Hanwa Co., Ltd. · TSE:8078
Hanwa — H1 FY2021 Earnings Presentation
31 slides from Hanwa's earnings presentation, Nov 18, 2021
Slide 1: Financial Results for the First Half of FY2021
Financial Results for the First Half of FY2021 November 2021 HANWA CO., LTD. Copyright© 2021 Hanwa Co., Ltd. All Rights Reserved
Slide 2: Operating Results (Consolidated)
Operating Results (Consolidated) H1 (ended September 30) FY2020 FY2021 Y on Y Y on Y (billions of yen) Change Rate Net Sales* 801.0 980.3 ー ー Gross Profit 35.4 57.5 +22.0 +62% SG&A 24.3 27.1 +2.7 +11% Operating income 11.0 30.4 +19.3 +175% Ordinary income 10.2 30.6 +20.3 +199% Net income attributabl
Slide 3: Changes in Business results (Consolidated)
Changes in Business results (Consolidated) ▸Net sales Applying the Accounting Standard ‣Net income attributable H2 (billions of yen) H2 for Revenue Recognition to owners of the Company H1 2,500.0 H1 34.5 (Forecast) 40.0 (Forecast) 2,500.0 2,074.6 2,000.0 (Forecast) 30.0 2,000.0 1,907.4 13.6 1,745.5
Slide 4: Effect of Profit/Loss from Market value Accounting and Temporary factors
Effect of Profit/Loss from Market value Accounting and Temporary factors (billions of yen) - ▸Reported ordinary income was 30.6 billion yen, but can be translated into about 28.2 billion yen after excluding one-time factors such as period-end valuation gains and losses for inventories, derivatives,
Slide 5: Segment Information (consolidated)
Segment Information (consolidated) ▸Net sales (billions of yen) H1 FY2020 H1 FY2021 980.3 1,000.0 801.0 600.0 422.8447.9 200.0 110.1 95.3 34.1 63.2 49.7 58.2 82.4127.0 87.4163.4 40.4 53.4 (200.0) (26.1) (28.4) ▸Segment income 40.0 30.6 30.0 18.2 20.0 10.2 10.0 6.7 2.1 3.5 3.2 0.3 1.5 3.0 3.0 0.6 2.5
Slide 6: Financial Position (consolidated)
Financial Position (consolidated) Consolidated Financial Position Mar-2021 Sep-21 Y on Y Y on Y (billions of yen) Change Rate Total assets 824.5 983.8 +159.4 +19% Total liabilities 632.7 0.0 764.1 +131.4 +21% Interst-bearing debt 301.6 386.2 +84.6 +28% Net DER 133% 152% +19pt - * 105% * 126% - - Net
Slide 7: Cash Flow Situation (consolidated)
Cash Flow Situation (consolidated) H１ (ended September 30) FY2020 FY2021 Y on Y Y on Y (billions of yen) Change Rate CF from operating activities 31.8 (66.1) (98.0) - CF from investing activities 1.1 (8.5) 0.0 (9.6) - FCF 32.9 (74.6) 0.0 (107.6) - CF from financing activities (22.1) 78.6 +100.8 - Ca
Slide 8: Business Forecast FY2021
Business Forecast FY2021 Fiscal Year (ending March 31) FY2020 FY2021 FY2021 Y on Y (billions of yen) (Actual) (Previous forecast) (Revised forecast) Rate 1,980.0 2,000.0 Net Sales* 1,745.5 (2,300.0) (2,500.0) - Operating income 29.2 42.0 52.0 +78% Ordinary income 28.8 0.0 38.0 0.0 50.0 0.0 +74% Net
Slide 9: Forecast of Segment Information
Forecast of Segment Information ▸Net sales FY2020 FY2021(Forecast) （billions of yen） 2,200.0 2,000.0 1,745.5 1,800.0 1,400.0 925.0 910.3 1,000.0 600.0 236.7 260.0 326.0 200.0 120.0 107.0 79.5120.0 100.4 183.0 204.8 87.8 200.0 (200.0) (57.3) (58.0) ▸Segment income 60.0 50.0 50.0 40.0 31.0 28.8 30.0 1
Slide 10: Dividend Policy
Dividend Policy 【Trend in dividend】 Interim dividends Year-end dividends Dividend payout ratio 180 50 150 Dividend payout ratio (%) 150 40 （44 ） 100 Dividends (yen) 120 75 100 (estimated) 30 90 25 60 50 20 60 30 75 75 10 30 (12) (12) (Dividend in the red) 30 50 0 0 FY2018 FY2019 FY2020 FY2021(estima
