20200207 19 4Q IR Presentation slides for Web (E) Tom part … · 2020-02-20 · February 7, 2020 SUMIDA CORPORATION Performance Briefings

February 7, 2020

SUMIDA CORPORATION

Performance Briefings

<For FY2019 Q4 & Full-Year ending Dec. 31, 2019>

Today’s Speakers

2Copyright© 2018 SUMIDA CORPORATION. All rights reserved. 2

Representative Executive Officer and PresidentTomoharu Suseki

Representative Executive Officer and CFOYoshiyuki Honda

Today’s Program

Copyright© 2018 SUMIDA CORPORATION. All rights reserved. 3

1. FY2019 Q4 & Full-Year Performance Results

President Tomoharu SusekiＣＦＯ Yoshiyuki Honda

2. FY2020 Forecast

President Tomoharu SusekiCFO Yoshiyuki Honda

3. Q & A Session


FY2019 Q4 & Full-Year Performance Results

Tomoharu Suseki

President


FY2019 Q4 Performance Results

USD 112.93 110.23 110.45 107.32 108.57

Euro 129.67 125.71 123.74 120.20 119.76

Total Sales by Quarter

6

� Q4 sales declined from the same period of the previous year due to the influence of foreign exchange rates as well as to a slowdown in markets. But it nearly achieved the same level of sales as in Q3.

� Similarly to 2018, sales in the 2nd

half of 2019 were larger than in the 1st half.

253.1 232.0 231.7 240.4 238.7

120

2018 1Q

2019

2Q 3Q 4Q

（- 5.7%）

（Yen）

（100 million yen）

Copyright© 2020 SUMIDA CORPORATION. All rights reserved.

Sales by Market 2019 Q4 vs. 2018 Q4

7

Q4 automotive-related sales declined from the same period of the previous year partly due to influence of foreign exchange rates.

44.42 38.72

2018 4Q 2019 4Q

153.03 138.64

2018 4Q 2019 4Q

AutomotiveAutomotive- 9.4%

IndustryIndustry- 12.8%

55.70 61.35

2018 4Q 2019 4Q

Consumer ElectronicsConsumer Electronics＋ 10.1%



Q4 industrial-related sales declined from the same period of the previous year due to a slowdown in capital investments in China as well as to a decrease in RFID-related sales in Australia caused by the bush fires.

Consumer electronics-related sales significantly increased due to an expansion of share in smartphone-related market as well as to the launch of our new products.

101.25 92.01

2018 4Q 2019 4Q

Sales by Region 2019 Q4 vs. 2018 Q4

8

� Similarly to Q3, Q4 sales in Asia (Japan/Korea/Singapore) achieved almost the same level of sales as in the previous year. Q4 sales in China continued to be lower than in the previous year, but the margin of decrease became smaller.

� Q4 sales in North America declined from the same period of the previous year due to the negative impacts of GM strike that continued through the first half of Q4 as well as to a slowdown in automotive market.

� Q4 sales in Europe declined from the same period of the previous year due to the influence of foreign exchange rates as well as to a slowdown in automotive market.

50.28 50.21

2018 4Q 2019 4Q

Asia (excl. China/Taiwan)

- 0.1% 64.28 61.11

2018 4Q 2019 4Q

China/TaiwanChina/Taiwan

- 4.9％

37.34 35.39

2018 4Q 2019 4Q

North America/OthersNorth America/Others

- 5.2%

EuropeEurope

- 9.1%



Operating Income

9

� Q4 operating declined from the same period of the previous year, but the margin of decrease became smaller.

� Operating income in the 2nd half of 2019 significantly improved from the 1st half. Both amount and ratio of Q4 operating income improved from Q3.

� As production volume significantly declined from 2018 and fell below the plan, structural reforms are being undertaken.


