Innotech Corporation · TSE:9880
Innotech — Q1 FY2008 Earnings Presentation
32 slides from Innotech's earnings presentation, Aug 13, 2008
Slide 1: FY2008, 1st Quarter Financial Results
August 13, 2008 FY2008, 1st Quarter Financial Results
Slide 2: Agenda
Agenda 1 FY2007 Q1 Results 2 FY2008 Outlook 3 Summary 2
Slide 3: Topics of Q1, 2008
Topics of Q1, 2008 35% decrease in revenue, 47% decrease in operating profit. In the semiconductor design business, orders for testers have fallen on reduced. Cadence sales have declined with the growth of multi-year license contracts. In the electronic components business, HDD revenue has declined
Slide 4: Results of Q1, FY2008
Results of Q1, FY2008 〔Million yen〕 Sanei Overseas Innotech IT ACCESS Consolidated Q１,2007 Change* Hytechs Sales Net Sales 7,254 812 651 1,298 8,959 13,762 -35% C o s t o f Goods Sold 5,981 657 384 1,260 7,218 11,592 -38% Gross Profit 1,272 155 267 37 1,741 2,169 -20% S G A 952 112 132 36 1,275 1,29
Slide 5: Comparison by segment
Comparison by segment 〔Million Yen〕 Q1, FY2007 Q1, FY2008 Change Net Sales 13,762 8,959 -35% Semiconductor Design 4,783 3,674 -23% Electronic Components 8,979 5,285 -41% Cost of Goods Sold 11,592 7,218 -38% Gross Profit 2,169 1,741 -20% Semiconductor Design 1,347 1,093 -19% Electronic Components 822
Slide 6: Cadence
Cadence ［Sales：Million Yen］ Q1, FY2007 1,926 Q1, FY2008 1,623 Drop in sales due to license model change 6
Slide 7: Semiconductor Testors
Semiconductor Testors ［Sales：Million Yen］ Q1, FY2007 1,482 Q1, FY2008 956 Reduced investment in a tough business environment 7
Slide 8: ASIC Consignment Business
ASIC Consignment Business ［Sales：Million Yen］ Q1, FY2007 465 Q1, FY2008 283 Existing business has passed its peak 8
Slide 9: Design Consignment Business (Sanei Hytechs)
Design Consignment Business （Sanei Hytechs） ［Sales：Million Yen］ Q1, FY2007 910 Q1, FY2008 812 Decrease in consignment business 9
Slide 10: HDD
HDD ［Sales：Million Yen］ Q1, FY2007 6,868 Q1, FY2008 3,336 Significant drop in sales due to end of small-size HDD production 10
Slide 11: Electronic Devices
Electronic Devices ［Sales：Million Yen］ Q1, FY2007 1,489 Q1, FY2008 1,298 Reduction for flat-screen TVs and DVD products 11
Slide 12: Embedded Software Development (IT Access)
Embedded Software Development （IT Access） ［Sales：Million Yen］ Q1, FY2007 622 Q1, FY2008 651 13% increase in revenue thanks to strong consignment development 12
Slide 13: Agenda
Agenda 1 FY2007 Q1 Results 2 FY2008 Outlook 3 Summary 13
Slide 14: Business Environment FY2008
Business Environment FY2008 Reduced Investment on semiconductor equipment with weakening market conditions Demand downturn for custom semiconductor design, cost reduction for design Component prices decline in intensifying digital home electronics price competition Conservative shift of purchasing a
Slide 15: Different impacts on business segment
Different impacts on business segment Solid Cadence Embedded Software Development Design （IT ACCESS） Design Consignment （Sanei Hytechs） ASIC Design/Sales Reduced Investment Manufacturing Weak Market Semiconductor Testers Price Pressure Demand Downturn Sales HDD Electronic Devices Severity
Slide 16: Topics of FY2008
Topics of FY2008 Sales: 48 billion yen→33 billion yen, ordinary profit: 3.3 billion yen→1.6 billion yen Business forecasts have been revised downward Semiconductor design business: Reduction in tester sales due to reduced semiconductor equipment investment Expansion of multi-year cadence contracts E
Slide 17: Revised Forecast by business segment
Revised Forecast by business segment 〔Million Yen〕 Q1, FY2007 Q1, FY2008 Change Net Sales 52,836 33,000 -38% Semiconductor Design 18,927 15,800 -17% Electronic Components 33,909 17,200 -49% Cost of Goods Sold 44,272 26,100 -41% Gross Profit 8,564 6,900 -19% Semiconductor Design 5,517 4,380 -21% Elec
Slide 18: Revised sales forecast by business
