Kanadevia Corporation · TSE:7004

Kanadevia — Hitachi Zosen — Q2 FY2021 Earnings Presentation

46 slides from Kanadevia's earnings presentation, Nov 2, 2021

  1. Slide 1: Financial Results for Second Quarter FY2021

    Financial Results for Second Quarter FY2021 November 2nd, 2021 Hitachi Zosen Corporation © 2021 Hitachi Zosen Corp.

  2. Slide 2: Contents

    Contents Contents Financial Information • Overview of 2Q FY2021 Consolidated Financial Results • Forecast of FY2021 • Details by Segments Management and Business Information • Progress of Medium-Term Management Plan “Forward 22” • Major Order Intake in First Half of FY2021 • Major Projects Overview

  3. Slide 3: Financial Information

    Financial Information Director, General Manager of Corporate Planning HQ Michi Kuwahara © 2021 Hitachi Zosen Corp. 3

  4. Slide 4: Highest first half order intake and sales in 10 years

    Key Point of 2Q FY2021 Results Highest first half order intake and sales in 10 years © 2021 Hitachi Zosen Corp. 4

  5. Slide 5: FY2021 2Q Results - Overview

    FY2021 2Q Results - Overview (Billions of JPY) FY2020-2Q FY2021-2Q Difference (a) (b) (b)-(a) Order intake 221.2 380.6 159.4 Net sales 166.8 180.4 13.6 Operating -1.3 -1.4 -0.1 income (Ratio to Net sales) (- 0.8%) (- 0.8%) Ordinary -2.4 -2.8 -0.4 income (Ratio to Net sales) (- 1.4%) (- 1.6%) (Extrao

  6. Slide 6: FY2021 2Q Results – Order intake

    FY2021 2Q Results – Order intake (Billions of JPY) FY2020-2Q FY2021-2Q Difference (a) (b) (b)-(a) Environment 166.3 319.8 153.5 Machinery and 50.7 56.8 6.1 Infrastructure Others 4.2 4.0 -0.2 Total 221.2 380.6 159.4 © 2021 Hitachi Zosen Corp. 6

  7. Slide 7: FY2021 2Q Results – Order backlog

    FY2021 2Q Results – Order backlog (Billions of JPY) End of Mar. End of Sep. Difference End of Mar. End of Sep. 2021 2021 (b)-(a) 2020 2020 (a) (b) Environment 598.5 661.7 637.5 844.9 207.4 of which, long- 286.3 304.2 298.6 409.4 110.8 term operation Machinery and 140.7 134.8 126.7 122.9 -3.8 Infrast

  8. Slide 8: FY2021 2Q Results – Net sales

    FY2021 2Q Results – Net sales (Billions of JPY) FY2020-2Q FY2021-2Q Difference (a) (b) (b)-(a) Environment 106.3 123.5 17.2 Machinery and 56.4 52.9 -3.5 Infrastructure Others 4.1 4.0 -0.1 Total 166.8 180.4 13.6 © 2021 Hitachi Zosen Corp. 8

  9. Slide 9: FY2021 2Q Results – Operating income

    FY2021 2Q Results – Operating income (Billions of JPY) FY2020-2Q FY2021-2Q Difference (a) (b) (b)-(a) Environment -1.3 -0.7 0.6 Machinery and 0.0 -0.9 -0.9 Infrastructure Others 0.0 0.2 0.2 Total -1.3 -1.4 -0.1 © 2021 Hitachi Zosen Corp. 9

  10. Slide 10: FY2021 2Q Results – Breakdown of changes in Operating income

    FY2021 2Q Results – Breakdown of changes in Operating income (Billions of JPY) FY2020-2Q Operating income - 1.3 ・Improvement in Inova Group +2.2 ・Decrease in highly profitable projects - 1.5 Breakdown of (Water business, retrofit works) changes in Operating ・Decrease in profit in Press Machine - 0.1

  11. Slide 11: FY2021 2Q Results – Balance Sheet

    FY2021 2Q Results – Balance Sheet (Billions of JPY) End of End of Difference Mar. 2020 Sep. 2021 (a) (b) (b)-(a) Cash and deposits 47.3 67.2 19.9 Operating assets 193.2 147.0 - 46.2 Trade notes and accounts receivable 169.3 127.9 - 41.4 Inventories 23.9 19.1 - 4.8 Tangible & intangible fixed assets

