Kaga Electronics Co., Ltd. · TSE:8154

Kaga Electronics — H1 FY2021/3 Earnings Presentation

48 slides from Kaga Electronics's earnings presentation, Nov 26, 2020

  1. Slide 1: KAGA ELECTRONICS Financial Results Briefing Material First Half FY March 2021

    For Institutional Investors/Analystss KAGA ELECTRONICS Financial Results Briefing Material for the First Half of the Fiscal Year ending March 2021 加賀電子株式会社 KAGA ELECTRONICS CO., LTD. CO., LTD. November 26, 2020 TSE 1st section 8154

  2. Slide 2: INDEX

    INDEX  FY2021/3 First Half Financial Results P-2～ Summary/Financial Highlights/ Effect of M&A/ Financial Highlights by Business Segment/ Balance Sheet/Cash Flows  Management Topics P-27～ Response to the Spread of covid-19 Infection/ Acquisition of Kyokuto Electric / Progress of PMI ・・Fujitsu Elect

  3. Slide 3: Consolidated Financial Results for the First Half of FY ending March 2021

    Consolidated Financial Results for the First Half of the Fiscal Year ending March 2021 Managing Director KAGA ELECTRONICS CO., LTD. Eiji Kawamura 2

  4. Slide 4: Summary of Financial Results for the First Half Ended September 30, 2020

    Summary of Financial Results for the First Half Ended September 30, 2020  Although PC sales grew due to the growing utilization of remote work during the coronavirus outbreak, net sales fell as a result of a significant impact from changes FY2021/ 2Q in commercial rights and commercial distribution

  5. Slide 5: Financial Highlights

    Financial Highlights （million yen） FY2020/3 FY2021/3 FY2021/3 Progress 2Q Results 2Q Results YoY Forecasrt rate Net Sales 230,630 188,859 -18.1% 40,000 47.2% Gross Profit 23,771 10.3% 21,641 11.5% -9.0% ー ー ー SG&A 18,531 8.0% 17,206 9.1% -7.1% ー ー ー Operating income 5,239 2.3% 4,434 2.3% -15.4% 5,00

  6. Slide 6: Financial Results by Business Segment for FY2021/3 2Q

    Financial Results by Business Segment for FY2021/3 2Q （million yen） FY2020/3 FY2021/3 2Q Results 2Q Results YoY Electronic Net sales 199,818 156,887 -21.5% Component Segment income 4,238 2.1% 3,083 2.0% -27.3% Information Net sales 19,968 23,192 16.1% Equipment Segment income 618 3.1% 1,160 5.0% 87.

  7. Slide 7: Effect of M&A (FY2021/3 2Q Results)

    Effect of M&A (FY2021/3 2Q Results) （million yen） Net Sales Gross profit / Gross profit margin Sales decline at Kaga Electronics due to COVID-19. Although income was down for both Kaga Electronics Fujitsu Electronics records heavy drop in sales due to loss and Fujitsu Electronics, the gross profit m

  8. Slide 8: FY2021/3 2Q results by company

    FY2021/3 2Q results by company （million yen） 2020/3 2021/3 2Q Results 2Q Results YoY Net sales 119,415 110,535 -7.4% Kaga Electronics Gross Profit 16,347 13.7% 15,853 14.3% -3.0% operating income 3,952 3.3% 4,619 4.2% 16.9% Net sales 111,214 59,720 -46.3% Fujitsu Electronics Gross Profit 7,418 6.7%

  9. Slide 9: Financial Highlights: Electronic Component Segment

    Financial Highlights: Electronic Component Segment （Million Yen） Net sales/Segment income YoY  Net Sales - 42,931million yen 21.5％Down 199,818  Segment income - 1,155million yen 27.3％Down 156,887 ・The components sales business benefited from the effect of Excel’s consolidation, but sales fell due

  10. Slide 10: Financial Highlights: Information Equipment Segment

    Financial Highlights: Information Equipment Segment （Million Yen） Net sales/Segment income YoY  Net Sales +3,223million yen 16.1%Up 24000 5000 23,192 4500  Segment income +542million yen 87.8%Up 22000 4000 19,968 ・Sales of PCs and PC peripherals to home appliance stores, schools and educational fa

