MinebeaMitsumi Inc. · TSE:6479
MinebeaMitsumi — Q2 FY2018 Earnings Presentation
34 slides from MinebeaMitsumi's earnings presentation, Nov 8, 2017
Slide 1: Business Results, Second Quarter of Fiscal Year Ending March 31, 2018
MinebeaMitsumi Passion to Create Value through Difference Business Results Second Quarter of Fiscal Year Ending March 31, 2018 MinebeaMitsumi Inc. November 8, 2017
Slide 2: 1. Financial Results 2. Policy and Strategy
1. Financial Results 2. Policy and Strategy November 8, 2017 MinebosMisum!
Slide 3: Consolidated financial results for the first half
Hello, I would like to explain the consolidated financial results for the first half of the fiscal year ending March 2018. 3
Slide 4: First half consolidated financial results highlights
Here are the highlights of our consolidated financial results. Consolidated net sales for the first half of the fiscal year ending March 2018 totaled 429,027 million yen while operating income came to 41,951 million yen and net income 34,276 million yen. That's a year-on-year increase of 55.9% in ne
Slide 5: Second quarter consolidated financial results
Now I would like to go over the consolidated financial results for the second quarter of the fiscal year ending March 2018. Consolidated net sales reached 235,823 million yen while operating income totaled 24,889 million yen and net income 20,095 million yen. Net sales increased 52.3% year on year,
Slide 6: Quarterly net sales trends
This graph shows the trends in quarterly net sales. In this quarter, net sales reached 235.8 billion yen and were the highest quarterly figure ever recorded. We anticipate that net sales for the third quarter will decline from what they were in the second quarter given the conservative forecast for
Slide 7: Quarterly operating income trends
Here is a graph with a bar chart for quarterly operating income trends and a line chart indicating operating margins. The operating income was the highest ever recorded for any quarter, and the operating margin hit double digits to total 10.6 %. This was also the fourth straight quarter we saw opera
Slide 8: Machined components segment results
This slide shows the results for the machined components segment. On the left is a graph indicating quarterly net sales trends and on the right is a graph with a bar chart showing quarterly operating income trends along with a line chart for operating margins. Net sales for the second quarter were u
Slide 9: Electronic devices and components segment results
This slide shows the results for the electronic devices and components segment. Second quarter net sales rose 28% quarter on quarter to total 133.1 billion yen. Motor sales grew steadily, mainly in the automobile market, to hit 46.5 billion yen for a 6% quarter-on-quarter increase. Net sales of elec
Slide 10: Mitsumi business segment results
This slide shows the results for the Mitsumi business segment. Second quarter net sales were up 27% quarter on quarter to total 60.8 billion yen. The factors behind this increase included peaking demand that significantly drove up shipment volumes for camera actuators and new game consoles. Second q
Slide 11: Quarterly net income trends
This graph contains a bar chart showing quarterly net income trends and a line chart indicating net income per share. Net income jumped 42% quarter on quarter to reach 20.1 billion yen, setting a new quarterly record high. This figure far exceeds the previous quarterly record high, set in the fourth
Slide 12: Quarterly SG&A expenses
The graph you see here has a bar chart showing trends in quarterly SG&A expenses and a line chart indicating SG&A expenses-to-sales ratios. Quarterly SG&A expenses rose 1.5 billion yen quarter on quarter to total 25.3 billion yen while the SG&A expenses-to-sales ratio was down 1.6 percentage points
Slide 13: Quarterly inventory trend
Next we have the quarterly inventory trend. We see that as of the end of the second quarter inventories amounted to 163.2 billion yen. That figure is up 29.2 billion yen from what it was three months ago. The jump was mainly due to an inventory increase of components for smartphones and game console
Slide 14: Capital expenditures and depreciation
This graph has a bar chart on the left for capital expenditure trends and one on the right for depreciation trends. Capital expenditures for the first fiscal half totaled 22.3 billion yen while depreciation and amortization expenses amounted to 14.9 billion yen. We will add 4 billion yen to our init
Slide 15: Net interest-bearing debt and free cash flow
This graph contains a bar chart showing trends in net interest-bearing debt, which is total interest-bearing debt minus cash and cash equivalents, and a line chart indicating free cash flows. At the end of the second quarter, net interest-bearing debt, totaling 67.4 billion yen, was down 3.5 billion
Slide 16: Share buyback
As approved by the board of directors on February 13 of this year, we bought back 4,658,200 shares with a total value of 8,351,607,184 yen. 16
Slide 17: Forecast for fiscal year ending March 2018
This is a summary of our forecast for the fiscal year ending March 2018. We expect net sales, operating income, ordinary income, and net income for this fiscal year to exceed previous record highs by a wide margin. In the second half of this fiscal year, we expect the external shipment volumes of ba
