Nsk Ltd. · TSE:6471
Nsk — H1 FY2015 Earnings Presentation
33 slides from Nsk's earnings presentation, Nov 2, 2015
Slide 1: Financial Conference: Consolidated Business Results and Forecast
FINANCIAL CONFERENCE Consolidated Business Results and Forecast November 2, 2015 NSK Ltd. Cautionary Statements with Respect to Forward-Looking Statements Statements made in this report with respect to plans, strategies and future performance that are not historical fact are forward-looking statemen
Slide 2: Contents
Contents 1. Consolidated Business Results for the Six Months Ended September 30, 2015 2. Consolidated Business Forecast for the Year Ending March 31, 2016 3. Forecast of the 4th Mid-Term Management Plan 4. Policy of the 5th Mid-Term Management Plan (Supplementary Information) 1
Slide 3: 1. Consolidated Business Results for the Six Months Ended September 30, 2015
1. Consolidated Business Results for the Six Months Ended September 30, 2015 2
Slide 4: Summary of Consolidated Business Results
Summary of Consolidated Business Results for the Six Months Ended September 30, 2015 Business Environment ✓Industrial Machinery Business: Variation by sector, but clearly slowing overall, with concern for China’s economy ✓Automotive Business: Production cutbacks continued in China, while demand rema
Slide 5: Summary of Consolidated Business Results for the Six Months Ended September 30, 2015
Summary of Consolidated Business Results for the Six Months Ended September 30, 2015 (Billions of yen) FY2014 1st half FY2015 1st half Increase/ Difference FY2015 1st half Decrease <Original forecast <Actual> <Actual> YOY YOY in May> Net sales 464.4 489.7 +25.3 +5.5% 490.0 Operating income 40.7 49.4
Slide 6: Results by Business Segment
Results by Business Segment (Billions of yen) FY2014 1st half FY2015 1st half Increase/ Difference FY2015 1st half Decrease <Original forecast <Actual> <Actual> YOY YOY in May> Net sales 464.4 489.7 +25.3 +5.5% 490.0 Industrial machinery business 132.5 136.6 +4.0 +3.0% 142.5 Industrial machinery bea
Slide 7: Quarterly Business Performance
Quarterly Business Performance Sales Operating Income / Margin Automotive increased due to strong Although overall operating income in 2Q production in NA. 2Q Sales increased YOY increased significantly YOY, it contracted driven by depreciation of the Japanese yen. from 1Q results. Margin remained s
Slide 8: Operating Income: Factors Behind Increase
Operating Income: Factors Behind Increase (FY2014 1st Half ⇒ FY2015 1st Half) (Billions of yen) Effect of exchange rate fluctuations 49.4 +8.1 40.7 sales Decline in price Reduction of external procurement costs -3.3 Increase in Volume +4.8 other costs increase etc. -3.4 +2.5 FY2014 1st half +8.7 FY2
Slide 9: Business Results by Customer Location
Business Results by Customer Location (Billions of yen) FY2014 1st half FY2015 1st half Increase/ Difference <Actual> <Actual> Decrease YOY YOY Net sales 464.4 489.7 +25.3 +5.5% Japan 162.6 162.0 -0.7 -0.4% Non-Japan 301.7 327.8 +26.0 +8.6% (Non-Japan ratio) (65.0%) (66.9%) The Americas 76.8 92.3 +1
Slide 10: Inventories / Interest-Bearing Debt, Capital Expenditure / Depreciation and Amortization
Inventories / Interest-Bearing Debt, Capital Expenditure / Depreciation and Amortization Inventories Capital Expenditure (Billions of yen) (Billions of yen) Japan Non-Japan Japan Non-Japan 7.1 6.9 6.7 30.1 144.2 142.2 140.2 19.9 16.8 19.5 93.1 90.1 90.1 10.8 11.4 51.0 52.1 50.1 10.6 9.2 5.4 End of S
Slide 11: 2. Consolidated Business Forecast for the Year Ending March 31, 2016
