Nippon Paint Holdings Co., Ltd. · TSE:4612
Nippon Paint — Nippon Paint Hldgs — Q4 2023 Earnings Presentation
43 slides from Nippon Paint's earnings presentation, Feb 14, 2024
Slide 1: FY2023 4Q Financial Results Presentation Material
February 14, 2024 FY2023 4Q Financial Results Presentation Material FY2023 4Q Summary/Topics P.3 Supplemental Material P.12 1. FY2023 4Q Results: Highlights P.13 2. FY2023 4Q Results: By Segment P.16 3. FY2023 Results P.26 (Appendix) Reference Data
Slide 2: Supplementary Information
Supplementary Information Analysis of operational results In this document, we present our operational results in two formats: the reported basis (“Tanshin”) and the adjusted basis (“Non-GAAP”). The analysis of factors contributing to changes primarily utilize Non-GAAP data, except for QoQ analysis
Slide 3: Summary: FY2023 4Q Operational Results
1. Summary: FY2023 4Q Operational Results –Increased Revenue/Profit with Margin Improvement *1 ◆ Tanshin FY2023 4Q • Increased revenue (+8.4%), propelled by volume growth and pricing flow-through, notably in decorative business • Gross profit margin improved 2.2pp YoY, attributed to improved RMCC ra
Slide 4: Summary: FY2023 Operational Results – Record Revenue and Operating Profit
2. Summary: FY2023 Operational Results –Record Revenue and Operating Profit ◆ Tanshin FY2023 • [Record revenue] Achieved through volume growth and pricing flow-through, primarily in decorative business, new consolidation, and favorable FX; approximately meeting ¥1,450 bn as per November revenue guid
Slide 5: Summary: FY2024 Forecast
3. Summary: FY2024 Forecast –Expecting Another Year of Record Revenue and Operating Profit ◆ Summary FY2024 • Expect +10.9% revenue growth to a record ¥1,600 bn, driven by organic growth (c. +7~7.5%) from market share strategies in all regions, adjacencies business enhancement, and new consolidation
Slide 6: Assumptions for FY2024 Forecast (1)
4. Assumptions for FY2024 Forecast (1) Revenue OP margin FY2023 FY2024 FY2023 FY2024 Overview Results Forecast Results Forecast (Tanshin/bn yen) (In LCY*1) (Tanshin/%) (In LCY)*2 Segment total 201.5 +0~5% 9.5% → Automotive 42.1 c. -5% Slightly lower revenue reflecting a flat outlook for auto product
Slide 7: Assumptions for FY2024 Forecast (2)
4. Assumptions for FY2024 Forecast (2) Revenue OP margin FY2023 FY2024 FY2023 FY2024 Overview Results Forecast Results Forecast (Tanshin/bn yen) (In LCY) (Tanshin/%) (In LCY)* Segment total 360.4 c. +10% 9.6% → Organic growth of mid-single digits, despite flat markets, complemented DGL (Pacific) 222
Slide 8: Raw Material Market Conditions and Impact on Our Operations
5. Raw Material Market Conditions and Impact on Our Operations Anticipate a slight decrease in RMCC ratio, while monitoring market trends closely FY2023 4Q FY2024 1Q and beyond • Crude oil prices have declined by 20% since September, due to the failure of OPEC+ to agree • With the recent downturn in
Slide 9: Market & Business Environment
6. Market & Business Environment Both the automotive and decorative markets expected to remain roughly flat in FY2024 DGL DGL Japan NIPSEA China Americas (Pacific) (Europe) Automotive FY2023 4Q Decorative TUC TUB FY2024 Automotive 1Q (outlook) Decorative TUC TUB Automotive FY2024 (outlook) Decorativ
Slide 10: Summary of Operating Results in Major Segments
7. Summary of Operating Results in Major Segments (Billion yen) Tanshin Non-GAAP FY2023 FY2023 Overview YoY YoY 4Q 4Q Revenue 54.5 +6.1% 54.3 +5.8% Higher revenue, despite decorative and industrial revenue holding steady, driven mainly by strong automotive revenue Japan OP 6.7 +577.7% 6.6 +108.8% Hi
Slide 11: Major Topics
8. Major Topics Completed Acquisition of Alina, a Kazakhstani Paint and Dry-Mix Mortars (adjacencies) Manufacturer (Announced on January 18) • Acquired 75% of the share capital of Alina through NIPSEA Group. We are entitled to purchase the remaining 25% of the share capital in three years or earlier
