Slide 1: Financial Conference: Consolidated Business Results and Forecast
FINANCIAL CONFERENCE Consolidated Business Results and Forecast May 16, 2012 NSK Ltd. 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.
Slide 2: Contents
Contents Consolidated Business Results 1 for the Year Ended March 31, 2012 Consolidated Business Forecast 2 for the Year Ended March 31, 2013 3 Progress of Mid-Term Plan (Supplementary Material) 1
Slide 3: Consolidated Business Results for the Year Ended March 31, 2012
Consolidated Business Results 1 for the Year Ended March 31, 2012 2
Slide 4: Summary of Consolidated Business Results for the Year Ended March 31, 2012
Summary of Consolidated Business Results for the Year Ended March 31, 2012 Business Environment ✓Industrial Machinery：Demand steadily increased in 1H, mainly in emerging countries. From the beginning of 3Q, demand slowed due to European debt crisis and policy changes in China. ✓Automotive Products：H
Slide 5: Summary of Consolidated Business Results for the Year Ended March 31, 2012
Summary of Consolidated Business Results for the Year Ended March 31, 2012 （Billions of yen） Increase/ ’11/3 ’12/3 decrease Difference <Actual> <Actual> YOY YOY Sales 710.4 733.2 +22.8 +3.2% Operating income 43.5 44.4 +0.9 +2.1% <%> <6.1%> <6.1%> Ordinary income 38.6 42.0 +3.4 +8.9% Income before ta
Slide 6: Quarterly Business Performance
Quarterly Business Performance Sales Operating income / Margin Automotive sales increased due to recovery Despite continued appreciation of the Japanese yen, operating income increased from the earthquake and an increase in EPS thanks to industrial machinery volume business. Industrial machinery sal
Slide 7: Results by Business Segment
Results by Business Segment (Billions of yen) Increase/ ’11/3 ’12/3 decrease Difference <Actual> <Actual> YOY YOY Sales 710.4 733.2 +22.8 +3.2% Industrial machinery 259.1 255.8 -3.3 -1.3% business Industrial machinery bearings 199.9 210.8 +10.9 +5.5% Precision machinery and parts 59.2 45.0 -14.2 -24
Slide 8: Quarterly Business Segment Performance
Quarterly Business Segment Performance Industrial Machinery Business (Billions of yen) Sales (Billions of yen) Operating income / Margin 100 Industrial Machinery Precision Machinery Systemized 15 Bearings and Parts Products 80 65.4 66.2 9.2% 9.3% 11.3% 11.3% 9.5% 61.8 65.7 68.0 7.9% 5.5 4.1 2.6 65.1
Slide 9: Operating Income: Factors Behind Increase
Operating income : Factors Behind Increase (11/3 ⇒ 12/3) Reduction of external （Billions of yen) YOY increase of procurement costs etc. ’12/3 +0.9 Decline in 44.4 ’11/3 sales price +8.1 43.5 △6.0 Effect of Effect of exchange volume increase rate fluctuations △5.1 Increase in +18.0 △17.1 other costs
Slide 10: Business Results by Customer Location
Business Results by Customer Location Increase/ (Billions of yen) ’11/3 ’12/3 decrease Difference <Actual> <Actual> YOY YOY Sales 710.4 733.2 +22.8 +3.2% Japan 354.5 363.8 +9.3 +2.6% Non-Japan 355.9 369.4 +13.5 +3.8% (Non- (Non-Japan ratio) (50.1%) (50.4%) The Americas 85.5 86.3 +0.8 +0.9% Europe 10
Slide 11: Business Results by Geographical Segment
Business Results by Geographical Segment 【Japan】 【The Americas】 ’11/3 ’12/3 Increase/ ’11/3 ’12/3 Increase/ Difference Difference (Billions of yen) decrease YOY (Billions of yen) decrease YOY Actual Actual YOY Actual Actual YOY Sales 532.3 538.4 +6.1 +1.1% Sales 84.7 86.1 +1.4 +1.6% Operating Operat
Slide 12: Consolidated Balance Sheets
Consolidated Balance Sheets 資 産 Assets 負債／純資産 Liabilities and Net Assets Non- Non-current assets Current Assets Non- Non-Current Current Ratio of Net Worth Net Assets Liabilities Liabilities to Total Capital （Billions of yen） （Billions of yen） Change YOY Change YOY 845.1 +56.5 845.1 +56.5 788.6 788.
