Slide 1: FYE 2019 Business Results
FYE 2019 Business Results SUBARU CORPORATION Tomomi Nakamura Representative Director, President and CEO May 10, 2019 https://www.subaru.co.jp/ir/ 1
Slide 2: FYE 2019 Consolidated Financial Results
FYE 2019 Consolidated Financial Results Yen in 100 Millions, Units in Thousands Results Previous forecasts Results FYE 2018 FYE 2019 FYE 2019 Change Change （Feb 7, 2019) (c)-(a) (c)-(b) (a) (b) (c) Consolidated unit sales 1,066.9 996.4 999.9 -67.0 +3.5 *1 *2 Net sales 32,327 31,200 31,605 -722 +405
Slide 3: Subaru's U.S. Retail Sales and Market Share Growth
FYE 2019 Review Subaru’s U.S. Retail Sales and Market Share Growth - Sales: fiscal year basis / Market share: calendar year basis - U.S. overall sales data source: Motor Intelligence report “U.S. Market New Vehicle Deliveries” (2012-2018) All-new Ascent launched 684,562 Market share (CY) 2012 2013 2
Slide 4: Mid-Term Management Vision: STEP
FYE 2019 Review Mid-Term Management Vision: STEP (Announced on July 10, 2018) https://www.subaru.co.jp/ir/ 4
Slide 5: Corporate Culture Change
Corporate Culture Change < Goal for the fiscal year ended March 2019 > Culture changes happening throughout the organization, with a goal of developing a new corporate environment of more open and candid communication. The senior management to take leadership in promoting change: Concrete actions ha
Slide 6: Corporate Culture Change – Efforts at Gunma Manufacturing Division
Corporate Culture Change – Efforts at Gunma Manufacturing Division Senior management staying close to the “genba” (actual worksite) - Optimizing the span of management (Increase the number of Group Chiefs, etc.) - Securing communication time Executing “Stop-Call-Wait” https://www.subaru.co.jp/ir/ 6
Slide 7: Quality Enhancement
Quality Enhancement Efforts to prevent recurrence Re-education carried out for employees including inspectors. Inspectors conduct review of their work daily. (ongoing since October 2018) Reinforcement and improvement in inspection-related facilities and human resources. Organizational change (
Slide 8: Quality Enhancement
Quality Enhancement Going forward, Subaru will advance tangible/intangible measures to produce results: Subaru Quality Policy updated (April 1, 2019) Facilities/Equipment investment 1. Production/Inspection lines 2. R&D facilities and equipment Improve workplace environment -- For increase in emp
Slide 9: Corporate Governance Reinforcement
Corporate Governance Reinforcement Increase in Outside Corporate Auditors: With the aim of enhancing the supervisory functions of the Board of Directors, an increase in Outside Corporate Directors from two to three will be proposed at the Company’s 88th General Meeting of Shareholders scheduled for
Slide 10: FYE 2020 Prospects
FYE 2020 Prospects The all-new Outback* debut at the New York Auto Show (April 17, 2019) * U.S. specification model Scheduled to go on sale in fall of 2019 in the U.S. and Canada. (Produced at Subaru of Indiana Automotive, Inc.) Together with the Ascent 3-row SUV, the all-new Outback – the fully-red
Slide 11: FYE 2020 Consolidated Financial Forecasts
FYE 2020 Consolidated Financial Forecasts Yen in 100 Millions, Units in Thousands *1 *2 *3 *1: “Net sales” in JGAAP is stated as “revenue” in IFRS. *2: “Operating income” in JGAAP is stated as “operating profit” in IFRS. *3: "Net income attributable to owners of parent “ in JGAAP is stated as "profi
Slide 12: Shareholder Returns
Shareholder Returns < Dividend per share> FYE 2018 FYE 2019 FYE 2020 Result Plan Forecast Interim dividend 72 yen 72 yen 72 yen Year-end dividend 72 yen 72 yen 72 yen Total 144 yen 144 yen 144 yen Payout ratio 50.1% 74.7% 52.6% https://www.subaru.co.jp/ir/ 12
Slide 13: Forward-looking statements disclaimer
Forward-looking statements including projections and future strategies mentioned in this presentation are based on currently available information and assumptions and are subject to risks and uncertainties. Actual results may vary materially as a result of various factors including, without limitati
Slide 14: Consolidated Financial Results for FYE 2019
Consolidated Financial Results for FYE 2019 SUBARU CORPORATION Toshiaki Okada Corporate Executive Vice President & CFO May 10th, 2019 https://www.subaru.co.jp/en/ir/ 1
Slide 15: Consolidated Financial Results for FYE 2019
Consolidated Financial Results for FYE 2019 https://www.subaru.co.jp/en/ir/ 2
Slide 16: Consolidated Unit Sales (by market)
FYE 2019 : Consolidated Unit Sales (by market) （Thousand Units） Results Results Variance FYE 2018 FYE 2019 Passenger cars 132.6 109.7 -22.9 Minicars 30.9 25.6 -5.3 Domestic total 163.4 135.3 -28.1 US 670.9 659.7 -11.2 Canada 56.8 56.8 +0.0 Russia 7.7 8.1 +0.4 Europe 40.2 32.1 -8.1 Australia 55.7 41.