Slide 11: Steel Business Segment
Steel Business Segment H１（ended Sep 30） ▸Segment income increased, because FY2020 FY2021 Y on Y transaction volume increased thanks to Rate increased demand for steel, and earnings (billions of yen) margins extended as steel prices were on a Net Sales 422.8 447.9 ― rising trend. Segment Income 6.7 1
Slide 12: Primary Metal Business Segment
Primary Metal Business Segment H１（ended Sep 30） ▸Segment income increased, because FY2020 FY2021 Y on Y transaction volume of stainless steel and alloys (billions of yen) Rate remained strong as steel and non-ferrous- metal manufacturers resumed operation, and Net Sales 110.1 95.3 ― profit margin of
Slide 13: Metal Recycling Business Segment
Metal Recycling Business Segment H１（ended Sep 30） ▸Segment income increased, because profit FY2020 FY2021 Y on Y margin was secured by sales expansion of (billions of yen) Rate aluminum and copper as base metal prices rose globally, and transaction volume also increased Net Sales 34.1 63.2 +111100%
Slide 14: Foods Business Segment
Foods Business Segment H１（ended Sep 30） ▸Profit margin extended, because transaction FY2020 FY2021 Y on Y volume for mass merchandise outlets increased Rate and the product prices were on the rising trend. (billions of yen) In addition, improvement of profitability in Net Sales 49.7 58.2 ― subsidiar
Slide 15: Energy & Living Materials Business Segment
Energy & Living Materials Business Segment H１（ended Sep 30） ▸As market prices of crude oil and petroleum products were on upward trends, revenues FY2020 FY2021 Y on Y were secured in a stable manner and (billions of yen) Rate transaction volume of daily necessaries and Net Sales 82.4 127.0 ― househo
Slide 16: Overseas Sales Subsidiaries Segment
Overseas Sales Subsidiaries Segment H１（ended Sep 30） ▸Segment income increased, because transaction volume of steel increased in some FY2020 FY2021 Y on Y countries including Indonesia and Singapore, and (billions of yen) Rate improvement in profitability of the Food Net Sales 87.4 163.4 ― business
Slide 17: Other Segment
Other Segment H１（ended Sep 30） ▸In the Lumber business, segment income increased, because sales volume and products FY2020 FY2021 Y on Y line mainly targeting housing manufacturers (billions of yen) Rate increased, and revenue of the imported lumber Net Sales 40.4 53.4 ― products increased for the r
Slide 18: Transition of Quantitative Indicators
Transition of Quantitative Indicators Transition of Quantitative Indicators FY2020 FY2020 FY2021 FY2021 Achievement/ (H1) (H1) (Target) Progress Rate Net Sales (billions of yen) 801.0 1,745.5 980.3 2,000.0 49% Ordinary Income (billions of yen) 10.2 28.8 30.6 50.0 61% 137% 133% 152% Net DER* - - * 10
Slide 19: Profits of Group Companies
Profits of Group Companies 【Ordinary income trend of subsidiaries by business segment】 H１(ended Sep 30) FY2020 FY2021 Y on Y Change Consolidated/ Consolidated/ Consolidated/ (billions of yen) Equity method Unconsolidated Equity method Unconsolidated Equity method Unconsolidated Steel (0.7) (0.1) 4.5
Slide 20: Investment in business
Investment in business 【Current investment records】 Amounts Major investments (billions of yen) ・Enhancement of processing facilities at domestic Steel 2.3 and overseas subsidiaries ・Invested in field of compound, production for Primary Metal 0.5 rechargeable batteries Overseas sales subsidiaries 7.
