Slide 1: Financial Results Highlights FY12/2022
Financial Results Highlights FY12/2022 February 13, 2023 Roland Corporation TSE Prime : 7944 JC-120 JAZZ CHORUS Roland 50th Anniversary Limited Edition
Slide 2: Note: Changes in the accounting standard
<Note: Changes in the accounting standard> • Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, revised on March 31, 2020, effective from April 1, 2021) is newly applied to our sales and operating profit from FY2022 • Accordingly, YoY changes for FY2022 (new standard) vs. FY2021 (ol
Slide 3: Executive Summary
Executive Summary ⚫ FY12/2022 ・Agile Response to Unexpected Environmental Changes in Europe and China ・Sales and Profits Increased YOY excluding the Accounting Change Impact ・Drum Workshop (DW) is Consolidated from Q4 ⚫ FY12/2023 Forecast ・Plan to Increase Sales and Profits YOY from the Previous Yea
Slide 4: FY12/2022 Results / FY12/2023 Forecast / Shareholder return
1 FY12/2022 Results 2 FY12/2023 Forecast 3 Shareholder return 4 Supplemental Information 4
Slide 5: FY12/2022 Results
1 FY12/2022 Results 2 FY12/2023 Forecast 3 Shareholder return 4 Supplemental Information 5
Slide 6: FY12/2022 Financial Results Highlight
FY12/2022 Financial Results Highlight Sales • Continued strong performance in North America, the largest market 95.8bn • Lockdown impact in China (YoY1：+20.9%) • The consolidation of Drum Workshop (from Q4) was add-on Operating Profit • Increased YOY excluding the accounting standard changes 10.7bn
Slide 7: Consolidated Financial Results
FY12/2022 Financial Results Consolidated Financial Results ⚫ GP margin recovered to almost the same level as last year based on the substantial YOY comparison4 ⚫ Started consolidation of DW from Q4 FY12/20211 FY12/20222 New Standard Old standard (same as previous year) (JPY mn) Actual % of Sales Act
Slide 8: Sales by Category
FY12/2022 Financial Results Sales by Category FY12/2021 FY12/2022 JPY mn % of % of Actual Sales Actual Sales YoY1 YoY2 Comments Overall demand for e-pianos was at a higher level than before Covid-19. Keyboards 24,792 31.0% 29,869 31.2% +21.6% +8.6% Demand for low-priced pianos softened, but the deve
Slide 9: Sales by Region
FY12/2022 Financial Results Sales by Region FY12/2021 FY12/2022 JPY mn % of % of Actual Sales Actual Sales YoY1 YoY2 Comments Supply of mainstay e-piano recovered. Demand was generally firm, but some store Japan 9,666 12.1% 9,736 10.2% +0.7% +0.2% sales were affected in July-September due to an incr
Slide 10: Consolidated Operating Profit
FY12/2022 Financial Results Consolidated Operating Profit Changes (vs Previous year) Factors (JPY bn) Sales Volume change Selling Price / Cost ratio change • Sales Volume SG&A change ✓ China Lockdown FX impact ✓ Slower demand in Europe Accounting Change DW consolidation (Q4) • Selling price / Cost r
Slide 11: Topics: Hot New Products ①
FY12/2022 Financial Results Topics: Hot New Products ① SPD-SX PRO F107 VAD507, VAD504, VAD307 ⚫ Top-of-the-line model of sampling ⚫ This affordable digital piano offers the ⚫ The latest model in the "VAD series" pads for drummers to meet the high same sound source, keyboard, and that combines the au
Slide 12: Topics: Hot New Products ②
FY12/2022 Financial Results Topics: Hot New Products ② GX-100 FANTOM-0 Series AIRA Compact Series ⚫ BOSS brand guitar/bass multi- ⚫ Three lightweight, portable models with ⚫ A new concept of small electronic effects pedals with high-quality the sound, applications, and operability of musical instrum
Slide 13: FY12/2023 Forecast
1 FY12/2022 Results 2 FY12/2023 Forecast 3 Shareholder return 4 Supplemental Information 13
Slide 14: Huge TAM in the Musical Instruments market
FY12/2023 Full-Year Forecast Economic uncertainty remains, but there is a Huge TAM in the Musical Instruments (MI) market ③Indifferent to MI ~20%1 ②Interested in MI (Inexperience, leaving) ~70%1 TAM in the MI market ①Active in MI ~10%1 1 Estimated by the Company based on various surveys 14
