Fujifilm Posts Solid Half-Year Financials, But Small Net Income Decline for Latest Quarter

Fujifilm of Tokyo, Japan, today reported its latest financial results, including results for its Fujifilm Business Innovation group.

Overall Fujifilm posted solid results for the first half of its fiscal year, boosted in particular by its Healthcare business, but it posted a small (2.9 percent) net income decline for its latest quarter. And while its Healthcare business did very well for the company’s first half and second quarter, its Business Innovation unit appeared to struggle a bit, which Fujifilm attributed to costs for rebranding this year from Fujifilm Document Solutions to Fujifilm Business Innovation.

It also stated that an increase in component costs, including semiconductor costs, and component supply constraints, affected Business Innovation. Nevertheless, Fujifilm says it will expand its office-equipment sales to new regions, including Europe, the Middle-East, and Central and South America – regions it was once prohibited from selling in under its former partnership with Xerox.

Second Quarter

For its second quarter (July 1 to September 30, 2021), Fujifilm net revenue was ¥622.4 billion ($5.4 billion), up 15.0 percent year-over-year. Operating income was ¥51.5 billion ($452.8 million), up 42.9 percent year-over-year. Net income was ¥38.9 billion ($342.0 million), down 2.9 percent year-over-year.

Fujifilm Business Innovation

Fujifilm’s Business Innovation group reported second-quarter net revenue of ¥188.7 billion ($1.6 billion), down 3.4 percent year-over-year. Operating income was ¥11.4 billion ($100.2 million), down 11.3 percent year-over-year.

For comparison, in the preceding (first) quarter, Business Innovation had reported revenue of ¥186.1 billion ($1.6 billion) and operating income of ¥14.0 billion ($123.1 million).

The company stated that second-quarter results for Business Innovation were affected by rebranding expenses (rebranding Document Solutions to Business Innovation), as well as by higher costs for parts, including semiconductors, which together reduced operating income by 11.3 percent year-over-year.

Six-Month (First Half)

For the first half (April 1 to September 30, 2021) of its fiscal year, Fujifilm reported revenue of ¥1.2 trillion ($10.5 billion), up 20.8 percent. Operating income was ¥107.9 billion ($948.7 million), up 91.0 percent year-over-year. Net income was ¥96.3 billion ($846.5 million), up 42.4 percent year-over-year.

The firm said net income of ¥96.3 billion was a record high, and was due to recovery from the COVID-19 pandemic, as well as strong performances by its Healthcare and Advanced Materials businesses, as well as due to gains on its investment in an advanced bio-technology company.

Overall, Fujifilm’s Healthcare business did the best among its businesses in the first half, with operating income for the group up 152.5 percent year-over-year. Fujifilm also noted that increased sales were mainly in its Healthcare segment, including its medical-systems business and Bio-CDMO business, the latter of which contributes to production of COVID-19 vaccines at a site in the United States.

Fujifilm Business Innovation

For the first half, Fujifilm’s Business Innovation reported revenue of ¥374.8 billion ($3.2 billion), up 2.9 percent year-over-year, while operating income for the business was ¥25.5 billion ($224.1 million), down 11.3 percent year-over-year.

The company noted that its office-product business was hit by lockdowns in the Asia-Pacific region, as well as by the tight supply of semiconductors and other parts, which caused delays in equipment supply and installation.

Revenue for Business Innovation’s business-solutions business increased year-over-year due to an increase in business with Japan municipal governments, and steady performance by the BPO (Business Process Outsourcing) business, mainly overseas.

Expansion into New Markets

The company also stated it planned the launch of Fujifilm Business Innovation office equipment into new markets by the end of this year. This will include expanding to Europe, the Middle-East, and Central and South America, using the company’s overseas’ sales sites and major distributors, and will include its Aepos color MFP/printer introduced in April 2021. The firm stated it will “accelerate global expansion, including new OEM supply” for its office-equipment business.

Forecast

Fujifilm increased its forecast for its financial year that will end on March 31, 2022, to reflect the strong performance of its Bio-CDMO and Advanced Materials businesses.

It’s forecasting net revenue of ¥2.51 trillion, versus net revenue of ¥2.19 trillion for its previous fiscal year; operating income of ¥220.0 billion, versus ¥165.5 billion for its previous fiscal year; and net income of ¥175.0 billion, versus ¥181.2 billion for its previous fiscal year.

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