Fuji Seal International, Inc. · TSE:7864
Fuji Seal International — Q2 FY2023 Earnings Presentation
32 slides from Fuji Seal International's earnings presentation, Nov 9, 2023
Slide 1: FY2023 Second Quarter Financial Results Supplementary Briefing Materials
FY2023 Second Quarter Financial Results Supplementary Briefing Materials Fuji Seal International, Inc. November 9, 2023 Copyright 2023 Fuji Seal Group
Slide 2: Table of Contents
Table of Contents 1. Financial Results for the Second Quarter of FY 2023 2. Shift to management based on cost of capital 3. Initiatives for Sustainable Growth • Our Strength + Solid business foundation →Sustainable growth strategy • Steadily strengthen four businesses • Expansion of product markets
Slide 3: Key Points of FY2023 2Q Financial Results and Progress toward Full-Year Earnings Forecasts
Key Points of FY2023 2Q Financial Results and Progress toward Full-Year Earnings Forecasts Net sales and profit at each stage increased in 1st half compared to the same period of the previous year. *Net sales has decreased but OP has increased excluding the effect of foreign exchange rate fluctuat
Slide 4: FY2023 2Q Financial Results (1) Net Sales by Region
FY2023 2Q Financial Results (1) Net Sales by Region Consolidated net sales declined slightly excluding the effect of foreign exchange rates. By region, sales in Japan increased YoY, while sales outside of Japan declined. Copyright 2023 Fuji Seal Group 4
Slide 5: FY2023 2Q Financial Results (2) Net Sales by Segment by Region
FY2023 2Q Financial Results (2) Net Sales by Segment by Region Year-on-year change FY2022 FY2023 Excluding forex • Shrink Sleeve Label (SSL) sales increased due to a recovery in the beverage (Millions of yen) 2nd quarter 2nd quarter Change Rate of change impact Rate of change sector as a result of t
Slide 6: FY2023 2Q Financial Results (3) Operating Profits by Region
FY2023 2Q Financial Results (3) Operating Profits by Region Consolidated operating profit increased due to the recovery of performance in the European region and ASEAN region. • Shrink Sleeve Label (SSL) profit are on the road to FY2022 FY2023 Year-on-year recovery due to improved productivity, wh
Slide 7: FY2023 2Q Financial Results (4) Non-operating Income (Expenses), Ordinary Profits, and Net Profits
FY2023 2Q Financial Results (4) Non-operating Income (Expenses), Ordinary Profits, and Net Profits Increase/Decrease 【Non-operating income】 FY2022 FY2023 (Millions of yen) 2nd quarter 2nd quarter • Foreign exchange gains mainly due to the effect of (Amount) (%) exchange rate changes on cash and cash
Slide 8: FY2023 2Q Financial Results (5) B/S
FY2023 2Q Financial Results (5) B/S (million-yen) Working capital increased due to foreign exchange effects and the end of the second quarter being a holiday for financial institutions. Tangible fixed assets increased with the start of operations of the new North Carolina plant in the Americas. Cu
Slide 9: FY2023 2Q Financial Results (6) Cash flows and depreciation
FY2023 2Q Financial Results (6) Cash flows and depreciation (million-yen) Free cash flow turned positive from negative in the same period of the previous year as business performance recovered, Cash flows from operating activities exceeded those of the second quarter of FY2021. Cash flows from ope
Slide 10: Dividends from surplus
Dividends from surplus The interim dividend will be paid at the end of the second quarter as originally planned. • Interim dividend 17 yen per share • Total amount of dividends paid 931 million yen • Payment start date December 1, 2023 Basic Policy on Profit Distribution • Investments for continuous
Slide 11: Table of Contents
Table of Contents 1. Financial Results for the Second Quarter of FY 2023 2. Shift to management based on cost of capital 3. Initiatives for Sustainable Growth • Our Strength + Solid business foundation →Sustainable growth • Steadily strengthen four businesses • Expansion of product markets and targe
Slide 12: 2. Shift to management based on cost of capital
2. Shift to management based on cost of capital issue Approaches to Challenges Our Specific Efforts Horizontal deployment of new model plants Expansion of domestic and overseas pharmaceutical Working capital Clearly articulate a vision for future business improvement sustainable growth Busin
Slide 13: 2. Shift to management based on cost of capital
2. Shift to management based on cost of capital (Unit: Oku yen) • In the most recent period, the working capital turnover period deteriorated sharply due to the impact of foreign exchange rates and the sharp rise in raw material prices. • Free cash flows were temporarily negative, partly due to lowe
Slide 14: Revision of business and product portfolios
2. Shift to management based on cost of capital: Revision of business and product portfolios • Considers revising the cost of shareholders' equity beginning in FY2023. Expected to be higher than the previous range. • In addition, strict application of investment and exit standards to accelerate the
Slide 15: Aggressive investment in growth businesses and regions
2. Shift to management based on cost of capital: Aggressive investment in growth businesses and regions Resumption of investments in growth businesses and regions from the current period, which had been restrained during the period of the Covid-19 Disaster. Selected investments that exceeded the hur
Slide 16: Review of Shareholder Return Policy
