Slide 1: FY2009 2Q Results
Trend Micro FY2009. 2Q Results Mahendra Negi COO / CFO , Representative Director August 11, 2009
Slide 2: Forward Looking Statements
Forward Looking Statements Certain Statements that we make in this presentation are forward-looking statements. These forward- looking statements are based upon management’s current assumptions and beliefs in light of the information currently available to it, but involve known and unknown risks and
Slide 3: FY2009 2Q Financial Highlight
FY2009. 2Q Financial Highlight （Second quarter ended June 30, 2009） 3 Copyright 2009 - Trend Micro Inc.
Slide 4: Consolidated Results
Consolidated Results Three months (in million Yen) (unaudited) ended Jun 30, 2Q2008 2Q2009 YoY growth Net sales 26,105 24,244 - 7% Cost of sales 3,859 3,511 - 9% Operating expenses 13,693 13,503 - 1% Operating income (Margin) 8,552 (33%) 7,229 (30%) - 15% Ordinary income 9,313 7,522 - 19% Net income
Slide 5: USD based Results (Non-GAAP)
USD based Results (Non-GAAP) (unaudited) Three months (in thousand USD) ended Jun 30, 2Q2008 2Q2009 YoY change Net sales 249,284 249,373 0% Cost of sales 36,852 36,115 - 2% Operating expenses 130,760 138,900 6% Operating income 81,670 74,358 - 9% Ordinary income 88,933 77,372 - 13% Net Income 37,595
Slide 6: Net Sales Growth by Region
Net Sales Growth by Region (in million Yen) (unaudited) - 3% 10,000 9,885 9,631 9,000 2Q2008 8,000 + 2% 2Q2009 7,000 6,570 6,729 6,551 - 22% 6,000 5,100 5,000 4,000 - 9% 3,000 2,325 2,124 2,000 - 15% 1,000 772 658 0 Japan North America Europe Asia Pacific Latin America (In accordance with Japan GAAP
Slide 7: Net Sales Growth by Region (constant currency)
Net Sales Growth by Region If currency exchange rates used for 2Q2008 were used for 2Q2009: (in million Yen) (unaudited) * ( ) : difference from GAAP base 10,000 9,885 9,631 - 3% (0) 9,000 + 10% (+512) 2Q2008 8,000 - 4% 7,242 2Q2009 (+1,192) 7,000 6,570 6,551 6,292 6,000 5,000 + 10% 4,000 (+441) 3,0
Slide 8: Decomposition of Revenue (vs Last year)
Decomposition of Revenue （ｖｓ Ｌａｓｔ year） Latin America Europe + 124M - 258M (unaudited) Japan Asia Pacific + 240M - 253M North America + 671M Exchange impact - 2,385M 2008Ｑ2 Net sales 2009Ｑ2 Net sales 26,105 M 24,244 M (Non-GAAP) 8 Copyright 2009 - Trend Micro Inc.
Slide 9: Sales by Segment
Sales by Segment 10,000 Growth rate 9,000 Consumer + 11% 8,000 4,372 All Enterprise - 14% 7,000 6,000 3,003 5,000 303 4,000 3,000 4,796 5,259 2,000 3,725 418 1,000 1,705 21 637 0 Japan North Europe APAC Latin America America (Non-GAAP) 9 Copyright 2009 - Trend Micro Inc.
Slide 10: % share by region
% share by region (unaudited) 2Q2008 2Q2009 26,105 million Yen 24,244 million Yen Asia Latin Asia Latin Pacific America Pacific America 9% 3% 9% 3% Japan Japan 38% Europe Europe 40% 21% 25% North North America America 25% 28% (In accordance with Japan GAAP) 10 Copyright 2009 - Trend Micro Inc.