6.0 5.2

11.6 12.5

1Q

2019

2Q 3Q 4Q


（- 19.5%）

Vs Previous YearVs Previous Year

15.6 12.5

4Q

2018

4Q

2019

Vs Previous QuartersVs Previous Quarters

10

FY2019 Full-Year Performance Results


� 2019 sales declined from 2018. However, with strong sales in the 2nd half, we were able to achieve the 2nd highest sales in 2019.

Total Sales

11

Stage I(2012-2014)

Stage II (2015-2017)

Stage III (2018-2021)

Master Plan


513

902 975 943

0

500

1000

2012 2013 2014 2015 2016 2017 2018 2019


617

570

2018

2019

176

167

2018

2019

183

206

2018

2019

60.4%17.8%

21.8%

Shares of sales in automotive and industrial markets had been on an expanding trend, but they shrank in 2019. On the other hand, a share of sales in consumer electronics market was recovered to more than 20%.

FY2019 Sales Breakdown

12

Share of Sales in 2019

Automotive

ConsumerElectronics

Industry

Automotive

Industry

(- 7.6%)

Consumer Electronics

(- 4.9%)

(+12.6%)



� We achieved the second highest sales in 2019. However, 2019 operating income significantly declined due to the following two reasons.

Unfavorable product (sales) mix

Fixed costs were not sufficiently recovered.

Operating Income

13

17.5

62.2

53.8

35.4

0

40

2012 2013 2014 2015 2016 2017 2018 2019

Stage I(2012-2014)

Stage II (2015-2017)

Stage III (2018-2021)

Master Plan


* 2016 IFRS basis

*


Analysis of FY2019 Operating Income

14



6.0 5.2

11.6 12.5 2.6% 2.3%

4.8%

5.3%

0%

2%

4%

6%

0

10

20

1Q

2019

2Q 3Q 4Q

� Unfavorable product (sales) mix Overall profitability was lowered because of a decrease of more profitable sales in automotive market and an increased of less profitable sales in consumer electronics market.

� Fixed costs were not sufficiently recoveredOur sales had been expanding through 2018 since the collapse of Lehman Brothers, and were planned to further expand in 2019 while fixed costs structure had been maintained based on this. As sales suddenly dropped in 2019 Q1, fixed costs were not sufficiently recovered. Therefore operating income in the 1st half of 2019 fell significantly. However, profitability started to rebound in Q4 with cost control initiatives taking effect.

Operating income ratio

Situation in Automotive Market

15

286

365

467

534 540

581

617

570

0

200

400

600

2012 2013 2014 2015 2016 2017 2018 2019

Stage I(2012-2014)

Stage II (2015-2017)

Stage III (2018-2021)

Master PlanCopyright© 2020 SUMIDA CORPORATION. All rights reserved.

� Automotive-related sales that had been steadily growing since the collapse of Lehman Brothers suddenly dropped in 2019. Its cause was a decline of our sales of existing automotive-related products. This was due to a global slowdown in car production in 2019.

� On the other hand, EV/HEV-related sales have steadily been expanding. This is because the number of EV/HEV production increased and we also won many new applications for EV/HEV. Further large growth in sales is expected.

� In addition to EV/HEV-related, new applications related to autonomousdriving are expected to start soon. Accordingly, our sales will be further expanding.

Sales （100 million yen）

Situation in Industrial Market

16

78

115

135 149

130

151

176 167

0

50

100

150

200

250

300

350

2012 2013 2014 2015 2016 2017 2018 2019


Stage I(2012-2014)

Stage II (2015-2017)

Stage III (2018-2021)

� Similarly to automotive-related sales, industrial-related sales had been expanding through 2018, but dropped in 2019.

� The major cause was that FA-related sales declined due to a slowdown in CAPEX in China. Another cause was customers’ production adjustment of RFID for traceability of livestock.

� In the meantime, development of new medical-related applications have been steadily progressing, which will contribute to our profits in the near future.

