Unicharm Corporation · TSE:8113
Unicharm — FY2014 Earnings Presentation
46 slides from Unicharm's earnings presentation, Feb 12, 2015
Slide 1: Unicharm Presentation Materials for Investor Meeting
Fiscal Year Ended December 31, 2014 Unicharm Presentation Materials for Investor Meeting February 12, 2015 Takahisa Takahara President and CEO Unicharm Corporation Projections stated herein include those based on the Company’s assumptions, forecasts and plans as of February 12, 2015. Therefore, actu
Slide 2: To 10% of Global Market Share
To 10% of Global Market share Market share 2014 （compared to 2011） World No.3 9.2% (+1.1%) Asia No.1 25.2% (+1.4%) Accelerate growth utilizing strength of No.1 position in Asia Copyright Copyright (c) (c) Unicharm Corporation. 2012 Unicharm All rights Corporation. reserved. All rights reserved. 2
Slide 3: Winning high share in each category
Winning high share in each category Baby Care 2014 (compared to 2011) World No.3 9.1% (+0.9%) Asia No.1 25.2% (+0.7%) Feminine Care 2014 (compared to 2011) World No.3 8.9% (+1.4%) Asia No.1 21.6% (+1.9%) Health Care 2014 (compared to 2011) World No.3 10.4% (+1.4%) Asia No.1 34.8% (+1.5%) Copyright C
Slide 4: Moony Series wins Best Mother Award
Moony Series wins Best Mother Award!! Highly rated by 14,000 Japanese mothers! Copyright Copyright (c) (c) Unicharm Corporation. 2012 Unicharm All rights Corporation. reserved. All rights reserved. 4
Slide 5: Financial Performance Summary: Fiscal Year Ended December 31, 2014
Financial Performance Summary: Fiscal Year Ended December 31, 2014 Copyright (c) Unicharm 2012 Unicharm Corporation. Corporation. All rights All rights reserved. reserved.
Slide 6: Change closing date of fiscal year from March 31 to December 31
Change closing date of fiscal year from March 31 to December 31 to standardize the fiscal year for all consolidated subsidiaries ①Consolidated FY Ended December 31, 2014. (Afterward: “Financial report basis”) ◆Companies with fiscal year ending March: Apr-Dec 2014 ◆Companies with fiscal year ending D
Slide 7: Consolidated Year-on-Year Comparison (Financial report basis)
【Consolidated】 Year-on-Year Comparison (Financial report basis) (Millions of yen) FY Ended FY Ended Difference Difference※ Dec. 31, 2014 Mar. 31, 2014 (%)※ Net sales 553,661 599,455 ー ー Operating income 61,347 67,240 ー ー Operating income margin 11.1% 11.2% Ordinary income 65,527 67,913 ー ー Ordinary
Slide 8: Actual operating income margin reached 11.6% excluding special factors
Actual operating income margin reached 11.6% excluding special factors Year-on-Year Comparison (Financial report basis) (Millions of yen) FY Ended FY Ended Difference Difference Dec. 31, 2014 Mar. 31, 2014 (%) Net sales 553,661 599,455 ー ー Operating income 61,347 67,240 ー ー Operating income margin
Slide 9: Segment Information (Financial report basis)
Segment Information (Financial report basis) Business Segment Information (Financial report basis) (Millions of yen) Personal Elimination/ Pet Care Others Total Companywide Consolidated Care FY Ended Mar. 31, 2014 Net sales 515,253 78,672 5,530 599,455 － 599,455 Operating income 65,732 1,130 355 6
Slide 10: Overseas sales composition reached 64.4%
Overseas sales composition reached 64.4% driven by steady increasing sales composition in Asia (Adjusted basis 60.5%) Changes in Japan and Overseas Net Sales (Financial report basis) 900 (Billions of yen) 64.4% 70% 800 57.7% 60% 700 52.6% 49.3% 46.9% 600 50% 42.4% 42.8% 500 36.9% 37.1% 38.5% 38.2%
Slide 11: Actual operating income margin by geographical segment
Executed aggressive marketing investments focused on Asia Actual consolidated operating income margin reached 11.6% excluding special factors of changing fiscal year, etc. Actual operating income margin by geographical segment (After considering special factors) 20.0% 15.5% 15.1% 14.0% 13.6% 13.8%
Slide 12: Financial Results Review: Fiscal Year Ended December 31, 2014
Financial Results Review: Fiscal Year Ended December 31, 2014 Copyright (c) Unicharm 2012 Unicharm Corporation. Corporation. All rights All rights reserved. reserved.
