(Based on JAPANESE GAAP)（Consolidated）
February 10, 2016
Company name: SECOM CO., LTD. (URL: http://www.secom.co.jp/) Code number: 9735 Tokyo Stock Exchange ---------- First Section Representative: Hiroshi Ito, President and Representative Director
For inquiries: Junzo Nakayama, Executive Director Phone (03) 5775-8100 Scheduled date of filing Quarterly Securities Report: February 12, 2016
Scheduled date of dividend payout: －
Preparation of quarterly supplementary materials: None Holding of quarterly results information meeting: None
1. Consolidated financial results for the nine-month period ended December 31, 2015 (April 1, 2015- December 31, 2015)Consolidated operating results (In millions of yen, figures rounded down)
Nine-month Period Ended December 31
2014
2015
Revenue
599,655
0.8%
622,722
3.8％
Operating profit
88,813
4.7%
91,854
3.4%
Ordinary profit
101,212
10.0%
97,867
(3.3%)
Net income
attributable to owners of the parent
59,691
13.2%
61,822
3.6%
Basic net income per share (in yen)
273.48
283.25
Diluted net income per share (in yen)
－
－
Note 1: Comprehensive income:
Nine-month period ended December 31, 2015: JPY 61,820 million [(23.4%)]
Nine-month period ended December 31, 2014: JPY 80,661 million [12.1%] Note 2: There is no diluted net income per share as there are no shares with dilutive effect.
Note 3: Percentage figures represent changes from the results of the corresponding period of the previous year.
Consolidated financial position (In millions of yen, figures rounded down)
March 31, 2015
December 31, 2015
Total assets
1,410,715
1,590,444
Net assets
907,341
939,280
Equity ratio
56.7%
52.1%
Net assets per share (in yen)
3,667.33
3,799.59
Note 1: Equity as of:
December 31, 2015 : JPY 829,306 million
March 31, 2015 : JPY 800,445 million
Note 2: Equity is calculated by deducting noncontrolling interests in subsidiaries from net assets. Net assets per share is calculated by dividing equity by the number of common shares outstanding, excluding treasury stock, as of each period-end.
- Dividends
Years ended March 31
2015
2016
2016
(projected)
1st quarter dividends per share (in yen)
-
-
2nd quarter dividends per share (in yen)
60.00
65.00
3rd quarter dividends per share (in yen)
-
－
Year-end dividends per share (in yen)
65.00
70.00
Annual dividends per share (in yen)
125.00
135.00
Note: Revision of projected dividends from that most recently disclosed: None
- Projections for the consolidated financial results for the fiscal year ending March 31, 2016 (April 1, 2015 - March 31, 2016)
Significant changes in subsidiaries during the nine-month period ended December 31, 2015 (changes in specified subsidiaries accompanied with changes in scope of consolidation): None
Adoption of unique accounting treatment for preparation of consolidated quarterly financial statements: None
Changes in accounting policies, accounting estimates and/or restatements:
① Changes in accounting policies associated with amendment of accounting standards: None
② Other changes in accounting policies: None
③ Changes in accounting estimates: None
④ Restatements: None
Number of common shares outstanding :
Qualitative Information Regarding Consolidated Financial Position........................................................- 3 -
Qualitative Information Regarding Consolidated Financial Projections ...................................................- 4 - 2. Items Regarding the Summary Information (Other) .......................................................................................- 4 -
Significant Changes in Subsidiaries in the Nine-month Period Ended December 31, 2015......................- 4 -
Adoption of Unique Accounting Treatment for Preparation of Consolidated Quarterly Financial Statements
..................................................................................................................................................................- 4 -
Changes in Accounting Policies, Accounting Estimates and/or Restatements..........................................- 4 - (4) Additional Information..............................................................................................................................- 4 - 3. Consolidated Quarterly Financial Statements .................................................................................................- 5 - (1) Consolidated Balance Sheets.....................................................................................................................- 5 -
- Qualitative Information Regarding the Nine-month Period Ended December 31, 2015
- Qualitative Information Regarding Consolidated Financial Results
During the nine-month period ended December 31, 2015, despite the upward trend in corporate earnings and employment environment, the outlook for Japanese economy has been remained uncertain mainly due to slow recovery in consumer spending and concerns over downturn in emerging economies including China while ongoing normalization of monetary policy in the US.
