Sekisui Chemical Co., Ltd. · TSE:4204
Sekisui Chemical — Q2 2020 Earnings Presentation
47 slides from Sekisui Chemical's earnings presentation, Oct 29, 2020
Slide 1: Presentation of Financial Results and Progress under Management Plan Q2 FY2020
SEKISUI CHEMICAL CO., LTD. Presentation of Financial Results and Progress under Management Plan for the Second Quarter of Fiscal Year 2020, which ending March 31, 2021 Keita Kato President 29 October, 2020
Slide 2: Results for 1H FY2020 - Forex Rate
Results for 1H FY2020 FY2020 Forex Rate 1H FY2019 1H FY2020 Initial Plan ¥109/US$ ¥109/US$ ¥110/US$ Assumptions ¥124/€ ¥121/€ ¥120/€ Results ¥109/US$ ¥107/US$ (Avg. rate for ‐ each term) ¥121/€ ¥121/€ 1
Slide 3: Overview of 1H FY2020 Results
Overview of 1H FY2020 Results ∎ Substantial decreases in sales as well as each level of profit FY2020 Plan Assumptions (Impact of COVID-19)* due to the significant impact of COVID-19 • Current conditions (mid Apr.) to continue to June; despite a gradual recovery thereafter, significant impact on the
Slide 4: 1H FY2020 Results: Net Sales and Operating Income by Divisional Company
1H FY2020 Results: Net Sales and Operating Income by Divisional Company ∎ Despite decreases in sales and profit in each segment due to the impact of COVID-19, profit exceeded plans on the back of successful efforts to implement measures aimed at reducing costs and structural reforms ahead of schedul
Slide 5: 1Q & 2Q FY2020 Results by Divisional Company
1Q & 2Q FY2020 Results: Net Sales and Operating Income by Divisional Company ∎ After bottoming out in the 1Q across each segment, results in the 2Q exhibited an overall recovery trajectory, albeit at a slightly slow pace 1Q FY2019 1Q FY2020 2Q FY2019 2Q FY2020 Net Operating Net Operating Net Operati
Slide 6: 1H FY2020 Results: Net Sales and Operating Income
1H FY2020 Results: Net Sales and Operating Income ∎ Substantial decrease in sales owing to the significant impact of COVID-19; despite substantial decreases in sales volumes and product mix as well as consolidated-basis change, promoted the reduction of fixed costs ∎ Operating income exceeded plans
Slide 7: FY2020 Revised Annual and 2H Plans
FY2020 Revised Annual and 2H Plans 2H FY2020 FY2020 Forex Rate 2H FY2019 Plan Initial Plan Assumptions ¥108/US$ ¥106/US$ ¥110/US$ ¥120/€ ¥126/€ ¥120/€ Results ¥109/US$ (Avg. rate for ‐ ‐ each term) ¥120/€ 6
Slide 8: Overview of FY2020 Revised Plan
Overview of FY2020 Revised Plan ∎ Despite decreases in sales as well as each level of profit due to the substantial impact of COVID-19, expected to achieve initial plans for each level of profit through the implementation of measures aimed at reducing costs and structural reforms ahead of schedule ∎
Slide 9: FY2020 Revised Plan by Divisional Company
FY2020 Revised Plan: Net Sales and Operating Income by Divisional Company ∎ Despite decreases in both sales and profit in each segment, expected to achieve initial operating income plan (¥70 billion) by taking the initiative in implementing various measures FY2020 FY2020 Plan FY2019 Difference Diffe
Slide 10: Outlook for Market Conditions
Outlook for Market Conditions ∎ In overall terms, recovery from the impact of COVID-19 is expected to be slower than first assumed under the initial plan Number of Automobiles Manufactured (YoY) Housing・Visitors (YoY) While the 2Q exceeded expectations, the pace of recovery projected to be Despite a
Slide 11: 2H FY2020 Revised Plan by Divisional Company
2H FY2020 Revised Plan: Net Sales and Operating Income by Divisional Company ∎ Despite a decrease in sales due to the greater than expected prolonged impact of COVID-19, projecting a turnaround to Groupwide increase profit mainly through successful efforts to reduce costs • HPP: Despite the prolonge
Slide 12: 2H FY2020 Revised Plan: Net Sales and Operating Income
