FY2020/12 Results Briefing(IFRS) And The New Long–term Vision

3y ago
1.72 MB
35 Pages
Last View : 5d ago
Last Download : 6m ago
Upload by : Oscar Steel

Securities Code: 6268F Y 2020/ 12 Results B rief ing(IF RS )and the New Long–te rm VisionFebruary 18, 2021C E O Ka t s u h i r o T E R A M OTOThe forecast data presented herein reflects assumed results based on conditions that are subject to change.Nabtesco Corporation does not make representations as to, or warrant, in whole or in part, the attainment or realization of any of the forecasted resultspresented in this document.Numerical figures presented herein are rounded.

Agenda1. Summary2. Consolidated Results for FY2020/123. Forecast for FY2021/124. Review of the Mid-term Management Plan5. The New Long–term Vision2

Agenda1. Summary3

SummarySales(JPY billion)350.0- In FY2020 sales decreased due to stagnation of economic activities and restriction caused byCOVID-19.- In FY2021 sales will increase due to demand recovery in the precision reduction gear businessand ongoing robust demand in the hydraulic equipment business.300.0250.0289.8200.0CMP*1TRS*2ACB*3MFR*4 2.7-5.9-6.3-0.92019/12 ResultsO.P.6.610.4CMPTRSACBMFR279.4 12.9- 7.5- 1.3 2.5286.02020/12 Results2021/12 Plan- In FY2020 O.P. increased due to the gain on the sale of non-business property.- In FY2021 O.P. will increase due to sales growth in the CMP segment.(JPY billion) 1.8TRS- 0.3ACB- 0.8MFR- 0.2Gain on non-businessproperty 4.9Impairment loss (OVALO)-2.123.628.5CMPTRSACBMFRHQ*5Others5.4 2.7- 0.1- 0.4 0.6- 0.8- 1.529.00.02019/12 Results*1 Component Solutions Segment2020/12 Results2021/12 Plan*2 Transport Solutions Segment *3 Accessibility Solution Segment *4 MFR: Manufacturing Solutions Segment *5 HQ: Corporate or Elimination4

Agenda2. Consolidated Results for FY2020/125

FY2020 External Factors Market Conditions: COVID-19 had a significant impact on most of the industries.IndustryYoYRobotics-7.5%(Japan, Export)Machine tool-26.8%(Japan, Export)-26.1%Construction MachineryConstructionMachinery (China)Japan Robot Association(Shipping units of Welding,Painting Robot)Japan Machine ToolBuilders' Association(Order Volume)Automotive (Global)(Japan, Export)Refer to-20.7% 39%Organisation Internationale desConstructeurs d'Automobiles(Global Production units 1-3Q)Japan ConstructionEquipment ManufacturersAssociationChina ConstructionMachinery Association(Shipping Units)IndustryRailroad (Japan)Civil Aviation(Global)Marine Vessel (Japan,Export)Commercial Truck(Japan)Construction(Japan)YoYRefer to-33.7%-65.9%-10.8%-7.3%-11.2%JAPAN PRIVATE RAILWAY ASSOCIATION(Apr. thru Oct. Number ofpassengers)The International Air TransportAssociation(Revenue Passenger-Kilometers)The Shipbuilders' Association of Japan(Completion Vessels, Comparison1H)Japan Automobile Dealers Association(Japanese 4 manufactures,Registered)Ministry of Land, Infrastructure,Transport and Tourism(Groudbraking,Total floor area) Countermeasures against COVID-19: Established a task force team to prevent infection, fostertelecommuting, and restrict business trips and movements between the plantsAttendance rate*100.0%Mar. 2 StartA/B Shift work80.0%60.0%40.0%20.0%0.0%*At HQ and sales offices (excluding employees on leave/business trips)Feb. 7 Workfrom homerecommendApr. 7〜May 31State ofemergencyin JapanControlled to below 40% level since Aug.June 15 CancelA/B Shift workJuly 27 RestartA/B Shift workJan. 6 Restrictionfor movingJan. 7〜State ofemergencyin Japan27.5%1/6 1/20 2/3 2/17 3/2 3/16 3/30 4/13 4/27 5/11 5/25 6/8 6/22 7/6 7/20 8/3 8/17 8/31 9/14 9/28 10/1210/26 11/9 11/23 12/7 12/21 1/4 1/186

