Sakata Seed Corporation · TSE:1377

Sakata Seed — FY2021 Earnings Presentation

38 slides from Sakata Seed's earnings presentation, Jul 21, 2021

  1. Slide 1: Financial Highlights Material for the Period Ended May 2021

    Translation Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes. In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail. Financial Highlights Material for the Perio

  2. Slide 2: Table of Contents

    Table of Contents Ⅰ Overview of Period Ended May 2021 ... 3～16 Ⅱ Forecast for Period Ending May 2022 and ... 17～26 Dividend Policy Ⅲ Action for Global Growth ... 27～30 Ⅳ Topics ... 31～33 V Appendix … 34～37 Copyright©SAKATA SEED CORPORATION All Rights Reserved. 2

  3. Slide 3: Overview of Period Ended May 2021

    Ⅰ Overview of Period Ended May 2021 Figures in the document are rounded for fractions less than the unit. Please be advised that some figures may differ from the summary of financial results. Copyright©SAKATA SEED CORPORATION All Rights Reserved. 3

  4. Slide 4: Impact of COVID-19 on period ended May 2021

    Impact of COVID-19 on period ended May 2021 ● The impact on flowers, vegetables, materials, and all other products was not significant. ● With regard to logistics, there were restrictions on the transporting of seeds, but this was addressed by bringing the schedule forward. ● From a medium- to long-

  5. Slide 5: Performance overview 2021 (Consolidated)

    Performance overview for period ended May 2021 (Consolidated) Increase in sales and profit compared to the previous year Forcast for Unit:100 million yen 2020 2021 Difference Difference(%) 2021*1 Sales 617 692 76 12.2% 670(+22) Gross profit 344 386 42 12.2% - Gross profit margin(%) 55.7% 55.7% - - -

  6. Slide 6: Results 2021 (Net income)

    Results for period ended May 2021 (Net income) Increase in net income due to increase sales Unit: 100 million yen 0 10 20 30 40 50 60 70 80 90 100 110 Main factors causing change Period 2020 Net income 61 in net income Gross profit +42 Increase due to increase sales Increase in expenses for introduc

  7. Slide 7: Results 2021 (By business segment)

    Results for period ended May 2021 (By business segment) Increase in sales in all business segment Unit: 100 million yen Sales Operating income 2020 2021 Difference Difference(%) 2020 2021 Difference Difference(%) Domestic wholesale 164 167 3 2.0% 52 53 1 2.2% Overseas wholesale 368 438 69 18.9% 111

  8. Slide 8: Results 2021 (Sales by product)

    Results for period ended May 2021 (Sales by product） Significant increase in vegetable seeds due to strong sales of main crops Unit: 100 million yen 550 570 590 610 630 650 670 690 710 730 Main factors causing change Period 2020 Sales 617 in sales Increase in broccoli and tomato, Vegetable +60 Chang

  9. Slide 9: Results 2021 (Sales by customers' region)

    Results for period ended May 2021 (Sales by customers’ region） Increase sales in every region Unit: 100 million yen 550 570 590 610 630 650 670 690 710 Main factors causing change Period 2020 Sales 617 in sales Increase in vegetable seeds Japan +6 and materials North & Increase in vegetable and Cent

  10. Slide 10: Sales by region 2021 (1) Japan

    Sales by region for period ended May 2021 (1)【 Japan 】 Increase in vegetable seeds such as tomato and broccoli and materials Unit: 100 million yen Period 19/5月期 2019 246 +2 Period 20/5月期 2020 248（+0.9% ） -0 -0 -4 -0 -4 +11 Period +6 21/5月期 2021 254（+2.4% ） +3 +0 +0 -0 +3 ＋0 ■野菜種子 ■Vegetable seeds ■花

  11. Slide 11: Sales by region 2021 (2) North and Central America

    Sales by region for period ended May 2021 (2) [North and Central America] Significant increase in vegetable seeds due to strong sales of fruit vegetables, Strong sales in flower seeds Unit: million dollars Period 19/5月期 2019 93 15 108 Period 20/5月期 89 17 106 -2 2020 （-1.8%） Period 21/5月期 21/5月期 2021

  12. Slide 12: Sales by region 2021 (3) Europe and Middle East

    Sales by region for period ended May 2021 (3) [Europe and Middle East] Strong sales in vegetable seeds, flat flower seed sales Unit: million euros Period 19/5月期 2019 68 21 89 Period 20/5月期 72 23 95 ＋6 2020 （+6.9%） Period ＋7 21/5月期 21/5月期 2021 79 23 102 （+6.9%） ■Vegetable seeds ■Flower seeds and othe

