Tdk Corporation · TSE:6762
Tdk — Q1 2024 Earnings Presentation
36 slides from Tdk's earnings presentation, Aug 2, 2023
Slide 1: 1st Quarter Performance Briefing
Fiscal Year March 2024 1st Quarter Performance Briefing TDK Corporation IR&SR Group August 2, 2023
Slide 2: Index
Index 1 1st Quarter Fiscal 2024 Results Highlights Tetsuji Yamanishi, Executive Vice President 2 Fiscal 2024 Projections Noboru Saito, President & CEO 3 Appendix © TDK Corporation 2023 Q1, Fiscal 2024 Performance Briefing IR&SR Group, August 2, 2023 2
Slide 3: 1st Quarter Fiscal 2024 Results Highlights
1st Quarter Fiscal 2024 Results Highlights Tetsuji Yamanishi Executive Vice President © TDK Corporation 2023 Q1, Fiscal 2024 Performance Briefing IR&SR Group, August 2, 2023 3
Slide 4: Q1, fiscal 2024 key points
Q1, fiscal 2024 key points • Both net sales and operating profit decreased year on year due to changes in demand from the HDD market and the automotive market in addition to the continuing slowdown in the ICT market. Net sales (JPY bn) Operating profit (JPY bn) 503.4 26.3 Down 1.4 ％ YoY Down 41.0 ％
Slide 5: Q1, fiscal 2024 results
Q1, fiscal 2024 results • Net sales and Operating profit decreased year on year. FY2023 FY2024 Change ▍Ex-rate impact to net sales, operating profit (OP) (JPY bn) (JPY bn) Q1 Q1 JPY bn % Net sales Approx. +18.1 Net sales 510.5 503.4 (7.1) (1.4)% OP Approx. +6.5 Operating profit 44.6 26.3 (18.3) (41.
Slide 6: Passive Components segment
Passive Components segment • Profit decreased year on year due to a decline in sales to the ICT market despite an increase in sales to the automotive market including xEV applications. ▍Net sales (JPY bn) (1.1)% 200 Ceramic • Sales increased while profit decreased year on year. 142.4 153.5 145.3 140
Slide 7: Sensor Application Products segment
Sensor Application Products segment • Profit decreased year on year due to a decline in sales to the ICT market despite an increase in sales to the automotive market. ▍Net sales (JPY bn) (0.6)% 60 50 45.9 45.6 Temperature and • Sales and profit increased year on year. 39.0 39.0 38.8 pressure sensors
Slide 8: Magnetic Application Products segment
Magnetic Application Products segment • Sales and profit decreased year on year as sales to the HDD market remained significantly below the previous year’s level. ▍Net sales (JPY bn) (30.7)% HDD heads 70 and HDD 55.1 54.7 • Sales and profit decreased significantly year on year. 60 suspension 50 47.5
Slide 9: Energy Application Products segment
Energy Application Products segment • Sales increased year on year as sales of rechargeable batteries for smartphone applications remained above the previous year’s level. • Sales and profit increased year on year reflecting robust sales of power supplies to the industrial equipment market and for x
Slide 10: Quarterly results by segment
Quarterly results by segment FY2023 FY2023 FY2024 YoY (C)-(A) QoQ (C)-(B) (JPY bn) Q1(A) Q4(B) Q1(C) JPY bn % JPY bn % Capacitors 58.3 58.3 62.5 +4.2 +7.2% +4.2 +7.2% Inductive Devices 49.3 46.3 46.7 (2.6) (5.2)% +0.5 +1.0% Other Passive Components 34.7 33.0 31.5 (3.2) (9.3)% (1.5) (4.5)% Passive Co
Slide 11: Analysis of change in operating profit
Analysis of change in operating profit (JPY bn) Operating profit (18.3) Ex-rate fluctuation USD/JPY: 129.36 → 137.18 SG&A expenses Changes in sales Benefits from decrease (incl. deterioration in Rationalization, restructuring Q1, FY2023 operating rate and cost reduction Q1, FY2024 44.6 changes in pr
Slide 12: Projections by segment for Q2, fiscal 2024
Projections by segment for Q2, fiscal 2024 FY2024 Factor (JPY bn)) Q1 Q2 Projection (QoQ) Passive Components 140.7 0 ~ +3% • Sales of ceramic capacitors for automobile applications are expected to increase. Sensor Application • Sales of magnetic sensors and MEMS microphones for ICT applications are
Slide 13: Fiscal 2024 Projections
