Dentsu Reports Consolidated Financial Results for the Nine Months Ended December 31, 2012 (Japanese GAAP)<4324.T>

Fri Feb 8, 2013 1:30am EST

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-Posts 1,412.1 Billion Yen in Consolidated Billings (Net Sales) (4.0%
year-on-year increase), 38.1 Billion Yen in Operating Income (24.1% increase),
39.0 Billion Yen in Ordinary Income(4.8% increase) and 19.9 Billion Yen in Net
Income (50.2% increase) -
TOKYO--(Business Wire)--
Dentsu Inc. (TOKYO:4324)(ISIN:JP3551520004)(President & CEO: Tadashi Ishii; Head
Office: Tokyo; Capital: 58,967.1 million yen) today convened a meeting of its
Board of Directors at its Head Office in Tokyo at which it finalized its
consolidated and non-consolidated financial results for the nine months ended
December 31, 2012 (April 1-December 31, 2012). 

Summary of financial results for the period
During the nine months ended December 31, 2012, the Japanese economy showed a
gradual recovery due to demand from reconstruction in the wake of the Great East
Japan Earthquake and the effects of policies such as Japan's eco-car subsidy
program. However, the situation remained uncertain due to concerns about the
prolonged European government debt crisis as well as the slowdown in economic
growth seen in China and other emerging economies. 

Meanwhile, demand for advertising, mainly television spots, showed a strong
upturn in the April-June quarter as the market rebounded from the effects of the
devastating earthquake and tsunami which had affected the advertising industry
during the same period a year earlier. However, against the background of
increasing uncertainty about the future of the global economy, advertising
demand started to slow in the summer. 

Under such circumstances, the Dentsu Group (hereinafter "the Group") leveraged
its comprehensive resources and proactively pursued a diverse array of business
opportunities by offering "Integrated Communication Design" solutions.
Furthermore, events such as the London 2012 Olympic Games and TOYOTA Presents
FIFA Club World Cup Japan 2012 provided the Group with opportunities for
multi-faceted business development. 

As a result, for the nine months ended December 31, 2012, the Group posted
consolidated billings (net sales) of 1,412,195 million yen, an increase of 4.0%
compared with the same period of the previous fiscal year; gross profit of
248,963 million yen, an increase of 6.0%; operating income of 38,116 million
yen, an increase of 24.1%; and ordinary income of 39,098 million yen, an
increase of 4.8%. Net income for the nine months ended December 31, 2012 was
19,939 million yen, an increase of 50.2%. 

Looking at the results by business segment, net sales of 1,368,930 million yen,
an increase of 4.0% compared with the same period of the previous fiscal year,
and segment income of 35,106 million yen, an increase of 24.0%, were posted in
the Advertising segment. In the Information Services segment, net sales of
48,113 million yen, an increase of 9.7%, and segment income of 742 million yen
were posted (a segment loss of 461 million yen was posted for the same period of
the previous fiscal year). Net sales in the Other Business segment totaled
12,365 million yen, a decrease of 9.9%, with segment income of 823 million yen,
an increase of 87.3%. 

By geographic area, net sales of 1,217,696 million yen, an increase of 1.8%
compared with the same period of the previous fiscal year, and operating income
of 34,781 million yen, an increase of 21.7%, were posted in Japan. In other
countries, net sales of 200,980 million yen, an increase of 19.8%, and operating
income of 3,120 million yen, an increase of 68.8%, were posted. 

Regarding Dentsu Group companies with a December 31 closing date, including
subsidiaries in countries other than Japan, their financial results for the nine
months from January 1 to September 30, 2012 are, as a general rule, incorporated
in the consolidated financial results for the nine months ended December 31,
2012. 

Dentsu posted non-consolidated billings (net sales) of 1,037,789 million yen, an
increase of 0.9% compared with the same period of the previous fiscal year;
gross profit of 142,699 million yen, an increase of 2.0%; operating income of
24,705 million yen, an increase of 23.3%; ordinary income of 28,565 million yen,
an increase of 1.8%; and net income of 15,869 million yen, an increase of 31.0%.


