Terumo Corporation · TSE:4543
Terumo — H1 FY2019 Earnings Presentation
21 slides from Terumo's earnings presentation, Nov 7, 2019
Slide 1: Financial Results for the First Half of Fiscal Year Ending March 31, 2020 (FY2019)
Financial Results for the First Half of Fiscal Year Ending March 31, 2020 (FY2019) Terumo Corporation Chief Accounting and Financial Officer Naoki Muto November 7, 2019
Slide 2: Highest-ever 1H Revenue and Profit
Highest-ever 1H Revenue and Profit (billion JPY) YoY% 1H FY18 1H FY19 YoY% (FXN) Revenue 285.0 307.3 +8% +11% Gross Profit 154.6 (54.2%) 171.5 (55.8%) +11% +14% SG&A Expenses 87.0 (30.5%) 89.6 (29.2%) +3% +6% R&D Expenses 23.8 ( 8.3%) 24.3 ( 7.9%) +2% +5% Other Income and Expenses 3.7 1.6 - - Operat
Slide 3: Adjusted Operating Profit Variance Analysis
Adjusted Operating Profit Variance Analysis (billion JPY) 2.5 1.0 6.0 Price MDR 4.1 Gross -0.6 margin IT SG&A 2.8 invest- increase R&D 2.3 ment increase FX 18.5 -0.4 7.8 67.0 G/P 7.7 increment 59.2 55.3 by sales increase 47.6 1H FY18 1H FY18 1H FY19 1H FY19 Operating Adjusted Adjusted Operating Prof
Slide 4: Revenue by Region
Revenue by Region 1H FY19 1H FY18 Revenue Year-on-Year Revenue Comparison 100% = 307.3 B JPY billion JPY YoY% Comments ( ) FXN Japan : Steady growth in General Hospital Company. Double digit growth in Cardiac 95.9 and Vascular Company Japan 91.1 +5% 31% Europe : Cardiac and Vascular Company, especia
Slide 5: Revenue by Business Segment
Revenue by Business Segment 1H FY19 1H FY18 Revenue Year-on-Year Revenue Comparison 100% = 307.3 B JPY billion JPY YoY% Comments ( ) FXN Cardiac 172.6 Driven by double digit growth of TIS +12% 56% and business in all regions, as well as 153.5 (+16%) Neurovascular business. Positive Vascular growth i
Slide 6: Cardiac and Vascular: Positive Growth in All Businesses
Cardiac and : Positive Growth in All Businesses. Vascular Significant Increase in Revenue and Profit (billion JPY) 1H FY18 1H FY19 YoY% Major Topics Impact ( ) FXN 172.6 153.5 TIS：Double digit growth in all regions +15.3 Neurovascular : Continuous high growth +12% Revenue centered in US +3.5 (+16%)
Slide 7: General Hospital: Revenue and Profit in Line with the Guidance
General Hospital : Revenue and Profit in Line with the Guidance (billion JPY) 1H FY18 1H FY19 YoY% Major Topics Impact ( ) FXN General hospital products : Steady momentum excluding the FX impact 0.0 81.2 82.8 Pharmaceutical and nutrition : Double digit +2% growth in pain management products and Reve
Slide 8: Blood Management: Returned to Positive Growth in Revenue
Blood : Returned to Positive Growth in Revenue. Management Profitability Recovered as Planned (billion JPY) 1H FY18 1H FY19 YoY% Major Topics Impact ( ) FXN Blood center products : Recovered the delay 50.2 51.8 occurred in Q1. Also contributed by winning a +3% tender in an emerging country +1.4 Reve
Slide 9: Factors for Higher Profit Than 1H Guidance and Risks in 2H
Factors for Higher Profit Than 1H Guidance and Risks in 2H Major factors for higher profit than 1H Guidance Product mix improvement due to higher sales in TIS and Neurovascular, production cost down in those two businesses Delay in spending pace of MDR cost Delay in spending pace of SG&A exp
Slide 10: Major Topics in FY19 Q2
Major Topics in FY19 Q2 Japan’s first domestic disposable syringe made by Terumo was selected for “Essential historical materials for science and technology” (Sep) Joined two U.S.-based venture capital funds (Aug) Corporate Participated in “TELEWORKDAYS 2019” as a special cooperative organization