Slide 18: Forecast by business segment
This slide shows the forecast by business segment. 18
Slide 19: Management policies and business strategies
Now I would like to go over our management policies and business strategies. 19
Slide 20: First half results (skipped)
Since we have already gone over the first half results, I'll move on to the next slide. 20
Slide 21: Second half forecast revisions
It took us a while to hammer out our second half forecast revisions before finally deciding to keep our estimates low in light of the uncertain outlook for smartphone components as well as various other factors. Since there are a number of factors that could significantly tip the scales, we calculat
Slide 22: Operating income by segment
The Mitsumi business segment is definitely giving a big boost to our operating income this fiscal year. Looking at the slide, you can see that the former Minebea operations also added to our operating income. We've made good progress in the machined components business, but our work there is not yet
Slide 23: Booming demand for ball bearings
We are witnessing booming demand for ball bearings from external customers. The external shipment volume reached 195 million units in September. While the shipment volume was 188 million units in October due to China's National Day holiday, it should hit 190 million units again this month. As shown
Slide 24: LED backlight business outlook
The LED backlight business has been really rocky. Our share price has dropped from 2,000 yen to around 1,300 yen over the last two years since the press reported an LCD panel maker's plan to invest a trillion yen in producing OLEDs for smartphones. I've been saying over and over that you never know
Slide 25: MINEGE sensor
Another wonderful development is the dream gauge we created called the MINEGE. After 15 years of trial and error, it’s now a reality. If I can get technical for a moment, the kind of gauge we currently use is a J gauge, and this new product is an N gauge. It is an extremely small, highly sensitive s
Slide 26: Mitsumi business turnaround
Since announcing the business integration with Mitsumi in December 2015, our share price fell from 1,300 yen to 650 yen. I'm now pleased to tell you that the same company that had a 10-billion-yen loss last fiscal year has been able to turn it all around and generate a 20-billion-yen profit this fis
Slide 27: Automotive market growth
We made this slide because there have been reports by various sources, saying that if we don’t concentrate on the automobile industry, we’ll be all washed up. We carry a tremendous number of products for automobile applications, including bearings, motors, sensors, connectors, coils, as well as ante
Slide 28: Short-term strategy and growth drivers
Let's look at our short-term strategy and what will grow over the next few years. As I mentioned earlier, I have a feeling that smartphones will sell more next year than they are this year. I'll show you proposed revisions to our three-year plan later on. Although I've been told that there were many
Slide 29: Three-year plan figures
This slide briefly summarizes this strategy in numerical terms. The areas shown in dark and light gray indicate the three-year plan we announced this past May. Since operating income for the fiscal year ending March 2018 should, at the least, reach 73 billion yen, there is an even greater likelihood
Slide 30: Operating income targets by segment
Having said that we may be able to achieve our 100-billion-yen operating income target 1 or 2 years earlier than projected, based on current estimates we also expect operating income for machined components to exceed our previous projection of 50 billion yen and reach 51 billion yen. I would like to
Slide 31: C&A Tool Engineering acquisition
C&A Tool Engineering, whose acquisition was announced in September, possesses the technology to make the first 3D printed medical parts approved by the U.S. Food and Drug Administration. While we've toyed with the idea of investing in 3D printing for years, we’ve finally been able to get our hands o
Slide 32: Mach Aero acquisition
As we announced on November 6, we also acquired all shares of Mach Aero, a French company that supplies core parts to major aircraft manufacturers. This M&A will not only give us access to the core parts manufacturing technologies but also enable us to build stronger ties with these aircraft manufac
Slide 33: Net debt-to-equity ratio and shareholder returns
The net debt-to-equity ratio, which was 103% when I became the president, is now about 20%. We have increased dividends forecast by a wide margin this fiscal year and our rating was raised to single A. We will continue to invest in growth opportunities while actively looking at ways to increase shar
Slide 34: MinebeaMitsumi
MinebeaMitsumi Passion to Create Value through Difference Business Results MinebeaMitsumi Inc. http:/Awww.minebeamitsumi.com/ Any statements in this presentation which are not historical are future projections based on certain assumptions and executive judgments drawn from currently available inform