2H FY2020 Revised Plan: Net Sales and Operating Income ∎ While anticipating a greater than expected prolonged impact of COVID-19 and the increase in sales volumes and product mix held to a nominal increase, return to increase profit mainly on the back of successful efforts to reduce costs in excess
Slide 13: High Performance Plastics Company
High Performance Plastics Ikusuke Shimizu Company Company President 12
Slide 14: HPP: Overview of 1H FY2020 Results
HPP Overview of 1H FY2020 Results Company ∎ Despite a substantial decline in both sales and profit due to the impact of COVID-19, exceeded plans in the 1H ∎ While the impact of COVID-19 will linger especially on the Mobility field, return to increased profit by taking the initiative in implementing
Slide 15: HPP: 1H FY2020 Results: Net Sales and Operating Income
HPP 1H FY2020 Results: Net Sales and Operating Income Company ∎ Despite a substantial decline in both sales volumes and product mix mainly in the Mobility and Building and Infrastructure fields as well as SEKISUI AEROSPACE CORPORATION due to the impact of COVID-19, continued improvement from the 1Q
Slide 16: HPP: 2H FY2020 Plan
HPP 2H FY2020 Plan: Net Sales and Operating Income Company ∎ Despite a downward revision of the 2H operating income plan due to a delay in recovering from the impact of COVID-19 (mainly in the Mobility field and SEKISUI AEROSPACE CORPORATION) as well as the impact of movements in foreign currency ex
Slide 17: Three Strategic Fields and Cost Innovations
HPP Three Strategic Fields and Cost Innovations Company ∎ Robust Electronics field; Mobility as well as Building and Infrastructure fields on a recovery trend after bottoming out in the 1Q Net Sales in the Three Strategic Fields Mobility and Progress in FY2020 • Exceeded plans in the 1H on the back
Slide 18: Growth Driver
HPP Growth Driver Company ∎ Even amid the delay in market condition recovery, medium-term growth potential unchanged in each of the three fields; steadily promote growth measures Progress of Growth Measures in the Three Fields Mobility Building and Infrastructure Electronics 〜 High-performance inter
Slide 19: Housing Company
Toshiyuki Kamiyoshi Housing Company Company President 18
Slide 20: Housing: Overview of 1H FY2020 Results
Overview of 1H FY2020 Results Housing Company ∎ Operating income exceeded plans in the 1H; secured 2H-start backlog thanks largely to new housing orders exceeding plans • While impacted by COVID-19 in the 1Q, new housing orders return to around the previous year’s level in the 2Q • While renovation
Slide 21: Housing: 1H FY2020 Results
Housing 1H FY2020 Results: Net Sales and Operating Income Company ∎ Despite a substantial decline in sales due to COVID-19 (including a drop in 1Q orders and delays in construction), progress in reducing costs and fortifying the business structure • Housing: Offset the substantial decline in the num
Slide 22: Housing: 2H FY2020 Revised Plan
Housing 2H FY2020 Revised Plan: Net Sales and Operating Income Company ∎ Decline in the number of houses sold offset by successful efforts to reduce costs and fortify the business structure; work to secure operating income at essentially the same level recorded in the previous year • Housing: Despit
Slide 23: New Housing Orders
New Housing Orders Housing Company ∎ Secure 2H orders at the same level as the previous year by implementing three key measures aimed at generating growth (sales force, product strategies, and land strategies) Customer and Order Trends *%: YoY 2H Housing Order Plan *%: YoY Visitors Results / Forecas
Slide 24: Business for Heim owners, Town and Community Development
Business for Heim owners (Renovation, Real Estate), Housing Town and Community Development Company ∎ Target a 2H YoY increase in Renovation Business orders; in addition to firm trends in the real estate rental and brokerage services businesses, strengthen renovation collaboration Business for Heim O
