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Fujifilm (FUJIY) Beats on Earnings, Misses Revenues in Q4

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Premium photographic image-product company, Fujifilm Holdings Corporation (FUJIY - Free Report) reported mixed results for fourth-quarter fiscal 2017 (ended Mar 31, 2017).

Inside the Headlines

Net income for the quarter was ¥52.3 billion ($460.5 million), remarkably up 51.7% year over year. Quarterly earnings per American Depositary Receipt (“ADR”) came in at $1.08, surging 45.9% year over year. The bottom line also surpassed the Zacks Consensus Estimate of 57 cents.

Net income for fiscal 2017 came in at ¥131.5 billion ($1214.3 million) , up 18% year over year.

Under the guidelines of the VISION 2016 plan (Apr 1, 2014 to Mar 31, 2017), Fujifilm has sucessfully boosted its profitability on the back of three major pillars – efficient management, expansion of international operations and launch of businesses.

Revenues

In the quarter, revenues edged down 0.9% year over year to ¥629.9 billion ($5,544.9 million). In addition, the top line missed the Zacks Consensus Estimate of $6,041 million.

Revenues from the Imaging Solutions segment – 13.4% of the total revenue – came in at roughly ¥85 billion ($747.9 million). The Information Solutions segment’s revenue was ¥257.4 billion ($2,265.5 million), representing 40.8% of the total revenue, while the Document Solutions segment generated ¥290.8 billion ($2,560.2 million), accounting for 45.8% of the total revenue.

Of the total revenue, domestic revenues accounted for 43.1%, while international revenues made up the remaining 56.9%.

Revenues for fiscal 2017 came in at ¥2,322.2 billion, down 5.6% year over year.

Costs/Margins

Gross margin in the fiscal fourth quarter was 39.4%, up 130 basis points (bps) year over year. Selling, general and administrative (SG&A) and R&D expenses were ¥193 billion ($1,699 million) or 30.6% of the total revenue.

Gross margin for fiscal 2017 came in at 40.1%, expanding 80 bps year over year.

Balance Sheet

Fujifilm exited the fiscal fourth quarter with cash and cash equivalents of roughly ¥876 billion ($7,870.2 million), up 45.8% from the figure recorded as of Mar 31, 2016. The company’s long-term debt came in at ¥434.8 billion ($3,906.9 million), up 40.1% from the figure recorded at the end of fiscal 2016.

Cash Flow

In fiscal 2017, Fujifilm’s net cash from operating activities totaled ¥288.6 billion ($2,665 million), while its capital expenditure was ¥74.6 billion ($689.3 million).

Outlook

The company expects a 5.9% year-over-year rise in revenues to ¥2,460 billion in fiscal 2018. Operating income is projected at ¥185 billion, reflecting 7.4% growth from fiscal 2017. However, net income for fiscal 2018 is estimated to be down 4.9% year over year to ¥125 billion. This will result in earnings per share of ¥285.55.

Stocks to Consider

Some better-ranked stocks in the industry are listed below:

Applied Optoelectronics, Inc. (AAOI - Free Report) generated an outstanding average positive earnings surprise of 118.33% over the trailing four quarters and currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Agilent Technologies, Inc. (A - Free Report) has an average positive earnings surprise of 11.68% for the last four quarters and carries a Zacks Rank #2 (Buy), at present.

Axcelis Technologies, Inc. (ACLS - Free Report) also holds a Zacks Rank #2 and has an impressive average positive earnings surprise of 135.78% for the past four quarters.

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