Unicharm Corporation · TSE:8113
Unicharm — H1 2019 Earnings Presentation
34 slides from Unicharm's earnings presentation, Aug 8, 2019
Slide 1: First Half of Fiscal Year Ending December 31, 2019 Financial Performance
First Half of Fiscal Year Ending December 31, 2019 (January 1, 2019 to June 30, 2019) Financial Performance Unicharm Investor Meeting Presentation Materials August 8, 2019 Takahisa Takahara President and CEO Unicharm Corporation Projections stated in these materials include those based on the Compan
Slide 2: Financial Performance Summary: First Half of Fiscal Year Ending December 31, 2019
Financial Performance Summary: First Half of Fiscal Year Ending December 31, 2019 (January 1, 2019 to June 30, 2019) ◆ Document notations BC： Baby Care Business FC： Feminine Care Business HC： Health Care Business C&F：Clean & Fresh Business PC： Pet Care Business Copyright (c) Unicharm 2012 Unicharm C
Slide 3: Financial Performance Summary
First Half of Fiscal Year Ending December 31, 2019 Financial Performance Summary Consolidated results Sales of 342.5billion JPY (5.2% increase), core operating income 39.2 billion JPY (17.0% decrease). Core operating income (COPM) 14.5% ➡ 11.5% (13.2% excluding the impact of rising raw materia
Slide 4: Consolidated account highlights
5.2% sales increase, 17.0% core operating income decrease New record high for net sales. Net sales and income are on plan for consolidated results forecast. Consolidated account highlights (Millions of yen) (Forecast) 1H of FY 1H of FY Difference FY Ending Achievement Ended Dec. Ending Dec. Differ
Slide 5: Core operating income fluctuation
8.1 billion JPY decrease in income due to rising of raw material prices, deterioration of product mix, and not being able to absorb the cost of starting operation of Kyushu factory, in spite of effects of sales increase through agressive marketing investment in Asia. Core operating income fluctuat
Slide 6: Geographical segment information
For Asia, China drove increase in sales and profits, India sustained rapid growth. For Japan, strong performance in HC and PC, BC is improving despite the decline in sales in cross-border EC. For others, Middle East, Brazil, U.S.A. continued strong performances. Geographical segment information (M
Slide 7: Core operating income margin by geographical segment
Rising of raw material prices impacted the whole area. Japan showed recovering trend in 2Q despite the effect of inventory adjustment for Cross-Border EC in 1Q. Also, starting operation of Kyushu factory and rising of logistic expenses impacted. Core operating income margin by geographical segment
Slide 8: Business Segment Information
Increase in sales and decrease in income due to rising raw material costs and slowdown of Cross-Border EC, despite Personal Care showing strong performance overseas. Increase in sales and income for the second half of FY is expected, as Cross-Border EC shows recovering trends and decline in raw mate
Slide 9: Overseas sales composition ratio 64.2%
Overseas sales composition ratio 64.2% （64.7％ excluding foreign exchange impacts） Domestic / overseas sales (Billions of yen) 500 65.6% 64.2% 63.3% 58.5% 59.3% 59.8% 60.0% 60% 400 50.3% 48.0% 47.7% 43.1% 44.2% 43.0% 44.0% 300 40% 200 20% 100 0 0% '13/2Q '14 /2Q *1 '15 /2Q '16 /2Q '17/2Q '18/2Q '19
Slide 10: Rate fluctuations by currency
Impacts of foreign exchange fluctuations. Approx. 5.4 billion JPY decrease in sales. Approx. 400 million JPY decrease in core operating income Rate fluctuations by currency Exchange rate Exchange rate Currency Change in rate Jan-Jun 2018 Jan-Jun 2019 China (CNY) 17.09 16.20 -5.2% Indonesia (IDR) 0
Slide 11: Shareholder Return Policy
Shareholder Return Policy Copyright (c) Unicharm 2012 Unicharm Corporation. Corporation. All rights All rights reserved. reserved.
Slide 12: Shareholder return policy
Through dividend and acquisition of own shares linked to business performance, aiming for total return ratio of 50% in 2019. Shareholder return policy (100 millions of yen) Dividends Purchase of own shares Total return ratio 60% 400 50% 350 50% 300 40% 250 200 30% 150 20% 100 10% 50 0 0% '11/3 '12
Slide 13: Dividends per share
Implemented steady and continuous dividend payments, on track for 18 consecutive periods of increased dividends. Raised dividend payout ratio. Dividends per share (JPY) 40 Annual dividend (JPY) Consolidated divident payout ratio 35% 30% Approx. 30 26% 25% 20% 20 15% 28 24 10% 10 20 15 16 11 11 13
Slide 14: Stock buy-back acquisition graph
Swiftly acquire stocks through buy-back based on cash conditions. Acquired approx. 15 billion JPY in FY19 Stock buy-back acquisition graph (100 millions of yen) Stock buy-back acquisition 150 155 150 140 140 130 120 100 110 90 76 80 50 0 '11/3 '12/3 '13/3 '14/3 '14/12 *1 '15/12 '16/12 '17/12 '18/1
Slide 15: Improvement of Corporate Value
Improvement of Corporate Value Copyright (c) Unicharm 2012 Unicharm Corporation. Corporation. All rights All rights reserved. reserved.