Slide 13: Inventory/Interest-Bearing Debt, Capital Expenditure/Depreciation
Inventory/ Interest-Bearing Debt, Capital Expenditure/ Depreciation 棚卸資産 Inventories 設備投資 Capital Expenditure Japan Non- Non-Japan Inventory turnover Japan Non-Non-Japan （Billions of yen）6.5 （Billions of yen） 6.5 50.3 111.6 115.4 38.7 58.9 65.4 31.1 21.2 52.7 50.0 17.5 19.2 ’11/3 Year- Year-end ’12/
Slide 14: Consolidated Business Forecast for the Year Ending March 31, 2013
Consolidated Business Forecast 2 for the Year Ending March 31, 2013 13
Slide 15: Summary of Consolidated Business Forecast for the Year Ending March 31, 2013
Summary of Consolidated Business Forecast for the Year Ending March 31, 2013 Business Forecast ✓ Sales ¥780.0 billion (+6.4% YoY) / Operating Income ¥50.0 billion (+12.6% YoY ) Ordinary Income ¥46.0 billion (+9.5% YoY) / Net Income ¥30.0 billion (+5.3% YoY) ✓ YOY Increase in both sales and operating
Slide 16: Summary of Consolidated Business Forecast for the Year Ending March 31, 2013
Summary of Consolidated Business Forecast for the Year Ending March 31, 2013 （Billions of yen） yen） ’12/3 ’13/3 1st half 2nd half Full Year 1st half 2nd half Full Year Difference Change <Actual> <Actual> <Actual> <Forecast> <Forecast> <Forecast> YOY YOY Sales 351.9 381.3 733.2 385.0 395.0 780.0 +46.
Slide 17: Key Strategies for the Year Ending March 31, 2013
Key strategies for the Year Ending March 31, 2013 Profitability Improvement Initiatives - Persistence to Achieve Mid-Term Target - - Countermeasures to strengthen cost competency Sales expansion with emphasis on profitability - Implementing primary countermeasures by segments Industrial machinery bu
Slide 18: Forecast by Business Segment
Forecast by Business Segment （Billions of yen） ’12/3 ’13/3 1st half 2nd half Full Year 1st half 2nd half Full Year Difference Chang e YOY <Actual> <Actual> <Actual> <Forecast> <Forecast> <Forecast> YOY Sales 351.9 381.3 733.2 385.0 395.0 780.0 +46.8 +6.4% Industrial machinery business 133.1 122.7 25
Slide 19: Operating Income: Factors Behind Increase (Forecast)
Operating income : Factors Behind Increase (’12/3 ⇒ ’13/3 Forecast) （Billions of yen) YOY increase of ’13/3 +5.6 Reduction of external procurement costs etc. Forecast 50.0 +9.5 Decline in ’12.3期 44.4 sales price Effect of volume increase Effect of exchange △6.5 rate fluctuations △14.4 Increase in ot
Slide 20: Forecast by Customer Location
Forecast by Customer Location （Billions of yen） ’12/3 ’13/3 1st half 2nd half Full Year 1st half 2nd half Full Year Difference Change YOY YOY <Actual> <Actual> <Actual> <Forecast> <Forecast> <Forecast> Sales 351.9 381.3 733.2 385.0 395.0 780.0 +46.8 +6.4% Japan 170.9 192.9 363.8 187.0 189.0 376.0 +1
Slide 21: Forecast by Geographical Segment
Forecast by Geographical Segment （Billions of yen） yen） ’12/3 ’13/3 1st half 2nd half Full Year 1st half 2nd half Full Year Difference Change YOY YOY <Actual> <Actual> <Actual> <Forecast> <Forecast> <Forecast> Sales 351.9 381.3 733.2 385.0 395.0 780.0 +46.8 +6.4% Japan 262.7 275.7 538.4 271.5 275.5
Slide 22: Progress of Mid-Term Plan
3 Progress of Mid-Term Plan 21
Slide 23: Outline of the FY'09-FY'12 Mid-Term Plan
Outline of the FY’09~FY’12 Mid-Term Plan FY’03-FY’05 FY’06-FY’08 ０９～１２年度中期計画の位置付け FY’09-FY’12 FY’13-FY’15 Mid-Term Plan Mid-Term Plan Mid-Term Plan Mid-Term Plan Select & Focus strategy Growth strategy Respond to paradigm shifts Towards Business restructuring Improve profitability Organize business
Slide 24: Mid-Term Plan Progress