  13. Slide 13: Sales by region 2021 (4) South America

    Sales by region for period ended May 2021 (4) [South America] Significant increase in sales due to strong sales of broccoli, fruit vegetables and sunflower Unit: million Real Period 19/5月期 2019 121 3 125 Period 20/5月期 132 0 132 +8 2020 （+6.1%） 4 164 （+24.1%） Period +32 21/5月期 21/5月期 2021 160 ■Vegeta

  14. Slide 14: Sales by region 2021 (5) Asia

    Sales by region for period ended May 2021 (5) [Asia] Significant increase in vegetable seeds, strong sale in flower seeds Unit: 100 million yen Period 19/5月期 2019 79 14 92 -4 Period 20/5月期 2020 74 14 88（-4.7%） Period +31 21/5月期 21/5月期 2021 101 18 119（+34.9%） ■Vegetable seeds ■Flower seeds and others

  15. Slide 15: Sales by region 2021 (6) Other regions

    Sales by region for period ended May 2021 (6) [Other regions (Africa and Oceania)] Increase in vegetable seeds in South Africa Unit: 100 million yen Period 19/5月期 2019 22 1 23 +0 Period 20/5月期 2020 22 1 23（+0.3%） Period 21/5月期 2021 23 2 25 ＋2 （＋6.5%） ■Vegetable seeds ■Flower seeds and others 2019/6-

  16. Slide 16: Main selling, general and administrative (SGA) expenses

    Main selling, general and administrative (SGA) expenses for period ended May 2021 Increase from the previous fiscal year due to the impact of foreign exchange rates and introduction cost of core IT system Unit: 100 million yen; consolidated basis (Breakdowns given on the basis of locations of head o

  17. Slide 17: Forecast for Period Ending May 2022 and Dividend Policy

    Ⅱ Forecast for Period Ending May 2022 and Dividend Policy Copyright©SAKATA SEED CORPORATION All Rights Reserved. 17

  18. Slide 18: Impact of applying a new revenue recognition standard and changing cost calculation

    Impact of applying a new revenue recognition standard and changing the cost calculation method New revenue recognition standard (ASBJ Statement No. 29) The “Accounting Standard for Revenue Recognition” will be applied from the beginning of the fiscal year ending May 2022. Main impacts on the company

  19. Slide 19: Forecast for period ending May 2022 (Consolidated bases)

    Forecast for period ending May 2022 (Consolidated bases) Expecting decrease in sales but increase in net income due to gain on sales of non-current assets Period 2022 Difference Unit:100 million yen Difference Period 2020 Period 2021 forcast (%) Total sales (Previous standard) 617 692 692 -0 -0.0% S

  20. Slide 20: Forecast for period ending May 2022 (Sales by product)

    Forecast for period ending May 2022 (Sales by product) Expecting increase in vegetable seeds, decrease in flower seeds, seedlings and materials Unit: 100 million yen 620 630 640 650 660 670 680 690 700 710 Major factors likely to 692 Period 2021 cause change in sales Actual sales Vegetable +15 Conti

  21. Slide 21: Forecast for period ending May 2022 (Sales by region)

    Forecast for period ending May 2022 (Sales by region) Expecting increase in oversea sales Unit: 100 million yen Major factors likely to 630 640 650 660 670 680 690 700 710 cause change in sales 692 Period 2021 Actual sales Decrease in some product sales due to change of product Japan -15 distributio

  22. Slide 22: Forecast for period ending May 2022 (Net income)

    Forecast for period ending May 2022 (Net income) Expecting increase in net income due to gain on extraordinary income Unit: 100 million yen 30 40 50 60 70 80 90 100 Major factors likely to 76 cause change in net Period 2021 Actual net income income Gross profit +0 Start depreciation of core IT syste

  23. Slide 23: Forecast for period ending May 2022 (Main SGA expenses)

    Forecast for period ending May 2022 (Main selling, general and administrative (SGA) expenses) Expecting increase in expenses for depreciation, R&D and etc. Unit: 100 million yen; consolidated basis (Breakdowns given on the basis of locations of head office and major subsidiaries) SGA expenses Person