Master Plan


Situation in Consumer Electronics Market

17

149 159

174 179

140

169 183

206

0

50

100

150

200

250

300

350

2012 2013 2014 2015 2016 2017 2018 2019


Stage I(2012-2014)

Stage II (2015-2017)

Stage III (2018-2021)

Master Plan

� Expanding consumer electronics-related sales, one of the action plan items of Mid-Term Business Plan, has been progressing steadily. Its sales in 2019 exceeded 20 billion yen.

� We have been increasing market shares, by expanding sales channels of smartphone-related products, and by introducing our new products to the market as well.


New Products in Automotive Market

18Copyright© 2020 SUMIDA CORPORATION. All rights reserved.

New Products in Industrial and Consumer Electronics Markets


FY2019 Q4 & Full-YearConsolidated Financial Results

Yoshiyuki Honda

CFO


（単位：百万円）

Consolidated Quarterly Income Statement

21

Sales revenue declined from the previous year

FY2018.Q4（A）

FY2019.Q3（B)

FY2019.Q4（C）

Change %（C)/(A)

Change %（C）/(B)

S a l e s 25,314 24,040 23,871 △5.7％ △0.7％

G r o s s I n c o m e 4,089 3,521 3,491

GI % 16.2％ 14.6% 14.3％

O p e r a t i n g I n c o m e 1,559 1,163 1,254 △19.5％ 7.8％

OI % 6.2％ 4.8% 5.3％

F i n a n c i a l I n c o m e/ E x p e n s e s （ N e t ) △344 △297 △381

Income before Taxes 1,215 866 873 △28.1 0.8％

I n c o m e T a x e s △542 △204 7

Net Income Attributableto Owners of parent 661 648 815 23.3％ 25.8％

E P S （円） 24.68 23.90 30.05


（Million Yen）

Operating Income AnalysisFY2018 Q4 → FY2019 Q4

22

（Million yen）

Capacity utilization down & Unfavorable products mix in sales could not be covered by production efficiency up and other positive factors.

FY2018 Q4Operating Income1,559

Sales Down/Product Mix

-378

ProductionEfficiency

Up+301

China WagesUp-27

FOREXImpact

-26

Raw MaterialsReduction

+213

Costs in EuropeReduction

+108

R&D Exp.Up

-146

Others+36

2019 Q4OperatingIncome1,254

Exp.Reduction

+50

CapacityUtilization

Down-436


（単位：百万円）

Full-year Consolidated Income StatementFY2019 vs. FY2018

Sales as well as profits declined from the previous year.

23

FY2018（A）

FY2019（B)

Change %（B)/(A)

s a l e s 97,538 94,283 △3.3％

G r o s s I n c o m e 15,308 12,868

GI % 15.7％ 13.6％

O p e r a t i n g I n c o m e 5,383 3,543 △34.2％

OI % 5.5％ 3.8％

F i n a n c i a l I n c o m e/ E x p e n s e s （ N e t ) △1,321 △1,358

Income before Taxes 4,061 2,184 △46.2％

I n c o m e T a x e s △1,530 △588

Net Income Attributableto Owners of Parent 2,420 1,582 △34.6％

E P S （ y e n ） 90.24 58.36


(Million yen)

Operating Income AnalysisFY2018 Full Year → FY2019 Full Year

FOREXImpact+154

Pontiac Coil

+261

Capacity Utilization

Down-1,580

FY2018Full YearOperating Income5,383

(Million yen）

FY2019Full YearOperating Income3,543

Others-23

ProductionEfficiency

Up+561

RawMaterialsReduction

+592

Exp. Reduction

+426

R&D Exp.Up

-113

24

RevenueDown

/Product Mix-1,624

China Wages

Up-602


Costs in Europe

Reduction+108

Operating Income AnalysisFY2019 Full Year Plan → FY2019 Full Year Actual

25

FY2019Plan

Operating Income6,200

（Million yen）

FY2019Actual

Operating Income3,543

China Wages Reduction

+614

Others△35

Operating income was down from plan due to unfavorable product mix in sales & capacity utilization down

Revenue Down/Product Mix

-2,831

R&D Exp.Reduction

+472Exp.