  12. Slide 12: FY2021 2Q Results – Cash flows and Interest-bearing debt

    FY2021 2Q Results – Cash flows and Interest-bearing debt Cash flows (Billions of JPY) FY2020-2Q FY2021-2Q Difference (a) (b) (b)-(a) Cash flows from operating activities 12.4 38.6 26.2 Cash flows from investing activities - 5.6 - 0.8 4.8 Cash flows from financing activities - 9.5 - 18.0 - 8.5 Increa

  13. Slide 13: Forecast of FY2021

    Forecast of FY2021 © 2021 Hitachi Zosen Corp. 13

  14. Slide 14: FY2021 Forecast – Overview

    FY2021 Forecast – Overview (Billions of JPY) FY2020 FY2021 Difference Forecast Forecast Results as of May as of Nov. （a） （b） （c） （c）-（a） （c）-（b） Order intake 429.4 450.0 580.0 150.6 130.0 Net sales 408.5 400.0 400.0 -8.5 0.0 Operating 15.3 14.0 14.0 -1.3 0.0 income (Ratio to Net sales) (3.8%) (3.5%)

  15. Slide 15: FY2021 Forecast – Order intake

    FY2021 Forecast – Order intake (Billions of JPY) FY2020 FY2021 Difference Forecast Forecast Results as of May as of Nov. （a） （b） （c） (c)-(a) (c)-(b) Environment 303.7 315.0 445.0 141.3 130.0 Machinery and 117.3 125.0 125.0 7.7 0.0 Infrastructure Others 8.4 10.0 10.0 1.6 0.0 Total 429.4 450.0 580.0 1

  16. Slide 16: FY2021 Forecast – Net sales

    FY2021 Forecast – Net sales (Billions of JPY) FY2020 FY2021 Difference Forecast Forecast Results as of May as of Nov. （a） （b） （c） (c)-(a) (c)-(b) Environment 269.4 265.0 265.0 -4.4 0.0 Machinery and 130.8 125.0 125.0 -5.8 0.0 Infrastructure Others 8.3 10.0 10.0 1.7 0.0 Total 408.5 400.0 400.0 -8.5 0

  17. Slide 17: FY2021 Forecast – Operating income

    FY2021 Forecast – Operating income (Billions of JPY) FY2020 FY2021 Difference Forecast Forecast Results as of May as of Nov. （a） （b） （c） (c)-(a) (c)-(b) Environment 12.6 13.0 13.0 0.4 0.0 Machinery and 2.6 1.0 1.0 -1.6 0.0 Infrastructure Others 0.1 0.0 0.0 -0.1 0.0 Total 15.3 14.0 14.0 -1.3 0.0 © 20

  18. Slide 18: Financial information

    Financial information (Billions of JPY) FY2018 FY2019 FY2020 FY2021 Results Results Results Plan Total assets 429.0 409.5 429.3 430.0 Cash and deposits 35.6 42.9 47.3 48.0 Equity 119.5 118.0 126.4 130.0 Equity ratio 27.8% 28.8% 29.4% 30.0% ROE 4.6% 1.9% 3.5% 3.9% Interest-bearing debt 126.3 99.6 98.

  19. Slide 19: Details by Segments

    Details by Segments © 2021 Hitachi Zosen Corp. 19

  20. Slide 20: Environment

    Environment 445.0 (Billions of JPY) 【Order intake】 Inova Group 319.8 315.0 Order intake 303.7 275.0 ■2Q Results（vs. FY2020 2Q） 104.9 140.0 319.8 (+153.5) 166.3 235.2 ・ Order intake in Dubai (EPC, O&M), UK (EPC) 35.5 198.8 175.0 170.0 130.8 84.6 ■FY2021 Forecast (vs. as of May) 2Q Year 2Q Forecast Fo

  21. Slide 21: Machinery and Infrastructure

    Machinery and Infrastructure (Billions of JPY) 【Order intake】 Infrastructure Machinery Order intake 117.3 125.0 ■2Q Results（vs.FY2020 ２Q） 32.0 56.8 (+6.1) 27.8 Increase in marine diesel engine, press machine and precision ・ 50.7 56.8 machinery 10.9 9.8 93.0 ■FY2021 Forecast (vs. as of May) 89.5 40.9

  22. Slide 22: Management and Business Information

    Management and Business Information President and COO Sadao Mino © 2021 Hitachi Zosen Corp. 22

