Sumitomo Heavy Industries, Ltd. · TSE:6302
Sumitomo Heavy Industries — FY2016 Earnings Presentation
33 slides from Sumitomo Heavy Industries's earnings presentation, May 2017
Slide 1: Financial Summary for FY2016, Projections for FY2017 and Medium-Term Management Plan 2019
Financial Summary for FY2016, Projections for FY2017 and “Medium-Term Management Plan 2019” May 2017 President and CEO Shunsuke Betsukawa Copyright © Sumitomo Heavy Industries, Ltd. All Right Reserved. 1
Slide 2: Index
May 2017 INDEX 01 Financial Summary for FY2016 02 Performance Forecast for FY2017 03 “Medium-Term Management Plan 2019” Copyright © Sumitomo Heavy Industries, Ltd. All Right Reserved. 2
Slide 3: Financial Summary for FY2016
May 2017 01 Financial Summary for FY2016 Copyright © Sumitomo Heavy Industries, Ltd. All Right Reserved. 3
Slide 4: Financial Summary
May 2017 01 Financial Summary Unit: JPY billion Key points FY2015 FY2016 Change (1) Orders ・Decreases in Machinery Components, Construction Machinery and Industrial Machinery segments. Orders 685.9 711.1 25.2 Increases in Ships, and Environmental Facilities & Plant segments as compared to the prev
Slide 5: Operating Income by Segment
May 2017 01 Operating Income by Segment Unit: JPY billion Comparison with same term previous fiscal year FY2015 FY2016 Change <Machinery Components> Increase in profits mainly due to strong growth Machinery for small-to-medium scale models from both domestic and overseas markets. components 8.9 9.
Slide 6: Consolidated Balance Sheet
May 2017 01 Consolidated Balance Sheet Unit: JPY billion March March March March Change Change 2016 2017 2016 2017 Current assets 493.0 507.6 14.6 Liabilities 400.0 387.3 (12.7) Notes and accounts Cash and deposits * 70.8 63.8 (7.0) payable 142.3 147.3 5.0 Notes and accounts receivable 219.9 242.5 2
Slide 7: Consolidated Cash Flow Statement
May 2017 01 Consolidated Cash Flow Statement Significant increase in operating CF due to improvements in working capital. Active approach to investments Unit: JPY billion Category FY2015 FY2016 Change Operating activities 18.3 38.2 19.8 Income before income taxes 47.2 47.3 0.1 Depreciation 19.7
Slide 8: Ref. Overseas sales by regional segment
May 2017 Ref. Overseas sales by regional segment Unit：JPY billion Total Hydraulic Excavators FY2015 FY2016 FY2015 FY2016 Sales Sales ratio Sales Sales ratio Sales Sales ratio Sales Sales ratio North America 120.8 17.2% 107.9 16.0% 30.4 20.6% 28.9 20.8% Europe 66.6 9.5% 53.5 7.9% 22.3 15.2% 14.1 10.1
Slide 9: Performance Forecast for FY2017
May 2017 02 Performance Forecast for FY2017 Copyright © Sumitomo Heavy Industries, Ltd. All Right Reserved. 9
Slide 10: Performance Forecast for FY2017
May 2017 02 Performance Forecast for FY2017 Dividend for FY2016 was JPY16, JPY2 higher than the initial dividend forecast of JPY14. Projections for FY2017 are for increased sales but decreased profits (net income), so dividends will remain at 16 yen for the year. Unit: JPY billion Actual Actual
Slide 11: Machinery Components
May 2017 02 Machinery Components FY2016 : Both orders and sales fell as compared to the previous fiscal year mainly due to a continued decline in domestic and overseas market conditions for large-scale models. Strong growth seen for small- to-medium scale gear reducers particularly from the domestic
Slide 12: Precision Machinery
May 2017 02 Precision Machinery <Plastic machinery> FY2016 : Both orders and sales fell as compared to the previous fiscal year mainly due to weak electrical and electronics related demand from China and other markets. Strong demand from markets in Europe. FY2017 : Electrical and electronics related
Slide 13: Construction Machinery
May 2017 02 Construction Machinery <Hydraulic excavators> FY2016 : Demand for China bottomed out while increased market share offset a fall in demand from domestic and North American markets. Impact from currency exchange rates resulted in both a drop in orders and sales. FY2017: Slight increases fo
Slide 14: Industrial Machinery
May 2017 02 Industrial Machinery FY2016 : Orders for industrial cranes increased as a result of the merger of Mitsubishi Heavy Industries’ crane business. However, orders across the entire segment decreased mainly due to a drop in orders for medical systems, presses and turbines. FY2017 : Orders for
Slide 15: Ships
May 2017 02 Ships FY2016 : Although market conditions were sluggish, the segment secured order for three new vessels, an increase of one vessel as compared to the previous fiscal year. Three vessels were handed over, which was the same number as the previous fiscal year. FY2017 : The shipbuilding in
Slide 16: Environmental Facilities and Plants
May 2017 02 Environmental Facilities and Plants FY2016 : The segment secured orders for Japan’s largest biomass-fueled power generation plant as well as a large-scale ash treatment plant. The water treatment plant was also able to secure orders for a long-term operation and maintenance contract. As
Slide 17: Performance Forecast for FY2017 by Segment
May 2017 02 Performance Forecast for FY2017 by Segment Unit: JPY billion Actual Actual Forecast Forecast Actual Forecast 1H-FY16 2H-FY16 1H-FY17 2H-FY17 FY2016 FY2017 Orders 50.7 46.8 51.0 54.0 97.4 105.0 Machinery Net sales 48.9 49.7 50.0 53.0 98.6 103.0 components Operating income 4.1 5.0 4.5 5.5
Slide 18: Medium-Term Management Plan 2019
