Subaru Corporation · TSE:7270
Subaru — Fuji Heavy Industries — H1 FYE2014 Earnings Presentation
60 slides from Subaru's earnings presentation, Oct 31, 2013
Slide 1: Business Results for the 1st Half of FYE2014
Business Results for the 1st Half of FYE2014 Fuji Heavy Industries Ltd. President & CEO Yasuyuki Yoshinaga October 31, 2013 http://www.fhi.co.jp/english/ir/index.html 0
Slide 2: 1st half: Consolidated operating results
1st half : Consolidated operating results （100 Million Yen） Actual results Actual results 1st half 1st half YoY FYE2013 FYE2014 Consolidated automobile sales 348.4 392.6 Record - high +12.7% Net sales 8,980 11,256 Record +25.3% - high Operating income 433 1,507 Record +248.4% - high Ordinary income
Slide 3: US market: Retail sales from Jan. to Sep.
US market : Retail sales from Jan. to Sep. Retail sales from Jan. to Sep. : 313,400 （YoY+27.7％） Total Successful launch of new （1,000 cars） 193.6 195.6 245.5 313.4 model 350 (149.1％ vs.2012) 6 BRZ 300 1 TRIBECA 3 84 FORESTER 250 2 57 Keeping sales momentum 200 2 2 IMPREZA (153.5％ vs.2012) 56 98 64 /
Slide 4: US market: High evaluation of Subaru products
US market : High evaluation of Subaru products <Forester> Posted an all-time monthly sales record with 13,119 units in August. Awarded MOTOR TREND’s 2014 SUV of the year. ＜IIHS＞ All Subaru models awarded the 2013 TOP SAFETY PICK for four consecutive year. - Subaru remains the only manufacture -
Slide 5: US market: Retail sales plan
US market : Retail sales plan CY2013 : 420,000 units (YoY+24.9％) YoY increase for the 6th consecutive year; All time record for the 5th consecutive year (1,000 cars) 420 365 336 264 267 Forester Previous Revised CY2010 CY2011 CY2012 CY2013 (Plan) XV Crosstrek http://www.fhi.co.jp/english/ir/index.ht
Slide 6: Japan: Retail sales plan
Japan : Retail sales plan CY2013 : 179,000 units (YoY+0.9%) Continued good sales of Forester and Subaru XV (1,000 cars) 177 178 179 159 164 55 70 Minicars 56 98 85 Forester Passenger cars 125 108 109 79 74 Previous Revised CY2010 CY2011 CY2012 CY2013 (Plan) XV Hybrid http://www.fhi.co.jp/english/ir/
Slide 7: Full year: Consolidated operating plan
Full year : Consolidated operating plan （100 Million Yen） FYE2013 FYE2014 YoY Actual results Previous plan Revised plan Consolidated automobile sales 724.5 751.5 807.3 Record - high +11.4% Net sales 19,130 20,800 23,000 Record +20.2% - high Operating income 1,204 1,980 2,780 Record +130.9% - high Or
Slide 8: Japan: Number of vehicle production
Number of vehicle production Plan of FYE2014 : 815,000（YoY+6.6％） 322.3 301.2 246.6 392.0 359.9 404.4 390.4 424.6 (1,000 cars) 83 94 80 102 87 SIA 78 87 69 342 290 311 310 Japan 245 273 214 178 1st half 2nd half 1st half 2nd half 1st half 2nd half 1st half 2nd half (Plan) FYE2011 FYE2012 FYE2013 FYE2
Slide 9: Strengthening of financial underpinnings
Strengthening of financial underpinnings （100 Million Yen） FCF Interest bearing debt Shareholders' equity to total assets 4,000 3,866 3,410 41.2% 3,500 3,367 3,306 3,301 3,072 2,918 40% 3,000 2,500 37.7% 2,000 34.7% 1,500 34.2% 34.2% 35% 33.6% 1,198 33.3% 1,000 778 640 500 231 236 47 175 0 30% 2010年
Slide 10: Dividend plan
Dividend plan （Cash dividends per share） FYE2013 FYE2014 Increase / Previous plan Revised plan Decrease Actual results (b) – (a) (a) (b) 2nd quarter ¥5 ¥10 ¥20 +¥10 Year-end ¥10 ¥10 ¥20 +¥10 Annual ¥15 ¥20 ¥40 +¥20 http://www.fhi.co.jp/english/ir/index.html 9