  11. Slide 11: Financial Highlights (3 months)

    Financial Highlights （3months） （million yen） FY2020/3 FY2021/3 FY2021/3 YoY QoQ 2QResults 1QResults 2QResults Net Sales 121,066 84,130 104,729 -13.5% 24.5% Gross Profit 12,708 10.5% 9,997 11.9% 11,643 11.1% -8.4% 16.5% SG&A 9,319 7.7% 8,341 9.9% 8,864 8.5% -4.9% 6.3% Operating income 3,389 2.8% 1,65

  12. Slide 12: Financial Results by Business Segment for FY2021/3 2Q (3 months)

    Financial Results by Business Segment for FY2021/3 2Q(3months) （million yen） FY2020/3 FY2021/3 FY2021/3 YoY QoQ 2QResults 1QResults 2QResults Electronic Net sales 105,230 68,196 88,690 -15.7% 30.1% Component Segment income 2,617 2.5% 1,185 1.7% 1,897 2.1% -27.5% 60.0% Information Net sales 9,842 12,

  13. Slide 13: Effect of M&A (FY2021/3 2Q Results, 3 months)

    Effect of M&A (FY2021/3 2Q Results, 3months） （million yen） Net Sales Gross profit / Gross profit margin Fujitsu Electronics continued to heavy drop in sales Kaga Electronics improved sales mix and gross due to loss of large commercial rights. profit declined limitedly. 121,066 ▲3,702 ▲28,773 ＋16,139

  14. Slide 14: FY2021/3 2Q results by company (3 months)

    FY2021/3 2Q results by company（３months） （million yen） FY2020/3 FY2021/3 FY2021/3 YoY QoQ 2QResults 1QResults 2QResults Net sales 61,744 52,493 58,041 ー6% 10.6% Kaga Electronics Gross Profit 8,540 13.8% 7,442 14.2% 8,410 14.5% ー1.5% 13.0% operating inc 2,335 3.8% 1,870 3.6% 2,749 4.7% 17.7% 47.0% Net

  15. Slide 15: Financial Highlights: Electronic Component Segment (3 months)

    Financial Highlights: Electronic Component Segment(3months） （million Yen） Net sales/Segment income YoY 120000 / Net Sales 8000  Net Sales - 16,539million yen 15.7％Down / Segment income  Segment income - 720million yen 27.5％Down 105,230 7000 100000 88,690 QoQ 6000 +20,494million yen 30.1％Up 80000 6

  16. Slide 16: Financial Highlights: Information Equipment Segment (3 months)

    Financial Highlights: Information Equipment Segment （3months） （million yen） Net sales/Segment income YoY / Net Sales  Net Sales 4000 ＋811million yen 8.2％Up 16000 / Segment Income  Segment income ＋148million yen 34.6％Up 3500 14000 12,537 QoQ 3000  Net Sales - 1,882million yen 15.0％Down 12000 10,65

  17. Slide 17: Balance Sheet Main Items

    Balance Sheet Main Items （million Yen） Total assets Total liabilities and net assets 214,475 214,475 207,638 209,908 209,908 207,638 Total liabilities 129,008 113,745 121,388 Current assets 182,133 174,331 172,376 Total net assets 96,163 85,466 86,250 Non-current assets 32,341 33,306 37,532 2019/9 2

  18. Slide 18: Balance Sheet Main Items

    Balance Sheet Main Items （millon yen, day） Inventories Accounts receivable/Accounts payable 160,000 89.0 90.0 77.4 75.2 A/R turnover 36.6 50.0 27.6 26.3 Inventory turnover 140,000 50,000 70.0 68.9 67.0 A/P turnover 61.1 120,000 37,729 50.0 97,510 0.0 34,792 40,000 91,864 100,000 31,908 91,371 30.0 7

  19. Slide 19: Cash and Deposits/Interest Bearing Debt/Cash Flows

    Cash and Deposits/Interest Bearing Debt/Cash FlowsBalance （ Million Yen） Cash and Deposits/Interest Bearing Debt Cash flows 0.45 （times） 60,000 0.37 0.44 0.50 D/E ratio 0.04 -0.11 -0.19 0.00 50,000 Net D/E ratio -0 . 50 22,406 40,000 Cash and deposits -1 . 00 11,684 30,000 -1 . 50 42,931 43,384 39,1

  20. Slide 20: Supplementary information on cash flow

    Supplementary information on cash flow Cash flow from operating activities recorded a temporary increase in outflow in FY2020/9 due to the acquisition of Excel, loss of large commercial rights and the impact of COVID-19, but is expected to reverse within FY2021/3. Main variation items FY2019/9 FY202

