Horiba, Ltd. · TSE:6856

Horiba — Investor Presentation (February 2016)

58 slides from Horiba's investor presentation, February 2016

  1. Slide 1: HORIBA, Ltd. Financial Information

    HORIBA, Ltd. Financial Information February 2016 © 2016 HORIBA, Ltd. All rights reserved. 1

  2. Slide 2: Contents

    Contents  Review previous MLMAP [2011-2015] / 2015 Results  MLMAP2020 [2016-2020]  Business segment outline  Shareholder return MLMAP : Mid-Long Term Management Plan  Financial Data  Corporate profile [Disclaimer] Plans and forecasts in this presentation that do not constitute historical facts

  3. Slide 3: Contents

    Contents  Review previous MLMAP [2011-2015] / 2015 Results  MLMAP2020 [2016-2020]  Business segment outline  Shareholder return MLMAP : Mid-Long Term Management Plan  Financial Data  Corporate profile © 2016 HORIBA, Ltd. All rights reserved. 3

  4. Slide 4: 2015 full year results

    2015 full year results (Billions of yen) 2014 2015 MLMAP vs. vs. Results Results MLMAP2015 2015 2014 Sales 153.0 150.0 170.8 +17.8 +20.8 Operating profit 17.2 20.0 19.3 +2.1 -0.7 O.P. % 11.2% 13% or more 11.3% +0.1p - Ordinary profit 16.4 20.0 18.8 +2.3 -1.2 Net profit 10.5 12.0 12.8 +2.2 +0.8 Net p

  5. Slide 5: Results for 2015 by segment

    Results for 2015 by segment (Billions of yen) Sales Operating profit 2014 2015 2015 vs. vs. 2014 2015 2015 vs. vs. Resuts MLMAP Resuts 2014 MLMAP Resuts MLMAP Resuts 2014 MLMAP Auto 55.0 46.0 64.2 +9.2 +18.2 5.8 5.0 4.4 -1.3 -0.6 P&E 16.4 16.0 16.7 +0.2 +0.7 2.0 1.5 1.7 -0.2 +0.2 Medical 27.0 34.0 2

  6. Slide 6: Trend of 5 years results by segment

    Trend of 5 years results by segment (Billions of yen) Sales (2011 to 2015) 64.2 Mid-Long Term Management Plan target (Announced in Feb. 2011) 55.0 49.5 46.0 43.2 38.6 35.3 34.0 30.0 26.827.027.4 25.6 27.0 23.422.4 24.6 24.1 28.9 24.0 17.8 22.9 22.020.4 16.416.716.0 14.5 13.714.7 2012 2013 2014 2015

  7. Slide 7: Trend of 5 years results by segment

    Trend of 5 years results by segment (Billions of yen) Operating profit (2011 to 2015) 9.4 Mid-Long Term Management Plan target (Announced in Feb. 2011) 6.4 5.8 6.0 6.0 5.0 4.9 4.8 4.4 4.2 4.4 3.1 2.8 2.4 2.4 2.4 2.2 2.5 2.0 1.7 1.5 1.7 1.5 1.6 1.4 0.9 0.9 1.2 1.3 1.2 2012 2013 2014 2015 2011 2012 20

  8. Slide 8: 15-year business results

    15-year business results (Billions of yen) [Sales] Greatly exceeded the plan targets [O.P.] Close to the plan targets. Shortfall due to the large M&A and investment in PP&E in 2015 [N.P.] Achieved the plan targets (Renewed record-highs in sales and profits) Sales Operating profit Net profit 170.8 15

  9. Slide 9: Achievements of MLMAP2015

    Achievements of MLMAP2015  Fully implemented “One Company Matrix management”  Fully implemented shared services in five segments and regions  Fully implemented ERP (Enterprise Resource Planning) systems in all Achievements group companies.  Invested in highly profitable businesses  Invested in

  10. Slide 10: Contents

    Contents  Review previous MLMAP [2011-2015] / 2015 Results  MLMAP2020 [2016-2020]  Business segment outline  Shareholder return  Financial Data  Corporate profile © 2016 HORIBA, Ltd. All rights reserved. 10

