Slide 1: Analyst Guide FY2015
ANALYST GUIDE FY2015 October 2015 (Listed on the 1st Section of the Tokyo Stock Exchange; Code 7447) <Contact for information on this material: Mr. Ohno, Administration Headquarters (03-5289-8200)>
Slide 2: Agenda
Agenda I About “NAGAILEBEN” II Financial Review FY2015 III Market Environment IV Forecast for FY2016 V Management Goals VI Rewarding shareholder-focused policies 1
Slide 3: I About Nagaileben
I About “NAGAILEBEN” 2
Slide 4: Nagaism
“Nagaism” Time of 100 years has created our company spirit. Believing Human Concentrating Pursuing principal Started white robe business in 1915. Nagaism 1915 Started Business 1969 Founded Manufacturing Division Profit Contribution 1971 Succeed in first polyester medical clothing in Japan Business m
Slide 5: Social Responsibility; To grow Steadily and Stably
Profit Reimbursement to Shareholders Continue stable dividend payment with payout ratio of 50% DPS will be ¥100 as 100th anniversaries Share buyback (¥ million) 3,500 3,000 Commemorative 2,500 divident Social Responsibility 2,000 1,500 Job creation at Regional Community 1,000 Regular -Domestic: Akit
Slide 6: Outline
Outline Establish competitive position in Strong growing market medical clothing market Doctor, Dentist, Nursing Staff*2 Care workers*3 Pharmacist*1 -Approximately 60% market share (2012) (2013) (2013) in domestic medical clothing 690,000 1,570,000 1,710,000 -Wide field, planning, manufacturing peop
Slide 7: II Financial Review FY2015
II Financial Review FY2015 6
Slide 8: Overview FY2015
Overview FY2015 Income 1 - Net Sales remained previous year approximately - Operating & Recurring income declined slightly from previous year The Change of Business Environment 2 - Market Condition: Being revised care service treatment fees negative, market condition was stable - Production Conditio
Slide 9: Financial Highlights <Statements of Income>
Financial Highlights <Statements of Income> (millions of yen,%) FY2015 % Change To Forecast % Composition % Composition % Change Net sales 16,150 -0.4 -3.3 100.0 - Gross profit 7,532 -0.7 -1.9 46.6 -0.1 Sales, general, and 2,719 +2.1 -1.2 16.8 +0.4 administrative expenses Operating income 4,813 -2.2
Slide 10: Financial Highlights <Balance Sheet>
Financial Highlights <Balance Sheet> Major assets (¥ million %) Title Result Change Result Change % [Major changes from the previous fiscal year] Cash on hand at banks 18,673 -380 -2.0 Cash and cash equivalents down ¥380million Notes and accounts receivable 4,689 -6 -0.1 -Cash flows from operating a
Slide 11: Segments by item
Segments by item Healthcare wear Patient wear Shoes Doctors' wear Utility wear Surgery wear 10
Slide 12: Sales by Item
Sales by Item Doctors' 16.1% Utility 4.1% [Healthcare wear] Patient -In 4Q, high functional products caught renewal contracts 9.0% which were postponed and sales kept the previous year. [Doctors' wear] Surgery -As sales grew steadily for several years, the demand 9.7% seemed to be calming-down. Heal
Slide 13: Sales by Region
Sales by Region Central Japan 11.0% [East Japan] West Japan - Sales declined. In 4Q, catching renewal contracts 36.2% which were postponed and focusing on promotion, however, postponed contracts occurred. [Central Japan] -Market size was not large and there was the influence by the size of contracts
Slide 14: III Market Environment
III Market Environment 13
Slide 15: Market Environment Topics
Market Environment Topics Medical treatment fees will be revised.(effective Apr. 2016) - The previous revise rate +0.10% (Consumption tax raise+1.36%, Treatment fees -1.26%) - Revise rate is not obvious. Escalating material prices, rising sewing costs -The price of cloth and material increased. -The
Slide 16: Market Environment
