MinebeaMitsumi Inc. · TSE:6479
MinebeaMitsumi — Q3 FY3/2017 Earnings Presentation
27 slides from MinebeaMitsumi's earnings presentation, Feb 13, 2017
Slide 1: Business Results Third Quarter of Fiscal Year Ending March 31, 2017
Business Results Third Quarter of Fiscal Year Ending March 31, 2017 MinebeaMitsumi Inc. February 13, 2017
Slide 2: Contents
Contents 1. Financial Results 2. Progress of Business Integration with MITSUMI ELECTRIC February 13, 2017 2
Slide 3: Financial Results
Financial Results Hiromi Yoda Director, Senior Managing Executive Officer February 13, 2017 3
Slide 4: Summary of Consolidated Business Results for 1Q-3Q
Minebea Summary of Consolidated Business Results for 1Q-3Q Businesses Sales & OP outperform target but down YoY due to stronger yen and sluggish smartphone market FY3/16 FY3/17 Change FY3/17 Nov. 2016 Forecast (Millions of yen) 1Q‐3Q 1Q‐3Q YoY Full Year Achievement Net sales 474,215 442,508 -6.7% 56
Slide 5: Summary of Consolidated Business Results for 3Q
Minebea Summary of Consolidated Business Results for 3Q Businesses Higher sales & OP QoQ due to seasonal uptick for smartphone components etc. FY3/16 FY3/17 Change (Millions of yen) 3Q 2Q 3Q YoY QoQ Net sales 178,661 154,844 167,375 -6.3% +8.1% Operating income 15,484 11,623 16,120 +4.1% +38.7% Ordi
Slide 6: Net Sales
Minebea Net Sales Businesses Quarterly （Billions of yen） 178.7 168.2 167.4 154.8 145.4 138.7 135.6 127.4 117.0 120.3 99.5 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q FY3/15 FY3/16 FY3/17 February 13, 2017 6
Slide 7: Operating Income
Minebea Operating Income Businesses Quarterly (Billions of yen) Operating income Operating margin 19.1 16.3 16.1 15.5 14.9 14.2 12.5 11.6 10.5 13.1% 8.5 12.2% 11.7% 10.6% 7.0 9.8% 9.6% 8.9% 8.7% 7.5% 6.3% 5.8% 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q FY3/15 FY3/16 FY3/17 February 13, 2017 7
Slide 8: Machined Components
Minebea Machined Components Businesses Quarterly Net sales (Billions of yen) Operating income (Billions of yen) Pivot assemblies Operating income Rod-ends/Fasteners Operating margin Ball bearings 41.9 42.3 41.0 40.8 26.1% 26.4% 26.0% 26.5% 40.2 39.8 39.2 25.1% 25.3% 24.7% 38.5 36.6 37.1 37.3 9.5 9.5
Slide 9: Electronic Devices & Components
Minebea Electronic Devices & Components Businesses Quarterly Net sales (Billions of yen) Operating income (Billions of yen) Other Operating income Sensing devices 137.8 Operating margin 0.7 11.1% Electronic devices 9.4 128.7 Motors 125.8 1.2 9.0% 8.9% 7.3% 0.7 8.5 6.5% 117.4 5.5% 5.5% 9.7 0.9 11.7 8
Slide 10: Net Income
Minebea Net Income Businesses Quarterly （Billions of yen） Net income Net income per share (yen) 13.2 11.8 12.2 11.0 10.1 9.6 8.9 32.4 7.7 6.8 35.2 6.8 31.6 29.4 26.9 23.8 25.5 20.6 18.3 3.2 18.2 8.5 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q FY3/15 FY3/16 FY3/17 February 13, 2017 10
Slide 11: S.G. & A. Expenses
Minebea S.G. & A. Expenses Businesses Quarterly (Billions of yen) S.G. & A. expenses S.G. & A. to sales ratio 18.4 18.7 18.3 18.1 17.4 17.4 17.0 15.4 15.9 14.9 13.8 14.5% 13.8% 13.3% 13.3% 12.8% 12.1% 11.5% 10.9% 10.6% 10.3% 10.4% 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q FY3/15 FY3/16 FY3/17 February 13, 20
Slide 12: Inventories
Minebea Inventories Businesses Quarterly (Billions of yen) 126.7 118.1 103.0 94.5 96.4 96.7 89.6 92.2 87.0 78.1 67.4 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q FY3/15 FY3/16 FY3/17 February 13, 2017 12
Slide 13: Capital Expenditure & Depreciation
Minebea Capital Expenditure & Depreciation Businesses Yearly (Billions of yen) 43.7 43.9 37.6 34.8 31.0 28.8 28.0 27.3 27.3 23.7 22.3 20.9 20.8 20.8 20.7 19.6 Mar.'11 Mar.'12 Mar.'13 Mar.'14 Mar.'15 Mar.'16 Mar.'17 Mar.'17 1Q-3Q Forecast Capital Expenditure (Forecast includes post- Depreciation & Am
Slide 14: Net Interest-Bearing Debt/Free Cash Flow
Minebea Net Interest-Bearing Debt/Free Cash Flow Businesses Yearly （ (Billions of yen) 136.2 *Net interest-bearing debt excludes 7.7 billion yen convertible bonds which was bought back in June 2016 and will be cancelled by the end of this fiscal year. 114.2 109.9 103.6 93.1 97.5 79.6 34.4 24.2 24.5
Slide 15: Investment to expand ball bearing production capacity
