TDK Corporation · TSE:6762

TDK — FY March 2014 Earnings Presentation

41 slides from TDK's earnings presentation, Apr 28, 2014

  1. Slide 1: Performance Briefing Fiscal Year March, 2014

    Performance Briefing Fiscal Year March, 2014 TDK Corporation April 28, 2014 Copyright© 2014 TDK Corporation. All rights reserved. Performance Briefing Fiscal Year March, 2014 April 28, 2014 -1-

  2. Slide 2: Consolidated Results and Projections Agenda

    ◆Consolidated Results for FY March 2014 Takakazu Momozuka, Corporate Officer ◆Consolidated Full Year Projections for FY March 2015 Takehiro Kamigama, President and CEO Copyright© 2014 TDK Corporation. All rights reserved. Performance Briefing Fiscal Year March, 2014 April 28, 2014 -2-

  3. Slide 3: Consolidated Full Year Results for FY March 2014

    Consolidated Full Year Results for FY March 2014 Takakazu Momozuka Corporate Officer Copyright© 2014 TDK Corporation. All rights reserved. Performance Briefing Fiscal Year March, 2014 April 28, 2014 -3-

  4. Slide 4: Consolidated Full Year Results for FY March 2014

    Consolidated Full Year Results for FY March 2014 FY March 2013 FY March 2014 Change Full Year Results Full Year Results (Yen billions） (2012.4.1-2013.3.31) (2013.4.1-2014.3.31) Yen billions % Net Sales 841.8 984.5 142.7 17.0 Operating Income 22.1 36.6 14.5 65.6 Operating Income Margin 2.6% 3.7% +1.1

  5. Slide 5: FY March 2014 Results - Passive Components Segment

    FY March 2014 Results - Passive Components Segment Net Sales 471.7 billion yen (up 24% year on year) Net Sales (Yen billions) 472 Operating Income 15.4 billion yen 382 380 (compared with 11.1 billion yen operating loss in FY March 2013) ◆Ceramic Capacitors Consistently profitable since 1Q after impl

  6. Slide 6: FY March 2014 Results - Magnetic Application Segment

    FY March 2014 Results - Magnetic Application Segment Net Sales 364 Net Sales 364.3 billion yen (up 8% year on year) (Yen billions) 316 338 Operating income 28.1 billion yen (down 24% year on year) ◆Recording Devices (HDD Heads) Earnings decreased slightly due to the benefits of improved productivity

  7. Slide 7: FY March 2014 Results - Film Application Segment

    FY March 2014 Results - Film Application Segment Net Sales 129.3 Net sales 129.3 billion yen (up 26% year on year) (Yen billions) Operating income 13.4 billion yen (up 5% year on year) 102.9 80.7 ◆Energy Devices (Rechargeable Batteries) Substantial increases in sales and earnings year on year atop o

  8. Slide 8: Results by Segment

    FY March 2014 results by Segment FY March 2013 FY March 2014 Change Full Year Results Full Year Results Yen billion ％ Yen billion ％ Yen billion % Capacitors 118.0 14.0 139.6 14.2 21.6 18.3 Inductive devices 119.6 14.2 140.3 14.3 20.7 17.3 Other Passive Components 142.1 16.9 191.7 19.5 49.6 34.9 Pass

  9. Slide 9: Breakdown of Operating Income Changes

    Breakdown of Operating Income Changes FY March 2013 Operating Income +14.5 billion yen FY March 2014 22.1 billion yen 36.6 billion yen (Yen billions) Benefits from Proceed from Restructuring insurance +5.9 of Thai flooding Rationalization, -6.7 cost reduction +17.1 SG&A expenses Changes in sales Sal

  10. Slide 10: Quarterly Results by Segment

    Quarterly Results by Segment YoY Change QoQ Change 4Q of FY March 2013 3Q of FY March 2014 4Q of FY March 2014 (C)-(A) (C)-(B) Jan.1- Mar.31, 2013 Oct.1- Dec.31, 2013 Jan.1- Mar.31, 2014 (Yen billions) (A) (B) (C) Yen billions % Yen billions % Capacitors 30.7 34.7 36.1 5.4 17.6 1.4 4.0 Inductive Dev

  11. Slide 11: Financial Position

    Financial Position Change (Yen billions) March End, 2012 March End, 2013 March End, 2014 2013-2014 Total Assets 1,072.8 1,169.6 1,239.6 70.0 Total Liabilities 560.8 589.0 587.3 (1.7) Stockholder’s equity 498.2 561.2 635.3 74.1 (comprehensive income) (230.8) (159.0) (87.1) 71.9 Stockholder’s equity r

  12. Slide 12: Free Cash Flow

    Free Cash Flow (Yen billions) Operating cash flow Investment cash flow Free cash flow 150 127.3 108.9 100 71.9 55.3 50 25.4 18.7 0 -50 -29.9 -55.4 -100 -90.2 （Yen billions） FY March 2013 FY March 2014 Change Capital Expenditures 85.6 68.6 (17.0) Depreciation and amortization 77.4 82.9 5.5 Copyright©

  13. Slide 13: Recording Device Business

    Recording Device Business ●HDD market FY March 2014 : About 552 million units (TDK’s estimation） FY March 2015 : About 535 million units (TDK’s forecast) ●Shipment index Recording Device Sales (Left, including HDD Head (HGA) and HDD Suspention) HDD Head Shipment Index (Right) (Yen billions) 66.3 69.