Consolidated Results for FY2020 Although sales decreased year-on-year due to negative impact of COVID-19, O.P. increased year-on-year dueto productivity improvement and cost reduction in each business and to the gain on the sale of non-businessproperty.(JPY million)Sales2019/122020 /122020/12Full year resultFull yearrevised planFull year result(A)(B)(C)As of July. 31YOYRevised ,4676031,143Income before tax27,97927,00033,7185,7396,718Net cial Incomeand CostEquity in earningsof affiliates*11Net profit attributable to owners of the n)DPS (JPY Yen)Payout ratioAverage payout ratio over 4years(2017-2020)︓42.9% (Plan)7

Analysis of Factors Causing Changes in Operating Profit (Relative to FY2019) O.P. increased due to cost reduction, productivity improvement, business transformation andthe gain on the sale of non-business property.(JPY ndirectexpenses0.8Temporaryreductionin expensesCommuting cost,business travelexpenses, etc.R&D expenses: JPY 0.9 billionIndirect materials expenses: JPY 0.6 billionIndirect outsourcing costs: JPY 0.5 billionUtility costs: JPY 0.3 billion1.0Productivityimprovement0.7Reductionin expensesdue toreformDecline inexpensesdue to work stylereform andbusinesstransformation2.6Impairmentloss etc.4.9Gain on thesale of nonbusinesspropertyImpairment loss ofOVALO GmbHFY2019 JPY 1.3 billionFY2020 JPY 3.4 (IFRS)*FOREX negative impact(JPY 0.4 billion)was included.-Exchange rate FY2020(Result) 1USD 106.43 1CNY 15.45 1EUR 121.97 1CHF 113.84-FOREX sensitivity in O. P. (This represents the effect to be expected on operating profit if the exchange rate fluctuates by one yen)︓(US ) JPY 52 million (RMB) JPY 932 million (EUR) minimal (CHF) minimal8

Analysis of Factors Causing Changes in Net Sales and Operating Profitby Segment (Relative to FY2019) Sales and O.P. increased in CMP. Both sales and O.P. decreased in TRS and ACB despite theefforts made to expand MRO business and control SG&A.SalesO.P.(JPY billion)(JPY billion) 0.5 0.8 0.2 5.0 ults0.02019/12ResultsCMPTRSACBMFRHQOVALO 2020/12ResultsCMP: Sales of precision reduction gears slightly increased in Q4 due to the recovery of capital investment in theChinese and North American automobile industries.For hydraulic equipment, sales increased due to robust market demand in the Chinese market and a sign ofrecovery observed in the European and American markets.O.P. increased due to the sales increase.TRS: Sales decreased in each business, including the aircraft equipment and commercial vehicle equipmentbusinesses due to global movement restrictions.O.P. decreased due to the sales decrease. OVALO GmbH posted impairment loss for fixed assets in Q4.ACB: Sales decreased because of a decrease in the number of redevelopment projects implemented for Tokyo2020 and due to weaker domestic and global demand caused by COVID-19.O.P. decreased due to the sales decrease.MFR : Sales and O.P. decreased due to sluggish demand for packaging machines in the food service industryHQ: Gain on the sale of non-business property (JPY 4.9 billion)9

Balance Sheet (Year-on-Year Comparison) Ratio of equity attributable to owners of parent: Over 55%Thus has a sound balance sheet(JPY million)Assets2019/12 Q42020/12 Q4(As of December 31, 2019)(As of December 31, 2020)Variation344,558351,7237,166(Cash and cash equivalents)58,68664,6655,980(Trade 25736,505-4,752(Tangible fixed 5187,398198,03110,63254.4%56.3%Liabilities(Bonds and borrowings)Total equities(Non-controlling interests)Equity attributable toowners of parentRatio of equity attributableto owners of parent10

Agenda3. Forecast for FY2021/1211

Forecast for FY2021 Despite the negative impacts of COVID-19, overall sales and O.P. will increasedue to sales growth in CMP and MFR. Plans for share buyback in addition to thestable dividend increase.(JPY million)2020 /122021/12Full year resultFull year planSales(C )*2Including valuationgain for HDS(B)Excluding valuationgain for 1%-0.1pt-Financial profit andloss1,718-100132,900Income before tax33,71830,000163,000Net profit*120,50519,300112,200*1 Net profit attributable to owners of the (JPY Yen)Payout ratioBuybackTotal return ratioAverage payout ratioover 5 years(2017-2021)︓33.5%*2 2021/12 Plan (C) includes valuation gain for the shares of Harmonic Drive Systems (HDS), which causes increases in the “Income before tax,” ”Netprofit” and other KPIs as compared to Plan (B).12

