Slide 1: ESPEC CORP. Results Briefing FY2024
Securities ID code: 6859 ESPEC CORP. Results Briefing FY2024 (Fiscal Year Ended March 31, 2025) May 26, 2025 Representative Director and President Satoshi Arata
Slide 2: Contents
pp. 1–21 FY2024 Full-Year Results pp. 22–46 Medium-Term Management Plan PROGRESSIVE PLUS 2027 pp. 47–56 FY2025 Plan Reference materials • Company Profile & Business Overview • Sustainability Initiatives
Slide 3: FY2024 Full-Year Results
FY2024 Full-Year Results ESPEC CORP. 1
Slide 4: FY2024 Full-Year Financial Summary
FY2024 Full-Year Financial Summary Orders received, net sales, and profit all reached record highs, mainly due to continued investment in the domestic EV and battery markets and enhanced domestic production capacity. Achieved medium-term management targets ahead of schedule and announced a new mediu
Slide 5: Summary of Profits and Losses
Summary of Profits and Losses (Millions of yen) FY2024 Revised Comparison Comparison FY2024 Initial FY2023 Results Forecasts FY2024 Results Year on Year with Initial with March Forecasts (Mar. 2025) Forecasts Forecasts Orders Received 62,290 63,000 66,700 67,514 +8.4% +7.2% +1.2% Net Sales 62,126 65
Slide 6: Performance by Segment
Performance by Segment (Millions of yen) FY2024 Comparison Comparison FY2023 FY2024 Initial Revised FY2024 Forecasts Year on Year with Initial with March Results Forecasts Results Forecasts Forecasts (Mar. 2025) Orders Received 53,565 53,700 56,600 57,283 +6.9% +6.7% +1.2% Equipment Business Net sal
Slide 7: Orders Received in FY2024
Orders Received in FY2024 ■ Orders received marked a new record high for the fourth consecutive fiscal year. Orders increased particularly in Japan, as well as North America and China; remained flat in South Korea and Taiwan, and decreased in Southeast Asia and Europe. Orders Received (Millions of y
Slide 8: Net Sales in FY2024
Net Sales in FY2024 ■ Net sales renewed record highs for the third consecutive fiscal year. Sales increased particularly in Japan and North America, as well as Southeast Asia, South Korea, and Taiwan; were level year on year in China, and decreased in Europe. Net sales (Millions of yen) 80,000 70,00
Slide 9: Operating Profit and Profit Ratio in FY2024
Operating Profit and Profit Ratio in FY2024 ■ Operating profit renewed record highs for the second consecutive fiscal year. Profitability improved due to sales growth and cost of sales ratio improvement Operating Profit and Profit Ratio (Millions of yen) 10,000 12.0% 11.2% 10.6% 10.0% 8,000 7,526 8.
Slide 10: Analysis of Operating Profit Increase and Decrease Factors
Analysis of Operating Profit Increase and Decrease Factors ■ Profit increased mainly due to sales increase in the Equipment and Service Businesses and improved cost of sales ratio in Equipment Business. (Millions of yen) Equipment Business Service Business 242 22 Other Business 339 90 -87 1,390 -424
Slide 11: Statement of Assets and Liabilities
Statement of Assets and Liabilities ■ Although there was an increase in trade receivables due to expanded sales and an increase in fixed assets from capital investments, the repayment of short-term borrowings resulted in total assets decrease of approximately ¥2.4 billion. Assets Liabilities and Net
Slide 12: Statements of Cash Flows
(Millions of yen) 10 -4,027 Increase (decrease) in funds ■ Operating CF resulted in a cash inflow of approximately ¥4.4 billion, but capital investment and -74 Effect of exchange rate changes -7,245 Total financial cash flow repayment of short-term borrowings led to a net cash decrease of about ¥4.0
Slide 13: Equipment Business
Equipment Business (Millions of yen) FY2024 Revised Comparison Comparison FY2024 Initial Forecasts FY2024 FY2023 Results Year on Year with Initial with March Forecasts Results (Mar. 2025) Forecasts Forecasts Orders Received 53,565 53,700 56,600 57,283 +6.9% +6.7% +1.2% Net sales 53,518 56,000 56,900
Slide 14: Service Business
