Nsk Ltd. · TSE:6471
Nsk — H1 FY2017 Earnings Presentation
30 slides from Nsk's earnings presentation, Nov 7, 2017
Slide 1: Financial Conference: Consolidated Business Results and Forecast
FINANCIAL CONFERENCE Consolidated Business Results and Forecast November 7, 2017 NSK Ltd. Cautionary Statements with Respect to Forward-Looking Statements Statements made in this report with respect to plans, strategies and future performance that are not historical fact are forward-looking statemen
Slide 2: Contents
Contents 1. Consolidated Business Results for the Six Months Ended September 30, 2017 2. Consolidated Business Forecast for the Year Ending March 31, 2018 3. Progress of the 5th Mid-Term Management Plan (Supplementary Information) 1
Slide 3: 1. Consolidated Business Results for the Six Months Ended September 30, 2017
1. Consolidated Business Results for the Six Months Ended September 30, 2017 2
Slide 4: Summary of Consolidated Business Results for the Six Months Ended September 30, 2017
Summary of Consolidated Business Results for the Six Months Ended September 30, 2017 Business Environment ✓ Global economy continued to see solid growth. Japanese yen weakened. ✓ Industrial machinery business： Clear recovery trend emerged, driven by robust capital expenditure in China. ✓ Automotive
Slide 5: Summary of Consolidated Business Results for the Six Months Ended September 30, 2017
Summary of Consolidated Business Results for the Six Months Ended September 30, 2017 FY2016 FY2017 Increase/ 1st half 1st half Difference 1st half Decrease (Billions of yen) <Actual> <Actual> YOY <FCST> YOY Net sales 455.6 493.3 +37.7 +8.3% 474.0 Operating income 27.3 42.7 +15.4 +56.4% 39.0 <%> ＜6.0
Slide 6: Sales & O.I. Results by Business Segment: Industrial Machinery Business
Sales & O.I. Results by Business Segment ー Industrial Machinery Business ー Ind BRG Precision O.I O.I(%) FY2016 FY2017 Increase/ FY2017 100 Difference 1st half 1st half Decrease st 1 half 8.8% YOY 8.1% 7.3% <Actual> <Actual> YOY <FCST> 6.8% 7.7% (Billions of yen) 80 2.9% Sales 107.9 126.9 +19.1 +17.7
Slide 7: Sales & O.I. Results by Business Segment: Automotive Business
Sales & O.I. Results by Business Segment ー Automotive Business ー Auto BRG Auto Comp O.I O.I(%) FY2016 FY2017 Increase/ FY2017 Difference 250 245 240 9.3% 9.5% 10.8% 9.9% 1st half 1st half Decrease st 1 half235 230 7.4% 7.9% YOY 225 <Actual> <Actual> YOY <FCST>220 215 (Billions of yen) 210 205 200 19
Slide 8: Operating Income: Factors Behind Change (FY2016 1st Half to FY2017 1st Half)
Operating Income: Factors Behind Change (FY2016 1st Half ⇒ FY2017 1st Half) (Billions of yen) Other operating expenses/ Equity method profits 42.7 Effect of +7.3 exchange rate fluctuations +4.7 Volume 27.3 Decline in sales price increase etc. +3.1 Increase Reduction of external -3.8 in costs procure
Slide 9: Sales Results by Customer Location
Sales Results by Customer Location FY2016 FY2017 Increase/ 1st half 1st half Difference 1st half Decrease (Billions of yen) <Actual> <Actual> YOY YOY <FCST> Net sales 455.6 493.3 +37.7 +8.3% 474.0 Japan 157.2 179.3 +22.1 +14.0% 174.5 Non-Japan 298.4 314.1 +15.7 +5.3% 299.5 <Non-Japan ratio> <65.5%>
Slide 10: 2. Consolidated Business Forecast for the Year Ending March 31, 2018
2. Consolidated Business Forecast for the Year Ending March 31, 2018 9