  21. Slide 21: Forecast for the Fiscal Year ending March, 2021

    Forecast for the Fiscal Year ending March, 2021 （Million Yen） FY2020/3 FY2021/3 FY2021/3 Changes YoY Results Initial forecast Current forecast （announced on August 6, 2020） Net sales 443,615 400,000 410,000 2.5% -7.6% Operating income 10,014 2.3% 5,000 1.3% 7,500 1.8% 50.0% -25.1% Ordinary income 10

  22. Slide 22: Breakdown of revised forecasts for FY2021/3

    Breakdown of revised forecasts for FY2021/3 （million yen） Previous forecast Revised forecast  Kaga Electronics Before 240,000 -5,000 235,000 COVID-19  Fujitsu Electronis 160,000 -35,000 125,000 Pandemic  Excel 450,000 50,000 50,000 Net Sales  Risks due to COVID-19 -50,000 （-40,000） Total 400,000

  23. Slide 23: Segment disclosure associated with the Medium-Term Management Plan

    Segment disclosure associated of the Medium-Term Reference Management Plan Continuous disclosure based on current segmentation according to legal financial accounting, along with voluntary disclosure based on segmentation in line with the new Medium-Term Management Plan Current segments Segments in

  24. Slide 24: Business segments of Parent company and Group companies

    Business segments of Parent company and Reference Group companies Electronic EMS CSI Others Components KAGA ELECTRONICS CO., LTD. Electronics Business Division ● ● (●) ● EMS Business Division ● Communication Network Sales Division ● ● ● (●) Specific Industry Business Division ● ● (●) ● Sales Promoti

  25. Slide 25: Financial Highlights by Business Segment of the Medium-Term Management Plan

    Financial Highlights by Business Segment of Reference the Medium-Term Management Plan （Million Yen) FY2020/3 FY2021/3 YoY 2Q Results 2Q Results Electronic Net sales 156,803 117,287 -25.2% Componens Segment income 2,127 1.4% 851 0.7% -60.0% Net sales 46,945 42,940 -8.5% EMS Segment income 2,100 4.5%

  26. Slide 26: Financial Highlights by Business Segment of the Medium-Term Management Plan (3 months)

    Financial Highlights by Business Segment of Reference the Medium-Term Management Plan(3months) （Million Yen） FY2020/3 FY2021/3 YoY 2Q Results 2Q Results Electronic Net sales 84,698 67,547 -20.2% Componens Segment income 1,651 2.0% 807 1.2% -51.1% Net sales 22,425 23,120 3.1% EMS Segment income 830 3

  27. Slide 27: Forecasts by Business Segment of the Medium-Term Management Plan

    Forecasts by Business Segment of the Medium-Term Management Plan （million yen） FY2020/3 FY2021/3 YoY Results Forecasts Electronic Net sales 292,905 264,000 -9.9% Componens Segment income 3,553 1.2% 2,000 0.8% -43.7% Net sales 93,340 85,000 -8.9% EMS Segment income 4,015 4.3% 3,000 3.5% -25.3% Net sa

  28. Slide 28: Management Topics

    Management Topics President & Representative Director KAGA ELECTRONICS CO., LTD. Ryoichi Kado 27

  29. Slide 29: Response to the Spread of Novel Coronavirus Infection

    Response to the Spread of Novel Coronavirus Infection ・We continued with marketing activities while implementing safety measures in Japan and overseas, such as telework and staggered work times, in line with guidance from the central and local governments. Number of Apr. May June July Aug. Sept. Sal

  30. Slide 30: Acquisition of Kyokuto Electric

    Acquisition of Kyokuto Electric Name ・ Kyokuto Electric Co., Ltd. ・ Representative Director and Chairman : Motonori Toshinari （Director, Division Manager of EMS Business Division of Outline of Representative KAGA ELECTRONICS） Kyokuto ・ Representative Director and President : Yasuhiro Sawada （present

  31. Slide 31: Progress of PMI at Fujitsu Electronics

    Progress of PMI at Fujitsu Electronics  Obtained orders for development, experimental production and mass production from five companies, including automotive equipment EMS manufacturers and electronics manufacturers 84 companies/new visits ➡ 40 companies/currently in sales talks initiatives <Focus

  32. Slide 32: Progress of PMI at Kaga EMS Towada

    Progress of PMI at Kaga EMS Towada(Former Towada Pioneer ） ・ Start of mass production of electronic boards for Japanese tier-1 companies (from July 2020) Automotive Bring in new ・ Mass production orders of electronic boards for Japanese customers tier-1 companies (from November 2021) Office ・ Mass p

