Elpida Memory Revises Financial Forecast for the Third Quarter FY2005
TOKYO, JAPAN, January 13, 2006 - Elpida Memory, Inc. (Elpida), Japan's leading global supplier of Dynamic Random Access Memory (DRAM), today announced the revision of its financial forecast for the third quarter of FY2005, which ended on December 31, 2005 (our previous forecast was announced on October 25, 2005).
- Revision of financial forecast for the third quarter ended December 31, 2005
(Millions of Yen)
Net sales Operating income Ordinary income Net income Previous Forecast (Oct 25, 2005) (a) 58,000 - 63,000 1,500 - 4,500 500 - 3,500 1,000 - 4,000 Revised Forecast (b) 59,000 650 (700) 160 Change from previous forecast (b-a) 1,000 - (4,000) (850) - (3,850) (1,200) - (4,200) (840) - (3,840) Change (%) 1.7% - (6.3%) (56.7%) - (85.6%) - (84.0%) - (96.0%) Results of 2Q FY 2005 (c) 57,467 (2,513) (3,685) (3,038) Change from the 2Q FY 2005 (b-c) 1,533 3,163 2,985 3,198
- Reasons for Revision
Owing to an 11% bit shipment increase and an improved product mix in the third quarter (3Q), we now expect net sales for the 3Q to exceed the prior quarter net sales by 1.5 billion yen.
In addition, although the start of operations in Area 2 of E300 should enable us to achieve an operating profit in the 3Q for the first time since 4Q FY 2004, we now believe that actual profit results will fall below the forecasted amounts we announced last October. The main reason for this change in profit outlook is that, given an approximate 25% drop in spot market prices for 512Mb DDR2 during the 3Q, our average selling price for DRAMs has suffered a 7% decline, which was greater than the maximum 5% drop contained in our earlier outlook.
We now expect to book an extraordinary profit of approximately 1.0 billion yen based on the sale of fixed assets.
We plan to release the actual details concerning our 3Q results after the closing of the morning market session of the Tokyo Stock Exchange on January 24, 2006. At that same time, we also intend to comment on our 4Q FY 2005 forecast in light of our 3Q results, the latest market conditions and other factors.
Note: These above forecasts are forward-looking statements that are based on management's view from the information available at the time of this Report. These statements involve risks and uncertainties. Actual results may be materially different from those discussed in the forward-looking statements. The factors that may affect Elpida include, but are not limited to, changes in the DRAM market and industry environment, changes in technologies and design, problems related to our supply of key material and equipment, loss of or decreased demand from key customers, changes in exchange rates, general economic conditions and natural disasters. We disclaim any obligation to update or, except in the limited circumstances required by the Tokyo Stock Exchange, announce publicly any revision to any of the forward-looking statements.
Information in this news release is current as of the timing of the release, but may be revised later without notice.