Slide 15: Roland can Grow even in a Recession
FY12/2023 Full-Year Forecast Roland can Grow even in a Recession ⚫ Assumptions in a recessionary phase (Professional / discerning hobbyists) ①Our Business Domain ⚫ Limited impact, especially in areas of strength. Customer Type ・Continued introduction of high value-added Areas of strength products an
Slide 16: Uncertainty remains in the short term, normalization expected in H2
FY12/2023 Full-Year Forecast Uncertainty remains in the short term, but Normalization expected in H2 of the year and Beyond ＜Assumptions for Earnings Forecasts＞ 1st Half 2nd Half ⚫ New Lifestyles ⚫ New Lifestyles Environment ⚫ Uncertainty in global ⚫ Europe and China to be Opportunity economy Recove
Slide 17: FY12/2023 Forecast Highlights
FY12/2023 Full-Year Forecast Highlights Sales • Contribution of Drum Workshop (YoY 9 months add on / Q1-Q3) 105.6bn • Recovery in China & Europe, Continued growth in North America & Asia (YoY +10.2%) • Expect YOY sales growth in Major products and Major regions Operating Profit • Effects of Price Op
Slide 18: Consolidated Financial Forecast
FY12/2023 Full-Year Forecast Consolidated Financial Forecast ⚫ Including effect of new consolidation of DW (YoY 9 months add on: Q1-Q3) ⚫ Sales +4.3% YoY, Operating Profit +22.8% YoY, excluding the DW consolidation and FX impact FY12/20221 FY12/20232 (JPY mn) Actual % of Sales Forecast % of Sales Yo
Slide 19: Sales by Category Forecast
FY12/2023 Full-Year Forecast Sales by Category ⚫ Expand market share and create new markets through continuous launch of new products ⚫ Percussion & Wind Instruments increases significantly due to consolidated DW (Q1-Q3) FY12/2022 FY12/2023 JPY mn Actual % of Sales Forecast % of Sales YoY YoY1 Keybo
Slide 20: Sales by Region Forecast
FY12/2023 Full-Year Forecast Sales by Region ⚫ Newly consolidated DW(Q1-Q3) will contribute to revenue growth, especially in North America ⚫ Continued growth in North America, Japan, and other regions, plus expected recovery in Europe and China FY12/2022 FY12/2023 JPY mn Actual % of Sales Forecast %
Slide 21: Full year sales and profits expected to increase
FY12/2023 Full-Year Forecast Full year Sales and Profits are expected to increase from the previous year (See Supplementary Materials for details of 1H and 2H PL) 1st Half 2nd Half Full-Year Increase in Sales and Increase in Increase in Decrease in Profit Sales and Profit Sales and Profit Sales 48.8
Slide 22: Consolidated Operating Profit Forecast
FY12/2023 Full-Year Forecast Consolidated Operating Profit Changes (vs Previous year) Factors Sales Volume change (JPY bn) • Sales Volume Selling Price / Cost ratio change ✓ Volume decline in 1H due to market inventory SG&A change adjustment FX impact DW consolidation (Q4) 9 months ✓ Increase in ful
Slide 23: Shareholder Return
1 FY12/2022 Results 2 FY12/2023 Forecast 3 Shareholder Return 4 Supplemental Information 23
Slide 24: Plan dividend increase in line with the basic policy
Shareholder Return Plan dividend increase in line with the basic policy ＜Policy＞ The Company’s shareholder return policy is to make sustainable and stable dividend payments while flexibly purchasing treasury shares taking into account various factors, including stock market trends and capital effici
Slide 25: Supplemental Information
1 FY12/2022 Results 2 FY12/2023 Forecast 3 Shareholder return 4 Supplemental Information 25
Slide 26: SCM moves toward normalization
Supplemental Information SCM moves toward normalization after a period of turmoil ⚫ Order backlog generally in normalized range due to recovery in supply ⚫ Both product inventories and raw material inventories decreased from Q3/2022 Order backlog transition Finished goods1 Raw Materials1,2 (JPY mn)