In this environment, we have been continuously trying to satisfy the increasingly diversified and sophisticated needs of our customers for their safety and peace of mind as well as comfort and convenient, with the aim of realizing our vision for the future, "Social System Industry,"a society where everyone can live safe and secure anytime and anywhere. To this end, we have made efforts to develop and provide high-quality products and services suited to customer needs in our security services segment, as well as in our fire protection services, medical services, insurance services, geographic information services, information and communication related services, and real estate and other services segments. We also pressed forward with efforts to apply the ALL SECOM concept, which emphasizes cooperation among our various independent businesses to strengthen the bond of the Group as a whole with a view to hastening our advance to growth. Furthermore, preparing for future Japanese society, we promote the effort to develop innovative services through ALL SECOM concept, in terms of key themes: super-aged society and disaster preparedness/business continuity planning (BCP)/environmental preservation, based on a foundation of our security services.
Consolidated revenue for the nine-month period ended December 31, 2015 increased by 3.8% to 622.7 billion yen. Consolidated operating profit increased by 3.4% to 91.8 billion yen. Consolidated ordinary profit decreased by 3.3% or 3.3 billion yen to 97.8 billion yen, mainly due to the decrease in net gains on private equity investment in the U.S. from the previous period (15/12: 0.2 billion yen, 14/12: 8.5 billion yen). Consolidated net income attributable to owners of the parent increased by 3.6% or 2.1 billion yen to 61.8 billion yen. For the nine-month period ended December 31, 2015, consolidated revenue, consolidated operating profit and consolidated net income attributable to owners of the parent have reached a record-high, respectively.
Segment information is as follows.
In the security services segment, revenue increased by 2.7% to 355.9 billion yen and operating profit went up by 3.0% to 84.0 billion yen, mainly due to brisk sales of on-line security systems for commercial and residential use and security merchandise including security camera systems.
In the fire protection services segment, revenue increased by 12.8% to 86.3 billion yen, mainly due to the active marketing efforts and the contribution of large-scale projects. Operating profit was up by 26.0% to 6.9 billion yen. Revenue tends to increase toward the end of the fiscal year, due to the fact that this segment is greatly affected by the construction industry.
In the medical services segment, revenue increased by 4.9% to 47.4 billion yen, mainly due to firm increase in sales of pharmaceutical products. Operating profit increased by 8.7% to 4.1 billion yen.
In the insurance services segment, revenue increased by 7.3% to 29.4 billion yen, mainly due to the firm increase in sales of fire insurance policy and MEDCOM, an unrestricted cancer treatment policy, provided by Secom General Insurance Co., Ltd. Operating profit decreased by 17.7% to 1.9 billion yen, mainly owing to the increase in losses incurred from damage of typhoons.
In the geographic information services segment, revenue increased by 2.7% to 36.5 billion yen, chiefly owing to the increase in revenue in international division. Operating loss amounted to 250 million yen, decreased from an operating loss of 270 million yen in the previous corresponding period, mainly due to the increase in cost ratio in public division. Revenue tends to concentrate toward the end of the fiscal year, due to the fact that deliveries of public-sector contracts, which is the primary market for this segment, are mainly made at the end of March.
In the information and communication related services segment, revenue decreased by 0.4% to 35.4 billion yen. Operating profit increased by 6.2% to 3.8 billion yen, chiefly owing to the decrease in selling, general and administrative expenses.
In the real estate and other services segment, revenue decreased by 3.1% to 31.4 billion yen. Operating profit went down by 10.2% to 2.8 billion yen, mainly due to the decrease in revenue in the real estate development and sales business and increase in cost ratio.
