JTEKT Corporation · TSE:6473

JTEKT — Q2 FY2021 Earnings Presentation

49 slides from JTEKT's earnings presentation, Nov 10, 2021

  1. Slide 1: IR Presentation for the Second Quarter of Fiscal Year Ended March 2022

    IR Presentation for the Second Quarter of Fiscal Year Ended March 2022 November 10, 2021 1 JTEKT CORPORATION

  2. Slide 2: Financial points

    Financial points １．In the second quarter (July-September), although sales were lower than expected due to the impact of production cuts, profits above the published value were secured due to the results of the efforts to improve profitability. In the cumulative second quarter (April-September), busi

  3. Slide 3: Agenda

    １．Results for the Second Quarter of Fiscal Year Ended March 2022 P４ ２．Forecasts for Fiscal Year 2021, Ending March 2022 P１１ ３．Priority Initiatives P１６ ４．Appendix P３０ ４-１．Management indicators P３０ ４-２．Changes in fixed costs P３２ ４-３．Financial statements P３３ ４-４．Quarterly Result Trend（by Region / Busin

  4. Slide 4: 1-1) Consolidated Performance

    1-1） Consolidated Performance ■ Although there was an impact of production cuts, sales increased in all businesses and regions due to the recovery of the market environment compared to the previous year. ■ Although material and transportation costs have increased, the constitution has steadily impro

  5. Slide 5: 1-2) Quarterly Result Trend

    1-2） Quarterly Result Trend ■ Revenue decreased from the first quarter results and the second quarter forecast due to production cuts, and decreased year-on-year. ■ Business profit is about the same as the same period of the previous year as we continue to work on improving our constitution despite

  6. Slide 6: 1-3) Business Profit Analysis

    1-3）Business Profit Analysis Unit：billion of yen External procurement costs +3.2 Productivity improvement +3.0 Material cost ▲4.4 Logistics cost ▲1.3 Labor cost ＋1.0 R & D expenses ＋1.2 Repair costs －1.2 other expenses ＋0.3 Earning structure ＋4.8 6 JTEKT CORPORATION

  7. Slide 7: 1-4) Results by Region

    1-4）Results by Region Sales revenue Business profit Unit：billion of yen [Rate of change] FY20 2Q FY21 2Q Unit：billion of yen (Ratio to Revenue) FY20 2Q FY21 2Q Currency Currency Increase / Increase / decrease difference difference decrease ＋43.0 [＋18.6%] Japan - +43.0 ＋18.6% Japan ＋2.0 ＋22.6 Europe

  8. Slide 8: 1-5) Results by Region (North America, Europe)

    1-5）Results by Region (North America, Europe) North America Europe Although there is a decrease in sales and soaring Productivity continues to deteriorate due to labor material costs, the amount of decrease in profits is shortage, and profitability deteriorate due to suppressed by reducing personnel

  9. Slide 9: 1-6) Result by Business

    1-6）Result by Business Sales revenue Business profit Unit：billion of yen [Rate of change] FY20 2Q FY21 2Q Unit：billion of yen (Ratio to Revenue) FY20 2Q FY21 2Q Currency Increase / Currency Increase / ＋72.7 difference decrease difference decrease Steering 14.6 58.1 ＋23.6% Steering 1.1 11.4 [＋29.6%]

  10. Slide 10: Agenda

    １．Results for the Second Quarter of Fiscal Year Ended March 2022 P４ ２．Forecasts for Fiscal Year 2021, Ending March 2022 P１１ ３．Priority Initiatives P１６ ４．Appendix P３０ ４-１．Management indicators P３０ ４-２．Changes in fixed costs P３２ ４-３．Financial statements P３３ ４-４．Quarterly Result Trend（by Region / Busin

  11. Slide 11: 2-1) Forecasts for Fiscal Year Ending March 2022

    2-1）Forecasts for Fiscal Year Ending March 2022 Although the outlook is uncertain due to production cuts / recovery production due to semiconductor shortages and soaring materials / transportation costs, the full-year forecast will remain unchanged by improving the constitution by reducing costs and