Slide 11: Summary of Consolidated Business Forecast for the Year Ending March 31, 2018
Summary of Consolidated Business Forecast for the Year Ending March 31, 2018 Forecasted Business Environment ✓ Moderate economic growth forecast to continue globally. ✓ Industrial machinery business: Driven by semiconductor and machine tool sectors and China-related demand. ✓ Automotive business: De
Slide 12: Summary of Consolidated Business Forecast for the Year Ending March 31, 2018 (FY2017)
Summary of Consolidated Business Forecast for the Year Ending March 31, 2018 (FY2017) FY2016 FY2017 Increase/ Full year 1st half 2nd half Full year Decrease Difference Full year <Actual> <Actual> ＜Revised FCST＞ ＜Revised FCST＞ YOY ＜May FCST＞ (Billions of yen) YOY Net sales 949.2 493.3 506.7 1000.0 +5
Slide 13: Forecast by Business Segment (FY2017)
Forecast by Business Segment (FY2017) FY2016 FY2017 Full year 1st half 2nd half Full year Increase/ Difference Full year ＜Revised ＜Revised Decrease (Billions of yen) <Actual> <Actual> YOY ＜May FCST＞ FCST＞ FCST＞ YOY Total Net sales 949.2 493.3 506.7 1000.0 +50.8 +5.4% 960.0 Operating income 65.3 42.7
Slide 14: Operating Income: Factors Behind Change (FY2016 to FY2017 Revised Forecast)
Operating Income: Factors Behind Change (FY2016 ⇒ FY2017 Revised Forecast) (Billions of yen) Other operating expenses/ Equity method profits 92.0 Effect of +16.5 exchange rate fluctuations +4.5 Volume 65.3 Decline in sales price Increase increase etc. +6.0 Reduction of external -5.5 in costs procure
Slide 15: Business Forecast by Customer Location (FY2017)
Business Forecast by Customer Location (FY2017) FY2016 FY2017 Increase/ Full year 1st half 2nd half Full year Decrease Difference Full year <Actual> <Actual> ＜Revised FCST＞ ＜Revised FCST＞ YOY ＜May FCST＞ (Billions of yen) YOY Net sales 949.2 493.3 506.7 1000.0 +50.8 +5.4% 960.0 Japan 330.5 179.3 187.
Slide 16: 3. Progress of the 5th Mid-Term Management Plan
3. Progress of the 5th Mid-Term Management Plan 15
Slide 17: The 5th MTP Concept
The 5th MTP Concept NSK Vision 2026 Setting the Future in Motion Embark on new chapter in evolution towards next 100 years Sustainable Growth Deliver new value to society Work together with stakeholders Operational Reconstruct profit base Innovate Excellence Increase and stabilize profitability Mono
Slide 18: Industrial Machinery Business: Business Environment and Forecast
Industrial Machinery Business: 1 Business Environment and Forecast Demand trend by Sector Sales Precision Machinery Forecast （Billions of yen） Forecast (Trend) (YOY) and Parts FY17 2H FY17 1H FY17 2H 300 276.4 Sector vs. to FY17 2H to FY18 1H 243.0 243.4 259.0 FY16 2H 44.0 226.9 55.0 ↑↑ ↑ ↑ Home App
Slide 19: Industrial Machinery Business: The 5th MTP: Status of Key Initiatives
Industrial Machinery Business: 2 The 5th MTP: Status of Key Initiatives MTP Key Initiatives Respond to changes in business environment and expand target fields ・FY2017/2H OI: recover to double-digit range. ・Expand presence over mid- to long-term and strive for prompt realization of 15% OI level. 1 R
Slide 20: Industrial Machinery Business: The 5th MTP: Status of Key Initiatives
Industrial Machinery Business: 3 The 5th MTP: Status of Key Initiatives ２ -2 Machine tools ２-1 ２２-2 -2 Wind Turbines ２２-3 -2 Railcars Further strengthen Global No.1 brand Reinforce competitiveness by promoting Expand business in China, 200 200 production at regions of end demand 200 enhance presence
