Kawasaki Heavy Industries Ltd. · TSE:7012
Kawasaki Heavy Industries — Kawasaki Heavy Industrial — Q1 2021 Earnings Presentation
42 slides from Kawasaki Heavy Industries's earnings presentation, Aug 5, 2021
Slide 1: Financial Results for First Quarter FY2021
Financial Results for First Quarter FY2021 For the Year ending March 31, 2022 0 August 5, 2021 © Kawasaki Heavy Industries, Ltd. All Rights Reserved
Slide 2: Table of Contents
0 Table of Contents 1 Consolidated Results for 3 Details by segment First Quarter FY2021 Summary 3 Aerospace Systems 15 Segment 4 Rolling Stock 19 Income Statement 5 Energy Solution & Marine Engineering 23 Details of Change in Profit 7 Precision Machinery & Robot 27 Balance Sheet 9 Motorcycle & Engi
Slide 3: Consolidated Results for First Quarter FY2021 – Summary
Consolidated Results for First Quarter FY2021 1 –Summary- Sales and profit increased significantly due to the recovery from the impact of COVID-19 Operating profit was almost the same level as the highest profit in Q1 FY2013(¥16.7bn) for 10 years (Billion Yen) Net Sales 355.6 FY20 Q1 FY21 Q1 Change
Slide 4: Consolidated Results – Segment
Consolidated Results for First Quarter FY2021 1 –Segment- Operating losses decreased significantly in Aerospace Systems due to a recovery in flight demand ① Sales and profit increased significantly in Motorcycle & Engine due to strong demand for outdoor leisure in developed countries ② (Billion Yen)
Slide 5: Income Statement
1 Consolidated Results for First Quarter FY2021 –Income Statement- (Billion Yen) Details FY20 Q1 FY21 Q1 Change % % Net Sales 300.6 100.0 355.6 100.0 + 55.0 ① Increase in sales costs in Motorcycle & Engine Cost of sales 278.3 92.6 293.6 82.6 + 15.2 Gross profit 22.2 7.4 62.0 17.4 + 39.7 ② Yen/US$ ra
Slide 6: Income Statement (continued)
1 Consolidated Results for First Quarter FY2021 –Income Statement- (Billion Yen) Details FY20 Q1 FY21 Q1 Change % % Recurring Profit (Loss) - 18.9 - 6.3 13.1 3.7 + 32.0 ④ Sale of land Extraordinary Income / Losses 4.8 1.5 - 3.2 Gain on sales of fixed assets 5 3.2 4 1.6 - 1.6 ⑤ Sale of dormitory /com
Slide 7: Details of change in profit
Consolidated Results for First Quarter FY2021 1 –Details of change in profit- Motorcycle & Engine accounted for 80% of the change in sales and 40% of the change in product mix and other factors Jet engine maintenance costs, which had recorded a significant loss in the Q1 FY2020, were decreased Q1 FY
Slide 8: Details of change in profit by segment
Consolidated Results for First Quarter FY2021 1 –Details of change in profit- (Billion Yen) FY20 Q1 FY21 Q1 Operating Change in Change in Operating Profit Effects of Change Profit product mix and SG & A Total (Loss) FX rates※ in sales※ other factors※ expenses (Loss) Aerospace Systems - 17.5 0.6 0.9
Slide 9: Balance Sheet
1 Consolidated Results for First Quarter FY2021 –Balance Sheet- (Billion Yen) End of End of Details Change Mar. 2021 % Jun. 2021 % Cash and deposits 126.7 122.0 - 4.6 ① A portion of trade receivable in Aero Engine Trade receivables 1 (approximately ¥22 billion) 460.4 410.0 - 50.4 2 - was reduced as
Slide 10: Balance Sheet (liabilities and net assets)
1 Consolidated Results for First Quarter FY2021 –Balance Sheet- (Billion Yen) End of End of Details Change Mar. 2021 % Jun. 2021 % 1 Trade payables 355.1 314.8 - 40.3 ① Decreased mainly in 2 Aerospace and Motorcycle Interest-bearing debt 593.3 644.9 + 51.6 Contract liability (Advances received) 153.
