Mazda Motor Corp. · TSE:7261
Mazda Motor — H1 FY2004 Earnings Presentation
57 slides from Mazda Motor's earnings presentation, Nov 9, 2004
Slide 1: FY2004 First Half Results, Full Year Projections, Mid-term Plan
MAZDA MOTOR CORPORATION FY2004 FIRST HALF RESULTS FY2004 FULL YEAR PROJECTIONS MID- MID-TERM PLAN November 9, 2004 1 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 2: Introduction
INTRODUCTION FY2004 First Half z Operating Profit up 53% from Prior Year FY2004 Full Year z Operating Profit Outlook Raised to All-Time Record Mid-Term Plan “Mazda Momentum” 2 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 3: FY2004 First Half Results
FY2004 FIRST HALF RESULTS 3 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 4: First Half Financial Metrics
FIRST HALF FINANCIAL METRICS First Half Change (Billion yen) FY2004 FY2003 Amount Pct. Operating Profit 43.5 28.4 15.1 53 % Ordinary Profit 36.9 19.0 17.9 94 % Profit Before Tax 33.5 15.4 18.1 118 % Net Income 18.7 11.2 7.5 68 % Return on Sales 1.4% 0.9% 0.5 Pts - EPS (Yen/Share) 15.4 9.2 6.2 68 % 4
Slide 5: Cash Flow & Net Debt
CASH FLOW & NET DEBT FY2004 FY2003 B/(W) Prior (Billion yen) First Half Full Year Year End Cash Flow (14.0) 49.1 - Net Debt 363.3 358.1 (5.2) Net Debt-to-Equity 151% 161% 10 Pts Capital Spending 27.8 45.6 - 5 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 6: Key Assumptions
KEY ASSUMPTIONS First Half FY2004 FY2003 Change WHOLESALES (000) Consolidated 530 526 1 % REVENUE (¥Bils.) 1,320.6 1,209.5 9 % EXCHANGE RATES Yen / U.S. Dollar 110 118 ¥ (8) Yen / Euro 133 134 ¥ (1) 6 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 7: Revenue Changes by Destination
REVENUE CHANGES BY DESTINATION FY2004 First Half Compared with FY2003 First Half 15% 14% Vol. & Mix 11 % Exchange (2)% 10% 9% 5% 0% 0% Total Domestic Overseas (Billion yen) FY04 1H 1,320.6 411.5 909.1 FY03 1H 1,209.5 409.6 799.9 7 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Pla
Slide 8: Japan
JAPAN First Half FY2004 FY2003 Change Retail Volume (000) 135 134 1 % Market Share 5.0 % 4.9 % 0.1 Pts Successful Introduction of VERISA 8 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 9: United States
UNITED STATES First Half FY2004 FY2003 Change Retail Volume (000) 140 144 (3) % Market Share 1.6 % 1.6 % 0.0 Pts Strong Mazda3 Demand 9 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 10: Europe
EUROPE First Half FY2004 FY2003 Change Retail Volume (000) 143 119 20 % Market Share 1.6 % 1.4 % 0.2 Pts Record Sales in Four Countries 10 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 11: Operating Profit Changes
OPERATING PROFIT CHANGES FY2004 First Half Compared with FY2003 First Half Billion yen Strong Sales 40 Growth in Europe 30 26.3 18.2 20 15.1 10 0.2 0 (10) (2.6) (5.2) 28.4 3 1H FY0 43.5 4 1H FY0 (20) (21.8) (30) Total Vol & Exch. Product CR Mktg. Other Oper. Mix Enhanc. Exp. Costs 11 FY2004 1st Half
Slide 12: Operating Profit Changes
OPERATING PROFIT CHANGES FY2004 First Half Compared with FY2003 First Half Billion yen 40 US$ (3.4) 26.3 30 Other 0.8 18.2 20 15.1 10 0.2 0 (10) (2.6) (5.2) FY04 1H 43.5 (20) FY03 1H 28.4 (21.8) (30) Total Vol & Exch. Product CR Mktg. Other Oper. Mix Enhanc. Exp. Costs 12 FY2004 1st Half Results / F
Slide 13: Operating Profit Changes
OPERATING PROFIT CHANGES FY2004 First Half Compared with FY2003 First Half Billion yen Product Upgrades VE and Other 40 and Regulatory Product Cost 30 Actions 26.3 Reductions 18.2 20 15.1 10 0.2 0 (10) (2.6) (5.2) 28.4 3 1H FY0 43.5 4 1H FY0 (20) (21.8) (30) Total Vol & Exch. Product CR Mktg. Other