  11. Slide 11: Major policies MLMAP2020 "One Step Ahead"

    Major policies MLMAP2020 “One Step Ahead” ●Applying HORIBA Technology in new business fields and new markets and becoming a true partner in analysis and measurement ●Accelerating corporate growth by its Super Dream Team based on balanced management, matrix organization, and HORIBA Stained Glass Proj

  12. Slide 12: Numerical targets

    Numerical targets Sales 250.0 billion yen Operating profit 30.0 billion yen (OP% :12%) Net profit 20.0 billion yen EPS 475 yen ROE 10% or more Total return 30% target Exchange rate : USD = 115 yen, Euro = 125 yen © 2016 HORIBA, Ltd. All rights reserved. 12

  13. Slide 13: Numerical targets (vs 2015, vs 2016)

    Numerical targets (vs 2015, vs 2016) (Billions of yen) 2015 2016 MLMAP2020 Results Growth ratio Growth ratio Forecast Plan vs. 2015 vs.2016 (Restated) Sales 172.3 175.0 250.0 +45% +43% Operating profit 20.2 17.5 30.0 +49% +71% OP% 11.7% 10.0% 12.0% +0.3p +2.0p Ordinary profit 19.8 16.5 29.0 +46% +76

  14. Slide 14: Numerical targets (by Segment)

    Numerical targets (by Segment) (Billions of yen) Sales Operating profit 2015 2016 MLMAP2020 Growth ratio Growth ratio 2015 2016 MLMAP2020 Growth ratio Growth ratio Results Forecast Plan vs 2015 vs 2016 Results Forecast Plan vs 2015 vs 2016 Auto 68.5 70.0 100.0 +46% +43% 5.2 5.0 10.0 +92% +100% P&E 1

  15. Slide 15: Business results in 20 years

    Business results in 20 years (Billions of yen) Continual growth in Sales and in all profits Doubled in 10 years from 2010 Sales Operating profit Net profit 250.0 30.0 172.3 175.0 153.0 144.2 138.1 20.2 134.2 116.0 16.5 118.5 123.4 117.6 17.2 17.5 105.6 104.5 14.9 13.7 92.4 12.2 20.0 74.4 78.5 85.0 1

  16. Slide 16: Major policies MLMAP2020 "One Step Ahead"

    Major policies MLMAP2020 “One Step Ahead” ●Applying HORIBA Technology in new business fields and new markets and becoming a true partner in analysis and measurement ●Accelerating corporate growth by its Super Dream Team based on balanced management, matrix organization, and HORIBA Stained Glass Proj

  17. Slide 17: Priority measure 1: Applying HORIBA technology in new business fields

    Priority measure 1: Applying HORIBA technology in new business fields and new markets Operating profit growth Automotive Test Systems 35.0 2015 vs. 2020  No.1 global share in exhaust gas (Billions of yen) analyzers 30.0  Expand production capacity and improve 30.0 profitability (Biwako Factory) 

  18. Slide 18: Priority measure 1: Becoming a true partner in analysis and measurement

    Priority measure 1: Becoming a true partner in analysis and measurement Integrally utilize in-house technological resources and the customer network of each business, HORIBA expand the own technology to growth market Growing market field Alternative fuel Water Bio-Life science Auto P&E Scientific Se

  19. Slide 19: Priority measures 2: Super Dream Team

    Priority measures 2: “Super Dream Team” Balanced management Matrix organization ・ Flexible utilization of management ・ Make thorough discussions by resources business segments and regions, ・ Select-and-focus business for and speedily implement strategy investment ・ Promote shared services* HORIBA St

  20. Slide 20: Contents

    Contents  Review previous MLMAP [2011-2015] / 2015 Results  MLMAP2020 [2016-2020]  Business segment outline  Shareholder return  Financial Data  Corporate profile © 2016 HORIBA, Ltd. All rights reserved. 20

  21. Slide 21: Auto Growth strategy

    Auto Growth strategy (Billions of yen) To be an Engineering Development Partner Grow in the analytical measurement field for automotive development Sub-segment sales • Growth opportunities from combustion engine development and 2016 MLMAP tightening of emission regulations (Forecast) 2020 • Improvin