Slide 17: Consolidated Unit Sales / Complete Cars Production
FYE 2019 : Consolidated Unit Sales / Complete Cars Production （Thousand Units） Results Results Variance FYE 2018 FYE 2019 Consolidated Unit 1,066.9 999.9 -67.0 Sales Total （Thousand Units） Results Results Variance FYE 2018 FYE 2019 Production in U.S. 348.6 372.2 +23.6 Production in Japan 701.2 617.0
Slide 18: Consolidated Income Statements
FYE 2019 : Consolidated Income Statements (100 Million Yen) Previous Plan Results Results FYE 2019 Variance Variance FYE 2018 FYE 2019 (as of Feb. 7th) (c)-(a) (c)-(b) (a) (c) (b) Net sales (34,052) 32,327 31,200 31,605 -722 +405 Domestic (6,686) 6,680 5,698 5,966 -714 +268 Overseas (27,367) 25,647
Slide 19: Analysis of Variance in Operating Income (Consolidated)
FYE 2019 : Analysis of Variance in Operating Income (Consolidated) R&D expenses (100 Million Yen) +186 SG&A expenses and others Sales volume Cost Loss on -987 & mixture reduction currency and others -107 exchange -874 -57 Results Results Operating Income Operating Income FYE 2018 -1,839 FYE 2019 Sal
Slide 20: Analysis of Variance in Operating Income vs. Previous Plan
Previous Plan FYE 2019 (as of February 7th) vs. Actual Results : Analysis of Variance in Operating Income (Consolidated) Gain on (100 Million Yen) Sales volume R&D currency & mixture expenses exchange and others +34 +16 +109 SG&A Cost expenses reduction and others -16 -39 Previous Plan Results Opera
Slide 21: Operating Results of Subsidiaries in U.S.
FYE 2019 : Operating Results of Subsidiaries in U.S. （Million US$） Results Results SOA FYE 2018 FYE 2019 Variance Net sales 18,402 19,114 +712 Operating income 356 349 -7 Net income 235 297 +62 Retail sales 651.9 684.3 +32.4 (Thousand units) Results Results SIA FYE 2018 FYE 2019 Variance Net sales 7
Slide 22: Capex / Depreciation / R&D / Interest Bearing Debt
Capex / Depreciation / R&D / Interest Bearing Debt (100 Million Yen) Previous Plan Results Results FYE 2019 Variance Variance FYE 2018 FYE 2019 (as of Feb. 7th ) (c)-(a) (c)-(b) (a) (c) (b) Capex 1,414 1,300 1,135 -279 -165 Depreciation 898 930 888 -10 -42 R&D 1,211 1,060 1,027 -184 -33 Interest bea
Slide 23: Forecasts for FYE 2020 (IFRS)
Forecasts for FYE 2020 (IFRS) SUBARU Corporation will voluntarily adopt the International Financial Reporting Standards (IFRS) from the first quarter of the fiscal year ending March 2020. Therefore, the consolidated forecast for the fiscal year ending March 2020 is prepared based on IFRS. Please ref
Slide 24: Key differences of JGAAP and IFRS
Key differences of JGAAP and IFRS Japanese generally accepted accounting principles International Financial Reporting Standards Item (JGAAP) (IFRS) In case that it is satisfied with criterion of assets, Recorded as expenses when it incurred. it will be amortized. R&D expenses R&D expenses which is r
Slide 25: FYE2020 Plan: Consolidated Unit Sales (by market)
FYE2020 Plan: Consolidated Unit Sales (by market) （Thousand Units） Reference Results Plan Plan Variance FYE 2019 (a) FYE 2020 FYE 2020 (b) JGAAP IFRS JGAAP (b)-(a) Passenger cars (*) 109.7 112.3 110.0 +0.3 Minicars (*) 25.6 28.2 27.6 +2.0 Domestic total(*) 135.3 140.5 137.5 +2.2 US 659.7 693.2 693.2
Slide 26: FYE 2020 Plan: Unit Sales / Complete Cars Production
FYE 2020 Plan : Consolidated Unit Sales / Complete Cars Production （Thousand Units） Results Plan FYE 2019 FYE 2020 (JGAAP) (IFRS) Consolidated Unit Sales Total 999.9 1,058.3 （Thousand Units） Results Plan Variance FYE 2019 FYE 2020 Production in U.S. 372.2 388.7 +16.6 Production in Japan 617.0 667.5
Slide 27: FYE 2020 Plan: Consolidated Profit Plan
