Kanadevia Corporation · TSE:7004
Kanadevia — Hitachi Zosen — Q2 FY2019 Earnings Presentation
38 slides from Kanadevia's earnings presentation, November 2019
Slide 1: Financial Results for Second Quarter FY2019
Financial Results for Second Quarter FY2019 November, 2019 Hitachi Zosen Corporation © 2019 Hitachi Zosen Corp.
Slide 2: Contents
Contents 1. Overview of Second Quarter FY2019 Consolidated Financial Results 2. Forecast of FY2019 3. Details by Segments 4. Second Quarter FY2019 Topics 5. Support Documentation (Details by small Segments) © 2019 Hitachi Zosen Corp. 2
Slide 3: 1. Overview of Second Quarter FY2019 Consolidated Financial Results
1. Overview of Second Quarter FY2019 Consolidated Financial Results © 2019 Hitachi Zosen Corp. 3
Slide 4: Key Points of Second Quarter FY2019 Results
Key Points of Second Quarter FY2019 Results ■Order intake exceeded 200.0 billion yen ■Hitachi Zosen Inova’s deficit improved ■Extraordinary loss due to a settlement of lawsuit related to US shield construction © 2019 Hitachi Zosen Corp. 4
Slide 5: Results for Second Quarter FY2019 - Overview
Results for Second Quarter FY2019- Overview (Unit: Billion Yen) FY2018-2Q FY2019-2Q Difference (a) (b) (b)-(a) (Ratio to Net sales) (Ratio to Net sales) Order intake 185.5 200.2 14.7 Net sales 153.2 168.2 15.0 Operating (- 5.5%) -8.4 (- 3.8%) -6.3 2.1 income Ordinary (- 5.6%) -8.6 (- 4.1%) -6.8 1.8
Slide 6: Results for Second Quarter FY2019 - Order intake
Results for Second Quarter FY2019- Order intake (Unit: Billion Yen) FY2018-2Q FY2019-2Q Difference (a) (b) (b)-(a) Environmental Systems and 123.4 115.4 -8.0 Industrial Plants Machinery 42.5 55.6 13.1 Infrastructure 13.6 23.7 10.1 Others 6.0 5.5 -0.5 Total 185.5 200.2 14.7 © 2019 Hitachi Zosen Corp.
Slide 7: Results for Second Quarter FY2019 - Net sales
Results for Second Quarter FY2019- Net sales (Unit: Billion Yen) FY2018-2Q FY2019-2Q Difference (a) (b) (b)-(a) Environmental Systems and 87.9 106.4 18.5 Industrial Plants Machinery 47.2 43.0 -4.2 Infrastructure 12.7 13.3 0.6 Others 5.4 5.5 0.1 Total 153.2 168.2 15.0 © 2019 Hitachi Zosen Corp. 7
Slide 8: Results for Second Quarter FY2019 - Operating income
Results for Second Quarter FY2019- Operating income (Unit: Billion Yen) FY2018-2Q FY2019-2Q Difference (a) (b) (b)-(a) Environmental Systems and - 8.1 - 0.5 7.6 Industrial Plants Machinery - 0.5 - 3.2 - 2.7 Infrastructure - 0.1 - 3.0 - 2.9 Others 0.3 0.4 0.1 Total - 8.4 - 6.3 2.1 © 2019 Hitachi Zose
Slide 9: Breakdown of changes in Operating income
Results for Second Quarter FY2019- Breakdown of changes in Operating income (Unit: Billion Yen) FY2018-2Q Operating income - 8.4 ・Improvement in deficit at HZI +5.1 ・Improvement in profitability Breakdown and others at Environmental +2.0 of changes in Systems in Japan Operating 2.1 ・Deterioration in
Slide 10: Non-operating income and Extraordinary profit and loss
Results for Second Quarter FY2019- Non-operating income and Extraordinary profit and loss Net Non-operating income & expenses (Unit: Billion Yen) FY2018-2Q FY2019-2Q Difference (a) (b) (b)-(a) Net interest expense & dividend - 0.2 - 0.2 0.0 Equity in net income of affiliates 0.2 0.3 0.1 Others - 0.2
Slide 11: Results for Second Quarter FY2019 - Balance Sheet
Results for Second Quarter FY2019- Balance Sheet (Unit: Billion Yen) End of End of Difference Mar. 2019 Sep. 2019 (a) (b) (b)-(a) Cash and deposits 35.6 26.9 - 8.7 Operating assets 203.5 158.7 - 44.8 Trade notes and accounts receivable 172.7 125.3 - 47.4 Inventories 30.8 33.4 2.6 Tangible & intangib
Slide 12: Cash flows and Interest-bearing debt
Results for Second Quarter FY2019- Cash flows and Interest-bearing debt Cash flows (Unit: Billion Yen) FY2018-2Q FY2019-2Q Difference (a) (b) (b)-(a) Cash flows from operating activities - 0.0 25.4 25.4 Cash flows from investing activities - 4.1 - 7.6 - 3.5 Cash flows from financing activities 0.4 -
Slide 13: 2. Forecast of FY2019
2. Forecast of FY2019 © 2019 Hitachi Zosen Corp. 13
Slide 14: FY2019 Forecast - Overview