Service Business (Millions of yen) FY2024 Revised Comparison Comparison FY2023 FY2024 Initial Forecasts FY2024 Results Year on Year with Initial with March Results Forecasts (Mar. 2025) Forecasts Forecasts Orders Received 7,634 8,000 8,400 8,532 +11.8% +6.7% +1.6% Net sales 7,536 7,900 8,300 8,425 +
Slide 15: Other Business
Other Business (Millions of yen) FY2024 Revised Comparison Comparison FY2024 Initial FY2023 Results Forecasts FY2024 Results Year on Year with Initial with March Forecasts (Mar. 2025) Forecasts Forecasts Orders Received 1,453 1,700 2,100 2,170 +49.3% +27.7% +3.4% Net sales 1,455 1,500 1,700 1,758 +2
Slide 16: Sales by Market
Sales by Market ■ The Electronic device and equipment market remained at the same level as the previous year. Sales related to EV and battery applications progressed, increasing the share of the automobile market, including car electronics. Non-consolidated (Equipment Business) 100% 100% Electronic
Slide 17: Sales by Region
Sales by Region ■ Sales in Japan increased, raising the domestic share, while overseas growth was driven mainly by higher sales in North America. FY2023 FY2024 Overseas sales ratio: 53.1% Overseas sales ratio: 51.9% 9,504 North America 11,187 15.3% 3,406 Europe 16.6% 2,919 5.5% China 4.3% 29,162 32,
Slide 18: Main Initiatives for ESG in FY2024
Main Initiatives for ESG in FY2024 ■ E (Environment) Promote global warming countermeasures and biodiversity conservation activities under the 8th Medium-Term Plan on the Environment (FY2022–2025) • Launch environmentally friendly products, including constant temperature and humidity chambers using
Slide 19: Basic Policy on Dividends and Results
Basic Policy on Dividends and Results Basic Policy on Dividends * May 15, 2025, announced revision to the Basic Policy on Dividends (p. 44) In addition to a dividend payout ratio of 30%, we will add dividends with 1/3 of the excess funds as a baseline. While reflecting a necessary level of internal
Slide 20: TOPICS 1
TOPICS 1 Start of “Aichi Next-Generation Mobility Test Lab” service Responding to testing demand for automotive batteries and EV/automation modules ■ Aichi xEV Battery Safety Test & ■ Toyota Test Center Certification Center • Expanded functions of the Toyota Testing Center, the Company’s largest int
Slide 21: TOPICS 2
TOPICS 2 Responding to testing demand in AI and Launched low temperature (& humidity) chambers autonomous driving fields Platinous J Series ECO Type with low-GWP refrigerant Rapid-Rate Thermal Cycle Chamber • In April 2025, a high-performance model capable • In November 2024, launched the ECO Type i
Slide 22: TOPICS 3
TOPICS 3 First domestic launch by COSMOPIA -70C Ultra-Low Temperature Shock Freezer HIGHTECH of a rapid temperature change for delicious rapid freezing device using low-GWP refrigerant • In April 2025, launched the “Ultra-Low Temperature • In October 2024, COSMOPIA HIGHTECH, part of Shock Freezer”
Slide 23: External Recognition
External Recognition ■ ESG-Related Evaluations • Included in the ESG index “FTSE Blossom Japan Sector Relative Index” • Rated “B” score for the fifth consecutive year in the CDP Climate Change Survey, “B-” score for Water Security Selected as Supplier Engagement Leader for two consecutive years, the
Slide 24: Medium-Term Management Plan PROGRESSIVE PLUS 2027
Medium-Term Management Plan PROGRESSIVE PLUS 2027 Implementation period: FY2025–2027 22
Slide 25: Impact of and Response to U.S. Reciprocal Tariff Policies
Impact of and Response to U.S. Reciprocal Tariff Policies • The Company has a subsidiary in the U.S., with over 80% of production conducted locally. Exports from Japan account for only a few percent of consolidated net sales, and there is little trade between the U.S. and China. Therefore, the direc
Slide 26: PROGRESSIVE PLAN 2025 Early Achievement