May 2017 03 “Medium-Term Management Plan 2019” Copyright © Sumitomo Heavy Industries, Ltd. All Right Reserved. 18
Slide 19: Result of MTMP16
May 2017 03 Result of “MTMP16” Overall Unit：JPY billion FY14 FY15 FY16 Three-Year Total Plan Actual Difference Plan Actual Difference Plan Actual Difference Plan Actual Difference Sales 650.0 667.1 17.1 670.0 700.8 30.8 700.0 674.3 (25.7) 2,020.0 2,042.3 22.2 Operating income 37.0 46.0 9.0 49.0 50
Slide 20: Result of MTMP16 by Segment
May 2017 03 Result of “MTMP16” by Segment Orders Net Sales As a result of the strong order environment, record sales figures After posting record orders in FY2014, orders dropped in FY2015 were recorded for two consecutive years in FY2014 and FY2015. mainly due to the decline in demand for hydraulic
Slide 21: Result of MTMP16 by Segment
May 2017 03 Result of “MTMP16” by Segment Net Sales Operating income Operating income ratio was 7.2% in FY2015 and FY2016 As a result of the strong order environment, record sales figures meaning that the target established in the MTMP16 was almost were recorded for two consecutive years in FY2014 a
Slide 22: Result of MTMP16: Activities, Results, Towards the Next MTMP
May 2017 03 Result of “MTMP16” ＜ Overall Activities ＞ ＜ Results ＞ "Steady growth" Globalization Weakness in forecasting the Become number one globally in the CFB boiler field. external environment meant that Develop new products for Japan and Europe with the aim to although targets for year 1
Slide 23: Medium-Term Management Plan 2019 Basic Concept
May 2017 03 “Medium-Term Management Plan 2019” Basic Concept Corporate Mission Statement We will aim to become a machinery manufacturer that continues to provide excellent products and services to the Pursue world. corporate With integrity being a key principle in the Group, we will mission contribu
Slide 24: Medium-Term Management Plan 2019 Overall Plan
May 2017 03 “Medium-Term Management Plan 2019” Overall Plan Overall Plan Unit：JPY billion FY16 Actual FY17 Plan FY19 Target Net Sales 674.3 710.0 800.0 Operating income 48.4 51.0 60.0 Operating income ratio 7.2% 7.2% 7.5% ROIC 7.3% 7.3% Over 7.5% Projected currency exchange rate ￥108 ¥110 (US doll
Slide 25: Medium-Term Management Plan 2019 Capital Policy
May 2017 03 “Medium-Term Management Plan 2019” Capital Policy Capital Policy Prioritize growth-related investments (e.g. capital investments, M&A) Maintain a consolidated dividend payout ratio of 30% with regard to shareholder returns. If too much retained earnings are held, consider implement
Slide 26: Principal Measures by Segment
May 2017 03 “Medium-Term Management Plan 2019” Principal Measures by Segment FY16 Actual FY19 Target Unit：JPY billion Segment Operating Operating Principal Measures Net Sales Net Sales income income ・Establish manufacturing framework that allows for the early launch of new products that responds to
Slide 27: Position by Segments
May 2017 03 “Medium-Term Management Plan 2019” Position by Segments Role Growth & High Improve Stabilize Profit Profitability Profitability Margins Aim to achieve growth Aim to achieve growth while maintaining high Ensure a stable level of while improving levels of profitability profit Positioning p
Slide 28: About recently M&A: Mobile Cranes
May 2017 03 About recently M&A 【Mobile Cranes】 Consolidation of Hitachi Sumitomo Heavy Industries Construction Crane Co., Ltd. (HSC) into a subsidiary of SHI Production, repair and sale of construction machinery including crawler cranes and other related equipment and tools Established in 2002 b
Slide 29: About recently M&A: Cryogenic equipment
May 2017 03 About recently M&A 【Cryogenic equipment】 Expand semiconductor production equipment business Acquired shares in Persimmon Technologies Corporation Enhanced line-up of peripheral products in order to expand sales of cryo-pumps Expand and develop products in other segments using next-
Slide 30: About recently M&A: CFB Boilers
May 2017 03 About recently M&A 【CFB Boilers】 Acquired the CFB boiler business of Amec Foster Wheeler Plant engineering and services relating to CFB boiler based power generation facilities Holds number one spot in the world for the delivery of CFB units Promote growth strategies in the energy
Slide 31: Organizational Integrations and Alliances
May 2017 03 Organizational Integrations and Alliances Segment Outline Purpose Concentrate management Transfer large-scale gear reducer business of resources and improve Machinery Integration Sumitomo Heavy Industries Ltd. to Sumitomo competitiveness of the components Heavy Industries Gear Box Co., L
Slide 32: Long-Term Objectives and Key areas of CSR
May 2017 “Medium-Term Management Plan 2019” 03 Long-Term Objectives and Key areas of CSR Long-Term Objectives Key areas 1.The SHI Group will provide products and services that Key areas Purpose contribute towards both economic and technological development that targets the realization of a sustainab
Slide 33: Forward-looking statements
May 2017 All forward-looking statements regarding the company’s future performance are based on information currently available to Sumitomo Heavy Industries and determined subjectively. Future performance is not guaranteed and all information related to future performance contained herein is subject
Sumitomo Heavy Industries — FY2016 Earnings Presentation on 6ix