Mid-Term Plan Progress FY03-FY05 FY06-FY08 FY09-FY12 Mid-Term Plan Mid-Term Plan Mid-Term Plan Operating income % 8.7% 9.0% 8.5% (Billions of yen) 6.6% 6.8% 6.4% 6.1% 6.1% 5.0% (Billions of yen) 1,000 3.4% 200 1.9% 772.0 780.0 780.0 800 717.2 710.4 733.2 150 Sales 628.5 647.6 581.0 587.6 600 522.2 1
Slide 25: Mid-Term Plan Progress – Industrial Machinery Business
Mid-Term Plan Progress – Industrial Machinery Business Industrial Industrial machinery machinery bearings bearings Mid-term countermeasures Mid-term countermeasures (original) (original) (Billions of yen) Sales ● Expand sales in emerging countries ( ) Incl. systemized Systemized products Precision m
Slide 26: Mid-Term Plan Progress – Industrial Machinery Business
Mid-Term Plan Progress – Industrial Machinery Business Sales Sales expansion expansion in in emerging emerging countries countries Aftermarket Aftermarket sales sales expansion expansion Industrial machinery business sales in China/India (’09/3=100) (index) 180 AM Sales No. of distributors 140 (’09/
Slide 27: Mid-Term Plan Progress – Automotive Business
Mid-Term Plan Progress – Automotive Business Automotive Automotive Products Products Global Global automotive automotive production production volume volume (Billions of yen) Japan North America Europe BRICS Others 79 Sales 80 73 76 72 492.5 6 9 (millions of vehicle) 13 500 70 66 12 424.2 444.6 450.
Slide 28: Mid-Term Plan Progress – Automotive Business
Mid-Term Plan Progress – Automotive Business Sales Sales expansion expansion to to emerging emerging countries countries Results of countermeasures 【Sales in emerging countries】 ■ Expand sales in emerging countries 200 (’09/3=100) ◇ 70% increase compared to FY2008 175 ◇ Investment in a local Chinese
Slide 29: Strengthen Business Infrastructure in China
Strengthen business infrastructure in China ■Business infrastructure enhancement plan China headquarters / Technology center for FY09-FY12 ① Administrative China Headquarter Relocation Shenyang ② Technology Technology center Relocation/New ③ Production Shenyang B/S New construction Shenyang ④ Large-
Slide 30: Strategic Region: China
<Strategic Region> China Further expansion of business in China (Billions of yen) Production Others FY12 - Establish production of full lineup, Automotive business continue capacity increase Direct Industrial machinery business FY10 trade - Production ratio in China Imported 65% 1000 100 FY10: 50% ⇒
Slide 31: Mid-Term Plan Progress – Summary
Mid-Term Plan Progress –Summary- ≪Growth strategy≫ - Achieved sales growth target on volume base - Sales in China (strategic region) and in EPS (strategic product) steadily increased - Promoting enhancement of business base for next growth phase ≪Profitability improvement≫ - Promote local procuremen
Slide 32: Supplementary Material: Mid-term Target for Profitability Enhancement
(Supplementary Material) - Mid-term Target for Profitability Enhancement Mid-term Plan FY09 – FY12 Target announced in Nov 09 09/3 10/3 11/3 12/3 13/3 13/3 (Billions of yen) Actual Actual Actual Actual Forecast Mid- Mid-term target Operating 3.4% 1.9% 6.1% 6.1% 6.4% 8.5% Income % ROE 1.8% 2.0% 10.3%
Slide 33: Supplementary Material: Mid-term Target by Business Segment
(Supplementary Material) - Mid-term Target by Business Segment Target announced Mid-term Plan FY09 – FY12 in Nov 09 09/3 10/3 11/3 12/3 13/3 13/3 (Billions of yen) Actual Actual Actual Actual Forecast Mid- Mid-term target Industrial machinery business Sales 267.0 202.0 259.1 255.8 257.0 300.0 Indust