Reduction+741

CapacityUtilization

Down-1,618


Consolidated Statement of Financial Position

Dec 31 2018

Dec 31 2019 Change

Current Assets 46,292 43,032 △3,260

Cash & Cash equivalent 4,098 3,286 △811

Trade & Other receivables 19,102 18,826 △275

Inventories 18,983 16,877 △2,106

Others 4,109 4,041 △67

Non-current Assets 47,984 53,528 5,544

Tangible Assets 33,754 35,668 1,913

Right of use Assets － 3,938 3,938

Goodwill 4,266 4,176 △89

Intangible Assets 6,183 6,151 △31

Deferred Assets 2,225 2,140 △85

Others 1,553 1,453 △100

TOTAL ASSETS 94,277 96,561 2,284

18年12月 19年12月

Current Ratio 1.54 1.40

Net DE Ratio 1.05 1.09

ＣＣＣ（days） 110 107

Dec 312018

Dec 312019 Change

Current Liabilities 30,155 30,630 474

Trade & Other liabilities 10,392 10,184 △208

Interest-bearing Loans 9,350 9,303 △46

Current Portion of Long-term Debts 6,038 6,367 329

Current portion of Lease 152 807 654Others 4,222 3,967 △254

Non-current Liabilities 28,682 31,337 2,654Interest-bearing Loans 24,280 23,707 △573Lease Liabilities 386 3,462 3,076Others 4,016 4,166 150

TOTAL LIABILITIES 58,838 61,967 3,128TOTAL NET EQUITY 35,438 34,593 △844

Equity Attributable to Equity Holders of Parent 33,829 33,013 △815

Minority Interest 1,609 1,579 △29TOTAL LIABILITIES & EQUITY 94,277 96,561 2,284

FOREX USD/Yen 110.21 108.66

Euro/Yen 126.15 121.83

Renminbi/Yen 16.01 15.54

（Million yen）


Decline of working capital & newly-added lease liabilities

Statement of Consolidated Cash Flow

2018Jan. 1 – Dec. 31

2019Jan. 1 – Dec. 31 Change

Cash Flow from Operating Activities 4,672 8,732 4,060

Income before Taxes 4,061 2,184 △1,877

Depreciation & Amortization 4,045 5,309 1,264

Net Working Capital △3,289 1,772 5,061

Others △145 △534 △388

Cash Flow from Investing Activities △15,152 △8,133 △7,019

Capital Investments △8,441 △7,353 1,088

Acquisition of Subsidiary Stocks △5,991 － 5,991

Others △720 △780 △59

Cash Flow from Financing Activities 9,477 △1,261 △10,738

Net Interest-bearing Loans 5,756 552 5,203Revenue from Issuance of Other

Equity Instruments

5,000 － △5,000

Dividend Payment △1,202 △731 470

Repayment of Lease Liabilities △96 △878 △782

Others 19 △203 △223

Cash & Cash Equivalent at End Of Period 4,098 △1,261 △811

（Million yen)

Cash flow from operating activities increased due to decline of net working capital.27Copyright© 2020 SUMIDA CORPORATION. All rights reserved.


FY2020 Forecast

Tomoharu Suseki President

Outlook for FY2020

29

� In automotive market, demands for existing products are recovering slowly. However, demands for EV/HEV-related products are expected to significantly expand as environmental issues would become more and more highlighted.

� In consumer electronics and industrial markets, 5G/IoT-related sales are expected to be growing largely. However, the increase will be limited in a single year 2020.

� To prepare for a full-scale recovery from 2021 onwards, structural reforms will be implemented in 2020, for which 500 million yen has been earmarked in 2020 business plan. Even with that expense included, both sales and profit for 2020 will be improved from the previous year.