- Qualitative Information Regarding Consolidated Financial Position
(i) Consolidated Balance Sheets
Total assets as of December 31, 2015 amounted to 1,590.4 billion yen, 12.7% or 179.7 billion yen higher than that at the end of the previous fiscal year, chiefly owing to Asahi Security Co., Ltd., newly consolidated subsidiary. Total current assets, at 695.4 billion yen, were up 15.9% or 95.2 billion yen. This was largely attributable to increases in cash deposits for armored car services by 223.2% or 112.4 billion yen to 162.8 billion yen, call loans by 58.1% or 9.0 billion yen to 24.5 billion yen and work in process for real estate inventories by 31.4% or 6.6 billion yen to 27.6 billion yen, despite the decreases in cash on hand and in banks by 12.8% or 29.7 billion yen to 202.4 billion yen and notes and accounts receivable, trade by 11.0% or
12.4 billion yen to 101.5 billion yen. Total fixed assets, at 895.0 billion yen, were up 10.4% or 84.4 billion yen. This was mainly attributable to increases in tangible assets by 4.9% or 17.6 billion yen to 379.8 billion yen and intangible assets by 136.3% or 67.3 billion yen to 116.7 billion yen.
Total liabilities amounted to 651.1 billion yen, 29.4% or 147.7 billion yen higher than that at the end of the previous fiscal year. Total current liabilities amounted to 378.3 billion yen, up 52.7% or 130.6 billion yen, owing to the increases in cash deposits received for armored car services by 650.7% or 110.2 billion yen to
127.2 billion yen and bank loans by 97.8% or 43.9 billion yen to 88.9 billion yen, despite the decreases in accrued income taxes by 58.7% or 12.3 billion yen to 8.7 billion yen and accrued bonus by 61.2% or 8.9 billion yen to 5.6 billion yen. Long-term liabilities increased by 6.7% or 17.1 billion yen to 272.7 billion yen, compared to that at the end of the previous fiscal year. This was mainly attributable to the increases in lease obligations by 227.2% or 8.4 billion yen to 12.1 billion yen and investment deposits by policyholders, unearned premiums and other insurance liabilities by 4.6% or 6.8 billion yen to 157.0 billion yen.
Total net assets amounted to 939.2 billion yen, 3.5% or 31.9 billion yen higher than that at the end of the
previous fiscal year, mainly due to the increase in retained earnings by 4.8% or 33.4 billion yen.
- Qualitative Information Regarding Consolidated Financial Projections
The financial results for the nine-month period ended December 31, 2015 were generally within our projections. Accordingly, projections for the consolidated financial results for the fiscal year ending March 31, 2016 have not been changed from those disclosed on May 11, 2015.
As disclosed in "Notification concerning the Acquisition of Asahi Security Co., Ltd. Shares"on October 30, 2015, Asahi Security Co., Ltd. became our consolidated subsidiary on December 1, 2015. Detailed effects of this acquisition on projections for the consolidated financial results are under scrutiny. Once the revision of the projections for the consolidated financial results for the fiscal year ending March, 2016 becomes necessary, it will be disclosed in a timely manner.
(Notes for financial projections)
Projections for the consolidated financial results for the fiscal year ending March 31, 2016, are based on management's assumptions in light of information currently available. As actual performance may differ materially from the forward-looking statements due to various factors hereafter occurred, you should refrain from making an investment decision by solely relying on these projections. Such factors include, but are not limited to, changes in economic conditions affecting our group's operations, market trends, legislative changes, occurrences of natural disasters, recalls of products sold and the results of contingency.
- Items Regarding the Summary Information (Other)
- Significant Changes in Subsidiaries in the Nine-month Period Ended December 31, 2015
Not applicable.
- Adoption of Unique Accounting Treatment for Preparation of Consolidated Quarterly Financial Statements
Not applicable.
- Changes in Accounting Policies, Accounting Estimates and/or Restatements
Not applicable.