Slide 11: Bookings (Amount of contracts concluded)
Bookings (Amount of contracts concluded) (in million Yen) (unaudited) - 1% 11,066 10,918 2Q2008 2Q2009 7,625 - 17% 6,920 6,352 - 21% 5,471 3,246 2,792 - 14% - 17% 910 753 Japan North Am erica Europe Asia Pacific Latin Am erica (Non-GAAP) * Bookings = Net sales + Deferred revenue balance as of this Q
Slide 12: Local currency based Bookings (US, Europe)
Local currency based Bookings (US, Europe) North America (*excluding Canada) Bookings in $ and EMEA Bookings in € (unaudited) 2Q2008 2Q2009 2Q2008 ($ in thousands) (€ in thousands) 2Q2009 80,000 40,000 + 7% 36,900 37,242 + 1% 70,000 67,243 35,000 62,564 60,000 30,000 50,000 25,000 40,000 20,000 30,0
Slide 13: Deferred Revenue
Deferred Revenue (unaudited) (in million Yen) * Total of current and long term 72,000 70,000 71,751 69,817 69,707 68,000 66,000 67,516 64,000 65,166 62,000 60,000 58,000 56,000 54,000 52,000 50,000 Jun-'08 Sep-'08 Dec-'08 Mar-'09 Jun-'09 (In accordance with Japan GAAP) 13 Copyright 2009 - Trend Micr
Slide 14: Deferred Revenue by Region
Deferred Revenue by Region (in million Yen) (unaudited) 40,000 35,654 4% * Total of current and long term 35,000 34,367 30,000 Mar-09 Jun-09 25,000 -2% 20,000 17,340 16,963 3% 15,000 12,195 12,566 10,000 14% 5,000 4,637 5,305 8% 1,167 1,261 0 Japan North America Europe Asia Pacific Latin America (In
Slide 15: Deferred Revenue by Region (constant currency)
Deferred Revenue by Region If currency exchange rates used as of the end of 1Q2009 were used as of the end of 2Q2009: (in million Yen) (unaudited) * ( ) : difference from GAAP base 40,000 4% * Total of current and long term 35,654 (0) 35,000 34,367 Mar-09 30,000 Jun-09 25,000 0% (+392) 20,000 17,340
Slide 16: Cost
Cost (in million Yen) (unaudited) Stock option & Goodwill Salary & Benefit Office overhead Outside service Administration Selling & Marketing Goods / Material 20,000 18,000 603 451 519 688 16,000 3,198 3,342 743 2,954 3,201 14,000 2,411 2,647 2,474 2,052 12,000 2,791 2,252 2,388 10,000 2,086 2,075 2
Slide 17: Bookings vs Total costs
Bookings vs Total costs (in million Yen) (unaudited) Bookings Total Costs 32,000 30,000 28,000 29,769 26,000 27,456 26,288 24,000 22,000 23,667 20,000 21,680 18,000 18,385 16,000 17,552 17,014 16,699 14,000 15,886 12,000 10,000 8,000 6,000 4,000 2,000 0 2008Q2 2008Q3 2008Q4 2009Q1 2009Q2 (Non-GAAP)
Slide 18: Q2 Highlights
Q2 Highlights • New technology products showing good growth • Overall revenue flow improving 18 Copyright 2009 - Trend Micro Inc.
Slide 19: Q2 Lowlights
Q2 Lowlights • Customer spending still very weak • Growth in Enterprise business below expectations • ＰＣ ＯＥＭ business pricing going down sharply 19 Copyright 2009 - Trend Micro Inc.
Slide 20: Headcount
Headcount Mar - 2009 Jun - 2009 4,239 4,304 ADM, ADM, Business Process Business Process Sales, Sales, Marketing Marketing 618 648 Technical 1,154 + 65 Technical 1,191 Support (+ 2%) Support Research, Research, Development Development 1,331 1,299 1,136 1,166 20 Copyright 2009 - Trend Micro Inc.
Slide 21: Non-operating & Extra-ordinary Items
Non-operating & Extra-ordinary Items (unaudited) Other income Exchange loss Equity in gains of affiliated companies 41 M 153M Other expense 17M Loss on disposal of fixed assets Interest income 6M 140 M 394M Ordinary Income 7,522 M Operating income Income before income taxes 7,229M 7,381 M (In accord
Slide 22: Balance Sheet
Balance Sheet (unaudited) (in million Yen) Mar-2009 change Jun-2009 Assets Cash & cash equivalents 67,869 + 3,390 71,259 Account receivable (less allowance for doubtful accounts) 21,775 - 2,210 19,565 Marketable securities & Securities investments 52,848 + 7,808 60,656 Liabilities Deferred revenue (
Slide 23: Snapshot of our CDO investments (Update)
Snapshot of our CDO investments （Update） # We don’t have any CDOs related to RMBS (e.g. Subprime mortgages). # Since the underlying cash flow is intact, we intend to hold till maturity. # Exposure as a % of our “Marketable securities & Securities investments” : 2% # Exposure as a % of our “Cash + Ma
Slide 24: FY2009 Semi Annual Financial Highlight
FY2009 Semi Annual Financial Highlight 24 Copyright 2009 - Trend Micro Inc.