Slide 11: New Products Pipeline in FY19
New Products Pipeline in FY19 Category Products Region Launch Category Products Region Launch Closure device for distal General Next generation of syringe pump Access radial approach JP hospital JP Narcotic analgesic for EU, postoperative pain management Coronary PTCA balloon Launched JP Launched As
Slide 12: Reference
Reference ~TERUMO 42/21
Slide 13: 1H FY19 Revenue and Growth by Region
1H FY19 Revenue and Growth by Region (billion JPY) Business Overseas Grand Japan Segment Subtotal Europe Americas China Asia etc. Total Cardiac and 24.8 147.9 42.2 67.2 20.5 18.0 172.6 Vascular (+11%) (+17%) (+14%) (+15%) (+27%) (+23%) (+16%) Out of C&V Interventional 18.7 122.3 34.4 53.7 19.1 15.0
Slide 14: Operating Expenses
Operating Expenses (billion JPY) 1H FY18 1H FY19 YoY YoY% YoY% (FXN) Salaries & Wages 43.3 44.0 +0.7 +2% +5% Sales Promotion 8.7 9.5 +0.8 +9% +12% Logistical Costs 6.6 6.8 +0.3 +4% +7% Depreciation & 6.9 9.1* +2.2 +32% +34% Amortization Others 21.6 20.3* -1.3 -6% -4% SG&A Expenses Total 87.0 89.6 +2
Slide 15: Quarterly Results
Quarterly Results (billion JPY) FY18 Q2 Q3 Q4 FY19 Q1 Q2 (Jul-Sep) (Oct-Dec) (Jan-Mar) (Apr-Jun) (Jul-Sep) Revenue 142.0 158.6 155.9 152.5 154.8 Gross Profit 74.7 87.6 84.3 85.2 86.3 (52.6%) (55.2%) (54.1%) (55.8%) (55.8%) SG&A Expenses 43.5 45.0 46.7 44.5 45.1 (30.5%) (28.4%) (29.9%) (29.2%) (29.1%
Slide 16: Adjusted Operating Profit: Adjustments
Adjusted Operating Profit : Adjustments (billion JPY) 1H FY18 1H FY19 Operating profit 47.6 59.2 Adjustment 1. Amortization of acquired +7.5 +7.8 intangible assets Adjustment 2. Non-recurring profit or loss +0.2 +0.0* Adjusted operating profit 55.3 67.0 <General examples of adjustment items> * 1H FY
Slide 17: CAPEX and R&D Expenses
CAPEX and R&D Expenses (billion JPY) Amortization of Amortization 75.0 Expand investment in acquired of acquired production capacity and intangible assets intangible 60.8 and goodwill assets space as well as IT in FY19 49.0 Under IFRS since FY17 45.4 43.6 42.0 44.0 43.2 Depreciation includes 3
Slide 18: Cash Flows
Cash Flows Operating CF Investing & Financing CF +49.7 -55.3 (billion JPY) 11.3 25.1 Income taxes 22.1 Depreciation and Working amortization capital increase 58.1 43.2 CAPEX 10.0 Profit 2.0 before Dividends Others 123.0 tax 117.4 Cash at the CAPEX = C.i.P. record basis Cash at the end of FY18 Cash a
Slide 19: Foreign Exchange Sensitivity
Foreign Exchange Sensitivity Annual impact of 1 JPY depreciation (billion JPY) USD EUR CNY Revenue 1.7 0.8 2.2 Adjusted Operating 0.0 0.5 1.2 Profit <Reference> Impact when JPY is depreciated by 10% North Latin EMEA Asia America America EUR Others CNY Others Adjusted Operating -0.1 1.0 6.5 1.3 1.9 3
Slide 20: The Status of Convertible Bonds
The Status of Convertible Bonds Detail of the bonds (issued in Dec. 2014) *After two-for-one stock split implemented in Apr. 2019 Aggregate Contingent Number of shares Conversion price Maturity principal amount Coupon conversion trigger required to be issued (JPY) (billion JPY) price (JPY) for con
Slide 21: IR Contact
IR Contact Terumo Corporation Corporate Communication (IR) Dept. E-mail: kouhou_terumo01@terumo.co.jp Among the information that Terumo discloses, the forward-looking statements including financial projections are based upon our assumptions using information available to us at the time and are not i