Slide 1: Financial Conference: Consolidated Business Results and Forecast
FINANCIAL CONFERENCE Consolidated Business Results and Forecast May 14, 2010 NSK Ltd. Cautionary Statements with Respect to Forward-Looking Statements Statements made in this report with respect to plans, strategies and future performance that are not historical fact are forward-looking statements.
Slide 2: Contents
Contents 1. Consolidated Business Results for the Year Ended March 31, 2010 2. Consolidated Business Forecast for the Year Ending March 31, 2011 3. Progress of Mid-term Plan(FY’09~FY’12) (Supplementary Material) 1
Slide 3: 1. Consolidated Business Results for the Year Ended March 31, 2010
1. Consolidated Business Results for the Year Ended March 31, 2010 2
Slide 4: Summary of Consolidated Business Results for the Year Ended March 31, 2010
Summary of Consolidated Business Results for the Year Ended March 31, 2010 Business Environment ✓Industrial Machinery :Although demand showed an upward trend, the speed of recovery is still moderate. ✓Automotive Products: Automotive production recovered due to the positive effect of government stimu
Slide 5: Summary of Consolidated Business Results for the Year Ended March 31, 2010
Summary of Consolidated Business Results for the Year Ended March 31, 2010 （100 Million） 09/3 10/3 Increase/ decrease Difference ＜Actual＞ ＜Actual＞ YOY YOY Sales 6,476 5,876 -600 -9.3% Operating income 221 113 -108 -48.9% ＜%＞ ＜3.4%＞ ＜1.9%＞ Ordinary income 170 76 -94 -55.2% Extraordinary gain 5 - -5 -
Slide 6: Quarterly Business Performance
Quarterly Business Performance Sales Operating income/Margin Business results have been recovering In addition to profitability improvement quarter by quarter since 1Q. Demand initiatives, increased sales contributed to recovery from automakers contributed to results. Profitability improved rapidly
Slide 7: Results by Business Segment
Results by Business Segment （¥100 Million） 09/3 10/3 Increase/ Difference decrease ＜Actual＞ ＜Actual＞ YOY YOY Industrial bearings Sales 2,095 1,669 -426 -20.4% Operating income 195 <9.3%> 58 <3.5%> -137 -70.2% Automotive products Sales 3,525 3,664 139 +4.0% Automotive bearings 1,900 1,914 14 +0.7% Au
Slide 8: Quarterly Business Segment Performance
Quarterly Business Segment Performance Sales Operating income/Margin ■Industrial ■Automotive ■Precision ■Eliminations/ ■Industrial ■Automotive ■Precision ■Eliminations/ bearings products Machinery Corporate bearings products Machinery Corporate and Parts and Parts （¥100 Million） Million） 13.5% 13.1%
Slide 9: Operating Income: Factors Behind Decline (09/3 to 10/3)
Operating Income: Factors Behind Decline (09/3⇒10/3) (¥100 Million） 09/3 YOY Decrease of △108 221 Effect of volume decrease External 10/3 procurement cost △200 reduction etc. Decline in +110 113 △378 sales price Effect of Effect of Profitability exchange rate △55 fluctuations countermeasures 売価 Incr
Slide 10: Business Results by Customer Location
Business Results by Customer Location Increase/ Difference （100 Million） 09/3 10/3 decrease YOY YOY Sales 6,476 5,876 -600 -9.3% Japan 3,234 2,895 -339 -10.5% Non- Non-Japan 3,242 2,981 -261 -8.1% （Non- ratio） Non-Japan ratio） (50.1%) (50.7%) The Americas 787 706 -81 -10.3% Europe 1,119 985 -134 -11
Slide 11: Business Results by Geographical Segment
Business Results by Geographical Segment 【Japan】 【The Americas】 Increase/ Increase/ Difference Difference （100 Million） Million） 09/3 10/3 decrease YOY （100 Million） Million） 09/3 10/3 decrease YOY YOY YOY Sales 4,794 4,292 -502 -10.5% Sales 782 694 -88 -11. 11.3% Operating Operating income 66 <1.4%
