Slide 1: FY2011 Business Outlook
May 13, 2011 FY2011 Business Outlook
Slide 2: Agenda
Agenda 1 Corporate Information 2 FY2010 Results 3 FY2011 Outlook 4 Future Steps 2
Slide 3: History
History 1987 / 1 ： Innotech founded / 7 ： Launched sales of Cadence products 1990/ 9 ： Listed as public company at Jasdaq Securities Exchange 2000/ 4 ： Established IT Access Inc. 2002/ 3 ： Acquired Sanei Hytechs Co. Ltd., 2003/11 ： Launched “Revival Plan” 2005/10 ： Commenced developing proprietary t
Slide 4: Company Data
Company Data Founded : January 5, 1987 Number of Employees : 592 (consolidated) Listed Stock Exchange : Tokyo Stock Exchange first Section CEO & President : Makoto Sumita Head Office : Yokohama-shi, Kanagawa Overseas Office : Hong Kong, Shang Hai, Singapore http://www.innotech.co.jp/ i
Slide 5: Innotech Business Area
Innotech Business Area Semiconductor Design Electronic Components CAD for Semiconductors Electronic Devices Testers for Semiconductors Hard Disk Drives 5
Slide 6: Innotech Uniqueness/Advantages
Innotech Uniqueness/Advantages Now Collaboration with strong venders and distribution of attractive products Enlarging customer base High engineering skills Strong Financial Structure In the past Too many products to support Unstable customer base Fragile financial structure 6
Slide 7: Partner Companies Supporting Core Businesses
Partner Companies Supporting Core Businesses Transaction Venders Business Superiority Innotech Services period Technical support Leading the industry CADENCE Competing for a top position with Synopsys. 23years New business development Holds No. 1 share for HDDs.(Japan domestic) Technical support Hit
Slide 8: Technical Expertise Satisfying Vender and Customer Needs
Technical Expertise Satisfying Vender and Customer Needs Innotech Engineering Skills Canon CADENCE Ricoh Hitachi GST Rohme Technical Support Technical Maintenance/training Support DNP Intel Sony Developed internally Development of embedded boards Sanyo Elec. Silicon Image Toshiba Design Software Sha
Slide 9: Financial Structure Substantially Improved
Financial Structure Substantially Improved ■ Debt Ratio and Capital Adequacy Ratio (%) 80 FY1998 Interest-bearing debt: 45.3 billion yen 70 Interest-bearing debt ratio 60 Capital adequacy ratio 50 40 30 FY2010 :Interest-bearing debt: 1 billion yen 20 10 0 FY1998 FY1999 FY2000 FY2001 FY2002 FY2003 FY
Slide 10: Agenda
Agenda 1 Corporate Information 2 FY2010 Results 3 FY2011 Outlook 4 Future Steps 10
Slide 11: FY2010 Highlights
FY2010 Highlights YoY Double Ordinary Profit Achieved Tester business bounced back due to active NAND market Rapid recovery of subsidiary businesses 5.9% of Ordinary Profit Ratio achieved by Gross Profit Rate Increase 11
Slide 12: FY2010 Actual
FY2010 Actual 〔million yen〕 Sanei Innotech IT Access Consolidated YoY Hytechs FY2010 FY2009 FY2010 FY2009 FY2010 FY2009 FY2010 FY2009 Net Sales 19,211 19,406 2,691 2,378 3,804 2,675 25,882 24,492 6% G r o s s 4,035 3,517 670 429 1,096 798 6,004 4,933 22% P r o f i t (21.0%) (18.1%) (24.9%) (18.0%) (
Slide 13: FY2010 Semiconductor Design Business
FY2010 Semiconductor Design Business Sales EDA Tester ASIC Design Consignment (Sanei Hytechs) [mil. yen] 9,854 10,305 10,000 2,323 2,640 533 211 Sales 449 1,714 5,000 6,549 5,740 2,633 3,394 0 FY2009 FY2010 Gross Profit 13
Slide 14: FY2010 Electronic Component Business
FY2010 Electronic Component Business Sales HDD Electronic Devices Embedded Software Development (IT ACCESS) [mil. yen] 15,576 15,000 14,637 2,669 3,987 10,000 3,770 4,680 5,000 8,198 6,910 2,300 2,610 0 FY2009 FY2010 Gross Profit 14
Slide 15: Tester Business and Subsidiary Businesses Drove Recovery
Tester Business and Subsidiary Businesses Drove Recovery Te s t e r S a l e s i n c r e a s e d b y 3 . 8 t i m e s Strong NAND flash memory demands for smartphones and tablet PCs; our cost reduction efforts also contributed to the results Sanei H yt ec hs O r dina r y Pr of it inc r eas e d by 2.4
Slide 16: Improvement in Profit Ratio
Improvement in Profit Ratio 〔％〕 ％ ％ Gross Profit Ratio increase Gross profit rate improved due to growth in high profitability by 3.1％ points businesses such as embedded software and tester Ordinary Profit Ratio Increase by 2.9％ points HDD business also grew in the highly profitable area EDA busines
Slide 17: Agenda
Agenda 1 Corporate Information 2 FY2010 Results 3 FY2011Outlook 4 Future Steps 17
Slide 18: Highlights of FY2011 Estimate