Slide 27: Update on Roland Cloud
Supplemental Information Update on Roland Cloud Number of users and sales Major initiatives conducted in 2022 ⚫ Continued growth in both subscribers and sales ⚫ Continuous release of Software/Apps ✓ 3 soft synthesizers, 92 additional voices 1,000 30,000 ✓ Synth/Drums Release of collaborative content
Slide 28: First Half Forecast
Supplemental Information First Half Forecast ⚫ Including effect of new consolidation of DW (6 months: Q1-Q2) ⚫ Sales -0.3% YoY, Operating Profit -8.6% YoY, excluding the DW consolidation and FX impact FY12/2022 First Half1 FY12/2023 First Half2 (JPY mn) Actual % of Sales Forecast % of Sales YoY Sale
Slide 29: Second Half Forecast
Supplemental Information Second Half Forecast ⚫ Including effect of new consolidation of DW (3months: Q3) ⚫ Sales +8.0% YoY, Operating Profit +46.9% YoY, excluding the DW consolidation and FX impact FY12/2022 Second Half1 FY12/2023 Second Half2 (JPY mn) Actual % of Sales Forecast % of Sales YoY Sale
Slide 30: Our Sustainability ①
Supplemental Information Our Sustainability ① <Major Initiatives in 2022> Started supervision by management Greenhouse Gas Emissions Survey ⚫ Established the Sustainability Promotion ⚫ Survey of greenhouse gas emissions from all Committee within the Executive Board to business activities promote act
Slide 31: Our Sustainability ②
Supplemental Information Our Sustainability ② <Major Initiatives in 2022> Education & Artist support Promotion of childcare support ⚫ Donation to schools which support the independence ⚫ “Kurumin” certification from the Minister of of children who are not attending school Health, Labor and Welfare a
Slide 32: R&D Expenses / Capital Expenditures / Depreciation
Supplemental Information R&D Expenses／Capital Expenditures・Depreciation R&D Expenses Capital Expenditures Depreciation (JPY mn) (JPY mn) (JPY mn) 10,000 Increase due to newly 4,500 4,500 consolidated DW, Temporary impact from 9,000 development costs of sound renewal of existing lease Increase due to
Slide 33: Key Consolidated Financials (PL)
Supplemental information Key Consolidated Financials（PL） (JPY mn) 12/2018 12/2019 12/2020 12/2021 12/2022 Net sales 61,153 63,247 64,044 80,032 95,840 Cost of sales 31,536 33,006 33,664 43,895 56,484 Gross profit 29,617 30,240 30,379 36,137 39,356 Selling, general and administrative expenses 23,762
Slide 34: Key Consolidated Financials (B/S)
Supplemental information Key Consolidated Financials (B/S) (JPY mn) 12/2018 12/2019 12/2020 12/2021 12/2022 Cash and deposits 9,052 8,815 10,832 8,781 10,506 Notes and accounts receivable - trade 8,065 8,913 5,930 7,444 12,905 Inventories 13,142 14,215 18,075 25,240 32,322 Other current assets 1,918
Slide 35: Key Consolidated Financials (CF)
Supplemental information Key Consolidated Financials (CF) (JPY mn) 12/2018 12/2019 12/2020 12/2021 12/2022 Profit before income taxes 4,392 4,080 5,846 10,239 10,529 Depreciation 1,078 1,537 1,568 1,608 1,981 Amortization of goodwill 59 4 4 4 94 Decrease (increase) in trade receivables (677) (846) 2
Slide 36: Key Consolidated Financials (Sales by product / region)
Supplemental information Key Consolidated Financials (Sales by product / region) Product (JPY mn) 12/2018 12/2019 12/2020 12/2021 12/2022 Keyboards 15,551 17,104 17,842 24,792 29,869 Percussion & Wind 14,351 14,205 14,620 19,053 23,046 Instruments Guitar-related Products 16,411 16,744 16,712 19,093
Slide 37: Forward-looking statements
This material contains information that constitutes “forward-looking statements” of Roland Corporation. Statements other than those related to past or present facts are all statements that constitute forward-looking statements. Such forward-looking statements are based on our assumptions and decisio