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FORM 6-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16 under

the Securities Exchange Act of 1934

For the month of October 2014

Commission File Number: 1-07952

KYOCERA CORPORATION

6, Takeda Tobadono-cho, Fushimi-ku,

Kyoto 612-8501, Japan

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F  x        Form 40-F  ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Registration S-T Rule 101(b)(1):  ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Registration S-T Rule 101(b)(7):  ¨

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereto duly authorized.

 

Date: October 30, 2014

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Information furnished on this form:

EXHIBITS

 

Exhibit     Number
1.		Consolidated Financial Results of Kyocera Corporation and its Subsidiaries for the Six Months Ended September 30, 2014

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Consolidated Financial Results of Kyocera Corporation and its Subsidiaries

for the Six Months Ended September 30, 2014

The consolidated financial information is prepared in accordance with accounting principles generally accepted in the United States of America.

1. Consolidated Financial Results for the Six Months Ended September 30, 2014

 

(1) Consolidated results of operations																			(% of change from previous period)
		Net sales								Profit from operations								Income before income taxes								Net income attributable to shareholders of Kyocera Corporation
		Million yen				%				Million yen				%				Million yen				%				Million yen				%
Six Months ended September 30, 2014			714,329				2.1				54,751				(5.9	)			68,118				(1.4	)			43,649				1.7
Six Months ended September 30, 2013			699,663				15.0				58,203				124.8				69,053				93.3				42,930				69.2

(Note) Comprehensive income:

120,677 million yen for the six months ended September 30, 2014, (24.2)% of change from previous period

159,209 million yen for the six months ended September 30, 2013, 487.2% of change from previous period

 

		Net income attributable to shareholders of Kyocera Corporation per share-Basic				Net income attributable to shareholders of Kyocera Corporation per share-Diluted
		Yen				Yen
Six Months ended September 30, 2014			118.98				118.98
Six Months ended September 30, 2013			117.02				117.02

Kyocera Corporation undertook a stock split at the ratio of two-for-one of all common stock on October 1, 2013. “Net income attributable to shareholders of Kyocera Corporation per share–Basic” and “Net income attributable to shareholders of Kyocera Corporation per share–Diluted” during the six months ended September 30, 2013 are calculated under the assumption that the stock split had been undertaken at the beginning of the year ended March 31, 2014 in accordance with the standard related to earnings per share.

(2) Consolidated financial condition

 

		Total assets				Total equity				Kyocera Corporation shareholders’ equity				Kyocera  Corporation shareholders’ equity to total assets
		Million yen				Million yen				Million yen				%
September 30, 2014			2,773,673				2,088,342				2,009,597				72.5
March 31, 2014			2,636,704				1,987,226				1,910,083				72.5

2. Dividends

 

		Dividends per share
		End of first quarter				End of second quarter				End of third quarter				Year-end				Annual
		Yen				Yen				Yen				Yen				Yen
Year ended March 31, 2014			—				80.00				—				40.00				—
Year ending March 31, 2015			—				40.00				—				40.00				80.00

(Note) Kyocera Corporation has adopted a resolution at the meeting of its Board of Directors held on October 30, 2014 to pay “End of second quarter” dividends (or interim dividends) per share of 40.00 yen for the year ended March 31, 2015. “End of second quarter” dividend per share of 80.00 yen for the year ended March 31, 2014 was calculated based on the number of shares before the stock split undertaken on October 1, 2013.

 

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3. Consolidated Financial Forecasts for the Year Ending March 31, 2015

(% of change from previous year)

		Net sales								Profit from operations								Income before income taxes								Net income attributable to shareholders of Kyocera Corporation								Net income attributable to shareholders of Kyocera Corporation per share
		Million yen				%				Million yen				%				Million yen				%				Million yen				%				Yen
Year ending March 31, 2015			1,580,000				9.2				135,000				12.0				158,000				8.0				97,000				9.3				264.40

(Note) Forecast of earnings per share attributable to shareholders of Kyocera Corporation is calculated based on the diluted average number of shares outstanding during the six months ended September 30, 2014.

(Notes)

(1) Increase or decrease in significant subsidiaries during the six months ended September 30, 2014: None

(2) Adoption of concise quarterly accounting method or procedure: None

(3) Changes in accounting policies:

 

(i)

Changes due to adoption of new accounting standards: Please refer to the accompanying “3. OTHER INFORMATION” on page 15.