Slide 25: Consolidated Results (Annual)
Consolidated Results (Annual) (unaudited) (in million Yen) Six months ended Jun 30, 1H2008 1H2009 YoY growth Net sales 51,709 47,159 - 9% Cost of sales 7,914 7,108 - 10% Operating expenses 26,904 25,793 - 4% Operating income (Margin) 16,890 (33%) 14,257 (30%) - 16% Ordinary income 16,830 15,458 - 8%
Slide 26: Net Sales Growth by Region
Net Sales Growth by Region (in million Yen) (unaudited) 20,000 19,709 19,416 - 1% 18,000 1H2008 16,000 1H2009 - 1% 14,000 12,748 12,683 12,737 12,000 - 23% 10,000 9,849 8,000 - 21% 6,000 5,005 3,966 4,000 - 18% 2,000 1,508 1,243 0 Japan US Europe Asia Pacific Latin America (In accordance with Japan
Slide 27: Net Sales Growth by Region (constant currency)
Net Sales Growth by Region If currency exchange rates used for 1H2008 were used for 1H2009: (in million Yen) (unaudited) * ( ) : difference from GAAP base 20,000 19,709 19,416 - 1% (0) 18,000 + 9% 1H2008 16,000 (+1,217) 1H2009 13,900 14,000 12,748 12,737 12,432 - 2% (+2,583) 12,000 10,000 8,000 - 0%
Slide 28: Cash flows
Cash flows (unaudited) (in million Yen) 項目 1H 2008 1H 2009 YoY growth Cash flows from operating activities 17,094 22,095 29% Cash flows from investing activities 18,362 - 9,521 － Cash flows from financing activities - 21,229 - 13,481 － Effect of exchange rate changes on cash and cash equivalents - 3
Slide 29: Q3 forecast assumptions
Q3 forecast assumptions • Japan increases by low single digits, while US decreases by single digit and Europe decreases by double digits due to forex headwind • Stock option expenses will be 0.6Bn yen • Estimated exchange rate: 1USD = 95 yen ( last year: 108 yen) 1EUR = 130 yen ( last year: 161 yen)
Slide 30: Projection for 3Q2009
Projection for 3Q2009 (unaudited) For 3Q2009 Expected (in million Yen) Jul - Sep, 2009 YoY growth Net Sales 25,000 - 4% Operating Income 7,400 -2% Ordinary Income 7,600 -17% Net Income 4,600 - 22% (In accordance with Japan GAAP) • Including both stock option expenses and amortization of goodwill （ab
Slide 31: Amendment of minimum trading unit
Amendment of minimum trading unit • Minimum trading unit: 500 shares to 100 shares • Objective: To improve liquidity of our company’s stocks at TSE • Effective date: From September 1, 2009 31 Copyright 2009 - Trend Micro Inc.
Slide 32: Appendix
Appendix 32 Copyright 2009 - Trend Micro Inc.
Slide 33: Quarterly Chart (1)
Appendix Quarterly Chart (1) (unaudited) (in million Yen) FY2008 FY2009 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Ｎｅｔ sale s 25,604 26,105 25,968 24,030 22,915 24,244 Co st o f sale s 4,054 3,859 4,188 3,646 3,597 3,511 O pe r atin g e xpe n se s 13,211 13,693 14,197 13,053 12,289 13,503 O pe r atin g in c o me 8,338
Slide 34: Quarterly Chart (2)
Appendix Quarterly Chart (2) (unaudited) (in million Yen) FY2008 FY2009 （ S ale s by r e gio n ） Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Japan 9,823 9,885 9,405 9,987 9,784 9,631 US 6,178 6,570 7,098 6,344 5,953 6,729 Eu r o pe 6,185 6,551 6,137 5,016 4,748 5,100 Asia P ac ific 2,680 2,325 2,530 2,060 1,842 2,124 L
Slide 35: Thank You
Thank You 35 Copyright 2009 - Trend Micro Inc.