Slide 14: Operating Profit Changes
OPERATING PROFIT CHANGES FY2004 First Half Compared with FY2003 First Half Billion yen 40 R&D, Customer 30 26.3 Actions and 18.2 Other Costs 20 15.1 10 0.2 0 (10) (2.6) (5.2) 28.4 3 1H FY0 43.5 4 1H FY0 (20) (21.8) (30) Total Vol & Exch. Product CR Mktg. Other Oper. Mix Enhanc. Exp. Costs 14 FY2004
Slide 15: FY2004 Full Year Projections
FY2004 FULL YEAR PROJECTIONS 15 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 16: FY2004 Financial Metrics
FY2004 FINANCIAL METRICS Full Year Change (Billion yen) FY2004 FY2003 Amount Pct. Operating Profit 78.0 70.2 7.8 11 % Ordinary Profit 74.0 58.0 16.0 28 % Profit Before Tax 66.0 54.1 11.9 22 % Net Income 37.0 33.9 3.1 9% Return on Sales 1.4% 1.2% 0.2 Pts - EPS (Yen/Share) 30.4 27.8 2.6 9% 16 FY2004 1
Slide 17: Key Assumptions
KEY ASSUMPTIONS Full Year FY2004 FY2003 Change WHOLESALES (000) Consolidated 1,130 1,076 * 5 % REVENUE (¥Bils.) 2,710.0 2,574.7 * 5 % EXCHANGE RATES Yen / U.S. Dollar 107 113 ¥ (6) Yen / Euro 132 133 ¥ (1) * Restated on a 12-month Basis 17 FY2004 1st Half Results / FY2004 Full Year Projections / Mid
Slide 18: Revenue Changes by Destination
REVENUE CHANGES BY DESTINATION FY2004 Full Year Compared with FY2003 Full Year 10% Vol. & Mix 7 % 7% Exchange (2)% 5% 5% 2% 0% Total Domestic Overseas (Billion yen) FY04 2,710.0 860.0 1,850.0 FY03 2,574.7 846.2 1,728.5 18 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 19: Japan
JAPAN Full Year FY2004 FY2003 Change Retail Volume (000) 290 279 4 % Market Share 5.0 % 4.7 % 0.3 Pts VERISA and New PREMACY Introduction 19 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 20: United States
UNITED STATES Full Year FY2004 FY2003 Change Retail Volume (000) 275 273 1 % Market Share 1.7 % 1.6 % 0.1 Pts Accelerate Key Market Actions 20 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 21: Europe
EUROPE Full Year FY2004 FY2003 Change Retail Volume (000) 285 250 14 % Market Share 1.6 % 1.4 % 0.2 Pts Continued Strong Momentum 21 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 22: Operating Profit Changes
OPERATING PROFIT CHANGES FY2004 Full Year Compared with FY2003 Full Year Billion yen Wholesales up 5% 60 44.7 40 21.6 20 7.8 3.5 0 70.2 3 FY0 78.0 4 FY0 (20) (13.1) (19.8) (40) (29.1) Total Vol & Exch. Product CR Mktg. Other Oper. Mix Enhanc. Exp. Costs 22 FY2004 1st Half Results / FY2004 Full Year
Slide 23: Operating Profit Changes
OPERATING PROFIT CHANGES FY2004 Full Year Compared with FY2003 Full Year Billion yen 60 US$ (7.0) 44.7 40 Other (6.1) 21.6 20 7.8 3.5 0 70.2 3 FY0 78.0 4 FY0 (20) (13.1) (19.8) (40) (29.1) Total Vol & Exch. Product CR Mktg. Other Oper. Mix Enhanc. Exp. Costs 23 FY2004 1st Half Results / FY2004 Full
Slide 24: Operating Profit Changes
OPERATING PROFIT CHANGES FY2004 Full Year Compared with FY2003 Full Year Billion yen 60 VE and Other Product Upgrades 44.7 Product Cost and Regulatory 40 Actions Reductions 21.6 20 7.8 3.5 0 70.2 3 FY0 78.0 4 FY0 (20) (13.1) (19.8) (40) (29.1) Total Vol & Exch. Product CR Mktg. Other Oper. Mix Enhan
Slide 25: Operating Profit Changes
OPERATING PROFIT CHANGES FY2004 Full Year Compared with FY2003 Full Year Billion yen 60 44.7 R&D, Customer 40 Actions and Other Costs 21.6 20 7.8 3.5 0 70.2 3 FY0 78.0 4 FY0 (20) (13.1) (19.8) (40) (29.1) Total Vol & Exch. Product CR Mktg. Other Oper. Mix Enhanc. Exp. Costs 25 FY2004 1st Half Result