 

(ii)

Changes due to other than adoption of new accounting standards: None

(4) Number of shares (common stock):

(i) Number of shares issued:

 

(ii) Number of treasury stock:

 

(iii) Average number of shares outstanding:

 

“Average number of shares outstanding” for the six months ended September 30, 2013 are calculated under the assumption that the stock split undertaken on October 1, 2013 had been undertaken at the beginning of the year ended March 31, 2014.

Presentation of Situation of Review Procedure

The consolidated financial information included in this report is out of scope of the review procedure under the Financial Instruments and Exchange Law of Japan. The review procedure under the Financial Instruments and Exchange Law of Japan has not been completed at the date of disclosure of this report.

Instruction for Forecasts and Other Notes

Cautionary Statement for Forecasts:

With regard to forecasts set forth above, please refer to the accompanying “Forward-Looking Statements” on page 10.

 

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Accompanying Information

1. BUSINESS RESULTS, FINANCIAL CONDITION AND PROSPECTS

(1) Business Results for the Six Months Ended September 30, 2014

Economic Situation and Business Environment

During the six months ended September 30, 2014 (“the first half”), the Japanese economy posted sluggish growth compared with the six months ended September 30, 2013 (“the previous first half”) due to stagnation in personal consumption reflecting the impact of an increase in the consumption tax rate, despite a moderate increase in capital investment. Overseas, the U.S. economy expanded on the back of solid growth in personal consumption and capital investment. The Chinese economy continued to post stable growth, while the European economy showed signs of slowing due to slumping domestic demand.

In the digital consumer equipment market, which is the principal market for Kyocera Corporation and its consolidated subsidiaries (“Kyocera Group” or “Kyocera”), demand for smartphones grew, particularly in emerging countries, and in the automotive market, sales increased steadily, mainly in China and the United States. Growth in the solar energy market in Japan, however, slowed considerably due mainly to the impact of the consumption tax rate increase and the end of government subsidies supporting solar power generation systems for residential use.

Consolidated Financial Results

Consolidated net sales for the first half amounted to ¥714,329 million, an increase of ¥14,666 million, or 2.1%, compared with ¥699,663 million for the previous first half due to increased sales in the Semiconductor Parts Group and the Information Equipment Group, despite declines in sales in the Electronic Device Group, which conducted structural reforms in the year ended March 31, 2014 (“the previous fiscal year”), and the Telecommunications Equipment Group.

Profit for the first half decreased compared with the previous first half due primarily to a decrease in profit in the Applied Ceramic Products Group mainly reflecting a decline in product selling prices, despite a significant increase in profit in the Information Equipment Group and more than double-digit increases in profit in the Fine Ceramic Parts Group and the Electronic Device Group. Profit from operations for the first half decreased by ¥3,452 million, or 5.9%, to ¥54,751 million, compared with ¥58,203 million for the previous first half. Income before income taxes decreased by ¥935 million, or 1.4%, to ¥68,118 million, compared with ¥69,053 million for the previous first half. On the other hand, net income attributable to shareholders of Kyocera Corporation in the first half increased by ¥719 million, or 1.7%, to ¥43,649 million, compared with ¥42,930 million for the previous first half due to decreased income taxes through the tax system revision in Japan.

Average exchange rates for the first half were ¥103 to the U.S. dollar, marking depreciation of ¥4 (approximately 4%) from ¥99 for the previous first half, and ¥139 to the Euro, marking depreciation of ¥9 (approximately 7%) from ¥130 for the previous first half.

 

		Six months ended September 30,																Increase (Decrease)
		2013								2014
		Amount				%				Amount				%				Amount				%
		(Yen in millions, except exchange rates)
Net sales		¥	699,663				100.0			¥	714,329				100.0			¥	14,666				2.1
Profit from operations			58,203				8.3				54,751				7.7				(3,452	)			(5.9	)
Income before income taxes			69,053				9.9				68,118				9.5				(935	)			(1.4	)
Net income attributable to shareholders of Kyocera Corporation			42,930				6.1				43,649				6.1				719				1.7
Average US$ exchange rate			99				—				103				—				—				—
Average Euro exchange rate			130				—				139				—				—				—

 

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Consolidated Results by Reporting Segment

1) Fine Ceramic Parts Group

Sales and operating profit in this reporting segment increased significantly compared with the previous first half due to an increase in sales of components for industrial machinery such as semiconductor processing equipment and of automotive components such as camera modules.

