New Mid-Term Management Plan “ASAHI Road to 1000” Aiming to be a Strong Global Niche No. 1 Company with Unique Technology (Security code: 7747 Second Section of the Tokyo Stock Exchange. Second Section of the Nagoya Stock Exchange) Asahi Intecc Co., Ltd. August 10, 2018
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New Mid-Term Management Plan “ASAHI Road to 1000”
Aiming to be a Strong Global Niche No. 1 Company with Unique Technology
(Security code: 7747 Second Section of the Tokyo Stock Exchange. Second Section of the Nagoya Stock Exchange)
Review of the Previous Mid-Term Management Plan -2 (FYE June 2015 ~ FYE June 2018)
Achievement of R&D / production system Decision to construct a new building to expand R&D base and strengthen business cooperation
(Scheduled to be completed in December 2018)
Decision to establish “Tohoku R&D” as the center of development for high-precision processing techniques (Started operations in July 2018)
Promoting decentralization to improve production efficiency and BCP compliance
— Construction of a new medical factory to enable production of medical devices at Cebu factory (Started operation in October 2017)
Achievement of partnership / M & A strategy Business partnership with Boston Scientific Corporation (August 2014~)
—Started selling pressure guide wires, a jointly developed product for FFR (fractional flow reserve) (July 2016)
Stock acquisition and absorption merger with limited company Meisen (May 2015)
— Further strengthened wire forming technology by incorporating a company that manufactures high-performance stranding machines
Conversion of Nihon Chemical Coat Co., Ltd. to a subsidiary (August 2017)
— Pursue synergy between our "stainless steel processing technology" and the company's "Fluororesin Coating Technology“
Capital business partnership with Fuji Co., Ltd. (November 2017)
— Joint research and development for creating next-generation medical devices in the catheter intervention field with the company (Industrial Robot Manufacturer)
Aiming to be a Strong Global Niche No. 1 Company with Unique Technology
Always pursue performance and quality sought by the top 20% of the world Realize product fields that competitors cannot develop or imitate, create a global niche
market and establish No. 1 domain
[What we have] Our own materials Difficult for other companies to replicate Our own elemental technology Able to meet various needs Corporate culture
Accommodate any request Keep thinking until a solution is found Always striving for the top (Pursuit of performance and quality ) Endless quest
Not just possessing "proprietary technology / original products / top-share products," but continuing to be a company with characteristics that can be boasted of to the world from the
viewpoints of temperament and corporate culture which underlie the company
Positioning of New Mid-Term Management Plan - 2 (FYE June 2019 ~ FYE June 2023)
Maintain and improve No. 1 position in PTCA guide wire Increase share of catheter field (Penetrating Catheter, Balloon,
Guiding) Further increase market share in the US, where we shifted to a
direct sales structure Strengthen sales structure in rapidly expanding Chinese market Shift to direct sales in some parts of Europe and Asia Strengthen sales structure in areas of Peripheral and Neuro
Develop Global Market Strategically and Expand Affected /Treatment Area
Exploration of advanced technology and integration with in-house technology
Advance into the gastrointestinal field Advance into robotics field Advance into other global niche fields
Create new business in global niche market
Strengthen profitability of existing business
Culmination of existing basic
strategies
1
Sowing for the future Investment for growth
Create new businesses 2
Establish business portfolio to achieve sales revenue of 100 billion yen
Develop Global Market Strategically and Expand Affected /Treatment Area
Create New Business in Global Niche Market
Develop R&D and Production System Optimized for Global Expansion
Establish Management Foundation for Sustainable Growth
1
2
3
4
(Plan)
Consolidated Sales
80 billion yen
Operating margin
25%
Aiming to be a Strong Global Niche No. 1 Company with Unique Technology
Net Sales (Mil. Yen)
(*) In FYE June 2012, a temporary decrease in sales and profit occurred due to reduced production. The reason for such was that our main factory of our consolidated subsidiary company, Asahi Intecc Thailand was forced to suspend operations temporarily when flooding hit Thailand at that time.
