Murata Manufacturing Co., Ltd. Business Report FY ended Mar. 2017

Financial Overview

(in millions of JPY)
FY ended Mar. 31, 2017 FY ended Mar. 31, 2016 Rate of Change (%) Main factors
Sales 1,135,524 1,210,841 16.0 -Sales increased year-on-year due to a sales focus on growing markets and favorable currency translation due to the weak yen.
Operating income 201,215 275,406 28.4 -Although the Company’s business performance as impacted by negative factors such as higher fixed expenses in line with greater production capacity, and lower product selling prices, income grew significantly due to launching new products with higher added value, making better utilization of production capacity, implementing cost-cutting initiatives, and reaping the benefits of favorable currency translation due to the weak yen.
Profit for the year attributable to owners of the parent 156,060 203,776 21.5 -
Automotive Electronics
Sales 168,700 152,800 10.4 1)

1) Sales of Products Used For Car Electronics
-Robust sales of automotive condensers due to greater vehicle electrification.
-Significantly higher sales of ultrasonic sensors for automotive safety devices.
-Continued reduction in sales of power-sources and modules for car audio systems.

Product Development

Developed Surface Mounted Piezoelectric Sounder
-The Company announced that it has developed a surface mounted piezoelectric sounder that produces the world's most detectable volume for automotive applications. Mass production of the new sounder began in October 2016. Murata applied its unique materials technology and high-level manufacturing processes to produce the new piezoelectric sounder, which yields four times the sound pressure of previous Murata products for an increase of 10 to 12 dB. It supports reflow mounting to assure high reliability. Piezoelectric sounders emit sound by using a piezoelectric effect. The piezoelectric effect causes a sound generating object to vibrate when an electric signal is applied. In line with the development of advanced driver assistance systems, the man‐machine interface has been increasing in importance. This requires sound emitting parts to make louder sound in issuing warnings and notifications. Murata's piezoelectric sounder meets these needs. (From an article in the Nikkan Jidosha Shimbun on February 21, 2017)

Developed Smallest Multilayer Capacitor
-The Company announced that it has developed its smallest (1.6 mm x 0.8 mm) three-terminal ceramic multilayer capacitor for automobiles. The company is aiming to win orders for the new product, which is used in preventive safety systems like advanced driver assistance systems (ADASs) and autonomous driving systems. The three-terminal ceramic multilayer capacitor, which has a lower equivalent series inductance than general two-terminal multilayer ceramic capacitors, is capable of reducing high-frequency inductances with a small number of components. Three-terminal ceramic multilayer capacitors are increasingly used in ADASs, as well as autonomous driving and infotainment systems, which require greater processor sophistication and downsizing. Murata Manufacturing has already started delivery of sample products, and will start mass production in April. (From an article in the Nikkan Jidosha Shimbun on February 15, 2017)

Developed High-performance Accelerometers
-The Company announced the SCA3000 series of high performance three axis MEMS accelerometers aimed at a broad range of industrial and automotive applications. Target applications for the SCA3000 include leveling and alignment systems, inertial measurement units for heavy machinery, navigation systems, AGVs, and construction and surveying tools. There is also a wide range of different future applications in high accuracy automotive inertial sensing, like in autonomous driving (ADAS) and intelligent transmission control that can be enabled by this sensor. (From a press release on December 5, 2016)

Developed Isolated-type DC-DC Converters
-The Company has developed the MYIS series of compact surface mounted isolated type DC-DC converters for on-board applications. These converters can be used in the 2-battery system of an electric vehicles (EV), hybrid vehicles (HEV), and plug-in hybrid vehicles (PHEV), and also in the charging system of an EV and PHEV. Mass production is scheduled to start at Murata Electronics (Thailand), Ltd. in December 2016. The price of a sample is JPY 1,000. (From a press release on August 18, 2016)

Developed Wire-wound Inductors
-The Company has introduced LQW15CN_0Z/1Z series of AEC-Q200-compliant wire-wound inductors that are ideal for automotive camera applications and NFC circuits. This small inductor can obtain large inductance, and is expected to help designers efficiently configure the BiasTee circuits used in vehicle-mounted cameras. The inductor can also be used for NFC matching circuits, which benefit from the low-loss characteristics of winding type inductors. (From a press release on July 22, 2016)

Developed High Q-Grade Monolithic Ceramic Capacitors
-The Company has developed the world's first automotive grade monolithic ceramic capacitors "GCQ series" with high Q characteristics for vehicle to X (V2X) applications. These high Q capacitors comply with AEC-Q200 requirements and are suitable for V2X, ADAS, and other automotive communication applications. Sample shipments have already commenced, and Murata will be gearing up to mass-produce the components in the first half of 2016. (From a press release on April 20, 2016)


-The Company announced that Murata Electronics Europe B.V., a wholly-owned subsidiary of Murata has completed the acquisition of IPDiA, headquartered in France, and IPDiA has become a subsidiary of Murata as October 17. It is part of Murata's strategy to strengthen its core business within the communication (mobile) market, and to expand into new applications within the automotive and medical markets. (From a press release on October 18, 2016)

-Murata Manufacturing Co., Ltd. announced that it has signed an agreement, under which its Dutch subsidiary, Murata Electronics Europe B.V., will acquire the shares of France-based IPDiA S.A. IPDiA designs, develops, manufactures, and sells silicon-based passive devices and especially produces 3D silicon capacitors for medical, industrial, communication applications. It has a workforce of 130 employees in France and Canada. Through this acquisition, Murata is aiming to enhance its capacitor business in the communication, automotive, and medical markets. The transaction is scheduled to be completed by the end of October 2016. (From a press release on October 12, 2016)