2) Semiconductor Parts Group

Sales in this reporting segment increased compared with the previous first half due to contribution from sales by Kyocera Circuit Solutions, Inc., which became a consolidated subsidiary of Kyocera in October 2013, and to an increase in sales of ceramic packages for telecommunications infrastructure and digital consumer equipment, particularly smartphones. Operating profit, however, decreased compared with the previous first half due primarily to the impact of a decline in demand for organic packages used in servers and to a decrease in product selling prices.

3) Applied Ceramic Products Group

The cutting tool business showed steady growth due to an increase of production volume on the part of automotive related market. Sales in the solar energy business, however, decreased compared with the previous first half due to the absence of sales contributions from large-scale solar projects for the public and commercial sectors recorded in the previous first half. As a result, sales in this reporting segment as a whole decreased compared with the previous first half. Operating profit decreased compared with the previous first half due to a decline in prices of solar modules.

4) Electronic Device Group

Sales in this reporting segment decreased compared with the previous first half due to the impact of structural reforms implemented in the previous fiscal year to downsize certain operations, despite steady growth in sales of components for smartphones. Operating profit, however, increased considerably compared with the previous first half due mainly to a reduction in costs, as well as the effect of the aforementioned structural reforms.

5) Telecommunications Equipment Group

Sales and operating profit in this reporting segment decreased compared with the previous first half due to a decline in demand in Japan, despite growth in sales overseas primarily on account of new model introductions.

6) Information Equipment Group

Sales in this reporting segment increased compared with the previous first half as a result of an increase in sales volume, particularly of multifunctional products, due to active efforts to cultivate markets and to expand sales of new products. Operating profit increased significantly compared with the previous first half due in part to an increase in sales of consumables and to a reduction in costs.

7) Others

Sales in this reporting segment increased compared with the previous first half due to an increase in sales primarily at Kyocera Communication Systems Co., Ltd. and Kyocera Chemical Corporation. Operating profit increased compared with the previous first half due to the effect of the increase in sales.

 

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Net Sales by Reporting Segment

 

		Six months ended September 30,																Increase
		2013								2014								(Decrease)
		Amount				%				Amount				%				Amount				%
		(Yen in millions)
Fine Ceramic Parts Group		¥	38,187				5.5			¥	43,224				6.0			¥	5,037				13.2
Semiconductor Parts Group			87,063				12.4				102,173				14.3				15,110				17.4
Applied Ceramic Products Group			127,515				18.2				124,714				17.5				(2,801	)			(2.2	)
Electronic Device Group			147,451				21.1				138,843				19.4				(8,608	)			(5.8	)
Total Components Business			400,216				57.2				408,954				57.2				8,738				2.2
Telecommunications Equipment Group			96,557				13.8				91,555				12.8				(5,002	)			(5.2	)
Information Equipment Group			144,525				20.7				157,648				22.1				13,123				9.1
Total Equipment Business			241,082				34.5				249,203				34.9				8,121				3.4
Others			79,713				11.4				83,457				11.7				3,744				4.7
Adjustments and eliminations			(21,348	)			(3.1	)			(27,285	)			(3.8	)			(5,937	)			—
Net sales		¥	699,663				100.0			¥	714,329				100.0			¥	14,666				2.1
Operating Profit (Loss) by Reporting Segment
		Six months ended September 30,																Increase
		2013								2014								(Decrease)
		Amount				%*				Amount				%*				Amount				%
		(Yen in millions)
Fine Ceramic Parts Group		¥	5,762				15.1			¥	7,009				16.2			¥	1,247				21.6
Semiconductor Parts Group			16,041				18.4				14,655				14.3				(1,386	)			(8.6	)
Applied Ceramic Products Group			14,834				11.6				5,776				4.6				(9,058	)			(61.1	)
Electronic Device Group			14,662				9.9				16,684				12.0				2,022				13.8
Total Components Business			51,299				12.8				44,124				10.8				(7,175	)			(14.0	)
Telecommunications Equipment Group			266				0.3				(1,258	)			—				(1,524	)			—
Information Equipment Group			10,449				7.2				17,207				10.9				6,758				64.7
Total Equipment Business			10,715				4.4				15,949				6.4				5,234				48.8
Others			2,001				2.5				2,494				3.0				493				24.6
Operating profit			64,015				9.1				62,567				8.8				(1,448	)			(2.3	)
Corporate gains and equity in earnings of affiliates and an unconsolidated subsidiary			5,370				—				6,109				—				739				13.8
Adjustments and eliminations			(332	)			—				(558	)			—				(226	)			—
Income before income taxes		¥	69,053				9.9			¥	68,118				9.5			¥	(935	)			(1.4	)

*	% to net sales of each corresponding segment

 

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Net Sales by Geographic Area

1) Japan

Sales in Japan decreased compared with the previous first half due primarily to a decline in sales for large-scale solar projects for public and commercial sectors, although sales in the Semiconductor Parts Group increased.

