Nsk Ltd. · TSE:6471
Nsk — Investor Presentation (November 2023)
23 slides from Nsk's investor presentation, November 2023
Slide 1: NSK Ltd. Supplementary Information FY2022
NSK Ltd. Supplementary Information FY2022 Cautionary Statements with Respect to Forward-Looking Statements Statements made in this report with respect to plans, strategies and future performance that are not historical fact are forward-looking statements. NSK cautions that a number of factors could
Slide 2: Company Profile
Company Profile ■Company Name NSK Ltd. ■Established November 8, 1916 ■Capital ¥67.2 billion (As of March 31, 2023) ■Sales ¥938.1 billion (Year ended March 31, 2023) ■Operating Income ¥32.9 billion (Year ended March 31, 2023) ■Subsidiaries 92 companies (As of March 31, 2023) ■Number of Employees 29,8
Slide 3: FY2022 Sales Breakdown by Business Segment
FY2022 Sales Breakdown by Business Segment ※（）excluding Steering business 3% Others 26% 34% Industrial Machinery Automotive Bearings Components Sales ¥938.1 billion Including Steering Precision Machinery and Parts Automotive Bearings 7% 30% Others Steel Ball Copyright NSK Ltd. All Rights Reserved. 2
Slide 4: Business Trends – Consolidated Business Trend
Business Trends – Consolidated Business Trend – ● Operating Income % 15.3% 14.8% ◆ ROE 13.9% (Billions of yen) 10.3% 10.6% 9.9% 10.4% 9.2% 5.2% 9.6% 3.4% 3.5% 10.0% 9.7% 3.3% 6.1% 7.8% 6.9% 8.0% 6.1% 0.1% 2.8% 4.4% 1,020.3 2.8% 0.9% 3.0% 974.9 991.4 975.3 949.2 938.1 ■Sales (Left) 871.7 97.3 97.9 94
Slide 5: Business Trends – Sales by Customer Location
Business Trends – Sales by Customer Location – (Billions of yen) Japan The Americas Europe China Other Asia Non-Japan ratio 66.3% 67.4% 66.9% 65.2% 62.2% 63.5% 62.9% 63.1% 63.3% 62.2% 1,020.3 991.4 938.1 54.5% 974.9 975.3 949.2 871.7 142.8 141.1 865.2 137.2 137.0 130.4 831.0 144.8 732.8 116.3 212.1
Slide 6: Business Trends – Sales by Business Segment
Business Trends – Sales by Business Segment – Industrial Machinery Precision Machinery Automotive Automotive Others Automotive Business Ratio Bearings and Parts Bearings Components (Billions of yen) 72% 73% 71% 68% 70% 67% 67% 63% 60% 56% 56% 1,020.3 991.4 974.9 975.3 949.2 30.5 31.7 938.1 871.7 41.
Slide 7: Mid-Term Management Plan 2026 (MTP2026) FY2022 to FY2026
Mid-Term Management Plan 2026 (MTP2026) FY2022 to FY2026 Copyright NSK Ltd. All Rights Reserved. 6
Slide 8: MTP2026: Overall Image and Positioning
MTP2026: Overall Image and Positioning 6th MTP MTP2026 Post2026 Rebuild corporate foundation for sustainable growth FY19-20-21 FY22 ー 24 ー 26 Continue Build business base and strengthen resources in "Change & Go Beyond" to become exceling for next preparation for next growth phase new type of trilli
Slide 9: New Type of Trillion-yen Company: Portfolio reform
New Type of Trillion-yen Company Portfolio reform; 10% operating margin; 10% ROE ≫ Portfolio reform Expand Industrial 1 Machinery business 2 Deploy bearings + precision machinery to drive earnings 3 Grow new products Bearings & Beyond FY17 MTP2026 Post2026 Sales: ¥1 trillion Sales: ¥1 trillion ■ Ind
Slide 10: MTP2026 Key Priorities
MTP2026 Key Priorities We aim to be a needed and trusted company that contributes to the development of a sustainable society by creating new value through the fusion of tribology and information technology Create ESG Management new value Growth with Profitability Be needed, trusted, and Change & Go
Slide 11: Growth with Profitability – Industrial Machinery Business
Growth with Profitability – Industrial Machinery Business > Expand Industrial Machinery Business ■ Aim to capture expanding market demand in electrification, automation, digitalization ■ Strengthen supply capabilities and enhance technical services system ≫ FY26 targets: Sales of ¥450.0 billion; ope
Slide 12: Growth with Profitability – Automotive Bearings Business