Net Sales: 80 billion Yen Operating Income: 20 billion yen
(Plan)
Mid-Term Management Plan: Profit Goals to FYE June 2023 Net sales (Mil. Yen)
Operating income (Mil. Yen)
(*) In FYE June 2012, a temporary decrease in sales and profit occurred due to reduced production. The reason for such was that our main factory of our consolidated subsidiary company, Asahi Intecc Thailand was forced to suspend operations temporarily when flooding hit Thailand at that time.
Entire product line-ups were switched to direct sales from June 30, 2014. Aim at further share expansion through direct sales permeation.
Dist. Direct Sales (from Jan. 2012) Direct Sales (from June 30, 2014) Direct Sales (from July 2013)
US
PTCA-GW under long-term contract with Abbott Vascular (~June, 2018). Plan to strengthen products other than cardiovascular products.
Dist. ABBOTT→Direct Sales (from July 2018) Direct Sales Direct Sales
(from July 2015 ) Direct Sales Direct Sales
EU/ Middle
East
Distribution agent changed from Abbott to local distributors in July 2011. Seeking market share in PTCA-GW market.
Dist. Local Dist. → Direct sales planned for some areas
Asia (inc.
China)
Increase share in cardiovascular products and promote other treatment areas. Along with market expansion, distributor business to be further emphasized, taking into consideration decentralized distribution.
Expand sales by switching to direct sales in the US Each area (EU, Asia, China, South America): Re-establish sales network to correspond to local market features
Direct sales by area Establishment of a Russian base
Multiple-agent system Correspondence to Two Invoices System
Direct sales by area Strengthen sales in India / South Korea / Taiwan / Indonesia
To date, Asahi Intecc Group’s flagship product line of PTCA guide wires has been sold by Abbott Laboratories (Abbott) in the U.S. ASHAI INTECC USA, INC., a wholly owned subsidiary of the Asahi Intecc Group, began direct sales of PTCA guide wires for hospitals as of July 1, 2018.
Overview of Retro Vascular,Inc. Location 5976 W. Las Positas Blvd. Suite 120, Pleasanton, California 94588, U.S.A.
Title and name of representative President & CEO Wayne Ogata
Description of business Life science development
Capital (Including additional paid in
capital)
Common stock: 127 thousand US dollars (14 million yen) Series A preferred stock: 499 thousand US dollars (54 million yen) Series B preferred stock: 2,050 thousand US dollars (225 million yen) Total: 2,677 thousand US dollars (294 million yen)
Date of establishment March 27, 2006
Acquisition price Common stock: 22,154 thousand US dollars (2,436 million yen) Preferred stock: 3,725 thousand US dollars (409 million yen) Total (estimated amount): 25,879 thousand US dollars (2,846 million yen)
Date of Resolution Resolution at Board of Directors’ meeting: July 6, 2018 Execution of share transfer: July 6, 2018
Amount of goodwill 2,841 Mil. Yen(Approximate amount)(Scheduled to be amortized for 20 years)
26
The Acquisition of Shares of Retro Vascular(Conversion to Sub-subsidiary ) Disclosed in July 6, 2018
ASAHI INTECC USA, INC., a 100% subsidiary of Asahi Intecc, acquired shares of Retro Vascular,
Inc. that was a R&D-type company in the United States and made Retro Vascular its subsidiary (sub-subsidiary of Asahi Intecc)
In recent years, Retro has been also working on the development of plasma energy technology using electrical energy aiming at further improvement of treatment results in the PTCA treatment and is in the process of establishing the basic technology
It is possible to use Retro as the base for gathering and surveying most-advanced information because the company is based on the Silicon Valley which is the center of cutting-edge and advanced medical device innovation in the world
Establishment of Tohoku R&D Center Started operations on July 2, 2018
By pursuing high-precision processing techniques, we will further improve the development capabilities of next-generation medical devices and expect to contribute to the development of medical devices as No. 1 and unique products
Medical device development utilizing injection molding and high-precision processing techniques
Newly opened as a central base for development of high-precision processing techniques such as casting and injection molding
Toyoflex Towada Factory Relocation of
techniques High-precision processing
techniques (casting and injection molding techniques)
Construction of Global Headquarters and R&D Center Scheduled to be Completed in December 2018
New building to be
constructed
To be used as is
New warehouse to be demolished
Backyard/loading dock
Build a soundproof wall
