Innotech Corporation · TSE:9880
Innotech — H1 FY2020 Earnings Presentation
32 slides from Innotech's earnings presentation, Nov 10, 2020
Slide 1: FY2020 1st Half Financial Results
FY2020 1st Half Financial Results November 10, 2020 1
Slide 2: Agenda
Agenda 1 FY2020 1H Actual 2 FY2020 Outlook 3 M i d -Te r m a n d L o n g -Te r m S t ra t e g y 2
Slide 3: FY2020 1H Highlights
FY2020 1H Highlights Revenue and profit increased in the first half on a non- consolidated basis but profit decreased on a consolidated basis INNOTECH increased its revenue and profit mainly based on the stable tester business. IT ACCESS substantially increased its revenue and profit mainly from the
Slide 4: FY2020 1H Actual
FY2020 1H Actual (Unit: mil yen) Sanei GAIO STAr INNOTECH IT Access REGULUS Consolidated Hytechs TECHNOLOGY Technologies YoY FY19 FY20 FY19 FY20 FY19 FY20 FY19 FY20 FY19 FY20 FY19 FY20 FY19 FY20 Year 1H 1H 1H 1H 1H 1H 1H 1H 1H 1H 1H 1H 1H 1H Net Sales 6,167 7,058 1,623 1,699 1,813 2,285 1,778 1,659
Slide 5: FY2020 1H Design and Development Solution Business
FY2020 1H Design and Development Solution Business 〔Sales: mil. yen〕 〔Gross Profit: mil. yen〕 12,500 3,000 2,752 2,784 10,000 2,500 1,623 1,688 三栄ハイテックス Sanei Hytechs 453 298 2,000 レグラス REGULUS 7,500 IT Access アイティアクセス 1,815 2,288 Embedded System 1,500 組込システム 907 783 GAIO TECHNOLOGY ガイオテクノロジー 5,000
Slide 6: Design and Development Solution Business
Design and Development Solution Business EDA Tough to develop new business opportunities due to the pandemic; stable results for the first half, revenue slightly increased. GAIO Solid tool business but the demand slowed down for the verification service due to COVID; revenue and profit declined. Emb
Slide 7: FY2020 1H Product Solution Business
FY2020 1H Product Solution Business 〔Sales: mil. yen〕 〔Gross Profit: mil. yen〕 6,000 2,000 1,713 1,660 5,000 484 1,500 4,000 780 Others その他 1,974 STAr STAｒ 3,000 1,000 Technologies Technologies Tester テスター 2,402 2,000 Gross Profit 売上総利益 500 1,000 2,345 1,133 0 0 FY2019 1H2Q 20年3月期 FY2020 1H2Q 21年3月期
Slide 8: Product Solution Business
Product Solution Business Testers Solid customers′ capital investment as the demands for memory products recovered. Revenue substantially increased on a year-over- year basis STAr Substantial decrease of measurement equipment business with the supply chain confusion caused by COVID. Major slow-down
Slide 9: Major Expenses and Non-Operating Expenses and Income
Major Expenses and Non-Operating Expenses and Income [mil. yen] FY2019 1H FY2020 1H Research & Development 519 743 Depreciation 385 463 Amortization of Goodwill 103 135 Major Items of Non-operating Expenses and Income Real Estate Rent Income 229 238 Related Expenses for Real Estate Rent 156 169 Fore
Slide 10: Cash Flow
Cash Flow （※） Rounded down to the nearest 1 million yen [mil. yen] FY2019 1H FY2020 1H Profit Before Income Taxes 678 599 Depreciation and Amortization of Goodwill 489 598 Working Capital and Others 1,238 -102 Cash Flows from Operating Activities 2,405 1,095 Purchase of Investment Securities -427 0
Slide 11: Agenda
Agenda 1 FY2020 1H Actual 2 FY2020 Outlook 3 M i d -Te r m a n d L o n g -Te r m S t ra t e g y 11
Slide 12: FY2020 Highlights: No change for the annual estimate
FY2020 Highlights No change for the annual estimate COVID 19 affects customer demands on the areas of automotive, railways, FA and OA. INNOTECH results will remain stable mainly based on the tester business; revenue and profit will increase compared to the plan as of beginning of FY2020 by cost redu
Slide 13: Impact of spreading COVID-19 on our business and outlook
Impact of spreading COVID-19 on our business and outlook Assumption made in Early FY2020 Hypothesis that COVID-19 would keep affecting our business until the second quarter Impact would be small on the semiconductor industry Impact on the automotive industry would be inevitable Impact up to no
Slide 14: FY2020 Estimate
FY2020 Estimate [mil. yen] GAIO STAr Sanei IT Consolida INNOTECH TECHNOL Technolo REGULUS FY2019 YoY Hytechs ACCESS ted OGY gies Net Sales 14,900 3,300 4,400 3,400 5,400 700 32,000 31,161 2.7% Gross 3,920 880 1,020 1,320 2,350 220 9,680 9,595 Profit 0.9% (26.3%) (26.7%) (23.2%) (38.8%) (43.5%) (31.4
Slide 15: FY2020 Outlook: Design and Development Solution Business
FY2020 Outlook:Design and Development Solution Business 〔Sales: mil. yen〕 〔Gross Profit: mil. yen〕 25,000 5,715 6,000 5,480 20,000 5,000 3,543 3,290 943 680 4,000 Sanei Hytechs 三栄ハイテックス 15,000 REGULUS レグラス 4,518 4,390 IT Access アイティアクセス 3,000 Embedded System 組込システム 1,733 1,600 10,000 GAIO TECHNOLOGY
Slide 16: Design and Development Solution Business
D e s i g n a n d D e ve l o p m e n t S o l u t i o n Business EDA Expect to increase revenue compared to FY2019 by successfully winning new projects. GAIO Outlook for the automotive business is still unclear while high profitability will be maintained by suppression of cost. Embedded System Aim to
Slide 17: FY2020 Outlook: Product Solution Business