  22. Slide 22: Auto Shared vision for HORIBA and HORIBA MIRA

    Auto Shared vision for HORIBA and HORIBA MIRA 強化目標 Create added value in EMS/MCT Utilize HORIBA’s advanced business measurement devices so as to benefit each business Develop next-generation mobility Grow in the global market / Expand the systems customer base Expanding business field in Next genera

  23. Slide 23: Auto Biwako factory HORIBA BIWAKO E-HARBOR

    Auto Biwako factory “HORIBA BIWAKO E-HARBOR”  Consolidating development, design, and production operations of gas measurement equipment at a single location  Doubling of production capability and shortening delivery time to one- third by using a new production methodology  Comprehensive engineeri

  24. Slide 24: Auto Business impact from next emission regulations

    Auto Business impact from next emission regulations Global convergence of emission regulations  Accelerating introduction of unified emission regulations (US and EU in 2017, Japan in 2018)  Need to upgrade equipment due to change in testing method  Bench test in labs  Need to upgrade exhaust gas

  25. Slide 25: Auto Expanding business field on Automotive industry

    Auto Expanding business field on Automotive industry Body design Power unit Driving management Material analysis Drivetrain Safety ECU/Semiconductor Alternative fuel Autonomous (Fuel cell etc.) Driverless car Cross segment approach Auto P&E Medical Semi Scientific © 2016 HORIBA, Ltd. All rights rese

  26. Slide 26: P&E Growth strategy

    P&E Growth strategy (Billions of yen) Value creation in environmental regulation and industrial process measurement fields  Expand business globally in environmental regulation fields  Utilize technology capability and knowhow accumulated in Japan  Expand share in the water measurement field by u

  27. Slide 27: P&E Regional strategy for gas measurement business

    P&E Regional strategy for gas measurement business Oil refining market in the north America for Chinese market Strengthening process New regulation for PM2.5 analytical measurement  Contribution to identify the business source of PM  Expanding the  Collaboration with Tsinghua business in Texas un

  28. Slide 28: Medical Growth strategy

    Medical Growth strategy (Billions of yen) Brand building and to be an IVD solution partner Globally expand in the middle/small hematology market (POCT) Improve and expand line-up of product models Strengthen permission and authorization, and relationship with academia Expand OEM business and col

  29. Slide 29: Medical Growth in Blood testing field

    Medical Growth in Blood testing field Clinical Test categoly Hematology Immunology Coagulation chemistry Market size 2 trillion yen 350 billion yen 2 trillion yen 200 billion yen Clinical Field in which HORIBA Large hospitals exhibits strength Testing centers chemistry Hospitals Small and medium-siz

  30. Slide 30: Medical Improving the business both side from Japan and France

    Medical Improving the business both side from Japan and France Challenge to expand the business in Asia. US, by comprehensive ability of Japan and France HORIBA ABX HORIBA, Ltd. • Medium/large-sized • Small size hematology • Strengthening sales of hematology analyzers analyzers hematology analyzers

  31. Slide 31: Semi Growth strategy

    Semi Growth strategy (Billions of yen) Becoming a solution partner in flow control of semiconductor production process  Strengthen market position in mass flow controllers and chemical concentration monitors  Enhance relationship with manufacturers of semiconductor devices and semiconductor produc

  32. Slide 32: Semi HORIBA's strength

    Semi HORIBA’s strength Global market share expansion in mass flow controllers その他 Global market share of mass flow controllers  Technology and production LEDimprovement, as required by semiconductor device and 太陽電池 production equipment manufacturers 60% 55% in 2015  Management organization with ca

  33. Slide 33: Scientific Growth strategy

    Scientific Growth strategy (Billions of yen) Becoming “Your Partner in Science”, and generating HORIBA’s core technology  Integrate technologies of HORIBA and HORIBA Jobin Yvon (HJY)  Enhance HORIBA’s core technology and make it available for other segments to expand their business  Enhance capab

  34. Slide 34: Scientific Approach for exploit new market

    Scientific Approach for exploit new market Japan/France/US/Canada Globalize through technology of 4sites •Optical analysis •Particle size distribution • HJY US facility technology of HJY and X ray analysis of • Fluorescence analysis of Photon Technology •Close relationship with HORIBA International

