Fuji Seal International, Inc. · TSE:7864
Fuji Seal International — FY2023 Earnings Presentation
39 slides from Fuji Seal International's earnings presentation, May 13, 2024
Slide 1: FY2023 Full Year Results Supplementary Briefing Materials
FY2023 Full Year Results Supplementary Briefing Materials Fuji Seal International, Inc. May 13, 2024 Copyright 2024 Fuji Seal Group
Slide 2: Table of Contents
Table of Contents 1. Consolidated Results for FY2023 2. Consolidated Forecasts for FY2024 3. Our vision ●Trend over the past quarter century (Consolidated Net sales and Operating income) ●Review of the previous Mid-Term Management plan ●New Management Plan - FSG.30 ●FSG.30 - Growth strategy - Growth
Slide 3: Consolidated result FY2023 (Ended March 31, 2024)
1. Consolidated result FY2023 (Ended March 31, 2024) Consolidated net sales is increased. Profits at each stage exceeded the revised forecasts, partly due to the effects of measures in each region and the impact of foreign exchange rates. Operating income exceeded the revised forecast by approxi
Slide 4: Consolidated result FY2023 (1) Net sales by region
1. Consolidated result FY2023 (1) Net sales by region Consolidated net sales increased 2.6% from the previous year on a local currency basis, impacted by Japan and the Americas. ～ FY2022 FY2022 FY2023 Year-on-year Full year 184,035 Excluding forex impact (Millions of yen) Full year Full year chang
Slide 5: Consolidated result FY2023 (2) Net sales by Product by Region
1. Consolidated result FY2023 (2) Net sales by Product by Region Year-on-year change FY2022 FY2023 Shrink Sleeve Label sales increased due to further price revisions, although volume was on a par with last Excluding forex impact (Millions of yen) Full year Full year Change Rate of change Rate of cha
Slide 6: Consolidated result FY2023 (3) Operating income by region
1. Consolidated result FY2023 (3) Operating income by region Progress was made in recovery in all regions, and profits increased 58.5% from the previous year on a local currency basis. FY2022 FY2023 In addition to price revisions for customers, portfolio Japan Year-on-year Excluding forex impact
Slide 7: Consolidated result FY2023 (4) Non-operating income, Ordinary Income and Net income
1. Consolidated result FY2023 (4) Non-operating income, Ordinary Income and Net income Increase/Decrease FY2022 FY2023 【Non-operating income】 (Millions of yen) Full year Full year ・Foreign exchange gains (+1,407 million yen) (Amount) (%) The main impact is the realization of Foreign exchange gains d
Slide 8: Consolidated result FY2023 (5) B/S
1. Consolidated result FY2023 (5) B/S (million-yen) Working capital increased due to foreign exchange effects and revenue increase. Goodwill increased due to the acquisition of a domestic subsidiary. Current assets Liabilities 117,064 60,542 (+7,041 compared to the end of the (+1.109 from the end
Slide 9: Consolidated result FY2023 (6) Cash flows from investing activities and depreciation
(million-yen) 1. Consolidated result FY2023 (6) Cash flows from investing activities and depreciation Free cash flow turned positive from negative in the previous year as business performance recovered, This is the highest operating cash flow in the company's history. 【Main CF from operating activ
Slide 10: Table of Contents
Table of Contents 1. Consolidated Financial Results for FY2023 2. Consolidated Financial Forecasts for FY2024 3. Our vision ●Trend over the past quarter century (Consolidated Net sales and Operating income) ●Review of the previous Mid-Term Management plan ●New Management Plan - FSG.30 ●FSG.30 - Grow
Slide 11: Consolidated forecast FY2024 (1) Overview of Consolidated Results
2. Consolidated forecast FY2024 (1) Overview of Consolidated Results FY2024 Increase/Decrease FY2023 Overview Full year ● Increase in sales and profits (Millions of yen) Full year (Amount) (%) (Forecast) Consolidated sales and profits at all stages are expected to increase. Net sales 196,624 203,000
Slide 12: Consolidated projection FY2024 (2) Net sales and Operating income by Region
2. Consolidated projection FY2024 (2) Net sales and Operating income by Region Year-on-year change FY2024 FY2023 Full year Excluding (Millions of yen) Full year Change Rate of change (Forecast) forex impact Consolidated net 196,624 203,000 +6,375 +3.2% +3.7% sales Japan 98,861 99,800 +938 +0.9% Amer
Slide 13: Consolidated projection FY2024 (3) Net sales by region and business segment
2. Consolidated projection FY2024 (3) Net sales by region and business segment Year-on-year change FY2024 - SSL sales are expected to decline slightly due to the decision to withdraw from unprofitable FY2023 (Millions of yen) Full year Excluding forex products and replace with high-value-added produ
