Air Water Inc. · TSE:4088
Air Water — Investor Presentation (August 2024)
40 slides from Air Water's investor presentation, Aug 21, 2024
Slide 1: IR Briefing
IR Briefing Meeting society’s needs with nature’s blessings. @ AIR WATER August 21, 2024
Slide 2: Today's Agenda
Today’s Agenda 1 Management policy and overall strategy 2 Strategies in focus areas 3 Questions and answers © AIR WATER INC. | 2
Slide 3: Efforts to Increase Share Price = PBR
Efforts to Increase Share Price = PBR Indicators Issues Revenue Operating Net assets profit Maximizing OCF Improveme SG&A nt of free expenses ROIC Working cash flow capital ROE Invested Non-current Improving cash flows from investing capital assets PBR activities Other Asset-light assets Interest-be
Slide 4: History of Growth
History of Growth © AIR WATER INC. | 4
Slide 5: History of Growth
History of Growth Revenue has grown approx. 4.6 fold (CAGR: 7.2％) and operating profit has grown approx. 4.8 fold (CAGR: 7.4%), compared to the levels at the time Air Water was founded. (Billion yen) 80 800 Creating new value by 1,200 12,000 solving social issues Air Water Third 700 Foundation 1,000
Slide 6: History of Growth
History of Growth Founding of Renovation Target 3600 Next-2020 terrAWell30 Air Water 330 389.6 546.6 246.7 207.4 100 64.5 2,395 3,000 Market capitalization 1,720 90 (billion yen) 2,500 1,447 80 70 1,070 64 2,000 60 56 1,500 425 Share price (yen) 50 1,000 40 22 500 30 20 0 8 20 Dividend to 10 (500) s
Slide 7: History of Growth: growth investments in equipment and M&A
History of Growth Capital expenditures M&A Operating profit Third First Foundation Second Foundation Foundation Amount of capital investment and amount invested in M&A activities Including the acquisition of First Foundation Second Foundation onsite operations in India Capital investment: Capital in
Slide 8: History of Growth
History of Growth Solidified foundation as a comprehensive Established a business portfolio that enables industrial gas manufacturer stable growth 4% 10% 11% 14% 33% 38% 8% 21% FY2000 19% FY2009 FY2023 Consolidated revenue 222.0 billion yen 55% Consolidated revenue Consolidated revenue 426.3 billion
Slide 9: Long-Term Vision and Themes of Focus Businesses
Long-Term Vision and Themes of Focus Businesses © AIR WATER INC. | 9
Slide 10: Business Environment and Long-Term Vision
Business Environment and Long-Term Vision Global Social issues Era of people population Global warming living to 10.0 Food security 100 billion Prolongation of healthy years of age in 2060 life extension AW Group More than Wellness 100 Global environment (Healthy living) businesses © AIR WATER INC.
Slide 11: Business Framework
Business Framework Purpose Becoming a company that solves social issues Carbon Agriculture Neutrality Digital & Industry Health & Safety Energy solutions Agriculture & Foods Positioning industrial gases as the foundation of cash creation and expanding related businesses Industrial gases Achieving gr
Slide 12: Air Water's Areas of Focus
Air Water's Areas of Focus Overseas Technologies Logistics Semiconductors ⚫ Semiconductor-related ⚫ Locations and ⚫ Functional material network Gas process engineering Carbon Neutrality ⚫ ⚫ Gas supply equipment Decarbonization Capital for Agriculture ⚫ ⚫ Resource recycling GX investments in focus ar
Slide 13: Semiconductor Businesses
Semiconductor Businesses Gases, chemicals, Equipment and Services and materials engineering Semiconductor plant Materials management Bulk gases service Chemicals and Resource recycling materials Special chemicals/special Logistics gases Comprehensive Special gas/special chemical/slurry supply propos
Slide 14: Agricultural Sector
Agricultural Sector Formed a capital and business alliance with SHINMEI Holdings Co., Ltd. to build a sustainable agricultural model and solve issues faced in agriculture and fruit and vegetable logistics Procurement Trunk transportation Increasing delivery volume and building a logistics and produc
Slide 15: Reinforcing Management Base for Achieving Growth Strategies
Reinforcing Management Base for Achieving Growth Strategies © AIR WATER INC. | 15
Slide 16: Research and Development (Themes)
Research and Development (Themes) Digital & Industry Energy solutions Global and engineering Agriculture & Foods Health & Safety Plant technologies Decarbonized energy Smart agriculture Semiconductor materials Medical equipment Plant and Green innovation equipment Agriculture and food products busin
Slide 17: Research and Development (Innovation)
Research and Development (Innovation) International Advanced Medical Center in Kobe Air Water Kento in Osaka Combining people, knowledge and technologies to innovate Air Water Forest in Hokkaido Nature’s Blessing Farm Scheduled for opening in Matsumoto in December 2024 © AIR WATER INC. | 17
Slide 18: Initiative to Support Focus Areas: DX of Logistics
Initiative to Support Focus Areas: DX of Logistics 1) Transformation into a logistics business 2) Contribution to the Group's logistics functions ◆ A logistics network linking logistics centers has been completed. ◆ The Group's logistics costs have been decreasing steadily. • Increasing the frequenc
Slide 19: Investments in Human Capital
Investments in Human Capital Investments in human capital for having each one employee change and evolve themselves toward business growth Human resources Engagement © AIR WATER INC. | 19
