Slide 1: FY2024 Financial Results Presentation
FY2024 Financial Results Presentation May 26, 2025 Mitsuyasu Watanabe President, Representative Director, and Chief Operating Officer (COO) OSAKI ELECTRIC CO., LTD. TSE Prime Market Code: 6644 Copyright (C) 2024 OSAKI ELECTRIC CO., LTD. All Rights Reserved 1
Slide 2: Agenda
Agenda Business Overview Progress of the Mid-Term １ 4 Management Plan 1. Revisions to the Financial Targets 2 FY2024 Financial Summary 2. Reasons for the Revisions 3. Financial Targets （Details） 4. Strategy by Segment 1. FY2024 Financial Highlights 5. R&D, Depreciation and Capital Expenditures 2. FY
Slide 3: Business Overview
1 Business Overview Copyright (C) 2024 OSAKI ELECTRIC CO., LTD. All Rights Reserved 3
Slide 4: Company Profile
Company Profile （As of March 31, 2025） Company OSAKI ELECTRIC CO.,LTD. Name Founded August 1916 Established January 1937 Capital 7,965.75 million yen Representative Yoshihide Watanabe, Chairman and CEO Development, manufacturing, sale, installation of meters, instrument transformers, Business automa
Slide 5: Business Overview
Business Overview Osaki Electric Co., Ltd. is an electrical equipment manufacturer that has contributed to the efficient use of energy for over a century through the metering and control of electric power, since its founding ＜Key Features of Our Business＞ ⚫ Our flagship product, the electricity mete
Slide 6: Business Overview from a 3C Perspective: Smart meters in Japan (1)
Business Overview from Smart meters in Japan (1) a 3C Perspective ● Manufacture and sale of smart meters for electric utilities and non-utilities Sales Ratio For utilities Approx.85％ For non-utilities customers Approx. 15％ ■ Smart meters for utilities (Japan) Smart Meter Business Mechanical Meters C
Slide 7: Business Overview from a 3C Perspective: Smart meters in Japan (2)
Business Overview from Smart meters in Japan (2) a 3C Perspective ■ Sales volume trends for smart meters for utilities (Overview) Smart meter business Smart meter replacement cycle ● Replacement cycle overview • The service life of residential smart meters is 10 years, as Current model Current model
Slide 8: Business Overview from a 3C Perspective: Solution business
Business Overview from Solution business (partial) a 3C Perspective /Switchgear ■ Smart Locks Solution business Product Main Sales OPELO customers Channel Competitors Features Leasing Rental property • IC cards and smartphones equipped with key company management functionality • Major rental propert
Slide 9: Business Overview from a 3C Perspective: Smart meters & solutions (Overseas)
Business Overview from Smart meters & solutions (Overseas) a 3C Perspective Product Metering system • Overseas metering business is operated by EDMI Limited, a group company • Developing a solution business using smart meters (electricity, gas, and water) and Meter Data Management System ・ MDMS owne
Slide 10: OSAKI Group's Corporate Philosophy and Vision
OSAKI Group’s Corporate Philosophy and Vision Philosophy We create new value for society （Purpose） through visualization of the invisible Vision Challenges Promptness Values Innovation Dedication to Society Copyright (C) 2024 OSAKI ELECTRIC CO., LTD. All Rights Reserved 10
Slide 11: FY2024 Financial Summary
2 FY2024 Financial Summary Copyright (C) 2024 OSAKI ELECTRIC CO., LTD. All Rights Reserved 11
Slide 12: 1. FY2024 Financial Highlights
1. FY2024 Financial Highlights Increased Sales and Decreased Profit (YoY) (On an operating profit basis) 01 Sales and profit increased overseas, driven by strong performance in Oceania. In Japan, however, despite higher sales, profit declined due to changes in the product mix. As a result, consolida
Slide 13: 2. FY2024 Consolidated Financial Results (1) YoY
2. FY2024 Consolidated Increased Sales Financial Results (1) YoY Decreased Profit 【Sales】 Japan Sales in the smart meter business slightly declined due to a moderate decrease in demand for current-generation smart meters The solution business saw sales growth, driven by strong non-utility meter sale