Slide 14: Planned Dividends for FY2023 and Forecasted Dividends for FY2024
2.(4) Planned Dividends for FY2023 and Forecasted Dividends for FY2024 【Basic Policy on Profit Distribution】 2023 2024 schedule forecast Investments for continuous growth (technology development, human capital development, capital expenditures, M&A) Targeting a Consolidated dividend payout ratio
Slide 15: Table of Contents
Table of Contents 1. Consolidated Financial Results for FY2023 2. Consolidated Financial Forecasts for FY2024 3. Our vision ●Trend over the past quarter century (Consolidated Net sales and Operating income) ●Review of the previous Mid-Term Management plan ●New Management Plan - FSG.30 ●FSG.30 - Grow
Slide 16: Consolidated net sales and operating profit over the past quarter century
3. Consolidated net sales and operating profit over the past quarter century Founded in 1897, we developed the Shrink Sleeve Label in the 1950s and made a major business transition to a packaging manufacturer. Consolidated Guideline for Action “Changing along with changes”, we respond quickly to mar
Slide 17: Review and Revision of Previous Medium-Term Management Plan
3. Review and Revision of Previous Medium-Term Management Plan Net sales Sales FY2021-2023 Item FY2020 Actual KPI Target Value Results for FY2023 (Billions Consolidated net Operating profit of yen) sales profit ratio Themes to be tackled Consolidated net 2000 7.0% sales 163.6 billion yen 193.0 billi
Slide 18: New management plan - FSG.30
3. New management plan - FSG.30 Aims of FSG.30 formulation From the implementation of the previous Medium-Term Management Plan, we recognized that the time is now right and that it is ready to envision the next stage of the company's development. We envision what we want to be in the medium to long
Slide 19: Growth Strategies: Sustainable Business Growth
3. FSG.30 - Growth Strategies Further refining the strengths we have cultivated and our solid business foundation, we aim to achieve sustainable growth through three strategies Creation of new business models that will lead to the next generation Sustainable Business Growth → Page 31 Financial affai
Slide 20: FSG.30 - Growth Investment
3. FSG.30 - Growth Investment In the previous mid-term plan, we thoroughly strengthened appropriate investment selection and risk management, and established a system to realize FSG.30 growth investments. We aim to create valuable returns in order to invest more effectively and improve the execution
Slide 21: KPI Target Values
3. FSG.30 - KPI Target Values Performance Finance Shareholder return Sales ROE Profit Distribution Double-digit% same as Basic Policy 350 billion yen or more Current : 196.6 billion yen Current figure: 8.1%. Human capital Operating Profits PBR Group key position Successor Sufficiency Rate Double-dig
Slide 22: FSG.30 - Financial Strategies Current Market Valuation Analysis
financial affairs 3. FSG.30 - Financial Strategies Current Market Valuation Analysis ■PER: Since 2019, PER has declined due to deteriorating earnings and weak stock prices. Most recently, PER recovered to 11x by the end of FY2023, due to recovery in business, enhanced shareholder returns, and strong
Slide 23: FSG.30 - Financial Strategy Improve ROE
financial affairs 3. FSG.30 - Financial Strategy Improve ROE The FSG.30 target sets ROE at 2 digit percentages. The most recent ROE was 8.1%, and the company will accelerate three initiatives to further improve ROE. In addition, the company plans to announce measures to reduce the cost of shareholde
Slide 24: Improve ROE (1) Expand Profit by investing in growth
financial affairs 3. FSG.30 - Financial Strategy Improve ROE (1) Expand Profit by investing in growth FSG.30 Capital Allocation (FY2024 - FY2030) Growth investment -Creation of new business models that will lead to the next generation next generation -Expansion of product markets and target areas
Slide 25: Improve ROE (2) Improve capital efficiency
financial affairs 3. FSG.30 - Financial Strategy Improve ROE (2) Improve capital efficiency Over the past five years, the number of unprofitable businesses peaked in FY2021 and FY2022. Inversely, Operating margin has decreased largely over the same period. Capital efficiency will be improved in line
Slide 26: Improve ROE (3) Pursue Optimal Capital Structure
financial affairs FSG.30 - Financial Strategy Improve ROE (3) Pursue Optimal Capital Structure As the capital adequacy ratio rises, we will seek to further enhance shareholder returns and actively utilize borrowed capital, including the option of flexibly repurchasing and retiring Treasury stock as