2) Asia

Sales in Asia increased compared with the previous first half due primarily to an increase in sales in the cutting tool business, the Electronic Device Group and the Semiconductor Parts Group.

3) Europe

Sales in Europe increased compared with the previous first half due primarily to an increase in sales in the Information Equipment Group supported by growth in sales volume of multifunctional products and the Electronic Device Group.

4) United States of America

Sales in the United States of America increased compared with the previous first half due mainly to increased sales in the Information Equipment Group.

5) Others

Sales in Others decreased slightly compared with the previous first half due to a decrease in sales in the Semiconductor Parts Group and the Telecommunications Equipment Group despite increased sales in the Information Equipment Group.

 

		Six months ended September 30,																Increase (Decrease)
		2013								2014
		Amount				%				Amount				%				Amount				%
		(Yen in millions)
Japan		¥	299,430				42.8			¥	295,404				41.4			¥	(4,026	)			(1.3	)
Asia			139,201				19.9				142,288				19.9				3,087				2.2
Europe			114,119				16.3				129,071				18.1				14,952				13.1
United States of America			113,870				16.3				115,056				16.1				1,186				1.0
Others			33,043				4.7				32,510				4.5				(533	)			(1.6	)
Net sales		¥	699,663				100.0			¥	714,329				100.0			¥	14,666				2.1

 

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(2) Consolidated Financial Condition

Consolidated Cash Flows

Cash and cash equivalents at September 30, 2014 decreased by ¥37,374 million to ¥297,800 million from ¥335,174 million at March 31, 2014.

1) Cash flows from operating activities

Net cash provided by operating activities for the first half decreased by ¥10,550 million to ¥63,915 million from ¥74,465 million for the previous first half. This was mainly because cash flow adjustments related to deferred income taxes and receivables exceeded cash flow adjustment related to other current liabilities.

2) Cash flows from investing activities

Net cash used in investing activities for the first half increased by ¥33,283 million to ¥87,050 million from ¥53,767 million for the previous first half. This was due mainly to an increase in payments for purchases of held-to-maturity securities and a decrease in withdrawal of time deposits and certificate of deposits, which were partly offset by increases in proceeds from sales and maturities of held-to-maturity and available-for-sale securities and a decrease in acquisition of time deposits and certificate of deposits.

3) Cash flows from financing activities

Net cash used in financing activities for the first half increased by ¥7,668 million to ¥22,037 million from ¥14,369 million for the previous first half. This was due mainly to an increase in dividends paid and purchases of noncontrolling interests.

 

		Six months ended September 30,
		2013				2014
		(Yen in millions)
Cash flows from operating activities		¥	74,465			¥	63,915
Cash flows from investing activities			(53,767	)			(87,050	)
Cash flows from financing activities			(14,369	)			(22,037	)
Effect of exchange rate changes on cash and cash equivalents			5,160				7,798
Net increase (decrease) in cash and cash equivalents			11,489				(37,374	)
Cash and cash equivalents at beginning of period			305,454				335,174
Cash and cash equivalents at end of period		¥	316,943			¥	297,800

(3)  Interim dividend for the year ending March 31, 2015

Kyocera Corporation (the “Company”) has adopted a basic guideline to the effect that dividend amounts will in principle be within the amount of net income attributable to shareholders of the Company on a consolidated basis, and subject to this guideline has set its consolidated dividend policy to maintain a consolidated payout ratio of 30% or more. The Company has fixed the amount of its interim dividend for the year ending March 31, 2015 (“fiscal 2015”) at 40 yen per share, in accordance with this basic profit allocation policy.

The Company undertook a stock split at the ratio of two-for-one of all common stock on October 1, 2013, and there is no effective change in interim dividends in fiscal 2015, as compared with its interim dividends of 80 yen per share in the year ended March 31, 2014, which based on the number of shares prior to the stock split.

