Fp Corporation · TSE:7947
Fp — H1 FY2020 Earnings Presentation
66 slides from Fp's earnings presentation, Nov 6, 2019
Slide 1: Financial Results for the Six Months Ended September 30, 2019
Financial Results for the Six Months Ended September 30, 2019 FP Corporation November 6, 2019 FP Corporation 1・
Slide 2: Cautions for Handling This Material
Cautions for Handling This Material We have paid extremely close attention to the information provided through presentations at this session and contained in the handouts. The forward-looking statements included in the information are our estimates based on the information available at the time of p
Slide 3: Table of Contents
= Table of Contents = Results and Plan Executive Vice President and Director, Executive General Manager of Finance and Accounting Division Isao Ikegami ... 4 To Increase Corporate Value President Morimasa Sato . . . 15 Supporting Data . . . 58 FP Corporation 3・
Slide 4: Consolidated Financial Results for the First Half of FY Ending March 2020
Consolidated Financial Results for the First half of FY Ending March 2020 Executive Vice President and Director, Executive General Manager of Finance and Accounting Division Isao Ikegami FP Corporation 4・
Slide 5: Financial Results Summary
Financial Results Summary （Results for the First half of FY Ending March 2020） First half Performance First half Projections Full year Projections FY ending March 2020 FY ending March 2020 FY ending March 2020 FY ended March 2019 Record high increase/ Year-on progress progress Unit: million y en Per
Slide 6: Results for Increase/Decrease in Ordinary Profit
Results for Increase/Decrease in Ordinary Profit (ForEnding the First half of FY March 2020) 0.0 20.0 40.0 60.0 80.0 100.0 120.0 140.0 Unit: billion yen 160.0 Fiscal Year ended March 2019 14.86 前年 1st half 6.48 2nd half 8.38 The Price of 原料 Material +0.25 Virgin PET raw materials + 0.20 （1Q-0.05、 2Q
Slide 7: Outlook for Increase/Decrease in Ordinary Profit
Outlook for Increase/Decrease in Ordinary Profit Outlook( Oct 31) 0.0 20.0 40.0 60.0 80.0 100.0 120.0 140.0 Unit: billion yen 160.0 Fiscal Year ended March 2019 14.86 2nd half 1st half 前年 outlook 1st half 6.48 2nd half 8.38 Plan difference 1st half Changes in the The Price of difference 2nd half out
Slide 8: Capital Investments and R&D Costs
Capital Investments and R&D Costs （Results for the First half of FY Ending March 2020） First half performance First half projections Full year projections FY ended March 2019 FY ending March 2020 FY ending March 2020 FY ending March 2020 Increase / Progress Progress Unit: million yen Performance Per
Slide 9: Balance Sheet
Balance Sheet (Results for the First half of FY Ending March 2020) Previous consolidated First half of the consolidated fiscal year fiscal year FY ended March 2019 FY ending March 2020 Increase/ Year-on- Breakdown of main increases As of March 31,2019 As of September 3 0,20 20 Unit: million yen decr
Slide 10: Cash Flows
Cash Flows (Results for the First half of FY Ending March 2020) Results for first half FY ended March 2019 FY ending March 2020 Unit: million yen Perform ance Performance Breakdown of Main Items Incom e before incom e taxes 7,254 Depreciation 6,702 Increase in notes and accounts receivable-trade 3,6
Slide 11: Plan for the Fiscal Year Ending March 2020
Plan for the Fiscal Year Ending March 2020 FP Corporation 11・
Slide 12: Outline of Plan for Account Settlement
Outline of Plan for Account Settlement (Plan for the FY Ending March 2020 ) Results for Full year Full year project ions First half projections FY ended March 2019 FY ending March 2020 FY ending March 2020 increase/ Year-on increase/ Year-on Unit: million yen Performance perc en tage Planned perc e
Slide 13: Outlook for Increase/Decrease in Ordinary Profit
Outlook for Increase/Decrease in Ordinary Profit (Plan for the FY Ending March 2020) Outlook( May 8 2019) 0 20.0 40.0 60.0 80.0 100.0 120.0 140.0 160.0 Fiscal Year ended March 2019 14.86 Unit: billion yen 1st half 6.48 2nd half 8.38 1st half 2nd half The Price of Material +0.45 （1 half +0.25、2nd hal
Slide 14: Planned Capital Investment and R&D Costs
Planned Capital Investment and R&D Costs (Plan for the FY Ending March 2020) Results for Full year Full year projections First half projections FY ended March 2019 FY ending March 2020 FY ending March 2020 Increase / Increase / Progress Unit: million y en Performance Planned decrease Year-on-year Pl
Slide 15: To Increase Corporate Value