Market Environment Changes and prospects for medical and care service systems Medical System Care Service System Medical Service Law, Health and Medical Medical treatment fees Care Service Law, Nursing Care Insurance, etc. Nursing care fees Service Law for the Aged, Medical Insurance, etc Proposed d
Slide 17: Revisions to medical treatment and care service fees
Market Environment Revisions to medical treatment and care Service fees （％） 5 Medical 4 Care Service Consumption tax increase +3.0 3 +2.6 +2.8 2 +1.0 +1.2 1 +0.8 +0.8 +0.8 +0.6 +0.5 +0.4 +0.2 +0.2 +0.0 +0.1 0 -1 ▲0.3 ▲0.1 ▲0.8 -2 ▲1.3 Consumption tax increase +1.63% Service -1.26% -3 ▲2.3 ▲2.4 ▲2.3
Slide 18: Supply and Demand of Nursing Staff
Market Environment Supply and Demand of Nursing Staff (Source: the Ministry of Health, Labor and Welfare (December 2010)) (10,000 persons) Change to actual number as 175 Demand from the 7th Outlook. Forecast Actual Decreased number of nursing staff on both supply 150 and demand sides for technical r
Slide 19: Supply and estimated future need for care workers
Market Environment (10,000 persons) 300 Supply and estimated future need for care workers Forecast 253 250 Actual 200 150 253 100 163 171 151 1 2 8 136 143 120 109 114 50 96 85 64 72 55 0 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '25 Since the number of track records are subject to the
Slide 20: Supply and estimated future need
Market Environment Supply and estimated future need (10,000 persons) 300 Nursing Staff care workers forecast(maximum) 253 250 forecast(minimum) Actual 200 206 150 253 100 196 171 157 50 0 2012 2025 2013 2025 Actual record: Japanese Nursing Associations’ statistical data Ministry of Health, Labor and
Slide 21: IV Forecast for FY2016
IV Forecast for FY2016 20
Slide 22: Management Tasks and Status
Management Tasks and Status •Capture clusters of needs Marketing strategy in the healthcare wear market to boost sales •Increase peripheral business in products for patients and surgery •Develop new markets •Strengthen ties with material makers and trade firms Production strategy to •Develop new pro
Slide 23: Forecast Statements of Income
Forecast Statements of Income (millions of yen,%) FY2016E % Change (FY2015) Composition % Change Net sales 16,500 +2.2 － Gross profit 7,590 +0.8 -0.6 Sales, general, and administrative expenses 2,776 +2.1 0.0 Operating income 4,813 +0.0 -0.6 Recurring income 4,869 -4.3 -2.0 Net income 3,237 +0.3 -0.
Slide 24: Forecast of Sales by Item
Forecast of Sales by Item Sales by Item (¥ million) Year-on-year change FY2015 FY2016E 18,000 Sales -0.4% +2.2% 16,000 Shoes/Others 14,000 Healthcare wear -0.1% +2.2% Surgery wear 12,000 Doctors' wear -2.6% +2.5% Patient wear 10,000 Utility wear -9.8% -7.5% 8,000 Utility wear Patient wear +7.2% +4.7
Slide 25: Forecast of Sales by Region
Forecast of Sales by Region Sales by Region (¥ million) Year-on-year change FY2015 FY2016E 18,000 Total sales -0.4% +2.2% 16,000 14,000 Overseas East Japan -1.2% +1.7% 12,000 Central Japan +1.7% +1.4% West Japan 10,000 West Japan +0.0% +2.7% 8,000 Central Japan Overseas +5.4% +13.6% 6,000 4,000 East
Slide 26: Product Strategy
Product Strategy Sales by Product (¥ million) Year-on-year change FY2015 FY2016E 18,000 Sales -0.4% +2.2% 16,000 DC brand products -9.9% -5.5% DC brand 14,000 products High Functional products +3.8% +5.1% 12,000 High Functional Standard Functional -3.2% +0.8% 10,000 products products 8,000 Standard
Slide 27: Production Strategy
Production Strategy Production(Non-Consolidated) (¥ million) (%) 10,000 50 Composition FY2015 FY2016E Purchased products Domestic production 53.0 51.5 7,500 45 Overseas production 45.6 47.1 Overseas production Purchased products 1.5 1.4 5,000 40 Domestic production 2,500 35 Ratio of overseas product