  23. Slide 23: Medium-Term Management Plan

    Medium-Term Management Plan © 2021 Hitachi Zosen Corp. 23

  24. Slide 24: Progress of Medium-Term Management Plan "Forward22"

    Progress of Medium-Term Management Plan "Forward22" Contribute to the realization of sustainable and safe & secure society through overall corporate activities. Aim to be corporate group capable of sustainable growth by strengthening profitability. Basic Policy and Initiatives Progress Increase the

  25. Slide 25: First Half Results and Status of Each Business

    First Half Results and Status of Each Business © 2021 Hitachi Zosen Corp. 25

  26. Slide 26: Orders Received (Japan)

    Orders Received (Japan) Order Capacity, Schedule, Project/Order Outline received etc. delivery Methanation Installed in Tokyo Gas's Yokohama April Received order for methanation 12.5Nm3/h Feb. 2022 Techno Station. equipment from Tokyo Gas Demonstration to begin in 2021. Water business Contract award

  27. Slide 27: Orders Received (Global)

    Orders Received (Global) Order Schedule, Project/Order Outline Capacity, etc. received delivery Water treatment：Osmoflo Scope：Water filtration and treatment equipment for water from rivers,、 May Water treatment plants in Iraq 12,500m3/day Aug. 2022 RO water treatment plants, etc. Customer：JGC Energy

  28. Slide 28: Environment Business - Major Projects

    Environment Business - Major Projects Execution O&M Calender year Place (Country) Order completion Formation Scope 2018 2019 2020 2021 2022 2023 2024 Shiga Mar.2017 Mar.2023※ JV DBO Shiga Mar.2017 Jun,2022 JV DBO Gunma Jun.2018 Jan.2025 Solo EPC Hokkaido Nov.2019 Jul.2024 JV EPC Japan Chiba Feb.2020

  29. Slide 29: Hitachi Zosen Inova - Major Projects

    Hitachi Zosen Inova - Major Projects Execution O&M Calendar year Project (country) Order Completion Formation Inova's Scope 2018 2019 2020 2021 2022 2023 2024 Istanbul(Turkey) Sep.2017 Oct.2021 JV EP+O&M(1-year) Ivery(France) Nov.2018 2021 Sole EP+SV Rookery(UK) Mar.2019 Feb.2022 Sole EPC Moscow1-4(

  30. Slide 30: Inova First half results and medium- to long-term initiatives

    Inova First half results and medium- to long-term initiatives Major results for the first half of 2021 2 EfW orders UAE（Dubai）▶ Long-term O&M contract also awarded 1H order intake JPY235.2bn U.K.（Skelton Grange）▶ 15th order in UK and Ireland Istanbul Project Completion in Oct. 2021 (Under customer’s

  31. Slide 31: Inova First Half Results and Medium- to Long-Term Initiatives

    Inova First Half Results and Medium- to Long-Term Initiatives Medium- to Long-Term Initiatives Synergies with Hitachi Standardization of specifications for major equipment, cooperation in Zosen procurement, and collaboration in Dubai (UAE) New markets outside EU Turkey（2017） Russia（2019） Australia（2

  32. Slide 32: Update of Business: Environment Business

    Update of Business Environment Business（Hitachi Zosen, group companies other than Inova） ■Energy from waste（EPC） ■Electricity sales • Japan：Orders in the market is about 30% less than • Electricity wholesaling contracts with new sales the previous year. Next year will be back to the same partners le

  33. Slide 33: Update of Business: Machinery & Infrastructure Business

    Update of Business Machinery & Infrastructure Business ■Marine Diesel Engine ■Press Machine • Orders in the shipbuilding industry high, • While business negotiations are gradually increasing, but engine prices remain tough full recovery in orders will take time. • Strengthen after-sales service busi

  34. Slide 34: Update of Business: Machinery & Infrastructure Business

    Update of Business Machinery & Infrastructure Business ■Process Equipment ■Steel Structure & Disaster Prevention • Declined investment in refining and petrochemicals • Bridge market size is about the same as usual year Movements in petrochemical sector, incl. ammonia • Orders for bridges, sluice gat

  35. Slide 35: Topics

    Topics © 2021 Hitachi Zosen Corp. 35

  36. Slide 36: Topics PtG (Power to Gas) Business

    Topics PtG（Power to Gas）Business Hydrogen production by water electrolysis using renewable power（Yamanashi Pref.） Selected as a NEDO subsidized project (Green Innovation Fund Project) Design and testing of PEM water electrolyzers ■Secretary Yamanashi Prefecture for larger scale and modularization ■P