- Additional Information
- Consolidated Quarterly Financial Statements (1) Consolidated Balance Sheets
- Consolidated Balance Sheets (Continued)
(In millions of yen)
M arch 31, 2015
December 31, 2015
LIABILITIES:
Current liabilities:
Notes and accounts payable, trade Bank loans
Current portion of straight bonds Lease obligations
Payables - other
Accrued income taxes
Accrued consumption taxes Accrued expenses
Cash deposits received for armored car services Deferred revenue
Accrued bonuses
Provision for loss on construction contracts Other
Long-term liabilities: Straight bonds Long-term loans Lease obligations
Guarantee deposits received Deferred income taxes
Accrued retirement benefits for directors
and audit and supervisory board members Net defined benefit liability
Investment deposits by policyholders,
unearned premiums and other insurance liabilities Other
247,755
378,365
43,160
38,760
44,965
88,948
1,414
1,390
503
4,740
33,849
35,939
21,063
8,702
12,878
6,857
4,653
5,150
16,945
127,204
31,348
33,027
14,652
5,686
1,612
1,351
20,707
20,607
255,618
272,799
8,413
7,590
20,602
19,883
3,712
12,144
36,000
35,382
13,554
15,470
1,415
1,322
18,504
20,107
150,119
157,005
3,295
3,891
Total liabilities
503,374
651,164
NET ASSETS:
767,630
801,141
Shareholders' equity:
Common stock
66,377
66,377
Capital surplus
80,265
80,343
Retained earnings
694,688
728,136
Common stock in treasury, at cost
(73,701)
(73,716)
Accumulated other comprehensive income:
32,815
28,164
Unrealized gains on securities
26,981
26,349
Deferred losses on hedges
(34)
(34)
Foreign currency translation adjustments
1,477
(2,989)
Remeasurements of defined benefit plans, net of taxes
4,390
4,838
Noncontrolling Interests
106,895
109,973
Total net assets
907,341
939,280
Total liabilities and net assets
1,410,715
1,590,444
- Consolidated Statements of Income and Consolidated Statements of Comprehensive Income
Consolidated Statements of Income
(In millions of yen)
Consolidated Statements of Comprehensive IncomeNine-month period ended December 31, 2014
Nine-month period ended December 31, 2015
Revenue
599,655
622,722
Costs of revenue
393,824
410,966
Gross profit
205,831
211,755
Selling, general and administrative expenses
117,017
119,900
Operating profit
88,813
91,854
Non-operating income
15,093
9,066
Non-operating expenses
2,694
3,053
Ordinary profit
101,212
97,867
Extraordinary profit
1,890
978
Extraordinary losses
2,385
976
Income before income taxes
100,717
97,869
Income taxes - current
28,036
25,387
Income taxes - deferred
6,706
5,695
Total income taxes
34,743
31,083
Net income
65,974
66,786
Net income attributable to noncontrolling interests
6,282
4,964
Net income attributable to owners of the parent
59,691
61,822
(In millions of yen)
Nine-month period
ended December 31, 2014
Nine-month period
ended December 31, 2015
Net income
Other comprehensive income (losses): Unrealized gains (losses) on securities Foreign currency translation adjustments
Remeasurements of defined benefit plans, net of taxes
Share of other comprehensive income (losses) of affiliated companies accounted for under the equity method
Comprehensive income
Comprehensive income attributable to:
Comprehensive income attributable to owners of the parent company
Comprehensive income attributable to noncontrolling interests
65,974
14,687
9,917
2,569
672
1,528
66,786
(4,966)
(347)
(1,576)
242
(3,284)
80,661
61,820
73,737
6,923
57,171
4,648
- Notes Regarding the Consolidated Quarterly Financial Statement
[Notes Regarding the Assumption of Going Concern]
Not applicable.
[Notes Regarding Significant Changes in Shareholders' Equity]Not applicable.
- Segment Information, etc. [Segment Information]
- Nine-month Period Ended December 31, 2014
- Information About Amounts of Revenue and Profit or Loss by Reportable Segments
(In millions of yen)
Reportable segments
Security services
Fire protection services
M edical services
Insurance services
Geographic information services
Revenue:
346,721
76,605
45,200
27,460
35,603
Customers
Intersegment
9,923
3,634
109
2,478
108
Subtotal
356,645
80,240
45,310
29,938
35,711
Segment
profit (loss)
81,549
5,481
3,826
2,371
(279)
Reportable segments
Real estate and other services (Note 1)
Total
Adjustment (Note 2)
Amount on consolidated statements of income
(Note 3)
Information and communication related services
Subtotal
Revenue:
35,615
567,206
32,449
599,655
-
599,655
Customers
Intersegment
3,667
19,922
1,682
21,605
(21,605)
-
Subtotal
39,282
587,129
34,132
621,261
(21,605)
599,655
Segment
profit (loss)
3,622
96,571
3,182
99,753
(10,939)
88,813
Note 1: Real estate and other services is an operating segment not designated as a reportable segment, and comprises real estate development and sales, real estate leasing, construction and installation services, hotel businesses, etc.
