Panasonic Holdings Corporation · TSE:6752
Panasonic — Q2 2024 Earnings Presentation
44 slides from Panasonic's earnings presentation, Oct 30, 2023
Slide 1: Fiscal 2024 Second Quarter Financial Results
Fiscal 2024 Second Quarter Financial Results October 30, 2023 Panasonic Holdings Corporation Notes: 1. This is an English translation from the original presentation in Japanese. 2. In this presentation, “Fiscal 2024” or “FY3/24” refers to the year ending March 31, 2024.
Slide 2: Summary of FY3/24 2Q Financial Results
Summary of FY3/24 2Q Financial Results US Inflation Reduction Act (IRA) ‧ FY3/24 2Q: Detailed rules not yet determined; Assumed amount equivalent to tax credit and to be effectively used with customers recorded on P/L (same as 1Q) ‧ Full-year forecast: Increase in assumed amount for IRA tax credit
Slide 3: Impact of US IRA Tax Credit on Financial Results & Forecast
Impact of US IRA Tax Credit on Financial Results & Forecast (Same as 1Q) Among monetization methods “Deductible tax credit” “Refundable tax credit (direct pay)” & “Transferable tax credit,” assuming to elect “Refundable” for FY3/24 Half of total tax credit amount recorded in adjusted OP, assumin
Slide 4: Fiscal 2024 Second Quarter Financial Results
Fiscal 2024 Second Quarter Financial Results Fiscal 2024 Full-Year Financial Forecast
Slide 5: FY3/24 2Q Financial Results
FY3/24 2Q Financial Results (yen: billions) YoY % figures represent the year-on-year change relative to the previous year's figures FY3/24 2Q FY3/23 2Q YoY (year-on-year) Excl. IRA impact Excl. IRA impact 100% -0.3 101% +24.8 Sales 2,089.7 2,114.8 2,090.0 （97%)*3 （-52.3)*3 （99%)*3 （-27.2)*3 Adjusted
Slide 6: FY3/24 2Q Results by Segment
FY3/24 2Q Results by Segment (yen: billions) YoY % figures represent the year-on-year change relative to the previous year's figures Adjusted Other YoY income/ OP EBITDA*1 Sales OP YoY YoY YoY YoY (excl. FX) (% to sales) (% to sales) (% to sales) loss 96% 29.6 21.5*4 48.8*4 Lifestyle 844.3 (95%) -3.
Slide 7: FY3/24 2Q Sales Analysis by Segment
FY3/24 2Q Sales Analysis by Segment Overall sales at the same level year-on-year: Increased sales (Automotive, Connect) and currency translation, despite largely decreased sales (Lifestyle, Industry) (yen: billions) • Sales increase Other/Eliminations & adjustments 2,090.0 -45.5 +6.0 -47.3 in real t
Slide 8: FY3/24 2Q Operating Profit Analysis by Segment
FY3/24 2Q Operating Profit Analysis by Segment Adjusted OP increased: Increased in Automotive and Connect, as well as IRA impact (Energy), despite decreased in Lifestyle and Industry (yen: billions) IRA impact: +21.4 +11.8 -2.2 +4.8 -3.0 102.4 +9.5 -10.2 +8.6 Industrial / Other/ Other 86.1 -3.0 Conn
Slide 9: Lifestyle Segment: FY3/24 2Q Results by Divisional Company
Lifestyle Segment: FY3/24 2Q Results by Divisional Company (yen: billions) YoY % figures represent the year-on-year change relative to the previous year's figures Adjusted Other YoY OP EBITDA*2 Sales (Excl. FX) OP YoY income/ YoY (% to sales) YoY (% to sales) YoY (% to sales) loss Living Appliances
Slide 10: FY3/24 2Q Operating Profit Analysis (by Factor)
FY3/24 2Q Operating Profit Analysis (by Factor) Adjusted OP increased: Progress in price revisions and rationalization, amount equivalent to IRA tax credit recorded as profit, etc. (yen: billions) Effect of Other exchange rates income/loss IRA impact Sales Blue Yonder (BY) +6.0 -3.0 102.4 increase/d
Slide 11: FY3/24 1H Cash Flows and Cash Positions
FY3/24 1H Cash Flows and Cash Positions Operating CF: Increased year-on-year; efforts to reduce strategic inventories, etc. Inventories: Further reduce inventories in 2H and onward, toward optimization of inventory level Cash Flow Gross cash & interest-bearing debt / Net cash (yen: billions) (ye