Slide 11: Further enhancement of production capacity
Further enhancement of production capacity Motion-Ⅴ mid-term management plan Next plan Additional capacity increase Yajima plant Main Plant ＳＩＡ (1,000 cars) 922 757 772 792 822 692 742 300 170 170 200 170 170 170 150 165 180 200 200 200 100 422 422 422 422 422 422 422 Mar. 2012 Aug. 2012 Jan. 2013 S
Slide 12: Mid-term management plan
Mid-term management plan Progress of Motion-V mid-term management plan Interim evaluation: To be achieved major numerical targets Activities are mostly progressing well New themes: Further enhancement of product appeals including environmental response Upgrading customer care including after
Slide 13: The 43rd Tokyo Motor Show 2013
The 43rd Tokyo Motor Show 2013 LEVORG VIZIV EVOLUTION CONCEPT http://www.fhi.co.jp/english/ir/index.html 12
Slide 14: Next generation EyeSight
Next generation “EyeSight” Fully revamped the current EyeSight (ver.2) Improved recognition accuracy by adopting color recognition stereo camera technology Approximately 40% increase of viewing angle and visibility distance Steering assist controls further enhancing its safety performance
Slide 15: http://www.fhi.co.jp/english/ir/index.html
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Slide 16: Presentation of Business Results for the 1st Half of FYE2014
Presentation of Business Results for the 1st Half of FYE 2014 Director of the Boards & CFO, Mitsuru Takahashi October 31, 2013 http://www.fhi.co.jp/english/ir/index.html 0
Slide 17: Summary
Summary Financial results for the 1st half of FYE March 2014 Due to strong sales of Forester and Impreza series in Japan and North America, consolidated vehicle sales set an all-time records for a fiscal half-year period. Due to gain on currency exchange, unit sales increase and mix improvement, c
Slide 18: Business results for the 1st half of FYE March 2014
Business results for the 1st half of FYE March 2014 http://www.fhi.co.jp/english/ir/index.html 2
Slide 19: 1st Half: Consolidated Automobile Sales
1st Half : Consolidated Automobile Sales （Thousand Units） Actual results Actual results Increase / 1st half 1st half Decrease FYE 2013 FYE 2014 Passenger car 45.4 61.7 +16.4 Minicar 26.6 25.6 -1.0 Domestic total 72.0 87.3 +15.4 U.S. 164.4 208.9 +44.6 Canada 16.3 18.7 +2.4 Russia 11.1 6.8 -4.3 Europe
Slide 20: 1st Half: Consolidated Income Statement
1st Half : Consolidated Income Statement （100 Million Yen） Actual results Actual results Increase / 1st half 1st half Decrease FYE 2013 FYE 2014 Net sales 8,980 11,256 +2,276 Domestic 3,098 3,306 +208 Overseas 5,883 7,951 +2,068 Operating income 433 1,507 +1,074 Ordinary income 453 1,462 +1,009 Inco
Slide 21: 1st Half: Analysis of Increase and Decrease in Operating Income
1st Half : Analysis of Increase and Decrease in Operating Income Changes (Consolidated) （100 Million Yen） US$ : +758 Reduction in cost EURO : +20 Increase of R&D expenses CA$ : +49 Gain on +135 Currency exchange currency -50 adjustment : +45 exchange Increase of +872 SG&A Improvement expenses of sal
Slide 22: Automobile Segment (Consolidated)
Automobile Segment (Consolidated) （100 Million Yen） Net sales Operating income +26.8 ％ +258.4 ％ 10,527 1,423 8,304 397 Actual results 2012年3月期 Actual results 2013年3月期 Actual results 2012年3月期 Actual results 2013年3月期 1H of FYE2013 1H of FYE2014 1H of FYE2013 1H of FYE2014 Mainly due to gain on curren