  12. Slide 12: 2-2) Forecasts - Business profit Analysis

    2-2）Forecasts － Business profit Analysis Unit：billion of yen -11.0 Cost increase -18.5 -7.5 Earning structure -0.5 12 JTEKT CORPORATION

  13. Slide 13: 2-3) Forecasts - by Region

    2-3） Forecasts － by Region Sales revenue Business profit Unit：billion of yen [Rate of change] 21/3 22/3 Unit：billion of yen (Ratio to Revenue) 21/3 22/3 Currency Increase / decrease Currency Increase / difference decrease Japan - ＋42.2 ＋7.9% Japan ＋3.8 ＋17.4 ＋42.2 Europe ＋8.6 ＋10.4 ＋6.9% Europe -0.6

  14. Slide 14: 2-4) Forecasts - by Business

    2-4）Forecasts － by Business Sales revenue Business profit Unit：billion of yen [Rate of change] 21/3 22/3 Unit：billion of yen (Ratio to Revenue) 21/3 22/3 Currency Currency Increase / Increase / decrease difference decrease difference ＋85.5 Steering 23.1 62.4 ＋10.3% Steering 2.0 2.9 [＋14.1%] Drivelin

  15. Slide 15: Agenda

    １．Results for the Second Quarter of Fiscal Year Ended March 2022 P４ ２．Forecasts for Fiscal Year 2021, Ending March 2022 P１１ ３．Priority Initiatives P１６ ４．Appendix P３０ ４-１．Management indicators P３０ ４-２．Changes in fixed costs P３２ ４-３．Financial statements P３３ ４-４．Quarterly Result Trend（by Region / Busin

  16. Slide 16: 3) Important Initiatives

    3） Important Initiatives  The 1st year of the stage for strengthening JTEKT’s foundations • Improvement of break-even point consolidation of subsidiaries and affiliates 1. Surgical treatment • Progress of European structural reform, Moving head office • Changed directors‘ organization, Strengthened

  17. Slide 17: 3-1-1) Important Initiatives - Surgical treatment

    3-1-1）Important Initiatives – Surgical treatment  Corporate constitution was firmly improved by reducing cost and fixed cost  Improving efficiency by consolidation of subsidiaries Improvement of break- Consolidation of even point subsidiaries and affiliates • Restrain rebound from last year • From

  18. Slide 18: 3-1-2) Progress of European structural reform

    3-1-2）Important Initiatives – Surgical treatment  In Europe corporate constitution was improved by firmly promotion of structural reform, so having prospect of positive balance in FY 2023. Progress of European structural reform • Although in first half of year term we were affected by decrease of p

  19. Slide 19: 3-1-3) Important Initiatives - Surgical treatment

    3-1-3）Important Initiatives – Surgical treatment  We moved head office functions to Kariya in Aichi prefecture in order to strengthen cooperation with Toyota Group Moving head office, strengthening corporation of Toyota Group • On December 2020 we moved head office function from Nagoya to Kariya, o

  20. Slide 20: 3-2-1) Important Initiatives - Medical treatment

    3-2-1） Important Initiatives – Medical treatment  Toward achieving medium-term business plan, we discussed managing subject with viewing overall optimization. Changed directors' organization • On January 2021 we introduced a senior executive officer system to speed up decision making by flat and sl

  21. Slide 21: 3-2-1) Important Initiatives - Medical treatment

    3-2-1） Important Initiatives – Medical treatment Strengthened group governance • We established Global Business Strategy Dept. and Affiliated Companies Management Group and strengthened managing function of domestic and overseas group companies • We shared subject of group having the same goal on va

  22. Slide 22: 3-2-2) Important Initiatives - Medical treatment

    3-2-2） Important Initiatives – Medical treatment  Expand business by synergy between business and strengthen JTEKT furthermore Gear Business Bearing for offshore wind • We combine strength of analyzing power generation technology cultivated in car component, • We develop new product for spindle bea