Slide 13: Double-digit growth in both net sales and operating income
Double-digit growth in both net sales and operating income Year-on-Year Comparison (Adjusted basis※ ’14/1 – ’14/12 vs ’13/1 – ’13/12) (Millions of yen) FY Ended FY Ended Difference Dec. 31, 2014 Dec. 31, 2013 Difference Note (%) (Adjusted basis) (Adjusted basis) Net sales 666,258 580,400 85,857 14
Slide 14: Business Segment Information (Adjusted basis)
Pet care business expand Japan sales of high unit price products, while last year’s restructuring sees results improve overseas Business Segment Information (Adjusted basis ’14/1 – ’14/12 vs ’13/1 – ’13/12) (Millions of yen) Personal Elimination/ Pet Care Others Total Consolidated Care Companywide
Slide 15: Geographical Segment Information (Adjusted basis)
Operating income improves with continual high added-value proposals focused on the baby care business in Japan Geographical Segment Information (Adjusted basis ’14/1-’14/12 vs ’13/1-’13/12) (Millions of yen) Elimination/ Japan Asia Others Total Consolidated Companywide FY Ended Dec. 31, 2013 Net s
Slide 16: Impact on sales and operating income due to exchange fluctuation
Impact on sales and operating income due to exchange fluctuation (Adjusted basis) Net sales increased approx. ¥18.0 billion year-on-year, while operating income decreased approx. ¥3.0 billion Exchange rate for Exchange rate for Currency Change in rate FY2014 FY2013 Taiwan (TWD) 3.50 3.29 +6.4% Thail
Slide 17: Financial Results Forecasts for Fiscal Year Ending December 31, 2015
Financial Results Forecasts for Fiscal Year Ending December 31, 2015 Copyright (c) Unicharm 2012 Unicharm Corporation. Corporation. All rights All rights reserved. reserved.
Slide 18: Double digit growth in sales and profit expected for 2015
Double digit growth in sales and profit and expect actual record-high results in the fiscal year ending December 31, 2015 (Millions of yen) Fiscal year ended Fiscal year ending Difference Dec. 31, 2014 Difference Dec. 31, 2015 (%) Adjusted basis Net sales 760,000 666,258 93,742 14.1% Operating incom
Slide 19: Foreign exchange rate sensitivity to yen depreciation
Foreign exchange rate sensitivity to 1% depreciation of the yen vis-à-vis local currencies increases net sales and operating income approx. ¥5 billion and ¥500 million, respectively Impact of a 1% change (depreciation of yen) Assumed rate for FY (Millions of yen) Currency ending Dec 31, 2015 Net sal
Slide 20: Overview: Corporate Strategy
Overview: Corporate Strategy (Information and data noted here is from Unicharm) Copyright (c) Unicharm 2012 Unicharm Corporation. Corporation. All rights All rights reserved. reserved.