The Company forecasts payment of its year-end dividend for fiscal 2015 in the amount of 40 yen per share, and has not changed its previously published annual dividend forecast of 80 yen per share.

 

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(4)  Consolidated Financial Forecasts for the Year Ending March 31, 2015

From the three months ending December 31, 2014 (“the third quarter”) onward, Kyocera expects component demand to increase on the back of increased production of digital consumer equipment, particularly smartphones, and steady growth in the industrial machinery market and automotive related markets. Kyocera also expects sales to increase due to active new product introductions of mobile phone handsets and multifunctional products and to market cultivation.

In light of this outlook, sales and profit from the third quarter onward are projected to exceed the first half as originally forecasted, and as a result, Kyocera has not revised its consolidated financial forecasts for the year ending March 31, 2015 as announced in April 2014. Forecasts for operating profit in each of the reporting segments have been revised as shown on the following page, based on results in the first half and the outlook for the third quarter onward.

Kyocera has revised its forecasts of average exchange rates for the second half from the projections made in April 2014, from ¥100 to ¥105 against the U.S. dollar and from ¥137 to ¥135 against the Euro. As a result, full-year forecasts of average exchange rates for the year ending March 31, 2015 have been revised to ¥104 to the U.S. dollar and ¥137 to the Euro.

Kyocera aims to achieve its full-year financial forecasts by continuing to leverage the collective capabilities of the Kyocera Group in order to secure orders, strengthen new product development and cultivate new markets, as well as through comprehensive cost reductions.

 

		Results for the year ended March 31, 2014								Forecasts for the year ending March 31, 2015								Increase (Decrease)
		Amount				%				Amount				%				Amount				%
		(Yen in millions, except exchange rates)
Net sales		¥	1,447,369				100.0			¥	1,580,000				100.0				132,631				9.2
Profit from operations			120,582				8.3				135,000				8.5				14,418				12.0
Income before income taxes			146,268				10.1				158,000				10.0				11,732				8.0
Net income attributable to shareholders of Kyocera Corporation			88,756				6.1				97,000				6.1				8,244				9.3
Average US$ exchange rate			100				—				104				—				—				—
Average Euro exchange rate			134				—				137				—				—				—

 

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Net Sales by Reporting Segment

 

		Results for the year ended March 31, 2014								Forecasts for the year ending March 31, 2015 announced on																Increase (Decrease) to Results
										April 28, 2014 (Previous)								October 30, 2014 (Revised)
		Amount				%				Amount				%				Amount				%				%
		(Yen in millions)
Fine Ceramic Parts Group		¥	80,020				5.5			¥	91,000				5.7			¥	91,000				5.7				13.7
Semiconductor Parts Group			187,891				13.0				224,000				14.2				224,000				14.2				19.2
Applied Ceramic Products Group			272,795				18.9				303,000				19.2				303,000				19.2				11.1
Electronic Device Group			284,322				19.6				291,000				18.4				291,000				18.4				2.3
Total Components Business			825,028				57.0				909,000				57.5				909,000				57.5				10.2
Telecommunications Equipment Group			186,749				12.9				205,000				13.0				205,000				13.0				9.8
Information Equipment Group			307,848				21.3				335,000				21.2				335,000				21.2				8.8
Total Equipment Business			494,597				34.2				540,000				34.2				540,000				34.2				9.2
Others			173,137				11.9				178,000				11.3				178,000				11.3				2.8
Adjustments and eliminations			(45,393	)			(3.1	)			(47,000	)			(3.0	)			(47,000	)			(3.0	)			—
Net sales		¥	1,447,369				100.0			¥	1,580,000				100.0			¥	1,580,000				100.0				9.2
Operating Profit by Reporting Segment
		Results for the year ended March 31, 2014								Forecasts for the year ending March 31, 2015 announced on																Increase (Decrease) to Results
										April 28, 2014 (Previous)								October 30, 2014 (Revised)
		Amount				%*				Amount				%*				Amount				%*				%
		(Yen in millions)
Fine Ceramic Parts Group		¥	11,836				14.8			¥	13,700				15.1			¥	15,000				16.5				26.7
Semiconductor Parts Group			31,889				17.0				33,600				15.0				33,600				15.0				5.4
Applied Ceramic Products Group			33,501				12.3				30,300				10.0				15,000				5.0				(55.2	)
Electronic Device Group			21,160				7.4				28,900				9.9				35,900				12.3				69.7
Total Components Business			98,386				11.9				106,500				11.7				99,500				10.9				1.1
Telecommunications Equipment Group			1,437				0.8				8,300				4.0				8,300				4.0				477.6
Information Equipment Group			28,193				9.2				33,500				10.0				33,500				10.0				18.8
Total Equipment Business			29,630				6.0				41,800				7.7				41,800				7.7				41.1
Others			6,276				3.6				6,400				3.6				6,400				3.6				2.0
Operating profit			134,292				9.3				154,700				9.8				147,700				9.3				10.0
Corporate and others			11,976				—				3,300				—				10,300				—				(14.0	)
Income before income taxes		¥	146,268				10.1			¥	158,000				10.0			¥	158,000				10.0				8.0

