Nagase & Co., Ltd. · TSE:8012
Nagase & — Q1 FY2024 Earnings Presentation
27 slides from Nagase &'s earnings presentation, Aug 8, 2024
Slide 1: FY2024 First Quarter Financial Briefing
FY2024 First Quarter Financial Briefing NAGASE&CO.,LTD. Stock exchange listing : Tokyo (Prime Market) Code number : 8012 August 8, 2024 Copyright © 2024 Nagase & Co., Ltd.
Slide 2: Review: Management Conscious of Capital Costs and Share Prices
Review : Management Conscious of Capital Costs and Share Prices ー From the FY2023 Financial Briefing ー Policies to Enhance Corporate Value Execute growth, financial, and capital strategies set forth in the Medium-Term Management Plan ACE 2.0 Current Issue Recognition PBR has been below 1x since FY
Slide 3: Contents
Contents ■ Consolidated Statements Income P３ ■ Gross Profit by Region P４ ■ Gross Profit by Business & Segment P５ ■ Operating Income by Business & Segment P６ ■ Sales, Gross Profit and Operating Income by Quarter P7 ■ Segment Overview P8～P15 ■ Overview of Major Manufacturing Subsidiaries P16 ■ Consoli
Slide 4: Consolidated Statements Income
Consolidated Statements Income Gross profit was the highest ever for a first quarter; gross profit margin improved across all business segments Operating income increased and operating income ratio improved despite higher selling, general and administrative expenses, stemming from increased logistic
Slide 5: Gross Profit by Region
Gross Profit by Region Higher profit both domestic and overseas Increase in domestic business sales, mainly due to higher sales of formulated epoxy resins for semiconductor applications and sales of raw materials Overseas profit increased, mainly due to the impact of the weak yen and improved profit
Slide 6: Gross Profit by Business & Segment
Gross Profit by Business & Segment Functional Materials saw an increase in profit with higher sales of coating materials and raw materials for the electronics industry, including semiconductor-related products; in addition, the color formers business (manufacturing business of the digital print proc
Slide 7: Operating Income by Business & Segment
Operating Income by Business & Segment Despite strong sales of formulated epoxy resins by Nagase ChemteX and narrowed losses in the color formers business, manufacturing business operating income decreased overall, mainly due to the impact of lower profit in the Prinova Group Corporate & Others incr
Slide 8: Sales, Gross Profit and Operating Income by Quarter
Sales, Gross Profit and Operating Income by Quarter Ongoing strong performance in the second half of FY2023 100 millions of yen FY2024 Quarterly results 1Q forecast FY2023 １Q ２Q ３Q ４Q YTD Actual Sales FY2024 2,392 2,392 9,400 FY2023 2,240 2,261 2,275 2,224 2,240 9,001 YoY% 6.8% 6.8% 4.4% Gross profi
Slide 9: Segment Overview: Functional Materials
Functional Materials Segment Overview Sales of coating materials rose, mainly due to strong sales to the automobile industry Sales increased for raw materials for the electronics industry, including semiconductor-related products Losses narrowed in the color formers business (digital print processin
Slide 10: Topics: Improve Business Initiatives
Functional Materials Topics: Improve Business Initiatives We halted production at SOFIX, a color formers manufacturing subsidiary, last fiscal year We made the decision to withdraw from the color formers business in the U.S. SOFIX LLC Color formers manufacturing and sales base in Tennessee, U.S.A.,
Slide 11: Segment Overview: Advanced Materials & Processing
Advanced Materials & Processing Segment Overview Resin sales increased with the recovery in demand for office equipment applications in the electric and electronic industries Sales of resin mold products increased for the manufacturing sector Operating income increased due to an increase in gross pr
Slide 12: Segment Overview: Electronics & Energy
Electronics & Energy Segment Overview Sales of materials to the semiconductor industry increased due to the moderate market recovery Sales of materials for electronic devices increased due to higher demand Sales of formulated epoxy resins increased high-end server applications and mobile device appl
Slide 13: Topics: Semiconductor-Related Developments
Electronics & Energy Topics: Semiconductor-Related Developments Expanding business in advanced semiconductors for high-end servers Pursuing proposals for new concept materials (a-SMC: advanced sheet molding compound) aiming to become the de facto standard for the next generation; with expected stron
Slide 14: Segment Overview: Mobility