  14. Slide 14: Restructuring Progress

    Restructuring Progress ■Restructuring implemented during FY March 2014 ◇Exit non-core businesses Promote business ・Withdraw from LTO business and Blu- portfolio review ray business ・Review of other business and products Optimize ◇Further integrate bases worldwide production bases (Centered on overse

  15. Slide 15: Consolidated Full Year Projections for FY March 2015

    Consolidated Full Year of Projections for FY March 2015 Takehiro Kamigama President and CEO Copyright© 2014 TDK Corporation. All rights reserved. Performance Briefing Fiscal Year March, 2014 April 28, 2014 - 15 -

  16. Slide 16: FY March 2015 Full Year / Dividend Projections

    FY March 2015 Full Year / Dividend Projections FY March 2014 FY March 2015 Y o Y Change Full Year Results Full Year Projections Yen billions % (Yen billions） Net Sales 984.5 1,050.0 65.5 6.7% Operating Income 36.6 57.0 20.4 55.7% Operating Income Margin 3.7% 5.4% +1.7pt - Income from continuing oper

  17. Slide 17: Projections for FY March 2015 - Image of change in sales

    Projections for FY March 2015 -Image of change in sales FY March 2015 Segment FY March 2014 Projections Main factor and premise of projections (YoY Change) Passive Components 471.7 +10～+15% Increase in sales of various products for the ICT market and the automobile market Magnetic Application 364.3

  18. Slide 18: Priority Three Markets and Priority Five Businesses

    Priority Three Markets and Priority Five Businesses Automobile Priority Five Businesses ・Inductive Devices ・High Frequency Components ・Piezoelectric Material Products ・HDD Heads ・Rechargeable Batteries Industrial ICT equipment / Energy Copyright© 2014 TDK Corporation. All rights reserved. Performanc

  19. Slide 19: Automobile market

    Automobile market Expand the sales ratio of automotive applications to 20% on a Company-wide basis ・To strengthen components used in power train system of environmentally friendly vehicles (electric vehicles (EVs), hybrid electric vehicles (HEVs) and plug-in hybrid electric vehicles (PHEVs)) ・To int

  20. Slide 20: ICT market

    ICT market Double-digit Market Growth in the Smartphone Expanding TDK’s Business Opportunities in the and Tablet markets Greater use of Electronic Components ICT Market through Technological Innovation Advanced camera module functions Smartphones →Higher demand for Voice Coil Motor (VCM) (million un

  21. Slide 21: ICT market - High Frequency components business

    ICT market - High Frequency components business Target markets & strategies IC Reference Strengthen “through” business process: Design promotion→Gain qualification→Win orders Design Module & Discrete Discrete Solution Module Solution Solution FEMiD Diversity module Discrete items for PAD SAW TC-SAW

  22. Slide 22: Industrial Equipment Market / Energy market

    Industrial Equipment Market / Energy market HEMS Power management-related products using magnetic technology, TDK’s core competence 6MW Windmill 128 rotors . Magnet usage： 5 2 ton/unit 813g magnets 50pcs Pole Rotor Generator 22 Focus products in this fields Power components Bidirectional DC/DC Metal

  23. Slide 23: Sales Growth Projections by Priority Markets

    Sales Growth Projections by Priority Markets (Yen billions) Industrial & Others 250 (Yen billions) 200 +7% 150 +6% 1,200 100 50 1,000 0 FY13/3 FY14/3 FY15/3 800 CAGR 9% (Yen billions) ICT 600 800 600 400 400 +8% 200 200 CAGR 3% 0 0 FY13/3 FY14/3 FY15/3 FY13/3 FY14/3 FY15/3 (Yen billions) Automotive

  24. Slide 24: Initiatives for Five Priority Businesses

    Initiatives for Five Priority Businesses Five Priority Main initiatives Businesses Increase sales for strategic products to the automobile market Inductive Devices (Multilayer, Wire-wound) Increase share of metal coil(Thin-film, Wire-would, Multilayer) Increase sales of discrete products by performa

  25. Slide 25: Initiatives for improving profitability: Magnet, Power Supply

    Initiatives for improving profitability Magnet － Benefit from productivity improvements through consolidation of ferrite magnet bases and integrated production lines － Expand sales of ferrite magnets for automotive applications and home appliances －Focus on expanding sales of metal magnets in fields

  26. Slide 26: Shift to balanced profit structure by focusing on priority five businesses

    Initiatives for improving profitability Shift to balanced profit structure by focusing on priority five businesses FY13/3 FY14/3 FY15/3 Passive Components Magnetic Application Products Film Application Products FY13/3 : FY March 2013 Copyright© 2014 TDK Corporation. All rights reserved. Performance

