Yamaha Corporation · TSE:7951
Yamaha — FY2019.3 Earnings Presentation
39 slides from Yamaha's earnings presentation, May 10, 2019
Slide 1: Analyst and Investor Briefing on FY2019.3
Analyst and Investor Briefing on FY2019.3 (Fiscal year ended March 2019.3) May 10, 2019 Yamaha Corporation
Slide 2: FY2019.3 Full Year Highlights
FY2019.3 Full Year Highlights Overview Figures in parentheses are year-on-year comparisons Performance in FY2019.3 (based on Japanese GAAP) • Sales and income both increased year-on-year. Operating income and ordinary income reached record levels. • Robust sales (up 1.0%) were driven by strength in
Slide 3: Agenda
Agenda 1. Performance Summary 2. Performance Outlook 3. Segment Overview & Updates 4. ESG 5. Other Financial Figures 6. Return to Shareholders 2
Slide 4: 1. Performance Summary of FY2019.3 (Japanese GAAP)
1. Performance Summary of FY2019.3 (Japanese GAAP)
Slide 5: FY2019.3 Summary (Japanese GAAP)
FY2019.3 Summary (Japanese GAAP) (billions of yen) Change Previous FY2018.3 FY2019.3 YoY (%) projections (YoY) for FY2019.3 *3 Net Sales 433.0 437.4 +4.4 +1.0% 440.0 Operating Income 48.8 56.0 +7.2 +14.7% 55.0 (Operating Income Ratio) (11.3%) (12.8%) (12.5%) Ordinary Income 49.2 58.4 +9.2 +18.7% 55.
Slide 6: Operating Income Analysis (Japanese GAAP)
Operating Income Analysis (Japanese GAAP) (billions of yen) Versus previous year Increase in sales Cost 56.0 and production, reduction Labor cost at product mix, etc. 0.4 overseas 1.1 Impact of factories exchange 48.8 -1.1 SG&A 9.5 rates -2.7 FY2018.3 FY2019.3 Versus previous projections Labor cost
Slide 7: Performance by Business Segment (Japanese GAAP)
Performance by Business Segment (Japanese GAAP) (billions of yen) Exchange FY2018.3 FY2019.3 Change rate impact Net Sales 274.5 282.0 +7.5 -2.8 Musical Operating Income 34.6 42.9 +8.3 +0.3 Instruments Operating Income Ratio 12.6% 15.2% +2.6P Net Sales 121.8 120.7 -1.1 -1.2 Audio Operating Income 10.
Slide 8: 2. Performance Outlook of FY2020.3 (IFRS standards)
2. Performance Outlook of FY2020.3 (IFRS standards)
Slide 9: FY2020.3 Outlook (IFRS standards)
FY2020.3 Outlook (IFRS standards) (billions of yen) FY2019.3 *2 FY2020.3 (projections) Revenue 434.4 444.0 Core Operating Profit 53.0 55.0 (Core Operating Profit Ratio) (12.2%) (12.4%) *1 Net Profit 40.2 42.5 Exchange Rate (yen) Revenue US＄ 111 110 (Average rate during the period) EUR 128 125 Profit
Slide 10: Core Operating Profit Analysis (IFRS standards)
Core Operating Profit Analysis (IFRS standards) (billions of yen) Versus previous year Labor cost Cost at overseas Impact of Increase in reduction 55.0 factories sales and 53.0 exchange rates model mix etc. 3.2 -1.5 -2.1 SG&A 4.8 -2.4 FY2019.3* FY2020.3 * Results under IFRS standards for FY2019.3 ar
Slide 11: Outlook by Business Segment (IFRS standards)
Outlook by Business Segment (IFRS standards) (billions of yen) FY2019.3 *2 FY2020.3 (projections) Revenue 279.9 285.5 Musical Core Operating Profit 40.8 43.0 Instruments Core Operating Profit Ratio 14.6% 15.1% Revenue 119.8 123.5 Audio Core Operating Profit 9.7 11.0 Equipment Core Operating Profit R
Slide 12: Key Management Figures
Key Management Figures <Results (Japanese GAAP)> *2 Operating Income Ratio 12.0% ROE 14.5% Earnings per Share (yen) *1 11.3% 12.8% 14.0% 292*2 10.9% 11.4% 249 *1 241 200 yen 9.3% 10% level 10.1% level 169 129 8.1% 7.0% FY2015.3 FY2016.3 FY2017.3 FY2018.3 FY2019.3 Previous FY2015.3 FY2016.3 FY2017.3
Slide 13: 3. Segment Overview & Updates
3. Segment Overview & Updates
Slide 14: Musical Instruments Net Sales/Revenue and Operating Income/Core Operating Profit
Musical Instruments Net Sales/Revenue and Operating Income/Core Operating Profit FY2019.3 Sales up year-on-year in all product categories • Pianos and digital pianos drove growth, and sales of wind instruments and string and (billions of yen) percussion instruments were also robust • China recorded