Business Alliances

Formed Business Alliance with Shizuki Electric
-The Company and Shizuki Electric Co., Inc. (Shizuki Electric) have reached an agreement on a business capital tie-up. The two companies established a joint venture for film capacitors on October 3. They will combine their respective technologies and develop new film capacitors using high heat resistance material, which will contribute to the simplification of cooling mechanisms for electric vehicles. They are aiming to start mass production of film capacitors in two years’ time. The joint venture, Murata Shizuki FC Solutions Co., Ltd., has JPY 100 million in capital. Murata Manufacturing owns 65% and Shizuki Electric owns 35%. Their new film capacitor material, which utilizes Murata Manufacturing's ceramic capacitor technology and Shizuki Electric's film capacitor technology, has heat resistance of 125 degrees centigrade. The new joint venture will develop, manufacture, and sell film capacitors using the new material. The film capacitors are expected to be used in cooling mechanisms for power drive and air conditioning systems for electric and hybrid vehicles. (From an article in the Nikkan Jidosha Shimbun on October 4, 2016)


Acquiring Sony’s Battery Business
-The Company and Sony Corporation (Sony) announced that they aim to complete the transfer of battery business from Sony to Murata by early July 2017 in light of the current review status of the required regulatory approvals. According to their press release on October 31, 2016, the target closing date was early April 2017. (From a press release on February 15, 2017)

-The Company and Sony announced that they have signed a binding definitive agreement to transfer the Sony Group's battery business to the Murata Group. Murata and Sony had previously announced on July 28, 2016 that they had entered into a non-binding MOU regarding the transfer. The sales price is approximately 17.5 billion yen. Murata is planning to offer the approximately 8,500 Sony Group employees employment within the Murata Group upon the completion of the transfer. Murata and Sony are aiming to complete the transfer by early April 2017, subject to required regulatory approvals and other conditions. (From a press release on October 31, 2016)

-The Company and Sony Corporation (Sony) announced that they have reached agreement to transfer Sony's battery business to the Murata Manufacturing Group. A firm commitment will be concluded in mid-October, and the transfer completed by the end of March 2017. The businesses that will be affected includes the battery business of Sony's subsidiary, Sony Energy Devices Corporation, Sony's battery plants in China and Singapore, and the assets and personnel that belong to Sony Group's battery sales and R&D sites in and outside Japan. The transfer will not include sales of consumer batteries like Sony brand USB portable batteries, alkaline, button and coin batteries, and mobile projectors. (From an article in the Nikkan Jidosha Shimbun on August 9, 2016)

Outlook for FY ending Mar. 31, 2018

(in millions of JPY)
FY ended Mar. 31, 2018
FY ended Mar. 31, 2017
Rate of Change
Sales 1,225,000 1,135,524 7.9
Operating income 226,000 201,215 12.3
Profit for the year attributable to owners of the parent 174,000 156,060 11.5

*Sales of products used for car electronics are forecast to increase 13% year-on-year.

>>>Financial Forecast for the Next Fiscal Year (Sales, Operating Income, etc.)

R&D Expenditure

(in millions of JPY)
FY ended Mar. 31, 2017 FY ended Mar. 31, 2016 FY ended Mar. 31, 2015
Components 37,887 32,888 31,133
Modules 28,828 31,465 20,040
Others 24 45 37
Headquarters 15,070 13,584 13,780
Total 81,809 77,982 64,990

-R&D expenses for the fiscal year ending March 2018 are forecast to be JPY 90,000 million.
-The Company’s R&D headquarters is developing new technology and products especially for the automotive, health-care, and Medicare markets, under the idea of forging new business operations.

Capital Expenditure

(in millions of JPY)
FY ended Mar. 31, 2017 FY ended Mar. 31, 2016 FY ended Mar. 31, 2015
Expansion and rationalization of production facilities 88,869 122,845 67,704
Expansion of R&D facilities 12,888 12,419 7,380
Acquisition of land and buildings 35,096 14,681 10,921
Total 158,579 172,540 101,184

-Capital investments for the fiscal year ending March 2018 are forecast to be JPY 170,000 million.

-The Company announced that its subsidiary, Izumo Murata Manufacturing Co., Ltd. (Izumo Murata) completed the second production building and would hold a completion ceremony on November 1, 2016. Izumo Murata had built two new production buildings since April 2015. This construction aims at the increase of production capacity to respond to the increasing demand of electronic components for auto industry etc. Auto industry has advanced electrification. Izumo Murata plans to construct the system to respond to the further expanding demand. (From a press release on October 26, 2016)

Planned Capital Investments

(As of Mar. 31, 2017)
Location Targets of investments Planned amount of investment
(million yen)
From To
Toyama Murata Manufacturing Co., Ltd. Hakusan,
Ishikawa Pref.
Facilities for manufacturing components and modules 27,000 Apr. 2017 Mar. 2018
Fukui Murata Manufacturing Co., Ltd. Izumo,
Shimane Pref.
Facilities for manufacturing components 21,000 Apr. 2017 Mar. 2018
Izumo Murata Manufacturing Co., Ltd. Echizen,
Fukui Pref.
Facilities for manufacturing components 20,000 Apr. 2017 Mar. 2018
Wuxi Murata Electronics Co., Ltd. Wuxi, Jiangsu Province,
Facilities for manufacturing components 15,000 Apr. 2017 Mar. 2018
Murata Manufacturing Co., Ltd., Yokaiichi Plant Higashiomi, Shiga Prefecture Facilities for manufacturing raw materials, semi-products, and components 13,000 Apr. 2017 Mar. 2018