FYE 2020 Plan : Consolidated Profit Plan Reference Results Plan Plan Variance FYE 2019 (a) FYE 2020 FYE 2020 (b) JGAAP IFRS JGAAP (b)-(a) Revenue (*1) 31,605 33,100 33,020 +1,415 Domestic 5,966 5,841 5,760 -206 Overseas 25,639 27,260 27,260 +1,620 Operating profit (*2) 1,955 2,600 2,500 +545 Profit
Slide 28: Analysis of Variance in Operating Profit (Consolidated)
Plan FYE 2020 : Analysis of Variance in Operating Profit (Consolidated) (100 Million Yen) Sales volume SG&A & mixture expenses and others Accounting standard and others +252 difference +706 +100 R&D Loss on Cost expenses currency reduction -173 exchange -92 -148 Results Plan Plan Operating Income Op
Slide 29: Capex / Depreciation / R&D / Interest Bearing Debt
Capex / Depreciation / R&D / Interest Bearing Debt (100 Million Yen) Results Plan Variance FYE 2019 FYE 2020 Capex (*1) 1,135 1,400 +265 Depreciation (*1) 888 1,000 +112 R&D expenditures (*2) 1,027 1,200 +173 Interest bearing debt (*1) 1,004 1,450 +446 *1 : Leases, capex & amortization for intangibl
Slide 30: Appendix (1)
Appendix (1) • Consolidated Balance Sheets • Consolidated Statements of Cash Flows • Non-operating Income & Expenses and Extraordinary Income & Losses • Segment information by Business & Geographic • Overseas Net Sales • Non-consolidated Unit Sales • 4th Quarter (3 months) Consolidated Unit Sales an
Slide 31: Consolidated Balance Sheets
Consolidated Balance Sheets (100 Million Yen) As of March 2018 As of March 2019 Variance Total assets 28,665 29,827 +1,163 Current assets 17,704 18,262 +558 Noncurrent assets 10,960 11,565 +605 Total liabilities 13,055 13,699 +644 Interest bearing debts 862 1,004 +142 Net assets 15,610 16,128 +518 R
Slide 32: Consolidated Statements of Cash Flows
FYE 2019 : Consolidated Statements of Cash Flows (100 Million Yen) Results Results Variance FYE 2018 FYE 2019 Net cash provided by (used in) operating activities 3,663 1,740 -1,923 Net cash provided by (used in) investing activities -1,507 -1,583 -76 Free cash flows 2,156 157 -1,999 Net cash provide
Slide 33: Non-operating Income & Expenses and Extraordinary Income & Losses
FYE 2019 : Non-operating Income & Expenses and Extraordinary Income & Losses (Consolidated) （100 Million Yen） Results Results Variance FYE 2018 FYE 2019 Financial revenue and expenditure 68 129 +61 FOREX effects -51 -72 -2１ Others -12 -50 -38 Total non-operating income & expenses 5 7 +2 Gain on sale
Slide 34: Net Sales and Operating Income by Business Segment
FYE 2019 : Net Sales and Operating Income by Business Segment (Consolidated) (100 Million Yen) Net Sales Operating Income Results Results Results Results Variance Variance FYE 2018 FYE 2019 FYE 2018 FYE 2019 Automobile (32,349) 30,623 30,145 -479 3,615 1,849 -1,765 Aerospace (1,422) 1,422 1,317 -105
Slide 35: Net Sales and Operating Income by Geographic Area
FYE 2019 : Net Sales and Operating Income by Geographic Area (Consolidated) (100 Million Yen) Net Sales Operating Income Results Results Results Results Variance Variance FYE 2018 FYE 2019 FYE 2018 FYE 2019 Japan (10,118) 10,110 8,990 -1,121 2,950 1,147 -1,803 North America (21,928) 20,276 21,037 +7
Slide 36: Overseas Net Sales (Consolidated)
FYE 2019 : Overseas Net Sales (Consolidated) (100 Million Yen) Results Results Variance FYE 2018 FYE 2019 North America (23,058) 21,406 22,017 +611 Europe (1,191) 1,181 1,005 -176 Asia (1,406) 1,351 1,164 -187 Others (1,712) 1,709 1,453 -256 Total (27,367) 25,647 25,639 -8 * Changed accounting polic
Slide 37: Non-consolidated Unit Sales
FYE 2019 : Non-consolidated Unit Sales (Thousand Units) Results Results FYE 2018 FYE 2019 Variance Domestic production 701.2 617.0 -84.2 Domestic sales 168.9 140.7 -28.2 Passenger cars 137.2 114.4 -22.8 Minicars 31.7 26.3 -5.4 Number of exported vehicles 556.5 491.5 -65.0 Components for overseas pro