Slide 14: 3. Net Sales by Business Portfolio (1) (Japan) YoY
3． Net Sales by Business Portfolio (1) (Japan) YoY Smart meters & solutions in Japan Decreased Sales ▼ Smart meter • Sales for current-generation smart meters declined due to easing demand ahead of second-gen rollout Business • Non-meter utility products and services remained steady; overall busines
Slide 15: 3. Net Sales by Business Portfolio (2) (Overseas) YoY
3． Net Sales by Business Portfolio (2) (Overseas) YoY Smart meters & solutions overseas Increased Sales ▲ Oceania • Sales increased YoY due to higher shipments driven by new and replacement demand Decreased Sales▼ Europe • Sales decreased YoY due to lingering effects of inventory adjustments in FY20
Slide 16: 4. Operating Profit Variance Analysis
4. Operating Profit Variance Analysis Smart meters & (Billions of Yen) solutions in Japan +0.2 △0.4 4.5 △0.2 • Change in product Mix （following the high margin composition in 4.0 FY2023） • Increase in outsourcing costs • Increase in personnel expenses FY2023 Increased sales Decreased Increased FY202
Slide 17: 5. Trends in Net Sales, Operating Profit, and Operating Profit Margin
5. Trends in Net Sales, Operating Profit, and Operating Profit Margin （Billions of Yen） ■ Net Sales ■ Operating Profit 9% Operating Profit Margin 100.0 97.1 98.0 95.1 6.2% 89.3 5.9% 5.9% 9.0 76.2 5.9 5.7 5.8 2.5% 1.7% 2.2 1.3 FY2021 FY2022 FY2023 FY2024 FY2025 FY2026 Actual Actual Actual Actual Fore
Slide 18: 6. FY2024 Consolidated Financial Results (2) Against the initial forecast
6. FY2024 Consolidated Against the Increased Financial Results (2) initial forecast Sales and Profit 【Sales】 Japan Sales increased in the smart meter business through integrated efforts across production and sales to secure orders amid demand fluctuations Overseas Sales increased due to additional o
Slide 19: 7. Business Progress Assessment (FY2024)
7. Business Progress Assessment （FY2024） ■ Smart meters & solutions in Japan Progress Key highlights ・ Progress is assessed using a four-level internal rating ・ Orders for current smart meters have exceeded the initial forecast system: Good, Slightly Smart meter business Good ・ Second-gen smart mete
Slide 20: 8. Recording of Extraordinary Gains and Losses
8. Recording of Extraordinary Gains and Losses Extraordinary Gains • Gains were recorded from the sale of real estate and strategic shareholdings as part of efforts to effectively utilize management resources and enhance asset efficiency Extraordinary Losses • Expenses including retirement benefits
Slide 21: 9. Balance Sheet / Cash Flow Statement
9. Balance Sheet / Cash Flow Statement Balance Sheet Cash Flow • Accounts receivable decreased due to overseas collections • Operating cash flow totaled 6.8 billion yen, driven by • Inventories increased in preparation for future overseas shipments an increase in net income and a decrease in account
Slide 22: FY2025 Financial Forecast
3 FY2025 Financial Forecast Copyright (C) 2024 OSAKI ELECTRIC CO., LTD. All Rights Reserved 22
Slide 23: 1. FY2025 Financial Forecast (1) Summary
YoY Increased 1. FY2025 Financial Forecast (1) Summary Sales and Profit 【Sales】 Japan Sales projected to grow with the gradual introduction of second-gen smart meters Overseas Sales expected to increase in USD terms due to continued progress in the UK smart meter project, with shipments to Oceania p
Slide 24: 1. FY2025 Financial Forecast (2) by Segment
YoY 1. FY2025 Financial Forecast (2) by Segment Japan 【Sales】 • Solutions and Switchgear businesses expected to remain flat Increased Sales • Smart meter sales to grow with the rollout of second-gen models in H2 Decreased Profit 【Profit】 • Profit expected to decline due to increased depreciation and
Slide 25: 2. Net Sales by Business Portfolio (1) (Japan) YoY