*	% to net sales of each corresponding segment

 

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Note:  Forward-Looking Statements

Certain of the statements made in this document are forward-looking statements (within the meaning of Section 21E of the U.S. Securities and Exchange Act of 1934), which are based on our current assumptions and beliefs in light of the information currently available to us. These forward-looking statements involve known and unknown risks, uncertainties and other factors. Such risks, uncertainties and other factors include, but are not limited to the following:

 

(1)	Decline in demand for our products due to sluggish economic conditions in Japan and worldwide;

 

(2)	Economic, political and legal conditions and unexpected changes therein in countries or areas where we operate;

 

(3)	Factors that may affect our exports, including the yen’s appreciation, political and economic instability, customs, and inadequate protection of our intellectual property;

 

(4)	Fluctuation in exchange rates that may affect the value of our foreign assets or our business activities;

 

(5)	Intensified competition in product pricing, technological innovation, R&D activities, product quality and speed of delivery;

 

(6)	Manufacturing delays or defects resulting from outsourcing or internal manufacturing processes;

 

(7)	Shortages and rising costs of electricity affecting our production and sales activities;

 

(8)	The possibility that expansion of production capacity and in-process R&D activities may not produce the desired results;

 

(9)	The possibility that companies or assets acquired by us may not produce the returns or benefits, or bring in business opportunities, which we expect;

 

(10)	Inability to secure skilled employees, particularly engineering and technical personnel;

 

(11)	The possibility of divulgence of our trade secrets and infringement of our intellectual property rights;

 

(12)	The possibility that we may receive notice of claims of infringement of other parties’ intellectual property rights and claims for royalty payments;

 

(13)	Increases in our environmental liability and in costs and expenses required to observe obligations imposed by environmental laws and regulations in Japan and other countries;

 

(14)	Unintentional conflict with laws and regulations, or the possibility that amendments to laws and regulations or newly enacted laws and regulations may limit our business operations;

 

(15)	Events that may negatively impact our markets or supply chain, including plague, terrorist acts, international disputes and conflicts, etc. and similar events;

 

(16)	Earthquakes and other related natural disasters affecting our operational facilities and our markets or supply chain, as well as social and economic infrastructure;

 

(17)	Exposure to difficulties in collection of trade receivables due to customers’ worsening financial condition;

 

(18)	The possibility of recognition of impairment losses on investment securities held by us due to declines in their value;

 

(19)	The possibility that we may record impairment losses on long-lived assets, goodwill and intangible assets;

 

(20)	The possibility that deferred tax assets may not be realized or additional liabilities for unrecognized tax benefits may be incurred; and

 

(21)	Changes in accounting principles.

Such risks, uncertainties and other factors may cause our actual results, performance, achievements or financial condition to be materially different from any future results, performance, achievements or financial condition expressed or implied by these forward-looking statements. We undertake no obligation to publicly update any forward-looking statements included in this document.

 

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2. CONSOLIDATED FINANCIAL STATEMENTS

(1) Consolidated Balance Sheets (Unaudited)

 