Slide 12: Consolidated Balance Sheets
Consolidated Balance Sheets Assets Liabilities/Net Assets Net Assets Non- Non-Current Current Ratio of net worth Non- Non-current assets Current Assets to total capital liabilities liabilities (¥100 Million) Change YOY (¥100 Million) Change YOY 7,896 +454 7,442 7,896 +454 7,442 2,103 2,577 +474 3,69
Slide 13: Inventory/Interest-Bearing Debts/Capital Expenditure/Depreciation
Inventory/ Interest-Bearing Debts/ Capital Expenditure/ Depreciation Inventory Capital Expenditure Japan Non- Non-Japan Inventory turnover Japan Non- Non-Japan 6.2 （¥100 Million) （¥100 Million) 5.5 419 1,067 1,055 174 562 562 198 245 99 505 493 99 09/3 Year- Year-end 10/3 Year- Year-end 09/3 09/3 10
Slide 14: 2. Consolidated Business Forecast for the Year Ending March 31, 2011
2. Consolidated Business Forecast for the Year Ending March 31, 2011 13
Slide 15: Forecast for the Year Ending March 31, 2011
Forecast for the Year Ending March 31, 2011 Business Forecast ✓Net sales ¥665.0 billion Operating income ¥38.0 billion Ordinary income ¥33.0 billion Net income ¥21.0billion ✓Exchange rate forecast：US$=¥90.0 Euro=¥125.0 （09/3 1st half US$=¥92.83 Euro=¥130.89） ✓Dividend Forecast：¥10.0 /year（Interim:¥5
Slide 16: Forecast for the Year Ending March 31, 2011
Forecast for the Year Ending March 31, 2011 （¥100 Million） 10/3 Actual 11/3 Forecast Increase/ Difference decrease YOY 1st half 2nd half Full year 1st half 2nd half Full year YOY Sales 2,579 3,297 5,876 3,300 3,350 6,650 +774 +13.2% Operating -39 152 113 165 215 380 +267 +236.3% income ＜%＞ <-1.5%> <
Slide 17: Key Strategies for the Year Ending March 31, 2011
Key strategies for the Year Ending March 31, 2011 ■ Promote restructuring of global production sites Continue ■ Reduce external procurement costs profitability ■ Enhance countermeasures against risk of rising improvement steel price ■ Contain fixed costs by production efficiency countermeasures ■ Co
Slide 18: Change of Business Segment Disclosure
Change of Business Segment Disclosure Previous Revised 11/3~ Segment Segment Industrial Machinery Industrial Machinery Bearings Industrial Machinery Precision Machinery Bearings and Parts Automotive Products Enhance market-oriented business Automotive Products Precision Machinery structure and Parts
Slide 19: Forecast by Business Segment
Forecast by Business Segment （¥100 Million) 10/3 Actual 11/3 Forecast Increase/ Difference decrease YOY YOY 1st half 2nd half Full year 1st half 2nd half Full year Industrial Machinery Sales 898 1,122 2,020 1,185 1,220 2,405 +385 +19.1% Industrial machinery bearings 762 907 1,669 920 955 1,875 +206
Slide 20: Operating Income: Factors Behind Increase (10/3 to 11/3)
Operating Income: Factors Behind Increase (10/3⇒11/3) (¥100 Million） YOY Increase of 11/3 +267 Forecast External procurement cost reduction etc. 380 Effect of +70 Volume Increase 10/3 Decline in 113 sales price +320 +390 Effect of exchange rate △60 fluctuations △123 Increase in other costs △25 △38 1
Slide 21: Forecast by Customer Location
Forecast by Customer Location （¥100 Million） 10/3 Actual 11/3 Forecast Increase/ Difference decrease YOY YOY 1st half 2nd half Full year 1st half 2nd half Full year Sales 2,579 3,297 5,876 3,300 3,350 6,650 +774 +13.2% Japan 1,268 1,627 2,895 1,618 1,657 3,275 +380 +13.1% Non-Japan 1,311 1,670 2,981
Slide 22: Forecast by Geographical Segment