Investment to expand ball bearing production capacity Monthly External Ball Bearing Shipment Volume (million units/month) Demand for high-end ball • Internal sales of ball bearings mostly for bearings continues to grow HDD pivot assemblies recovered more than 180 expected. Shipments surpass producti
Slide 16: Progress of Business Integration with MITSUMI ELECTRIC
Progress of Business Integration with MITSUMI ELECTRIC Yoshihisa Kainuma Representative Director, President and Chief Executive Officer
Slide 17: Summary of MITSUMI ELECTRIC Results for 3Q
Summary of MITSUMI ELECTRIC Results for 3Q Although profits dropped significantly YoY/QoQ... FY3/16 FY3/17 Change (Millions of yen) 3Q 2Q 3Q YoY QoQ Net sales 40,368 44,632 47,834 +7,466 +3,202 Operating income -2,020 -1,500 -9,303 -7,283 -7,803 Ordinary income -4,371 -2,243 -7,236 -2,865 -4,993 Inc
Slide 18: Inventory write-downs & impairment losses
Inventory write-downs & impairment losses • MITSUMI ELECTRIC executed inventory evaluation in December quarter ahead of the business integration with former Minebea 12.3 billion yen inventory write-downs • 18.7 billion yen impairment losses Expecting 3 billion yen or more reduction in depreciation &
Slide 19: Summary of MITSUMI ELECTRIC Results for 3Q (adjusted)
Summary of MITSUMI ELECTRIC Results for 3Q (adjusted) Big improvement in profits after adjustment, excluding ¥12.3bn inventory write-downs and ¥18.7bn impairment losses FY3/16 FY3/17 Change (Millions of yen) 3Q 2Q 3Q 3Q Adjusted YoY QoQ Net sales 40,368 44,632 47,834 47,834 +7,466 +3,202 Operating i
Slide 20: Operating Income (MITSUMI ELECTRIC)
Operating Income (MITSUMI ELECTRIC) (Billions of yen) Operating income Operating margin Excluding ¥12.3bn of inventory 2.9 3.0 write-downs in 3Q 6.4% 1.1 6.3% 0.9 0.5 Adjusted OP hit ¥3.0bn 2.3% 2.2% -1.5 1.2% -1.7 in 3Q excluding -3.4% -2.0 -2.0 -3.3 -5.0% -5.0% -5.1% inventory -3.5 write-down -10.
Slide 21: Collaboration with MITSUMI - Improving productivity
Collaboration with MITSUMI - Improving productivity • Manufacturing support: Dispatched a cumulative total of 500 engineers from Minebea to MITSUMI to improve various mass production lines such as OIS, based on the business support agreement executed in August 2016 • Promoting the sharing of know-ho
Slide 22: Closing of share exchange
Closing of share exchange • Breakdown of share allotment: 20 million shares from treasury stock + approx. 28 million newly • MITSUMI ELECTRIC was issued shares delisted from the Tokyo Stock (Shareholders’ equity is expected to Exchange on January 24, 2017. increase by ¥15.4 billion yen in correspond
Slide 23: New Managements
New Managements • Three executives newly assigned from former Minebea to MITSUMI, a wholly owned subsidiary Director, Chariman Yoshihisa Kainuma Representative Director, Vice President Ryozo Iwaya Director, Vice President Shuji Uehara • Four executives to be newly assigned from MITSUMI to the parent
Slide 24: Forecast for Fiscal Year Ending March 31, 2017
Forecast for Fiscal Year Ending March 31, 2017 Upward revision due to better-than-plan 9 months results and consolidation of MITSUMI ELECTRIC from January 27, 2017 FY3/16 FY3/17 (Millions of yen) Full Year Full Year Full Year 1Q-3Q 4Q Forecast Revised YoY Nov. 16 Forecast Forecast Net sales 609,814
Slide 25: Forecast for Business Segment
Forecast for Business Segment FY3/16 FY3/17 (Millions of yen) Full Year Full Year 4Q Full Year 1Q-3Q Revised YoY Nov. '16 Forecast Forecast Forecast Net sales 609,814 442,508 187,492 630,000 +3.3% 560,000 Machined components 163,811 114,990 41,410 156,400 -4.5% 151,200 Electronic devices and compone
Slide 26: Share buyback and year-end dividend forecast
Share buyback and year-end dividend forecast • Resolution of share buyback (February 13, 2017) Number of shares: Up to 12 million shares (equal to 2.82% of total issued shares excluding treasury shares) Amount: Up to 15.0 billion yen Period: From February 14, 2017 to September 22, 2017 Purpose: To a
Slide 27: Business Results
Business Results MinebeaMitsumi Inc. http://www.minebeamitsumi.com/ Any statements in this presentation which are not historical are future projections based on certain assumptions and executive judgments drawn from currently available information. Please note that actual performance may vary signif