Slide 11: Cash Flows
1 Consolidated Results for First Quarter FY2021 –Cash Flows- (Billion Yen) Details FY20 Q1 FY21 Q1 Change Income before income taxes - 14.1 14.6 + 28.7 ① Q1 FY’20 Significant outflow of Depreciation and amortization 15.0 14.8 - 0.1 funds in working capital Increase and decrease in working capital -
Slide 12: Cash Flows
1 Consolidated Results for First Quarter FY2021 –Cash Flows- Continued negative operating cash flow due to heavy working capital, mainly in Aero Engine Operating cash flow is improving due to the contribution of the mass-production businesses (billion yen) CF from operating acitivities CF from inves
Slide 13: Earnings Forecasts for FY2021 – Summary
Earnings Forecasts for FY2021 2 -Summary- Operating profit forecast was revised up due to depreciation yen and the strong performance of Motorcycle & Engine No significant adjustment were made to net income due to deterioration in non-operating profit and increased tax expenses, despite an increase
Slide 14: Forecasts for FY2021 – Segment
2 Forecasts for FY2021 -Segment- Aerospace Systems will improve profitability, but the situation will remain tough Forecasts of Motorcycle & Engine were significantly revised up due to the strong demand for motorcycles and off-road four wheeler (Billion Yen) Orders Received Net Sales Operating Profi
Slide 15: Aerospace Systems
3 Details by Segment -Aerospace systems- FY2021.Q1（vs. FY2020.Q1） Orders Decreased due to a decrease in component parts for commercial aircraft jet engines caused by the application of received new Accounting Standard for Revenue Recognition and other factors, despite an increase in helicopters Net
Slide 16: Aerospace Systems
3 Details by Segment -Aerospace systems- (Billion Yen) FY2020 FY2021 FY2020 FY2021 Forecast Q1 Actual Q1 Actual Change Actual Old FCST New FCST Chg. Vs. FY20 Chg. Vs. Old FCST Q2-4 FCST Orders Received 45.4 37.4 - 7.9 329.5 310.0 310.0 - 19.5 - 272.6 Aerospace 24.0 27.5 + 3.4 236.2 240.0 250.0 + 13.
Slide 17: Aerospace Systems
3 Details by Segment -Aerospace systems- Net Sales (billion yen) 161.1 Aerospace Aero Engines 135.8 126.6 128.7 122.2 117.9 122.1 120.5 114.7 105.9 104.9 105.2 109.3 99.7 93.9 74.6 70.0 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q FY2017 FY2018 FY2019 FY2020 FY2021 Operating Income (billion ye
Slide 18: Aerospace Systems – Market Overview and Specific Efforts
3 Details by Segment -Aerospace systems- Market Overview Specific Efforts Commercial aircraft business Securing stable revenue in core business – Global passenger demand remains weak – Cost reductions in existing orders of aircrafts for Boeing and commercial aircrafts jet engines due to the grea
Slide 19: Rolling Stock
3 Details by Segment - Rolling Stock - FY2021.Q1（vs. FY2020.Q1） Orders received Decreased compared with FY2020 1Q when major orders for Shinkansen were received Net Sales Decreased due to a decrease in regions other than the U.S Operating Improved due to improved profitability of overseas projects t
Slide 20: Rolling Stock
3 Details by Segment - Rolling Stock - (Billion Yen) FY2020 FY2021 FY2020 FY2021 Forecast Q1 Actual Q1 Actual Change Actual Old FCST New FCST Chg. Vs. FY20 Chg. Vs. Old FCST Q2-4 FCST Orders Received 18.7 9.3 - 9.4 77.0 70.0 70.0 - 7.0 - 60.7 Domestic & Asia 13.2 6.1 - 7.1 66.2 67.0 66.0 - 0.2 - 1.0
Slide 21: Rolling Stock
3 Details by Segment - Rolling Stock - Net Sales (billion yen) Domestic & Asia North America 41.9 40.6 38.6 38.8 38.1 39.0 36.1 36.8 34.5 32.3 32.3 31.7 29.1 28.7 23.3 22.0 20.4 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q FY2017 FY2018 FY2019 FY2020 FY2021 9.1% 5.9% 3.1% 3.4% 0.0% - 3.2% - 2.
