Azbil Corporation · TSE:6845
Azbil — H1 FY2024 Earnings Presentation
41 slides from Azbil's earnings presentation, Nov 8, 2024
Slide 1: Presentation Materials for the Second Quarter of Fiscal Year 2024
Presentation Materials for the Second Quarter of Fiscal Year 2024 (Ending March 31, 2025) (Based on Japanese GAAP) November 8, 2024 Azbil Corporation RIC: 6845.T, Sedol: 6985543 © Azbil Corporation. All rights reserved.
Slide 2: Highlights
Highlights 1. Consolidated Financial Results for the First Half of FY2024 Orders received, net sales, and operating income were all higher than the same period of FY2023, mainly due to growth in the BA business. We achieved the targets planned for the BA, AA, and LA businesses, while overall net s
Slide 3: Contents
Contents 1. Consolidated Financial Results for the First Half of FY2024 4 2. Consolidated Financial Plan for FY2024 13 3. Returning Profits to Shareholders and Investment in Human Capital 17 4. Progress in Implementing the Medium-term Plan 21 5. The azbil Group’s Exhibition Participation 24 Appendix
Slide 4: 1. Consolidated Financial Results for the First Half of FY2024
1. Consolidated Financial Results for the First Half of FY2024 © Azbil Corporation. All rights reserved. 4
Slide 5: Consolidated Financial Results
1. Consolidated Financial Results for the First Half of FY2024 Consolidated Financial Results Orders received, net sales, and operating income were all higher than the same period of FY2023, mainly due to growth in the BA business. We achieved the targets planned for the BA, AA, and LA businesses, w
Slide 6: Financial Results by Segment
1. Consolidated Financial Results for the First Half of FY2024 Financial Results by Segment ■ BA: Orders received increased compared to the same period of FY2023 due to the renewal of large-scale multi-year service contracts and other factors. Progress was made with initiatives to level the workload
Slide 7: Segment Information: BA Business
1. Consolidated Financial Results for the First Half of FY2024 Segment Information: BA Business Business environment — In the domestic market, demand for new office buildings in urban redevelopment projects has leveled off but remains at a high level. Demand for the refurbishment of existing buildin
Slide 8: Segment Information: AA Business
1. Consolidated Financial Results for the First Half of FY2024 Segment Information: AA Business Business environment — In the process automation (PA) market, demand centering on domestic maintenance and refurbishment has remained firm. — In the FA market, despite there being signs of recovery in som
Slide 9: Segment Information: LA Business
1. Consolidated Financial Results for the First Half of FY2024 Segment Information: LA Business Business environment — The Lifeline field, which includes gas (city gas, LP gas) and water meters, depends on demand for meter replacement as required by law. Though demand can be expected to remain basic
Slide 10: Overseas Sales by Region
1. Consolidated Financial Results for the First Half of FY2024 Overseas Sales by Region Overseas sales increased by 8.1% from the same period of FY2023 and accounted for 25.1% of net sales. The BA business increased significantly in Asia and China. AA business maintained the same level as FY2023
Slide 11: Consolidated Financial Position
1. Consolidated Financial Results for the First Half of FY2024 Consolidated Financial Position Assets : Assets decreased mainly due to a decrease in trade receivables and in investment securities (investments and other assets) caused by a decline in market value and sales of investment securities.
