Tsuzuki Denki Co., Ltd. · TSE:8157
Tsuzuki Denki — FY2024 Earnings Presentation
26 slides from Tsuzuki Denki's earnings presentation, May 22, 2024
Slide 1: Financial Results for the Fiscal Year Ended March 31, 2024
Financial Results for the Fiscal Year Ended March 31, 2024 / Transformation / Becoming a Pure-play Information Network Solutions Business May 22, 2024 Tsuzuki Denki Co., Ltd. Copyright © 2024 Tsuzuki Denki Co., Ltd.
Slide 2: Table of Contents
01 Financial Results for FY03/24 ー Overview of Consolidated Results ー Consolidated Earnings Forecast ー Shareholder Return Table of Contents 02 Progress of Transformation 2026 ー Executive Summary ー Progress of Measures 1 Copyright © 2024 Tsuzuki Denki Co., Ltd.
Slide 3: 01 Financial Results for FY03/24
01 Financial Results for FY03/24 ー Overview of Consolidated Results ー Consolidated Earnings Forecast ー Shareholder Return 02 Progress of Transformation 2026 ー Executive Summary ー Progress of Measures 2 Copyright © 2024 Tsuzuki Denki Co., Ltd.
Slide 4: Highlights
Highlights Achieved a record profit driven by substantial growth in the Information Network Solutions business, offsetting the drop in performance following the business divestiture • The medium-term management plan strategy for the Information Network Solutions business, including pricing managemen
Slide 5: Factors Affecting Operating Income
Factors Affecting Operating Income ■Positive: Effects of sales increase (+JPY186mn) : Higher sales in all business models of the Information Network Solutions business (impact of sales increase in the Information Network Solutions business: +JPY1,059mn) Offset impact of excluding Q4 earnings for the
Slide 6: Results by Segment
Results by Segment ■Sales Sales increased in all business models of the Information Network Solutions business. Equipment business in particular contributed to sales growth ■Operating income Achieved a record profit in the Information Network Solutions business thanks to thorough pricing management
Slide 7: Results by Business Model (Information Network Solutions)
Results by Business Model (Information Network Solutions) ■Equipment Installed PCs, network equipment, etc. for customers in a wide range of industries Orders and order backlog fell as we received some large orders expected for FY03/24 ahead of schedule in Q4 FY03/23, but the market environment is s
Slide 8: Consolidated Earnings Forecast
01 Financial Results for FY03/24 ー Overview of Consolidated Results ー Consolidated Earnings Forecast ー Shareholder Return 02 Progress of Transformation 2026 ー Executive Summary ー Progress of Measures 7 Copyright © 2024 Tsuzuki Denki Co., Ltd.
Slide 9: FY03/25 Consolidated Earnings Forecast
FY03/25 Consolidated Earnings Forecast Projecting a record profit in the Information Network Solutions business, primarily driven by expanding demand for AI PC installations and peripheral infrastructure upgrades, in addition to improved profitability of the overall business resulting from the execu
Slide 10: Shareholder Return
01 Financial Results for FY03/24 ー Overview of Consolidated Results ー Consolidated Earnings Forecast ー Shareholder Return 02 Progress of Transformation 2026 ー Executive Summary ー Progress of Measures 9 Copyright © 2024 Tsuzuki Denki Co., Ltd.
Slide 11: Shareholder Return
Shareholder Return Dividend yield Achieved a major dividend increase Year-end share price Dividend policy: Target dividend payout ratio of 40%, with a minimum DOE of 3.5% JPY1,100 JPY1,657 JPY1,480 JPY1,563 JPY2,336 (Profit attributable to owners of parent used for dividend calculation is based on p
Slide 12: 02 Progress of Transformation 2026
01 Financial Results for FY03/24 ー Overview of Consolidated Results ー Consolidated Earnings Forecast ー Shareholder Return 02 Progress of Transformation 2026 ー Executive Summary ー Progress of Measures 11 Copyright © 2024 Tsuzuki Denki Co., Ltd.
