Financial Results Explanatory Material
for 1Q FY2024
(Three months ended June 30, 2024)
TSE Prime Market, Securities code:6997
NIPPON CHEMI‐CON CORPORATION | August 2024 | 0 | ||||
1Q FY2024 Trend in Net Sales and Operating Margin
(Million yen) | Capital investments were sluggish amid increasing economic uncertainty | |
50,000 | 10.0% | |
41,137 | Net Sales | |||||
39,203 | Operating Margin | |||||
40,000 | 8.0% | |||||
35,680 | 34,718 | |||||
6.9% | ||||||
30,000 | 6.4% | 29,296 | 6.0% | |||
5.9% | 5.8% | |||||
20,000 | 4.0% | |||||
10,000 | 1.8% | 2.0% | ||||
0 | 0.0% | |||||
FY2023 | FY2024 | |||||
1Q | 2Q | 3Q | 4Q | 1Q | ||
NIPPON CHEMI‐CON CORPORATION | August 2024 | 1 |
1Q FY2024 - Results Overview
- Net Sales: Decreased 29% YoY to 29,200 million yen
- Automotive electronics market Stable growth in global demand
-
Industrial equipment market
Overall capital investment demand remained sluggish on economic downturn in China, etc. - ICT market
Demand recovery for data center servers Increased demand related to PC replacement needs
- Operating income: Decreased by 78% YoY to 500 million yen
- Capital investment demand was sluggish amid increasing economic uncertainty. No recovery on the industrial equipment market due to global interest rates remaining high and increasing geopolitical risks
NIPPON CHEMI‐CON CORPORATION | August 2024 | 2 | ||||
1Q FY2024: Consolidated Results (YoY)
Industrial equipment and home appliances markets remained stagnant | ||||||||||||
➡Recorded YoY decline in net sales and income | (Million yen, %) | |||||||||||
FY2023 | FY2024 | YoY | ||||||||||
1Q | 1Q | Change | % Change | |||||||||
Net Sales | 41,137 | 29,296 | -11,841 | -28.8% | ||||||||
Operating income | 2,413 | 520 | -1,892 | -78.4% | ||||||||
Ratio to net sales | 5.9％ | 1.8% | -4.1pt | - | ||||||||
Profit/loss attributable to | -13,827 | 451 | +14,278 | - | ||||||||
owners of parent | ||||||||||||
Ratio to net sales | -33.6% | 1.5% | +35.1pt | - | ||||||||
Capital investment | 1,501 | 3,582 | +2,081 | +138.6% | ||||||||
Depreciation and amortization | 1,532 | 1,596 | +64 | +4.2% | ||||||||
R&D expenses | 1,118 | 1,023 | -94 | -8.4% | ||||||||
Avg. exchange rate: USD (yen) | 137.37 | 155.88 | 13.5% weaker yen | |||||||||
EUR (yen) | 149.47 | 167.88 | 12.3% weaker yen | |||||||||
NIPPON CHEMI‐CON CORPORATION | August 2024 | 3 | ||||||||||
1Q FY2024: Net Sales by Market and by Region
- Percentage of Net Sales by Market
Automotive | Industrial | New | Home | ICT | Other | |
1Q FY2023 | electronics | equipment | energy | appliances | ||
23% | 7% | |||||
31% | 22% | 7% | 10% | |||
1Q FY2024 | 37% | 20% | 5% | 7% | 24% | 7% |
- Market Overview
Automotive electronics
Stable growth in global demand
Industrial equipment Capital investment demand remained sluggish
ICT
Recovery trend for PCs and servers
0% | 10% | 20% | 30% | 40% | 50% | 60% | 70% | 80% | 90% | 100% | ||||||||||||||
□Percentage of Net Sales by Region | ▢Regional overview | |||||||||||||||||||||||
Europe | ||||||||||||||||||||||||
1Q FY2023 | Greater China | Japan | Europe | Americas | Other | Downturn in economic recovery | ||||||||||||||||||
34% | 19% | 18% | 13% | 16% | due to declining consumer | |||||||||||||||||||
sentiment caused by prolonged | ||||||||||||||||||||||||
inflation and a slowdown in wage | ||||||||||||||||||||||||
increases due to an easing of the | ||||||||||||||||||||||||
1Q FY2024 | 37% | 21% | 12% | 12% | 18% | labor supply and demand balance | ||||||||||||||||||
Greater China | ||||||||||||||||||||||||
Recovery on buildup in ICT | ||||||||||||||||||||||||
0% | 10% | 20% | 30% | 40% | 50% | 60% | 70% | 80% | 90% | 100%markets | ||||||||||||||
NIPPON CHEMI‐CON CORPORATION | August 2024 | 4 | ||||||||||||||||||||||
1Q FY2024: Operating Income (YoY)
Downturn in operating income is mainly due to the impact | |
(Billion yen) | of decreased net sales |
NIPPON CHEMI‐CON CORPORATION | August 2024 | 5 | ||||
1Q FY2024: Net Sales by Product (YoY)
Industrial equipment and home appliances markets remained stagnant but the
ICT market shifted towards recovery trend from 1Q | (Million yen, %) | |||||||||||||||
FY2023 | FY2024 | YoY | ||||||||||||||
1Q | 1Q | |||||||||||||||
Amount | % of total | Amount | % of total | Change | % Change | |||||||||||
Aluminum | 36,855 | 89.6 | 25,377 | 86.6 | -11,477 | -31.1 | ||||||||||