Fiscal 2024 Projections Noboru Saito President & CEO © TDK Corporation 2023 Q1, Fiscal 2024 Performance Briefing IR&SR Group, August 2, 2023 13
Slide 14: Assumptions for performance forecast - key market predictions
Assumptions for performance forecast - key market predictions • While the forecast for the automotive market remains unchanged, the ICT market, especially the HDD market, is expected to deteriorate rapidly. FY2023 FY2024 (Forecast as of April 2023) FY2024 (Forecast as of August 2023) Actual (A) Valu
Slide 15: Fiscal 2024 projections
Fiscal 2024 projections • Fiscal 2024 projections have been revised downward reflecting rapid changes in the operating environment from the initial forecast. FY2023 FY2024 Projection Change (YoY) Actual As of April 2023 As of August 2023 JPY bn % (JPY bn) Net sales 2,180.8 2,020.0 1,970.0 (210.8) (9
Slide 16: Projections by segment for fiscal 2024
Projections by segment for fiscal 2024 FY2023 FY2024 Projection (YoY) Factor Actual As of 4/28 As of 8/2 (JPY bn) • Sales of ceramic capacitors for automobile applications are Passive Components 578.8 +9 ~ +12% +2 ~ +5% expected to increase. • Sales of magnetic sensors for ICT applications are expec
Slide 17: Analysis of change in operating profit in fiscal 2024 projection
Analysis of change in operating profit in fiscal 2024 projection (JPY bn) Operating profit (40.0) Ex-rate fluctuation SG&A expenses USD/JPY: Changes in sales Rationalization, decrease 130.00 → 132.00 Benefits from FY2024 (incl. deterioration in Selling price One-time cost reduction FY2024 restructur
Slide 18: Measures to respond to rapid changes in the HDD-related market
Measures to respond to rapid changes in the HDD-related market • Implement various measures swiftly in line with rapid market changes. Environmental changes ▍Sales forecasts for products for the HDD market (An index based on the forecast volume in April 2023, set at 100) • Changes in Capex allocatio
Slide 19: Projections for Capex, Depreciation, and R&D
Projections for Capex, Depreciation, and R&D • Capex and various expenses have been reviewed. Capex Depreciation R&D (JPY bn) 350 FY2024 FY2024 FY2024 Projections Projections Projections 300 291.3 275.7 260.0 250 240.0 212.2 206.3 200 185.0 180.0 179.5 180.0 173.6 173.4 177.0 170.0 165.3 148.4 150 1
Slide 20: Cash flow projections
Cash flow projections FY2024 (JPY bn) Operating cash flow Investment cash flow Free cash flow Projections 360.0 340.0 262.8 222.4 230.9 179.0 140.3 180.4 80.0 80.0 28.4 0.1 (0.6) Incl. advance (42.0) payments of about 110.0 bn JPY to secure (102.6) stable supply of battery (140.2) materials. (231.4)
Slide 21: Appendix
Appendix © TDK Corporation 2023 Q1, Fiscal 2024 Performance Briefing IR&SR Group, August 2, 2023 21
Slide 22: Quarterly sales and operating profit by segment
Quarterly sales and operating profit by segment FY2023 FY2024 (JPY bn) Q1 Q2 Q3 Q4 Total Q1 Q2 Q3 Q4 Total Capacitors 58.3 63.7 62.1 58.3 242.5 62.5 Inductive Devices 49.3 52.8 50.1 46.3 198.5 46.7 Other Passive Components 34.7 37.0 33.1 33.0 137.8 31.5 142.4 153.5 145.3 137.6 578.8 140.7 Net Sales
Slide 23: Financial position
Financial position March 31, 2023 June 30, 2023 Change (JPY bn) Total assets 3,147.0 3,302.2 +155.2 Total liabilities 1,684.2 1,749.1 (65.0) Total equity attributable to owners of parent 1,458.4 1,547.4 +88.9 Ratio of equity attributable to owners of parent 46.3% 46.9% +0.6pts Cash and cash equivale
Slide 24: Capex, Depreciation, R&D - Q1
Capex, Depreciation, R&D - Q1 FY2023 FY2024 Change (JPY bn) Q1 Q1 Capex 69.7 60.7 (9.0) Depreciation 51.1 47.4 (3.6) % to net sales 10.0% 9.4% (0.6)pts R&D 44.5 43.9 (0.6) % to net sales 8.7% 8.7% 0.0pts ▍Capex ▍Depreciation, % to net sales ▍R&D, % to net sales （JPY bn） （%） 80 69.7 80 20 80 20 60.7
Slide 25: Cash flows - Q1
Cash flows - Q1 FY2023 FY2024 Change (JPY bn) Q1 Q1 Operating cash flow (8.1) 57.4 +65.5 Investing cash flow (29.2) (49.5) (20.3) Free cash flow (37.3) 7.9 +45.2 Financing cash flow (10.4) 16.0 +26.3 Effects of ex-rate fluctuation 36.0 26.2 (9.8) Cash and cash equivalents 427.6 556.2 +128.5 ▍Operati