  35. Slide 35: Scientific Use of core technology for growth

    Scientific Use of core technology for growth Cutting-edge technology of HORIBA and HORIBA Jobin Yvon Close relationship with academia Next generation In-Line AFM- Nano Universities, Expanding to technology consosiamI On-Line Raman/CL governments censor new fields Strategic growth Auto P&E Bio-life s

  36. Slide 36: HORIBA's original management style: Strategic growth in Water measurement field

    HORIBA’s original management style + Strategic growth in Water measurement field © 2016 HORIBA, Ltd. All rights reserved. 36

  37. Slide 37: HORIBA's original management style

    HORIBA’s original management style Administrative Auto P&E Semi Scientific Medical HORIBA, Ltd. (Total Analytical measurement supplyer) HORIBA STEC (Flow control) Asia Shared services HORIBA Advanced Techno Japan (Water measurement) HORIBA Techno Service (After maintenance) Europe Shared services Am

  38. Slide 38: Water HORIBA Advanced Techno Ltd.

    Water HORIBA Advanced Techno Ltd. Apply HORIBA’s water measurement technology to raise productivity in water treatment processing Create the value only HORIBA can realize HORIBA Advanced Techno = Core player in water measurement  Cover all water treatment processes  Timely and precisely satisfy ma

  39. Slide 39: Contents

    Contents  Review previous MLMAP [2011-2015] / 2015 Results  MLMAP2020 [2016-2020]  Business segment outline  Shareholder return  Financial Data  Corporate profile © 2016 HORIBA, Ltd. All rights reserved. 39

  40. Slide 40: Shareholder return policy

    Shareholder return policy ● Dividend payment + Share buyback = 30% of Consolidated net profit to be targeted ● Remaining earnings are retained internally for strategic investment (i.e., facilities, M&A) Since 2013, HORIBA has changed the base amount of profit returns to shareholders from 30% of HORI

  41. Slide 41: Symbol of the previous MLMAP

    Symbol of the previous MLMAP “A yacht’s sails enable it to go forward regardless of the direction of the wind.” A yacht can sail toward harbor even with headwind. HORIBA is like such a yacht, sailing the seas with five sails (business segments) which efficiently coordinate with each other so that th

  42. Slide 42: Symbol of MLMAP2020

    Symbol of MLMAP2020 One Step Ahead - To create a next stage of HORIBA - Step out of the existing business fields and pursue further expansion. Take a new perspective and overcome technological/market/organization barriers. Be flexible, think outside the box, and move up to the next stage. © 2016 HOR

  43. Slide 43: © 2016 HORIBA, Ltd. All rights reserved.

    © 2016 HORIBA, Ltd. All rights reserved. 43 43

  44. Slide 44: Contents

    Contents  Review previous MLMAP [2011-2015] / 2015 Results  MLMAP2020 [2016-2020]  Business segment outline  Shareholder return  Financial Data  Corporate profile © 2016 HORIBA, Ltd. All rights reserved. 44

  45. Slide 45: Changed the accounting policy for revenue recognition

    Changed the accounting policy for revenue recognition 2014 2015 2016 Not installed Not installed (Original) Not arrived Not arrived Installed Installed (New) Delivered Delivered Changed points: Original Shipment base New The date of delivery or installation based on contractual arrangements Applied

  46. Slide 46: 2015 Operating profit analysis ( vs. 2014 )

    2015 Operating profit analysis ( vs. 2014 ) (Millions of yen) 2014 2015 Exchange Increase Increase impact Exchange impact for Increase of 19,372 17,214 of Sales of Cost of for Gross Expenses Increase of other Amount sales Profit R&D cost expenses +12,122 -9,907 +3,933 -1,136 -372 -2,482 Sales impact

  47. Slide 47: Capital Investment, Depreciation, R&D

    Capital Investment, Depreciation, R&D (Billions of yen) 2014 2015 2016 vs Results Results Forecast 2015 PP&E 9.1 14.9 16.3 +1.4 Intangibles 1.8 1.4 0.7 -0.7 Capital Investment 11.0 16.3 17.0 +0.6 Depreciation 4.9 6.1 7.0 +0.8 R&D 11.9 12.3 14.0 +1.6 (To net sales) 7.8% 7.2% 8.0% +0.8p 2016 ・PP&E Cap