Slide 21: Low usage ratio of disposable diapers and sanitary products in Asia
In Asia, low usage ratio of disposable diapers and sanitary products and faster progression of population aging than in Japan Number of births and usage ratio of Population of menstruating females Number of elderly persons disposable diapers and usage ratio of sanitary products (aged 65 years and ab
Slide 22: Promoting LMU (Local Management Units)
Focus on changes in the environment by closely following the situation on site and build an organizational structure for the speedier implementation of strategies Promoting LMU (Local Management Units) Strengthening the structure for facilitating local production for local consumption Aggressi
Slide 23: Japan Baby Care: strengthen brand power with new value proposals
Strengthen brand power with continual new value proposals Substantially improve profitability by Japan responding to changes in the environment Baby Care (BC) New proposals for low-birth-weight infants Launch as hospital-use products Extremely low-birth- Very low-birth-weight Low-birth-weight infa
Slide 24: Japan Health Care: new segment around light incontinence market
Create a new segment centering on light incontinence market, and help realize Japan a society of good health and long life Health Care (HC) ■ Retail market ■Male light incontinence market 60 Market scale 2.9X 50 40 Share 30 No.1 53.6% 1.0X 20 Competitor A 14.2% 10 Competitor B 9.5% 0 2012/12 2013/
Slide 25: Japan Pet Care: No.1 share in all market entry categories
No.1 share in all market Japan entry categories Pet Care (PC) PC market Food market Toiletry market Share Share Share No.1 21.4% No.1 16.1% No.1 42.0% 25 40 20 15 Competitor A 15.7% 30 15 Competitor A 12.5% 10 20 10 Competitor B 9.5% Competitor B 7.5% Competitor A Competitor C 8.3% 14.2% 5 Com
Slide 26: Japan Pet Care: raise market unit price and cultivate new markets
Promote best practices and raise the market unit price Japan Cultivate new markets for revitalization Food market Toiletry market Kg unit (sales price) over previous Actively cultivate new markets (%) fiscal year (tax excluded) 110 ＜ October 2014 105 ＜ 107 112 Launch of manner wear 106 Octob
Slide 27: Taiwan Health Care: cultivate markets in aging population
Cultivate markets through actively Taiwan raising awareness in communities with aging population Health Care (HC) Retail market ■Horizontal roll-out of Japanese-style care model 55 Explaining the features and usage of a 45 Share Japanese-style care model by professional 35 No.1 55.8% care adviso
Slide 28: China Baby Care: growth in high value-added products
Growth in high value-added products in urban markets China Expansion of EC and specialty stores in sales channels Baby Care (BC) ■ By market category, change in proportion Expanding proportion of high unit price, high value-added products as urban 1 ﾊﾟﾝﾂ Pants markets grow 8 14 11 輸入品 Imported pro
Slide 29: China Baby Care: focus on EC channels
Develop products that meet market needs, and lead the market by focusing on China EC channels Baby Care (BC) ■Change in import volume ■ Change in net sales Market growth UC Sales growth of Japanese products of pants-type diapers (Local currency base) (Local currency base) (Local currency base) (
Slide 30: China Feminine Care: premium marketing in regional cities
Implement premium marketing also in regional towns and cities China Increase market share by raising brand recognition Feminine Care (FC) All market share Shanghai City share No.2 17.0% 40 No.1 37.1% 25 Competitor A 24.6% 30 20 Competitor B 20.6% 15 10 Competitor A 10.5% Competitor B 11.3% 5 0 2
Slide 31: Indonesia Baby Care: continue high growth
Continue high growth and strengthen regional supply to become even Indonesia more dominant in the market Baby Care (BC) Past 10 years Changes in net sales All market share 30.1X No.1 66.1% (Local currency base) 50 Competitor A 16.3% CAGR 46% Competitor B 8.2% 0 2012/12 2013/12 2014/12 Regional
Slide 32: Indonesia Feminine Care and Health Care
High value-added products bring FC share close to 40% HC share expanding as pants-type diaper Indonesia usage increases Feminine Care (FC) Health Care (HC) Share Share No.1 38.8% No.3→ No.1 8.4%→ (2012/12) 35.4% (2014/11) 75 35 Competitor A 35.7% 50 25 25 Competitor A 15 77.7% → 26.1% Competitor B 1
Slide 33: India: record-high share in All India