Slide 12: Supplemental Material
Supplemental Material 1. FY2023 4Q Results: Highlights … P.13 2. FY2023 4Q Results: By Segment … P.16 3. FY2023 Results … P.26 (Appendix) Reference Data
Slide 13: FY2023 4Q Results: Highlights
1. FY2023 4Q Results: Highlights 13
Slide 14: Highlights (Consolidated)
1-1．Highlights (Consolidated) (Billion yen) Results (Tanshin) Results (Non-GAAP) FY2022 FY2023 YoY FY2022 FY2023 YoY YoY (％) (Amount) (％) Key one-off factors 4Q *1 4Q 4Q*1 4Q (the difference between Tanshin and Non-GAAP excluding FX impact) *Please refer to “Breakdown of Adjustments” in the Referenc
Slide 15: Highlights (by Segment)
1-2．Highlights (by Segment) (Billion yen) Results (Tanshin) Results (Non-GAAP) FY2022 FY2023 YoY FY2022 FY2023 YoY YoY 4Q * 4Q (％) 4Q * 4Q (Amount) (％) Revenue 51.3 54.5 6.1% 51.3 54.3 3.0 5.8% Japan Operating profit 1.0 6.7 577.7% 3.2 6.6 3.5 108.8% Revenue 169.6 179.7 6.0% 169.0 180.4 11.5 6.8% NI
Slide 16: FY2023 4Q Results: By Segment
2. FY2023 4Q Results: By Segment 16
Slide 17: Revenue and Operating Profit Analysis
2-1．Revenue and Operating Profit Analysis (Billion yen) Paint and Coatings Business * Revenue Non-GAAP basis +6.0% (+19.6) Tanshin basis +8.4% (+27.6) Operating Profit Non-GAAP basis +3.6 *Products included in the Paint and Coatings Business such as semi-finished products and fine chemicals with uni
Slide 18: Japan
2-2．Japan Results (Tanshin) Results (Non-GAAP) (Billion yen) FY2022 FY2023 YoY FY2022 FY2023 YoY YoY 4Q 4Q (％) 4Q 4Q (Amount) (％) Automotive coatings 10.0 11.2 12.3% 10.0 11.2 1.2 12.3% Decorative paints 12.7 12.7 -0.4% 12.7 12.7 -0.0 -0.4% Key one-off factors (the difference between Tanshin and Non
Slide 19: NIPSEA China
2-3．NIPSEA China (Billion yen) Results (Tanshin) Results (Non-GAAP) FY2022 FY2023 YoY FY2022 FY2023 YoY YoY 4Q 4Q (％) 4Q 4Q (Amount) (％) Automotive coatings 17.3 14.9 -13.6% 15.1 14.4 -0.7 -4.8% Key one-off factors Decorative paints 78.1 88.8 13.8% 79.6 85.0 5.4 6.8% (the difference between Tanshin
Slide 20: NIPSEA Except China
2-4．NIPSEA Except China*1 (Billion yen) Results (Tanshin) Results (Non-GAAP) FY2022 FY2023 YoY FY2022 FY2023 YoY Key one-off factors Figures are adjusted for YoY (the difference between Tanshin and Non-GAAP excluding FX impact) hyperinflationary accounting 4Q 4Q (％) 4Q 4Q (Amount) (％) *Please refer
Slide 21: PT Nipsea (Indonesia) & Betek Boya (Türkiye)
2-5．PT Nipsea (Indonesia) & Betek Boya (Tϋrkiye) (Billion yen) Results (Tanshin) Results (Non-GAAP) FY2022 FY2023 YoY FY2022 FY2023 YoY YoY 4Q 4Q (％) 4Q 4Q (Amount) (％) Revenue 13.7 16.1 17.4% 13.7 14.8 1.1 7.7% PT Nipsea Operating profit 5.4 5.5 1.2% 5.4 5.0 -0.4 -7.0% (Indonesia) OP margin 39.5% 3
Slide 22: DGL (Pacific)
2-6．DGL (Pacific) (Billion yen) Results (Tanshin) Results (Non-GAAP) FY2022 FY2023 YoY FY2022 FY2023 YoY YoY 4Q 4Q (％) 4Q 4Q (Amount) (％) Decorative paints 29.1 31.1 6.7% 29.1 29.8 0.7 2.4% Industrial coatings 2.4 2.6 9.1% 2.4 2.5 0.1 4.7% Key one-off factors Revenue (the difference between Tanshin
Slide 23: DGL (Europe)
2-7．DGL (Europe) (Billion yen) Results (Tanshin) Results (Non-GAAP) FY2022 FY2023 YoY FY2022 FY2023 YoY YoY Key one-off factors 4Q 4Q (％) 4Q 4Q (Amount) (％) (the difference between Tanshin and Non-GAAP excluding FX impact) *Please refer to “Breakdown of Adjustments” in the Reference Data section in
Slide 24: Americas
2-8．Americas (Billion yen) Results (Tanshin) Results (Non-GAAP) FY2022 FY2023 YoY FY2022 FY2023 YoY YoY 4Q 4Q (％) 4Q 4Q (Amount) (％) Automotive coatings 8.6 11.4 32.6% 8.6 10.7 2.1 24.8% Decorative paints 15.8 16.5 4.1% 15.8 15.8 -0.0 -0.2% Key one-off factors Revenue (the difference between Tanshin
Slide 25: Quarterly Financial Performance Trends in Major Segments
