Innotech Corporation · TSE:9880
Innotech — 1H FY2017 Earnings Presentation
33 slides from Innotech's earnings presentation, Nov 9, 2017
Slide 1: FY2017 1st Half Financial Results
FY2017 1st Half Financial Results November 9, 2017 1
Slide 2: Agenda
Agenda 1 FY2017 1H Actual 2 FY2017 Outlook 3 Mid-Term Management Plan 2
Slide 3: FY2017 1H Highlights
FY2017 1H Highlights Consolidated Operating Profit decreased by 51% compared to the previous year; 45% of annual plan is achieved so far. EDA customers move-out adversely affecting the full year finacial results; Tester business reduced significantly, causing INNOTECH parent in deficit. Regulus and
Slide 4: FY2017 1H Actual
FY2017 1H Actual [mil. yen] Sanei IT GAIO STAr INNOTECH Regulus Consolidated Hytechs Access TECHNOLOGY Technologies YoY FY2017 FY2016 FY2017 FY2016 FY2017 FY2016 FY2017 FY2016 FY2017 FY2016 FY2017 FY2016 FY2017 FY2016 Fiscal Year 1H 1H 1H 1H 1H 1H 1H 1H 1H 1H 1H 1H 1H 1H Net Sales 8,135 9,624 1,617
Slide 5: FY2017 1H Design and Development Solution Business
FY2017 1H Design and Development Solution Business 〔Sales: mil. yen〕 〔Gross Profit: mil. yen〕 10,000 2,349 2,225 2,000 1,626 1,612 189 128 913 986 三栄ハイテックス Sanei Hytechs レグラス Regulus 5,000 1,059 1,231 アイティアクセス IT Access 組込システム Embedded System 1,298 1,000 ガイオテクノロジー 1,416 GAIO TECHNOLOGY EDA EDA 売上総利益
Slide 6: Design and Development Solution Business
Design and Development Solution Business EDA Substantial decrease of revenue compared to the first half of FY2016 but business with existing customers are increasing steadily. GAIO Test-Tools business and Engineering-Services business remained strong; revenue and profit increased. Embedded System Re
Slide 7: FY2017 1H Product Solution Business
FY2017 1H Product Solution Business 〔Sales: mil. yen〕 〔Gross Profit: mil. yen〕 10,000 2,002 2,000 344 1,623 IoT and 395 Others IoT他 5,000 2,241 HDD HDD 2,257 STAr Technologies STAｒ Technologies 1,000 テスター Tester 売上総利益 Gross Profit 1,364 2,179 2,514 1,198 0 0 FY2016 16年9月期1H FY2017 1H 17年9月期 Total 6,
Slide 8: Product Solution Business
Product Solution Business Testers Substantially decreased compared to the first half of FY2016 but recovered compared to the second half of FY2016. STAr Probe card sales to major customers remains strong; substantial increase in revenue. HDD Business transfer got delayed until November; results were
Slide 9: Consolidated Selling and Administration Expense
Consolidated Selling and Administration Expense 〔mil. yen〕 FY2016 1H FY2017 1H Total Selling and Administration Expense 3,531 3,445 (INNOTECH) 1,934 1,715 (JSC) - 18 Major Items Personnel Expenses 1,995 1,892 Depreciation 97 77 Amortization of Goodwill 107 109 Research & Development 413 434 （※） Roun
Slide 10: Cash Flow
Cash Flow [mil. yen] FY2016 1H FY2017 1H Income Before Income Taxes 887 448 Depreciation and Amortization of Goodwill 367 393 Working Capital and Others 1,019 -295 Cash Flows from Operating Activities 2,274 546 Purchase of Investment Securities -102 -847 Payments of Deposits Paid for Purchase of Sha
Slide 11: Investment in seven dreamers laboratories
Investment in seven dreamers laboratories Development assistance for seven dreamers’ product “laundroid” using MBD Aim at other development assistance of other innovative products and services of seven dreamers (Announced on July 4) INNOTECH seven dreamers laboratories MBD 11 laundroid, etc...