Slide 23: Aerospace Segment (Consolidated)
Aerospace Segment (Consolidated) （100 Million Yen） Net sales Operating income +28.4 ％ +266.1 ％ 535 69 417 19 2012年3月期 2013年3月期 Actual results 2012年3月期 Actual results 2013年3月期 Actual results Actual results 1H of FYE2013 1H of FYE2014 1H of FYE2013 1H of FYE2014 Both net sales and operating income we
Slide 24: Industrial Products Segment (Consolidated)
Industrial Products Segment (Consolidated) （100 Million Yen） Net sales Operating income -3.6 ％ -57.5 ％ 4 163 157 2 Actual results 2012年3月期 Actual results 2013年3月期 Actual results 2012年3月期 Actual results 2013年3月期 1H of FYE2013 1H of FYE2014 1H of FYE2013 1H of FYE2014 Despite gain on currency exchang
Slide 25: 1st Half: Non-Operating Income & Expenses and Extraordinary Income & Loss
1st Half : Non-Operating Income & Expenses and Extraordinary Income & Loss (Consolidated) （100 Million Yen） Actual results Actual results Increase / 1st half 1st half Decrease FYE 2013 FYE 2014 Financial revenue and -6 +0 +7 expenditure FOREX effects 34 -39 -73 Equity in earnings of affiliates 1 1 +
Slide 26: Consolidated Balance Sheets
Consolidated Balance Sheets （100 Million Yen） Increase / As of Mar. 2013 As of Sep. 2013 Decrease Total assets 15,775 17,193 +1,418 Current assets 9,440 10,511 +1,071 Noncurrent assets 6,334 6,681 +347 Interest bearing debts 3,072 2,918 -153 Net assets 5,968 7,112 +1,144 Retained earnings 3,014 3,93
Slide 27: 1st Half: Consolidated Statement of Cash Flows
1st Half : Consolidated Statement of Cash Flows （100 Million Yen） Actual results Actual results Increase / 1st half 1st half Decrease FYE 2013 FYE 2014 Net cash provided by (used in) operating activities 1,103 1,579 +477 Net cash provided by (used in) investing activities -324 -381 -57 Free cash flo
Slide 28: 1st Half: Operating Results of Subsidiaries in U.S.
1st Half : Operating Results of Subsidiaries in U.S. （Million US$） Actual results Actual results Increase / SOA 1st half 1st half Decrease FYE 2013 FYE 2014 Net sales 4,074 5,179 +1,105 Operating income 100 117 +17 Net income 64 72 +8 Retail sales (Thousand units) 164.4 220.3 +55.9 Actual results Ac
Slide 29: Outlook for the term ending FYE March 2014
Outlook for the term ending FYE March 2014 http://www.fhi.co.jp/english/ir/index.html 13
Slide 30: Full Year: Consolidated Automobile Sales
Full Year : Consolidated Automobile Sales （Thousand Units） Actual results Plan Increase / FYE 2013 FYE 2014 Decrease Passenger cars 112.8 116.3 +3.5 Minicars 50.4 53.6 +3.2 Domestic Total 163.1 169.9 +6.7 U.S. 357.6 434.8 +77.2 Canada 32.6 35.9 +3.3 Russia 14.7 15.4 +0.7 Europe 46.4 34.6 -11.8 Austr
Slide 31: Full Year: Consolidated Operating Plan
Full Year : Consolidated Operating Plan （100 Million Yen） Actual results Plan Increase / FYE 2013 FYE 2014 Decrease Net sales 19,130 23,000 +3,870 Domestic 6,718 6,437 -281 Overseas 12,411 16,563 +4,151 Operating income 1,204 2,780 +1,576 Ordinary income 1,006 2,720 +1,714 Income before income taxes
Slide 32: Analysis of Increase and Decrease in Operating Income Changes
Analysis of Increase and Decrease in Operating Income Changes (consolidated) US$ : +1,264 （100 Million Yen） EURO : +42 Reduction in cost CA$ : +76 Gain on Increase of R&D expenses Currency currency +174 exchange exchange -109 adjustment : -48 +1,334 Increase of SG&A Improvement expenses of sales FHI
Slide 33: Full Year: Operating Plan of Subsidiaries in U.S.