  23. Slide 23: 3-2-3) Important Initiatives - Medical treatment

    3-2-3） Important Initiatives – Medical treatment  From sales for each business / each company to sales with all group together  Final goal of sales reform is to become salesperson that customer can count on ① Adaptation doing sales by area ③ Cross sales • We eliminate walls between industry • make

  24. Slide 24: 3-3) Important Initiatives - Chinese Medicine Treatment

     3-3）Important Initiatives －“Chinese Medicine Treatment”  Getting started in “Chinese Medicine Treatment”  Increase the number of people who can act based on “JTEKT’s version of the basic principles of TQM”. “Passion” and “Dialogue” Strengthen the TQM Promotion Dept. through internal recruitment

  25. Slide 25: 3-4-1) Important Initiatives - Digital Transformation

     3-4-1） Important Initiatives －Digital Transformation  Select representatives from each area of our company’s value chain, DX promotion Dept. are drawing a roadmap of where the JTEKT Group wants to be in 10years from now from the perspective of total optimization.  At the same time, promote the u

  26. Slide 26: 3-4-2) Important Initiatives - Carbon Neutral

     3-4-2）Important Initiatives －Carbon Neutral  Established the Carbon Neutral Strategy Office in August as an organization under the direct control of the president.  Achieve CN not only by reducing CO2 emissions from business activities, but also by developing next-generation products 【Scope1+2】

  27. Slide 27: 3-5-1) Improve profitability of each business

    3-5-1）Important Initiatives －Improve profitability of each business ■Until the automotive business recovers in earnest, JTEKT earn money in each inherited business (bearings and machine tools) Industrial and Bearing Machine Tools & Manufacturing Automotive Business Unit Business Unit Systems Busines

  28. Slide 28: 3-5-2) Initiatives for the Future

    3-5-2） Important Initiatives －Initiatives for the Future  Contribute to the resolution of social issues and the realization of a sustainable society. Response Electrification to Carbon-Neutrality Lithium ion Capacitors Formic acid fuel cells • To be used as a back-up power device for • A system tha

  29. Slide 29: Agenda

    １．Results for the Second Quarter of Fiscal Year Ended March 2022 P４ ２．Forecasts for Fiscal Year 2021, Ending March 2022 P１１ ３．Priority Initiatives P１６ ４．Appendix P３０ ４-１．Management indicators P３０ ４-２．Changes in fixed costs P３２ ４-３．Financial statements P３３ ４-４．Quarterly Result Trend（by Region / Busin

  30. Slide 30: 4-1) Inventories / Interest-bearing debt, Cash reserves

    4-1）Inventories／Interest-bearing debt・Cash reserves Inventories Interest-bearing debt, Cash reserves Inventory turnover month Left bar Interest-bearing debt NET DE ratio Right bar Cash reserves 1.6 1.8 1.8 0.38 1.4 1.4 0.29 0.29 0.30 0.24 206.0 328.1 Unit：billion of yen 190.8 Unit：billion of yen 183

  31. Slide 31: 4-1) Cash flows / ROE, ROA

    4-1）Cash flows／ROE・ROA Cash flows ROE, ROA Upper row Sales C/F Unit：billion of yen FreeC/F ROE ROA Lower row Investment C/F 0.9 27.6 39.2 35.9 -29.4 9.7 100.0 103.0 91.7 62.3 37.6 4.6 4.2 3.7 1.9 -1.7 1.6 ▲0.3 0.2 0.1 -52.5 ▲0.7 -75.3 -99.0 -91.7 FY2017 FY2018 FY2019 FY2020 FY2021 FY2017 FY2018 FY20

  32. Slide 32: 4-2) Changes in fixed costs

    4-2）Changes in fixed costs Depreciation and Research and Capital expenditures amortization development expenses Upper row July - March Unit：billion of yen Unit：billion of yen Ratio to Revenue Unit：billion of yen Lower row April - June 4.6% 4.2% 4.2% 3.8% 3.8% 75.2 75.0 66.6 64.3 64.6 63.0 64.0 63.6