2. Consolidated Business Forecast for the Year Ending March 31, 2016 10
Slide 12: Summary of Consolidated Business Forecast for the Year Ending March 31, 2016
Summary of Consolidated Business Forecast for the Year Ending March 31, 2016 Forecasted Business Environment ✓ To see shifts in demand ✓ Recovery in Japan to be slower than expected. Concern over the impact China’s slowdown will have on the global economy. Keeping an eye on the timing of rate rises
Slide 13: Summary of Consolidated Business Forecast for the Year Ending March 31, 2016 (FY2015)
Summary of Consolidated Business Forecast for the Year Ending March 31, 2016 (FY2015) (Billions of yen) FY2014 FY2015 Increase/ Full year 1st half 2nd half Full year Decrease Change Full year <Actual> <Actual> <Revised forecast> <Revised forecast> YOY YOY <May Forecast> Net sales 974.9 489.7 490.3 9
Slide 14: Forecast by Business Segment
Forecast by Business Segment (Billions of yen) FY2014 FY2015 Increase/ Full year 1st half 2nd half Full year Decrease Change Full year <Actual> <Actual> <Revised forecast> <Revised forecast> YOY YOY <May Forecast> Net sales 974.9 489.7 490.3 980.0 +5.1 +0.5% 1,020.0 Industrial machinery business 276
Slide 15: Operating Income: Factors Behind Decrease
Operating Income: Factors Behind Decrease (FY2014 ⇒ FY2015 Revised Forecast) (Billions of yen) 97.3 Decline in sales price Effect of exchange rate fluctuations 94.0 -8.0 Increase in Reduction of external +5.5 other costs procurement costs +7.5 -11.3 Volume increase etc. +3.0 -3.3 FY2014 FY2015 Revis
Slide 16: Forecast by Customer Location
Forecast by Customer Location (Billions of yen) FY2014 FY2015 Increase/ Full year 1st half 2nd half Full year Decrease Change Full year <Actual> <Actual> <Revised forecast> <Revised forecast> YOY YOY <May Forecast> Net sales 974.9 489.7 490.3 980.0 +5.1 +0.5% 1,020.0 Japan 328.8 162.0 160.5 322.5 -6
Slide 17: 3. Forecast of the 4th Mid-Term Management Plan
3. Forecast of the 4th Mid-Term Management Plan 16
Slide 18: The 4th Mid-Term Management Plan: Outline
The 4th Mid-Term Management Plan: Outline Establishing corporate fundamentals appropriate for a company with net sales of ¥1 trillion 《The 4th Mid-term Management Plan》 Numerical Final Year Targets Forecast Business Strategies Corporate Foundation FY2015 FY2015 Develop management capability to Growt
Slide 19: The 4th Mid-Term Management Plan: Consolidated Business Trend
The 4th Mid-Term Management Plan: Consolidated Business Trend The 4th Mid-term Plan Operating Income % 16.1% 15.3% 14.0% 14.0% ROE 11.9% 12.1% 10.3% 10.6% 8.0% 9.2% 3.4% 5.2% 3.4% 2.0% 10.0% 9.6% 8.7% 9.0% 7.8% 5.0% 6.6% 6.8% 6.1% 6.1% 4.4% (Billions of yen) -1.4% 1.8% 1.9% 120 (Billions of yen) 1,0
Slide 20: Industrial Machinery Business: FY2015 Business Environment and Forecast
Industrial Machinery Business FY2015 Business Environment and Business Forecast Demand Trend by Sector (Billions of yen) Net Sales Precision Machinery ※Changes from original forecast :△ Upward, －Same level, ▼Downward 400 and Parts Original Latest Forecast (1H vs. 2H) 300.0 (YOY) 276.4 Sector 300 255
Slide 21: Automotive Business: Vehicle Production and Business Forecast
Automotive Business Vehicle Production and Business Forecast Global Vehicle Production Volume (Billions of yen) Net Sales Japan NA Europe China ASEAN6 Others (Millions of vehicles) 800 100.0 90.2 88.4 657.0 688.0 87.1 87.5 80.0 82.9 590.5 590.0 Components Automotive 80.0 15.1 13.8 14.3 14.2 600 15.5
Slide 22: 4. Policy of the 5th Mid-Term Management Plan
4. Policy of the 5th Mid-Term Management Plan 21