Dissolution of Cooperative Relationship with HDS and Sale of theShares【Purpose】- Further increase the corporate value of the two companies- Make use of each other’s technologies and create new market togetherCooperativeRelationshipwith HDSDissolutionof therelationshipSale ofshares・December 2005: Established a joint venture in the United States.(Harmonic Drive L.L.C.)- 51% of equity interest owned by the HDS Group- 49% of equity interest owned by the Nabtesco Group・June 2009: Included HDS as an equity-method affiliate.(With Nabtesco owning 20% of HDS shares)・February 2018 Subscribed Third-Party Share Options issued by HDS when the companyraised funds by issuing new shares.Expiration: February 2023(Nabtesco owned 19.03% of HDS shares and share options thataccounted for 0.97% of HDS shares)【Background】- Nabtesco will need a large amount of money to exercise the share options ofHDS by 2023. However, current return on investment is relatively low for HDS’sshares.- Cooperative relationship with HDS has brought about some effects in the US.However, both the companies have recognized that no further synergy effectswill be expected through this cooperative relationship.- Nabtesco needs to utilize cash in order to deal with the COVID-19 crisis,strengthen the Company’s financialfoundation, and meet the mid-to-long term challengesAccounting︓Change in Equity-method Affiliates and recording of paper profit (financial profitand loss) for FY 2021.* HDS: Harmonic Drive Systems13

Analysis of Factors Causing Changes in Net Sales and Operating Profitby Segment (Relative to FY2020) Although the difficult economic situation will continue, sales and O.P will increase due torobust demand in CMP.O.P.Sales(JPY billion)(JPY billion)0.10.4 0.6 0.8 286.0279.415.010.0Elimination ofimpairment loss inOVALO and gain onnon-business property28.529.0 2020/12ResultsCMPTRSACBMFRHQSpecial 2021/12factorsPlanCMP: Sales of precision reduction gears will increase due to the recovery of demand for industry robots in theautomobile industry.Sales of hydraulic equipment will increase due to steady demand in the Chinese market and the recovery ofdemand in the developed countries and Southeast Asia.O.P. will increase due to the sales increase.TRS: Sales will decrease in the railroad vehicle and aircraft equipment businesses due to the ongoing negativeimpact of COVID-19. O.P. will remain at the same level, excluding the influence ofimpairment loss posted for OVALO in 2020ACB: Sales and O.P. will decrease due to temporary drop in demand for platform doors in the domestic market.MFR : Sales will increase due to stronger demand for packaging machines in the domestic and overseasmarkets.Special factors causing a decrease in O.P. (JPY 1.5 billion): Fixed assets impairment loss (JPY 3.4 billion) and the gainon the sale of property (JPY 4.9 billion) recorded in FY202014

CAPEX, R&D and Depreciation / Cash Flow Decreased CAPEX and R&D expense in FY2020. In FY2021, will increase R&D expense for sustainable growth.(JPY billion)2017/122018/122019/122020/122021/12Full yearresultFull yearresultFull yearresultFull yearresultFull .037.8Depreciation9.010.013.1*213.7*213.6*2CAPEX*1 Includes the investment (JPY 5.7 billion) made to acquire land for the Hamamatsu Plant, which will be constructed to meet the future demand for precisionreduction gears. *2 Increased due to the adoption of the lease accounting standard (IFRS 16) Cash FlowIn FY2021, investment cash flow will temporarily increase as a result of selling some sharesof Harmonic Drive Systems.(JPY billion)100.0Operating Cash FlowInvestment Cash FlowFree Cash 020/122021/12(Plan)15

Expected Cash Gain and the UsageThe gain on the sales of HDS shares would be approx. JPY 100 billion (after tax)if the stock price is 8,000 JPY.Sell all the HDS shares held by Nabtesco (18,320,400 shares)NTS sells half of the shares this time(9,160,200 shares)The remaining shares NTS plan to sell in the future(9,160,200 shares)JPY 20 billion for shareholder returnJPY 50 billion for growth investment-Buyback and cancellation(Up to 4.4 million shares or JPY 20 billion)JPY 30 billion to strengthen thefinancial foundation- Higher liquidity of cash- Retirement of 2nd series ofunsecured straight bonds (Finalmaturity date: December 2021)-Settlement of the difference arisingfrom selling shares-Environment-friendly factoriesin Hamamatsu (PRG*1) andTarui (HEB*2)-Investment in R&D forelectrification and theproduction of systems-Investment in M&A and CVCprojects*1 PRG: Precision Reduction Gears*2 HEB : Hydraulic Equipment Business16