  33. Slide 33: 4-3) Consolidated Statements of Financial Position

    4-3）Consolidated Statements of Financial Position Assets Liabilities and equity Unit：billion of yen Unit：billion of yen Increase / Liabilities and Increase / Assets 21/3 21/9 21/3 21/9 decrease decrease equity Cash and cash Trade and other 118.6 160.7 +42.1 286.6 257.8 -28.7 equivalents payables Tra

  34. Slide 34: 4-3) Consolidated Statements of Income / Cash Flow

    4-3）Consolidated Statements of Income ／ Consolidated cash flow statement Consolidated Statements of Income Consolidated cash flow statement Unit：billion of yen Unit：billion of yen Increase / Increase / 20/9 21/9 decrease 20/9 21/9 decrease Sales revenue 520.2 664.1 +143.9 Cash flows from -1.5 37.6 +

  35. Slide 35: 4-4) Quarterly Result Trend - Japan

    4-4）Quarterly Result Trend－Japan Sales revenue Business profit Unit：billion of yen Unit：billion of yen ● Ratio to Revenue 7.3% 153.4 153.1 4.5% 2.8% 1.7% 11.1 2.2% 139.4 138.7 135.3 6.9 3.0 3.7 2.4 91.6 -22.1% -20.3 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q FY2020 FY2021 FY2020 FY2021 35 JTEKT

  36. Slide 36: 4-4) Quarterly Result Trend - Europe

    4-4）Quarterly Result Trend－Europe Sales revenue Business profit Unit：billion of yen Unit：billion of yen ● Ratio to Revenue 0.9% -2.0% -4.0% -4.4% 0.4 -8.1% 46.3 46.1 42.8 39.4 33.1 -0.9 -1.5 -1.8 -2.6 18.9 -5.1 -27.0% 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q FY2020 FY2021 FY2020 FY2021 36 JTE

  37. Slide 37: 4-4) Quarterly Result Trend - North America

    4-4）Quarterly Result Trend－North America Sales revenue Business profit Unit：billion of yen Unit：billion of yen ● Ratio to Revenue 3.5% 3.2% 73.3 1.1% 68.4 68.5 70.2 65.4 2.3 2.2 -0.6% 0.7 -3.6% -0.4 32.1 -2.3 -20.2% -6.5 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q FY2020 FY2021 FY2020 FY2021 37

  38. Slide 38: 4-4) Quarterly Result Trend - China

    4-4）Quarterly Result Trend－China Sales revenue Business profit Unit：billion of yen Unit：billion of yen ● Ratio to Revenue 10.4% 9.3% 9.5% 9.3% 7.9% 45.7 7.2% 43.7 39.6 38.4 37.2 38.1 4.7 3.7 4.0 3.4 2.7 3.0 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q FY2020 FY2021 FY2020 FY2021 38 JTEKT CORPORAT

  39. Slide 39: 4-4) Quarterly Result Trend - Asia & Others

    4-4）Quarterly Result Trend－Asia & Others Sales revenue Business profit Unit：billion of yen Unit：billion of yen ● Ratio to Revenue 12.7% 10.4% 10.8% 8.7% 5.8% 6.9 5.1 5.1 54.9 3.9 49.1 47.6 45.4 2.1 37.9 15.2 -3.4 -22.9% 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q FY2020 FY2021 FY2020 FY2021 39 J

  40. Slide 40: 4-4) Quarterly Result Trend - Automotive

    4-4）Quarterly Result Trend－Automotive (Steering＋Drivelines, including Hub unit) Sales revenue Business profit Unit：billion of yen Unit：billion of yen ● Ratio to Revenue 256.0 246.8 237.3 5.3% 6.2% 220.2 205.8 2.5% 1.8% 15.2 13.4 5.6 4.2 -0.5% 122.5 -0.9 -21.3 -17.4% 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q

