Hosokawa Micron Corporation · TSE:6277
Hosokawa Micron — 1H FY2023 Earnings Presentation
45 slides from Hosokawa Micron's earnings presentation, Jun 7, 2023
Slide 1: Financial Results The 1st half of FY2023
Financial Results The 1st half of FY2023 7th Jun. 2023 Process Technologies for Tomorrow © HOSOKAWA MICRON CORP. All rights Reserved.
Slide 2: Agenda
１．Financial Summary The 1st half of FY2023 ２．Outlook for the Future ３．Topics ４．Appendix © HOSOKAWA MICRON CORP. All rights Reserved. 1/43
Slide 3: 1. Financial Summary The 1st half of FY2023
１．Financial Summary The 1st half of FY2023 ２．Outlook for the Future ３．Topics ４．Appendix © HOSOKAWA MICRON CORP. All rights Reserved. 2/43
Slide 4: Financial Summary
Financial Summary Consolidated Bookings Net Sales Operating Profit 44.0 YoY billion JPY 37.1 billion JPY 3.2 billion JPY YoY YoY ＋11.1％ ＋14.1％ ＋5.8％ Powder Processing Business Blown Film Business Bookings Net Sales Bookings Net Sales 36.1billion JPY 29.7billion JPY 7.9billion JPY 7.4billion JPY YoY
Slide 5: Financial Highlights
Financial Highlights Booming business in the electronic materials field, such as for lithium ion batteries. Bookings reached a record high of 44.05 billion JPY （+11.1％YoY）. Steady sales from abundant backlogs resulted in record Net Sales of 37.18 billion JPY （+14.1％YoY）. However, the trend of longer
Slide 6: Income statement overview
Profit/Loss Currency FY2023 1H FY2022 1H Exchange US dollar(US$) 136.96JPY 114.95JPY Rate （100 million JPY ） Euro (€) 143.20JPY 130.23JPY Change from the Cost of sales ratio increased by 0.5 pt same period last year cost of sales due to the impact of higher raw material (+45.8) （▲32.2） costs. 14.7%
Slide 7: Bookings by Application
Bookings by Application （100 million JPY ） *Excluding Aftersales, toll processing, etc. Electronic materials Pharmaceuticals Foods (incl.LIBs) 44 40 37 33 24 22 FY2022 1H FY2023 1H FY2022 1H FY2023 1H FY2022 1H FY2023 1H Polymers Metals & (incl.Blown films) Chemicals Minerals Recycle 115 85 80 42 30
Slide 8: Trend of Bookings, Net sales & Backlogs
Trend of Bookings, Net sales & Backlogs Due to strong Bookings, the Backlogs carried over to the 2nd half of FY2023 is the highest ever (approx. 56.9 billion JPY). To solve the long delivery times is a issue. （億円） 600 569 Bookings Net Sales Backlogs 500 500 400 372 300 267 264 272 229 200 175 100 0
Slide 9: Trend of dwell time in Backlogs
Trend of dwell time in Backlogs Backlogs are increasing due to longer delivery times for procured parts and materials, but the situation is improving. 273Day 278Day 223Day 186Day 151Day FY2019 2020 2021 2022 2023 1H Backlogs ※1 Backlogs dwell time (day) ＝ Net Sales per day（ Net Sales ÷365） ※2 Concer
Slide 10: Bookings by business (Powder processing business)
Bookings by business（Powder processing business） The mainstay chemicals and the electronic materials especially for lithium ion battery are performing well. The foods field also are recovering by investment in specific fields. As a result, Bookings in this business increased 25.7% YoY. YoY （100 mill
Slide 11: Bookings by business (Aftersales)
Bookings by business （Aftersales） Business remained strong both domestically and internationally due to booming Bookings mainly for lithium ion battery materials. Aftersales business increased 32.3% YoY, especially strong growth in the U.S., China, Western Europe, Southeast Asia, and South Korea. Yo
Slide 12: Bookings by business (Toll processing)
Bookings by business （Toll processing） Performance is solid both domestically and internationally, but reduction of energy costs and negotiations to pass on prices are challenges. YoY ＋4.3% （100 million JPY） 15.4 14.8 13.0 12.9 11.1 FY2019 1H 2020 1H 2021 1H 2022 1H 2023 1H © HOSOKAWA MICRON CORP. A
Slide 13: Bookings by business (Blown film business)
Bookings by business（Blown film business） While inquiries in the mainstay European market are strong, the U.S. market is entering an adjustment phase. Backlogs are at a high level, but the improvement of long delivery times and promotion of price shifting are necessary. 121.0 （100 million JPY） 110.1
Slide 14: Net Sales Increase/Decrease Factors
Net Sales Increase/Decrease Factors （100 million JPY） Powder Blown Foreign processing film exchange business business ＜ Areas of strong < To net sales performance ＞ Exchange Rate ・ Packaging films Sensitivity > ・ Lamination films ・ USD：1.02 ＜ Areas of strong ・ EUR：2.95 performance ＞ ・ Chemicals ・ Li
Slide 15: Sales by Group Companies' Location
Sales by Group Companies’ Location Sales ratio of overseas subsidiaries in this 1H is approx. 76%. As for Blown film business, Net Sales in the U.S. declined YoY. Net Sales in the Powder processing business increased in all regions YoY, and the company as a whole also achieved an increase in Net Sal