Slide 12: Capital and Business Partnership (CVP Holdings Limited)
Capital and Business Partnership (CVP Holdings Limited) Executed a capital and business partnership agreement with CVP Holdings Limited in Hong Kong to accelerate deployment of our tester business in the Chinese market . (Announced on August 29) Partner CVP Holdings Limited Business Partnership Sa
Slide 13: Withdrawal from the Electronic Component Business
Withdrawal from the Electronic Component Business HDD Business Sold off to SATORI ELECTRIC CO. LTD Business Transfer Agreement Executed on September 7, 2017 Business Transfer Date November 1, 2017 Intel Distributorship Ceased CPU-distribution business as of the end of September (Hardly any impac
Slide 14: Agenda
Agenda 1 FY2017 1H Actual 2 FY2017 Outlook 3 Mid-Term Management Plan 14
Slide 15: FY2017 Forecast Does Not Change
FY 2017 Highlights (Forecast) FY2017 Forecast Does Not Change A deficit in the operating profit of INNOTECH parent company is predicted due to the HDD business transfer and EDA Customer move-out. Tester expects an increase in shipments from second half GAIO TECHNOLOGY and STAr Technologies forecasts
Slide 16: FY2017 Estimate
FY2017 Estimate [mil. yen] GAIO Sanei IT STAｒ Consoli- INNOTECH TECHNOL Regulus FY2015 YoY Hytechs ACCESS Technologies dated OGY Net Sales 15,000 3,400 2,200 2,700 4,000 500 27,500 28,863 -5% Gross 3,300 785 500 1,310 1,680 215 7,850 8,076 Profit -3% (22.0%) (23.1%) (22.7%) (48.5%) (42.0%) (43.0%) (
Slide 17: FY2017 Design and Development Solution Business
FY2017 Design and Development Solution Business 〔Sales: mil. yen〕 〔Gross Profit: mil. yen〕 20,000 4,847 4,730 5,000 3,270 4,000 15,000 3,400 440 500 2,106 2,200 3,000 Sanei Hytechs 三栄ハイテックス レグラス Regulus 10,000 2,235 2,000 アイティアクセス IT Access 組込システム Embedded System 2,622 2,000 ガイオテクノロジー 2,700 GAIO EDA
Slide 18: FY2017 Product Solution Business
FY2017 Product Solution Business 〔Sales: mil. yen〕 〔Gross Profit: mil. yen〕 15,000 3,229 3,120 3,000 620 10,000 700 4,476 2,800 2,000 IoT and IoT他 Others HDD HDD STAr Technologies STAｒ Technologies Tester テスター 5,000 3,515 4,000 売上総利益 Gross Profit 1,000 3,122 3,200 0 0 FY2016 17年3月期 FY2017 18年3月期 Tot
Slide 19: EBITDA Trends
EBITDA Trends [mil. yen] 2,500 EBITDA 2H EBITDA下期 EBITDA 1H EBITDA上期 1,978 1,994 2,000 Operating Profit of the year 営業利益通期 1,787 1,576 589 1,446 739 1,500 1,267 642 640 945 1,000 404 1,095 1,012 999 900 761 722 500 1,388 1,255 842 863 804 936 0 FY2012 13年3月期 FY2013 15年3月期 14年3月期 FY2015 17年3月期 FY2014
Slide 20: Dividends
Dividends Dividend As of 1H- As of FY- Full Year Payout end end Ratio FY2016 7 yen 8 yen 15 yen 32.7% FY2017 (Outlook) 10 yen 10 yen 20 yen 54.1% On November 8th, we announced an increase in the interim dividend from 7 yens to 10 yens for FY2017 first half and 8 yens to 10 yens for FY2017 second hal
Slide 21: Agenda
Agenda 1 2017 1H Actual 2 FY2017 Outlook 3 Mid-Term Management Plan 21
Slide 22: Overview: Mid-Term Management Plan
Overview: Mid-Term Management Plan (Announced in November 2014) （Background） Changes in industry environment, realization of M & A, implementation of business structure reform （Strategy） Focus on 4 growth areas (Test, MBD, Image Processing, Embedded Solutions ) Active overseas expansion and inve
Slide 23: Mid-Term Management Plan: Current Status and Measures for the Remaining 2 Years
Mid-Term Management Plan: Current Status and Measures for the Remaining 2 Years Current Status No changes to the business strategies, but as for the numerical goals, some of our assumptions at the time of planning have been changed. It is expected that our business of the fiscal year of 2017 will be