  41. Slide 41: 4-4) Quarterly Result Trend - Industrial & Bearings Business

    4-4）Quarterly Result Trend－Industrial & Bearings Business (Hub unit not included） Sales revenue Business profit Unit：billion of yen Unit：billion of yen ● Ratio to Revenue 6.6% 6.1% 5.1% 3.7% 5.2 79.6 77.3 -1.3% 3.9 4.4 74.6 74.0 2.7 69.3 46.6 -0.9 -7.5 -16.3% 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2

  42. Slide 42: 4-4) Quarterly Result Trend - Machine tools and others

    4-4）Quarterly Result Trend－Machine tools and others Sales revenue Business profit Unit：billion of yen Unit：billion of yen ● Ratio to Revenue 7.0% 40.0 4.7% 4.9% 35.2 36.2 2.8 32.6 29.3 1.6 1.7 26.0 1.7% 0.6% 0.4 0.1 -5.6% -1.4 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q FY2020 FY2021 FY2020 FY20

  43. Slide 43: 4-4) Quarterly Result Trend - Steering

    4-4）Quarterly Result Trend－Steering Sales revenue Business profit Unit：billion of yen Unit：billion of yen ● Ratio to Revenue 6.3% 4.6% 2.2% 1.1% 183.8 11.2 178.0 170.6 8.5 157.8 -0.1% 148.1 3.4 1.9 -0.1 88.1 -16.2% -14.2 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q FY2020 FY2021 FY2020 FY2021 43

  44. Slide 44: 4-4) Quarterly Result Trend - Drivelines

    4-4）Quarterly Result Trend－Drivelines （Including Hub unit) Sales revenue Business profit Unit：billion of yen Unit：billion of yen ● Ratio to Revenue 6.8% 5.7% 3.5% 4.9 3.5% 72.1 3.9 68.7 66.7 62.4 2.1 2.3 57.7 -1.4% 34.4 -0.8 -20.4% -7.0 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q FY2020 FY2021 F

  45. Slide 45: 4-4) Quarterly Result Trend - Machine tools

    4-4）Quarterly Result Trend－Machine tools (Others excluded) Sales revenue Business profit Unit：billion of yen Unit：billion of yen ● Ratio to Revenue 8.9% 39.8 6.5% 35.5 5.7% 3.5 34.7 32.4 29.2 2.3 25.6 1.9 2.7% 1.5% 0.7 0.4 -3.8% 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q -0.9 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q FY2020 FY2021 FY20

  46. Slide 46: 4-5) Business profit Analysis - Steering / Drivelines

    4-5） Business profit Analysis－Steering／Drivelines Unit：billion of yen Steering Earning structure ＋2.0 Unit：billion of yen ※Including Hub unit Drivelines Earning structure +0.1 ※ 46 JTEKT CORPORATION

  47. Slide 47: 4-5) Business profit Analysis - Bearing / Machine tools

    4-5） Business profit Analysis － Bearing／Machine tools Mechatronics Business Units Unit：billion of yen ※Hub unit not included Bearing Earning structure ＋3.7 ※ Unit：billion of yen ※Other products not included Mechatronics Business Units Machine tools Earning structure ＋0.4 ※ ※ 47 JTEKT CORPORATION

  48. Slide 48: 4-6) Return to Shareholders

    4-6）Return to Shareholders Dividend payout ratio (%) 61.2 685.2 41.1 39.5 26.9 26.3 27.4 29.6 30.3 29.7 26.1 13.50 17.7 Shareholders - - - Return to 30% 42 42 43 44 Upper row Year-end dividend Unit：yen per share 38 Lower row Interim dividend 34 24 21 21 22 22 16 19 17 18 20 16 16 16 16 16 13 11 10 6

  49. Slide 49: Note on forward-looking statements

    【Note on forward-looking statements】 This report contains forward-looking statements pertaining to future plans and strategies. These forward-looking statements include risks, uncertainties and other factors, and actual results and business results may differ from those stated. 49 JTEKT CORPORATION

JTEKT — Q2 FY2021 Earnings Presentation on 6ix