2-9. Quarterly Financial Performance Trends in Major Segments (For reference) Basic seasonal factors *Market-based High Low demand demand Demand tends to be lower in 1Q due to the deepening cold and in 3Q due to more intensely hot days that Japan Decorative 4Q > 2Q > 3Q > 1Q will slow construction p
Slide 26: FY2023 Results
((@)) NIPPON PAINT HOLDINGS CO, LTD. 3. FY2023 Results
Slide 27: Highlights (Consolidated)
3-1．Highlights (Consolidated) (Billion yen) Results (Tanshin) Results (Non-GAAP) YoY YoY YoY FY2022 *1 FY2023 FY2022 *1 FY2023 (％) (Amount) (％) Revenue 1,309.0 1,442.6 10.2% 1,308.0 1,418.3 110.3 8.4% Operating profit 111.9 168.7 50.8% 121.6 157.7 36.1 29.7% OP margin 8.5% 11.7% 3.2pp 9.3% 11.1% - 1
Slide 28: Highlights (by Segment)
3-2．Highlights (by Segment) (Billion yen) Results (Tanshin) Results (Non-GAAP) YoY YoY YoY FY2022 * FY2023 FY2022 * FY2023 (％) (Amount) (％) Revenue 186.1 201.5 8.3% 186.1 200.7 14.7 7.9% Japan Operating profit 5.3 19.2 261.9% 8.0 19.0 11.0 138.0% Revenue 708.5 771.5 8.9% 707.5 785.9 78.4 11.1% NIPSE
Slide 29: Revenue and Operating Profit Analysis
3-3．Revenue and Operating Profit Analysis (Billion yen) Paint and Coatings Business * Revenue Non-GAAP basis +8.4% (+110.3) Tanshin basis +10.2% (+133.6) Operating Profit Non-GAAP basis +36.1 29 *Products included in the Paint and Coatings Business such as semi-finished products and fine chemicals w
Slide 30: Japan & NIPSEA China
3-4．Japan & NIPSEA China (Billion yen) Results (Tanshin) Results (Non-GAAP) YoY YoY YoY FY2022 FY2023 FY2022 FY2023 (％) (Amount) (％) Automotive coatings 35.1 42.1 20.1% 35.1 42.1 7.1 20.1% Decorative paints 47.8 48.5 1.5% 47.8 48.5 0.7 1.5% Industrial coatings 40.0 39.7 -0.8% 40.0 39.7 -0.3 -0.8% Ja
Slide 31: NIPSEA Except China, PT Nipsea & Betek Boya
3-5．NIPSEA Except China & PT Nipsea (Indonesia) & Betek Boya (Türkiye) (Billion yen) Results (Tanshin) Results (Non-GAAP) YoY YoY YoY FY2022 FY2023 FY2022 FY2023 NIPSEA (％) (Amount) (％) Revenue 257.8 288.8 12.0% 257.8 313.4 55.7 21.6% Except China *1 Operating profit 37.8 50.2 33.0% 37.8 51.6 13.8 3
Slide 32: DGL (Pacific) & DGL (Europe)
3-6．DGL (Pacific) & DGL (Europe) (Billion yen) Results (Tanshin) Results (Non-GAAP) YoY YoY YoY FY2022 FY2023 FY2022 FY2023 (％) (Amount) (％) Decorative paints 104.6 113.4 8.4% 104.6 110.4 5.8 5.6% DGL Revenue Industrial coatings 9.1 9.6 5.2% 9.1 9.3 0.2 2.5% Adjacencies business 89.9 99.5 10.7% 89.9
Slide 33: Americas
3-7．Americas (Billion yen) Results (Tanshin) Results (Non-GAAP) YoY YoY YoY FY2022 FY2023 FY2022 FY2023 (％) (Amount) (％) Automotive coatings 32.3 40.9 26.7% 32.3 37.7 5.4 16.7% Decorative paints 65.7 66.4 1.1% 65.7 62.1 -3.6 -5.4% Revenue Fine chemicals 1.5 1.8 17.0% 1.5 1.7 0.1 9.5% Americas Total
Slide 34: Nippon Paint Holdings Investor Relations
NIPPON PAINT HOLDINGS CO., LTD. Investor Relations Email: ir_kouhou@nipponpaint.jp The forward-looking statements in this document are based on information available at the time of preparation and involve inherent risks and uncertainties. Accordingly, the actual results and performance of Nippon Pai
Slide 35: Reference Data
FY2023 4Q Financial Results Presentation Material Reference Data February 14, 2024 Nippon Paint Holdings Co., Ltd. ーContentsー 1. Trends in Consolidated Financial Results and Key Financial Data 2 2. Revenue & Operating Profit Transition by Segment 3 3. Revenue & Operating Profit Contribution from Dul
Slide 36: Trends in Consolidated Financial Results and Key Financial Data
1. Trends in Consolidated Financial Results and Key Financial Data <Consolidated earnings> (Billion yen) FY2021*1 FY2022*2 FY2023 1Q 2Q 3Q 4Q F/Y 1Q 2Q 3Q 4Q F/Y 1Q 2Q 3Q 4Q F/Y Revenue 222.7 259.1 254.5 262.0 998.3 285.1 337.0 357.9 329.1 1,309.0 330.2 362.7 393.0 356.7 1,442.6 Operating profit 24.
