Kurita Water Industries Ltd. · TSE:6370
Kurita Water Industries — FY2018 Earnings Presentation
32 slides from Kurita Water Industries's earnings presentation, May 14, 2019
Slide 1: Results Presentation for the Fiscal Year Ended March 31, 2019
Kurita Water Industries Ltd. Results Presentation for the Fiscal Year Ended March 31, 2019 (Securities code: 6370) May 14, 2019
Slide 2: Table of Contents
Table of Contents 1 Consolidated Financial Results for the Fiscal Year Ended March 31, 2019 p1-8 2 Consolidated Business Forecast for the Fiscal Year Ending March 31, 2020 p 9 -17 3 Review of First Year of Medium-Term Management Plan Maximize Value Proposition 2022 ( MVP-22) p 18 - 22 4 Priority Mea
Slide 3: Consolidated Financial Results for the Fiscal Year Ended March 31, 2019
Consolidated Financial Results for 1 the Fiscal Year Ended March 31, 2019
Slide 4: Overview of Results
Overview of Results Revised Forecast (Billions of Yen) FY ended 03/2018 FY ended 03/2019 Initial Forecast YoY Change (2/8) Orders 251.4 258.4 +2.8% 256.0 247.0 Net Sales 236.8 259.4 +9.5% 260.0 255.0 Operating Income 22.5 24.3 +8.2% 24.0 24.0 Ordinary Income 22.1 23.9 +8.2% 24.2 24.2 Extraordinary I
Slide 5: Results by Segment
Results by Segment (Billions of Yen) FY ended 03/2018 FY ended 03/2019 YoY Change ⚫ Both businesses achieved increases in sales and income Orders 251.4 258.4 +7.0 ⚫ The results of the Water Treatment Chemicals Business include the impact of Hansu, which Net Sales 236.8 259.4 +22.6 became a consolida
Slide 6: Water Treatment Chemicals
Water Treatment Chemicals (Billions of Yen) FY ended 03/2018 FY ended 03/2019 YoY Change ⚫ Domestic sales increased despite the absence of spot equipment projects that were posted in the Orders 90.4 102.9 +12.6 previous fiscal year. Domestic 44.5 46.2 +1.7 ⚫ Overseas sales increased considerably due
Slide 7: Water Treatment Facilities (for the domestic electronics industry)
Water Treatment Facilities (for the domestic electronics industry) (Billions of Yen) FY ended 03/2018 FY ended 03/2019 YoY Change ⚫ Orders and sales for facilities increased due to receiving orders for large projects related to Orders 55.3 61.8 +6.5 semiconductors, electronic components, and wafers.
Slide 8: Water Treatment Facilities (for domestic general industries)
Water Treatment Facilities (for domestic general industries) (Billions of Yen) FY ended 03/2018 FY ended 03/2019 YoY Change ⚫ Orders for facilities for electric power industry increased due to orders for large projects, and sales Orders 56.5 63.5 +7.0 also increased due to progress with construction
Slide 9: Water Treatment Facilities (Overseas)
Water Treatment Facilities (Overseas) (Billions of Yen) FY ended 03/2018 FY ended 03/2019 YoY Change ⚫ Although orders in China and South Korea decreased, sales increased due to progress in Orders 49.3 30.2 (19.1) construction work for large projects. Facilities 39.1 18.4 (20.7) ⚫ Orders and sales b
Slide 10: Financial Condition
Financial Condition (Billions of Yen) End of March 2018 End of March 2019 YoY Change ⚫ Non-current assets increased and liquidity on Cash, Deposits and hand decreased due to acquisitions in North 61.1 36.6 (24.5) America and investments in the ultrapure water Marketable Securities Other Current Asse
Slide 11: (Reference) Results for the Fiscal Year Ended March 31, 2019 (IFRS basis)
(Reference) Results for the Fiscal Year Ended March 31, 2019 (IFRS basis) (Billions of Yen) Voluntary Application of International Financial Reporting Standards (IFRS) from the First Quarter of the Fiscal Year Ending March 31, 2020 Consolidated Financial Results for the Fiscal Year Ended March 31, 2
Slide 12: Consolidated Business Forecast for the Fiscal Year Ending March 31, 2020
Consolidated Business Forecast for 2 the Fiscal Year Ending March 31, 2020
Slide 13: Business Environment
Business Environment (Billions of Yen) Water Treatment Chemicals Business ⚫ Production activity in domestic manufacturing industries is expected to remain steady. ⚫ It is assumed that there are risks for an economic downturn such as intensification of trade friction between the U.S. and China, a slo
Slide 14: Overview of Business Forecast
Overview of Business Forecast FY ended 03/2019 FY ended 03/2019 FY ending 03/2020 (Billions of Yen) (Results) (Results) (Forecast) YoY Change (Japanese GAAP) (IFRS Reference Values) (IFRS) Orders 258.4 258.4 270.0 +4.5% Net Sales 259.4 257.3 278.0 +8.1% Business Profit — 26.0 26.5 +2.0% Other Income
Slide 15: Forecast by Segment
Forecast by Segment FY ended 03/2019 FY ended 03/2019 (Results) FY ending 03/2020 ⚫ In the Water Treatment Chemicals Business, there (Billions of Yen) (Results) (Forecast) YoY Change (Japanese GAAP) (IFRS Reference (IFRS) will no longer be amortization of goodwill in SG&A Values) expenses, but acqui
Slide 16: Water Treatment Chemicals Business
Water Treatment Chemicals Business FY ended 03/2019 FY ended 03/2019 FY ending 03/2020 (Billions of Yen) (Results) (Results) (Forecast) YoY Change ⚫ Sales in North America are expected to increase (Japanese GAAP) (IFRS Reference Values) (IFRS) due to the new consolidation of U.S. Water. Orders 102.9