Full Year : Operating Plan of Subsidiaries in U.S. （million US$） Actual results Plan Increase / SOA FYE 2013 FYE 2014 Decrease Net sales 8,805 10,808 +2,003 Operating income 133 175 +42 Net income 97 109 +12 Retail sales (Thousand units) 347.1 430.0 +82.9 Actual results Plan Increase / SIA FYE 2013
Slide 34: Capex / Depreciation / R&D / Interest bearing debt
Capex / Depreciation / R&D / Interest bearing debt （100 Million Yen） FYE2013 FYE2014 Increase Actual results Actual Results Actual Results Plan / Decrease 1st half FYE2013 1st half FYE FYE2014 (b) - (a) FYE2013 (a) 2014 (b) Capex 339 702 273 720 +18 Depreciation 247 559 260 550 -9 R&D 249 491 299 60
Slide 35: Appendix (1)
Appendix (1) ・Segment information ・Segment ・ Overseas net sales ・Overseas ・ Non-consolidated automobile sales ・Non-consolidated ・ 2nd quarter, consolidated statements income ・2nd ・ 2nd half, consolidated statements income ・2nd http://www.fhi.co.jp/english/ir/index.html 19
Slide 36: Net Sales and Operating Income by Business Segment
1st Half : Consolidated Net Sales and Operating Income by Business Segment （100 Million Yen） Net sales Operating income Actual Actual Actual Actual results results Increase / results results Increase / 1st half 1st half Decrease 1st half 1st half Decrease FYE 2013 FYE 2014 FYE 2013 FYE 2014 Automobi
Slide 37: Operating Income by Geographic Area
1st Half : Consolidated Operating Income by Geographic Area （100 Million Yen） Net sales Operating income Actual Actual Actual Actual results results Increase / results results Increase / 1st half 1st half Decrease 1st half 1st half Decrease FYE 2013 FYE 2014 FYE 2013 FYE 2014 Japan 4,376 4,691 +314
Slide 38: 1st Half: Overseas Net Sales
1st Half : Overseas Net Sales （100 Million Yen） Actual results Actual results Increase / 1st half 1st half Decrease FYE 2013 FYE 2014 North America 4,017 6,172 +2,155 Europe 719 562 -157 Asia 578 582 +5 Other 569 635 +65 Total 5,883 7,951 +2,068 http://www.fhi.co.jp/english/ir/index.html 22
Slide 39: 1st Half: Non-Consolidated Automobiles Sales
1st Half : Non-Consolidated Automobiles Sales （100 Million Yen） Actual results Actual results Increase / 1st half 1st half Decrease FYE 2013 FYE 2014 Domestic production 272.5 310.1 +37.6 Domestic sales 72.6 91.9 +19.3 Passenger cars 47.4 64.8 +17.3 Minicars 25.2 27.2 +2.0 Number of vehicles exporte
Slide 40: 2nd Quarter: Consolidated Automobile Sales
2nd Quarter : Consolidated Automobile Sales （Thousand Units） Actual Results Actual Results Increase / 2nd Quarter 2nd Quarter Decrease FYE March 2013 FYE March 2014 Passenger car 27.7 33.0 +5.3 Minicar 13.4 13.6 +0.2 Domestic total 41.1 46.6 +5.5 U.S. 81.9 102.5 +20.6 Canada 9.6 9.3 -0.3 Russia 5.5
Slide 41: 2nd Quarter: Consolidated Income Statement
2nd Quarter : Consolidated Income Statement （100 Million Yen） Actual Results Actual Results Increase / 2nd Quarter 2nd Quarter Decrease FYE March 2013 FYE March 2014 Net sales 4,691 5,787 +1,096 Domestic 1,671 1,729 +58 Overseas 3,020 4,058 +1,038 Operating income 259 811 +551 Ordinary income 262 81
Slide 42: 2nd Quarter: Analysis of Operating Income Changes