To Increase Corporate Value President Morimasa Sato
Slide 16: Market Conditions
Market Conditions i TI7eI
Slide 17: Circumstances Surrounding the Retail Industry
Circumstances Surrounding the Retail Industry (FP Corporation’s actions) Expansion of home meal replacement market (Propose production of attractive selling spaces) Aggravation of labor shortage (Propose backyard efficiency improvement) Trend Soaring logistics expenses (Increase usage ratio of own t
Slide 18: Trend in Raw Material Prices
Trend in Prices February 2017 April 2018 January 2019 203 January 2018 204 197 Domestic price of July 2017 195 July 2019 general polystyrene 185 April 2019 179 April 2016 May 2018 172 163 160 Raw April 2018 January 2019 Domestic price of 140 140 Material August 2019 general PET January 2017 124 121
Slide 19: Changes in the Number of Households
Changes in the Number of Households One-person households Couple-only households Households of single parents with children Households of couples with children Ratio of households with Other general households 20,000 one person and couples 0 10,000 30,000 40,000 50,000 aged 65 or older Couple-only 2
Slide 20: Trend in Scale of Home Meal Replacement Market
Trend in Scale of Home Meal Replacement Market FY2018 10.3 10 9.8 10.1 9.6 9.3 Trillion yen 8.7 8.9 8 8.2 8.1 8.4 7.8 7.9 8.1 7.6 7.2 6 Cooking at home: Home meal Approx. 35.3 trillion yen replacement Approx. 4 10.3 trillion yen Major food manufacturers Eating out: Markets expected to grow in the fu
Slide 21: Expanding Market
Expanding Market Net sales of the FPCO Group Convenience Food manufacturers Food service/Nursing-care Mostly supermarkets stores (for home meal replacement) facilities Prepared food stores Restaurants (home delivery/takeout meals) Frozen food manufacturers Trays with lids Containers for food service
Slide 22: Nationwide Spread of Namakara Sozai
Nationwide Spread of Namakara Sozai Selling situation Number of companies Container Increasing by approx. offering Namakara Sozai shipments 2 times every year September 2015 September 2018 September 2019 Extracted data on 25 sizes of the 95 companies 114 companies To157 companies three main series o
Slide 23: Consumption Tax Increase and Two-Tier Tax Rates
Consumption Tax Increase and Two-Tier Tax Rates Reduced 8% tax rate Regular 10% tax rate applicable to applicable to Food, takeout meals and Food consumed at home delivery restaurants and eating areas Accelerated entries 23
Slide 24: New Market: Home Delivery and Hospital/Nursing Care Food
New Market: Home Delivery and Hospital/Nursing Care Food Home Hospital/ Nursing delivery care Number of people to which Minna-no Nichiyobi (Sunday for Everyone) food services from Nissin Healthcare Food Service were provided As of Jul. 31 Approx. Approx. 14% Special containers 60,000 /Approx.420,000
Slide 25: New Market: Making a Foray into Frozen Food
New Market: Making a Foray into Frozen Food by Taking Advantage of Unique Materials MFP, a consumer-friendly material OPET, which is resistant to frozen distribution Can be used for storing the food in a freezer and heating it in the microwave thanks to the cold and heat resistance to temperatures b
Slide 26: Sales Shares of Original Products
Sales Shares of Original Products Conventional materials Conventional materials 2020/3 First half New products made of 77％ conventional materials* Eco PSP Eco APET Original 60％ products ＯＰＥＴ ＭＦＰ ＭＳＤ New Transparent PP * Until Dec. 2015: new products in and after Jan. 2013 Since Jan. 2016: new produc
Slide 27: Actions for Recycling
Actions for Recycling i TI7eI
Slide 28: Ocean Plastic Pollution: Trends in the World and Japan
Ocean Plastic Pollution: Trends in the World and Japan Global trends Trends in Japan Notification of waste import restrictions 2017 China to WTO 2018 G7 Ocean Plastics Charter Comprehensive strategy for plastic 2019 MOE material recycling (Excerpt of milestones) - Reusing and recycling 60% of contai
Slide 29: Preventing Inputs of Plastics from Land into the Ocean
Necessary Measure: Preventing Inputs of Plastics from Land into the Ocean Ranking of countries in the inputs of plastic waste from land into the ocean (2010 estimate) 1st: China 1.32- 3.53 mn tons/year 2nd: Indonesia 0.48- 1.29 mn tons/year 3rd: Philippines 0.28- 0.75 mn tons/year 4th: Vietnam 0.28-
Slide 30: Recycling of Plastics from Household Waste