Slide 25: Urban Infrastructure and Environmental Products Company
Urban Infrastructure and Yoshiyuki Hirai Environmental Products Company Company President 24
Slide 26: UIEP: Overview of 1H FY2020 Results
UIEP Overview of 1H FY2020 Results Company ∎ While profit decreased substantially in the 1H due to the impact of COVID-19 (stoppages in domestic construction, overseas lockdowns, and slowdown in aircraft sheet demand), exceeded plans (Jul. 2020) on the back of successful efforts to reduce costs and
Slide 27: UIEP: 1H FY2020 Results
UIEP 1H FY2020 Results: Net Sales and Operating Income Company ∎ While sales volumes and the product mix decreased substantially due to the significant impact of COVID-19, exceeded plans (Jul. 2020) on the back of successful efforts to reduce costs • Japan: Despite firm civil engineering demand, sub
Slide 28: UIEP: 2H FY2020 Revised Plan
UIEP 2H FY2020 Revised Plan: Net Sales and Operating Income Company ∎ Amid a slower than anticipated recovery in demand, return to an increase in profit mainly through reductions in costs • Japan: Substantial prioritized product growth (2H net sales plan: +20%*) * YOY • Japan: Work to realize the ef
Slide 29: Three Strategic Fields and Structural Reforms
UIEP Three Strategic Fields and Structural Reforms Company ∎ Promoting further improvements in profitability through a shift to high-value-added products and structural reforms in each field Net Sales in the Three Strategic Fields Advanced Materials (Billions of yen) Piping and Infrastructure (Billi
Slide 30: Growth Strategy (Prioritized Products, Overseas)
UIEP Growth Strategy (Prioritized Products, Overseas) Company Expansion in Prioritized Products Product Example Prioritized Products Sales (Billions of yen) (1) ESLO (3) High Flowrate (2) SPR-SE (4) SEW HYPER AWHP Drainage System • While sales declined increase in the ratio of prioritized product sa
Slide 31: Medical Business
Futoshi Kamiwaki Medical Business Director Senior Managing Executive Officer Head of Business Strategy Department 30
Slide 32: Medical: Overview of 1H FY2020 Results
Medical Overview of 1H FY2020 Results Business ∎ Significant impact of COVID-19 mainly on the number of outpatient tests, substantial decline in profit in the 1H ∎ Despite the forecast of a greater than anticipated prolonged impact from COVID-19, plans for return to increased profit owing to a certa
Slide 33: Medical: 1H FY2020 Results
1H FY2020 Results: Net Sales and Operating Income Medical Business ∎ Despite the greater than anticipated prolonged impact of COVID-19 (mainly on the Diagnostics Business), achieved operating income in excess of plans (Jul. 2020) on the back of successful efforts to reduce costs ∎ Steady progress in
Slide 34: Medical: 2H FY2020 Revised Plan
Medical 2H FY2020 Revised Plan: Net Sales and Operating Income Business ∎ Despite a greater than anticipated prolonged impact of COVID-19, target an increase in profit backed by a certain degree of demand recovery in the Diagnostics Business and expansion of the Pharmaceutical Sciences Business ∎ Co
Slide 35: Medical: Overview by Business
Medical Overview by Business Business ∎ Despite a greater than anticipated prolonged impact of COVID-19 on the Diagnostics Business, projecting a recovery in the 2H; accelerate Pharmaceutical Sciences Business expansion Trends in Net Sales by Business and Overview of Progress Diagnostics (overseas)
Slide 36: Intentionally Blank
Intentionally Blank SEKISUI
Slide 37: Financial Results for 1H FY2020
Financial Results for 1H FY2020 36
Slide 38: Consolidated Companies
Consolidated Companies Number of Consolidated Companies Mar. 31, 2020 Sept. 30, 2020 Difference Consolidated Increased: 2 Subsidiaries*¹ Subsidiaries 163 165 Decreased: 0 Subsidiaries Affiliates Increased: 0 Subsidiaries (Equity Method) 8 8 Decreased: 0 Subsidiaries *1 SEKISUI POLYMATECH EUROPE B.V.