2. Shift to management based on cost of capital: Review of Shareholder Return Policy • While the company has traditionally provided stable shareholder returns, its equity capital has increased each fiscal year. In the future, the company will consider changing its dividend policy in accordance with
Slide 17: Table of Contents
Table of Contents 1. Financial Results for the Second Quarter of FY 2023 2. Shift to management based on cost of capital 3. Initiatives for Sustainable Growth • Our Strength + Solid business foundation →Sustainable growth strategy • Steadily strengthen four businesses • Expansion of product markets
Slide 18: Sustainable Business Growth
Our Strength + Solid business foundation →Sustainable growth strategy Creation of new business models that Sustainable Business Growth will lead to the next generation Human Environment Valued Customer Capital Expansion of Product Market / Target Area Global Presence Governance IP strategy Steadily
Slide 19: Solid Business Foundation: Coexistence with the Environment
Solid Business Foundation: Coexistence with the Environment Recycle Package Environment Policy Promotion of ESG Expansion of Environment Waste Reduction Initiatives Established Management Friendly Packaging Supply of labels for Safety Circular Economy Initiatives Reduction of Use of Renewable energy
Slide 20: Solid Business Foundation: Intellectual Property strategy
Solid Business Foundation: Intellectual Property strategy Start of Idea Bank Aggressive investment in intellectual Expansion of IP Governance property Structure Fostering Sources of Competitive Advantage Copyright 2023 Fuji Seal Group 20
Slide 21: Solid Business Foundation: Human Capital investment
Solid Business Foundation: Human Capital investment Overseas Expansion The Desirable Person Next Generation Management development program Establishment of DE&I Committee (Diversity) Organizing Family Festivals Disclosure of Skills Chart Value Seminar External Evaluation Penetration of Fuji Seal Way
Slide 22: Solid Business Foundation: Governance
Solid Business Foundation: Governance Establishment and renewal of the Code of Ethics Establishment of Compliance Committee Matrix Management Corporate governance report Company with a Nominating Committee Strengthening Information Security Established Materiality Evaluation of the Effectiveness of
Slide 23: Improve ESG evaluation
UPDATE. Improve ESG evaluation Assessment of ESG survey 2022 2023 Continued to be selected as a constituent of the ESG Index MSCI 7.325 6.25625 • MSCI (WIN) Japan Equity Women's Activity Index (WIN, 368 stocks) from 2019 • FTSE FTSE 3.5 3.7 Blossom Japan Index (253 stocks) in 2021 • S&P Second decil
Slide 24: Sustainable Growth: Three Basic Strategies
Sustainable Growth: Three Basic Strategies Creation of new business models ・Seed and nurture start-up businesses that will lead to the next that will become future mainstay generation businesses Sustainable Business Growth Expansion of ・Expansion of business areas utilizing Product Market / Target A
Slide 25: Provision of Environmentally Friendly Product ~Initiatives~
UPDATE Steadily reinforce the 4 existing business units Provision of Environmentally Friendly Product ～Initiatives～ Label to Label （Post Consumer Recycling） We will conduct Label to Label collection from the market through two initiatives and evaluate the way to recycle our shrink sleeve. • We initi
Slide 26: Region Growth Strategy: Japan Business Restructuring
NEW Steadily reinforce the 4 existing business units Region Growth Strategy: Japan Business Restructuring Oct 1st, 2023, due to corporate separation, consolidated subsidiaries transferred to Fuji Seal, Inc. By shifting to a divisional structure, we will transform ourselves into a highly agile and
Slide 27: Expansion of pharmaceutical business
UPDATE. Expansion of Product Market / Target Area Expansion of pharmaceutical business CMO Business Progress We will further develop the pharmaceutical packaging business, which we have been working on, and grow it into a new business pillar that will enable sustainable growth. CMO Business Sales
Slide 28: Expansion of pharmaceutical business: Line Engineering Business
NEW Expansion of Product Market / Target Area Expansion of pharmaceutical business Line Engineering Business By utilizing our strengths in "Packaging Materials", "Machinery", and "Pharmaceutical Packaging CMO Business", we are able to provide our customers with the highest quality products and ser
Slide 29: India Business Expansion
UPDATE. Expansion of Product Market / Target Area India Business Expansion Contract packaging business in India Business Strategy Strengthening the global responsiveness of services • Global operations with highly skilled human resources • Enhanced responsiveness. Needs of the Environment • Taking a
Slide 30: Creation of new business models: Deep IS individual identification technology
UPDATE. Creation of new business models that will TM lead to the next generation Individual identification technology Deep IS TM Use Case Examples What is Deep IS? ▶Dr. Ricella Revolutionary security system In order to counteract the increasingly sophisticated online fraudulent resale of cosmetics,
Slide 31: Our Vision
Our Vision Copyright 2023 Fuji Seal Group 31
Slide 32: Cautionary Statement
Cautionary Statement This report is intended to provide a better understanding of the Fuji Seal Group and is not necessarily intended to recommend investment. This report includes earnings forecasts and business plans, which are based on certain assumptions in the economic environment and business p
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