Recycling of Plastics from Household Waste (Non-Industrial Waste) Single PET bottles material Material recycling Approx. [Recycling of materials] 0.75 mn tons Food containers Approx. 0.8 mn tons Thermal recycling [Thermal recovery] Soft packaging Approx. 3.0 mn tons Composite material 30
Slide 31: FPCO Method of Recycling
FPCO Method of Recycling Packaging material Consumers Supermarkets wholesalers History Initially Collection Replacement of 1980 1990 Garbage problem in Hiroshima containers with paper packages Boycott against McDonald’s in the U.S. 6 stores bases 1990 Launch of recycling with FPCO method Approx. 199
Slide 32: Promoting 3Rs (Reduce, Reuse, and Recycle)
Promoting 3Rs (Reduce, Reuse, and Recycle) Number of stores at which the poster is displayed 8000 7000 6000 5000 Poster displayed at 4000 3000 approx. 7,247 stores (by 199 companies as of end of September 2019) 2000 1000 0 Company Name Jan. Feb. Mar. Apr. May Jun. Jul. Not single-use but a resource
Slide 33: Collection of Plastic Resources
Collection of Plastic Resources * The corresponding values for the number of containers and bottles were calculated based on the following standard weights. Amount (number) of recycled containers/bottles Foam tray: approx. 4 grams; transparent container: approx. 10 grams; PET bottle: approx. 25 gram
Slide 34: Eco Tray / Eco APET CO2 Reduction
Eco Tray / Eco APET CO2 Reduction Eco Tray CO2 emissions Eco APET In FY ended March 2019, CO2 emissions were cut by 135,000 tons a year (Eco Tray: 33,000 tons / Eco APET 78,000 tons / Eco OPET 23,000 tons) 34 Comparison of life cycle assessment (LCA) results between FPCO products
Slide 35: Active Adoption of Eco Products
Active Adoption of Eco Products A reason why ESG selects FPCO suppliers Introducing recycling measures at our website and in in-house magazine General Meeting of Manufacturer A Shareholders In-house Website magazine Manufacturer B Trend in sales of eco products Eco product sales for FY ended March 2
Slide 36: Investment in Recycling and Ratio of Eco Products
Investment in Recycling and Ratio of Eco Products Eco PSP Eco APET Eco OPET Sales shares of eco products Eco OPET developed Eco Trays only Eco APET released 44% 37% 31% 32% 26% 28% 28% 15% 16% 16% 16% 16% 3/2009 3/2010 3/2011 3/2012 3/2013 3/2014 3/2015 3/2016 3/2017 3/2018 3/2019 9/2019 3/2021 fore
Slide 37: Weight and Stacking Height Reduction
Weight and Stacking Height Reduction Weight Reduction Kyonishiki 20-16R Material: HI Tosai 19-17 Material: Low-foamed PSP Reducing the weight and thickness Weight per tray reduced to by 5% compared to the FY2013 nearly one third level by 2020 22.9 g per tray 7.8 g per tray Stacking Height Reduction
Slide 38: External Evaluation
External Evaluation Selected for the first time as a constituent of the FTSE4Good Index Series and FTSE Blossom Japan Index, which are ESG indexes (June 2019) Indexes developed by FT Russel of the London Stock Exchange Group, which reflect the performance of companies taking excellent Environmental,
Slide 39: External Evaluation
External Evaluation FPCO wins the Japan Times Satoyama & ESG Awards 2019 A program that commends companies and organizations which have made remarkable achievements in promoting and spreading effective use of satoyama (woodlands near villages) and satoumi (coastal areas where biological productivity
Slide 40: External Evaluation: TV Programs in 2019 that Introduced FPCO
External Evaluation: TV Programs in 2019 that Introduced FPCO Content Month Program Containers’ Namakara Recycling functions Sozai Mar. Fuji TV Mezamashi TV 〇 NHK Asaichi 〇 TBS N-Sta 〇 Jun. Kansai TV Uramayo 〇 〇 Chukyo TV Catch! 〇 FBS (Fukuoka Broadcasting Systems) Barihaya! ZIP 〇 Jul. Yamagata Broa
Slide 41: Streamlining of Logistics and Manufacturing
Streamlining of Logistics and Manufacturing
Slide 42: Towards Automated and Unmanned Warehouse Operations
Towards Automated and Unmanned Warehouse Operations Human labor Automated Being studied Receipt Shipping Truck Feed Truck Forklift Vertilator Forklift AGV Forklift Storing Picking Forklift AGV Forklift into Sorter sorter Transfer by lift Transfer by lift Feeding method (being studied) (being studied
Slide 43: Voice Picking and Pallet Transportation
Steady Improvements Voice Picking Items/Hour Productivity enabled by voice picking Sep. 2019 803 items per hour Immediately after introduction of the system: 300 items per 1) Listen to instructions hour 2) Select with both hands Nov. May Jul. Sep. Nov. May Jul. Sep. Nov. May Jul. Sep. Nov. May Jul.