Slide 28: V Management Goals
V Management Goals 27
Slide 29: Business Direction
Business Direction Sales Strategy -Increase peripheral business in products for patients and surgery. -Gain share In West Japan. -Develop and sale of high functional products. Profit Strategy -Driving the strategy of higher quality and value-added products. -The shift to overseas production. -The mi
Slide 30: Sales Strategy: Sales by Products
Sales Strategy FY2012 FY2015 FY2018E (3 terms ago) (Previous term) (3 terms later) net sales ¥15,175 million ¥16,150 million ¥17,500 million Healthcare Doctors' 58% 57% 16% 58% 16% 16% Sales by Item Utility 2% 6% 4% 9% Patient 8% Patient 11% 9% Surgery 10% Surgery 3% Others 3% 2% 12% Central Japan 1
Slide 31: Net Sales and Gross Profit to Sales Ratio
Net Sales and Gross Profit to Sales Ratio (¥ million) (%) 17,500 Net sales (left) 15,000 55 Gross profit to sales (right) 12,500 10,000 45 7,500 5,000 35 2,500 0 25 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 14 14 15 16E17E18E (FY) Note: Consol
Slide 32: VI Rewarding shareholder-focused policies
ⅤI Rewarding shareholder-focused policies 31
Slide 33: Profit Reimbursement to Shareholders
Profit Reimbursement to Shareholders Shareholder-focused policies - Improvement of transparency by proactive disclosure - Interactive communication with investors - Profit reimbursement by high dividends Dividend policy - Basic policy is to continue stable dividend payment with payout ratio of 50% -
Slide 34: The History of Stock Value
The History of Stock Value BPS EPS DPS （Yen） （円） （yen） （yen） （yen） 1,100 100 FY2001 532.5 50.8 12.5 FY2002 568.3 48.0 12.5 1,000 FY2003 604.0 52.4 15.0 FY2004 663.0 60.5 30.0 900 75 FY2005 700.0 56.7 30.0 ※1 FY2006 732.4 61.0 30.0 FY2007 764.3 61.9 30.0 800 FY2008 783.9 57.1 30.0 FY2009 791.0 42.9 3
Slide 35: Actual Dividends Paid
Actual Dividends Paid Total dividend Share buyback Payout ratio Total return ratio （Million yen） （Million yen） （non-c, ％） （non-c, ％） FY2001 475 0 27.6 27.6 FY2002 475 0 29.3 29.3 FY2003 530 1,697 29.7 124.6 FY2004 744 0 36.5 36.5 FY2005 1,117 0 56.9 56.9 FY2006 1,117 0 53.4 53.4 FY2007 1,117 0 53.1
Slide 36: Management Philosophy
Management Philosophy We will provide medical products and services of the highest quality, as the leading company to link "medical services" and "clothing." - Consistently challenging spirit to lead the industry - Achievement of contribution to society - "Respect for Harmony among People" people ar
Slide 37: Notes on this material
Notes on this material This material includes forecasts for the future. These forecasts are based on the judgment of the Company's management concerning currently available information. These future projections include assumptions or views based on assumptions, and therefore may be different from th
Slide 38: Data File
Data File FY2015 (Listed on the 1st Section of the Tokyo Stock Exchange;Code 7447) <Contact for information on this material: Mr. Ohno, Administration Headquarters (03-5289-8200)>
Slide 39: Index
Index 1 … Sales by Item 2 … Sales by Product 3 … Sales by Region 4 … Rationalization of the Production System and Our Purchasing Strategy (Non-Consolidated) 5 … Statements of Income (Consolidated) 6 … Statements of Income (Non-Consolidated) 7 … Indices (Consolidated) 8 … Indices (Non-Consolidated) 9
Slide 40: 1. Sales by Item
1. Sales by Item (¥ million) First-half First-half FY 12/8 13/8 14/8 15/8 16/8E 14/8 15/8 Sales 15,175 15,625 16,214 16,150 16,500 6,775 6,840 (¥ million) Healthcare wear 8,769 9,039 9,440 9,429 9,640 3,914 4,011 18,000 Doctors' wear 2,483 2,566 2,674 2,604 2,670 1,064 1,046 Utility wear 864 796 743
Slide 41: 2. Sales by Product
