Terumo Corporation · TSE:4543
Terumo — H1 FY2018 Earnings Presentation
21 slides from Terumo's earnings presentation, Nov 8, 2018
Slide 1: Financial Results for the First Half of Fiscal Year Ending March 31, 2019 (FY2018)
— <TERUMO Financial Results for the First Half of Fiscal Year Ending March 31, 2019 (FY2018) Terumo Corporation Managing Executive Officer, Investor Relations, Corporate Communication Dept. Kazuaki Kitabatake November 8, 2018
Slide 2: First half results: year-on-year comparison
The main point of the first half results is that we achieved approximately the level of the guidance we revised when announcing results for the first quarter. This page is a year‐ on‐year comparison, and the next page will show a comparison versus guidance. First, the year‐on‐year comparison: Revenu
Slide 3: Comparison with guidance and Ashitaka Factory status
Here is the comparison with first‐half guidance. Revenue was 3 billion yen higher. This was influenced by dollar appreciation and yen depreciation, and correcting for that, the gap was 1.2 billion yen higher. Operating profit and adjusted operating profit results were more or less in line with guida
Slide 4: Adjustment items for adjusted operating profit
Now, I would like to explain about adjustment items for adjusted operating profit. Most of the adjustment is due to amortization of intangible assets, amounting to 7.5 billion yen. Temporary gain and loss amount to only 200 million yen, but within that number were actually large amounts that netted
Slide 5: Adjusted operating profit variance analysis
Next is the adjusted operating profit variance analysis. I will explain from the left to the right of the slide. The first increment in gross profit is the result of increased revenue. This was 2.5 billion yen higher year‐ on‐year in the first quarter, but lower year‐on‐year in the first half. There
Slide 6: Revenue by region
Revenue by region, as you have already seen, included in Japan good growth by businesses other than Cardiac & Vascular; General Hospital grew 4% and Blood Management grew 8%. However, the Cardiac & Vascular negative impact was large, leading to an overall negative 2% result. There was impact from Ca
Slide 7: Results by company
Results by company are as you have seen, and I will go into detail regarding those later. 7
Slide 8: Cardiac & Vascular company results
In Cardiac & Vascular, TIS was approximately as anticipated. Other areas maintained their good performance. Neurovascular in particular continued to show double‐digit growth, with its hydro coil product growing especially well. Further, WEB also grew well, especially in Europe. SOFIA, the aspiration
Slide 9: General Hospital company results
I think we can say that General Hospital had the best results of the three companies. As is written here, we saw healthy increases in both revenue and profit. First, in revenue, the Alliance Business in particular: Both Japan and outside Japan showed growth exceeding 20%. This is very high growth. I
Slide 10: Blood Management company results
Blood Management grew 1.3 billion yen, with blood center revenue growth a major driver. As we have previously mentioned, therapeutic apheresis saw special demands for new console in last fiscal year, and this year we see the return back from that which resulted in a year‐on‐year decrease. Regarding
Slide 11: Other topics
Next is other topics, but in the interest of time I will not go into these. However, in the business area, Sato also mentioned that we had General Hospital investment, and approvals of products, etc. 11
Slide 12: The pipeline
The pipeline is as you see here. 12
Slide 13: Convertible bonds
Finally, I want to explain a little bit about our convertible bonds. Three months ago, the amount of shares issued for conversion was 31.6 billion yen. However, in the three months since then, the amount of shares issued for conversion has increased approximately by 40 billion yen. This seems to be
Slide 14: Reference
“TERUMO Reference 14/21 14
Slide 15: 1H FY18 Revenue and Growth by Region
1H FY18 Revenue and Growth by Region (billion yen) Business Outside of Japan Japan ; G. Total Segment Subtotal Europe | Americas Cardiac and 223 131.1 39.4 59.5 17.0 15.3 153.5 Vascular (-15%) (+0%) (-2%) (42%) (41%) (4%) (3%) Out of C&V 16.8 105.3 31.3 45.6 15.8 12.5 122.1 Interventional Ge) (a%) (
Slide 16: Operating Expenses
Operating Expenses (billion yen) YoY% (FXN) Salaries & Wages 41.1 43.3 42.2 Sales Promotion 8.0 8.7 +0.7 +8% +8% Logistical Costs 6.1 6.6 +0.5 +8% +8% niuaaciien 6.9 69 0.0 0% +0% Amortization Others 19.4 21.6 +2.2 +11% +11% 81.4 87.0 SG&A Expenses Total (28.6%) (30.5%) +5.6 +7% +7% 18.3 23.8 R&D Ex
Slide 17: Quarterly Results
Quarterly Results (billion yen) FY17 Q2 Q3 a4 FY18 Q1 ey) (Jul-Sep) (Oct-Dec) (Jan-Mar) (Apr-Jun) (Jul-Sep) Revenue 145.3 152.3 150.8 143.0 142.0 TAS) 83.2 80.7 73.9 74.7 Gross Profit (54.7%) (54.6%) (53.5%) (55.8%) (52.6%) SG&A Expenses 41.2 43.8 45.9 43.5 43.5 (28.4%) (28.7%) (30.4%) (30.4%) (30.5
Slide 18: CAPEX and R&D Expenses
CAPEX and R&D Expenses Amortization Amortization (billion yen) of acquired of acquired 60.0 Expand investment in Intangibles intangible production capacity and and Goodwill assets space as well as IT —_ gaz 45.4 43.6 42.0 43.0 infrastructure in FY18 IFRS basis from FY17 si > Include intangible 23.2
Slide 19: Cash Flow
Cash Flow Operating CF Investment and Finance CF +39.1 -26.2 (billion yen) Income taxes Depraci- increaueof ation and working amorti- capital zation Others APEX a sO = Dividends Profit 180.7 before tax Cash at end of CAPEX = C.i.P. record basis Cash at end of FY17 Cash at end of each fiscal year is
Slide 20: Foreign Exchange Sensitivity
Foreign Exchange Sensitivity Annual impact of one-yen depreciation (billion yen) eee Revenue 1.6 0.8 2.0 Adjusted Operating Profit 0.0 0.5 1.0 <Reference> Impact when yen is depreciated by 10% North | Latin EMEA America | America Adjusted Operating -0.1 0.9 6.0 413} 7) a3) Profit ~“TERUMO 20/21 20
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