Slide 13: Positioning of the Medium-term Management Plan
Positioning of the Medium-term Management Plan First stage: Shift resources and put growing businesses on track to achieve our long-term vision 1st Stage 2nd Stage 3rd Stage 100th Anniversary Growth Navigator Operating income: JPY10.0bn Shift resources Scale growth areas Make growth areas into to gr
Slide 14: Overview of the Medium-term Management Plan Transformation 2026
Overview of the Medium-term Management Plan Transformation 2026 ～ Shift resources to growth areas FY03/23 FY03/26 targets results 1. Business Expand growth areas (vs. FY03/23) strategies Increase profitability of existing businesses Restructure business portfolio and Group companies Net sales Net sa
Slide 15: Executive Summary: Progress of the First Year of the Medium-term Plan
[Executive Summary] Progress and Overall Review of the First Year of the Medium-term Management Plan Steady progress in shifting resources to core businesses by reviewing business portfolio Achieved record profits close to the final-year target of the medium-term management plan, partly due to succe
Slide 16: Recognition of Challenges from the Perspective of Management Focused on Cost of Capital and Stock Prices
Recognition of Challenges from the Perspective of Management Focused on Cost of Capital and Stock Prices P/B ratio stayed above 1x after announcing the medium-term management plan, but some issues remain Tsuzuki System/network IT trading Sep. 29, 2023 Jan. 31, 2024 integrator average company average
Slide 17: Business Portfolio Review (Sale of the Electronic Devices Business)
Business Portfolio Review (Sale of the Electronic Devices Business) Resolved many issues by transforming into a pure-play ICT business, and aiming for further growth through concentrated resource allocation Recognition of challenges • Difficulty in creating business synergies due to differences in O
Slide 18: Profitability Enhancement of the Information Network Solutions Business
Profitability Enhancement of the Information Network Solutions Business [FY03/24 Progress] Lifted company-wide profitability by expanding the six growth areas with high added value and optimizing profits in existing areas ✓ Achieved solid results by implementing measures to strengthen each area FY03
Slide 19: Profitability Enhancement of the Information Network Solutions Business [FY03/25 Measures]
Profitability Enhancement of the Information Network Solutions Business [FY03/25 Measures] Aiming to establish a new business and further improve business structure by expanding on one year's initiatives. Special demand for EOS is in full swing. Planning to expand sales by proactively capturing busi
Slide 20: Growth Investments
Growth Investments Progress in FY03/24 outpaced the full-year plan, including for investments in business restructuring and personnel. Aiming to further promote strategic investments, including M&A. FY03/24 Category Total amount Details (FY03/24) (plan) Actual Progress (vs. total planed amount) • En
Slide 21: Financial Status (Current Cash Position)
Financial Status (Current Cash Position) Obtained cash as a result of divestments and financing activities Plan to invest in growth while maintaining appropriate capital control with an eye toward shareholder returns [Initial projection] *Three-year projection [First year of the medium-term manageme
Slide 22: Approach to M&A and Collaboration
Approach to M&A and Collaboration Approach all business areas with a view to compensating for shortfalls in our value chain Growth areas Cloud-based services, security products, DX products, etc. Growth potential Complement and acquire technology, products, and solutions New areas Growth areas Exist
Slide 23: Dialogue with Shareholders in FY03/24
Dialogue with Shareholders in FY03/24 The content of dialogue has changed in line with the new medium-term management plan, including topics such as cost of capital and valuation. However, challenges remain in terms of investor outreach. Category Overview Main President, Managing Executive Officer o
Slide 24: In Conclusion
In Conclusion We will pursue growth by transforming our business model We will strive to improve return on capital through strategic capital control We will continue to invest in our people, the source of our growth, and enhance our human capital We will strive to further enhance our corporate value
Slide 25: Contact
Contact Tsuzuki Denki Co., Ltd. Contact Management Planning Office Address 6-19-15 Shinbashi, Minato-ku, Tokyo 105-8665, Japan (Tokyo Art Club Building) Phone: 050-3684-7780 ir-tantou@tsuzuki.co.jp https://www.tsuzuki.co.jp/ Disclaimer The forward-looking statements, including earnings forecasts, co
Slide 26: Bring to society “yohaku”
Bring to society “yohaku” filled with possibilities, through people, insight, and technology, together.