For more details regarding the consolidated and non-consolidated results, please
see the presentation slides in the Presentation Materials section of the company
website at:
http://www.dentsu.com/ir/

Reference: Scope of Consolidated Financial Results
As of December 31, 2012, the Dentsu Group includes 150 consolidated subsidiary
companies and 38 affiliated companies accounted for by the equity method. 88 of
these companies are located in Japan and 100 in countries other than Japan. By
business segment, 170 of these companies fall into the Advertising segment, 13
into the Information Services segment, and 5 into the Other Businesses segment. 

Outlook for the fiscal year ending March 31, 2013
Although results for the nine months ended December 31, 2012 were slightly below
expectations, advertising demand has been on an upward trend since the start of
the 2013 calendar year. Consequently, there are no revisions to the forecast of
consolidated financial results for the fiscal year ending March 31, 2013 which
was announced on November 8, 2012. 

On July 12, 2012, Dentsu announced that it had agreed with Aegis Group plc, a
leading global media and digital communications agency headquartered in the
United Kingdom, to proceed with the acquisition of Aegis by scheme of
arrangement under the laws of England and Wales to make it a wholly owned
subsidiary of Dentsu. As of today, February 8, the acquisition of Aegis has not
become effective yet and therefore its performance has not been contemplated in
the Company's consolidated results for the fiscal year ending March 31, 2013. 

Trend of Quarterly Consolidated Financial Results and Forecast for the Fiscal
Year Ending March 31, 2013

 (Unit: million yen)                                                                                                           
 FY2012*                     Three         YoY        Three         YoY        Three         YoY        Nine          YoY      
                             months        change     months        change     months        change     months        change   
                             ended         (%)        ended         (%)        ended         (%)        ended         (%)      
                             June 30,                 Sept. 30,                Dec. 31,                 Dec. 31,               
                             2012                     2012                     2012                     2012                   
                             (Apr-Jun)                (Jul-Sep)                (Oct-Dec)                (Apr-Dec)              
 Net sales                   447,469       11.3       473,566       2.7        491,159       (0.6)      1,412,195     4.0      
 Gross profit                76,481        12.2       86,172        6.1        86,308        1.1        248,963       6.0      
 Selling, general and        66,910        4.7        73,633        3.9        70,302        1.5        210,846       3.3      
 administrative expenses                                                                                                       
 Operating income            9,571         126.4      12,539        21.4       16,005        (1.0)      38,116        24.1     
 Ordinary income             11,497        78.9       8,287         (37.1)     19,488        10.0       39,098        4.8      
 Net income                  5,886         349.8      3,463         (48.3)     10,590        100.9      19,939        50.2     
 * FY2012: April 1, 2012 to March 31, 2013                                                                                     


                                                                                               
 (Unit: million yen)                                                                           
 FY2012*             Six           YoY        Forecast       YoY        FY2012*       YoY      
                     months        change     for the        change     forecast      change   
                     ended         (%)        six months     (%)        announced     (%)      
                     Sept. 30,                ending                    on Nov. 8              
                     2012                     March 31,                 2012                   
                     (Apr-Sep)                2013                                             
                                              (Oct-Mar)                                        
 Net sales           921,036       6.7        1,039,963      1.0        1,961,000     3.6      
 Operating income    22,110        51.9       37,889         1.2        60,000        15.4     
 Ordinary income     19,784        0.9        37,315         (13.7)     57,100        (9.1)    
 Net income          9,349         16.8       18,750         (13.1)     28,100        (5.0)    
 * FY2012: April 1, 2012 to March 31, 2013                                                     
                                                                                               


Dentsu's forecast of non-consolidated financial results for the fiscal year
ending March 31, 2013 that was revised on November 8, 2012 remains unchanged:

* Net sales: 1,440.0 billion yen (2.5% year-on-year increase) 
* Operating income: 39.0 billion yen (23.1% year-on-year increase) 
* Ordinary income: 39.9 billion yen (1.9% year-on-year decrease) 
* Net income: 20.0 billion yen (52.6% year-on-year decrease)

Cautionary statement with respect to forward-looking statements
These business results forecasts have been made by Dentsu on the basis of
currently available information, and hence involve potential risks and
uncertainties. Consequently, actual business results may differ from the
forecasts due to changes in various factors.