Slide 38: 4th Quarter Consolidated Unit Sales
4th Quarter (3 months) : Consolidated Unit Sales (Thousand Units) Results Results 4th Quarter (3 months) 4th Quarter (3 months) Variance FYE 2018 FYE 2019 Passenger cars 34.9 29.8 -5.1 Minicars 9.7 7.0 -2.7 Domestic total 44.6 36.8 -7.8 US 161.9 163.8 +1.9 Canada 12.3 9.6 -2.8 Russia 2.1 1.6 -0.5 Eu
Slide 39: 4th Quarter Consolidated Income Statements
4th Quarter (3 months) : Consolidated Income Statements (100 Million Yen) Results Results 4th Quarter (3 months) 4th Quarter (3 months) Variance FYE 2018 FYE 2019 Net sales (8,406) 7,949 7,831 -118 Domestic (1,840) 1,838 1,608 -230 Overseas (6,565) 6,111 6,223 +111 Operating income 731 419 -313 Ordi
Slide 40: 4th Quarter Analysis of Variance in Operating Income
4th Quarter (3 months) : Analysis of Variance in Operating Income(Consolidated) Gain on currency (100 Million Yen) R&D expenses exchange +74 +58 Sales volume & mixture and others SG&A -210 expenses Cost and others reduction -174 -61 Results Results Operating Income Operating Income 4Q (3 months) -31
Slide 41: Complete Cars Production / Retail Sales Units
Complete Cars Production / Retail Sales Units (1,000units） Production Retail Sales 300 280 276 276 278 273269 264 261 268270 264 271 269 258 257 253 249 253 249 252 250 244 248 245242 250 242 241 242 237 237 229233 231 227 200 150 100 50 0 Jan- Apr- Jul-Sep Oct- Jan- Apr- Jul-Sep Oct- Jan- Apr- Jul-
Slide 42: Appendix (2): Changes Due to Voluntary Adoption of IFRS
Appendix (2) Changes in Consolidated Financial Statements Due to Voluntary Adoption of International Financial Reporting Standards (IFRS) Information included in this material is currently under consideration. Therefore, please be advised that our actual consolidated financial statements based on IF
Slide 43: Consolidated Statements of Income
Consolidated Statements of Income JGAAP IFRS Net sales Revenue 1) "Selling, general and administrative expenses" on Cost of sales Cost of sales "Japanese Generally Accepted Accounting Principles" Gross profit Gross profit (hereafter "JGAAP") will be presented as "Selling, general and administrative
Slide 44: Consolidated statement of financial position (Assets)
Consolidated statement of financial position（Assets） JGAAP IFRS Consolidated statement of Consolidated Balance Sheet (Assets) financial position (Assets) 1) Of "Cash and deposits" and "Short-term Assets Assets investment securities" on JGAAP, Cash and Current assets Current assets securities that ma
Slide 45: Consolidated statement of financial position (Liabilities and Equity)
Consolidated statement of financial position（Liabilities and Equity） JGAAP IFRS Consolidated Balance Sheet Consolidated statement of (Liabilities and Equity) financial position（Liabilities and Equity） 1) "Notes and accounts payable- trade","Electronically recorded Liabilities Liabilities and equity
Slide 46: Consolidated Statements of Cash Flows
Consolidated Statements of Cash Flows JGAAP IFRS Net cash provided by (used in) operating activities Net cash provided by (used in) operating activities Income (loss) before income taxes Profit before tax 1) Operating lease transactions that were recorded as expense on Depreciation and amortization
Slide 47: https://www.subaru.co.jp/en/ir/
Forward-looking statements including projections and future strategies mentioned in this presentation are based on currently available information and assumptions and are subject to risks and uncertainties. Actual results may vary materially as a result of various factors including, without limitati