Daido Metal Co., Ltd.TSE: 7245

FY2020 First Quarter Consolidated Financial Results Highlights

· Issued by Daido Metal Co., Ltd.

August 7, 2020

Daido Metal Co., Ltd.

FY2020 First Quarter Consolidated Financial Results Highlights

1．Overview

1st Quarter (YTD)

Actual

Financial Results

2019/6

2020/6

Net sales

25,482

18,870

Operating profit

1,144

- 1,054

(Operating margin)

(4.5%)

(-5.6%)

Ordinary profit

1,075

- 1,403

(Ordinary income margin)

(4.2%)

(-7.4%)

Profit attributable to owners of parent

498

- 1,151

(Net profit margin)

(2.0%)

(-6.1%)

Return on Equity (ROE) ＊1

3.5%

- 8.4%

Net assets to total assets

35.0%

33.1%

Net interest bearing debt

40,981

37,334

Capital Expenditure

2,438

1,688

Depreciation

2,207

2,088

R&D expenses

500

451

Number of consolidated subsidiaries

33

33

Exchange rate (USD)

110.99

108.83

Exchange rate (EUR)

124.56

119.55

＊1 Annualized

(Unit: JPY Million)

Year-on-year comparison

Amount

%

- 6,611

- 25.9%

- 2,199

-

(-10.1%)

-

- 2,479

-

(-11.7%)

-

- 1,650

-

(-8.1%)

-

- 12.0%

-

- 1.9%

-

- 3,647

- 8.9%

- 750

-30.8%

- 119

-5.4%

- 49

-9.8%

0

-

Exchange rate is TTM rate as of March 31.

≪Causes of Fluctuation in Operating profit≫

≪Dividend/ Dividend Payout Ratio≫

(Unit: JPYBillion)

The forecast of dividends for the fiscal year ending March 31,

2021 is not available at this moment.

(Unit: JPY)

2017/3

2018/3

2019/3

2020/3

2021/3

Interim

15

15

15

＊20

Year-end

15

15

15

15

Not

available

Annual

30

30

30

35

Dividend

54.0%

33.3%

32.0%

60.1%

Payout Ratio

＊ The interim dividend for FY2019

: Regular dividend (15 yen) + Commemorative dividend (5 yen)

≪Forecast of FY2021 financial results≫

As for Consolidated Financial Results for full year, forecast is not available at this moment due to uncertain circumstances caused by the worldwide spread of the new coronavirus (COVID-19). Consolidated Financial Results Forecast for full year will be announced when more detailed information is available.

2．Consolidated Financial Results/Capital Expenditure and Depreciation

(Unit: JPYBillion)

(Unit: JPYBillion)

(Unit: JPYBillion)

(Unit: JPYBillion)

Net sales

Operating profit/Operating margin

Ordinary profit/Ordinary income margin

Capital Expenditure/Depreciation

106.6

107.7

8.0

7.2

Operating profit

Ordinary profit

Capital Expenditure

Depreciation

100.1

6.6

Operating margin

12.0%

8.0

6.8

Ordinary income margin

7.0

7.0

6.6

12.0%

12.3

85.0

6.0

10.0%

6.0

10.8

9.5

4.7

5.0

10.0%

8.6

8.7

8.5

5.0

4.1

5.0

7.2

8.0%

3.6

6.7

4.0

6.7%

8.0%

4.0

3.0

6.0%

6.4%

6.2%

6.0%

3.0

6.2%

5.9%

1.6

2.0

2.0

2.0

5.5%

1.0

4.0%

1.0

4.0%

18.8

4.2%

3.7%

Capital Expenditure

Depreciation

Capital Expenditure

Depreciation

Capital Expenditure

Depreciation

Capital Expenditure

Depreciation

Capital Expenditure

Depreciation

0.0

2.0%

0.0

2.0%

-1.0

-1.0

(1.0)

-5.6%

-7.4%

-1.4

-2.0

0.0%

(2.0)

0.0%

2017/3

2018/3

2019/3

2020/3

2020/6

2017/3

2018/3

2019/3

2020/3

2020/6

2017/3

2018/3

2019/3

2020/3

2020/6

2017/3

2018/3

2019/3

2020/3

2020/6

- 1 -

3．Sales and Operating profit by Segment

(before elimination of inter-segment transactions)

Operating profit or loss

Net sales

（

Unit: JPYBillion）

（Unit: JPYBillion）

1.6

Net sales

Operating profit or loss

15

14.4

10.4

1.5

10

0.7

1.0

5

0.3

4.5

3.4

0.3

0.3

3.7

0.5

0.2

2.4

2.5

2.2

0.1

0.1

0.6

0.5

0

0.0

-0.01

-0.5

-0.6

-1.0

2019/6

2020/6

2019/6

2020/6

2019/6

2020/6

2019/6

2020/6

2019/6

2020/6

Automotive

*

Automotive

Non-automotive

Other automotive parts

Others

engine bearings

non-engine bearings

bearings

* "Others"includes electrode sheets for electric double layer capacitors, themetallicdry bearings business, pump-related products businesses, and real estateleasing.

4．Sales and Operating profit by Region

(before elimination of internal transactions)

Net sales

Operating profit or loss

（Unit: JPYBillion）

（Unit: JPYBillion）

17

17.0

12.2

Net sales

Operating profit or loss

1.1

12

7.2

0.6

7

0.4

5.3

3.3 0.2

3.0

3.5

2

0.2

0.001

0.08

2.7

0.02

0.1

-0.1

-0.4

-0.9

-1.2

-1.4

2019/6

2020/6

2019/6

2020/6

2019/6

2020/6

2019/6

2020/6

Asia

North America

Europe

Japan

August 7, 2020

Daido Metal Co., Ltd.