FY2019 Forecast-Overview (Unit: Billion Yen) FY2018 FY2019 Difference Forecast Forecast Forecast Forecast Results as of May as of Aug. as of Oct. 4 as of Nov. (a) (b) （c） （c）-（a） （c）-（b） (Ratio to Net sales) (Ratio to Net sales) (Ratio to Net sales) (Ratio to Net sales) (Ratio to Net sales) Order 45
Slide 15: FY2019 Forecast - Order intake
FY2019 Forecast-Order intake (Unit: Billion Yen) FY2018 FY2019 Difference Forecast Forecast Forecast Forecast Results as of May as of Aug. as of Oct. 4 as of Nov. (a) (b) （c） (c)-(a) (c)-(b) Environmental Systems and 314.7 240.0 240.0 240.0 240.0 -74.7 0.0 Industrial Plants Machinery 100.7 110.0 110
Slide 16: FY2019 Forecast - Net sales
FY2019 Forecast-Net sales (Unit: Billion Yen) FY2018 FY2019 Difference Forecast Forecast Forecast Forecast Results as of May as of Aug. as of Oct. 4 as of Nov. (a) (b) （c） (c)-(a) (c)-(b) Environmental Systems and 228.3 240.0 240.0 240.0 255.0 26.7 15.0 Industrial Plants Machinery 106.6 100.0 100.0
Slide 17: FY2019 Forecast - Operating income
FY2019 Forecast-Operating income (Unit: Billion Yen) FY2018 FY2019 Difference Forecast Forecast Forecast Forecast Results as of May as of Aug. as of Oct. 4 as of Nov. (a) (b) （c） (c)-(a) (c)-(b) Environmental Systems and 5.6 10.0 10.0 10.0 13.0 7.4 3.0 Industrial Plants Machinery -0.3 1.0 1.0 1.0 0.
Slide 18: 3. Details by Segments
３． Details by Segments © 2019 Hitachi Zosen Corp. 18
Slide 19: Environmental Systems and Industrial Plants
Environmental Systems and Industrial Plants （ Unit: Billion Yen ） ■Results ■Forecast 【Order intake】 Order intake （As of Oct. 4） (As of Nov.) ■FY2019 2Q results (vs. FY2018 2Q) 115.4（-8.0） 314.7 ・Decrease in large-scale construction of 240.0 240.0 domestic EfW 123.4 115.4 ■FY2019 revised forecast (vs
Slide 20: Machinery
Machinery ■ Results ■ Forecast （ Unit: Billion Yen ） 【Order intake】 Order intake （As of Oct. 4） (As of Nov.) ■FY2019 2Q results (vs. FY2018 2Q) 55.6（＋13.1） 100.7 110.0 110.0 ・Increase in Marine Diesel Engine 42.5 55.6 ・Large nuclear project ■FY2019 revised forecast (vs. as of Oct. 4) 6 mo. 12 mo. 6
Slide 21: Infrastructure
Infrastructure （ Unit: Billion Yen ） ■ Results ■ Forecast 【Order intake】 （As of Oct. 4） (As of Nov.) Order intake ■FY2019 2Q results (vs. FY2018 2Q) 23.7（＋10.1） 40.0 40.0 ・Large projects of bridges and steel stacks 27.6 23.7 ■FY2019 revised forecast (vs. as of Oct. 4) 13.6 40.0（±0) 6 mo. 12 mo. 6 mo
Slide 22: 4. Second Quarter FY2019 Topics
4. Second Quarter FY2019 Topics © 2019 Hitachi Zosen Corp. 22
Slide 23: Inova Reconstruction
Ⅰ．Inova Reconstruction ■EPC Projects Execution O&M Forecast ☆ O/I FY19 ★ O/I FY20 onward FY Project (Country) Scope 2016 2017 2018 2019 2020 2021 2022 2023 B Edingburgh (UK) Full Turnkey 【2019/4 Delivered】 a Ferrybridge2(UK) Full Turnkey 【2019/11 Delivery】 c k Istanbul(Turkey) JV(local partner) l o
Slide 24: Inova EPC Projects Status: Ferrybridge 2
Ⅰ．Inova EPC Projects Status ①Ferrybridge２(FM2) ■Project description • Scope：EfW EPC • Capacity：2,030t/d (1,015t/d×2lines） • Delivery：2019/11 ■2019/1st half Cost increase and mitigation measures • 2019/1Q Due to the delay of EIC work, 1.9 Billion JPY additional cost booked. • Dispatched Hitz Japan co
Slide 25: Inova EPC Projects Status: Istanbul
Ⅰ． Inova EPC Projects Status ② Istanbul ■Contract diagram ■ Project description • 1st Project in Turkey Istanbul Municipality • Scope：EfW EPC + 1 year O&M • Capacity：3,000t/d (1,000t/d×3 lines） Joint Venture (Inova 51%, Local partner49%) • Delivery：2021/3 (Original 2020/10） Local partner Hitachi Zos
Slide 26: Inova EPC Projects Status: Moscow1
Ⅰ． Inova EPC Projects Status ③Moscow1 ■Project description Moscow EfW Project • 1st Project in Russia • Supply contract of four duplicate plants • Scope：EP+SV in Moscow region signed in July. • Capacity：2,100t/d (700t/d×3 lines) • This is a part of Moscow Government’s • Delivery：2022 waste managemen
Slide 27: Initiatives to Strengthen Service Business in Process Equipment