2. Net Sales by Business Portfolio (1) (Japan) YoY Smart meters & solutions in Japan Smart meter Increased • Sales expected to decline due to the discontinuation of the current smart meters Sales▲ • Sales expected to increase with the launch of second-gen smart meter Business （Second-gen smart meter
Slide 26: 3. Overview by Business Portfolio (Japan: Smart Meter Business)
3. Overview by Business Portfolio (Japan ： Smart Meter Business) Net sales FY2024 Progress （vs. Initial Forecast） (Billions of Yen) ＜Current smart meters＞ • Secured orders exceeding the initial plan through integrated production and sales response to demand fluctuations 40.7 ＜Second-gen smart meters
Slide 27: 3. Overview by Business Portfolio (Japan: Solution Business)
3. Overview by Business Portfolio (Japan ： Solution Business) Net sales FY2024 Progress （vs. Initial Forecast） (Billions of Yen) ・ Exceed initial plan by acquiring new non-utility customers （Meters sold to non-utility customers are recorded under the “Solution Business”） ・ GX services fell short of
Slide 28: 3. Overview by Business Portfolio (Japan: Switchgear Business)
3. Overview by Business Portfolio (Japan ： Switchgear Business) Net sales FY2024 Progress （vs. Initial Forecast） (Billions of Yen) • Consists of utility and industrial segments, with data centers as the main focus for industrial sales • Sales to data centers are progressing steadily, supported by st
Slide 29: 4. Net Sales by Business Portfolio (2) (Overseas) YoY
4. Net Sales by Business Portfolio (2) (Overseas) YoY Smart meters & solutions overseas Decreased • Shipments are expected to remain in line with FY2024 levels Oceania Sales▼ • Sales expected to decline in JPY on a stronger yen assumption Decreased • Sales in the UK expected to increase due to the c
Slide 30: 5. Overview by Business Portfolio (Overseas: Oceania)
5. Overview by Business Portfolio (Overseas： Oceania) Net sales FY2024 Progress （vs. Initial Forecast） (Billions of Yen) • Additional orders, mainly from Australia, led to results exceeding the initial forecast • Revenue increased further due to a weaker yen against the U.S. dollar compared to the a
Slide 31: 5. Overview by Business Portfolio (Overseas: Europe (UK))
5. Overview by Business Portfolio (Overseas： Europe （UK）) Net sales FY2024 Progress （vs. Initial Forecast） (Billions of Yen) • Shipments are steady and in line with the initial forecast • Revenue increased due to a weaker yen against the U.S. dollar compared to the assumed forex rate 15.8 • Profit m
Slide 32: 5. Overview by Business Portfolio (Overseas: Asia)
5. Overview by Business Portfolio (Overseas： Asia) Net sales FY2024 Progress （vs. Initial Forecast） (Billions of Yen) • Shipments are in line with the initial forecast, and revenue increased due to a weaker yen against the U.S. dollar compared to the assumed forex rate 5.0 4.7 Forecast in FY2025 4.0
Slide 33: 5. Overview by Business Portfolio (Overseas: The Middle East & Africa)
5. Overview by Business Portfolio (Overseas： The Middle East & Africa) Net sales FY2024 Progress （vs. Initial Forecast） (Billions of Yen) • Revenue decreased due to selective order-taking based on credit risk considerations • Profit margins improved through cost reduction 3.5 3.0 3.0 3.0 Forecast in
Slide 34: Progress of the Mid-Term Management Plan
4 Progress of the Mid-Term Management Plan Copyright (C) 2024 OSAKI ELECTRIC CO., LTD. All Rights Reserved 34
Slide 35: 1. Revisions to the Financial Targets
1. Revisions to the Financial Targets FY2024 FY2025 FY2026 (Billions of Yen) Forecast Initial Revised Forecast Actual Forecast Forecast (No revisions) Net sales 90.0 97.1 95.0 98.0 100.0 Operating profit 4.7 5.7 5.5 5.8 9.0 Net profit 2.0 3.5 3.5 3.6 5.5 Operating profit margin 5.2% 5.9% 5.8% 5.9% 9
Slide 36: 2. Reasons for The Revisions
2. Reasons for The Revisions ⚫ For FY2025, net sales and operating profit forecasts have been revised, reflecting updated forex assumptions and recent trends ⚫ For FY2026, no revisions have been made as progress is broadly in line with the initial forecast (Note: Partial revisions have been made to