Slide 12: Consolidated Cash Flows
1. Consolidated Financial Results for the First Half of FY2024 Consolidated Cash Flows Comparing cash flow with the same period of FY2023, free cash flow increased by 12.7 billion yen. This resulted from an increase in cash flow from operating activities—mainly due to an increase in inventories in
Slide 13: 2. Consolidated Financial Plan for FY2024
2. Consolidated Financial Plan for FY2024 Revised upwards from the plans announced on May 13 and October 15, 2024 © Azbil Corporation. All rights reserved. 13
Slide 14: Consolidated Financial Plan
2. Consolidated Financial Plan for FY2024 Consolidated Financial Plan Despite the impact on the full-year consolidated financial results of the exclusion of ATL from the scope of consolidation following the transfer of its equity interests and a fall in revenue due to the delayed recovery in the fac
Slide 15: Financial Plan by Segment (1)
2. Consolidated Financial Plan for FY2024 Financial Plan by Segment (1) ■ BA: Although expenses have increased, for both sales and segment profit the initial plan has been revised upward to reflect the higher revenue resulting from robust market conditions and improved profitability. ■ AA: Although
Slide 16: Financial Plan by Segment (2)
2. Consolidated Financial Plan for FY2024 Financial Plan by Segment (2) Although expenses have increased, for both sales and segment profit the initial plan has been revised upward to reflect the BA higher revenue resulting from robust market conditions and improved profitability. In Japan and ove
Slide 17: 3. Returning Profits to Shareholders and Investment in Human Capital
3. Returning Profits to Shareholders and Investment in Human Capital Repurchase of own stock is planned, dividend plan is unchanged from the latest announcement © Azbil Corporation. All rights reserved. 17
Slide 18: Basic Policy and FY2024 Shareholder Returns
3. Returning Profits to Shareholders and Investment in Human Capital Basic Policy and FY2024 Shareholder Returns The plan to increase the dividend for the 10th consecutive year remains unchanged, and DOE is expected to be 5% level. It is planned to repurchase the Company's own stock to the value of
Slide 19: Repurchase of Own Stock, Cancellation of Treasury Shares, and Human Capital Investment
3. Returning Profits to Shareholders and Investment in Human Capital Repurchase of Own Stock, Cancellation of Treasury Shares, and Utilization for Human Capital Investment It is planned to repurchase the Company’s own stock up to 15.0 billion yen or 24.0 million shares. Treasury shares worth app
Slide 20: Trend of Shareholder Returns
3. Returning Profits to Shareholders and Investment in Human Capital Trend of Shareholder Returns We plan to increase FY2024 annual dividend for the 10th consecutive year, and DOE to reach 5% level. Dividend per share Dividend on equity (DOE) 5.0 (Yen) 4.8 (plan) (%) 25 5.0 4.4 4.2 3.9 4.0 20 3.7
Slide 21: 4. Progress in Implementing the Medium-term Plan
4. Progress in Implementing the Medium-term Plan © Azbil Corporation. All rights reserved. 21
Slide 22: Long-term Targets and Medium-term Plan: Forecasting final year results
4. Progress in Implementing the Medium-term Plan Long-term Targets and Medium-term Plan: Forecasting business results for the final year of the medium-term plan that exceed the targets set at the time of formulation The azbil Group defines three growth fields, which share a common foundation of auto
Slide 23: Advancing Our Transformation for Further Growth, and Restructuring Our Business Portfolio
4. Progress in Implementing the Medium-term Plan Advancing Our Transformation for Further Growth, and Restructuring Our Business Portfolio Track changes in customers’ business models and demand resulting from structural changes in the business environment, and, to expand and achieve growth in the
Slide 24: 5. The azbil Group's Exhibition Participation
5. The azbil Group’s Exhibition Participation © Azbil Corporation. All rights reserved. 24
Slide 25: Introduce Automation Technologies and Products at Exhibitions
5. The azbil Group’s Exhibition Participation Introduce Automation Technologies and Products That Have Taken Advantage of Various Business Opportunities in Japan and Overseas New Automation × Environment and Energy Industrial Transformation ASIA-PACIFIC (ITAP) × Life-cycle Solutions Event dates: Oct
Slide 26: Appendix I: Financial Data
Appendix I Financial Data • Performance Trend by Segment ・・・27 • Capital Investment, Depreciation and R&D Expenses ・・・29 © Azbil Corporation. All rights reserved. 26
Slide 27: Performance Trend by Segment: Orders Received and Order Backlog
Appendix I Performance Trend by Segment: Orders Received and Order Backlog ■ Orders received by segment ■ Order backlog by segment (Billions of yen) (Billions of yen) 200.0 200.0 175.0 175.0 150.0 150.0 125.0 125.0 100.0 100.0 75.0 75.0 50.0 50.0 25.0 25.0 0.0 0.0 FY2022 FY2023 FY2024 FY2022 FY2023