FY2020 Outlook: Product Solution Business 〔Sales: mil. yen〕 〔Gross Profit: mil. yen〕 15,000 5,000 4,200 12,500 3,880 4,000 1,030 10,000 1,265 3,000 Others その他 7,500 5,350 STAr STAｒ Technologies テスター Tester 5,749 2,000 5,000 Gross Profit 売上総利益 2,500 5,200 1,000 2,962 0 0 20/3月期 FY2019 21/3月期 FY2020 (
Slide 18: Product Solution Business
Product Solution Business Testers ・ Expect to achieve the plan as of beginning of FY2020. ・New business plan for China in alliance with V Technology is received well by the customers. STAr Expect to recover and achieve the same level of results on a year-over- year basis for the second half. Secure
Slide 19: EBITDA Trends
EBITDA Trends [mil. yen] EBITDA上期 EBITDA 1H 3,500 EBITDA下期 EBITDA 2H 3,233 3,102 3,112 Operating 営業利益 Profit 3,000 2,500 1,994 2,046 1,790 1,929 1,893 2,000 739 1,955 1,500 1,204 1,670 1,650 1,244 1,000 999 1,255 1,442 500 1,173 1,210 842 0 FY2016 17年3月期 FY2017 18年3月期 FY2018 19年3月期 FY2019 20年3月期 FY2
Slide 20: Dividends
Dividends Dividend As of 1H- As of FY- Full Year Payout end end Ratio FY2019 20 yen 20 yen 40 yen 49.4% FY2020 (Outlook) 20 yen 20 yen 40 yen 46.2% We intend our consolidated divided payout ratio not to be less than 30%. Our goal is to maintain around 50% level as long as our business remains stable
Slide 21: Agenda
Agenda 1 FY2020 1H Actual 2 FY2020 Outlook 3 M i d -Te r m a n d L o n g -Te r m S t ra t e g y 21
Slide 22: Mid-Term Management Plan
Mid-Term Management Plan (Announced in February 2019) (Background) • Changes in the industry environment • Active overseas expansion and investment • Improvement of capital efficiency in the INNOTECH Group (Five Strategies) • Expansion of test solution business • Increase sales of internally-develop
Slide 23: Mid-term Management Plan: Progress of Profit Planning
Mid-term Management Plan: Progress of Profit Planning ROE 8.0% Mid-term Management Plan 5.8% 5.6% ROE Target: Over 8% FY2019 FY2019 FY2020 通期 FY2020 ... FY2023（計画） FY2023 (Plan) In order to achieve the target: （前期実績） （見通し） Mid-term Management 新中期経営計画 (Actual) (Estimate) Plan • Operating Profit：3-3.5
Slide 24: Our Group Business Trends under the COVID
Our Group Business Trends under the COVID～Accelerating DX and Increased Demands for IoT, Robotics, AI and Touchless Solutions～ E-Money settlement system of IT ACCESS remained strong for the first half. Regulus AI camera system was adopted for the family-style “LOVOTTM” of GROOVE X, Inc, which is a h
Slide 25: Regulus AI Camera which can be mounted on a vehicle is listed in NETIS
Regulus AI Camera which can be mounted on a vehicle is listed in the NETIS database of MLIT REGULUS AI camera “EagleEye🄬🄬II” was registered with the NETIS, which is the database managed by the Ministry of Land, Infrastructure, Transport and Tourism to share information on new technologies of…
Slide 26: Smart Skin Care Provides Customized Services
Smart Skin Care🄬🄬 Provides Customized Services Smart Skin Care🄬🄬 is a cloud service which comprehensively manages the customer data and his or her own skin data which is taken by a microscope. Customers utilize the service by smartphones and tablets. IT ACCESS provides customized services…
Slide 27: Starting Experiments of Smart Building at the INNOTECH Building
Starting Experiments of Smart Building at the INNOTECH Building Starting Experiments to prove and realize the concept of Smart Building which creates new values by optimizing building management and analyzing collected data Aiming for DX (digital transformation) of operation, maintenance and man
Slide 28: INNOTECH and OSARO Jointly Open the AI Picking Laboratory
INNOTECH and OSARO Jointly Open the ”AI Picking Laboratory” and Announce the “Piece Picking Station” Opening the “AI Picking Laboratory” jointly with OSARO in the INNOTECH Building. Aim to expand the business of OSARO by providing introduction support for the system, such as creating AI models.
Slide 29: Capital Management Policy
Capital Management Policy: Our current numerical goals ROE • Mid-term and long-term goal is 8-10%. ROIC (Return on Invested Capital) • Aiming at 8-10% in the future; expand the ROIC - WACC spread. D/E Ratio (Debt Equity Ratio) • In the event of fundraising by interest-bearing debt, such as loans, th
Slide 30: Reduction of Capital Reserve
Reduction of Capital Reserve Based on our Capital Management Policy which was announced in February 2018, INNOTECH has continued to repurchase treasury shares. In order for our capital policy to be more flexible and our financial strategies to be resilient, it was resolved at our 34th general shareh
Slide 31: COVID-19: Our Measures
COVID-19: Our Measures In order to minimize the spread of COVID-19, INNOTECH has been encouraging its employees to avoid peak rush hours while commuting and to take a break time separately from others since March, and to work from home since April. Upon declaration of a state of emergency by the Jap
Slide 32: Note for Forward Looking Statements
Note for Forward Looking Statements The information provided in this presentation includes forward looking statements based on current expectations, forecasts or beliefs. Such forward looking statements include a number of preliminary assumptions about future events that are subject to factors and u