Revised sales forecast by business 〔Million Yen〕 FY2007 FY2008 Change Semiconductor Design 18,927 15,800 -17% Cadence and Others (*1) 7,984 7,600 -5% Semiconductor Testers and Others (*1) 5,497 3,600 -35% ASIC Design/Sales (*2) 1,702 900 -47% Design Consignment 3,744 3,700 -1% （Sanei Hytechs） Electr
Slide 19: FY 2008 Prospects
FY 2008 Prospects Sales Ordinary Profit ［Billion yen］ ［Billion yen］ 40 2 33 1.6 30 20 16.5 1 0.6 10 9 0.4 0 0 Q1 Q2 FY2008 Q1 Q2 FY2008 19
Slide 20: Semiconductor Testors
Semiconductor Testors Downturn Factors Significant limitations on investment Delayed development of new business ［Sales：Million Yen］ Previous Prospect 6,200 Revised Prospect 3,600 20
Slide 21: HDD
HDD Downturn Factors Sluggish sales of DVRs Reduction in market share for MFPs ［Sales：Million Yen］ Previous Prospect 17,500 Revised Prospect 10,600 21
Slide 22: Electronic Devices
Electronic Devices Downturn Factors Weak sales for digital TVs, DVD products Delayed launch of new products ［Sales：Million Yen］ Previous Prospect 7,700 Revised Prospect 4,000 22
Slide 23: Agenda
Agenda 1 FY2007 Q1 Results 2 FY2008 Outlook 3 Summary 23
Slide 24: License Fee
Cadence etc. [Long-term growth foundation] Sales Forecast (Expansion of multi-year license model) 0.9 bil. yen License Fee One-time license (lump sum calculation) 7.9 7.6 bil. yen bil. yen FY2007 FY2008 (Est.) Multi-year license (term calculation) License Fee Order Backlog First year Second year Thi
Slide 25: Semiconductor Testers
Semiconductor Testers Customer Base Dynamic medium-term growth trend of NAND market New Development Further enhancement of engineering resources Business Domain Varied tester-related solutions (Million units) Market Trends by NAND Application (In GB) PC (SSD) USB Notebook PC SSD market: Digital cons
Slide 26: Design Consignment Business (Sanei Hytechs)
Design Consignment Business (Sanei Hytechs) [100 mil. yen] 40 Sales trend 30 Consecutive recruiting of design 407 engineer 20 393 One of the largest scale among 372 independent design houses 10 Net Sales Engineers (Including outsourcing) 0 FY2006 FY2007 FY2008 (Est.) [Efforts for the present ter
Slide 27: ASIC Design Consignment Business
ASIC Design Consignment Business Start of full-scale, mass-production in Japan Expansion of business for medical, communications, Release new products and digital home electronics for the 45nm era Development cooperation with Sanei Hytechs Expansion of business targeting storage-related products
Slide 28: HDD
HDD Active expansion of business through new collaboration Familiar to customers Establishment of business outside the PC sector profitability Reliable service system Cost competitiveness Comprehensive emphasis on High reliability based on technical profit margins capabilities and achievements Recap
Slide 29: Electronic Devices
Electronic Devices Expanded Product Lineup Based on Silicon Image Achievements For Advanced CE For Industrial Use Silicon Image Semtech HDMI standard digital Analog ICs for transmission power supplies SiliconCore Technology Laser diode driver Mercury High-speed DSP SiBEAM Wireless HD transmission Gr
Slide 30: Embedded Software Development (IT Access)
Embedded Software Development (IT Access) Expansion of Focus on server-side business Customer Base Custom Improved development for in-vehicle technologies / Development Identifying collaboration partners Business Expanding solutions for the growing video market Domain One-Stop Solutions Data Browser
Slide 31: Focus on Advanced Service
Focus on Advanced Service Gross Profit [Billion Yen] 10 Advanced Service Others 5 78％ 51％ 0 FY2004 FY2005 FY2006 FY2007 FY2008 31
Slide 32: Note for Forward Looking Statements
Note for Forward Looking Statements The information provided in this presentation includes forward looking statements based on current expectations, forecasts or beliefs. Such forward looking statements include a number of preliminary assumptions about future events that are subject to factors and u