Sumitomo Heavy Industries, Ltd. · TSE:6302
Sumitomo Heavy Industries — Q2 FY2015 Earnings Presentation
28 slides from Sumitomo Heavy Industries's earnings presentation, Oct 30, 2015
Slide 1: Second Quarter Financial Summary and Projections for FY2015
Second Quarter Financial Summary and Projections for FY2015 October 30, 2015 President and CEO Shunsuke Betsukawa Copyright © Sumitomo Heavy Industries, Ltd. All Right Reserved. 1
Slide 2: Index
October 30, 2015 INDEX 01 Financial Summary for 2Q-FY2015 2Q-FY2015 Financial Summary | Operating Income by segment | Consolidated Balance Sheet | Consolidated Cash Flow Statement | Net sales by area 02 Performance Forecast for FY2015 Performance Forecast for FY2015 | Machinery Components | Precisio
Slide 3: Financial Summary for 2Q-FY2015
October 30, 2015 01 Financial Summary for 2Q-FY2015 Copyright © Sumitomo Heavy Industries, Ltd. All Right Reserved. 3
Slide 4: Financial Summary: Key points
October 30, 2015 01 Financial Summary Key points Unit: JPY billion (1) Orders FY2014 FY2015 Change • Decreased as compared to previous term 1H 1H due to reductions in the Construction Machinery and Ships segments despite Orders 365.5 356.3 (9.2) significant increases in the Machinery Components, P
Slide 5: Operating Income by Segment
October 30, 2015 01 Operating Income by Segment Unit: JPY billion Comparison with same term previous fiscal year FY2014 FY2015 Change <Machinery Components> 1H 1H Although the domestic, North American and Machinery Eurozone markets (for small to medium-sized models) trended positively, overall gro
Slide 6: Consolidated Balance Sheet
October 30, 2015 01 Consolidated Balance Sheet Unit: JPY billion March September March September Change Change 2015 2015 2015 2015 Current assets 492.0 469.5 (22.5) Liabilities 420.9 389.7 (31.2) Notes and accounts Cash and deposits * 92.4 59.7 (32.7) payable 140.4 132.2 (8.2) Notes and accounts Adv
Slide 7: Consolidated Cash Flow Statement
October 30, 2015 01 Consolidated Cash Flow Statement Operating cash flow was negative due to an increase in working capital. Unit: JPY billion FY2014 FY2015 Category Change 1H 1H Operating activities 31.9 (7.8) (39.7) Income before income taxes 19.7 16.6 (3.1) Depreciation 8.0 9.6 1.5 Working capi
Slide 8: Overseas Sales
October 30, 2015 01 Overseas Sales The domestic sales trended positively in the first half of FY2015 as compared to the previous term, but China decreased (16% reduction). Unit: JPY billion Overseas Sales by Regional Segment 1H-FY2015 Overseas Sales by Segment (15%) Environmental Unit: JPY billion
Slide 9: Performance Forecast for FY2015
October 30, 2015 02 Performance Forecast for FY2015 Copyright © Sumitomo Heavy Industries, Ltd. All Right Reserved. 9
Slide 10: Performance Forecast for FY2015
October 30, 2015 02 Performance Forecast for FY2015 Full-year operating income forecast is revised downwards from initial figures due to sluggish operating environment in Construction Machinery segment. Dividend forecast remains the same as initial forecast at JPY14 per share. Unit: JPY billion
Slide 11: Machinery Components
October 30, 2015 02 Machinery Components 1H of FY2015 : Both orders and sales increased as compared to the previous term due to positive conditions in the domestic, North American and Eurozone markets for small to medium-sized gear reducers as well as precision gear reducers, despite the downturn in
Slide 12: Precision Machinery
October 30, 2015 02 Precision Machinery <Plastic machinery> 1H of FY2015 : Orders and sales increased as compared to the previous term due to positive conditions in the domestic, Eurozone and North American markets, despite the slowdown in IT-related demand from Asia. Operating income also grew sign
Slide 13: Construction Machinery
October 30, 2015 02 Construction Machinery <Hydraulic excavators> 1H of FY2015 : Orders and sales decreased as compared to the previous term due to the significant drop in demand from the Chinese market, and the slowdown in demand from the domestic market because of the rush to place orders in respo
Slide 14: Industrial Machinery
October 30, 2015 02 Industrial Machinery 1H of FY2015 : Orders for industrial cranes from the domestic shipbuilding sector and turbines from the overseas power generating related sector trended positively. Under Industrial Equipment business unit, an order for a proton cancer therapy equipment was s
Slide 15: Ships
October 30, 2015 02 Ships 1H of FY2015 : The market conditions for medium-range tankers were comparatively strong with orders for two vessels received during the current period (three vessels decreased as compared to the previous period). One vessel was handed over during the current period, which i
