Brands
Q3-2016: Sony mobiles & devices div offset gains from games & pictures segments
BENGALURU: Sony Corporation reported almost flat (up 0.5 per cent) YoY sales and operating revenue (sales revenue) in the quarter ended 31 December, 2015 (Q3-2015, current quarter). However, net income attributable to stockholders (net income) was 23 per cent higher YoY. Sony reported sales of ?2580.8 billion as compared to the ?2466.7 billion in Q3-2015. The company reported net income attributable to Sony shareholders of ?95.25 billion in Q3-2016 as compared to f ?79.96 billion in the corresponding year ago quarter.
Sony says that sales were essentially flat YoY mainly due to due to increases in Game & Network Services (G&NS) segment sales, reflecting a significant increase in PlayStation4 (PS4) software sales, and in Pictures segment sales, reflecting a significant increase in Motion Pictures sales, substantially offset by decreases in Mobile Communications (MC) segment sales, reflecting a significant decrease in smartphone unit sales, and in Devices segment sales, primarily reflecting a significant decrease in image sensor sales. On a constant currency basis, sales were essentially flat year-on-year says the company.
Segment Performance
Mobile Communications
Sony’s MC segment reported a 14.7 per cent decline in sales to ?384.5 billion in the current quarter as compared to the ?450.9 billion in Q3-2015, which Sony says was due to a significant decrease in smartphone unit sales resulting from a strategic decision not to pursue scale in order to improve profitability.
Consequently the segment reported a higher operating profit of ?24.1 billion in Q3-2016 as compared to ?10.4 billion in Q3-2015. Sony says that this was due to an improvement in product mix reflecting a shift to high value-added models, as well as reductions in costs including marketing, research and development and other selling, general and administrative expenses, partially offset by the above-mentioned decrease in smartphone unit sales and the negative impact of the appreciation of the US dollar, reflecting the high ratio of US dollar-denominated costs.
Game & Network Services (G&NS)
GN&S segment reported a 10.5 per cent increase in sales to ?531.5 billion in Q3-2016 as compared to the ?309.5 million in Q3-2015, which Sony says was primarily due to an increase in PS4 software sales as well as the impact of foreign exchange rates, partially offset by a decrease in PlayStation3 (PS3) software sales.
This segment’s Operating Income increased 45.5 per cent to ?40.2 billion in Q3-2016 as compared to the ?27.6 billion in Q3-2015. The gain due to to the increase in PS4 software sales as well as the absence in the current quarter of an 11.2 billion yen write-down of PS Vita and PS TV components recorded in the same quarter of the previous fiscal year. Partially offsetting the increase in operating income were the negative impact of the appreciation of the US dollar, reflecting the high ratio of US dollar-denominated costs, and the decrease in PS3 software sales.
Imaging Products & Solutions (IP&S)
IP&S segment reported a five per cent decline in sales to ?191.9 billion in the current quarter as compared to the ?201.9 billion in Q3-2015 due to decreases in unit sales of video cameras and digital cameras reflecting a contraction of the market, partially offset by an improvement in the product mix of digital cameras reflecting a shift to high value-added models.
IP&S operating income increased 28.6 per cent to ?25.9 billion in Q3-2016 as compared to the ?20.1 billion in Q3-2015. During the current quarter there was a 1.9 billion yen positive impact from foreign exchange rate fluctuations says Sony.
Home Entertainment & Sound (HE&S)
Sony’s HE&S segment reported 4.3 per cent decline in revenue to ?402.2 billion in the current quarter as compared to the ?420.2 billion in Q3-2015 due to a decrease in unit sales of LCD televisions, and a decrease in home audio and video unit sales, reflecting a contraction of the market, as well as the impact of foreign exchange rates, partially offset by an improvement in the product mix of LCD televisions, reflecting a shift to high value-added model.
HE&S operating income reported 19.8 per cent growth in operating income to ?31.2 billion in Q3-2016 as compared to the ?26 billion in Q3-2015 reductions and an improvement in product mix, partially offset by the negative impact of the appreciation of the US dollar, reflecting the high ratio of US dollar-denominated costs, as well as the impact of the above-mentioned decrease in sales.
In Television, sales were flat YoY as ?288.5 billion. This was primarily due to a decrease in LCD television unit sales resulting from a strategic decision not to pursue scale in order to improve profitability and the impact of foreign exchange rates, substantially offset by the improvement in product mix reflecting a shift to high value-added models. Operating income increased ?6.6 billion yen YoY to ?15.9 billion. This increase was primarily due to cost reductions and the improvement in product mix, partially offset by the negative impact of the appreciation of the US dollar, reflecting the high ratio of US dollar-denominated costs, and the impact of the decrease in unit sales.
Devices
Devices Sales reduced 12.6 per cent YoY to ?249.9 billion in the current quarter from ?285.9 billion. This increase was primarily due to the impact of foreign exchange rates and an increase in demand for image sensors, partially offset by a decrease in battery business sales. Sales to external customers increased 17.3 per cent YoY.
Operating income of the segment in Q3-2016 increased ?4.4 billion YoY to ?32.7 billion from ?28.3 billion in Q3-2015. This decrease was primarily due to a significant decrease in sales of image sensors, reflecting a decrease in demand for mobile products, and a significant decrease in battery business sales. This sales decrease was partially offset by an increase in sales of camera modules, which were lower than originally forecasted and the impact of foreign exchange rates. Sales to external customers decreased 7.5 per cent year-on-year.