Slide 16: Corporate culture
Corporate culture The company can be No.1 only if it remains dedicated to providing outstanding customer satisfaction at all times. Maintaining our No.1 position through continued and dedicated service Changing values Find reason within ourselves AII reasons and responsibilities are yours. You shoul
Slide 17: New DNA: BOP-ship
【New DNA】 BOP-ship Best Ownership Partnership Practice-ship Without caring about one’s position or one’s honor, not just internally, but one Without any selflessness and needs to desperately collect Taking everything as one’s always respecting Best Practice from all around work and with paranoia, th
Slide 18: Long-term revenue model through maximizing life time value
Long-term revenue model through maximizing life time value ◆Business model target to a wide range of customers Copyright Copyright (c) (c) Unicharm Corporation. 2012 Unicharm All rights Corporation. reserved. All rights reserved. 18
Slide 19: Competitive to support sustainable growth
Competitive to support sustainable growth ◆Evolution of our "winning patterns" ◆Expand market by strategy according to the each stage of each country and business Value appeal in high value-added products according to various needs and services Deploy at a price range that makes it Maturing stage ea
Slide 20: Structure of support to sustainable growth
Structure of support to sustainable growth ◆Management with Resonance ◆OODA-Loop method 【An environment where change has become normal (new normal)】 Observation： Observe the situation by five senses Orientation： Orient by obtaining information and past experience and knowledge. All employees continu
Slide 21: Approach to realize a “Cohesive Society”
Approach to realize a “Cohesive Society” Copyright (c) Unicharm 2012 Unicharm Corporation. Corporation. All rights All rights reserved. reserved.
Slide 22: Initiatives to achieve Unicharm’s envisioned “Cohesive Society”
Through our initiatives to achieve Unicharm’s envisioned “Cohesive Society”, resolve important issues and achieve sustainable growth 【Unicharm’s Key Challenges】 1. Lengthening Healthy Life 4. Contributing to Expectancy the Community・ Human respect 2. Supporting Women's Independence and Improving Hyg
Slide 23: Lengthening Healthy Life Expectancy
Lengthening Healthy Life Expectancy ◆Supporting healthy life expectancy with “Lifree” ◆Continuing participation in "Pink Ribbon activities" Japan and abroad Contributing to lengthening healthy life expectancy with Communicate the importance of early detection and early Lifree “Social Walking”* d
Slide 24: Supporting Women's Independence and Improving Hygiene
Supporting Women's Independence and Improving Hygiene ◆Effort to eliminate ◆Support for low-birth-weight baby “I can't go to school because I am menstruating” Expansion of first menstruation educational programs Support to baby, family and medical organization for in India, Indonesia, and Myanma
Slide 25: Supporting Women's Independence and Improving Hygiene
Supporting Women's Independence and Improving Hygiene ◆Efforts to lighten the burden of double-income households and nursery school teachers Launched baby diaper subscription service (flat rate billing) at nurseries where parents normally bring diapers with them Copyright Copyright (c) (c) Unichar
Slide 26: Contribution to Global Environment: diaper recycling model
Contribution to Global Environment ◆ Unicharm aimed diaper recycling model Realization of a system to recycle pulp to the same level as unused materials while keeping processing costs at the same level as incineration by improving processing efficiency. Recycled to the same level of sanitation a
Slide 27: Contribution to Global Environment
Contribution to Global Environment ◆ Efforts to reduce CO2 emission through products ◆ Efforts to reduce waste in factories Eco-charming products are defined as top products that Realized zero landfill waste by commercializing waste further promotes adaptation to a sustainable society by generat
Slide 28: Contributing to the Community
Contributing to the Community ◆Activities for “Support of Disaster-Affected Areas” Continuing the Matching Fund* which combines Disaster-Affected Area Support and energy-saving initiatives A total of 17,321 people participated in Super Cool Biz / Warm Biz activities over 8 years Utilized as do
Slide 29: Strengthen the company’s organization and ensure fair business practices
Strengthen the company’s organization and ensure fair business practices ◆ Maintain governance and enhancement: Transparency ・ Objectivity ・ Fairness Chairman (Nomination Committee ・ Compensation Committee ) changed from Representative Director President Executive Officer to Independent outside di
Slide 30: Activities of digital transformation (DX)
Activities of digital transformation (DX); corporate vision “Nola&Dola (dreams come true for consumers” ◆Pick up the seeds of consumers’ worries, provide ◆Establishment “Kyo-sei” Social Lab resolvable information Discovery real value to obtain bio‐information Child-rearing Video Media “Babily” i
Slide 31: Evaluation from and cooperation with external agencies
Evaluation from and cooperation with external agencies Included in 3 ESG Investment Indices Selected by GPIF Integrated indices Thematic indices Selected Selected Selected Other SRI indices Selected N/A Copyright Copyright (c) (c) Unicharm Corporation. 2012 Unicharm All rights Corporation. reserved.
Slide 32: Evaluation from and cooperation with external agencies
Evaluation from and cooperation with external agencies Science Base Targets JCI FSC (Japan Climate Initiative) (Forest stewardship council) In June 2018, the company was Develop best practices for Prioritized use of pulp that meets certified as the 17th target setting advanced groups as
Slide 33: Evaluation from and cooperation with external agencies
Evaluation from and cooperation with external agencies Sedex White 500 Platium Kurumin For UC Group Factories, registered 19 Recognized the efforts in work style Earned the right to use the factories in Japan, principle countries in reform, acknowledgement continued Platinum Kurumin logo
Slide 34: Copyright Corporation. All rights
Copyright Copyright (c) (c) Unicharm Corporation. 2012 Unicharm All rights Corporation. reserved. All rights reserved. 34