2. Sales by Product (¥ million) First-half First-half (¥ million) FY 12/8 13/8 14/8 15/8 16/8E 14/8 15/8 18,000 Sales 15,175 15,625 16,214 16,150 16,500 6,775 6,840 DC brand products 1,024 933 938 846 800 394 366 16,000 High Functional products 6,547 7,212 7,795 8,090 8,500 3,267 3,457 Standard Func
Slide 42: 3. Sales by Region
3. Sales by Region (¥ million) First-half First-half FY 12/8 13/8 14/8 15/8 16/8E 14/8 15/8 (¥ million) Sales 15,175 15,625 16,214 16,150 16,500 6,775 6,840 18,000 East Japan 8,106 8,390 8,461 8,357 8,500 3,422 3,430 Central Japan 1,564 1,591 1,745 1,774 1,800 779 787 16,000 West Japan 5,386 5,508 5
Slide 43: 4. Rationalization of the Production System and Purchasing Strategy
4. Rationalization of the Production System and Our Purchasing Strategy(Non-Consolidated) (¥ million) First-half First-half (¥ million) (％) FY 12/8 13/8 14/8 15/8 16/8E 10,000 50 14/8 15/8 Domestic production 5,056 4,951 5,061 4,901 4,813 2,454 2,495 Overseas production 3,441 3,550 4,017 4,215 4,401
Slide 44: 5. Statements of Income (Consolidated)
5. Statements of Income (Consolidated) (¥ million) First-half First-half FY 12/8 13/8 14/8 15/8 16/8E 14/8 15/8 Net Sales 15,175 15,625 16,214 16,150 16,500 6,775 6,840 Gross profit 7,103 7,346 7,585 7,532 7,590 3,169 3,187 Sales, general, and administrative expense 2,461 2,473 2,662 2,719 2,776 1,3
Slide 45: 6. Statements of Income (Non-Consolidated)
6. Statements of Income (Non-Consolidated) (¥ million) First-half First-half FY 12/8 13/8 14/8 15/8 16/8E 14/8 15/8 Net Sales 15,166 15,616 16,199 16,141 16,500 6,767 6,831 Gross profit 6,794 7,031 7,270 7,218 7,270 3,032 3,053 Sales, general, and administrative expenses 2,493 2,482 2,662 2,718 2,77
Slide 46: 7. Indices (Consolidated)
7. Indices (Consolidated) First-half First-half (Unit) 11/8 12/8 13/8 14/8 15/8 14/8 15/8 Profitability ROE (%) 8.5 7.8 9.7 9.5 9.3 - - ROA (%) 13.0 14.3 15.0 13.5 13.0 - - Return on sales Net income (%) 17.1 15.6 20.0 19.9 20.0 - - ROE resolution Total Assets Turnover (Times) 0.4 0.4 0.4 0.4 0.4 -
Slide 47: 8. Indices (Non-Consolidated)
8. Indices (Non-Consolidated) First-half First-half (Unit) 11/8 12/8 13/8 14/8 15/8 14/8 15/8 Profitability ROE (%) 8.6 7.8 10.3 10.1 9.8 - - ROA (%) 13.1 14.1 15.7 14.2 13.7 - - Return on sales Net income (%) 15.9 14.4 19.3 19.4 19.4 - - ROE resolution Total AssetsTurnover (Times) 0.5 0.5 0.5 0.5 0
Slide 48: 9. Statements of Income (Consolidated)
9. Statements of Income (Consolidated) (¥ million,%) (¥ million,%) FY 14/8 14/8 Change(the previous year) First-half 14/8 First-half 15/8 Change(the previous year) Result Composition Result Composition Result Change % Result Composition Result Composition Result Change % Net Sales 16,214 100.0 16,15
Slide 49: 10. Statements of Income (Non-Consolidated)
10. Statements of Income (Non-Consolidated) (¥ million,%) (¥ million,%) FY 14/8 15/8 Change(the previous year) First-half 14/8 First-half 15/8 Change(the previous year) Result Composition Result Composition Result Change % Result Composition Result Composition Result Change % Net Sales 16,199 100.0
Slide 50: 11. Balance Sheet (Consolidated)
11. Balance Sheet (Consolidated) (¥ million,%) (¥ million,%) FY 14/8 15/8 Change(the previous year) First-half 14/8 First-half 15/8 Change(the previous year) Result Composition Result Composition Result Change % Result Composition Result Composition Result Change % Current assets 29,589 75.6 29,711
Slide 51: 12. Balance Sheet (Non-Consolidated)
12. Balance Sheet(Non-Consolidated) (¥ million,%) (¥ million,%) FY 14/8 15/8 Change(the previous year) First-half 14/8 First-half 15/8 Change(the previous year) Result Composition Result Composition Result Change % Result Composition Result Composition Result Change % Current assets 26,568 74.1 26,4