Note 2: Adjustment of segment profit/loss includes intersegment eliminations of 454 million yen and corporate expenses not allocated to each reportable segment of 10,485 million yen. Major components of corporate expenses are expenses regarding planning, personnel and administrative departments of the Company's headquarter, etc.
Note 3: Segment profit/loss is adjusted to operating profit in the consolidated statements of income.
- Information About Impairment Loss on Fixed Assets and Goodwill by Reportable Segments
(Significant Changes in Goodwill)
Goodwill decreased due to the application of the Accounting Standard for Business Combinations (ASBJ Statement No.21, September 13, 2013), Accounting Standard for Consolidated Financial Statements (ASBJ Statement No.22, September 13, 2013), and Accounting Standard for Business Divestitures (ASBJ Statement No.7, September 13, 2013) from the three-month period ended June 30, 2014.
The amount of goodwill decreased by 3,675 million yen in the security services segment, 10 million yen in the fire protection services segment, 219 million yen in the insurance services segment, 1 million yen in the geographic information services segment, and 192 million yen in the information and communication related services segment for the nine-month period ended December 31, 2014.
- Nine-month Period Ended December 31, 2015
- Information About Amounts of Revenue and Profit or Loss by Reportable Segments
(In millions of yen)
Reportable segments
Security services
Fire protection services
M edical services
Insurance services
Geographic information services
Revenue:
355,999
86,389
47,401
29,464
36,556
Customers
Intersegment
9,121
3,034
133
2,239
71
Subtotal
365,121
89,423
47,535
31,703
36,627
Segment
profit (loss)
84,018
6,904
4,160
1,952
(256)
Reportable segments
Real estate and other services (Note 1)
Total
Adjustment (Note 2)
Amount on consolidated statements of income
(Note 3)
Information and communication related services
Subtotal
Revenue:
35,455
591,266
31,455
622,722
-
622,722
Customers
Intersegment
5,450
20,050
1,481
21,531
(21,531)
-
Subtotal
40,906
611,317
32,936
644,254
(21,531)
622,722
Segment
profit (loss)
3,847
100,626
2,856
103,483
(11,628)
91,854
Note 1: Real estate and other services is an operating segment not designated as a reportable segment, and comprises real estate development and sales, real estate leasing, construction and installation services, etc.
Note 2: Adjustment of segment profit/loss includes intersegment eliminations of (139) million yen and corporate expenses not allocated to each reportable segment of 11,767 million yen. Major components of corporate expenses are expenses regarding planning, personnel and administrative departments of the Company's headquarter, etc.
Note 3: Segment profit/loss is adjusted to operating profit in the consolidated statements of income.
- Information About Assets by Reportable Segments
There were significant changes in the amount of assets by reportable segment in the nine-month period ended December 31, 2015, compared to the amount at the end of the previous fiscal year. The summary information is as follows:
In the security services segment, the amount of segment assets increased by 227,399 million yen, mainly arising from the acquisition of Asahi Security Co., Ltd. in the nine-month period ended December 31, 2015.
- Information About Impairment Loss on Fixed Assets and Goodwill by Reportable Segments
(Significant Changes in Goodwill)
In the security services segment, goodwill increased due to the acquisition of Asahi Security Co., Ltd. in the nine-month period ended December 31, 2015. The amount of goodwill increased by 66,463 million yen in the nine-month period ended December 31, 2015, which was a provisional amount as the purchase price allocation has not been completed.
