Nihon Kohden Completes Interim Review of Consolidated Financial Results
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Nihon Kohden : Completion of the Interim Review by Certified Public Accountants, etc. of the Consolidated Financial Results for the 1Q of the FY2024 (Japan GAAP)
(Applying of Specific Accounting of the Consolidated Quarterly Financial Statements) 1. Qualitative Information on Financial Results for the Period (1) Operating Results Analysis During the term under review (April 1, 2024 to June 30, 2024), the global economic outlook remained uncertain due to tight monetary policy in the U.S. and Europe as well as higher geopolitical risks. In Japan, each medical institution strove to implement task shifting and improve its operational efficiency, as work style reforms for medical staff took effect in April 2024 and medical treatment fees were revised in June 2024. However, business sentiment in medical institutions deteriorated due to difficulties in securing medical professionals. Internationally, capital expenditure in China was still cautious due to the impact of the anti- corruption campaign and economic slowdown. In the U.S., hospital finance showed a trend of improvement as the number of testing and surgical procedures increased. Medical institutions both in Japan and internationally have promoted medical digital transformation, which includes data health, telemedicine, and utilization of AI and ICT, because they need to urgently improve the quality and efficiency of medical care. Under these circumstances, Nihon Kohden implemented its Three-year Business Plan, BEACON 2030 Phase II, starting from FY2024. The Company aims to achieve targets for three indicators: growth, profitability, and capital efficiency, by conducting six key measures including "Enhance product competitiveness", "Focus on growth of North America Business", and "Implement the reform of the profit structure". Japan: Nihon Kohden concentrated on enhancing sales activities which match each market; the acute care hospital market, the small and mid-sized hospital market, and the clinic market. The Company also focused on its consumables and services business as well as strengthening its marketing and service capabilities, creating customer value which contributed to improving medical safety, patient outcomes, and operating efficiency. Sales decreased due to a reactionary decline in sales of IT systems compared to the strong growth due to large orders in the same period of the previous fiscal year, while sales of consumables and services increased. Sales in the university and private hospital markets decreased and sales in the public hospital market remained flat. Sales in the clinic market increased favorably. Sales of Patient Monitors and Physiological Measuring Equipment decreased due to lower sales of IT systems. Sales of Other Medical Equipment remained flat. Sales of Treatment Equipment increased favorably, mainly due to sales of AEDs and ventilators. As a result, domestic sales decreased 2.2% over the first quarter of FY2023 to ¥29,493 million. International: Overseas sales decreased, due to the impact of a change in the fiscal term of Defibtech, LLC according to the reorganization of subsidiaries in the U.S. in the same period of the previous fiscal year. Another reason was that sales in Asia & Other decreased, mainly in China. In North America, sales of patient monitors, ventilators, and neurology products increased favorably, while sales of AEDs decreased. Sales in Latin America achieved double-digit growth, mainly in Brazil and Mexico. Sales in Europe decreased, as sales of AEDs decreased mainly in the Netherlands and the U.K., while sales in Germany increased. Sales in Asia & Other decreased, as sales in China and the Middle East decreased compared to the strong growth in the same period of the previous fiscal year, as well as lower sales in Southeast Asia. Sales of Treatment Equipment and Physiological Measuring Equipment decreased, while sales of Patient Monitors and Other Medical Equipment increased. As a result, international sales decreased 9.9% over the first quarter of FY2023 to ¥16,734 million. As a result of the above, overall sales during the term under review decreased 5.1% over the first quarter of FY2023 to ¥46,227 million. Due to decreased sales and lower gross profit margin, operating loss of ¥1,248 million was recorded, compared to operating income of ¥2,205 million in the first quarter of FY2023. This was also because domestic gross profit margin of in-house products such as IT systems decreased and inventory write-down of a discontinued model was recorded. Ordinary income decreased 71.1% to ¥1,674 million and income attributable to owners of parent decreased 79.8% to ¥766 million over the first quarter of FY2023, reflecting foreign exchange gains. Consolidated Sales Results by Product Category
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Nihon Kohden : Consolidated Financial Results (Japan GAAP) (Notice Regarding Completion of the Interim Review by Certified Public Accountants, etc.)