Slide 20: AI・DX
AI・ＤＸ The evolution of management and the promotion of AI and DX Improvement of business Use of AI efficiency DX for DX for operation business Marketing DX for DX Promoting management data-driven management © AIR WATER INC. | 20
Slide 21: New initiative: A part of the DX of marketing
AI・ＤＸ New initiative: A part of the DX of marketing An app with 5 million membership users Increased Key points Questionnaire recognition Enhancement of brand BtoC business × Annual growth rate of Popular with women and 50% young people Acquisition Advertising of new Questionnaire members/sales © AI
Slide 22: Social Contribution Activities
Social Contribution Activities Taking advantage of our community-centered business base, we proactively promote initiatives to help solve local issues, support sports and promote the arts while building cooperative structures including collaboration with each local government. Established a donation
Slide 23: Essential Company
In Closing Essential Company Air Water, which is essential for society © AIR WATER INC. | 23
Slide 24: Today's Agenda
Today’s Agenda 1 Management policy and overall strategy 2 Strategies in focus areas 3 Questions and answers © AIR WATER INC. | 24
Slide 25: Carbon Neutrality
% —~ ee Carbon Neutrality
Slide 26: Our Approach to Initiatives to Promote Carbon Neutrality
Our Approach to Initiatives to Promote Carbon Neutrality © AIR WATER INC. | 26
Slide 27: Our Approach to Initiatives to Promote Carbon Neutrality (Responsibility)
Our Approach to Initiatives to Promote Carbon Neutrality (Responsibility) © AIR WATER INC. | 27
Slide 28: Products Which Contribute to Carbon Neutrality (Contribution)
Products Which Contribute to Carbon Neutrality (Contribution) Scope Areas Businesses and products Product image ⚫ Renewable energy Biomethane, biodiesel ⚫ Equipment powered by alternative fuels V-Satellite, a compact LNG satellite facility ⚫ Chemical products Maximol, an urethane raw material ⚫ Exha
Slide 29: Development of Technologies Which Contribute to Carbon Neutrality
Development of Technologies Which Contribute to Carbon Neutrality (Contribution) Waste generated by local industry Air Water's technologies Timber from Power Utilize local businesses Food residue Gasification forest thinning generation Livestock and distribution networks CO₂ capture manure Recycling
Slide 30: Digital and Semiconductor
Digital and Semiconductor 30
Slide 31: Stable Supply of High-Purity Gases to Semiconductor Plants
Stable Supply of High-Purity Gases to Semiconductor Plants (Our Strengths (1)) New construction/expansion of large-scale semiconductor plants （Industry trends） （Initiative） ⚫ Manufacturing plants for the mass production ⚫ Aggressive capital investment in of advanced logic semiconductors are located
Slide 32: Supporting Semiconductor Manufacturing (Our Strengths (2))
Supporting Semiconductor Manufacturing (Our Strengths (2)) Gases, chemicals, Equipment and Services and materials engineering Semiconductor plant Materials management Bulk gases service Chemicals and Resource recycling materials Special chemicals/special Logistics gases Comprehensive Special gas/spe
Slide 33: Tapping into the Growth of the Semiconductor Market
Tapping into the Growth of the Semiconductor Market Leveraging the Group’s Comprehensive Strengths Products and services for semiconductor plants and business model ⚫ In addition to the supply of gases, chemicals, and materials, the fields of equipment and engineering and services also contribute to
Slide 34: Overseas
Overseas 34
Slide 35: Approach to Overseas Expansion
Approach to Overseas Expansion ⚫ The overseas expansion of Air Water is a part of its efforts to strengthen the field of industrial gases and pursue its growth potential. ⚫ Expanding in India (since 2013), where the market is expected to grow, and in the United States (since 2016), where there is gr
Slide 36: Approach to Overseas Expansion (Our Strengths)
Approach to Overseas Expansion (Our Strengths) Transport Create Use Store Target Semi- conductors ■Plant engineering ■ Liquid hydrogen tanks and trailers ■Medical/food freezers Large, medium-sized, and small Mobile hydrogen stations Refrigerated storage cryogenic air separation plants containers for
Slide 37: India (Business Strategies)
India (Business Strategies) “Building a manufacturing and supply infrastructure network” and “receiving new orders for the onsite supply of gas to steel plants” as an integrated pair of initiatives Map of Air Water India's bases Onsite plants for steel plants Liquefied gas manufacturing plants, Durg
Slide 38: North America (Business Strategies)
North America (Business Strategies) “Developing the carbon neutrality business” and further accelerating “the growth of the industrial gas and engineering business” and ”the low-temperature equipment business” Noble Gas Solutions （Industrial gas sales） Industrial gas manufacturing plant (Scheduled t
Slide 39: Today's Agenda
Today’s Agenda 1 Management policy and overall strategy 2 Strategies in focus areas 3 Questions and answers © AIR WATER INC. | 39
Slide 40: Important points
Important points The target figures and forecasts mentioned in these materials are determinations made by the Company based on currently available information, and include potential risks and uncertainties.For this reason, please be aware that actual results may differ substantially from these forec