Slide 12: Shareholder Return: Interim Dividend (FY3/24)
Shareholder Return Interim dividend determined at 17.5 yen per share; year-on-year increase by 2.5 yen (same as forecast announced on Aug. 31) Interim Dividend Forecast (as of Aug 31): 17.5 yen 17.5 yen Interim dividend (FY3/23): 15.0 yen (FY3/24) • Distribute stable and continuous dividends in
Slide 13: Fiscal 2024 Full-Year Financial Forecast
Fiscal 2024 Second Quarter Financial Results Fiscal 2024 Full-Year Financial Forecast
Slide 14: FY3/24 Full-Year Forecast Revision
FY3/24 Full-Year Forecast Revision YoY % figures represent the year-on-year change relative to the previous year's figures FY3/24 (e) FY3/24 (e) (yen: billions) Excl. IRA impact Difference FY3/23 Excl. IRA impact YoY Excl. IRA impact (Oct. 30, 2023) (Jul. 31, 2023) Sales 8,400.0 8,499.0 8,500.0 -100
Slide 15: FY3/24 Full-Year Forecast Revision by Segment
FY3/24 Full-Year Forecast Revision by Segment YoY % figures represent the year-on-year change relative to the previous year's figures Difference Adjusted Difference Other Difference Difference Difference from from from OP from EBITDA*1 from (yen: billions) Sales YoY forecast OP YoY forecast income/
Slide 16: FY3/24 Full-year Forecast Revision Factors (by Segment)
FY3/24 Full-year Forecast Revision Factors (by Segment) Major factors for revision (vs. initial forecast as of May 10) Both sales & profit revised downward Sales • Sales: Deteriorating market conditions for consumer electronics business and (yen: billions) IRA impact: -99.0 Automotive +30.0 -50.0 ch
Slide 17: Lifestyle Segment: Full-Year Forecast Revision by Divisional Company
Lifestyle Segment: FY3/24 Full-Year Forecast Revision by Divisional Company (yen: billions) YoY % figures represent the year-on-year change relative to the previous year's figures Difference Adjusted Difference Other Difference Difference Difference from from from OP from EBITDA*2 from Sales YoY for
Slide 18: FY3/24 Full-year Operating Profit Forecast Revision Analysis (by Factor)
FY3/24 Full-year Operating Profit Forecast Revision Analysis (by Factor) Sales Price hikes in Price revisions, Effect of Other increase/decrease Fixed costs raw materials & rationalization, IRA impact Blue Yonder exchange rates in real terms logistics etc. income/loss (yen: billions) +80.0 -5.4 -20.
Slide 19: Lifestyle: HVAC Business Situation in Europe
Lifestyle: Heating & Ventilation A/C Company - HVAC Business Situation in Europe ■Changes in business environment [ As of June 2 (Operating Company Strategy Briefing)] [Current situation] [Initiatives] 1) Increasing demand for A2W to replace combustion-based boilers 1) Demand growth slowdown 1) Cont
Slide 20: Medium- to Long-term Strategy for HVAC Business in Europe
Lifestyle: Heating & Ventilation A/C Company Medium- to Long-term Strategy for HVAC Business in Europe ■ A2W in Europe: Medium- to long-term market outlook Expecting demand recovery toward CY2030, supported by EU carbon neutral initiatives; Take actions with flexibility while mitigating risks (Subsi
Slide 21: Industry: Market Conditions by Area and Full-Year Forecast for FY3/24
Industry: Market Conditions by Area and Full-Year Forecast for FY3/24 Sales Composition FY3/24 Forecast Panasonic Industry products FY3/24 • Upper row: Market outlook (estimate by Panasonic), estimate by Panasonic • Bottom row: Sales forecast (Panasonic Industry products, vs. FY3/23, estimate by
Slide 22: Industry: Situation of Voluntarily Disclosed Businesses
Industry: Situation of Voluntarily Disclosed Businesses Electronic Devices FA Solutions Aim for recovery of China business (accounts for approx. 40% sales*) Automotive CASE-related products (accounts for approx. 50% sales*): through localization of decision making, product development meeting Gr