Mobility Segment Overview Despite the impact of lower production volume among Japanese customers in China, Resin sales increased with the global increase in automobile production volume Sales increased in functional materials and functional components for interior and exterior fittings and electrifi
Slide 15: Segment Overview: Life & Healthcare
Life & Healthcare Segment Overview Prinova Group recovered profitability and increased sales year on year, after the decline in the food ingredients market in the previous year Nagase Viita cosmetic material sales increased in Japan, but declined overseas due to inventory adjustments, etc., among cu
Slide 16: Topics: Current Status of the Prinova Group
Life & Healthcare Topics: Current Status of the Prinova Group Trading company business continued to see an increase in sales volume and improving profit margins Manufacturing is making progress in efficiency with production system concerns resolved; we expect profits to recover beginning in the seco
Slide 17: Overview of Major Manufacturing Subsidiaries
Overview of Major Manufacturing Subsidiaries Nagase ChemteX: Increase in operating income due to strong sales of formulated epoxy resin used in high-end server applications Nagase Viita: Despite strong domestic sales of food products and cosmetic ingredients, operating income decreased due to lower
Slide 18: Consolidated Balance Sheets
Consolidated Balance Sheets Working capital increased due to strong performance and the impact of the weak yen (US$ conversion rate: ¥151.4 (March 31, 2024); ¥161.1 (June 30, 2024) (RMB conversion rate: ¥20.8 (March 31, 2024); ¥22.0 (June 30, 2024) 100 millions of yen 2024/03 2024/06 Change Details
Slide 19: Consolidated Cash Flows
Consolidated Cash Flows Profit attributable to owners of the parent increased due to strong business performance; however, working capital also increased, resulting in a ¥3.0 billion outflow in CF from operations 100 millions of yen FY2023 1Q FY2024 1Q Operating CF 158 (30) (Income before income tax
Slide 20: FY2024 Earnings Projection (No Change)
FY2024 Earnings Projection (No Change) We expect to increase manufacturing earnings in our semiconductor-related and food-related businesses We expect trading business resin sales to recover, while the automobile-related business should also see firm performance We expect selling, general and admini
Slide 21: FY2024 Earnings Projection By segment (No Change)
FY2024 Earnings Projection By segment (No Change) Higher sales and profit in Functional Materials recorded, mainly due to increased automobile-related sales and narrower losses in the color formers business Higher sales and profit in Advanced Materials & Processing, mainly due to increased sales of
Slide 22: Shareholder Returns
Shareholder Returns We plan to pay an interim dividend of ¥40 per share and a year-end dividend of ¥45 per share for an annual dividend of ¥85 per share for fiscal 2024 (expected 15th consecutive fiscal year of dividend increases) We changed our policy for shareholder returns compared under ACE 2.0
Slide 23: Notice: Relocation of Nagoya Branch Office
Notice: Relocation of Nagoya Branch Office Nagoya Branch moved to new location and started operations on July 16, 2024 As with the Tokyo Head Office, this new office is an activity based workplace (ABW), fostering an environment that encourages diverse and creative work styles About the New Nagoya O
Slide 24: 第3回 NAGASE カップ @国立競技場
ご参加・ご来場をお待ちしております！ 2024年10月12日（土）・13日（日） 第３回NAGASEカップ ＠国立競技場 入場無料 Copyright © 2024 Nagase & Co., Ltd.
Slide 25: Inquiries and Investor Relations Website
■Inquiries: https://www.nagase.co.jp/english/contact/ir/ ■NAGASE Group Investor Relations Website: https://www.nagase.co.jp/english/ir/ These presentation materials contain projections based on forward-looking assumptions, forecasts, and plans as of August 5, 2024 Actual earnings may differ from pro
Slide 26: Sales, Gross Profit, and Operating Income by Quarter (Before Allocation)
Sales, Gross Profit, and Operating Income by Quarter (Before Allocation of Corporate & Others) In FY2024, the Company began allocating company-wide shared expenses, excluding a portion of Nagase non-consolidated expenses, to business units under Corporate & Others We are allocating company-wide shar
Slide 27: Review: Business Environment by Segment
Review : Business Environment by Segment ー From the FY2023 Financial Briefing ー Industry FY2023 Trends FY2024 Trends Segment Gradual recovery in automotive Automotive applications to remain strong, Coatings applications, but sluggish construction- but generally flat overall related applications Func