Sony Group Corporation (SONY) On Q1 2022 Results - Earnings Call Transcript

Sony Group Corporation (NYSE:SONY) Q1 2022 Earnings Conference Call July 29, 2022 3:00 AM ET

Company Participants

Hiroki Totoki - Executive Deputy President and Chief Financial Officer

Naomi Matsuoka - SVP in charge of Corporate Planning and Control, Support for Finance Business and Entertainment Area

Sadahiko Hayakawa - SVP in charge of Finance and IR

Conference Call Participants

Yuri Furukawa - Bloomberg

Masahiro Ono - Morgan Stanley

Junya Ayada - JP Morgan

Yasuo Nakane - Mizuho Securities

Ryosuke Katsura - SMBC Nikko Shoken

Operator

Now it's time to start Sony Group Incorporated consolidated announcement. My name is Okada from PR, and I'll be facilitator for this meeting. I'd like to first ask Mr. Totoki, Executive Deputy President and Chief Financial Officer, Senior Vice President, who will be giving the presentation about our projections for the rest of the year, and the result of first quarter of 2022. We are planning to finish this in about [indiscernible].

And with that, Totoki-san, we will.

Hiroki Totoki

Thank you very much. I would, now, today, I'll start with discussing business environment around our company. The forecast announced in May was based on growth outlook of the global economy as of January, as well as major risks at the time of forecasting, such as direct impact from the situation in Ukraine and the impact of COVID-19 in China.

Business in Iran had changed significantly since then and there were concerns about more slowdown of global economy, primarily due to rapid inflation as well as responding monetary policy by different countries. We are working to assess the impact from those environmental changes. I will take prompt actions to address them as a top priority in managing our business. And the forecast we disclose today incorporates those impact to reasonable degree based on current circumstances.

ET&S and I&SS are highly sensitive to changes in macro environment. But we are also paying close attention to all other segments including G&NS, Music, Picture and Financial Services, and we are taking steps to mitigate risks in managing our business.

Now I will explain the following topics. FY22 Q1 consolidated sales increased 2% year-on year to ¥2,311.5 billion, and consolidated operating income increased ¥26.9 billion to ¥307 billion, both of which were record high for the first quarter. Income before tax increased ¥8.2 billion year-one-year to ¥291.4 billion and net income attributable to Sony Corporation -- Sony Group Corporation shareholders increased ¥6.4 billion to ¥218.2 billion. Consolidated operating cash flow excluding the financial services are an outflow of ¥167.4 billion primarily driven by increasing working capital and impact from currency adjustment due to a weaker Japanese yen. The slide show result by segment of FY22 Q1.