Agenda4. Review of the Mid-term management plan17

Progress with the Medium-term Management Plan: ROE/Payout Ratio ROE FY2021: 10.0% (Except for valuation gains for HDS shares). Total shareholders return (During the period from 2017 to 2021, except for valuation gainson for HDS shares) 44.1%.(33.5% Including valuation gains for HDS shares). 100DPSTotal return ratio80.0%ROE 90 80 7070.0% 72 7350.6%43.1% 60 50 73 7545.4% 2049.5%46.9%35.6%26.2% 40 30 %10.0% 10 )*HDS︓Harmonic Drive Systems18

Progress with the Medium-term Management Plan: Focus on Solving ESGIssues Steady implementation of measures for sustainability and governance-E︓“Combat climate change,” ”Reduce environmental impact,” “Disclose more non-financial information”-S︓ “Further revitalize the organization,” ”Enhance human resource development,” “Enhance CSR-oriented procurement”-G︓“Ensure management transparency,” ”Globalize Risk measuresagainst climateEnviron- ingFY 2017/12 Set long-term CO2reduction targetFY 2018/12 Endorsed Promoted environmentrecommendations of TCFDrelated investment (solar Promoted the introductionpower generation)of renewable energy Accelerated measures tocomply with the Act onRational Use and AppropriateManagement ofFluorocarbons Offered environmentrelated �S)Provide safe andcomfortableworkplacesStrengthen CGGovernance(G)Promote riskmanagement andcomplianceEnsure proactivedialogue withstakeholdersFY 2019/12FY 2020/12 Achieved 2020 CO2 reductiontarget Started examining the 1.5degrees Celsius scenario Managed hazardous substancescontained in products through LCA Revised the CSR-orientedprocurement policy Launch of the BusinessTransformation Division Promoted teleworking Installed systems(for RPA, AI utilization) Returned the benefits of Enhanced health and Implemented duehigher productivity toproductivity managementdiligence (DD) for humanemployeesrights Transition to a selective careerprogram Implemented due diligence (DD)for human rights Adopted Board BenefitTrust (BBT) as acompensation plan Revised CG basic policy Abolished the advisorsystem Increased the ratio of outsidedirectors Risk management on acompany-wide basis Enhanced riskassessment Globalized the internalreporting system Provided compliance training atGroup companies in and outsideJapan Strengthened corruption Set local rules to preventand bid rigging preventioncorruption and bid riggingmeasures Enhanced integratedreporting Established the Nabtesco Held an ESG briefingsessionGroup Community Disclosed ESG dataInvestment Policy Established an integrated riskmanagement system Held the first IR Day Set a new materiality list19

Progress with the Medium-term Management Plan: Environmental (E)Initiatives Actively implemented energy creation and energy saving initiatives in order to reduce CO2 emissions.As a result, achieved a substantial reduction and exceeded the FY2020 target.【Example for energy creation】Installed a solar power generationsystem at the Tsu plant.CO2 Emissions(Domestic Group companies)55,000CO2 EmissionsEnergy creationCO2 Reduction51,894Energy savingCO2 Free in Electric power purchase53,214CO2 Emissions 184Decreasedby 0192019Result実績20202020Result実績Reducedby 30%comparedFY20152030Target20

ESG Evaluation We have been continuously selected for inclusion in major ESG indices, such as DJSI World and FTSE. Evaluated as the “A List” company in all three major CDP categories.2017201820192020DJSI Asia Pacific (2013〜) DJSI World (2016〜) FTSE4Good (2015〜) ESGindices FTSE Blossom JapanMSCI ESG Leaders IndexesMSCI Japan ESGSelect LeadersSMSCI JapanEmpowering Women S&P/JPX Carbon EfficientCDP CLIMATE CHANGEECDP WATER SECURITYCDP SUPPLIER ENGAGEMENT LEADER 21