Slide 44: Actions for Suppressing Soaring Logistics Expenses
Actions for Suppressing Soaring Logistics Expenses (Distribution of Sales) Increase load efficiency per truck Increase ratio of private services September 2018 September 2019 FY2019 1H Up 6.8% from FY2015 level 96.3% 96.9% +0.6% (≈ 10,000 cases) (Sai* per truck) * 1 sai = 0.027826474 m3 96.9% 3.1% 1
Slide 45: Strong Crisis Management Structure Supporting Stable Supply
Strong Crisis Management Structure Supporting Stable Supply Most recent natural disasters Business Continuity Plan (BCP) for uninterrupted logistics operations Hokkaido Eastern Iburi Earthquake in September 2018 in the event of a disaster Heavy snow in Hokuriku Power supply was secured Emergency pow
Slide 46: Streamlining Effect in Manufacturing Division and Quality Improvements
Streamlining Effect in Manufacturing Division and Quality Improvements Trend in number of shots per hour (expressed in index form) Accumulation of various 113 improvements Shortening of preparation time Improvements in facility 13% performance Up Improvements in molds and cutting dies 100 Im
Slide 47: Higher Work Efficiency Enabled by Automation
Higher Work Efficiency Enabled by Automation (Manufacturing Division) Labor saving of approx. 161 workers Labor saving of 3/2020 Labor saving of approx. 112 workers Plan approx. 94 workers 3/2019 3/2018 Automatic dusting and 8 units (all for PET) packaging machines forecasted at the end of FY3/2020
Slide 48: Use of AI for SCM System
Use of AI for SCM System Customers Using AI to improve the precision Retailers and wholesalers and efficiency of sales forecasts From Oct. 2019 onwards: Salespeople Trial operation for approx. 3,500 items From Jan. 2020 onwards: Full-scale operation (plan) for approx. 5,300 items Sales forecast Info
Slide 49: Disability Employment and Development of Working Environment
Disability Employment and Development of Working Environment
Slide 50: Diversity Management That Maximizes Abilities
Diversity Management That Maximizes Abilities Certification Sorting centers: 10 locations for Employment of People with Disabilities ■Jan.2019（Ministry of Health, Labor and Welfare ） 7 in-house locations FY2018 People with Disabilities Active 1 location with a contractor Company Certification 2 loca
Slide 51: Construction of Pico House Bachelors' Dormitories
Development of Working Environment: Construction of Pico House Bachelors’ Dormitories Investment in company housing and Pico House No. 1 group homes for people with disabilities Jan. 2017 Pico House No. 1 (150 units) Pico House Mar. 2017 Pico House No. 2 (102 units) 2No. 号館 Location: Chikusei, Ibara
Slide 52: Growth Strategy
Growth Strategy
Slide 53: Start of Operation for the New Business Model
Start of Operation for the New Business Model Product purchase Group’s wholesalers MD Strength in locally Selecting items, consolidating based sales inventory, enhancing lineup of private brand (PB) products FPCO International FPCO Trading FPCO Group’s Package FPCO Ueda FPCO Ishida infrastructure 26
Slide 54: Start of Operation for the New Business Model: E-commerce Site
Start of Operation for the New Business Model Expanding Steadily Since FPCO Group’s infrastructure the Launch in June Performance of the Pack Market E-commerce site Launch June July August September Collaborating with Group wholesalers and influential wholesalers of each region, MD aiming for furthe
Slide 55: Capital Investment and Cash Flows