Slide 24: Expanding Tester Business
Expanding Tester Business Testers for CIS Initial Development of Full Shipment to be Shipment New Models Expected Starting to SSD Inspection Development ship Solutions for Develop Starting to ship Package Test ment Testers for 3D- NAND Flash Starting Full Shipment to be Memory to ship Expected 2016
Slide 25: Outstanding orders for testers hit the bottom; business remains stable
Outstanding orders for testers hit the bottom; business remains stable Trend of outstanding orders for testers as of the end of the month on INNOTECH parent (Mar. 2016-Sept. 2017) More-than 5-folds increase in year-on-year comparison basis 2016/3 9 2017/3 9 25
Slide 26: Test Solutions: Strategy for China is to Partner with CVP
Test Solutions: Strategy for China is to Partner with CVP Semiconductor Market in China Establish a manufacturing, sales and support system Japan Actual record of investment and Products/technology business know-how (Testers, other products) in China CVP Hong Taiwan Kong 26
Slide 27: IoT (Embedded) System: Area of Deployment
IoT (Embedded) System: Area of Deployment Frequency of communication with the server and the data amount Edge Computing High Cloud Computing Traffic Control Human Recognition INNOTECH IoT Storage Irregularity (Embedded) Video/Voice Web Recognition Detection System: Area of Service SNS Smart Deployme
Slide 28: Efforts on Image Processing Solution
Efforts on Image Processing Solution Regulus-made camera system “McKinley” is adopted by Nileworks, Inc. as its agricultural drone Regulus-made Monitor the growing-up state of agricultural products “Multi-wavelength by the multi-wavelength camera to support McKinley” Pesticide application Strengthen
Slide 29: Transformation of INNOTECH Business Portfolio
Transformation of INNOTECH Business Portfolio Software Service INNOETCH has grown as a semiconductor trading house since its foundation in 1987 throughout the 90’s. EDA Trading company (Other companies ASIC Maker Products) (own products) Semiconductor Manufacturing And Test Equipment HDD Electronic
Slide 30: Transformation of INNOTECH Business Portfolio
Transformation of INNOTECH Business Portfolio Since 2000: Software Service Development of INNOTECH products, acceleration of M&A, LSI Design (Sanei) and withdrawal from the component business MBD this year EDA Verification Tools (GAIO) Embedded Software(ITA) Image Processing (Regulus) Trading compan
Slide 31: Mid-Term Management Plan: Three Innovations
Mid- Management Plan: Three Innovations Product 1st Innovation Solution From Product Business to Technical Customer Solution Business INNOTECH Support 2nd Innovation From Domestic Business to Global Business INNOTECH 3rd Innovation Final Device Product From Semiconductor Market Makers Makers to Fina
Slide 32: Future Challenges
Future Challenges Early launch of new business Acceleration of group management (synergy effects in the group); reorganization if necessary Capital management policy Consideration of a new mid-term vision and 32 a mid-term management plan
Slide 33: Note for Forward Looking Statements
Note for Forward Looking Statements The information provided in this presentation includes forward looking statements based on current expectations, forecasts or beliefs. Such forward looking statements include a number of preliminary assumptions about future events that are subject to factors and u