Kureha Corporation · TSE:4023
Kureha — H1 FY2022 Earnings Presentation
33 slides from Kureha's earnings presentation, Nov 9, 2022
Slide 1: FY2022 Interim Report
FY2022 Interim Report November 9, 2022
Slide 2: Contents
1 Contents Summary 2 III. Appendix • PVDF business 27 I. FY2022 Half-Year Results • PGA business 28 • 1Q-2Q FY22 Financial summary • Returning to shareholders 29 4-6 • Segment performance • Consolidated companies 30-31 7-11 • Cash flow 12 • Financial position 13 II. FY2022 Full-Year Outlook • FY22 F
Slide 3: Summary
2 Summary FY2022 Overview Revenue and profit growth continues, absorbing impact of inflation and higher expenses ✓ Delivered half-year operating profit of ¥16.7bn, a 47% increase from a year ago, 29% above most recent forecast ✓ Full-year operating profit expected to reach ¥27.0bn (up 34% YoY; up 23
Slide 4: I. FY2022 Half-Year (2Q) Results
3 I. FY2022 Half-Year (2Q) Results (April 1, 2022 through September 30, 2022)
Slide 5: 1Q-2Q FY2022 Financial Summary (1)
4 1Q-2Q FY2022 Financial Summary (1) (in billions of yen) Changes Vs. 1Q-2Q FY21 Most Changes 1Q-2Q 1Q-2Q vs. • Revenue increased with sales recent vs. FY21 FY22 1Q-2Q expansion of advanced plastics, Forecast* Forecast FY21 particularly PVDF used as a binder Revenue 79.1 101.8 22.7 100.0 1.8 (+28.7%
Slide 6: 1Q-2Q FY2022 Financial Summary (2)
5 1Q-2Q FY2022 Financial Summary (2) Revenue & Operating Profit by Segment (vs. 1Q-2Q FY21) (in billions of yen) 1Q-2Q FY21 1Q-2Q FY21 Revenue Operating profit 1Q-2Q FY22 1Q-2Q FY22 47.3 9.0 28.8 5.1 22.9 23.8 4.3 17.5 12.8 2.6 1.8 9.0 8.9 1.6 1.4 5.5 4.2 1.2 0.4 0.3 Advanced 機能製品 Specialty 樹脂製品 Con
Slide 7: 1Q-2Q FY2022 Financial Summary (3)
6 1Q-2Q FY2022 Financial Summary (3) Revenue & Operating Profit by Segment (vs. Most recent forecast) (in billions of yen) Revenue Operating profit 47.0 47.3 1Q-2Q FY22 Forecast 9.0 1Q-2Q FY22 Forecast 1Q-2Q FY22 Results 1Q-2Q FY22 Results 7.5 23.5 23.8 4.3 16.5 17.5 3.7 8.5 8.9 4.5 4.2 0.8 1.6 1.11
Slide 8: Segment Performance: Advanced Materials
7 Segment Performance: Advanced Materials (in billions of yen) Vs. 1Q-2Q FY21 1Q-2Q 1Q-2Q Change FY21 FY22 % Revenue ➚ Operating profit ➚ Advanced Materials Advanced plastics revenue and profit up: Advanced plastics 19.4 36.5 +88% Sales expansion for PVDF (LiB binder), PPS and PGA; PVDF primarily dr
Slide 9: Segment Performance: Specialty Chemicals
8 Segment Performance: Specialty Chemicals (in billions of yen) Vs. 1Q-2Q FY21 1Q-2Q 1Q-2Q Change FY21 FY22 % Revenue ➚ Operating profit ➚ Specialty Chemicals Agrochemicals & Pharmaceuticals revenue and Agrochemicals 3.3 6.6 +101% profit up: Higher agrochemicals volumes partially offset by Pharmaceu
Slide 10: Segment Performance: Specialty Plastics
9 Segment Performance: Specialty Plastics (in billions of yen) Vs. 1Q-2Q FY21 1Q-2Q 1Q-2Q Change FY21 FY22 % Revenue ➚ Operating profit ➘ Specialty Plastics Home products & Fishing lines revenue and profit Home products 12.1 11.8 -3% down: Slower food wrap film sales and higher fuel and Fishing line
Slide 11: Segment Performance: Construction
10 Segment Performance: Construction (in billions of yen) Vs. 1Q-2Q FY21 1Q-2Q 1Q-2Q Change FY21 FY22 % Revenue ➘ Operating profit ➘ Construction Construction revenue and profit down: Construction 9.0 8.6 -4% Fewer private construction projects; public construction remained at prior-year level Elimi
Slide 12: Segment Performance: Other Operations