Slide 26: In Sum
IN SUM FY2004 FIRST HALF z Operating Profit up 53% from Prior Year z Strong Sales in Europe and China z Reopened Ujina No.2 FY2004 FULL YEAR z Operating Profit Outlook Raised to All-Time Record z Further Product Led Growth z ABC Cost Reduction Initiative Successful 26 FY2004 1 Half Results / FY2004
Slide 27: Mazda Momentum Mid-Term Plan
MAZDA MOMENTUM MID-TERM PLAN 27 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 28: Outline
OUTLINE Millennium Plan Status Long-Term Vision Mid-Term Plan z Commitments z Key Measures Close 28 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 29: Millennium Plan Status
MILLENNIUM PLAN STATUS 29 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 30: Growth – Operating Profit
GROWTH – OPERATING PROFIT Billion yen Wholesales (000) 78.0 70.2 FY2004 1,130 FY2000 964 50.6 28.5 0 (14.9) Strong Product Led Growth FY2000 FY2001 FY2002 FY2003 FY2004 30 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 31: Reform & Restructuring
REFORM & RESTRUCTURING Re-balancing of Production Capacity Reorganization of Subsidiaries ABC Cost Improvement Initiative 31 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 32: Ford Synergies
FORD SYNERGIES Joint Programs Share of Sales 50% Percent 10% FY2000 FY2004 32 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 33: People
PEOPLE Corporate Culture Change • Business Leadership Programs • 360o Peer Reviews People Development • Personnel Development Committees • Diversity Initiatives Employee Benefit Improvement • New Compensation System • Work-Life Balance 33 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-
Slide 34: Next Phase: Mazda Momentum
NEXT PHASE Mazda Momentum 34 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 35: Long-Term Vision
LONG- LONG-TERM VISION 35 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 36: Long-Term Vision
LONG- LONG-TERM VISION An automotive company that is respected and trusted by customers and stakeholders which: - Delights customers by providing leading-edge products and services with unique Mazda creativity reflecting Japanese heritage - Has a scale enabling global competitiveness Stakeholder Val
Slide 37: Growth & Value Creation
GROWTH & VALUE CREATION Brand Value Operating Margins Above 6% Financial Results Mazda Today Global Efficiency 37 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 38: Mazda Momentum Strategy
MAZDA MOMENTUM STRATEGY Profits Full Scale Growth Foundation Period Recovery Sustain Momentum Millennium Plan Mid-Term Plan Long-Term Vision 38 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 39: Mid-Term Commitments
MID- MID-TERM COMMITMENTS 39 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 40: Mazda Momentum
MAZDA MOMENTUM Establish Foundation for Full Scale Growth Sustain Sales & Profit Momentum Commitment & Execution 40 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 41: Mid-Term Plan Commitments
MID- MID-TERM PLAN COMMITMENTS FY2006 : Consolidated Wholesales 1,250,000 Operating Profit Over 100 Billion Yen Net Debt / Equity Ratio Below 100% 41 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 42: Key Measures
KEY MEASURES 42 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 43: Key Measures
KEY MEASURES Reinforce Research & Development Strengthen Key Markets Enhance Global Efficiencies and Synergies Leverage Human Resources 43 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 44: Reinforce Research & Development