Slide 27: FSG.30 - Business Strategy: Existing 4 Businesses
Steadily strengthen the 4 Production existing businesses units 3. FSG.30 - Business Strategy: Existing 4 Businesses Shrink Sleeve Label Pouch Become the Global No.1 Market Leader Global Expansion to become the 2nd core business - Further business expansion through aggressive investment in growth reg
Slide 28: FSG.30 - Business Strategy: Americas
Steadily strengthen the 4 existing businesses units 3. FSG.30 - Business Strategy: Americas • Stable GDP growth and population growth, demand for large-lot products, our specialty. • Shrink Sleeve Label / Machinery Applicators to capture the Mexican and Latin American markets. • Switch to RecShrink™
Slide 29: Business Strategy: Matrix Management + Decision Making from the Customer View
Valued customer 3. FSG.30 - Business Strategy: Matrix Management + Decision Making from the Customer View Previous Mid-Term FSG.30 Management Plan FSG.30 Goals (2024-2030) (2021-2023) Strengthen matrix management Matrix management Matrix management (business x region) + Customers Market-In Thinking
Slide 30: FSG.30 - Business Strategy: Pharmaceutical Business
Expansion of Product Market / Target 3. FSG.30 - Business Strategy: Pharmaceutical Business Pharmaceutical Packaging CMO Business Expansion Strategy Pharmaceutical Packaging CMO Sales Scale to 2030 ・Continue to specialize in existing secondary packaging business Tsukuba Plant: Small molecule seconda
Slide 31: FSG.30 - Business Strategy: Deep IS
Creation of new business models that will lead to the next generation 3. FSG.30 - Business Strategy: Deep IS ® Global anti-counterfeit packaging market ® (Billon US$） The global anti-counterfeit 3,000 packaging market is expected to continue to grow at a CAGR of over 10% and reach a market 2,000 siz
Slide 32: FSG.30 – Environmental Strategy
Environment ３．FSG.30 – Environmental Strategy Mitigate risks related to environmental issues and capture business opportunities by taking actions toward climate change and a circular economy. FSG will further promote actions for the "Protecting value" and the "Creating value" adding new GHG emission
Slide 33: HR Strategy: Vision and Principles for Human Capital
human capital 3.FSG.30 – HR Strategy: Vision and Principles for Human Capital “We, FSG believes that the essential resources of a company are talent, products, services, and capital. Products, services, and capital are created by talent. Therefore, employees are the key to our success and growth, an
Slide 34: HR Strategy: Enrichment of Human Capital
human capital 3.FSG.30 – HR Strategy: Enrichment of Human Capital Talent Management Our long-term success depends on the capacity to attract, retain, challenge, train and develop the current and future key people who can ensure ongoing and sustainable growth. Action Group Key Shirnk Label PSL Spoute
Slide 35: HR Strategy: Shared Values
human capital 3. FSG.30 – HR Strategy: Shared Values Culture and Engagement Conduct Groupwide engagement surveys to enhance the relationships between companies and the employees and improve employee's engagement and enablement. Conduct Action KPI Survey Inform & communicate with our employees to kee
Slide 36: HR Strategy: Respect for DE&I
human capital 3. FSG.30 - HR Strategy: Respect for DE&I DE＆I Inclusion and diversity are the driving force for improving the creativity and outcomes of individuals and teams. This is already integrated within our Credo, Mission and Vision. We recognize the value of our employees, including all their
Slide 37: Initiatives to Enhance Corporate Value
3. FSG.30 - Initiatives to Enhance Corporate Value Proactive disclosure of ESG information, including Number of IR/SR meetings From 2023, Opportunity Management for Investors dialogue with shareholders and investors environmental reports and external assessments, Interviews Integrated Report, and ES
Slide 38: Our Vision - To Be - Our Value to People and the Planet
Our Vision - To Be - Sustainable and profitable growth in the packaging industry Our Value to People and the Planet Our proactive impact to realize Generate "Waku-Waku" the Regenerative Society - No growth without "Waku-Waku" - Copyright 2024 Fuji Seal Group 38
Slide 39: Cautionary Statement
Cautionary Statement This report is intended to provide a better understanding of the Fuji Seal Group and is not intended as a recommendation for investment. This report includes earnings forecasts and business plans, which are based on certain assumptions in the economic environment and business po
Fuji Seal International — FY2023 Earnings Presentation on 6ix