Hanwa Co., Ltd. · TSE:8078
Hanwa — FY2014 Earnings Presentation
27 slides from Hanwa's earnings presentation, May 20, 2015
Slide 1: Financial Results for the Fiscal Year ended March 31, 2015
FINANCIAL RESULTS for the Fiscal Year ended March 31, 2015 May 20, 2015 HANWA CO., LTD. Copyright 2015 Hanwa Co., Ltd. All Rights Reserved 1
Slide 2: Overviews of Financial Results
Overviews of Financial Results • As for the result for this fiscal year, net sales has reached to 1,737.3 billion yen, increased by 3.3%, due to increase in steel and metals/alloys businesses. • On profit side, operating income have increased by 17.6%, thanks to increase profit in metals/alloys and
Slide 3: Operating Results (consolidated)
Operating Results ( consolidated ) （Millions of yen） Rate of ・Net sales has increased by 3.3% FY2014 FY2013 changes from the previous year, due to Net sales 1,737,397 1,682,503 +3.3% revenue growth in steel and metals/alloys businesses. Gross profit 55,729 51,365 +8.5% SG&A expenses 36,622 35,112 +4
Slide 4: Changes in Business results (consolidated)
Changes in Business results （ consolidated ） Net sales （100 millions of yen） The U.S. economy was healthy but the 20,000 Year ended Interim period 17,373 18,000 European economy was sluggish and 16,825 15,113 economic growth slowed in China due to 15,000 its stable growth policy. In emerging （foreca
Slide 5: Financial Position (consolidated)
Financial Position ( consolidated ) （Millions of yen） Rate of ・Total assets increased by 9.8% FY2014 FY2013 from the end of the previous change year, due to the increase of Total assets 651,456 593,351 +9.8% inventories and trade receivables with the increased net sales. Current assets 510,377 468,3
Slide 6: Cash Flows Situation (consolidated)
Cash Flows Situation ( consolidated ) Net cash provided by （Millions of yen） operation was 1.7 billion yen, due to slowdown of FY2014 FY2013 change capital requirement and income from advances received. Cash flows from 1,790 343 +1,447 Operating activities Net cash used in investment was 13.6 Cash f
Slide 7: Segment Information (consolidated)
Segment Information ( consolidated ) Net sales Segment income （Millions of yen） Rate of Rate of FY2014 FY2013 FY2014 FY2013 change change Steel 878,715 811,096 +8.3% Steel 14,735 13,879 +6.2% Metal & alloys 131,171 97,995 +33.9% Metal & alloys 343 1,756 -80.5% Non-ferrous Non-ferrous metals 83,365 7
Slide 8: Steel Business Segment
Steel Business Segment （Millions of yen） Net sales Segment income Profit ratio FY2014 878,715 14,735 1.7% FY2013 811,096 13,879 1.7% Despite the large number of building and civil engineering projects, construction demand for steel was soft mainly because of Japan’s persistent shortage of constructi
Slide 9: Transaction volume in Steel Segment (unconsolidated)
Transaction volume in Steel Segment (unconsolidated) Long product sales volume was held down by weak sales in the domestic construction sector. Flat product sales volume continued climbing because of solid demand in Japan and a recovery in overseas demand. Growth in scrap sales volume and offshore i
Slide 10: Market Trend of Long Products
Market Trend of Long Products Steel demand for construction has reached a ceiling mainly because of delays in projects caused by the labor shortage. Slow movement of steel products and price decline of raw materials caused weak steel price, but the decision of steelmakers to hold prices steady preve
Slide 11: Market Trend of Flat Products
Market Trend of Flat Products Factory utilization rates were generally good, but the market price was soft as there was no positive effect on distribution market demand. For contractual sales, demand leveled off and inventories increased because of a drop in spending after the consumption tax increa
Slide 12: Market Trend of Steel Raw Materials
Market Trend of Steel Raw Materials Under the declining demand in China, the price of imported iron ore gained momentum as mining companies that raised production capacity continued to offer low prices. Inventories at ports finally fell below 100 million tons but remain high. 【Iron Ore Market in Chi
Slide 13: Coking coal price and contract prices
【Coking coal price】 Despite low demand, coking coal 150 price was flat in 2014 but has been Coking coal (US$：/FOB Australia) falling quickly since the start of 2015. 100 Contract prices with mining companies declined quarter by quarter because of the downturn in 50 the spot price. 【Contract price be
Slide 14: Markets Trend of Steel Scrap