Initiatives to Strengthen Service Business in Process Equipment ■Development of Only-One technology for inspection of multi-tubular heat exchanger: 1) Technology : Phased Array UT (PA-UT) technology 2) Target : Oil and chemical plants, etc. 3) Background：①Growing demand of the life extension of aged
Slide 28: Initiatives to Strengthen Service Business in Process Equipment
Initiatives to Strengthen Service Business in Process Equipment ■Sep. 2019：Largely upgraded PA-UT technology • Developed own unique AI software. (Automatic judgment of flaw detection data + report making) • Inspection image shared with multiple-inspectors and distant supporters via smart glasses. （N
Slide 29: Methanation Process Expanded in Domestic and Global Markets
Methanation Process Expanded in Domestic and Global Markets Our technology development: Since 1993. First demonstration in the world proving CO₂ recycle is technically possible. Future CO₂ Recycle Cycle CO₂ ガス田 Gas field Water electrolysis with unused CO₂ Biogas renewable and separation other power
Slide 30: Methanation Process Expanded in Domestic and Global Markets
Methanation Process Expanded in Domestic and Global Markets ■Methanation test plant Joint development with NEDO and INPEX • Co-work with New Energy and Industrial Technology Development Organization (NEDO) and INPEX Corporation • Our scope: design and production of test plant • Completed and started
Slide 31: Expansion of Bridge Reinforcement Work
Expansion of Bridge Reinforcement Work ■Bridge maintenance (seismic reinforcement, anti-aging measures, etc.) • Many achievements in seismic reinforcement work • Long bridges; Minato Bg, Tenpozan Bg, etc. • Tanaka Award (Japan Society of Civil Engineers) with Katashinagawa Bg (Kan-Etsu Expressway) •
Slide 32: Lawsuits Related to Shield Tunneling Machine (SR99) in Seattle
Lawsuits Related to Shield Tunneling Machine (SR99) in Seattle ■ Outline • 1 shield tunneling machine for road tunneling in Seattle, US • Customer: Seattle Tunnel Partners (STP), JV of local construction companies • After 2 year suspension, tunneling completed in April 2017 • 2 lawsuits filed relate
Slide 33: 5. Support Documentation (Details by small Segments)
5. Support Documentation (Details by small Segments) © 2019 Hitachi Zosen Corp. 33
Slide 34: Results for Second Quarter (By Small Segment of Environmental Systems & Industrial Plants)
Results for Second Quarter (By Small Segment of Environmental Systems & Industrial Plants) (Unit: Billion Yen) FY2016 FY2017 FY2018 FY2019 Difference 2Q 2Q 2Q 2Q （a） （b） (b)-(a) EPC 61.5 59.5 33.4 48.3 14.9 Order Stable 62.9 98.5 90.0 67.1 - 22.9 intake Business* Total 124.4 158.0 123.4 115.4 - 8.0
Slide 35: Results and Forecast (By Small Segment of Environmental Systems & Industrial Plants)
Results and Forecast (By Small Segment of Environmental Systems & Industrial Plants) (Unit: Billion Yen) FY2016 FY2017 FY2018 FY2019 Difference Difference Forecast Forecast Forecast Results Results Results as of May as of Aug. as of Nov. (a) (b) (c) (c)-(a) (c)-(b) EPC 117.0 86.8 132.3 124.0 124.0 1
Slide 36: Results for Second Quarter (By Small Segment of Machinery)
Results for Second Quarter (By Small Segment of Machinery) (Unit: Billion Yen) FY2016 FY2017 FY2018 FY2019 Difference 2Q 2Q 2Q 2Q (a) (b) (b)-(a) Marine Diesel Engine 12.2 9.0 5.2 15.2 10.0 Press Machine 13.0 13.1 13.4 12.9 - 0.5 Order Process Equipment 4.6 2.1 4.0 6.9 2.9 intake Precision Machinery
Slide 37: Results and Forecast (By Small Segment of Machinery)
Results and Forecast (By Small Segment of Machinery) (Unit: Billion Yen) FY2016 FY2017 FY2018 FY2019 Difference Difference Forecast Forecast Forecast Results Results Results as of May as of Aug. as of Nov. (a) (b) (c) (c)-(a) (c)-(b) Marine Diesel Engine 20.8 17.7 21.8 25.0 25.0 25.0 3.2 0.0 Press M
Slide 38: Technology for People, the Earth, and the Future
Technology for People, the Earth, and the Future Hitachi Zosen creates links between mother nature and our future Cautionary Statement Forward-looking statements are based on information currently available to Hitachi Zosen Corporation. Therefore those forward- looking statements include unknown ris