Slide 28: Performance Trend by Segment: Sales and Segment Profit
Appendix I Performance Trend by Segment: Sales and Segment Profit ■ Sales by segment ■ Segment profit (operating income) (Billions of yen) 200.0 (Billions of yen) (%) 25.0 25.0 175.0 20.0 20.0 150.0 125.0 15.0 15.0 100.0 75.0 10.0 10.0 50.0 5.0 5.0 25.0 0.0 0.0 0.0 FY2022 FY2023 FY2024 FY2022 FY2023
Slide 29: Capital Investment, Depreciation and R&D Expenses
Appendix I Capital Investment, Depreciation and R&D Expenses ■ Capital investment, depreciation ■ R&D expenses Full-year results/ H1 results for FY2024 Full-year plan for FY2024 (%) (Billions of yen) (Billions of yen) 15.0 15.0 6.0 12.5 12.5 5.0 10.0 10.0 4.0 7.5 7.5 3.0 6.1 5.0 4.7 5.0 2.0 3.2 2.5
Slide 30: Appendix II
Appendix II Three Growth Fields, Sustainability Management, and Shareholder Returns • Transfer of Equity Interests in Azbil Telstar ・・・31 • Initiatives in Three Growth Fields and Application to Each Business Segment ・・・32 • The azbil Group’s Sustainability Management ・・・33 • Decarbonization Transiti
Slide 31: Transfer of Equity Interests in Azbil Telstar
Appendix II Transfer of Equity Interests in Azbil Telstar: Restructuring Our Business Portfolio in the LA Business From the perspective of restructuring our business portfolio to improve capital efficiency, the Company transferred Azbil Telstar to Syntegon Technology GmbH., a global packaging soluti
Slide 32: Initiatives in Three Growth Fields and Application to Each Business Segment
Appendix II Initiatives in Three Growth Fields and Application to Each Business Segment Three Growth Fields New Automation Field Providing distinctive solutions through our business in the three growth fields in which the Expanding sales by providing solutions that meet new demands azbil Group posse
Slide 33: The azbil Group's Sustainability Management
Appendix II The azbil Group’s Sustainability Management Materiality is identified from the perspective of sustainability and contributing “in series” to a sustainable society. As regards the seven key categories related to business and corporate activities, specific azbil Group SDG targets have been
Slide 34: Decarbonization Transition Plan
Appendix II Decarbonization Transition Plan We are actively contributing to solutions for energy challenges faced by both our customers and society at large, and we have also developed a transition plan to support decarbonization efforts. Our scope 3 emission reduction target towards FY2030, which h
Slide 35: Investing in Human Capital: Benefits and Financial Measures
Appendix II Investing in Human Capital: Benefits and Financial Measures to Improve Employee Engagement Partial Revision to the Employee Stock Ownership Plan (J-ESOP), further increasing employee incentives and enhancing engagement Employee Stock Ownership Plan (J-ESOP) (introduced in May 2017) Point
Slide 36: FY2024 Annual Dividend Plan
Appendix II FY2024 Annual Dividend Plan FY2024 It is planned to increase the dividend by 12 yen per share, to make an annual dividend of 88 dividend yen*1 per share, and DOE to reach 5% level. *1 For comparison, the dividend amount before the stock split is shown. Profitability has been strengthen
Slide 37: Overview of the Stock Split
Appendix II Overview of the Stock Split Implemented a 4-for-1 common stock split Stock split Effective from Tuesday, October 1, 2024 Investment unit cost is now in the 100-thousand-yen range* following the stock split * Calculated based on the closing price on Tuesday, October 1, 2024 To increase sh
Slide 38: Notes (1)
Notes (1) 1. Financial data and financial statements have been prepared based on Japanese GAAP and the amounts have been rounded down. 2. The following are the azbil Group’s segments (each identified by abbreviation) together with the various sub-segments and their principal business fields. BA: Bui
Slide 39: Notes (2)
Notes (2) 4. Essential Goals of azbil Group for SDGs *1 3.40 million metric tons of CO2/year: The FY2030 emission factor from electricity generation is our own estimated value based on the Japanese government’s Energy Basic Plan in 2019. *2 Science-based targets (SBT): Greenhouse gas emission reduct
Slide 40: Notes (3)
Notes (3) 4. Essential Goals of azbil Group for SDGs *9 Provide environments that support stress-free and diverse work styles to 6 million people: As of April 2022, environments that support stress-free and diverse work styles have been provided to 0.6 million people, aiming to increase tenfold to 6
Slide 41: IR Inquiries and Disclaimer
IR Inquiries and Disclaimer Inquiries regarding investor relations Azbil Corporation Investor Relations Phone: +81-3-6810-1031 Email: azbil-ir@azbil.com Disclaimer The projections are based on management’s assumptions, intent and expectations in light of the information currently available to it, an