- Significant Subsequent Events
(In millions of yen)
Year ending March 31, 2016 | |
Projected revenue | 866,000 3.0% |
Projected operating profit | 126,100 2.0% |
Projected ordinary profit | 131,100 （4.1％ |
Projected net income attributable to owners of the parent | 80,200 6.4% |
Projected basic net income per share (in yen) | 367.45 |
）
Note 1: Revision of projections for the consolidated financial results from those most recently disclosed: None
Note 2: Projected basic net income per share for the fiscal year ending March 31, 2016 is calculated based on the number of average common shares outstanding over the nine-month period ended December 31, 2015, assuming that it remains the same until March 31, 2016.
Note 3: Percentage figures represent changes from the results of the corresponding period of the previous year.
※ Note
① Number of common shares outstanding, including treasury stock, as of: December 31, 2015 : 233,288,717 shares
March 31, 2015 : 233,288,717 shares
② Number of shares of treasury stock, as of: December 31, 2015 : 15,026,648 shares
March 31, 2015 : 15,024,812 shares
③ Number of average common shares outstanding over:
The nine-month period ended December 31, 2015: 218,262,999 shares
The nine-month period ended December 31, 2014: 218,265,747 shares
Note on status of quarterly review proceduresThis report is excluded from the scope of quarterly review procedures pursuant to the Financial Instruments and Exchange Act. Review procedures for quarterly financial statements have not been completed at the time of disclosure of this report.
Note on appropriate use of projections for the financial results; other special itemsThe forward-looking statements including the future performance described in this document are provided based on both all information available at this moment and certain assumptions considered reasonable. Actual performance may differ materially from the forward-looking statements due to various factors hereafter occurred. For matters regarding assumptions on financial projections and notes for the use of financial projections, please refer to "1. Qualitative Information Regarding the Nine-month Period Ended December 31, 2015 (3) Qualitative Information Regarding Consolidated Financial Projections"on page 4 in the appendices.
Contents for the Appendices1. Qualitative Information Regarding the Nine-month Period Ended December 31, 2015.................................- 2 -
(1) Qualitative Information Regarding Consolidated Financial Results .........................................................- 2 -
(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income ................- 7 - (3) Notes Regarding the Consolidated Quarterly Financial Statement ...........................................................- 9 - (4) Segment Information, etc. .........................................................................................................................- 9 - (5) Significant Subsequent Events ................................................................................................................- 11 -
The Company adopted the provision in the section 39 of the "Accounting Standard for Consolidated Financial Statements"(ASBJ Statement No. 22, September 13, 2013), and changed the presentation of net income, etc. as well as the presentation of minority interests to noncontrolling interests. To reflect these changes in the presentations, the quarterly consolidated financial statements for the nine-month period ended December 31 of the previous fiscal year and the consolidated financial statements for the previous fiscal year have been reclassified.
(In millions of yen)
M arch 31, 2015 | December 31, 2015 | |
ASSETS: Current assets: Cash on hand and in banks Cash deposits for armored car services Call loans Notes and accounts receivable, trade Due from subscribers Short-term investments Lease receivables and investment in leased assets M erchandise and products Real estate inventories Work in process Costs on uncompleted construction contracts Work in process for real estate inventories Raw materials and supplies Deferred income taxes Short-term loans receivable Other Allowance for doubtful accounts Fixed assets: Tangible assets: Buildings and improvements Security equipment and control stations Land Other Intangible assets Investments and others: Investment securities Long-term loans receivable Net defined benefit asset Deferred income taxes Other Allowance for doubtful accounts Deferred assets | 600,146 232,221 50,395 15,500 114,071 26,316 28,517 39,242 14,163 3,063 4,031 9,460 21,058 7,913 12,808 2,268 21,111 (1,997) 810,541 362,161 148,375 70,478 119,604 23,702 49,411 398,969 284,322 42,904 35,010 4,874 49,382 (17,525) 26 | 695,425 202,476 162,872 24,500 101,573 32,313 31,384 38,069 14,046 890 7,315 13,038 27,665 8,718 8,893 3,530 19,904 (1,768) 895,001 379,808 150,979 73,424 120,006 35,397 116,737 398,455 276,756 38,269 36,779 5,983 55,906 (15,242) 17 |
Total assets | 1,410,715 | 1,590,444 |
Not applicable.