[Sales]

(+)Gains (-)Losses

(Unit: JPY Million)

[Operating profit] (+)Gains (-)Losses (Unit: JPY Million)

Ne t s ale s ratio

Year-on-year

Year-on-year

comparison

comparison

Segment

Causes of Gains and Losses

Causes of Gains and Losses

2020/6

Amount

Amount

(%)

(%)

(-)Japan: Significant decrease of production adjustments by passenger car

manufacturers due to COVID-19

(-)Japan: Continued decrease in demand from trucks for exports(Mainly for

(-)Decrease due to COVID-19

Southeast Asia and Indonesia)

Automotive

- 3,916

- 1,273

(+)Korea : Profit increase due to increased sales

54.3%

(-)Orders decrease for turbocharger bearings

engine bearings

(-27.2%)

(-77.3%)

/Recovered earnings

(-)China: Significant decrease by production adjustments due to COVID-19

(-)Thailand: Significant decrease of the domestic market shrink and

decrease in exports to overseas from Thailand

(+)Korea: Increase orders for small SUVs

Automotive

- 1,121

(-)Japan,China: Significant decrease of production adjustments by auto

- 460

17.8%

parts manufacturers due to COVID-19

(-)Decrease due to COVID-19

non-engine bearings

(-24.6%)

(-63.4%)

(-)Europe: Decrease in sales due to Dieselgate issue

(-)Decrease due to falling demand for low-speed diesel engines bearings

Non-automotive

99

(+)Development of ship-related businesses overseas (China and Korea)

0

(-)Decrease of low-speed diesel engines bearings

13.4%

(-)Weak demand from construction machinery sector in overseas market

bearings

(4.0%)

( - )

(+)Increase for energy sector

(China, North America, Asia)

(+)Increase orders of steam turbines for the energy sector

(-)Iino Group: Decrease due to COVID-19 globally

(-)Iino Group: Decrease due to COVID-19

Other automotive

11.7%

- 1,525

(-)Weak demand of Thailand's auto industry, decrease for alminum die

- 647

(-)Decrease in sales alminum die cast products due to

parts

(-40.2%)

cast products by the suspension of plant operations due to COVID-19 and

( - )

COVID-19 incl, increasing depreciation for DMCT

significant decrease in automobile exports to overseas from Thailand

(New factory for alminum die cast parts in Thailand)

Others

2.7%

- 96

(-)Demand decrease for special types of bearings from general industory

- 31

(-)Decrease due to COVID-19

(-15.5%)

sector

(-23.5%)

Elimination of

- 50

215

inter-segment transactions

Total

- 6,611

(-)Fluctuations in exchange rate

- 2,199

(-25.9%)

( - )

[Sales]

(+)Gains (-)Losses

(Unit: JPY Million)

[Operating profit] (+)Gains (-)Losses (Unit: JPY Million)

Ne t sale s ratio

Year-on-year

Year-on-year

comparison

comparison

Region

Causes of Gains and Losses

Causes of Gains and Losses

2020/6

Amount

Amount

(%)

(%)

(-)Japan: Significant decrease of production adjustments by passenger car

manufacturers due to COVID-19

(-)Continued decrease in demand from trucks for exports (Mainly for

(-)Decrease due to COVID-19

Southeast Asia and Indonesia)

- 4,888

- 1,546

(-)Decrease of material exports to overseas subsidiaries

Japan

52.3%

(-)Orders decrease for turbocharger bearings

(-28.6%)

(-)

due to demand decrease

(-)Decrease due to falling demand for low-speed diesel engines bearings

(-)Weak demand from construction machinery sector in overseas market

(China,North America, Asia)

(-)Iino: Substantial decrease by production adjustment due to COVID-19

(+)Korea : Profit increase due to increased sales /Recovered

(-)China: Significant decrease by production adjustments due to COVID-19

earnings

(-)Thailand: Significant decrease of the domestic market shrink

(+)Korea: Increase orders for small SUVs

- 1,921

- 659

and decrease in exports to overseas from Thailand due to

Asia

23.0%

(-)Weak demand from Thailand's auto industry, decrease for alminum die

(-26.4%)

(-)

COVID-19

cast products by the suspension of plant operations due to COVID-19 and

(-)Decrease in sales alminum die cast products due to

significant decrease in automobile exports to overseas from Thailand

COVID-19 incl, increasing depreciation for DMCT (New

factory for alminum die cast parts in Thailand)

- 378

(-)Decrease by production adjustments due to COVID-19 and decrease in

- 252

North America

12.9%

sales related to construction machinery

(-)Decrease due to COVID-19

(-11.2%)

(-99.3%)

(-)Iino Group: Decrease by production adjustments due to COVID-19

Europe

- 797

(-)Decrease due to Dieselgates issue

-64

(-)Decrease in automobile-related sales due to Dieselgate

11.9%

(-)Decrease in sales for turbocharger bearings

issue

(including Russia)

( - )

(-76.4%)

(+)Increased orders in Russia

(+)Russia: Increase in sales

Elimination of

1,374

324

internal transactions

Total

- 6,611

(-)Fluctuations in exchange rate

- 2,199

(-25.9%)

(-)

- 2 -