Access way
Access way for employees (planned)
Front gate
Demolish the office building and
construct a new parking lot
Catheter surgery simulation room Prevent X-ray radiation from from leaking to
the surrounding rooms by embedding lead boards into the walls and ceiling
<Layout Plan of R&D Base> R&D Environment Similar to Clinical Practices
Construction of new building within the premises of the Seto factory and R&D base
Enhancement of R&D functions Promote strengthening and efficiency of business by transferring and
consolidating the head office functions The new building was completed in July 2018
We will demolish the existing administrative building and construct an access way ahead of relocating our headquarters and starting full-scale operation in December 2018
Implemented restructuring of production bases to improve production efficiency and realize decentralization for BCP
In areas requiring local production, consider establishing new production bases closely tied to the areas and in line with local regulations
Mass production / Increase production efficiency Development / Prototyping / Production transfer
Cebu Factory (Philippines)
Pursue production efficiency as “Mass production factory”
Establish system that can produce medical devices by constructing a new medical factory
<Medical factory>
Thailand Factory Shifted to new development base with roles of
“Rolling-up development system” and “Smooth production transfer of development project,” from conventional “Mass production / Trial production factory"
Hanoi Factory (Vietnam) Pursue production efficiency as “Mass
production factory” Plan to utilize the remaining capacity of the
new factory for further mass production
Japan Expand prototype line for passing on
technology Maintain production back-up system in
case of emergency although R&D is the main body
< Global Headquarters and R&D Center> <Tohoku R&D Center>
Development of Production System Optimized for Global Expansion
Approach to ESG (Environment, Society, Governance)
Optimization of production bases
assuming risk management (BCP)
Strengthening corporate governance
Reduce the physical, mental and economic
burden of patients Solve social issues through business
Approach to Environment, Health and Safety
Strengthen management foundation
Contribute to curbing medical expenses
Environmental policy
Responding to legal regulations
Quality Assurance System
Strengthening global human resource base
Request for reduction of environmental burden
Policies for curbing medical expenses in each country
Legal regulation
Need for safe and secure products
Risks in disasters and emergencies
Social significance of business based on long-term
management vision
G E S
Promoting diversity
Penetration of human resources vision
Reform of personnel system
In addition to consideration for the environment and society, we will strengthen our human resource management and governance to bolster the management foundation and technology base and establish a system that can secure profitability at a global scale
Title and name of representative Representative Director: Nobutoshi Hirota
Description of business Welfare service business for people with disabilities
Capital 40 Mil. Yen
Date of establishment December 7, 2011
Acquisition price Common stock: 40 Mil. Yen Advisory expenses etc. (estimated amount): 0 Mil. Yen Total (estimated amount): 40 Mil. Yen
Date of Resolution Resolution at Board of Directors’ meeting: July 12, 2018 Execution of share transfer: July 12, 2018
Promote the activities of people with disabilities Ficas Co., Ltd. is a company that has been certified as providing “Continuous Support for
Employment (type A)" in providing people with disabilities opportunities for work as well as in conducting training, etc. necessary for improving knowledge and ability through production activities
We made the company a wholly-owned subsidiary to tackle social contribution in terms of welfare for people with disabilities by promoting stable employment of people with disabilities in our group companies.
In the future, in addition to existing business, the company will be part of our group's business From the viewpoint of importance to business results, we have made the company an
Asahi Intecc Co., Ltd. corporate strategic office TEL 052-768-1211
URL http://www.asahi-intecc.co.jp/en/
All forward looking statements contained herein, including sales forecasts, outlooks, and strategic plans, are based on the best currently available data; however, risk and
uncertainty are involved in these statements. Please note that actual results may differ greatly from plans presented here.