Slide 22: Rolling Stock – Market Overview and Specific Efforts
3 Details by Segment - Rolling Stock - Market Overview Specific Efforts Compliance with delivery schedules for The impact of COVID-19 overseas projects – Some domestic railway operators are Delivery of the first train to Dhaka FY2021 Q1 reviewing their railway related The first and second train
Slide 23: Energy Solution & Marine Engineering
Details by Segment 3 - Energy Solution & Marine Engineering - FY2021.Q1（vs. FY2020.Q1） Orders received Increased due to an increase in renovation work for domestic municipal waste incineration plants, and other projects Net Sales Decreased due to a decrease in repair work for submarines despite an i
Slide 24: Energy Solution & Marine Engineering
3 Details by Segment - Energy Solution & Marine Engineering - (Billion Yen) FY2020 FY2021 FY2020 FY2021 Forecast Q1 Actual Q1 Actual Change Actual Old FCST New FCST Chg. Vs. FY20 Chg. Vs. Old FCST Q2-4 FCST Orders Received 56.2 60.9 + 4.6 317.1 400.0 400.0 + 82.9 - 339.1 Energy System 46.2 55.5 + 9.
Slide 25: Energy Solution & Marine Engineering
3 Details by Segment - Energy Solution & Marine Engineering - Net Sales (billion yen) Energy System & Plant Engineering Ship & Offshore Structure 112.0 100.1 103.8 99.3 88.2 84.2 82.5 77.7 73.2 73.0 70.5 72.2 70.5 72.8 70.3 67.9 64.8 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q FY2017 FY2018 F
Slide 26: Energy Solution & Marine Engineering – Market Overview and Specific Efforts
3 Details by Segment - Energy Solution & Marine Engineering - Market Overview Specific Efforts Focus on sales activities to recover orders Energy system & Plant Engineering – Aiming to steadily take in new projects that have Domestic Emerging Markets been temporarily frozen due to the impact of
Slide 27: Precision Machinery & Robot
3 Details by Segment - Precision Machinery & Robot - FY2021.Q1（vs. FY2020.Q1） Orders Increased due to an increase in hydraulic components for construction machinery and various robots including robots for received semiconductor manufacturing equipment Net Sales Same as above Operating Increased due
Slide 28: Precision Machinery & Robot
3 Details by Segment - Precision Machinery & Robot - (Billion Yen) FY2020 FY2021 FY2020 FY2021 Forecast Q1 Actual Q1 Actual Change Actual Old FCST New FCST Chg. Vs. FY20 Chg. Vs. Old FCST Q2-4 FCST Orders Received 50.7 65.1 + 14.4 259.4 260.0 260.0 + 0.6 - 194.9 Hydraulic 35.9 41.1 + 5.1 172.6 165.0
Slide 29: Precision Machinery & Robot
3 Details by Segment - Precision Machinery & Robot - Net Sales (billion yen) Hydraulic Components & Systems Robotics 86.6 67.8 70.3 62.6 55.2 57.6 54.1 52.1 53.6 49.3 47.9 48.3 49.8 48.8 45.1 45.4 41.8 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q FY2017 FY2018 FY2019 FY2020 FY2021 11.5% 10.9%
Slide 30: Precision Machinery & Robot – Market Overview and Specific Efforts
3 Details by Segment - Precision Machinery & Robot - Market Overview Specific Efforts Construction machinery Developing electrification and automation – Although high level of demand continues in technology for construction machinery Chinese market, some construction – Development and supply of
Slide 31: Motorcycle & Engine
3 Details by Segment - Motorcycle & Engine - FY2021.Q1（vs. FY2020.Q1） Net Sales Increased due to an increase in off-road motorcycles and four-wheelers for North America and a increase in motorcycles for Europe and Southeast Asia, Operating Increased due to an increase in revenue, depreciation of yen
Slide 32: Motorcycle & Engine
