Hanwa Co., Ltd. · TSE:8078
Hanwa — FY2013 Earnings Presentation
27 slides from Hanwa's earnings presentation, May 20, 2014
Slide 1: Financial Results for the Fiscal Year ended March 31, 2014
FINANCIAL RESULTS for the Fiscal Year ended March 31, 2014 May 20, 2014 HANWA CO., LTD. Copyright 2014 Hanwa Co., Ltd. All Rights Reserved 1
Slide 2: Overviews of Financial Results
Overviews of Financial Results • Net sales Compared with the last year, net sales has reached to 1,682.5 billion yen, increased by 11.3%, due to increase in steel and petroleum/chemicals businesses. • Net income Net income was 7.8billion yen, mainly due to becoming profitable from upturn in market p
Slide 3: Operating Results (consolidated)
Operating Results ( consolidated ) （Millions of yen） Rate of FY2013 FY2012 changes ・Net sales has increased by 11.3% from the previous year, Net sales 1,682,503 1,511,324 +11.3％ due to revenue growth in steel and petroleum/chemicals Gross profit 51,365 44,762 +14.8％ businesses. SG&A expenses 35,112
Slide 4: Changes in Business results (consolidated)
Changes in Business results （ consolidated ） Net sales （100 millions of yen） The U.S. economy was healthy, there was 20,000 Year ended Interim period 17,500 16,825 no economic turmoil in Europe, but 15,642 15,113 economic growth was flat in China and 15,000 emerging countries. （forecast） 10,000 In J
Slide 5: Financial Position (consolidated)
Financial Position ( consolidated ) （Millions of yen） Rate of ・Total assets increased by 7% FY2013 FY2012 from the end of the previous change year, due to the increase of trade Total assets 593,351 552,908 +7.3% receivables and inventories with the increased sales volume ,and the rise in listed inve
Slide 6: Cash Flows Situation (consolidated)
Cash Flows Situation ( consolidated ) （Millions of yen） Net cash provided by operation was 0.3 billion FY2013 FY2012 change yen, due to the increase of capital requirement in spite of the increase of Cash flows from operating revenue. 343 19,380 -19,037 Operating activities Net cash used in Cash flo
Slide 7: Segment Information (consolidated)
Segment Information ( consolidated ) Net sales Segment income （Millions of yen） Rate of Rate of 2014/3 2013/3 2014/3 2013/3 change change Steel 811,096 718,170 +12.9% Steel 13,879 9,598 +44.6% Metal & alloys 97,995 94,766 +3.4% Metal & alloys 1,756 320 +448.8% Non-ferrous Non-ferrous metals 77,511 7
Slide 8: Steel Business Segment
Steel Business Segment （Millions of yen） Net sales Segment income Profit ratio FY2013 811,096 13,879 1.7% FY2012 718,170 9,598 1.3% There was strong demand for steel among manufacturers. Construction demand was higher as well because of private-sector logistics and retail projects, earthquake recons
Slide 9: Transaction volume in Steel Segment (unconsolidated)
Transaction volume in Steel Segment (unconsolidated) Stagnant international market prices and policy switch to focus on home market by domestic steelmaker made export volume from Japan decreased by 28%. On the contrary, domestic sales volume increased by 11% mainly due to volume increase in steel pr
Slide 10: Market Trend of Long Products
Market Trend of Long Products Prices of steel products were stagnant in this first quarter as a counteraction of speculative demands followed by the market surge in previous quarter. The market in second quarter bottomed out with tighter availability from improved construction activities. At the beg
Slide 11: Market Trend of Flat Products
Market Trend of Flat Products Factory utilization rate was steady, but spot market started late compared with long products. However, spot market in the second half of the year finally caught up with market improvement in revised contract price and tighter production availability. Currently, market
Slide 12: Market Trend of Steel Raw Materials
Market Trend of Steel Raw Materials Chinese spot price for imported iron ore went up from the summer of 2013 with expectation for a better economic upturn. Then, price plateaued for a while and weakened just before the 2014 Chinese New Year. Despite weak demand, import volume has been consistently h
Slide 13: Coking coal price and contract prices
【Coking coal price】 On the same token, spot price for 200 coking coal went up as well but Coking coal (US$：/FOB Australia) declined afterwards. 150 Long-term contract prices with mining companies rose in the first 100 quarter but fell down reflecting 50 weak spot market. 【Contract price between Mini
Slide 14: Markets Trend of Steel Scrap