  37. Slide 37: Topics PtG (Power to Gas) Business

    Topics PtG（Power to Gas）Business Feasibility Study on High-Pressure PEM-type Electrolyzer for Green Ammonia Production and Supply Project in Lao PDR Adopted as a commissioned project by NEDO This study aims to develop and commercialise ■Name of Study: technology to produce green hydrogen from unused

  38. Slide 38: Topics Use of AI, IoT

    Topics Use of AI, IoT Completion of Enery-from-Waste (EfW) Plant in Rayong Province, Thailand “Remote Supervisor” to complete facility construction（July, 2021）, while unable to travel overseas due to the spread of COVID-19 （Outline of Project） Customer： Jurong Engineering Limited（Singapore） Ultimate

  39. Slide 39: Supplementary Information (Breakdown by Small Segments)

    Supplementary Information (Breakdown by Small Segments) © 2021 Hitachi Zosen Corp. 39

  40. Slide 40: Order Intake, Net Sales, Operating Income (2Q Results)

    Order Intake, Net Sales, Operating Income (2Q Results) (Billions of JPY) FY2018 FY2019 FY2020 FY2021 Difference 2Q 2Q 2Q 2Q （a） （b） (b)-(a) Enviroment 123.4 115.4 166.3 319.8 153.5 Machinery & 56.1 79.3 50.7 56.8 6.1 Order Infrastructure intake Other 6.0 5.5 4.2 4.0 - 0.2 Total 185.5 200.2 221.2 380

  41. Slide 41: Order Intake, Net Sales, Operating Income (Full year Results and Forecast)

    Order Intake, Net Sales, Operating Income (Full year Results and Forecast) (Billions of JPY) FY2018 FY2019 FY2020 FY2021 Difference Difference Forecast Forecast Results Results Results as of May as of Nov. (a) (b) (c) (c)-(a) (c)-(b) Enviroment 314.7 289.4 303.7 315.0 445.0 141.3 130.0 Machinery & O

  42. Slide 42: Small Segment: Environment Business (2Q Results)

    Small Segment：Environment Business (2Q Results) FY2018 FY2019 FY2020 FY2021 Difference (Billions of JPY) 2Q 2Q 2Q 2Q （a） （b） (b)-(a) EPC 43.0 54.8 85.5 138.1 52.6 Order intake AOM* 80.4 60.6 80.8 181.7 100.9 Total 123.4 115.4 166.3 319.8 153.5 EPC 42.8 55.1 57.4 72.0 14.6 Net sales AOM* 45.1 51.3 48

  43. Slide 43: Small Segment: Environment Business (Full year Results and Forecast)

    Small Segment：Environment Business (Full year Results and Forecast) FY2018 FY2019 FY2020 FY2021 Difference Difference (Billions of JPY) Forecast Forecast Results Results Results as of May as of Nov. (a) (b) (c) (c)-(a) (c)-(b) EPC 148.5 132.9 168.7 195.0 210.0 41.3 15.0 Order AOM 166.2 156.5 135.0 1

  44. Slide 44: Small Segment: Machinery and Infrastructure Business (2Q Results)

    Small Segment: Machinery and Infrastructure Business (2Q Results) (Billions of JPY) FY2018 FY2019 FY2020 FY2021 Difference 2Q 2Q 2Q 2Q (a) (b) (b)-(a) Marine Diesel Engine 5.2 15.2 10.5 12.5 2.0 Press Machine 13.4 12.9 4.8 7.7 2.9 Process Equipment 4.0 6.9 3.7 2.4 - 1.3 Order intake Precision Machin

  45. Slide 45: Small Segment: Machinery and Infrastructure Business (Full year Results and Forecast)

    Small Segment: Machinery and Infrastructure Business (Full year Results and Forecast) (Billions of JPY) FY2018 FY2019 FY2020 FY2021 Forecast Forecast Difference Difference Results Results Results as of May as of Nov. (a) (b) (c) (c)-(a) (c)-(b) Marine Diesel Engine 21.8 26.7 28.4 19.5 19.5 - 8.9 0.0

  46. Slide 46: https://www.hitachizosen.co.jp/

    （将来に関する記述等についてのご注意） 本資料に記載されている業績予想等の将来に関する記述は、当社が現時点で入手している 情報及び合理的であると判断する一定の前提に基づいており、実際の業績等は様々な要因 により異なる結果となる可能性があります。 https://www.hitachizosen.co.jp/

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