Slide 23: Positioning of the 5th Mid-Term Management Plan (FY16-FY18)
Positioning of the 5th Mid-Term Management Plan (FY16-FY18) 2016=100th Anniversary 1st MTP 2nd MTP 3rd MTP 4th MTP 5th MTP FY03-FY05 FY06-FY08 FY09-FY12 FY13-FY15 FY16-FY18 2026 Embark on New Select & focus Respond to Developing Chapter in NSK strategies, assembly Growth strategies, paradigm shifts,
Slide 24: NSK Vision 2026: Setting the Future in Motion
NSK Vision 2026 SETTING THE FUTURE IN MOTION We bring motion to life, to enrich lifestyles, and to build a brighter future. Dedicated to uncovering society's needs, we set ideas in motion to deliver solutions beyond imagination. We're NSK. And, we're setting the future in motion. 23
Slide 25: The 5th MTP Outline
The 5th MTP Outline NSK Vision 2026 Setting the Future in Motion Embark on new chapter in evolution toward next 100 years Sustainable Growth Deliver new value to society Work together with stakeholders Operational Establish solid profit base Innovate Increase and stabilize profitability Excellence R
Slide 26: 5th MTP and Long-Term Sales & Profit Targets
5th MTP and Long-Term Sales & Profit Targets 4th MTP 5th MTP Operating Income % (Billions of yen) （Billions of yen） 200 1,400 10.0% 9.6% 180 1.9% 7.8% 6.1% 6.1% 4.4% 1,200 MTP Original 160 Net Sales （left） 974.9 980.0 140 1,000 Operating Income (right) 871.7 120 800 733.2 732.8 710.4 97.3 94.0 100 5
Slide 27: Industrial Machinery Business: Growth Beyond the Business Cycle
Industrial Machinery Business Business Environment Sales Growth Index 150 ●GDP growth rate (Global) FY16-FY18 Avg.3.8%/year １００ ●Developed countries - acceleration of 100 technologic advancement ●Emerging economies – economic stagnation, 50 infrastructure-related demand stable ●Increasing focus on e
Slide 28: Automotive Bearing Business
Automotive Bearing Business Vehicle Production Forecast by Power Source Sales Growth Vehicle Production ： FY15 88M / FY19 100M / FY16 130M Auto BRG AutoProd Actual Forecast Index 150 EV HEV １００ 100 ICE Internal Combustion 50 Engine 0 FY2026 ICE:89% HEV:10% EV:1% FCV:0.01% Maximize Opportunities from
Slide 29: Automotive Components Business (Steering)
Automotive Components Business (Steering) 120 Demand Forecast by EPS Type Sales Growth 100 Million HPS 150 Index 80 １００ R-EPS 100 60 DP-EPS SP-EPS 40 C-EPS 50 20 0 0 Future Growth Strategies ● Build on strength of steering columns to expand business in column-type EPS and manual steering columns ✓ E
Slide 30: (Supplementary Information)
(Supplementary Information) 29
Slide 31: Forecast by Geographical Segment
(Supplementary Information) Forecast by Geographical Segment (Billions of yen) FY2014 FY2015 Increase/ Full year 1st half 2nd half Full year Decrease Change <Actual> <Actual> <Revised forecast> <Revised forecast> YOY YOY Net sales 974.9 489.7 490.3 980.0 +5.1 +0.5% Japan 522.7 248.3 245.2 493.5 -29.
Slide 32: Consolidated Balance Sheets
(Supplementary Information) Consolidated Balance Sheets Assets Liabilities and Net Assets (Billions of yen) (Billions of yen) Net assets Non-current liabilities Non-current assets Current assets Current liabilities Ratio of net worth to total capital Change from Change from 1,129.2 1,129.2 1,101.1 1
Slide 33: Capital Expenditure, Depreciation and Amortization, R&D Expenses
(Supplementary Information) Capital Expenditure, Depreciation and Amortization, R&D Expenses (Billions of yen) FY2014 FY2015 1st half FY2015 <Actual> <Actual> <Forecast> Capital expenditure (※) 46.9 19.9 51.0 ※Excluding intangible assets (Billions of yen) FY2014 FY2015 1st half FY2015 <Actual> <Actu