2nd Quarter : Analysis of Increase and Decrease in Operating Income Changes (Consolidated) （100 Million Yen） US$ : +410 EURO : +13 Gain on Reduction in cost Increase of R&D expenses CA$ : +28 currency Currency exchange adjustment : +20 exchange +55 -52 +471 Decrease of SG&A expenses Improvement FHI
Slide 43: 2nd Half: Consolidated Automobile Sales
2nd Half : Consolidated Automobile Sales （Thousand Units） Actual Results Plan Increase / 2nd Half 2nd Half Decrease FYE March 2013 FYE March 2014 Passenger car 67.4 54.5 -12.8 Minicar 23.8 28.0 +4.2 Domestic total 91.1 82.5 -8.6 U.S. 193.2 225.9 +32.7 Canada 16.3 17.2 +0.9 Russia 3.6 8.6 +5.0 Europe
Slide 44: 2nd Half: Consolidated Statements Income
2nd Half : Consolidated Statements Income （100 Million Yen） Actual Results Plan Increase / 2nd Half 2nd Half Decrease FYE March 2013 FYE March 2014 Net sales 10,149 11,744 +1,594 Domestic 3,621 3,131 -489 Overseas 6,529 8,612 +2,083 Operating income 772 1,273 +501 Ordinary income 553 1,258 +705 Inco
Slide 45: 2nd Half: Analysis of Operating Income Changes
2nd Half : Analysis of Increase and Decrease in Operating Income Changes (Consolidated) US$ : +505 （100 Million Yen） EURO : +22 Gain on Reduction in cost CA$ : +27 Currency currency +39 Increase of R&D expenses exchange exchange -58 adjustment : -92 +462 Increase of Improvement FHI : +22 SG&A SIA :
Slide 46: Appendix (2)
Appendix ((2) 2) ・1st half, Plan vs. Actual results ・1st ・ Full year, Previous plan vs. revised plan ・Full http://www.fhi.co.jp/english/ir/index.html 30
Slide 47: 1st Half Automobile Sales: Plan vs. Actual Results
1st Half : Consolidated Automobile Sales Plan vs. Actual Results （Thousand Units） Plan Actual Results Increase / 1st Half 1st Half Decrease FYE March 2014 FYE March 2014 Passenger car 55.1 61.7 +6.7 Minicar 25.9 25.6 -0.3 Domestic total 80.9 87.3 +6.4 U.S. 210.5 208.9 -1.6 Canada 18.7 18.7 -0.1 Russ
Slide 48: 1st Half Income Statement: Plan vs. Actual Results
1st Half : Consolidated Income Statement Plan vs. Actual Results （100 Million Yen） Plan Actual Results Increase / 1st Half 1st Half Decrease FYE March 2014 FYE March 2014 Net sales 10,600 11,256 +656 Domestic 3,100 3,306 +205 Overseas 7,500 7,951 +451 Operating income 1,130 1,507 +377 Ordinary incom
Slide 49: 1st Half: Analysis of Operating Income Changes vs. Plan
1st Half : Analysis of Increase and Decrease in Operating Income Changes (Consolidated) Decrease of SG&A （100 Million Yen） US$ : +206 expenses and others Increase of R&D expenses EURO : ±0 CA$ : +9 +47 -11 Currency exchange Reduction adjustment : +30 Decrease in cost of R&D expenses +45 Loss on curr
Slide 50: Full Year Automobile Sales: Previous Plan vs. Revised Plan
Full year : Consolidated Automobile Sales Previous Plan vs. Revised Plan （Thousand Units） Previous Plan Revised Plan Increase / FYE March 2014 FYE March 2014 Decrease Passenger car 101.6 116.3 +14.6 Minicar 53.9 53.6 -0.3 Domestic total 155.5 169.9 +14.4 U.S. 384.9 434.8 +49.9 Canada 35.5 35.9 +0.4
Slide 51: Full Year Income Statement: Previous Plan vs. Revised Plan