(Applying of Specific Accounting of the Consolidated Quarterly Financial Statements) 1. Qualitative Information on Financial Results for the Period (1) Operating Results Analysis During the term under review (April 1, 2024 to June 30, 2024), the global economic outlook remained uncertain due to tight monetary policy in the U.S. and Europe as well as higher geopolitical risks. In Japan, each medical institution strove to implement task shifting and improve its operational efficiency, as work style reforms for medical staff took effect in April 2024 and medical treatment fees were revised in June 2024. However, business sentiment in medical institutions deteriorated due to difficulties in securing medical professionals. Internationally, capital expenditure in China was still cautious due to the impact of the anti- corruption campaign and economic slowdown. In the U.S., hospital finance showed a trend of improvement as the number of testing and surgical procedures increased. Medical institutions both in Japan and internationally have promoted medical digital transformation, which includes data health, telemedicine, and utilization of AI and ICT, because they need to urgently improve the quality and efficiency of medical care. Under these circumstances, Nihon Kohden implemented its Three-year Business Plan, BEACON 2030 Phase II, starting from FY2024. The Company aims to achieve targets for three indicators: growth, profitability, and capital efficiency, by conducting six key measures including "Enhance product competitiveness", "Focus on growth of North America Business", and "Implement the reform of the profit structure". Japan: Nihon Kohden concentrated on enhancing sales activities which match each market; the acute care hospital market, the small and mid-sized hospital market, and the clinic market. The Company also focused on its consumables and services business as well as strengthening its marketing and service capabilities, creating customer value which contributed to improving medical safety, patient outcomes, and operating efficiency. Sales decreased due to a reactionary decline in sales of IT systems compared to the strong growth due to large orders in the same period of the previous fiscal year, while sales of consumables and services increased. Sales in the university and private hospital markets decreased and sales in the public hospital market remained flat. Sales in the clinic market increased favorably. Sales of Patient Monitors and Physiological Measuring Equipment decreased due to lower sales of IT systems. Sales of Other Medical Equipment remained flat. Sales of Treatment Equipment increased favorably, mainly due to sales of AEDs and ventilators. As a result, domestic sales decreased 2.2% over the first quarter of FY2023 to ¥29,493 million. International: Overseas sales decreased, due to the impact of a change in the fiscal term of Defibtech, LLC according to the reorganization of subsidiaries in the U.S. in the same period of the previous fiscal year. Another reason was that sales in Asia & Other decreased, mainly in China. In North America, sales of patient monitors, ventilators, and neurology products increased favorably, while sales of AEDs decreased. Sales in Latin America achieved double-digit growth, mainly in Brazil and Mexico. Sales in Europe decreased, as sales of AEDs decreased mainly in the Netherlands and the U.K., while sales in Germany increased. Sales in Asia & Other decreased, as sales in China and the Middle East decreased compared to the strong growth in the same period of the previous fiscal year, as well as lower sales in Southeast Asia. Sales of Treatment Equipment and Physiological Measuring Equipment decreased, while sales of Patient Monitors and Other Medical Equipment increased. As a result, international sales decreased 9.9% over the first quarter of FY2023 to ¥16,734 million. As a result of the above, overall sales during the term under review decreased 5.1% over the first quarter of FY2023 to ¥46,227 million. Due to decreased sales and lower gross profit margin, operating loss of ¥1,248 million was recorded, compared to operating income of ¥2,205 million in the first quarter of FY2023. This was also because domestic gross profit margin of in-house products such as IT systems decreased and inventory write-down of a discontinued model was recorded. Ordinary income decreased 71.1% to ¥1,674 million and income attributable to owners of parent decreased 79.8% to ¥766 million over the first quarter of FY2023, reflecting foreign exchange gains. Consolidated Sales Results by Product Category
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Nihon Kohden Corporation, a leading medical device manufacturer, has announced the completion of the interim review of its consolidated financial results for the first half of the fiscal year ending March 31, 2024. The review was conducted by certified public accountants and audit corporations.
Interim Review Completion
Nihon Kohden Corporation, a prominent player in the medical device industry, has successfully completed the interim review of its consolidated financial results for the first half of the fiscal year ending March 31, 2024
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. The review was conducted by certified public accountants and audit corporations, adding credibility to the company's financial reporting.Financial Results Overview
The reviewed financial results cover the period from April 1, 2023, to September 30, 2023. Nihon Kohden's performance during this period reflects the company's operations in the challenging healthcare market
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. The completion of this review process is a crucial step in providing transparent and accurate financial information to stakeholders.Importance of the Interim Review
The interim review serves several important purposes:
- Ensuring Accuracy: It helps verify the accuracy of the financial statements, providing assurance to investors and regulatory bodies
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. - Compliance: The review ensures that Nihon Kohden's financial reporting complies with Japan GAAP (Generally Accepted Accounting Principles)
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. - Transparency: It demonstrates the company's commitment to transparency in its financial dealings.
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Impact on Stakeholders
The completion of this review is significant for various stakeholders:
- Investors: It provides them with reliable financial information to make informed decisions about their investments in Nihon Kohden
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. - Regulatory Bodies: It assures compliance with financial reporting standards and regulations.
- Company Management: It offers an external perspective on the company's financial health and reporting practices.
Looking Ahead
While the interim review provides a snapshot of Nihon Kohden's financial position for the first half of the fiscal year, it also sets the stage for the company's performance in the latter half. Stakeholders will be keenly watching how these results translate into full-year performance and strategic decisions by the company
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.As the medical device industry continues to evolve, Nihon Kohden's financial stability and transparency will play crucial roles in maintaining its market position and investor confidence. The completion of this interim review marks an important milestone in the company's fiscal year and its ongoing commitment to financial integrity.
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