Growth with Profitability – Automotive Bearings Business ＞ Respond to electrification of automobiles ■ Achieve increase in EV-related sales in excess of decline in ICE-related sales and thus surpass prior peak ■ Aim to achieve high market share in products related to low torque, high-speed rotation,
Slide 13: Growth with Profitability – Automotive Components
Growth with Profitability – Automotive Components > Restructure steering business and pursue alliances/M&As ■ Restore production volume and profitability through structural reform of steering business; return to profitability in FY23 (2nd half); achieve operating margin of 4% in FY26 ■ Utilize allia
Slide 14: Growth with Profitability – Grow New Products
Growth with Profitability – Grow New Products ■ Industrial Machinery Business Spread of automation, electrification, and predictive Acceleration of energy maintenance technologies transition Expand hydrogen-related businesses "Broaden CMS" Actuators for robots Synergies with BKV Sales target: Active
Slide 15: ESG Management – Promoting Carbon Neutrality
ESG Management – Promoting Carbon Neutrality ■ Build a carbon-neutral society through “Create and Utilize” approach ■ New target: Achieve Scope 1+2 -50% compared to FY2017 by FY2026 Achieve Scope 1+2carbon neutrality by FY2035 Environmental contribution by using “tribology” Reduce CO2 emissions from
Slide 16: MTP2026 Capital Allocation
MTP2026 Capital Allocation ■ Contributing to creating a sustainable society while continuously growing corporate value Invest for sustainable growth Growth with profitability Strengthen managerial resources ROE: 10%+ ✓Capital expenditures ROIC: 8%+ : ¥350.0 billion /5 years ESG management ≫ Ordinary
Slide 17: Progress of MTP2026 as of FY2022
Progress of MTP2026 as of FY2022 Copyright NSK Ltd. All Rights Reserved. 16
Slide 18: Change of Business Environment in MTP2026
Change of Business Environment in MTP2026 ✓Changing Business Environment Slow recovery in volume of automotive production due to semiconductor shortages, slower economic growth in China, US-China friction (nationalism), expansion of inflation, increasing risk of slowdown in economic growth due to mo
Slide 19: Mid-Term Initiatives Toward 10% ROE and Higher PBR
Mid-Term Initiatives Toward 10% ROE and Higher PBR ✓Growth with Profitability: Rebuild Business Foundation to Focus on Bearings and Precision Products to Achieve Operating Income Above 10% ≫ Reflect inflation costs in sales prices ≫ Improve asset efficiency and profitability on downwardly revised as
Slide 20: Growth with Profitability – Industrial Machinery Business
Growth with Profitability －Industrial Machinery Business－ ✓Aim to be 50% of sales by continuing strategies focusing on electrification, automation, digitalization and global push to reduce environmental impact ✓Strengthen supply capacity and enhance technical service systems ≫ FY26 targets: Sales of
Slide 21: Growth with Profitability – Automotive Business (excl. Steering Business)
Growth with Profitability －Automotive Business (excl. Steering Business)－ ✓Accelerate production restructuring due to downward revision of automotive production volume assumption in MTP2026 ✓Developing new customers’ in EVs and receiving orders for electrification are proceeding as planned ≫ FY26 ta
Slide 22: Growth with Profitability – Steering Business
Growth with Profitability - Steering Business - ✓Terminated joint venture discussion with thyssenkrupp AG and signed joint venture agreement with Japan Industrial Solutions III Investment Limited Partnership (JIS) ✓Plan to change status of NSK Steering & Control, Inc., a subsidiary of the Company, t
Slide 23: MTP2026 Shareholder Return Policy and Progress
MTP2026 Shareholder Return Policy and Progress Policy Progress Continue stable shareholder returns - Payout ratio: 30-50% ≫ FY22 actual cash dividends per share ¥30 - Total return ratio: approx. 50％ ≫ FY22 actual dividend payout ratio 83.6％ - Buybacks: flexibly implemented ≫ FY23 planned cash divide