  24. Slide 24: Capital investment (Results for past periods and forecast)

    Capital investment (Results for past 7 periods and forecast) Increase in total capital expenditure Unit: 100 million yen; consolidated basis 70 62 59 60 55 50 50 36 31 40 36 23 43 33 Overseas 30 20 26 Domestic 14 20 25 19 28 14 25 27 10 19 10 7 12 0 6 15/5 15/5 16/5 16/5 17/5 17/5 18/5 18/5 19/5 19/

  25. Slide 25: Dividend policy

    Dividend policy Year-end dividends for period 2021 is ¥23, For period 2022, ¥38 is expected. Our company considers the return of profits to shareholders to be an important management issue, and has adopted a basic policy of ensuring a stable and continuous distribution of profits while securing inte

  26. Slide 26: Notification of Stock Repurchase

    Notification of Stock Repurchase A resolution of the board was made for the repurchase of its stock with the aim of increasing shareholder returns and enhancing capital efficiency, as well as to implement flexible capital policy to suit the management environment. [Details of repurchase] (1) No. of

  27. Slide 27: Action for Global Growth

    Ⅲ Action for Global Growth Copyright©SAKATA SEED CORPORATION All Rights Reserved. 27

  28. Slide 28: Growth strategy of company group

    Growth strategy of company group R&D Dept. Sales & Marketing Dept. Establishment of healthy Establishment of a profitable profit structure and business model promoting key strategies in each region Development of a global Internal structural supply chain to boost supply development to foster global

  29. Slide 29: Core integrated system and global strategies

    Core integrated system and global strategies Background of rebuilding the IT infrastructure Separate individual plans for each Transform into a "plan that is shared and business department, e.g., business, committed to company-wide." sales, and production plans → Improve the efficiency of global man

  30. Slide 30: Purpose and benefits of introducing the new core IT system

    Purpose and benefits of introducing the new core IT system Completed thus far: The new core IT system went into operation in June 2021, and the transition was completed smoothly. • More efficient process for taking orders • More refined cost calculations • Higher level of sales and profit management

  31. Slide 31: Topics

    Ⅳ Topics Copyright©SAKATA SEED CORPORATION All Rights Reserved. 31

  32. Slide 32: Inauguration of 2027 World Horticultural Exhibition Yokohama Committee

    Topics Inauguration of 2027 World Horticultural Exhibition Yokohama Committee Promotion Committee Theme：Scenery of The Future for Happiness Duration: March-September 2027 Size of venue: 80 to 100 ha Venue: Kamiseya, in the northwest part of Yokohama Seya Ward. The area had long been in use of US mil

  33. Slide 33: Victory bouquets for Tokyo 2020 Olympic and Paralympic Games

    Topics Victory bouquets for Tokyo 2020 Olympic and Paralympic Games The flowers such as lisianthus, sunflower, gentian and etc. used for the bouquets are grown mainly in areas affected by the Great East Japan Earthquake in 2011 “Vegetable nourishes the people‘s body and flower nourishes the people’s

  34. Slide 34: Appendix

    Ⅴ Appendix 34

  35. Slide 35: Results 2021: Breakdown of external sales (1)

    Results for period ended May 2021: Breakdown of external sales (1) Others 3.6% Others 5.7% South America Bulbs 0.6% 4.6% Asia 17.2% Materials 11.4% Domestic 36.8％ Seedlngs 4.6% By region By product Flowers Europe & 10.7% Vegetables Middle East 67.0% 19.0％ North & Central America 18.8％ Copyright©SAKA

  36. Slide 36: Results 2021: Breakdown of external sales (2)

    Results for period ended May 2021: Breakdown of external sales (2) Difference of sales YoY by product and region (after eliminating internal transactions) Unit: 100 million yen Vegetables Flowers Seedlings Bulbs Materials Others Total North & Central America 12.6 1.5 0.0 － 0.6 0.1 14.8 Europe & Midd

  37. Slide 37: External sales by customers' region (Quarterly change)

    Results for period ended May 2021: External sales by customers’ region (Quarterly change) Overseas sales (by customers’ region) Unit: thousand in local currency/million yen 1st Qtr YoY YoY (%) 2nd Qtr YoY YoY (%) 3rd Qtr YoY YoY (%) 4th Qtr YoY YoY (%) Total YoY YoY (%) North & Central America ($US)

  38. Slide 38: Attention regarding forecasts

    Attention regarding forecasts This presentation document includes descriptions and materials on forecasts regarding performance, strategies and business plans of Sakata Seed Corporation. Those descriptions and materials are the Company’s estimates based on information available at the time of announ

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