  27. Slide 27: Research & Development Topics

    Research & Development Topics Copyright© 2014 TDK Corporation. All rights reserved. Performance Briefing Fiscal Year March, 2014 April 28, 2014 - 27 -

  28. Slide 28: R&D topics - MR Sensor

    R&D topics - MR Sensor Various magnetic sensors using magnetic technology, TDK’s core competence, and sophisticated TMR Technology accumulated in HDD Heads business GMR Encoder TMR Gear Tooth Sensor TMR Angle Sensor (Analog / Digital) Copyright© 2014 TDK Corporation. All rights reserved. Performance

  29. Slide 29: R&D topics - SESUB (Semiconductor Embedded Substrate)

    R&D topics - SESUB (Semiconductor Embedded Substrate) In addition to the ICT field, SESUB will be integrated with other TDK technologies and utilized for applications in the healthcare and energy fields Connectivity Module for wireless application Power Management Unit for power application POL Conv

  30. Slide 30: R&D topics - SESUB modules fit in a 10 yen coin

    R&D topics - SESUB (Semiconductor Embedded Substrate) 12 modules fit in an area the size of a 10 yen coin 23.5mm Bluetooth module (mass production started in February 2014) Thickness：1.5mm Discrete IC 5.6mm 8.5mm 6.0x6.0x0.8mm QFN40 The SESUB module’s greatest advantage is that it is smaller than tr

  31. Slide 31: Supplementary Data

    Supplementary Data Copyright© 2014 TDK Corporation. All rights reserved. Performance Briefing Fiscal Year March, 2014 April 28, 2014 - 31 -

  32. Slide 32: Quarterly sales and operating income by segment

    Quarterly sales and operating income by segment FY March 2013 FY March 2014 Yen billions 1Q 2Q 3Q 4Q Total 1Q 2Q 3Q 4Q Total Capacitors 31.4 29.2 26.6 30.7 118.0 33.7 35.1 34.7 36.1 139.6 Inductive Devices 28.2 29.6 30.6 31.2 119.6 35.0 35.5 34.9 34.9 140.3 Other Passive Components 31.8 31.7 36.0 42

  33. Slide 33: FY March 2015 Projections - Capex, Depreciation, R&D

    FY March 2015 Projections -Capex, Depreciation, R&D- Capital expenditure Depreciation R&D (Yen billions) 120 99.7 100 85.6 82.9 83.0 78.6 80.0 77.3 79.9 77.4 80 68.6 68.0 63.4 60 52.6 52.6 53.5 40 20 0 11/3 12/3 13/3 14/3 15/3 11/3 12/3 13/3 14/3 15/3 11/3 12/3 13/3 14/3 15/3 Projections Projections

  34. Slide 34: Annual Sales by applications (FY March 2010 – FY March 2014)

    Annual Sales by applications (FY March 2010 – FY March 2014) FY10/3 : FY March 2010 Copyright© 2014 TDK Corporation. All rights reserved. Performance Briefing Fiscal Year March, 2014 April 28, 2014 - 34 -

  35. Slide 35: Passive Components Business Annual sales by applications

    Passive Components Business Annual sales by applications (FY March 2010 – FY March 2014) FY10/3 : FY March 2010 Copyright© 2014 TDK Corporation. All rights reserved. Performance Briefing Fiscal Year March, 2014 April 28, 2014 - 35 -

  36. Slide 36: Quarterly sales by applications

    Quarterly sales by applications (1Q of FY March 2013 –4Q of FY March 2014) Copyright© 2014 TDK Corporation. All rights reserved. Performance Briefing Fiscal Year March, 2014 April 28, 2014 - 36 -

  37. Slide 37: Passive Components Business quarterly sales by applications

    Passive Components Business quarterly sales by applications (1Q of FY March 2013 –4Q of FY March 2014) Copyright© 2014 TDK Corporation. All rights reserved. Performance Briefing Fiscal Year March, 2014 April 28, 2014 - 37 -

  38. Slide 38: Copyright © 2014 TDK Corporation. All rights reserved. Performance Briefing Fiscal Year March, 2014

    2005/3 : FY March 2005 Copyright© 2014 TDK Corporation. All rights reserved. Performance Briefing Fiscal Year March, 2014 April 28, 2014 - 38 -

  39. Slide 39: Copyright © 2014 TDK Corporation. All rights reserved. Performance Briefing Fiscal Year March, 2014

    2005/3 : FY March 2005 Copyright© 2014 TDK Corporation. All rights reserved. Performance Briefing Fiscal Year March, 2014 April 28, 2014 - 39 -

  40. Slide 40: Cautionary Statements with Respect to Forward-Looking Statements

    Cautionary Statements with Respect to Forward-Looking Statements This material contains forward-looking statements, including projections, plans, policies, management strategies, targets, schedules, understandings, and evaluations about TDK, or its group companies (TDK Group). These forward-looking

  41. Slide 41: Text data including Q&A will be uploaded

    Text data including Q&A of performance briefing will be uploaded on following site http://www.global.tdk.com/ir/ir_events/conference/2014/4q_1.htm

TDK — FY March 2014 Earnings Presentation on 6ix