PROGRESSIVE PLAN 2025 Early Achievement Implemented a Medium-Term Management Plan divided into four-year stages (Stage I to III) in working toward the realization of ESPEC Vision 2025. The Stage III plan, “PROGRESSIVE PLAN 2025,” achieved its targets in FY2024, one year ahead of schedule. Stage III
Slide 27: PROGRESSIVE PLAN 2025 Targets and Results
PROGRESSIVE PLAN 2025 Targets and Results Stage Ⅰ Stage II Stage III PROGRESSIVE PLAN 2017 PROGRESSIVE PLAN 2021 PROGRESSIVE PLAN 2025 (Millions of yen) Net sales 売上高 65,000 営業利益 Operating profit 67,288 62,126 営業利益率 Profit ratio 52,892 50,580 (47,060) 44,069 42,443 41,852 39,035 39,507 38,668 33,661
Slide 28: PROGRESSIVE PLAN 2025 Results and Challenges
PROGRESSIVE PLAN 2025 Results and Challenges Strategy Result Summary/Management Challenges • Orders received for development and production applications in the EV and battery sectors Equipment Business • Improved domestic competitiveness of customized products • Expand new products for advanced tech
Slide 29: Recognition of the Operating Environment Toward 2027 (SWOT)
Recognition of the Operating Environment Toward 2027 (SWOT Analysis) Plus Factors Minus Factors [Strengths] [Weaknesses] Internal Environment • Top shares (Global: 30%, Japan: 60% or more) • Decline in operational efficiency due to rapid • Brand strength in the environmental testing order expansion
Slide 30: PROGRESSIVE PLUS 2027 Basic Policy and Targets
PROGRESSIVE PLUS 2027 Basic Policy and Targets Establishing a lean, sustainable, and highly profitable earnings model Aiming to continuously increase our value as a corporate group by becoming a “lean enterprise,” which we will achieve through quality improvements and profit growth. ■ Target markets
Slide 31: PROGRESSIVE PLUS 2027 Three Strategies
PROGRESSIVE PLUS 2027 Three Strategies To enhance corporate value, the Company will execute business strategies, financial capital strategies, and non-financial strategies, along with proactive growth investments and shareholder returns. Increase Corporate Value 1. Business 2. Financial Capital 3. N
Slide 32: PROGRESSIVE PLUS 2027 Positioning
PROGRESSIVE PLUS 2027 Positioning A three-year period looking ahead to the next decade, aiming for an operating profit ratio of 15% Laying the foundation for further growth Net sales (Millions of yen) 売上高 Three years of profit growth ESPEC Vision Operating profit 営業利益 Profit ratio 営業利益率 68,000 70,00
Slide 33: Target Markets
Target Markets • Expected slowdown in investments in EVs and batteries • AI semiconductors, autonomous driving, and satellite communications, where testing demand is expected to increase with the practical application of advanced technologies, will be the target markets ■ Targeted advanced technolog
Slide 34: Testing Demand in the AI Semiconductor and Server Market
Testing Demand in the AI Semiconductor and Server Market (10 billion dollars) As generative AI spreads across society, development is 140 130.4 accelerating in advanced technology fields such as 120 107.9 semiconductors, data centers, storage, electronic 100 89.7 components, and electronic materials
Slide 35: Testing Demand in Autonomous Driving Market
Testing Demand in Autonomous Driving Market Active development by automotive manufacturers aiming for 1.1 (Billions of units) vehicle electrification and intelligence, including software- LiDAR defined vehicles (SDVs*). Sensing cameras In sensors used in autonomous driving, such as integrated Surrou
Slide 36: Testing Demand in the Satellite Communications Market
Testing Demand in the Satellite Communications Market （100 million yen） Targeting the commercial satellite communications technologies under development by private companies in the U.S. and Japan. Use and adaptation of consumer-grade components is expected to increase since satellite communications
Slide 37: Image of Achieving the FY2027 Operating Profit Target
Image of Achieving the FY2027 Operating Profit Target •Offset the slowdown in investment for EVs and batteries by capturing demand in the fields of AI semiconductors, autonomous driving, and satellite communications •Improve gross profit margin through enhanced product value and more efficient manuf