3 Details by Segment - Motorcycle & Engine - (Billion Yen) FY2020 FY2021 FY2020 FY2021 Forecast Q1 Actual Q1 Actual Change Actual Old FCST New FCST Chg. Vs. FY20 Chg. Vs. Old FCST Q2-4 FCST Net Sales 58.9 113.5 + 54.5 336.6 380.0 410.0 + 73.4 + 30.0 296.5 Motorcycles for developed contries 24.7 46.6
Slide 33: Motorcycle & Engine
3 Details by Segment - Motorcycle & Engine - Net Sales (billion yen) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q FY2017 FY2018 FY2019 FY2020 FY2021 Operating Income (billion yen) 8.2% 13.0% 10.3% 11.0% 8.8% 6.7% 5.6% 1.8% 2.3% 0.9% - 0.6% - 1.3% - 1.9% - 4.9% - 4.4% - 4.1% - 10.0% © © Kawasaki K
Slide 34: Motorcycle & Engine – Market Overview and Specific Efforts
3 Details by Segment - Motorcycle & Engine - Market Overview Specific Efforts U.S. Supplying products as much as demanded – Demand for off-road motorcycles and four- – All efforts to achieve production plans wheelers remained strong – Changing production and sales plans promptly – Strong demand
Slide 35: Shareholder Return
4 Shareholder Return Dividend Policy Dividend for FY2021 The forecast of operating profit was revised up by 10 billion yen 1 Future business forecasts, Financial conditions such as free cash flow and The forecast of net income attributable to owners of the parent debt-to-equity ratio, and other
Slide 36: Project Topics: First Sustainability Bond
4 Project Topics Our first Sustainability Bond is to issued The first sustainability bond focusing on Hydrogen business in Japan Accelerating sustainability management to Realize “Group Vision 2030: Trustworthy Solutions for the Future.” in order to contribute for SDGs Strengthening engagement
Slide 37: Project Topics: Automated PCR viral testing service
4 Project Topics Progress of automated PCR viral testing service Started nation’s first automated PCR viral testing service using a robot system at Fujita Health University (in Aichi prefecture) in March, 2021 Started joint research project together with Kyoto University Hospital and Sysmex Corp
Slide 38: Project Topics: Joint venture with Sony Group
4 Project Topics Agreement for the establishment of a joint venture with Sony Group Corporation to realize new lifestyles and ways of working in the society of the future Building remote robot platforms that will connect people with a desire to work with companies who wish to hire them → ensuring
Slide 39: Appendix – CAPEX, Depreciation and Amortization, R&D Expenses, Employees
4 Appendix - CAPEX, Depreciation and Amortization, R&D Expenses, Number of employees - (Billion Yen, Persons) FY2020 FY2021 FY2020 FY2021 Q1 Actual Q1 Actual Change Actual FCST Chg. Vs. FY20 CAPEX 14.2 10.5 - 3.6 55.6 56.0 + 0.4 Depreciation and amortization 14.9 14.8 - 0.1 61.2 63.5 + 2.3 R & D exp
Slide 40: Appendix – Others: Order Backlog, Sales by Region, Ship Delivery
4 Appendix - Others - Order Backlog Order Backlog in Ship & Offshore (billion yen) (billion yen) 191.6 FY20 Q1 FY21 Q1 Actual Actual Change Aerospace Systems 546.8 496.8 - 49.9 99.1 101.6 104.6 Rolling Stock 485.8 423.8 - 62.0 90.6 85.9 Energy Solution & Marine Engineering 460.7 464.9 + 4.2 Prec
Slide 41: Appendix – Net Sales in Foreign Currencies by Segment
4 Appendix - Others - Net Sales in Foreign Currencies by Segment (billion USD) FY'20 FY'21 1Q Actual Q2-4 FCST Aerospace Systems 0.08 0.16 0.63 Rolling Stock 0.01 0.04 0.02 Energy Solution & Marine Engineering 0.07 0.02 0.18 Precision Machinery & Robot 0.04 0.08 0.11 Motorcycle & Engine 0.04 0.12
Slide 42: © Kawasaki Heavy Industries, Ltd. All Rights Reserved
© Kawasaki Heavy Industries, Ltd. All Rights Reserved
Kawasaki Heavy Industrial — Q1 2021 Earnings Presentation on 6ix