		March 31, 2014								September 30, 2014								Increase (Decrease)
		Amount				%				Amount				%
		(Yen in millions)
Current assets:
Cash and cash equivalents		¥	335,174							¥	297,800							¥	(37,374	)
Short-term investments in debt and equity securities			115,900								128,194								12,294
Other short-term investments			160,331								149,534								(10,797	)
Trade notes receivables			22,054								19,261								(2,793	)
Trade accounts receivables			257,850								266,008								8,158
Less allowances for doubtful accounts and sales returns			(5,062	)							(5,410	)							(348	)
Inventories			335,802								360,522								24,720
Deferred income taxes			41,499								48,243								6,744
Other current assets			103,887								103,944								57
Total current assets			1,367,435				51.9				1,368,096				49.3				661
Non-current assets:
Investments and advances:
Long-term investments in debt and equity securities			738,212								867,772								129,560
Other long-term investments			14,847								26,109								11,262
Total investments and advances			753,059				28.6				893,881				32.2				140,822
Property, plant and equipment:
Land			63,268								62,834								(434	)
Buildings			344,167								348,474								4,307
Machinery and equipment			826,881								832,367								5,486
Construction in progress			11,821								13,133								1,312
Less accumulated depreciation			(975,580	)							(985,465	)							(9,885	)
Total property, plant and equipment			270,557				10.3				271,343				9.8				786
Goodwill			116,632				4.4				117,897				4.3				1,265
Intangible assets			59,326				2.2				58,110				2.1				(1,216	)
Other assets			69,695				2.6				64,346				2.3				(5,349	)
Total non-current assets			1,269,269				48.1				1,405,577				50.7				136,308
Total assets		¥	2,636,704				100.0			¥	2,773,673				100.0			¥	136,969

 

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		March 31, 2014								September 30, 2014								Increase (Decrease)
		Amount				%				Amount				%
		(Yen in millions)
Current liabilities:
Short-term borrowings		¥	4,064							¥	4,792							¥	728
Current portion of long-term debt			12,360								10,180								(2,180	)
Trade notes and accounts payable			122,424								124,776								2,352
Other notes and accounts payable			48,224								51,043								2,819
Accrued payroll and bonus			56,068								57,357								1,289
Accrued income taxes			23,353								17,121								(6,232	)
Other accrued liabilities			31,347								54,059								22,712
Other current liabilities			29,611								32,594								2,983
Total current liabilities			327,451				12.4				351,922				12.7				24,471
Non-current liabilities:
Long-term debt			19,466								19,010								(456	)
Accrued pension and severance liabilities			36,812								32,919								(3,893	)
Deferred income taxes			235,954								263,846								27,892
Other non-current liabilities			29,795								17,634								(12,161	)
Total non-current liabilities			322,027				12.2				333,409				12.0				11,382
Total liabilities			649,478				24.6				685,331				24.7				35,853
Kyocera Corporation shareholders’ equity:
Common stock			115,703								115,703								—
Additional paid-in capital			162,666								162,733								67
Retained earnings			1,415,784								1,444,758								28,974
Accumulated other comprehensive income			250,963								321,447								70,484
Common stock in treasury, at cost			(35,033	)							(35,044	)							(11	)
Total Kyocera Corporation shareholders’ equity			1,910,083				72.5				2,009,597				72.5				99,514
Noncontrolling interests			77,143				2.9				78,745				2.8				1,602
Total equity			1,987,226				75.4				2,088,342				75.3				101,116
Total liabilities and equity		¥	2,636,704				100.0			¥	2,773,673				100.0			¥	136,969

Note: Accumulated other comprehensive income is as follows:

 

		March 31, 2014				September 30, 2014				Increase (Decrease)
		(Yen in millions)
Net unrealized gains on securities		¥	293,783			¥	344,320			¥	50,537
Net unrealized losses on derivative financial instruments			(260	)			(398	)			(138	)
Pension adjustments			(21,101	)			(21,586	)			(485	)
Foreign currency translation adjustments			(21,459	)			(889	)			20,570
Total		¥	250,963			¥	321,447			¥	70,484

 

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(2) Consolidated Statements of Income and Comprehensive Income (Unaudited)

Consolidated Statements of Income

 