Slide 37: 3. Financial Targets (Details)
3. Financial Targets （Details） FY2024 FY2025 FY2026 Revised Revised Initial Forecast Actual Initial Forecast Initial Forecast (Billions of Yen) Forecast Forecast Smart meters & solutions in Japan 53.5 56.1 56.0 57.7 59.5 63.7 Net sales Smat meter business 32.5 34.9 33.5 36.7 36.0 40.7 (By business p
Slide 38: 4. Strategy by Segment: Smart Meter Business
４． Strategy by Segment Smart Meter Business *Non-utility meter refers to meter products distributed to customers other than electric power (excluding Non-Utility Meters*) companies (Excluding Real Estate Business) ■Forecast of changes in the external environment ■Internal/external environment summat
Slide 39: 4. Strategy by Segment: Solutions business
４． Strategy by Segment Solutions business *Non-utility meter collectively refers to meter products distributed to customers other than electric power companies (Excluding Real Estate Business) ■Forecast of changes in the external environment ■Internal/external environment summation (SWOT analysis) (
Slide 40: 4. Strategy by Segment: Smart meters & solutions overseas
４． Strategy by Segment Smart meters & solutions overseas (Excluding Real Estate Business) ■Forecast of changes in the external environment ■Internal/external environment summation (SWOT analysis) (up to around 2027) Politics ・ Intensifying trade war and supply chain disruption in the U.S. <Strengths
Slide 41: 5. R&D, Depreciation and Capital Expenditures
5. R&D, Depreciation and Capital Expenditures ■ FY2023 Actual ■ FY2024 Actual ■ FY2025 Forecast （Millions of Yen） 6,500 3,841 3,529 3,575 3,500 3,300 2,304 2,215 1,938 R&D expenses Depreciation expenses Capital expenditures （Millions of Yen） FY2025 FY2023 Actual FY2024 Actual YoY Change Forecast R&D
Slide 42: (Reference) Mid-Term Management Plan Financial Targets
(Reference) Mid-Term Management Plan Financial Targets FY2024 FY2025 FY2026 Revised (Billions of Yen) Initial Forecast Actual Initial Forecast Forecast forecast Net sales 90.0 97.1 95.0 98.0 100.0 Operating profit 4.7 5.7 5.5 5.8 9.0 Operating profit 5.8% 9.0% 5.2% 5.9% 5.9% margin Net profit 2.0 3.
Slide 43: 6. Expected External Environment and Risk/Opportunity Responses (1)
6. Expected External Environment and Risk/Opportunity Responses (as of May 2025) Expected External Major Expected Risks [R] and Key Countermeasures Environment Opportunities [O] 【R】 Reduced demand and increased credit • Quickly capture risk information and apply selective Heightened Geopolitical ris
Slide 44: 6. Expected External Environment and Risk/Opportunity Responses (2)
6. Expected External Environment and Risk/Opportunity Responses (as of May 2025) Expected External Major Expected Risks [R] and Key Countermeasures Environment Opportunities [O] 【O】 Growing demand for decarbonization • Sales expansion of DC meters and Green Transformation Stronger regulations and an
Slide 45: Fostering Management Conscious of Capital Cost and Stock Price (Updated)
Fostering Management Conscious of 5 Capital Cost and Stock Price (Updated) Copyright (C) 2024 OSAKI ELECTRIC CO., LTD. All Rights Reserved 45
Slide 46: 1. Current Situation
1. Current Situation ■ Although PBR is on an upward trend, it remains around 0.7 times, continuing to stay below 1.0 ■ Low PBR is primarily attributed to stagnant ROE ■ PER is also below the industry average. This suggests that expectations for our company’s future profit growth are low ※ Industry a
Slide 47: 2. Underlying Policy for Improving ROE
2. Underlying Policy for Improving ROE ■ Achieve 10% ROE early and aim for further improvement 【Revision of targets】 ■ The cost of equity capital is revised to 6.0% (5.2% for the FY2024). It is recognized that there is a discrepancy with the market’s expected return ■ Work towards improving ROE by e
Slide 48: 3. Scenario for Achieving 10% ROE in FY2026