11 Segment Performance: Other Operations (in billions of yen) Vs. 1Q-2Q FY21 1Q-2Q 1Q-2Q Change FY21 FY22 % Revenue ➘ Operating profit ➘ Other Operations Environmental engineering revenue and profit down Environmental Fewer industrial waste treatment volumes, including engineering 6.6 6.3 -5% low-le
Slide 13: Cash Flow
12 Cash Flow (in billions of yen) 1Q-2Q 1Q-2Q Change FY21 FY22 Profit before income tax 11.5 17.4 5.9 Depreciation 5.8 5.7 -0.1 Other -3.8 -14.4 -10.6 Cash flow from operating activities 13.5 8.7 -4.9 Cash flow from investing activities* -4.8 -4.9 -0.1 Free cash flow 8.7 3.8 -4.9 Cash flow from fina
Slide 14: Financial Position
13 Financial Position (in billions of yen) Assets Liabilities and Equity Mar. 31 Sept. 30 Mar. 31 Sept. 30 Change Change 2022 2022 2022 2022 Cash and cash equivalents 30.6 29.1 -1.5 Trade and other payables 29.5 29.2 -0.3 Trade and other receivables 35.8 41.5 5.7 Interest-bearing debt 28.5 26.4 -2.1
Slide 15: II. FY2022 Full-Year Outlook
14 II. FY2022 Full-Year Outlook (April 1, 2022 through March 31, 2023)
Slide 16: FY22 Financial Forecast (1)
15 FY22 Financial Forecast (1) (in billions of yen) Changes Vs. FY21 FY22 Changes FY22 FY21 Revised vs. Initial vs. • Revenue increased in Advanced Results Previous Materials, Specialty Chemicals forecast FY21 forecast forecast and Specialty Plastics; revenue 21.7 10.0 Revenue 168.3 190.0 (+12.9%) 1
Slide 17: FY22 Financial Forecast (2)
16 FY22 Financial Forecast (2) Revenue & Operating Profit by Segment (vs. FY21) (billion yen) Revenue 15.0 Core operating profit 87.5 FY21 Results FY21 Results FY22 Revised forecast FY22 Revised forecast 66.7 10.0 9.9 7.5 44.8 45.0 26.2 29.0 3.1 2.5 18.5 18.0 12.2 10.5 1.4 1.5 1.0 0.5 機能製品 Specialty
Slide 18: FY22 Financial Forecast (3)
17 FY22 Financial Forecast (3) Revenue & Operating Profit by Segment (vs. Initial forecast) (billion yen) Revenue 15.0 Core operating profit 87.5 FY22 Initial forecast 13.5 FY22 Initial forecast 82.0 FY22 Revised forecast FY22 Revised forecast 7.5 44.0 45.0 6.5 26.5 29.0 18.0 2.0 2.5 10.5 17.0 1.5 0
Slide 19: Segment Forecast: Advanced Materials
18 Segment Forecast: Advanced Materials (in billions of yen) Vs. FY21 FY21 FY22 Results Revised Change Revenue ➚ Operating profit ➚ % forecast Advanced plastics revenue and profit up: Advanced Materials - Robust PVDF sales in the automotive LiB Advanced plastics 47.8 67.0 +40% market - Higher pricin
Slide 20: Segment Forecast: Specialty Chemicals
19 Segment Forecast: Specialty Chemicals (in billions of yen) Vs. FY21 FY21 FY22 Results Revised Change Revenue ➚ Operating profit → % forecast Agrochemicals & Pharmaceuticals revenue up, Specialty Chemicals profit down: Agrochemicals 7.1 9.0 +28% - Higher pricing for agrochemicals - Favorable curre
Slide 21: Segment Forecast: Specialty Plastics
20 Segment Forecast: Specialty Plastics (in billions of yen) Vs. FY21 FY21 FY22 Results Revised Change Revenue → Operating profit ➘ % forecast Home products revenue and profit down: Specialty Plastics - Lower food wrap film volume Home products 23.2 22.5 -3% - Higher pricing for food wrap film (star
Slide 22: Segment Forecast: Construction
21 Segment Forecast: Construction (in billions of yen) Vs. FY21 FY21 FY22 Results Revised Change Revenue ➘ Operating profit ➘ % forecast Construction revenue and profit down: Construction - Fewer high-margin construction projects Construction 20.2 20.8 +3% Elimination -8.0 -10.3 -- (Intercompany sal