Achieved record-high share in All India Continue high growth and India aim for surplus from 2016 Baby Care (BC) All India share ■Net売上 sales 営業利益 Operating income (Local currency base) Share No.2 26.6% 60 Competitor A 54.1% CAGR 74% 50 40 30 20 Competitor B 16.4% 0 10 2012/12 2013/12 2014/12 2012
Slide 34: India: top share in Delhi with pants-type diapers
Achieved top share in Delhi by initiating India the use of baby pants-type diapers Baby Care (BC) Delhi City Changes in proportion of share and pants-type diaper usage Share Progression of pants-type diaper usage strategy No.1 50.1% 1-diaper pack Proportion of Price-setting reflecting economic
Slide 35: India: second factory in Southern India
Pursuing further expansion by strengthening supply system with the construction of a India second factory in Southern India Neemrana City Plant No.1 Sri City Plant No.2 Scheduled for 2015 H1 Operation Copyright Copyright (c) (c) Unicharm Corporation. 2012 Unicharm All rights Corporation. reser
Slide 36: Thailand Baby Care and Feminine Care
BC meets markets needs and enjoys steady growth FC achieves 50% market share Thailand with high added value Baby Care (BC) Feminine Care (FC) Share Share No.1 58.3% No.1 50.6% 60 45 Competitor A 36.5% 40 Competitor A 30.1% 25 20 Competitor B 6.5% Competitor B 10.4% 0 5 2012/12 2013/12 2014/12 2012/1
Slide 37: Vietnam Baby Care and Feminine Care
BC expanding through active promotion of baby pants-type diaper usage FC almost reaches No.1 from strengthening of Vietnam high value-added products Baby Care (BC) Feminine Care (FC) Share Share No.1 40.8% No.2 43.2% 50 Competitor A 44.9% 40 Competitor A 34.4% 40 30 20 Competitor B 18.0% 10 20 2012/
Slide 38: Myanmar Baby Care and Feminine Care
BC continues expansion and remains undisputed No.1 FC to enjoy further growth backed by Myanmar formidable brand power Baby care (BC) Feminine care (FC) Share Share No.1 64% No.1 54% Competitor A 10.0% Competitor A 7.0% Competitor B 10.0% Competitor B 7.0% Competitor C 8.0% Competitor C 5.0% Copyrig
Slide 39: Saudi Arabia: steady growth in new segments
Steady growth amid uncertain conditions Expanding market share even in Saudi Arabia new segments Change in net sales Overall business Baby Care (BC) (Local currency base) 2.50X (Local currency base) 2.60X 1.0X Domestic share No.2 30%↑ CAGR 16% 2008 2009 2010 2011 2012 2013 2014 Increase in impor
Slide 40: U.S.: raising profitability by improving portfolio
Raising profitability by improving our portfolio U.S. Renewed Dog Pad secures No.1 share Focus on growth segments (Changes in proportion of net sales) 2010 (before acquisition) 2014 1. Snacks 31% 1. Flea and tick controls 29% 2. Flea and tick controls 30% 2. Dog Pads 16% 3. Toys 12% 3. Snacks
Slide 41: G20 plan targets: ¥1.6 trillion net sales in 2020
Three 15% G20 plan targets: ¥1.6 trillion in consolidated net sales in 2020 Growth potential Profitability Capital efficiency rate Sales growth rate Operating income margin ROE 15% Operating income, 15% 15% Net sales, Sales growth rate ROE Operating income ratio Sales ●：Annualized real Operating Ope
Slide 42: Adhering to global investment standards: JPX Nikkei 400
Raising corporate value, achieving sustainable growth, creating investment appeal Adhering to corporate management in line with global investment standards JPX Nikkei 400 (Standard of the JPX Nikkei 400) 3 selection standards “Company with a high appeal for investors,” meeting requirements of global
Slide 43: Shareholder Return Policy
Shareholder Return Policy Copyright (c) Unicharm 2012 Unicharm Corporation. Corporation. All rights All rights reserved. reserved.
Slide 44: Steady and continual dividend payments
Steady and continual dividend payments On track for 14 consecutive periods of increased dividends! Change in dividends (Yen) ¥2.07 increase in dividends 16.0 14.8 14.0 ※ 12.7 12.73 12.0 11.3 10.7 10.0 9.3 7.7 8.0 6.0 6.0 4.9 5.1 4.0 3.0 3.3 3.7 2.3 2.7 2.0 0.0 '02/3 '03/3 '04/3 '05/3 '06/3 '07/3 '
Slide 45: Total shareholders' return forecast of 50%
We will continue to pay dividends that are consistent with earnings and increase dividends in fiscal year ending Dec. 2015 through the share buy-back, and forecast a 50% total shareholders’ return (Millions of yen) ※ ※ Fiscal year ended Dec. 31, 2014 is an irregular fiscal year lasting nine months.
Slide 46: Copyright Corporation. All rights
Copyright Copyright (c) (c) Unicharm Corporation. 2012 Unicharm All rights Corporation. reserved. All rights reserved. 45