Slide 16: Operating Profit Increase/Decrease Factors
Operating Profit Increase/Decrease Factors ＜ Effect of increased sales ＞＜ Impact on cost of sales ＞ （100 million JPY） ・ Powder processing business ・Increase in raw materials, subcontracted processing, ： ＋59 manufacturing costs, etc.： ▲12 ・ Blown film business ・ Increase in labor costs ： ▲8 ： ▲14 ＜ I
Slide 17: Balance Sheet
Balance Sheet Capital adequacy ratio ：59.7％（Change from end of previous year ▲2.7pt） *( ) shows the change from the beginning balance. 〈100 million JPY〉 Current Assets Liabilities 581 351 （▲3） （＋28） Liability with Cash and cash Accounts payable, etc. Interest :22 equivalents 100 243 （＋10） （▲13） Acco
Slide 18: Cash Flow
Cash Flow Operating CF temporarily decreased in this 1H due to the timing of customer payments. Net cash used in investing and financing activities increased respectively, mainly due to purchase of PPE and treasury stock. CF from Operating Activities （100 million JPY） CF from Investing Activities CF
Slide 19: Stock Price and Dividend
Stock Price and Dividend （As of May 19, 2023） 4,500 Trend of Stock Price and Trading Volume 1,800 Trading Volume (1,000 shares) 4,000 1,600 Stock Price (JPY) 3,500 1,400 3,000 1,200 2,500 1,000 2,000 800 1,500 600 1,000 400 500 200 0 0 ※Share consolidation 1:0.2 1st Apr.2017 ※Stock splits 1:2 1st Oc
Slide 20: 2. Outlook for the Future
１．Financial Summary The 1st half of FY2023 ２．Outlook for the Future ３．Topics ４．Appendix © HOSOKAWA MICRON CORP. All rights Reserved. 19/43
Slide 21: Full Year Forecast and Progress Rate
Full Year Forecast and Progress Rate Record high level of Backlogs to be carried over to the 2nd half of FY2023, and delivery times remain long. Moderately improved profitability is expected due to the sales from projects that have made progress in price shifting. FY2023 FY2023 FY2023 rate of （milli
Slide 22: Anticipated Risks and the Forecast for the 2nd half of FY2023
Anticipated Risks and the Forecast for the 2nd half of FY2023 FY2023 FY2023 FY2023 As of Plan Results for 1H Forecast for 2H Formulation Activation of activities after COVID-19 pandemic Forecast increase As expected Forecast increase in SG&A expenses YoY in SG&A expenses +14.7% Extended delivery tim
Slide 23: Delivery time and cost projections (As of Plan Formulation)
Delivery time and cost projections (As of Plan Formulation) Operating profit ratio is expected to increase as delivery time and cost return to before COVID-19 pandemic. High Long delivery time Delivery time to and high cost normal level ・ Bookings increase ・ Bookings decrease (ahead of time) costs,
Slide 24: Delivery time and cost projections (Revised after the 1st half of FY2023)
Delivery time and cost projections (Revised after the 1st half of FY2023) Although long delivery times have become a regular occurrence, operating profit is expected to increase due to progress in price shifting and a slowdown in the rate of cost increases. High Long delivery time Delivery time to a
Slide 25: Improving Performance (Consolidation)
Improving Performance (Consolidation) 14th Mid-term 15th Mid-term 16th Mid-term 17th Mid-term Plan for 3 years Plan for 3 years Plan for 3 years Plan for 3 years Challenge to be Global Standard Further development of Hosokawa Micron Group Hosokawa Micron Group Hosokawa Micron Group Mountain Range of
Slide 26: Cash Allocation
Cash Allocation Buyback of treasury stock in March 2023 Operating capital is secured due to the continuing trend of long delivery times Repayment of Repayment of interest-bearing liabilities 9 interest-bearing liabilities 9 Acquired over Acquired Cash from Operation Investment Investment the next 3
Slide 27: 3. Topics
１．Financial Summary The 1st half of FY2023 ２．Outlook for the Future ３．Topics ４．Appendix © HOSOKAWA MICRON CORP. All rights Reserved. 26/43
Slide 28: Stock Buyback in the Review of strategic holding shares
Stock Buyback in the Review of strategic holding shares Point Point 1 Nisshin Seifun Group Inc. 2 • Each of the two companies owns our shares. " The Nisshin Seifun Group • We have a business alliance with Nisshin Medium-Term Management Plan 2026 " Engineering Inc. ⇒ Steady reduction of Cross-Shareho
Slide 29: Joint venture established in Germany (Measurement and Analysis)
Joint venture established in Germany (Measurement and Analysis) To strengthen the partnership between H&B and our subsidiary, Hosokawa Alpine AG, and to expand the scope of our measurement and laboratory equipment business in particle analysis. The new company takes over the particle analysis measur