Slide 38: Medium-Term Management Targets by Business Segment
Medium-Term Management Targets by Business Segment (Millions of yen) Business Segment FY2024 Results FY2027 Targets Growth Rate Equipment Business 57,507 58,550 +1.8% Service Business 8,425 10,200 +21.1% Net sales Other Business 1,758 1,800 +2.4% Elimination -403 -550 - Total 67,288 70,000 +4.0% 6,6
Slide 39: 1-1. Equipment Business Strategy
1-1. Equipment Business Strategy Medium-Term Management Targets Net sales (Millions of yen) 売上高 Operating profit 営業利益 •In environmental test chambers, compensate for 営業利益率 Profit ratio the slowdown in investment related to EVs and 58,550 +2% batteries by capturing testing demand in target 57,507 mar
Slide 40: 1-2. Global Strategy
1-2. Global Strategy Leverage the Group’s overall strengths to establish competitive advantages in each region ■ Target Markets by Region • Semiconductors • Automobiles • Communications • Semiconductors • Communications • AI semiconductors Europe China South Korea U.S. Taiwan Japan India ASEAN • Aut
Slide 41: 1-3. Monozukuri (manufacturing) Strategy
1-3. Monozukuri (manufacturing) Strategy Proactively driving labor-saving and automation at the Fukuchiyama Plant (Kyoto Pref.) by leveraging AI and IoT to enhance manufacturing efficiency • Optimization of the value chain by connecting all processes through digital technologies • Shortening product
Slide 42: 1-4. Service Business Strategy
1-4. Service Business Strategy Medium-Term Management Targets Net sales (Millions of yen) 売上高 • In laboratory testing services, expand sales 営業利益 Operating profit Profit ratio 10,200 centering on the “Aichi Next-Generation 営業利益率 +21% Mobility Test Lab,” opened in February 2025 8,425 14.7% +5.3 pt •
Slide 43: 1-5. New Business Strategy
1-5. New Business Strategy Creation of new businesses to serve as future revenue pillars ■ Expansion of thermal solution services (commissioned thermal measurement and CAE analysis services) Contribute to shortening customers’ development timelines Support improved accuracy in thermal design and the
Slide 44: 2-1. Financial Capital Strategy
2-1. Financial Capital Strategy Cash Allocation Policy Proactively allocate cash generated over three years to growth investments and shareholder returns ■ Implement shareholder returns with a total return ratio of 50% (cumulative over 3 years) or more through dividends and share purchases by the Co
Slide 45: 2-2. Investment Plans
2-2. Investment Plans FY2022–2024 (3 years) FY2025–2027 (3 years) Growth Rate Results Plans Over 3 Years Regular Investment ¥3.5 billion ¥2.5 billion -29% Strategic Investment ¥6.0 billion ¥7.0 billion +17% Total Growth Investment ¥9.5 billion ¥9.5 billion - R&D Expenses ¥3.6 billion ¥4.8 billion +3
Slide 46: 2-3. Shareholder Return Policy
2-3. Shareholder Return Policy Disclosed on May 15, 2025 With the formulation of the Medium-Term Management Plan PROGRESSIVE PLUS 2027, the basic policy on dividends was revised and the name of the policy was changed to clarify the policy of strengthening shareholder returns, not only through divide
Slide 47: 2-4. Management Conscious of Cost of Capital and Share Price
2-4. Management Conscious of Cost of Capital and Share Price Disclosed on May 15, 2025 Under the Medium-Term Management Plan PROGRESSIVE PLUS 2027 ROE target is raised from 10% to 12% or higher, and initiatives are strengthened Policies • Aim to achieve (net sales of ¥70.0 billion, operating profit
Slide 48: 3. Non-financial Strategies (ESG)
3. Non-financial Strategies (ESG) Main Initiatives Medium-Term Management Plan Targets Environment • Promote global warming prevention and biodiversity conservation under the 8th Medium-term Plan on the • Greenhouse gas emissions (compared to FY2019) Environment (FY2022–2025) Scope 1+2: 55% reductio
Slide 49: FY2025 Plan
FY2025 Plan ESPEC CORP.