REINFORCE RESEARCH & DEVELOPMENT Research & Development Spend • Product • Environment • Safety % 0 • IT +3 FY2003 FY2006 44 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 45: Mazda Environmental Pyramid
MAZDA ENVIRONMENTAL PYRAMID H2RE FCEV HEV Highly Efficient and Clean Engines Recycling 45 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 46: Expand Product Line-up
EXPAND PRODUCT LINE- LINE-UP Number of New Models 9 16 2001 - 2003 2004 - 2006 Phase 3 Phase 4 Full Freshening Market Focused Models of Core From Core Platforms Platforms 46 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 47: Strengthen Key Markets
STRENGHTEN KEY MARKETS Launch Market Focused Models Strengthen Distribution Exceed Customer Expectations 47 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 48: Japan
JAPAN Strengthen Momentum Introduce New Models • Including Mini-vans Tailored for Japan Reinforce Sales Network Actions • 30 New Car Outlets • 20 Used Car Outlets Customer Satisfaction Levels • Strong Dealer Focus 48 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 49: United States
UNITED STATES Accelerate Momentum Introduce Growth Segment Products • 3 Unique SUVs Actions Accelerate Dealer Exclusivity • 50% by 2006, Advanced by a Year Outstanding Ownership Experience • ‘Winner’s Circle’ Program 49 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 50: Europe
EUROPE Continue Momentum New European Focused Products • Mazda5, Diesel Engines, CO2 Actions Expand Distribution Network • Including Russia Long-Term Reliability • Build on Reputation 50 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 51: China / Other Key Markets
CHINA / OTHER KEY MARKETS Build Momentum China • Introduce Growth Segment Products • Establish Distribution Company Actions • Enter into Domestic Production Other Key Markets • Expand ASEAN Distribution • Growth in Other Key Markets 51 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-ter
Slide 52: Global Efficiencies and Synergies
GLOBAL EFFICIENCIES AND SYNERGIES Enhance Global Sourcing • Global Procurement Working with Ford Enhance Cost Innovation • Implement ABC Phase 2 Focused on Commodity Cycle Plans Enhance Supply Chain Management • Strengthen Global Logistics, Achieve Integrated Scheduled Production and Build-to-Order
Slide 53: People
PEOPLE Improve Management Skills • Further Develop Middle Management Leadership Skills • Accelerate Development of Next Generation Leaders Global People Development • Develop Employees with a Global Perspective Value Individual Creativity • Career Development and Flexible Work Environment Create Ene
Slide 54: Close
CLOSE 54 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 55: Mazda Momentum in Sum
MAZDA MOMENTUM IN SUM Establish Foundation for Full Scale Growth Sustained Sales & Profit Momentum Record Profits Commitment & Execution 55 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 56: 56 FY2004 1 st Half Results / FY2004 Full Year Projections / Mid-term Plan
56 FY2004 1st Half Results / FY2004 Full Year Projections / Mid-term Plan
Slide 57: Disclaimer
DISCLAIMER The projections for FY 2004 and future strategies shown in this presentation are based on various uncertainties including without limitation the conditions of the world economy in the future, the trend of the automotive industry and the risk of exchange-rate fluctuations. So, please be aw