Full year : Consolidated Income Statement Previous Plan vs. Actual Results （100 Million Yen） Previous Plan Revised Plan Increase / FYE March 2014 FYE March 2014 Decrease Net sales 20,800 23,000 +2,200 Domestic 6,081 6,437 +357 Overseas 14,719 16,563 +1,843 Operating income 1,980 2,780 +800 Ordinary
Slide 52: Full Year: Analysis of Operating Income Changes
Full year : Analysis of Increase and Decrease in Operating Income Changes (Consolidated) US$ : +485 （100 Million Yen） EURO : +3 CA$ : +25 Gain on Reduction in cost Currency currency Decrease of R&D expenses exchange +54 adjustment : +2 exchange -10 +515 Increase of SG&A Improvement FHI : +38 expense
Slide 53: Appendix (3)
Appendix ((3) 3) ・ Net sales / Operating income ・Net ・ Consolidated automobile sales / OPM ・Consolidated ・ Complete cars production / Retail sales ・Complete ・ FCF / Shareholders ・FCF Shareholders’’ equity to total assets ・ Interest bearing debt / D/E ratio ・Interest http://www.fhi.co.jp/english/ir/i
Slide 54: Net Sales & Operating Income
Net Sales & Operating Income Net Sales Operating Income (100 million yen) （100 million yen) ¥83$ ¥83/$ ¥82/$ ¥79/$ ¥77/$ ¥78/$ ¥81/$ ¥79/$ ¥79/$ ¥89/$ ¥98/$ ¥98/$ 6,000 5,787 1,000 Net sales Operating income 5,422 5,469 900 4,877 5,000 4,691 4,727 811 800 4,289 4,059 700 696 4,000 3,706 3,744 3,546
Slide 55: Consolidated Automobile Sales & Operating Income Margin
Consolidated Automobile Sales & Operating Income Margin Automobile sales OPM (1,000 cars) 230 Automobile sales OPM 16% 208 198 202 19114.0% 183 178 13% 180 169 166 166 157 12.7% 148 11% 130 118 8.7% 8% 80 6.4% 5.5% 5% 4.4% 3.6% 2.4% 4.0% 30 2.3% 3.3% 3% 2.6% -20 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 0
Slide 56: Complete Cars Production & Retail Sales
Complete Cars Production & Retail Sales Units （1000 units) Production Retail Sales 211 213 207 196 196 191 197 195 197 193 200 182 178 177 167 172 164 162 156 158 147 150 150 138 136 111 100 50 0 Oct.- Jan.- Apr.- Jul.- Oct.- Jan.- Apr.- Jul.- Oct.- Jan.- Apr.- Jul.- Dec. Mar. Jun. Sep. Dec. Mar. Ju
Slide 57: Free Cash Flows & Shareholders' Equity to Total Assets
Free Cash Flows & Shareholders’ Equity to Total Assets FCF Shareholders’ Equity to （100 million yen) Total Assets 1,198 45% 1,100 953 900 871 41.2% 778 39.9% 40% 700 646 516 500 37.7% 397 34.7% 34.2% 283 35.2% 35% 300 35.4% 33.7% 221 34.7% 34.2% 33.7% 78 33.3% 100 47 -100 -42 30% 3Q 4Q 1Q 2Q 3Q 4Q 1
Slide 58: Interest Bearing Debts & D/E Ratio
Interest Bearing Debts & D/E Ratio Interest Bearing Debts D/E ratio (100 million yen) Interest bearing debt D/E ratio 4,500 3,965 3,866 1.4 4,000 3,688 3,306 3,410 3,381 1.2 3,500 3,301 3,236 3,179 3,072 2,967 2,918 3,000 0.91 1.0 0.80 0.89 0.85 2,500 0.76 0.76 0.8 0.74 0.69 2,000 0.64 0.52 0.6 1,50
Slide 59: Forward-looking statements
Forward-looking statements including projections and future strategies mentioned in this presentation are based on currently available information and assumptions and are subject to risks and uncertainties. Actual results may vary materially as a result of various factors including, without limitati
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Fuji Heavy Industries — H1 FYE2014 Earnings Presentation on 6ix