Slide 37: Revenue & Operating Profit Transition by Segment: Japan
2. Revenue & Operating Profit Transition by Segment *For the trends in earnings under the former reportable segments, please see the "Data by Segment" page of our IR website. ▶Data by Segment https://www.nipponpaint-holdings.com/en/ir/results/segment/ (Billion yen) FY2021*1 FY2022*2 FY2023 1Q 2Q 3Q
Slide 38: Revenue & Operating Profit Transition by Segment: NIPSEA
2. Revenue & Operating Profit Transition by Segment *For the trends in earnings under the former reportable segments, please see the "Data by Segment" page of our IR website. ▶Data by Segment https://www.nipponpaint-holdings.com/en/ir/results/segment/ (Billion yen) FY2021*1 FY2022*2 FY2023 1Q 2Q 3Q
Slide 39: Revenue & Operating Profit Contribution from DuluxGroup, Betek Boya and PT Nipsea
3. Revenue & Operating Profit Contribution from DuluxGroup, Betek Boya and PT Nipsea (Billion yen) FY2020*1 FY2021*1 FY2022*1 FY2023*1 1Q 2Q 3Q 4Q F/Y 1Q 2Q 3Q 4Q F/Y 1Q 2Q 3Q 4Q F/Y 1Q 2Q 3Q 4Q F/Y Revenue 31.8 35.0 40.3 41.2 148.3 41.5 42.7 43.6 48.5 176.2 68.0 79.1 84.5 83.3 314.9 81.7 89.0 95.5
Slide 40: Breakdown of Adjustments (FY2022 4Q vs. FY2023 4Q): Japan, DuluxGroup
4. Breakdown of Adjustments (FY2022 4Q vs. FY2023 4Q) FY2022 4Q FY2023 4Q M&A New M&A New (Billion yen) Subsidy, Impairment Credit loss Subsidy, Impairment Credit loss FX related acqui- Total FX related acqui- Total etc.*1 loss provision etc.*1 loss provision expenses sitions expenses sitions Automo
Slide 41: Breakdown of Adjustments (FY2022 4Q vs. FY2023 4Q): NIPSEA
4. Breakdown of Adjustments (FY2022 4Q vs. FY2023 4Q) FY2022 4Q FY2023 4Q M&A New M&A New (Billion yen) Subsidy, Impairment Credit loss Subsidy, Impairment Credit loss FX related acqui- Total FX related acqui- Total etc.*1 loss provision etc.*1 loss provision expenses sitions expenses sitions Automo
Slide 42: Breakdown of Adjustments (FY2022 vs. FY2023): Japan, DuluxGroup
5. Breakdown of Adjustments (FY2022 vs. FY2023) FY2022 FY2023 M&A New M&A New (Billion yen) Subsidy, Impairment Credit loss Subsidy, Impairment Credit loss FX related acqui- Total FX related acqui- Total etc.*1 loss provision etc.*1 loss provision expenses sitions expenses sitions Automotive - - - -
Slide 43: Breakdown of Adjustments (FY2022 vs. FY2023): NIPSEA
5. Breakdown of Adjustments (FY2022 vs. FY2023) FY2022 FY2023 M&A New M&A New (Billion yen) Subsidy, Impairment Credit loss Subsidy, Impairment Credit loss FX related acqui- Total FX related acqui- Total etc.*1 loss provision etc.*1 loss provision expenses sitions expenses sitions Automotive 0.7 - -