Financial Data and Key Indicator Changes - For Q3 2021, net sales increased to ¥2.3551 trillion, a year-on-year increase of ¥255.6 billion or 12% [16] - Operating income rose to ¥87.6 billion, an increase of ¥63.6 billion year-on-year [16] - Net income, excluding tax expenses, reached ¥114.9 billion, up ¥71.3 billion from the previous year [16] Business Line Data and Key Indicator Changes - Energy Systems & Solutions: Net sales were ¥361.5 billion, up ¥58 billion year-on-year, with operating income increasing by ¥14.3 billion to ¥8.1 billion [20] - Infrastructure Systems & Solutions: Net sales were ¥416.6 billion, with operating income at ¥6.9 billion, impacted by COVID-19 and semiconductor shortages [21] - Building Solutions: Net sales increased to ¥434.5 billion, with operating income at ¥17.9 billion, driven by recovery in air conditioning and elevators [22] - Electronic Devices & Storage Solutions: Net sales reached ¥659.8 billion, up ¥143 billion year-on-year, with operating income increasing by ¥48.5 billion to ¥55.8 billion [23] - Retail & Printing Digital Solutions: Net sales were ¥334.6 billion, with operating income recovering to ¥8.3 billion [24] - Digital Solutions: Net sales increased to ¥156.1 billion, with operating income at ¥13.2 billion, up by ¥4.1 billion [25] Market Data and Key Indicator Changes - Orders received increased by 11% year-on-year during the first nine months of the fiscal year [26] - Order backlog increased by 3% compared to the same period last year [26] Company Strategy and Development Direction - The company is pursuing a strategic reorganization plan, including a two-way spin-off to eliminate conglomerate discount and enhance shareholder value [7][12] - The management aims to achieve efficient capital allocation and focused management through the spin-off [7] - The company is engaging in continuous dialogue with potential partners to align interests for collaboration [11] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the ongoing impact of soaring material and logistics costs, as well as semiconductor shortages, which are expected to continue affecting performance [15][17] - The company revised its full-year performance forecast downward due to these challenges, projecting net sales of ¥3.34 trillion and operating income of ¥155 billion [28][31] Other Important Information - The company plans to hold an Extraordinary General Meeting of Shareholders on March 24 to confirm shareholder opinions on the strategic reorganization [5][6] - A capital surplus of ¥300 billion is expected over the next two years, which will be used for shareholder returns [10] Q&A Session Summary Question: Concerns about shareholder approval for the strategic reorganization - Management clarified that the current proposal seeks a simple majority for approval, not a two-thirds majority, to respect the wishes of the majority of shareholders [36][37] Question: Expectations for shareholder support and share price reactions - Management expressed confidence in receiving support from shareholders and acknowledged the complexity of share price fluctuations [42][43] Question: Feedback from shareholders and employees regarding the reorganization - Management indicated that various opinions have been received from shareholders and employees, and they are committed to listening and making improvements [52][54] Question: Governance structure and delays in director selection - Management explained that the delay in selecting directors is due to the ongoing spin-off process and the need to identify suitable candidates with the right expertise [75][78] Question: Impact of the two-way split on business operations - Management confirmed that the core business focus remains unchanged, and the two-way split is intended to enhance operational efficiency [77][79]
Toshiba(TOSYY) - 2022 Q3 - Earnings Call Transcript