Forecast by Geographical Segment （¥100 Million） 10/3 Actual 11/3 Forecast Increase/ Difference decrease YOY 1st half 2nd half Full year 1st half 2nd half Full year YOY Japan Sales 1,875 2,417 4,292 2,530 2,570 5,100 +808 +18.8% Operating income -51 <-2.7%> 91 <3.8%> 40 <0.9%> 0.9%> 115 <4.6%> 145 <5
Slide 23: 3. Progress of Mid-term Plan (FY'09~FY'12)
3. Progress of Mid-term Plan(FY’09~FY’12) 22
Slide 24: Outline of the FY'09~FY'12 Mid-term Plan
Outline of the FY’09~FY’12 Mid-term Plan Transition of the Mid-term plan (FY’09~FY’12) Respond to paradigm shifts Reorganize business foundation, aiming towards a 1trillion yen company 《Outline of the Mid-term Plan》 《Numerical Targets》 Net Sales ¥780.0 billion 13/3 Forecast Operating Income Margin 8
Slide 25: Progress of the Mid-term Plan
Progress of the Mid-term Plan FY’09~FY’12 Mid term Plan 8.5% (¥100 Million) 5.7% 10,000 Operating Income margin 1,600 3.4% 1.4% 1.9% 7,800 8,000 6,650 1,200 6,476 5,700 5,876 6,000 660 800 4,000 Sales 380 400 2,000 221 80 113 Operating 0 Income 0 09/3 10/3 10/3 11/3 13/3 Actual Forecast Actual Forec
Slide 26: Mid-Term Plan Progress by Business Segment
Mid-Term Plan Progress by Business Segment Industrial Machinery Automotive products 4000 Sales Sales 5000 4,500 3,000 4,035 Precision 4000 3,525 3,664 3000 2,670 Automotive 2,405 Machinery 600 and Parts Components 2,300 575 2,020 3000 1,950 2000 530 1,625 1,750 351 2000 2,095 1,875 2,400 1000 1,669
Slide 27: Industrial Machinery Business: Industrial Machinery Bearings
Industrial Machinery Business① 《Industrial Machinery Bearings》 Expand sales in growing markets for profitability Implement intensive sales strategies ■Continue and strengthen sales ■Continue channel development activities for target sectors ＊Maintain expansion of sales Key fields distribution networ
Slide 28: Industrial Machinery Business: Precision Machinery and Parts
Industrial Machinery Business② 《Precision Machinery and Parts》 Accelerate integration of global ball-screw production sites Domestic Start production in China reorganization ☆Start ball screw production in China NSK KYUSHU from 11/3 1Q CO., LTD. Shenyang NSK 《Break down of ball screw production plan
Slide 29: Electric Power Steering (EPS): Enhance Business Base
Automotive Products Business 《Electric Power Steering (EPS)》 Enhance business base for EPS sales expansion (¥100 Million) 【Production】 Production Expand EPS sales Enhance base for EPS ■Start sales expansion production of new orders smoothly 1600 ＊Begin full-scale EPS production 1,400 at NSK Wanda (C
Slide 30: Speed up Business Expansion in Emerging Countries
Speed up business expansion in emerging countries Further enhance advantage ■ Further expand business structure (production/sales/technology/management) China ■ Enhance and utilize technology centers Expand sales sites ■ Expand production sites (Start production in Shenyang/ Expand EPS production/Co
Slide 31: (Supplementary Material)
(Supplementary Material) 30
Slide 32: Capital Expenditure, Depreciation and Amortization, R&D Expenses
(Supplementary Information) Capital expenditure, Depreciation and Amortization, R&D expenses 09/3 10/3 11/3 （¥100 Million） Actual Actual Forecast Capital Expenditures（＊） 419 198 350 Japan 245 99 165 Non-Japan 174 99 185 The Americas 22 10 22 Europe 35 11 26 Asia 117 78 137 ＊Excluding intangible asse
Slide 33: Forecast for Mid-term Plan by Business Segment
（Supplementary Material）Forecast for Mid-term Plan by business segment FY’09~FY’12 Mid term Plan （¥100 Million） 09/3 Actual 10/3 Actual 11/3 Forecast 13/3 Forecast Industrial Machinery Sales 2,670 2,020 2,405 3,000 Operating Income <%> 200 <7.5%> -17 <-0.8%> 150 <6.2%> 360 <12.0%> Industrial machine