Slide 21: Automotive Business: Vehicle Production and Business Forecast
Automotive Business： 1 Vehicle Production and Business Forecast Global Vehicle Production Volume Japan North America Europe China ASEAN6 Others （Billions of yen） Sales （unit : M） Source: IHS Automotive, NSK Estimates 100.0 94.4 95.2 800 713.0 87.8 89.1 705.5 696.3 85.8 657.0 Components Automotive 13
Slide 22: Automotive Business: The 5th MTP: Status of Key Initiatives
Automotive Business: 2 The 5th MTP: Status of Key Initiatives MTP Key Initiatives Mid- to long-term growth through core businesses and technology development toward a new automotive era 1 Powertrain Business 2 Steering and Actuator Business Expansion of powertrain products to continue Establish foun
Slide 23: Automotive Business: Future Automotive Technology (CASE)
Automotive Business: 3 The 5th MTP: Status of Key Initiatives 3 Future automotive technology 3２-1-2Flex corner module concept Technology changes Combination of driving and Radical innovation steering technology Autonomous driving CASE 1. Variolink suspension Steer-by-wire Automatic brake Variolink s
Slide 24: (Supplementary Information)
(Supplementary Information) 23
Slide 25: Quarterly Business Performance
(Supplementary Information) Quarterly Business Performance (Billions of yen) Net sales 300 242.1 251.5 243.8 249.5 231.8 223.8 200 100 0 FY16 Q1 Q2 Q3 Q4 FY17 Q1 Q2 (Billions of yen) Operating income Net income attributable to owners of the parent Operating income margin 40 9.6% 7.3% 8.1% 7.8% 6.3%
Slide 26: Sales & Operating Income Results by Business Segment
(Supplementary Information) Sales & Operating Income Results by Business Segment FY2016 FY2017 Increase/ 1st half 1st half Difference 1st half Decrease (Billions of yen) <Actual> <Actual> YOY <FCST> YOY Total Net sales 455.6 493.3 +37.7 +8.3% 474.0 Operating income 27.3 42.7 +15.4 +56.4% 39.0 <%> 6.
Slide 27: Sales and O.I. by Geographical Segment
(Supplementary Information) Sales and O.I. by Geographical Segment FY2016 FY2017 Increase/ 1st half Full year 1st half Decrease Difference Full year <Actual> <Actual> <Actual> YOY <May FCST> (Billions of yen) YOY Net sales 455.6 949.2 493.3 +37.7 +8.3% 1000.0 Japan 230.7 489.1 264.2 +33.5 +14.5% 549
Slide 28: Consolidated Balance Sheet
(Supplementary Information) Consolidated Balance Sheet Assets Liabilities / Total equity Non-Current assets Current liabilities Current assets Non- Current liabilities Total equity Change from Q4 (Billions of yen) Change from Q4 Ratio of net worth to total capital 1,086.4 (Billions of yen) 1,086.4 1
Slide 29: Inventories, Interest-bearing Debt, Capital Expenditure, Depreciation
(Supplementary Information) Inventories/Interest-bearing debt Capital Expenditure/Depreciation and amortisation Inventories Capital Expenditure Japan Non-Japan Inventory turnover 7.1 7.2 7.2 (Billions of yen) Japan Non-Japan 39.1 (Billions of yen) 143.0 131.8 17.9 125.8 24.2 19.5 76.2 81.6 90.3 10.4
Slide 30: Capital Expenditure, Depreciation and Amortisation, R&D Expenses
(Supplementary Information) Capital Expenditure, Depreciation and amortisation, R&D Expenses FY2016 FY2017 1st half FY2017 (Billions of yen) <Actual> <Actual> <Plan> Capital Expenditure 58.6 24.2 68.0 Depreciation and 43.4 23.0 45.0 amortisation R&D expenses （on Statutory basis） 13.9 8.2 *17.0 *Revi