Slide 26: Annual sales by market (FY2019 – FY2023)
Annual sales by market (FY2019 – FY2023) All (JPY bn) ▍Automotive ▍ICT 2,500 2,180.8 (JPY bn) (JPY bn) 2,000 1,902.1 418.7 1,207.6 400 1,200 1,142.5 330.4 1,381.8 1,479.0 1,500 1,363.0 253.7 245.3 248.6 1,000 821.6 913.7 300 809.8 800 1,000 200 600 400 500 100 200 0 0 0 FY19 FY20 FY21 FY22 FY23 FY19
Slide 27: Quarterly sales by market (FY2023 – FY2024)
Quarterly sales by market (FY2023 – FY2024) All (JPY bn) ▍Automotive ▍ICT 611.5 587.0 600 (JPY bn) (JPY bn) 510.5 503.4 500 471.9 120 111.1 109.2 111.8 400 357.4 102.8 334.5 95.6 350 100 400 300 280.4 262.5 80 235.2 250 300 60 200 200 150 40 100 100 20 50 0 0 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
Slide 28: Annual sales by market - Passive Components
Annual sales by market (FY2019 – FY2023) Passive Components ▍Automotive ▍ICT (JPY bn) 600 575.9 507.8 500 (JPY bn) (JPY bn) 433.4 395.5 407.1 255.5 150 400 250 211.8 300 200 168.8 168.7 172.1 100 76.3 75.7 78.8 81.5 150 72.3 200 100 50 100 50 0 0 0 FY19 FY20 FY21 FY22 FY23 FY19 FY20 FY21 FY22 FY23 F
Slide 29: Quarterly sales by market - Passive Components
Quarterly sales by market (FY2023 – FY2024) Passive Components ▍Automotive ▍ICT (JPY bn) 153.5 142.4 145.3 150 137.6 140.7 (JPY bn) (JPY bn) 66.1 65.7 63.5 66.7 60.8 60 30 100 21.0 19.6 40 20 18.1 13.7 14.6 50 20 10 0 0 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY2023
Slide 30: Annual sales by market - Sensor Application Products
Annual sales by market (FY2019 – FY2023) Sensor Application Products (JPY bn) ▍Automotive ▍ICT 169.5 150 (JPY bn) (JPY bn) 130.8 80 72.5 80 61.2 56.1 100 60 76.5 77.9 81.3 60 46.2 39.2 36.4 40 34.4 40 25.8 50 17.4 20.6 20 20 0 0 0 FY19 FY20 FY21 FY22 FY23 FY19 FY20 FY21 FY22 FY23 FY19 FY20 FY21 FY22
Slide 31: Quarterly sales by market - Sensor Application Products
Quarterly sales by market (FY2023 – FY2024) Sensor Application Products (JPY bn) ▍Automotive ▍ICT 50 45.9 45.6 (JPY bn) (JPY bn) 39.0 39.0 38.8 20 19.0 30 40 16.3 15.2 16.0 25 21.7 20.9 30 15 13.7 20 15.1 14.9 20 10 15 12.4 10 10 5 5 0 0 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Slide 32: Financial information: 10-year historical trend
Financial information: 10-year historical trend ▍Net sales, Overseas sales ratio ▍Operating profit, Net profit, OP margin (JPY mn) Net sales Overseas sales ratio (JPY mn) Operating profit Net profit (loss) OP margin 91.9% 208,660 2,500,000 90.5% 91.4% 92.1% 91.1% 91.1% 91.8% 91.9% 92.1% 92.2% 2,180,
Slide 33: Financial information: 10-year historical trend
Financial information: 10-year historical trend ▍Total assets, Total equity attributable to owners of parent, Ratio of equity attributable to owners of parent ▍ROI, ROE, ROA Total assets Total equity attributable to owners of parent (JPY mn) Ratio of equity attributable to owners of parent ROI ROE R
Slide 34: Status of inclusion in the ESG Index / Recognition by investors and rating agencies
Status of inclusion in the ESG Index / Recognition by investors and rating agencies ▍Index Funds ▍Ratings FTSE4Good Index Series Sompo Sustainability Index An index compiled based on the results of the Buna-no- An index provided by FTSE Russell that was Mori Environmental Questionnaire and ESG Manag
Slide 35: Cautionary statements with respect to forward-looking statements
Cautionary statements with respect to forward-looking statements This material contains forward-looking statements, including projections, plans, policies, management strategies, targets, schedules, understandings, and evaluations about TDK, or its group companies (TDK Group). These forward-looking
Slide 36: Text data including Q&A of performance briefing will be uploaded
Text data including Q&A of performance briefing will be uploaded on following site. https://www.tdk.com/en/ir/ir_events/conference/2024/1q_1.html