Capital Investment and Cash Flows Cash flows from operating activities Billion yen 60 0.15 12.5% 12.8% 12.0% 12.0% 11.5% Capital investment: 50 10.1% 10.6% 8.9% 0.1 Goal of 18 to 20 billion yen ROE 7.8% 9.1% Enhance the system for supplying high value-added products 7.7% from the perspective of medi
Slide 56: Growth Strategies of FPCO
Growth Strategies of FPCO Considering overseas expansion Considering M&A Long-term plan Net sales: ¥300 bn Growth strategy 2 Ordinary profit: ¥30 bn (Net sales) Billion yen Home delivery market Frozen food market (Ordinary profit) 300 Markets of materials and 30 consumables 250 Growth Strategy 1 25
Slide 57: To Increase Corporate Value
To Increase Corporate Value “We ensure that we reliably deliver the most environmentally friendly products of the highest quality at the most competitive prices whenever they are needed.” Hardware Software Balance People We adhere to the FPCO-DNA and continue to make proposals with the foresight of
Slide 58: Supporting Data
Supporting Data FP Corporation 58・
Slide 59: Explanation of terms
Explanation of terms PS ： Polystyrene PET ： Polyethylene terephthalate PP ： Polypropylene Multi FP (MFP) ： An formed PS (polystyrene) container with cold and heat resistance to temperatures between -40ºC and +110ºC and with superior oil and acid resistance and thermal insulation. Multi Solid (MSD) ：
Slide 60: World's First Sheets and Materials
World’s First Sheets and Materials Evolution from a sheet processing manufacturer PP: polypropylene PS: polystyrene PSP: foamed polystyrene Easy to mold Heat-resistant: +110ºC Low raw material ratio High oil resistance Weight reduction is possible Foam is hard and resistant to High ins
Slide 61: Trends in original products development
Trends in original products development ’11/3 ’12/3 ’13/3 ’14/3 ’15/3 ’16/3 ’17/3 ’18/3 ’19/3 Feb. 2010: Market release of the Multi FP (MFP) Feb. 2012: Market release of the Multi Solid (MSD) May 2012: Market release of the Eco APET Nov. 2010 Jun. 2014 March 2016 Chubu PET Recycling Plant Nishiniho
Slide 62: Factors influencing Ordinary Profit
Factors influencing Ordinary Profit Unit:100 million yen '14/3 '15/3 '16/3 '17/3 '18/3 '19/3 20/3 Plan '03/3 '04/3 '05/3 '06/3 '07/3 '08/3 '09/3 '10/3 '11/3 '12/3 '13/3 1st 2nd Full 1st 2nd Full 1st 2nd Full 1st 2nd Full 1st 2nd Full 1st 2nd Full 1st 2nd Full half half year half half year half half
Slide 63: Trends in Capital Investment and R&D Costs
Trends in Capital Investment and R&D Costs * Since 2009/03, capital investment have been included procurement through lease. FP Corporation 63・
Slide 64: Strategy for Plastic Material Recycling by the Ministry of the Environment
Strategy for Plastic Material Recycling by the Ministry of the Environment (Rough Plan) Strategy for Plastic Material Recycling Ocean Plastics Charter endorsed at by the Ministry of the Environment Charlevoix G7 Summit in Canada (Rough Plan): Milestone We aim to reduce emissions of single-use plasti
Slide 65: Collaboration with Related Ministries, Agencies and Organizations
Collaboration with Related Ministries, Agencies and Organizations Actions of related ministries, agencies and organizations FPCO’s involvement ● Plastic resources recycling strategy Participation in a subcommittee as an industrial Presentation on Japan’s plastic resource recycling strategy planned
Slide 66: Information on the Facility Tour
Contact: Takashima at the Corporate Planning Department 【 Information on the Facility Tour 】 (TEL)+81-3-5325-7756 (MAIL)ir_7947@fpco-net.co.jp at a convenient time for you. An opportunity to take a look at the state-of-the-art Production, Distribution, Recycling operations Kanto 30 minutes from Koga