet customers' needs as much as possible.
I've talked about demand growth only in the smartphone market, but our lighting technology is also appreciated in other markets including thin tablets, automobiles, and more. Although it's true that we cannot tell what things will be like five years from now, our strategy is to leverage our technological capability in the areas that we specialize in. That will enable us to enter the LED lighting market for smart cities and smart buildings and keep sales and profitability up. LED backlights and LED lighting for smart cities and smart buildings are all handled by our Lighting Device Business Unit. We regard them as the same in the sense that we are taking the lighting technology in our hands and making it our own.
It's because we now depreciate some of our general-purpose production lines over a two-year period using the accelerated depreciation method and recognize them as taxable expenses in addition to depreciating dedicated equipment for LED backlight production over a period of two years as we always have. The increase due to this change will come to about 0.7 billion yen for this fiscal year.
Temporary expenses totaled about 0.4 billion yen for disposal of surplus materials used in motor, LED backlight and measuring component production. Other expenses were accounted for as an extraordinary loss.
The figures announced this fiscal year include 16.6 billion yen for the first quarter, 24.0 billion yen for the second quarter, 23.0 billion yen for the third quarter, and 17.0 billion yen for the fourth quarter, for 80.6 billion yen in total. Sales to Chinese customers remained steady from January to March 2014, which was the fourth quarter of the previous fiscal year, and did not fall as much as we had expected. We can expect sales for this first quarter to far exceed our forecast. Our operating margin will be affected by depreciation costs this fiscal year since, as I mentioned earlier, we changed the depreciation period from 10 years to 2 years for some assets. That's why we don't expect to have a high operating margin this first quarter, but it should edge up toward the double digits in the second quarter when sales are expected to take off.
I cannot provide you with the percentage ratio of sales to Chinese customers at this time.
Sales will total 1.0 billion yen this fiscal year and 2.0 billion yen next fiscal year. Although our previously announced forecast was 5.0 billion yen, we changed our projection due to the status of customer sales. Sales should rise substantially in the subsequent fiscal year.
Our local staff is working really hard right now. Unfortunately we were unable to reach the production volumes that could fully satisfy customer needs last month. Still I can say we are making steady progress. If we can hold the line and consequently bring sales up to 100 billion yen, things should all work out in the end.
We are all aware of the current situation and are now discussing how we can create synergy while trying to overcome hurdles within the organization. It will be a while before we see those efforts pay off in quantitative terms. This is an area we still need to work on, and we are going to put more effort into it.
Last fiscal year, we saw more than 10 billion yen year on year improvement in motors. We gradually succeeded in getting a share of some niche markets. Since our market share has increased for products used in some specific applications, profit vulnerability has declined. On top of that, our customers in the automobile and office automation equipment industries saw demand recover thanks to upward market trends. We expect the business to remain somewhat upbeat.
Despite the fact that our operating margin rose to 26.0% in the fourth quarter of the last fiscal year, the operating margin for this fiscal year is projected to be 24.1%. That may seem strange but that's what we project. Since both production and sales volumes are upbeat in the first quarter, the operating margin should exceed our forecast if things continue to go as they are now. The operating margin for ball bearings is the highest, followed by pivot assemblies and rod-end fasteners at the moment.
Since we're a parts manufacturer, we've never raised our sales prices just because we were busy. We want to supply cutting-edge products to a host of customers, but the terms and conditions are different for customers who buy large quantities and those who don't because that's how the economy works. Although there are limitations to the injecting molding technology when making thinner products, we should be finished with depreciation of manufacturing equipment by that point.
When we bought back our shares in the past, we did that because our share price was abnormally low. Ensuring growth is our priority now, and to that end we are always looking into M&A opportunities as well. Under the current circumstances, we see there are things other than buying back our own shares that we should give higher priority to.
I don't think so as long as things keep moving at the current pace.
There were no special factors behind the increase.

매실이 대세

매실 엑기스라는 것을 들어 본 것이 10년이 넘지 않는다.
그러더니 어느새 한국음식이라면 안 들어가는 데가 거의 없어지고 있다.

매실을 담그는 집이 많아지고 있고, 마트에서 파는 매실담그는 병 사이즈가 커지고 있다고 한다.
건너건너 아는 시골할머니께서는 심어놓은 매실나무에서 매실이 너무 열려서 처치 곤란이라고 한다.
매실값이 너무 싸서 문제라는 얘기도 들린다.

망고, 블루베리, 체리같은 것도 몇년 사이 흔히 볼 수 있게 되었다.
몇년 전에는 동네 마트에는 없고 백화점에나 가야 볼 수 있었다.

그렇기는 하나 지금 대세는 매실이다.
조만간 쇠고기, 돼지고기 파동처럼 매실 파동이 생겨도 전혀 이상하지 않을 듯하다.

출하량, 재고, 가격을 확인해보면 무슨 일이 벌어지는지 알수 있겠지만, 구글 트렌드만 보고도 대충 짐작은 간다.

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중국은 지하철에서 음식을 먹는 것이 민폐라는 것을 알기는 아는 모양이다.