Markets Trend of Steel Scrap Market price of steel scrap went up along with better construction demands after the summer of 2013. Shortage of construction labor forces after the New Year caused the sluggish shipment of steel products. Moreover, slow cargo movement reduced reception at several EAF du
Slide 15: Steel Market Trend in China
Steel Market Trend in China Crude steel production remained high with little moderation despite soft market demand. With expectation for government economic stimulus package or improved demand after Chinese New Year, temporary market improvement was observed, but lack of any substantial increase in
Slide 16: Metals & Alloys Business Segment
Metals & Alloys Business Segment （Millions of yen） Net sales Segment income Profit ratio FY2013 97,995 1,756 1.8% FY2012 94,766 320 0.3% Sales of ferrous alloys for steelmakers and nickel compounds improved despite weak demand of raw material for stainless steel. Earning increased further because of
Slide 17: Market Trend of Metals & Alloys
Market Trend of Metals & Alloys Stainless steel production in Japan improved from the latter half of the fiscal year, but overseas demand remained weak, thus prices of raw materials for stainless steel, such as nickel and stainless steel scraps, remained weak. Currently, market price of nickel rebou
Slide 18: Non-ferrous Metals Business Segment
Non-ferrous Metals Business Segment （Millions of yen） Net sales Segment income Profit ratio FY2013 77,511 835 1.1% FY2012 73,273 686 0.9% Although LME prices were weak, the yen’s decline kept yen-converted prices flat. Pressure on earnings continued as the smaller volume of scrap pushed up the cost
Slide 19: Markets Trend of Non-ferrous Metals
Markets Trend of Non-ferrous Metals LME prices were up and down in response to economic news but were generally soft. Currently, uncertainty in supply and demand in China made the market sluggish. 2,600 9,000 8,000 2,200 Al,An,Pb(US$/t) 7,000 Cu(US$/t) 6,000 1,800 Al 5,000 Zn Pb Cr 1,400 4,000 Copyr
Slide 20: Foods Business Segment
Foods Business Segment （Millions of yen） Net sales Segment income Profit ratio FY2013 78,668 1,589 2.0% FY2012 83,800 747 0.9% Demand in Japan was sluggish. But the yen’s decline raised the price of farmed salmon, which had been falling rapidly, and the price of shrimp, which was low. Higher prices
Slide 21: Market Trend of Frozen Marine Products
Market Trend of Frozen Marine Products Farmed salmon price turned upwards as the yen got weaker. Little availability accelerated market price, and current delay of arrival pushed soared market even further. There is a sharp decrease in shrimp production caused by the outbreak of epidemic at shrimp f
Slide 22: Petroleum & Chemicals Business Segment
Petroleum & Chemicals Business Segment （Millions of yen） Net sales Segment income Profit ratio FY2013 499,043 1,925 0.4% FY2012 444,280 1,673 0.4% Earning profits is difficult because of intense competition among sellers to end users as demand for industrial fuel remains sluggish. Earnings from synt
Slide 23: Market Trend of Crude Oil & Petroleum Products
Market Trend of Crude Oil & Petroleum Products Crude oil price moved up and down in response to many factors like events in Middle East and US debt problems alike. Currently, harsh winter in North America firmed up the market. High cost of crude oil coupled with weaker yen led to consistently high p
Slide 24: Other Segment
Other Segment （Millions of yen） Net sales Segment income Profit ratio FY2013 200,925 (262) (0.1%) FY2012 167,494 1,222 0.7% Sales of lumber products increased along with very strong housing demand in Japan. Also, weaker yen contributed to the increase in converted overseas sales in yen. However, ear
Slide 25: Progress of Business Strategy
Progress of Business Strategy 【Strengthening of Domestic Business】 M&A for strengthening of function Acquisition ownership of SanEi Metal Co., Ltd.(Oct-2013) Acquisition ownership of Hokuriku Column Co., Ltd.(Nov-2013) Promotion of business investment Equity investment in Nakayama Steel Works, Ltd (
Slide 26: Business Forecast FY2014 (year ending March 31, 2015)
Business Forecast FY2014 ( year ending March 31, 2015) Economic growth in China and other emerging countries is sluggish. Despite reduced expenditure at private sector due the consumption tax increase, Japanese economy, mainly in the construction sector, is expected to post solid growth with the eff
Slide 27: A Cautionary Note on Forward-looking Statement
A Cautionary Note on Forward-looking Statement This material contains statements (including figures) regarding Hanwa Co., Ltd. (“Hanwa”) ’s corporate strategies, objectives, and views of future developments that are forward-looking in nature and are not simply reiterations of historical facts. These