The segment reported an operating loss of ?11.7 billion in the current quarter as compared to an operating profit of ?53.8 billion in Q3-2015. This deterioration was primarily due to the deterioration in the operating results of the battery business, including the recording of a ?30.6 billion impairment charge related to long-lived assets, increases in depreciation and amortisation expenses as well as in research and development expenses for image sensors and camera modules, and the impact of the decrease in sales of image sensors.
Pictures
Sony’s Pictures segment reported 26.9 per cent growth in sales to ?262.1 billion in Q3-2016 as compared to the ?206.6 billion in Q3-2015. The increase in sales on a US dollar basis was primarily due to significantly higher sales for Motion Pictures, partially offset by the impact of foreign exchange rates. The increase in Motion Pictures sales was primarily driven by higher theatrical revenues, as the current quarter benefitted from the strong worldwide theatrical performances of Spectre and Hotel Transylvania 2, partially offset by lower home entertainment revenues, as the same quarter of the previous fiscal year benefitted from the home entertainment performances of 22 Jump Street and The Equalizer.
Operating income in the current quarter more than tripled (3.27 time) at ?20.4 billion YoY from ?6.2 billion from ?1 billion in Q3-2014 due to the impact of the above-mentioned increase in sales, partially offset by higher theatrical marketing expenses. The increase in operating income also reflects lower overhead expenses as compared to the same quarter of the previous fiscal year, primarily due to a reduction in incentive compensation expense as well as insurance recoveries related to losses incurred from the cyberattack on SPE’s network and IT infrastructure in the fall of 2014.
Music
Music reported 8.2 per cent increase in sales to ?18.1 billion in Q3-2016 as compared to the ?167.5 billion in Q3-2015 due to the impact of the depreciation of the yen against the US dollar. Sony says that the increase in sales on a constant currency basis was due to higher Recorded Music sales, reflecting an increase in digital streaming revenue, and higher Visual Media and Platform sales, reflecting the strong performance of a game application for mobile devices. The current quarter includes record-breaking sales of Adele’s new album 25. Other best-selling titles included One Direction’s Made in the A.M., Elvis Presley’s If I Can Dream: Elvis Presley with the Royal Philharmonic Orchestra and Bruce Springsteen’s The Ties That Bind: The River Collection.
Operating income increased ?1.5 billion year-on-year to ?27.4 billion ($228 million). This increase was primarily due to the above-mentioned increase in sales in Recorded Music and Visual Media and Platform.
Operating income increased ?2.4 billion to ?14.6 billion. This increase was primarily due to an improvement in product mix, reflecting an increase in digital streaming revenues says Sony.
Financial services
Financial services increased 5.6 per cent YoY to ?322.0 billion primarily due to an increase in revenue at Sony Life. Revenue at Sony Life increased 5.7 per cent year-on-year to ?295.0 billion mainly due to an increase in insurance premium revenue reflecting a steady increase in policy amount in force.
Operating income of ?52.2 billion was recorded, essentially flat YoY. At Sony Life, operating income of ?51.6 billion was recorded, essentially flat YoY, mainly due to the above-mentioned increase in insurance premium revenue, substantially offset by an increase in operating expenses.
Other
Sales decreased 17.7 per cent YoY in Q3-2016 to ?5196.8 billion.
Operating income of ?515.7 billion was recorded in Q3-2016, compared to an operating loss of ?5112.6 billion in the same quarter of the previous fiscal year. This improvement was primarily due to a decrease in PC exit costs, including restructuring charges and after-sales service expenses, as well as the absence in the current quarter of sales company fixed costs charged to the PC business in the same quarter of the previous fiscal year, which were allocated based on the prior year results says Sony.
Brands
Rohini Laya Venkateswaran named executive director at Gillette India
P&G veteran with two decades of experience steps into leadership role
NEW DELHI: Rohini Laya Venkateswaran has been appointed executive director at Gillette India Pvt. Ltd., bringing with her more than two decades of experience across sales, strategy and brand leadership within the consumer goods sector. In her new role, she will help steer the company’s strategic direction and growth while strengthening its footprint in the grooming and personal care category.
Venkateswaran joins the board after a long career at Procter & Gamble, where she spent nearly 21 years shaping sales strategy, building brands and driving market expansion across India and international markets.
Most recently, she served as chief sales officer for India at P&G. Prior to that, she was vice president and country manager for east gulf markets, overseeing operations in Kuwait, Oman, Bahrain and Qatar while also guiding sales strategy across the Gulf region, including the UAE.
Earlier in her career, she led sales strategy and planning for India while serving as marketing leader for brands such as Olay and Old Spice. During this stint, she focused on reshaping go-to-market channels and building awareness through digital, social and influencer-led campaigns to drive growth.
Her journey at P&G also included roles such as director sales strategy and planning leader India, associate director modern retail and ecommerce, regional manager for Delhi and Rajasthan, and several key account and trade marketing roles across the country. She also spent time in the United States working on the P&G Walmart international team, collaborating on global retail initiatives.
Venkateswaran holds an MBA in marketing from SP Jain Institute of Management and Research and a bachelor’s degree in mechanical engineering from RV College of Engineering.
With her mix of sales acumen, brand-building experience and global exposure, Venkateswaran’s appointment signals a sharpened focus on growth and market leadership for Gillette India.