Slide 21: Monetization of Investment
Monetization of Investment Generating steady earnings from strategic investments WATERBERG JV（Platinum group metals） ― Operations from 2024 BACANORA LITHIUM（Lithium carbonate) ― Operations from 2023/ production 18kt/year QMB NEW ENERGY（JV with CATL, Tsingshan Holdings, etc.） （Ni and Co compoun
Slide 22: Appendix
Appendix Copyright© 2021 Hanwa Co., Ltd. All Rights Reserved 21
Slide 23: Market Trend of Steel Raw Materials
Market Trend of Steel Raw Materials 【Transaction of steel raw materials price】 (US$/t FOB) iron ore spot price Coking coal spot price 450 iron ore benchmark price Coking coal benchmark price 400 350 300 250 200 150 100 50 0 ‣ Iron ore…Price started to drop since July this year when it was at the pea
Slide 24: Steel Market Trend in China
Steel Market Trend in China 【Transition of steel market in China】 12,000 Production of crude steel Market inventories 7,000 Market price of Rebar Market price of Hot coil 10,000 Production of crude steel, market inventories 6,000 8,000 Market price (RMB/ton) 5,000 (thousand ton) 6,000 4,000 4,000 3,
Slide 25: Market Trend of Steel Scrap
Market Trend of Steel Scrap 【Steel scrap and D-bar Market Price】 Steel scrap (H2) Market price of D-bar Maker's price of D-bar Composite 100 900 Steel scrap, D-bar(thousand yen/t) 90 800 composite price (US$/t) 80 700 70 60 600 50 500 40 400 30 300 20 10 200 0 100 ‣ Supply/Demand…The supply-demand g
Slide 26: Market Trend of Long Products
Market Trend of Long Products 【Transition of the H-Beams Markets in Japan】 240 Market inventories Market price Maker's price 110 200 Price (thousand yen/ton) 100 Volume (thousand ton) 160 90 120 80 80 40 70 0 60 ‣ Supply/Demand…Demand for construction of large-scale buildings such as distribution wa
Slide 27: Market Trend of Flat Products
Market Trend of Flat Products 【 Transition of Steel Sheets Markets in Japan 】 5,000 120 Market inventories Price of hot rolled sheet Price of hot rolled coil 110 Price (thousand yen/ton) Volume (thousand ton) 4,000 100 90 3,000 80 70 2,000 60 ‣ Supply/Demand…As production activities in the manufactu
Slide 28: Market Trend of Metals & Alloys
Market Trend of Metals & Alloys 180 5,300 FeSi($/t) Nickel($10/t) 4,800 MeSi($/t) Stainless scrap($/t) 160 (Ni, FeSi, MeSi, Stainless scrap) 4,300 FeCr(￠/lb) 3,800 140 3,300 (FeCr) 2,800 120 2,300 1,800 100 1,300 800 80 ‣ Nickel…Prices remained at a high level, because of underlying support by monet
Slide 29: Market Trend of Non-ferrous Metals
Market Trend of Non-ferrous Metals 3,400 11,000 Al Zn Pb Cu 10,000 3,000 Al, Zn, Pb (（US$/t) 9,000 2,600 Cu （US$/t) 8,000 7,000 2,200 6,000 1,800 5,000 1,400 4,000 ‣Aluminum …Prices remained at a high level, supported by concerns for supply in China, implementation of export tax in Russia, and produ
Slide 30: Market Trend of Frozen Marine Products
Market Trend of Frozen Marine Products Black-Tiger Salmon Horse mackerel Mackerel 3,300 1,000 Black-Tiger （yen/1.8kg） Salmon, Hose mackerel, Mackerel 3,100 800 2,900 600 (yen/kg) 2,700 400 2,500 200 2,300 0 ‣Salmon…Shipment for mass merchandise increased, supported by strong demand for home meal ami
Slide 31: Market Trend of Crude Oil & Petroleum Products
Market Trend of Crude Oil & Petroleum Products WTI DUBAI LSA(RIM) Gasoline(RIM) Bunker oil 140 500 Gasoline (thousand yen/KL） 450 120 Crude oil ($/BL),LSA・ 400 Bunker oil （$/mt) 100 350 80 300 250 60 200 40 150 100 20 50 0 0 ‣Crude oil…Price remained at a high level, supported by recovery of economi