  33. Slide 33: Progress of PMI at EXCEL

    Progress of PMI at EXCEL  Expanded sales of photocatalytic sanitizer/deodorizer* manufactured by Kaltech Co., Ltd.  Expanded sales of EV buses manufactured by China’s Alfabus Co., Ltd. New business <Focus point> Initiatives Utilization and full-scale deployment of networks owned by Kaga Electronic

  34. Slide 34: Kaltech's photocatalytic sanitizer/deodorizer

    Kaltech’s photocatalytic sanitizer/deodorizer Portable air purifier ※カルテック社ホームページより Wall Mounted type (hanging type） ※From Kaltech’s website About Kaltech Co., Ltd. Kaltech’s photocatalytic technology  Kaltech is a venture company set up by  By radiating visible LED at a a former Sharp engineers i

  35. Slide 35: Sustainability initiatives

    Sustainability initiatives New businesses Outside collaborations Helicopter business Venture investment ・Disaster prevention ・Resolution of social issues applications for public agencies Collaboration Medical equipment between business business and academia ・CT scanners/CT ・Development of energy -sa

  36. Slide 36: New Initiatives: Sustainability

    New Initiatives: Sustainability Wearable Device and Support of Medical equipment × QOL People with Disabilities Breast cancer CT scanner Mobile CT scanner ONTENNA Care Support System Green Capacitor “Watch-Over” System in an Aging Breakthrough × Next-generation Society battery storage devices 35

  37. Slide 37: Reference

    Refelence 36

  38. Slide 38: Financial Highlights by Business Segment (Net Sales)

    Financial Highlights by Business Segment① （Net Sales） （million yen） Net 売上高Sales 121,066 Total YoY ： -16,336 109,564 5,097 108,170 QoQ ： +20,599 895 104,813 104,729 4,412 9,842 4,185 437 455 6,085 4,600 10,126 783 Othe 9,820 990 84,130 10,654 YoY ： -497 13,677 QoQ ： +1,696 2,904 491 12,537 Software

  39. Slide 39: Financial Highlights by Business Segment (Segment Income)

    Financial Highlights by Business Segment② （Segment Income） （million yen） Segment Income Total YoY ： -610 QoQ ： +1,122 3,389 186 Other 108 2,778 YoY ： -48 2,492 QoQ ： +239 429 137 105 2,282 131 1,850 Software 236 87 577 YoY ： ＋22 72 226 1,656 QoQ ： ＋176 188 853 583 Information equipment 2,617 YoY ： +

  40. Slide 40: Net Sales by Region

    Net Sales by Region （million yen） Net Sales YoY  Japan - 15,227million yen 20.8％Down 121,066  North America - 2,777million yen 42.1％Down  Europe - 1,431million yen 23.4％Down 104,729  Asia ＋3,099million yen 8.9％Up 84,130 73,370［60.6%］ 58,143 [55.5%] QoQ Japan  Japan ＋4,809million yen 9.0％Up 53,3

  41. Slide 41: Exchange Rate/FOREX Sensitivity

    Exchange Rate/FOREX Sensitivity （Reference） Effect of 1% change （million yen） Forex FY2020/3 FY2021/3 assumption 2Q Results 2Q Results Net Sales Ordinary for FY2021/3 （yen） （yen） income (yen) USD 108.63 106.92 649 19 105.50 THB 3.49 3.38 90 2 3.50 RMB 16.20 15.39 524 3 15.00 HKD 13.86 13.80 482 2 13

  42. Slide 42: memo

    <memo> KAGA ELECTRONICS 41

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    < memo > KAGA ELECTRONICS 42

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    <memo> KAGA ELECTRONICS 43

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    < memo > KAGA ELECTRONICS 44

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    < memo > KAGA ELECTRONICS 45

  47. Slide 47: Everything we do is for our customers

    “Everything we do is for our customers 20 Kandamatsunagacho, Chiyoda-ku, Tokyo 101-8629 Contact: Investor Relations & Public Relations Office TEL:+81-3-5657-0106 FAX:+81-3-3254-7133 E-mail： webmaster@taxan.co.jp https://www.taxan.co.jp/en/

  48. Slide 48: Forward-looking statements

    ■ Forward-looking statements in these materials are based on information available to management at the time this report was prepared and assumptions that management believes are reasonable. Actual results may differ significantly from these statements for a number of reasons. ■ Display method in th

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