Premium photographic image-product company Fujifilm Holdings Corporation (FUJIY - Free Report) reported weak results for first-quarter fiscal 2017 (ended Jun 30, 2016). The underperformance was attributable to headwinds like unfavorable foreign currency translation, sluggish economic growth of emerging countries such as China and uncertain macroeconomic status of developed markets such as the U.K.
Net income for the quarter was ¥11.2 billion ($103.4 million), down 54.1% year over year. Quarterly earnings per American Depositary Receipt (“ADR”) was 23 cents, down 43.9% year over year.
Revenues
Revenues dipped 7.4% year over year to ¥547 billion ($5,069.6 million).
Revenues from the Imaging Solutions segment – 14% of the total revenue – came in at ¥77.3 billion ($716.2 million). The Information Solutions segment contributed ¥208.1 billion ($1,929.0 million) or 38% of the total revenue, while the Document Solutions segment generated ¥264.1 billion ($2,447.5 million) or 48% of the total revenue.
Of the total revenue, domestic revenues accounted for 40.5%, while international revenues made up the remaining 59.5%.
Costs/Margins
Gross margin in the fiscal first quarter was 40%, up 80 basis points (bps) year over year. Selling, general and administrative (SG&A) and R&D expenses were ¥191.1 billion ($1,771.4 million) or 35% of the total revenue.
Balance Sheet
Fujifilm exited the fiscal first quarter with cash and cash equivalents of ¥610.4 billion ($5,937.5 million), down 1.6% from the figure recorded as of Mar 31, 2016. The company’s long-term debt was ¥310.4 billion ($3,019.2 million), almost flat year over year.
Cash Flow
For the fiscal first quarter, Fujifilm’s net cash from operating activities totaled ¥103.7 billion ($960.9 million), while its capital expenditure was ¥20.3 billion ($188.3 million).
Outlook
Going forward, Fujifilm intends to improve its financials through strategic innovations and business expansion. The company expects a 2.3% year-over-year improvement in revenues to ¥2550 billion in fiscal 2017. Operating income is projected at ¥220 billion, reflecting a surge of 15.1% from the fiscal 2016 level. Moreover, net income for fiscal 2017 is expected to inch up 1.4% year over year to ¥125 billion. This will result in earnings per share of ¥277.47.
As of Jul 27, 2016 Fujifilm closed the trading session at $36.40 per share. However it remains to be seen how the stock performs after posting the lackluster quarterly results.
Other Stocks to Consider
Fujifilm currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the industry include Amphenol Corporation (APH - Free Report) , Intel Corporation (INTC - Free Report) and Plexus Corp. (PLXS - Free Report) . All the three companies presently hold a Zacks Rank #2 (Buy).
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Premium photographic image-product company Fujifilm Holdings Corporation (FUJIY - Free Report) reported weak results for first-quarter fiscal 2017 (ended Jun 30, 2016). The underperformance was attributable to headwinds like unfavorable foreign currency translation, sluggish economic growth of emerging countries such as China and uncertain macroeconomic status of developed markets such as the U.K.
Net income for the quarter was ¥11.2 billion ($103.4 million), down 54.1% year over year. Quarterly earnings per American Depositary Receipt (“ADR”) was 23 cents, down 43.9% year over year.
Revenues
Revenues dipped 7.4% year over year to ¥547 billion ($5,069.6 million).
Revenues from the Imaging Solutions segment – 14% of the total revenue – came in at ¥77.3 billion ($716.2 million). The Information Solutions segment contributed ¥208.1 billion ($1,929.0 million) or 38% of the total revenue, while the Document Solutions segment generated ¥264.1 billion ($2,447.5 million) or 48% of the total revenue.
Of the total revenue, domestic revenues accounted for 40.5%, while international revenues made up the remaining 59.5%.
Costs/Margins
Gross margin in the fiscal first quarter was 40%, up 80 basis points (bps) year over year. Selling, general and administrative (SG&A) and R&D expenses were ¥191.1 billion ($1,771.4 million) or 35% of the total revenue.
Balance Sheet
Fujifilm exited the fiscal first quarter with cash and cash equivalents of ¥610.4 billion ($5,937.5 million), down 1.6% from the figure recorded as of Mar 31, 2016. The company’s long-term debt was ¥310.4 billion ($3,019.2 million), almost flat year over year.
Cash Flow
For the fiscal first quarter, Fujifilm’s net cash from operating activities totaled ¥103.7 billion ($960.9 million), while its capital expenditure was ¥20.3 billion ($188.3 million).
Outlook
Going forward, Fujifilm intends to improve its financials through strategic innovations and business expansion. The company expects a 2.3% year-over-year improvement in revenues to ¥2550 billion in fiscal 2017. Operating income is projected at ¥220 billion, reflecting a surge of 15.1% from the fiscal 2016 level. Moreover, net income for fiscal 2017 is expected to inch up 1.4% year over year to ¥125 billion. This will result in earnings per share of ¥277.47.
As of Jul 27, 2016 Fujifilm closed the trading session at $36.40 per share. However it remains to be seen how the stock performs after posting the lackluster quarterly results.
Other Stocks to Consider
Fujifilm currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the industry include Amphenol Corporation (APH - Free Report) , Intel Corporation (INTC - Free Report) and Plexus Corp. (PLXS - Free Report) . All the three companies presently hold a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.Click to get this free report >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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