Dowa Holdings Co., Ltd. · TSE:5714
Dowa — H1 FY2022 Earnings Presentation
30 slides from Dowa's earnings presentation, Nov 16, 2022
Slide 1: Corporate Strategy Briefing
Corporate Strategy Briefing First Half of FY2022 (FY Ending March 2023) November 16, 2022
Slide 2: FY2022 Full Year Forecasts
FY2022 Full Year Forecasts In Q1 FY2022, market prices and volumes were firm, but metal prices began softening from Q2, and electricity costs rose more than expected. In H2 profit is expected to decline compared with H1, in part due to falling metal prices, a decrease in demand for some applications
Slide 3: Factor Analysis of FY2022 H2 Ordinary Income
Factor Analysis of FY2022 H2 Ordinary Income (Changes from Previous Forecasts) (billion yen) Previous forecasts (H2) 30.5 Major factors for change Sales reduction (4.5) - Decline in sales of products such as silver powder for solar panels and copper rolled products for smartphones. Electricity costs
Slide 4: Major Market Trends (1)
Major Market Trends (1) (Compared to Q1 of FY2020) Volume of treated waste (Japan) Volume of collected recycling materials Volume of zinc produced 120 140 140 107 108 116 110 120 120 111 108 105 106 102 102 103 103 103 102 106 100 100 99 100 100 100 96 96 100 93 91 94 100 92 94 84 82 86 89 79 75 90
Slide 5: Major Market Trends (2)
Major Market Trends (2) (Compared to Q1 of FY2020) Volume of sales of LEDs Volume of sales of copper rolled products Volume of carburizing treatment (for automobiles) 260 220 280 240 260 229 208 200 220 240 217 213 209 180 167 165 163 162 166 165 220 199 193 201 199 195 200 153 157 151 160 164 160 2
Slide 6: Evolution of Recycling-oriented Business Model
Progress of Midterm plan 2024 Evolution of Recycling-oriented Business Model © 2022 DOWA HOLDINGS CO., LTD. 6
Slide 7: Environmental Management & Recycling (1)
Environmental Management & Recycling (1) Business Overview ❚ Business Environment (FY2022/H2) 《Major Product Trends》 （FY2021/H1＝100） FY2021 FY2022 - Waste treatment business: Volume of waste generated has will FY2024 H1 H2 H1 H2 remain flat both in Japan and in Southeast Asia. Volume of treated wast
Slide 8: Environmental Management & Recycling (2)
Environmental Management & Recycling (2) Changes from In progress Plan Progress of Key Measures in Midterm Plan the last material Expanding treatment of hazardous Waste treatment Expanding treatment of fluorocarbons and other hazardous waste waste Expanding recycling Increasing the volume of recycli
Slide 9: Environmental Management & Recycling (3)
Environmental Management & Recycling (3) Major Initiatives (details) ❚ Strengthening of Business Response Capabilities in Southeast Asia Markets (Indonesia) - Expansion of areas that handle orders through alliance with existing sites (PPLi), completion of construction of second landfill side (DESI)
Slide 10: Nonferrous Metals (1)
Nonferrous Metals (1) Business Overview ❚ Business Environment (FY2022/H2) 《Major Product Trends》 （FY2021/H1＝100） FY2021 FY2022 - Metal prices, for both base metals and precious metals, FY2024 H1 H2 H1 H2 are expected to be at a lower level than the H1 average. Volume of gold produced (Kosaka) 100 6
Slide 11: Nonferrous Metals (2)
Nonferrous Metals (2) Changes from In progress Plan Progress of Key Measures in Midterm Plan the last material Treating more materials for recycling Introduction Tests and development Start of operation by handling impurities of test facilities Precious metals and copper Increasing the production vo
Slide 12: Further strengthening of complex functions combining mining, smelting and recycling
Nonferrous Metals (3) Further strengthening of complex functions that combine mining, smelting and recycling - Strengthening capacity for existing markets: Expand sales for various applications including automotive by expanding capacity and increasing production at each plant. - Expansion into growt
Slide 13: Electronic Materials (1)
Electronic Materials (1) Business Overview ❚ Business Environment (FY2022/H2) 《Major Product Trends》 （FY2021/H1＝100） FY2021 FY2022 - Sluggish markets for telecommunications equipment and FY2024 H1 H2 H1 H2 semiconductors. Volume of sales of LEDs 100 109 149 132 168 - The sales volume of wearable dev
Slide 14: Electronic Materials (2)
Electronic Materials (2) Changes from In progress Plan Progress of Key Measures in Midterm Plan Semiconductors the last material Increasing production capacity of Start mass production Construction work for increasing production Start of operation short-wavelength-infrared LEDs and photo diodes (PD)
Slide 15: Electronic Materials (3)
Electronic Materials (3) Major Initiatives (details) ❚ Silver powder - High-efficiency panels have become general purpose and market share has declined due to the worsening competitive environment from the influx of players. - Competition for current-gen panels has intensified, making it difficult t
Slide 16: Metal Processing (1)