Slide 50: Key Points of FY2025 Plan
Key Points of FY2025 Plan • As the first year of the Medium-Term Management Plan PROGRESSIVE PLUS 2027, implement growth strategies • Execute growth investment (enhancing manufacturing efficiency and new product development) and shareholder returns • Orders received are expected to decline in invest
Slide 51: FY2025 Recognition of the Operating Environment
FY2025 Recognition of the Operating Environment Although the global economic outlook is uncertain, investment in advanced technology development will continue. Japan: Investment related to EVs and batteries (mainly for production) is expected to decline, but investment in AI semiconductors and auton
Slide 52: Forecasts for FY2025
Forecasts for FY2025 (Millions of yen) FY2024 FY2025 Forecasts Full Year 1H 2H Full Year Year on Year Results Orders Received 67,514 33,500 32,500 66,000 -2.2% Net sales 67,288 31,000 37,000 68,000 +1.1% Gross Profit 23,987 11,500 13,900 25,400 +5.9% Profit Ratio 35.6% 37.1% 37.6% 37.4% +1.8 pt SG&A
Slide 53: Segment Financial Forecasts
Segment Financial Forecasts (Millions of yen) FY2024 FY2025 Forecasts Full Year Results 1H 2H Full Year Year on Year Orders Received 57,283 28,430 27,070 55,500 -3.1% Equipment Business Net sales 57,507 26,420 31,180 57,600 +0.2% Operating profit 6,610 2,910 4,430 7,340 +11.0% Orders Received 8,532
Slide 54: FY2025 Assumed Exchange Rate
FY2025 Assumed Exchange Rate ■ Assumed Exchange Rate FY2023 FY2024 FY2025 Full Year Full Year Results 1H Results Full Year Results Assumption U.S. dollar (yen) 144.59 152.77 152.62 145 Euro (yen) 156.74 166.05 163.87 160 Yuan (yen) 20.13 21.16 21.11 20 FY2025 exchange rate sensitivity * Impact of ¥1
Slide 55: FY2025 Investment Plans
FY2025 Investment Plans (Millions of yen) FY2024 FY2025 Forecasts Full Year 1H 2H Full Year Year on Year Results Capital Expenditures 3,690 920 1,670 2,590 -29.8% Depreciation 1,716 960 1,030 1,990 +15.9% R&D Expenses 1,343 1,010 820 1,830 +36.2% Main investments Main R&D activities • Enhancement of
Slide 56: Shareholder Return Policy and FY2025 Dividend Forecast
Shareholder Return Policy and FY2025 Dividend Forecast Shareholder Return Policy Set the consolidated dividend payout ratio at 40% or more, and flexibly carry out acquisition of treasury shares. During the period of the Medium-Term Management Plan PROGRESSIVE PLUS 2027 (FY2025–2027), the total retur
Slide 57: Main Initiatives in FY2025
Main Initiatives in FY2025 Equipment Business • Shortening product lead times by digesting order backlog and expanding in-house production • Development and expanded sales of high value-added products that meet testing needs in target markets Service Business After-sales service: Expansion of sales
Slide 58: FY2025 Main ESG Initiatives
FY2025 Main ESG Initiatives ■ E (Environment) • Promote the 8th Medium-Term Plan on the Environment (FY2022–2025) • Global warming countermeasure: Reduce CO2 emissions in business activities such as change to low-GWP refrigerant and manufacturing • Biodiversity conservation activities: Contribute th
Slide 59: Forward-looking statements and inquiries
These materials contain forward-looking statements, including the Company’s present plans and forecasts of performance, that reflect the Company’s plans and forecasts based on the information presently available. These forward-looking statements are not guarantees of future performance, and plans, f
Slide 60: Quality is more than a word
Quality is more than a word ESOEC ESPEC CORP.