electrolytic | ||||||||||||||||
Conductive | 5,293 | 12.9 | 4,910 | 16.8 | -382 | -7.2 | ||||||||||
polymer | ||||||||||||||||
DLCAP™ | 1,209 | 2.9 | 1,015 | 3.5 | -193 | -16.0 | ||||||||||
Ceramic capacitors, | 876 | 2.1 | 584 | 2.0 | -292 | -33.3 | ||||||||||
varistors | ||||||||||||||||
Mechanical parts | 844 | 2.0 | 752 | 2.6 | -92 | -10.9 | ||||||||||
and other parts | ||||||||||||||||
Capacitor | 1,056 | 2.6 | 1,271 | 4.3 | +215 | +20.4 | ||||||||||
materials | ||||||||||||||||
Other | 295 | 0.7 | 295 | 1.0 | -0 | -0.1 | ||||||||||
Total | 41,137 | 100.0 | 29,296 | 100.0 | -11,841 | -28.8 | ||||||||||
NIPPON CHEMI‐CON CORPORATION | August 2024 | 6 | ||||||||||||||
Future operating environment (Envisioned market rebound)
Overall, the business environment is developing on par with initial assumptions
On the ICT market, the recovery on the server market is faster than assumptions. Automotive electronics projected to recover from 2Q onward. Industrial equipment forecast to see a mild recovery from 2H onward.
Main markets | [INDEX: FY2022 = 100] | Outlook on changes in operating environment | |||
Automotive | 150 | ▢The number of vehicles is forecast to | |||
electronics | increase by 3% in 2024 to 89 million. | ||||
100 | ▢Progress on electrification, increasing use of | ||||
electronics. | |||||
50 | The number of components installed in | ||||
FY2022 | FY2023 | 1H | 2H | vehicles is forecast to increase by 7%. | |
FY2024 | FY2024 | ||||
Industrial | 150 | ▢Inventory adjustments by customers and | |||
distributors/agents | |||||
equipment | |||||
100 | ▢Forecasting mild recovery from 2H FY2024 | ||||
onward | |||||
50 | ▢Developments in investments in | ||||
FY2022 | FY2023 | 1H | 2H | semiconductors and labor-savings | |
FY2024 | FY2024 | ||||
150 | ▢PCs: Inventory adjustments came to an end, | ||||
ICT | rebound from 1Q | ||||
▢Servers | |||||
100 | |||||
Rapid growth in generative AI servers will | |||||
50 | continue. | ||||
Rebound in orders received from 1Q for | |||||
FY2022 | FY2023 | 1H | 2H | ||
FY2024 | FY2024 | conventional servers as well |
NIPPON CHEMI‐CON CORPORATION | August 2024 | 7 | ||||
FY2024: Consolidated Full-Year Forecast
No changes to full-year earnings forecast | |||||||||||||||
from figures announced in May | (Million yen, %) | ||||||||||||||
FY2023 | FY2024(Forecast) | YoY | |||||||||||||
Results | No change from | Change | % Change | ||||||||||||
figures announced | |||||||||||||||
in May | |||||||||||||||
Net Sales | 150,740 | 153,000 | +2,259 | +1.5% | |||||||||||
Operating income | 9,422 | 11,500 | +2,077 | +22.0% | |||||||||||
Ratio to net sales | 6.3% | 7.5% | +1.2pt | - | |||||||||||
Profit/loss attributable to owners | -21,291 | 7,400 | +28,691 | - | |||||||||||
of parent | |||||||||||||||
Ratio to net sales | -14.1% | 4.8% | +18.9pt | - | |||||||||||
Capital investment | 11,195 | 9,300 | -1,895 | -16.9% | |||||||||||
Depreciation and amortization | 6,339 | 6,700 | +360 | +5.7% | |||||||||||
R&D expenses | 4,489 | 4,500 | +11 | +0.2% | |||||||||||
Avg. exchange rate: USD (yen) | 144.62 | 145.00 | 0.3% weaker yen | ||||||||||||
EUR (yen) | 156.80 | 158.00 | 0.8% weaker yen | ||||||||||||
NIPPON CHEMI‐CON CORPORATION | August 2024 | 8 | |||||||||||||
Disclaimer
This material has been translated from the Japanese original for reference purposes only. In the event of any discrepancy between this translated document and the Japanese original, the original shall prevail.
The projected performance figures in this material are based on information available to Nippon Chemi-Con's management at the time this material was prepared.
There are many uncertain factors inherent in forecasting, and there might be cases in which actual results differ from forecast values. Nippon Chemi-Con undertakes no obligation to publicly update or revise any forward-looking statements included in this material. If you are interested in investing in Nippon Chemi-Con, you are requested to make a final investment decision at your own risk.
Please note that neither Nippon Chemi-Con nor any third party providing information shall be responsible for any damage or loss you may suffer due to investment in Nippon Chemi-Con based on the information shown in this material.
NIPPON CHEMI‐CON CORPORATION | August 2024 | 9 | ||||