Metal Processing (1) Business Overview ❚ Business Environment (FY2022/H2) 《Major Product Trends》 （FY2021/H1＝100） FY2021 FY2022 - With the shift to electrified and more intelligent automobiles, FY2024 H1 H2 H1 H2 the number of automobiles produced is expected to increase Volume of sales of copper rol
Slide 17: Metal Processing (2)
Metal Processing (2) Changes from In progress Plan Progress of Key Measures in Midterm Plan the last material Sales expansion to small terminals for automotive use Increasing sales of high-value-added products Sales expansion to terminals for industrial machinery Copper rolled products Construction
Slide 18: Metal Processing (3)
Metal Processing (3) Major Initiatives (details) ❚ Copper Rolled Products - For automobiles: Demand is increasing, reflecting a shift to electric power and EVs. Launch of SilC plating® silver-graphite composite plating with low insertion force and excellent contact reliability. → Expansion into appl
Slide 19: Heat Treatment (1)
Heat Treatment (1) Business Overview ❚ Business Environment (FY2022/H2) 《Major Product Trends》 （FY2021/H1＝100） FY2021 FY2022 - Global automotive production is on the way to recovery from FY2024 H1 H2 H1 H2 the impact of the COVID-19 pandemic. Heat Treatment Sales Domestic: Monthly fluctuations in or
Slide 20: Heat Treatment (2)
Heat Treatment (2) Changes from In progress Plan Progress of Key Measures in Midterm Plan the last material Developing and expanding sales of heat treatment facilities which realize Developing Z-TKM Internal demonstration testing Starting sales of mass-production furnaces carbon neutrality Industria
Slide 21: Enhancing products and services that help achieve carbon neutrality
Heat Treatment (3) Enhancing products and services that help achieve carbon neutrality The Company will steadily launch new products and services on the market to respond to strong expectations in the automotive market. ❚ SS Vacuum Carburizing Furnace - Small lot production will be possible, and CO2
Slide 22: Strengthening Sustainability Management
Progress of Midterm plan 2024 Strengthening Sustainability Management © 2022 DOWA HOLDINGS CO., LTD. 22
Slide 23: Development of a sustainability-related policy structure
Development of a sustainability-related policy structure The Company will consolidate and organize Group policies related to sustainability and develop a policy structure that culminates in the Sustainability Basic Policy. The policy will clarify the Company's direction in each area of sustainabilit
Slide 24: Start of new sustainability promotion system operation
Start of new sustainability promotion system operation From April 2022, the Sustainability Subcommittee and Sustainability Committee have been meeting regularly to discuss Groupwide matters. The Company will shift from the sharing of information on sustainability activities to continuing to the deve
Slide 25: Tackling Climate Change
Tackling Climate Change The Climate Change Working Group established in April 2022 identifies products and services that help tackle climate change based on two perspectives (seizing opportunities and mitigating risks), organizes the challenges that need to be addressed to meet the greenhouse gas re
Slide 26: Driving Digital Transformation (DX)
Driving Digital Transformation (DX) From early FY2021, response to the digital governance code was strengthened, and certification as a "DX Certified Operator" was obtained from the Ministry of Economy, Trade and Industry in July 2022. During the period of Midterm Plan 2024, the Company will steadil
Slide 27: Dividends
Dividends Based on the dividend policy set in Midterm Plan 2024, the dividend for this fiscal year will be 105 yen per share, marking a 5-yen increase in the ordinary dividend from the previous fiscal year. The Company will aim to further increase dividends in light of future trends in financial res
Slide 28: Issuance of DOWA REPORT2022 (Integrated Report)
Issuance of DOWA REPORT2022 (Integrated Report) At the end of November 2022, the Company plans to release DOWA REPORT 2022 (Integrated Report 2022, Japanese edition). The report will cover information regarding policies, promotion structures, measures and indicators related to each material issue ba
Slide 29: (Appendix) Assumptions and Sensitivities
(Appendix) Assumptions and Sensitivities Sensitivity (Operating Income / FY2022 H2) Million yen Assumptions Fluctuation Sensitivity Exchange rate 145.0 ¥/$ ±1 ¥/$ 310 Copper 7,500 $/ton ±100 $/ton 20 Zinc 2,900 $/ton ±100 $/ton 240 * Exchange rate sensitivity; Nonferrous Metals 260 million yen and E
Slide 30: Forward-looking statements
Forward-looking statements made in this document, such as business forecast, are based on the information available at this time and on certain premises that the Company assumes to be reasonable. Actual performance may differ materially from such forecasts due to a variety of factors. © 2022 DOWA HO