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Fujifilm (FUJIY) Q2 Earnings Up Y/Y, Revenues Top Estimates

Fujifilm Holdings Corporation FUJIY reported solid earnings in second-quarter fiscal 2018 (ended Sep 30, 2017). The stellar performance was stemmed by robust sales in the company’s electric imaging field, electronic materials, medical systems and electronic imaging business.

Inside the Headlines

Net income for the quarter came in at ¥27.1 billion ($244.3 million), up 21.4% year over year. Quarterly earnings per American Depositary Receipt (“ADR”) came in at 56 cents, up 14.3% year over year.

Revenues

In the reported quarter, revenues improved 8.6% year over year to ¥616.5 billion ($5,558.6 million). In addition, the top line comfortably surpassed the Zacks Consensus Estimate of $5,473 million.

Revenues from the Imaging Solutions segment — 14.6% of the total revenues — came in at roughly ¥89.9 billion ($810.4 million). The Information Solutions segment revenues came in at  ¥250.8 billion ($2,261.4 million), representing 40.7% of the total revenues, while the Document Solutions segment generated ¥275.8 billion ($2,486.8 million), accounting for 44.7% of the total revenues.

Of the total revenues, domestic revenues accounted for 41.9%, while international revenues made up the remaining 58.1%.

Fujifilm Holdings Corp. Price, Consensus and EPS Surprise

 

Fujifilm Holdings Corp. Price, Consensus and EPS Surprise | Fujifilm Holdings Corp. Quote

Costs/Margins

Gross margin in the fiscal second quarter contracted 90 basis points (bps) to 39.3%. Selling, general and administrative (SG&A), and R&D expenses were ¥202.3 billion ($1,823.8 million) or 32.8% of the total revenues.

Balance Sheet

Fujifilm exited the fiscal second quarter with cash and cash equivalents of roughly ¥682.8 billion ($6,047.7 million), down 22.1% from the figure recorded as of Mar 31, 2017. The company’s long-term debt came in at ¥437.4 billion ($3,874.3 million), marginally up 0.6% from the figure recorded at the end of fiscal 2017.

Cash Flow

In the first six months of fiscal 2018, Fujifilm’s net cash from operating activities totaled ¥111 billion ($99.7 million), while its capital expenditure summed ¥30.6 billion ($275.9 million).

Outlook

The company estimates 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.

Zacks Rank & Stocks to Consider

Fujifilm currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the same space are listed below:

Adobe Systems Incorporated ADBE sports a Zacks Rank of 1 (Strong Buy) and has an average positive earnings surprise of 7.80% for the last four quarters. You can see the complete list of today’s Zacks #1 Rank stocks here.

Agilent Technologies, Inc. A currently carries a Zacks Rank of 2 (Buy) and generated an average positive earnings surprise of 13.98% over the trailing four quarters.

Analog Devices, Inc. ADI also holds a Zacks Rank of 2 and recorded an average positive earnings surprise of 19.05% during the same time frame.

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