Slide 30: Launch of new factory in Japan (Toll processing)
Launch of new factory in Japan (Toll processing) With the launch of the new factory, production capacity of Hosokawa Powders Corporation will increase to 1.5 times the current level. Automation through the introduction of the latest models to achieve 24-hour operation in the future Factory Overview:
Slide 31: 4. Appendix
１．Financial Summary The 1st half of FY2023 ２．Outlook for the Future ３．Topics ４．Appendix © HOSOKAWA MICRON CORP. All rights Reserved. 30/43
Slide 32: Company Profile
Company Profile Representative Kohei HOSOKAWA Foundation Apr. 1916 capital 144.96 Million JPY Fiscal Establishment Aug.1949 year end Sep. stock Prime Market of Tokyo stock exchange. market （from Apr. 4 th, 2022） Head Office 1-9, Shodaitajika, Hirakata City, Osaka Location Consolidated 1,916 Employee
Slide 33: About Us
About Us Message “Powder Technology contributes to the Society” Corporate Vision The Hosokawa Micron Group will always be the leading global company covering the mountain range of Powder Technologies. The Group will achieve peaks of excellence in the development and commercialization of advanced mat
Slide 34: About Us: Our Business
About Us Our Business We provide providing machinery, equipment, and system engineering Business Areas Powder Processing Business and Blown Film Business © HOSOKAWA MICRON CORP. All rights Reserved. 33/43
Slide 35: Powder Technologies
Powder Technologies Milling Drying Various operations Separation Granulation Blending Measurement Recovery of powders, Filtration © HOSOKAWA MICRON CORP. All rights Reserved. 34/43
Slide 36: Powder Processing Equipment
Powder Processing Equipment Example of a product that contributes to the manufacture of lithium ion batteries and electronic components, etc. Dry for Material of LIB Fine milling of raw materials of secondary batteries (e.g., LIB including all solid battery) Fine milling of electronics materials Coa
Slide 37: Blown Film and Related Technology
Blown Film and Related Technology Film manufacturing equipment The melted polymer is inflated with air using the inflation method and molded into a bag shape. The translucent part is the film Offering the system (including Winder, Orientation, etc.) © HOSOKAWA MICRON CORP. All rights Reserved. 36/43
Slide 38: Our business expanding worldwide
Our business expanding worldwide Possesses one of the industry's largest manufacturing, aftersales service, and R&D systems Manufacturing and repairing large machines by our own factories in Japan, the U.S., and Europe Global support for maintenance and remodeling (Equipment Improvement) Research an
Slide 39: Where powders are used?
Where powders are used ? synthetic resins battery Automobiles recycle Toner, Magnets, Carbide Electronics materials Materials Clean room Minerals Hosokawa Micron Group Air Pollution Prevention Foods agriculture Pharmaceuticals chemicals © HOSOKAWA MICRON CORP. All rights Reserved. 38/43
Slide 40: Strong fields and applications in the 1st half of FY2023
Strong fields and applications in the 1st half of FY2023 Japan/Asian Group European Group American Group Rechargeable battery-related businesses continue to perform well worldwide Powder Processing business Foods Chemical Cell culture media for Materials pharmaceutical production Medical supplies Bl
Slide 41: Corporate History
Corporate History Foundation of the Osaka Turbine Water Mill Asian subsidiaries, Malaysia (1995), Korea 1916 (1996), France (1999), China (2005), India Company 1995 (2007), Russia (2012), Thailand (2019), Poland Company name changed to the Hosokawa Iron (2020), Switzerland, Mexico, Chile(2022) 1949
Slide 42: Percentage of Bookings by Application Segmentation
Percentage of Bookings by Application Segmentation Blown Brown films 24.7% film 34.0% 32.0% 31.6% 33.3% 32.9% 37.2% 35.9% business Recycle 42.0% 4.8% Metals & Minerals 3.8% 5.4% 8.9% 3.0% 5.0% 6.4% 2.6% 3.5% 9.1% 1.7% 9.7% 8.2% 11.2% 13.0% 13.2% 10.5% Polymers 6.6% 12.5% 2.1% 4.0% 1.9% 1.3% 2.5% 5.7
Slide 43: Geographical Segmentation (Net Sales)
Geographical Segmentation （Net Sales） ※Size of squares shows sales amount. Sales by Group Companies’ Location Sales by Customers’ Location (Destination) © HOSOKAWA MICRON CORP. All rights Reserved. 42/43
Slide 44: Major Group Companies (Net Sales)
Major Group Companies（Net Sales） ※Size of squares shows sales amount. © HOSOKAWA MICRON CORP. All rights Reserved. Others 43/43
Slide 45: No part of this document must be reprinted or reproduced
No part of this document must be reprinted or reproduced by any means without permission from our company. © HOSOKAWA MICRON CORP. All rights Reserved.