                                                                                                                       
                                                                                                                       
 Consolidated Financial Results                                                                                        
 for the Nine Months Ended December 31, 2012                                                                           
 (From April 1 to December 31, 2012)                                                                                   
                                                                                                                       
 1.Summary of Consolidated Balance Sheets                                                                              
                                                                                                                       
                                     (Millions of yen: Rounded down to the nearest one million yen)                    
                                     As of                             As of                                % Change   
                                     March 31,                         December 31,                                    
                                     2012                              2012                                            
 ASSETS                                                                                                                
 Current assets                      722,223                           580,786                              (19.6)     
 Noncurrent assets                   479,671                           586,487                              22.3       
 Total assets                        1,201,894                         1,167,273                            (2.9)      
                                                                                                                       
 LIABILITIES                                                                                                           
 Current liabilities                 525,181                           479,745                              (8.7)      
 Noncurrent liabilities              119,824                           94,767                               (20.9)     
 Total liabilities                   645,005                           574,513                              (10.9)     
                                                                                                                       
 NET ASSETS                                                                                                            
 Shareholders' equity                541,929                           554,031                              2.2        
 Accumulated other                   (5,638)                           17,239                               -          
 comprehensive income                                                                                                  
 Minority interests                  20,598                            21,489                               4.3        
 Total net assets                    556,889                           592,760                              6.4        
 Total liabilities and net assets    1,201,894                         1,167,273                            (2.9)      


                                                                                                                         
 2.Summary of Consolidated Statements of Income                                                                          
                                                                                                                         
                                    (Millions of yen: Rounded down to the nearest one million yen)                       
                                    Nine months                          Nine months                          % Change   
                                    ended                                ended                                           
                                    December 31,                         December 31,                                    
                                    2011                                 2012                                            
 Net sales                          1,357,340                            1,412,195                            4.0        
 Gross profit                       234,774                              248,963                              6.0        
 Operating income                   30,723                               38,116                               24.1       
 Non-operating income               10,091                               7,414                                (26.5)     
 Non-operating expenses             3,505                                6,433                                83.5       
 Ordinary income                    37,309                               39,098                               4.8        
 Extraordinary income               499                                  233                                  (53.2)     
 Extraordinary loss                 5,605                                2,810                                (49.9)     
 Income before income taxes and     32,203                               36,521                               13.4       
 minority interests                                                                                                      
 Net income                         13,274                               19,939                               50.2       


                                                                                                                          
 3.Summary of Consolidated Statements of Comprehensive Income                                                             
                                                                                                                          
                                     (Millions of yen: Rounded down to the nearest one million yen)                       
                                     Nine months                          Nine months                          % Change   
                                     ended                                ended                                           
                                     December 31,                         December 31,                                    
                                     2011                                 2012                                            
 Income before minority interests    14,151                               21,057                               48.8       
 Other comprehensive income          (1,162)                              22,961                               -          
 Comprehensive income                12,989                               44,018                               238.9      
                                                                                                                          


About Dentsu Inc.
Founded in 1901, Dentsu Inc. has held the position of the world's largest
single-brand agency for 40 years. Through its unique "Integrated Communication
Design" approach, Dentsu offers multinational clients the most comprehensive
range of advertising and marketing services in the industry. While continuing to
pursue innovation in the digital arena, Dentsu is active in the production and
marketing of sports, movies, anime and other entertainment content on a global
scale. The Dentsu Group has more than 6,000 clients and around 22,000 employees
worldwide.
Dentsu News: http://www.dentsu.com/news/index.html
Dentsu Inc.: http://www.dentsu.com/index.html

Dentsu Inc.
Shusaku Kannan, (813) 6216-8042
Senior Manager
Corporate Communications Division
s.kannan@dentsu.co.jp



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