� Both sales and operating income are expected to grow from the previous year.

� Operating income is expected to exceed 4.5 billion yen. However, the amount has been changed to 4 billion yen with planning to spend 500 million yen for the structural reforms to ensure future growth.

Forecast Sales and Profit in FY2020

30


975.4 942.8 960.0

0

20

40

60

80

100

100

500

900

2018 2019 2020


Sales

Operating Incom

e

53.8

35.440.0

Plan

Forecast Capital Investments in FY2020


41.3%

11.6%

39.8%

7.3%

30.6

84.4

73.5

89.0

0

20

40

60

80

100

2012 2013 2014 2015 2016 2017 2018 2019 2020 As many new products are planned to be introduced in 2020, CAPEX will be made based on the Mid-Term Business Plan

New products

Increase ofproduction

Production efficiency

Others

Stage I(2012-2014)

Stage II (2015-2017)

Stage III (2018-2021)

Master Plan

Plan



FY2020 Forecast

Yoshiyuki Honda

CFO

Forecast Consolidated P/L in FY2020

FY2019 FY2020 Change（％）

S a l e s 94,283 96,000 1.8％

O p e r a t i n g I n c o m e 3,543 4,000 12.9％

OI % 3.8％ 4.2％

I n c o m e b e f o r e T a x e s 2,184 2,800 28.1％

Net Income Attributable toO w n e r s o f P a r e n t 1,582 2,000 26.4％

E P S ( y e n ) 58.36 73.67Foreign Exchange Rates

USD/Yen 109.15 108.00Euro/Yen 122.35 119.00Euro/Yen 15.81 15.00

（million yen）

Automotive business continues to be unpredictable assuming slow recovery of demands


FY2019

3,543

FY2020

Forecast

4,000

Plus Factors

Costs reduction 1,248

Production efficiency 986

Increased revenue & products mix 584

Foreign exchange 238

Personnel cuts 128

TOTAL PLUS FACTORS 3,184

Minus Factors

Wage & social welfare increase △1,067

Salary increase △843

Structural reform expenses △500

Price cuts demanded by customers △281

TOTAL MINUS FACTORS △2,691

Others △36

TOTAL NET 457

Operating Income Analysis FY2020 vs. FY2019

（Million yen）

34

Operating income is expected to be 4,000 million yen including 500 million-yen structural reform exp.


457

（Million yen）

Disclaimer Regarding Forward Looking Statements


Sumida Corporation (referred to as "Sumida") makes this document available for informational

purposes only. This document contains certain “forward-looking statements” which reflect

management’s current views and the assumptions made with respect to specific future events

and financial performance. Such statements are based on currently available information, and

by their nature are subject to various risks and uncertainties that could cause actual results to

differ materially from those projected or implied in “forward-looking statements” and from

historical trends.

These risks include but are not limited to domestic and global economic business conditions,

successful execution of our strategy and our ability to realise the resulting benefits, our ability

to develop and market new products, changes in legislation, legal claims, changes in exchange

and interest rates, changes in tax rates, actuarial assumptions, raw materials and employee

costs, our ability to restructure our operations, the rate of technological changes, political,

economic and other developments in countries where Sumida operates, industry consolidation

and competition. As a result, Sumida’s actual future results may differ materially from the plans,

goals and expectations set forth in such forward-looking statements. Sumida is under no

obligation to, and expressly disclaims any obligations to, update or alter its forward-looking

statements, whether as a result of new information, subsequent or otherwise.

Sumida is under no liability of any person in respect of any loss and damage which may be

suffered or incurred or which may arise directly or indirectly in respect of information contained.

All rights, including, but not limited to the copyright, reserved. No part of this document may be

reproduced in any means without the prior written permission of Sumida.

20200207 19 4Q IR Presentation slides for Web (E) Tom part … · 2020-02-20 · February 7, 2020 SUMIDA CORPORATION Performance Briefings

Documents