Slide 15: Musical Instruments Sales by Major Product Category
Musical Instruments Sales by Major Product Category (billions of yen) Piano Digital Musical Winds Strings/ Instruments Percussion (104%) (103%) 93.8 94.9 91.3 (103%) 21.0 21.0 (103%) (107%) (105%) 57.4 56.1 29.2 52.9 28.5 (108%) (104%) (102%) 13.3 12.6 42.4 44.0 43.6 4Q (106%) (108%) (108%) 9.9 10.3
Slide 16: Musical Instruments Sales by Region
Musical Instruments Sales by Region (includes software products and music schools) (98%) (98%) (billions of yen) 77.0 75.3 74.2 4Q (101%) (109%) (103%) 19.5 19.8 59.2 59.3 (99%) (110%) (105%) 54.2 52.1 51.1 (102%) (102%) 3Q (106%) 15.3 50.3 (116%) 50.7 50.1 49.4 51.0 (96%) 18.5 17.7 14.2 11.0 (101%)
Slide 17: Develop Products with Distinctive Individuality
Develop Products with Distinctive Individuality Distinctive product line-up fusing a wide range of technologies Amalgamating acoustic and electronic technologies to create new customer value Line 6 Compact Professional TransAcoustic Piano C3X-TA2 Stage Piano CP88 Guitar Processor HX Stomp Hybrid Pia
Slide 18: Worldwide Acclaim for Yamaha Design
Develop Products with Distinctive Individuality Worldwide Acclaim for Yamaha Design Clavinova CSP Series received the Red Dot Award: Venova casual wind instrument received Product Design 2019, a prestigious German design Grand Award with Special Mention in the DFA award (March 2019) Design for Asia
Slide 19: Achieve Growth in Emerging Markets - India
Achieve Growth in Emerging Markets -India Sales Initiatives Aimed at the Next Growth Market After China Exclusive model for Indian market Establish production bases New factory in India (Chennai) started shipments in April 2019 Supply products optimized for India, a vast market of 1.3 billion people
Slide 20: Audio Equipment Net Sales/Revenue and Operating Income/Core Operating Profit
Audio Equipment Net Sales/Revenue and Operating Income/Core Operating Profit FY2019.3 AV products faced headwinds, but PA equipment sales drove growth • Sales of AV products were down year-on-year due to delays in responding to changes in (billions of yen) demand • PA equipment sales increased year-
Slide 21: Audio Equipment Sales by Major Product Category
Audio Equipment Sales by Major Product Category (billions of yen) AV Products PA Equipment ICT Devices *Includes only sales of products for PA Equipment (excluding engineering and installation services) (109%) (103%) 52.7 (97%) (102%) 49.0 48.4 48.0 46.4 46.4 (99%) (99%) 10.2 (95%) 11.5 (106%) 9.4 1
Slide 22: Audio Equipment Sales by Region
Audio Equipment Sales by Region (billions of yen) (100%) (103%) (105%) 32.5 32.3 (104%) 30.8 (97%) 30.9 32.0 (105%) 30.0 28.6 29.3 (97%) 27.3 7.2 6.5 (96%) 7.1 6.9 (112%) 4Q (120%) 9.9 (103%) 22.5 8.3 (101%) 20.2 20.0 10.5 10.3 9.3 (104%) 9.7 (102%) (100%) 4.7 4.6 3Q 5.9 5.9 (89%) (91%) (111%) (95%)
Slide 23: Flagship 5000 series Hi-Fi products
Develop Products with Distinctive Individuality Flagship 5000 series Hi-Fi products ─ Aiming for new heights of musical expression Turntable Integrated Amplifier Integrated Amplifier Premium Bookshelf Speaker GT-5000 C-5000 M-5000 NS-5000 Yamaha Group product development in the audio equipment field
Slide 24: Develop Products with Distinctive Individuality
Develop Products with Distinctive Individuality Yamaha awarded 1st place in the network device category of the Partner Satisfaction Survey 2019 published in the February 21, 2019 issue of Nikkei Computer magazine Following on from the 1st place award in the network device category of the Customer Sa
Slide 25: IMC and Others Net Sales/Revenue and Operating Income/Core Operating Profit