Slide 23: Energy: Automotive Battery - FY3/24 2Q Downturn Factors & Initiatives
Energy: Automotive Battery - FY3/24 2Q Downturn Factors & Initiatives ・ North American EV demand shift caused by IRA 30D: Production in Japan factory affected by demand slowdown in high-end EVs, while North America factory remained steady ・ In FY3/24 2Q, profitability deteriorated considerably due t
Slide 24: Panasonic Group
Panasonic Group
Slide 25: Disclaimer Regarding Forward-Looking Statements
Disclaimer Regarding Forward-Looking Statements This presentation includes forward-looking statements about Panasonic Holdings Corporation (Panasonic HD) and its Group companies (the Panasonic Group). To the extent that statements in this presentation do not relate to historical or current facts, th
Slide 26: Reference: Overview of US Inflation Reduction Act (IRA)
Reference: Overview of US Inflation Reduction Act (IRA) IRA: Enacted in August 2022, aimed to reduce excessive inflation and promote energy policies Panasonic Energy’s business expected to be eligible for “battery cell ($35/kWh)” in Section 45X Rules on Section 30D announced in March 2023, but
Slide 27: Reference: Eligible EV Battery Factories for IRA
Reference: Eligible EV Battery Factories for IRA Credit effective at: - Nevada Factory (already in operation): from launch of IRA - Kansas Factory (under construction): upon start of production & sales during FY3/25 (planned) <Ref.> Simple calculation: Factories Credit effective from Annual produc
Slide 28: Reference: Initiatives in Growth Areas
Reference: Initiatives in Growth Areas Underlined: Changes/progress from July 2023 (Automotive Battery, Supply Chain Management Software, Air Quality & Air-conditioning) Achieve profit growth, focusing on North America market where we can leverage advantages (high-capacity cells) with strong busines
Slide 29: (Reference) FY3/24 1H Results
(Reference) FY3/24 1H Results YoY % figures represent the year-on-year change relative to the previous year's figures (yen: billions) FY3/24 1H Excl. IRA impact FY3/23 1H YoY (year-on-year) Excl. IRA impact 101% +55.5 103% +104.8 Sales 4,119.4 4,168.7 4,063.9 （99%)*3 （-47.0)*3 （100%)*3 （+2.3)*3 Adju
Slide 30: (Reference) FY3/24 Financial Results/Forecast (1H/2H/Full-Year)
(Reference) FY3/24 Financial Results/Forecast (1H/2H/Full-Year) (yen: billions) YoY % figures represent the year-on-year change relative to the previous year's figures 1H Full-year results Excl. IRA YoY Excl. IRA 2H (e) Excl. IRA YoY Excl. IRA forecast Excl. IRA YoY Excl. IRA impact impact impact im
Slide 31: (Reference) Results/Forecast by Segment (1H/2H/Full-Year)
(Reference) FY3/24 Financial Results/Forecast by Segment（1H/2H/Full-Year) (yen: billions) YoY % figures represent the year-on-year change relative to the previous year's figures 1H 2H (e) Full-year forecast Adjusted Adjusted Adjusted Sales YoY OP YoY Sales YoY OP YoY Sales YoY OP YoY (% to sales) (%
Slide 32: (Reference) Lifestyle Segment by Divisional Company (1H/2H/Full-year)
(Reference) Lifestyle Segment: FY3/24 Financial Results/Forecast by Divisional Company (1H/2H/Full-year) (yen: billions) YoY % figures represent the year-on-year change relative to the previous year's figures 1H 2H (e) Full-year forecast Adjusted Adjusted Adjusted Sales YoY OP YoY Sales YoY OP YoY S
Slide 33: Reference: FY3/24 2Q Segment Information Lifestyle
Reference: FY3/24 2Q Segment Information Lifestyle Sales: Decreased due to slowed growth of HVAC business in Europe, weaker demand for Overview consumer electronics in Asia and China, deconsolidation impact, despite steady (yen: billions) FY3/24 2Q YoY (year-on-year) sales of cold chain mainly in No
Slide 34: Reference: FY3/24 2Q Segment Information Automotive