Markets Trend of Steel Scrap The market price of steel scrap was weak because of further price decline of major raw materials. Markets were relatively strong in Japan and the U.S. On the other hand, prices declined in in Turkey, Southeast Asia and other regions because of growing imports of cheap bi
Slide 15: Steel Market Trend in China
Steel Market Trend in China Prices declined steadily because of lackluster demand. However, exports continued to grow despite weak demand as crude steel production remained high due to the lack of progress with reducing steel output. 【Transition of steel market in China 】 80,000 5,000 Production of
Slide 16: Metals & Alloys Business Segment
Metals & Alloys Business Segment （Millions of yen） Net sales Segment income Profit ratio FY2014 131,171 343 0.3% FY2013 97,995 1,756 1.8% Selling prices increased as global market prices rose during the fiscal year’s first half and the yen weakening rapidly late in the first half. Earnings were down
Slide 17: Market Trend of Metals & Alloys
Market Trend of Metals & Alloys Indonesia’s embargo on nickel ore sparked a surge in the price of nickel that raised the price of stainless steel scrap, too. Subsequently, prices began to soften, including for ferroalloy, because of growing inventories, changes in the financial environment and the l
Slide 18: Non-ferrous Metals Business Segment
Non-ferrous Metals Business Segment （Millions of yen） Net sales Segment income Profit ratio FY2014 83,365 1,146 1.4% FY2013 77,511 835 1.1% LME prices were relatively high despite the effects of changes in the financial environment and the drop in the price of crude oil. The weaker yen also pushed u
Slide 19: Markets Trend of Non-ferrous Metals
Markets Trend of Non-ferrous Metals Although LME prices were generally higher in the first half, the subsequent sharp drop in the price of crude oil brought LME prices down. Prices have currently stopped falling due to relatively firm actual demand. 2,400 7,500 7,000 2,200 6,500 Al,An,Pb(US$/t) 2,00
Slide 20: Foods Business Segment
Foods Business Segment （Millions of yen） Net sales Segment income Profit ratio FY2014 87,645 583 0.7% FY2013 78,668 1,589 2.0% Demand in Japan was low but sales increased as prices were mostly higher than in the previous fiscal year. Earnings were down as falling prices of shrimp, salmon and other p
Slide 21: Market Trend of Frozen Marine Products
Market Trend of Frozen Marine Products The price of farmed salmon was in a downward trend because of falling demand. The price in yen rebounded briefly as the yen weakened while the dollar-denominated price in US dollar remained high, but high prices reduced demand and the price once again started f
Slide 22: Petroleum & Chemicals Business Segment
Petroleum & Chemicals Business Segment （Millions of yen） Net sales Segment income Profit ratio FY2014 429,919 2,481 0.6% FY2013 499,043 1,925 0.4% Sluggish demand for industrial fuel and falling prices of refined products caused by the lower cost of crude oil brought down sales. Although earning a p
Slide 23: Market Trend of Crude Oil & Petroleum Products
Market Trend of Crude Oil & Petroleum Products Initially, turmoil in the Middle East and Ukraine and other events kept the price of crude oil high. Then the price plunged as the global economy stopped growing and oil- producing countries raised output at a time that concerns about the supply of crud
Slide 24: Other Segment
Other Segment （Millions of yen） Net sales Segment income Profit ratio FY2014 242,390 683 0.3% FY2013 200,925 (262) (0.1%) Sales were higher because of an increase in bunker fuel sales volume at Hanwa Singapore. The completion of installations of leisure facilities in the machinery category contribut
Slide 25: Progress of Business Strategy
Progress of Business Strategy 【Strengthening of Domestic Business】 M&A for strengthening of function Acquisition ownership of Matsuoka Kozai Co., Ltd.(Jul-2014) Acquisition ownership of Maruhon Honma Suisan Co., Ltd.(Jul-2014) Acquisition minority shares of Nikko Metals Co., Ltd. (Aug-2014) Acquisit
Slide 26: Business Forecast FY2015 (year ending March 31, 2016)
Business Forecast FY2015 ( year ending March 31, 2016) In the past fiscal year, our performance was influenced by low commodity prices as the price of crude oil plunged, foreign exchange losses caused by the weaker yen and other events. In FY2015, we forecast higher earnings due to the exclusion of
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