IMC and Others Net Sales/Revenue and Operating Income/Core Operating Profit FY2019.3 • Electronic device sales declined year-on-year due to a fall in amusement equipment sales (billions of yen) and slowing sales to China • In the factory automation equipment category, sales of precision machinery an
Slide 26: 4. ESG
YAMAHA
Slide 27: Environment: Sustainable wood procurement initiatives
Environment Sustainable wood procurement initiatives Implemented project in Tanzania to build a business Yamaha and Kyoto University have signed a model enabling sustainable use of materials for comprehensive research agreement aimed at woodwind instruments sustainable cultivation and use of forest
Slide 28: Social: Music promotion activities in emerging countries
Social Steady advance of music promotion activities in emerging countries Expanded School Project aimed at giving more children the opportunity to play a musical instrument Provided packages of instructors, programs, and musical instruments to elementary schools in emerging countries to create envir
Slide 29: Social: Initiatives to create diverse working styles
Social Initiatives to create diverse working styles More flexible work rules Establishment of workplace childcare Trialled telecommuting and short-time flexible working facilities hours, etc. (introduction of new systems planned for 2019) Childcare centers will open in August 2019 in the aim of crea
Slide 30: 5. Other Financial Figures
5. Other Financial Figures YAMAHA
Slide 31: Balance Sheet Summary
Balance Sheet Summary (billions of yen) As of March 31, As of March 31, As of March 31, 2018 2019 2020 (projections) (Japanese GAAP) (Japanese GAAP) (IFRS standards) Cash and deposits 122.7 106.1 Cash and cash equivalents 109.7 Notes and accounts receivable 55.3 54.4 Trade and other receivables 69.6
Slide 32: Capital Expenditure/Depreciation, R&D Expense
Capital Expenditure/Depreciation, R&D Expense (billions of yen) Capital Expenditure/Depreciation Others 24.6 22.0 1.8 16.0 Audio 4.2 2.1 Equipment 1.2 3.9 Musical 2.8 Instruments 18.6 16.0 10.8 12.0 10.8 12.7 FY2018.3 FY2019.3 FY2020.3 (projections) R&D Expenses 24.8 24.9 26.5 4.5 4.4 4.0 11.4 11.1
Slide 33: 6. Return to Shareholders
YAMAHA 6. Return to Shareholders 32
Slide 34: Acquisition of Treasury Stock and Dividends
Acquisition of Treasury Stock and Dividends Acquisition of Treasury Stock Purpose of acquisition: To enhance shareholder returns and capital efficiency - Acquisition period: February 6 to July 31, 2019 - Number of shares to be acquired: 5 million shares (maximum) - Amount of acquisition: ¥20 billion
Slide 35: Appendix
Appendix YAMAHA
Slide 36: Full Year Other Income and Expenses (Japanese GAAP)
Full Year Other Income and Expenses (Japanese GAAP) (billions of yen) FY2018.3 FY2019.3 Operating Income 48.8 56.0 Net financial income 4.3 4.2 Non-Operating Income/Loss Others -3.9 -1.8 Total 0.4 2.4 Ordinary Income 49.2 58.4 Income from (loss on) Gain on sales of Yamaha disposal of fixed assets Mo
Slide 37: Full Year Projections of Other Income and Expenses (IFRS standards)
Full Year Projections of Other Income and Expenses (IFRS standards) (billions of yen) FY2019.3 *2 FY2020.3 (projections) Core Operating Profit 53.0 55.0 Profit from (loss on) disposal of fixed assets -0.3 -0.1 Other Income and Expenses Others 0.4 0.1 Total 0.1 0 Operating Profit 53.1 55.0 Dividends
Slide 38: Yamaha - Make Waves
@) YAMAHA Make Waves
Slide 39: Forward-looking statements notice
In this report, the figures forecast for the Company’s future performance have been calculated on the basis of information currently available to Yamaha and the Yamaha Group. Forecasts are, therefore, subject to risks and uncertainties. Accordingly, actual performance may differ greatly from our pro