3. Scenario for Achieving 10% ROE in FY2026 (as of May 2025) Initiatives to Improve ROE (1) Improving the net profit margin (2) Enhancing the total asset turnover ratio Japan ● Improve profitability through the full-scale rollout of second- generation smart meters ▸ Increase in volume starting in FY
Slide 49: 4. Measures to Improve ROE
4. Measures to Improve ROE Implement various initiatives to enhance profitability and optimize capital efficiency Status of key initiatives in FY2024 ● The performance for FY2024 (1) Profit model reform exceeded the initial forecast Top-priority initiative contributing to Japan Focused on additional
Slide 50: 4. (1) Profit Model Reform (Japan)
4. (1) Profit Model Reform (Japan) ■ Strengthen profitability by promoting key strategies in the Mid-Term Management Plan (FY2024 to FY2026) ［Key strategies］ Status of key initiatives in FY2024 ● Additional orders for the current smart meter have been secured through strengthened sales efforts ● Pre
Slide 51: 4. (1) Profit Model Reform (Overseas / Group management)
4. (1) Profit Model Reform (Overseas / Group management) ［Key strategies］ Status of key initiatives in FY2024 ● Preparations for Next-generation meter development Transforming into profit- and production for Oceania are progressing as planned oriented business ● Shipments to the UK are as planned •
Slide 52: 4. (1) Profit Model Reform (Profit Trends)
4. (1) Profit Model Reform (Profit Trends) Japan ● Securing revenue from the second-generation smart meters to be fully introduced from FY2025 ● Expanding revenue from solution businesses (GX services, smart locks, etc.) Overseas ● Enhancing sales of next-generation smart meters and C&I meters, shif
Slide 53: 4. (2) Streamlining of Assets
4. (2) Streamlining of Assets Status of key initiatives in FY2024 （1） Improving working capital efficiency Japan In anticipation of the transition to second-gen smart Appropriate controls and reduction of domestic and meters, appropriate inventory levels is maintained overseas inventories, trade rec
Slide 54: 4. (3) Shareholder Returns - Dividends
4. (3) Shareholder Returns - 1 Dividends Aiming to provide stable dividends under the dividend policy, with continuous dividend increases driven by profit growth ■ FY2024 annual dividend set at 22 yen, a 2 yen increase from FY2023 ■ In May 2025, the dividend policy for FY2025 onwards was revised wit
Slide 55: 4. (3) Shareholder Returns - Share buybacks
4. (3) Shareholder Returns - 2 Share buybacks Continuous review of share buybacks based on cash, capital needs, performance, stock price, and investment plans. Treasury shares will be capped at 5% of total shares, and unused shares will be retired. ■ Resolved to share buybacks in August 2024 ・ Perio
Slide 56: 4. (4) Proper Use of Cash (cash allocation)
4. (4) Proper Use of Cash (cash allocation) ・ Strengthening shareholder returns through increased dividends and treasury stock acquisitions Cash inflows Cash outflows Working capital Investment in existing business Net Cash Japan 5.5 billion yen Second-gen smart meters, Solutions business As of end
Slide 57: 5. Underlying Policy for Improving PER
5. Underlying Policy for Improving PER ■ Improving PBR requires enhancing PER by boosting market evaluation of future growth ■ Along with executing the new Mid-Term Management plan, we will focus on securing appropriate capital market evaluation (1) Promote sustainability management Status of key in
Slide 58: (Reference) Logic Tree for Improving PBR
(Reference) Logic Tree for Improving PBR Achieve an improvement in PBR through the enhancement of ROE and PER Revenue structure reform through the Improvement in profitability execution of the Mid-Term Management Plan Improve working capital efficiency Improving Capital Reduce non-operating assets R
Slide 59: OSAKI ELECTRIC CO., LTD.
OSAKI ELECTRIC CO., LTD. TSE Prime Market Code: 6644 ◼ Figures in the document are for reference and include unaudited figures. ◼ Forward-looking figures are based on data and information available up to the date of its announcement and may differ significantly from actual results. ◼ Please refrain