Reference: FY3/24 2Q Segment Information Automotive Overview Sales: Increased due to recovery in automobile production of our customers (yen: billions) FY3/24 2Q YoY (year-on-year) +15.3 367.2 114% (yen: billions) Sales 367.2 +10.3 (109%) *1 +8.3 Effect of Adjusted operating 8.7 +8.6 +10.3 Others*2
Slide 35: Reference: FY3/24 2Q Segment Information Connect
Reference: FY3/24 2Q Segment Information Connect Overview Sales: Increased overall due to increased sales in Avionics, Gemba Solutions and (yen: billions) FY3/24 2Q YoY (year-on-year) Blue Yonder, despite decreased sales in Process Automation 106% Process (yen: billions) Sales 288.5 (102%) *1 Automa
Slide 36: Reference: Blue Yonder's KPIs
Reference: Blue Yonder’s KPIs Connect Revenue / Adjusted OP (stand alone) Recurring / SaaS ratio Sales: Steady growth of both total sales and SaaS Steady sales trend for both recurring and SaaS ratio Profit: ncreased YoY in real terms excl. strategic investment Recurring ratio （M US$） YoY 309 30
Slide 37: Reference: FY3/24 Full-Year Forecast of Blue Yonder
Reference: FY3/24 Full-Year Forecast of Blue Yonder Connect Adjusted OP (stand alone) excluding strategic investment for future growth (product enhancement & synergy creation): In 1H: Increased year-on-year by 5.0 bil. yen to 5.2 bil. yen For full-year: Forecast revised upward, expecting year-on
Slide 38: Reference: FY3/24 2Q Segment Information Industry
Reference: FY3/24 2Q Segment Information Industry Sales: Decreased due mainly to downturn in market conditions (e.g. China, ICT) and Overview changes in semiconductor sales channel, despite continuous growth of green YoY PID vehicles markets and expanding demand in products for AI servers (yen: bill
Slide 39: Reference: Full-Year Sales Forecast by Voluntarily Disclosed Business
(Reference) FY3/24 Full-Year Sales Forecast by Voluntarily Disclosed Business Industry Electronic Devices FA Solutions Electronic Materials Forecast for FY3/24 Forecast for FY3/24 Forecast for FY3/24 Sales 520.0 billion yen Sales 105.0 billion yen Sales 155.0 billion yen ICT Terminals 9% Other (-1％)
Slide 40: Reference: FY3/24 2Q Segment Information Energy
Reference: FY3/24 2Q Segment Information Energy Overview Sales: Sales increased in real terms excluding IRA impact to be effectively used with customers; In In-vehicle, favorable sales mainly at North America factory, despite (yen: billions) FY3/24 2Q YoY (year-on-year) reduced production in Japan.
Slide 41: Reference: FY3/24 2Q Operating Profit & Net Profit
Reference: FY3/24 2Q Operating Profit & Net Profit (yen: billions) YoY FY3/24 2Q FY3/23 2Q (year-on-year) Operating profit 102.4 86.1 +16.3 Non-operating income/loss 13.2 7.0 +6.2 Profit before income taxes 115.6 93.1 +22.5 Income taxes -24.1 -29.7 +5.6 Net profit 91.5 63.4 +28.1 Net profit attribut
Slide 42: Reference: Medium-term Management Indicators: KGI
Reference: Medium-term Management Indicators: KGI (yen: billions） Cumulative Operating CF ROIC (FY3/23-25) (FY3/25) Lifestyle 660 10.0% or more *1 Automotive 200 6.4% Connect 260 4.6% *2 Industry 390 or more 17% or more *3 Energy 330 12.0% Group Total 2,000 ROE 10% or more Note: Above data from pres
Slide 43: Reference: List of Voluntarily Disclosed Businesses in FY3/24
Reference: List of Voluntarily Disclosed Businesses in FY3/24 Businesses with Sales Disclosed Lifestyle Major Business Divisions, etc. (Panasonic Corporation) (Adjusted OP disclosed for underlined businesses) Living Appliances and • Kitchen Appliances : Kitchen Appliances BD Note 1: Sales and profit
Slide 44: Reference: Integrated Report 2023
(Reference) Integrated Report 2023 Released in September 2023 Main contents of Integrated Report 2023 Expanding businesses that Group CEO contribute to solving global environmental issues Message Our approach to business portfolio management Progress of the medium-term strategy and outlook for