  48. Slide 48: Consolidated Cash Flows

    Consolidated Cash Flows (Millions of yen) 2014 2015 Variation Cash flows from operating activities 11,455 14,770 3,315 Cash flows from investing activities -9,875 -30,642 -20,768 Cash flows from financing activities -273 12,843 13,117 Cash and cash equivalents at end of year 51,109 47,859 -3,251 Fre

  49. Slide 49: Cash Balance

    Cash Balance (Billions of yen) (Consolidated basis, each end of the year) Total Loan Balance 44.7 Bond 24.1 28.0 redemption in 2020 17.6 Cash * Cash * Bonds15.0 Cash * 51.1 47.8 49.2 Cash * Bonds15.0 Long16.8 38.8 Bonds15.0 Borrowed Bonds10.0 from JBIC Long2.2 Long2.1 Long2.5 15.1bil yen Short10.8 S

  50. Slide 50: Impact of fluctuation in foreign exchange

    Impact of fluctuation in foreign exchange Exchange rate impact (2015 Results) Exchange rate impact for 2016 Forecast (Millions of Yen) Sales Operating Profit 1 yen impact of Sales and O.P. Total USD Total USD (Yen depreciation) EUR EUR Sales Auto 1,021 1,529 -822 326 468 -43 USD 403 millions of yen

  51. Slide 51: Contents

    Contents  Review previous MLMAP [2011-2015] / 2015 Results  MLMAP2020 [2016-2020]  Business segment outline  Shareholder return  Financial Data  Corporate profile © 2016 HORIBA, Ltd. All rights reserved. 51

  52. Slide 52: Corporate Profile

    Corporate Profile Atsushi Horiba  Head office Kyoto, Japan President & CEO  Founded 1945  Incorporated 1953  CEO Atsushi Horiba  Fiscal year end December 31 - Corporate motto - To have interest and pride in our work to enjoy our lives © 2016 HORIBA, Ltd. All rights reserved. 52

  53. Slide 53: Business Segments

    Business Segments Automotive Test Systems Emission Measurement Systems (EMS) Mechatronics Devices (MCT) Driving Control Systems (ITS) Engineering Consultancy & Testing (ECT) Process & Environmental Environmental Systems Environmental Radiation Monitor Environmental Regulation & Process Business Medi

  54. Slide 54: Well Balanced Business Operation - Five Business Segments

    Well Balanced Business Operation -Five Business Segments- Business & Geographic Composition of Sales(2015) Sales 170.8 Billions of Yen P&E Scientific 27.016.4 Euro JPY (16%)(11%) EU Scientific Automotive 24% Japan 25.6 Semiconductor 64.2 31% (17%) 35.3 (37%) (21%) America Semi 19% Asia 28.9 Medical

  55. Slide 55: Global Market Share

    Global Market Share Automatic Blood Cell Counter Emission Measurement Systems Stack Gas Analyzers plus CRP 80% 20% 100% (Only in Japan) Mass Flow Controllers Raman Spectrophotometers Gratings 55% 30% 35% ※Market shares quoted are estimates by HORIBA. © 2016 HORIBA, Ltd. All rights reserved. 55

  56. Slide 56: HORIBA Worldwide

    HORIBA Worldwide Sales of FY2015: 170.8 BJPY The Number of Group Companies by region (As of December 31, 2015) America 9 Europe 23 Asia 17 (4 in Japan, including HORIBA, Ltd.) Total 49 © 2016 HORIBA, Ltd. All rights reserved. 56

  57. Slide 57: Employees by Region

    Employees by Region Other Americas 3% 従業員数 Total Number of Employees 2015年12月31日現在 Other Europe 2% USA 6,831 11% Total Asia: 3,545 Germany Japan 8% 52% 38% UK Total Europe: 2,356 10% 34% France Other Asia Total Americas: 930 14% 14% 14% © 2016 HORIBA, Ltd. All rights reserved. 57

  58. Slide 58: © 2016 HORIBA, Ltd. All rights reserved.

    © 2016 HORIBA, Ltd. All rights reserved. 58

HORIBA — Investor Presentation (February 2016) on 6ix