Slide 16: Environmental Facilities and Plants
October 30, 2015 02 Environmental Facilities and Plants 1H of FY2015 : Orders grew in the boiler business due to demand from the overseas IPP sector and domestic biomass power generation facilities. Orders in the water treatment plant business also grew as compared to the previous term due to the aw
Slide 17: Performance Forecast for FY2015 by Segment
October 30, 2015 02 Performance Forecast for FY2015 by Segment Unit: JPY billion Record Record Record Forecast Record Forecast 1H-FY14 2H-FY14 1H-FY15 2H-FY15 FY2014 FY2015 Orders 51.4 53.3 54.0 56.0 104.7 110.0 Machinery Net sales 48.4 54.2 52.3 57.7 102.6 110.0 components Operating income 3.4 3.2
Slide 18: Progress Status of Medium-Term Management Plan 2016
October 30, 2015 03 Progress Status of “Medium-Term Management Plan 2016” Copyright © Sumitomo Heavy Industries, Ltd. All Right Reserved. 18
Slide 19: Progress Status of Medium-Term Management Plan 2016
October 30, 2015 03 Progress Status of “Medium-Term Management Plan 2016” Due to the external environment, the initial forecast for FY2015 has been revised downwards Essential to achieve final FY objectives (i.e. Sales of JPY700 billion; Operating Income of JPY52.5 billion) Sales OP Margin Copyr
Slide 20: Gap Analysis from FY2015 Initial Forecast and Targets of MTMP16
October 30, 2015 Gap Analysis from FY2015 Initial Forecast and To Achieve 03 the Targets of “MTMP16” Gap from FY2015 Initial Forecast Downside Upside Hydraulic Excavators: Downward trend in Injection molding machines China market Continued Gear Reducers: Slowdown in China market Industrial cranes st
Slide 21: Measures to counteract downwards trend (1) – Large-scale gear reducers
October 30, 2015 03 Measures to counteract downwards trend (1) – Large-scale gear reducers Enhance cost competitiveness through restructuring of supply chain in Japan and Asia Complete reorganization and independence of Eurozone and US subsidiaries Japan, Asia Europe Areas of Americas Kaizuka HI
Slide 22: Measures to counteract downwards trend (2) – Hydraulic excavators
October 30, 2015 Measures to counteract downwards trend (2) 03 – Hydraulic excavators Enhance cost competitiveness through restructuring of supply chain in Japan and Asia Enhance marketing and sales, strengthen collaboration with CNHi <Europe> <China> <North America> • Strengthen • Aim to increa
Slide 23: Measures to counteract downwards trend (3) – Boilers
October 30, 2015 03 Measures to counteract downwards trend (3) – Boilers Increase earning power through the strengthening of plant engineering capabilities Topics that have become Countermeasures apparent to date • Strengthen process management through Delay in Designing and front-loading of work
Slide 24: Growth Strategies (1) – Injection molding machines
October 30, 2015 Growth Strategies from High Performing Businesses (1) 03 – Injection molding machines Following on from compact-sized machines, carry out full model change for medium-sized machines - Down-sizing of machines made possible to equip with even larger molds - Contribute towards increa
Slide 25: Growth Strategies (2) – Industrial cranes
October 30, 2015 Growth Strategies from High Performing Businesses (2) 03 – Industrial cranes Pursue synergies via the integrated company Approx. JPY41 Effect of Sales of crane business integration billion of Mitsubishi Heavy Industries (FY2014) Approx. JPY10 billion Sales of Sumitomo Heavy Indust
Slide 26: Growth Strategies (3) – Turbines, South East Asia
October 30, 2015 03 Growth Strategies from High Performing Businesses (3) – Turbines Establish number one position in the South East Asian power generation market South East Asia Private power generation Sugar production market Retail electricity market market Strategy Expand and sustain loyal
Slide 27: Management Policies
October 30, 2015 03 Management Policies Second Half of FY2015 Continue steady management ~ Operate with a quality-first mentality During FY2015: Focus on acquiring orders to achieve the objectives of JPY690 billion in sales and JPY46 billion in operating income Implement measures to achieve th
Slide 28: October 30, 2015 All forward-looking statements regarding the company’s future performance are based on
October 30, 2015 All forward-looking statements regarding the company’s future performance are based on information currently available to Sumitomo Heavy Industries and determined subjectively. Future performance is not guaranteed and all information related to future performance contained herein is
Sumitomo Heavy Industries — Q2 FY2015 Earnings Presentation on 6ix