		Six months ended September 30,																Increase (Decrease)
		2013								2014
		Amount				%				Amount				%				Amount				%
		(Yen in millions and shares in thousands, except per share amounts)
Net sales		¥	699,663				100.0			¥	714,329				100.0			¥	14,666				2.1
Cost of sales			518,916				74.2				525,286				73.5				6,370				1.2
Gross profit			180,747				25.8				189,043				26.5				8,296				4.6
Selling, general and administrative expenses			122,544				17.5				134,292				18.8				11,748				9.6
Profit from operations			58,203				8.3				54,751				7.7				(3,452	)			(5.9	)
Other income (expenses) :
Interest and dividend income			8,692				1.2				11,104				1.5				2,412				27.7
Interest expense			(1,022	)			(0.1	)			(880	)			(0.1	)			142				—
Foreign currency transaction gains, net			1,768				0.3				1,923				0.2				155				8.8
Other, net			1,412				0.2				1,220				0.2				(192	)			(13.6	)
Total other income (expenses)			10,850				1.6				13,367				1.8				2,517				23.2
Income before income taxes			69,053				9.9				68,118				9.5				(935	)			(1.4	)
Income taxes			23,281				3.4				21,055				2.9				(2,226	)			(9.6	)
Net income			45,772				6.5				47,063				6.6				1,291				2.8
Net income attributable to noncontrolling interests			(2,842	)			(0.4	)			(3,414	)			(0.5	)			(572	)			—
Net income attributable to shareholders of Kyocera Corporation		¥	42,930				6.1			¥	43,649				6.1			¥	719				1.7
Per share information:
Net income attributable to shareholders of Kyocera Corporation:
Basic		¥	117.02							¥	118.98
Diluted			117.02								118.98
Average number of shares of common stock outstanding:
Basic			366,875								366,866
Diluted			366,875								366,866

Notes:

(1)

Basic earnings per share attributable to shareholders of Kyocera Corporation is calculated based on the average number of shares of common stock outstanding during each period, and diluted earnings per share attributable to shareholders of Kyocera Corporation is calculated based on the diluted average number of shares of stock outstanding during each period.

(2)	“Per share information” during the six months ended September 30, 2013 is calculated under the assumption that the stock split at the ratio of two-for-one of all common stock, which took effect on October 1, 2013, had been undertaken at the beginning of the year ended March 31, 2014.

 

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Consolidated Statements of Comprehensive Income

 

		Six months ended September 30,								Increase (Decrease)
		2013				2014
		Amount				Amount				Amount
		(Yen in millions)
Net income		¥	45,772			¥	47,063			¥	1,291
Other comprehensive income (loss)—net of taxes
Net unrealized gains on securities			92,150				50,531				(41,619	)
Net unrealized losses on derivative financial instruments			(156	)			(164	)			(8	)
Pension adjustments			(511	)			(355	)			156
Foreign currency translation adjustments			21,954				23,602				1,648
Total other comprehensive income (loss)			113,437				73,614				(39,823	)
Comprehensive income			159,209				120,677				(38,532	)
Comprehensive income (loss) attributable to noncontrolling interests			(5,625	)			(6,447	)			(822	)
Comprehensive income attributable to shareholders of Kyocera Corporation		¥	153,584			¥	114,230			¥	(39,354	)

(3) Notes to the consolidated financial statements

Cautionary Statement for Premise of a Going Concern

None.

Cautionary Statement for Significant Changes in Equity

None.

 

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3. OTHER INFORMATION

Changes in accounting policies

Recently Adopted Accounting Standards

On April 1, 2014, Kyocera adopted Accounting Standards Update (ASU) No. 2013-04, “Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date.” This accounting standard requires an entity to measure obligations resulting from joint and several liability arrangements for which the total amount of the obligation within the scope of this guidance is fixed at the reporting date, as the sum of the following: (a) The amount the reporting entity agreed to pay on the basis of its arrangement among its co-obligors (b) Any additional amount the reporting entity expects to pay on behalf of its co-obligors. The accounting standard also requires an entity to disclose the nature and amount of the obligation as well as other information about those obligations. The adoption of this accounting standard did not have a material impact on Kyocera’s consolidated results of operations, financial condition and cash flows.

On April 1, 2014, Kyocera adopted ASU No. 2013-05, “Parent’s Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity.” This accounting standard resolves the diversity in practice about whether Accounting Standards Codification (ASC) 810-10, “Consolidation—Overall,” or ASC 830-30, “Foreign Currency Matters—Translation of Financial Statements,” applies to the release of the cumulative translation adjustment into net income when a parent either sells a part or all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a nonprofit activity or a business within a foreign entity. In addition, this accounting standard resolves the diversity in practice for the treatment of business combinations achieved in stages involving a foreign entity. The adoption of this accounting standard did not have a material impact on Kyocera’s consolidated results of operations, financial condition and cash flows.

On April 1, 2014, Kyocera adopted ASU No. 2013-11, “Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists.” This accounting standard requires an entity to present an unrecognized tax benefit, or a portion of an unrecognized tax benefit as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward in the financial statements. The adoption of this accounting standard did not have a material impact on Kyocera’s consolidated results of operations, financial condition and cash flows.

 

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