Slide 17: Water Treatment Facilities (for the domestic electronics industry)
Water Treatment Facilities (for the domestic electronics industry) FY ended 03/2019 FY ended 03/2019 (Results) FY ending 03/2020 ⚫ Orders and sales of facilities are expected to remain (Billions of Yen) (Results) (Forecast) YoY Change (IFRS Reference at a high level but decrease. (Japanese GAAP) (IF
Slide 18: Water Treatment Facilities (for domestic general industries)
Water Treatment Facilities (for domestic general industries) FY ended 03/2019 FY ended 03/2019 FY ending 03/2020 ⚫ Orders for facilities for the electric power industry (Billions of Yen) (Results) (Results) (Forecast) YoY Change are expected to decrease compared to the previous (IFRS Reference (Japa
Slide 19: Water Treatment Facilities (Overseas)
Water Treatment Facilities (Overseas) FY ended 03/2019 FY ended 03/2019 FY ending 03/2020 (Billions of Yen) (Results) (Results) (Forecast) YoY Change ⚫ Orders from China and South Korea are expected to (Japanese GAAP) (IFRS Reference Values) (IFRS) decrease by around 10%. Sales are expected to Order
Slide 20: Breakdown of Service Business Sales
Breakdown of Service Business Sales FY ended 03/2019 FY ended 03/2019 FY ending 03/2020 ⚫ Factors increasing revenue are expected to (Billions of Yen) (Results) (Results) (Forecast) YoY Change outweigh factors reducing revenue in the ultrapure (IFRS Reference (Japanese GAAP) (IFRS) Values) water sup
Slide 21: Capital Expenditures, Depreciation and R&D Expenses
Capital Expenditures, Depreciation and R&D Expenses FY ended 03/2019 FY ended 03/2019 (Results) FY ending 03/2020 ⚫ Capital expenditures in the ultrapure water supply (Billions of Yen) (Results) (Forecast) YoY Change (IFRS Reference business increased significantly in the fiscal year (Japanese GAAP)
Slide 22: Maximize Value Proposition 2022 (MVP-22)
Review of First Year of Medium-Term Management Plan 3 Maximize Value Proposition 2022 ( MVP-22 )
Slide 23: Progress and Results of Measures
Progress and Results of Measures Advances were made toward establishing an earnings base due to progress made with the measures Priority Measures Progress Issues and Achievements • Groupwide realization of wastewater 1 Development of CSV Business reclamation, energy saving and waste • Achievement of
Slide 24: Development of CSV Business
Development of CSV Business Contract-type business that shares benefits with customers Customer’s Development of new plant Remote applications for monitoring reclaimed water IoT Utility facilities Supply of reclaimed water Air conditioning Wastewater reclamation system Manufacturing (Assets owned by
Slide 25: Expansion of North American Business Base
Expansion of North American Business Base Providing total solutions from a network expanding across the United States U.S. Water (head office) Fremont APANA (head office) Avista Technologies ⚫ U.S. Water (head office) ⚫ U.S. Water (sales office) ⚫ U.S. Water (production site) Kurita America ⚫ Equity
Slide 26: Results of Allocation of Funds
Results of Allocation of Funds Active investment in promising businesses and diversification of sources of funds 74.1 billion yen Dividends ⚫ Continuation of dividend increases 50.8 billion yen ⚫ Acquisition of business base for water M&A Sale of shares of other treatment chemicals and water treatme
Slide 27: Initiatives to Strengthen Corporate Governance
Initiatives to Strengthen Corporate Governance Initiatives in the Fiscal Year Results Ended March 31, 2019 Management Reform Executive Officer system Enhanced awareness of role as supervision and • Change employment contracts to commission contracts Executive Officer and improved execution • Change
Slide 28: Priority Measures
@ Kurita 4 Priority Measures
Slide 29: Acceleration of Deployment of Total Solutions (1)
Acceleration of Deployment of Total Solutions (1) Transformation of sales system aimed at provision of total solutions FY ended 03/2019 FY ending 03/2020 Reorganization Solution Business Division Solution Business Division Overseas sales of business Overseas sales Engineering Division Engineering Di
Slide 30: Acceleration of Deployment of Total Solutions (2)
Acceleration of Deployment of Total Solutions (2) Deeper solution model and faster Profitability improvement market ▶ Accumulation and expansion deployment of introduction results ▶ Horizontal deployment of solution model ▶ Creation/integration of solution model details ▶ Development of solution mod
Slide 31: Acceleration of Deployment of Total Solutions (3)
Acceleration of Deployment of Total Solutions (3) Global deployment of total solutions EMEA North America Asia Improvement of Rapid PMI and early profitability through Strengthening of sales system establishment of system for horizontal development and acquisition of business provision of total solu
Slide 32: Forward-looking Statements
Forward-looking Statements This presentation contains forward-looking statements, business plan projections, and judgments based on information available to management at the time of writing. Due to the existence of a variety of risk factors and uncertainties, actual results may differ from those sp
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