Slide 39: Summary of Profit and Loss
Summary of Profit and Loss 1H FY2019 1H FY2020 Difference (Billions of yen) Net Sales 556.5 490.0 -66.5 Gross Profit 179.4 151.9 -27.5 Gross Profit Margin 32.2% 31.0% -1.2% Selling, Gen. and Admin. Expenses 137.9 129.7 -8.2 Operating Income 41.5 22.1 -19.3 Equity in Earnings of Affiliates 1.4 1.0 -0
Slide 40: Balance Sheets (Assets)
Balance Sheets (Assets) Sept. 30, Inventories (B/S item) 2020 Difference Ready-built housing (products) 23.4 +6.5 Prepared land for subdivision housing 55.2 +4.6 Mar. 31, 2020 Sept. 30, 2020 Difference Land under preparation (work in process) 16.7 +1.6 (Billions of yen) Housing under construction (w
Slide 41: Balance Sheets (Liabilities & Net Assets)
Balance Sheets (Liabilities & Net Assets) (Billions of yen) Mar. 31, 2020 Sept. 30, 2020 Difference Net income Non-interest-bearing Liabilities 350.4 317.5 -32.9 +12.7 Interest-bearing Liabilities 117.7 151.6 +33.9 Dividends paid -10.5 (Net interest-bearing Liabilities) (40.8) (68.1) (+27.2) Retirem
Slide 42: Consolidated Cash Flows
Consolidated Cash Flows 1H FY2019 1H FY2020 (Billions of yen) Operating Cash Flows 51.8 22.0 Investing Cash Flows -18.3 -28.6 Financing Cash Flows 4.0 13.0 Net Increase in Cash and Cash Equivalents 35.3 7.2 Cash and Cash Equivalents at the End of Term 105.6 82.1 Free Cash Flow =Operating Cash Flows
Slide 43: Depreciation and Amortization, Capital Expenditures, EBITDA
Depreciation and Amortization, Capital Expenditures, EBITDA Goodwill and Other Depreciation*1 Capital Expenditures EBITDA*3 Amortization*2 1H 1H Differ- 1H 1H Differ- 1H 1H Differ- 1H 1H Differ- FY2019 FY2020 ence FY2019 FY2020 ence FY2019 FY2020 ence FY2019 FY2020 ence (Billions of yen) Housing 4.7
Slide 44: Depreciation and Amortization, Capital Expenditures, R&D Expenditure
Depreciation and Amortization, Capital Expenditures, Research and Development Expenditure FY2019 FY2020 (Plan) Difference (Billions of yen) Depreciation 40.6 43.0 +2.4 Goodwill and Other Amortization 4.9 7.0 +2.1 Capital Expenditures 66.8 58.0 -8.7 EBITDA 133.2 120.0 -13.2 Research and 37.1 37.0 -0.
Slide 45: Housing Company Results and Plan
Housing Company Results and Plan 1. Main data in Housing 5 business FY2020 FY2019 1H 2H (plan) Annual (plan) 1H 2H Full Year Net Sales (Billions of yen) 230.6 260.4 491.0 256.9 256.0 512.9 Housing 161.2 176.1 337.3 179.3 181.1 360.4 CONSOLIDATED Renovation 41.5 48.9 90.4 49.4 45.6 95.0 Other 28.0 35
Slide 46: Housing Company Results and Plan: Orders and Starts
Housing Company Results and Plan 2. Housing orders FY2020 FY2019 FY2018 (Millions of yen) Annual 1H 2H (plan) 1H 2H Full Year 1H 2H Full Year (plan) Year-start Backlog 205,400 194,500 - 219,500 217,320 - 206,900 213,900 - Growth Rate -6% -11% - +6% +5% - ±0% +3% - New Orders 175,319 198,761 374,080
Slide 47: Forward-looking statements notice
This slide presentation may contain forward-looking statements. Such forward-looking statements are based on current expectations and beliefs and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those expressed or implied by such statemen