Slide 23: Segment Forecast: Other Operations
22 Segment Forecast: Other Operations (in billions of yen) Vs. FY21 FY21 FY22 Results Revised Change Revenue ➘ Operating profit ➘ % forecast Environmental engineering revenue and profit down: Other Operations - Decreased unit price and sales volume for low- Environmental level PCB waste treatment en
Slide 24: Cash Flow
23 Cash Flow (in billions of yen) FY22 FY21 Revised Change Results forecast Profit before income tax 20.4 28.0 7.6 Depreciation 11.6 11.5 -0.1 Other -3.4 -15.6 -12.2 Cash flow from operating activities 28.6 23.9 -4.6 Cash flow from investing activities -11.0 -17.6 -6.6 Free cash flow 17.6 6.4 -11.2
Slide 25: Key Indicators (1)
24 Key Indicators (1) (in billions of yen) Capital investment Depreciation expenses 20.3 12.1 11.7 11.6 11.5 14.9 14.3 14.3 10.3 10.2 10.3 13.2 9.9 11.4 10.5 10.3 9.8 8.2 8.2 7.6 6.1 5.9 5.9 5.8 7.4 5.4 5.1 5.0 5.4 6.0 5.5 5.8 5.4 4.8 4.0 5.8 6.7 6.1 6.7 9.8 5.0 5.1 4.9 5.0 6.0 5.8 5.7 5.7 2015 2016
Slide 26: Key Indicators (2)
25 Key Indicators (2) ROE ROIC 9.6% 8.4% 9.0% 8.4% 7.7% 7.4% 6.3% 6.5% 6.1% 6.6% 7.1% 5.8% 4.9% 4.1% 3.5% 2.9% 2015 2016 2017 2018 2019 2020 2021 2022 2015 2016 2017 2018 2019 2020 2021 2022 estimate 予想 estimate 予想 ROA DE Ratio 0.69 9.6% 0.57 7.1% 7.3% 7.0% 7.6% 5.3% 0.32 3.8% 0.24 0.23 2.7% 0.16 0.
Slide 27: III. Appendix
26 KUREHA CORPORATION lll. Appendix KUREHA a
Slide 28: Polyvinylidene Fluoride (PVDF) Business
27 Polyvinylidene Fluoride (PVDF) Business PVDF Business Revenue (¥ billions) 1Q-2Q FY22 Results 500 50 Recorded strong YoY growth in revenue and operating profit driven by: LiB binder - Higher prices Other applications - Improved product mix (increased sales of specialty polymers) - Continued manuf
Slide 29: Polyglycolic Acid (PGA) Business
28 Polyglycolic Acid (PGA) Business PGA Business Revenue 1Q-2Q FY22 Results • Achieved substantial revenue growth with sales expansion of PGA (¥ billions) 50 5.0 frac plugs for mid-/high-temperature shale drilling operations (increased per-well plug use) • Losses related to the US resin manufacturin
Slide 30: Returning to Shareholders
29 Returning to Shareholders ◼ Kureha’s basic policy on the distribution of earnings is to strengthen the company overall to achieve longer- term growth, provide for future business expansion, enhance retained earnings, and pay a stable and continued dividend. ◼ We also consider the acquisition of o
Slide 31: Consolidated Companies
30 Consolidated Companies (billions of yen) 1Q-2Q FY21 1Q-2Q FY22 Change Revenue Total assets Revenue Total assets Revenue Total assets Kureha Corp. 34.6 201.4 45.5 215.0 10.9 13.6 Kureha Trading Group 10.2 14.0 12.3 15.3 2.1 1.4 Kureha Corp. 17.6 -- 29.6 -- 12.1 -- Kureha Trading Group 7.2 -- 8.7 -
Slide 32: Consolidated Companies (cont'd)
31 Consolidated Companies (cont’d) (billions of yen) 1Q-2Q FY21 1Q-2Q FY22 Change Revenue Total assets Revenue Total assets Revenue Total assets Kurehanishiki Construction 7.2 10.9 6.5 11.0 -0.7 0.1 Group Construc- Kureha Service Group 1.8 2.4 2.2 1.8 0.4 -0.5 tion Consolidation adjustments -3.5 --
Slide 33: Disclaimer
32 Disclaimer • This presentation material is provided for a deeper understanding of our company, and is not intended to be used as a solicitation for investment or other activities. • This material has been prepared by our company based on the information available at the time of the presentation.