Agenda5. The New Long–term Vision22

The New Long–term Vision for 2030Long-term Vision2005-2014Long-term Vision2012-2020“Global Partner with Best Solutions”New Long-term Vision2021-2030“As a leader in innovation”“Global company”・For further growth・Partner who can help customers ・Create new value by takingone step ahead of our customerssolve their problems・Serve customers closely and attentivelyfor the creation of a new market・Proactively make proposals to winglobal competition

The New Long–term Vision for 2030Leaders in Innovationfor the Future2030VisionChanging the“Cs”through innovationTechnologyCreating what thefuturewants withour unique e・・・Designing anew way of “moving”GlobalizationContributionGlobal standardsmade in JapanSDGs & ESGBecominga truly globalcompanyReliable “Monozukuri” and Meistersin ManufacturingProviding safety, security and comfortContributing to socialprogressand environmentalconservationEnjoy the ChallengeIdentity of NabtescoRealizingeach and everyone’s dream

The New Long–term Vision for 2030Our Aim for 2030Creating new value with our unique technologyand intelligenceEnriching lifestyles and the environment worldwide“Moving your heart” by providingsafety and securityFormulation of a new mid-term plan (3 years) based on the new long-termvision


Component Solutions Segment (CMP)Precision Reduction GearsSales(JPY billion)113.9119.3Hydraulic tResultResultResultPlanO.P.(JPY .1%16.6%72.6Railroad Vehicle EquipmentSales(JPY billion)Commercial Vehicle EquipmentMarine Vessel 818.814.210.85.912. billion)(OPM)Aircraft es of Nabtesco Service is calculated until as of the result for 2017/1227

Accessibility Solution Segment (ACB)Sales(JPY billion)Automatic Doors80.076.072.476.072.4

Marine Vessel (Japan, Export)-10.8% The Shipbuilders' Association of Japan (Completion Vessels, Comparison 1H) Construction Machinery (Japan, Export)-20.7% Japan Construction Equipment Manufacturers Association Commercial Truck (Japan)-7.3% Japan Automobile Dealers Association (Japanese 4 manufactures, Registered) Construction Machinery .

Related Documents:

(a) IFRS 9 Financial Instruments (Part A); and (b) IFRS 15 Revenue from Contracts with Customers (Part B). Introduction 2 IFRS 17 is effective from 1 January 2021. An insurer can choose to apply IFRS 17 before that date but only if it also applies IFRS 9. 3 The paper considers components of IFRS 9 and IFRS 15 that are relevant to the

IFRS 17 basics IFRS 17 is the new accounting standard for Insurance Contracts published 18 May 2017 Replace the interim standard IFRS 4 (not standardized across jurisdictions) EU endorsement still under process Go-live 1st January 2022 18 May 2017 IFRS 17 Publication Effective application of IFRS 17 & IFRS 9 1st January 2022 IFRS 17 Go-live ! Transitory

New IFRS Standards—IFRS 16 Leases Page 1 of 26 . Agenda ref 30E STAFF PAPER June 2019 IASB Meeting Project Comprehensive review of the IFRS for SMEs Standard Paper topic New IFRS Standards—IFRS 16 Leases CONTACT(S) Yousouf Hansye ykhansye@ifrs.org 44 (0) 20 7246 6470

1 Overview of IFRS 9 and implementation plan in Thailand 2 IFRS 9 Classification and Measurement 3 IFRS 9 Impairment 4 IFRS 9 Hedge accounting 5 Transition requirements (with applying IFRS 9 with IFRS 4 phase II) 6 Concluding remark

IFRS and US GAAP: similarities and differences IFRS first-time adoption IFRS 1, First-Time Adoption of International Financial Reporting Standards, is the standard that is applied during preparation of a company's first IFRS-based financial statements. IFRS 1 was created to help companies transition to IFRS and provides practical

FY2020: Vaccine business loss compensation Profit before tax FY2020: Financial income due to decrease in contingent consideration of Ambit/quizartinib acquisition Profit attributable to owners of the Company FY2020: Decrease in income taxes due to an increase in DTA attributable to future exp

Adopting IFRS – A step-by-step illustration of the transition to IFRS Illustrates the steps involved in preparing the first IFRS financial statements. It takes into account the effect on IFRS 1 of the standards issued up to and including March 2004. Financial instruments under IFRS – A guide through the maze

IFRS 3 Summary Notes Page 1 (kashifadeel.com)of 6 IFRS 3 IFRS 3 Business Combination INTRODUCTION Background IFRS 3 Business Combinations outlines the accounting when an acquirer obtains control of a business (e.g. an acquisition or merger).