Highlights of FY2011 Estimate Targeting to increase profitability regardless of the aftermath of the earthquake and tsunami Sales from HDD Business is expected to decline substantially due to the aftermath of the earthquake and tsunami Tester Business is expected to grow substantially due to active
Slide 19: FY2011 Estimate
FY2011 Estimate 〔million yen〕 Sanei IT Overseas Innotech Consolidated FY2010 YoY Hytechs ACCESS Sales Net Sales 20,400 2,700 3,700 5,500 26,000 25,882 0% Gross Profit 4,400 620 1,070 120 6,250 6,004 4% (21.6%) (23.0%) (28.9%) (2.2%) (24.0%) (23.2%) Operating 1,000 270 370 0 1,500 1,455 3% P r o f i
Slide 20: FY2011 Outlook: Semiconductor Design Business
FY2011 Outlook: Semiconductor Design Business Sales EDA Tester ASIC Design Consignment (Sanei Hytechs) [million yen] 12,300 10,305 2,700 10,000 2,640 400 211 3,000 1,714 5,000 6,200 5,740 3,394 3,950 0 FY2010 FY2011 Gross Profit 20
Slide 21: FY2011 Outlook: Electronic Component Business
FY2011 Outlook: Electronic Component Business Sales HDD Electronic Devices Embedded Software Development (IT ACCESS) [million yen] 15,576 15,000 13,700 3,987 3,700 10,000 4,680 5,800 5,000 6,910 4,200 2,610 2,300 0 FY2010 FY2011 Gross Profit 21
Slide 22: Aftermath of the Earthquake - HDD Sales will decline substantially
Aftermath of the Earthquake -HDD Sales will decline substantially- Shipment of 3.5 inch HDD is expected to decline s u b s t a n t i a l l y f r o m t h e 2 nd q u a r t e r 2.5inches HDD business not affected by the earthquake Special loss associated with the earthquake and tsunami is already inclu
Slide 23: New Growth in the Tester Business
New Growth in the Tester Business Strong NAND demands driven by smartphones and tablet PCs Accelerate development of the next generation model QUEST shipment starts 〔mil. yen〕 テTester ス タ ー Sales 売上高 FY2009 FY2010 FY2011 Contributes to the Demand o v e r a ll F Y 2 0 11 recovered from Results FY2010
Slide 24: Dividends
Dividends Dividend 1H 2H FY Payout Ratio FY2010 4 yen 8 yen 12 yen 27.3％ FY2011 6 yen 6 yen 12 yen 25.6％ （Estimate） Our dividend payout ratio is planned to be more than 25% in a consolidated basis. Our FY 2010 final dividends are: -common dividend 6 yen -commemorative dividend 2 yen 24
Slide 25: Agenda
Agenda 1 Corporate Information 2 FY2010 Results 3 FY2011 Outlook 4 Future Steps 25
Slide 26: Future Steps for Growth
Future Steps for Growth Getting listed in the First Section of the Tokyo Stock Exchange Renewal of Cadence Distribution Agreement Progress in Intel Business Establish ourselves as an EDS company 26
Slide 27: Getting Listed in the First Section of the Tokyo Stock Exchange
Getting Listed in the First Section of the Tokyo Stock Exchange Strengthening our IR activities Employing highly talented people Leveraging the capital market Business Recovery Establish More Resourceful Internal Organization 27
Slide 28: Renewal of Cadence Distribution Agreement
R e n e w a l o f C a d e n c e D i s t r i b u t i o n Ag r e e m e n t Current term: 7 years (until end of 2017) Strengthen partnership Establish solid profitability base by obtaining many more multi-year contracts Successfully won large order for Office Automation and electronic components 〔mil.
Slide 29: Progress of Intel Business
Progress of Intel Business Sept. 2010 Launched “TX-50”, CPU module incorporating Atom Processor Apr. 27 2011 Launched “TX-70”, CPU module for embedded applications May 10 Opened a forum site called “EM-club” May 11-13 Embedded Systems Expo & Conference 「TX-70」 ・ Solutions for digital signage ・ Andro
Slide 30: Evolution as an EDS Company
Evolution as an EDS Company Now 5 years later Networking each business Semiconductor Design Introduction of new technologies Products Electronic Components Proposing new products and services Customers Japanese Companies Include global companies Role Supporting the Japanese Leading growth of the ent
Slide 31: Achieving High Growth by Setting the EDS Business as a Core
Achieving High Growth by Setting the EDS Business as a Core 【mil. yen】 経常利益 Ordinary Aiming to achieve over 25% of 4,000 Profit Gross Profit Ratio 3,000 2,000 1,000 0 04/3 05/3 06/3 07/3 08/3 09/3 10/3 11/3 12/3 13/3 -1,000 To a New Growing Phase Structure Strategy Advanced Service New Innotech ODM
Slide 32: Note for Forward Looking Statements
Note for Forward Looking Statements The information provided in this presentation includes forward looking statements based on current expectations, forecasts or beliefs. Such forward looking statements include a number of preliminary assumptions about future events that are subject to factors and u